- Utah's HB501 seeks to help fund water infrastructure by increasing modified adjusted gross income for projects.
- The bill advanced in committee despite concerns over higher costs for residents.
- It aims to address a $1.2 billion annual infrastructure need.
SALT LAKE CITY — Approximately $1.2 billion is needed every year to maintain and upgrade water and sewage infrastructure across Utah, including $700 million in drinking water, a state study found last year.
"It was actually fairly alarming, some of the information we got back," said Rep. Bridger Bolinder, R-Grantsville, as he referenced the study that was commissioned through a Utah bill passed in 2024.
Bolinder's behind a new bill that seeks to chip away at that concern, which cleared its first legislative hurdle on Tuesday. Members of the House Natural Resources, Agriculture and Environment Committee voted 10-2 in favor of supporting it, but not before a fierce discussion over how to pay for the staggering costs.
HB501, sponsored by Bolinder, calls on public water systems to charge at least 3% of the modified adjusted gross income, or MAGI, to receive state funding for water infrastructure projects. MAGI is used to "determine the maximum affordable water bill for the water system," as noted by the Utah Division of Drinking Water.
The proposal is a percentage point higher than what's required now, Bolinder explained. The minimum rate would be 1.5% for customers who don't have the same drinking water and wastewater service provider under the bill.
The bill doesn't instruct water companies how to charge their rates, but they would have to meet the new requirements to receive state funding for water projects. All of the money collected through the fees would remain with the local water entity to help pay for water-related projects.
"We have more needs in our state than we have dollars to use, so we're really careful and good stewards of the money we appropriate," he said. "I think this bill strikes a good balance in putting it back in the local control and saying, 'You do what you need to do before we can appropriate money for water projects."
Last year's report also noted that over $850 million could be raised annually through local drinking water systems and water suppliers to pay for project costs, said Candice Hasenyager, director of the Utah Division of Water Quality. HB501, she added, would be the first step in getting locals to "pay what they can" toward maintaining water and sewer services, while Utah plays a role in funding projects.
The bill, in its original version, initially drew concern from towns and cities over its language. What Bolinder presented on Tuesday clarified that the money collected wouldn't go toward the state and stripped out any mandates on the cities.
However, the committee and audience still had issues with the updated version. It could increase the fees residents pay for water and sewage at a time when many residents are facing tighter budgets, especially those in rural communities or on fixed incomes.
"I get the concept. I truly get that ... but I do have some concerns," said Rep. Christine Watkins, R-Price, who ultimately voted in favor of advancing it following the discussion of the bill.
Mickey Wright, mayor of Torrey, Wayne County, said the increased costs would likely be a burden on city planning and residents. Former state lawmaker Derek Kitchen said he likes the direction of the bill, but he called for additional safeguards to help families who may face increased rates to help cities qualify for state funding.
Others argued it's simply a new water tax that would go toward unclear water projects.
"During a time when everyone is feeling pinched by rising costs, adding another tax on top of what we already pay for our water seems ill-intended," said Cecily Ross, legislative intern for Sierra Club Utah.
However, the state still faces a "significant deficit" in funding water projects, which is also concerning, said House Majority Leader Casey Snider, R-Paradise.
Those needs may only get more complex and expensive with time, others on the committee agreed. They noted there have been many recent water appropriation requests with little to no buy-in from the requesting party, which they believed the bill could address.
The majority ultimately voted to advance the bill after about an hour of discussion because of the needs.
"If we don't get ahead of our water infrastructure needs in a fair way, we will be in a deficit more risky than the drought that we're facing," Snider said. "These are hard conversations, but ... this is a good step in the right direction."
The bill now heads to the House floor for a full vote, but it could undergo more revisions based on the feedback collected on Tuesday.
All bills must be passed by the House and Senate by the end of March 6 before going into law. If approved, some parts of the bill would go into effect in May and others in July.
