IndianaSB 4First Regular Session 124th General Assembly (2025)Senate

Water matters.

Sponsored By: Eric Koch (Republican)

Signed by Governor

Summary

Prohibits a water utility from constructing a long haul water pipeline unless the water utility first obtains a certificate of public convenience and necessity (CPCN) from the Indiana utility regulatory commission (IURC). Sets forth specified information that an application for a CPCN must include. Sets forth specified findings that the IURC must make before granting a CPCN. Sets forth conditions under which a water utility may recover through rates the actual costs the water utility incurs in reliance on a CPCN issued by the IURC. Provides that a person that transfers, sells, or leases a long haul water pipeline must provide written notice to the IURC of the transfer, sale, or lease not later than 60 days after the transfer, sale, or lease is finalized. Prohibits a person that transfers or proposes to transfer: (1) more than an annual average of 30,000,000 gallons of water per day out of a basin; or (2) water from a restricted use area; from transferring water out of a basin, or supplying water to another person that the person knows will transfer more than 100,000 gallons of water out of a basin, without first obtaining a transfer permit from the department of natural resources (department). Sets forth specified information that must be included in an application for a transfer permit. Provides that a transfer permit is required for an existing or ongoing interbasin transfer (as of July 1, 2025) if the existing or ongoing transfer exceeds the capacity of any system engaged in the interbasin transfer in any 90 day period. Provides that the department shall approve an application for a permit if the department determines that the transfer: (1) will not result in a perennial overdraft of a ground water resource or in a perennial stream flow depletion; and (2) is in the public interest, as described in the Indiana Code section concerning beneficial uses of Indiana's surface water resources. Provides that a transfer permit: (1) does not expire; and (2) may be renewed, revoked, suspended, or modified in certain circumstances. Provides that the department may assess a civil penalty for violations of these provisions.

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Bill Overview

Analyzed Economic Effects

6 provisions identified: 0 benefits, 1 costs, 5 mixed.

Water customers pay qualifying pipeline costs

Beginning July 1, 2025, utilities generally recover qualifying long-haul pipeline costs through customer rates, which can raise water bills. Recovery excludes fraud, concealment, or gross mismanagement. For completed projects, costs approved during ongoing review enter rates without further review; deferred review excludes costs caused by poor quality controls and requires proof that above-estimate costs were necessary and prudent. When a certificate change or problems beyond the utility’s control cancel a project, approved ongoing-review costs can be recovered over time; deferred-review recovery is generally limited to necessary and prudent costs within the original estimate. Public utilities can also earn their authorized return on the unpaid balance of recoverable cancellation costs.

Large water users face transfer limits

Beginning July 1, 2025, users proposing transfers averaging more than 30 million gallons daily, or transferring from a state-designated restricted-use area, generally need a permit to move water between Indiana basins. This also covers supplying someone they know will move more than 100,000 gallons daily out of a basin; groundwater transfers are generally exempt unless the department finds lasting stream-flow depletion. Exemptions cover qualifying reservoir withdrawals, transfers within one utility’s cross-basin service area, specified pre-2025 agreements, wholesale customers existing on July 1, 2025, affiliates, consolidated city-controlled utilities, and Great Lakes Compact transfers. Existing transfers lose their exemption if they exceed any participating system’s withdrawal, treatment, distribution, or other capacity in any 90-day period; transfers that leave natural flow undisturbed because the destination is upstream or downstream are also exempt. The Department of Natural Resources can declare temporary emergencies for extended drought, disasters, major utility outages, or similar events, allowing qualifying transfers to areas in need without the usual permit.

Utilities need approval for major pipelines

Beginning July 1, 2025, utilities need state approval before building new continuous pipelines able to carry at least 10 million gallons daily at least 30 miles from the source. Pipelines returning at least 50% of the water after use, or located partly or wholly in the Great Lakes–St. Lawrence River basin, are excluded. Public, municipal, nonprofit, cooperative, conservancy district, and regional water district utilities must submit project details, environmental effects, alternatives, conservation plans, costs, and customer-rate effects. The Indiana Utility Regulatory Commission must hold a public hearing and decide within 240 days after the application and the utility’s main supporting case are filed. Approval requires reasonable cost estimates, public need, and a finding that construction serves the public interest; the commission can approve only part of a project or attach conditions.

Water transfer permits carry ongoing duties

Beginning July 1, 2025, water-transfer permits stay in effect unless the permit or another law sets an expiration. Holders must certify compliance at least once every five years. The Department of Natural Resources can change, suspend, or revoke permits for violations, fraud or other wrongdoing in obtaining them, missing certifications, or public-interest reasons. It can also fine a covered user up to $10,000 per day for each knowing violation, but fines are not mandatory. Collected fines go to Indiana’s state general fund.

Utilities face pipeline reporting and oversight

Beginning July 1, 2025, approved pipelines receive ongoing construction review unless the utility chooses review at completion or cancellation. During ongoing review, utilities must report progress and updated costs yearly, unless they agree with the commission on another schedule. The commission can change or revoke approval after rejecting reviewed work or costs, and can act against violations or fraud. A pipeline sale, transfer, or lease does not require a new construction approval. The seller, transferor, or lessor must notify the commission within 60 days after closing, using its required format and providing the new holder’s name and contact details.

Water transfers require studies and fees

Beginning July 1, 2025, applicants for covered water-transfer permits must document the purpose, need, volumes, locations, return flows, facility capacity, and start date. They must also provide water-flow and environmental studies, alternatives, conservation practices, any other required information, and a department-set filing fee with no amount stated in the law. Applicants have 60 days to fix missing information, and the Department of Natural Resources must issue a written decision within 90 days after receiving a complete application. The department must approve a complete application when the transfer avoids lasting groundwater overdraft and stream-flow depletion and serves the public interest. It can add permit terms needed to protect water resources and the public interest.

Sponsors & Cosponsors

Sponsor

  • Eric Koch

    Republican • Senate

Cosponsors

  • Alaina Shonkwiler

    Republican • House

  • Andrea Hunley

    Democratic • Senate

  • Blake Doriot

    Republican • Senate

  • Brian Buchanan

    Republican • Senate

  • Chris Garten

    Republican • Senate

  • Cyndi Carrasco

    Republican • Senate

  • Dan Dernulc

    Republican • Senate

  • Daryl Schmitt

    Republican • Senate

  • Dave Hall

    Republican • House

  • Ed Charbonneau

    Republican • Senate

  • Edmond Soliday

    Republican • House

  • Eric Bassler

    Republican • Senate

  • Greg Goode

    Republican • Senate

  • J.D. Ford

    Democratic • Senate

  • James Tomes

    Republican • Senate

  • Linda Rogers

    Republican • Senate

  • Mike Bohacek

    Republican • Senate

  • Mike Gaskill

    Republican • Senate

  • Ron Alting

    Republican • Senate

  • Stacey Donato

    Republican • Senate

  • Susan Glick

    Republican • Senate

  • Travis Holdman

    Republican • Senate

  • Vaneta Becker

    Republican • Senate

Roll Call Votes

All Roll Calls

Yes: 238 • No: 134

Senate vote • 4/8/2025

Senate concurred with House amendments

Yes: 45 • No: 2

House vote • 4/1/2025

Third reading: passed

Yes: 93 • No: 0

House vote • 3/31/2025

Amendment #2 (Campbell) failed

Yes: 25 • No: 66

House vote • 3/31/2025

Amendment #1 (Pierce M) failed

Yes: 27 • No: 66

Senate vote • 2/4/2025

Third reading: passed

Yes: 48 • No: 0

Actions Timeline

  1. Public Law 99

    4/22/2025Senate
  2. Signed by the Governor

    4/22/2025Senate
  3. Signed by the President of the Senate

    4/15/2025Senate
  4. Signed by the Speaker

    4/9/2025House
  5. Signed by the President Pro Tempore

    4/9/2025Senate
  6. Senate concurred with House amendments; Roll Call 369: yeas 45, nays 2

    4/8/2025Senate
  7. Motion to concur filed

    4/4/2025Senate
  8. Returned to the Senate with amendments

    4/2/2025House
  9. Representative Hall added as cosponsor

    4/1/2025House
  10. Third reading: passed; Roll Call 339: yeas 93, nays 0

    4/1/2025House
  11. Representative Shonkwiler added as cosponsor

    4/1/2025House
  12. Amendment #1 (Pierce M) failed; Roll Call 324: yeas 27, nays 66

    3/31/2025House
  13. Amendment #2 (Campbell) failed; Roll Call 325: yeas 25, nays 66

    3/31/2025House
  14. Second reading: ordered engrossed

    3/31/2025House
  15. Committee report: amend do pass, adopted

    3/25/2025House
  16. First reading: referred to Committee on Utilities, Energy and Telecommunications

    3/3/2025House
  17. Referred to the House

    2/7/2025Senate
  18. Senator Buchanan added as coauthor

    2/6/2025Senate
  19. House sponsor: Representative Soliday

    2/4/2025Senate
  20. Third reading: passed; Roll Call 65: yeas 48, nays 0

    2/4/2025Senate
  21. Senator Schmitt added as coauthor

    2/3/2025Senate
  22. Amendment #1 (Deery) prevailed; voice vote

    2/3/2025Senate
  23. Second reading: amended, ordered engrossed

    2/3/2025Senate
  24. Committee report: amend do pass, adopted

    1/30/2025Senate
  25. Senators Becker, Bohacek, Dernulc, Donato, Gaskill, Rogers, Holdman, Tomes added as coauthors

    1/28/2025Senate

Bill Text

  • Engrossed Senate Bill (H)

  • Enrolled Senate Bill (S)

  • Introduced Senate Bill (S)

  • Senate Bill (S)

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