Dive Brief:

• The Indiana House of Representatives has passed a bill that would limit a municipal utility's ability to serve annexed areas if they extend beyond its already existing service territory.
• The measure, Senate Bill 309, has some towns concerned that it could take away their ability to serve growing populations that extend beyond their traditional borders.
• Sponsored by Sen. Michael Crider (R), The Shelbyville News reported that the House passed an amended version designed to not interfere with any annexations already underway.

Dive Insight:

Indiana lawmakers in both houses have passed legislation that would put limits on a municipal utility's ability to take over territory traditionally outside of its service borders. While munis say the law would hinder their ability to serve residents as their populations swell, potentially limiting economic development, utilities argue the annexations are unfair and towns are essentially taking over only the most economically viable areas.

Municipal providers serve about 7% of Indiana's residents, and of 569 municipalities in the state more than 10% have utilities.

The Senate passed the measure in February by a vote of 42-7. The House's version passed 71-20, but the Shelbyville News reports it has been referred back to the Senate with amendments. Lawmakers worried about the impact on annexations already in progress have worked to make sure those proceedings would be unaffected by the new law.