MO HB2196

Creates a three-appraiser process to determine fair market value when a small utility (8,000 or fewer customer connections) sells its water or sewer system to a large public utility (more than 8,000 connections), with appraisers selected by the small utility, large utility, and jointly appointed third appraiser.

Establishes that the ratemaking rate base for the acquired system shall be the lesser of the purchase price or appraised value plus transaction, closing, and transition costs incurred by the acquiring utility.

Requires the acquired small utility to become part of the large utility's designated district immediately upon acquisition, with customers paying the district's existing rates until new rates take effect in the next rate case.

Mandates that in the next rate case, the acquired small utility and acquiring district combine under the same rate tariff based on combined costs of service without distinguishing customers by utility service source or type.

Establishes a regulatory asset or liability for any difference between actual and authorized pretax earnings, to be amortized over no more than three years.