§1206. Water and wastewater companies; receivership; bond; dissolution

            A. As used in this Section, the following terms have the following meanings:

            (1) "Wastewater company" means any wastewater company regulated by the commission.

            (2) "Water company" means any water company regulated by the commission.

            B.(1) In any civil action brought in accordance with this Section, relative to water companies or wastewater companies, the court, upon application by the commission, may appoint a receiver for a water company or wastewater company to collect the assets and carry on the business of the water company or wastewater company. Application by the commission shall not be subject to any bond requirement.

            (2) The court may place the water company or wastewater company in receivership upon finding any of the following:

            (a) The water company or wastewater company has been abandoned by the operator, or service to its customers has ceased, and no provisions have been made for the continued operation by a qualified operator, or for providing customers with services required to serve the users of the systems.

            (b) The water company or wastewater company has failed or refused to comply with enforceable orders, judgments, or actions issued by the Louisiana Department of Health or the Louisiana Department of Environmental Quality.

            (c) After an audit by the commission, the commission determines the water company or wastewater company is in financial distress.

            (d) Other circumstances as may be identified by rules adopted by the commission pursuant to the commission's Rules of Practice and Procedure under which a receivership may be needed.

            (e) The water company receives a grade of "D" or "F" pursuant to R.S. 40:5.9.1 et seq., and the commission finds that the water company is either financially, managerially, or technically unable to restore the utility to a grade of "C" or better.

            (f) The wastewater company experiences a sewerage discharge in excess of the Final Effluent Limitations specified in the company's Louisiana Pollutant Discharge Elimination System General or Site Specific Permit, as reported in three or more consecutive quarters pursuant to the electronic document receiving system promulgated by the Louisiana Department of Environmental Quality, and the commission finds that the wastewater company is either financially, managerially, or technically unable to restore the utility to regulatory compliance.

            (3) The receiver, if a private person, shall execute a bond to ensure the proper performance of the receiver's duties in an amount to be set by the court. The court may waive the bond upon a showing of just cause. If the receiver is a local governmental subdivision, no bond shall be required.

            (4) The receiver shall carry out the orders specified and directed by the court until discharged.

            (5) The court may dissolve the receivership if the person owning or operating the defendant water company or wastewater company requests that the receivership be dissolved or such owner or operator can show good cause for the dissolution of the receivership. Nothing herein shall prohibit a receiver from purchasing the company put in receivership.

            C. Within ninety days of appointment, the receiver shall submit to the commission and publish in a manner accessible to the affected customers a transition and operational plan. This plan shall include all of the following:

            (1) Measures to restore or maintain service.

            (2) Financial assessments and projected costs.

            (3) Customer service provisions.

            (4) An anticipated timeline for resolution or return of control to the original operator or transfer to a new operator.

            Acts 2025, No. 257, §1.