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Senate establishes proposed reserve account for water and wastewater projects amid debate over automatic transfers
Summary
Senate advanced House Bill 147 to create a Water and Sewer Projects Reserve Account funded by the first 10% of annual surplus up to $10 million, to be deposited into four existing water-revolving funds. Debate focused on automatic transfers, budgeting impacts and precedent for earmarking surpluses.
House Bill 147 would establish a special subaccount in the general fund — the Water and Sewer Projects Reserve Account — receiving the first 10% of the state's surplus each year up to a $10 million cap. Money deposited in the reserve would be available for appropriation into four existing revolving funds for water reclamation, sewage projects and culinary water systems.
Senator Montgomery, the bill sponsor on the floor, said the account creates a predictable source of funds for local water and wastewater infrastructure projects and emphasized the longstanding need for investment in water projects across the state. Proponents pointed to substantial backlog and assessed an aggregate need in the hundreds of millions for water projects.
Opponents, including Senator Black, warned that automatically diverting 10% of surplus could create budgeting complications and reduce flexibility for other priorities; others said the legislature retains appropriation control and highlighted the precedent for targeted deposits to revolving funds. Some senators expressed concern that creating a new automatic deposit could invite competing requests for other program areas.
After extended floor debate the Senate voted and the clerk recorded the bill as passed and placed on the third-reading calendar (reported 15 ayes, 10 nays, 4 absent). Sponsors and opponents agreed the deposits would still require legislative appropriation to be spent, but senators requested careful review of fiscal notes and future appropriation strategy before final enactment.
