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To: Municipalities; Energy
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026
By: Senator(s) Blount
SENATE BILL NO. 2375
AN ACT TO AMEND SECTION 21-27-7, MISSISSIPPI CODE OF 1972, TO 1
PROVIDE THAT FEES OR CHARGES FOR WATER SERVICES SHALL BE ASSESSED 2
JOINTLY AND SEVERALLY AGAINST USERS OF THE SERVICE AND THE OWNER 3
OF THE PROPERTY FURNISHED THE SERVICE; TO PROVIDE THAT ANY PERSON 4
WHO PAYS AN AMOUNT FOR WATER SERVICES AS PART OF A RENTAL OR LEASE 5
AGREEMENT SHALL NOT BE HELD LIABLE UPON THE FAILURE OF THE OWNER 6
TO PAY FEES; TO PROVIDE THAT FEES SHALL BE A LIEN UPON THE REAL 7
PROPERTY OFFERED THE SERVICE; TO PROVIDE THAT FEES MAY BE ASSESSED 8
ANNUALLY; TO PROHIBIT THE SALE OF PERSONAL PROPERTY TO SATISFY A 9
LIEN UNDER THIS SECTION; TO REQUIRE THE MUNICIPALITY OR 10
RECEIVERSHIP TO NOTIFY THE COUNTY TAX COLLECTOR OF THE UNPAID FEES 11
OR CHARGES; TO PROHIBIT THE TAX COLLECTOR FROM ISSUING OR RENEWING 12
A MOTOR VEHICLE ROAD AND BRIDGE PRIVILEGE LICENSE FOR ANY MOTOR 13
VEHICLE OWNED BY A PERSON WHO IS DELINQUENT IN THE PAYMENT OF 14
CHARGES UNLESS SUCH FEES ARE PAID; TO DETERMINE WAYS LIENS CREATED 15
UNDER THIS SECTION MAY BE DISCHARGED; AND FOR RELATED PURPOSES. 16
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 17
SECTION 1. Section 21-27-7, Mississippi Code of 1972, is 18
amended as follows: 19
21-27-7. (1) (a) The governing authorities of 20
municipalities shall have the power to erect, purchase, maintain 21
and operate waterworks, and to regulate the same, and to prescribe 22
the rates at which water shall be supplied to the users. The 23
rates at which water, wastewater, and sewer services shall be 24
supplied shall be just and reasonable based on the actual cost to 25
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operate and maintain the systems, and rates may not be 26
unreasonably preferential, prejudicial or discriminatory but shall 27
be sufficient, equitable and consistent in application to each 28
class of users. While a municipality may set different rates for 29
different classifications of users, a municipality shall not 30
discriminate in setting rates among members of the same 31
classification. The municipal governing authorities shall make a 32
finding on the minutes of the governing body establishing the rate 33
based on the actual cost to operate and maintain the system. A 34
municipality shall not charge a user a fee for services received 35
which is less than the cost incurred by the municipality to 36
provide such services. 37
(b) The governing authorities of a municipality shall 38
establish and maintain rates and charges in equitable proportion 39
to the use of the services and benefits rendered by the waterworks 40
systems and water treatment facilities serving the municipal area. 41
From time to time the governing authorities shall adjust such 42
rates, to the end that the revenues therefrom will be sufficient 43
at all times to pay the expenses of operating and maintaining such 44
works, facilities and systems and all of the municipality's 45
obligations under any contract or bond resolution with respect 46
thereto. The calculation of a user's bill shall be limited to the 47
actual amount of volumetric usage, plus those fees reasonable and 48
necessary for the cost of capital expenses, system operation and 49
maintenance, and debt service. 50
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(c) If a user's meter is tampered with, unreadable, or 51
otherwise out-of-order, a municipality may render an estimated 52
bill to that user for a period not to exceed six (6) months. In 53
such circumstance, an estimated bill shall be based upon the prior 54
average measured usage of the user or a similar user of the same 55
classification. 56
(i) Only in the event a municipality is unable to 57
meet the requirement of billing based solely on volumetric usage, 58
such municipality may bill based on a flat fee rate where such 59
municipality has established flat fee billing as its usual and 60
customary billing practice prior to July 1, 2023, and where such 61
municipality is actively billing based upon a flat fee rate as of 62
July 1,2023. In such circumstances, flat fee billing may be 63
utilized until such time as the municipality implements upgrades 64
to its system to provide for volumetric billing. In such 65
circumstance, the municipality may set different flat fee rates 66
for different classifications of users, but the municipality shall 67
not discriminate in setting flat fee rates among members of the 68
same classification, and the municipality shall not charge a user 69
a fee for services received that is less than the cost incurred by 70
the municipality to provide such services. 71
(ii) The governing authorities of the municipality 72
shall make a finding annually on the minutes of the governing body 73
establishing the rate based upon the actual cost to operate and 74
maintain the system as determined under Generally Accepted 75
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Accounting Principles, and the municipality shall not charge a 76
user a fee for services received that is less than the cost 77
incurred by the municipality, or based on the assessed value of 78
the property, to provide such services. 79
(d) Notice of any change in the rate or rate structure 80
at which services are supplied shall be posted on all bills sent 81
to users at least one (1) month prior to the effective date of the 82
rate change. Notice shall also be posted to the municipality's 83
online web page or bill payment platform, if the municipality has 84
an online web page or bill payment platform. 85
(e) Nothing in this statute shall be construed as 86
prohibiting a user or governing authority of any municipality from 87
applying for and receiving any federally or privately subsidized 88
payment assistance, grant or other funds. 89
(f) The governing authority of a municipality may 90
provide for the calculation of a user's bill by a method other 91
than volumetric usage only in exchange for consideration as part 92
of, or in connection with, an incentive contract or other form of 93
benefit or assistance related to the user's location, expansion, 94
or maintenance of its commercial or industrial operation within 95
the municipality, so long as such rate is equitable, fair, and 96
nondiscriminatory, and the municipality shall not charge such user 97
a fee for services received that is less than the cost incurred by 98
the municipality to provide such services. 99
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(2) The governing authorities of municipalities shall have 100
the power to acquire by purchase, donation or condemnation, in the 101
name of the municipality, suitable grounds, within or without the 102
corporate limits, upon which to erect waterworks, and also the 103
right-of-way to and from such works and the right-of-way for 104
laying water pipes within the corporate limits, and from such 105
waterworks to the municipality, and to extend such right-of-way 106
from time to time. The governing authorities shall have the power 107
to contract with any person for the maintenance and operation of 108
waterworks. The authorities shall have the power to contract with 109
any person for the erection and maintenance of waterworks for a 110
term not exceeding twenty-five (25) years, fixing water rates in 111
the contract subject to municipal regulations. A contract for the 112
erection or purchase of waterworks shall not, however, be entered 113
into until submitted to a vote of the qualified electors and 114
approved by a majority of those voting. A contract for 115
maintenance under which the person who will perform such 116
maintenance is wholly or partially responsible for fixing water 117
rates shall not be entered into until submitted to a vote of the 118
qualified electors and approved by a majority of those voting. It 119
shall be unlawful for any municipally owned waterworks to supply 120
water free of charge, or in any amount less than the fixed 121
charges, to any person, firm or corporation, except as is 122
expressly authorized by law. 123
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(3) (a) Fees or charges for services provided by 124
municipally owned water utilities, or by court-initiated 125
receiverships for municipally owned or operated water utilities, 126
shall be assessed jointly and severally against the user of the 127
service and against the owner of the property furnished the 128
service. However, any person who pays, as a part of a rental or 129
lease agreement, an amount for service shall not be held liable 130
upon the failure of the property owner to pay such fees. 131
(b) Every user assessed the fees or charges provided 132
for and limited by this subsection (3) and the owner of the 133
property occupied by that user shall be jointly and severally 134
liable for the fees and/or charges so assessed. The fees or 135
charges shall be a lien upon the real property offered water 136
service. 137
At the discretion of the governing body of the municipality 138
or the court-initiated receivership, fees or charges assessed for 139
the service may be assessed annually. If fees or charges are 140
assessed annually, the fees or charges for each calendar year 141
shall be a lien upon the real property offered the service 142
beginning on January 1 of the next immediately succeeding calendar 143
year. The person or entity owing the fees or charges, upon 144
signing a form provided by the governing authority or 145
receivership, may pay the fees or charges in equal installments. 146
If fees or charges so assessed are assessed on a basis other 147
than annually, the fees or charges shall become a lien on the real 148
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property offered the service on the date that the fees or charges 149
become due and payable. 150
No real or personal property shall be sold to satisfy any 151
lien imposed under this section. 152
The municipality or receivership shall mail a notice of the 153
lien, including the amount of unpaid fees or charges and a 154
description of the property subject to the lien, to the owner of 155
the property subject to the lien. 156
(c) The municipal governing body or receivership shall 157
notify the county tax collector of any unpaid fees or charges 158
assessed under this section within ninety (90) days after such 159
fees or charges are due. Upon receipt of a delinquency notice, 160
the tax collector shall not issue or renew a motor vehicle road 161
and bridge privilege license for any motor vehicle owned by a 162
person who is delinquent in the payment of fees or charges, unless 163
such fees or charges, in addition to any other taxes or fees 164
assessed against the motor vehicle, are paid. 165
(d) Liens created under this section may be discharged 166
as follows: 167
(i) By filing with the tax collector a receipt or 168
acknowledgment, signed by the municipality or receivership, that 169
the lien has been paid or discharged; or 170
(ii) By depositing with the tax collector money to 171
the amount of the claim, which money shall be held for the benefit 172
of the municipality or receivership. 173
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ST: Unpaid water fees to municipally owned
utilities and court-initiated receiverships;
assess as lien on property.
SECTION 2. This act shall take effect and be in force from 174
and after July 1, 2026. 175