(A)   It is declared to be the intent and policy of the Town Council that in the future all new water rates and charges established by the town and approved by the Public Service Commission of Indiana should be sufficient not only to fund those expenses and obligations of the water utility as set forth in I.C. 8-1.5-3-8(c), but also:
      (1)   To provide the town with a reasonable return on its capital investment in the water utility plant and distribution system; and
      (2)   To provide the town with a reasonable return in lieu of property taxes (ILPT) on the assessed value of the plant and distribution system.
   (B)   For purposes of subsection (A)(1), the Town Council shall expressly declare, as a provision of its water rate request and proposed rate ordinance, the percentage earning factor which it has deemed "reasonable," which shall not exceed the rate of return which the town could earn were it to invest an amount of funds, equal to the then current capital evaluation of the water utility, in the highest yielding security or account in which town funds may lawfully be invested under I.C. 5-13-9 as available during the week when the proposed water rates are adopted; or, in the absence of any such more particular and definitive criterion, the Town Council may base its judgment and request on the one year U.S. Treasury "money market," rate for such week as determined and published by the Federal Reserve Bank of the United States. For purposes of subsection (A)(2), the ILPT water rate factor shall be based on the application of the total civil town property tax rate as in effect for the then current fiscal year to the assessed valuation of the portions of the water utility plant and distribution system which would be subject to municipal property taxes were the utility privately owned, as such assessed valuation is determined by the Public Service Commission and State Board of Tax Commissioners. This section does not affect any water rates and charges as now fixed under the provisions of §§ 52.35 et seq. but applies only to new rate requests and amendments thereto which may be adopted and submitted after this section takes effect.
(`86 Code, § 2-6-9) (Ord. 86-C1, passed 7-15-86)