Section 216-RICR-50-05-7.8 - FINANCING INFRASTRUCTURE IMPROVEMENTSA. Each water supplier subject to the requirements of this Part shall establish a separate special account designated as the Infrastructure Replacement Fund to be held as a restricted receipt account and to be administered by the water supplier solely to implement and carry out the replacement or rehabilitation of infrastructure in accordance with the approved plan. The dedicated account should be invested in accordance with the standards established for the agency, municipality, or water supplier.B. The costs of programs to implement infrastructure replacement shall be paid by the users of the water system at a rate directly proportional to the users' consumption of water. Charges shall be limited to those necessary and reasonable for implementation of the plan. These charges shall be based upon the annual funding requirements of the facility improvements necessitated over each successive twenty (20) year period.C. Interest earned on this account shall be credited to this account only. Accumulated funds in excess of that estimated to be necessary to implement the plan shall revert to the rate payers of the system on a biannual basis. Funds will be allowed to accumulate with the intent to build sufficient capital to finance the estimated costs of major projects. It is understood that annual investments may be necessary over many years to fund major projects. Funds accumulated that are in excess of that estimated to implement the plan will cause the water supplier to reduce the future charges for infrastructure replacement.D. Water suppliers may alternatively fund the infrastructure replacement program through partial or complete external funding at the option of the water supply system. Debt service and debt service issuance costs for any and all funding shall be an eligible expense as part of the program's funding requirements.E. The Public Utilities Commission, as to water suppliers within its jurisdiction, shall permit an increase for just and reasonable infrastructure replacement in the portion of the water suppliers' rate structure to comply with this Part and shall allow the water supplier to add this required funding to its rate base in accordance with this Part. Proposed increases in rates by regulated water utilities to finance infrastructure improvements shall be filed and reviewed in conformance with R.I. Gen. Laws Title 39.F. The applicable section of the water supplier's annual audit shall be submitted to the Department to verify compliance with the funding intentions of the infrastructure replacement plan. The dedicated fund for infrastructure replacement will be a separate line item in the audit. Financial and summary status reports shall be submitted for each on-going project which outlines funds spent on the project, funds remaining, percentage of completion, and a brief description of work completed and work remaining. Project expenditures must be consistent with the plan and be eligible expenditures under the plan. Audits shall be submitted within 180 days from the end of the water supplier's fiscal year. Extensions will be allowed for reasonable cause.216 R.I. Code R. 216-RICR-50-05-7.8