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Non-Refundable Connection Fees

Reference Number: MTAS-1385
Reviewed Date: 09/29/2025

As an alternative to deposits, cities may choose to charge nonrefundable connection fees. Unlike deposits, which are recorded as a liability on the utility’s statement of net position and must be tracked for the duration of the customer’s service, a nonrefundable connection fee is recognized as revenue when received. Because it is not refundable, there is no need to maintain ongoing records to track the payment, simplifying accounting and administration.