A private utility is asking Georgia legislators to change a state law so the company can provide water service to new homes near Hyundai's upcoming electric vehicle factory without first getting permission from local governments.

A state Senate committee in Atlanta voted Tuesday to advance House Bill 1146 a week after it passed the House. The proposal's sponsor says it's needed to accelerate home construction in Bryan County, where Hyundai plans to employ 8,500 workers at its $7.6 billion EV plant west of Savannah.

Conservation groups oppose the measure along with the Georgia Municipal Association and the Association County Commissioners of Georgia, which argue it would undermine the authority of city and county governments to manage limited water resources in Georgia's rapidly growing coastal region.

Hyundai broke ground in October 2022 on its first U.S. factory dedicated to producing EVs and the batteries that power them. It's the largest economic development project in Georgia's history, and construction has progressed quickly as the South Korean automaker seeks to begin manufacturing cars by the end of this year.

Rep. Ron Stephens, a Savannah Republican, says limits state regulators have placed on how much water Bryan County can withdraw from the Floridan aquifer, the region's main source of drinking water, are slowing construction of new homes needed to accommodate Hyundai's workforce. He told the Senate committee there's no time to wait on Bryan County to expand its government-run water system.

"Sometimes we have to allow water systems and sewer systema that are privatized to do that," Stephens said.

Savannah-based Water Utility Management, a private company that supplies drinking water to 32,000 homes in 17 Georgia counties, has been pushing lawmakers to pass Stephens' proposal.

Company officials say they have capacity to withdraw enough water to supply about 3,000 homes near the Hyundai plant, but have struggled to get approval from Bryan County as county officials pursue a $360 million expansion of their own water and sewer system.

Georgia law requires local governments to sign off on a private company's plans to provide water service to development projects before that company can obtain required permits from state regulators.

Stephens' proposal would let private utilities bypass such permission if a local government is unable to provide water for the same project within 18 months.

"What this bill does is prevent the county from having a veto power over a private system," Mark Smith, CEO of Water Utility Management, told the Senate Committee on Natural Resources and the Environment.

It would apply only to projects seeking water from "coastal aquifers" and would lapse at the beginning of 2029.

Opponents say the bill would not only hinder local governments' ability to manage growth but would also circumvent safe drinking water rules that protect Georgia consumers.

"This bill will benefit a private water supplier at the expense of an existing and effective water policy that works everywhere in the state," said Pam Burnett, executive director of the Georgia Association of Water Professionals.

The battle over expanding water service in Bryan County stems from restrictions the Georgia Environmental Protection Division placed in 2013 on counties in the Savannah area that limit how much water they can withdraw from the Floridan aquifer. The caps were imposed after scientists concluded excessive pumping was drawing saltwater into the aquifer.

Because of the restrictions on Bryan County, four wells are being drilled in neighboring Bulloch County to supply the Hyundai plant with up to 6.6 million gallons (25 million litres) of water daily.

Bryan County, home to about 45,000 people, is working on a $360 million expansion of its water system to serve the plant and nearby homes that are scheduled to come online in April 2025.

Ben Taylor, Bryan County's government administrator, told the Senate committee "we're not here to oppose any type of legislation." But testimony from the engineer overseeing the county's water expansion, Trent Thompson, suggested a private utility would be an unwelcome competitor in the area.

"There's about $120 million in loans that have to be paid back" on the water expansion, Thompson said. "And it's critical that service area has that customer base to have those revenues coming in for Bryan County to service those debts."