(a) The assembly acting for the area outside all cities in the borough and the council acting for the area in a city may regulate, fix, establish, and change the rates and charges imposed for a utility service provided to the municipality or its inhabitants by a utility that is not subject to regulation under AS 42.05 unless that utility is exempted from regulation under AS 42.05.711(a), (d) - (k), (o), (p), (r), or (u). (b) A municipality may provide for a reasonable deposit for meters and service to be given if interest is paid on the deposit. (c) Unless the utility is owned by the municipality, all rates, charges, and regulations established under this section shall be established by ordinance and shall be reasonable and permit a fair return on invested capital. (d) This section applies to home rule and general law municipalities.
Alaska Legal Code