20140529final_order_no_33044.pdf

Office of the Secretary
Service Date
May 29,2014
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE I ATTER OF MORNING VIEW )
WATER COMPANY’S APPLICATION TO )CASE NO.MNV-W-14-Ol
INCREASE ITS BORROWING )
AUTHORITY )ORDER NO.33044
____________________________________________________________________________________
)
On May 6,2014,Morning View Water Company (the “Company”)applied to the
Idaho Public Utilities Commission for an Order allowing the Company to increase the amount of
money that it is authorized to borrow from the Idaho Department of Water Resources (“IDWR”).
The Application attached documents including:(1)IDEQ Loan documents,Acceptance and
Agreement for Drinking Water Treatment Design and Construction;(2)a Budget Amendment
Request;(3)a General Service Contract between Rocky Mountain Power and the Company.On
May 19,2014,the Company amended its Application to seek even more borrowing authority.
Based on our review of the record,we issue this Order approving the Application as
noted below.
THE APPLICATION
In Order No.31061,Case No.MNV-W-lO-01.the Commission authorized the
Company to borrow $275,000 under the IDEQ’s Drinking Water Revolving Loan Program so it
could upgrade its water system and correct problems identified in a 2009 facility plan and
engineering report.With this Application,the Company seeks to increase that borrowing
authority to $410,000 so it can cover higher bid costs for the upgrade project,an administrator
for the project,and have Rocky Mountain Power install power to a well.The Company would
use the loan to fund various projects as follows:
I.Treatment and Distribution $355,000
2.Engineering $30,000
3.Administration and Legal $25.000
Total $410,000
The Company says its water loan qualifies for a 1 .25%interest rate,a loan repayment
term of 30 years,and a loan principal forgiveness of about $78,500.
ORDER NO.33044 1
STAFF REVIEW AND RECOMMENDATIONS
Staff reviewed the Company’s Application and believes the increased loan approval
will provide the Company with the capital it needs to make the improvements required by IDEQ.
Staff notes that the level at which the Company will recover the underlying costs from customers
will be evaluated in a separate proceeding when the Company completes the projects and applies
to change rates to reflect the investments.According to Staff,if the $410,000 loan,net of
principal forgiveness,is repaid in equal monthly payments and included in rates,the increase to
each customer could be around $11.50 per month.Staff says it will audit the final investment
cost records and the rate impact will be established in the next rate case(s).Based on its review
of the Application,Staff recommended the Commission:(1)approve the loan request up to
$410,000;(2)direct that the remaining terms of Order No.31061 be continuing;and (3)order
the Company to provide copies of the following:final loan documents with IDEQ;all
compliance reports and calculations that may be required;all approval letters;all executed
agreements for the loan;any amendments to the loan application;and the actual final costs in
summary format similar to the estimate prepared by 3H Construction or Aspen Engineers.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
The Commission has jurisdiction over the Company,a public utility and water
corporation,under Idaho Code §61-124,61-125.61-129,61-301,61-303,61-501-502,61-901,
and the Commission’s Rules of Procedure,IDAPA 3 1.01.01.000 et seq.Based on what we have
been provided,we find that the Company satisfies the requirements of Idaho Code §§61-901 et
seq.and the Commission’s Rules of Procedure 141-150,IDAPA 31.01.01.141-150,and that the
Company’s Application to increase its IDEQ borrowing authority should be approved.
We find the purpose of the requested borrowing authority is appropriate and that it is
reasonable and prudent to increase the Company’s borrowing authority from the amount set in
Order No.31061 to $410,000 so the Company can continue making necessary upgrades to its
water system.We find that the terms of Order No.31061 should otherwise continue.In
addition,we find it reasonable to direct the Company to expeditiously submit copies of:the final
loan documents with IDEQ;all compliance reports and calculations that may be required;all
approval letters;all executed agreements for the loan;any amendments to the loan application;
and the actual final costs in summary format similar to the 3H Construction estimate and the
engineering estimate prepared by Aspen Engineering and referenced in Order No.31061.
ORDER NO.33044 2
The issuance of this Order granting additional borrowing authority to the Company is
not a finding of fact or a conclusion of law that the particular use to which these funds are to be
put is approved by this Order.The issuance of this Order also does not constitute agency
determination or approval of the type of financing or the related costs for ratemaking purposes.
The Commission does not have before it for determination in this case,and thus does not
determine,the effect of issuance on rates to be charged by the Company for service to consumers
in the State of Idaho.
ORDER
IT IS HEREBY ORDERED that the Company’s Application to increase its
borrowing authority from the levels allowed by Order No.31061 is granted.The Company is
authorized to borrow up to $410,000 under the IDEQ’s Drinking Water Revolving Loan Program
so it can make necessary upgrades to its water system.The remaining terms of Order No.31061
shall otherwise continue in full force and effect.
IT IS FURTHER ORDERED that the Company shall,promptly upon receipt,submit
copies of the following documents to the Commission:the final loan documents with IDEQ;all
compliance reports and calculations that may be required;all approval letters;all executed
agreements for the loan;any amendments to the loan application;and the actual final costs in
summary format similar to the above-referenced engineering estimate.
IT IS FURTHER ORDERED that the issuance of this Order does not constitute
acceptance of the Company’s exhibits or other material accompanying this Application for any
purpose other than the issuance of this Order.
IT IS FURTHER ORDERED that nothing in this Order or any act or deed performed
in connection with this Order shall be construed to obligate the State of Idaho to pay or guarantee
in any manner whatsoever any security authorized,issued,assumed or guaranteed under the
provisions of this Order.
IT IS FURTHER ORDERED that this authorization is without prejudice to the
Commission’s regulatory authority regarding rates,service,accounts,evaluation estimates or
determination of costs or any other matter which may come before the Commission pursuant to
its jurisdiction and authority as provided by law.
THIS IS A FINAL ORDER.Any person interested in the Order (or in issues decided
by this Order)may petition for reconsideration within twenty-one (21)days of the service date of
ORDER NO.33044 3
this Order with regard to any matter decided in this Order and in this case.Within seven (7)days
after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §61-626 and 62-619.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this 9 “
day of May 2014.
ATTEST:
PA1.K.JFI.I/\\T)R PRLSIl)LN1’
/1 /‘/9.,ifJeanDJewell
Commission S&retary
O:MNV-W-14-0 lkk
MARSHA H.SI
ORDER NO.33044 4