20180501Application.pdf

Michael C. Creamer,ISB #4030
GIVENS PURSLEY LLP
601 W. Bannock St.
P.O.Box2720
Boise, Idaho 83701-2720
Telephone: [phone]
Facsimile: 208-388-1300
mcc@ qivenspursley. com
Attorneys.for SUEZ Water ldaho Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISION
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IN THE MATTER OF THE JOINT
APPLICATION OF UNITED WATER
IDAHO INC., AND BRIAN SUBDMSON
WATER USERS ASSOCIATION FOR
APPROVAL OF AN AMENDMENT TO
CERTIFICATE OF PUBLIC
CONVENIENCE AND NECESSITY NO.
143; APPROVAL OF AN AGREEMENT
FOR CONNECTION AND TRANSFER OF
WATER SYSTEMS; APPROVAL OF
RATES AND CHARGES
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SUEZ WATER IDAHO INC.'S (fna
UNITED WATER IDAHO INC.)
MOTION FOR FINAL TRUE.UP OF
COSTS, RATES AND CHARGES
AIID APPROVAL OF TARIFF
SCHEDULE
SUEZ Water Idaho Inc., (fna United Water Idaho Inc.) ("SUEZ") respectfully
submits this Motion for Final True-Up of Costs, Rates and Charges and Approval of
Tariff Schedule pursuant to the Commission's December 17,2014 Order No. 33195
issued in Case No. UWI-W-14-01, and Commission Rule of Procedure 133, IDAPA
3 1 .01 .01 . I 3 3 . This request is supported by the Supplemental Direct Testimony and
supporting papers of Gregory P. Wyatt ("Supplemental Testimony") submitted
contemporaneously herewith.
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 1
BACKGROUND
A. The SUEZ/Brian Application.
On September 29,2014, SUEZ and Brian Subdivision Water Users' Association
(BSWUA) filed an application ("Application") with the Commission seeking an Order
authorizing SUEZ to connect to, and take over operation of, BSWUA's domestic water
system. This request arose because BSWUA found it infeasible to fund the necessary
costs to eliminate identified contaminants in its ground water wells. BSWUA and SUEZ
entered into an agreement by which SUEZ would connect its own public water system to
BSWUA's customers, and take over the system and water service to its customers. The
agreement contemplated that SUEZ would extend a pipeline from its Columbia Service
Level under the New York Canal and the Boise River to connect with the eastern end of
SUEZ's mainline serving the Barber Service Level.
SUEZ estimated it would cost $1 ,340,209 for SUEZ to connect to the BSWUA
system, including approximately $1,215,184 in pipeline costs and $125,026 in service
and meter costs. Their Application proposed, among other things, that:
1. BSWUA customers would pay for 10% of the trued-up pipeline costs and pay
an extra $124.86 on their water bill every two months for ten years or, at the
customer's option, by making a one-time payment;
2. With respect to costs allocated to SUEZ's customers, SUEZ would: 1) defer
recovery of those costs and continue to accrue allowance for funds used
during construction ("AFUDC") until included in rates; and 2) include those
costs in the base rates it seeks in its next general rate case (including the return
on investment amount as calculated at the end of the year and not as a 13-
month average);
3. SUEZ would file a conforming tariff specifying the terms of service for
customers in the Brian Subdivision.
SUEZ WATER IDAHO INC.'S MOTION F'OR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE.2
B. Commission Order 33195.
The Commission issued Notice that the Application would proceed under modified
procedure and provided the opportunity to file public comments. BSWUA customers,
IDEQ, the Boise Fire Department and the Commission Staff filed written comments.
Based on the record, including testimonies submitted with the Application and the
submitted comments, the Commission concluded that it is in the public interest to
authorize SUEZ to connect its system to BSWUA's system and authorizedSUEZ to take
over service to BSWUA's customers on the following terms:
l. SUEZ to provide Staff with quarterly construction reports, including construction
progress made with associated costs;
2. Once connected to SUEZ, SUEZ would charge BSWUA customers pursuant to SUEZ's
Rate Schedule No. 1;
3. After an audit of the project is completed, SUEZ would apply a 1O-year surcharge to
Brian Subdivision customers to cover the entire trued-up costs of updating the BSWUA
system to SUEZ standards, and 10oh of the trued-up costs of the main line installation to
connect the systems;
4. BSWUA customers are to be afforded the opportunity to opt to pay the present value of
the remaining surcharge payments in a lump sum at any time during the surcharge time
frame. BSWUA customers must make their initial payment option election (surcharge or
present value lump sum) within 30 days of connecting to SUEZ's system;
5. If a currently unconnected Brian Subdivision resident wants to connect to the system, that
resident will not be subject to the surcharge for the remaining surcharge period, including
the option of a lump sum payment. The surcharge amount assessed against the existing
BSWUA customers will be calculated to fully support the portion of costs allocated to
BSWUA customers;
6. SUEZ is to use the following accounting treatment for the project
SUEZ will record capitalized plant investments subject to audit in a separate
subaccount. To the extent they occur, non-capital related expenses associated with
the project are to be recorded in a separate deferred account for future
consideration by the Commission;
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 3
a
a All capitalizedproject construction expenditures not supported through revenue
collected from the surcharge will continue to be subject to AFUDC until included
in rates. This portion of the expenditures refers to the 90% of the trued-up costs of
the main line installation to connect to the system; and
When the project is included in rates, it will not be subject to the l3-month
average methodology but will be included in rates for the full year.
7. SUEZ is to offer Budget Billing to former BSWUA customers on the same terms as all
other SUEZ customers, as reflected in SUEZ's Rule No. 47; and
8. All former BSWUA customers are to be sent a letter defining the surcharge amount
and payment terms as well as the available payment options once the final terms and
conditions of the surcharge have been approved, and before initial billing.
Commission Order 33195 authorized SUEZ to connect to the Brian Subdivision and provide
service to former BSWUA customers as provided above. The Commission also directed SUEZ to
submit semi-annual reports to the Commission discussing the status of arrearages and payment plans
for former BSWUA customers. Prior to charging any former Brian Water customers for service,
SUEZ is required to file conforming tariffs, including a revised form of tariff Schedule lC in the
form recommended by Staff.
C. SUEZ's Implementation of Service Connection and Compliance with Order 33195.
As more fully discussed in Mr. Wyatt's Supplemental Testimony, SUEZ commenced construction of
the new interconnecting pipeline in January 2015 with an initial directional bore under the New York
Canal. Due to geotechnical and mechanical difficulties, SUEZ's contractor was unable to complete a
successful bore under the Canal in 2015 and2076. All boring and interconnection work to deliver
water to all 46 BSWUA customers, including service lines, meter vaults, meters and testing were
completed in November 2017, and the system was placed in service at that time. Customers in the
Brian subdivision have been receiving water from SUEZ under SUEZ's normal residential metered
tariff since November 2017. Since construction initially began in January 2015, and including the
construction delays, SUEZ submitted quarterly progress reports to the Commission Staff in May
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 4
a
2015, October 2015, January 2016, October 2016, February 2017, April2017 , July 2017 and
November 2017.
As indicated by the progress reports filed with the Commission, and for the reasons described
in detail in Mr. Wyatt's Supplemental Testimony, actual project costs exceeded original onsite and
offsite estimates by $351,967 attributable primarily to the unanticipated bore piping construction
difficulties encountered and resulting delays that affected the bid price for the pipeline work. Onsite
costs (i.e., within the Brian Subdivision) totaled $304,824, exceeding estimated costs by $58,280.
This additional costs are detailed in Mr. Wyatt's Supplemental Testimony.
By this Application, SUEZ is requesting Commission consideration and treatment of actual
project costs consistent with Order 33195 and as discussed in detail in Mr. Wyatt's Supplemental
Testimony.
SUEZ also requests Commission approval of, Schedule No. lC Brian Subdivision Surcharge
in the form attached as Exhibit No. 8 to Mr. Wyatt's Supplemental Testimony. Schedule No. lC
incorporates a trued-up bimonthly surcharge reflecting SUEZ's actual onsite costs to update the
BSWUA system to SUEZ standards payable over ten years from the date of their election to spread
the payments in lieu of the one-time payment option, from that date.
SUEZ will be mailing a notice of this filing to BSWUA customers substantially in the form
attached as Exhibit No. 9 to Mr. Wyatt's Supplemental Testimony. If the Commission approves
Schedule No. lC, SUEZ is prepared to send each of its BSWUA customers a letter defining the
surcharge amount, payment terms and the available payment options in the form attached as Exhibit
No. l0 to Mr. Wyatt's Supplemental Testimony.
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 5
REQUEST FOR MODIFIED PROCEDURE
SUEZ believes that a hearing is not necessary to consider and resolve the issues presented
by this filing and requestslhat it be processed under Modified Procedure.
DATED this / day of May 2018.
GIVENS PURSLEY LLP
By:
Michael C. Creamer
Attorneys for SUEZ Water ldaho Inc.
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE-UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 6
.fiD-I HEREBY CERTIFY that on the / day of May 2018 I caused an original and seven
(7) copies of the Motion and an original and nine (9) copies of Supplemental Testimony of
Gregory P. Wyatt to be served upon:
CERTIFICATE OF SERVICE
Diane Hanian, Secretary
Idaho Public Utilities Commission
472 W . Washington Street
Boise, lD 83702
by hand delivering the same to the above-named at the last known address(s) as set forth above.
I also served true and correct copies to the address listed below via regular mail:
Richard Juengling
President, Brian Sub Water Users
5855 E Wood Place
Boise, ID 83716
Email : [e-mail]
Michael C. Creamer
SUEZ WATER IDAHO INC.'S MOTION FOR FINAL TRUE.UP OF COSTS, RATES AND CHARGES
AND APPROVAL OF TARIFF SCHEDULE - 7