HomeMy WebLinkAbout20020329_sw.docDECISION MEMORANDUM
TO: COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
JEAN JEWELL
RON LAW
LOU ANN WESTERFIELD
RANDY LOBB
DON HOWELL
DAVE SCHUNKE
BOB SMITH
MICHAEL FUSS
MARGE MAXWELL
TONYA CLARK
BEV BARKER
GENE FADNESS
WORKING FILE
FROM: SCOTT WOODBURY
DATE: MARCH 29, 2002
RE: CASE NO. SWS-W-01-1 (Stoneridge Water)
SALE OF WATER COMPANY
On December 21, 2001, the Idaho Public Utilities Commission (Commission) received an Application apprising the Commission of the sale of the Stoneridge Water System and requesting that existing Certificate of Convenience and Necessity No. 365 in the name of Keith Garner dba Stoneridge Water System be cancelled and a new certificate for the service area be issued to CDS Stoneridge Associates-Land, LLC (CDS). CDS is a Utah Limited Liability Company qualified to do business in Idaho dba Stoneridge Water Company. Reference Idaho Code § 61-526; IDAPA 31.01.01.111. The Application (as amended by letter dated February 01, 2002) also requests approval of a reconnection fee of $50 or at the customer’s option, a $14 stand-by fee for each month during the period of discontinued service. No other change in rates or charges is requested.
Accompanying the Application are copies of:
A Purchase and Sale Agreement between Keith Garner and Cully W. Davis (or related assigns) dated November 8, 2000 together with an addendum dated December 22, 2000.
A Bill of Sale dated March 29, 2001.
A Special Warranty Deed dated March 29, 2001 bearing the stamp of the Bonner County Recorder indicating it was filed as Instrument No. 579483 on April 2, 2001.
An inventory of Real Property transferred in the sale.
An inventory of Personal Property transferred in the sale.
A set of Financial Statements for purchaser for October 2001.
A Certificate of Existence for CDS Stoneridge Associates-Golf, LLC from the State of Utah.
An Application for Registration of Foreign Limited Liability Company bearing the stamp of the Idaho Secretary of State.
Commission Notices of Application and Modified Procedure in Case No. SWS-W-01-1 issued on February 8, 2002. The deadline for filing written comments was March 1, 2002. All customers were provided with a copy of the Commission’s Notice. The Commission Staff was the only party to file comments.
The Stoneridge Water System is a public utility providing water supply to the Stoneridge golf resort community near the town of Blanchard, in Bonner County, Idaho. Commission Staff notes that CDS has been operating this water system since January 1, 2001 and that CDS has retained the employee responsible for the operation and maintenance of the system. Staff believes that CDS has demonstrated both the financial and technical ability to operate and maintain the water system. Staff recommends that CDS be directed to segregate the water system operation from the other business activities of CDS. Staff further recommends that all water system assets be separately identified and that an accounting system consistent with the Commission’s Annual Report Form be established.
As reflected in Staff’s comments, Staff researched Commission case files and discovered that a reconnection rate was approved by Commission Order No. 28376 in Case No. SWS-W-00-1. That Order approved reconnection fees of $14.00 during office hours and $28.00 for after office hours. The owner, Keith Garner, was directed to file tariff sheets consistent with the Order. Mr. Garner, Staff contends, never filed the tariff nor did he provide the information to the buyer. Staff has discussed these rates with the Applicant’s representative, Mr. Roger Sanders, who has agreed that the rates approved by Order No. 28376 are acceptable for the time being.
Staff recommends the following:
Certificate No. 365 issued to Keith Garner should be cancelled.
A new Certificate should be issued to CDS Stoneridge Associates-Land, LLC dba Stoneridge Water Company.
3. The Applicant should be directed to establish an accounting system for the water system separate and distinct from all other business activities.
4. The Applicant should be informed that pursuant to Commission Rule 103 for small water companies, no value will be placed on the water system assets for ratemaking purposes.
The proposed rate schedule for disconnection and reconnection charges should not be approved. The Commission should reaffirm the existing reconnection rates ($14 and $28). The two-day advance notice for a customer to request disconnection is reasonable, but a written request should not be required.
The Applicant should be directed to file new tariff sheets, signed by an authorized representative, reflecting the name of the new owner.
The Applicant should be required to adopt the Commission’s Utility Customer Relations Rules (IDAPA 31.21.01, Customer Information Rules (IDAPA 31.21.02) and Small Water Company Policies (IDAPA 31.36.01).
Commission Decision
Staff recommends approval of the proposed sale, as conditioned above. Does the Commission find it reasonable to approve the sale as proposed by Staff? If not, what is the Commission’s preference?
Scott D. Woodbury
bls/M:SWSW0101_sw
DECISION MEMORANDUM 3