20040608Notice of Investigation Order No 29512.pdf

Office of the Secretary
Service Date
June 8, 2004
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE INVESTIGATION
OF TERRA GRANDE WATER AND THE
ISSUANCE OF RELATED CERTIFICATE OF
PUBLI C CO NVENIEN CE AND NECESSITY
NO. 429.
NOTICE OF INVESTIGATION
CASE NO. TGW-O4-
ORDER NO. 29512
On February 19, 2004 in Case No. UWI-04-, United Water Idaho Inc. (United
Water) and Barbara V. Child dba Terra Grande Water (Terra Grande Water; Company) filed a
joint Application with the Idaho Public Utilities Commission (Commission) for an Order
approving the purchase by United Water of water service properties owned by Barbara V. Child.
As part of its diligent investigation United Water reached the conclusion that more investment
than anticipated would be required. United Water sought to amend the purchase agreement.
Terra Grande Water found the proposed amendment unacceptable. United Water elected to
rescind the agreement. Mutually agreeable terms of rescission have yet to be negotiated.
The Commission in this Order finds that Terra Grande Water is being operated by
Ms. Child in such a manner as to bring it within the jurisdiction of the Commission under Title
, Idaho Code; Idaho Code 99 61-124, 61-125, 61-129. We further find that the present and/or
future public convenience and necessity requires issuance of Certificate of Public Convenience
and Necessity No. 429 to Ms. Barbara V. Child dba Terra Grande Water. Reference Idaho Code
9961-526, 61-528; IDAPA 31.01.01.111. We authorize continued water service under the
existing flat rate.
BACKGROUND
Terra Grande Water has been operating for over 50 years and provides water service
to approximately 117 residential customers in the Terra Grande Subdivision in Ada County,
Idaho. Terra Grande is located south of Overland Road, east of Milwaukee Street, north of
Targee Street and west of South Ash Park Lane in Ada County. See Attachment to Certificate
No. 429. Terra Grande customers are presently served under a two-season flat rate. The
monthly summer rate for four months is $26 and the monthly non-summer rate for eight months
is $14 , producing total annual per customer revenue of $216.
NOTICE OF INVESTIGATION
ORDER NO. 29512
The results of Commission Staffs investigation of the Terra Grande water system
were set out in its comments filed in Case No. UWI-04-, which we incorporate herein by
reference. As reflected in those comments, Staff contacted the Idaho Department of
Environmental Quality (DEQ) to ascertain the status of the existing wells and water quality on
the Terra Grande system. DEQ reports that Terra Grande has not been monitoring and testing the
water according to the DEQ required schedules. There is no water treatment program on the
existing Terra Grande system. One of the four wells included in the Terra Grande water system
has not been used in a number of years due to the poor quality of its water. second well
currently exceeds the maximum radiological contaminate levels. A number of other
contaminates are presently borderline acceptable and may require treatment in the near future.
DEQ has required a number of repairs to the Terra Grande system which have not been made.
addition to the system improvements, the DEQ will require accelerated water quality testing due
to the failure of Terra Grande to perform the tests at the required intervals and because
contaminate levels identified are marginal. The first year s accelerated testing expense is
expected to be about $8 000. Those test results will determine the next year testing
requirements/costs. DEQ has delayed enforcement action toward Terra Grande awaiting the
outcome of this proposed sale.
The Commission is informed that (1) Terra Grande Water has retained an engineer to
assess the condition of its water system; (2) Terra Grande Water in meetings with Staff has
represented that the water system is in better condition than reflected in Staff comments; (3)
Terra Grande and the Department of Environmental Quality have agreed to a schedule of water
testing; and (4) Terra Grande has recently replaced a section of water pipe at a cost of
approxinlately $7 000.
Staff represents that further investigation is required in order to better assess the
quality of water, the physical condition of the water system and the economic viability of Terra
Grande Water. At this point .it is the Commission s understanding that Terra Grande is providing
water to all its customers.
COMMISSION FINDINGS
The Conlmission has reviewed and considered the filings of record in Case
No. UWI-O4-, and the representations of Staff in related public decision meetings of the
ConllTIission. Based on the established record and information provided, we find that Barbara V.
NOTICE OF INVESTIGATION
ORDER NO. 29512
Child dba Terra Grande Water is operating a water corporation in the Terra Grande Subdivision
in Ada County, Idaho and is providing water service to approximately 117 customers. Idaho
Code 99 61-124 and 61-125. We find that the Conlpany s customers have no say regarding
operation and management of the Company or the prices it charges for water. We find that Ms.
Child is operating Terra Grande Water as a public utility as defined by Idaho Code 9 61-629 and
in such a manner as to fall within the Commission s regulatory jurisdiction under Title 61 , Idaho
Code.
YOU ARE HEREBY NOTIRFIED that the Commission finds it reasonable to
conduct an investigation of Barbara V. Child dba Terra Grande Water pursuant to our statutory
authority and jurisdiction under Title 61 of the Idaho Code, specifically, Idaho Code 99 61-501
and 61-503. In particular, we note that our investigation will seek to establish:
(1) Whether the existing rates for water service are just and reasonable.
Reference Idaho Code 9 61-301.
(2) Whether Terra Grande Water furnishes, provides and maintains service
instrumentalities, equipment and facilities that promote the safety and
health of its patrons, employees and the public and is in all respects
adequate, efficient, just and reasonable. Reference Idaho Code 9 61-302.
Based on Staffs investigation and conlments in Case No. UWI-04-, our findings
above and the Conlpany s purported acquiescence to Commission jurisdiction, this Commission
finds it reasonable to issue Certificate of Public Convenience and Necessity No. 429 to Barbara
V. Child dba Terra Grande Water.Reference Idaho Code 99 61-526, 61-528; IDAPA
31.01.01.111.
Pending further investigation, the Commission finds it reasonable to direct Terra
Grande Water to continue providing water service at the Company s present flat rates. The
Company is directed to file formal tariffs setting forth the customer rates and charges we
approve. The Company is apprised that as a regulated utility all rates and charges of the utility
must be approved by the Commission and set forth in tariff schedules on file with the
Commission. Idaho Code 9 61-313. No other charges are permitted.
We further find it reasonable that Terra Grande Water be required to adopt and
implement the Commission s Customer Relations Rules (IDAPA 31.21.01.000 et seq.
),
the
Commission s Utility Customer Information Rules (IDAPA 31.21.02.000 et seq.
),
and an
NOTICE OF INVESTIGATION
ORDER NO. 29512
accounting system consistent with the information required by the Commission s annual report
for small water companies (Idaho Code 9 61-405).
The Commission further finds it reasonable to require Terra Grande Water to file a
written plan for any additional capital investment in the water system, with estimated costs and
proposed timing. No further capital investnlent in the water system is to be lnade without
Commission approval.
CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has authority and jurisdiction over Barbara V.
Child dba Terra Grande Water, a water utility, and the issues raised in Case No. TGW-04-
pursuant to Title 61 of the Idaho Code and the Commission s Rules of Procedure, IDAPA
31.01.01.000 et seq.
ORDER
In consideration of the foregoing and as more particularly described above, IT
HEREBY ORDERED and the Commission does hereby issue Certificate of Public Convenience
and Necessity No. 429 to Barbara V. Child dba Terra Grande Water for the water systeln
operated by the Company, located in the Terra Grande Subdivision, Ada County, Idaho.
IT IS FURTHER ORDERED and Terra Grande Water is authorized to provide
continued water service at the Company s existing two-season flat rate. The monthly summer
rate for four months is $26 and the monthly non-summer rate for eight months is $14. The
Company is directed to file a tariff schedule setting forth the Comnlission approved rates and
charges.
IT IS FURTHER ORDERED and Terra Grande Water is required to adopt and
iInplelnent the Coffilnission s Customer Relations Rules (IDAP A 31.21.01.000 et seq.
),
the
ConllTIission s Utility Custolner Information Rules (IDAP A 31.21.02.000 et seq.and an
accounting system consistent with the information required by the Commission s annual report
for small water companies (Idaho Code 9 61-405).
IT IS FURTHER ORDERED and Terra Grande Water is required to make written
Petition or Application to the Commission prior to any proposed change in ownership of the
water systenl.
NOTICE OF INVESTIGATION
ORDER NO. 29512
THIS IS AN INTERLOCUTARY ORDER. Any person interested in this Order may
file a Petition for Review within twenty-one (21) days of the service date of this Order with
regard to any matter decided in this Order. A Petition to Review may request that this
Commission: (1) Rescind, clarify, alter, amend; (2) stay; or (3) finalize this Interlocutory Order.
After any person has petitioned for review, any other person may file a cross-petition within
seven (7) days. See Rules 321 , 322, 323., 324, 325 (IDAPA 31.01.01.321-325).
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this fj#--
day of June 2004.
MARSHA H. SMITH, COMMISSIONER
ATTEST:
~ee1Co ission Secretary
vld/O:TGWW0401 sw
NOTICE OF INVESTIGATION
ORDER NO. 29512