20050209Application.pdf

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John R. Hammond, Jr., ISB No. 5470
BATT & FISHER, LLP
S. Bank Plaza, 5th Floor
101 S. Capitol Boulevard
Post Office Box 1308
Boise, ID 83701
Telephone: [phone]
Facsimile: [phone]
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Attorney for Terra Grande Water
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF TERRA GRANDE
WATER REQUESTING THAT THE
COMMISSION AUTHORIZE INTERIM
RATE RELIEF AND FURTHER
PROCEEDINGS TO ESTABLISH JUST
AND REASONABLE RATES
Case No. TGW-O5-
APPLICATION
COMES NOW Terra Grande Water (the "Company" or "Terra Grande ) and makes this
Application to the Idaho Public Utilities Commission ("Commission ) for an Order approving
interim rate relief that would increase the Company s current rates and charges for water service
in the State of Idaho. The Company requests that these rates be changed immediately. The
Company requests this immediate authorization to change its rates based on an emergency that
was beyond Terra Grande s control and has unexpectedly increased the Company s expenses on
short notice. See Idaho Code 9 61-307; IDAPA 31.01.01.121 & 122.02. In addition, once more
data regarding the Company s operations is developed, Terra Grande requests that the
Commission adjust or true-up any interim rate previously set to establish just and reasonable
rates going forward. If necessary, to preserve any amounts for possible future recovery, Terra
Grande requests that it be authorized to use deferred accounting methods to track excess costs.
APPLICATION, P. 1
ORIGINAL
Terra Grande requests that the Commission process its Application and request for
interim rate relief expeditiously. Finally, Terra Grande requests that the Commission process the
Company s request for more permanent rate relief by modified procedure under its Rules of
Procedure. IDAPA 31.01.01.201-204.
Terra Grande is a public utility water corporation within the meaning of the Idaho Public
Utility Law, is duly organized under the laws of the State of Idaho, and is engaged in conducting
a general water business in Boise, Idaho. The Company has provided water service to the Terra
Grande Subdivision for over 50 years. This Subdivision is located south of Overland Road, east
of Milwaukee Street, north of Targee Street and west of South Ash Park Lane in Boise. The
Company has its principal office and place of business at 10012 Eshelman Street, Boise, Idaho.
A copy of the Terra Grande s Articles of Incorporation is being provided with this filing as
Attachment A. Terra Grande s current Certificate is No. 429.
II.
Terra Grande currently has approximately 117 residential customers that it provides
water service to in the Terra Grande Subdivision in Boise, Idaho.
III.
Terra Grande customers are presently served under a two-season flat rate. This is
necessary due to the fact that the Company s customers are not individually metered. The
monthly summer rate for four months is $26 and the monthly non-summer rate for eight months
is $16, producing total annual revenue per customer of$232. A copy of Terra Grande s present
schedule of rates for water service is attached hereto as Attachment B.
APPLICA TION, P. 2
IV.
On January 18 2005 , the Department of Environmental Quality (DEQ) received test
results from all three of Terra Grande s supply wells indicating the presence of
Trichloroethylene, a hazardous chemical. The results from the initial testing ranged from ten to
nineteen times the Maximum Contaminant Level (MCL) for this chemical in a drinking water
system. See 40 C.R. 9 141.61 (a)(5)(MCLs for organic contaminants). Subsequent testing
confirmed these results.
In response to this problem, Terra Grande provided notice to all of its customers on
Friday, January 21 2005 , advising them to cease the use of water for drinking and to minimize
all other uses, such as bathing and showering. Terra Grande also began supplying bottled water
to its customers and arranged for them to purchase water at wholesale price from a Wal-Mart
located across Overland Road from Terra Grande Subdivision. In its notices, Terra Grande
communicated with its customers that it would provide them with a billing credit against future
bills. The amount of this credit has not been calculated, but the Company requests that in
establishing any reasonable amount that the Commission take into consideration that this was an
emergency situation not caused by the Company and that Terra Grande did everything in its
power to remediate the problem quickly.
VI.
Terra Grande and DEQ have not been able to identify the party responsible for the
contamination of the Company s water source. Terra Grande is currently working with DEQ to
help ascertain the cause of this contamination.
APPLICATION, P. 3
VII.
The high levels of Trichloroethylene contamination in Terra Grande s water forced the
Company to take immediate action to procure reliable and safe water for its customers in the
most expedient manner. As a result, Terra Grande worked with DEQ and United Water, Inc.
(collectively the "parties ) to remediate the contamination problem. The parties decided that
based on the current circumstances , the most expedient and cost effective method for
establishing a clean potable water supply to the residents of Terra Grande was for the Company
to directly connect to United Water s water supply system. DEQ generously provided funds
from the Idaho Hazardous Waste Emergency Response Fund to pay for the costs of this
connection.
VIII.
This connection consists of the following equipment: 1) a 3" inch meter installed in a
concrete vault; 2) 4" pipe connecting the United Water system to Terra Grande s; and 3) a
backflow device to prevent any residual contamination from the Terra Grande system from
entering into United Water s system. The connection was completed on January 28 2005 and
United Water began providing water service to the Company around 5:00 p., MST on that
same day under its current, Commission approved Schedule No.1 for General Metered Service.
IX.
Under United Water s Schedule No.1 for General Metered Service, the Company has a
customer charge for a 3" inch meter of $82.42 bi-monthly. This Schedule also contains a volume
charge for all water used per 100 cubic feet (CCF) of $.9825 in the winter and $1.2281 for the
APPLICATION, P. 4
summer.) United Water s summer rates apply for all water consumed between May 1 and
September 30 each year. United Water also assesses the following charges on its customers
bills: 1) a $.50 bi-monthly charge as required by DEQ to fund the agency s State Drinking Water
Program; and 2) a 3% Municipal Franchise Fee as required by the City of Boise. United Water
Schedule No.
REQUEST FOR INTERIM RATE RELIEF
As a result in the change in the manner and mode by which Terra Grande provides water
service to its customers, it must change its rates immediately in order to recoup its costs of
providing said water service. Terra Grande asserts that based on United Water s rates, the
Company s expenses will rise, making the Company s current rates unjust and unreasonable.
XI.
Terra Grande requests that in the interim the Commission allow the Company to continue
charging its customers $16 a month for water service based on the Company s filed Tariff. In
addition, the Company requests that it be authorized to add the costs of supplying water to its
customers using United Water s supply system to its existing flat rate. United Water will
calculate charges for Terra Grande and bill the Company bi-monthly using its Schedule No.1 for
General Metered Service. Once this bill is received by Terra Grande, the Company requests
authorization to pass this additional cost on to its customers. In the interim, Terra Grande
proposes to calculate each of its customers' share of this cost by dividing the United Water bill
by the total number of Terra Grande customers. Thus, each customer would be billed an equal
I These rates are of course subject to change as a result of United Water s current rate case before the Commission.
Any change from current rates will of course necessitate further Terra Grande rate adjustments.
APPLICATION, P. 5
amount for the overall United Water bill that Terra Grande will receive in the future. Currently,
Terra Grande bills its customers in advance for two months of service.
XII.
A simple illustration can be made using United Water s average consumption per
residential customer as stated in the Company s Tariff of 208.75 ccf for the year ending 1998.
See United Water Schedule No. IE. Assuming the use of a 3" meter and a 65%/35% summer
winter split, each Terra Grande customer s portion of the United Water bill would be $241.
annually or $40.30 bi-monthly. Adding Terra Grande s existing flat rate for water service in the
winter would increase each customer s bi-monthly bill to $72.30 for the winter months. This of
course could be higher or lower based upon what the actual usage is recorded by the 3" meter
each billing period.
XIII.
If approved, Terra Grande will immediately file a Tariff reflecting any changes to its
rates and charges.
XIV.
Notice to the Company s customers concerning this interim and more general rate request
is being accomplished by news media releases simultaneously with the filing of the Application
and by individual notice mailed to each of Terra Grande s customers. This Notice is attachedto
this Application as Attachment C. In addition, a copy of the Company s Application is available
for public inspection at its office located at 10012 Eshelman Street, Boise, Idaho. The Company
has requested that anyone requesting to see the Application at its offices call 322-2509 between
8:00 a.m. to 5 :00 p.
APPLICATION, P. 6
xv.
Based on the foregoing, the Company asserts that it has shown good cause for the
Commission to approve its request for interim rate relief. Accordingly, Terra Grande requests
that the Commission grant it interim rate relief based upon the proposal previously discussed on
less than thirty (30) days notice, making these rates effective as of the filing date of this Petition.
FURTHER PROCEEDINGS TO ESTABLISH RATES
XVI.
If the Commission grants the Company s request for interim rate relief, it then also
requests that the Commission allow further proceedings in conjunction with its investigation in
Case No. TGW-04-1 to establish just and reasonable rates for Terra Grande s customers on a
going- forward basis once more detail is developed regarding the Company s operations.
XVII.
Because the interim rate relief will likely be adjusted due to further proceedings, the
Company requests that it be granted Commission authorization to defer any excess water supply
costs in the event that the Commission establishes rates based on an estimated United Water
volume charge. The Company requests such treatment until new rates are implemented that
provide for recovery of excess water supply costs. This, of course, is moot if the Commission
allows the Company to recover its actual costs as determined by United Water billings going
forward.
XVIII .
Terra Grande stands ready for immediate consideration of its Application and requests
that the Commission considers its merits expeditiously.
APPLICATION, P. 7
XIX.
Communications in reference to this Application should be addressed to:
John R. Hammond
Batt & Fisher LLP
101 S. Capitol Blvd., Suite 500
Boise, Idaho 83702
(208)-331-1000
Fax: [phone]
irh~battfisher.com
and
Barbara V. Child
10012 Eshelman Street
Boise, Idaho 83701
208-322-2509
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WHEREFORE, Terra Grande respectfully requests of the Commission:
APPLICA TION, P. 8
That this Application be heard and acted upon at the earliest possible date;
That the Commission find that Terra Grande s existing rates are unjust
unreasonable and insufficient to provide the Company the recovery of its costs
and a fair rate of return, and that the revised rates and charges proposed in this
Application are just and reasonable on an interim basis. Terra Grande requests
that the Commission permit the Company to charge its customers these rates
effective upon the receipt of its first bill from United Water.
The Commission establish further proceedings to establish just and reasonable
rates for Terra Grande s customers.
Deferred accounting treatment for excess water supply costs above interim rates if
appropriate.
That the Commission grant such other and further relief as the Commission may
determine proper in the circumstances.
DATE this 9th of February, 2005.
BATT & FISHER, LLP
mmond, Jr.
ey for Terra Grande Water
APPLICATION, P. 9
CERTIFICA TE OF SERVICE
I HEREBY CERTIFY that on this 9th day of February, 2005, I caused a true and correct
copy of the above and foregoing document to be served, in the manner indicated, on the
following:
Dean J. Miller
Attorney for United Water of Idaho, Inc.
MCDEVITT & MILLER LLP
420 West Bannock Street
O. Box 2564-83701
Boise, Idaho 83702
APPLICATION, P. 10
Hand Delivery
~ U.S. Mail
Facsimile
Federal Express
IDSOS Document Page 1 of 1
FILED EFFECTIVE
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1,)ARTICLES OF INCORPO~JON
TERRA GRANDE WATER, INC.
The undersigned, acting as incorporator of a corporation under the Idaho Business
Corporation Act, adopts the following Articles of Incorporation tor this corporation:
First: The name of tillS corporation i:'\ Terr" Grande JJ;ater, In,'
Second: The address of the initial registered office of Lhis corporation is 10012 Eshelman
Street Boise, Idaho 83704. The name of the initial registered agent at such address is Barbara
Chester-Child.
Third; That the total authorized number of shares of c.ommon stock of this corporationshall he .HVl~ Hundred (500) shares~ each of no par value.
Fourth: The name and address of the incorporator are as follows:
Name Address
Barbara Chester-Child 10012 Esheiman Street
Boise. Idaho ~3 704
IN \VI1NE~S WHEREOF. 1 have executed these Articles of Incorporation this
--LQ day of August. 2004.
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Barhara Chestcr-( :~hild
.Incorporator
ART1C1 ,FS OF If\CORPOI(ATrON
1- SECEMY Of STATE83/17/2984 8518.
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EXHIBIT
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http:/ /www.accessidaho.org/public/sos/corp/search.htmi ?ScriptF orm.startstep=docview&Sc...2/8/2005
Tariff No.Page IDAHO PUBLIC UTILITIES COMMISSION
APPROVED EFFECTIVE
I . P . U . C. No.
AUG 1 0 '04 AUG 1 0 '
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t--Ih SECRETARY
(Approval Stamp)
Canceling
Name of Utility
TERRA GRANDE WATER
SCHEDULE NO.
Customer Charges:
Winter Base Rate:$16.00 per month for September thru April
The Company shall follow the "Rules and Regulations of the Idaho Public Utilities Commission
Governing Customer Relations of Natural Gas, Electric, and Water Public Utilities Under the
Jurisdiction of the Commission.
Approved by Commission Order No. 29512
Issued 2004 Effecti ve 2004
Issued by TERRA GRANDE WATER
Title mA'N\wf'"\ b ~MJ.
EXHIBIT
Tariff No.Page IDAHO PUBLIC UTILITIES COMMISSIONAPPROVED EFFECTIVEI . P . U . C. No.
Cancel ing
Name of Utility
JUN8
- '
JUN 8 -
TERRA GRANDE WATER
dl SECRETARY
rF (Apfjroval Stamp)
SCHEDULE NO.
Customer Charges:
Summer Base Rate:$26.00 per month for May thru August
The Company shall follow the "Rules and Regulations of the Idaho Public Utilities Commission
Governing Customer Relations of Natural Gas, Electric, and Water Public Utilities Under the
Jurisdiction of the Commission.
Approved by Commission Order No. 29512
Issued 2004 Effecti ve 2004
I ssued by TERRA GRANDE WATER
Title ()W)\w
IMPORTANT NOTICE FOR TERRA GRANDE WATER
SYSTEM CUSTOMERS REGARDING RATE CHANGES
On February 9, 2005 Terra Grande filed an Application with the Idaho Public
Utilities Commission ("IPUC") requesting to increase rates for water service provided to
its customers. The proposed request is based on Terra Grande s recent connection to the
United Water of Idaho, Inc. supply system to procure reliable and safe water service for
its customers. This connection was completed on January 28, 2005, whereupon United
Water began selling water to Terra Grande for resale to its customers. Because United
Water s rates for water service are higher than the rates Terra Grande charges its
customers the Company has requested that the IPUC authorize it to increase its rates.
In the interim Terra Grande has requested that the IPUC authorize the Company
to continue to charge its customers its currently approved winter rates of $16.00 per
month. In addition, to these charges, the Company has requested that it be allowed to
pass on the actual costs it incurs from procuring water supply from United Water for its
customers.
Because the actual consumption of water from the United Water supply system
has not been measured yet an illustration of Terra Grande s proposal is provided. Using
United Water s average consumption per residential customer as stated in the Company
Tariffs of208.75 ccf, and assuming the use of a 3" meter and a 65%/350/0 summer winter
split estimated customer rates can be calculated using United Water s winter volume
charge of $.9825 and customer charge of 82.49 bi-monthly for one 3" meter. The
resulting Terra Grande customer s portion of the United Water bill would be $241.79
annually or $40.30 bi-monthly. Adding Terra Grande s existing flat rate for water
service in the winter would increase each customer s bill to $72.30 for the winter months.
This of course could be higher or lower based upon what the actual usage is recorded for
each billing period.
Terra Grande also wishes to notify its customers that water usage is now being
measured by a 3" meter installed by United Water. Accordingly, all actual usage will be
billed to Terra Grande and in turn the Company proposes to pass these costs on to its
customers. Thus, the Company requests that its customers engage in any reasonable
methods by which they can conserve the use of water. The Company believes that
conservation efforts will help to reduce the impacts of any proposed rate increase.
This request to increase rates for water service is subject to public review and a
decision by the IPUC. Copies of the filing are available at the Company s offices and the
office of the IPUC.
In addition to this request Terra Grande has also requested that the IPUC set just
and reasonable rates to replace and/or adjust any interim rate that it may approve for the
Company after the Company s operations are thoroughly analyzed.
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EXHIBIT