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HomeMy WebLinkAbout20080520Pinardi Direct.pdfORIGINAL 20 PH \: 04 Dean J. Miler (ISB No. 1968) McDevitt & Miler LLP 420 West Banock Street P.O. Box 2564-83701 Boise, Idaho 83702 208-343-7500 (T) 208-336-6912 (F) joe(ímcdevitt-miler.com Attorneys for Teton Springs Water & Sewer Company LLC. BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE APPLICATION OF ) Case No. -iìS--w -08 -c TETON SPRINGS WATER AND SEWER ) COMPANY LLC, FOR THE ISSUANCE OF A ) CERTIFICATE OF PUBLIC CONVENIENCE ) AND NECESSITY, FOR APPROVAL OF ) RATES AND CHARGES FOR WATER ) SERVICE, FOR APPROVAL OF ) RULES AND REGULATIONS GOVERNING ) THE RENDERING OF WATER SERVICE. ) ) BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION DIRECT TESTIMONY OF JON PINARDI May 20, 2008 1 Q.Please state your name and business address. 2 A.My name is Jon Pinardi; my business address is: 3 Teton Sprigs Water and Sewer Company LLC., 75 W. 950 S. Ste 3, Victor, il 4 83455. 5 Q.What is your occupation? 6 A.I am the Director and Man~er of Teton Springs Water and Sewer Company LLC 7 ("Teton Springs" or "TSWS"). 8 Q.What is the purose of your testimony? 9 A.I wil descrbe Teton Springs' Application for a Certficate of Public Convenience 10 and Necessity and its request for approval ofinitial rates for water serce. 11 Background 12 Q.Please descrbe the area to which TSWS proposes to provide water serce. 13 A.Teton Springs will provide water serice to a planed unt development in Teton 14 County known as the Teton Springs Resort Community. The location of the 15 development is depicted on Exhbit C to the Application. 16 Q.Please discuss the history and character of the development. 17 A.The development was constrcted by Teton Springs & Golf & Casting LLC., 18 commencing in 2001. The development is an all-season resort communty. Most 19 of the homes within the communty are second or third homes for the owners. 20 The owner tend to be affuent as indicated by the fact that the sales price for lots 21 within the communty range from $252,000 to $2.8 milion. 22 Q.As par of the development, did the Developer constrct a water and sewer 23 system? Pinardi, Di 1 Teton Springs Water and Sewer Company LLC 1 A.Yes. The water system is fully capable of providing water servce to residents of 2 the development. It consists generally of two wells, a water storage reservoir, 3 water mains, hydrants and serce lines. The original cost of the water system 4 was approximately $2,882,000. 5 Q.Have the water system assets been transfered by Teton Springs & Golf & Casting 6 LLC., to Teton Springs Water and Sewer Company LLC? 7 A.Yes. Those assets were transferred on May 6, 2008. The executed transfer 8 documents are attached to my testimony as Exhbit 1. 9 Q.Why were the water and sewer assets transfered from Teton Sprigs & Golf & 10 Casting LLC., to Teton Springs Water and Sewer Company? 11 A.The transfer enabled the water and sewer operations to be separate from the 12 development fuctions to àvoid commingling of the revenue and expenses from 13 development operations witlitltilty operations. 14 Q. 15 A. Please describe the number of customers that wil be sered by TWSC? Within the development there are 581 single family building lots and 14 16 commercial lots. In addition, there are two multifamily dwellng customers which 17 wil contain 143 residential units at full build-out. 18 Q.Has the water system been approved by the Idaho Deparent of Environmental 19 Quality 20 A. 21 22 Q. Yes it has, and a Public Water System Number has been assigned. Rules and Regulations; Customer Forms Is Teton Springs proposing to adopt Rules and Regulations for Commission 23 approval? Pinardi, Di 2 Teton Springs Water and Sewer Company LLC 1 A. 2 3 Q. 4 A. 5 6 7 8 Q. 9 A. 10 11 Q. 12 13 A. 14 15 16 17 Q. 18 19 A. 20 21 22 Yes. The Company's proposed Rules and Reguations are attched to the Application as Exhbit F. Please descrbe how these rules were developed. The Rules and Reguations of United Water Idaho Inc., which have been approved by the Commission, were used as a template. Our rules are not as extensive as United Water's, but at this time, they do not need to be. We tred to keep the rules as simple as possible while minimizing ambiguity. Is the Company proposing to adopt rules for water main extensions? No. The water system is fuly built-out and it wil not be necessar to construct additional main lines to sere customers. Is the Company proposing to adopt cerain customer notice forms and biling statement? Yes. Attached to my testimony as Exhbit 2, are proposed terination notices and biling statement. These contain the information required by the Commission's Utility Customer Relations Rules. Financial Abilty Does Teton Springs have the bona fide intent and financial ability to provide water servce as a regulated utility? Yes. As noted above, Teton Springs is a subsidiar of Teton Springs & Golf & Casting LLC., and has accessto the necessar capital to enable it to operate the water system in a safe and reliable maner, assuming the Company is allowed to ear revenues sufficient to cover operational costs and produce a reasonable Pinardi, Di 3 Teton Springs Water and Sewer Company LLC 1 2 3 Q. 4 A. 5 6 7 8 9 Q. 10 A. 11 12 Q. 13 A. 14 15 16 Q. 17 18 A. 19 Q. 20 A. 21 22 Q. margin. Also as noted above, the water system is fuly built-out and accordingly, additional capital is not needed for constrction of system expansions. Does Teton Springs face operational challenges not faced by other utilties? Yes. The Teton Sprigs Development is a stand-alone property located in a remote par of Teton County. Winters are harh in the area creating additional maintenance and operation effort. Many of the dwellings are occupied only on a par time basis; accordingly water consumption vares dramatically thoughout the year. In what way are these considerations relevant to this Application? They explain, in par Teton Spring's comparatively high revenue requirement. Notice of Application Has Teton Springs provided notice of ths Application to its customer? Yes. Attached to my testimony as Exhibit 3 is the form of notice that wil be mailed to each of our customers at the time the Application is fied. Rates and Charges Is the Company requesting that the Commission approve initial rates and charges for water service? Yes it is. What are Teton Springs' curent rates for water servce? Curently, customers that are connected to the system and takng serce are charged $240 on a quaerly basis. Why are customers biled on quarerly basis, rather than monthly? Pinardi, Di 4 Teton Springs Water and Sewer Company LLC 1 A. 2 3 4 5 6 Q. 7 A. 8 9 10 11 12 Q. 13 A. 14 15 16 17 Q. 18 19 A. 20 21 As noted above, most of the homes withi the development are occupied only on a par time basis. In some months individual homes may have minmal or no consumption and the expense of monthly biling may exceed revenue from individual accounts. Quarerly biling minimizes biling expense and is more convenent for our customers. Why are customers biled on a flat-rate basis rather than on metered consumption? Because the system has bee in operation for only a short time, we do not have consumption data from metered sales that would perit calculation of a rate for metered service. After we have monitored consumption for a perod of time Teton Springs intends to apply to the Commission for authority to conver to rates based on metered consumption. What rates is the Company proposing for approval? For residential customers that are connected to the system and actively taking serce we are proposing a quarerly monthy rate of $150.00. For customers whose property fronts an existing main, but who have not connected to the system we are proposing an Availabilty Charge of$75.00 per quaer. In the Company's proposed Rate Schedule No.1, Flat Rate Servce, there is reference to an "Availabilty Charge". Please explain ths charge. The Availability Charge is a tate charged to each customer's premses located withn the Teton Springs Communty that can be connected to the Company's water system but which has not yet connected to the system. Pinardi, Di 5 Teton Springs Water and Sewer Company LLC 1 Q. 2 3 4 A. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Q. 21 22 23 Does an availability charge recognze the fact that it was necessar to install the entire water system and the front-end of development, rather than build it out over time? Yes. As a large scale mixed-use seasonal resort communty in a rual settng, to properly develop the land at a level that could be adequately marketed with the full breadth of residential tyes, and recreational amenities in place, it was necessar to install the entirety of the utilty infrastrctue generally at one time. In a typical residential development, the utilties are added in phases as propert is sold and homes are constrcted. In the case of typical developments, there is proportionality between the size and operational scope of the system and the number of users paying for the serce. In our situation, we must operate and maintain the full scale of the utilty, but with only a fraction of the potential users providing revenue into the system. There is no direct proportionality between the size and operating cost of our system and the number of "active" users. In our case only 35% of the users have built homes and, if those 35% were required to bear the full burden of the system, they would be required to pay an amount that would not be fair for them. In equality, therefore, we propose that an "availabilty" fee be paid by those propery owners that have not yet built homes, so the full burden doesn't fallon those that have. Does an availability charge recognze the fixed natue of water utilty system costs? Yes. The operating and maintenance costs associated with a water system are largely fixed. Typically, the only major variable expenses relate to the energy required to produce the water from the wells and the cost of disinfection which is Pinardi, Di 6 Teton Springs Water and Sewer Company LLC 1 2 3 4 5 6 Q. 7 A. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Q. 22 tied to the number of gallons produced. This creates the situation where the costs of operation are largely set, regardless of the number of customers. Again, if a small number of customemwere required to bear the full burden, without assistace from all of th potential users of the system, the cost would be grossly unfair to this smaller group. Would an availability charge help preserve the fiancial integrty of the utility? Yes. An availability fee would presere the fiscal integrty of the system, thereby ensurng that high quality water servces, meeting all curent and futue regulatory and safety requirements, are readily available when the lot owners are ready to build on their lot and connect to the system. Having readily available water serice is a benefit to all lot owners, irrespective of whether or not they are receiving water servce curently. Additionally, because the water has been installed to ever property to provide easy and immediate access to those owner when they desire it, having those owners not share in the burden of the utility may unjustly enrch them. If the financial viability of the system is jeopardized, and the availability of water serice and its quaity is compromised, this has a corresponding negative impact on all property owners, regardless of whether they are currently connected to the system. Once full or substantially full occupancy of the PUD has been achieved, it is anticipated that the availability fee can be substantially reduced or eliminated in its entirety. Would an availabilty fee recognize the seasonal natue of occupancy by some homeowners? Pinadi, Di 7 Teton Springs Water and Sewer Company LLC 1 A. 2 3 4 5 6 7 8 Q. 9 10 A. 11 12 13 14 15 16 17 18 19 Q. 20 21 A. 22 23 Yes. Because of the seasonal natue of our owners occupancy, many of them choose to tu their water servce on and off throughout the season when the home is not occupied. Without an availability fee, the system revenue stream would be adversely impacted and confidence in adequate revenues to maintain the fiscal integrty of the system would be compromised. In a typical residential subdivision setting, large number of users do not regularly discontiue water serice and cease payment. In our case, ths does occur. Does an availability fee recognze that some properies might not be improved until several years in th fúfue? Yes. Many owners of the 1ai have purchased for the purose of long-ter investment and speculation. Some have purchased with the intent of NOT developing the land, and keeping it in open space. Both of these situations add to the issue of considerable land not having homes constrcted for years, if not decades to come. Without these properies being developed and becoming active water users, again, in the absence of an availability fee as a means to share the operating burden, those who have chosen to develop would be treated unfairly by having an arbitrarly high cost for water servce and the fiscal integrty of the system would be jeopardized. Has Teton Springs sought exper assistance in the development of its revenue requirement and resulting rates? Yes. Mr. Larr Crowley has prepared a Cost of Service study which deterines the Company's revenue requirements. Mr. Crowley presents his study in Direct Testimony that is being filed with the Application. Pinardi, Di 8 Teton Sprigs Water and Sewer Company LLC 1 Q. 2 A. 3 4 5 6 Q. 7 A. Is Teton Springs involved in any litigation? Yes. The Company and the City of Victor, Idaho are involved in a dispute regarding sewer treatment and collection serices provided by the City to Teton Springs. A civil action is pending in the Distrct Cour of Teton County, Case No. 07-066. The Company's water operations are not affected by this litigation. Does that conclude your testimony? Yes it does. Pinardi, Di 9 Teton Springs Water and Sewer Company LLC 05105/08 ION 22: 23 FAX 7063980012 Vest's ia 002 ASSUMPTION AND INDEMNITY AGREEMENT This Assumption and Indemnty Agreement (ths "Agrement") is executed beeen Teton Sprigs Golf and Casti Club, LLC, a Wyoming lited liabilty company. hereinafer referd to as "Assignor" and Teton Sprngs. Water and Sewer Company. LLC, an Idaho limite liabilty company, hereby referrd to as It Assignee." RECITALS: A. Assignor is the owner of a culinar water system and the sewage collection system (the "Systemsff) located at Tetn Sprngs Plaed Unit Development situated in Teton County, Idao. B. Assignee is a wholly owned subsidia of Assignor. C. Assignor desirs to trfer to Assgn and Assingee desires to accept frm Assignor, all of the assets constituting the Systems. D. In connection wit the assignent of the Systems. Assignor wil trsfer cert contrctual obligations to Assignee, but wil only do so upon Assipee's express acceptace of the assignment and execution of this Agreement in order to indemnify Assignor of any libilty with respect to such contrtual obligations. AGREEMENTS: NOW, THEREFORE, in conideration of the mutu covenants contained herein, and for other good and valuable consideration, the reeipt an suffciency of which are hereby acknowledged, the pares herby agree as follows: 1. Assignment And Acceptace. Assignor assigs to assignee aU of Assignor's rights and obligations in all contrct, permts, licenses and certificates relatg to the Systems, including but not limited those identif'ied on the attched Exhbit A (all of which are referr to herein as the "Contrcts"). Assignee hereby accepts assigment of the Contracts and agrees to peñorm each of Assìgnr's obligations thereunder. 2. Indemnity. Assignee shall indemni, defend and hold haless Assignor for, from and agaist any and all claims. actions, suis. liabilties, daages, penalties, f'mes and costs, including but not limite to attrneys' fees and costs, (i) that may be brought against it in connection. wit the Contrcts or that Assignor may incur or pay by way of settlement, judgment or otherwis in connecton with any of the Contrts. If any claim, acon or suit Il?-Ø"/ Ex 1 PAG 1 01 '7 05/05/08 ION 22: 24 FAX 7063980012 Vest's ia003 alleging such liabilties, damges, pealties or fies is brought agaist Assignor. then Assignee shall defend the same at its expnse by counsel reasonably satisfactory to Assignor. 3. No Limitation. Assignee's liabiity under th Agrement is unlimite. 4. Enforcment Costs. If there is any litigation or other action taen by any par to enforce or interet any provisions of or rights arising unde this Agrement. the nonprevaiing part shall pay to the prevailing pa all costs and expenses incurr by the prevaiUng par. inludig but not limite to resonale attrney fees an costs. S. Entire Agreement. This Agreement sets fort the entire agrement of the partes with respect to the subject mattr hereof and sursedes all prior oral or wrtten agreemeÐts of the partes. This Agrement canot be altere or amended except by an inStrent in writig signed by the pares hereto. 6. Successors and Assigns. This Agrment is binding upon and inurs to the benefit of the paes hereto and their respective successor and assigns. 7. Headings. The headigs in ths Agreement ar for reference only and do not limit or deÏme the meang Qf any provisions of this Agrement. 8. SurvivaL. All of the representations, warties. agreements and indemnities set fort in ths Agreement shal surive the execution an delivery of this Agreement and any other instrments an documents execute and delivere in çonnection with ths Agrment. 9. Governing Law. This Agrement shan be govered by and constred and enforced in accordance with the laws of the Stte of Idao. IN WIESS WHEREOF, the pares have executed this Agreement to be effective as of the day of May, 2008. ASSIGNOR TETON SPRINGS GOLF AND CASTING CLUB,LLC By: 2 IN AGREEM Ex.. i PAG i OF 7 05/05/08 ION 22: 24 FAX 7063980012 Vest's ia 004 ASSIGNEE TETON SPRINGS WATER AND SEWER COMPANYt LLC By: Teton Springs Golf and Castig Club, LLC, managerBY:.~ AnthonyV1 Managing Member 3 INEM AGREEME r... i PAi 3 01'' 05/05/08 ION 22: 25 FAX 7063980012 Vest's ia 005 EXBIBITA ASSIGNED CONTRACTS i. The Water Main Easement grte by Pay T. RammeU and Corey T. RammeU, Limited Parership, as set fort in that certin Water Main Easent. recorded in the records of Teton County, Idao. as instrment no. 151595 and instent no. 152735. 2. All rihts, title and interest of Grantor in tht cerin Memoradum Of Water Tank Easement Agrement between Richad M. Jacobsen and Susan Jacbsen as trtees of the Richar and Susan Jacobsen Trust dated Apri 2. 1993 and Teton Sprigs Golf an Castig Club. LLC. recorded in the recor ofTemn County, Idao. as instent no. 151483. 3. All rights and obligations of Assigor under tht Wastewate Collection system and Treatment Facilties Use Agreement among Assignor, City of Victr and City of Driggs, dated May 19,200. 4. AU culinar water rights. includi but Bot lited to those evidenced by IOWR Permit no. 22-13178. 5. All nghts. title and interest of Grator in the customer list, any customer deposits, and customer service agreements of the water and sewer systems. 6. Grantor's Public Water Supply Perìt, Permit No. PWS 7410033 7. Grator's D EQ Cerficate issed by the Idao Deparent of Environmenta Quality. Certfiate No. 00-01-41 O;\WP.iAIDWS'l.l - 'I8l("-~v2., 4 IN AGRME p# Exan i PAG" OF 7 05/05/08 ION 22: 25 FAX 7063980012 Vest's ia 006 BILL OF SALE For Ten DoUar and oth good and valuale consideration paid to Teton Sprgs Golf and Casting Club, LLC. a Wyomi limite liilty copany, whose adre is 10 Headwater Drve, Victor, Idao, 83455, herin reerr to as ~'Gtor'\ th recipt and suffciency of which ar aclmowledec Grtor trfer, conveys an assigns to the Teto Spngs Wat and Sewer Compay, LLC, an Idao limite liabilty compay, herina refem to as "Grte", al of Grtor's riht, title an intet in and to th çert per prert lised in Exhbit A attached a1 inraed by refece (the "Pernal Propert"). The Pernal Pro does not inlud ites owned by third perns and leased to Grato, although it does include any leaehold intet of Grtor in and to the sae. Grr resets an wats to Grate th: (i) Grtor is the lawful owner of the Pernal Prop. (ii) Grtor has not enumbere the Pernal Prpert or consented to the crtion of any seurty inte in the Peronal Prope exce as disclose on Exhbit A; an (ii) th pens executig this Bil of Sale on behalf of Grato ar authored so to do and ar authoried to bin Grtor unde the te of ths BiU of Sale. The Persona Proper is sold in a used and an '"AS IS" condtion. Grto maes no warties, expres or imlied, of any ki (including, but not limite to: title; merhatailty; fitness for any pacula pur; design; codition; quaty; capityworkship; coority with applicale laws, ordce. nies or reguations; pat ingement; or late defects) to Gratee redig the Persona Prpe ex.ce as speifically se fort in this Bil of Sale. IN WITNSS WHREOF, Grato has execte this Bil of Sale ths ¿ (; day of Mayt2008. GRAOR: TETON SPRIGS GOLF AND CASTING CLUB,LLCBY:*Z~ thooy V Mang' embe Ex.. I PAG 5 Of 7 05/05/08 ION 22: 25 FAX 7063980012 Vest's BIL OF SAL EXIDBITA~Descrition Quantity Manufcturer Model 1 Markig Paint 30 varous nla 2 Hydrt wrench 2 nJa nla 3 Manole liftr 2 nla . nla 4 2" Valve ke .8'2 nla nla 5 2" Valve ke .15t ext i nla nla 6 Electrnic Locato 1 Sconte GA92XTd 1 Pocket Ci Photmete 1 HF Scientific poet 8 Measurg wheel 1 Stay wheel 9 2" valve Key-to' ext 1 nla nla 10 Cur stop key- 6'1 nfa nla 11 2.5" hose. SO.4 nla oIa 12 2.5" hose 100'4 nla nla 13 Barcade sign 2 nfa nla 14 2.Slt nozle i nfa 2.5" 15 2.5" gat valve i nla 2.5" 16 2.5" 9( degree fiUig 1 nla nla 17 2.5" 45 degr fittg 1 nla nfa 18 Misc. Handtols nla varous nla 19 I" met 48 Sen 1" 20 1ft Yoke asbly 35 Ford i ll 21 1" chk valve 40 Ford 1" 22 S" valve box ext 15 nfa S" 23 5" valve box ex 12 nla S" 24 Manole lids S Dla nfa 25 IDWR Permt 22-13178 26 An rights title and inerst of Grto in the cusmer list any cutomer deposits, an custmer seice ageements of the water an sewersytes.#~O:\'I.DA'JA'ÐW&\717..!. T.. ~1i(An.,..fe ~1...2.... 2 . BILL OF SALE ia 007 bI'" i 'ACZ '01 7 05/~5/08 ION 22: 26 FAX 7063980012 Vest's ia008 SPECIA WARRANTY DEED For the consideration ofTen Dollars ($10.00), and other valuable consideration. the receipt and sufficiency ofwhiçh arc acknowledged, Teton Springs Golf and Castig Club, LLC, a Wyomig limite liabilty company. hereinaftr referrd to as "Grantor", hereby conveys to Teton Spri Water and Sewer Company, LLC. an Idaho limited liabilty company, whose address is 10 Headwate Drive, Victor. Idaho 83445, hereinftr referred to as 4Orantee''. all ofìts right tite and inteest in and to the culiar water system and the sewage collection system located at Teton Spnngs Planncc Unit Development (the "PUD") situte in Teton County, Idaho. referred to hereafter as the Proper. Without limitig the foregoing, Grantor conveys to Grantee 1. the well lots descnbed on Exhibit A. 2. the Water system improvements described on Exhibit B, 3. the Sewer sys improvements described on Exhibit C, 4. all benefits and burens oftle easments descrbe on Exhibit D. 5. aU permits. licenses and certficates peini to the water and sewer systems. including but not limited to those described on Exhibit E. 6. . all benefits and bW'ens of all easements on the reorded plat of Teton Springs llanned Unit Development that ar uti for delivery of water and or sewer services to the Lot Owners within the PUD. 7. all rights and obligations of Grantor under that Wastewater Collecon system and Treatment Facilûes Use Agreement among Grantor. City of Victor and City of Dnggs, dated May 19, 200. Grtor binds itslf and its succesors to warnt and defend the title to the Prer against aU acts of Grantor and no other, subject to the matters set forth above. Dated this/.ay of May, 2008. GRANTOR: TETON SPRINGS GOLF AND CASTING CLUBj LLC By: ExHlmi PAG 7 OF 7 Teton Springs Water and Sewer Company LLC 75 West 950 South, Suite 3 Victor, Idaho 83455 Phone:(208)- Pax(208)- NOTICE OF INTENT TO TERMINATE SERVICES Customer Address Label Acct#: Pinal Date: Balance Due: Service Address: You were recently notified that you are delinquent in the payment of charges for Water Service provided by Teton Springs Water and Sewer Company LLC. The balance of your account, according to our records, is indicated above. In accordance with the rules and regulations of the Idaho Public Utilities Commssion, if this balance is not paid, or if payment arangements are not made by the Pinal Date shown above, then YOUR WATER SERVICE WILL BE DISCONNECTED after the Pinal Date. To avoid termnation you must contact Teton Springs Water and Sewer Company LLC., before the Final Date to make a payment arangements or pay in fulL. Please call on weekdays between a.m. and p.m. and ask for our water collection deparment. Termnation may be delayed by: 1. Providing a medical certificate advising us of the existence of a Medical Emergency. 2. Piling a complaint regarding the proposed termination with the Idaho Public Utilties Commission, PO Box 83720, Boise, Idaho 83720-0074, (800) 432-0369. Service wil not be termnated prior to resolution of a filed complaint. Termination of service in no way relieves you of your obligation to pay for all services prior to termnation. Should service be terminated, a charge for restoration of service ($ during office hours, $ other times) must be paid, plus the account balance prior to restoration of service. Teton Springs Water and Sewer Company LLC wil, one time, assist you by making payment arrangements not requiring immediate payment in full, if you contact us prior to the Final Date to arrange such a payment plan. Remember, your water wil be turned off after the Pinal Date unless you act before the Pinal Date. Teton Springs Water and Sewer Company LLC EXHIBIT i PAGE 1 OF 4 Teton Springs Water and Sewer Company LLC 75 West 950 South, Suite 3 Victor, Idaho 83455 Phone: (208)- Pax(208)- FINAL WATER SHUT OFF NOTICE Final Date: Name: Service Address: Acct #: Account Balance: You were recent! y notified that you are delinquent in the payment of charges for Water Service provided by Teton Springs Water and Sewer Company LLC. The balance of your account, according to our records, is indicated above. In accordance with the rules and regulations of the Idaho Public Utilities Commssion, if this balance is not paid, or if payment arangements are not made by the Pinal Date shown above, then YOUR WATER SERVICE WILL BE DISCONNECTED after the Pinal Date. To avoid termnation you must contact Teton Springs Water and Sewer Company LLC before the Final Date to make a payment arangements or pay in full. Please call on weekdays between a.m. and p.m. and ask for our water collection deparment. Termnation may be delayed by: 1. Providing a medical certificate advising us of the existence of a Medical Emergency. 2. Filng a complaint regarding the proposed termnation with the Idaho Public Utilties Commssion, PO Box 83720, Boise, Idaho 83720-0074, (800) 432-0369. Service wil not be termnated prior to resolution of a fied complaint. Termination of service in no way relieves you of your obligation to pay for all services prior to termination. Should service be termnated, a charge for restoration of service ($ during office hours, $ other times) must be paid, plus the account balance prior to restoration of service. Teton Springs Water and Sewer Company LLC wil, one time, assist you by making payment arrangements not requiring immediate payment in full, if you contact us prior to the Final Date to arrange such a payment plan. Remember, your water wil be turned off after the Pinal Date unless you act before the Pinal Date. EXHIBIT 2 PAGE 2 OF " Teton Springs Water & Sewer, ID 75 W 950 S Ste 3 Victor ID 83455 Service Address- --'. Account Number Due Date I Pay This Amounte-- II06/30/08 Service from Service to I Account No.Service Address 04/01/08 06/30108 I _...- Water Meter Readings Previous Current Usage Description Amount PREVIOUS BALANCE Message Please put account number on check or return bottom portion of this invoice. Thank You. PAY THIS AMOUNT Phone # Fax # E-mail 208-787-8001 ext 28 208-787-8019 sherndon(etetonsprings.com Teton Springs Water & Sewer, ID 75 W 950 S Ste 3 Victor ID 83455 Payment Due Date 0630/08 Account No. II Amount Due . Amount Paid Exll 2 'MZ 3 Of'' TETON SPRINGS WATER AND SEWER COMPANY, LLC., NOTICE OF FILING APPLICATION FOR FILING A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY AND TO ESTABLISH FOR WATER SERVICE Teton Springs Water and Sewer Company, LLC filed an application with the Idaho Public Utilties Commssion ("Commssion") on ,200, Case No. , requesting that the Commssion grant it a Certificate of Public Convenience and Necessity under its authorities and to establish rates and charges for water service. In the event the Commssion grants the Company a Certificate of Public Convenience and Necessity it wil become regulated by the Commssion as a public utilty and be required to comply with its authorities, including its Utility Customer Relations Rules which can be found on the Commssion's website, http://www.puc.state.id.us/Rules.htm. Included with this filing is a summar of the rules and regulations which the Company proposes wil govern its operations as a public utility. The proposed rates are necessary so that the Company can recover its costs and provide it with an opportunity to earn a return on its investments in water facilities which are providing service to customers. This is necessary for the Company to maintain a sound financial position so that it can provide safe and reliable service. The request for a Certificate of Public Convenience and Necessity, and the request to establish rates and charges for water service and are proposals subject to public review and a Commission decision, which it may accept, modify or reject in whole or in part, the proposed increases. A copy of the Application is on fie and available for inspection at the Idaho Public Utilities Commssion, 472 W. Washington Street, Boise, Idaho, and the Company's offices located at: The Application is also available on-line at the Commssion's website: http://www.puc.state.id.usIFILEROOMlwater/water.htm. You can also file a comment on the Application via the Commssion's website at: http://www.puc.state.id.us/comments-complaints/choose%20form.htm. Additionally, you can mail comments to: Idaho Public Utilties Commssion P.O. Box 83720 Boise, Idaho 83720-0074; or Teton Springs Water and Sewer Company LLC 75 West 950 South, Suite 3 Victor, Idaho 83455 In any comments fied with the Commssion and also sent to the Company the Case No. of this matter, Case No. , should be included. Sincerely, Teton Springs Water and Sewer Company LLC bRIM I ! Il 1 or 1