20040220August Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
SCOTT WOODBURY
WORKING FILE
FROM:CAROL COOPER
DATE:AUGUST 22, 2003
RE:UNITED WATER'S DENIAL OF SERVICE TO CUSTOMER OF TERRE
GRANDE WATER
Tira Jones, owner of Mother s Choice Day Care (Mother s Choice), contacted the
Commission because she wants to be served by United Water Idaho (UWI). Mother s Choice is
currently a customer of Terre Grande Water (Terre Grande), an umegulated water company with
approximately 120 customers located south of Overland Road near the Edwards Theaters in
Boise. See attached map. UWI is refusing to serve Mother s Choice until it receives a letter of
release from Terre Grande Water. According to Mother s Choice, Terre Grande has refused to
provide such a letter because it is in the process of negotiating the sale of its water system to
UWI and does not want to lose any customers.
Staff confirmed that United Water s Certificate of Public Convenience and Necessity
includes the subdivision currently served by Terre Grande. UWI has main lines on three sides of
this subdivision. UWI, however, contends it has an obligation to treat Terre Grande in the same
manner it would another regulated water company and is refusing to serve Mother s Choice
without the permission of Terre Grande. However, UWI did extend its facilities to the property.
BACKGROUND
In 1997, Ms. Jones, owner of Mother s Choice, contacted UWI to ask for a service
connection to her business location. UWI thought that the business was served by a private well
that was contaminated. UWI extended service across Overland Road to where it thought
Mother s Choice property line was located. The line extension cost the Company approximately
DECISION MEMORANDUM - 1 -AUGUST 22, 2003
000. However, no service connection was made because Mother s Choice did not do the
necessary work on the customer s property. Mother s Choice did not pursue connection at that
time due to the owner s family illness.
In June 2003 , Ms. Jones called the Commission because she believed the meter box UWI
installed in 1997 was on the wrong side of the irrigation ditch and UWI would not move the line
so she could connect to UWI's system. She was worried about the safety of the children at the
day care due to poor water quality and long outages on Terre Grande s system.
When Staff contacted UWI regarding placement of the meter box, UWI indicated there
was an easement issue with the canal company, and Ms. Jones was advised of the steps necessary
to resolve that issue. At the time, Staffwas under the impression that UWI intended to provide
service to Mother s Choice and that Mother s Choice would be responsible for resolving
whatever contractual obligations it might have with Terre Grande as a separate matter.
On July 11 , 2003, United Water moved the service line and meter box to the other side of
the irrigation ditch to Mother s Choice s property line. The cost to UWI was approximately
500. On July 15, Ms. Jones contacted the Commission again because she had received a call
from United Water asking for payment of $2 500 to move the meter box. Ms. Jones refused
since in 1997 she was advised that it would not cost her anything to install service. UWI did not
actually connect the service, nor has it billed Mother s Choice for line extension costs. UWI
indicated to Staff that it does not intend to pursue collection of the $2 500 charge.
STAFF ANALYSIS AND RECOMMENDATION
In June 1959, Terre Grande Mutual Water Company filed an Application with the
Commission for a Certificate of Public Convenience and Necessity. A year later, the Application
was withdrawn and Case No. U-1081-1 was dismissed. The file contains no information about
why the Application was withdrawn. Staff has not yet conducted an investigation of Terre
Grande to determine whether it is a public utility subject to regulation by this Commission.
According to UWI, negotiations to purchase Terre Grande have been in process for
approximately three (3) years. UWI has refused to provide service to Mother s Choice and at
least one other customer of Terre Grande. The other customer has also filed an informal
complaint with the Commission Staff regarding UWI's refusal to serve. Both customers indicate
that they have experienced water quality, water pressure, and service reliability problems.
DECISION MEMORANDUM - 2-AUGUST 22, 2003
Although the Electric Supplier Stabilization Act prohibits "pirating" of customers of one
electric company by another electric company, there is no similar provision in the law for water
companies. However, Staff recognizes that it is not good public policy to encourage the
duplication of facilities to serve a customer. Unfortunately, in this instance, UWI has already
extended facilities to serve a location (Mother s Choice) already served by Terre Grande.
As the first step towards resolving the issue of which company has the obligation to
serve, Staff recommends that the Commission open an investigation into whether Terre Grande
should be a regulated public utility. Such an investigation may also examine the issue of serving
the daycare center.
COMMISSION DECISION
Should the Commission open an investigation into whether Terre Grande should be a
regulated public utility?
(Y JJJ1~
Carol Cooper
i:udmemos/uwi terre grande dm
DECISION MEMORANDUM - 3 -AUGUST 22, 2003
MAP
CANNOT SCAN