20051213final_order_no_29929.pdf

Office of the Secretary
Service Date
December 13, 2005
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE PETITION OF
HILL VIEW DEVELOPMENT
CORPORATION TO OBTAIN WATER
SERVICE TO COVENANT HILL
SUBDIVISION, AN AREA WITHIN THE
CERTIFICATE BOUNDARIES OF BOTH
EAGLE WATER COMPANY AND UNITED
WATER IDAHO INc.
PETITION
CASE NO. EAG- W -05-
UWI-05-
ORDER NO. 29929
On October 7, 2005, Hillview Development Corporation (Hill view) filed a Petition
with the Idaho Public Utilities Commission (Commission) requesting water service to Covenant
Hill subdivision, an area located at 1501 and 1601 West Floating Feather Road in Eagle, Idaho.
The site is 48.54 acres and has recently been approved by the Eagle City Council for
development of 41 single-family lots. The requested water provider is United Water Idaho, Inc.
Hillview requests expeditious treatment of its request for service.
A portion of the proposed Covenant Hill subdivision is within the certificated service
area of Eagle Water Company, and a portion is within the certificated service area of United
Water Idaho Inc. Reference Eagle Water Certificate No. 278; United Water Certificate No. 143.
Hillview is constructing a pressurized irrigation system for the subdivision and requires only
potable water from a water company. Because the site is relatively small and will comprise only
41 lots, it is Hillview s desire to have only one water company provide service to the site.
As represented in the filed Petition, Eagle Water Company informed Hillview that
there was a water line that could service the Covenant Hill subdivision at the northeast comer of
the site but until Eagle Water obtained several easements from property owners to the south for
an additional water line extension, Eagle Water could not guarantee adequate service. A copy of
a follow up letter to Eagle Water dated August 17, 2005 was submitted along with the Petition.
It is Hillview s belief based on contact with Eagle Water representatives that there has been no
effort put forth to acquire the necessary easements or assurance that Eagle Water can meet the
required fire flows for the subdivision (i., a minimum of 2 000 gallons per minute measured at
20 psi for a duration of2 hours for homes up to 6 200 square feet).
ORDER NO. 29929
Following discussions with Commission Staff and discovery that Covenant Hill
straddled the certificate service area boundaries of both Eagle Water and United Water, Hillview
inquired of United Water whether it was able to provide water service and the fire flows
required. Hillview also contacted the State of Idaho Division of Environmental Quality to
determine whether there was any moratorium for new service from Eagle Water Company.
As represented in the Petition, United Water has informed Hillview that United
Water has a well to the northeast of the Covenant Hill subdivision site and an existing water
main along the subdivision s entire north boundary. Based on a design the developer
construction manager provided to United Water, United Water by letter dated October 5, 2005,
estimates the total construction cost for the installation of the pipes, fittings, fire hydrants and
services necessary to serve the new subdivision to be $164 807. This figure is comprised of the
contractor s cost of $146 870 for materials and installation, plus United Water s inspection and
overheads. Once United Water has approved design drawings, construction of the water
facilities could start within a couple of weeks.
Also included with the Petition is a copy of a September 7, 2005 letter from the
Department of Environmental Quality to Robert DeShazo of Eagle Water Company apprising
Mr. DeShazo that unless additional information is provided by Eagle Water, DEQ will not be
able to approve additional connections to the Eagle Water water system until an additional
supply source or sources are provided that are large enough to meet minimum state peak hour
demand requirements or maximum daily pumping demand plus equalization storage. Reference
IDAPA 58.01.08.550.03.
PROPOSED ORDER AND COMMENTS
On October 19, 2005, the Commission issued a Notice of Petition and Proposed
Order in Case Nos. EAG-05-3 and UWI-05-3. The Proposed Order contained the
following findings:
Based on the foregoing and the need for expeditious treatment of the request
for service, the Commission finds that the public convenience and necessity
requires us to approve the Petition of Hillview Development Corporation and
authorize water service to Covenant Hill subdivision by United Water Idaho
Inc. In so doing, we find Hillview s request for a single water provider to the
subdivision to be reasonable. We also find United Water to be capable of
providing adequate service in a timely manner and to have demonstrated a
willingness to provide service.
ORDER NO. 29929
Comments on the Commission s Proposed Order were filed by Eagle Water, United Water
Commission Staff, Idaho Department of Environmental Quality and the developer.
Eagle Water contends that it is ready, willing and able to serve Covenant Hill
subdivision and is currently able to deliver sufficient water supply and pressure to meet fire flow
requirements. As the majority of the proposed subdivision is within Eagle Water s certificated
area, Eagle Water contends that it should be designated as the sole provider. Eagle Water states
that provision of service to Covenant Hill is critical to Eagle Water s overall system plan. Tying
Eagle Water Well No.6 into its 12-inch mainline on Floating Feather Road, the Company
contends, will not only increase fire flow protection to the Covenant Hill subdivision, it will also
augment the water supply from Well Nos. I and 2 , which will, in turn, serve to augment the
water supply from Well No.4 that can be dedicated to service of the eastern portion of Eagle
Water s service area. This in turn, it states, will help to alleviate low-pressure problems in the
upper elevations of the Eagle Springs subdivision.
Eagle Water has obtained conditional DEQ authority to provide service to Covenant
Hill on the following terms as set forth in Eagle Water November 18 letter to DEQ and DEQ
November 21 letter to Eagle Water:
1. That Eagle Water continue working with the two land owners (Greg
Holmes and Jim Choat) south of Covenant Hill and the Hereford
Subdivision Homeowners Association to obtain a permanent easement to
connect Eagle Water s existing 12-inch water main stub on the Holmes
property to the new Covenant Hill mainline on or before February 16
2006.
2. That MTC Engineering, Inc. provide DEQ working drawings, plans and
specifications for the extension of the 12-inch mainline to Covenant Hill
by January 10, 2006.
3. That Eagle Water construct and connect the 12-inch mainline from its
Well No.6 to Covenant Hill on or before April 1 , 2006.
4. That, if the above conditions are not met and Eagle Water cannot provide
adequate fire flow to Covenant Hill, Eagle Water will relinquish its right
to serve the subdivision.
DEQ's acceptance of a Will Serve Letter for Covenant Hill is further conditioned on the
following:
The foregoing schedule (Eagle Water November 18 letter to DEQ) must
also be acceptable to the Idaho Public Utilities Commission.
ORDER NO. 29929
DEQ must conduct its standard reVIew and approval of the subject
project.
DEQ cannot accept additional Will Serve Letters until the issues
mentioned in the September 7, 2005 DEQ letter to Eagle Water are
resolved, i.minimum hour demand requirement standard (IDAP A
58.0 1.08.550.03.
p).
United Water in its comments confirms that United Water has the capability and
willingness to provide potable water service to Covenant Hill. Following issuance of a final
Order and receipt of an appropriate water system drawing, United Water contends that it is
capable of promptly processing the developer s request for construction of the required facilities.
Commission Staff concurs with the Commission s Proposed Order and recommends
that United Water be authorized to provide water service to Covenant Hill.
Hillview, by way of rebuttal to Eagle Water s comments, contends if "Eagle Water is
ready, willing and able to provide service to Covenant Hill subdivision " then the easement
would already be recorded and the design for the off-site water line would be complete.
Hillview also argues that Eagle Water would not be subject to additional DEQ conditions of
service if it were ready to serve. Hillview states that it cannot wait until sometime in 2006 for
Eagle Water to perform tasks that should already have been completed. Hillview contends that
Eagle Water has been aware of Covenant Hill since February 2005 when Hillview submitted the
preliminary plat to the City of Eagle. Even after repeated requests to Eagle Water for
verification that the utility was willing and capable of providing service, Hillview contends that
Eagle Water did nothing until the Commission issued its Proposed Order.
It is Hillview s position that United Water is the only water company that can truly
be adjudged to be "ready, willing and able to provide service to Covenant Hill." The specter of
Eagle Water failing to satisfy conditions required by DEQ, Hillview contends, will be nothing
short of disastrous for Hillview Development, the homebuilders and the homeowners of
Covenant Hill.
COMMISSION FINDINGS
The Commission has reviewed the filings of record in Case Nos. EAG-05-3 and
UWI-05-3 including the Petition of Hillview Development Corporation, our Proposed Order
directing United Water to provide service to Covenant Hill and related comments. We have also
ORDER NO. 29929
reviewed the certificated area boundaries of Eagle Water and United Water. We continue to find
that the present and future public convenience and necessity is best served by the selection of
United Water as service provider to the Covenant Hill subdivision. Reference Idaho Code ~ 61-
526; IDAPA 31.01.01.112.
We cannot conclude that Eagle Water is "ready, willing and able" to provide water
service to the Covenant Hill subdivision. We find that Eagle Water is still today unable to
satisfy DEQ's minimum peak hour demand system requirement that sets forth a capability
requirement that Eagle Water be able to meet peak day requirements should the Company suffer
the loss of a major supply well. Reference IDAP A 58.01.08.550.03., i.e.
, "
With any source out
of service, the remaining source or sources shall be capable of providing either the peak hour
demand of the system or maximum daily pumping demand plus equalization storage." We are
therefore unable to find that the requested service can be provided by Eagle Water without
adversely affecting the water supply of or otherwise causing an undue hardship on the
Company s existing customers.
DEQ has offered to allow Hillview to proceed while Eagle Water on a parallel path
attempts to secure easements and construct the system looping required to obtain additional
water from Well No., a well estimated to be now producing at only 15% of the rated capacity
of the pumps (2 000 gpm) due to distribution system limitations (bottlenecks and an incomplete
loop). DEQ's offer is conditioned on Eagle Water s commitment to relinquish the Covenant Hill
subdivision area to United Water should Eagle Water be unable to obtain required easements by
April 1 , 2006 or demonstrate an ability to meet minimum state requirements. Reference
November 18 2005 Eagle Water letter to DEQ; November 21 2005 DEQ letter to Eagle Water.
This contingency we find is unacceptable and is not equivalent to being presently "ready, willing
and able" to serve. It does not provide the developer with the certainty of a specific provider and
subjects the developer to the conflicting service requirements and engineering design and
specifications of United Water and Eagle Water.
We find Eagle Water s contention that "the potential harm to Eagle Water and its
customers of not being able to serve Covenant Hill is profound" to be speculative and without
sufficient basis. Reference Eagle Water November 25, 2005 Summary of Comments. The
developer should not be held hostage to the Company s current difficulties and failure to timely
act. We find Eagle Water s delay in remedying identified system deficiencies and its failure to
timely address Hillview s request for service or provide Hillview to date with an estimate of
ORDER NO. 29929
required contribution in aid of construction to be unacceptable. Reference Idaho Code ~ 61-302
(Maintenance of Adequate Service); Eagle Water General Rules and Regulations.
We find that the Commission has jurisdiction as a condition of the Certificate of
Convenience and Necessity to review the extension of service into an unserved area within an
already certified area. Reference Cambridge Tel. Co. v. Pine Tel. Sys.109 Idaho 875 , 712 P.2d
576 (1985). This oversight by the Commission is even more critical when a utility has
demonstrated a failure to follow through on commitments for improvements identified by the
Company as solutions for maintaining and stabilizing pressures in the system. Reference Case
No. EAG-OO-l (Order No. 28513); EAG-03-1 (Order No. 29344); EAG-05-
CONCLUSIONS OF LAW
The Commission has jurisdiction over Eagle Water Company and United Water
Idaho Inc., public water utilities, and the service issues raised in this case pursuant to Idaho
Code, Title 61 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 IS
HEREBY ORDERED and United Water Idaho Inc. is hereby authorized and directed to provide
potable water service to Covenant Hill subdivision.
IT IS FURTHER ORDERED that United Water Idaho Inc. and Eagle Water
Company file amended Certificates of Public Convenience and Necessity and area of service
maps reflecting service to Covenant Hill subdivision by United Water Idaho Inc. and removal of
said area of service where overlap exists from the Certificate of Eagle Water Company. IDAP
31.01.01.112; Idaho Code ~ 61-526.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7)
days after any person has petitioned (or reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code ~ 61-626.
ORDER NO. 29929
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this /3 f-A
day of December 2005.
ATTEST:
111 D. J ~li
C6tnmission Secretary
O:EAG-05-03 UWI-05-03 sw2
ORDER NO. 29929
PAUL
MARSHA H. SMITH, COMMISSIONER