20060531Comments.pdf

McDevitt & Miller LLP
Lawyers
[phone]
[phone] (Fax)
420 W. Bannock Street
O. Box 2564-83701
Boise, Idaho 83702
Chas. F. McDevitt
Dean 1. (Joe) Miller
May 31 2006
Via Hand Delivery
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 W. Washington St.
Boise, Idaho 83720
Re: Case No. UWI-06-
Dear Ms. Jewell:
Enclosed for filing in the above matter please find the original and seven (7) copies of
Comments of United Water Idaho Inc.
An additional copy of the document and this letter is included for return to me with your
file stamp thereon.
Very Truly Yours
(\DO
1\ im=
~~~
DJM/hh
Attach.
ORIGINAL
Dean J. Miller (ISB No. 1968)
McDEVITT & MILLER LLP
420 West Bannock Street
O. BOX 2564-83701
Boise, Idaho 83702
Tel: [phone]
Fax: [phone]
i oe(ti),mcdevitt - miller .co m
. :'
'i i i ;:
, ~:; " - '. """"
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF UNITED WATER IDAHO INC., TO
AMEND AND REVISE CERTIFICATE OF
CONVENIENCE AND NECESSITY NO 143
CASE NO. UWI-06-
~ COMMENTS OF UNITED WATER
) IDAHO INc.
COMES NOW United Water Idaho Inc.
, ("
United Water , the "Company ), pursuant to
the Commission s Notice of Application dated May 8, 2006, and submits the following
Comments:
The Application
The Application in this matter was filed on April 26, 2006, in response to a written
request for service submitted to the Company by the project developer, Kastera Homes. Exhibit
A attached to these Comments, depicts the location of the proposed service area addition, with
the boundaries of the addition shown in red. Exhibit A also shows the existing City of Eagle
Impact Area, as approved by the Ada County Commission. As is obvious from Exhibit A, the
proposed service area addition is completely outside the City of Eagle Impact Area.
COMMENTS OF UNITED WATER IDAHO INc-
Exhibit B, attached to these Comments depicts facilities required to provide service to
Trailhead-an approximate two-mile extension of 16 inch main line north from the Company
Floating Feather main line. These facilities would be installed pursuant to United Water
standard main line extension Rules.
Also depicted on Exhibit B are the boundaries of the "Olsen Ranch " which is the
property subject to development. As can be seen on Exhibit B, small portions ofthe southern
boundaries of the Olsen Ranch are within the City of Eagle Impact Area. However, Kastera is
not planning to develop these portions of the Olsen Ranch and water service has not been
requested for these areas. (See Kastera s May 24 2006 Letter to United Water, discussed
below).
The Protest
On May 10, 2006, the City of Eagle ("City ) filed a Protest of the Company
Application in the form of a letter addressed to the Commissioners from the attorney for the City
Protest"). The Protest generally alleges that the Trailhead area, or a part thereof, will be served
by the City municipal water system. The Protest attaches an April 18, 2006, letter from Kastera
Homes to the City inquiring whether Kastera could be invited to a work session to discuss the
possibility of annexation.
Discussion
A. Notwithstanding its April 18. 2006. letter to the City. Kastera desires to be served by
United Water.
Following receipt ofthe City s protest, United Water communicated with Kastera, asking
for a clarification of Kastera s desires and intentions. Attached, as Exhibit C, is a May 24 2006
letter from Kastera to United Water s Construction Coordinator, Mr. John Lee. As noted in the
1 It is likely the developer will also be required to provide Special Facilities Advances for a booster station and
storage reservoir although the location and cost of these facilities is yet to be determined.
COMMENTS OF UNITED WATER IDAHO INc-
letter, Kastera desires service from United Water because United Water has the ability to provide
service immediately without extensive system upgrades. The letter notes that discussions of
annexation with the City have been conceptual only, and relate to the other portions ofthe Olsen
Ranch within the City s Impact area. Those areas are not included in this Application. As stated
in the letter:
At this point, it is undetermined if we will ever be annexed into the City of
Eagle. Annexation may happen in the future.. . and it may not. However, one
thing is certain, we need water service immediately and United Water is the only
water service provider that can meet our time schedule. Therefore, we are
requesting water service from United Water to serve our property outside of the
Eagle Area Impact Boundary
While the desires of the persons requesting service are not always completely dispositive
they are entitled to weight and consideration. Here, the developer, sensibly, desires service from
the provider capable of immediate extension of facilities-United Water. While the City
Protest states generally it will provide service to the area, or part of it, the Protest provides no
information regarding the facilities required and when or if they could be physically extended.
B. Because the proposed expansion area is outside its area of impact. the City does not
have grounds for obiection.
The City s Protest asserts
, "
The defined area of expansion includes an area and a
development that will be served by the City of Eagle municipal system." As made clear above
United Water does not propose to provide service within the City s impact area. As a legal
matter, municipalities may only provide domestic water service within their boundaries. (See
Idaho Code 50-323). As stated recently by the Idaho Supreme Court in Big Sky Paramedics
Sagle 140 Idaho 435 (2004):
This Court has articulated this rule as a strict limitation when construing municipal
powers: "municipalities may exercise only those powers granted to them or necessarily
implied from the powers granted it (and i)fthere is a fair, reasonable, substantial doubt as
COMMENTS OF UNITED WATER IDAHO INc-
to the existence of a power, the doubt must be resolved against the city." City of
Grangeville, 116 Idaho at 538, 777 P.2d at 1211.
Notwithstanding this, in United Water s experience, it is not uncommon for
municipalities to extend facilities into areas of impact in advance of, but in anticipation of
eventual annexation. A municipality, clearly however, has no authority to provide service
outside its impact area. The City, therefore, does not have grounds for objection to the proposed
addition.
C. Even if annexed by the City. United Water may be entitled to serve the area.
While United Water is not requesting that the Commission, in this case, engage in
construction of a contract, the Company believes the Commission should be aware of a written
Franchise Agreement between the City and United Water. It is attached as Exhibit D.
Relevant portions of that Agreement are:
In the case of annexation of property to the corporate limit, such area will be considered
under this agreement, upon effective date of the annexation, subject to Section 9 hereof'
(Section 1 , Page 1).
In the event the City annexes a new area into its corporate limits, the terms of Section 9
regarding franchise fees shall not apply to the annexed area until sixty (60) days after the
City has supplied the Grantee with appropriate information for the identification of the
Grantee s customers within the annexed area , (Section 10, Page 3).
In consideration of Grantee s undertaking hereunder and as exists upon the effective
date of ordinance 414, the City agrees not to engage in the business of providing water
service during the life of this franchise or any extension thereof in the Grantee
certificated service area approved by the PUC as of September 10, 2002 and as
subsequently amended by the PUC", (Section 14, Page 4).
A definitive interpretation of the Franchise Agreement would be premature until such
time as the City actually attempted to annex the area, which mayor may not come to pass.
2 The Franchise Agreement was also submitted to the Commission in May of 2003 when the Commission approved
an amendment to United Water s tariff to permit recovery of the I % franchise fee specified in the Agreement.
COMMENTS OF UNITED WATER IDAHO INC-
Nonetheless, the Commission should be aware of the possibility that the City, by contract, has
relinquished the right to provide water service that it might otherwise enjoy.
Conclusion
For the reasons cited herein, United Water respectfully requests that the Application be
granted and the Company be authorized to file an Amended Certificate of Public Convenience
and Necessity to include the area described in the Application.
DATED this day of May, 2006.
Dean J. Miller
Attorney for United Water Idaho Inc.
COMMENTS OF UNITED WATER IDAHO INc-
CERTIFICATE OF SERVICE
I hereby certify that on the day of May, 2006, I caused to be served, via the
methodes) indicated below, true and correct copies of the foregoing document, upon:
Jean Jewell, Secretary Hand Delivered
Idaho Public Utilities Commission S. Mail '-8
472 West Washington Street Fax '-8
O. Box 83720 Fed. Express '-8
Boise, ID 83720-0074 Email '-8
ewell uc.state.id.
Bruce M. Smith Hand Delivered '-8
MOORE SMITH BUXTON & TURCKE S. Mail
225 N. 9th Street, Suite 420 Fax '-8
Boise, ID 83702 Fed. Express '-8
Email '-8
~yi-b.llLI \J.~() ~"'t,
COMMENTS OF UNITED WATER IDAHO INc-
EX
H
I
B
I
T

A
TR
A
I
L
H
E
A
D

C
O
M
M
U
N
I
T
Y
EX
P
A
N
S
I
O
N
UW
I
D
Ce
r
t
i
f
i
c
a
t
e
d

A
r
e
a
Pr
o
p
o
s
e
d
Ce
r
t
i
f
i
c
a
t
e
d

A
r
e
a
Im
p
a
c
t

A
r
e
a
..

Ea
g
l
e
UW
I
D

M
a
i
n
s
4
I
n
c
h

M
a
i
n
6
I
n
c
h

Ma
i
n
8
I
n
c
h

M
a
i
n
~~

12

I
n
c
h

M
a
i
n
16

I
n
c
h

M
a
i
n
,;.
t
,
Un
i
t
e
d

Wa
t
e
r
-"
-
'
-
"
'
e
z
:
Sc
a
l
e
1
i
n
c
h

e
q
u
a
l
s

2
00
0

f
e
e
t
-"
-
"
"
"
"
-
"
_"
"
"
~
_
H
~
"
'
_
.
-.
.
.
.
.
.
.
.
.
.
.
.
.
"
-
.
.
.
.
"
,
,
_.
.
.
.
.
"
.
.
.
.
.
.
.
.
.
.
.
.
-
p-
~
"
'
C
_
'
""
'
o
e
d

c-

04
-
2
6
-
0
8
EX
H
B
I
T

A
EX
H
I
B
I
T

B
TR
A
I
L
H
E
A
D

C
O
M
M
U
N
I
T
Y
EX
P
A
N
S
I
O
N
UW
I
D
Ce
r
t
i
f
i
c
a
t
e
d

A
r
e
e
Pr
o
p
o
s
e
d
Ce
r
t
i
f
i
c
a
t
e
d

A
r
e
a
..

.
.

.
.

I

Ols
e
n

R
a
n
c
h
UW
I
D

M
a
i
n
s
4
I
n
c
h

M
a
i
n
6
I
n
c
h

Ma
i
n
8
I
n
c
h

M
e
l
n
12

I
n
c
h

M
a
i
n
16

I
n
c
h

M
a
i
n
Un
i
t
e
d

Wa
t
e
r
-"
,
-
-
"
"
,
z
.
Sc
a
l
e
1
i
n
c
h

e
q
u
a
l
s

2
00
0

f
e
e
t
""
"
"
"
,
.
.
.
.
.
.
.
.
-
.
.
_w
.
.
.
-
-
.
.
.
-
.
.
.
.
""
"
"
"
-
-
"
-
"
"
"
"
""
'
-
.
-"
'
-
-
-
-
"
'
-
__
"
'
0
"
"
"
"
nn
O
R
A
"
"
,
"
O
"
"
"
"
"
,'
"
"
"
"
"
"
'
,
_
.
.
.
.
..
.
.
.
.
w
.
.
.
.
.
o
"
'
"
_"
,
"
o
a
R
,
"
,
~.
.
.
.
.
.
_
.
.
.
.
.
Ro
w
'
"

D
.
.
.
:

O
'
-
15
.
c
O
EX
H
I
B
I
T

B