20070518Rhead rebuttal.pdf

Dean J. Miller (ISB No. 1968)
McDEVITT & MILLER LLP
420 West Bannock Street
O. Box 2564-83701
Boise, Idaho 83702
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Attorneys for United Water Idaho Inc.
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-O6-
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
REBUTTAL TESTIMONY OF SCOTT RHEAD
May 18, 2007
Please state your name.
Scott Rhead.
Are you the same Scott Rhead who previously filed Direct Testimony in this
proceeding?
Yes , I am.
What is the purpose of your Rebuttal Testimony?
I will respond to certain statements contained in the Amended Direct Testimony
of Vem Brewer and Nicole Baird Spencer filed on behalf of the City of Eagle.
Do you have a general observation regarding Mr. Brewer s testimony?
Yes. In my Direct Testimony, I provided a detailed explanation of United
Water s ability to serve the Trailhead development. In his Testimony, Mr.
Brewer does not dispute any part of my Direct Testimony regarding United
Water s ability to serve the development. Because my testimony is not
challenged, I take it that the City does not dispute United Water s ability to serve.
At pages 2-3 of his Direct Testimony Mr. Brewer notes that a relatively small
portion of property owned or controlled by the Trailhead developer is inside the
City s area of impact. Do you believe this is relevant?
No. United Water understands that the developer does not at this time intend to
develop that area. United Water s Application in this case seeks an expansion of
its service area only for areas outside the City s area of impact.
At page 3 of his Direct Testimony, Mr. Brewer discusses the City s plans to serve
the Trailhead area. In this regard, have you reviewed the City s Water Master
Plan?
Rhead, Re
United Water Idaho Inc.
Yes I have. According to the plan the northern boundary of its water planning
area is Y2 mile south of Homer Road. The Trailhead development lies to the north
of Homer Road and is outside the geographic area that the City has included in its
planning area.
Also on Page 3 of Mr. Brewer s Direct Testimony he claims that Eagle
Brookwood well "will be on line in 45-60 days." Do you believe the Brookwood
well will be available to provide service within that timeframe?
No. Based on the fact that the only work completed to date is the actual well, and
based on my experience with overseeing the drilling and equipping of various
United Water wells, I don t believe pumping equipment, electrical, and building
construction can be completed that quickly.
Both Mr. Brewer and Ms. Spencer make the point that the Trailhead developers
have not yet made application to the County for subdivision approval and the
developers have not yet completed design of the development. Is this unusual?
No. There are numerous steps in the subdivision development process. In United
Water s experience, developers determine the sequence of those steps depending
on the circumstances of the development. It is not unusual for a developer to
confirm there is a secure source of water supply before undertaking the expense
and effort of developing a design and seeking other governmental approvals.
At page 4 of his testimony Mr. Brewer points out that the annual average water
bill for Eagle customers is somewhat less than the annual average bill for United
Water customers. Please comment.
Rhead, Re
United Water Idaho Inc.
It is true that currently the City s tariff rate for water service is somewhat less
than United Water s. The City s current rates , however, may not include recovery
of the costs associated with the City s ambitious plan to build a municipal water
system. These costs are unknown but potentially huge. Whether those costs are
eventually recovered through consumption rates, connection fees, surcharges, or
some other mechanism, they will create upward pressure on the City s overall
cost of service.
At page 4 of Mr. Brewer s testimony he claims that the City of Eagle encourages
conservation of water by requiring the use of surface water for irrigation. Please
comment.
Requiring the use of surface water for irrigation can not be equated to
encouraging conservation for several reasons. First of all the use of surface water
for irrigation, where available, is required both by Idaho state law and Ada
County ordinance. Thus, Eagle can make no "conservation" claim for requiring
what the law already requires. Secondly, in many cases, using un-metered, less
expensive irrigation water may lead to greater use, not less use of the overall
water resource. It is true irrigation is a different type of water (i.e. not treated to
potable water standards) but this in itself is not conservation. Finally, the City of
Eagle historically has not provided its existing water customers with any
conservation education or information, water saver kits, or other conservation
programs typically offered by water providers. In contrast, United Water has had
an active and varied conservation program in place for many years. In addition
Rhead, Re
United Water Idaho Inc.
United Water has recently completed and the Commission has recently approved
in part a detailed revised Water Conservation Plan.
Also on page 5 of Mr. Brewer s testimony, he claims that the City of Eagle can
serve Trailhead "immediately." Please comment.
This cannot be accurate because, as I stated earlier in my testimony, The
Brookwood well currently lacks pumping equipment, electrical, and building
construction, and these components take considerable time to procure and
construct.
In addition, on page 5 of Mr. Brewer s testimony, he contends it is premature for
United Water to amend its certificate until the developer makes some basic
decisions about what it is going to propose. Do you agree?
No. United Water currently has various portions of certificated area for which no
development plans or decisions have been made by the landholders. These
include infill areas and areas south and east of the City of Boise. The Trailhead
developer has requested to have Trailhead included in United Water s certificated
service area and, as I testified above, it is not unusual for a developer to confirm
there is a secure source of water supply before undertaking the expense and effort
of developing a design and seeking other governmental approvals.
At page 5 of her Direct Testimony Ms. Spencer comments on the per-lot cost of
United Water s estimated facilities construction costs. Do you think this is
relevant?
Not really. Under United Water s Rules and Regulations these costs are
contributed by the developer without possibility of refund from United Water or
Rhead, Re
United Water Idaho Inc.
advanced under a Special Facilities Agreement with refunds supported by
customer revenues thus insulating current customers from speculative developer
risk. Ultimately, the developer must determine how water facility construction
costs affect the economics of a development, but that decision does not affect
other United Water customers. Additionally, Both United Water and Eagle have
main lines in Floating Feather road. Eagle also has water mains at approximately
Beacon Light and Highway 55 but this is approximately the same distance away
from Trailhead as are United Water facilities. So it is likely that the cost for
mains , booster station, and water storage will be in the same cost range for both
Eagle and United Water.
Does that conclude your rebuttal testimony?
Yes it does.
Rhead, Re
United Water Idaho Inc.
CERTIFICATE OF SERVICE
I hereby certify that on the ~day of May, 2007, I caused to be served, via the
methode s) indicated below, true and correct copies of the foregoing document, upon:
Jean Jewell, Secretary Hand Delivered
Idaho Public Utilities Commission S. Mail
472 West Washington Street Fax
O. Box 83720 Fed. Express
Boise, ID 83720-0074 Email
ewell &!uc.state.id.
Bruce M. Smith Hand Delivered
MOORE SMITH BUXTON & TURCKE S. Mail
950 W. Bannock, Suite 520 Fax
Boise, ID 83702-5716 Fed. Express
Email
Thomas Morris Hand Delivered
Kastera Homes S. Mail
372 S. Eagle Road, Suite 375 Fax
Eagle, ID 83616 Fed. Express
tom. morris &!kastera.com Email