20070920amended_order_no_30367.pdf

Office of the Secretary
Service Date
September 20, 2007
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 AMENDED
ORDER NO. 30367
(Reference Order No. 30436
Final Order on Reconsideration)
CASE NO. UWI-06-
On April 26, 2006, United Water Idaho Inc. (United Water; Company) filed an
Application with the Idaho Public Utilities Commission (Commission) for authority to amend
and revise its Certificate of Public Convenience and Necessity No. 143, as amended. Reference
Idaho Code 9 61-526; IDAPA 31.01.01.112. United Water seeks to add an area known as the
Trailhead Community to its certificated service territory. The area of expansion (approximately
520 acres) is located in Ada County north of the City of Eagle in an area more particularly
described as: A parcel ofland being all of the West 1/2 of the Southwest 1/4 of Section 27 and
all of Section 28, Township 5 North, Range 1 East, Boise Meridian, Ada County, Idaho. The
Commission in this Order approves the Company s Application to amend its certificated area of
service and authorizes the Company to provide water service to the Trailhead Community.
Procedural Background
On May 8, 2006, the Commission issued a Notice of Application in Case No. UWI-
06-04 and established a deadline for comments. On May 10, 2006, the City of Eagle (City)
filed letter comments apprising the Commission of the City s intent to serve the Trailhead
Community and objecting to United Water s Certificate Application. In a May 31 , 2006 letter
filing the City requested a hearing. Pursuant to agreement of the parties, what followed was an
informal stay of proceedings.
On February 21 , 2007, Kastera Development LLC (Kastera), the developer of
Trailhead Community, filed letters with the Commission indicating that negotiations between the
City of Eagle and Kastera regarding annexation were unsuccessful. Kastera renewed its request
for water service from United Water.
. "
. . . in the spirit of comity, we amend our Order No. 30367 deleting language that we find unessential and the City
fmds troublesome. Idaho Code ~ 61-624; IDAPA 31.01.01.326.02. Our deletion of such language, we fmd, does
not compromise the integrity of the Order." Order No. 30436, p. 4.
AMENDED ORDER NO. 30367
On March 6, 2007, United Water filed a Motion requesting that the Commission
convene a preheaTing conference to discuss the scheduling of further proceedings.
Hearing and Commission Findings
On May 30, 2007, a public hearing in Case No. UWI-06-04 was held in Boise
Idaho. The following parties appeared by and through their respective counsel of record:
United Water Idaho Inc. Dean J. Miller
City of Eagle
Kastera Development LLC
Commission Staff
Bruce M. Smith
Tom C. Morris
Scott D. Woodbury
The Commission has reviewed the filings of record in Case No. UWI-06-
including the filed comments of parties and transcript of proceedings. We base our decision on
the established record, Title 61 of the Idaho Code, the Constitution, statutory and local
government authority cited by the parties, and the Commission s related Rules of Procedure.
In considering the Application of United Water for an expansion of its authorized
service area to serve 520 acres of Kastera Trailhead Community Development, the
Commission has reviewed the statutory requirements of Idaho Code 9 61-526 (Certificate of
Convenience and Necessity), Idaho Code 9 61-528 (Certificate of Convenience and Necessity-
Conditions) and the Commission s related Rules of Procedure, Rule 112 (Application for
Certificates of Convenience and Necessity - Form and Contents - Existing Utility).
The positions of the parties and Commission findings in this case can be summarized
as follows:
The Commission is presented in this case with two water providers that desire to
serve Trailhead: United Water and the City of Eagle. Of the two, only one is regulated by this
Commission, i., United Water. The City of Eagle is a municipal water provider and is not
subject to the Commission s jurisdiction. Idaho Code 9 61-104. This Commission does not
doubt the City's intent and desire to provide municipal water service to Trailhead. Tr. p. 189.
Of the two, however, we find that United Water is the only utility that has demonstrated the
present ability to serve Trailhead. We cannot conclude that the City of Eagle is "ready, willing
and able" to provide water service to Trailhead. The proposed area of service, 520 acres north of
Homer Road, is not within the City's corporate boundaries and also lies outside its designated
AMENDED ORDER NO. 30367
area of impact. Kastera explored the possibility of annexation and rezone with the City and in
February 2007 notified the City that it was withdrawing its application for annexation and
rezone. Tr. pp. 20, 153.
What the record in this case reveals is that both the City s Mayor and the Company
general manager agree that it is in the public interest for area water providers to cooperate in
water planning and area of service decisions. Tr. pp. 52, 200. Yet it appears from the testimony
of those with responsibility for planning for each water provider that such cooperation does not
take place, not even discussions. Tr. pp. 202 , 244. Is the public interest being equally well
served by not engaging in planning discussions? We suspect not.
This Commission finds that United Water has adequately planned for and has a fully
integrated water system with sufficient and multiple sources of supply and is capable of
providing safe and reliable water service to the 520 acres of Trailhead Community property
located north of Homer Road and outside the City of Eagle s area of impact boundary. Tr. pp.
, 61 , 62, 82, 84, 126. Under the Company s existing line extension rules, we find that the
cost of additional facilities required to serve Trailhead will be contributed by the developer
without refund. Tr. pp. 22, 23. Any booster stations and storage reservoirs that may be required
will be constructed pursuant to a Special Facilities Agreement and a developer advance with
related refund eligibility. Tr. pp. 84-86. We find that service to Trailhead by United Water will
be in the public interest and that the same can be provided without adversely affecting the
Company s other water customers.
Motion for Continuance - City of Eagle
The City of Eagle at hearing raised two procedural matters for Commission
consideration, both of which the Commission took under advisement. Rules of Procedure 56
252, 253, and 256. At the start of the hearing the City questioned whether a hearing to consider
United Water s Certificate Application might be premature given that Kastera had yet to make
application to Ada County and that so little was known about its proposed development. Tr. pp.
, 11. At the conclusion of Kastera s testimony and revelation that a draft application to the
County by Kastera was largely complete (Tr. p. 154), the City requested that the Commission
continue proceedings at the conclusion of the hearing to allow the City time to look at Kastera
County application and to determine if the City needed to ask further questions of Kastera.
AMENDED ORDER NO. 30367
Both procedural matters relate to the details and information provided (or not
provided) by Kastera regarding its development plans and the respective planning approaches of
the City and United Water. As summarized by the City's engineer, the Trailhead development
has no plan, no design, no approvals, not even an application.Tr. p. 238. Clearly the City
believes more information is required. "At least a concept level plan" is needed, it states, "
that we can actually talk about the parameters of service." Tr. p. 245.
United Water stands prepared to commit to service on the basis of much less
information. Indeed, the Company s engineer contends "it is not unusual for a developer to
confirm that there is a secure source of water supply before undertaking the expense and effort of
developing a design and seeking other government approvals." Tr. p. 90. The City engineering
firm, Holladay Engineering, based on its experience and representation of 13 cities in southwest
Idaho, finds just the opposite to be true. Tr. pp. 244, 245.
United Water submitted its Certificate Application based on a developer-provided
estimate of 500 to 700 homes depending on zoning and conditions of approval. Tr. pp. 20, 164
165. Kastera, we note, has filed no detailed development plan with either the City, County or
United Water. Tr. pp. 43 , 46. The City calculated that current zoning rules limited Trailhead
development to a maximum of 108 units. Tr. p. 212. Under the conceptual plan announced at
the hearing, the County application of Kastera will seek approval of 104 homes under the
County's non-farm cluster zoning. Tr. p. 161.
We find that Kastera s date-of-hearing revelation was not of such a nature as to merit
a continuation of proceedings. The types of questions enumerated by the City that it might seek
to ask (Tr. pp. 179, 180) as indicated at the hearing, are not of the general kind the Commission
would consider when deciding whether or not to grant a Certificate expansion (e., what types
of lines might be necessary; where those lines might be constructed; how the service rendered
would be provided, etc.) but instead as we stated would be part of a later investment prudence
decision. Tr. p. 180.
CONCLUSIONS OF LAW
The Commission has jurisdiction over United Water Idaho Inc., a water utility, and
the issues raised in Case No. UWI-06-04 pursuant to the authority granted under Title 61 of
the Idaho Code and the Commission s Rules of Procedure, IDAPA 31.01.01.000 et seq.
AMENDED ORDER NO. 30367
ORDER
In consideration of the foregoing and as more particularly described above, IT IS
HEREBY ORDERED that the Motion of the City of Eagle to continue proceedings in this case is
denied.
IT IS FURTHER ORDERED and the Commission does hereby approve United
Water s Application to amend its certificated area of service and authorizes the Company to
provide water service to the Trailhead Community. The Company is directed to file an amended
Certificate No. 143 conforming with the Commission s Order.
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 for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code 9 61-626.
AMENDED ORDER NO. 30367
DONE by Order ofthe Idaho Public Utilities Commission at Boise, Idaho this ;J.O
day of September 2007.
PAUL KJELL
JM-
MARSHA H. SMITH, COMMISSIONER
ATTEST:
Je D. Jewell
Commission Secretary
bls/O:UWI-O6-04 sw Amended
AMENDED ORDER NO. 30367