20090903Wyatt Direct.pdf

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20nQ SEP -3 PM 3: 54
DeanJ. Miller(ISB 1968) IDAHO PUf/',t;:,':~;,~
McDEVITT & MILER LL~TIl\TiES CO¡Y1¡~'¡¡'J")
420 West Banock Street
P.o. Box 2564-83701
Boise, ID 83702
Tel: [phone]
Fax: [phone]
joe~cdevitt-miller.com
Attorneys for Applicat
BEFORE TH IDAHO PUBLIC UTILITIES COMMSSION
IN TH MATTER OF TH APPLICATION Case No. UWI-W-09-01
OF UNTED WATER IDAHO INC. FOR
AUTHORITY TO INCREASE ITS RATES
AN CHAGES FOR WATER SERVICE IN
TH STATE OF IDAHO.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
DIRCT TESTIMONY OF GREGORYP. WYATT
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Please state your name and business address.
Gregory P. Wyatt. United Water Idaho, 8248 West Victory Road, Boise Idaho.
What is your occupation?
I am the Genera Manager of United Water Idaho ("United Water" or
"Company").
Please describe your educational background and other qualifications.
I am a graduate of Bloomsburg University with a Bachelor of Ars degree in
Business Adminstration Mangement. I have previously provided testimony
before the Indiana Utilty Reguatory Commssion, the Pennsylvana Public
Utilty Commission, and the Idaho Public Utilties Commssion.
Q.Please describe your work experience.
A.I have been employed at United Waterworks properties, formerly General
Waterworks, since December 1974. Prior to assumg my curent duties as
General Manager of United Water Idao in late 1999, I worked in varous
capacities in several states including General Manager for United Water
Pennsylvana, Area Manager for the United Water Indiana operations, Assistant
Manager of United Water Idao and varous accounting positions in New Jersey
and Pennsylvana
Q.Please describe your duties as Genera Manager.
A.My duties are to oversee the daily operation of providing potable water to the
customers of United Water Idao. I supervse the varous deparents of
Engineerig, Production, Tranmission & Distribution, Customer Service,
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Biling, Inormation Technology, Planng and Accounting in meeting their
responsibilties for the delivery of potable water and p~ovidig related services
to customers.
These fuctions include planng for raw water source, constrction,
maintenance and operation of the treatment and pumping facilties, constrction,
maintenace, and operation of the distrbution system including mains, services,
and storage tas, responding to customer needs regardig initial service or
discontinuing service by reading customer meters, processing and deliverig
bils, and responding to other customer needs though the Customer Servce
Representatives.
My duties also include supervsion of the Company's compliance with all
regulations in regard to safety, compliance with the Safe Drinkng Water Act,
and other similar requirements.
Q.What is the purose of your testimony?
A.I will testify regarding the major reasons for the rate increase requested in this
present case, the operations of the Company, and the Company's conservation
and customer service efforts. I also propose that the Commssion approve a
Budget Bil Program and a minor change to the Company's Rules and
Regulations. I will also be available to answer questions of a general natue.
Q.Please identify the other witnesses who will testify on behalf of the Company
and the topics on which they will testify.
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United Water Idaho Inc.
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1 Mr. Charles E. Loy, with GDS Associates, Inc., wil testify regarding revenueA.
2 adjustments and expense adjustments.
3 Mr. Kevin Dohert, Director of Rates with the United Water M&S Company,
4 will testify regardig rate base and revenue requirement.
5 Mr. Scott Rhead, Director of Engineering, will testify regarding pro-forma
6 capita additions, plant in service, and purchased water expense.
7 Rate Increase Drivers
Q. Would you briefly explai why the Company is seeking a rate increase at ths
time?
A. The increase is necessar for the Company to continue to provide quaity
servce to our customers, to improve servce by replacing aging inastrctue
and to replace inastrctue that is in confict with other intrctue renewal
(such as highway and street rebuilds). For these reasons, United continues to
make capita investments in utilty plant. The Company's rate base of
$141,015,147 as filed in our last rate proceeding (Case No. UWI-W-06-02) has
increased to $154,l27,480 in ths proceeding or an increase of$13,112,333. In
addition, operating costs have increased since the last rate proceeding from
$22,877,788 to $24,123,096 or an increase of $1,245,308. An increase in rates
is necessar in order to provide suffcient capita dollars to maintain and
improve quality service to our customers, to provide adequate operating and
maintenance coverage, and to maintain a sound financial position.
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What are the major capita investments the Company has made since the last
rate case that account for the increase in rate base?
The Company has invested about $2 milion dollars in tratment facilties at
varous locations in the system with $1.6 millon of that for the intalation of a
granular activated carbon treatment system for the removal of volatile organc
compounds (VOC's) contaation in two wells at the Swift Well complex.
Ths investment at the Swift site has enabled the Company to improve water
quality to customers while also utilizing more of the source well water from
those wells. The Company has made investments totaing more than $12
milion dollars in replacing aging infrastrctue. Since the last case the
Company has replaced over 16 miles of water mainline, 2,200 water services,
and 13,000 meters. Additionaly, the Company has improved system reliabilty
by investing almost $1.4 milion in booster station improvements, and over $0.7
millon dollars in auxilar power generators at varous sites thoughout the
water system.
Q.What are the major areas of operating cost increase tht the Company has
experienced since the last rate case?
A.A signficant portion of the expense increase in ths case comes from
depreciation related to the capita investments the Company has made. The
depreciation expense has increased by more than $700,000. Additionally, costs
have increased by more than $600,000 related to electrc power and chemicals.
The Company is also seeking reimbursement of over $100,000 related to its new
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conservation progrs and effort since 2006. All of these and other expense
changes are discussed more fuly in Witness Loy's testimony and exhbits.
Wht is the curent average anua residential water bil as determined in the
test year?
The curent average anua residential bil, as reflected in ths case afer
adjustments and normalization, is $342.81, exclusive of Idaho Deparent of
Environmenta Quaity (IDEQ) fees and city franchise taes.
Q.What would be the averae anua residential bil under the proposed rates in
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this filing, and what is the overal increase request?
A.The average anual residential bil under proposed rates would be $395.25, or
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an increase of 15.30%, or about $4.37 per month, or about $.15 per day. The
overall increase request in this present filing is 15.21 %.
13 Cost of Service and Tariff Design
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Q.What is the Company's proposal for adjustments to rates to recover any revenue
increase that may be awarded by the Commission?
A.As explained in more detal in the testimony of Witness Loy, the Company is
proposing a unform percentage increase to all rate elements, excluding
miscellaneous service charges and fees. The Company is not proposing, in ths
case, any change to the curent taff design and is maintanig the 25%
differential between winter and sumer volumetrc rates.
A.Is the Company presenting the testimony of an independent cost of service
witness in this case?
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United Water Idaho Inc.
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1 A.No. On July 2, 2009, the Company fied a Motion for Order Waiving
2 Requiement for Cost of Service Study, and on July 16,2009 the Commission
3 granted the waiver in its Order No. 30865.
4 Company Operations
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Q.Please describe the operations of the company.
A.As of May 31, 2009, United Water Idao provided domestic water servce and
fire protection to approximately 83,900 residential, commercial, private fie
protection and public authority customers within the City of Boise and the
imediate surounding area Curently our source of supply is comprised of
two (2) surace water treatment plants and eighty-five (85) deep wells, which
are located thoughout a service area of approximately 146 squae miles. The
projected nomina delivery capacity in the year 2009 of the surface water
treatment plants and the eighty-five (85) wells to customers is 97.5 milion
gallons per day (mgd).
At ths time, well water treatment essentially consists of the addition of
chlorine for disinfection and system residuals as well as polyphosphate for
sequestrtion of iron and manganese. In addition, green sand filtration systems
treat water at two well stations in the system, (Bali Hai and Maple Hils), and a
granular activated carbon filtration system treats two wells at the Swift well site.
At the Marden Street surface water treatment plant, the treatment ranges from
direct fitrtion to ful coagulation, settling and filtration depending on the
quaity of the raw water. At the Columbia surface water treatment plant,
treatment is accomplished using micro-filtration membraes.
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Durng 2008, the maximum day production (demand) from all sources was
84.9 milion gallons; the minimum day production was 17.4 milion gallons;
while average day production was approximately 41.7 milion gallons. The
historical maximum day demand was 94.1 millon gallons in July 2003.
The distrbution system consists of approxiately 1,178 miles of water
main, varing in size from 2 inches to 30 inches in diameter. The distrbution
system also is supported by 36.3 millon gallons of storage capacity contaned in
37 ground-level reservoirs.
Due to differences in elevation with the coverage of the service area,
United Water Idaho has 10 different major pressure zones. These zones are
necessar to maita a reasonable rage of pressure at the customers' points of
use. Connections from adjacent pressure zones allow us to tranport water
between some pressure zones; however, it is not possible to transport water
from each pressure zone to all 9 of the other pressure zones. Since we have 87
sources (points from which water originates), the customers withn the area of
infuence of a paricular source normally will receive water from that source.
As the customers near the source begin to use up the water and as distance from
the source increases, more water will be consumed until the supply from a
paricular source is exhausted and adjacent customers then receive water from a
different source.
Q.You note that the combined nomial delivery capacity of the system is
approximately 97.5 mgd while the maximum day demand from 2008 was 84.9
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milion gallons. Does ths mean tht you can serve signficant numbers of
additional customers without adding any additional source?
No, it does not. That would require a perfectly balanced distrbution system and
every well would have to produce 100% of capacity at the same time. Ths
perfect balance would have to be between the main sizes, main locations, source
locations, pumping capacity, storage size, and storage locations.
Additionally, when the need for supply redundancy is considered the
apparent surlus is reduced. The Idaho Deparent of Environmenta Quaity
requires water suppliers to provide supply redundancy by allowig for the loss
of the largest capacity wells when determining their reliable water supply
tagets. Two key operational service areas of the water system are Columbia
and the West First Bench. The largest wells serving these zones are Pleasant
Valley (2.5 mgd) and Bethel (2.8 mgd) respectively. With a combined capacity
of 5.3 mgd, these sources, if lost, decrease the difference in overall system
supply compared to demand signficantly.
Customer growt is also not distrbùted evenly across the system. There
are areas poised for higher growt where new sources of supply will be needed.
Most notably the southwest and nortwest areas of the system have historically
experienced growt that, when the economy recovers, will likely require futue
source additions.
Q.The pro-forma operating expense adjustments presented by Witness Loy
indicate that three new employee positions are included in this cae. Please
explain these new positions and the need for them.
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The thee new positions are a GIS Supervisor, an Accountig Manager, and a
Human Resources Generalist.
GIS Supervisor: Ths position is being added in order to enable the Company to
continue its electronic mapping, to upgrade its geographic information system
(GIS) from the curent legacy softare, Arclnfo GIS, to the more curent
technology of ArcGIS geodatabases, and to continue to maita mapping
updates in GIS. Previously, the Company was able to accomplish map updates .
using an outside contractor; however the contrctor is not willing or able to
upgrade to ArcGIS. The GIS Supervsor was hired effective July 27, 2009.
Accounting Manager: This position is being added in order to enable the
Company to more effectively maintain its books and records, and to meet
reconcilation and reporting requirements. In 2007, the then curent Accounting
Manager resigned for personal reasons and the Company replaced that position
with an Accountat; aligng the deparent under the Manger Finace and
Rates. Since that time the accounting, planng and reporting requiements of
the Company have increased, including the effects of the Sarbanes-Oxley Act.
The Manager of Finance and Rates is now devoted ful-tie to plang and
reguatory matters resultig in the need for an Accountig Manager to agai
oversee the deparent. The Accounting Manager was hired effective Augut
31,2009.
Human Resources Generalist: Ths position is being added in order to enable the
Company to accomplish the local HR fuctions. Curently, the Adminstrtive
Assistat!rainng Coordinator performs the thee fuctions of adinistrtive
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assistant for the General Manager, traig coordinator, and local human
resources activities. Ths long-term, seasoned employee has confired that she
will retire in the first quaer of 2010. In order to accomplish the required
fuctions a replacement Admnistrtive Assistat (AA) will be hied to fufill
the AA requirements for the Genera Manger plus the Accounting, Production
and Commercial Deparments, which curently have little or no AA support.
The local human resources and trng coordination fuctions will be filled by
the new Human Resources Generalist. The Human Resources Generaist
position is expected to be filled by year-end 2009.
Q.The Company has $203,994 of expense for R&I Allance in the test yea ending
May 31, 2008. Please explai the Company's R&I Alliance.
A.The R&I Allance is a legal entity strctued as a parnership between the
following companes: Lyonnaise des Eaux, United Water Mangement and
Services, Nortumbrian Water, Aguas de Barcelona in Spain and Suez
Environnent. Ths parership provides the Company with access to a
worldwide techncal network including expert in virtly every field of water
and wastewater operations, from water supply to treatment, distrbution, and
sludge drng.
Q.What is the strctue of ths Company and what par does United Water
Resources play?
A.The Allance has a Board of Directors, in this case composed of the CEO of
each member company. The Board in tur provides direction to a Steering
Committee which is composed of two senior executives from each company,
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including the Technical Director and Operations Director. United Water
Resources' Charman of the Board is the Chairman of ths Alliance.
How is the Alliance fuded?
It is fuded by member contrbutions. United Water Resources contrbutes
approximately $2.2 milion per year of which United Water Idaho's portion is
$203,994.
What is the objective of the Alliance?
The mission of the Alliance is to select, fud and coordiate the execution of
common projects in the above member companies. The focus is on operationa
needs withn these companes in which inovation can be brought to everyday
operations.
Q.Wht are the advantages to United Water Idao?
A.The Alliance was created to obtan better value from research and inovation
projects by means of Leverage - economies of scale and synergies between
companes; Direction - the abilty to steer and infuence the work underten;
Strategic input - a pool of expertise ensurng the needs of the US water
industr were met; and Trasparency - clear selection and fuding processes.
United Water as a whole is able to parcipate in a range of inovative
projects far greater than possible on its own. As par of United Water Resours,
United Water Idaho is able to paricipate in, and direct ths research.
Q.How are the projects managed?
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There is a discrete techncal program with identified phaes of development,
execution and dissemination of results for projects. Overal the topics are
aranged into progr themes, each theme being manged by a member of the
steerig commttee. The themes ar, Asset Management, Energy Effciency,
Control of Odors, Sludge Management, Stormwater Management, Meterig,
Water and Health.
Q.Do you have any examples of these, parcularly with respect to United Water
Idaho?
A.There are numerous projects underway and thereby a large amount of
information available to all United Water companes. Followig are examples
of some projects and their application in the United Water Idao service area.
Fixed Network Automated Meterig
This project is to evaluate the added value inherent with the unque
capabilties of Fixed Network automated meter reading technologies. In
paricular the project focus is on engineering anysis and design, and customer
service/customer relations value added. Ths project is curently ongoing at the
United Water Idaho location with two 100-meter pilot sites in the system
evaluating two different Fixed Network Automated Metering systems.
Water Demand Management Surey
This project is to evaluate residential customer water use behavior both
indoors and outdoors. Its objectives include understading the impact on
residential usage of varous conservation products, obtang data on customer
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water use behavior, end-uses and appliance satution, and faciltating
conservation behavior by providing household specific inormation on curnt
uses and conservation potential. Data is obtaed via a residential customer
water audit surey.
Why is it appropriate for the Company to parcipate in such a program?
A water utilty the size of United Water Resources should engage in ongoing
research and development. There is a signficant amount of research worldwide
and some of ths is aleay being fuded by the Company though its
membership in the American Water Works Association Water Research
Foundation (WR). The tota amount paid by the Company to the WR for
2008 was $33,708. The Company ha not had any signficat research and
development expenses beyond the WR membership fees. Unforttely, tota
research and development in the water industr has been declinig in real term
in recent years in spite of looming issues like increasing energy costs and
growig competition for water resources. The larger companes, like United
Water, have a responsibilty to tae a leadership role, and fuding a reasonable
level of research and development should be par of that role.
Q.Is the Company's contrbution to the R&I Allance duplicative of the work that
is being done by the WR?
A.There may be some overlap, but generally not. WR fuds reseach of general
interest to the water industr, which is importt and necessar, however the
R&I Allance focuses on research and development of specific benefit to the
member utilities including United Water Idaho.
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1 Q.How does research and development in the water industr benefit water utilty
customers?
A.The tye of research done by organzations like WR and R&I Allance
4 produces best practices and new management and operating technques tht
5 serve to improve water quaity, increase operating efficiency and extend asset6 life.
7 Budget Bil Plan
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Q.Please describe the Company's request to implement a Budget Bil Plan for
residential customers in ths case.
A.United Water's proposed Budget Bil Plan is more fuly described in the
atthed proposed amendments to its Rules and Reguations atthed as Exhbit
No.1. In general the program has the followig featues:
~ The program will be available to all residential customers residig in a
premise in which they have twelve (12) consecutive month of water service, (6
actu historical bils). Customers must be in curent account status with no past
due amounts;
~ Enrollment would be permitted at the convenience of the residential
customer with no set enrollment period;
~ No interest will accrue on positive or negative balances;
~ Residential customers may be removed from the Budget Bil progr
for failure to timely pay the agreed budget bil amount;
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1 ~ United Water may perform mid-term adjustments to the amount of the
2 budget bil payment due to rate changes, extreme weather impact or other
3 signficant unoreseen circumstaces (major leak etc) as described on Exhbit
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5 Upon enrollment the customer's payment amount under the Budget Bil
6 plan will be calculated based on their most recent twelve (12) months history (6
7 bi-monthy reads) of consumption at the premises. The customer will receive a
8 budget bil monthy. An anual reconcilation will be performed with negative
9 or positive balances, withn limts, rolled forward into the next Budget Bil
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11 United Water will advertise the availabilty of the Budget Bil plan
12 though news releases, bil messages, bil inserts, publication of inormation on
13 its website, the "on hold" telephone message and though direct customer
14 servce representative contact. Residential customers will be permitted to enroll
15 in person at the Company's offce, by telephone, and bye-maiL.
16 United Water wishes to implement the Budget Bil plan in conjunction
17 with the effective date of a Commission Order for ths present case. The
18 Company expects there will be cert costs associated with implementation,
19 and has estimated those costs to be approximately $56,000, assuming that i 0%
20 of its residential customer base enrolls in the program. The $56,000 represents
21 the anual costs of the program and is composed of additional biling, postage
22 and payment processing expenses associated with the Budget Bil plan. These
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costs and the calculations supportng them are fuer explained in the testimony
of Witness Loy.
Q.Why does United Water believe that providing ths Budget Bil plan to its
residential customers would be in the public interest?
A.The Company believes a Budget Bil plan for its residential customers is in the
public interest for the following reasons:
~ United Water's customer servce representatives routinely and
frequently receive inquies from residential customers askig about the
availability of a budget bil payment program. The Company believes that there
is signficant customer demand for such an option.
~ The single greatest category of calls received from residential
customers by United Water's customer servce representatives is customers
requesting to make payment arangements. The volume of these requests
increases significantly durng the irrgation season with its consequent higher
bils. A Budget Bil plan would address the need expressed by residential
customers of having available the option to, on an anua basis, level out their
payments for water service.
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~ For many residential customers, over 60% of the anual bil is
comprised of the thee bi-monthly bils that cover the sprig and sumer. This
can lead to customer hardship. A Budget Bil plan will allow customers a
signficantly less burdensome method to deal with seasonal fluctution of their
water bil.
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~ United Water's rates for water service have, for approximately fifteen
(15) years, contaed a sumer consumptive rate (from May 1 though
September 30) that is 25% higher than the winter rate. In the Company's
opinion, r~sidential customers understad and react to the price signal inerent
in the seasonal rate design. The Company also believes a Budget Bil plan
would not signficantly dampen such a signal, while providing the residential
customer flexibilty to level out their payments as they are permitted to do with
energy providers.
~ A Budget Bil plan allows residential customers to plan and budget
water usage more effectively than the curent "pay as you go" basis. Intead of
being faced with larger sumer bils tht may be extremely burdensome,
customers will be able to make less stressfu, longer term decisions about water
consumption and how it fits into their personal budget.
Q.Has United Water previously fied a request to adopt a Budget Bil plan and if
so, what was the outcome of tht fiing?
A.In Febru 2004, the Company fied a Modified Procedure Application to
implement a Budget Bil program, (UWI-W-04-01). Commssion Sta
subsequently filed comments in support of the Company's proposal, but with
certin modifications. In its Order No. 29455, dated April 9, 2004, the
Commssion denied the Company's Application citing concern over the cost of
the program and the potential for it to detract from the curent rate design that
encourages sumer conservation.
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1 Q. Since the Commssion's 2004 decision, what has changed that leads the Company
2 to conclude tht a Budget Bil plan should again be considered?
3 A. Two thgs have changed tht I believe the Commission should consider. First,
4 the curent poor economic climate makes it much more diffcult for customers to
5 pay bils, especially when they have signficant seasonal swigs in the amounts
6 due. Because United Water bils customers on a bi-monthy basis, the bils are
7 much more diffcult to budget for and pay than if the customer were to receive a
8 monthy bil of the same amount as proposed under the Budget Bil plan. One
9 way to measure the increased financial burdens our customers are facing is to
10 exame the Company's outstading accounts receivable balance over 90 days
11 and its bad debt expense over prior year. Both have shown a signficant increase
12 over prior year. The first grph below marked "Accounts Receivable Over 90
13 Days" shows a marked increase in the level of amounts due for the year 2008-
14 2009 compared to the years 2006-2007. On average the increase is alost 68%.
15 Similarly, bad debt expense, ilustrated in the second graph below, shows an
16 increase of 47% from the average of 2006-2008 to the estimated 2009 amount in
17 this present case.
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$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
1
2
Accounts Receivable Over 90 Days
$0
-2009
-2008
-2007
-2006
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
.$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
3
4
Annual Net Bad Debt Expense
2006 2007 2008 2009 Est.
5 The second change to consider is that anua production volumes per
6 customer have declined considerably, even in the winter month when no
7 irgation load occurs, which suggests that customers are now more conscious.8 tha ever about their water use and are applying the conservation measures
Wyatt,Di 19
United Water Idaho Inc.
.1 promoted by the Company's conservation progrs and messages. Ths leads
2 me to believe that the financial burden on customers could be relieved though a
3 Budget Bil plan without diluting the conservation signal inherent in the curent
4 25% seaonal rate differential.
5 The graph below highlights the significant decline in per customer usage
6 in the sumer. It depicts the maximum day production per metered customer
7 since 2000. In all years the maximum day occured in July, except 2001 when it
8 occured in August.
Max Day Gallons per Metered customer
1,350
1,250.I/1,150z
9..
ceC)1,050
1,048 1,037
950
850
2000 2001 2002 2003 2004 2005 2006 2007 2008 200
9
10
11 Customer usage in the winter is declinng as welL. The grph below shows
12 average daly water produced per metered customer from 2000 to 2009. The
13 data is for the winter months of November though Februar when no irgation
14 load is present..
VVyatt, Oi 20
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Average Daily Production per Customer - Winter
365
340
345
::co 325C..
CU 305D.IIC 285..-
co 265~
245
225
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1
2 Q.Does the Company believe tht a Budget Bil plan for residential customers will
3 materially diminsh the water pricing sign of sumer rates or the effect of the
4 Company's conservation efforts?
5 No. The data cited above confrms that customers have been and are continuingA.
6 to respond to both economic pressures and the Company's conservation efforts
7 in reducing their water consumption. When customers incorporate watèr saving
8 approaches into their lives, whether by mean of changed water use habits or
9 though water saving devices, they are not likely to abandon them simply
10 because the economy improves or they are aforded a different approach to
11 paying for their water service though a Budget Bil option.
12 Other Rule and Regulation Changes
13 Are there any other changes to United Water's curent Rules and RegulationsQ.
14 that the Company is proposing?
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Yes. The. Company is proposing a mior wording change on sheet No. 18,
Paragrph 44 with regard to where the Company's responsibilty lies for fie
protection service connections. Attched as Exhbit No.2 is Paragrph 44 with
the proposed languge change in both legislative and clean format, along with
Pargraph 7 of Sheet No. 12 which describes all other service connections.
Why does the Company wish to make ths change?
This chage is proposed in order to accomplish the following:
~ To more appropriately designate the location, paricularly in the downtown
area, where the Company's and the customer's responsibilties lie with
regard to private fire protection services.
~ To align the languge for private fire protection services with the curent
language for all other servce connections found in Pargraph 7, Sheet No.
12 of the Company's curent Rules and Reguations.
~ To bring the languge in paragraph 44 in line with long-stading private fire
service line constrction and instalation practices.
Q.Please explain.
A.For many year the constrction and instalation practice for private fire
protection services has been the same as for all other servces.' The Company
taps.the main line and instals the Company portion of the servce to connect to
the private fire servce line stubbed out by the contractor or owner. In virtually
all cases this connection point is just a short distace back of the curb line.
Wyatt,Oi 22
United Water Idaho Inc.
.1 Q.Is that tyically where the "propert line" as stated in Paragrph 44 is found in
2 the downtown area where many private fire protection services are located?
3 A.No, and that is gist of the problem. Typically in the downtown area the propert
4 line is the buildig wall/foundation line, and from there to the roadway is Ada
5 County Highway Distrct right-of-way.Even though virly all downtown
6 private fire protection services are instaled as described above, the curent
7 Paragraph 44 languge makes the Company responsible for the service line right
8 up to the foundation wall, when in actuity tht portion of the servce line is not
9 Company property but is the property of the customer.
10 Q.Could the Company's constrction practices be changed so as to comply with
11 the curent rue languge?.12 A.No. To do so would requie the Company to instal its side of the service line
13 not only up to the building wall/foundation line, but though the wall and inside
14 of the building in order to make the connection to the customer's plumbing.
15 This would requie having Company assets inside of private customer premises
16 and would also require a plumber's license.Both of which are undesirable from
17 the public utilty perspective.
18 Q.You said that Ada County controls the right-of-way outside of the propert line.
19 Wouldn't your requested languge change result in private customer propert
20 being located with the County right-of-way?
21 A.Yes, however that sitution already exists thoughout the downtown area by.22 virte of how the private fire service lines have historically been installed and
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connected as described above. Also, many downtown establishments have
below ground basement areas tht reach out beyond the propert line into the
right-of-way area. In addition, many private fie protection serices ar
requied to have a post indicator valve instaled on them. An example of ths
device along with the meter pit for the service located at 624 Idaho Street is
pictued in the attched Exhibit No.3. These devices are reguarly instaled by
the customer's contractor on the fire service line at the point where the
Company and customer servce lines meet. As seen from Exhbit No.3, they
are routinely placed with the County right-of-way, often just inside the curb
line.
Q.If the languge in Paragraph 44 is not chaged as proposed by the Company, is
there a potential financial risk to the Company and ultimately to all customers?
A.Yes. If the Company is held to be responsible for maintaning and ultimately
14 replacing private fire service lines that rightly belong to individua fie servce
15 customers, then the costs for such operating expenses and capita expenditues
16 will increase and ultimately need to be recovered in rates applicable to all
17 customers.
18 Water Conservation
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Q.Would you please provide an overview of the Company's water conservation
and demand side management efforts and programs?
A.For over 15 years the Company has developed and implemented vanous
customer information, education and awareness programs, and outreach effort
that promote wise water use and water conservation and tht assist customers in
VVyatt, Oi 24
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1 managing their water demand and consumption. Although some of these efforts
2 have sought to inorm customers about water use in the home, the majority of
3 them have tageted customer water use outside on lawns, gardens and landscape
4 areas. This focus is designed to enable customers who use water provided by
5 the Company for irgation puroses to benefit the most from the Company's
6 effort, since irrgation demand is the largest drver of overall water system
7 demand in the sumer.
8 Below is a brief sumar of the Company's efforts in these areas:
9 Water Effcient Landscaping Classes:
10 In Februar of each year, United Water, in parership with the Ada County
11 Extension Offce and the City of Boise, conduct six, two-and-a-half-hour class
12 sessions focused on the fundamentas of water effcient landscaping. In the past
13 three years an average of 563 adult individuas attended the classes.
14 Water Awareness Week
15 In the sumer of each year, United Water paricipates in Water Awareness
16 Week, which promotes water education and conservation information for school
17 students in Region 3 (which includes the Boise area) via teacher workshops and
18 though conservation education materials provided to teahers.
19 Free Indoor/Outdoor Water Conservation Kit for Customers
20 Customers who request an indoor water conservation kit are provided one free
21 that includes a low flow showerhead, faucet aerators and toilet das. In
22 addition, free indoor water conservation kits are provided to low income
VVyatt, Oi 25
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1 customers who receive assistace though United Water's low income
2 assistace program, UW Cares, which is adstered by El-Ada Communty
3 Action Parership.
4 Sumer Water Conservation Bil Inert
5 As customer bils are delivered thoughout the spring and sumer, the bil
6 tyically includes an insert that provides information on how customers can
7 reduce their outside water demand durg the summer.
8 Water Use Management Messaging Though the Media
9 The overall media effort is designed to increase customer's awareness of their
10 water use and to provide them with concrete reminders and methods to manage
11 their water consumption. This consists of a coordinated use of newspaper and
12 television to communcate wise water use and management thoughout the
13 sumer. Beginng in 2005, United Water has produced an Anua
14 Conservation Guide, which is placed in the Idaho Statesman as an advertsing
15 supplement in June. The Conservation Guide is also distrbuted for display at
16 Boise City Hall, the Foothlls Learng Center, and the Boise Watershed
17 facilty. The Guide includes eight pages of water supply inormation and both
18 indoor and outdoor water use conservation inormation tht customers can use
19 to reduce their anual water usage and cost. The supplement is designed for
20 customers to easily save and refer to the information year-round. In addition, 8
21 short commercials featung water conservation messages and reminders (5
22 outdoor and 3 indoor) are played June to September on regular and cable
23 networks. Additionally, United Water has parered with Idaho Rivers United
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1 on a newsprint and television advertising campaign focused on conservation and
2 preservation of the Boise River water source.
3 Xeriscape Demonstration Garden
4 In 2006, United Water instaled a Xeriscape, or low-water use, demonstration
5 garden at its mai offce location on Victory Road. The garden conta over 45
6 drought-tolerat plant vareties and is confgued with appropriate signage in a
7 wal-though venue. A listing of plants is available for customers at the offce
8 and on our web site, and the Company's Outreach and Education Coordintor
9 conducts educational workshops for customer groups using the garden as the
10 centerpiece since its constrction. Additionally, United Water is financially
11 supporting the instalation of a new low-water use garden located at the Idaho
12 Botacal Garden ths sumer, and has reached agreement with the State of
13 Idaho, Deparent of Administration for two such xeric gardens to be instaled
14 on the Capita grounds upon completion of the Capita expanion and
15 restoration project ths falL. United Water is working with both of these entities
16 to coordinate messaging, signage, and water conservation educationa materials.
17 Hidden Sprigs Targeted Conservation Plan
18 At the beginnng of the sumer of 2008, United Water initiated a specific
19 conservation messaging effort tageted for the approximately 700 residential
20 customers of the Hidden Springs communty. These customers have no access
21 to alternate irgation water and use United Water for all indoor and outdoor
22 puroses including lawn irrgation. In conjunction with the Hidden Springs
23 Open Space Manager, the Company displayed its Anual Conservation Guide,
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varous other conservation literatue, plus coupons for free water saving devices
at the Hidden Sprigs Mail Room. Then the residential customers were sent
two diret-mail pieces. The fist was a postcard notifyg residents of the
conservation materials in the Mail Room, and the second mailing was a color
brochure made especially for Hidden Springs providing landscaping, watering,
and genera conservation tips.
Educationa and Community Outreach
United Water has developed varous water awareness and conservation
presentations that are available to schools and communty organzations in the
area. These include PowerPoint presentations, topical lectues, school skits and
a video librar. The Company also paricipates in communty events where
conservation materials and information are provided, including Ear Day,
Idaho Green Expo, Boise School's Teacher Night Out, Idaho Botacal Garden
Landscaping Symposium, Idaho Deparent of Environmenta Quaity's Green
Fai, as well as meetings with varous neighborhood associations throughout the
service area.
Cónservation Plan
Q.Please comment on the Company's efforts to implement its updated
Conservation Plan.
A.As a result of the Company's 2004 case (UWI-W-04-04) the Commission, in its
September 20, 2005 Order No. 2987l directed the. Company to prepare an
updated conservation plan and submit it to the Commission for review. United
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Water prepared and then fied its updated Consrvation Plan with the
Commssion on December 1, 2006 (UWI-W-06-05), and by Order No. 30305
dated April 18, 2007 and Order No. 30305 Errta dated May 22, 2007, the
Commission approved implementation and associated cost deferr of four
specific programs from the updated Conservation Plan; specifically Xeriscape
demonstrtion gardens, ran sensor retrofit, trgger shut-off valves and hose
timers, and restaurant low flow spray nozzles.
Q.Please describe the Company's implementation effort regarding the four
programs since Commssion approval in April 2007.
A.United Water began promoting the trgger shut-off valve and hose timer
program via a free coupon in its 2007 Conservation Guide. Customers were
encourged to bring the coupon from the Guide into the offce and receive the
free devices. The program was also promoted via signage at the Company's
offce where extra coupons were also available, at public shows and displays,
and on the Company's web site. Ths program was promoted in the same
fashion durng the sumers of 2008 and 2009. As of August 21, 2009, 2,066
kits (each contaning a trgger shut-off valve and hose timer) have been
provided to customers.
In the sumer of 2008, the Company began implementing the rain sensor (shut-
off device) retrofit on irrgation controllers program. Ths program involves
purhasing and providing a rain sensor device at no cost to customers. The
device connects to the customer's automatic irrgation system and interrpts the
scheduled watering cycle whenever sufcient raifall is detected by the device.
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Ths program was promoted in the sae way as the trgger shut-off valve and
hose timer progr via the anua Conservation Guide, offce signage, public
shows and displays, and on the Company web site. This program was promoted
in the same fashion durg the sumers of 2009. As of August 21,2009, 830
rain sensors have been provided to customers.
For both the trgger shut-off / hose timer, and rain sensor progrs the
Company mailed letters to all neighborhood association presidents with the
service area advising them of the free devices along with extr coupons.
The restaurant low flow spray nozze change out program is getting
underway in 2009. In this progr the Company identifies customers, such as
restaurts, who have commercial kitchen facilties, and replaces their existig
rinse and clean spray nozzles with low flow unts at no chage. The Company
entered into an agreement with a licensed plumbing contractor in Augut 2009
for the installation of these devices for customers.
The Company's efforts regarding the four program approved by the
Commssion in 2007, Xeriscape demonstration gardens, has aleady been
discussed above.
Q.Do you believe the Company has implemented the approved Conservation Plan
progrs in the way the Commission intended?
A.Yes. The Company has made a dilgent effort implementing the four approved
programs, while at the same time it has maintaned and improved its previous
conservation efforts.
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Q.Do you believe the Company's Conservation Plan efforts are showing success
though reduced water consumption by customers?
A.Yes. The two water use graphs provided earlier in my testimony on the
proposed Budget Bil plan clearly demonstrate tht customers are using less
water per capita in both the sumer and the witer. Certy a porton of ths
water use decline is attbutable' to the Company's diverse and widespread
efforts to promote water conservation.
Q.Has the Company shifted any costs from its historical conservation program
efforts to support the implementation of the four new conservation programs?
A.No~ Only new costs associated with the new programs have been recorded in
the deferred account (see Order No. 30063 in Case No. UWI-W-06-3) for which
the Company is seekig rate makg treatment in ths present case as described
13 in Witness Loy's testimony.
14 Customer Servce
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Q.Please comment on the Company's customer service efforts.
A.United Water uses varous measures and metrcs to ensure that it maintains a
high level of service and responsiveness to its customers. For example, the
Company tracks customer complaints it receives relating to water quaity.
Durng 2008, water quaity complaits that requied a field visit to resolve have
averaged only 0.60% of tota customers. Complaints relating to high bils and
disconnection have averaged only 0.38% and 0.46% respectively as a
percentage of bils rendered.
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Q.Are there other measures used by the Company to trck customer servce
performance?
A.Yes. Our Customer Service group maitas varous data relating to customer
calls, response time, lengt of call, and number of dropped calls. Durng 2008,
the Customer Service offce answered 92,679 calls with an average answer
speed of 26 seconds. The average lengt of calls was 2.27 miutes, and the
abandoned or dropped call rate wa 3.4% of all calls. Almost 26% of the
dropped calls occured durng the first 15 seconds of hold time and ths would
include those customers. who may have reached our offce in error (i.e. wrong
number) and hung up. Assuming a caller is willing to continue with the call for
more th 15 seconds, the dropped call rate falls to 2.8%. In addition, due to
the fact that virtly all customer meters are located in outside pits or vaults,
we are able to render bils based on actu meter readngs 98.6% of the time.
14 Q. Are there other customer service improvements the Company has made to
15 enhance the level and/or quaity of servce provided to customers?
16 A. Yes. In 2007 the Company made arangements through Western Union to add
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five additional payment locations thoughout the servce area, briging the tota
number of payment locations to seven. Also in 2007 the Company implemented
an interactive voice response (IVR) system via a 1-800 phone number that is
available 24/7 to enable customers to pay their bil by phone. In the 1 st quaer
of 2009 the Company rolled out a completely redesigned website
(ww.unitedwater.com) which includes signficant customer servce
enhcements including updated water conservation information, a news center
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1 and many other usefu featues. The new website also offers customers the
2 opportty to enroll their account which then enables them to view their bils
3 and payments history on-line. At about the same time United Water began to
4 offer customers an e-biling option in which they can receive and pay their
5 water bil on-line. Customers can enroll in e-biling via the website, or by
6 caling or visitig our customer service offce.
7 Low-Income Customer Assistance
8 Does the Company curently have a low-income customer assistace program inQ.
9 place?
10 Yes. Beginng in September 2005 the Company intiated UW Cars, which isA.
11 the first and only water utility customer assistace program in the state. The
12 program, which is admnistered though the El-Ada Communty Action
13 Parership social servce organzations, provides up to $50 anua water bil
14 assistace to quaifyg customers. The Company curently fuds the program
15 and will match customer contrbutions into the fud up to $20,000 anualy.
16 Additionally, the Company provides the agencies with indoor and outdoor water
17 conservation kits for distrbution and instalation for quaified customers in the
18 program. Since UW Cares began in 2005, the Company's shareholder has
19 provided more than $36,000 in assistace to qualified customers to help pay
20 their water bils.
21 Also, durg its 2004 rate proceeding (Uwi - W -04-04), the Company
22 supported and agreed to a proposed change in it's rate taff whereby the first 3
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hundred cubic feet (ccf) of consumption used durng the sumer rates period
(May though September) is priced at the 25% lower witer rate.
Q.Does ths conclude your testimony?
A.Yes.
Wyatt,Oi 34
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Sheet No. i 7A
Replacing All Previous Sheets
I
RECEtVEDUNITED WATER IDAHO INC.
ZOß9 SEP -3 PH 4: 0'BUDGET BILL PLAN
IDAHO PU8UÇ ..,41. Residential Budget Bill Plan: A Budget Bill PIå.,'nålã~~i\!~!B~ntial Customers,
as defined in paragraph 51 of these Rules, desiring to levelize payments for water service. A
residential customer may enroll in the Budget Bill Plan at any time during the year. To be
eligible for the Budget Bill Plan, the customer must have a minimum of 12 consecutive months
of service at the current location and have no past due balance owing at the time of
enrollment. Residential Budget Bill Plan participants will receive monthly biling statements,
though their meters will continue to be read on a bi-monthly basis.
The levelized monthly payment will approximate the 12 month average of the most current 6
bi-monthly bills. Budget Bill Plan a mounts will be recalculated annually at the 12-month
anniversary of the date the customer began paying the most current Budget Bill amount. The
new monthly payment will be the recalculated Budget Bill amount. A customer's Budget Bill
amount may decrease, increase, or remain the same from year to year.
Customers with a negative (underpaid) balance in their Budget Bill Plan account at the time of
recalculation wil have new monthly Budget Bill Plan charges equal to the recalculated Budget
Bill amount plus one-twelfth of the negative balance. At the customer's option, a negative
balance may be paid in full and disregarded for purposes of calculating the next period's
Budget Bil amount. If the negative balance exceeds 25% of the estimated annual bil for the
ensuing annual period, the Company may request that the negative balance be paid in fulL.
Customers with a positive balance exceeding $25 in their Budget Bill Plan account at the time
of recalculation may be refunded at the customer's request. If no request for refund is made,
the monthly Budget Bill Plan charge will be equal to the recalculated Budget Bill Plan amount
reduced by one-twelfth of the positive balance. Upon termination of the Budget Bill Plan
agreement, after all charges for services are paid, positive balances will be refunded at the
customer's option.
Estimates of future costs based on historical charges furnished by the Company with such
Budget Bill Plan should not be construed by the customer as a guarantee that the total actual
charges will not exceed the estimates. In the event of a significant change in rates for water
service or substantial deviation from the customer's historical water consumption, the
Company may at any time submit a revised estimate to the customer and require that the
customer pay the revised monthly Budget Bill installment amount as a condition of èontinuation
in the Budget Bill Plan.
The Budget Bill amount will be biled monthly. Once established, the Budget Bill Plan will
remain in effect from year to year until the customer notifies the Company not less than 30
days prior to the desired date of cancellation or unless the customer fails to pay the Budget Bill
amount.
Issued:Effective: October i 2009Octoberi 2009
Under Authority of I. P . U. C. Order No.
Issued by:UNITED WATER IDAHO INC.
By:Gregory P. Wyatt i Vice President
Case No. UWI-W-09-01
Exhibi t No. 1
G. Wyatt
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Sheet No. 18, Paragraph 44 - Legislative Format lUnQ stl -3 PM I.t 0 \
p'ißLtG
44. All private fire service connections from the main to inside th U M\SS\ON
Company right-of-way the propert liae, including all valves, shall be ned and installed by
the Company.
Sheet No. l8, Paragraph 44 - Clean Format
44. All private fire service connections from the main to inside the curb line or
Company right-of-way, including all valves, shall be fuished and instaled by the Company.
Sheet No. 12; Paragraph 7
7. The Company will mae all connections to its existing mains which front the
property to be served and will fuish, install, and maintan all service lines from the main to and
including the meter box or vault, meters and service setting. The meter box or vault shall be
placed inside the curb line or Company right-of-way (emphasis added). All service lines
shall be property of the Company and shall be accessible to and under its control. In instances
where the existing mains do not front the property to be served, the Applicant shall enter into the
appropriate main extension agreement as provided under Company's Rules and Regulations
Governing Main Extensions.
Case No. UWI-W-09-01
Exhibit NO.2
G. Wyatt
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ó2Li Idtu C"ü lW 0-cr Li('
:5re
s~0.00°:ifØ..-Of--::
j:::Case No UWI-W-09-01
Exhibit No.3
G. Wyatt