20230308Cary Rebuttal Testimony.PDF

Preston N. Carter ISB No. 8462
Blake W. Ringer (SB No. 11223
Givens Pursley LLP
601 W. Bannock St.
Boise, ID 83702
Telephone: [phone]
Facsimile: [phone]
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[e-mail]

Attorneys for Veolia Water Idaho, Inc.

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE
APPLICATION OF VEOLIA WATER
IDAHO, INC. FOR AUTHORITY TO
INCREASE ITS RATES AND CHARGES
FOR WATER SERVICE IN THE STATE
OF IDAHO

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Case No. VEO-W-22-02

REBUTTAL TESTIMONY OF JARMILA CARY
FOR VEOLIA WATER IDAHO, INC.
MARCH 8, 2023
RECEIVED
2023 March, 8 4:42PM
IDAHO PUBLIC
UTILITIES COMMISSION
CARY, Di-Reb
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Veolia Water Idaho, Inc.
Q. Please state your name and business address. 1
A. Jarmila M. Cary, 8248 West Victory Road, Boise, Idaho 83709. 2
Q. Are you the same Jarmila Cary who previously provided direct testimony in this 3
case? 4
A. Yes. 5
Q. What is the purpose of your rebuttal testimony? 6
A. I will address several adjustments proposed by the Idaho Public Utilities Commission 7
Staff (“Staff”) and certain intervenors regarding operating costs that are discussed in my 8
testimony, including: 9
● The proposed Test Year ending period, 10
● Salaries and Wages, 11
● Workers Compensation, 12
● Post-retirement Benefits Other than Pension (PBOP), 13
● Employee Healthcare, 14
● Payroll Overheads (Fringe Benefit Allocation), 15
● Customer Billing Expenses, 16
● Office Expenses, 17
● General Insurance, 18
● Safety, 19
● Unadjusted Expenses - Miscellaneous Costs, and 20
● Adjustment to Variable Expenses Due to Volume Normalization. 21
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Veolia Water Idaho, Inc.
Company Witnesses Wilson, Jacob, and Cagle will discuss other operating and 1
maintenance expense adjustments in their rebuttal. 2
I will also address several recommendations proposed by Staff related to customer 3
issues. 4
Q. Have you prepared any exhibits to support your rebuttal testimony? 5
A. Yes. I have prepared the following rebuttal exhibits: 6
● Exhibit 20 Schedule 1 - Operating Expense Summary 7
○ Adjustment 1 - Payroll 8
○ Adjustment 2 - Workers Compensation 9
○ Adjustment 4 - Post-retirement Benefits Other than Pension (PBOP) 10
○ Adjustment 5 - Employee Healthcare 11
○ Adjustment 8 - Payroll Overheads (Fringe Benefit Allocation) 12
○ Adjustment 13 - Customer Billing Expenses 13
○ Adjustment 17 - Office Expenses 14
○ Adjustment 20 - General Insurance 15
○ Adjustment 22 - Safety 16
○ Adjustment 29 - Adjustment to Variable Expenses Due to Volume Normalization 17
○ Adjustment 30 - Unadjusted Expenses - Miscellaneous Costs 18
Test Year End 19
Q. Please summarize the recommendations made by Staff Witness English to the 20
Company’s proposed Test Year ending period. 21
A. The testimony of Staff Witness English proposes to update the Company’s test year to the 22
12 months ending December 31, 2022 and removing all pro-forma 2023 adjustments. 23
CARY, Di-Reb
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Veolia Water Idaho, Inc.
Q. Do you agree with Staff’s recommendations for the proposed Test-Year ending 1
period and eliminating all pro-forma 2023 adjustments? 2
A. No. It is the Company’s opinion that reasonable, known and measurable adjustments 3
should be included in the Company’s operating expenses for recovery, after Staff’s 4
proposed December 31, 2022 Test Year end period. Costs that have already been incurred 5
as well as those that can be reasonably measured and have a high degree of certainty of 6
being realized before the conclusion of a rate proceeding, before the new rates will be in 7
effect, should be included for Commission’s consideration to the extent possible. It is 8
widely accepted by the National Association of Regulated Utility Companies (NARUC) 9
that known and measurable adjustments “should have a strong degree of certainty 10
associated with them, and that there should be a reasonable ability to measure the item 11
underlying the adjustment.”1 12
Q. Please summarize the recommendations made by Staff and Intervenors to the 13
Company’s Operating Expenses that were discussed in your testimony. 14
A. The testimony of Staff Witness Johnson proposes several adjustments, summarized as 15
follows: 16
● Adjustment 7, proposes adjustments to payroll related expenses by: eliminating 17
$304,854 of wages for 4 positions not filled as of December 31, 2022 including an 18
Operator 1 position, Cross Conn Control Specialist, Utility Person, and 19
Environmental Health & Safety Specialist; removing 2023 pay increases of $402,776; 20
removing 2023 increases for stand-by pay of $1,176; removing 2023 incentive pay of 21
$597,450; and removing 2023 increases for overtime pay of $14,514. 22

1 Rate Case and Audit Manual Prepared by NARUC Staff Subcommittee on Accounting and Finance (2003).
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Veolia Water Idaho, Inc.
● Adjustment 8 proposes to reduce worker's compensation expense by $19,110. 1
● Adjustment 9 proposes to reduce post-retirement benefits other than pension $54,144 2
to December 2022 level. 3
● Adjustment 10 proposes to update healthcare insurance costs to 2023 rates but based 4
on December 2022 employees for a reduction of $70,501. 5
● Adjustment 11 proposes to reduce employee 401(k) matching contributions by 6
$44,890 based on December 2022 employees. 7
● Adjustment 13 proposes to reduce Payroll Overhead fringe benefits based on 8
proposed payroll & benefit cost updates for a reduction of $203,700. 9
● Adjustment 15 proposes to eliminate a customer growth assumption for costs 10
associated with customer billing but updates costs to December 2022 level. 11
● Adjustment 17 proposes to reduces Office expenses by $27,544 for Cityworks 12
License costs and eliminates Consumer Confidence Report (CCR) postage mailing 13
costs. 14
● Adjustment 22 proposes to remove $29,250 of Safety Expenses for trainings no 15
longer offered or those that have yet to be scheduled. 16
● Adjustment 27 proposes to remove nine miscellaneous expenses $4,585 from the 17
Company's Unadjusted O&M - Miscellaneous Expense account. 18
Micron Intervenor Witness Groman’s testimony proposes to remove 15 full-time 19
equivalent (“FTE”) employee positions included in the Company’s filing, for positions 20
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Veolia Water Idaho, Inc.
that were budgeted and not yet filled as of June 2022 to reduce test year operating costs 1
by an estimated $800,000. 2
The testimony of Staff Witness Culbertson proposes the following adjustments: 3
● Adjustment 1 proposes to update Unadjusted Expenses to December 31, 2022 level. 4
● Adjustment 21 proposes to revise General Insurance Expense and Injuries and 5
Damage claims by eliminating $28,947 of claims costs. 6
● Adjustment 20 proposes to revise the test year number from a two-year average 2020-7
2021 to a three-year average 2020-2022, which would result in a reduction of 8
$36,405. 9
The testimony of Staff Witness Eldred proposes, in Adjustment 28, to reduce 10
Variable expenses due to Revenue Normalization and to adjust the cost of power and 11
chemical expense due to the reduction in weather normalized test year consumption using 12
Staff's December 2022 Test Year. 13
Payroll 14
Q. Do you agree with Staff Witness Johnson’s proposed Payroll and related employee 15
costs adjustments and those proposed by Micron Intervenor Witness Groman? 16
A. No, I do not agree with removing unfilled positions that were not hired before Staff’s 17
proposed Test Year ending December 31, 2022, with removing the 2023 Pay Increases, 18
removing increase for Stand-By pay, removing all Incentive Pay and increase for 19
Overtime Pay, or removing all 15 budgeted as-filed positions proposed by Micron which 20
were included in the Company’s request. 21
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Veolia Water Idaho, Inc.
Unfilled Positions 1
Q. Have the 15 budgeted pro forma positions as-filed been since filled, including the 2
four unfilled positions that were vacant as of December 31, 2022? 3
A. Yes, all but one of the 15 budgeted pro-forma positions included in the Company’s as-4
filed request have been filled. Three of the four unfilled positions vacant as of December 5
2022, which included the Operator 1 position, a Cross Connection Control Specialist and 6
a Utility Person, have since been filled. The remaining unfilled position of the 7
Environmental Health & Safety Specialist is an active recruitment process. Candidates 8
for this position are being evaluated for selection. An offer of employment is anticipated 9
in March with the background check process to commence immediately after acceptance 10
and the employee start date would be in April 2023, before conclusion of this case and 11
the effective date of new tariff rates from this proceeding. 12
2023 Pay Increases 13
Q. Are the Bargaining Unit employee contractually obligated 2023 pay increases 14
known and measurable? 15
A. Yes. The Company’s collective bargaining agreement reflects wage schedules by year 16
and position. The negotiated and contractually obligated wages and wage increases are 17
defined in the contract and include pay for Stand-by time, Overtime and Shift Pay. The 18
contract reflects a 2.75% increase in bargaining unit wages effective April 1, 2023. The 19
as-filed amount of Bargaining unit employee wage increases is $161,610. The 20
Company’s opinion is that wage increases should be reflected on Bargaining unit 21
employee payroll costs, as well as stand-by pay and overtime pay because these wages 22
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Veolia Water Idaho, Inc.
are known, measurable and contractually obligated. It is the Company’s position that 1
bargaining unit wage increases should be reflected in payroll costs for recovery. 2
Q. Are the Non-Bargaining Unit 2023 pay increases known and measurable? 3
A. Yes. The Company is finalizing the 2022 performance evaluations for non-bargaining 4
unit employees in early March, the ratings guide wage increases. For Non-Bargaining 5
employees performance ratings consist of 70% individual objective performance and 6
30% Veolia Values performance (Respect, Customer Focus, Solidarity, and Innovation). 7
The overall Non-Bargaining Unit 2022 performance rating completed in March 2023 8
resulted in an wage increase of 3.6% with an effective date of April 1, 2023. The 9
Company’s as-filed position anticipated a 4% increase in Non-Bargaining employee 10
wages. The Company’s Rebuttal position removes 0.4% or $24,117 the difference 11
between the anticipated and actual wage increases for the Non-Bargaining employees. 12
Mr. Johnson proposed eliminating all wage increases, a total of $402,776. The 13
Company’s position is that pay increases are justified, necessary to adjust for cost of 14
living increases from rising inflation, and to allow for competitive wages to attract and 15
retain talent. The Company requests recovery of $161,610 for Bargaining Unit employees 16
wage increases and $217,049 for Non-Bargaining Unit employees, a total of $378,659. 17
Overtime & Stand By Pay 18
Q. Do you agree with Staff Witness Johnson’s proposal to remove the 2023 Overtime 19
pay increases of $14,514 and $1,176 pay increases for Stand-by pay? 20
A. No. Overtime pay and Stand-by pay rates are identified in the collective bargaining unit 21
agreement and follow the established rates of pay. As of April 1, 2023 bargaining unit 22
wages increase by 2.75% and Overtime and Stand-by pay will follow suit. The 23
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Veolia Water Idaho, Inc.
Company’s rebuttal position requests recovery of the as-filed $14,514 wage increases for 1
Overtime and $1,176 for Stand-by pay. 2
Incentive Pay 3
Q. Briefly describe the Company’s incentive programs. 4
A. The Incentive Programs are based on employee performance as it relates to achievement 5
of specific objectives, as well as Company performance, both in terms of safety and 6
financial results. Employee goals are structured with customer impact, Company 7
performance, and employee safety and wellbeing in mind. Incentive objectives include 8
efficiency and process improvements, employee development, innovation, and new 9
initiatives that are above normal assigned employee duties. Incentive Payments are 10
rewarded when employees meet or exceed goal targets, criteria requirements, safety, and 11
compliance training goals. 12
Q. Are the 2023 incentive pay amounts known and measurable? 13
A. Yes. The 2022 objectives and achievements have been evaluated for non-bargaining 14
employees and the incentive plan payments based on achieving those employee goals and 15
Company results are paid in March, 2023. According to the negotiated collective 16
bargaining contract the Company’s Bargaining Unit employees do not have an incentive 17
pay component as part of their compensation. 18
Q. What percentage of incentive pay is based on individual goals and Company 19
financial results? 20
A. The Non-Bargaining Hourly employee incentives are based on performance in safety, 21
required training, and community engagement, and for year ended 2022 results they total 22
$18,879. 23
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Veolia Water Idaho, Inc.
The Non-Bargaining Salaried employee incentives are based on individual goal 1
achievement and Company financial performance. For year end 2022 results, Salaried 2
employee incentive pay is $607,383 and comprises approximately 57% of that amount 3
based on non-financial results or objective achievement for $347,116, and 43% based on 4
Company financial performance for $260,267. The Company’s rebuttal position requests 5
recovery of the full as-filed amount of Incentive pay of $597,450. 6
Wage Comparison 7
Q. Please discuss Staff Witness Johnson’s average wage comparison. 8
A. The average wage comparison Mr. Johnson provided in his testimony from the Bureau of 9
Labor Statistics reflects historic wages appears to be based on year 2021 pay data. The 10
selected positions do not necessarily align with the Company’s positions. During 2022 11
the Company engaged a consultant to perform a compensation assessment to compare 12
Company wages to the market provided to Staff in response to Production Request No. 13
23. The specific job descriptions, not merely job titles, were matched to and compared 14
with market data obtained from 17 compensation surveys. The surveys were focused on 15
studies specific to Idaho and the Pacific Northwest. This assessment provided analysis of 16
45 positions comparing base wages and total compensation which includes incentive 17
payments, and determined that the Company’s overall average base pay is in the 37th 18
percentile of market and total compensation including incentive pay is in the 46th 19
percentile of market. This study supports the Company’s rebuttal position to include 20
incentive pay as part of employees overall compensation for recovery in rates. 21
CARY, Di-Reb
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Veolia Water Idaho, Inc.
Q. Please summarize the Company’s rebuttal position for payroll costs. 1
A. The Company’s rebuttal position is a test year payroll amount of $7,645,650 and includes 2
the impact of a $24,117 or a 0.4% reduction in the non-bargaining wage increase. This 3
gross payroll change (or total payroll which includes operating costs as well as payroll 4
costs that will be capitalized) must be adjusted by the applicable Operating & 5
Maintenance (O&M) ratio which is based on the Historic Test year percentage of 66.17% 6
calculated in Company’s Exhibit 10, Schedule 1. Applying that Payroll O&M ratio to the 7
$24,117 produces a rebuttal adjustment of $15,958. The Company’s rebuttal position for 8
Payroll will also flow through the associated schedules and impact Workers 9
Compensation, 401k, Payroll Overheads (Fringe Benefit Allocation) and Payroll Taxes as 10
well. Employee 401k and Payroll taxes are discussed in Company Witness Wilson’s 11
rebuttal testimony. 12
Workers Compensation 13
Q. Please discuss the Company’s rebuttal position for workers compensation costs. 14
A. The Company’s rebuttal position for Workers Compensation costs is based on the 15
Company’s rebuttal position for payroll expense of $11,554,333 and reflects a test year 16
expense of $115,965, a reduction of $242 from the as-filed position. 17
PBOP - Post Retirement Benefits Other than Pension 18
Q. Do you agree with Staff Witness Johnson’s PBOP update to December 31, 2022 19
level? 20
A. Yes. The $577,900 amount is based on the latest available Actuarial information. 21
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Veolia Water Idaho, Inc.
Healthcare 1
Q. Do you agree with Staff Witness Johnson’s Healthcare adjustment incorporating the 2
Company’s 2023 rates applied to December 31, 2022 actual count of employees? 3
A. Yes in part. I agree with the update per Company’s response to Request No. 163 which 4
updated the Healthcare costs from 2022 rates to the now known 2023 rates. However, I 5
disagree with excluding open positions that were vacant as of December 2022 because 6
those positions that have since been filled, or will be filled with a high degree of 7
certainty, before the conclusion of this rate proceeding. The Company’s rebuttal position 8
reflects the 2023 updated healthcare costs applied to 137 as-filed positions for a test year 9
amount of $2,414,650. 10
Payroll Overheads (Fringe Benefits Allocation) 11
Q. Please provide the impact of the Company’s rebuttal positions on payroll and 12
related benefit costs which drive the change to the Payroll Overhead (Fringe Benefit 13
Allocation) amount. 14
A. Incorporating the payroll and related benefit cost updates per the Company’s rebuttal 15
position, changes the Payroll Overheads fringe benefits allocation by ($110,498) to 16
($1,576,909). Mr. Johnson’s Exhibit 110 included the full ($577,900) Post Retirement 17
Benefits Other than Pension (PBOP) amount in error. The amount of PBOP expense that 18
should be reflected in the Payroll Overheads - Fringe Benefit allocation is only the PBOP 19
service cost of $180,871. This is because only the service cost portion can be included in 20
capitalized amounts. 21
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Veolia Water Idaho, Inc.
Customer Billing Expenses 1
Q. Do you agree with Staff Witness Johnson’s proposal to update test year costs to the 2
December 31, 2022 amount and eliminate the 1% customer growth impact on billing 3
costs? 4
A. Yes. The Company can accept the proposed changes to customer billing expenses as 5
proposed by Mr. Johnson. 6
Office Expenses 7
Q. Do you agree with Staff Witness Johnson’s proposal to eliminate Cityworks license 8
costs for 4 vacant positions not filled as of December 31, 2022 as well as the 9
estimated postage costs for mailing the Consumer Confidence Report? 10
A. No. This adjustment would eliminate costs that the Company has already incurred for 11
Cityworks licenses for new employees and the cost for mailing Consumer Confidence 12
Reports (CCR) to customers which were paid in March 2023. The CCR invoice reflects 13
$23,553 of postage that is estimated by the vendor based on current postage costs for 14
100,000 printed customer notices. The Company’s rebuttal position for test year office 15
expense is $819,200 and includes as-filed Cityworks license cost and reflects an increase 16
of $3,553 for CCR postage costs per Exhibit 20 Adjustment 18 Attachment A (CCR 17
Invoice) which is sponsored by Company Witness Wilson who discusses the advertising 18
costs for printing the CCR mailers in his rebuttal testimony. 19
Q. Please explain why Cityworks license costs are necessary? 20
A. All field related work for construction and maintenance related tasks is scheduled and 21
tracked in the Cityworks system. All employees who perform work in the field must 22
utilize the Cityworks system for their daily work assignments and require a separate 23
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Veolia Water Idaho, Inc.
license. Supervisors, Managers and Administrative staff along with the Customer Service 1
Representative call center staff utilize Cityworks as part of the daily work flow process. 2
The historic test year expense for Cityworks licenses was $179,772. The Cityworks 3
license is a single user fee of $1,886 per user currently, charged per year. There are 4
currently 118 user licenses x $1,886 = $222,582. The current count of 118 licenses have 5
been paid and will cover newly hired and existing employee license requirements. 6
Q. Please discuss why the Company mails the Consumer Confidence Report when it 7
may be provided to customers electronically? 8
A. The Idaho Department of Environmental Quality (IDEQ) and the Environmental 9
Protection Agency (EPA) require that customers be notified their annual Consumer 10
Confidence Report (CCR) is available to them. Idaho allows all sizes of community 11
public water systems the option to deliver Consumer Confidence Reports (CCRs) 12
electronically. All community public water systems are required to deliver CCRs to their 13
customers by July 1st of every year and provide a certification to the Department that 14
CCRs were delivered. According to the IDEQ website, the Environmental Protection 15
Agency (EPA) interprets the requirement to mail or otherwise directly deliver to include 16
electronic delivery. 17
The Company has provided electronic CCRs to customers previously, but found 18
that customers do not access that information. Customers were notified via our Facebook 19
and Twitter pages, a digital banner ad on IdahoStatesman.com with a link to a sponsored 20
news article about the CCR, and a bill message for customers who receive their statement 21
on paper or electronically. All forms of notification let customers know how to find their 22
CCR on our website. After analyzing the click rate on the Idaho CCR web page for the 23
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Veolia Water Idaho, Inc.
past two years, we determined less than 0.1% of our customers are landing on the page. 1
The Company feels strongly that the CCR is an important document for customers to 2
review and understand what is in their water, what tests are performed, and their results. 3
Due to the low digital readership of this important information , which must be provided 4
pursuant to regulations, the Company’s position is that this information should be mailed 5
to all customers. This type of push notification will land the CCR in customers’ hands 6
directly. 7
Safety Expenses 8
Q. Do you agree with Staff Witness Johnson’s Safety Expense adjustment to eliminate 9
$29,250 training costs that will not take place or be completed before the conclusion 10
of this rate case? 11
A. Yes. 12
General Insurance 13
Q. Do you agree with Staff Witness Culberton’s General Insurance adjustments? 14
A. Yes, in part. Mr. Culbertson’s proposed 3-year average of General Insurance costs is 15
reasonable. I do not agree with excluding certain general insurance costs or claims that 16
could be attributed to Company employees’ actions or errors. Insurance coverage for 17
damages and liability is in place for a variety of events and scenarios. While it may be 18
argued that certain claims and related insurance costs could or should be avoidable, they 19
result in a legitimate business expense whether a Company employee was involved or 20
not, or whose actions or omission may have contributed to an accident. Insurance claims 21
and incidents are carefully reviewed, analyzed, addressed with the insurance Company 22
and by Company’s personnel. If deemed appropriate, counseling or additional 23
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Veolia Water Idaho, Inc.
progressive discipline may be necessary, and further training may be provided to 1
employees to help prevent similar situations from recurring. The Company emphasizes a 2
strong safety culture and provides a comprehensive safety training curriculum to its 3
employees, and contractors, focusing additional effort on high risk work situations or 4
activities. Mr. Culbertson’s Exhibit 134 reflects the as-filed General Insurance cost which 5
were later revised and provided to Staff in response to Production Request No. 63 as 6
Attachment No. 3 - Exhibit 10 Revised - Opex Adjustments.xlsx. This revision corrected 7
the excluded reserve amounts for Injuries & Damage Reserve amounts which are 8
essentially accruals of actual costs that should not have been excluded from the as-filed 9
expense. The excluded reserves already incorporated the Incurred But Not Recorded 10
(IBNR) Reserve amounts which are based on estimated costs and therefore should still be 11
excluded from operating expenses because those amounts may necessarily not be known 12
or measurable. The excluded reserve revision increased year 2020 expense from the as-13
filed $172,526 to a revised $580,298, the 2021 expense from $312,522 as-filed to 14
$466,550 revised, and the June 2022 Historic Test Year from $91,347 as-filed to a 15
$271,746 revised. Using these updated year-end figures with the December 2022 year 16
ended insurance expense of $133,309 for the three-year average that Mr. Culbertson 17
proposes, would raise the test year amount from Staff’s position of $177,172 to $364,439 18
per Staff’s Adjustment 3 Exhibit 134. The Company’s rebuttal position includes the 19
$28,947 of Staff's proposed excluded claims costs for a test year amount of $393,386. 20
Unadjusted Expenses - Miscellaneous Costs 21
Q. Do you agree with Staff Witness Culbertson’s proposal to bring Unadjusted 22
Expenses to December 31, 2022 level? 23
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Veolia Water Idaho, Inc.
A. Yes. 1
Q. Do you agree with Staff Witness Johnson’s Miscellaneous Cost adjustment? 2
A. Yes, in part. I agree that as part of Unadjusted Expenses, Miscellaneous Costs such as 3
Chamber of Commerce fees, certain advertising expenses and political contributions 4
should be excluded from recovery and not be borne by customers. The Company’s 5
rebuttal position excludes $994 of costs that should have been reflected as non-6
recoverable. However the Company’s position is that costs for customer outreach and 7
educational events should not be excluded. Mr. Johnson’s proposal excluded $4,585 of 8
costs, including $3,592 of costs for events such as the Company’s Water Summit event 9
and two Company open house events for engaging and educating customers that should 10
be recoverable. These three events Staff proposed to exclude were held at Hilton Garden 11
Inn locations and included rental of the meeting space, audio-visual rental costs, coffee 12
and snacks. 13
Water Summit Event 14
As the water provider to more than a quarter of a million people, we often get 15
questions from local leaders, the media, and our customers about how much water we 16
need and if we are prepared to meet demand. To add context, the Valley had endured a 17
challenging drought in 2021 that made headline news for months. We commissioned the 18
Treasure Valley Water Supply Report to provide data on the water available now, what 19
we can expect water demands to be as the population grows, and options - backed by 20
facts - of how to meet those demands. We also felt strongly that any findings should be 21
made public so our customers, community leaders, other regional utilities, and our 22
regulators had the same information. We invited community leaders from across the 23
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Veolia Water Idaho, Inc.
valley, our regulators, irrigators, and the press. The Commission sent a group of Staff to 1
the event, as did the Idaho Department of Water Resources, Department of Water 2
Quality, City of Boise, and many other stakeholders. About 70 people attended, and the 3
report was widely distributed, both at the event and after. Logistically, Veolia does not 4
have a meeting space that would host that many people. The Hilton Garden Inn hotel was 5
a neutral and central location to host everyone. Additionally, Veolia has heard from 6
stakeholders that they want more transparency regarding what we do and why. That was 7
a point of concern during our rate case in 2020. This supply report outlines avenues 8
Veolia intends to explore in order to meet community needs for the next 50 years. It is an 9
important planning tool that we made available to everyone. 10
Customer Engagement & Education Events 11
The Company held two events open to all customers in and around the Eagle area 12
which were proposed to be excluded from recovery by Mr. Johnson. These customer 13
engagement and education events allow new and existing customers to meet and discuss 14
topics with various Company employees and obtain assistance. Customers are provided 15
opportunity to ask questions, raise concerns, learn about various topics, access the 16
company’s customer website, sign up for customer conveniences such as paperless billing 17
and electronic payment options, view their account information including consumption 18
history, bill and payment history, understand tariff rates, receive conservation devices and 19
advice, learn about water quality, and system improvement projects that were underway 20
or planned. 21
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Veolia Water Idaho, Inc.
Adjustment to Variable Expenses Due to Volume Normalization 1
Q. Please discuss the impact of the Company’s rebuttal positions on the Adjustment to 2
Variable Expenses Due to Volume Normalization. 3
A. Incorporating Company Witness Michaelson’s Volume Normalization updates will 4
require an adjustment to the Company’s power expense and chemical expenses. The 5
variable expense associated with the change in Volume Normalization is a difference of 6
$2,089 of power & chemical costs from the as-filed amount of ($127,937) to the 7
Company’s rebuttal position of ($125,848). Company Witness Michaelson’s adjusted 8
Test Year Consumption of 18,758,373 hundred cubic feet (CCF) is adjusted for the 9
impact of rebilled consumption due to under-reported meter reads as provided in response 10
to Production Request No. 163 producing a Rebuttal Test Year amount of 18,817,988 11
CCF. 12
Customer Issues 13
Q. Please summarize the recommendations made by Staff relating to customer issues. 14
A. The testimony of Staff Witness Bossard proposes recommendations that would impact 15
customers, including a recommendation to submit the customer notice and press release 16
to the Commission for review prior to submitting its Application in future cases, a 17
recommendation that the Company communicate with the Commission when it 18
recognizes a possible issue that could generate complaints from a significant number of 19
customers, a recommendation that the Company continue to support the Veolia Cares 20
Low Income Financial Assistance Program and to increase the amount of the grant to 21
reflect the increase in rates for residential customers. Staff also recommends that the 22
Company increase the amount of assistance an individual customer can receive in the 23
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Veolia Water Idaho, Inc.
same percentage as the rate increase for residential customers granted in the final order to 1
reduce the effects of the rate increase and higher inflation levels. Staff also recommends 2
that the Company increase the maximum household income level to reach more 3
customers threatened by disconnection for non-payment and prevent additional disruption 4
of customer service. 5
Press Release and Customer Notices 6
Q. Do you agree with Staff Witness Bossard’s testimony regarding the Customer 7
Notification and recommendation to submit the customer notice and press release to 8
the Commission for review prior to submitting its Application in future cases? 9
A. Yes. While the Company’s customer notice met the Commission’s Rules of Procedure, 10
Rule 125 requirements, the press release did not because as Ms. Bossard noted, it failed 11
to inform customers that they could file comments with the Commission. The Company 12
appreciates Staff pointing out that omission so it can be addressed. While it would be 13
preferred that the customer notice and press release include the Application Case Number 14
assigned by the Commission, that does not appear to be an explicit requirement of Rule 15
125. The Company did not include the case number on the customer notices because that 16
information was not available at the time the notices were being printed. The Company 17
will however make a concerted effort in the future proceedings to provide Commission 18
Staff the opportunity to review the customer notice and press release ahead of filing the 19
Application and to include the Application Case Number. 20
Q. Do you agree with Staff Witness Bossard’s recommendation to notify Staff as soon 21
as the Company recognizes a potential large-scale issue that will affect customers? 22
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Veolia Water Idaho, Inc.
A. Yes. It is our priority to keep Commission Staff apprised of potential large-scale issues 1
that may negatively impact customers and to address those concerns as quickly as 2
possible for customers. As the Company became aware of under-reported meter readings 3
in December 2022, the issue was discussed with Staff members via phone. At the time 4
the impact was not known and the Company was responding to customer and Staff 5
concerns. The subsequent Company investigation determined that fewer than 1% of 6
customers were impacted. The Company began reaching out to impacted customers to 7
advise them of the corrective actions that were taking place, and what they should expect 8
while tracking those instances. As the Company’s investigation progressed, information 9
was shared with Staff on a weekly basis as requested regarding the number of customers 10
impacted, and a virtual meeting was held in January with Staff to provide additional 11
clarity and an update on the Company’s investigation. The Company has and will 12
continue to work with customers who face hardship in order to find a solution to address 13
their specific concerns and keep Staff apprised of large-scale issues that may impact 14
customers in the future. 15
Service Level Standard 16
Q. Please address the Company’s service level standards discussed in Staff Witness 17
Bossard’s testimony? 18
A. The Company’s Average Speed of Answer target - 80% of customer calls answered 19
within 60 seconds or less was not achieved during the months of August, September and 20
October 2022, due to employee vacancies and leaves of absence for medical reasons. 21
During that time, customers had a longer than normal average wait time before they 22
could speak to a Customer Service Representative, ranging between 75 seconds and 170 23
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Veolia Water Idaho, Inc.
seconds. The Company was actively recruiting employees during that time and utilized 1
other available staff to answer customer calls, however our service level was below target 2
during that time. After the open positions were filled and employees returned from 3
medical leave, customer call wait times dropped below the target threshold. 4
VeoliaCares Low Income Financial Assistance Program 5
Q. Please address the Company’s Veolia Cares low-income financial assistance 6
program discussed in Staff Witness Bossard’s testimony? 7
A. The Company’s Low-Income Financial Assistance Program, Veolia Cares, provides 8
financial assistance to customers who qualify under the federal poverty guidelines 9
determined by El-Ada Community Action Partnership. The amount of assistance an 10
individual customer is granted will increase in each subsequent rate proceeding and 11
change in the % change in rates granted by the Commission in accordance with the 12
Company’s Case No. UWI-W-15-01 Settlement Stipulation. The Company advises 13
customers of available assistance programs and resources through its daily interactions 14
with customers, via the Company’s website, other communication channels, and via a 15
pamphlet that is provided to all customers informing them about financial assistance 16
programs available as well as the federally sponsored program LIHWAP. 17
It is unclear from the testimony what “previous lack of record keeping in the 18
Veolia Cares program” Staff Witness Bossard is referring to. The Company tracks the 19
number of customers who have received financial assistance as well as the amount of 20
funds provided by the Company’s shareholders to those customers. This information has 21
been shared with Commission Staff in Production Request Nos. 125, 126 and 127. No 22
additional information is tracked or available outside of what is required of all customers 23
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Veolia Water Idaho, Inc.
in order to obtain water service is available to Veolia. No additional information is 1
tracked about customers who apply for, are granted eligibility for low-income assistance 2
by El-Ada or those that are disqualified. No information regarding customer eligibility, 3
income levels or other information provided by customers to El-Ada in order to 4
determine eligibility is provided to nor requested by the Company. 5
As recommended by Staff, the Company will discuss with El-Ada the maximum 6
household income levels the agency uses in determining customer eligibility for financial 7
assistance specific to the Veolia Cares program and discuss the feasibility of modifying 8
those parameters in order to broaden the reach of the Company’s assistance program to 9
more customers. 10
Q. Does this conclude your rebuttal testimony? 11
A. Yes. 12