20240730Comments.pdf

RECEIVED
Tuesday, July 30, 2024
IDAHO PUBLIC
UTILITIES COMMISSION
Taylor R. Brooks, ISB # 11542
McConnell Wagner Sykes & Stacey PLLC
827 East Park Boulevard, Suite 201
Boise, Idaho 83712
[phone] Telephone
[phone] Fax
[e-mail]
Attorneys For Valiant Idaho, LLC
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
INVESTIGATION INTO Case No. GNR-W-24-01
VALIANT IDAHO, LLC AND
TIC UTILITIES, LLC, OWNERS OF A COMPANY COMMENT TO
NORTHERN IDAHO WATER SUPPLY ORDER NOS. 36149 AND 36254
AND DISTRIBUTION SYSTEM.
COMES NOW, Valiant Idaho, LLC ("Valiant"), by and through its attorneys of record,
McConnell Wagner Sykes& Stacey PLLC,pursuant to Rules 201-204 of the Idaho Public Utilities
Commission's Rules of Modified Procedure, IDAPA 31.01.01.201-204, Order No. 36149,
and Order No. 36254, and hereby submits its Company Reply Comments to the investigation into
Valiant's ownership of a northern Idaho water supply and distribution system opened by the
Idaho Public Utilities Commission("IPUC").
I.
BACKGROUND
On or about April 23, 2024, IPUC noticed an investigation into Valiant through Order
No. 36149 to determine whether Valiant operates a northern Idaho water supply and distribution
Case No. GNR-W-24-01
COMPANY COMMENTS
TO ORDER NO.36254- 1
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system and, if so, whether Valiant should be a public utility subject to IPUC regulation under
Title 61 of Idaho Code ("Investigation"). See also Idaho Code § 61-129. The Investigation stems
from Valiant's acquisition of a water supply and distribution system in and throughout
a community commonly referred to as "The Idaho Club" ("Idaho Club"). See Genesis Golf
Builders, Inc. v. Pend Oreille Bonner Development, LLC, et al., Case No. CV-2009-01810
(Idaho 1st Dist., April 2017); see also Valiant Idaho, LLC v. VP Incorporated, 164 Idaho 314,
429 P.3d 855 (2018); Valiant Idaho, LLC v. JV L.L.C., 164 Idaho 280, 429 P.3d 168 (2018).
In November of 2016, Valiant purchased the Idaho Club at a Sheriff's sale in
Bonner County, wherein it also acquired the Idaho Club's water system ("Water System"). Id.
Through two contentious years of litigation, many improvements and fixtures to real property,
and many capital contributions to the water system to render it operational, ownership and
authorization to operate that water system was granted to Valiant, subject to a preliminary
injunction entered in Genesis Golf Builders, supra. See Valiant's Response to Commission
Request No. 1. All relevant portions of the injunction related to the Idaho Club and/or Valiant
have been lifted or are no longer relevant.
In 2017,the IPUC began investigating the interests of Valiant, TIC Utilities,LLC ("TIC"),
and VP, Inc. ("VP") in the Idaho Club Water System. See GNR-W-17-01. However, much of this
matter was stayed due to the litigation ongoing in Genesis Golf Builders, Valiant Idaho v. VP, and
Valiant v. JVL.L.C., supra. Valiant would not have been able to comply with IPUC regulations
until the litigation over ownership of the Water System could be fully determined. In late 2022,
the First Judicial District Court in Bonner County granted Valiant enough authority to fully own
and operate the Water System, which it subsequently elected to sell to Gem State Water
Company, LLC ("Gem State"). See GSW-W-23-01.
Case No. GNR-W-24-01
COMPANY COMMENTS
TO ORDER NO.36254-2
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On December 9, 2022, Valiant entered into a contractual agreement to sell the
Water System to Gem State. See Case No. GSW-W-23-01. Valiant and Gem State subsequently
filed a joint application for a certificate of convenience and public necessity with IPUC. Id.
Even though that application was approved, Gem State terminated the contract with Valiant—
leaving Valiant with continued ownership and operational control of the Water System.
Subsequently, Valiant elected to (1) establish a water district for the Water System
pursuant to Idaho Code §§ 42-3201, et. seq.; or (2) sell the Water System to the Idaho Club
Homeowners Association, Inc. ("HOA"). Valiant decided not to pursue establishing a
water district. On June 25, 2024, members of the Idaho Club HOA met to discuss purchasing the
Water System. At the conclusion of the HOA meeting, Valiant decided that it was in the best
interests of the Idaho Club members and Valiant to abandon private sale of the Water System and
pursue a certificate of convenience and public necessity through the IPUC.
II.
COMPANY REPLY COMMENTS
On July 8, 2024, the IPUC issued Order No. 36254 noticing public comments
("Public Comments")and a schedule thereto for the IPUC's investigation into Valiant's ownership
and operation of the Water System. IPUC Staff published comments on July 18, 2024, and five
Public Comments were submitted by members of the public on July 15, 16, 17, 18, and 19, 2024,
respectively. Staff asserted that Valiant is likely a public utility and subject to IPUC regulation.
The Public Comments supported Staff s assertions.
Case No. GNR-W-24-01
COMPANY COMMENTS
TO ORDER NO.36254-3
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In reply, Valiant comments that it (1) agrees that the Water System is subject to IPUC
regulation under Idaho Code §§ 61-101, et. seq., and further agrees with Staff s recommendation
that the IPUC issue Valiant a CPCN to operate the Water System; and (2) intends to file an
application for certificate of convenience and public necessity under Idaho Code § 61-328
with IPUC.
DATED this 30th day of July 2024.
McConnell Wagner Sykes & Stacey PLLC
/s/ Taylor R. Brooks
By: Taylor R. Brooks, Attorneys For
Valiant Idaho, LLC
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on July 30, 2024, a true and correct copy of the foregoing
document was served via Electronic Mail upon the following party(ies):
Idaho Public Utilities Commission
Adam Triplett, Esq. [e-mail]
Idaho Deputies Attorney General
11331 West Chinden Boulevard [e-mail]
Building 8, Suite 201-A
Boise, Idaho 83714
lsl Pamela A. Lemieux
Pamela A. Lemieux, Legal Secretary
Case No. GNR-W-24-01
COMPANY COMMENTS
TO ORDER NO.36254-4
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