20241018Comments.pdf

RECEIVED
Friday, October 18, 2024 10.58.43 AM
IDAHO PUBLIC
UTILITIES COMMISSION
ADAM TRIPLETT
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 10221
Street Address for Express Mail:
11331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF INVESTIGATION )
INTO DRY CREEK WATER COMPANY, ) CASE NO. DRY-W-24-01
LLC, OWNER OF A WATER SUPPLY AND )
DISTRIBUTION SYSTEM )
COMMENTS OF THE
COMMISSION STAFF
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission, by and
through its Attorney of record, Adam Triplett, Deputy Attorney General, submits the following
comments.
BACKGROUND
Dry Creek Water Company, LLC ("Company"), is a water utility located north-west of
Boise. The Company owns and operates a water system that serves residents in the Dry Creek
Ranch development. The Company provides water to the Dry Creek Ranch Homeowners
Association("HOA")that in turn distributes water to the homes that have been constructed at
Dry Creek Ranch.
The Company is not regulated by the Idaho Public Utilities Commission("Commission")
and does not possess a Certificate of Public Convenience and Necessity ("CPCN"). Staff
STAFF COMMENTS 1 OCTOBER 18, 2024

believed that a formal investigation was necessary to review whether the Company is operating
as a public utility that should be regulated by the Commission.
PROCEDURAL BACKGROUND
In 2021, Staff received complaints from members of the HOA regarding increasing water
bills. While reviewing these complaints, Staff informally investigated the Company's
operational structure.
On November 17, 2022, Staff sent a letter to the Company requesting additional
information about its ownership and structure. Over the course of 16 months, Staff and
Company exchanged information and Staff reviewed the Company's financial information.
On April 11, 2024, Staff sent a letter to the Company stating that Staff may request the
Commission to open a formal docket to review whether the Company is subject to the
Commission's regulatory jurisdiction pursuant to Title 61 of Idaho Code.
On May 7, 2024, Staff filed a Decision Memorandum recommending the Commission
open an investigation and directing Staff to review whether the Commission should regulate the
Company.
On May 24, 2024, the Commission issued Order No. 36195, opening a docket directing
Staff to investigate whether the Company should be regulated by the Commission, set a public
comment date of June 12, 2024, and set a reply comment date of June 26, 2024.
On June 12, 2024, Staff filed comments recommending the Commission (1) find that the
Company is a water corporation operating as a public utility in Idaho; and (2) issue the Company
a CPCN.
On June 26, 2024, the Company filed preliminary reply comments whilst asking for
additional time.
On July 17, 2024, the Commission issued Order No. 36268, granting the Company
additional time to file additional supplementary comments by July 24, 2024.
On July 23, 2024, the Company filed a motion to amend Order No. 36268, to request a
60-day extension of its supplemental reply comment deadline.
On July 26, 2024, the Commission issued Order No. 36278, holding Order No. 36268 in
abeyance, allowing the Company until August 2, 2024, to file additional information in support
STAFF COMMENTS 2 OCTOBER 18, 2024

of its motion. The Commission vacated the July 24, 2024, reply comment deadline and reset it
for August 16, 2024.
On August 1, 2024, the Company filed a memorandum in support of motion to amend
Order No. 36268 and requested additional 60 days to file its supplemental reply comments, with
a check-in with Staff to occur within 30 days.
On August 20, 2024, the Commission issued Order No. 36292, granting Company's
request to amend Order No. 36268, set a reply comment deadline for September 22, 2024, and to
update Staff in writing on the status of its efforts to resolve this case no later than August 23,
2024.
On September 23, 2024, the Company and Staff(collectively"Parties") filed a Joint
Motion for Approval of Settlement("Settlement").
STAFF ANALYSIS
Staff believes the proposed Settlement is fair,just, and reasonable, and serves the public
interest, and therefore recommends the Commission approve it as filed. The Settlement lays out
that the Company will apply for a CPCN to operate as a public utility subject to regulation by the
Commission with regulation to begin on January 1, 2025. Regulation beginning on January 1,
2025, allows the Company additional time to restructure its existing water company, review the
various contracts it has in place, and update its billing processes to begin billing each connection
rather than the HOA. The HOA also needs to update its Covenants, Conditions, and Restrictions
and communicate any changes to the residents of the Dry Creek Ranch development.
Staff conducted an evaluation of the Company's current rates, which have been in effect
since 2023. Staff reviewed the rate structure, hookup fees, billing statements, the water operator
contract, legal expenses, management fees allocation method, inventory list, water right
documents, debt/loan documents, and infrastructure investment. Although Staff my recommend
specific adjustments to expenses in a general rate case, Staff believes the Company's current
rates are fair,just, and reasonable and allow the Company an opportunity to recover its prudently
incurred costs. The Company will not increase its rates for water service during the interim
period and will not do so without filing the appropriate rate application with the Commission.
STAFF COMMENTS 3 OCTOBER 18, 2024

STAFF RECOMMENDATION
Staff recommends the Commission approve the proposed Settlement, as filed, and order
the Company to submit a compliance filing by November 8, 2024, with formal regulation to
begin on January 1, 2025.
Respectfully submitted this 18th day of October 2024.
(A
Ad Triplett
Deputy Attorney General
Technical Staff: Travis Culbertson
I:\Utility\UMISC\COMMENTS\DRY-W-24-01 Comments..docx
STAFF COMMENTS 4 OCTOBER 18, 2024

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS DAY OF OCTOBER 2024,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. DRY-W-24-01, BY E-MAIL TO ALL PERSONS WITH A VALID E-MAIL ADDRESS
AND BY U.S. MAIL TO PARTIES WITHOUT A VALID E-MAIL ADDRESS, PER BELOW:
JAMES H HUNTER MGR JENNIFER REINHARDT-TESSMER
DRY CREEK WATER CO LLC ASHTON RUFF
923 S BRIDGEWAY PLACE KIRTON McCONKIE
EAGLE ID 83616 1100 W IDAHO ST STE 930
BOISE ID 83702
E-MAIL: itessmer cukmclaw.com
aru�,kmclaw.com
yaltig a,kmclaw.com
OLy:
PATRICIA JORDAN, ACRETARY
CERTIFICATE OF SERVICE