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HomeMy WebLinkAbout20220228Show Cause Hearing Transcript Vol I.pdfBEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE INVESTIGATION OE ATLANTA POWER COMPANY SERVICE AND CUSTOMER RELATIONS ) ) ) ) ) ) ) CASE NO. ATL-E-22-01 BEFORE COMMISSIONER ERIC ANDERSON (Presiding) COMMISSIONER JOHN CHATBURN r\a F-1 IT.l 't-tmn ruif\J fico ITt:Inl G\ -.i.1 I I .st] co i-ii ' PLACE:Commission Hearing Room 11331 West Chinden B1vd.Building 8, Sui-te 201-ABoise, Idaho 1., Ii," q n tn() DATE:February 23, 2022 VOLUMEI-Pagesl-43 CSB RBPORTING C e rt{ied S h o rt h and Rep o rterc Post Offrce Box9774 Boise,Idatro 83707 csbreportine@yahoo. com Ph: 208-890-5198 Fax: l-888-623-6899 Reporter: Constance Bucy, CSR ORIGINAL A P P E A R A N C E S. For the Staff:Taylor Brooks, Esg. Deputy Attorney GeneraL 11331 West Chinden BIvd.Building 8, Suite 201-ABoise, Idaho 83'120 For Atlanta Power Company: Xsrael Ray, Pro Ss 508 Auklet P1ace Fairbanks, Alaska 99709 CSB REPORTING 208 - 890.5198 APPEARANCES 1 2 3 4 5 6 7 8 9 10 11 L2 13 L4 15 16 t1 1B 19 20 2t 22 23 24 CSB REPORTING(208) 890-s1e8 INDEX WITNESS EXAMINATION BY PAGE Israel Ray(Atlanta Power) Mr. Brooks Commi-ssioner Anderson Mr, Brooks 4 5 37 Gene Haught(Atlanta Power) Mr. Brooks Commissioner AndersonMr. Brooks Commissioner Anderson Mr. Brooks 22 23 31" 33 34 25 INDEX 1 2 3 4 5 6 1 B 9 10 11 L2 13 t4 15 16 77 1B t9 20 2T 22 23 24 CSB REPORTING 208 .8 90 . 5198 I BOTSE, IDAHO, WEDNESDAY, FEBRUARY 23, 2022, 2:00 p. M afternoon. hearing in matter of COMMISS IONER ANDERSON : This is the time and Case No. ATL-E-22-01l again, good for a show cause referred to as the Once place also the investigation of Atl-anta Power Company service and customer rel-at j-ons. The purpose of this hearing is to al-low the Company to explain why the Commission should not, No. 7, declare all- fees and lnterest immediately due and lmpose penalt.ies; No. 2, open a new investigation j-nto whether the Company is providing safe and adequate service to its customers; No. 3, consider why a receiver or other similar relief should not be employed to operate the Company due to its continued fail-ure to comply with Idaho statutes and the Commission's regulatory authority to ensure the provision of safe and reliable service. My name j-s Eric Anderson. f '11 be the Chair of today's proceedings and to my left is Commissioner John Chatburn and to my right I yield to Commissioner John Hammond that would l-ike to make a statement. MR. HAMMOND: Thank you, Mr. President, Commissioner Chatburn. My name is John Hammond, the new25 COLLOQUY 1 2 3 4 5 6 7 I 9 10 11 t2 13 L4 15 t6 71 18 19 20 2L 22 23 24 CSB REPORTING 208.890.5198 2 compLaint. documents, f was Staff's Commissioner. Previ-ous to General representing Staff and a case involving Mary this, I was a Deputy Attorney and participated in this case Drake who had filed a attorney, helped prepare Staff in that matter, which has so in an abundance of caution, since I was in an adversarial- or abstain from passi-ng a Commissioner and step aside helped advise led to where we are I think it wouLd be to recuse today, best, myselfposition, j udgment and all-ow on this matter as you two to proceed forward. COMMISSIONER ANDERSON: Thank you, Hammond. I probably woul-d excuse you out to Thank you. A show cause Order was issued Commissioner the audience. by the Commission on January 24th, 2022. The Order stated three claims against the Company. This hearing is being held in order to al1ow the Company an opportunity to address the claims against it. The transcript of these proceedings wil-1 be added to the underlying record in the case. The Commissioners wil-l- revi-ew the f acts and the evidence in the record and make its final decision on this case. We do use a court reporter for these hearings. Today we have Connie Bucy creating an official- transcript of the record. Thank you, Connie. As an initia1 matter, 1et's document for the purposes of the25 COLLOQUY 1 2 3 4 5 6 7 B 9 10 11 L2 13 74 15 L6 L7 1B 1-9 20 2L 22 23 24 CSB REPORTING 208.890.5198 3 record the parties present and their counsel. We'11 begin with Staff representation. . BROOKS: ThankMR you, Mr. PresJ-dent, Taylor Brooks. I'm afel-1ow Commissioners, fry Deputy Attorney General represent Staff in this name 1s for the State of Idaho and I matter. COMM] SSIONER ANDERSON : Brooks, and for Atlanta Power. MR. RAY: Israel Ray. COMM] SS IONER ANDERSON : Ray. Do you Thank you, Mr. Mr. I'm just here Thank you, MR. RAY:representing myself, I guess, and Atlanta Power. COMMISSIONBR ANDERSON: So you have no counsel- here today? MR. RAY: No, sir. COMMISSIONER ANDERSON: Do you anticipate having any witnesses to call today? MR. RAY: Okay, Gene Haught, Atlanta Power and helps us. COMMISSIONER ANDERSON: Thank he works for Your Mr. Ray, and you anticipate THE W]TNESS: on testifying Yeah, I can. yourself, also? COMMISSIONER ANDERSON: I don't think there's any other counsel that I missed here. To25 COLLOQUY proceed, I'm going to go ahead and speak be too to testi-mony. When I call your name, be sworn there won't many names to cal-l-, you' 11 in and as you would in any other identifyofficial court proceeding, I wil-l- ask you to will include youryourself spelling for the record and name and address. Mr. Brooks will actually do those find that I've missedquestions. Unless my colleagues this hearing,anything covering not, we're going Iet me know now or, if to go . Ray, ahead and continue on. Mr I would like to call- you to the wit.ness stand for some questions, please. ISRAEL RAY, produced as a witness at the instance of the Atlanta Power Company, having been first duly sworn to tell- the truth, was examined and testified as follows: EXAMINATION BY MR. BROOKS: A Thank you, Mr. Ray. I would like to first ask that what you just did, the whole truth, the truth, did you take an oath to tel-1 and nothing but the truth? A o WelI, sure, yes. Thank you, and could you spell your first 1 2 3 4 5 6 1 8 9 10 1-1 L2 13 t4 15 L6 t1 18 L9 20 2t 22 23 24 CSB REPORTING 208 .8 90 . 5198 4 RAY Atlanta Power Company 25 and last name for the record, please? I-s-r-a-e-I, and then James middle is Ray. A Israel, name, and Ray. R-a-y O Thank you, and what is your affiliation with Atlanta Power Company? A Irve been president of it now know, 20 years or somethi-ng, since Stevenson O And can you please state your where you resj-de for the record? for, f donrt dled. address and A The address I'm usj-ng is 508 Aukl-et and then I'm retired, so Place, I helpEairbanks, Alaska, 997 09, my nephew, so sometimes I'm up at the ranch Oregon, and sometimes I'm down in Arizona at down there. They run cattle. MR. BROOKS: Okay, thank you. in Ironside, the ranch We have no further questions at this time, Commissioner, and f turn it over to you. COMMISSIONER ANDERSON: Thank you, Mr. Brooks. EXAMINATION BY COMMISSIONER ANDERSON: 0 this specific Thank you, to the five I'm going to keep that we asked of the Mr. Ray. questions 1 2 3 4 5 6 7 I 9 10 11 L2 13 L4 1_5 L6 77 1B 19 20 27 22 23 24 CSB REPORTING 208.890. s198 5 RAYAtlanta Power Company 25 Company A Yes. O And your written testimony 1s now part of this record. You do not have to read that. We have copies of that. We have gone through thatr so we're not going to reguest you to go through that and read that to us. V(e may have questions in regards to some of those things, but f want to go ahead and lead with just a quick statement to you, is that on May 10th, 2079, the Commj-ssj-on granted the Companyrs petition for reconsideration in Case ATL-E-18-01 based on the Company's desire to facilitate the sale of the Company's system, Order No. 34334. The Commission found the public interest may be served by such a sa1e. The Commission reasoned that imposing civil penalties cal-Ied for in the Order No. 34296 could impede the sal-e and negotiation. Because the Commission wi-shed to encourage the Company's efforts to sel-1 the system to a buyer who may be better served -- to better serve the customers, the Commission found j-t reasonable and in the public interest to at least temporarily suspend the Company's duty to pay the civil penalties. However, the Commission did caution the Company that it may revoke the suspension of the 1 2 3 4 5 6 1 I 9 10 11 L2 13 L4 15 L6 L7 18 L9 20 2t 22 23 24 CSB REPORTING 208 .8 90 . 5198 6 RAYAtl-anta Power Company 25 Company's payment obllgation if the Commission later found the Company had not obligated and complied with the terms outlined in Order No. 34334, and my question, f'm going to move here to the No. 5 question that I want to ask you, first of all, you were i-n negotiations with the Atlanta Association, Efectrj-c Cooperative Association, and my questi-on to you 1s when did you end those negotiations ? A Well, Irm not posj-tive that they ended. We talked to John Howard, he owns the Beaver Lodge up there, somewhere during that "You guys need to" see, I f have deeded back and forth acres of ground that f bought because they were telling me off of there if I didn't want and I told John, I says, have i-t's been said that up there. I have about five from the Stevensonrs estate to get Atlanta Power stuff to buy it. I bought j-t. I is a l-ittle chunk in thebought the middle of put there give me an curtailed, five acres. There it that Atlanta Power has always had and it was to Mr. Ray, this is specific Too long? The answer specifically that I'm looking o A o for is if you are no longer in negotiations or if you can when those negotiations were the question. I don't need to know the idea of thatrs 1 2 3 4 5 6 1 I 9 10 t- 1_ L2 13 1,4 15 t_6 L7 18 19 20 2L 22 23 24 CSB REPORTTNG 208.890.5198 1 RAYAt1anta Power Company 25 history of asked him, I generator and John Howard, says, "If I don't own all that stuff on my "You guys need to it to, " and that it, I donrt r just want the property," and I told Let me know where you're was in the sprj-ng and was nothing curtail-ed. the land purchase. A Okay, they werenft curtailed. gor_ng that's to move the last I know. There It's just nobody has got back to me. O So they've never even at one time addressed the question of further conversatj-on with you? A No, no. Someone suggested that I should move it I heard through the grapevine. It wasn't direct conversation to me, but f'm not doing that. Itrs something that the co-op would have to do and the l-and is mine. I didn't deed nothing back and forth like these accusations that are going on. I bought it at a sale for $26,000 from the Stevenson's estate at an auction. O Thank you, Mr. Ray. The reason I'm asking these questions is because the Commission dld temporarily suspend the fines that we had on you and there were certain criteria under Order No. 34334 that you were to abide by and follow for those to remain in that status of temporarily suspended. A Yes. 1 2 3 4 5 6 7 I 9 10 11 t2 13 L4 t5 76 L1 18 19 20 2L 22 23 24 CSB REPORTING 208.890.5198 B RAYAtlanta Power Company 25 O And the Order specifically said if at any time Staff perceives sale negotiations are not progressing or are in good faith or that Atl-anta Power is not responding to reasonable requests for information or there is no indication of progress toward the sal-e of the Company's assets, our attention for then Staff should bring these issues to our consideration in reinstating the Company's obligation to pay the 12,000 1n existlng penalties and the $2,000 per day in additional penalties as specified above, and so my question is did you make any efforts yourself to continue the negotiations since spring? A Yeah, that's yes, I did, that board. He and so I because see, works for me,Gene Haught is but he's on the forth with Gene some different actually on new board and f says, "Wel1, options, " and they was talking we need to were talking the dam, back and figure about thatrs out moving it down to the dam, but down at right next to my reservoir. Putting a generator that close wil-l- probably be yeah, w€ were talking, but it's not their obligatlon t.o figure out a place mine. diesel tank and a impossible, but that's if it's to put it, not difference of opinion on the the Company was directed to O Itmaybea proper obligation, because 1 2 3 4 5 6 7 8 9 t_0 11 t2 13 l4 15 L6 t7 1B 19 20 2t 22 23 24 CSB REPORTTNG 208.890. s198 9 RAY Atlanta Power Company 25 negotiate, so yourre aware of that? A Yeah, I understand that, but I don't know where to put it. O Very good, so the first question, then, is about whether to impose the penalties and then whether or not we should impose additional penalties, and apparently, through the investigation of Staff, there's been findlngs in their attachments that there's stil1 many obligations, including the payment of your gross interstate operati-ve revenues on a timely fashion. You failed on those and can you address your concerns with additional fines? A negotiating, I sitting there. living in Arizona died. I'm being WeII, and then I Well, the first group if we are still think it would still- be moot. That's just The second group, this spring I was COVTD and I almostand literally I got honest. I was in bad, bad trouble. thought weI1, I want to come I was up and was to Atlanta and deal- with this stuff. I had an abscess the size of a wanting to come I got to Boise baseball and I and I coul-dn't back in Atlanta nephew's ranch better, so what go. r with and in a couple of months I'm getting at is I have went to my I was doing tri-ed to make an getting IVrs and shots of antibiotics went to f couldn't be 60 miles those issues, so I 1 2 3 4 5 6 7 I 9 10 11 L2 13 l4 15 1,6 t1 1B 19 20 2! 22 23 24 CSB REPORTING 208.890. s198 RAY Atlanta Power Company 25 10 effort, but things just didn't sometimes they don't work. O And I think the failure there is not necessarily your health, and I apologize that you were going through those hard times, however, we are limited to the number of people we can contact or your members or your customers can contact, also, and we've issued four different summonses ourselves as a Commission, and, you know, you have obligations through your ownership of this Company to respond to those things, and when you don't over months, not just the two months that you may have been sick but over months and periods of time, so we do have to take action and consider what the process should l.r a A Yeah. O f 'm going to fines for the moment and I'm move away from the pending and that I s where you answered going to go to j-tem No. 2 the question of whether an not the Company isinvestigation into whether or providj-ng really -- you in safe and adequate servj-ce to its customers, you you basically said whatever we want to do, but brought up the fact that that statement. I'm not you may have new purchasers quite sure what that has to do with an investigation A WelI, the that we shoul-d do or not. new purchasers are Nick back 1 2 3 4 5 6 1 I 9 10 11 13 t4 15 16 l1 18 19 20 21 22 23 12 24 CSB REPORTING 208 .8 90 . 5198 RAYAtlanta Power Company 25 11 1 2 3 4 5 6 7 I 9 there and he's a lineman and he's been helping us and so that's why I brought it up is we've been see, the problem with this is I know I am a -- werre a utillty and stuff, but when Dave GilI went to South America, if I -- I'm supposed to do a l-ot of things, but a l-ineman is $130,000 a year. We got Nick has been helping us and with Gene Haughtr we've been doing repairs and doing more and fixing some of those problems. I named them there and Gene can telI you more about what problems we fixed, so thaL's how it is, is the purchaser is also -- wel1, he's head of the l-lneman college out here at Northwest Lineman Schoo1 in Meridian, so he's very competent, so I guess that's how it ties together. O I appreciate that , if thatrs your answer to the invest.igation question. There are a lot of issues, safety issues, sti11 that are existing there and it would seem to me that if you have the opportunity to have an investigation that would help perform you to operate a better business, you would take advantage of that and not try to think that new owners are simply going to solve the problems because they need to be identified. A That's why I said if you want to. I didn't say no, don't do it. I have no issue with any help that Irve ever gotten from the Public Utilities CSB REPORTING 208 .8 90 . 5198 10 11 t2 13 74 15 t6 77 18 19 20 27 22 23 24 RAY Atl-anta Power Company 25 t2 Commission, because therers been a l-ot of help and Terri wil-l tell- you. I come to her and I ask for help and she helps me O Eor we were notified of this month and here of this has been the record, Mr. R"y, the new owners potentially we are on the 23rd, so going on for many -- Nick was doing alJ- this new owners, on the 17th of it's not a lot A No, don't know, a year or two now. See, he's been helping us and he finally said weIl a conversation got brought stuff for, I you don't just go ask people if or do something, but Nick said Gene Haught, he sai-d, "Do you to help him more with the up, do you knew about You know, something effect to think Israel- woul-d and this is the first I it. they want to something to think Israel- Company? " wou]d want us buy the And I went, "Oh, weII, yeah, " and they came to me even. They come to me and said, "We'd }ike to help you and here's what we would l-j-ke to do. Are you interested? " And I looked at that and I said, "Yeah, sure, that will work," so that's the way it happened. O And you have an intent to purchase from them -- A Yes. 1 2 3 4 5 6 7 o 9 10 11 t2 1_3 T4 15 16 1,1 18 79 20 2L 22 23 24 CSB REPORTING 208.890.51-98 RAYAtlanta Power Company 25 13 signed by all And we wanted to just messing around, that that ir. purchase, your time your time would -- parties ? show you that we werenft will work and we can do O A O Well, that intent is not a contract to though, and would you anticipate -- what would frame if we were to consider that, what is frame for a contract to be developed that A It wouldn't It woul-dbe messing around. of time.be in a good decent O And idea? A something, not amount don't l-ike tomorrow or I mean, give me an No, I don't know. A couple of months or you know, you've got to have do things tomorrow. They have to look atattorneys it and put a fair contract, sotogether Bohner and me to guess that, back and forthwhen Tony when the times. He told me, times I've'r -- he's us were negotiati-ng dams failed, Tony sent our contract back 18 "That's the my Iife, " so good faith, a he said, "Israel, thatrs the most Bohner Chasan & Walton and he said, back inmost times I've ever sent a contract hopefully, you know, Lf people negotiate in things can get done in decent order. And I coul-dn't agree more, however, but we 1 2 3 4 5 6 1 I 9 10 11 t2 13 t4 15 t6 77 18 t9 20 21 22 23 24 CSB REPORTING 208.890.5198 RAY Atlanta Power Company 25 74 donrt have a negotiations A and stuff, I history of that have developed I showed that here. We have some The results knew that. a lot of that through good faith. you of the appraisal wasntt accurate; not $2oo, oo0 at about 70,000. It was $140,000 o Well, from what I've read is that you guys did negotiate on an appraiser and you agreed upon a person. A But on my farm whenever I get an appraisal, the guy says, "Okay, these tractors are worth this, this is worth this." AII that appraisal consisted of was, "We11, Linda says there's about 50,000 a year coming in. Take 10 times that, thatfs 500,000. Then you take a couple hundred thousand off for repairs and you get 300,000," but it did not include any of our accounts receivable by the way, so -- but whose fault was that? I don't know, but when I was doing these gross operating reports, I went, "Wel1, why are we talking 50,000 here and then why are we showing 70 or 80?" And this year our operating is 84,000. I did turn that in and I'm going to file it today by the way. O The appraisal? A No, oo, with Terri Carlock. What do you to fix the lines when in reality j-t's coming in You know, there's that's reality. off of that one item. I 2 3 4 5 6 1 8 9 10 11 L2 13 1-4 l_5 L6 77 18 L9 20 27 22 23 24 CSB REPORTING 208.890.5198 RAY Atl-anta Power Company 25 15 call it? The gross operating revenue report; right, Terri? O I'm qoing to questions, Mr. Ray. A I'm sorry, I 0 Right, so do in that tentative contract Mr. Haught and Johnes, you've rate and value, is that stil-l on the 17th. Is that still- an numbers that you gave us? A Yeah, it does. go ahead and ask the just forget things. I. You have mentioned that that you want to prepare with come Lo terms with time and firm? That was just signed agreement with those The reason I turned that j-n and this is for your I turned it in because talking about is annuaf revenue. accountants. We table, but aside, we consideration because we're talking 84,000, you guys not these different numbers, and I'd like for the Commission to look at that, because what Gene and Ni-ck and us are a term that would justify 36,000 in You know, we're just -- werre not were just negotiating, you know, at a there's some issues there, but that being set j ustcan come up with a good number. I'm trying to I'm just trying to get some revenue for the next 15 years. I'11 be 7B when it's done and I'm wiIli-ng to carry it by the way. Irm carrying it for the Company once more. I 2 3 4 5 6 7 I 9 10 11 L2 1_3 L4 15 16 77 1B L9 20 27 22 23 24 CSB REPORTING 208.890. s198 RAYAtlanta Power Company 25 L6 O I don't want to be 78 when this is done, though. See, thatfs the problem I have. A We're not talking done. We're talking when I get my payments. O Well, okay, I understand, but in your written testimony, though, it conflicts with what your agreement is, because in your written testimony, you talk about the $365,000 of purchase, but then you sdy, "which 1s far bel-ow the final numbers on the appraj-sa1" A Yes, it is. O "which still needs to be put together, " so are you arguing with the agreement you've submitted into the record, that you already submitted? A No, f'm not arguing. Irm just showing that even though the appraisal is higher, I'm accepting that number. O Okay, let the record show that. Okay, we're going to move on from the investigation. The Commission will determine that in their Order. The next question that was delivered to you was appoint a receiver or similar relief,it shou]d not be employed to fail-ure tooperate the comply with regulatory authority to ensure the rel-iable servj-ce, and your comment why dueCompany to its continued Idaho statutes and the Commission I s provisions of safe and is that just because 1 2 3 4 5 6 7 I 9 10 11 L2 13 L4 15 t6 t7 t_B 19 20 2L 22 23 24 CSB REPORTING 208 .8 90 . 5198 RAY Atlanta Power Company 25 l1 of the ongoing saler w€ shouldn't have to do that. A Wel-I, that answers the issues of safe and reliable power. They're helping to -- Nick knows what he's doing. He's helping us to take care of that part, yes, that's what I meant. O Okay, and the is further ordered that the information on how customers next item that we had was it Company should shall provide contact contact the Company hearing, which youon services issued at the show cause have provided that in writing. A Yes. O Howeverr orr your address i-n Fairbanks, oftentimes nobody ever gets a response and oftentimes when people do call-, there's a recordj-ng that does not allow any more messages. The recording box is always fi-11ed up, so have you tried to remedy those issues? A Wel-I, that's why I put my email in there and that's why I put Sara's number in there. Some places I stay, l-ike up at if you're within a I put Sara's number something if you says, "Dad, you've that's not a and Nobody had that. I the ranch, we only have cel1 service hundred or 200 yards of the house, so and Sarah knows where Irm at and if guys or anybody contacts me and Sara got to get back I put my email didnrt realize here, I address that, so call-. " I know by the way. now I 1 2 3 4 5 6 7 I 9 10 11 72 13 74 15 t6 L1 1B 19 20 2L 22 23 24 CSB REPORT]NG 208 .8 90 . 5198 RAY Atlanta Power Company 25 18 wouldnrt have an excuse. You email me and fet'srr *- and I put it there for everybody call me or not call me, email and I will-. MR. BROOKS: Mr. President, clarifying question regarding that piece of COMMISSIONER ANDERSON: Yes. sdy, "Israe1, in this room, if I may ask a testimony. MR. BROOKS: you please identify who Sara THE WITNESS: MR. BROOKS: THE WITNESS: MR. BROOKS: the record, please? THE WITNESS: MR. BROOKS: Thank you. Mr. Ray, could is for the record? My daughter. And what is her last name? Sarah True. And could you spell that for T-r-u-e. Could you spel1 her first and last name for the record, please? THE WITNESS: S-a-r-a T-r-u-e. I didn't do it wrong, did I, Matt? Sara will have me MR. BROOKS: And where does Sara reside? THE WITNESS: 32L South Cotterell. You've got that, don't you? ft's j-n Boise here. Itrs right down f rom the mal-l-. MR. BROOKS: Thank you. A BY COMMISSIONER ANDERSON: Thank you, Mr. Brooks. Many of these issues we're trying to 1 2 3 4 5 6 1 8 9 10 11 1,2 13 L4 15 76 t1 18 19 20 2t 22 23 24 CSB REPORTING 208.890. s198 RAYAtlanta Power Company 25 79 address, Mr. Ray, j-s to try to determine whether or not these fines will be rei-mposed or we add additj-onal fines to this problem, so it's important that we have good dj-rection from you that this is going to proceed, and since you now have a new contract, one of the questions that you were to address is that are you still in negotiations with the AECC and it doesn't sound l-ike you are if you have a new contract. A We1l, yes, that would be accurate, yes. O Thank you. That answers that one. The other the next item I I 1l- go to is it is further ordered that the Company shal-I provide copies of any appraisal, which we discussed earlier, and you do not have a written copy of the appraisal? A No, not with me. Maybe it's in I donrt know. I'l-l- just say f don't know where it's at right now, because I didn't know I was going to have to come up with it. Irm here, not in Alaska, but real si-mpIe like I was discussing. O Mr. Ray, the question, the appraisal 1s though, that was asked of you copy of the A a A and it was required of you is to bring a appraisal Yes. to the show cause hearing. I can't find it. 1 2 3 4 5 6 1 I 9 10 11 72 13 L4 15 16 L7 18 19 20 2L 22 23 24 CSB REPORTING 208.890.5198 RAY Atlanta Power Company 25 20 O Okay, so thatrs the answer, then? A Yeah. O V[el]-, the next question, Mr. Ray, and itrs I'11 just read the question. "The Commi-ssion directs the Company to provide the Commission with a response at the Show Cause Hearing to explain how it will address the numerous issues with the Company's service reliability and system as set forth in Staffrs report, dated December 28th, 2018, and attached hereto as Attachment A, including, but not limited to, those parts of the Companyrs system discussed in the findingsr" and in your statement here, you have said that you would l-ike to have Gene respond to those things. A Yes. COMMISSIONER ANDERSON : and dismiss and we may swear back witness. from the witness you back and we I'm going to box there for wonrt require go ahead a moment you to asa you call in and i-f we could cal-l Gene Haught (The witness left the stand. ) 1 2 3 4 5 6 7 8 9 10 11 L2 13 'l-4 15 L6 1,7 18 t9 20 2'1, 22 23 24 CSB REPORTING 208.890.5198 RAYAtlanta Power Company 25 27 GENE HAUGHT, produced as a witness at the instance of the Atlanta Power Company, having been first duly sworn to tel1 the truth, was examined and testj-f ied as foll-ows: EXAMINATION BY MR. BROOKS: A Thank state your first and record, please? your Mr. last name Haught, could you please for theand spe11 it A A-r-n-o-1-d, o A 83716. o My proper name is Arnold Eugene Haught, Eugene, E-u-g-e-n-e, Haught, H-a-u-g-h-t. Where do you reside? 235 West Yuba Vista Drive, Atlanta, ldaho, And what is your affiliation with Atlanta Power Company? A Itm managex, I guess. MR. BROOKS: We have no further questions at this time. COMMISSIONER ANDERSON: Thank your Mr. Brooks. 1 2 3 4 5 6 7 B 9 10 L2 13 74 11 15 16 1-7 18 19 20 2t 22 23 24 CSB REPORTING 208.890.5198 HAUGHTAtlanta Power Company 25 22 EXAMINATION BY COMMISSIONER ANDERSON: O I understand you're a f iref ighter, fj-re captain. Fire chief. I was a fj-re chief, a1so, so we have that l-n common. A Yes, sir O Years ago back when I was a littIe more spry. Wel-come . A o A o all, I'm just negotiations property with A o A Thank you, sir. f appreciate it going to confirm and Mr. Haught, fj-rst of that you have been in with Mr. Ray on the purchase of this you and Mr. Johnes? That's correct. Is it Johnes or .Tohnes? Johnes. a Johnes, thank you, and you are continuing those negotiations, but you antj-cipate A I thought we were done. O You thought you were done, okay. Do you anticipate that you could finalize that agreement within 30 days or what do you anticipate if -- 1 2 3 4 5 6 7 8 9 10 11 L2 13 1,4 15 t6 L7 18 19 20 2L 22 23 24 CSB REPORTING 2A8.890.5198 HAUGHTAtlanta Power Company 25 23 A I would l-ike to be able to have it finalized by the first of April, but agaj-n, as Mr. Ray explained, I can't speak for how long it's going to take attorneys to get it done. 0 Right, but you would like to see this move forward quickly? A Yes, sir. O Thank you, that's what I wanted to know. Let's go through a few things that the Commission did ask that you've been taking care of the system. Are you a certified Cat repai-rman, also? A No, sir. O We11, 1et's just go with the first item that we have. I wanted to ask about the low hanging service lines. A That was taken care of . The 1j-ne you're speaking agar-n, so here that of was taken care of four years ago. 0 Okay, apparently, it was complained about we did not know that. It was part of our list we have. A I think in that complaint that you got again, it was just in that complalnt. I don't know that I ever addressed that with the individual- that filed the complaint that we had taken care of that, and it is al-so in our five-year plan that that whole area in there is 1 2 3 4 5 6 1 I 9 10 11 t2 13 L4 1_5 16 1-7 18 19 20 21- 22 23 24 CSB REPORTING 208 .890.5198 HAUGHTAtlanta Power Company 25 24 going to be replaced. O So thatts aI1 lines and poles? A Yes, sir. O So the next question I have was the poles that are rotted at base and leaning, you're A We're already in the process of replacing those. O And did Staff work with you to the poles and transformers that were in need identify of repair? A Staff? 0 Yeah, our Staff. A No, sir. O Our Staff did not? A No, sir. 0 One thing that. our Staff did identify was that we did have antiquated transformers and leaky transformers and some of those I bel,ieve are old or probably have PCB issues. A As far as Irve been able to determine, none of our transformers, the ones that are the ol-der ones, t.hey're pre-PCB, but I have since gotten test kits and will be testing any transformer we take down, because the company that we're buylng transformers from will- t.ake the ol-d transformers as long as we've tested the oil. O Okay, and do you have a stockpile of 1 ) 3 4 5 6 1 8 9 10 11 L2 13 t4 15 t6 1-7 18 t9 20 2t 22 23 24 CSB REPORTING 208.890. s198 HAUGHT Atlanta Power Company 25 25 those, because have you ordered the transformers already? A the system? A In the have that information, A Thatrs V'le have some on the wdy, yes. How many transformers do you have total ina system tota1, but I can get okay. The anything Irm sorry, I dontt it for you. question was they're is hard to 9et, likehard to get transformers A o right now, delivered. I I just ordered some. saw that Mr.Ray mentioned in he got some last his writing, in his answer, that guess my question is if you long have you had additlonal you just now order them? wetve week, and I have these identified, how transformers on-site or did A No, we used up what we already had, so been replacing transformers. o supported by a rooflines? A 0 A hanging wire A11 right, your service drops to meters piece of wood above the customers' That is that same wire. The same which? The wire you were talking about, the low 1 2 3 4 5 6 7 I 9 10 11 72 13 t4 15 76 77 18 79 20 21, 22 23 24 CSB REPORTING 208 .8 90 . 5198 HAUGHTAtlanta Power Company 25 26 o A Thank you. that's the same one. O And the spij-lway were inoperable and the control the reservoir was indeterminate. A We1l, I read that gates that control the fl-ow into and wel-Ir we don't have our pond. I guess where people in the fall- when we do stakes gates, it and flow says that they of water into Right. We only have gates that control water exiting the pond. 0 Correct. A They're operable. think that they're not is because our fall- cleanJ-ngr we take metal and prop the have to run agates up for the winter so that we don't all winter Iong, because we're not putting the in the winter. They never go down, so there's o A compressor gates down no reason that compressor will- allow the to run and there are leaks in gates to go down if wethe bladders that conserve so we put turn the on power sticks didnrt run the compressor all winter, tear on so we I re trying to and wear and that compressor, up, and thenunder the gates, prop them so that we don't wear it out. had just recently purchased a new compressor off O And you compressor? 1 2 3 4 5 6 1 I 9 10 11 L2 13 L4 15 16 L7 18 L9 20 2T 22 23 24 CSB REPORTING 208.890. 5198 HAUGHTAtlanta Power Company 25 21 A Yes, sir. We just spent about $4,000. O Very good. Going back to the question of appraisals that Mr. Ray and I had discussed, have you anticipated doing an appraisal through your purchase or are you -- because it sounds l-ike there's going to be a fi-nancing through Mr. Ray. He's going to actually finance this through an agreement. A Yes, sir. O However, I think Mr. Johnes or one of you folks identified a $70,000 improvement that's going to be needed relatively soon. A That's part of our five-year pIan, yes, sir. appralsal you need to cash. a So my question, I guess, wouJ-d be an is probably still an important thing to have if to go borrow money, unl-ess you have the access A We do. O And you do? A Yes, s j-r. O Okay, and just for the record, Mr. Haught, if there was going to be a purchase, that would have to be a separate filing outside of this case that we're in now and that would be the responsibility, I believe, of the purchaser to file that, so just so you're aware of I 2 3 4 5 6 7 I 9 10 11 1,2 l-3 14 15 L6 71 18 t_9 20 27 22 23 24 CSB REPORTING 208 .890. 5198 HAUGHTAtlanta Power Company 25 2B 1 2 3 4 5 6 1 8 9 that. If you continue to move forward with that desire, then you need to file with the Commission that purchase agreement. A Yes, sir, we're planning that and we tal-ked to your Staff about that. We were at this point part of the issue with not being able to give you an exact date when that contract could be signed was we wanted to -- we didn't want to spend a whol-e bunch of money on lawyers if you were going to just say no, you're not doing that, so we're hopeful that you're going to give us a go-ahead soon so that we can get these lawyers moving quickly to get thj-s contract done. O And I'm only one-third of the discussion, so there's still parts of my braj-n I have to deal with, too. A Yes, sir. O All- right, the last item, and this is a question, I noticed in the contract you're talking about a $90 a month .Iease agreement, too, j-s that for the propane not the propane, the diesel tanks? A No, sir. Itrs not only the dj-ese1 tanks, it's al-so where all the equipment is stored on Mr. Ray's property. a So that would resolve the issue of long-term leasing? You woufdn't have to go buy new l-and CSB REPORTING 208.890.5198 10 11 t2 13 L4 1-5 L6 L7 18 19 20 2t 22 23 24 HAUGHT Atl-anta Power Company 25 29 or put it down by the dam? A That's correct. 0 That's don't think you would AOh,r get a permit. O Right, encouraging to know, because I get a permit for know for a fact yourre not going to filters, that kind of thing. The Cat up was because we werenrt able right. How dif f icul-t is it to get a Cat certification for maintenance? It sounds like you you bringguys spend a considerabl-e amount of money when those maintenance men up from Caterpillar. can do the baslc maintenance,A We1l, w€ changing oils, changing reason we had to bring have them come un.l-ess I wanted to to diagnose the problem in do that, and the computer and we had to school for generation, them come and do that which I do not, we had go to Cat to have and then they found a faulty voltage regulator. COMMISSIONER ANDERSON: Well-r we basically -- the questions that were submitted to the Company, the answers have been in writing and werve heard public testimony and answers to those same questions. Do you have any questions of the witness? MR. BROOKS: Yes, Mr. President. We have just a couple of clarifying questions. 1 2 3 4 5 6 7 8 9 10 11 t2 13 t4 15 1,6 l7 18 L9 20 27 22 23 24 CSB REPORTING 208 .8 90 . 5198 HAUGHT Atlanta Power Company 25 30 COMMISSIONER ANDERSON: Certainly. FURTHER EXAMINATION BY MR. BROOKS: O Mr. Haught, have you seen the Staff report from the Commission Staff that was drafted in 2018 that detail-ed a l-ot of the issues that were filed in the compJ-aint in the original case? A Yes, sir. O And have most of those issues within that Staff report been addressed, to the best of your knowledge? A Not all, but we're working towards them. The safety issuesr we have a young man coming up to give us a bid on that and/or even to start work on this summer to address the safety issues at the hydro building and at the water intake. O To the best of your knowledge, are those the only issues that remaln to be addressed or could you identify specifically what other issues have not been addressed that sti1l need to be addressed for the Commission? A There's a lot of poles that still- need to be replaced and l-ines that need to be upgraded and we're 1 2 3 4 5 6 7 I 9 10 11 72 13 L4 15 1-6 77 18 19 20 2L 22 23 24 CSB REPORTING 208.890.5198 HAUGHT Atlanta Power Company 25 31 working on that. We replaced some lines sunrmer. We already are in the planning replacing some lines on Pine Street and we are waiting to talk to because it's going to be approval to cut trees, so to get those trees down. the landowner this last stages of transformers and to be able to a new 1ine, he has to give us we're in negotiations with him do you or all- there trying whj-ch are antiquated on one transformer, and old get all the o1d copper 0 And upon your best estj-mate, when expect to complete the majority of those repairs of those repairs? A We have a five-year plan to get 80 percent. There may be some oddbal-I poles here or that we don't get to in the five years, but we're to address the trans formers, copper lines. fines out of maln concerns, too many houses We're trying to the system. And so is it and Mr. Johnes, to support the today? Along with o between you wherewithal speaking of A yes - your testimony today that you have the financj-al five-year plan that you're the income from the system, MR. BROOKS: We have no further guestions, Commissioner. 1 2 3 4 5 5 1 8 9 10 t-1 L2 13 L4 t-5 L6 L1 18 19 20 2L 22 23 24 CSB REPORTING 208 .8 90 . 5198 HAUGHTAtlanta Power Company 25 32 COMMISSIONER ANDERSON: Thank you, Mr. Brooks. FURTHER EXAMINATION BY COMM]SSIONER ANDERSON: 0 Mr. Haught, you were also a member of the potential co-op board at one time? A Yes, s j-r. O Is it your understanding that -- we did get a letter today from the attorney that represented that giving detaj-led informati-on why we shoul-dn't believe anything we hear, but are you do you antici-pate that they have any interest in continuing forward with the purchase? A I'm sure they have j-nterest. f have a personal opinion. I don't have facts, but I have a personal opinion, but Irm sure they're wanting to move forward. Why it's taken so long, I can't answer you. O Okay, and just so you're aware, if you and Mr. Johnes contj-nue forward with your purchase, you do realize it would be still be cl-assified as an independently-owned utility that would be regulated by the PUC? A And that's what we wanted. 1 2 3 4 5 6 7 I 9 10 11 t2 13 L4 15 L6 L1 18 79 20 21 22 23 24 CSB REPORTING 208.890.5198 HAUGHTAtlanta Power Company 25 33 COMMISSIONER ANDERSON : this seems quick, but we only had so Very good. I know many questions and answered. I'm going to do for any questions? Not Mr. Ray. I have one last so many ways you need to to have them cross Mr. Ray MR. BROOKS: clarifying question for Mr. Haught. COMMISSIONER ANDERSON :Please. FURTHER EXAMINATION BY MR. BROOKS: O Could you teII the Commission about when you started workj-ng for Atlanta Power Company as its manager and when you started upgrading the system? A I started taking care of the system whil-e Mr. Ray was si-ck. I think t.hat was in'18 and I finally got to speak to Mr. Ray directly, because his brother was kind of in the way for a littl-e while about a year-and-a-ha1f later, and once I was able to speak to Mr. Ray directly, he essential-ly told me he wanted me to just take care of the system. O And is it your opinion that after completing the five-year plan that Atlanta Power Company will- have safe and reliable service for the most part, give or take the oddball things that you mentioned 1 2 3 4 5 6 7 I 9 t_0 11 L2 13 L4 15 16 L7 18 19 20 2L 22 23 24 CSB REPORTING 208 .8 90 . 5198 HAUGHT Atl-anta Power Company 25 34 direct or to redirect to Mr. MR. RAY: The earlier? A Yes, sir. I think we'l-I be in far better shape than we are now, yes. MR. BROOKS: Thank you very much. No further questi-ons. COMMISSIONER ANDERSON :Thank you, Mr. Haught, and Mr. Ray, do you have Haught? diesel any questions to tank, thatrs Atlanta Power's. The only thing we're talking about them renting and we wou.l-d -- I woul-d want a year-to-year lease, because it's my property, is the property there where the generator sits and so that's I'm just clarifying that. Someone said the diesel tank, is that what they're diesel generator and tank are Atlantarenting. Power's. No, the They don't have to rent them from me. COMMISSIONER ANDERSON: Thank you. Yourre just renting the land? MR. RAY: I own the 1and. COMMISSIONER ANDERSON: So you're renting it to them? MR. RAY: But Ird like that to be on a year-to-year basis because COMMISSIONER ANDERSON: Thank you. MR. RAY: it's my land. 1 2 3 4 5 6 1 I 9 10 11 72 13 L4 15 t-6 L1 l-B 19 20 2t 22 23 24 CSB REPORTING 208.890.5198 HAUGHTAtlanta Power Company 25 35 1 Z 3 4 5 6 7 I 9 COMMISSIONER ANDERSON: WeIl, it's important that we have this information, because these fj-nes are pending and unless we have a satisfaction as a Commission as a wholer we wiLl deliberate on this privately and we will determine what we believe to be a true and correct course forward. Health and safety of your customers is vitally important to us and we want to make sure that al-l- the dots are being dotted and all- the T's are being crossed, so that's part of the thing. We'll go ahead and excuse you, Mr. Haught. Thank you very much. THE WITNESS: Yes, sir. (The witness left the stand. ) COMMISSIONER ANDERSON: Counsel, do you have any other witnesses? MR. BROOKS : Mr . Pres j-dent, we ' d li ke to call Mr. Ray back to the stand for a couple of clarifying questions regarding the financing. COMMISSIONER ANDERSON: Thank you, Mr. Ray, and you've already been sworn in. MR. BROOKS: If itrs okay with you, I'1I go ahead and re-swear the witness in just so we have the affirmation of both on the record. COMMISSIONER ANDERSON: Okay, thatrs fine. CSB REPORTING 208.890.5198 10 11 1,2 13 !4 15 16 t1 18 19 20 21 22 23 24 HAUGHT Atlanta Power Company 25 35 ISRAEL RAY, produced as a witness at the instance of the Atlanta Power Company, having been first duly sworn to tell the truth, was further examined and testified as follows: FURTHER EXAMINATION BY MR. BROOKS: purchase tel-l- the default O Regarding you carrying the note for the by Mr. Haught and Mr. Johnes, can you please Commission what would happen if there were a on the loan? If Mr to default on the note that Haught and Mr. Johnes were you are leasing to them, what would be your position then? A Wel1, I asked Terri Carlock about that. When we used to borrow money from Eric Alburde [phonetic], we did a l-ock box agreement, but I don't know without asking an attorney how to secure it, but just from what f know about Nlck Johnes, I donrt think thatrs an issue. I don't think he wou]d ever l-et it fail-. I've been toId, you know I've been told I know he's got a l-ittle extra money, okay. O So is it your testimony a defaul,t that you do not have a plan for A I'm tel-l-ing you we'Il get one if an the event of on the note? 1 2 3 4 5 6 1 B 9 10 11 L2 13 L4 15 1_6 L7 t_8 19 20 2L 22 23 24 CSB REPORTING 208.890.sr_98 RAYAtlanta Power Company 25 31 attorney will teII me how to do it. O Okay, thank you, and what with Mr. Haught or Mr. A Liability meaning what? O In the event that Mr. Haught or Mr. Johnes is injured and, therefore, incapacitated to continue working and maintaining Atl-anta Power, do you have a plan j-n place for a workers' compensation plan, any type of j-nsurance with you carrying the note? A Wouldn't that be thei-r deal? O That's my question. A The questj-on, I just asked if that wouldn't that be their deal, not mine? O Is it your testimony that it would be Mr. Haught and Mr. Johnes' responsibility? concerns, have you you addressed that A o A can I add just million dollar Boise National addressed that with an about liability attorney? Have Johnes? Yes, yes. Okay thank you. But we do have and we have to pay it property and gets hurt, there's of coverage for that. O The last question one thing? We do liability policy Forest. fn case have on the dam a one thatfs required by the somebody comes on that a mil-Iion dollars worth I have is you stated l_ 2 3 4 5 6 7 I 9 10 11 12 13 L4 15 76 L1 18 19 20 2t 22 23 24 CSB REPORTING 208 .8 90 . s198 RAY Atlanta Power Company 25 38 earlier that you were to you desired to have a year-to*year lease regardingt your 1and, what would happen to Atlanta Power Company if you revoked that lease? A Well, I don't know how to put this simply. I'm not a jerk. I'II work with them. You know, if f -- if they cou1d find a spot to put it maybe somewhere around town, it would be nice to move it. a Just to clarify, the I'it" is the generator? A ftrs the diesel generator and the dj-esel fuel tank. a Thank you. A So I'm not if they had to move lt, then I have a house up there, my pipes freezing up, so whole deal-. That' s kind diesel backup. interest in this of what somebody is we wouldn't have too, by the way I have a vested friendliest liking some that happens and I don't like misslng here. there. Wel1, Irve got a $400,000 itfs almost done. I people need to understand. what's best for the whole I farm and stuff. I get Gene and I like Nick and when house and stuff up have property and thatrs what I want what is best, because town is also best for me, and Irve l-ived there of f and on and I want to conti-nue 1t and this seems like the avenue, because people. I like and that's happened a llttle too much in 1 2 ? 4 5 6 1 8 9 10 11 t2 13 t4 15 16 1,7 18 19 20 27 22 23 24 CSB REPORTING 208.890. s198 RAY Atl-anta Power Company 25 39 Atlanta Power's time, I get personally invested in that. O So based upon your previous testimony, then, if the Commission were to require a more solidified lease agreement for a longer term, would you be open to that or are you firmly set on a year-to-year basis? A Oh, boy. I don't know. It's not just the generator. There's poles and transformers and stuff piled all over. When I was doing it, that was my problem if it looked o work with the an agreement the citizens your land? that I've worked further ug1y. Let me rephrase. Would Commission and Commission that best fits the benefit you be Staff willing to to iron out of Atlanta Power, of Atlanta, and your own desires regarding A I think I've proved that in my lifetime Mr. Ray, 0 Yes or no, please. A Yes, yes. MR. BROOKS: Thank you. questj-ons, Commissi-oner. COMMISSIONER ANDERSON : these are J-mportant questions, I donrt have any Thank you, and because the Commission, believe Power do well and be desires to see Atlanta and I know that we have it or not, healthy, 1 2 3 4 5 6 '7 8 9 10 11 72 13 t4 15 L6 71 18 19 20 21 22 23 24 CSB REPORTING 208.890.5198 RAY Atlanta Power Company 25 40 many people here that probably came down from Atlanta and I know that's a long trip for folks to travel. I've been up there only one ti-me and it can be treacherous. Even now this time of year, there's a lot of snow up there f'm sure, so it's important that all the customers, of Atl-anta we secure for the customers, Power that they have safe, aboutreliable servi-ce and we're going to be adamant deliberating on this very take on this, and all- the testj-mony thatrs been given today are going to be a part of that Order, so I l-ike the idea, I heard of April 1st as being a potential. If there were to be a contract, I wouldn't be surprised to see something of that nature in an Order when it does come out, so with that, I thank you for your testimony and you are excused. that, so we quickly and action that hearings They' re you get be some covered, are going to be we're going to werre going to determine what the course of fol-ks here don't think that we (The witness left the stand. ) COMMISSIONER ANDERSON: Show cause are different than a lot of hearlngs we do. basical-ly to the point and kind of concise and to the answers and then you move on. There may things that but we did cover what we can, so with that and there being no other further questions from any of the 1_ 2 3 4 5 6 7 8 9 10 11 t2 13 l4 15 16 L7 18 19 20 2I 22 23 24 CSB REPORTING 208.890.5198 RAYAtlanta Power Company 25 4L parties, I rm going to party or Commissioner that needs to be added go ahead and wrap this up, unless a f inds that there's somethj-ng else to the record prior to the Commission issuing a final Order in this case. The hearing will be complete and we will close the record, meaning the case will be deemed fu11y submitted and upon thatr we wlll be deliberating privately, and with that being said, we are now adjourned. Thank you very much for your attendance and thank you folks from Atlanta for coming down and partaklng in this, appreciate it very much. (The Hearing adjourned at 2255 p.m. ) a 1 2 3 4 5 6 7 I 9 10 11 72 13 t4 15 16 l7 18 19 20 21, 22 23 24 CSB REPORTING 208.890.5L98 RAYAtlanta Power Company 25 42 AUTHENTICATION This is to certify that the foregoing proceedings held in the matter of the investigation of Atlanta Power Company service and customer relati-ons, commencing at 2200 p.m. r oD Wednesday, Eebruary 23, 2022, at the Commission Hearing Room, 11331 W. Chinden BIvd, Building #8, Suite 201-A, Boise, Idaho, i-s a true and correct transcript of said proceedings and the original thereof for the file of the Commission. CONSTANCE Certified S. BUCY Shorthand Reporter BUCYScoNSTAIICE OF loAtloSTAIEPUBLENOTARYrn05NUMEERCOi,lMltiSl0N $s2024irfY 1 2 3 4 5 6 7 I 9 10 11 72 13 74 15 16 L7 18 19 20 2L 22 23 24 CSB REPORTING 208 .890.5198 RAY Atlanta Power Company 25 43