20250509Direct Donn English Exhibits.pdf

RECEIVED
Friday, May 09, 2025
IDAHO PUBLIC
BEFORE THE UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF VEOLIA )
WATER IDAHO, INC.'S ) CASE NO. VEO-W-24-01
APPLICATION TO INCREASE ITS )
RATES AND CHARGES FOR )
WATER SERVICE IN THE STATE )
OF IDAHO )
DIRECT TESTIMONY OF DONN ENGLISH
IN SUPPORT OF THE STIPULATION
AND SETTLEMENT
IDAHO PUBLIC UTILITIES COMMISSION
MAY 9, 2025

1 Q. Please state your name and business address?
2 A. My name is Donn English. My business address is
3 11331 W. Chinden Blvd. , BLDG 8, STE 201-A, Boise, Idaho
4 83714 .
5 Q. By whom are you employed and in what capacity?
6 A. I am employed by the Idaho Public Utilities
7 Commission ("Commission") as a Program Manager overseeing
8 the Accounting and Finance Department in the Utilities
9 Division.
10 Q. Please describe your educational background and
11 professional experience .
12 A. I was hired by the Commission in 2003 and I have
13 provided testimony and recommendations in numerous
14 proceedings . My educational background and professional
15 experiences are provided in Exhibit No . 101 .
16 Q. What is the purpose of your testimony in this
17 proceeding?
18 A. The purpose of my testimony is to describe Veolia
19 Water Idaho, Inc. ' s ("Veolia" or "Company") Application to
20 increase its rates and charges for water service in Idaho,
21 describe the proposed Stipulation and Settlement
22 ("Settlement") reached by the parties in this case, and
23 explain Staff' s support for the proposed Settlement .
24 Q. How is your testimony organized?
25 A. My testimony is organized under the following
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 1
05/09/25 STAFF

I headings :
2 Background Page 2
3 Staff Investigation Page 3
4 Settlement Evaluation Page 5
5 Settlement Overview Page 6
6 Background
7 Q. Please describe Veolia' s Application.
8 A. Veolia made its original filing with the Idaho
9 Public Utilities Commission on November 22, 2024,
10 requesting authority to increase its revenue by
11 approximately $11 . 16 million, or approximately 19 . 84% . The
12 Company proposed to mitigate the requested increase with a
13 two-phase rate plan, whereby 70% of the requested increase
14 would be effective on December 23, 2024 and the remaining
15 30% of the requested increase would be effective twelve
16 months later on December 23, 2025 . Veolia proposed to
17 implement the requested increase in revenue by a uniform
18 percentage increase to all rate elements, except for
19 private fire rates . The Company proposed a weighted
20 average cost of capital of 7 . 47%, with a return on equity
21 of 10 .2%, and a capital structure consisting of 52 . 8%
22 equity and 47 .2% debt .
23 Additionally, the Company proposed a revision to its
24 Rules and Regulations Governing the Rendering of Water
25 Service to remove Private Fire Hydrant charges from the
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 2
05/09/25 STAFF

1 Tariff; modifications to the definition of "private fire
2 hydrant" that has been vetted by Fire Districts within the
3 Company' s service territory; and to define the
4 responsibilities associated with owning a private fire
5 hydrant . The Company also proposed adding a 12-inch meter
6 charge under General Metered Service, and other
7 administrative modifications to the Tariff as outlined in
8 its Application.
9 Q. How was the case processed after the Company' s
10 Application was received?
11 A. The Commission issued a combined Notice of
12 Application, Notice of Suspension of Proposed Effective
13 Date, and Notice of Intervention Deadline on December 13,
14 2024 . The Notice established an Intervention Deadline of
15 January 3, 2025 . Intervenor status was subsequently
16 granted to Micron Technology, Inc . ("Micron") and The City
17 of Boise City ("The City") .
18 The Company, Staff, Micron, and The City (collectively
19 the "Parties") participated in a settlement conference on
20 March 10, 2025, and on April 21, 2025, a comprehensive
21 Settlement was filed with the Commission, signed by all
22 parties .
23 Staff Investigation
24 Q. What type of investigation did Staff conduct to
25 evaluate the Company' s rate increase request?
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 3
05/09/25 STAFF

1 A. Staff' s approach in any general rate case is to
2 extensively review the Company' s Application and associated
3 testimony, attachments, exhibits, and workpapers; identify
4 adjustments to its revenue requirement, revenue
5 normalization, rate spread, and rate design; and prepare to
6 file testimony for a fully litigated proceeding. There
7 were 13 Staff members analyzing this case, including
8 auditors, engineers, utility analysts, consumer
9 investigators, and supervisors . Staff auditors reviewed
10 the Company' s 2024 results of operations, 2024 capital
11 budgets, capital spending trends, operations and
12 maintenance ("O&M") expenses and trends, and verified all
13 of the Company' s calculations and assumptions regarding the
14 overall revenue requirement . The auditors reviewed
15 thousands of transactions, selected samples, and performed
16 transaction testing in accordance with standard audit
17 practices . Staff reviewed the Company' s labor expense,
18 incentive plans, and employee benefits to ensure the
19 appropriate level of expenditures are included in rates .
20 Staff reviewed the capital investments completed since
21 the Company' s last general rate case to determine the
22 prudence of capital additions . Expenditures including
23 pension expense, salaries, and 0&M expense were also
24 examined. Additionally, Staff evaluated the Company' s cost
25 of capital, capital structure, rate spread, and revenue
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 4
05/09/25 STAFF

1 normalization. In total, Staff propounded 175 production
2 requests and reviewed the responses the Company provided to
3 an additional 35 production requests propounded by Micron.
4 Staff performed onsite audits at the Company' s facilities
5 in Boise and held several virtual meetings with Company
6 personnel as a part of its comprehensive investigation.
7 Based on its investigation, Staff was prepared to defend 26
8 proposed adjustments to the Company' s revenue requirement
9 in testimony and at hearing.
10 Settlement Evaluation
11 Q. How did Staff determine that the overall
12 Settlement was reasonable?
13 A. In every settlement evaluation, Staff and other
14 parties must examine the risks of losing positions at
15 hearing and determine if the settlement agreement is a
16 better overall outcome . Staff must evaluate each
17 individual adjustment and determine the likelihood of the
18 Commission accepting or rejecting Staff' s rationale for the
19 adjustment . Ultimately, Staff' s intent in every settlement
20 conference is to negotiate the best possible outcome for
21 customers .
22 Q. Does Staff support the proposed Settlement as
23 reasonable?
24 A. Yes . After a comprehensive review of the
25 Company' s Application, thorough audit of the Company' s
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 5
05/09/25 STAFF

1 books and records, and extensive negotiations with the
2 parties to the case, Staff supports the proposed
3 Settlement . The proposed Settlement is the result of
4 extensive negotiations with, and compromises by, of all the
5 Parties . The proposed Settlement offers a reasonable
6 balance between the Company' s opportunity to earn a
7 reasonable return on its investment and affordable rates
8 for customers . Staff believes the proposed Settlement,
9 supported by the Parties, is in the public interest; fair,
10 just, and reasonable; and should be approved by the
11 Commission.
12 Settlement Overview
13 Q• Would you please describe the terms of the
14 proposed Settlement?
15 A. The proposed Settlement provides a reduction in
16 the Company' s requested revenue requirement . Instead of
17 the Company' s proposed two-year phased-in base rate
18 increase of $11 . 16 million, or 19 . 84%, base rates will
19 increase by $7 million, or approximately 11 . 8%, upon
20 Commission approval of the Settlement and Stipulation.
21 There will not be a second-year increase in 2026, and the
22 Company will not be allowed to file a general rate case
23 where new rates would become effective before January 1,
24 2027 .
25
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 6
05/09/25 STAFF

1 Revenue Requirement and Rate Design
2 Q. How was the final revenue requirement increase of
3 $7 million determined?
4 A. The final revenue requirement was agreed upon
5 through intense negotiations with the Parties . While the
6 Company did not agree to specific adjustments proposed by
7 Staff and the intervening parties, the $7 million increase
8 was accepted by the Parties as a fair and reasonable
9 increase based on the likely outcome had the case gone
10 through a fully litigated hearing. Certain components of
11 the revenue requirement calculation are outlined in the
12 proposed settlement, including the deferred debit balances
13 to be amortized, the agreed upon overall rate of return,
14 and an adjustment to the Company' s rate base .
15 Q. Please describe the amortization of deferred
16 debit accounts in the proposed settlement .
17 A. The deferred debit accounts are regulatory assets
18 or liabilities that are amortized over a period of years
19 rather than included at their full value in a single year.
20 The expenses in these accounts are either one-time expenses
21 or volatile expenses that are amortized over several years
22 to smooth recovery. The balances and amortization periods
23 are described on pages 3 and 4 of the Settlement and
24 include pension costs, power costs, rate case expenses,
25 deferred convenience fees, tank paintings, and the
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 7
05/09/25 STAFF

1 regulatory liability associated with Tax Cuts and Jobs Act
2 effective January 1, 2018 .
3 Q. Please describe how the proposed Settlement
4 treats the Company' s capital structure and rate of return.
5 A. The Settlement reduces the Company' s overall rate
6 of return from the proposed 7 . 47% to 7 . 050 . The capital
7 structure, cost of debt, and return on equity are not
8 specified in the Settlement .
9 Q. Please describe the provision in the Settlement
10 as it relates to the Company' s rate base .
11 A. The Parties agree that the Revenue Requirement
12 reflects an adjustment to reduce plant-in-service in the
13 amount of $390, 000 associated with the Five Mile main line
14 extension project .
15 Q. Please explain how the Settlement addresses Cost
16 of Service, Rate Design, and Rate Spread.
17 A. The Parties agree to accept the Company' s
18 proposed class revenue apportionment included in its
19 Application. The stipulated increase will be applied as a
20 uniform percentage increase to the Company' s rate
21 components as outlined in Exhibit No . 1 to the Settlement .
22 The tariffs included in Exhibits No . 2 (clean) and 3
23 (redline) reflect the rates and language agreed to by the
24 Parties .
25
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 8
05/09/25 STAFF

1 Additional Settlement Terms
2 Q. Will you please describe the additional
3 Settlement Terms contained in the Settlement and
4 Stipulation?
5 A. Yes . The Parties agree to hold workshops to
6 discuss weather normalization methodologies; the necessary
7 criteria to include in a load study to inform a cost-of-
8 service study to establish a cost-based rate design; and
9 potential revenue-recovery mechanisms . Additionally, the
10 procurement and project management processes will be
11 discussed to determine if any improvements can be made .
12 The Parties recognize the scheduling difficulties
13 associated with the workshops, and that not every workshop
14 will cover every issue, but it is the intent of the Parties
15 that these workshops occur at least on a semi-annual basis .
16 Q. Are there any other provisions in the Settlement
17 and Stipulation?
18 A. Yes . The Company agrees not to file another
19 general rate case such that the proposed new rates would
20 become effective before January 1, 2027 . This stay-out
21 provision provides customers with rate stability during a
22 time of continued inflationary pressures and uncertain
23 capital investment requirements .
24 Q. Do you have any other comments on the case and
25 the proposed Settlement?
CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 9
05/09/25 STAFF

1 A. Yes . The Company filed a relatively clean rate
2 case that was consistent with the Commission Order in the
3 Company' s previous fully litigated general rate case (Order
4 No . 35762 in Case No . VEO-W-22-02) , which eliminated many
5 of the adjustments Staff would generally propose in rate
6 cases . The fact that the Settlement reduces the proposed
7 revenue requirement by approximately 40o is a testament to
8 the work performed by Staff and the Parties, and the
9 collaboration and compromises made by the Company. As
10 implied throughout this testimony, the Settlement
11 represents a fair, just, and reasonable compromise of the
12 positions put forth by all parties and is in the public
13 interest . Therefore, Staff recommends the Commission
14 approve the Settlement without material changes or
15 modifications .
16 Q. Does this conclude your testimony?
17 A. Yes, it does .
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CASE NO. VEO-W-24-01 ENGLISH, D. (Stip) 10
05/09/25 STAFF

Professional Qualifications
of
Donn English
Program Manager - Accounting and Finance
Idaho Public Utilities Commission
EDUCATION
Mr. English graduated from Boise State University in 1998 with a
Bachelor of Business Administration degree in Accounting. His
studies concentrated on corporate finance and taxation. He was
a member of the Alpha Beta Psi honor society for Accounting
students . He completed the Annual Regulatory Studies Program,
the Advanced Regulatory Studies Program, and the Accounting and
Ratemaking Course offered through the Institute of Public
Utilities at Michigan State University. Additionally, he
regularly attends meetings and conferences sponsored by the
National Association of Regulatory Commissioners (NARUC) and the
Society of Utility and Regulatory Financial Analysts .
In 2001, Mr. English became a designated member of the American
Society of Pension Professionals and Actuaries (ASPPA) and was
awarded the professional designation of Qualified Pension
Administrator (QPA) and Qualified 401 (k) Administrator (QKA) .
Mr. English was also a member of the Association of Certified
Fraud Examinators .
BUSINESS EXPERIENCE
Prior to joining the Idaho Public Utilities Commission (IPUC) ,
Mr. English was a Trust Accountant with a pension
administration, actuarial, and consulting firm in Boise, Idaho .
In 1999, he was promoted to Pension Administrator, and in 2001
he was promoted to Pension Consultant . In that capacity, Mr.
English performed actuarial calculations and the required non-
discrimination calculations for hundreds of qualified retirement
plans . He completed and filed Form 5500s and represented
clients during audits by the Department of Labor and the
Internal Revenue Service . He also participated in the task
force that wrote questions for the ASPPA administrator and
actuarial exams .
Exhibit No . 101
Case No . VEO-W-24-01
D. English, Staff
5/09/25 Page 1 of 2

Mr. English joined the IPUC in 2003 as a Staff Auditor. In
2016, he was promoted to Audit Team Lead, and in 2018 he became
the Program Manager for the Accounting and Finance Department
within the Utilities Division. From September 2020 - March
2022, Mr. English also accepted the responsibility of
supervising the Technical Analysis and Energy Efficiency team
and was the Program Manager for that team until 2022 . At the
Commission, Mr. English has audited numerous utilities including
electric, water, and natural gas companies, and provided
comments and testimony in numerous cases that dealt with general
rates, tax issues, pension issues, depreciation and other
accounting issues, and other regulatory policy decisions . Mr.
English participates in the Energy Efficiency Advisory Groups
and External Stakeholder Advisory Committees for Idaho Power,
Avista Utilities, Rocky Mountain Power, and Intermountain Gas
Company. He is a member of several of the National Association
of Regulatory Utility Commissioners (NARUC) working groups
including the NARUC State Working Group on Performance-Based
Regulation, the NARUC State Working Group on Electric Vehicles,
and the NARUC State Working Group on Grid-Interactive Efficient
Buildings in collaboration with the National Association of
State Energy Officials (NASEO) . Mr. English is the Chair of the
NARUC Staff Subcommittee on Education and Research and the Vice
Chair of the NARUC Staff Subcommittee of Accounting and Finance .
Mr. English is also a faculty member of NARUC Rate School .
Exhibit No . 101
Case No . VEO-W-24-01
D. English, Staff
5/09/25 Page 2 of 2

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS _1 DAY OF MAY 2025,
SERVED THE FOREGOING DIRECT TESTIMONY OF DONN ENGLISH IN
SUPPORT OF THE STIPULATION AND SETTLEMENT , IN CASE NO. VEO-W-24-
01, BY &MAILING A COPY THEREOF, TO THE FOLLOWING:
PRESTON N CARTER DAVID NJUGUNA
MORGAN D. GOODIN DIRECTOR—REGULATORY BUSINESS
MEGANN E. MEIER VEOLIA WATER M&S (PARAMUS), INC.
GIVENS PURSLEY LLP 461 FROM ROAD, SUITE 400
PO BOX 2720 PARAMUS,NJ 07052
BOISE ID 83701-2720 E-MAIL: david.njugunakveolia.com
E-MAIL: prestoncarter&givenspursley.com
morganggodin@ ig venspursla.com
memkgivenspursley.com
stephaniewkgivenspursley com
AUSTIN RUESCHHOFF MARY R. GRANT
THORVALD A NELSON DEPUTY CITY ATTORNEY
AUSTIN W JENSEN BOISE CITY ATTORNEY'S OFFICE
KRISTINE A.K. ROACH 150 N. CAPITOL BLVD.
HOLLAND & HART LLP PO BOX 500
555 17TH ST STE 3200 BOISE, ID 83701-0500
DENVER CO 80202 E-MAIL: mrgrant(kcityofboise.org
E-MAIL: darueschhoff(c hollandhart.com boisecityattorney&cityofboise.org
tnelsonghollandhart.com
awj ensen&hollandhart.com
karoach&hollandhart.com
aclee@,hollandhart.com
STEVEN HUBBLE
CLIMATE ACTION SENIOR MANGER
ROBIN LEE-BEUSAN
WATER RESOURCES PROGRAM
COORDINATOR
E-MAIL: shubblegcityofboise.org
rleebeusan&cityofboise.org
PA RICIA JORDA , SECRETARY
CERTIFICATE OF SERVICE