20260511Reply Comments.pdf

RECIDVED
REPLY COMMENTS OF SOUTHSHORE 2 WATER COMPANY LLC May 11, 2026
IDAHO PUBLIC
UTILITIES COMMISSION
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF SOUTHSHORE 2 WATER COMPANY LLC'S APPLICATION FOR A CERTIFICATE
OF PUBLIC CONVENIENCE AND NECESSITY
CASE NO. SSW-W-26-01
REPLY COMMENTS OF SOUTHSHORE 2 WATER COMPANY LLC IN SUPPORT OF STAFF'S
RECOMMENDATION AND APPLICATION FOR CERTIFICATE OF PUBLIC CONVENIENCE AND
NECESSITY
Southshore 2 Water Company LLC ("Company" or "Applicant") submits these Reply Comments
in response to the comments filed in this proceeding, including the Comments of Commission
Staff("Staff") and public comments submitted regarding the Company's Application for a
Certificate of Public Convenience and Necessity ("CPCN").
These Reply Comments are submitted pursuant to the Commission's Rules of Procedure,
including the Modified Procedure rules, IDAPA 31.01.01.201-204, and the rules governing
applications for certificates of public convenience and necessity, including IDAPA 31.01.01.111
and, to the extent applicable, IDAPA 31.01.01.112.
At the outset, the Company states that nothing in these Reply Comments is intended as, or
should be construed as, a waiver, concession, admission, or adjudication of any private property,
contract, corporate governance, CCR, deed, easement, water-right ownership, title, or civil
dispute. The Company expressly reserves all rights, claims, defenses, and arguments in any
forum of competent jurisdiction.
The issue presently before the Commission is whether the Company is operating or managing a
water system for compensation and whether the public convenience and necessity supports
issuance of a CPCN for the service area identified in the Application and reviewed by Staff. The
Company respectfully submits that the record supports Staff's recommendation and that the
Commission should issue the CPCN.
I. RESPONSE TO STAFF COMMENTS
The Company appreciates Staff's review of the Application, the supporting materials, and the
additional information provided during the review process.

Staff recommends that the Commission:
1. Find that the Company is a water corporation operating as a public utility in Idaho and
issue the Company a CPCN;
2. Designate the Company's service area to include the legal description and map reviewed
by Staff;
3. Set rates at the Company's interim rates as submitted in the Application;
4. Order the Company to submit a compliance filing with an updated tariff within 30 days
of order issuance; and
5. Open a separate docket for Staff to evaluate whether the Company's interim rates are
fair,just, and reasonable and to perform a reliability analysis of the Company's water
system.
The Company agrees with Staff's recommendation.
The Company supports issuance of the CPCN for the service territory identified by Staff. The
Company also agrees to work with Staff on the tariff compliance filing within 30 days of the
Commission's order, including Staff's recommended tariff revisions.
The Company further does not object to Staff's recommendation that a separate docket be
opened for review of interim rates and system reliability. The Company recognizes that the
CPCN proceeding and the rate/reliability review serve different regulatory purposes. Issuing a
CPCN will establish the Company's authority and obligation to provide regulated utility service,
while a separate docket will allow Staff and the Commission to review rates, tariff provisions,
and system reliability in greater detail.
The Company believes this approach is reasonable, orderly, and in the public interest.
II. PUBLIC UTILITY STATUS AND NEED FOR REGULATION
Staff concluded that the Company is a water corporation operating as a public utility subject to
Commission jurisdiction under Idaho Code Title 61.The Company agrees with Staff's conclusion.
The record reflects that the Company is the entity presently operating, managing, billing,
maintaining, and coordinating regulatory compliance for the water system serving Southshore
Subdivision No. 2. The system provides water service to residential customers within the
proposed service area. The Company is not a nonprofit cooperative or mutual entity owned and
controlled by the customers. Customers do not directly control the Company's rates, operations,
maintenance decisions, or capital expenditures.

Those facts support Staff's recommendation that the Company be regulated as a public utility.
They also support issuance of a CPCN.
The Company understands that some public comments raise questions regarding historic
documents, subdivision governance, HOA records, water-right documentation, and related
private-law issues.The Company does not agree with the conclusions stated in those
comments. However, the existence of disputed private-law arguments should not prevent the
Commission from exercising its regulatory authority over the entity presently operating or
managing the water system for compensation.
If anything,the comments filed in this case demonstrate why Commission regulation is
appropriate. A CPCN will provide a defined service area, Commission-approved tariffs, customer
protections, complaint procedures, Staff oversight, and future rate and reliability review. That is
the regulatory stability the CPCN process is designed to provide.
Ill. RESPONSE TO COMMENTS SUPPORTING THE APPLICATION
The Company appreciates the public comment supporting regulation of the water system and
continuation of service by the current operator.
The supporting comment reflects a practical concern that ongoing disputes regarding the water
system have created uncertainty for customers. The Company agrees that Commission
regulation will provide greater stability, transparency, and oversight. Issuance of a CPCN will
place the Company clearly under Commission jurisdiction and require the Company to comply
with applicable Commission rules, tariffs, customer notice requirements, billing rules, and
future Commission orders.
The Company believes that outcome is in the best interest of customers.
IV. RESPONSE TO HOA-RELATED COMMENTS
Several comments submitted by or on behalf of the Southshore 2 Homeowners Association
raise objections to the CPCN Application. The Company understands those comments to focus
primarily on alleged ownership and governance issues, including references to the subdivision
plat, CC&Rs, water-right records, DEQ records, HOA records, and homeowner voting or notice
issues.
The Company does not agree with the HOA's characterization of the record or its conclusions.
However, the Company does not believe this CPCN proceeding is the proper forum to adjudicate

private ownership, title, CCR interpretation, corporate governance, deed, easement,or civil
claims.
The Commission can determine whether the Company should be regulated as a public utility
without resolving every private-law dispute asserted by the HOA. Staff reviewed the
Application, the Company's records, and information submitted by the HOA. After that review,
Staff still recommended that the Commission find the Company to be a public utility and issue
the CPCN.
The Company respectfully submits that Staff's recommendation is the correct regulatory result.
V. OWNERSHIP ALLEGATIONS SHOULD NOT DELAY CPCN APPROVAL
The HOA comments request that the Commission refrain from authorizing or approving the
Application until ownership and control issues are "clarified." The Company respectfully
disagrees with that request.
A delay in issuing the CPCN would not resolve the HOA's private-law allegations. It would only
prolong regulatory uncertainty for customers and for the water system. The Company is
presently providing water service, and customers continue to require safe and reliable water
service regardless of any separate dispute between private parties.
The Commission's role in this proceeding is to determine whether public convenience and
necessity supports certification and regulation. Staff's comments answer that question in the
affirmative.
Issuing the CPCN does not need to be framed as a final civil adjudication of every private
property or title issue alleged by the HOA. Rather, issuance of the CPCN recognizes that the
Company is presently operating or managing the water system for compensation and should be
subject to Commission regulation, tariffs, customer rules, reporting obligations, and Staff
oversight.
That result protects customers and serves the public interest.
VI. PLAT, CCR,AND HOA GOVERNANCE ISSUES
The HOA comments rely heavily on selected language from the subdivision plat and CC&Rs. The
Company does not agree with the HOA's interpretation of those documents.
The Company also notes that the CC&Rs contain language recognizing a "Water System Owner,"
a "Water System Manager," fees for use of the water system, access rights for the water system

owner and manager, and the ability for the water system owner to establish assessments or fees
for water service. The Company does not ask the Commission to adjudicate the legal effect of
those provisions in this CPCN proceeding.
The point for this proceeding is narrower: the record supports Staff's conclusion that the
Company is operating or managing a water system for compensation and should be regulated
by the Commission.
To the extent the HOA believes it has private claims based on plat language, CC&Rs, deed
records, HOA governance, or alleged notice and voting requirements, those issues are separate
from the Commission's immediate regulatory determination under Idaho Code Title 61 and
IDAPA 31.01.01.111-112.
Those private-law allegations should not prevent the Commission from issuing a CPCN and
establishing regulatory oversight.
VII. WATER RIGHT AND AGENCY RECORD ISSUES
The HOA comments also raise issues regarding Water Right No. 63-32259, IDWR records, DEQ
records, and agency communications.
The Company does not agree that those comments provide a basis to deny or delay the CPCN.
The Company has provided water-right documentation and regulatory information in support of
its Application. Staff reviewed that information, along with information submitted by the HOA,
and recommended that the Commission issue the CPCN.
The Company further notes that DEQ and IDWR serve different regulatory functions than the
Commission. DEQ regulates public drinking water system compliance. IDWR administers water
rights. The Commission regulates public utilities under Idaho Code Title 61. The fact that
different agencies maintain different records or have different scopes of authority does not
eliminate the Commission's jurisdiction over a water corporation operating or managing a water
system for compensation.
The Company will continue to cooperate with applicable regulatory agencies and with Staff.
Vill. RATE AND BILLING COMMENTS
Some comments raise concerns regarding rates, billing authority, and customer charges.
The Company supports Staff's recommendation that the Commission set rates at the Company's
interim rates as submitted in the Application, pending further review. The Company also

supports Staff's recommendation to open a separate docket to evaluate whether those rates are
fair,just, and reasonable.
That process is the proper way to address rate issues. A separate rate review will allow Staff to
evaluate costs, revenues, expenses, rate design, tariff language, non-recurring charges, and any
other rate-related matters under the Commission's normal regulatory process.
The existence of rate questions is not a reason to deny a CPCN. Rather, rate questions are a
reason to bring the Company under Commission regulation so that rates and charges can be
reviewed and approved through the proper process.
IX. TARIFF COMPLIANCE
The Company agrees with Staff's recommendation that the Company submit an updated tariff
within 30 days of order issuance.
The Company will work with Staff to revise the tariff consistent with Staff's recommendations,
including:
1. Adding approved non-recurring charges;
2. Updating the late payment charge to one percent per month of unpaid balances,
consistent with Staff's recommendation;
3. Removing the "Meter Tampering/Unauthorized Use Fee"; and
4. Creating a separate schedule for DEQ fees.
The Company understands that Commission-approved tariffs are central to utility regulation and
customer protection. The Company is prepared to make the required compliance filing after the
Commission issues its order.
X. SERVICE AREA
The Company agrees with Staff's recommendation regarding the CPCN service territory.
Staff reviewed the legal description and map of the proposed service territory and confirmed
that it is consistent with the area where the Company currently provides water service. Staff

also confirmed that the proposed service territory does not overlap with another water system
and that no municipal water system exists within 1.0 mile of the area, based on Staff's review.
The Company supports designating the service area as described in Staff's Attachment A and
depicted in Staff's Attachment B.
XI. PUBLIC INTEREST AND CUSTOMER PROTECTION
Issuance of the CPCN is in the public interest.
The customers in Southshore Subdivision No. 2 require ongoing water service. The record
reflects that the Company is presently providing that service. Staff recommends that the
Company be regulated as a public utility. A CPCN will provide regulatory structure and
accountability, including:
1. A defined certificated service territory;
2. Commission-approved tariffs;
3. Customer protections under applicable Commission rules;
4. Staff review of rates and reliability;
5. A formal complaint process;
6. Ongoing Commission oversight; and
7. Clear regulatory obligations for the Company.
Denying or delaying the CPCN would not resolve private disputes. It would leave customers and
the water system in a less certain regulatory position.
The better course is the one recommended by Staff: issue the CPCN, establish the service area,
set interim rates, require a tariff compliance filing, and open a separate docket for rate and
reliability review.
XII. RESERVATION OF RIGHTS
The Company again states that nothing in these Reply Comments is intended as, or should be
construed as, a waiver, concession, admission, or adjudication of any private property, contract,
corporate governance, CCR, deed, easement, water-right ownership, title, or civil dispute.

The Company expressly reserves all rights, claims, defenses, and arguments in any forum of
competent jurisdiction.
The Company's position in this proceeding is limited to the regulatory issues before the
Commission: whether the Company is operating or managing a water system for compensation,
whether it should be regulated as a public utility, whether the CPCN should be issued, and
whether the Commission should adopt Staff's recommended regulatory conditions.
XIII. CONCLUSION
For the reasons stated above, Southshore 2 Water Company LLC respectfully requests that the
Commission issue an order:
1. Finding that Southshore 2 Water Company LLC is a water corporation operating as a
public utility subject to Commission jurisdiction under Idaho Code Title 61;
2. Issuing the Company a Certificate of Public Convenience and Necessity;
3. Designating the service area within the CPCN to include the legal description and service
area map recommended by Staff;
4. Setting rates at the Company's interim rates as submitted in the Application, pending
further review;
5. Ordering the Company to submit a compliance filing with an updated tariff within 30
days of order issuance, consistent with Staff's recommendations; and
6. Opening a separate docket for Staff to evaluate whether the Company's interim rates are
fair,just, and reasonable and to conduct a reliability analysis of the Company's water
system.
Respectfully submitted this LL day of Mw�, 2026.
SOUTHSHORE 2 WATER
\COMPANY LLC
By:1k:VM MAIAA,
Ryan Martin
Managing Member/Authorized Representative

CERTIFICATE OFSERVICE
| HEREBY CERTIFY that on this U day of 2026i | caused etrue and correct copy of
the foregoing Reply Comments ofSouthshore2Water Company LLCtobe served upon all
parties ofrecord in Case No. SSW-\N-26'01 by electronic mail, as reflected on the Commission's
Notice ofParties.
Signature:
Ryan Martin '
Southshore2 Water Company LLC
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