20101013min.doc

IDAHO PUBLIC UTILITIES COMMISSION

MINUTES OF DECISION MEETING

OCTOBER 13, 2010 – 1:30 P.M.

In attendance were Commissioners Marsha Smith, Mack Redford, and Jim Kempton, who participated by telephone. Also participating by telephone were Jim Smith and Gary Kajander of Monsanto.

Commissioner Smith called the meeting to order. The first order of business was APPROVAL OF MINUTES FROM PREVIOUS MEETING on Monday, October 4, 2010. The Commission voted unanimously to approve the minutes as written.

The second order of business was approval of the CONSENT AGENDA:
2. Carolee Hall's October 8, 2010 Decision Memorandum re: Cambridge Telephone Company, Inc. (Cambridge) Voluntary Relinquishment of the NPA NXX, 208-253, from the Cuprum Exchange.3. Carolee Hall's October 7, 2010 Decision Memorandum re: Cancellation of Certificate No. 351 for Intellicall Operator Services, Inc., ("Intellicall") Issued in Case No. IOS-T-98-01.4. Carolee Hall's October 6, 2010 Decision Memorandum re: CenturyTel of the Gem State, Inc., dba CenturyLink ("CenturyLink") Tariff Advice 10-03 Requesting Authority to Introduce a New Outbound Call Block Feature with an Effective Date of October 29, 2010.5. Grace Seaman's October 8, 2010 Decision Memorandum re: CenturyLink's Application for Approval of the Interconnection and Exchange of Traffic Agreements, Case Nos. CEN-T-10-04/CGS-T-10-03.6. Grace Seaman's October 8, 2010 Decision Memorandum re: Citizen's Application for Approval of a Cellular and 2-Way Mobile Radio Services Traffic Agreement, Case No. CTC-T-10-02.7. Grace Seaman's October 7, 2010 Decision Memorandum re: Potlatch Telephone Company's Compliance Filing to Change Idaho USF Surcharge, Advice Letter No. 10-05.8. Terri Carlock's October 7, 2010 Decision Memorandum re: Avista Corporation's Application for Authority to Enter Into Credit Facilities Up To $600,000,000, Case No. AVU-U-10-01.9. Weldon Stutzman's October 5, 2010 Decision Memorandum re: Idaho Power Company's Request for Acceptance of Its 2011 Retirement Benefits Package, Case No. IPC-E-10-25.
Commissioner Redford asked that item 9 be considered separately to allow for discussion. The Commission then voted unanimously to approve Staff’s recommendations for items 2 – 8 on the Consent Agenda.
Regarding item 9, Commissioner Redford stated he was concerned that the Commission had asked Idaho Power to do a review of its benefits package, and in this application the Company is asking for approval of its 2011 retirement benefits package, which seemed premature without having the review. He said he would rather the Commission just acknowledge that we have received the application, as he had imagined a more in-depth review of the present benefits package and findings. He asked Mr. Stutzman if the Commission was in a position to accept the report, with acceptance seeming to be another word for approval. He said he had no problem acknowledging that Idaho Power has done this plan, but would like more discussion.
Mr. Stutzman said the Company filed this application because it believes it is responsive to what the Commission asked the Company to do. He said all Staff is recommending at this point is that the application be processed, and in that process, Staff will evaluate the substance of the filing and weigh in on whether or not Idaho Power has complied with the Commission’s directive.
Commissioner Smith said the Commission had requested that the Company review its retirement and benefits package because of concern about escalating costs into the future. She stated it wasn’t her intent to oversee the Company’s internal process, but the Commission did need some assurance the Company had done the review, and this filing is that assurance of what their investigation showed. She questioned why Staff is asking for comments.
Mr. Stutzman replied that Staff is asking for comments because there may be some question as to whether or not the Company completed a thorough investigation, as Commissioner Redford had expressed.
Commissioner Smith added that no one envisions any rates will change or any amounts will be approved for inclusion in rates through this process.
Terri Carlock stated that the Company intends to make a second filing that will incorporate the numbers, which will then be part of a revenue requirement case.
Commissioner Smith confirmed that the purpose of the comments and replies will be to have Staff or any interested party analyze whether the Company has done a thorough job of the review the Commission requested.
Commissioner Kempton stated it was his understanding that the direction from the Commission to Idaho Power was that it intended to look at this issue in another forum subsequent to the time Idaho Power makes any decisions about any adjustments to its plan. He said he understands that Idaho Power is aware of the Commission’s interests in this area and we can expect to have discussions relative to any revisions to the plan in the future.
Commissioner Redford asked Ms. Carlock about the Company’s next filing regarding this issue. She replied that in conversations with the Company, she anticipates that this filing will provide a review of the plan and the next filing will be a review of the numbers with a recommendation for inclusion in revenue requirement, using modified procedure with a comment period.
Commissioner Redford stated that acceptance of the plan is tantamount to approval, and he was concerned about accepting a plan that has not gone through the complete procedure. Ms. Carlock stated that acceptance could mean a couple of different things, such as accepting the plan as the Commission does IRPs, or it could accept it for inclusion in rates. She said there are a couple of aspects that might be coming as far as offsets for the revenue requirement.
Commissioner Smith stated the Commission is not accepting anything today—it’s just asking for comments. She said after the Commission receives the comments and reviews them, it can decide how to characterize it.
Commissioner Kempton asked Commissioner Smith to rephrase the motion, and she stated that the only decision for the Commission to make regarding Idaho Power’s application is whether to accept comments for 60 days with a 14-day reply period. Commissioner Redford made a motion to process the application by modified procedure with a 60-day comment period and a 14-day reply period. A vote was taken on the motion and it carried unanimously.
The next order of business was MATTERS IN PROGRESS:
10. Discussion re: Yellowstone Power, Inc.'s Motion to Set Time for Oral Argument, Case No. IPC-E-10-22. [Kristine Sasser, Attorney]
Ms. Sasser reviewed Mr. Miller’s motion. Commissioner Smith stated the Commission had found a time for the oral argument when all parties will be available, October 26th at 2:00 p.m. She stated the decision for the Commission is whether to establish an oral argument to hear the motion on October 26th at 2:00 p.m. A vote was taken and it carried unanimously.11. Discussion re: PacifiCorp -- September 30, 2010 Supplemental Testimony (Clements) -- Valuation of Interruptible (Curtailment) Products; Monsanto Motion to Dismiss or Strike Testimony, Case No. PAC-E-10-07 (PacifiCorp). [Scott Woodbury, Attorney]
Mr. Woodbury reviewed the filings that had been made, beginning with the filing of supplemental testimony by PacifiCorp on September 30, 2010, regarding the economic valuation of interruptible products offered by Monsanto and purchased by PacifiCorp. He stated that on October 1st, Monsanto filed a motion to dismiss the rate case or strike the testimony, and on October 8th, pursuant to an informal Commission request, PacifiCorp and Staff had filed answers to Monsanto’s motion. He stated that Monsanto presently receives service pursuant to a 2008 service agreement and tariff schedule 400. He said the service agreement expires on December 31st, 2010, and Staff recommended that the issues presented by the supplemental testimony of Paul Clements should be moved to a new docket. He said both Monsanto and PacifiCorp believe the issues should be resolved as part of this case. He noted the deadline for filing direct testimony is October 14th and the case is scheduled to begin technical hearing on November 30th, with the suspension period for the rate case expiring December 28th. He stated the Commission desires oral argument on the procedural issues presented by the recent filings and an acceptable time had been agreed to by Monsanto, PacifiCorp and Staff-- 1:00 p.m. on October 18th.
Commissioner Smith stated that she has questions she would like to ask in an oral argument setting and it is a good resolution if it is agreeable with all three commissioners to move Monday’s Decision Meeting to 11:00 a.m. and then use the afternoon for the oral argument. Commissioner Smith stated she was not surprised this testimony was filed and she knew that Monsanto and the Company have been negotiating over this issue for many months. She stated that because the contract expires at the end of the year, it is incumbent upon the Commission to get an answer to this question before the end of the year so we know what, if any, rate is appropriate. She stated it is her hope we can devise a schedule that gets this question answered before the end of the year.
Commissioner Kempton added that the situation we are in results from settlements that have been going on since before 2006, and when settlements are negotiated it is incumbent upon the parties to come to a conclusion that meets the time constraints so the parties can achieve their respective goals in terms of a rate case. He said he is a little disappointed in PacifiCorp’s filing at this point in time, using a model-derived filing and not giving Monsanto sufficient time to respond satisfactorily. He said he didn’t see how Monsanto could have responded given the time constraints of the rate case. He added that it is paramount that PacifiCorp propose a process by which we achieve resolution of this problem by the end of the year.
Paul Hickey, of the firm of Hickey and Evans in Cheyenne, Wyoming, stated that he is representing PacifiCorp in this docket, and he introduced himself and Yvonne Hogle, a senior attorney from the law department of Rocky Mountain Power in Salt Lake, and Ted Weston, Rocky Mountain Power’s state regulatory director for Idaho. He stated there really are some points to be made and he didn’t want to overstep the boundaries, knowing there is going to be oral argument on Monday. He said the pleading that was filed by the Company responding to the Motion to Dismiss and the Motion to Strike sets forth PacifiCorp’s and Rocky Mountain Power’s view that Monsanto knew for months the negotiations were ongoing.
Commissioner Smith responded that the Commission has the filings and this was not the time to make their arguments.
Mr. Hickey thanked the Commission for allowing him to appear in this docket pro hac vice and stated he looked forward to presenting their arguments on Monday at the time scheduled for oral argument.
There was no further business before the Commission and Commissioner Smith adjourned the meeting.

__________________________________ ________________________
COMMISSION SECRETARY DATE OF APPROVAL

1