20101104Staff 1-20 to IPC.pdf

WELDON B. STUTZMAN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
472 WEST WASHINGTON STREET
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
BARNO. 3283
RECE D
2ûIßNOV -4 PM 2:49
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5918
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
IDAHO POWER COMPANY FOR )
ACCEPTANCE OF ITS 2011 RETIREMENT )BENEFITS PACKAGE. )
)
)
)
)
CASE NO. IPC-E-I0-25
FIRST PRODUCTION
REQUEST OF THE
COMMISSION STAFF TO
IDAHO POWER COMPANY
The Staf of the Idaho Public Utilities Commission, by and through its attorney of record,
Weldon B. Stutzan, Deputy Attorney General, requests that Idaho Power Company (Company;
IPC) provide the following documents and information as soon as possible, but no later than
WEDNESDAY, NOVEMBER 24,2010.
This Production Request is to be considered as continuing, and Idaho Power Company is
requested to provide, by way of supplementary responses, additional documents that it or any
person acting on its behalf may later obtain that wil augment the documents produced.
For each item, please indicate the name of the person(s) preparing the answers, along with
the job title of such person(s) and the witness who can sponsor the answer at hearing.
FIRST PRODUCTION REQUEST TO
IDAHO POWER COMPANY 1 NOVEMBER 4,2010
REQUEST NO.1: The Application states that "the curent retirement benefits package
represents approximately 9.1 percent of a new salaried employee's base pay. Of that amount,
approximately 33 percent is associated with the 401(k) benefit plan, approximately 65 percent is
associated with the defined benefit plan, and approximately two percent is associated with the
retiree medical benefit plan." Please provide the calculations used to determine (a) the
representation that the current retirement benefits package represents approximately 9.1 % of a
new salaried employee's base pay, and (b) the allocation between the three different benefit plans.
Please show all assumptions used in determining the represented figures in the statements above.
Please also provide the schedules in Excel format with all links and formulas operationaL.
REQUEST NO.2: Please provide schedules showing the same information as in Request
No. 1 with the changes to the pension plan, including the overall retirement benefits package
representing approximately 7.9 percent of a new salaried employee's base pay and the new
allocation between plans. Please also provide the schedules in Excel format with all links and
formulas operationaL.
REQUEST NO.3: The Application states that "additional weight is placed on the defined
benefit plan because it rewards and incents longevity, which in tum faciltates the development
and retention of knowledge and expertise. As a result, the Company maintains a skiled workforce
with less time and expense incured for training and developing new employees." Please provide
(a) any and all analyses done to determine the cost to train and develop new employees, (b) any
and all cost/benefit analysis done and/or used to determine the appropriate level of retirement
benefits needed to retain employees, and (c) any studies done and/or used to determine the level of
employee retention as it relates to the retirement benefit package offering.
REQUEST NO.4: Please define the positi'ons that the Company asserts are classified as
"critical operations roles". Please identify all positions that are classified as "critical operations
roles". For each position classified as a "critical operations role", please provide the current
salary, amount of last anual incentive payment, date of last anual incentive payment, date of
birth, date of hire, years of experience in that role with the Company, and years of experience in a
similar position outside of the Company.
FIRST PRODUCTION REQUEST TO
IDAHO POWER COMPANY 2 NOVEMBER 4,2010
REQUEST NO.5: The Application states that "the Company's three component
approach to an overall retirement benefits package was specifically developed to balance market
risk between the Company and its retirees." Given Commission Order No. 31003 that allows for a
regulatory balancing account for cash contributions and provides for the amortization of the
balance in such account, including carying charges, does the Company agree that any market risk
included in its retirement benefit package that is allocated to the Company is ultimately borne by
its ratepayers? If not, why not?
REQUEST NO.6: Please provide a complete copy of the benchmark analysis completed
by Towers Watson comparing the retirement benefits of 700 companies, including 92 energy
industry companies, and referred to in the Company's Application. Please provide the schedule in
Excel format with all links and formulas operational and searchable.
REQUEST NO.7: Exhibit No.1, page 1, states that "Twelve Idaho Power peer group
companies were analyzed separately."
a) Please provide a list of the twelve companies in the peer group of twelve similar-sized
and geographically proximate utilities.
b) Please provide the analysis used for each company.
c) Please also provide the schedules in Excel format with all links and formulas
operational and searchable.
d) Please provide the search criteria used to determine the companies included in the
analysis.
REQUEST NO.8: Exhibit No.1, page 1, states that "Based on benefits available to a
new salaried employee at time surey was conducted; most recent changes not reflected". Please
provide the actual surveys done for each company and the dates that the survey was conducted.
REQUEST NO.9: The Application states that "Idaho Power respectfully requests that
the Commission issue its Order accepting the Company's 2011 Retirement Benefits Package..."
In addition to the statement in Anderson Direct, p. 13, how does the Company define the term
FIRST PRODUCTION REQUEST TO
IDAHO POWER COMPANY 3 NOVEMBER 4,2010
"accept" in this case? What does the Company believe the ramifications to be if the Commission
does not accept the Company's 2011 Retirement Benefits Package?
REQUEST NO. 10: Given the direction from Commission Order No. 31091, as
acknowledged in the Application and direct testimony of Greg Said, please explain how the
Company's review of its retirement benefits package was different this year from previous years.
REQUEST NO. 11: Please provide copies of the plan documents and summar plan
descriptions for the defined benefit pension plan, the 401 (k) plan and the retiree medical benefit
plan.
REQUEST NO. 12: Sharon Gerschultz states in her direct testimony (p. 11, In. 21) that
"while the present value of both plans were very similar, the costs and contributions for the 401(k)
benefit plan would be higher in the near term as compared to the defined benefit plan." Please
provide any and all analyses done that supports Ms. Gerschultz's conclusion.
REQUEST NO. 13: Please provide the detailed analysis to support Ms. Gerschultz's
(Direct p. 12) conclusion "that the defined benefit plan would tend to attract and incent a more
experienced workforce, whereas the 401(k) plan would tend to attract a less experienced
workforce."
REQUEST NO. 14: Sharon Gerschultz states in her direct testimony (p. 17) that the
"modified plan wil also result in additional cost savings by promoting the retention of highly-
skiled, fully-trained, long-tenured workers." Please provide any and all studies quantifying the
cost savings referred to in the above statement.
REQUEST NO. 15: Please provide the source of the total pensionable earnings of$164
milion referred to in Ms. Gerschultz direct testimony, page 17.
REQUEST NO. 16: Ms. Gerschultz claims in her direct testimony (p. 17) that the
modified plan wil "result in approximately $1.97 milion yearly savings once the workforce is
FIRST PRODUCTION REQUEST TO
IDAHO POWER COMPANY 4 NOVEMBER 4,2010
fully transitioned." Please explain what is meant by "fully transitioned", and state the Company's
estimate of time it wil take for the workforce to be "fully transitioned".
REQUEST NO. 17: Did the Company analyze any other defined contribution plan
formulas that would incent longevity? If so, please provide the analysis. If not, why not?
REQUEST NO. 18: Please list any and all other types of defined contribution plans that
were considered as a par of the anual review of the retirement benefits package.
REQUEST NO. 19: Ms. Gerschultz states in her direct testimony (p. 19) that as she has
"looked at other utilties, it is clear that the Company's workforce structure has allowed it to avoid
many additional employee-related costs that other utilties incur and must pass on to customers."
Please identify all utilties reviewed and all costs that those utilties incur that Idaho Power does
not.
REQUEST NO. 20: Please provide a list of all studies or analyses completed relating to
the retirement benefits package review. Also provide a copy of each study/analysis or identify the
Production Request Response where it has been provided.
1 /7'#
DATED at Boise, Idaho, this ï - day of November 2010.
~oa.~J. WëB.sttzman ""
l) - Deputy Attorney General
Technical Staff: Terri Carlock
Donn English
i:umisc:prodreq/ipceIO.25wstc prod reql
FIRST PRODUCTION REQUEST TO
IDAHO POWER COMPANY 5 NOVEMBER 4,2010
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 4TH DAY OF NOVEMBER 2010,
SERVED THE FOREGOING FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY, IN CASE NO. IPC-E-IO-25,
BY MAILING A COpy THEREOF, POSTAGE PREPAID, TO THE FOLLOWING:
LISA D NORDSTROM
DONOV AN E WALKER
IDAHO POWER COMPANY
POBOX 70
BOISE ID 83707-0070
E-MAIL: lnordstrom(iidahopower.com
dwalker(iidahopower .com
GREG W SAID
TIMETATUM
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: gsaid(iidahopower.com
ttatum(iidahopower .com
--~SECRETA~
CERTIFICATE OF SERVICE