20060905_1657.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:CECELIA A. GASSNER
DATE:SEPTEMBER 1 2006
SUBJECT:CAPITOL WATER CORPORATION'
APPLICATION; CASE NO. CAP-06-
GENERAL RATE CASE
On June 21 , 2006, Capitol Water Corporation filed a general rate case application
seeking authority to increase its rates approximately 27.8%. If approved the Company
revenues would increase by $132 449 annually. Capitol Water provides service to approximately
875 customers in Boise, Idaho. The Company s Application includes proposed tariffs and
requests an effective date of August 1 , 2006.
On July 7, 2006, the Commission issued a Notice of Application. Order No. 30098.
In such Order, the Commission suspended the proposed effective date of the Company
proposed rates and ordered the Commission Staff to conduct an audit of the Application and
present its findings pursuant to such audit. Id. The Commission would then decide how it
wishes to process this Application.
THE APPLICATION
Capitol Water s Application states that since the entry of the final Order in its last
rate case, Order No. 26247 in Case No. CAP-95-, it has been necessary to implement certain
capital improvements. Application at 1. The Commission has authorized two surcharges to help
the Company meet its capital improvement needs , in June 1997 and July 2003. Id. See Order
Nos. 27022 and 29306.
To meet continued capital investment needs, the Company requests a revenue
requirement increase of $132,449 resulting in a percentage increase of approximately 27.8%.
Application at 2-3. The Company proposes to change the months subject to the summer rate
schedule to include the month of April, which would provide approximately $27 000 in
DECISION MEMORANDUM
additional revenue. Application at 3. The Company proposes spreading the remainder of the
requested additional revenue requirement across its customer classes, resulting in a 22.21 %
increase in base rates for all customers. Id.
STAFF RECOMMENDATION
The Staff has had an opportunity to review the Application and communicate with
the Company to clarify certain issues. In keeping with its findings, the Staff believes that
Modified Procedure would be the most effective way to process this matter. Upon conducting an
analysis of relevant issues inter alia including the revenue requirement and potential to install
meters, the Staff believes that each of these may be effectively and adequately discussed and
resolved through Modified Procedure.
The Staff recommends holding a public workshop to inform the Company
ratepayers about the Application, and respectfully suggests that such workshop be held
September 25, 2006. The Staff further recommends that a comment deadline of October 12
2006 and a reply comment deadline of October 26, 2006 be established.
COMMISSION DECISION
Does the Commission desire to process this matter by Modified Procedure? Does the
Commission desire to hold a public workshop on September 25, 2006? Does the Commission
desire to set deadlines for the submission of comments and reply comments of October 12 and
October 26, 2006, respectively? Does the Commission desire to establish a date for a public
hearing?
CECELIA . GASSNER
M:CAP-O6-cg2
DECISION MEMORANDUM