20190214Eagle Water to Staff 2-8.pdf

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Voice / Text : 208.453.610 6
E-Mail: Mollv @ BizCounselorAtlaw.com
14 February 2019
Ms. D. Hanian
Commission Secretary
ldaho Public Utilities Commission
P O Box 83720
Boise lD 83720-@7+
Hand Deliverd
RE: Case No. SUZ-MW2IEAC-W{8OI
Dear Ms. Hanian:
I am enclosing an original and three [3] copies of EAGLE WATER COMPANY, lNCs
RESPONSE TO TF|E COMMISSION STAFFS SECOND PRODUCnON REQUEST.
A portion of the document provided in response to the Saffs Request No. 2, and the entire
document provided in response to the Saffs Request No. 3 are filed under seal, pursuant to Rule
233 of the Commission's Rules of Procedure.
An additional copy of this filing is enclosed to be dat+stamped and returned for our files.
Very truly yours,
lra-
@hw, PLLC
B ]tC
@rtt L
MOLLY O'LEARY
BizCounselor@ Law, PLLC
1775W. Sate Street #150
BOISE, TDAHO 83702
208.453.5105
IDAHO BAR NO. 4995
Mol Iv @ BizCouonselorAtLaw.com
Attorneys for Eagle Water Company, Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE IO|NT APPLTCATTON
OF SUEZ WATER IDAHO AND EAGLE WATER,
COMPANY FOR THE ACQUISITION OF EAGLE
WATER COMPANY APPLICANT EAGLE WATER
COMPANY, INC'S RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCflON
REQUEST
COMES NOW, Applicant Eagle Water Company, lnc., by and through undersigned
counsel, and provides the following Responses to the Commission Staffs Second Production
Request.
REQUEST NO. 2: Please provide a copy of the "Original Agreement'' between Eagle
Water Company and H2O Eagle Acquisition, LLC dated May 14, 2018 as stated on page I
under "Definitive Asset Purchase Agreement."
RESPONSE TO REQUEST NO. 2: Please see the attached document marked, "Eagle Water
Company's Response to Commission Suffs Production Request No. 2." A portion of Section
2.O4 of the requested document has been redacted pursuant to IPUCRP 67, IPUCRP 233, the
ldaho Trade Secret Act, Title 48, Chapter 8, Idaho Code, and Title 74, Chapter 1, ldaho Code.
A CONFIDENTIAL copy of the un-redacted document has been filed with the Commission in
accordance with IPUCRP 233.02.
This Response was prepared by N. L. Bangle, President, H2O Eagle Acquisition, LLC.
EAGLE WATER COMPANYS RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST - |
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cAsE NO. SUZ-W-I*OZ|
EAG-W-I8-01
Telephone : [469) 458-027 O
Address: IBB W. State Street, Eagle, lD 83515
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Same
REQUEST NO. 3: Please provide a list of names of current Eagle Water Company
shareholders, date they became shareholders, and the number of shares they own.
RESPONSE TO REQUEST NO. 3: A CONFIDENTIAL copy of the requested information,
marked "Eagle Water Company's Response to Commission Saffs Production Request No. 3r"
has been filed with the Commission in accordance with IPUCRP 233.02. The information
provided is deemed confidential under IPUCRP 67 and IPUCRP 233; the ldaho Trade Secret
Act, Title 48, Chapter 8, ldaho Code; and the ldaho Public Records Act, Title 74, Chapter l,
ldaho Code.
This Response was prepared by Eagle Water Company attorney Molly O'Leary, based
on Eagle Water Company Corporate Minutes provided by Eagle Water Company shareholder
Barry L. Marcus.
B.L Marcus Telephone: [208) 3+2-3563
B.L. Marcus Address: 737 N 7th St, Boise, lD 83702
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Barry L. Marcus
REQUEST NO. 4: Please provide a list and detailed descriptions of the near term Eagle
Water Company system upgrades referenced by Robert DeShazo in Section X, on page 4 of
the Application. Within the description, please include any drivers necessitating the upgrade,
how the customer would benefit, and an estimate of the cost.
RESPONSE TO REQUEST NO. 4: Because of growth and the lack of proper booking
procedures in the past, as the recent PUC Staff audit brought to light, the more urgent
areas are:
a. Additional administration personnel, as well as additional field technicians are required
to support existing staff and company growth. Training is needed to improve the
knowledge base of field technicians and new staff. New administration staff, a certified
water technician and a Plant Superintendent is estimated to increase salary expense by
$|75,OOO - $200,000 per year.
b. Upgraded billing and processing systems, and necessary office computer upgrades are
estimated to cost the Company about $1851000, with maintenance and support being
about $25,000 annually.
EAGLE WATER COMPANYS RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST - 2
c. Beginning in early 2017, we began to install meters that would be compatible with a
radio-read system in both new construction and replacement units. To fully bring the
system on-line by replacing all non-radio read meters would cost an estimated
$1,700,000 using current dollars.
d. Some of our well sites require upgrades and refurbishing. Older generators need to be
replaced with modern, remote-controlled natural gas generators. Wells number 2and3
need to redrilled and the well sites need to be completely renovated with new pumps,
new well houses and new generators. AII well sites need upgraded security fencing and
security systems. The wells require a SCADA system to monitor well flows and system
issues. One pump station needs to be moved from private property owned by Robert
V. DeShazo, Jr. and placed on property owned by Eagle Water Company, Inc. Eagle
Water Company is in need of a 2 million gallon reservoir to serve as pressure
regulation and a back-up supply. The estimated costs for these much needed
renovations, upgrades and additions stand at about $515001000 in current dollars.
e. Our vehicles are older models as well as our miscellaneous support equipment. We
need to purchase 4 new vehicles within the next two years at an estimated cost of
$401000 per vehicle. Estimated support equipment replacements stand at about
$5,000 annually.
f. We require the use of contract engineering services for both short- and long-term
needs to develop short- and long-term infrastructure reinforcement plans and
construction budgets and day to day engineering responsibilities. The expected costs
are estimated to be about $150,000 per year.
This Response was prepared by Daryl Farnsworth, Eagle Water Company Operations
Manager, in cooperation with Robert V. DeShazo, Jr., Eagle Water Company President.
Telephone: [208] 939 -O2+2
Address: IBB W. State Street, Eagle, ID 83616
Record Holder [if different]: NA
Witness to sponsor testimony regarding: Daryl Farnsworth
REQUEST NO.5: Please provide a detailed description for all capital improvements
over $50,OOO made in the last 3 years. Details should include a narrative description of the
improvement, a description of the need[sJ driving the capital expenditure, and a breakdown of
the project costs.
RESPONSE TO REQUEST NO. 5:
There have been no capital expenses over $501000 in the past three years.
EAGLE WATER COMPANY'S RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST - 3
This Response was prepared by Daryl Farnsworth, Eagle Water Company Operations
Manager, in cooperation with Robert V. DeShazo, Jr., Eagle Water Company President.
Telephone: [208] 939 -O2+2
Address: IBB W. State Street, Eagle, lD 83515
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Daryl Farnsworth
REQUEST NO. 5: Please provide a detailed description for all planned capital
improvements exceeding $50,000 in the next 3 years. Details should include a narrative
description of the improvement, a description of the driver[s] for each project illustrating why
each are necessary, a cost/benefit analysis for each project, and a breakdown of the project
costs.
RESPONSE TO REQUEST NO. 5:
Due to capital restraints, Eagle Water Company has not hired an engineer to begin developing
a short- and long-term construction plan.
This Response was prepared by Daryl Farnsworth, Eagle Water Company Operations
Manager, in cooperation with Robert V. DeShazo, Jr., Eagle Water Company President.
Telephone: [208J 939-02+2
Address: IBB W. State Street, Eagle, lD 83615
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Daryl Farnsworth
REQUEST NO.7: Is Eagle Water Company involved in any lawsuits that may interfere
or affect the acquisition? lf so, please provide all information and documentation related to
each lawsuit and how it will affect the acquisition.
RESPONSE TO REQUEST NO. 7:
There are no current lawsuits.
This Response was prepared by Daryl Farnsworth, Eagle Water Company Operations
Manager, in cooperation with Robert V. DeShazo,Jr.,Fagle Water Company President.
Telephone: [208] 939 -0242
Address: l8B W. State Street, Eagle, lD 83616
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Daryl Farnsworth
REQUEST NO. 8: Are there any liens on any of the assets being acquired by SUEZ
Water ldaho through the acquisition? If so, please provide all information and documentation
related to each lien.
EAGLE WATER COMPANY'S RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST - 4
RESPONSE TO REQUEST NO. 8:
There are no known liens.
This Response was prepared by Daryl Farnsworth, Eagle Water Company Operations
Manager, in cooperation with Robert V. DeShazor,fr., Eagle Water Company President.
Telephone: [208] 939-0242
Address: lB8 W. State Street, Eagle, lD 83616
Record Holder [if differentJ: NA
Witness to sponsor testimony regarding: Daryl Farnsworth
DATED at Boise, ldaho, this l4'h day of February,2019.
@ ,PLLC
ttorney for Eagle Water Company, lnc.
EACLE WATER COMPANYS RESPONSE
TO COMMISSION STAFFS
SECOND PRODUCTTON REQUEST - s
Diane M. Hanian
Commission Secretary
Idaho Public Utilities Commission
472 West Washington Street
Boise, Idaho 83702
Sean Costello
Deputy Attorney Ceneral
ldaho Public Utilities Commission
472 West Washington Street
Boise, Idaho 83702
Attorney for IPUC
Robert V. DeShazo, Jr.
Eagle Water Company, lnc.
lB8 W. State Street
Eagle, ldaho 83515
Applicant
N.L. Bangle
H2O Eagle Acquisition, LLC
IBB W. State Street
Eagle, lD 83615
Applicant
EAGLE WATER COMPANYS RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTION REQUEST - 5
t I bv U.S. Mail
tXl bV Personal Delivery [Original er 3copies]
I I by Facsimile
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Diane.Hanian @ puc.idaho.gov
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[X] by E-Mail: [e-mail]
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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the l4th day of Februaryr 2Ol9, a true and correct
copy of the foregoing document was served on the following in the manner indicated:
MichaelC. Creamer
Preston N. Carter
Givens Pursley, LLP
601 W. Bannock St.
Boise, lD 83702
Attorneys for Applicant Suez
Water ldaho, lnc.
Marshall Thompson
Suez Water ldaho, lnc.
8248 W. Victory Road
Boise, ldaho 83709
Applicant
San Ridgeway
Mayor City of Eagle
55O E. Civil Lane
Eagle, lD 83616
lntervenor Gty of Eagle
B. Newal Squyres
Murray D. Feldman
Holland g Hart, LLP
P.O. Box 25ZI
Boise, ldaho 837O2-25n
Attorneys for lntervenor
City of Eagle
Norman M. Semanko
Parsons Behle 8t Latimer
BOO West Main Street, Suite l3OO
Boise, ldaho 83702
Attorneys for lntervenor Eagle
Water Customer Group
EAGLE WATER COMPANYS RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST -7
tl by U.S. Mail
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PrestonCa rter @ givenspu rslev.com
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[X] bv E-Mail: [e-mail]
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[X] by E-Mail: [e-mail]
mfeld man @ hollandhart.com
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[e-mail]
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SBerema n n @ citvofeaele.ors
Eagle Water Customer Group
8T7O W. Chaparral Road
Eagle, ID 83616
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[] bv Personal Delivery
[] by Facsimile
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lntervenor Eagle Water Customer
Group
Abigail R. Cermaine
Deputy City Attorney
Boise City Attorney's Office
l5O N. Capitol BIvd.
P.O. Box 5OO
Boise, ldaho 83701-0500
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Attorney for lntervenor, Crty of
Boise
City of Boise
l5O N. Capitol BIvd.
P.O. Box 5OO
Boise, lD B37O|-O500
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lntervenor
fames M. Piotrowski
PIOTROWSKI DURAND, PLLC
P.O. Box 2A54
lO2O W. Main Street, Suite 440
Boise, ID 83701
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Attorneys for lntervenor Citizens
Allied for lntegrity and
Accountability
Citizens Allied for Integrity and
Accountability
P.O. Box 2622
Eagle, ldaho 83516
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lntervenor
EAGLE WATER COMPANY'S RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTION REQUEST - 8
Brad M. Purdy Attorney at Lalv
2Ol9 N. l7'h Street
Boise, ldaho 83702
Attorney for lntervenor
Com m u nity Actio n Partnersh ip
Association of ldaho
EACLE WATER COMPANYS RESPONSE
TO COMMISSION STAFF'S
SECOND PRODUCTTON REQUEST - 9
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By: