HomeMy WebLinkAbout20071003Vol IV Hearing.pdfOR\G\NAL
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF UNITED WATER IDAHO INC. TO
AMEND AND REVISE CERTIFICATE OF
CONVENIENCE AND NECESSITY NO. 143
) CASE NO. UWI~W-07-
BEFORE
COMMISSIONER MARSHA SMITH (Presiding)
COMMISSIONER MACK A. REDFORD
COMMISSIONER PAUL KJELLANDER
PLACE:Cornmission Hearing Room
472 West Washington
Boise, Idaho
DATE:September 24, 2007
VOLUME IV - Pages 145 - 277
CSB REPORTING
Constance S. Bucy, CSR No. 187
23876 Applewod Way * Wilder, Idaho 83676
(208) 890-5198 * (208) 337-4807
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For the Staff:Scott Woodbury, Esq.
Deputy Attorney General
472 West Washington
Boise, Idaho 83720-0074
For United Water Idaho:McDEVITT & MILLER
by Dean J. Miller , Esq.
420 West Bannock StreetBoise, Idaho 83702
For the City of Eagle:MOORE SMITH BUXTON & TURCKE
by Bruce M. Smith , Esq.
and Susan E. Buxton , Esq.
950 West Bannock , Suite 520Boise, Idaho 83702
For Capital Development,
Inc. :MOFFATT THOMAS BARRET ROCK
& FIELDS
by Robert B. Burns , Esq.
101 South Capitol Blvd.
10th FloorBoise, Idaho 83702
CSB REPORTING
Wilder , Idaho
AP PEARANCE S
83676
WITNESS EXAMINATION BY
Mr. Burns (Direct-Cont'
Prefiled Direct Testimony
Prefiled Rebuttal Testimony
Prefiled Supp. Testimony
Mr. Woodbury (Cross)
Mr. Miller (Cross)Mr. Smith (Cross)Mr. Burns (Redi rect)
Mr. Smith (Direct)
Prefiled Direct Testimony
Prefiled Supp. Testimony
Mr. Woodbury (Cross)Mr. Burns (Cross)
Mr. Miller (Cross)
Commissioner Redford
Mr. Smith (Redirect)
Ms. Buxton (Direct)
Pre filed Direct Testimony
Prefiled Rebuttal Testimony
PAGE
145
147
152
161
178
181
184
199
202
213
224
229
236
247
250
252
254
257
264
J. Ramon Yorgason
(Capi tal Development)
Vern Brewer
(City of Eagle)
Mayor Nancy Merrill
(City of Eagle)
CSB REPORTING
Wilder, Idaho 83676
INDEX
Premarked
Admitted
Premarked
Admitted
Premarked
Admitted
Premarked
Admi tted
Premarked
Admi tted
Premarked
Admitted
Premarked
Admi t ted
Premarked
Admi tted
Premarked
Admi tted
Premarked
Admitted
Premarked
Admi t ted
Premarked
Admitted
PAGE
276
276
276
276
276
276
276
276
276
276
276
276
NUMBER DESCRIPTION
FOR CITY OF EAGLE:
201 - Properties Included in City
Planning for City Services
Annexation
202 - 2007 City of Eagle Comprehensive
Plan
203 - City of Eagle Water System
204 - City of Eagle System Development
Plan Map
205 - City of Eagle, Preliminary Plat
Staff Report
206 - Ordinance No. 623
207 - Annexation and Cooperation
Agreement
208 - E-mail from Bill Vaughan to Susan
Buxton with attached pictures
FOR CAPITAL DEVELOPMENT, INC.
301 - Eagle City Council Minutes,
May 22, 2007
302 - Annexation and Cooperation
Agreement
303 - E-mail from Bob Burns to Susan
Buxton, 8/8/2007
304 - E-mail from Bob Burns to Susan
Buxton , 8/16/2007
CSB REPORTING
Wilder , Idaho 83676
EXHIBITS
(Continued)
Premarked
Admitted
Premarked
Admitted
Premarked
Admitted
Premarked
Admitted
Admi tted
Admitted
PAGE
276
276
276
276
276
276
NUMBER DESCRIPTION
FOR CAPITAL DEVELOPMENT , INC.(Continued)
305 - E-mail from Bob Burns to Susan
Buxton , 9/13/2007
306 - Letter from Ken Sommer to Gene
P. Smith, P. E .
307 - E-mail from Bob Burns to Susan
Buxton, 6/7/2007
308 - Confidentality and Non-Disclosure
Agreement
311 & 317
FOR UNITED WATER IDAHO INC.
1 - 5
CSB REPORTING
Wilder, Idaho 83676
EXHIBITS
BOISE , IDAHO, MONDAY , SEPTEMBER 24 , 2007, 1: 40 P.
COMMISSIONER SMITH:All right, we will go
back on the record.Before we broke for lunch , Mr. Burns
was identifying his witness and we have all been provided
wi th properly marked exhibits for Mr. Yorgason , so please
proceed.
MR. BURNS:Thank you.
J. RAMON YORGASON,
produced as a witness at the instance of Capital
Development, Inc., having been previously duly sworn
resumed the stand and was further examined and testified
as follows:
DIRECT EXAMINATION
BY MR. BURNS:(Continued)
Mr. Yorgason, with the substitution of
Exhibi ts No. 301 through 308 which we did just before
lunch , is your testimony that's contained in your
supplemental submissions, your direct rebuttal testimony
and your supplemental direct testimony or direct
supplemental testimony that we described before lunch, to
CSB REPORTING
Wilder , Idaho
145 YORGASON (Di )
Capi tal Development83676
your knowledge, is it true and correct and accurate to
the best of your knowledge at this time?
Yes, it is, to the best of my knowledge.
MR. BURNS:I would ask , then, to spread
the testimony of Mr. Yorgason on the record and make him
available for cross-examination.
COMMISSIONER SMITH:If there s no
obj ection , we will spread the prefiled testimony of
Mr. Yorgason as identified earlier upon the record as if
read and Exhibits 301 through 308 are identified.
(The following prefiled direct, rebuttal
and supplemental testimony of Mr. J. Ramon Yorgason is
spread upon the record.
CSB REPORTING
Wilder , Idaho
146 YORGASON (Di)
Capi tal Development83676
I am the President of Capital Development Inc.
an Idaho Corporation.Capi tal Development Inc., is the
developer of the Lanewood Estates development, which is
the subj ect of this proceeding.I have been engaged in
the business of residential real estate development in
Ada County, Idaho for over 30 years, and make this
affidavi t of my own knowledge.
I have reviewed the Letter Comments of the City
of Eagle dated February 23 , 2007 (Letter Comments) and
make this Affidavit in response to certain statements
therein.
We have made application to Ada County for
approval of our Lanewood Estates development.The County
has completed its initial staff review and provided
comments on the application.We have responded to those
comments and are awaiting the completion of the second
staff review and scheduling of the initial public
hearing.We expect to complete the
147 J. RAMON YORGASON (Di )
Capital Development
hearing process with the County and receive approval for
our development by May 2007, and to start construction of
the first phase in July 2007.
The Letter Comments (Pg 2.) assert that the
Ci ty of Eagle s main line will be ready for use by
Lanewood Estates by the time it completes the local
government approval process.However , United Water
already has a functioning 12-inch water main in Linder
Road immediately adj acent to our proj ect.Based on the
foregoing and my understanding of the location of
existing City facilities, it is highly unlikely that the
Ci ty would be able to extend its facilities, including
having an active well completed and connected to its
water deli very system , by the time we will have approvals
to commence construction.It is also exceedingly
unlikely - if not impossible - that we would have
approvals from the City to start construction by this
summer if the City were to hear and decide the
subdivision application for our Lanewood Estates
development.In fact , in one of our prior City of Eagle
subdivisions (Countryside Estates), we were delayed
approximately two years and it took nearly three years to
get approvals because the various affected agencies could
not come to an agreement.
In addition to the issue of ability to provide
148 J. RAMON YORGASON ( Di )
Capi tal Development
timely interconnection of the Lanewood Estates
development , Capital Development Inc. desires to obtain
water service from United Water because:
The review and approval process is shorter using
Uni ted Water.Normally, DEQ approval is required for all
subdivisions before construction can begin (upon approval
of the water system , DEQ lifts sanitary restrictions and
approves construction).This process is shortened by
using United Water.Currently, DEQ allows United Water
to independently lift sanitary restrictions to start
construction (DEQ does not need to independently review
and approve United Water s water delivery systems). DEQ
does not have the same arrangement with
149 J. RAMON YORGASON (Di)
Capi tal Development
the City.DEQ and the City s outside engineer must both
approve Eagle City water plans, meaning that the review
and approval process will result in a delay of at least
three months;
Any delays in starting construction will be VERY
expensive.We have currently paid for approximately half
of the land for our Lanewood Estates development.The
interest payment to hold that portion of the land is
nearly $76,000.00 per month.In July, we are
contractually obligated to purchase the remainder of the
property (more acres than the first takedown, with a
higher per acre price) Our interest payment to hold the
land will more than double to an amount in excess of
$160,000.00 per month.We cannot afford even the chance
of being delayed waiting for the City to get its water
system operational; and
Because the City is just now in the process of
establishing its municipal water system, there can be no
certainty or assurance that it will be able to accomplish
all that it must do to provide water service to the
Lanewood Estates development.In this regard, because
Capi tal Development Inc.' s property is not located wi thin
the City, Capital Development Inc. should be not be
exposed to the risk and uncertainty arising out of the
Ci ty I S current desire to enter into a new and complex
150 J. RAMON YORGASON (Di )
Capi tal Development
venture: the establishment, construction and operation of
a municipal water system.
151 J. RAMON YORGASON (Di)
Capi tal Development
Please state your name and identify your
posi tion with Intervenor Capital Development Inc.
My name is J. Ramon Yorgason, and I am the
president of Capital Development, Inc.
Are you the same Ramon Yorgason who provided
direct testimony in this proceeding?
Yes.
What is the purpose of your rebuttal testimony?
I would like to respond to certain statements
contained in the direct testimony of Mayor Nancy Merrill
and of Vern Brewer.
Mayor Merrill, at pages 3-4 of her direct
testimony, and Vern Brewer, at pages 2-3 of his direct
testimony, have expressed concern that your Lanewood
Estates development conform with the City of Eagle
comprehensive plan.Do you know whether your development
application to Ada County is in substantial compliance
wi th Eagle s comprehensive plan, as well as its planning
and zoning requirements?
Yes, it is.We have undertaken a review of our
Ada County application to determine its compatibility
wi th Eagle s comprehensive plan and its planning and
zoning requirements and believe our Lanewood Estates
development both substantially complies with Eagle
requirements-other than with respect to who would provide
152 Yorgason , Di-Reb
Capi tal Development
water service to the development-and would be approved by
Eagle with but possible minor revisions if our property
were annexed by it.
153 Yorgason , Di-Reb
Capi tal Development
Has the City of Eagle initiated annexation
proceedings with respect to your Lanewood Estates
development?
No.Al though we have been invited by
representatives of the City of Eagle to request
annexation , Eagle has neither initiated annexation
proceedings itself nor requested our consent to its
annexation of our property.
At pages 6-7 of his direct testimony, Vern
Brewer expressed concern that allowing United Water to
serve the Lanewood Estates development would frustrate
completion of Eagle s water system and associated
services.Is this a legitimate concern?
I believe Mr. BrewerI don t think so.
primary concern has to do with the extension of a 16"
water main through the Lanewood Estates development.
This water main can obviously be extended through
Lanewood Road already, and I also have no problem with
Eagle extending the water main beneath the streets of our
development if Eagle will construct the main in
conj unction with the orderly improvement of our proj ect.
Capi tal Development Inc. will provide Eagle with an
easement to this effect, if it requests one.
Do you have a response to Mr. Brewer
addi tional concern that excluding Lanewood Estates from
154 Yorgason , Di-Reb
Capi tal Development
Eagle s system would raise the cost of storing water to
the remaining residents of Eagle?
Yes.Eagle should reduce the size of its
planned storage reservoirs and related improvements to
accommodate the reduced number of users of Eagle
services resulting from United Water s service of the
Lanewood Estates development.By doing so, those
connected to Eagle s system will pay for only
155 Yorgason, Di-Reb
Capital Development
those lesser improvements they use, and the residents of
Lanewood Estates will not be asked to subsidize the
residents of Eagle.
Do you have a concern that the residents of
Lanewood Estates might be required to subsidize the
residents of Eagle?
Yes, I do.I have been advised by legal
counsel that because our property is not wi thin the city
boundaries of Eagle, Eagle would have the right under the
law to discriminate in multiple respects against those
Ii ving in Lanewood Estates, such as by charging them more
for water or limiting service in the event of a water
shortage.In fact, I was advised that Section 6-4G of
the Eagle Municipal Code specifically provided for the
preferential treatment of the residents of Eagle with
respect to water service until last month when it was
amended because of this PUC case.Of course, Eagle can
also amend its municipal code again as soon as this PUC
case is decided, or at any time later, to discriminate in
any manner it chooses without recourse by me or the
future residents of Lanewood Estates or the PUC.That
concern is part of the reason I asked United Water-which
I have found to be a tested and reliable provider whose
rates and services are regulated by the PUC-to provide
water service to Lanewood Estates.
156 Yorgason , Di-Reb
Capital Development
What other reason did you have for asking
Uni ted Water to provide water service to Lanewood
Estates?
Al though both Mayor Merrill and Mr. Brewer have
testified about the anticipated construction of the
necessary improvements to Eagle s water system for Eagle
to timely serve Lanewood Estates, Mr. Brewer admits in
his
157 Yorgason, Di-Reb
Capi tal Development
direct testimony at page 3 that Eagle does not have
established water rights to provide this service and that
Eagle s pending applications for such water rights have
been protested.Thus, even assuming Eagle s pending
applications are initially approved, a judicial appeal
could deprive the City of Eagle of the necessary water
rights to provide water service for an indeterminate
period , and perhaps forever.Considering the fact that
we are currently paying $76,000 a month in interest on
our purchase of the first half of the land and, as a
resul t of our recent negotiations with the seller of the
property, will be paying more than double that amount as
we take down the second half of the land in two
increments over the next two years, we simply cannot
afford to run the risk that Eagle s hopes with respect to
getting its water system operational this summer will
prove unfounded.
Finally, Mayor Merrill also expressed concern
at pages 2-3 of her direct testimony that the City of
Eagle will be adversely impacted by your Lanewood Estates
development because the residents of the development will
use the amenities that Eagle offers.What is your
response to this concern?
As I earlier indicated, Lanewood Estates will
be developed in substantially identical form whether or
158 Yorgason, Di-Reb
Capi tal Development
not it is annexed by the City of Eagle.Accordingly,
whether United Water or Eagle provides water
service-which is really what the present controversy is
all about-the impacts on Eagle will be the same.
Further, the principal impacts of our proposed
development will be on the roads, sewers, schools, and
fire and sheriff's departments, and the City of Eagle is
not responsible for any of these "amenities.Finally,
if Eagle wants the residents
159 Yorgason, Di-Reb
Capital Development
of Lanewood Estates to be residents of the City of Eagle,
Eagle can always annex their property.
160 Yorgason, Di-Reb
Capi tal Development
Please state your name and identify your
posi tion with Intervenor Capital Development Inc.
My name is J. Ramon Yorgason, and I am the
president of Capital Development, Inc.
Are you the same Ramon Yorgason who provided
both direct and rebuttal testimony in this proceeding?
Yes.
What is the purpose of your supplemental
testimony?
I would like to provide the Commission with
those documents and related testimony pertaining to the
terms and status of the agreement that was reached
between Capital Development and the City of Eagle
concerning the pending application of United Water Idaho
Inc.
Before turning to the agreement itself , can you
tell me whether the intent of your agreement with Eagle
has been summarized in the official records of the City?
The intent was explained and set forth Yes.
the Minutes of the Eagle City Council attached as Exhibit
301 on page 8, where Eagle s city attorney, Susan Buxton
summarized the terms of the agreement I had reached with
the Eagle City Council.
The Minutes state on page 9 that Ms. Buxton
explained to the Eagle City Council as follows:
161 Yorgason, Di-Sup
Capi tal Development
The developer would agree to have the PUD
served by the City Water System in compliance
wi th Eagle
162 Yorgason, Di-Sup
Capital Development
Ci ty Ordinances and if at the time the Lanewood
PUD needs hook up to public water system
and the City system not available
then the PUC matter would be reinstated with
regard to whether that area should be served as
part of the United Water certificated area.
Is this an accurate summary of the intent of your
agreement with Eagle?
Yes, with one modification it is.
Was this intent incorporated into the written
agreement you and Eagle executed?
Yes it was.A copy of the agreement between
Eagle and Capital Development is attached as Exhibit 302
and the intent articulated by Mrs. Buxton with the
modification I mentioned was expressed and implemented
through four provisions contained in the agreement.
Would you please identify each of these four
provisions and explain its relevance.
The first provision is contained in the last
sentence of the Preliminary Statement where Eagle
acknowledges that the reason it had previously contested
both Capital Development's development applications with
Ada County and United Water s application with the PUC
was "based principally on Eagle s determination that it
will obtain in the near future those water rights
163 Yorgason , Di-Sup
Capi tal Development
necessary to provide water service " to Lanewood Estates.
What were you told about those water rights?
164 Yorgason, Di-Sup
Capital Development
I was assured on several different occasions by
Mayor Merrill , who is a personal friend, that Eagle would
have these essential water rights first in May and then
in June of this year.
To your knowledge, has Eagle obtained the
necessary water rights?
Not to my knowledge, and my attorney has
repeatedly asked for evidence that these water rights
exist.For instance, by his August 8, 2007 , e mail to
Mrs. Buxton attached as Exhibit 303, my attorney asked
for an explanation with respect to whether the water
rights that were tentatively awarded to Eagle and are now
being challenged could even be used to service Lanewood
Estates.We have received no response to this inquiry.
And by his August 16, 2007 , e mail to Mrs. Buxton
attached as Exhibit 304, my attorney provided Eagle with
our development schedule for Lanewood Estates and
explained to Mrs. Buxton why based on the attached
schedule Capital Development had no al ternati ve but to
forward with this PUC application.Further, when Mrs.
Buxton called my attorney in response to Exhibit 304 and
asked what Eagle might do, my attorney suggested that
Eagle provide Capital Development with an unconditional
will-serve letter or other reasonable documentation
establishing Eagle s ability to provide water service to
165 Yorgason, Di-Sup
Capi tal Development
Lanewood Estates.As referenced in my attorney s very
recent e mail to Mrs. Buxton of September 13, 2007
attached as Exhibit 305, we are still waiting for such
documentation.
What is the second of the four provisions
contained in your agreement with Eagle that expresses and
implements the intent as stated in the City of Eagle
Minutes (Exhibit 30l)?
166 Yorgason, Di-Sup
Capi tal Development
The second provision is contained in the "NOW,
THEREFORE" clause of Exhibit 302, where it states that
the purpose of the agreement was to allow for the
orderly development of the Property without undue and
costly delay, and provide for United Water s service of
water to the Property in the event Eagle is unsuccessful
in obtaining the water rights it requires to service the
Property. .
. . "
Is your development of Lanewood Estates
currently being delayed?
Ada County approved the developmentYes.
applications for Lanewood Estates on July 11, 2007, and
the appeal period for the approval expired 28 days later
in August.Further , because no grading permit is
required and our drainage plans were approved by Ada
County as is reflected in Exhibit 306, we would start
grading today if we knew that we had water.
Why can t you start grading today anyway?
It would be financial Russian roulette to start
the construction of millions of dollars in improvements
wi thout knowing that we will have the water necessary to
complete the improvements and sell lots and homes.
Because Eagle s water rights are being challenged and
protested, it could conceivably be years before Eagle has
the necessary water rights to service our development.
167 Yorgason, Di-Sup
Capi tal Development
In sum, not only would the interest costs on the
constructed improvements be enormous if we couldn t get
water, but we might lose our property to foreclosure by
our lender by incurring construction costs that we
couldn t recover through sales.
168 Yorgason, Di-Sup
Capi tal Development
But couldn t you also lose your property to
foreclosure to your lender if you don I t start
construction?
Yes.Because we are incurring interest at the
rate of $76,000 a month, we have got to get Lanewood
Estates under construction, but increasing the amount
borrowed and the resulting interest carry without having
assurance of water would make it more likely that we get
in trouble with our lender , not less likely.
Okay.What is the third of the four provisions
contained in your agreement with Eagle that expresses and
implements the intent as stated in the City of Eagle
Minutes (Exhibit 301)?
The third provision is contained in Section 1
of Exhibit 302, where it states that we would "continue
the hearing of United Water s Application currently set
for May 24 , 2007 , to the first available date after
August 24, 2007.
What is the significance of this provision?
August 24 was the latest I possibly could wait
until having to again ask the Commission to grant United
Water s application , so that I would not be delayed until
after winter to pave the proj ect; and I made the
importance of this date clear to Eagle.In fact, before
agreeing to the August 24 deadline, Eagle asked that the
169 Yorgason, Di-Sup
Capital Development
date be extended from June 30 to the end of July and then
finally to August 24, so that Eagle could have all the
time that I could possibly give it to obtain the water
rights it was counting on getting to serve Lanewood
Estates.
170 Yorgason, Di-Sup
Capi tal Development
What then, is the last of the four provisions
contained in your agreement with Eagle that expresses and
implements the intent as stated in the City of Eagle
Minutes (Exhibit 301)?
The fourth provision is contained in Section
4 (d) of Exhibit 302, which states that "Eagle shall not
adopt an ordinance annexing the Property until water
service has been provided to the boundary of the Property
for delivery of water.
What is the significance of this provision?
The provision was intended to ensure that Eagle
would not obtain any jurisdiction over Lanewood Estates
unless and until Eagle obtained the water rights
necessary to provide water service to the property-which
to my knowledge Eagle has not done and may not do for
months or even years.
You testified that the intent of your agreement
as articulated in the City of Eagle s Minutes (Exhibit
301) was modified somewhat.Can you explain how?
Yes.Exhibit 302 was revised and executed on
May 23, 2007 , the day after Mrs. Buxton explained the
intent of the proposed settlement contained in Eagle
Minutes.As I previously stated, the agreement with
Eagle that was negotiated gave Eagle until August 24 to
obtain the water rights necessary to provide water
171 Yorgason , Di-Sup
Capi tal Development
service to Lanewood Estates.I never agreed that Eagle
would have until after I had constructed the water system
for the proj ect to obtain the necessary water rights.
Nor for the economic reasons previously discussed would
172 Yorgason, Di-Sup
Capi tal Development
I ever agree to first construct substantial improvements
and then pray somebody could provide water.
Didn t you agree in Exhibit 302 to file an
application for annexation promptly following Ada
County s approval of your development applications, which
became final in August?
Yes, we did.
Have you filed an annexation application with
Eagle?
Yes, we filed an annexation application with
Eagle today.
Why didn t you file an annexation last month?
In simple terms, I overlooked the matter and
nobody at Eagle even raised the issue until last week,
when Mrs. Buxton sent her September 13, 2004, letter to
my attorney.
Did Eagle ever overlook any of its obligations
to you under your agreement?
As provided in Section 1 of Exhibit Yes.
Eagle was obligated to provide Capital Development with
wri tten status reports every two weeks.But as
established by my attorney s e-mails of June 7 , June 25,
and August 7 attached as Exhibit 307 , my attorney had to
send repeated requests to Mrs. Buxton to obtain these
reports.
173 Yorgason, Di-Sup
Capi tal Development
To your knowledge, has Eagle been harmed in any
way by the delay in the filing of Capital Development'
annexation application?
No, and considering the proscription on Eagle
annexing our property under Section 4 (d) of Exhibit 302
it is inconceivable to me that Eagle
174 Yorgason , Di-Sup
Capital Development
suffered any more detriment by our submission today, than
Capi tal Development did by Eagle s delay in submitting
several of its written status reports.
Eagle has pointed to the confidentiality
agreement attached as Exhibit 308 that you entered into
wi th United Water as evidence that you were conspiring
wi th United Water against Eagle.Were you?
No, and the allegation is insulting and absurd
for two reasons.First, my agreement with Eagle
specifically provides that United Water could provide
water service to Lanewood Estates if Eagle couldn
obtain the water rights it needed by August 24.Second,
because my agreement with Eagle provides for concessions
by Eagle-including the waiver of certain filing fees, the
expedi tious review and processing of certain plans and
applications, and the preparation and submission of
written status reports-the very purpose of the
confidentiality agreement was to protect Eagle
interests by keeping the terms of the agreement between
Capi tal Development and Eagle out of the hands of other
developers, who might ask for similar concessions from
Eagle.
Mr. Yorgason, to your knowledge, is Eagle
ready, willing, and able to provide water service to
Lanewood Estates?
175 Yorgason, Di-Sup
Capi tal Development
Certainly not to my knowledge, and as I earlier
indicated, my attorney has repeatedly asked Eagle to
provide reasonable evidence that it has the necessary
water rights, without success.
One final question.Based on the foregoing, do
you and Capital Development want United Water to provide
water service to Lanewood Estates?
176 Yorgason , Di-Sup
Capital Development
Yes, we desperately need water , and United
Water is the only purveyor that actually has the water
rights to service Lanewood Estates.
177 Yorgason , Di-Sup
Capi tal Development
open hear ing .
(The following proceedings were had in
COMMISSIONER SMITH:Mr. Miller , do you
have any questions of Mr. Yorgason?
BY MR. WOODBURY:
MR. MILLER:I do not, Madam Chairman.
COMMISSIONER SMITH:Thank you.
Mr. Woodbury?
MR. WOODBURY:Thank you, Madam Chair.
CROSS-EXAMINATION
Mr. Yorgason, it's my understanding that
you received the county plat approval on July 11th of
CSB REPORTING
Wilder , Idaho
That is correct.
COMMISSIONER SMITH:Is your microphone
2007.
MR. WOODBURY:Yes.
BY MR. WOODBURY:Is that correct?
on?
Yes.
And did you identify a water provider in
We provided two water providers, but
through the county we told them we thought it was going
that application?
178 YORGASON (X)
Capi tal Development83676
to be United Water and they accepted that.
They accepted United Water?
Yes, that's my understanding.
That's reflected in their approval?
That is correct.
And you have -- looking at your direct
testimony, you have some familiarity with the City
annexation process?
We work with a lot of cities, but I '
somewhat familiar with the process.
Okay, and do you believe that Capital
Development has provided the City with all the
information required to process your annexation
request?
We have provided them all the information
they ve asked for.ve applied for annexation and
given them our construction plans.
Okay.In your supplemental testimony, you
attempt to tie the annexation and cooperation agreement
to the City minutes.You would agree, though, in
paragraph 7 of the agreement, that reflects that the
agreement itself wi thin the four corners constitutes the
final and entire expression of the parties and supersedes
all prior agreements?
That is our agreement.
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179 YORGASON (X)
Capi tal Development83676
Yes, and was that agreement executed
were there multiple copies because the agreement that'
part of the testimony doesn t seem to have a date next to
the signatures?
I don t know.I know the agreement was
hammered out at 1: 00 0 ' clock in the morning or the bulk
of it.I don t know the answer to that.
Okay, the agreement on the final page does
indicate it's executed as of the date indicated opposite
each of the signatures below, but it doesn t seem to
indicate any date, but you indicated in your, I guess,
supplemental testimony that it was executed on May 23rd,
the date prior to hearing in this matter in May?
To the best of my knowledge.
On page 4 of your supplemental, you state
that my attorney suggested that Eagle provide Capital
Development with an unconditional will-serve letter or
other reasonable documentation establishing the City
abili ty to provide water service to Lanewood.Is it your
experience, I guess, that the City of Eagle has
previously granted unconditional will-serve letters?
m not aware of any condition or any
other proj ects where there has been so much confusion of
whether or not they had water , so I don t know if they
have or not.
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180 YORGASON (X)
Capi tal Development83676
But is it my understanding, though, that
the City refused to provide that type of letter to you?
CSB REPORTING
Wilder, Idaho
That is my understanding.
MR. WOODBURY:Madam Chair , Staff has no
further questions.Thank you.
COMMISSIONER SMITH:Thank you , Mr.
Woodbury.
MR. MILLER:Madam Chairman.
COMMISSIONER SMITH:Mr. Miller.
MR. MILLER:I forgot I actually did have
a couple of questions.
proceed.
BY MR. MILLER:
COMMISSIONER SMITH:You do?Please
MR. MILLER:Wi th your indulgence.
CROSS-EXAMINATION
Just very quickly, sir.In your first
affidavi t or first testimony, you indicate that you have
been engaged in residential real estate development in
Ada County for over 30 years?
That's approximately correct, just over
During the course of that long period of
years.
181 YORGASON (X)
Capi tal Development83676
being engaged in this business, have you had occasion to
be a customer of United Water Company?
On many occasions.
Based on that experience, is it your
belief that United Water Company has the managerial and
other capabilities to successfully operate a domestic
water system and provide service to its customers?
They have always provided good water
service to us when they were in the area where we needed
water for our subdivisions.
And with respect to the Lanewood proj ect,
is it your -- based on your examination of the
circumstances, is it your understanding that United Water
is prepared to immediately provide service to the
Lanewood development?
Yes, they re immediately there and have
water there.
MR. SMITH:I want to obj ect to that as
lacking any kind of foundation for this witness to
testify to that.
COMMISSIONER SMITH:Mr. Miller.
BY MR. MILLER:Mr. Yorgason, would you
explain to the Commissioners what you have done to
examine the ability of United Water to provide service to
the Lanewood development in terms of your investigations
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Wilder , Idaho
182 YORGASON (X)
Capital Development83676
and so on?
We have talked with them.Yes.They have
given us information about where their water main is.
It's adj acent or next to, just directly adj acent to our
They ve expressed to us they have the capacityproperty.
and the ability to serve our proj ect, and we have seen
nothing that would stand in the way short of receiving
approval here at this venue.
Based on that evaluation , is it your
understanding and impression that United Water has the
ability to immediately provide service to the
development?
Yes.
MR. SMITH:And I'm going to obj ect
that question as lacking foundation as well.
Mr. Yorgason testified that it was -- and it's also a
hearsay obj ection.Mr. Yorgason is basing his testimony
on some undescribed conversation with United Water saying
that he believes that they have the ability to serve.
has added no foundation to justify that kind of
conclusion.
COMMISS lONER SMITH:Mr. Miller.
MR. MILLER:ll submit it to the
Commission for your ruling on that.
COMMISSIONER SMITH:All right.I guess
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183 YORGASON (X)
Capital Development83676
ll just take it as his opinion and the Commission
based on the evidence provided in this hearing may form
its own opinion.
MR. MILLER:But you are willing to
consider his?
COMMISSIONER SMITH:Well , his opinion is
what it is based on what he knows, so we ll give it the
appropriate weight, how is that?
MR. MILLER:So the record can reflect
that it is his opinion that United Water is capable of
immediately serving?
COMMISSIONER SMITH:Yes.
MR. MILLER:Very good.Those were the
questions I forgot to ask.Thank you.
COMMISSIONER SMITH:Thank you.
Mr. Smith.
CROSS-EXAMINATION
BY MR. SMITH:
Mr. Yorgason , when will you have some lots
available for sale?
fast can get water.
desperate get water and we just been delayed and
delayed and we just desperate.Just fast can
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184 YORGASON (X)
Capi tal Development83676
get water, we ll be under construction and it will take
as short a period as humanly possible to get it
constructed, barring weather, and the way we re getting
delayed, it still could be in November, it could be next
spring, depending on how many delays.It could be
several months after that, depending on what kind of
delays we continue to have.
So you don t have a date in mind on which
you could sell lots?
November.
November?
Uh-huh, that's lots.
How many?
Approximately 20.ve continued to chop
the si ze of our first phase down so we could do it
faster, because our delays have just been horrendous to
us, just devastating.
When you acquired the property to be
developed as Lanewood, you knew it was in the area of
impact of the City of Eagle, didn t you?
Somewhere in the process I knew it was
close to Eagle and would be someday involved in Eagle.
don t know that I knew when we bought it if it was in the
area of impact , but we knew eventually it would -- we
suspected eventually it would be in Eagle and the entire
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185 YORGASON (X)
Capi tal Development83676
area probably would be.
Do you have any idea when you learned that
it was in the area of impact?
CSB REPORTING
Wilder, Idaho
I don t have that date.
Was it prior to the time that you
approached United Water about serving?
We talked with Eagle, the staff at Eagle,
and they explained to us prior to the time we talked to
Uni ted Water, that's correct, so it was prior to the time
we talked to United Water and then we learned that there
was problems getting water, so that's when we went to
And you said we learned there were
problems getting water, would you expound on that,
Yes, we had understood that they did not
have a certificate for their water, that Eagle did not
have a certificate, a water certificate.
How did you learn that?
I believe it was through our engineer , but
I don t have that -- we talked to a lot of people and
believe it was our engineer that shared that with us.
Are you aware that the City of Eagle does
have water rights?
m aware they re claiming they have water
Uni ted Water.
please?
186 YORGASON (X)
Capi tal Development83676
rights.
But you re not aware that the City does
have existing water rights?
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Wilder, Idaho
They have water rights for some places in
the City.I I m not aware of water rights that will serve
But if the City does have water rights to
serve this property, you re not aware of that?
not aware
--
would you restate the
If the City does have water rights that
would allow service to this area, you aren t aware of
I don t have personal knowledge of a water
right that will serve this area that's an approved water
Okay, and the agreement that Mr. Woodbury
referred to between you, "between you " being Capital
Development, and the City, that agreement called for the
Ci ty to withdraw its obj ections to your applications at
the county, did it not?
That is correct.That is my
And the City did that, didn t they?
That is correct.
this property.
question, please?
that, are you?
right.
understanding.
187 YORGASON (X)
Capi tal Development83676
And they did that immediately upon
execution of that agreement, didn t they, wi thin a day or
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Wilder, Idaho
Yes.I don t know the date, but yes, they
two?
Okay, and did you file or did Capital
Development file an annexation application with the
Yes.
When did you that?
Last week.
On September 17th; correct?
That's approximately correct.It was just
Okay, and you did that because the City
as ked you to follow through with your end of the
agreement, didn t they?
That is correct.As soon as they brought
did.
it to our attention, we filed it immediately and we also
provided all the plans immediately.
What plans did you provide?
The construction plans, including the
When did you provide the water plans?
A week ago, same time.
Ci ty?
about a week ago.
water plans.
188 YORGASON (X)
Capital Development83676
week ago?
So you provided water plans to the City a
That is correct.
Did you personally do that?
No.
Who did that?
My son it.
And your son being?
David Yorgason.
Okay.When you or Capital Development and
the City executed this agreement, did you provide a copy
of that agreement to the county?
I don t know.I don t know.If they
asked for it, we probably would have, but I don t know if
they asked for it.We try and keep agreements pretty
close in, so we don t typically take agreements someplace
if someone doesn t ask for them.
And as I read your testimony, and correct
me if I'm misinterpreting it, you signed the
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Wilder, Idaho
confidentiali ty agreement with United Water in order to
protect the City; is that correct?
We signed the confidentiality -- when we
were talking to United Water, we asked them to not
disclose or not discuss the agreements that we had.The
outcome of that was a confidentiality agreement with
189 YORGASON (X)
Capi tal Development83676
Uni ted Water and also with the City, and the question has
come up since then why does that help the City.Well,
there are certain things in the agreement the City agreed
to give to us , waiver of certain fees, expeditious review
of our plans, those types of things.If other developers
saw it, if it wasn t held confidential and other
developers saw it, they may be upset with us or the City,
so we feel it's appropriate to keep those agreements in a
close circle, but we didn t do it just to protect the
Ci ty, but that was part of the outcome , evidently.
So did you not think it was important to
let the City know that you entered into that
confidentiality agreement?
It was just with United Water.It was our
agreement with United Water.The outcome was that it
also protected the City, but we didn t do it for that
purpose.
You didn t do it for the benefit of the
Ci ty?
Not the sole purpose of the City.
Okay, but you would agree with me, would
you not, that that agreement provided for the City to
provide -- the intent was for the City to provide
services to the development?
If they could provide water and they
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Wilder, Idaho
190 YORGASON (X)
Capi tal Development83676
wanted to.I fully believe they probably wanted to as
bad as we wanted to, but just things beyond on their
control they weren t able to and still aren t in our
opinion, and so yes, they wanted to, we wanted them to,
it just didn t happen.I mean , it's delayed from May
24th to June 24th to July 24th and they said what's the
last date you need water , you know, if you re going to
get water and we said if we can know by August 24th, we
can still get it done, so we set that as a date for our
hearing, not realizing that when we come back later and
say well, we re not going to quite make it , we re going
to have to have a hearing, then it pushes us off another
30 days until September 24th and it really hammers us to
try and get construction in by this fall.
Our expenses are just horrendous on this
proj ect.It's a huge proj ect and very high expense.The
cost of the land is very high and it's just -- we
desperate to get water and that's all we want is water.
We don t really care where it came from, but we can
just wait in hopes that somebody can provide water and we
can t put water in, all of our pipes in , and then find
out you don t have it several months later and then we '
really stuck, so we had to know before we can start
construction.We have to know where the water is coming
from.
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Wilder, Idaho
191 YORGASON (X)
Capital Development83676
Under that agreement with regard to the
submission of water plans to the City
Yes.
-- if you were so concerned about the
supply of water to the development by the City, why
didn t you submit your water plans to the City before
September 17th?
Well , two or three reasons.As we were
going forth and realized from our perspective that there
was no way that they re going to have water , then we went
wi th the county, because we knew if we went with the
county, United Water was right there.The subdivision is
basically the same whether it's the City or the county,
it's the same project, it's the same density, it's the
same layout.We meet the City conditions, so it's the
same subdivision.
Eventually, I hope it's in the City, I
think it will be, but we have to have water and we can
go laying water lines with the hope that we re going to
have water, and then with people beyond our control,
beyond Eagle s control, coming out here and protesting
and possibly holding us in court for possibly years or at
least months and months and months as has already
happened, I mean , I'm sure Eagle never dreamed it would
take this long and we didn t dream it would take this
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Wilder, Idaho
192 YORGASON (X)
Capi tal Development83676
long, but we can t move forward with a hope.It's like
playing Russian roulette.You re going to put a lot in
the gun and you hope you get the right bullet.I just
can t do it.I mean, the expenses are just too
horrendous.
But those -- well, strike that.You
testified that -- I obj ect to the question and answer --
but you testified that you are , I guess, assured that
Uni ted Water can serve; is that correct?
Uni ted Water is right at the proj ect and
we know physically they can get us water.Now , they have
to go through this process and get it approved and so,
again , we can t start construction, same thing, but they
have physical water , and it was our understanding that
Eagle still doesn t have a water right.I know they
trying desperately, also, to do everything they possibly
can to get it, but they still don t have it.
Mr. Yorgason
Yes.
--
how do you know the City of Eagle does
not have a water right?
ve asked them for it and we haven
received it.We asked them clear back -- clear back in
May we were asking for it, even before then , and we were
told we d have it, we were told we d have it.May 24th
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Wilder, Idaho
193 YORGASON (X)
Capi tal Development83676
we were told we I d have it in two weeks, and then they
said, well , how about how July, how about August and we
said okay.
MR. SMITH:Madam Chairman, I'm going to
move to strike the answers as non-responsive, okay?
asking Mr. Yorgason specific questions and he is now
elaborating on the history of negotiations and so at this
time I want to do one thing.I want -- we have an
agreement before -- we have an agreement between Capital
Development and the City of Eagle.Mr. Yorgason has
offered testimony about that agreement.I would like to
move to strike his testimony that seeks to interpret the
agreement.The agreement has a consolidation clause in
it that says it basically concludes all -- it rolls all
prior discussions into the agreement and the agreement is
the agreement between the parties, and Mr. Yorgason ' s
supplemental testimony as well as some of the testimony
he provided today seeks to interpret that agreement
differently from what the agreement says, so I would like
to have -- like I said, I'm making a motion to strike his
testimony that seeks to interpret or add to that
agreement beyond the four corners of the document
itself.
COMMISSIONER SMITH:So Mr. Smi th , you
not seeking to strike his prefiled testimony which we
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Wilder, Idaho
194 YORGASON (X)
Capi tal Development83676
have already spread on the record; is that correct?
MR. SMITH:To the extent that prefiled
testimony is inconsistent with the agreement,
Madam Chairman , I am.
COMMISSIONER SMITH:But Mr. Smith, the
time to obj ect to any of the prefiled testimony was
before we put it on the record, so it I S already there and
it's part of the record and I guess since the
Commission s not going to interpret this contract, I
guess I think I'll just let it stand and just direct the
wi tness to please listen very carefully to the question
and just try to answer that question only.I think the
Commission has a clear sense of your level of
frustration, so just try to concentrate on Mr. Smith'
questions and provide just the answer to that question
only.
Okay.THE WITNESS:
There we go.Thank you veryMR. SMITH:
much.
If you d repeat theTHE WITNESS:
question, I'll try and be more direct and I apologize if
I got wound up.
That I s okay, Mr. YorgasonBY MR. SMITH:
I appreciate it.When you refer to United Water has a
line at the property, you re referring to the fact they
CSB REPORTING
Wilder, Idaho
195 YORGASON (X)
Capi tal Development83676
have a water line at your property; correct?
Yes.
Okay, did you inquire of United Water
about the specifics of the water rights that would be
used to serve your property?
I asked them about where the water was
coming from.I don t know if that answers your question.
m trying to be direct.I think that answers your
question directly.
No.
Oh.
I I m trying to distinguish between having a
pipeline there and the water right that would provide
water through that pipeline.Did you inquire of United
Water about the specific water right that would be used
to serve your property through that pipeline?
I didn t inquire.I was told by United
Water staff that it was coming from the Redwood well
and they told me how many gallons it was approved for and
how many they need and how it would be able serve our
Does that answer your question?property.
Uh-huh, and when did they tell you this?
It's been several months ago.I don
know the date.It was early in our discussion with
Uni ted Water.
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Wilder, Idaho
196 YORGASON (X)
Capi tal Development83676
Do you recall if it's before or after the
agreement that you reached with the City?
I believe it would have been probably
I don t think it's been that long ago.I meanafter.
it wasn t like a year ago, because we had the same
concern for them.We wanted to be sure that if Eagle
can I t provide water to our satisfaction, can United Water
provide it to our satisfaction, so we had that same kind
of a discussion.It wasn t technical in terms of permit
number , but we were told how many gallons, I remember
they talked about how many gallons, it would provide and
it was capable of
--
that it would be capable of
providing to our property.
Is it your testimony that your
dissatisfaction with the City is based on the preliminary
permi ts that are being considered by the department or,
excuse me, the permits that are being considered by the
Department of Water Resources, is that the basis for your
concern about the City?
No, sir.
Is it about the lease?
The basis for our concern is that weNo.
can receive water.It'I don t care where they get it.
not just because of the protestants or the lease,
al though , as has been discussed, we have concerns, but
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Wilder, Idaho
197 YORGASON (X)
Capi tal Development83676
it's just if we can get water.I mean, they can bring
water from some other location and pipe it over , which
was discussed, and that would be fine, that would be
great.We just want to get water.
So if the City can provide water , you
would be satisfied with that?
Yeah.ve always said that, yeah.
And you re aware that the City constructed
a main line up to the southern boundary of your property;
correct?
Through Legacy, that's my understanding,
yes.
So, in essence, the City has a main line
to your property and United Water has a main line , in
essence, to the border of your property; correct?
Yes, one has water in it and one doesn '
to my understanding.
Mr. Yorgason, I'm asking you about the
physical pipelines right now.
It's my understanding.Yes, I haven t --
the answer is yes.
Okay.You testified when we were talking
about the confidentiality agreement, you were talking
about the, I'll call it , concessions made by the City to
you, do you recall that?
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Wilder, Idaho
198 YORGASON (X)
Capi tal Development83676
Yes.
And you would agree that you got benefit
from those; correct?
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Wilder, Idaho
Yes.
MR. SMITH:I have no further questions.
COMMISSIONER SMITH:Do we have any
questions from the Commission?
COMMISSIONER REDFORD:No.
Thank you.
COMMISSIONER KJELLANDER:No.
BY MR. BURNS:
COMMISSIONER SMITH:Any redirect?
MR. BURNS:Just a couple of questions.
REDIRECT EXAMINATION
Mr. Yorgason, do you remember testifying
towards the beginning on cross-examination that you had
incurred horrendous delays in starting the construction
of your proj ect?
Yes.
What was the cause of those horrendous
It was primarily trying to figure out
get water to build a subdivision and
delays?
where we could
199 YORGASON (Di )
Capital Development83676
service a subdivision.
So does it relate around the very reason
that we re here today?
That is correct, yes.
Now , after careful consideration of the
si tuation, do you and Capital Development still want
Uni ted Water to provide water service to Lanewood
Estates?
We would like water.That I S all we want
is water and it appears to us that United Water is able
to provide it physically and so at this point in time we
would like United Water because it appears they are the
only one that can give it to us and that's our opinion.
MR. BURNS:I have no further questions.
Thank you.
COMMISSIONER SMITH:Thank you, and thank
you, Mr. Yorgason.
(The witness left the stand.
COMMISSIONER SMITH:Mr. Burns, do you
have other witnesses?
MR. BURNS:No, we have no more witnesses.
Thank you.
COMMISSIONER SMITH:Thank you.
Mr. Smith.
MR. SMITH:re going to call Vern
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Wilder , Idaho
200 YORGASON (Di )
Capi tal Development83676
Brewer.Wi th regard to the same issues that Mr. Burns
had, when we initially filed, we had affidavits --
COMMISSIONER SMITH:Right.
MR. SMITH:
--
and then we went back and
fixed our testimony to comply with Commission rules.
COMMISSIONER SMITH:Okay.
MR. SMITH:I want to make sure Mr. Brewer
is aware of both of those so that when we ask questions
about correcting testimony, he s aware of which ones
re dealing with.
COMMISSIONER SMITH:Do you want a few
minutes, then?
MR. SMITH:If I could.
COMMISSIONER SMITH:ll be off the
record for a few minutes.
(Pause in proceedings.
COMMISSIONER SMITH:ll go back on the
record.Mr. Smith.
MR. SMITH:Thank you.
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Wilder , Idaho
201 YORGASON (Di)
Capi tal Development83676
VERN BREWER
produced as a witness at the instance of the City of
Eagle, having been first duly sworn, was examined and
testified as follows:
BY MR.SMITH:
DIRECT EXAMINATION
Good afternoon, Mr. Brewer.
Good afternoon.
Mr. Brewer , what is your job?
m president of Holladay Engineering
Company and manager of parts of the company, a liaison to
CSB REPORTING
Wilder, Idaho
the City of Eagle representing the City engineer which is
the contract engineer for the City of Eagle.
And what exactly does the City engineer do
for the City of Eagle?
We do a number of things, including
infrastructure planning and development, plan review
flood plan analysis , a full gamut of civil engineering
functions that are required by the City.
And would that include the issues related
to provision of water services to customers wi thin the
Yes, it does.
Ci ty?
202 BREWER (Di)
Ci ty of Eagle83676
Did you file direct testimony before the
Commission on May 14th in this matter?
CSB REPORTING
Wilder, Idaho
Yes, I did.
Okay, and did you also file supplemental
direct testimony before the Commission on September
Yes, I have.
Have you reviewed that testimony prior to
I have.
Wi th regard to the May 14th direct
testimony, do you have any changes or additions to
Yes, I do.
Please explain that.
The May testimony envisioned a number of
development proj ects that were in the process of taking
place.Those development proj ects, including
construction of a water trunk line to the street abutting
Lanewood development, have been completed.A number of
the other proj ects, again , envisioned in that entire
response to No.5 have been completed and have been
tested and are basically usable at this time.
Mr. Brewer, let me direct your attention
to the direct testimony.It would have been in paragraph
17th?
today?
that?
203 BREWER (Di)
Ci ty of Eagle83676
5 of the testimony with regard to how does the City plan
to serve Lanewood.
Yes.Thank you, I should have gone into
that.At the time that the direct testimony was
submi tted, the City was in the process
--
we had
completed our application and our hearing before the
department, but we had not yet received any kind of an
order back from the department, so one of the key issues
that has occurred since that testimony is the City did on
July 18 receive a preliminary order granting the City
approval of its water rights, it's 8.9 cfs of water from
the department and thereby, it set into play the
responses to the various conditions in terms of that
order.The City has also proceeded with that order in
mind to do all the additional development and mitigation
plans that were anticipated by the order of July 18th.
Referring to that testimony, it was
talking about the pending applications for water
rights?
That's correct.
Has the City done other things with regard
to water rights to serve Lanewood?
Yes, it has.Because there was a gap of
time between the end of the hearing and the issuance of
the preliminary order, the City immediately began working
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Wilder , Idaho
204 BREWER ( Di )
Ci ty of Eagle83676
wi th the department on the ability to obtain water
from -- In that area through a lease program.This was
begun back in May or June.I don t know the exact date.
I remember several discussions.After we received the
preliminary order , we ve carried out or we completed
those applications for the lease and the lease for the
water was granted, I believe, on the
--
I think it was in
mid September, September 17th , I believe.
With regard to that lease, what water
right is being leased?
MR. MILLER:Madam Chairman , if I might,
wi th all due respect, the Commission established a date
for supplemental testimony; that is, a date to update the
previous testimony to bring us all up to date prior to or
just prior to the hearing.The City had the opportunity
to explain for the Commission everything that it wanted
to try and explain that's occurred since the previous
order, and I think it's improper now for the City to
ignore its supplemental testimony opportunity filing and
now in live testimony without any of the other parties
having an opportunity to know and understand what could
have been revealed in the supplemental testimony to do
this in live testimony.
There is a reason the Commission requires
prefiled testimony and that is so that by the time of the
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Wilder, Idaho
205 BREWER (Di)
City of Eagle83676
hearing the parties can know the other parties ' factual
positions, and it's a , I guess, disrespect to the
Commission s procedures to now attempt to do it in a way
that's unfair to the other parties.
COMMISSIONER SMITH:Mr. Smith.
MR. SMITH:Madam Chairman , as a general
response to things that show up at the last minute , I
somewhat sympathize with Mr. Miller because that was the
point of our motion to vacate and continue this morning
because we thought there were factual issues that we were
not aware of at the time of the hearing and some of the
things that were brought up this morning.What we re now
talking about is updating the testimony or changing the
testimony of the direct testimony, not the supplemental
testimony, to provide an up-to-date response to the
Commission , and what Mr. Brewer is testifying about
clarifies the information in the testimony about how the
Ci ty plans to -- the question was how does the City plan
to serve Lanewood and that's what Mr. Brewer is
explaining.
COMMISSIONER SMITH:And this was in his
testimony
MR. SMITH:His direct testimony,
correct.
COMMISSIONER SMITH:-- filed May 14th?
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206 BREWER (Di)
Ci ty of Eagle83676
MR. SMITH:Correct.
COMMISSIONER SMITH:But you didn I t see
the need to update that in your supplemental testimony
for things that have changed since May 24th?
MR. SMITH:What we provided in the
supplemental testimony were the options that the City had
available and so by the time we got around to looking
the options that the City has, which is what is put into
the supplemental testimony, the City still has all of
those options available.They have the pending permits.
They have the purchase of Eagle Water Corp. and they have
this lease arrangement and that was the information that
we provided in our supplemental testimony.
COMMISSIONER SMITH:Okay.All right; so
then I guess the question is if you adequately updated in
your supplemental, what's the purpose of the live direct
now?
To explain how we plan toMR. SMITH:
serve Lanewood.The question arose in our direct
testimony.
COMMISSIONER SMITH:And if your answer
had changed, you would have explained that in the
supplemental; right?
No, unless I misunderstoodMR. SMITH:
what you were asking for in supplemental testimony.
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207 BREWER (Di)
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thought the supplemental testimony was to add anything
else that we wanted to add.I didn t think it was
requiring us to provide specific information.
COMMISSIONER SMITH:I believe
MR. SMITH:Let me just address
Mr. Miller s point.There s no disrespect meant to the
Commission s proceedings.
COMMISSIONER SMITH:I understood that.
MR. SMITH:We were filing what we thought
we were supposed to file.
COMMISSIONER SMITH:Yes , I believe in our
Notice of Additional Scheduling and Second Notice of
Hearing, which was issued on August 30th, 2007 , we
provided for a September 17th, 2007 date for the
simultaneous prefile deadline of supplemental testimony;
i. e., changes that have occurred subsequent to May 24th,
2007, so I guess that's Mr. Miller s objection , that
somehow these are changes that should have been in your
supplemental testimony, but what I understood you to say
is your supplemental explains that all the options you
had previously still exist.
MR. SMITH:m sorry?
COMMISSIONER SMITH:All the options you
had previously to answer the question how does the City
plan to serve Lanewood still exist today, isn t that what
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208 BREWER (Di)
City of Eagle83676
you just said?
With certain limitations.MR. SMITH:For
instance, on the pending applications, I mean , we readily
acknowledge that we don t have an order from the
Department of Water Resources.
COMMISSIONER SMITH:Right.
MR. SMITH:So that is an option, but
depending upon when the development needs water,that may
or may not available us.
COMMISSIONER SMITH:That'not change
though, right, that's the same as it was in May?
THE WITNESS:No.
MR. SMITH:Well, except for the fact that
we now have a preliminary order that approved those water
rights or those applications, excuse me.
Right.COMMISSIONER SMITH:
I guess if the question is areMR. SMITH:
you asking did we not see a need to indicate the lease
arrangement to the Commission , we had an agreement with
Capital Development and we provided that information to
That goes to the very heart of our agreement withthem.
them about providing information with regard to water
rights.
All right, well , ICOMMISSIONER SMITH:
see I have taken us down into a morass that we probably
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209 BREWER (Di)
Ci ty of Eagle83676
don t need to go in, so I'm going to overrule your
obj ection, Mr. Miller.Mr. Smith, if you have changes or
clarifications that need to be made, then let's do those
now.
Okay.MR. SMITH:Can you read back the
last question I asked of the witness, please?
(The last question was read back by the
. Notary Public.
BY MR. SMITH:Mr. Brewer, do you know?
I do.The water right that is being
leased is the City s existing right 63-12448.
Okay.
That right was granted to the City many
years ago and unlike other leased rights that were
previously referred to is not a right from some third
party or dependent upon a third party.Basically the
Ci ty is leasing its own water right from itself to meet
this requirement and therefore, the lease portion of this
is entirely wi thin the control of the City to
perpetuate.
And that leased water right is available
to be diverted from the same location , the same well, as
the pending applications?
That's correct, it is.
Mr. Brewer, would you look at your
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testimony, supplemental testimony, of September 17th
your supplemental direct?
Yes, I have that.
Are there any changes or additions to that
testimony?
Yes, there are.In that testimony on page
2 and going into page 3, lines 23 on page 2 and line 5 on
page 3, we had stated that as of 9: 30 that morning we had
not received plans or inquiries or information from
Capi tal Development on their water system.That
supplemental direct was filed on September 17.
Subsequent to that, we have on September
--
later that
day on September 17th , we received, the City received, an
application for annexation, and on September 18th , the
Ci ty received the plans for the water system for us to
review.Said review has now been drafted, but all of
those items have changed since that supplemental was
submitted to the Commission.
MR. SMITH:Madam Chairman , we would ask
to spread Mr. Brewer s testimony across the record and
tender him for cross-examination.
COMMISSIONER SMITH:If there is no
obj ection, we will spread the prefiled testimony of
Mr. Brewer across the record as if read and identify
Exhibits 203, 204, 207 and 208.
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211 BREWER (Di)
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(The following prefiled direct and
supplemental testimony of Mr. Vern Brewer is spread upon
the record.
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212 BREWER (Di)
City of Eagle83676
Please state your name and identify your
relationship to the City of Eagle.
My name is Vern Brewer. I am the President
Holladay Engineering and proj ect Manager/Liaison
between the City and our team of Professional Engineers
and Geologist responsible for the water system design and
construction.Holladay Engineering Company was appointed
City Engineer in 1997 and currently serves in that
capacity.Holladay Engineering is responsible for plan
review , water system and well design, system modeling,
infrastructure planning, and financial planning for the
Professionals assigned to these taskswater system.
include:Ken Rice, P. E., Senior Design Engineer; Chris
Duncan, P.G., Geologist; Andy Gehrke, P.E., Engineer; and
John Blom, P. E., Engineer.As proj ect manager I have
been responsible for proj ect planning and management,
cost analysis and the interface between the engineering
team, the council , and the land use professionals
employed by the City.
What is the City s Water Master Plan?
The City of Eagle, through a 4-year land
use and infrastructure planning process, adopted a City
Water Master Plan that includes, in part, that area
between Linder Road and Highway 16, from the Boise River
to Homer Road on the North.A portion of this area
213 VERN BREWER , Di
Ci ty of Eagle
now being proposed for Lanewood Estates.In accordance
wi th the Plan , the City has designed a series of trunk
lines and laterals, two one-and-half-million gallon
water storage tanks, and five wells in order to serve the
entire area.The water trunk line and well system is
capable of supplying the
214 VERN BREWER, Di
Ci ty of Eagle
entire area based on the pressure and flow requirements
in accordance with the City s Comprehensive Plan.
Wi th regard to the Lanewood development,
are you familiar with its location?
Yes, it is immediately adj acent to the
City limits and within the City s area of impact.
Has the City planned to provide water
service to Lanewood?
This is consistent with the City 'Yes.
Comprehensive Plan and Ada County.
How does the City plan to serve Lanewood?
The City has been working with some large
developments near Lanewood to complete the first phase of
the City s western area municipal system.Construction
should be completed by July, 2007.Two wells capable of
pumping about 4,000 gallons per minute have been
constructed.Both wells were constructed according to
the IDEQ' s standards for municipal wells.A third well
wi th 1,500 gallons per minute capacity is scheduled for
2008, bringing capacity to 5,000 gallons per minute.The
Ci ty has pending applications for water rights for these
wells.Because the water right applications were
protested, the City had to go through a lengthy hearing
process which has now been completed.The City received
a favorable staff recommendation and expects the
215 VERN BREWER, Di
Ci ty of Eagle
applications to be approved in the June-July period.
Interestingly, part of the delay in getting the
applications approved was caused by United Water
protesting the applications.
216 VERN BREWER, Di
Ci ty of Eagle
In addition to the wells, a 16" main line is currently
under construction from one well to the southern boundary
of the Lanewood property.This line should be completed
in July.If Lanewood completes its county approval
process and wants to begin construction of its
distribution system , it can do so.See Eagle Exhibit
203.
The 16" main is an important component of the
Ci ty ' s system because it will run through the Lanewood
development and connect to other portions of a loop
system designed to bring water to many properties in the
Ci ty I S western expansion area.It will connect to future
storage reservoirs.
The western expansion area is shown on Eagle
Exhibit 204.This is the area where the City has been
and is planning to provide water service.Under the
present configuration and capacity of the existing wells,
all IDEQ requirements for the public water system can
met now and in the future.All of the existing
infrastructure under construction and being planned
conform with the City s approved Water Master Plan for
the area.
What is the City s cost of service?
The City s annual cost of water service is
$344.76.I checked United Water s websi te and they
217 VERN BREWER, Di
City of Eagle
charge $398.43.Ci ty of Eagle customers pay less based
Does the City encourage conservation of
on comparable use.
water?
218 VERN BREWER, Di
Ci ty of Eagle
Yes, the City encourages all citizens to
conserve their use of water.For instance, the City
requires use of surface water for irrigation.
In Scott Rhead' s testimony, he indicated
that the two existing City wells are not constructed to
municipal standards and that construction of a mainline
to Lanewood has not begun.Is this correct?
No.Both City wells are brand new and are
constructed to IDEQ standards.The mainline is under
construction and will be built to the Lanewood boundary.
The developer has suggested that he
intends to begin construction of his water distribution
system in July, 2007.Will this schedule of development
be impeded by the construction of the City s mainline or
IDEQ approval of the distribution system?
No.Lanewood can begin construction of
the distribution system as soon as IDEQ regulations
IDEQ has granted the City Engineer the ability toallow.
review and approve plans for the distribution system in
accordance with the approved Master Plan in the same
manner that United Water is capable of approving plans to
their system.The timeframe and process for review and
approval of plans is the same through the City as it
through United Water.Most recently the plans for the
Legacy development were approved in about a three-week
219 VERN BREWER, Di
Ci ty of Eagle
turn around through the City.In the event that Capital
Development were to submit complete plans for the
Lanewood development to the City, the City Engineer would
begin the plan review.The plans could be reviewed and
approved wi thin about thirty (30)
220 VERN BREWER, Di
Ci ty of Eagle
days and the developer could begin construction on July
wi thout any delay to their construction schedule.IDEQ
does not need to independently review and approve the
City of Eagle water delivery system in the western
expansion area.
Would allowing United Water to serve the
Lanewood development interfere with the completion of the
Ci ty ' s water system and associated services?
Yes.The City s planned trunk line loop,
which includes a 16-inch water main coupled with 12-inch
and 8-inch laterals to serve the area within the western
expansion designated boundary, is a fully integrated
system developed by modeling flows and pressures for the
entire western area.The 16- inch main runs through the
Lanewood development.The insertion of United Water into
this system will disrupt a four or five-year planning
process engaged in by the City, and it would certainly
impair the ability for the City to close its loop to
ensure that the residents north , south, and west of
Lanewood could participate in a fully integrated and
designed water system.
A second component of the integrated water
system for the western area is the development of a
financial model for residents of that planning area to
contribute to a storage and trunk-line network fund to
221 VERN BREWER , Di
Ci ty of Eagle
provide for the eventual construction of two
one-and-half-million gallon storage reservoirs that
would provide emergency and fire flows at build-out.
Excluding Lanewood from the system will have the effect
of raising the cost of storage to the remaining residents
participating in the construction and would interfere
wi th the obj ecti ve of
222 VERN BREWER , Di
Ci ty of Eagle
spreading costs equitably among the users of the system.
Eliminating Lanewood participation would cause an
immediate 4.5% increase to all other planned residents
for those storage and trunk line fees.Based on these
factors, I believe it is in the public interest to allow
the City to serve this area.
223 VERN BREWER, Di
City of Eagle
Wha t is your name?
Response: Vern Brewer.
Who do you work for?
Response:Holladay Engineering.
What is Holladay Engineering s relationship
wi th the City of Eagle?
We are the appointed City Engineer.Response:I am
the proj ect Manager for Holladay Engineering assigned to
the City of Eagle.
Are you the same Vern Brewer who has previously
provided testimony in this matter?
Response:Yes.
Do you have any supplemental testimony to add
to the testimony previously provided?
Yes.At the last hearing in this matterResponse:
which occurred on May 24 , 2007, I am aware the City of
Eagle and Capital Development reached a settlement
agreement which is attached as Exhibit 207 to my
testimony.That agreement called for the City to
withdraw its objections to the applications filed by
Capi tal Development with Ada County, to apply for
annexation with the City of Eagle, and to provide
development improvement plans, and specifically water
improvement plans to the City for review.
As City Engineer , Holladay Engineering would
224 BREWER , Di-Supp
Ci ty of Eagle
normally be aware of the annexation application and would
be the reviewer for the plans that were to be submitted.
I have checked with City Staff and Holladay Engineering
225 BREWER, Di-Supp
City of Eagle
Staff and I have information that Capital Development has
submitted an annexation application at 9:30 a.m. this
morning.Holladay Engineering has received no
information or communication from Capital Development
about its water improvement plans, or requirements for
connection to the City s water system.The City has only
had written or oral inquiries from Capital Development
regarding water rights and well construction
schedules which have been provided in the City s status
reports sent to Capital Development through their
attorney, Bob Burns.
As part of its work with the City, Holladay has
inspected the area where the development is to take
place.As of last week, there is no construction work
ongoing.In fact, the site is a cornfield, as shown on
the photos as Exhibit 208.It will be quite some time
before there will be a need for water service.The City
has provided written status reports approximately every
two weeks as agreed.The City of Eagle is prepared to
provide water service to this development as set forth
the Agreement.
The well that will provide water is in the
final stage of completion.A pipeline from that well has
been constructed to the boundary of the Lanewood
As for water rights to be used for service,property.
226 BREWER , Di-Supp
Ci ty of Eagle
the City has a number of resources.The City has
existing water rights that can be used if necessary.
Since the previous hearing in May, the City has
contracted to purchase Eagle Water Corporation and that
process is
227 BREWER , Di -Supp
Ci ty of Eagle
underway.Eagle Water Company has a number of water
rights that could be potentially be used.The City also
has applications for almost nine (9) cfs of water that
received preliminary approval from the Idaho Department
of Water Resources.The order approving the applications
is being reconsidered but, based on the requests for
reconsideration, the City anticipates the applications
will be approved in the imminent future.The City had
anticipated that the final order would be issued by now
but, for unknown reasons, it has not.Al though I cannot
be sure, based on discussions with other Holladay
Engineering Staff , it could be associated with workload
requirements at the IDWR.However , even if the order
requires mitigation of any type, the City has already
arranged for payment and implementation of any required
mi tigation.
Regardless of which of the above described
options is finally used, the City can and will provide
water service to the development as reflected in the
Agreement.
Does this conclude your supplemental testimony?
Response:Yes.
228 BREWER , Di -Supp
Ci ty of Eagle
open hear ing .
(The following proceedings were had in
COMMISSIONER SMITH:Is Mr. Burns going
first?
Mr. Woodbury, do you have questions?
MR. WOODBURY:Thank you.I do, thanks.
BY MR. WOODBURY:
CROS S - EXAMINA T ION
Mr. Brewer , if I could direct your
attention to your Exhibit 203.That's a map of the City
of Eagle water system.
That exhibit, for clarification, that
exhibi t was part of the May testimony; is that correct?
CSB REPORTING
Wilder, Idaho
Yes.
Okay, I recall that.
Do you have it in front of you?
I do not.
(Mr. Smith approached the witness.
BY MR. WOODBURY:Mr. Brewer , as I look at
this, it purports to be the City s water system west of
North Linder and south of West Floating Feather Road; is
That is correct.
that correct?
229 BREWER (X)
City of Eagle83676
And it does depict a subdivision
apparently platted subdivision , that's south of West
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Wilder, Idaho
Floating Feather Road and adj acent , immediately south of
the Lanewood subdivision.What is the name of that
There are actually two subdivisions
One is the subdivision known as Eaglefield.
The other one is generally the area known as Legacy,
al though the subdivision that is actually submitted has
been renamed to Mosca Seca or something like that.
And is the City providing actual water
service to any of that area?
The City is providing water service to all
You are presently providing and serving
customers in that area?
There are no customers as of this date in
And this particular exhibit identifies two
there, the Legacy well and the Eaglefield
That is correct.
Are either of those wells the water rights
that the company is trying to secure for Lanewood?
COMMISSIONER SMITH:Do you mean the City,
subdivision?
depicted.
of that area.
that area.
wells located
well.
230 BREWER (X)
Ci ty of Eagle83676
Mr. Woodbury?
MR. WOODBURY:Pardon?
COMMISSIONER SMITH:You said " company, "
did you mean the City?
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Wilder, Idaho
MR. WOODBURY:The City, excuse me , thank
you.
THE WITNESS:Each of those wells commonly
known as Eaglefield and Legacy wells each make up a point
of diversion of the overall water right that the City has
applied for and has preliminary approval from the
department.
BY MR. WOODBURY:Okay; so these are the
same wells?
That's correct.
And do I understand that the City I S main
line that you would seek to serve Lanewood is along West
Floating Feather Road
No.
--
the southern portion?
That is not entirely accurate.The line
on Exhibit 203 that is marked 16 inch trunk line runs
generally parallel with Linder Road west of Linder , but
it's not on Linder Road itself.It will wind its way up
through the subdivisions based upon as they come in.
All right, and do I understand that wi thin
231 BREWER (X)
Ci ty of Eagle83676
this Eaglefield and Legacy area and the two wells that
are depicted in there, although you might have pipe in
the ground, there is no water in the pipe?
At this time there is not.The lines are
in the ground, tested and ready to receive water.
Thank you.As part of your oral amended
testimony with respect to Lanewood' s submission of plans
following its annexation request, I refer you back to
your direct testimony and you stated that if Capital were
to submit complete plans for Lanewood to the City, plans
could be reviewed and approved within 30 days.Ha ve you
reviewed the submittal by Lanewood?
We have.We received those plans on the
18th and our review, our draft review, is being
circulated internally right now.It will be ready for
release tomorrow.
And do you believe that what was submitted
are the complete plans that you would be looking for?
I don t have that review available to me
right now.I don t know if there was something lacking.
I just don t have that in front of me at the present
time.
COMMISSIONER SMITH:Mr. Woodbury, I
apologize for interrupting, but the Commission needs
about a five-minute break.
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232 BREWER (X)
City of Eagle83676
(Recess. )
COMMISSIONER SMITH:All right, I think
re ready to go back on the record.Mr. Woodbury, I
apologi ze for the interruption.Please proceed.
MR. WOODBURY:Thank you, Madam Chairman.
BY MR. WOODBURY:Mr. Brewer, my question
was with respect to your initial testimony filed in this
case and you stated that if Capital were to submit the
complete plans for Lanewood to the City, the plans could
be reviewed and approved within 30 days.Do you think
that is still a reasonable time line?
Mr. Woodbury, let me clarify my statement
just as we ended testimony for the break.As I stated,
we have received plans from Capital Development.I spoke
wi th the reviewing engineer during the break and those
plans are complete and are in substantial compliance with
the City requirements, so in response to the 30 days, it
would appear to me that we ve reviewed those plans and
are able to get a response back to Capital Development
tomorrow, which is about a week's turnaround time on
those plans.
Okay, and that review and approval process
is separate from the annexation request?
Yes, those are two distinct, separate
actions by the City.
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233 BREWER (X)
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And to your knowledge, has the City ever
extended water while an annexation request is pending?
The City of Eagle has never been as ked to
do that.
With respect to Legacy and Eaglefield,
what kind of a time line are you on to provide water to
them?
The Eaglefield well was initially
scheduled to be completed by October 3rd and now appears
it will be October 17th.We just received an updated
schedule from the contractor.The Legacy well, it was
testified to in our public meeting last week that they
would be complete by October 15th.
And are those areas, the Legacy
Subdi vision and the Eaglefield Subdivision, have those
been annexed by the City?
Yes, both of those areas have been
annexed.
And you indicated in your original
testimony that in addition to these two wells , Legacy and
Eaglefield, that there was a third well that was
scheduled of 1,500 gallons per minute scheduled for
2008?
That is correct.
Is that a presently pending application?
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Ci ty of Eagle83676
That application has been reviewed and
approved by the City.There is a development agreement
approving that additional well or an MOU, excuse me, on
that additional well and to my knowledge, the plans are
proceeding on schedule to have that in by 2008.
And where is that in relation to the
Legacy and Eaglefield wells?
That well would be just south of State
Highway 44 south of Eaglefield.
And do I understand, also, just in
referring back for purposes of clarification to this
Exhibit 203 that the Lanewood Estates Subdivision is
immediately north of the area depicted as your water
system?
That's correct.
MR. WOODBURY:Madam Chairman, Staff has
no further questions.Thank you.
COMMISSIONER SMITH:Thank you.
Mr. Burns.
MR. BURNS:Thank you.
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Ci ty of Eagle83676
CROSS-EXAMINATION
BY MR. BURNS:
Mr. Brewer , you testified on page 3 of
your supplemental direct testimony starting at line
through line 21, "The well that will provide water is in
the final stage of completion.A pipeline from that well
has been constructed to the boundary of the Lanewood
property. "Now , that portion of your testimony deals
wi th the physical construction of the infrastructure to
allow service of water to the Lanewood Estates;
correct?
That is correct.
Now , the next line starting on line 20
through 21 says, "As for water rights to be used for
service, the City has a number of resources.That was
your testimony; right?
That's correct.
Okay.Now, I want to focus just on the
water rights, the water that goes into those physical
improvements that are being constructed and it has to get
from those physical improvements to Lanewood Estates.
Now , can you describe each and every water right that
Eagle currently has that it can use at the present time
to provide water from the well referenced in your
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236 BREWER (X)
Ci ty of Eagle83676
testimony?
The water right that would currently apply
is the one I cited earlier, 63-12448.
And that's the only water right, then
that the City of Eagle currently has that can be utilized
to provide water to Lanewood Estates; correct?
That's correct.
Okay.
MR. BURNS:Now, I earlier submitted
copies of Exhibit 311 to each of the Commissioners and
would like to hand one to this particular witness because
this particular document is not part of the record and
has not been previously supplied if that would be okay.
COMMISSIONER SMITH:That would be fine.
(Mr. Burns approached the witness.
BY MR. BURNS:Now, Mr. Brewer, is this
the water right that you are relying on, then , for your
testimony that Eagle has water rights to provide water
service to Lanewood Estates?
Yes, this is permit 12448, a lease
agreement dealing with that water right.
Okay, can you tell me what the date of
this lease was or is?
The stamp date on this is September 12th,
2007.
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Ci ty of Eagle83676
Now , this lease wasn t in existence back
on August 24th, was it?
No.
Okay, and can you tell me what the volume
of water that this lease is for?
This annual rented volume is 130 acre
feet.
And what is the cfs?
8 cfs.
Okay.Now , have you reviewed the
preliminary report that was issued with respect to the
water rights that the City anticipated it would obtain
and anticipated using for serving Lanewood Estates as
well as the Legacy proj ect?
m not sure.Could you name the report
please?
It's attached as Exhibit 105 orSure.
excuse me, Exhibit 5 now in these proceedings.It's a
preliminary report.It's in the matter of applications
to appropriate water numbers 63-32089 and 63-32090 in the
name of the City of Eagle.
Pardon, could we clarify whichMR. SMITH:
exhibi t?
This is Exhibit 5 and this wasMR. BURNS:
an attachment to the supplemental testimony of Scott
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238 BREWER (X)
Ci ty of Eagle83676
Rhead.
COMMISSIONER SMITH:So this is the
preliminary order of the Department of Water Resources?
MR. BURNS:Yes, ma ' am.
THE WITNESS:I have that before me now.
Wha t was your question again?
BY MR. BURNS:You have that in front of
you?
Yes.
Okay, and have you reviewed this document
Yes, I have.
Okay, could you turn to page 7 of that
document, preliminary order page 7 , down at the bottom
CSB REPORTING
Wilder, Idaho
left-hand portion, and tell me what the finding of the
hearing officer was with respect to the amount of the
water that was necessary to service the area?
If you may be referring to item 10
Item 10.
--
on page 7?
I am.
It says, "The applications propose
delivery of water primarily for in-house use in the 2,000
homes proj ected for construction.The peak one-hour
demand for in-house use in 2,000 residential units is
before?
239 BREWER (X)
Ci ty of Eagle83676
23 cfs.
Okay, keep going.
In addition, Eagle is required to supply
the development with 6.68 cfs for fire protection.The
total proj ected instantaneous demand is 8.9 cfs, the
combined flow rate sought by the two applications.
Now, that's about 11 times more than the
cfs that is granted under this water lease, isn t it?
That's correct.
Okay, and this reference to the fire
protection volumes that are needed of 6.68 cfs for fire
protection , that's about eight times more than the water
that's covered by this lease which is Exhibit 311;
right?
That's correct.
Okay.Now , the City of Eagle hasn
challenged the findings of the hearing officer in this
Exhibi t 105 with respect to the quantity of water that'
necessary to provide water service and to provide fire
protection, have they?
No, we have not.
Now, looking at Exhibit 311 , can you tell
me what the term of the lease is?
The term of the lease is September the
11th to December 31st or the date of final resolution of
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Wilder , Idaho
240 BREWER (X)
City of Eagle83676
contested matters associated with water permits 63-32089
and 63-32090, whichever occurs first.
So what's the longest period of time this
It might run for five years.
Does it say anything about running five
years on this lease?
CSB REPORTING
Wilder, Idaho
The application stated five years.It was
lease might run?
anticipated by the department that the issue on the
preliminary order would be resolved before that time, so
we have communicated with the department and they
willing to grant this on a year-by-year extension.They
anticipate the preliminary order would be completed in
this period that's cited here on the lease.
So you applied for a five-year lease term
Correct.
And you didn t get a five-year lease term,
No, we did not.
Okay, and according to the express terms
of this lease, it expires at the outside date of December
31st of next year; correct?
That's correct.
Okay, and it also says that if there is a
originally?
did you?
241 BREWER (X)
City of Eagle83676
final ruling on those two water permits that you are
relying on to provide water to the proj ect, Lanewood
Estates, that if there s a final ruling on that, this
lease expires at that time; right?
That's correct.
And the final ruling could be adverse to
the City of Eagle, couldn t it?
Obj ection.MR. SMITH:It calls for
speculation.
COMMISSIONER SMITH:Mr. Burns, do you
want to respond to the obj ection or are you just
remodeling your question?
MR. BURNS:No, I'm asking this witness
who is an expert or who has provided testimony on behalf
of the City with respect to the terms of the lease and
how the City is going to be able to provide water to
Lanewood Estates with respect to exactly what kind of
character of water rights the City is looking to and has
in order to provide those water rights and that's what
all these questions go to.
COMMISSIONER SMITH:Right, but that
specific question seemed a little speculative.
MR. BURNS:Well , let me ask a different
question, then.
BY MR. BURNS:You re aware , are you not
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Wilder , Idaho
242 BREWER (X)
Ci ty of Eagle83676
Mr. Brewer, that there are a number of protestants who
are challenging the preliminary order that was granted by
the hearing officer with respect to the preliminary order
to the City of Eagle; right?
Yes.
Do protestants ever prevail in your
experience in challenges to water rights?
They can.
And in fact the City itself has protested
the preliminary order and some of the conditions in
there, hasn t it?
The City has sought clarification.
And it's asked for
--
it I s filed a motion
for reconsideration; correct?
Correct.
Just as the so-called protestants have
asked for reconsideration by the hearing officer;
right?
That's correct.
And the hearing officer, to your
knowledge, has the power to clarify or reconsider the
order and issue a ruling more favorable to the City or
less favorable to the City; right?
Yes, the hearing officer has that
authori ty.
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Wilder, Idaho
243 BREWER (X)
City of Eagle83676
Now, this lease, to your knowledge , it'
subj ect to both administrative and judicial challenge,
isn t it?
That's really not my area of expertise.
don t know.
So you don t know one way or the other
whether or not this lease can now be challenged by any of
these so-called protestants who have expressed opposition
to the water rights with respect to the Legacy well?
My very limited understanding is we I re
leasing our own water and it is not subj ect to a
challenge.
MR. BURNS:I have some excerpts of Idaho
statutes dealing with leased water and the appeal of
leased water and I'd ask to circulate them to all parties
and also have the Court take official notice of them
pursuant to your Rule No.2 63.
COMMISSIONER SMITH:Mr. Smith.
MR. SMITH:In order to speed things up,
m going to go ahead and interj ect my obj ection now if
s getting ready to ask the witness about interpreting
statutes.
I think what he askedCOMMISSIONER SMITH:
is that the Commission just take official notice of it.
That is correct.MR. BURNS:
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Wilder, Idaho
244 BREWER (X)
Ci ty of Eagle83676
COMMISSIONER SMITH:Which is something
re allowed to do under our rules.
MR. SMITH:Tha t 's true.
(Mr. Burns distributing documents.
BY MR. BURNS:So Mr. Brewer, you don
have any testimony one way or the other with respect to
whether people who are -- who have contested the grant of
the water rights that Eagle is obtaining whether or not
those people can challenge the lease?
I do not.
Did you check with Central District Health
Department to find out whether or not it would sign a
final plat for the proj ect based on leased water?
No, I did not.I checked with DEQ which
is referenced in a previously cited document and DEQ
indicated that they had no problem using leased water for
this application.
And who did you talk to DEQ?
Tiffany Floyd.
m sorry?
Tiffany Floyd.
And when did you talk to her?
don have the record with me but
was about three months ago when we first began
investigating the use of potential for a lease for this
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Wilder, Idaho
245 BREWER (X)
Ci ty of Eagle83676
application or for this particular issue before us.
And what is Tiffany Floyd's position with
DEQ?
I believe
--
I don t know for sure.
There s been a lot of maneuvering and changes in there.
At one time she was the
--
all I can say is she s over
the regional water for the district at DEQ and I really
don t know her official title today.
But you didn t check with anybody at
Central District Health Department?
No, DEQ has basically the authority over
the health district in that matter , so I went directly to
DEQ.
Central District Health Department is the
entity that signs the plat for recording, though;
correct?
Not necessarily in a city.I know they
may, but I truly can t tell you that.
So you don t know.Now , if the Central
District Health Department did refuse to sign the plat,
the Lanewood Estates proj ect would be stopped dead in its
tracks, wouldn t it?
I don t know the answer to that.
Do you have any reason to believe that the
proj ect could be built out if it didn t have a recorded,
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Wilder, Idaho
246 BREWER (X)
Ci ty of Eagle83676
signed recorded, plat?
Not if they re required to sign and it
wasn t signed, then they could not proceed.
CSB REPORTING
Wilder , Idaho
MR. BURNS:I have no further questions.
BY MR. MILLER:
COMMISSIONER SMITH:Thank you.
Mr. Miller, do you have any questions?
MR. MILLER:Just a couple, if I could.
CROSS- EXAMINATION
Mr. Brewer, I'm looking at your direct
supplemental testimony on page 3, line 2, 1 and 2, which
indicates that on the morning of September 17th , the date
that you filed that testimony, you received an
application from the City at 9: 30 that morning.
m looking at that testimony and what was
m just at this point directing your
attention to that.
Okay.
So I take it this testimony was prepared
some time later in the day on the 17th?
The testimony was actually prepared prlor
to then and I made those changes after doing a last
the question?
247 BREWER (X)
City of Eagle83676
minute check prior to filing.
So you were able to include in the
testimony information that came to your attention on the
CSB REPORTING
Wilder , Idaho
morning of the 17th?
That's correct.
When did you become aware of this lease
between the City and itself?
I became aware of the existence of the
lease on September 12th , but it had still not
--
there
was still no official ratification by the City, so it was
not technically of record and I could not at that point
attest to it in my testimony.
Tell me why it is you didn t include
of the existence of the lease on September
At that time I treated it as a lease
The copy I'm looking at indicates that
was signed by counsel for the City agreeing to the
conditions on September 12th.
The Council meeting that was on the agenda
to ratify that lease I don t believe was until the 17th
or 18th and that action, to my knowledge, had not
occurred when the information was filed.
You could have informed the Commission of
we 11,you knew
12th;right?
offer,yes.
248 BREWER (X)
City of Eagle83676
the existence of the lease and its status in your
supplemental testimony, could you have not?
I could have informed them of a draft.
mean, at that point that I s aIl it was until it's ratified
by the Council in my way I treat it.
Even though it's signed by counsel for the
Ci ty and appears to be fully executed by the
department?
It still had not been ratified by the City
Council which resolution was either the 17th or the 18th
and I'm not sure.
Is there anything that made this
confidential before it was ratified?
Not to my knowledge.
I guess a secret that everybody knows is
that in the preparation of written prefiled testimony,
it I s often a cooperative effort between the witness and
the attorney for the party.Did Mr. Smith or Ms. Buxton
cooperate with you or review your written prefiled
testimony?
My prefiled testimony was reviewed by
them.
MR. MILLER:That's all I have.
COMMISSIONER SMITH:Thank you,
Mr. Miller.
CSB REPORTING
Wilder , Idaho
249 BREWER (X)
Ci ty of Eagle83676
Do we have questions from the Commission?
COMMISSIONER REDFORD:I have one
question.
COMMISSIONER SMITH:Commissioner Redford.
EXAMINATION
BY COMMISSIONER REDFORD:
you have any reason to believe that
Lanewood Estates cannot be reasonably and adequately
provided service by Uni ted Water?
No, I have no reason to believe that.
Do you believe that they can provide
reasonable and adequate services to Lanewood Estates?
They could.It certainly would fly in the
face of everything the City has been working for for five
years, but they could.
So you have -- other than the City
desire to provide that service, you have no complaint
about the services that are going to be provided by
Uni ted Water in the event that they receive the
certificate?
I absolutely have reservation for United
Water providing that.Keep in mind we ve completed
m sorry, before you answer that
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Wilder, Idaho
250 BREWER (Com)
Ci ty of Eagle83676
Yes.
--
I just want to make sure that your
answer doesn t have anything to do with the City s desire
CSB REPORTING
Wilder , Idaho
to serve that property.
I think more importantly desire is the
plan since our trunk line that is part of our master plan
that forms part of our capital improvement plan goes
right alongside and adjacent to this subdivision, that
not completing that plan as we have worked a long time to
do would absolutely inj ure the City in getting its master
But as to those residents in Lanewood,
does United Water have adequate water to provide
Yes, they do.
Do they have adequate ability to provide
maintenance on that service?
Yes.
So notwithstanding your desire to have the
water provided by the City of Eagle, you have no reason
to believe that United Water can t adequately provide
No, I do not.
COMMISSIONER REDFORD:Thank you.
plan carried out.
services?
COMMISSIONER SMITH:Mr. Smith , do you
that service?
251 BREWER (Com)
Ci ty of Eagle83676
have any redirect?
BY MR. SMITH:
MR. SMITH:Yes, just briefly.
REDIRECT EXAMINATION
Mr. Brewer, Mr. Burns asked you about the
Central District Health Department signing off on
CSB REPORTING
Wilder, Idaho
developments on the plat?
Yes.
Are you aware of Central District Health
plats before the water line construction is
No, I'm not aware of that.
Are you familiar with the Mosca Seca
Yes.
Has Central District Health signed off on
Yes, they have.
And no construction has taken place on
Yes, all the water lines are in.
Oh, they are?
Yes.
signlng final
taking place?
development?
that?
that, has it?
252 BREWER (Di)
City of Eagle83676
Okay, and that Mosca Seca is part of the
Legacy development; is that correct?
CSB REPORTING
Wilder , Idaho
Yes.
And that is the same situation with regard
to the water rights that are pending at the Department of
Water Resources, is it not?
That's correct.
So those water rights haven t yet been
finalized, but Central District Health has signed off on
That's correct.
MR. SMITH:No further questions.Thank
COMMISSIONER SMITH:Thank you , Mr. Smith,
and thank you, Mr. Brewer.
(The witness left the stand.
MS. BUXTON:Madam Chairman , Members of
the Commission, Eagle City would next call Nancy Merrill
that?
you.
to the stand.
253 BREWER (Di)
City of Eagle83676
MAYOR NANCY MERRILL
produced as a witness at the instance of the City of
Eagle, having been first duly sworn , was examined and
testified as follows:
DIRECT EXAMINATION
BY MS. BUXTON:
Mayor Merrill, have you had an opportunity
to review your direct testimony filed on May 14 , 2007 in
this matter?
I have.
In regard to your direct testimony, did
you also have an opportunity to review the supplemental
testimony filed on September 17th , 2007 by Vern Brewer
and the exhibits thereof?
Of Vern?
Yes.
Yes.
Mayor Merrill, I would direct you to your
direct testimony of May 14th, 2007 , page 4, lines 15
through 17.Is it your understanding that you would
strike that sentence to be accurate for the record?
Yes, I would.After a very long Council
meeting and a very long next day, we did reach an
CSB REPORTING
Wilder, Idaho
254 MERRILL (Di)
Ci ty of Eagle83676
agreement with CDI that would allow them to go forward
wi th their application to the county, so we did not
recommend that the county disallow their application at
that time.
Mayor Merrill , with regard to page 5, line
, is it accurate in your understanding that the main
line that was discussed on that line has been
constructed?
Yes.
wi th those amendments, are there any other
changes to your direct testimony?
Not at this time.
MS. BUXTON:Madam Chairman, I would also
like to go through her rebuttal testimony, too, before
cross-examination.
COMMISSIONER SMITH:Okay.
BY MS. BUXTON:Mayor Merrill, I direct
you to your rebuttal testimony filed in this matter on
May 18th , 2007, and I direct you to page 2, lines 13
through 17.Specifically, lines 13 through 14, the
sentence
--
the recommendation is for denial of the
requested application.Based on your prior testimony
here, would you amend that sentence to say that the
recommendation is for approval of the requested
application?
CSB REPORTING
Wilder , Idaho
255 MERRILL (Di )
Ci ty of Eagle83676
Yes.
And Madam Mayor , that you would also
strike the next sentence starting with " I believe " and
ending with "City s area of impact"
Yes.
And then would the rest of your rebuttal
testimony remain the same?
It would.
MS. BUXTON:Madam Chairman and Members of
the Commission , we move to spread Mayor Merrill'
testimony across the record and tender her for
cross-examination.
COMMISSIONER SMITH:If there is no
obj ection, we will spread the prefiled direct and
rebuttal testimony of Mayor Merrill across the record as
if read and identify Exhibits 201 , 202, 205 and 206.
(The following prefiled direct and
rebuttal testimony of Mayor Nancy Merrill is spread upon
the record.
CSB REPORTINGWilder, Idaho 83676
256 MERRILL (Di)
City of Eagle
Please state your name and identify your
posi tion with the City of Eagle.
My name is Nancy Merrill, and I am the
Mayor of the City of Eagle.
Are you familiar with the location of the
proposed Lanewood development?
Lanewood is immediately westYes, I am.
of Linder Road and is adj acent to the Eagle City limits
and wi thin the City s Area of Impact as approved by Ada
County.
Is it the City of Eagle s intent and
desire to provide municipal water service to the Lanewood
development?
Yes, the City for some time has been aware
of the pending development of this property.Because of
its proximity to the City, its location within the City
impact area, its inclusion in the City s Comprehensive
Plan , and its inclusion in the City s Master Water Plan
the City has been preparing to serve this area and
include it within the City.
In addition to providing water to
Lanewood, are there other issues and planning efforts
that involve the Lanewood development and the City?
Yes, because Lanewood is adj acent to the
Ci ty limits and is generally surrounded by other
257 NANCY MERRILL, Di
Ci ty of Eagle
developments that will be included in the City, Lanewood
will , in effect, be part of the City of Eagle.It will
use City amenities, its traffic will affect the City and
its citizens, and its homeowners will use the amenities
that the City offers.Furthermore, because properties
wi thin the City of Eagle have traditionally higher
values, it will be able to use that circumstance to its
benefit.
258 NANCY MERRILL , Di
Ci ty of Eagle
Homebuyers in Lanewood will be able to take advantage of
the benefits of the City without paying for them.
shown at Exhibit 201, Lanewood is surrounded by
properties in some phase of being included wi thin the
City.Lanewood should be part of the City of Eagle.
When you refer to the City s planning
efforts, can you describe in general terms what you mean?
As with any local governmental body, the
Ci ty of Eagle develops a Comprehensive Plan pursuant to
Idaho Code.This plan deals with features such as
planning and zoning matters, transportation, and City
services.In effect, the Comprehensive Plan and
associated documents detail how the City is to look and
feel , how it is to grow , and how it will provide for its
citizens.
The City of Eagle takes this obligation very
seriously.That is why the City of Eagle is one of the
most desirable places to live in the Treasure Valley.
care about the City of Eagle and believe the results of
that caring and attention reflects the importance that
people who live here place on maintaining the core values
and concepts that make Eagle what it is today.These
planning efforts include items such as providing City
services, including water.We would like to think we
would have the support of the Public Utilities Commission
259 NANCY MERRILL , Di 3
City of Eagle
in helping the City develop according to its planning
efforts.A copy of portions of the City s Comprehensive
Plan addressing water is attached as Exhibit 202.
260 NANCY MERRILL, Di
City of Eagle
Has this planning process included the
land which is being developed as the Lanewood
development?
Yes, it has.Lanewood will be located in
the midst of the City of Eagle.How Lanewood is
developed will have a significant influence on the City.
We hope and intend to see that it is developed consistent
wi th the City s Comprehensive Plan.
Did United Water participate or comment on
development of the City s Comprehensive Plan?
No, not that I am aware of , although the
Ci ty did notify United Water that it was developing its
plan.
Is the City capable of providing water
service to the Lanewood development?
Yes, it is.The City is committed to
working with the developer to incorporate this
development into the City.Even though the developer has
filed an application with the county, the City of Eagle
will participate in that proceeding.
Why would the City take that position?
Lanewood will,for all practical aspects,
in the City.not developed consistent with the
Ci ty ' s Comprehensive Plan , it could have significant
detrimental effects on the City.
Ci ty ' s planning process and
It would disrupt the
261 NANCY MERRILL, Di
Ci ty of Eagle
would negatively affect the City s water system
development, roads, and open spaces in its western area.
The developer of Lanewood has stated that
the City will not have a completed well and other
facili ties ready by time it has approval to commence
construction.Do you believe that to be true?
No, I do not.According to the City
staff, the City has already constructed a well and a
mainline is being constructed now.This line will go to
the southern boundary of Lanewood.The county approval
process will likely take longer to complete than will the
extension of the mainline to Lanewood.By the time
Lanewood completes the county approval process and is
ready to utilize water, the City s system will be ready.
What is the City s policy on how water
to be provided to new developments wi thin the City?
The City believes that new developments
should provide their own water in order not to impose
burdens and costs on existing customers.Since the City
does not seek to generate profits from its water system,
the City believes it can provide water to its ci ti zens
less expensively than a for-profit entity such as United
We believe water customers would appreciate that.Water.
262 NANCY MERRILL , Di
Ci ty of Eagle
Do you know the basis for Mr. Ramon
Yorganson s statements that the review process for his
development will be shorter because United Water can
independently lift sanitary restrictions to start
construction but the City cannot do the same thing?
No, I do not know the basis for this statement, but Mr.
Yorganson is incorrect.The City can also lift the
restrictions.I firmly believe that Mr. Yorganson ' s
proj ect, if developed according to the City
Comprehensive Plan, can be approved faster than through
the county process.The City will certainly seek to work
wi th him to do that.With his cooperation , I believe
that can be done.If Mr. Yorgason is concerned about
cost and certainty, given the location of his
development, I believe the City provides a superior
al ternati ve to development than does the county.
Mayor, I am committed to helping him develop in a way
that brings value to his proj ect and new citizens to
I believe that the homeowners, who are ultimatelyEagle.
the customers, will appreciate the lower costs and
services that the City can provide.Ci ty Hall and my
office are a ten-minute ride from the Lanewood
development.If the customer has a problem, they can
come see me or any of the City staff.I believe it is in
the public interest for the City to serve these
homebuyers, not United Water.
263 NANCY MERRILL , Di
Ci ty of Eagle
matter?
Please state your name.
My name is Nancy Merrill.
Have you previously submitted testimony in this
Yes, I have.
Have you reviewed the testimony of Mr. Ramon
Yorgason?
Yes.
you
Yes.
have any response to that testimony?
He indicates that he expects to complete
the hearing process with the County by May, 2007.The
Ci ty ' s recommendations on the application were requested
by Ada County.The City Planning and Zoning held a
hearing on the staff recommendation on May 7 , 2005.The
Ci ty Council has the matter on its agenda for May 22,
2007.The Staff recommendation and analysis of the
application is attached as City of Eagle Exhibit 205.
The recommendation is for approval of the requested
application.
See City of Eagle Exhibit 206.
264 NANCY MERRILL, Di-Reb 2
Ci ty of Eagle
(The following proceedings were had in
open hearing.
COMMISSIONER SMITH:Mr. Woodbury, do you
have questions?
MR. WOODBURY:Thank you, Madam Chair.
Staff has no questions of Mayor Merrill.
COMMISSIONER SMITH:Okay, Mr. Burns, do
you have questions?
MR. BURNS:No, I have no questions.
Thank you.
COMMISSIONER SMITH:And Mr. Miller?
MR. MILLER:We have no questions.
COMMISSIONER SMITH:Does the Commission
have any questions of the Mayor?
COMMISSIONER REDFORD:No.
COMMISSIONER SMITH:Then you have no
redirect.
MS.BUXTON:That'correct.
COMMISSIONER SMITH:Thank you, Mayor.
THE WITNESS:Thank you.
(The witness left the stand.
COMMISSIONER SMITH:Does the City have
any other witnesses?
MS. BUXTON:We do not.
MR. SMITH:We do not.
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265 MERRILL
Ci ty of Eagle83676
COMMISSIONER SMITH:Well, it appears we
have come to the magic moment of being concluded, unless
anyone wishes to correct me.
Mr. Miller.
MR. MILLER:If the Commission would
permit, I would like to make just a brief concluding
comment.
COMMISSIONER SMITH:Always happy to have
brief concluding comments from anyone who wishes to offer
them.As the applicant, would you wish to also go last,
assuming others have brief concluding comments?
MR. MILLER:d prefer to go first and
last.
COMMISSIONER SMITH:I see.Please
proceed.
MR. MILLER:Thank you, Madam Chairman,
Members of the Commission.I just wanted to follow up
briefly on a discussion we had this morning regarding the
scope of the Commission s inquiry and the Commission , I
think, correctly identified the scope of its inquiry and
it also indicated properly that there are some specific
criteria to be applied and then there is some more
general public interest criteria, and I I ve had
opportuni ty to think a little bit about this public
interest criteria.
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266 COLLOQUY
83676
In almost all of United Water s cases like
this, the public interest never becomes a specific
concern.There is a developer who requests service,
Uni ted Water has the ability to serve, it's obviously in
the public interest for that to occur, which is true
here, but since the public interest concept has perhaps
taken on a bigger, or at least a potentially bigger, role
in this case, I had a few thoughts on what properly is
considered under that criteria.
I think the first obvious observation is
that public interest criteria should be ones that are
wi thin the scope of the Commission s scope of inquiry.
It would obviously be in the public interest if the
conflict in Iraq came to an end, but that's not wi thin
the Commission s scope of consideration.Similarly, the
ability and the desire of some other provider to provide
service and the legal or practical ability of that
provider to provide service the Commission has indicated
is not a primary criteria wi thin its scope of interest,
so by definition, it somehow should not become a public
interest criteria.
There are some things that I think do
tradi tionally fit wi thin the public interest criteria as
it might apply here.For example, the Commission is
sometimes concerned of whether a course of action would
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Wilder , Idaho
267 COLLOQUY
83676
resul t in economic waste or duplication of services.The
fact here is that the City seeks to duplicate services
that United Water or facilities that United Water already
has in place, so granting United Water I s application
would not result in economic waste, unnecessary
duplication of service that drives up the cost of
providing water generally.
Another public interest factor that the
Commission has considered, for example, in the Avimor
case, for example, is the effect of the application on
existing ratepayers of the regulated company about whom
The evidence here, obviously, is that there isyou care.
almost no new investment required by United Water to
serve this development.There will, however, be
measurable new revenue from the development which you, of
course, will capture in the next rate case; thus,
reducing pressure on United Water s revenue requirement
and costs to other customers.
A third public interest criteria that
think you may properly consider is the cost to the
individual involved.The individual involved has
indicated that the cost of delay, the cost of doing
anything other than being immediately served by United
Water is measurable, significant, perhaps overwhelming.
The Commission, I think, can properly consider whether a
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Wilder, Idaho
268 COLLOQUY
83676
course of action drives up the cost to individuals or
not.
The Commission it seems to me can consider
the fact that United Water seeks to have harmonious
relations with its customers, not to litigate with them
and I think the Commission can consider whether to, in
effect, reward a party who in my opinion violates the
obligation of candor to the tribunal in not fully
disclosing information that was relevant to the
Commission s decision , so just having a day to think
about it, those are some of the criteria that I think the
Commission can properly consider in its public interest
evaluation, and when it does, I think it comes inevitably
to the conclusion that the certificate expansion should
be granted and in light of Mr. Yorgason ' s testimony and
gi ven the amount of time that's gone on in this case, we
hope it could be done as expeditiously as possible, so
those are my thoughts.
Thank you.
COMMISSIONER SMITH:Do we have any
questions for Mr. Miller?
COMMISSIONER REDFORD:No.
COMMISSIONER SMITH:Mr. Burns.
MR. BURNS:I will just join Mr. Miller in
his comments.Thank you.
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COMMISSIONER SMITH:Mr. Woodbury, are you
get ting in this?
MR. WOODBURY:No.
COMMISSIONER SMITH:Thank you.
Ms. Buxton or Mr. Smi th?
MS. BUXTON:Madam Chairman and Members of
the Commission, I understand Mr. Miller s one-sided view
of what the public interest is and there is a lot of
public interest that boards like you have to look at.
There s public interest that the City Council has to look
at and I think that the public interest is something that
is not as narrow as Mr. Miller is suggesting and I would
suggest that or even offer that if even if you took this
under advisement today that we would all be given the
opportuni ty to brief the public interest from a legal
perspecti ve for you and given that, I've been instructed
by my client that Mayor Merrill would like to make a
statement with regard to the public interest as at least
she believes it and as a client, she has the ability to
speak instead of her lawyers.
MR. MILLER:This isn t the Buhl City
Council.We actually have procedures here and a last
minute statement by a witness is not one of them.There
ought to be some adherence to procedures that are
designed to ensure fairness to all the parties and last
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minute statements by witnesses who
--
well , just last
minute, unsworn statements by witnesses are not
contemplated and they re not fair to other parties.
MR. BURNS:I would join that by noting
that Mayor Merrill elected not to provide any
supplemental testimony to open herself up to
cross-examination and it seems peculiar to allow a
wi tness to now join on the back side after she s no
longer exposed to cross-examination and say whatever she
wants, so I join in the obj ection to Mayor Merrill
providing such a statement at this time.
COMMISSIONER SMITH:Ms. Buxton?
MS. BUXTON:Then I would obj ect and ask
that Mr. Miller
--
all his statements be stricken from
the record because there was no unrebutted testimony to
her public interest testimony that was already provided
in her direct and supplemental direct testimony, so that
is what you have on the record with regard to the public
interest as far as the testimony, so with that being
said, again, I have just been instructed by my client
that she would like to make a final statement.Again , I
don t believe that Mr. Miller s statement was any more
than trying to put forth his client I s point of view with
regard to unrebutted testimony that you have with regard
to the public interest.
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COMMISSIONER SMITH:Well , let me tell you
how I'm going to resolve this.I think that generally
Mr. Miller is correct.We don t allow witnesses to come
up after their testimony and make statements; however,
it's not often that we have a mayor who is our witness
and I would remind Mayor Merrill that she s still sworn
and in the interest of accommodating one decision making
body to another public official , I think I I d let her.
Now , if she does say something that you
think warrants cross-examination or further argument, I '
certainly open to that request, so Madam Mayor.
MAYOR MERRILL:Thank you very much.
appreciate that and I don t have a lot to say.
COMMISSIONER SMITH:It would probably be
better for the reporter if you sat in front of the mic.
Thank you.
MAYOR MERRILL:Than k you.This has been
a long and arduous hearing and it's not been fun , I would
tell you that.I apologize.We have known these people
for a long time personally and publicly and In no way do
we want to injure them.I was hoping that we could come
to some conclusion and I don t believe that always a
court is the best place for that.We honestly, truly
thought we were helping Capital Development from our last
hearing to today as we went out to try to find a lease, a
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water lease, that would supplement anything that would
delay them.
We were in contact with them regularly.
myself even contacted them and said I think we have a
solution.I think we have a water lease that's going to
cover this gap before our final solution, and we really
think that that would work and we want it to work and we
believe that the lines are there and everything is ready
to go, but even with that, there s things to be
--
some
concern and some trust that is missing here.m going
to throw something out.I know that none of the
attorneys have heard this and I don t know if the
Commission would even agree, but as a Mayor, you can fire
me.
COMMISSIONER SMITH:No, I can
MAYOR MERRILL:m at about my last end
on this, so several years ago we ended up in this same
si tuation with a development by Mr. Homichea called
Brookside in which we did not have a decision from IDWR
on a well and we entered into an agreement with United
Water to temporarily allow them to serve to allow their
subdivision to go through, their plats to come in, their
buildings to go up while we were wrestling through this
decision.We today do have that newIt worked.
Brookwood well ready to go on line and we re ready to
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serve that.It's been a long period of time and I think
that that's probably why the applicant is concerned.
The City of Eagle never seems to do
anything easy.We always seem to run up against walls or
get our nose stubbed somewhere, but we are trying to
preserve the water in our area.We are trying to work
wi th our aquifers.That's why we have the wells that we
We are trying to integrate our system.We arehave.
trying to provide a full-blown water system that will
serve thousands of customers and ci ti zens throughout the
future.
We believe that we are trying to do it in
the right manner , but if this is indeed an issue with Mr.
Yorgason and the family out there as they re trying to
move this thing through , I'm sure willing, I don t know
if my attorneys are, to try to find a solution with this
and allow them to move forward.If we keep allowing
these certificate areas to move forward on a piece by
piece and an inch by inch as you will see more of them,
we are going to be here a long period of time trying to
do this and we do need a solution and we do need an end
to these as we ve got a master plan.I know United Water
is trying to work there, we re trying to work through
some other issues with them and I guess what I'm trying
to tell you is we re willing to try to resolve this in
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the best manner that we can if you ll give us a chance.
COMMISSIONER SMITH:Thank you,
Madam Mayor.I guess I would just note that I think the
Commission some time ago in terms of years had a docket
to try and geographically divide the Eagle area between
water providers that exist there and I suspect that case
is still open , so maybe we should check into it.
Are there questions or comments from the
Commission?
COMMISSIONER KJELLANDER:No.
COMMISSIONER REDFORD:No.
COMMISSIONER SMITH:Any need from the
attorneys to provide anything further?I know Mr. Miller
as the applicant gets the last shot.
re content with the recordMR. MILLER:
as it stands.
As is Capital Development.MR. BURNS:
Thank you.COMMISSIONER SMITH:Well , I
want to thank all the parties for their courteous and
expedi tious participation in today ' s oral argument and
hearing.We do appreciate that.The Commission will
take this under advisement and issue as speedily as
possible our decision in this matter.We do understand
the time constraints the developer is under and we always
endeavor to be as quick as we can in deliberating a
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matter that's fully submitted before us, so we determine
that this matter of the certificate amendment is fully
submi tted and we will deliberate on it as speedily as
possible.Thank you all and we re adj ourned.
(All exhibits previously marked for
identification were admitted into evidence.
(The Hearing adjourned at 3:45
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276 COLLOQUY
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This is to certify that the foregoing
proceedings held in the matter of the application of
Uni ted Water Idaho Inc. to amend and revise certificate
of convenience and necessity No. 143, commencing at
9:30 m., on Monday, September 24, 2007 , at the
Commission Hearing Room, 472 West Washington Street,
Boise, Idaho, is a true and correct transcript of said
proceedings and the original thereof for the file of the
Commission.
Accuracy of all prefiled testimony as
originally submitted to the Reporter and incorporated
herein at the direction of the Commission is the sole
responsibility of the submitting parties..
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CONSTANCE S. BUCY
Certified Shorthand Reporter #187
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277 AUTHENTICATION
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