20100108UWI to Staff 246.pdf

McDevitt & Miller LLP
Lawyers
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[phone]
[phone] (Fax)
420 W. Bannock Street
P.O. Box 2564.83701 10\ U JAN - 8 AM": 33
Boise, Idaho 83702
Januar 8, 2010
Via Hand Delivery
Jean Jewell Secretary
Idaho Public Utities Commssion
472 W. Washigton St.
Boise, Idaho 83720
Re: Case No. UWI-W-09-01
General Rate Case Filng
Dear Ms. Jewell:
Enclosed for fig, please fid thee (3) copies of United Water Idaho's Four Response to
Commssion Staffs Eleventh Production Request No. 246.
Kidly retu a fie stamped copy to me.
Very Truy Your,
McDevitt & Mier ll
DJM/hh
Encl.
Chas. F. McDevitt
Dean J. (Joe) Miler
ORIGINAL
Dean J. Miler (ISB No. 1968)
McDEVITT & MILLER LLP
420 West Banock Street
P.O. Box 2564-83701
Boise, Idaho 83702
Tel: [phone]
Fax: [phone]
joeßYmcdevitt -miler. com
t:
ZO\U JAN -8 MH\: 33
Attorneys for United Water Idaho Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
UNITED WATER IDAHO INC., FOR )
AUTHORITY TO INCREASE ITS RATES AND)
CHARGES FOR WATER SERVICE IN THE ~STATE OF IDAHO )
)
CASE NO. UWI-W-09-01
UNITED WATER IDAHO INC'S
FOURTH RESPONSE TO
COMMISSION STAFF'S
ELEVENTH PRODUCTION
REQUESTS
United Water Idaho Inc, ("United Water") by and though its undersigned attorneys,
hereby submits its Fourh Response to the Commission Staffs Eleventh Production Request No.
246.
DATED this --day of Januar, 2010.
UNITED WATER IDAHO INC.
BY:Gl~
Dean '). Miler
McDevitt & Miler LLP
420 West Banock
Boise, Idaho 83702
P: 208.343.7500
F: 208.336.6912
Attorney for United Water
UNITED WATER IDAHO INC'S FOURTH RESPONSE TO COMMISSION STAFF'S ELEVENTH
PRODUCTION REQUESTS- i
CERTIFICATE OF SERVICE
I hereby certify that on the ~ay of Januar, 2010, I caused to be served, via the
methodes) indicated below, tre and correct copies ofthe foregoing document, upon:
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P.O. Box 83720
Boise, ID 83720-0074
jjewell(fpuc.state.id. us
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
Brad M. Purdy
Attorney at Law
2019 N. 17th Street
Boise, ID 83702
bmpurdy(fhotmail.com
Hand Delivered
U.S. Mail
Fax
Fed. Express
Email
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UNITED WATER IDAHO INC'S FOURTH RESPONSE TO COMMISSION STAFF'S ELEVENTH
PRODUCTION REQUESTS- 2
UNTED WATER IDAHO INC.
CASE UWI-W-09-01
ELEVENTH PRODUCTION REQUEST OF THE COMMISSION STAFF
Preparer/Sponsoring Witness: Kevin Doherty
REQUEST NO. 246:
In Case No. UWI-W-06-02, Exhibit NO.5 (Accumulated Deferred Federal Income Taxes), line
4, the amount of $2,470,159 was identified as Account 253-87, Deferred Advances and
Contributions Gross Up related to the Tax Reform Act of 1986. In Exhibit No. 13, Schedule 8
(Accumulated Deferred Income Taxes) of the curent case there is no such referenced amount.
Please identify the status of that account/amount and explain how and why the account/amount
has changed.
RESPONSE NO. 246:
In 1986, the Federal ta laws (TRA-86) were changed to make Contributions in Aid of
Constrction and Customer Advances taxable to the Company. As a result of that tax law
change, deferred taxes were required related to this income. Since the Company was not, at that
time, recording Deferred State Income taxes on its books and records, the amount related to
Deferred State Income taxes when CIAC/ advances were received was recorded in a deferred
credit account named Deferred Advances and Contrbutions Gross-Up (account 25387).
At the end of 2006, the Company's outside auditor, Ernst and Young, required the Company to
perform a detailed analysis of all of its tax accounts in order to meet the requirements of
Sarbanes Oxley. The study took several months to complete and when completed, it, in effect,
rebuilt the deferred tax accounts to the level that was deemed appropriate under the Sarbanes
Oxley provisions. The Federal and State Deferred tax balances on the books of the Company
were revised to agree to the balances determined in the tax analysis study. In 2007, the Company
wrote off to miscellaneous income the balance in account 25387. This account was no longer
required since all deferred Federal and State tax accounts had been adjusted to a level where the
study showed they should be based on historical data. Since the amount in this account was
created for Deferred State income taxes, and since the Company's State Income tax accounts
now contained the correct balance, the amount in account 25287 was a duplication of taxes and
was removed from the books of the Company.