20190125notice_of_hearing_order_no_34209.pdf

Office of the Secretary
Service Date
January 25,2019
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE INVESTIGATION )CASE NO.ATL-E-18-01
OF ATLANTA POWER COMPANY )
SERVICE AND CUSTOMER RELATIONS )ORDER NO.34209
)NOTICE OF HEARING &
)ORDER TO SHOW CAUSE
This matter comes before the Commission on the Commission Staff's request for an order
directing Atlanta Power Company ("AtlantaPower"or "Company")to appear and show cause
why the Commission should not require the Company to immediately:
1.File verified returns of its gross operating revenues in 2017 and 20 18 for calendar years
2016 and 2017;
2.Pay $103 in past due regulatory fees and interest (i.e.,the statutory minimum of $50
per year for calendar years 2016 and 2017,with $3 in interest);and
3.Pay $12,000 in civil penalties for having violated the Idaho Public Utilities Law,Idaho
Code §§61-101 et seq.
Having reviewed the record,we order the Company to appear before the Commission on
February 19,2019,to show cause as discussed below.
JURISDICTION
Atlanta Power is an "electrical corporation"as defined in Idaho Code §61-119,and a
"public utility"as defined in Idaho Code §61-129.The Commission has jurisdiction over Atlanta
Power and the issues in this case under the Public Utilities Law,Idaho Code §§61-101 et seq.,
including Idaho Code §61-501 (vesting the Commission with the "power and jurisdiction to
supervise and regulate every public utility in the state and to do all things necessary to carry out
the spirit and intent of"the Public Utilities Law),and Idaho Code §61-701 et seq.(directing the
Commission as to enforcement,penalties,and interpretation of Public Utilities Law).
BACKGROUND
1.Customers Complainof InadequateService.
In the spring of 2017,Atlanta Power customers informally complained to Commission
Staff that the Company was providing inadequate electric service.The customers relayed that the
Company's hydroelectric turbine was not working.Instead,the Company was using its diesel
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generator to provide electric service,and the generator was regularlyrunningout of fuel causing
significant service outages.Customers also complained that the Company does not have a
representative for them to contact when service issues arise.
Subsequently,on January 2,2018,Atlanta Power customer Mary Drake filed a formal
Complaint alleging the Company was violating Commission Order No.31086 and Idaho Code §
61-302 by not maintaining adequate service.
2.Commission Issues Summons and Orders an Investigation.
When a customer files a formal Complaint,the Commission must decide how to process
it.See Rule 54 (Formal Complaints -Defined -Contents and Process).As to Ms.Drake's formal
Complaint,the Commission's Staff recommended that the Commission:(1)issue a summons
requiring Atlanta Power to respond to Ms.Drake's formal Complaint;and (2)direct Staff to
investigate the Company,with a focus on service reliability,maintenance and operation of the
Company's facilities,and customer service.As part of its investigation,Staff would review the
Company's compliance with past orders,inspect the Company's generation and distribution
facilities,confer with customers,and issue discovery requests to the Company.See January 22,
2018 Staff Decision Memorandum.
On February 20,2018,the Commission approved Staff's recommendation.The
Commission ordered its Staff to investigate the informal complaints of Company customers,and
the Company's service reliability,maintenance and operations,and customer relations.Staff was
to work with the Company and its customers to investigatethese issues,identifypossible solutions
and provide a report detailing Staff's findings within six months.The Commission directed the
Company to "respond to the Formal Complaint of Mary Drake"and "respond to any inquiries"
from Commission Staff."See Order No.33988.
The Commission issued the Company additional summonses on March 8,2018,again
directing it to respond in writing to Ms.Drake's formal Complaint,and respond to inquiries from
Commission Staff.On March 16,2018,Staff asked 14 questions through production requests made
to the Company as part of Staff's investigation.
3.CompanyFails to Respond.
The Company was required to respond to the requests by April 6,2018.No responses were
received by the April 6 deadline.On May 15,2018,the Company's bookkeeper,Linda Churches
responded to production requests 1 -3 stating that she does not have access to the requested
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information.On August 7,2018,Staff mailed the Company notice that failing to respond may
result in further Commission action,includingthe imposition of civil penalties.See Affidavit of
Johnathan Farley at 2,attached as Exhibit 1.
According to Staff,throughoutits investigation,Staff has been unable to contact the
Company's owner and sole representative,Israel Ray.Mr.Ray's brother,Ronald "Gene"Ray,has
represented to Staff by telephone that he is caring for Israel,who is experiencing medical issues,
and is managinghis affairs,includingissues related to the Company.See December 28,2018,Staff
Report at 8,attached as Exhibit 3.Gene has expressed that he is not an employee or agent of the
Company,and he has refused to provide any written response to Staff or the Commission.Id.To
date,no written response or communication has been produced by the Company,except for the
limited response to Staff production requests 1 -3 by the Company's bookkeeper,as noted above.
Additionally,no power of attorney documents have been provided to substantiate Gene Ray's role
in Israel Ray's affairs.
Staff has attempted to obtain the Company's written response to Ms.Drake's formal
Complaint and to inquiries as part of the Commission-ordered investigation.Farley Affidavit at 1-
2.Staff provided requests via certified mail with a return receipt evidencing the requests.Id.
Nevertheless,the Company has failed to respond to the formal Complaint,or respond to Staff
informational requests,except as noted above.Id.
The Company's failure to:1)comply with Commission Order;2)provide a written
response to the formal Complaint;and 3)respond to Staff informational requests are unique
violations of Idaho Code.See Idaho Code §§61-706 and 61-707.
4.Non Paymentof Annual Regulatory Fees.
The Commission is funded through regulatory fees assessed each year on utilities under
the Commission's jurisdiction.Idaho Code §61-1003 requires that,"[o]n or before April lst of
each year,each public utilityand railroad corporation subject to the jurisdictionof the commission,
shall file with the commission a return verified by an officer or agent of the public utilityor railroad
corporation involved,showing its gross operating revenues from its intrastate utility or railroad
business in Idaho for the preceding calendar year during which it carried on such intrastate utility
or railroad business."
Based on reporting and review of a utility's(or railroad's)gross operating revenues,Idaho
Code §61-1001 authorizes the Commission to assess "a special regulatory fee in such amount as
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the commission shall find and determine to be necessary,togetherwith the amount of all other fees
paid or payable to the commission by each such public utility and railroad corporation ...."The
Commission notifies the utilityofits regulatory fee by May 1 of each year.The regulatory fee may
be paid to the Commission in equal semi-annual installments due May 15 and November 15.Id.
Any utility may object to its regulatory fee "on or before the time specified for payment of the first
installment of the assessment made against it."Id."Upon failure,refusal or neglect of any public
utility or railroad corporation to pay such a fee the attorney general shall commence an action in
the name of the state to collect the same."Idaho Code §61-1005.
Atlanta Power has failed or refused to file its annual verified return showing its gross
operating revenues from its intrastate utility business in Idaho in 2017 and 2018 for calendar years
2016 and 2017.The Company has further failed or refused to pay its assessed fees in 2017 and
2018 for calendar years 2016 and 2017.See Affidavit of Nancy Asheraft [in]Support of Order to
Show Cause (Exhibit No.2).On multipleoccasions,the Commission has attempted to obtain the
Company's verified returns and collect its annual fee through sending invoices,demand letters,
and notification that failure to comply would result in legal action.Id.Nevertheless,the Company
has failed to meet the Commission's directives that it file annual returns and pay outstanding fees.
Id.
FINDINGS AND CONCLUSIONS
1.Idaho Code §§61-401 and 406
Idaho Code §61-401 states,"[e]very public utility shall furnish to the commission,in such
form and such detail as the commission shall prescribe,all tabulations,computations and all other
information required by it to carry into effect any of the provisions of this act and shall make
answers to the best of their knowledge,to all questions submitted by the commission."Further,
Idaho Code §61-406 states,"[e]very public utility shall obey and comply with each and every
requirement of every order,decision,rule or regulation made or prescribed by the commission in
the matters herein specified,and shall do everything necessary or proper in order to secure
conapliance with and observance of every such order,decision,direction,rule or regulation by all
of its officers,agents and employees."
Since February 2018,the Company has repeatedly failed to comply with the Commission's
requests,directives,order,and summons to "respond to the formal Complaint,"and "respond to
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any inquiries"from Commission Staff.Order No.33988.The Company can remedy this
deficiency by responding to the formal Complaint and all related inquiries in writing.
2.Idaho Code §§61-602,603 and 610
Idaho Code §61-610(1)provides that "[t]he commission,each commissioner and
[Commission Staff]shall have the right at any and all reasonable times to inspect the accounts,
books,papers and documents of any public utility...."Together,with Idaho Code §§61-602 and
603,the Commission and Commission Staff have the power to compel the production of papers,
books,accounts and documents of public utilities.Under these statutes,and the Commission's
broad regulatory powers,a utility is required to provide all utility documents,and respond to all
inquiries related to the utility.See Application of Lewiston Grain Growers,69 Idaho 374,378
(1949).
Staff has attempted to exercise its statutory right to examine and audit the Company's
documents.Staff also served discovery requests on the Company in this case.Despite repeated
requests,the Company has failed to provide Commission Staff with any information related to the
Company,including account information,ownership status,and documents related to customer
identities,outages,hydroelectric turbine information,diesel generation information,fuel capacity
and purchases,utility equipment information,and company planning.Discovery was first
attempted by Staff on March 16,2018.Information provided by the Company's bookkeeper was
not responsive to Staff's request.Thus,the Company remains obligated to respond to these
requests.
3.Idaho Code §§61-1001 and 1003
Idaho Code §61-1003 requires the Company to file annual verified returns showing gross
operating revenues from its utility business in Idaho for the preceding calendar year.Idaho Code
§61-1001 requires the Company to pay the Commission an annual regulatory fee based on the
Company's annual verified return.
The Company failed to file annual verified returns in 2017 and 2018 showing its gross
operating revenues for 2016 and 2017.Each failure to file creates a distinct and unique cause of
action.Also,in 2017 and 2018,the Company failed to pay its annual regulatory fee for calendar
years 2016 and 2017,respectively.The Commission assessed $50 per year because Commission
Staff was unable to calculate an accurate assessment amount due to the Company's failure to
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ORDER NO.34209 5
submit annual verified returns.The Company remains obligated to file its verified returns and pay
its outstanding regulatory fees,plus interest,for calendar years 2016 and 2017.
4.Idaho Code §61-701,et seq.
The Company is obligated to pay civil penalties for violations of the above-referenced
statutes.Specifically,Idaho Code §61-706 states:
Any public utility which violates or fails to comply with any provisions of the
constitution of this state or of this act,or which fails,omits or neglects to obey,
observe or comply with any order,decision,decree,rule,direction,demand or
requirement or any part or provision thereof,of the commission,under the
provisions of this act,in a case in which a penalty has not hereinbefore been
provided for,such public utility is subject to a penalty of not more than $2,000 for
each and every offense.
We find that the Company has violated the Public Utilities Law no less than six times:
1)Violation of Idaho Code §61-401 -$2,000
2)Violation of Idaho Code §61-610 -$2,000
3)Violation of Idaho Code §61-1003 -2 years of failing to report -$2,000 x 2 =$4,000
4)Violation of Idaho Code §61-1001 -2 years of failing to pay assessment -$2,000 x 2
=$4,000.
Atlanta Power is also subject to $100 in unpaid regulatory fees,plus $3 in interest,
consequently the Company is subject to a total of $12,103 in penalties and fees.We find it
reasonable to direct the Company to appear and show cause why the Commission should not order
these amounts immediately due.
Furthermore,Idaho Code §61-707 states:
Every violation of the provisions of this act or of any order,decision,decree,rule,
direction,demand or requirement of the commission,under the provisions of this
act,or any part or portion thereof,by any public utility,corporation or person is a
separate and distinct offense,and in case of a continuing violation each day's
continuance thereof shall be and be deemed to be a separate and distinct offense.
Failure to comply with this order to show cause will result in a continuing violation of §61-706
subjects the Company to a penalty of $2,000 per day until the Company satisfies its obligations.If
the Company fails to comply with this order,the Commission may direct the Commission's
attorneys to sue in District Court to enforce these penalties consistent with Idaho Code §§61-701,
705 and §61-1005.
ORDER TO SHOW CAUSE
NOTICE OF HEARING
ORDER NO.34209 6
NOTICE OF HEARING
YOU ARE HEREBY NOTIFIED that the Commission will hold a hearing in this matter
on TUESDAY,FEBRUARY 19,2019,COMMENCING AT 10:00 A.M.IN THE
COMMISSION HEARING ROOM,472 W.WASHINGTON STREET,BOISE,IDAHO.
The purpose of this hearing is to allow the Company to explain why the Commission should not
declare all fees and interest immediately due and impose penalties.
YOU ARE FURTHER NOTIFIED that all hearings and prehearing conferences in this
matter will be held in facilities meeting the accessibility requirements of the Americans with
Disabilities Act (ADA).Persons needingthe help of a sign language interpreter or other assistance
in order to participate in or to understand testimony and argument at a public hearing may ask the
Commission to provide a sign language interpreter or other assistance at the hearing.The request
for assistance must be received at least five (5)workingdays before the hearing by contacting the
Commission Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-Mail:[e-mail]
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted
pursuant to the Commission's Rules of Procedure,IDAPA 31.01.01.000 et seq.A copy of the rules
is available for review at the Commission's offices during regular business hours,and on the
Commission's website at www.puc.idaho.gov.
ORDER TO SHOW CAUSE
NOTICE OF HEARING
ORDER NO.34209 7
ORDER
Based on the evidence before the Commission,and good cause appearing,
IT IS HEREBY ORDERED that Atlanta Power shall appear beforethe Commission on
February 19,2019,to show cause why the Commission should not summarily order Atlanta Power
to immediately:
1.Pay the entire outstanding annual fee amount of $100,and $3 in interest;
2.File its statutorilyrequired annual verified returns for calendar years 2016 and
20 17;and
3.Pay civil penalties under Idaho Code §61-706 of $2,000 for each and every
offense,totaling $12,000.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of January 2019.
PAUL KJ LLAND ,PRESIDENT
KRISTINE RAPER,COM SIONER
ERIC ANDERSON,COMMISSIONER
Diane M.Hanian
Commission Secretary
I:\Legal\ELECTRIC\ATL-E-18-01\Orders\ATLE1801_OSC_bkfinal docx
ORDER TO SHOW CAUSE
NOTICE OF HEARING
ORDER NO.34209 8
BRANDON KARPEN,ISB No.7956
Deputy AttorneyGeneral
State of Idaho
Public Utilities Commission
472 W Washington
P.O.Box 83720
Boise,Idaho 83720-0074
Telephone:[phone]
[e-mail]
Attorneyfor the Staffof the Public Utilities Commission
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE INVESTIGATION )CASE NO.ATL-E-18-01
OF ATLANTA POWER COMPANY )SERVICE AND CUSTOMER RELATIONS )AFFIDAVIT OF JOHNATHAN
)FARLEY SUPPORT OF ORDER
)TO SHOW CAUSE
JOHNATHAN FARLEY,being duly sworn,stated:
1.My name is Johnathan Farley.I am over 21 years of age,of sound mind,and I
have personal knowledge of the facts stated herein.
2.I am a Utilities Compliance Investigator at Idaho Public Utilities Commission.I
started working in this position in June 2015.I am responsible for leading the investigation into
the service reliability,maintenance and operations,and customer relations of Atlanta Power
Company.
3.On February 21,2018,the Commission issues,by certified mail,a summons to
Atlanta Power Company notifying it that a Complaint had been filed against the Company,that
the Commission had order a Staff investigation into service reliability,maintenance and
operations,and customer relations of the Company.The Summons directed the Company to file
a written answer or written motion in defense of the Complaint within twenty-one days.To date,
the Company has not filed a written answer or motion in response to the summons.
4.On March 8,2018,the Commission issued,by certified mail,a second copy of the
summons to Atlanta Power Company directing the Company to file a written answer or written
motion in defense of the Complaint.Simultaneously,a summons was mailed to the Company'sonlyemployee.To date,the Company has not filed a written answer or motion in response to the
summons.
AFFIDAVIT OF JOHNATHAN FARLEY l
Exhibit 1
5.On March 16,2018,Staff propounded 14 production requests on the Company by
certified mail.To date,the Company has not filed any answers or responses to the production
requests.
6.On April 6,2018,the Atlanta Water Association,and the Atlanta Landowner's
Association (jointly,"AWA/ALA")intervened as parties in this case,which was granted on
April 19,2018.Order No.34036.On May 7,2018,AWA/ALA propounded 3 production
requests on the Company.An Atlanta Power Company employee responded to the request
reporting that the Company's owner,Israel Ray,was the only person with access to the requested
information,and otherwise denied access to the requested information.Accordingly,to date,the
Company has not filed any answers to the production requests.
7.On August 7,2018,Staff mailed a Mr.Ray a letter notifying him that failing to
respond to the Commission's summons,and the production requests may cause the Company to
incur fines for failing to comply with a Commission order,and Idaho Public Utilities Law.Staff
attached a copy of the Commission summons,and the production requests to the letter.To date,
the Company has not filed a written answer or motion in response to the summons,or provided
Staff with any answer to its production requests.
Dated this i C day of November,2018.
B :Johnathan Farle
Utilities Compliance Investigator
Idaho Public Utilities Commission
SUBSCRIBED AND SWORN to before me this 41 day of November,2018.
sTATE op OAHO Notary Public Ëor Idaho
My commission expires on \L \10 6
AFFIDAVIT OF JOHNATHAN FARLEY 2
BRANDON KARPEN,ISB No.7956
Deputy AttorneyGeneral
State of Idaho
Public Utilities Commission
472 W Washington
P.O.Box 83720
Boise,Idaho 83720-0074
Telephone:[phone]
[e-mail]
Attorneyfor the Staff of the Public Utilities Commission
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE INVESTIGATION )CASE NO.ATL-E-18-01
OF ATLANTA POWER COMPANY )
SERVICE AND CUSTOMER RELATIONS )AFFIDAVIT OF NANCY
)ASHCRAFTINSUPPORTOF
)ORDER TO SHOW CAUSE
NANCY ASHCRAFT,being duly sworn,stated:
1.My name is Nancy Ashcraft.I am over 21 years of age,of sound mind,and I have
personal knowledge of the facts stated herein.
2.I am a Senior Financial Specialist at Idaho Public Utilities Commission.I started
working in this position in January 2016.I am responsible for the billing and collection of
annual fees as described in Idaho Code §§61-1001 through 61-1005.
3.Atlanta Power Company failed to file an annual verified return reporting its
annual intrastate gross operating revenue for calendar years 2017 and 2018,as described by
Idaho Code §61-1003.
4.In May and November 2017,Atlanta Power Company failed or refused to pay an
assumed regulatory fee of $50.The amount is assumed because pursuant to Idaho Code §61-
1004,$50 is the minimum assessment that may be charged to a utility.This amount was billed
because Commission staff was unable to calculate an accurate regulatory assessment amount due
the Company's failure to submit an annual verified return.
5.In May and November 2018,Atlanta Power Company failed or refused to pay an
assumed annual regulatory fee of $50.00.Again,the amount is assumed because pursuant to
Idaho Code §61-1004,$50 is the minimum assessment that may be charged to a utility.This
amount was billed because Commission staff was unable to calculate an accurate regulatory
assessment amount due the Company's failure to submit an annual verified return.
AFFIDAVIT OF NANCY ASHCRAFT 1
Exhibit 2
6.In February 2018,Atlanta Power was assessed $3.00 in interest on its outstanding
balance of $50 (6%).
7.Currently,Atlanta Power Company owes the Commission $103 in fees and
interest charges.
8.On multipleoccasions,Staff has attempted to obtain the Company's verified
returns and collect its past due annual fees by sending invoices,demand letters,and notification
that failure to comply would result in legal action.
Dated this day of November,2018.
By:Na y Ashcraft
Senior Financial Specialist
Idaho Public Utilities Commission
SUBSCRIBED AND SWORN to before me this day of November,2018.
A BC Notary Publiá for Idaho
STATE OF IDAHO My commission expires on Ú \10 6
AFFIDAVIT OF NANCY ASHCRAFT 2
¢uïTes
1913
STAFF REPORT
Case No.ATL-E-18-01
December 28,2018
ts Michael Eldred
Johnathan Farley
/'Brad Iverson-Long
Richard Keller
Kevin Keyt
Exhibit 3
BACKGROUND
On September 11,2000,the Commission received a petition from residents of Atlanta,
Idaho.The petition explained that Atlanta Power customers were concerned about issues
including:1)inconsistent service and power quality;2)extended outages and untimely response
times to system issues;3)poor communication between the Company and its customers;4)the
lack of qualified personnel to troubleshoot problems and make repairs;and 5)the lack of an
operational back-up generator.
In October of 2000,Staff felt it premature for the Commission to formallyinvestigate
Atlanta Power.Staff thus recommended an informal investigation.Staff proposed to perform a
financial audit,compile outage information,identify potential system improvements,and survey
customers to gauge their willingness to pay the higher rates associated with upgrading the
system.Staff s informal investigation lasted about two years.
On March 6,2003,Staff presented its findings to the Commission in a Decision
Memorandum.Staff reported it had worked with the Company and customers to identify and
address three problems areas:1)the lack of an onsite back-up generator;2)the lack of back-up
personnel;and 3)poor communications between the Company and its customers about outages.
Because of Staff's investigation,the Company hired Randy Nye,another Atlanta resident,to
back up the system operator,Dave Gill,and procured a telephone messaging system to notify
customers of planned outages and provide progress reports on system repairs.As a result of the
customer survey performed by Staff,purchasing and installing a back-up generator was not
recommended.Customers surveyed did not want to pay for the additional expense through rates.
On April 10,2003,the Commission opened Case No.ATL-E-03-01 and issued a Notice
of Proposed Order on April 10,2003.Summaries of Staff's report and copies of the Notice of
Proposed Order were sent to all customers.
On June 28,2003,Commission Staff conducted a public workshop in Atlanta,Idaho.
The Company's overdue annual reports were a major concern at the workshop.Without the
annual reports,customers were concerned that the Commission would not have the requisite
information to properly regulate and set rates for the Company.The Company agreed to prepare
and file all overdue annual reports.
On September 3,2003,Atlanta Power's president,Lynn Stevenson,was murdered.Israel
Ray was elected president by the principal shareholders.
1 ATTACHMENT A
In 2005,the Commission issued its final order and closed Case No.ATL-E-03-01.By
then,Mr.Ray had become the majority shareholder and president of Atlanta Power and had
improved the Company's operating procedures and physical plant in service.In the
Commission's final order,Order No.29706,the Commission found that the Company had made
several physical system improvements including:
1.A hole in the bladder that operates the spillway gates that control water flow to the
turbine has been repaired.
2.Four of the wicket gates that control water flow through the turbine have been repaired.
3.Broken or badly warped cross arms have been replaced.
4.A transformer support structure has been replaced.
5.One or more new transformers have been installed to better regulate system voltage.
6.The engine in the Company's old line truck has been replaced.
7.A new line truck has been purchased that can be operated by a single person from the
bucket.
8.The Company's inventory of poles and other supplies has been increased.
The Commission concluded Atlanta Power had improved the physical plant,system
reliability,regulatory accounting practices,and customer relations.The Commission attributed
the improvements to the change in ownership and Company management.In its closing
remarks,the Commission directed Staff to continue working informallywith the Company and
its customers to address customer concerns and work toward the continued betterment of electric
service in Atlanta.
In April of 2009,Allen Lake filed a complaint against Atlanta Power Company.Mr.
Lake asserted that he was receiving an inadequate power supply to run a dishwasher he had
installed as part of a home remodeling project.
On August 28,2009,two Idaho Power Company engineers analyzed power quality in
Atlanta.The engineers found that the system frequency varied +/-10 cycles per second (CPS)
from an ideal 60 CPS.As a solution,a tensioner was built to tighten the chain on the governor
that controlled the wicket gates in the turbine.By tightening the chain on the governor,Atlanta
Power planned to reduce the governor's response time to frequency changes and stabilize the
system frequency.Atlanta Power designed and installed the tensioner but the system frequency
problems persisted.Atlanta Power suggested conditioning the powerhouse in order to avoid
2 ATTACHMENT A
lubricants thickening in colder weather and offsetting the gains in response time that the
tensioner provided.
In November2009,Mr.Lake filed a formal complaint against Atlanta Power,and the
Commission opened Case No.ATL-E-09-01.In that case,Commission Staff identified two
solutions to address the system frequency issues Mr.Lake was experiencing.The first solution
was for Atlanta Power to buy and install a double conversion uninterruptible power supply
(UPC)in Mr.Lake's home.The UPC would convert Atlanta Power's AC power to DC and store
it in batteries,then convert the DC power back into AC at 60 cps using an inverter.Staff
believed that installing a UPC would eliminate Mr.Lake's problem for about $2,000 but would
only address the problem on a single circuit in Mr.Lake's home.Staff knew that other
customers served by Atlanta Power were experiencing the same frequency issues as Mr.Lake,
and identified a second solution that would address the whole system.
Staff s second solution was to replace Atlanta Power's turbine-generator control systems.
Staff asserted that a more accurate control system would stabilize the power line frequency by
detecting when the system frequency began to change and then quickly adjusting the wicket
gates.Staff concluded that upgrading the turbine-generator control system was the most cost-
effective solution to the power line frequency problem.However,Staff was concerned that the
$15,000 to $25,000 investment would increase rates,cause customers to leave the system,and
ultimatelyjeopardize Atlanta Power's financial viability.Staff thus recommended the Company
continue to pursue low-cost system improvements,and that StafTevaluate the Company's
financial position after November2011,when the Company had satisfied a $1,460-a-month loan.
On May 13,2010,the Commission issued Order No.31086 in Case No.ATL-E-09-01.
The Commission accepted Staff's recommendations for pursuing low-cost system improvements
and evaluatingthe Company's financial position after the Company satisfied its loan in
November 2011.The Commission ordered Commission Staff and Atlanta Power to "continue to
monitor the power quality concerns.If the power quality issues are not satisfactorily mitigated
by November 1,2011,then Staff and the Company will advise the Commission on an
appropriate course of action."
In November 2011,Staff evaluated the Company's financial position using the financial
records available at the end of the Company's loan term.Staff determined that rates did not need
3 ATTACHMENT A
to be reduced based on investments made by the Company.Staff continued to work with Atlanta
Power on an informal basis to address ongoing systems issues.
On January 2,2018,Mary Drake formallycomplained that the Company was violating
Commission Order No.31086 and Idaho Code §61-302 by not maintaining adequateservice.
See Attachment B.Ms.Drake addressed frequent power outages,public safety,lack of qualified
personnel to operate and maintain Company facilities,and the Company's inaccessibility and
failure to respond to customer complaints.
On February 20,2018,the Commission opened Case No.ATL-E-18-01.The
Commission ordered the Company to respond to Mary Drake's formal complaint,and Staff to
conduct a formal investigation.Staff's investigation focused on service reliability,maintenance
and operations,and customer service.See Order No.33988.
SERVICE RELIABILITY
The Distribution System
On March 14,2018,Atlanta Power customers reported a service line had detached from a
support and was on the ground.The customers were concerned the downed service line could
endanger people and animals that contacted it.
On March 29,2018,Commission Staff travelled to Atlanta to investigate the situation.
Staff saw the service line had fallen and was partially buried in snow,but the wire connections
were still intact.Staff surmised the low-hanging service line detached from a support pole when
a large amount of snow slid off a nearby roof and snagged the line.Due to weather and road
conditions,Staff could not investigate the entire distribution system.
On May 15,2018,Staff returned to Atlanta to continue its investigation.Staff found the
overhead distribution system consisted of poles,attachments,and transformers that exhibited a
range of conditions.Some equipment appeared to have been recently upgraded while some
equipment was derelict or broken.Staff noted several low-hanginglines and many poles that
were rotted at the base or leaning.Instead of replacing these poles,the Company used thru-bolts
or straps to join the old pole to a shorter anchor pole.
Staff also found transformers ranging in age and condition from near new to antiquated.
Some transformers showed signs of damage and possible leakage.Staff also identified
4 ATTACHMENT A
questionable Company practices,such as using pine trees as utility poles and service drops to
meters supported by a piece of wood above the customers'rooflines.
Power Generation
The Company has two sources of power generation,a run of river hydroelectric turbine
and a diesel electric back-up generator.The hydro plant has failed several times in recent years
and most recently in the spring of2017.Issues with the electronic load governor put the turbine
out of service for approximatelythree months.
On March 29,2018,when Staff inspected the dam site and powerhouse Staff was
informed that concerns remained about the electronic load governor.Several spillway gates that
control the flow of water into the reservoir were inoperable.The Atlanta Fire Chief,Gene
Haught,was concerned that the reservoir's water level would damage the electronic load
governor.He was also concerned that the reservoir water level could get too high and potentially
damage the dam.
During Staff's May 15 site inspection,Staff saw the fuel storage tank for the diesel
electric generator in the Company's equipment yard was on wooden blocks without secondary
containment.Staff noted that secondary containment would help mitigate fire hazards from
leaks and spills and prevent environmental contamination.Staff was also concerned with the
generator's exposure to the elements.Though the generator is enclosed,both doorways at
opposite ends of the building are open to the elements.
Service Outages
In December 2016,an outage occurred when equipment malfunctioned in the
powerhouse.The Company lacked adequate insulation for the equipment in the system control
room,and the equipment failed because of excessive cold.When the Company switched to
auxiliary power (a diesel generator),the generator ran out of fuel due to the reserve not being
filled completely.The Company has a reserve capacity of 1,500 gallons of diesel but the
Company's fuel supplier has a minimum delivery requirement of 3,000 gallons.
On March 12,2017,the hydroelectric turbine went down and the Company had to use the
diesel electric back-up generator to serve customers.The Company had attempted to service the
turbine but could not restart the system after completing the repairs.On March 27,2017,the
5 ATTACHMENTA
diesel electric generator ran out of fuel and service was out for all customers.The Company had
to borrow fuel from the local highway district and the local mine to operate the generator.
The generator ran out of fuel again on April 26,and the Company could not have fuel
delivered until May 2.Outages continued to plague the system throughoutthe year,culminating
in a 13-hour long outage on January 1,2018.
Safety Concerns
On March 29,2018,Staff identified a potential safety hazard posed by exposed drive
pulleys and belts on the turbine-generator.Although a makeshift railing separated building
access from the turbine-generator drive,Staff believes the barrier inadequately protects personnel
who enter the powerhouse.
Though the Company had repaired the downed service line reported to the Commission
in March 2018,Staff identified several other issues during its May 2018 inspection.Staff found
damaged transformers,leaning or rotted poles,low hanging lines,and questionable methods used
for routing and securing lines.In its May 2018 report to the Commission,Staff expressed
concern that the system may not satisfy the National Electric Safety Code,and that further
investigation may be warranted.
OPERATIONS &MAINTENANCE
Personnel
Currently,the Company has three employees,a bookkeeper (Linda Churches),a
maintenance person (Gene Haught),and a meter reader.The bookkeeper does not live in Atlanta
and works remotely.The maintenance person and meter reader live in Atlanta,Idaho.
Linda Churches produces and mails billings/notices,collects and deposits payments,and
reconciles customer usage with billing.Though she makes monthly cash deposits,she cannot
access the Company's financial records and she lacks check-writing authority.
The Company hired the Atlanta Fire Chief,Gene Haught,as the maintenance person in
May 2018.He performs general maintenance like greasing the turbine fittings,cleaning debris
from the spillway and syphon tube gates,etc.He can stop and reboot the turbine-generator and
program the electric governor,but he is not responsible for troubleshootingthe generation or
distribution systems,making repairs,or performing any duties comparable to those of a lineman
6 ATTACHMENT A
or electrician.Much like the bookkeeper,Mr.Haught lacks check-writing authority and account
access.He relies on the owner to provide the materials he needs to complete his daily functions.
The Company employs a meter reader whose sole function is to report each customer's
use to the bookkeeper on a monthlybasis.The Company has employed several people as the
meter reader in 2018.No matter who serves as the meter reader,the Company has required the
person filling that position live in Atlanta.
System Operator
The Company has not employed a system operator since December 2016.The system
operator troubleshoots the distribution and generation facilities,repairs and services equipment,
connects and disconnects services,and restores service outages.The previous system operator,
Dave Gill,was a longtime Atlanta resident who served in that position for over ten years.
In 2016,Dave Gill moved to Panama.The Company has struggled to hire a capable
replacement.Throughout 2017,the Company had several prolongedoutages and technical
mishaps that may have impacted customers less if the Company had a system operator.
In January 2018,customers reported to the Commission that Atlanta Power no longer had
a presence in Atlanta and customers were maintainingthe generation and distribution systems.
Accountingand Financial Records
The Company has several known financial accounting and financial issues,and its lack of
regulatory compliance prevents Staff from knowing if it has further issues.The Company has
not filed an Annual Report with the Commission since 2007,and has not filed other necessary
documents,including an Inventoryof Physical Properties and copies of maps and records in
compliance with Idaho Code §§61-402,61-404,and 61-605.Additionally,the Company has not
responded to all of the Production Requests issued by Commission Staff in ATL-E-18-01,has
not complied with past Commission orders,nor has it paid its annual Commission fees.
Staff has had only minimal access to any current financial information for the Company,
making it difficult to tell if the Company is financially viable.In response to a request from
Staff,the Company did report that it had 65 customers (57 residential,8 commercial)as of
April 2018.
7 ATTACHMENT A
Previously,employees,contractors and other persons,including customers,were
performing work for Atlanta Power but not getting paid for that work.Some customers who
performed work for the Company received credit on their electric bills in lieu of payment.
Recently,Staff was informed that all employees and contractors are getting paid for their work.
CUSTOMER SERVICE
Availability
In January 2018,Staff received reports that the Company was becoming increasingly
hard to contact.Previously,all calls for service were routed to the owner,Israel Ray.If
customers questioned billings and notices,they would contact the bookkeeper.Customers could
call the owner and bookkeeper directly or they could call a l-800 number that would route calls
to the owner.
Staff found the Company's 1-800 number was disconnected,and the owner was no
longer answering calls or returning messages from Staff or customers.
In March 2018,Israel Ray's brother,Ronald Ray,explained to Staff that his brother had a
medical condition that made it difficult for Israel to make rational decisions.Ronald Ray
claimed Israel needed continuous care,and that he would be travelling with Ronald to Alaska.
Staff has had no direct contact with Israel Ray since June 2017,and believes he still resides in
Alaska.
Responsiveness and Dispute Resolution
On February 20,2018,the Commission ordered the Company to respond to Mary
Drake's formal complaint.See Order No.33988,Case No.ATL-E-18-01.The Company has
not responded to the complaint as of December 18,2018.Additionally,the Commission has
issued four summons,and Staff has served two production requests since the case was opened.
All have gone unanswered.
Staff has tried to coñtact Israel Ray but has only reached his brother,Ronald Ray.As
noted above,on several occasions,Ronald has stated that Israel cannot make rational decisions,
and Ronald is uncertain if or when Israel will be able to do so.Staff has asked Ronald if he
would pursue a power of attorney for Israel.Ronald unequivocally replied that he would not and
is unwilling to take control of Atlanta Power.
8 ATTACHMENT A
SUMMARY
The lack of response to Staff's requests for information (both formal and informal)has
impeded Staff's investigation in this case.Another major impediment to investigating and
attempting to resolve this case is that Israel Ray,the only person authorized to do business on
behalf of Atlanta Power,has been unavailable,and is apparently unable to perform his duties.
While it appears that some issues,such as hiring or contracting with people to maintain,
operate,and,if necessary,repair the system have been addressed,Staff remains concerned about
a number of issues,including how the system is being maintained,the condition of lines,poles
and other equipment,maintaining an adequate supply of diesel fuel for the back-up generator as
well as unresolved safety issues.With the arrival of winter,Staff is concerned that service
reliability will continue to be an issue.
STAFF RECOMMENDATION
Due to the Company's failure to respond to Staff's Production Requests and the uncertain
status of Israel Ray,Staff recommends that,as a next step,an Order to Show Cause be issued to
compel compliance with the Commission's Orders as well as statutory and regulatory
requirements.
9 ATTACHMENT A
Idaho Public Utilities Commission
Office of the SecretaryRECEIVED
JAN 0 2 2018
From:ÍhdidIldggmaic9111[g3ailto:flute.mdhya j orn]
Sent:Tuesday,January 2,2018 1:47 PM
To:Front <frontgguc.idaho ov>;Beverly Barker <QgveßYEMiff pic bo gpy>
Subject:Consumer Assistance Form:Mary Drake
Name:Mary Drake
Email:flutimdþgmajLcyn
Telephone:[phone]
Address:72 E PINE ST
ATLANTAID,83716
Name of Utility Company:Atlanta PoWer Company contacted Utility:Yes
Complaint:Mary E.Drake
72 E.Pine
Atlanta,Idaho 83716
Idaho Public Utilities Commission
472 W.Washington
Boise,Idaho 83702
Dear Commissioners:
Please consider this a formal complaint against Atlanta Power Company for failing to fulfill their lawful
duty of providingand maintaining adequate services of electricity to the town of Atlanta,idaho,per
Idaho Statute 61-301.The Statute reads:"DUTIES OF PUBLIC UTILITIES61-302.MAINTENANCE OF
ADEO.UATESERVICE.Every public utility shall furnish,provide and maintain such service,
instrumentalities,equipment and facilities as shall promote the safety,health,comfort and convenience
of its patrons,employees and the public,and as shall be in all respects adequate,efficient,just and
reasonable."
I have been a resident of Atlanta,Idaho for 20 years.I have experienced the change of ownership of the
Atlanta Power Company,I am also aware of previous complaints about the services provided by the
company,and the ensuing Final Order of May 13,2010.There is plenty of historical evidence that shows
there has been a problem with Atlanta Power Company outages for many years.
This complaint,today,is to inform you that Atlanta Power Company is NOT DOING WHAT they agreed to
do per the Final Order dated May 13,2010 (Order #31086)in which it states:"It is further ordered that
Atlanta Power Company continue to monitor the power concerns.If the power concerns are not
mitigated,then the staff and company will advise the commission on appropriate course of action."It
has been 7 years since this order,and the power outages still occur.Many people have complained to
the PUC,yet no action is taken.This complaint poses the question:Why is the Atlanta Power Company
not being held accountable to uphold its duties as a utility providerby the PUC?Please,we need help!
Also,after an investigation into Atlanta Power Company by PUC in February,2005,Order #29706,it
states that "It appears Dave Gill's availability has changed.He is available in Atlanta for immediate
system repairs most of the time."This is NO LONGERTRUE.Dave Gill no longer lives in Atlanta,Idaho.
Hence,this formal complaint,filed here,now is:
ATTACHMENT B
1.There continues to be frequentpower outages in Atlanta,Idaho.
2.Power outages HARM the safety of Atlanta residents,due to needing access to electronics for
emergencies,drinking water (for those with electronic water pumps),and access to healthy food
(refrigeratorsgo out and food spoils during outages).
3.There is no one in town who knows how to fix the system when the owner of Atlanta Power
Company (Israel Ray)is out of town.
4.Israel Ray does not hire anybody to be available to diagnose problems and fix problems during
outages.
5.Although there is a generator up here,in Atlanta,it does not function in cold weather,due to diesel
fuel.
6.Israel Ray,as owner of Atlanta Power Company is not fulfilling his lawful duty as a utility company per
statute 61-302 which states:DUTIES OF PUBLIC UTILITIES:61-302.MAINTENANCE OF ADEQUATE
SERVICE.Every public utility shall furnish,provide and maintain such service,instrumentalities,
equipmentand facilities as shall promote the safety,health,comfort and convenience of its patrons,
employees and the public,and as shall be in all respects adequate,efficient,just and reasonable."
Evidence that demonstrates Failure to comply with this statute includes,but not limited to:
a.There is no telephone number to call for assistance when the power goes out in Atlanta,Idaho.The
number to call is Israel's,and the message inbox is ALWAYS FULL.No other number to call,or way to
contact him or anybody who knows how to help during a power outage.This is blatant disregard for us,
consumers,customers,residents of Atlanta,who pay our bills to Atlanta Power Company every month
for services we EXPECTto receive in exchange!
b.Israel Ray leaves town and nobody has any way to contact him.He leaves town and is nowhere to be
found during a power outage,nor has he trained anybody to help during his absence.This is simply
irresponsible,and a blatant disregard for Statute 61-302.
7.After many,many years of problems with the power in Atlanta,Idaho,there seems to be no
resolution.If something gets fixed,it's momentary.Granted,there is a generator up here now,but it
doesn't start in the winter,and in the summer,it runs out of gas and we need to wait days before we
get diesel gas up here.Therefore,the Time is NOW to fix the problem!!When will this be resolved??
Please,please give attention to this formal complaint.The situation in Atlanta needs ATTENTION now!
Israel Ray and The Atlanta Power Company need to be held accountable for their LACK of ACTIONS in
adhering to the law for public utilities.For,l,myself am a paying customer,as are many others in this
town and we simply WANT TO NOT HAVE TO DEAL WITH THE CONSTANT POWER OUTAGES and TOTAL
LACK OF CUSTOMER CONSIDERATION,and the lack of ACCOUNTABILITY demonstrated by Israel Ray and
the Atlanta Power Company.
Thank you for your action in this matter.
Sincerely,
s/Mary E.Drake
Mary E.Drake
Unique Identifier:216.182.111.139
ATTACHMENTB
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 28-re DAY OF DECEMBER 2018,
SERVED THE FOREGOING STAFF REPORT OF THE COMMISSION STAFF,IN
CASE NO.ATL-E-18-01,BY E-MAILING AND MAILING A COPY THEREOF,
POSTAGE PREPAID,TO THE FOLLOWING:
ISRAEL RAY STEVEN J MEADE
ATLANTA POWER COMPANY ATLANTA WATER ASSOC INC
ll 140 CHICKEN DINNER RD PO BOX 1097
CALDWELL ID 83607 BOISE ID 83701
E-MAIL:[e-mail]
ELECTRONIC SERVICE ONLY STEVEN J MEADE
ATLANTA WATER ASSOC INC ATLANTA LANDOWNER'S ASSOC
theamvobrien email.com PO BOX 1097
dvance.awademail.com BOISE ID 83701
rickandevyienkins email.com E-MAIL:[e-mail]
indeb rtei.net
ELECTRONIC SERVICE ONLY ELECTRONIC SERVICE ONLY
ATLANTA LANDOWNER'S ASSOC ATLANTA LAND OWNER
[e-mail] steve pumpkincreekranch.com
andy [e-mail]
matt boiseinfill.com
juilles cableone.net
SECRETARY
CERTIFICATE OF SERVICE