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HomeMy WebLinkAbout19920601.docx MINUTES OF DECISION MEETING June 1, 1992 - 1:30 p.m. In attendance were:  Commissioners Marsha H. Smith, Joe Miller and Ralph Nelson; and staff members Mike Gilmore, Scott Woodbury, Belinda Anderson, Jim Long, Beverly Barker, Randy Lobb, Eileen Benner, Birdelle Brown, Mary Friddle, Bill Eastlake, Allan Killian, Don Howell, Stephanie Miller, Gary Richardson and Myrna Walters.  Also in attendance was Walt Sorg of GTE; Mike McGarth and Skip Worthan of IGC and Woody Richards, Attorney at Law. Items from the June 1, 1992 Agenda were discussed as follows: 1.  Regulated Carrier Division Agenda dated June 1, 1992. Approved. 2.  Don Howell's May 27, 1992 Decision Memorandum re:  Union Pacific's Application to Close the Weiser/Payette and Moscow Freight Agencies, Case No. UP-RR-92-2. Commissioner Nelson said since we have recently been to Weiser, perhaps we could do this on modified procedure. Commissioner Miller asked Don Howell what he had in mind in asking Washington? Don Howell said some of the shippers served in Moscow have Washington agents.  When Moscow had their agency case in '85, one of their shippers in Pullman was served by Moscow.  Was not suggesting a hearing, but do want to give them informal notice, at least.  Washington shippers are probably served by Moscow.  Asked if there was any feeling about Moscow?  No to Weiser? Said he has asked the railroad for names and address of shippers for these agencies.  In the last case in Moscow,  did have Washington shippers come in.  One was WSU.  Suggested - could do it on modified and see if there is a request for hearing. Commissioner Smith asked - why do you think they both should be in one case? Don Howell said they came in that way.  Can break them out. Commissioner Smith asked if there were any agencies open in Washington? -2- Commissioner Miller said his only reservation about modified procedure is that it carries the connotation that the Commission is going to grant the relief... it can scare people off.  With Weiser it wouldn't bother him as much.  Being an unknown in Moscow, was a little less comfortable with that. Commissioner Smith suggested doing a notice of application first to see if anyone will come. Commissioner Miller said we could do a notice of investigation and invite comments and request for hearing but not make the finding of hearing being necessary. **Tonya Clark was in attendance at this time. Commissioner Nelson asked - both of them? Commissioner Smith said it didn't bother her to do modified procedure in Weiser. Don Howell spoke to the Nampa and Aberdeen agencies. Decision was:  Split the cases; modified on Weiser; notice of application for Moscow. Commissioner Smith said to not formally invite Washington.  But do send notice to the shippers. 3.  Jim Long's May 27, 1992 Decision Memorandum re:  GTE Advice 92-5  Reduction in D.I.D. and Centranet Feature Package Rates.  This advice also introduces Feature Rearrangement and Textual Changes in Feature Descriptions. Commissioner Miller asked - do I understand that the University has agreed to this? Jim Long said yes.  They are not really happy about paying from October 4, though.  This back-billing is permitted by our consumer rules. Commissioner Nelson asked - is it your feeling it covers costs (the new agreement)? Jim Long said it more than covers the cost and keeps it revenue neutral from the last rate case.  Spoke to the 4000 D.I.D.s at University of Idaho. Don Howell explained that.  D.I.D. contract ran out.  It went to a tariffed rate. **Okayed the D.I.D. -3- Discussed Centranet. Commissioner Miller said he was pleased to see there was a reasonable effort to verify costs.  It didn't appear it is being priced anti-competitively.  Was curious to know why people who want to take this service have to have the means?  Is it a technical requirement or business requirement? Jim Long said business as far as he can see. Commissioner Miller said U. S. West went through this problem of a price discrimination of Centrex.  Is there anything like that here? Jim Long said this appears to be a little different.  Explained what U. S. West is doing in the north and the south.  U. S. West did increase their feature costs because of MFJ.  In talking with U. S. West about this case, they seem to think that the way they are serving these features, they are doing it with circuit pack.  Thought cost would be less than their Centron. Commissioner Smith asked about the $447?  Is it revenue reduction? Jim Long said yes. Commissioner Miller asked - is this pricing model so imprecise that it can't price between 30% to over 80,000? Jim Long explained the percentages. After discussion, was approved. 4.  Scott Woodbury and Madonna Faunce's May 28, 1992 Decision Memorandum re:  INT-G-92-2. Commissioner Miller said given the fact that we are going to have a meeting Thursday and in light of the letter form the Company, wouldn't mind deferring this until Thursday.  By then we will know if we will have a problem or not. Commissioner Smith asked - can it be worked out by Thursday? Scott Woodbury said he thought the logic was sound.  Would certainly like a go at it. Commissioner Smith said the question is going to be the same Thursday as today. -4- **It was noted that Skip Worthan would be out of town on Thursday. Commissioner Miller said he got the impression that after getting the decision memo on Friday there were other problems. Madonna Faunce said the first issue was such a small amount for this past year, but was looking at it on a going forward basis.  Was just pointing it out going forward. Scott Woodbury said if the Company feels they haven't gotten input, staff will be happy to talk to them.  Don't know that this is the place for this. Commissioner Smith said the other option would be to put it out on modified procedure.  There has not been any public notice.  Then could take it up on the 15th.  That is the other choice. Scott Woodbury said FMC has petitioned to intervene. Commissioner Miller asked about the FMC intervention?  Wouldn't mind waiting until Thursday and take it up then.  Have some questions before we put it out. Commissioner Smith asked - is it your expectation to put it out on modified after that?  If they want it by July, will run out of time.  Could put modified out in the meantime. Commissioner Miller said it looked like in reviewing Exhibits 4 and 5, with respect to understanding how it all works through, was curious to know from staff, which of the eleven adjustments on four and 5 have been audited and verified and which have not.  That is his first question.  Decision Memo has indicated limited auditing.  Would like to know that. Said as he looked at it, we are taking away surcharge of 1615¢ and adding almost equivalent, slightly greater amounts.  Those amounts appear to be on Exhibit 5.  General question was:  curious to know the extent to which our methodology allows the company to in effect pick and choose items to be included in the surcharge or is there no discretion?  Wonder if it is coincidence that the amounts are almost the same.  Have forgotten how that methodology works.  Was curious about the two accounts within the new surcharge, 186 variables and NW direct bill.  Those appear to be the two that constitute the bulk of the surcharge.  Looks like this 186 variable shifts to ratepayers the risk of warm winter, curious to know if it falls the other -5- way, when its colder, do the ratepayers get the benefit the following year?   Wonder what the NW direct bill is?  Has that been verified?  Then, curious to know if Jackson Prairie therm adjustment has been audited and verified and was curious to know if the change from sales transportation contract demand is appropriately included in the tracker before it is approved by FERC and if it is, where that adjustment appears on 4 and 5.  Finally, was curious to know where on those exhibits you would find the pass-through of Northwest Pipeline settlement agreement.  That is what he was curious to know about. Madonna Faunce responded.  Said the fact that the two amounts are almost identical is circumstantial.  They take everything that affects the purchase of gas and transportation and that goes into the prior tracker.  We set up perimeters, we approve such as what transportation charge is going to be, approve the purchase gas cost.  Anything that is different from what we approve is shown and goes between the 186 Account and cost of gas that is expensed.  She has audited the 186 Account and everything goes into the 186 that makes up those numbers.  Did not go back and check on the expenses because they are not affected by this.  Only checked the cost of gas and whether there should have been any others included or excluded from this tracker.  Have audited that very thoroughly.  The Exhibit 5, Line 16, the 186 variable, that is the settlement agreement on SSP.  Was originally $650,000.  Referred to that on Exhibit 5, Page 3, Line 12.  $528,066 is the settlement.  It was originally $650,000 because certain LBT customers were getting a piece of this.  That was direct billed.  We did audit that split out to be sure the split was correct between different customers.  Exhibit 5, Page 12, is the number. Said if you refer back to Exhibit 3, Page 17, that is the FERC approval of that settlement, through Page 20 of Exhibit 3.  In her workpapers, it shows how they arrived at their numbers.  It shows the split.  Did check that out. Commissioner Miller asked - what is the dollar amount of SSP to be recovered through this mechanism in the next year? Madonna Faunce replied- there is a portion in the transportation charge that is approved by FERC but only portion we have a direct billed is $650,000 and amount the core customers will pay of $528,000.   That is all that is left out and the direct bill SSP charges. Commissioner Miller asked if that finds its way to Exhibit 4? -6- Madonna Faunce said to look at Line 22, Temporary Surcharge proposed, for RSl it is 01669.  If you go to Exhibit 5 and look at RS1, that is your .01669. Commissioner Miller asked - so SSP payments are on Line 16? Madonna Faunce said yes.  There is a refund on the commodity charge of SSP.  That is the portion that is associated with the transportation.  FERC had a problem with how they were charging for therms.  They had to refund a small portion.  So if you look at Lines 15 and 16, you are looking at two different sides. Skip Worthan said - the variable piece has amortization of approximately 5 years.  Went to pipeline rate in '89 or '90.  The part adjusted is this 5 year amortization.  As a result of the new therms, on that amortization, as result of finding a base rate...that adjustment is for the terms collected; under the old method versus new method.  That is the refund piece. Said the $650,000 is related to a PGA direct billing for Northwest Pipeline for 1988 as a result of open access, when you had all the customers departing sales for transportation, the methodology did not work in the future 12 month period.  You had an initial piece paid for (approximately 10% of $28,000,000.)  Subsequently one of the participants in that particular direct billing case, challenged the case, Northwest Natural, the court essentially said try to figure out a settlement.  This settlement was a result of that.  Methods available in the settlement would not have favored IGC as much as this $560,000.  This number was the least of methodologies approved, had it gone to FERC. Commissioner Miller said Jackson Prairie therm adjustment - asked Madonna Faunce if she was satisfied? Madonna Faunce said she was. Commissioner Miller asked about the applied for but not approved amount?   Scott Woodbury said the approval by FERC will not be found.  It is a reduction as shown in the workpapers.  Anticipated this occurring this August between now and first of October.  So we chose since it was a downward adjustment, to flow it through now.  For now to next July.  See nothing other than FERC's lack of movement that will change that from going through. -7- Madonna Faunce said she was comfortable with it because all she has read about it approves that. Commissioner Miller said since this is only done once a year, think it is important to do this.  Only remaining concern he had is the prior settlement part.  Didn't know how he felt about that. Commissioner Smith asked - want to do modified now?  Should we invite comments on these issues? Commissioner Miller said he thought we should lay out what the questions are before us now. Commissioner Smith suggested putting it out on notice of application and ask for comments by the 15th. Agreed. In attendance at this time were:  Dave Hattaway, Dave Schunke, Keith Hessing and Eileen Benner. 5.  Lynn Anderson's May 29, 1992 Decision Memorandum re:  Clark Fork EAS Petition. Discussed the matter. Decision was to open an investigation. 6.  Keith Hessing's May 29, 1992 Decision Memorandum re:  Monsanto-UPL Contract Rates. Commissioner Nelson said he thought it should be approved. Commissioner Miller asked if Monsanto had reviewed it? Keith Hessing said he didn't know if they have looked at the calculation but they know its necessary. Okayed. Keith Hessing said they asked for effective date of May 6, the date of the Idaho Power rate change. Mike Gilmore explained that was pretty standard.  It takes UP&L awhile to catch up. Okayed the May 6 date also. -8- 7.  Terri Carlock's May 29, 1992 Decision Memorandum re:  Citizens Utilities Company-1992 Stock Split-Case No. CUC-S-92-1. Approved. 8.  Terri Carlock's May 29, 1992 Decision Memorandum re:  Pacificorp's Request for $500,000,000; Case No. PAC-S-92-1. Matter was discussed briefly. Commissioner Nelson asked if this was all new debt? Terri Carlock responded - said it was.  But they do have others outstanding. Commissioner Nelson said it looked like we moved to the accepted debt ratio from a higher equity position. Approved.         DATED at Boise, Idaho this       day of September, 1992.                           PRESIDENT                           COMMISSIONER                           COMMISSIONER ATTEST:                               Commission Secretary 0114M