19931222.docx

MINUTES OF DECISION MEETING
DECEMBER 22, 1993 - 1:30 p.m.
In attendance were Commissioners Marsha H. Smith, Joe Miller and Ralph Nelson and staff members Don Howell, Weldon Stutzman, Terri Carlock, Gary Richardson, Triva Pline, Stephanie Miller, Mary Friddle and Myrna Walters.
Also in attendance were Barney Hardin and Tim Stivers and a representative of Idaho Power Company.
Items from the 12-22-93 Decision Meeting Agenda were discussed and acted upon as follows.
1.  Don Howell's December 6, 1993 Decision Memorandum re:  Train Speeds in Shoshone, Case No. UP-RR-93-2.  (Held from 12-6-93 Decision Meeting).
Don Howell asked if commissioners wanted to rule on the petition or have a hearing on whether there is some safety hazard requiring some action.
Commissioner Nelson said Commission could rule on whether or Commission has jurisdiction but don't know how a new standard can be set without first having a hearing.
Commissioner Smith said there were two choices.
Commissioner Nelson said he would go with the factual hearing.
Commissioner Miller said the question he had is what would be the nature of the proof to establish a local safety hazard?  Would have to have expert testimony to establish that this is a hazard or the hazard is operating at high speed in this one locality.  Seems like we need some expert testimony to establish that it is a safety hazard.  Would need something other than the Mayor coming in saying that the train is going fast.
Commissioner Nelson said - would need some statistics, etc.
Commissioner Miller said putting that aside and assuming we can get the proper proof, guess at least for now was willing to accept the arguments that this does constitute a safety hazard but think quality of the proof will have to be pretty good in order for us to distinguish this from every other town where it exists.
Commissioner Nelson said this is the only town we have a complaint from but it certainly needs some evidence that a safety hazard exists and not just because the train goes through town.
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Commissioner Miller said public sentiment is not the issue.
**Will have hearing - stress the burden of proof.
2.  Don Howell's December 7, 1993 Decision Memorandum re:  Tow Truck Insurance Comments, Case No. GNR-M-93-1.
Approved.
3.  Regulated Carrier Division Agenda dated December 20, 1993.
Okayed.
4.  Mary Friddle's December 20, 1993 Decision Memorandum re:  McDaniel Trucking, Inc.
Commissioner Smith said if she understood this correctly, there is no dispute over the issuance of general commodities.
Mary Friddle said that was correct.  
Commissioner Smith asked - there is no dispute over the denial of houses, buildings and structures?
Mary Friddle asked - by the staff and Mr. Stivers?
Tim Stivers said he didn't think this is the transaction the Commission should be dealing with.  Is a straight transfer.  No difference in the common control except for the July ruling.  Trying to transfer what they had before the new company.
Commissioner Smith said - need to restate the authority in the descriptive wording.
Tim Stivers said he would like everything they had to be covered in the new.
Mary Friddle explained staff's concerns.
Commissioner Smith said the next step would be a hearing.
Mary Friddle said staff still feels tow truck, etc. shouldn't be granted.  Don't think they are fit, willing and able to do that.
Commissioner Miller said - trying to use decision meetings to resolve matters of dispute is an unsatisfactory way of doing business from everybody's prospective.  Doing this in a hearing context - it could be done in an hour or so.
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Commissioner Smith asked - in the meantime, what is the status?  Operate with old authority?
Mary Friddle suggested they could have the undisputed commodity.
Commissioner Smith said we have to have a rational process to resolve these questions.  Because they are ongoing, the discussions are not being conclusive.  It seems that it is time for the Commissioners to give the answers.  We need a record for that.
Tim Stivers said he didn't have sufficient time in this matter.  Has a problem.  May just withdraw this one and do it the other way.  Don't know what the authority groupings are yet.
Commissioner Nelson suggested holding it.
Commissioner Smith said - grant general commodities authority and parcels and then hold open the option of additional filings to prove more need.  Would like for these folks to have what they need to be in business now.
Tim Stivers said this company - what he is going today is not what he was doing last year and may not be what he needs later.
Commissioner Miller said - grant the undisputed parts and set the rest for hearing.  If it gets withdrawn, it gets withdrawn, don't want to impose unnecessary costs or restrict authorities, but agree that trying to wrestle these in this format, cannot be done.
**Went with Commissioner Miller's recommendation.
5.  Mary Friddle's December 20, 1993 Decision Memorandum re:  Concrete Placing Company, Inc. (CPC)
Commissioner Smith said - here we have a recommendation to grant general commodities, houses and express parcel transportation.
Tim Stivers said - think he has proven wood residuals on back haul.
Mary Friddle said staff still doesn't agree wood residuals should be granted.  
Commissioner Nelson said he would move to grant authority for those three items.
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Commissioner Smith asked what the objections are based on?
Mary Friddle responded.  Not sure if they have the right equipment for that.  Applicant did not want it.
Tim Stivers responded.
Commissioner Smith asked about wood residuals?
Commissioner Miller said - have hearing.  Can't make decisions on disputed matters based on conversations, etc.  Hate to put people through unnecessary hearings.
Commissioner Nelson said Mr. Stivers did bring up the question of who staff should deal with.  If Mr. Stivers files the application, don't think staff should be talking to a secretary.  Have a procedural problem.  Don't expect our attorneys to call staff at the utilities.
Commissioner Smith said these carriers don't have attorneys.  Should be talked to people who own and control the company.
Commissioner Nelson said at some point will have to answer the question.  Said there is a motion to grant some authority they had on temporary.
Commissioner Miller said - then have hearing on wood residuals (contested matter).
Tim Stivers said depending on the description staff comes up with.
6.  Mary Friddle's December 20, 1993 Decision Memorandum re:  Application for A. R. Montague.
Nothing is disputed.
Barney Hardin said he did have a question.  On mobile homes, not sure what the final definition includes and don't want mobile homes to be restricted to 14 ft.  Some are wider than that.  His client wants to haul any kind of mobile homes.
Mary Friddle said the description will be 16 feet.  Explained why.
Barney Hardin said that is why the original application was for houses.  Doesn't have equipment for that.  Is afraid of too narrow a definition on what a mobile home is.
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Commissioner Smith asked Mary Friddle what the timeframe was on 14/16?  Asked staff to talk to Mr. Hardin about the description.
Mr. Hardin suggested saying - moved in sections.  Don't like the width restriction.  Don't want the client to have to come in next year.
Commissioner Smith said to get together with Mr. Hardin and get this straightened out.
Approved Montague.
7.  Mary Friddle's December 20, 1993 Decision Memorandum re:  Cascade Lake Excursion, Inc. dba Long Valley Bus Company.
Commissioner Smith read what was uncontested authority and what contested issues are.  Contested are:  passengers in charter service by limo and Class D tow truck authority.
Tim Stivers asked if Class D was still contested?
Don Howell said staff has met with Mr. Stivers in an effort to flesh out the categories.  Wasn't sure if the problems had been fixed on tow trucks.  Have an on-going rulemaking on tow truck rules.  One answer is it is still contested but it is the staff view that tow truck rules were initial moves, not secondary moves, kinds of authorities Mr. Stivers' client needs.  Explained what problem was with Cascade Lake Excursion.  Are getting close on the description, but aren't 100%.
Commissioner Smith asked - if we grant a certificate and include Class D tow truck, no one would no what that is because we don't have rules?
Don Howell said we have a set of proposed rules - they could be changed.  Have set a public hearing on the rules.  Class D tow truck is one of five kinds of tow trucks.
Commissioner Smith asked - is there any way to give this applicant the authority he seeks, do what he wants to do?
Don Howell said in his opinion there is.  Under Category 10, Commission does have the discretion to set a tailor-made permit for towing of cars with this kind of equipment, Commission has the discretion to do that.
Commissioner Smith said it made sense to her.
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Commissioner Nelson asked if this was car hauling versus car towing?
Don Howell explained.  Said the difference is the secondary moves, a secondary has the luxury of getting different prices.  When you are on the side of the road, you haven't many choices.
Commissioner Smith asked - can we give this person a certificate now without making him wait for tow truck rules?
Commissioner Miller said his point all along has been to grant authority requested - haven't wanted to guess wrong.
Commissioner Smith said that still leaves one area unresolved.
Mary Friddle spoke to staff problem.  The application says they "may" do this service (limo).
**Agreed to specialized language on tow trucks (what he needs to haul cars).
Commissioner Nelson asked about the definition of limi- is it an ICC definition?
Mary Friddle said it is a staff interpretation.
Commissioner Nelson asked - is this definition a proposed definition or is it in place for prior authority?
Mary Friddle said this definition is in place now.
Tim Stivers said his definition is not what is in effect now.  It is the definition promulgated on the 25th.
Explained it.  He may or may not get the equipment.  Said he was comfortable with Don Howell's definition.
Commissioner Smith said it does seem that the intent is to provide limo.
Commissioner Nelson said he moved his definition, plus car hauling.
**Taken care of.
8.  Application for temporary authority of S.M.X.
Commissioner Nelson asked about the form?
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Commissioner Miller asked if there were protests?
Mary Friddle repeated what staff's concern was.
Commissioner Nelson said in the past we said if they had a letter saying there is a need, we granted it.  We don't have any statements that these other people were willing to provide the service.  It is just secondhand conversation.  Think the rules have changed here.
Commissioner Miller said he had a little discomfort with this one also.  Is reluctant to deny authority with relative vague circumstances.
**Bev Barker, Joe Cusick and Lynn Anderson were in attendance at this time.
Commissioner Miller said it was hard to know with certainty what the person was really thinking when he put in the answer here.  When the information comes to the Commission in a secondhand form it is hard to act on it with comfort.  Wonder if a better way would be to grant the temporary and see if they do protest.
Okayed.
9.  Belinda Anderson's December 1, 1993 Decision Memorandum re:  U S West's Filing to Offer Stand-by Line Service to Business PBX Trunks and Business NARS (Network Access Registers).
Approved.
10. Randy Lobb's December 9, 1993 Decision Memorandum re:  Approval of the Public Drinking Water Fee Tariff for Warm Springs Mesa Water Company.
Approved.
11. Submission of 1994 TRS budget for approval - Bob Dunbar's 12-6-93 Proposal.
Commissioner Smith said it should be noted for the minutes that the Commission has reviewed the Idaho TRS Fund Budget submitted by the Administrator and has okayed it.  Original will be placed with the Contract on file.
12. Beverly Barker's December 10, 1993 Decision Memorandum re:  Utah Power & Light Tariff Advice on Deposit Interest.
Approved.
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13. Joe Cusick's December 15, 1993 Decision Memorandum re:  GTE Advice No. 93-22.  Add Kellogg and Wallace Exchanges to GTE's Basic Calling Service Plan.
GTE has digital switch in Wallace.
Approved tariff advice.
14. Weldon Stutzman's December 17, 1993 Decision Memorandum re:  Case No. EAG-W-93-3, Eagle Water Company, Inc.'s Request for Expansion of Certificated Area.
Approved.
15.  Weldon Stutzman's December 20, 1993 Decision Memorandum re:  Firm Energy Sales Agreement - Idaho Power and Contractors Power Group, Inc., IPC-E-93-25.
Withdrawn at request of Idaho Power Company.
16. Brad Purdy's December 1, 1993 Decision Memorandum re:  Case No. IPC-E-93-24, Idaho Power's Application for Authority to Offset the Gain from the Sale of the Hailey Turbine against the Revenue Requirement Increase Caused by Changes in Federal Tax Rates (Held from the 12-8-93 Decision Meeting).
Commissioner Smith said the application of the company wanted to offset the gain from the sale against the 1993 increase in federal income taxes.  Staff agreed to defer accounting which is a departure from usual, but felt that no offset should be allowed prior to the date of the final order on this request, somehow believing that it is retroactive ratemaking.  Have struggled to understand this.  Has come down to four points.
(1)  Agree with staff on the opposition to the one item cases and is opposed to one item cases also.  But also recognize that we have a history of making these decisions.
Then go to the question of whether it is retroactive.  Read 67-502 - in this case we have no change in rates.  In fact staff acknowledges that it is not looking at earnings.  (2)  It seems to her that it is just like the 1985 tax change case.  There was a tax decrease and allowed offset by increase.  Here we have a tax increase which the company requested it be matched by retail revenue in 1993.  To her this just looks like accounting and what the company wanted to do is match 1993 expenses with 1993 revenues, putting it in deferred.  Don't think it is optional.  It will affect rates when we have a rate case.
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Then even if you thought there was a retroactive problem, get to the question of when are taxes due and payable.  They can pay them in March without penalty.  We are well ahead of when this had to be made.  You go back and change these accounts for each month to match up.  Doesn't consider her taxes due until midnight April 15.  If company doesn't have to pay until March, we are ahead of that.
If you still think it is retro, you have all those cases, saying extraordinary are outside retroactive ratemaking.
Commissioner Miller said that is well stated, but its wrong.
On the extraordinary point are the cases Larry Ripley provided.  Think arguably they are all cases that dealt with circumstances more in the nature of acts of God, events that are completely outside the course of normal experience and that tax changes occur all the time.  Not sure the extraordinary expenses to the rule applies.  That is the easiest of the points to dispose of.  Most of those dealt with 100 year storms.  Dealing with easy course first so that didn't bother him.  Said question he didn't know the answer to is whether the rule only applies when there is an immediate change in rates as a result of our decision.  Is the rule against retroactive rulemaking aimed at immediate change in retail rates or is it for accounting changes that once set in motion have potential for changing rates or would change rates in the future because of the deferral?
None of the cases we have seen so far really address that question.  So we don't have any legal precedent to answer that question.  Seemed to him from policy pont you could make argument that it is not necessarily aimed at decisions that have an immediate effect on retail rates because the accumulation of charges and with their eventual pass-thru in rates, transfer from one time period to another time period, is essentially the value that retroactive ratemaking is to guard against.  From a policy point of view, it didn't seem to him that it necessarily hinges on whether or not there is an immediate change in rates.  On the due and payable point, not sure what the right answer is.  More essentially for ratemaking purposes, we view taxes as being the liability accuing through the year, we don't make it dependent upon when you actually have to write the check.  Think that is how we generally view taxes for ratemaking purposes.  So for him, it is not uncomfortable to view the liability as accuing more and more as opposed to looking at the time when you write the check.
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Commissioner Smith said if you have a policy that the law doesn't make a rate change(don't know if it does) agreed with the Florida Commission.  All the cases deal with actual rate changes but if you have a policy that you are not going to transfer money from one time period to another, you would not place this money in a deferred account in the beginning.  You would file a complaint against the company.  Deferred accounting is so you don't have fluctuations in rates continuously.  In the meantime you are accruing expenses and income to be settled out later.  So, think the statute was aimed at rate change "after a hearing".  Spoke to the Florida case.
Commissioner Nelson said he thought that was an excellent discussion and thought you could go either way.  Like Commissioner Miller's analysis and does agree with his conclusion.
Because he thought you could go either way and because he thought by allowing matching of taxes against the time being incurred is a fairer method of doing it, would go that way.
Commissioner Miller said - shouldn't be paying them for accrual in one time period.  If we don't allow this, company just eats taxes for first 9 months (11 1/2 mos. now)  We are not changing rates so he agreed with that part of it.  Don't agree it is like the '86 tax change because don't think it was retroactive.  The law that Congress passed was prospective.  We weren't able to deal with it on prospective because it wasn't handed to us on prospective.  While he agrees with Commissioner Miller that cases that deal with unforeseen circumstances, agree with force majeur but don't know that we are limited to do that.  This was an impossible circumstance.  Thought the company's request was reasonable and we could grant it.
Agreed with company.
17.  Earnings Investigation of Albion Telephone Company - Case No. ALB-T-92-2.
Two votes for that.
18. EAS Petition, Arbon to American Falls.
Commissioner Nelson said he didn't see any reason to consider this outside the generic case.  Think it can wait 6 months.
Agreed.
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19. Discussion of CLosure of Idaho Power Company's Shoshone Office - Case No. IPC-E-93-23.
Commissioner Smith set out the options.
Commissioner Miller asked Commissioner Smith what her thoughts were?
Commissioner Smith said she thought more process was needed.  Company hasn't put on their case.  Local people were pretty persuasive about keeping it open.  Think to give company fair shot to put on their case was the way to go.
Commissioner Miller said in fairness to public point of view, shouldn't make the public responsible for proving through a public hearing but we ought to view the public hearing as sufficient to raise enough concerns to shift the burden to the company to prove that the closure would not result in a threat to adequacy of service.
Brad Purdy said he thought there was still a lot of confusion over the numbers.  Think people are confused about their economic numbers.
Commissioner Smith said the way she thought about it is, she was not measuring dissintegration of service against savings, she was looking at it as to whether or not there is adequate service.  Either service is adequate or it is not.
Brad Purdy said you might just as well reject it outright then.
Commissioner Nelson said having the office there will change the qualify of service, but is it still adequate?
Commissioner Smith said she didn't think the company had had an opportunity to speak to that.
Commissioner Miller said - don't want to foreclose evidence on efficiencies.  Maybe some balancing of savings versus service would be relevant.
Brad Purdy quoted the statute on "economies".
Commissioner Miller said - but if it were shown that the savings were only $2.00 and in contrast to that, the efficiencies were significant, or if customer... you might feel different.
Decision was - hearing.
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Meeting adjourned.
Dated at Boise, Idaho, this 18th day of January, 1994.
Myrna J. Walters
Commission Secretary
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