20100716IPUC's Brief.pdf

SUf-E -"IO-Ò (
IN THE SUPREME COURT OF THE STATE 0ItlR1r?6Pl1 1:0'
BUILDING CONTRACTORS ASSOCIATION ) iDAHO?" \~~ltVJOF SOUTHWESTERN IDAHO, ) UTiUTIES CO Iv,,I...'
) . SUPREME COURT
) DOCKET NO. 37293-2010
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Petitioner/ Appeiiant~
v.
IDAHO PUBLIC UTILITIES COMMISSION,
Respondent on Appeal,
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and
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IDAHO POWER COMPANY,
RespondentlRespondent on AppeaL.
RECEIVED
BRIEF OF RESPONDENT
IDAHO PUBLIC UTILITIES
COMMISSION
APPEAL FROM THE IDAHO PUBLIC UTILITIES COMMISSION
Commissioner Marsha H. Smith, Presiding
MICHAEL C. CREAMER (ISB #4030)
MICHAEL P. LAWRNCE (lSB #7288)
GIVENS PURSLEY LLP
601 W. Bannock Street
PO Box 2770
Boise, ID 03'lOi-2720
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Attorneys for Appellant
Building Contractors Association Southwest of Idaho
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LA WRNCE G. WASDEN
Attorney General
.. .. KRSTINE A, SASSER (ISB #6618)
DONALDL.ROWELL, IT nSB #3366)
Deputy Attorneys General
472 W. Washington Street
PO Box 83720
Boise, ID 83720-0074
Attorneys for Respondent
Idaho Public Utilities Commission
LISA D. NORDSTROM (lSB #5733)
DONOVAN E. WALKER (ISB #5921)
Idaho Power Company
PO Box 70
Boise, ID 83707-0070
Attorneys for Respondentlespondent on Appeal
Idaho Power Company
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TABLE OF CONTENTS
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l STATEMENT OF THE CASE........................................................................................................ i
A. Nature of the Case ................................................................................................................. i
B. The Course of Proceedings............................................................. ........................................2
C.Concise Statement of the Facts.............................................................................................. 4
i. The Initial Line Extension Tar:tProceeding..................................................................... 4
2. The Commission's Initial Decision (Order No. 30853) ..................................................... 7
3. BCA's Initial Intervenor Funding Request......................................................................... 8
4. Reconsideration and the IPUC Hearing................................~....................,........................ 9
5. BCA's Second Request for Intervenor Funding............................................................... i i
6. IPUC Reconsideration Order No. 30955.......................................................................... i i
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J ISSUES PRESENTED ON APPEAL...................... ......................................................... ............ i 4
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ARGUMENT .................. ..,............... .................................... .................................................... .... i 5
A. Standard of Review....... ...................... ....................................................................... ......... i 5
B. The Commission Adequately Explained Its Authority and Reasoning for Changing its
Methodology from "Embedded Costs" to "Actual Facilities Costs" ................................. i 7
C. There is Sufficient Evidence to Support the Commission's Decision to Approve the Line
Extension Allowances Based Upon Idaho Power's Actual Cost of Standard Terminal
Facilities .......................................,...................................................................................... i 9
D. The Holdings of Homebuilders and Boise Water do not Apply to ths Case...................... 21
E. The Denial of BCA' s Intervenor Funding Requests was Based upon Sufcient Evidence
and was withn the Commission's Discretion .................................................................... 26
I. Denial of BCA ' s Initial Funding Request was Appropriate ............................................. 29
2. BCA Failed to Materially ContrbiitetOthe1PUC'.s.Decision......................................... 31
3. BCA's Positions did not Address Issues öfConcem to Ai,e General Body of Ratepayers 33
4. BCA's Costs were Unreasonable .....................................................................................34
F. BCA is not Entitled to an Award of Attorney Fees on Appeal ..........................~~.............. 34
1. BCA is not Entitled to Attorney Fees on Appeal under the Private Attoriey General
Doctrine.............................................................................................................................35
2. BCA is not Entitled to Attorney Fees on Appeal under Idaho Code § 12-117................36
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J CONCL.USION ............................................................................................................................. 39
APPENDIX A - ORDER NO. 30955
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TABLE OF AUTHORITIES
Cases
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A. W Brown v. Idaho Power Co., 121 Idaho at 815, 828 P.2d 841......................................... 16,37
Duncan v. State Bd. of Accountancy, _ Idaho _' _ P.3d _ slip op. at 6, 2010 WL
1632647 (April 23, 2010)..........................................................................................................35
FMC Corp. v. Idaho PUC, 104 Idaho 265, 277,658 P.2d 936 (1983)......................................... 23
Grindstone Butte Mutual Canal Co. v. Idaho Public Utilties Comm 'n,
102 Idaho 175,627 P.2d 804 (1981)...................................................................................24,26
Hayden Pines Water Co. v. Idaho PUC, I II Idaho 331, 723 P.2d 875 (1986)............................ 16
Heller v. Cenarrusa, 106 Idaho 571, 682 P.2d 524 (1984) .......................................................... 35
Hulet v. Idaho PUC, 138 Idaho 476, 65 P.3d 498 (2003)................................................. 16, 17, 19
Idaho Fair Share v. Idaho PUC, 113 Idaho 959, 751 P.2d 107 (1988)........................................ 27
Idaho State Homebuilders v. Washington Water Power,
107 Idaho 415,690 P.2d 350 (1984)..................................................................................passim
In re Avista, 2008 WL 857075 (Idaho PUC) ................................................................................ 33
In re Idaho Power, 2009 WL 2578516 (Idaho PUC) ............................................................... 3, 10
In re Idaho Power, 2009 WL 2844075 (Idaho PUC) ................................................................... 32
In re Rocky Mountain Power, 2009 WL 3159489 (Idaho PUC) .......:.......................................... 33
Industrial Customers of Idaho Power v. Idaho PUC, 134 Idaho 285, 1 P.3d 786 (2000)..... passim
Intermountain Gas Co. v. Idaho PUC, 97 Idaho 113,540 P.2d 775 (1975) .......................... 12, 18
Kootenai Medical Center v. Bonner County Com'rs, 141 Idaho 7, 105 P.3d 667 (2004)............ 35
Owner-Operator Independent Drivers Ass 'n v. Idaho PUC,
125 Idaho 401,871 P.2d 818 (1994)............................................................................. 35,36,37
Roe v. Harris, 128 Idaho 569, 917 P.2d 403 (1996)..................................................................... 35
Rosebud Enterprises v. Idaho PUC, 128 Idaho..6.o9. 917 P.2d 766 (1996) ................12, 16, 18,38
State v. Hagerman Water Right Owners ("HWRQ''),
130 Idao 718, 947 P.2d 391 (1997)................................................................................... 35,36
State v. Pina, _ Idaho _' -- P.3d --,2010 WL 963485 (March 18,2010).......,...............37
Ultrawall v. Washington Mut. Bank, 135 Idaho 832, 25 P.3d 855 (2010) ................................... 37
Utah Power & Light Co. v. Idaho PUC, 105 Idaho 822,673 P.2d 422 (1983)...,.......................... I
Utah-Idaho Sugar Co. v. Intermountain Gas Co., 100 Idaho 368,597 P.2d 1058 (1979)........... 30
Washington Water Power v. Idaho PUC, 101 Idaho 567, 617 P.2d 1242 (1980) .................. 18, 19
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Statutes
Idaho Code § 67-5201(1).........................................................................................:.................... 37
Idaho Code § 12-117 ......................................................................................................~...... passim
Idaho Code § 12-121 ....................................................................................................................35
Idaho Code § 61-305 ...................................................................................................................... I
Idaho Code § 61-315 .................................................................................................. 13,17,21,25
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Idaho Code § 61-501 ....................................................................................................................18
Idaho Code § 6l-617A....................................................................................ò......................passim
Idaho Code § 6 1-625 ............... ....... ........... ............. .......... ............... ............... .............. ................ 30
Idaho Code § 61-626 ............................................................................................................. passim
Idaho Code § 61-629 .................................................................................................................... 15
Idaho Code §§ 61-502 and 61-503 ...................,........................................................................... 17
Idaho Code §§ 61-626 and 61-627 ............................................................................................... 30
Other Authorities
Order No. 30687 ............................................................................................................................. 2
Order No. 30853 .................................................................................................................... passim
Order No. 30883 .......................................................................................................................3,10.
Order No. 30896 .................................................................................................................... passim
Order No. 30900 ............ .............. ..... .......... ........ ..... ................. ..... ...................... ........... .............. 10
Order No. 30955 .................................................................................................................... passim
Rules
I.A.R. 35........................................................................................................................................14
IDAPA 31.01.01.161-.165 ........................................................................................................ 3, 34
IDAPA 31.01.01.164 ....................................................................................................9, 14,27,29
IDAPA 31.01.01.165 .................................................................................................................... 27
IDAPA 31.01.01.201 ......................................................................................................................2
I IDAPA 31.01.01.331.01 ................................................................................................................29
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STATEMENT OF THE CASE
A. Nature of the Case
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This is an appeal from a final Order on reconsideration issued by the Idao Public
Utilities Commission ("Commission" or "IPUC"). The underlying administrative proceeding
was initiated when Idaho Power Company filed an application with the Commission requesting
approval of changes to the Company's line extension tariff. This appeal involves the IPUC's
approval of Idaho Power's line extension tarff. A "tarff" sets out the terms, conditions and
rates for utility services provided to customers. Idaho Code § 61-305.
Line extension costs are incured by Idaho Power when the Company "extends" electric
servce to a previously unserved location. Some of the new line extension facilities (and their
costs) can be attbuted directly to and recovered from the customer who requests new service;
while some facilities wil be used by more than a single customer. The line extension tarff
provides the customer with an installation "allowance" that is a credit against the costs the
customer must pay to obtain s_~iyi.c~. An "allowance" is "a Commission determnation of. . . a
reasonable amount of investment that the Company should make on behalf of new customers in
distrbution facilities. . .." Tr. VoL. II at p. 55, 11. 1-4. When the costs of extending service
exceed the allowance, the requesting customer pays the balance. The allowance or credit amount
becomes par of Idaho Power's rate base, i that is, it is recovered though rates paid by all
customers.
i Generally, a utilty's "rate base represents the original cost minus depreciation of all propert justifiably used by
the utility in providing service to its customers." Utah Power & Light Co. v. Idaho PUC, 105 Idaho 822, 824, 673
P.2d 422, 424 (1983).
RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION I
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In its application and proposed tarff, Idaho Power sought to update its line extension
allowances to better reflect the curent costs of new distrbution facilities necessar to serve new
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a customer pays the appropriate costs of installing new facilities necessar to obtain service, then
a smaller amount of line extension costs wil have to be recovered in the rates paid by all
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customers. In this case, the Commission authorized Idaho Power to update its line extension
tarff rates and charges paid by a new customer to more accurately reflect the curent. costs the
Company incurs to serve that new customer.
B. The' Course of Proceedings
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Idaho Power fied its application and proposed tariff with the IPUC on October 20, 2008.
On November 26, 2008, the Commission issued a Notice of Application and set a deadline for
interested persons to intervene. Order No. 30687, R. Vol. I at 94. Four paries, including the
Building Contractors Association of Southwestern Idaho ("BCA" or "Contractors"),
subsequently requestecLti9.were granted intervention.2 Pursuant to the Commission's notice;
the paries met on Januar 14, 2009, to discuss how the case should be processed atthe IPDC.
The parties agreed that "Modified Procedure" was the appropriate way to process this case.
Under Modified Procedure, the Commission reviews applications based on written comments
submitted by paries and interested persons after it preliminarily finds that the public interest may
not require a formal hearng. IDAP A 31.0 1.0 1.20 I.
i The other paries granted intervention were Kroger, the City of Nampa, and the Association of Canyon County
Highway Districts. These other intervenors are not paries to this appeaL.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 2
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Following the submission of wrtten comments, the Commission on July i, 2009, issued
final Order No. 30853 amending and approving changes to Idaho Power's line extension tarff.
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On July 13, 2009, BCA filed its first request for intervenor fuding pursuant to Idaho
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Code § 61-617A and IPUC Rules, IDAPA 31.01.01.161 through .165. In another final Order
No. 30896 issued September 3,2009, the Commission denied BCA's intervenor fuding request
because the request was nearly two months past the deadline for fiing such requests. R. VoL. III
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at 428. BCA did not seek reconsideration of the decision denying intervenor fuding.
Four petitions for reconsideration of the IPUC's Order No. 30853 approving the new line
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extension tariff were timely fied pursuant to Idaho Code § 61-626. On August 19, 2009, the
IPUC issued Order No. 30883 granting in par and denying in par the petitions for
reconsideration. The IPUC convened a hearng on October 13, 2009, for the paries to present
witnesses and oral argument regarding the issues to be addressed on reconsideration. In
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paricular, the Commission sought fuher evidence whether the amounts of the approved line
extension allowatce~ vyere appropriate. In re Idaho Power, 2009 WL 2578516 (Idaho PUC)..
After reconsideration, BCA again petitioned for intervenor funding on November 9,
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2009. In this second request, BCA sought to recover the initial funding denied by the
Commission in September 2009 in final Order No. 30896, and its attorney and witness fees on
reconsideration. R. VoL. IV at 612.
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On November 30, 2009, the IPUC issued its final order on reconsideration, Order No.
30955. Ths Order furher clarfied, amended, affirmed and rescinded provisions of Idaho
I_.j Power's line extension taff based upon the reconsideration record. The Order also denied
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RESPONDENTBRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 3
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BCA's second intervenor fuding request based upon the standards of Idaho Code § 6 1-617 A
and IDAPA 31.01.01.165. Order No. 30955, Appendix A at 26, R. Vol. iv at 648.3 On Januar
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8,2010, BCA filed its Notice of Appeal from the Commission's final Order on reconsideration.
c. Concise Statement of the Facts
Idaho Power has had a line extension tarff in place . for decades. The line extension tarff
applies to requests for electric service "that require the installation, alteration, relocation,
removal or attachment of Company-owned distribution facilities." R. VoL. I at i I. Prior to the
present 2008 application to update the line extension tarff, Idaho Power last made modifications
to the tarff in 1995. In the present case, Idaho Power proposed to update its line extension
charges "to reflect current costs associated with providing and installng 'standard terminal
facilities' for single-phase and thee-phase service and line installations." R. VoL. I at 5.
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"Standard terminal facilities,,4 are the most commonly installed facilities required to bring
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service to an individual customer in an unserved location. Standard terminal facilties are par of
the distrbution facilities constrcted by the Company.
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1. The Initial Line Extension Tarif Proceeding
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For customers or developers seeking new line extensions, Idaho Power proposed to
provide an allowance equal to the installed costs of these standard facilities. Id The allowance
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provides a fixed credit toward the cost of constrcting terminal facilities and/or line installations
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3 For the convenience of the Court, the IPUC's final order on reconsideration, Order No. 30955, is reproduced in the
Appendix A to this brief. Brief citations to this Order wil be made to Appendix A.
4 Standard terminal facilities include a trsformer, meter, and wiring/service conductor. Order No. 30955,
Appendix A at 2.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 4
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for customers requesting service under the line extension tariff. Id; Tr. VoL. II at 55. Customers
requiring facilities that exceed the cost of the most commonly installed" standard terminal
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facilities" would pay the line extension costs that exceed the amount of the allowance. Thus,
Idaho Power's proposed tarff changes were intended to mitigate intra-class and cross-class
subsidies by requiring customers with greater facilities requirements to pay a larger portion of
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the cost to serve them. Order No. 30955, Appendix A at 22. The allowances credited to new
customers are fuded by Idaho Power, included in the Company's rate base anØ are eventually
recovered in the rates for all customers.
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As par of its application, Idaho Power also proposed to eliminate "per lot refuds" in
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subdivisions in an effort to reduce the growt of rate base that results from issuing refuds.
Idaho Power Reply at 5, R. VoL. II at 267. Since 1995, Idaho Power has given per lot refuds to
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provided to developers were issued when the homes on the developers' lots were eventually sold,
and new individual customers began taking service.
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Staf, the intervenors, and more than 40 members of the public. The Staff agreed in principle
with Idaho Power's rationale that growth should pay for itself and that new customer growth,
combined with the effects of inflation, does indeed cause upward pressure on rates. Staff
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Comments at 3, R. VoL. I at 168.
¡.-, These developer costs did not include the costs of distrbution substations, drop wires, or meters - the components
of the standard facilities provided to individual customers. Order No. 30853 at 12, R. Vol. II at 324.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 5
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BCA and many of the public comments submitted by contractors argued that Idaho
Power's new tarff would create an undue hardship on the constrction industry and negatively
impact the housing market. BCA objected to Idaho Power's proposed changes to the line
extension charges and allowances, and opposed elimination of the per lot refuds to developers.
BCA asserted the proposed changes were inconsistent with the methodology taken by the IPUC
when the line extension tariff was last revised in 1995. BCA Comments at 2, R. VoL. II at 205.
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BCA maintained the focus of the 1995 tarff was on the level of investment for distribution
facilities embedded in existing customer rates, and that "new customers were entitled to have the
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same class." Id
Idaho Power filed reply comments. Idaho Power maintained that, by providing
allowances equal to the cost of the "standard" and most commonly installed facilities, the
Company can help ensure that . the additional costs associated with larger "non-standard"
facilities are recovered from those customers requesting new service ratherthanspreadingthQse
non-standard costs to all ratepayers. Idaho Power Reply at 2, R. VoL. II at 264. Idaho Power
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also disputed BCA' s assertion that updated line extension charges and credits will have a direct
impact on housing prices. The Company argued that the market sets housing prices - not home
,j builders, suppliers, utilities or developers - and that builders and developers have the opportunity
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to adjust their constrction practices to meet current economic conditions. Id at 6, R. Vol ri at
268.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 6
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BCA also filed reply comments disputing Staff s analysis and recommendations
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analysis essentially concurs with BCA's position (that the increased costs of distribution
facilities are attributable to inflation), yet Staf supported a line extension tarff that
disproportonately allocates the additional cost of facilities to new customers simply because
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they are new customers. BCA Reply at 2, R. VoL. II at 254.
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2. The Commission's Initial Decision (Order No. 30853)
After reviewing Idaho Power's application and the wrtten comments, the Commission
issued final Order No. 30853 amending and approving Idaho Power's proposed customer
allowances. The Commission noted that the capital costs of installing new generation and
transmission facilities has always been recovered through the rates paid by all customers. Order
J No. 30853 at 9; R. VoL. II at 321. Distribution facilities are different, however, because "it is
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possible to associate specific facilities with specific customers who use them." Id at 10, R. VoL.
II at 322. Accordingly, "the costs of new distribution plant have, throughout most of Idaho
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Power's history, been recovered in two ways - parially through upfront capital contributions
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from new customers, and parially through electrc rates charged to all customers." Id
Based upon the comments the IPUC found "that Idaho Power's proposed fixed
¡-'allowances of $ 1,780 for single-phase service and $3,803 for thee-phase service represent a fair,
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just and reasonable allocation of line extension costs." Id, Although the allowance amounts
were increased, the per lot refud for subdivisions was eliminated. The Commission rejected
J BCA's argument to increase the per lot refunds. The IPUC found that BCA included
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 7
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inappropriate costs in its calculations and the costs were miscalculated. Id If per lot refuds
were continued or the refud amount increased, then the combination of allowance and lot
refund to the developer would exceed the total distribution cost to provide service to the new
subdivision customers. The Commission determined that basing the developer's allowance on
the cost of transformers was appropriate because transformers may serve more than just a single
customer. Such costs are more reflective of actual costs and how distrbution facilties are
actually deployed. Id at 12, R. VoL. II at 324.
The Commission concluded that the overall changes in the tarff would result in the
appropriate costs being collected from new customers when they request service. This change
would relieve one factor causing upward pressure on all customer rates. ¡d. at II; R. VoL. II at
323. The Commission fuher found "the Company's proposal is imparial to customer class,
Ij minimizes subsidization of terminal facilities costs, and carres the added benefit of
administrative simplicity." ¡d.
3. BCA's Initial Intervenor Funding Request
Nearly two months after the deadline for submitting intervenor fuding requests and
almost two weeks afer the Commission's final Order approving Idaho Power's line extension
tariff, BCA fied its initial request for intervenor fuding. BCA conceded that its request was
iiJ untimely but stated it was an "inadvertent and unintentional oversight by its legal counsel with
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respect to the correct timing of submission of requests for intervenor fuding." Order No. 30896
at 1, quoting BCA Request at 2, R. VoL. II at 328. BCA sought to recover its attorney fees,
Ij witness fees, and reproduction costs totaing $28,386.35. Id. at 5, R. VoL. II at 331.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 8
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The IPUC denied BCA's request for intervenor fuding. The Commission found its RuIe
164 requires a funding request to be fied "no later than fourteen (14) days after the last
evidentiar hearing. . . or the deadline for submitting briefs," whichever is last. IDAPA
31.01.01.164. The Commission found that "the 14-day deadline expired on May 15,2009. BCA
did not fie its request until July 13,2009. BCA's request for intervenor funding is untimely and
is, therefore, denied." Order No. 30896 at 2, R. VoL. III at 429.
Order No. 30896 was denoted as "A FINAL ORDER" and stated that any person seeking
reconsideration of the Order may file a petition for reconsideration within 21 days in compliance
. with Idaho Code § 61-626. Id BCA did not file a petition seeking reconsideration of the
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Commission's decision to deny BCA' s intervenor fuding request.
4. Reconsideration and the ¡PUC Hearing
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J BCA sought reconsideration and clarfication of final Order No. 30853. R. VoL. II at 358.
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BCA argued that the Commission's decision to base allowances on actual standard facilties
costs was a "momentous change in policy." BCA Petition for Reconsideration at 2, R. Vol II at
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methodology from the 1995 case. Id at 4, R. VoL. II at 361. Idaho Power's "investment in
facilities for each new customer should be equal to the embedded costs of the same facilities
used to calculate rates, and those costs in excess of embedded costs should be borne by the
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customers requesting service." Id at 3; R. Vol II at 360. BCA argued that the per customer
estimates of embedded cost for distribution facilties ranged between $1,002 and $1,232. Id at
¡"-.4, R. Vol II at 361.
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RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 9
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BCA stated that the new allowances approved by the Commission will mean "the
Company investment in distribution for new customers wil var from $1,780 for a customer
requesting service to a single location outside a subdivision to as low as $ I 49 for a customer
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receiving identical service within a sixty-lot subdivision." ¡d BCA explained the standard,
transformer can serve from one to ten customers, so the $1,780 allowance wil be equally
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apportioned among the number of new customers served by the new transformer. ¡d. BCA
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requested the Commission grant reconsideration or, in the alternative, clarify "that the
Commission now is rejecting its heretofore longstanding policy that new customers are entitled
to a Company investment in distrbution facilities equal to that made to serve existing customers
in the same class. . . ." ¡d at I I, R. VoL. II at 368.
BCA's Petition for Reconsideration was granted in par and denied in par. The
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Commission parially granted reconsideration for the limited issue of reviewing the appropriate
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allowances (e.g., $1,780 for single-phase service and $3,803 for three-phase service). The
Commission directed BCA to address what allowance amounts are reasonable based on the cost
of new distribution tàcilitIes. Order No. 30883, 2009 WL 2578516 (Idaho PUC). The
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reconsideration hearng was held on October 20,2009, and post-hearng briefs were filed. Order
No. 30900, R. VoL. II at 502.
J On reconsideration, Idaho Power argued that the Contractors' proposal would create an
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unlawfl preference for developers because they would receive a more generous allowance "for
speculative lots inside a residential subdivision based on facilities that are not considered for
allowances to actual new residential customers outside of subdivisions." Idaho Power Post-
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IDAHO PUBLIC UTILITIES COMMSSION 10
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hearng Brief at 7, R. VoL. III at 603. Moreover, "because transformers often serve more than
one ultimate customer, offering developers an allowance on a "per lot" basis rather than on a
"per transformer" basis can also lead to the unreasonable result that the allowance is greater than
the cost of terminal facilties. . . required to provide service." Id
$. BCA's Second Requestfor Intervenor Funding
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After the reconsideration hearng, BCA submitted a second request for intervenor fuding
under Idaho Code § 61-6l7A. R. VoL. iv at 612. In its second request, BCA again sought the
fuds previously denied by the Commission as untimely ($28,386.35) in Order No. 30896. BCA
iJ also requested additional attorney fees ($23,450), witness fees ($8,464.16), and costs ($664.74).
Thus, BCA's second fuding request totaled $60,965.25.6 Order No. 30955, Appendix A at 23.
J 6. IPUC Reconsideration Order No. 30955
J a. Change in Methodology. Afer reviewing the additional evidence and arguments
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offered on reconsideration, the Commission issued its final order on reconsideration on
November 30, 2009. Order No. 30955, Appendix- A. In response to BCA's request for
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that approved in 1995. Id, Appendix A at 20. Relying on case law, the IPUC explained that
"Because regulatory bodies perform legislative as well as judicial fuctions in their proceedings,
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cases in the same way as they have decided similar cases in the past." Rosebud Enterprises v.
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6 Under Idaho Code § 6 i -6 i 7 A(2), intervenor funding in any proceeding shall not exceed the total of $40,000 "for
all intervening paries combined."
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IDAHO PUBLIC UTILITIES COMMISSION I I
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Idaho PUC, 128 Idaho 609, 618, 917 P.2d 766,775 (1996) citing Intermountain Gas Co. v.
Idaho PUC, 97 Idaho 113, 119,540 P.2d 775, 781 (1975).
b. Affrming the Rates and Allowances. The Commission afrmed. that line extension
charges based on the curent installation cost of standard terminal facilities for single-phase and
three-phase service to new customers was just and reasonable. Order No. 30955 citing Order
No. 30853 at 10; Tr. at 140-41, 267, Appendix A at 21. Based upon the testimony of Idaho
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Power witnesses, the IPUC found the appropriate allowance for .,single-phase service is $ 1 ,780
and $3,803 for three-phase service. Order No. 30955 citing Tr. at 140-141, Appendix A at 21-
iJ 22. "Because the allowance is calculated on a per transformer basis and not a per customer
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basis, the allowance inside and outside subdivisions provides the same Company investment."
Order No. 30955 citing Order No. 30853 at 12; Tr. at 276-77, Appendix A at 21.
j The Commission was not persuaded by BCA's argument to continue and increase the per
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lot refud. The IPUC found that the BCA recommended lot refuds inappropriately included
costs for substations, meters, and service conductor: Order No. 30955 citng Tr. at 274-276, 277,
iJ Appendix A at 22. The Commission reasoned that after increasing the allowances to developers,
continuing lot refuds would cause the allowances to exceed the cost of the facilities provided.
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Order No. 30955, Appendix A at 21-22.
i..c. Homebuilders Discrimination. The Commission rejected BCA's argument that the
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new allowances would result in unfair discrimination between "new" customers and "existing"
("old") customers. Id., Appendix A at 22. The Commission found that the new taff does not
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IDAHO PUBLIC UTILITIES COMMISSION 12
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Washington Water Power, 107 Idaho 415, 690 P.2d 350 (1984). The Commission explained
that:
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In Homebuilders, our Supreme Cour determined that the Commission could not
impose a charge on only new customers to recover the costs of additional
generating resources that served all or "existing" customers. Here, the
Commission is addressing distribution costs not resource costs. We are setting
line extension charges based on the costs of standard terminal facilities that wil
be used to serve only the customer who is charged.
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More importantly, the Supreme Cour noted that there is no discrimination
between "new" customers and "old" customers when the Commission sets. new
line extension charges. Homebuilders, 107 Idaho at 421,690 P.2d at 356. More
specifically, the Cour noted that no discrimination is present "when a non-
recurrng charge (e.g., a line extension charge) is imposed upon a new customer
because the service they require demands an extension of existing distribution or
communication lìnes and a charge is imposed to offset the utility's capital
investment (in serving new customers)." Id.
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Idaho Power's line extension charges are imposed only on those customers who
will be served by the new facilities. The new facilties wil provide service only
to those customers who pay for them. The line extension allowances and charges
are based upon the cost of terminal facilties. Once new customers pay the
nonrecurrng chargelIne extension costs, they become existing customers and pay
pursuant to the same rate schedule as all other existing customers in their class.
As such, there is no distinctiQaJ::ietween new and existing customers in regard to
nonrecuring rates and no rate discrimination. Idaho Code § 61 -315.
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Order No. 30955, Appendix A at 22-23 (emphasis added). Simply put, there is no discrimination
I¡c.J when the Commission resets line extension allowances and rates based upon costs.
The Commission concluded that the changes to the taff addressed a fudaental
principle of utility regulation: "To the extent practicable, utility costs should be paid by those
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above the amount of the allowance offset the cost to all ratepayers of connecting the new
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IDAHO PUBLIC UTILITIES COMMISSION 13
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customer to Idaho Power's system. The Commission found that the allowance "amount of
$1,780 is based on the current installation cost of standard terminal facilities for single-phase
service to new residential customers." Id. The Commission specifically reaffirmed its earlier
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decision "that allowances should be based upon the cost of standard terminal facilities and not on
a per lot basis." Id., Appendix A at 22. .
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d. BCA's Second Intervenor Funding Request. The Commission denied BCA's
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$60,965.25 funding request. First, the Commission noted that it had previously denied BCA its
initial fuding request of $28,386.35 for its failure to timely submit the request. The
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Commission found that BCA "filed its (intervenor fuding) request nearly two months afer the
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14-day deadline established by Commission" Rule 164, IDAPA 31.01.01.164. Order No. 30955,
Appendix A at 25. The IPUC affrmed its initial decision.
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As to the BCA expenditures during the reconsideration phase, the Commission found that
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BCA did not meet all of the fuding standards of Idaho Code § 61-617A. In paricular, BCA did
not materially contribute to the .commission's final decision, BCA's requested costs were not
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ratepayers. Order No. 30955, Appendix A at 26. Consequently, the IPUC denied the request in
its entirety.
i_~.J ISSUES PRESENTED ON APPEAL
J The IPUC contends the issues on appeal listed in BCA.'s brief are insufcient and
incomplete, and so wil state the issues consistent with I.A.R. 35, as follows:
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IDAHO PUBLIC UTILITIES COMMISSION 14
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I. The Commission adequately explained its authority and reasoning for changing its
methodology from "embedded costs" to "actual facilties costs."
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customer line extension allowances based upon Idaho Power's actual cost of stadard terminal
facilities.
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4. The denial of BCA's intervenor fuding requests under Idaho Code § 61-617A were
based upon substantial and competent evidence and were a proper exercise of the Commission's
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5~ BCA is not entitled to an award of attorney fees on appeal under the private attorney
general doctrine or Idaho Code § 12-117.
J ARGUMENT
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A. Standard of Review
The standard.of review for Orders of the Commission are well settled. "The review
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pursued its authority, including a determination of whether the order appealed from violates any
right of the appellant under the constitution of the United States or the state of Idaho." Idaho
j Code § 61-629.
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With regard to findings of fact, if the Commission's findings are supported by
substantial, competent evidence this Court must affirm those findings, Industrial Customers of
LJ Idaho Power v. Idaho PUC, 134 Idaho 285, 288, 1 P.3d 786, 789 (2000), even if the Cour would
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IDAHO PUBLIC UTILITIES COMMISSION 15
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have made a different choice had the matter been before it de novo. Hulet v; Idaho PUC, 138
Idaho 476, 478, 65 P.3d 498, 500 (2003). "Thus, the IPUC's findings of fact must be affirmed
unless it appears that the clear weight of the evidence is against the conclusion, or that the
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evidence is strong and persuasive that the IPUC has abused its discretion." Rosebud Enterprises
v. Idaho PUC, 128 Idaho 609, 618, 917 P.2d 766, 775 (1996). On questions of law, review is
limited to the determination of whether the Commission has regularly pursued its authority.
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A. W Brown v. Idaho Power Co., 121 Idaho at 815,828 P.2d at 844; Hulet, 138 Idaho at 478,65
P.3d at 500.
Î;"J The "Commission as the finder of fact, need not weigh and balance the evidence
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presented to it, but is free to accept certain evidence and disregard other evidence." Industrial
Customers, 134 Idaho at 293, I P.3d at 794. "The commission is free to rely on its own expertise
as justification for its decision." Id. Simply put, the findings of the Commission must be
reasonable "when viewed in the light that the record in its entirety furnishes, including the body
of evidence opposedttlthe. (Commission's) view." Hayden Pines Water Co. v. Idaho PUC, 111
Idaho 331, 336, 723 P.2d 875,880 (1986).
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The Commission's orders must present suffcient findings and contain the reasoning
behind its conclusions to suffciently allow the Cour to determine that the Commission did not
act arbitrarily. Rosebud Enterprises, 128 Idaho at 618, 917 P.2d at 775. The Commission's
findings need not take any paricular form so long as they fairly disclose the basic facts upon
which the Commission relies and support its decisions. Id. at 624, 917 P .2d at 781. "The burden
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IDAHO PUBLIC UTILITIES COMMSSION 16
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is on the pary challenging the Commission's findings to show that they are unsupported by the
evidence." Hulet, 138 Idaho at 478,65 PJd at 500.
The Commission's authority to set a regulated utility's rates is not unfettered. Idaho
Code § 61-315 prohibits either preferential or discriminatory treatment of ratepayers by public
utilities. However, on appeal, the Commission's Order or ruling will not be set aside unless it
has failed to follow the law or has abused its discretion. Application of Boise Water Corp., 82
Idaho 81, 86, 349 P.2d 71 1,713 (1960) (citing cases). The IPUC is empowered to determine any
question of fact when discrimination or preference is alleged. Idaho Code § 61-315.
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B. The Commission Adequately Explained Its Authority and Reasoning for Changing its
Methodology from "Embedded Costs" to "Actual Facilties Costs"
The Contractors maintained that Idaho Power's new line extension tarff is inconsistent
with the methodology that the Commission adopted in the 1995 line extension case. The 1995
allowance was tied to an estimate of what new customer distribution costs were embedded in
rates. In this case, Idaho Power requested and the Commission approved changes in the lin~,
J . extension allowances in par because, under the ~Id methodology, revenues generated afer"
connecting new customers were inadequate to cover the costs associated with serving those
¡customers. Order No. 30955, Appendix A at 22.
BCA asserted that the Commission canot change its methodology from the 1995 case.
BCA Brief at 6. However, the Commission has broad authority granted by statute to regulate
and fix the rates and charges assessed by Idaho's public utilities. Idaho Code §§ 61-502 and 61-
J 503. The Public Utilties Law vests the Commission with the "power and jursdiction to
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IDAHO PUBLIC UTILITIES COMMSSION 17
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supervise and regulate every public utility in the state and do all things necessar to cary out the
spirit and intent of the provisions of this act." Idaho Code § 61-501.
More importtly, this Cour has held that, "Because regulatory bodies perform
legislative as well as judicial fuctions in their proceedings, they are not so rigorously bound by
the doctrine of stare decisis that they must decide all future cases in the same way as they have
decided similar cases in the past." Rosebud, 128 Idaho at 618, 917 P.2d at 775 citng
Intermountain Gas Co. v. Idaho PUC, 97 Idaho 113, 119, 540 P.2d 775, 781 (1975); Order No.
30955, Appendix A at 21. "So long as the Commission enters sufficient findings to show that its
action is not arbitrar and capricious, the Commission can alter its decisions." Washington
Water Power v. Idaho PUC, 101 Idaho 567, 579, 617 P.2d 1242, 1254 (1980).
In its Order No. 30955, the Commission listed the reasons why it changed the
methodology. The Commission found that different circumstaces exist now than did in 1995.
Order No. 30955, Appendix A at 21. The new allowances for single-phase and thee-phase
serviçe mare appropriately reflect "the current installation cost of. standard termination facilities
.. for single-phase service-to new residential-customers." Id citng Order No. 30853 at 10; Tr: åt
140-41, 267, Appendix A at 21. "Because the (new J allowance is calculated on a per transformer
basis and not a per customer basis, the allowance inside and outside subdivisions provides the
same company investment. Permitting a per customer allowance rather than a per transformer
allowance could lead to an allowance inside subdivisions that is greater than the cost of the
terminal facilities required to provide service" to new customers. Order No. 30955 citing Order
No. 30853 at 12; Tr. at 276-77, Appendix A at 21. In addition, the Commission was not
RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 18
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persuaded by the testimony offered by BCA's witness. The Commission agreed with Idaho
1..1 Power witness Greg Said who testified that the calculations pedormed by BCA' s witness "tends
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to provide allowances in subdivisions that exceed the costs of standard terminal facilities. . . ."
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Order No. 30955 quoting Tr. at 270; Appendix A at 22.
It is clear from Order No. 30955 that the Commission accepted certain evidence and
discarded other evidence. Industrial Customers, 134 Idaho at 293, I P.3d at 794. As set out
above, the Commission's findings are supported by substantial and competent evidence in the
record. Consequently, the Cour must affirm those findings and the Commission's decision. Id
)J at 288, 1 P.3d at 789; Hulet, 138 Idaho 476, 65 P.2d 498 (2003). Moreover, there are suffcient
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findings to show that the Commission's change in methodology is not arbitrar and capricious.
Washington Water Power, 101 Idaho at 579, 617 P.2d at 1254.
iJ C. There is Sufficient Evidence to Support the Commission's Decision to Approve the Line
Extension Allowances Based Upon Idaho Power's Actual Cost of Standard Terminal
Facilties
The Commission explained in its Order No. 30955 that, in approving Idaho Power'.s new
. line extension charges, it wasadr.esing a fudamental principle of utility regulation: To the
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extent practicable, utility costs should be paid by those that cause the utility to incur the costs.
Order No. 30955, Appendix A at 2 I. Thus, while the method of determining an appropriate
allowance may have changed, the Commission's. goal remains the same, e.g., to prevent an
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unreasonable portion of the line extension costs from being shifted to base rates paid by all
customers. Utilty costs should be paid by those that cause the utility to incur the costs. Id
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IDAHO PUBLIC UTILITIES COMMISSION 19
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Based upon the testimony of Idaho Power witnesses, the Commission found that the
appropriate allowance based upon the current installation costs of standard terminal facilities
should be up to $1,780 for single-phase service and up to $3,803 for three-phase service to new
customers. Order No. 30955 citng Tr. at 140-41,267, Appendix A at 21-22. BCA's supporting.
testimony was unpersuasive because the calculations included inappropriate costs. The
Commission observed:
At the reconsideration hearing, BCA's witness Dr. Richard Slaughter argued that
the line extension allowance or lot refund should be equal to $1,232 per lot (single
residential customer). Tr. at 234. As Company witness Greg Said explained,
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residential subdivisions more favorably than individual customers
seeking connections outside of subdivisions. (His per lot mechanism)
tends to provide allowances in subdivisions that exceed the cost of
standard terminal facilities with the excess allowances offsetting the
cost of primar conductor and secondar conductor. Such treatment is
inconsistent with the treatment of residential customers outside of
subdivisions who do not receive an allowance greater than the cost of
standard terminal facilities.
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Tr. at 270. Mr. Said also explained that Dr. Slaughter's $1,232 cost per lot r.efuq
'I?Posal inappropriately includes costs from substations, meters and service
conductors which arnotpar ofline extension costs. Tr..at277,274-76.
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Order No. 30955, Appendix A at 22 (emphasis added).
The Commission also noted that moving to an allowance based upon the curent costs of
standard terminal facilities is more accurate because a transformer may serve multiple customers.
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Specifically, the Commission clarfied that:
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Depending upon the geographic configuration of customer locations, transformers
can serve multiple customers. Because the allowance is calculated on a per
tra.risformer basis a.rid not a per customer basis, the allowance inside and outside
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IDAHO PUBLIC UTILITIES COMMISSION 20
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subdivisions provides the same Company investment. Permitting a per customer
allowance rather than a per transformer allowance could lead to an allowance
inside subdivisions that is greater. than the cost of the terminal facilties required
to provide service.
Id, Appendix A at 21 (internal citations omitted).
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Idaho Power's line extension tarff had not been updated for more than 10 years. The
combined effects of inflation on facilities costs, the rate of new customer growth, and changes in
line extension policies over time have all been factors in putting upward pressure on rates. The
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Commission found that "By updating line installation charges and increasing the allowances, the
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appropriate amount of contribution will be provided by new customers requesting these
services." Order No. 30853 at II, R. VoL. II at 323. There is substantial and competent evidence
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to support the Commission's finding on allowances. Industrial Customers, 134 Idaho at 288, I
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P.3d at 789. These allowances mitigate intra-class and cross-class subsidies and represent a fair,
just and reasonable allocation ofIine extension costs. Order No. 30955, Appendix at 22.
D. The Holdings of Homebuilders and Boise Water do not Apply to this Case
BCA argues that the Commission's Order No. 30955 "authorizes Idaho Pa.wer to charge
new customers discriminatory rates and charges in violation of the anti-discrimination provisions
of Idaho Code § 61-315 and the Idaho Supreme Cour's decisions in Homebuilders and Boise
Water." BCA Brief at 18. Despite BCA's arguments to the contrar, the facts of this case are
completely different and this case is not controlled by Homebuilders and Boise Water.7 In
~"-.Homebuilders, ths Cour determned that the Commission could not impose a charge on only
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7 Idaho State Homebuilders Y. Washington Water Power, 107 Idaho 415,690 P.2d 350 (1984) and Application of
Boise Water, 128 Idaho 534, 916 P.2d 1259 (1996).
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IDAHO PUBLIC UTILITIES COMMISSION 21
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new customers to recover the costs of additional generating resources to serve all or "existing"
customers. 107 Idaho at 421, 690 P.2d at 356. In this case, the Commission is addressing
distribution costs - not the cost of transmission or generation facilities. As the Commission
made clear in Order No. 30955, it is setting new "line extension charges based on the cost of
standard terminal facilities that win be used to serve only the customer who is charged." Order
No. 30955, Appendix A at 22.
More importantly, the Homebuilders Court Îndicated that there is no discrimination
between "new" customers and "old" customers when the Commission is setting new line
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extension charges. 107 Idaho at 421, 690 P.2d at 356. Specifically, the Cour indicated that no
discrimination is present "when a non-recurrng charge (e.g., one-time line extension charge J is
imposed upon new customers because the service they require demands an extension of existing
distribution or communication lines and a charge is imposed to offset the cost of the utilty's
capital investment." ld (emphasis added); Order No. 30955, Appendix A at 22-23. That is the
exact situation in this case.
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those customers who will be served by the new facilties. The new facilties win provide service
only to those customers who pay for them." Order No. 30955, Appendix A at 23. The line
extension charge is intended to offset the amount of the utì1ty's capital invested for each
customer requesting new service. Again, setting line extension charges is the very activity
mentioned by the Homebuilders Cour as permissible and not violative of the prohibition on
RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMSSION 22
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discriminatory rates. 107 Idaho at 421, 690 P.2d at 356. Therefore, any argument regarding
"old" and "new" customers is inapplicable to the facts of this case.
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In fact, BCA concedes that the Commission can authorize charges that new customers
pay. for their connection facilities. "It is well settled, and BCA does not contest, that Idaho
Power can charge new customers for the new service attachments and distrbution line
installations attributable to them." BCA Brief at 7. BCA takes issue with the amount of the
allowance, that is, the Company's "level of investment" in new customers connecting to the
system. Id
BCA is correct that Idaho Power's level of investment has changed. However, "the
singular fact of a mere difference in the rates charged the varous customers . . . is insufficient to
establish unjustifiable discrimination. . . ." FMC Corp. v. Idaho PUC, 104 Idaho 265, 277, 658
P.2d 936, 947 (1983) (internal citations omitted). The new allowances are reasonably tied to the
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cost of the facilities being built. Order No. 30955, Appendix A at 21 -23. If the cost-causers are
not required to contribute more toward the costs associated specifically with their obtaining
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l " electric service, then electric rates for all customers must be increased: Id, Appendi A .at 21.
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Such a result would not be just and reasonable.
"(T)he Commission is not under a duty to set rates for different classes of customers
which are either equal or uniform provided the rates set are just and reasonable. . .." FMC
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Corp., 104 Idaho at 275-276, 658 P.2d at 946-947 (internal citations omitted). The question is
"whether the evidence as a whole in light of the circumstaces of the paricular case supports the
J differentiation, substantially, competently and with a just and reasonable result." Grindstone
IJ RESPONDENT BRIEF OF THE
IDAHO PUBLIC UTILITIES COMMISSION 23
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Butte Mutual Canal Co. v. Idaho Public Utilties Comm 'n, 102 Idaho 175, 18 I, 627 P.2d 804,
810(1981).
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(TJhe relevant criteria (to consider when forming a basis for rate differentiation
include J the quantity of the utility used, the nature of the use, the time of use, the
pattern of use, the differences in the conditions of service, the costs of service, the
reasonable efficiency and economy of operation and the actual differences in the
situation of the consumers for the fuishing of the servce. Specifically, as
between classes of customers withn a schedule, the criteria included contribution
to peak load, costs of service on peak demand days, costs of storage and economic
incentives. We find such criteria as being valid considerations for rate
differentiation as between classes of service, whether those classes be as between
schedules or as between customers within a schedule.
Id, 102 Idaho at 180,627 P.2d at 809. 8
BCA also contends the new allowance strcture unlawfully discriminates between
customers inside and outside a subdivision. BCA Brief at 22. On the contrar, all customers
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requesting service are eligible for an allowance that reflects the cost incurred by Idaho Power to
serve that customer. Order No. 30955, Appendix A at 23. Customers are eligible to receive
maximum allowances up to $1,780 for single-phase services and $3,803 for thee-phase services
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per service attachment. Id., Appendix A at 22. Developers of subdivisions are eligible to receive
the same amounts for each transformer installed within a development. Id The distinction
J between a "service attachment" for customers and a "transformer" for developers is
straightforward: service conductor and meters are not installed within subdivisions until later
when homes are actually constructed and customers connect to the grid. Moreover,
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8 Although the Court's reasoning in Grindstone Butte provided some of the foundation for the Homebuilders
decision, Grindstone Butte provides a more thorough analysis of the factors that the Commission must consider in
setting rates and establishing charges.
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IDAHO PUBLIC UTILITIES COMMSSION 24
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(dJevelopers of subdivisions (businesses that do not take electric service). . .
receive Company-funded allowances. . . to help offset their development costs.
Here, developers are paying for and installing a portion of potential future
customers' terminal facilties above the Company's investment as part of a
business venture; they are not customers of Idaho Power~ These allowances
(Company investment) are credited directly to developers at a reduced cost that
mayor may not be passed on to home buyers (future rate paying customers).
Idaho Power Answer to Petitions for Reconsideration at 4, R. VoL. II at 387.
BCA notes that "in a subdivision a single transformer may serve multiple (up to ten)
customers if those customers are located in suffcient proximity to each other, whereas, in the
case of a single customer requesting service outside a subdivision, a transformer wil only serve.
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transformer allowance is more equitable. The result is not discriminatory, it is based entirely on
the difference in costs to bring service to those customers inside a subdivision. Order No. 30955,
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incurs lower costs to connect the customers to its system. BCA's position would provide an
unlawfl preference to developers by offering a more .generous allowance for lots ("customers")
-ìj inside a residential subdivision based on costs that will not be incured by the developer. for .
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facilities that have not been constrcted by Idaho Power. Id Such a result is not just and
reasonable.
BCA also opposed the Commission's elimination of an $800 per subdivision lot refud
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"that accounted for (i.e., made up for) what previously was deemed an insuffcient level of
investment that. would occur if the Company provided only an allowance for Terminal
Facilities." BCA Brief at 22. The Commission reasoned that, after allowing increased
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IDAHO PUBLIC UTILITIES COMMISSION 25
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allowances to a developer up-front, providing lot refuds would cause the allowance to exceed
the cost of the facilities provided. Order No. 30853 at 12, R. VoL. II at 324. The Commission's
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determination was well-reasoned and based on substantial and competent evidence. Industrial
Customers, 134 Idaho at 288, I P.3d at 789.
Regardless of whether construction is inside or outside a subdivision, Idaho Power's line
extension tarff provides customers and developers a fixed allowance toward their required
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terminal facilities. Order No. 30955, Appendix A at 21. The Commission-approved allowances
are based on Idaho Power's costs to install standard services and account for actual differences in
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reasonable allocation of line extension costs. See Grindstone Butte, 102 Idaho at 181, 627 P.2d
at 810.
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J E. The Denial of BCA's Intervenor Funding Requests was Based upon Suffcient Evidence
and was within the Commission's Discretion
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J To encourage customer paric:ipatiQ.nin ¡PUC proceedings, the Legislature authorized the
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Commission to award "legal fees, witness fees, and reproduction costs" to intervenintS paries
under standards set out in Idaho Code § 61-6 i 7 A. The Commission may order certain utilities to
pay all or a portion of these fees and costs to one or more paries, not to exceed a total for all
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intervening paries combined of $40,000. The narow standards for awarding intervenor fuding
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are set out in Idaho Code § 61-6 i 7 A(2). The funding stadards applied to BCA require that the
Commission find:
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(a) BCA's involvement in this case must have materially contrbuted to the
Commission's final decision;
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IDAHO PUBLIC UTILITIES COMMISSION 26
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(b) BCA' s costs of intervention awarded are reasonable in amount;
(c) Its costs of intervention are a significant hardship for BCA;
ìJ (d) The recommendations of BCA differed materially from the testimony and
exhibits of Commission Staff; and
ij ( e) BCA addressed issues of concern to the general body of ratepayers.
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Idaho Code § 61-617A; IPUC Rule 165, IDAPA 31.01.01.165).9 Any award of intervenor
funding is within the Commission's discretion. Idaho Fair Share v. Idaho PUC, 113 Idaho 959,
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963, 751 P.2d 107, ILL (1988) (the decision of the adjudicating body in deciding attorney fees
wil not be overtrned on appeal absent an abuse of discretion).
BCA's initial intervenor fuding request was made following issuance of the
Commission's initial final Order No. 30853. BCA asked for the following fees:
J Attorney fees
Consultant fees
Copying
Total
$16,567.50
$11,462.50
$ 356.35
$28,386.35
Hours
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BCA Funding Request at 5, R. VoL. IT at 331. The Commission denied the funding request
because it was fied nearly two months after the fiing deadline set by ¡PUC Rule 164. This rule
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afer the last evidentiary hearng in a proceeding or the deadline for submitting briefs, proposed
orders, or statements of position, whichever is last." IDAPA 31.01.01.164. The Commission
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9 Funds paid by the applicable utilty to an intervenor become par of the utilty's costs. Section 61.617 A(5)
prohibits intervenor funding to intervenors "in direct competition with a public utilty involved in proceedings
before the Commission." The Commission is also authorized to adopt rules to implement the statue. Idaho Code §
Ó 1-61 7 A(4).
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IDAHO PUBLIC UTILITIES COMMISSION 27
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found in its final Order No. 30896 that "the 14-day deadline expired on May 15,2009. BCA did
1. j not fie its request until July 13, 2009." Order No. 30896 at 2, R. Vol. III at 429. Order No.
iJ 30896 was denoted as "A FINAL ORDER" and paries aggrieved by the Order were advised that
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they may seek reconsideration within 21 days pursuant to Idaho Code § 61-626(1). Id (capitals
original). BCA did not seek reconsideration of Order No. 30896.
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its second request BCA again sought to recover its legal and witness expenses previously denied
by the Commission in Order No. 30896. More specifically, BCA requested the $28,386.35
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($664.74) incurred durng reconsideration for a total of $60,965.25.10 Order No. 30955,,
I~~J Appendix A at 23.
j BCA admitted that its initial petition was untimely, but contends that the Commission
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abused its discretion in denying the Contractors' initial and subsequent request for all of its costs
and fees through its second,.petition for intervenor fuding. In its order on reconsideration, the
IPUC pointed out that because BCA'sfirst request for intervenor fuding was untimely, it would
only consider the request as it pertned to the reconsideration phase of the case. Id, Appendix
A at 25. After reviewing BCA's second request, the Commssion determined that the
iJ Contractors' petition did not meet all of the Section 61-617 A standards for fuding. ii The
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all intervening parties combined."
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from the Staffs positions. Order No. 30955 at n.6, Appendix A at 26.
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IDAHO PUBLIC UTILITIES COMMISSION 28
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Commission found that BCA's paricipation did not materially contribute to the final decision in
the case (Idaho Code § 61-617 A(2)( a)); that BCA' s advocacy did not address issues of concern
to "the general body of users or consumers" (Idaho Code § 61-617A(2)(b)); and that BCA's
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costs were unreasonable because its activities were beyond the scope of reconsideration (Idaho
Code §.61-617A(2)(b)). Order No. 30955, Appendix A at 26.
IiJ 1. Denial of RCA's Initial Funding Request was Appropriate
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BCA argued in its brief that the Commission abused its discretion when it again denied
BCA its initial intervenor fuding request. BCA asserted that the Commission decided "without
J explanation" to again deny the initial funding request. BCA Brief at 40. Contrar to BCA's
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characterization, the Commission did explain its reasoning for denying the initial funding
request. In Order No. 30955, the Commission stated it was being consistent with its previous
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initial funding request "nearly two months afer the 14-day de.adline" established by Commission
Rule 164, IDAPA 3UH.Q.l,164. Order No. 30955, Appendix A at 25.
Moreover, the Commission's initial denial in Order No. 30896.o.was clearly labeled as a
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final Order ("THIS IS A FINAL ORDER.") (capitals in original). Order No. 30896 at 2, R. VoL.
II at 429. As a final order, BCA's recourse was to file a petition for reconsideration as required
by Idaho Code § 61-626 within 21 days of the issuance of Order No. 30896, i.e., by September
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24, 2009. BCA did not fie a petition for reconsideration within 21 days in accordance with
Idaho Code § 61-626(1) and Rule 331.01, IDAPA 31.01.01.331.01. Having failed to exhaust its
administrative remedy by fiing a petition for reconsideration pursuant to Section 61-626(1),
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IDAHO PUBLIC UTILITIES COMMISSION 29
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BCA merely resubmitted its initial fuding request at a later time. This was not and is not the
appropriate procedure.
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Idaho Code § 61-625 states that all "orders and dec'isions of the commission which have
become final and conclusive shall not be attacked collaterally." The initial denial of funding was
a final order. Order No. 30896 at 2, R. VoL. II at 429. As this Cour has noted, the Legislatue
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has afforded the orders of the Commission a degree of finality similar to that possessed by
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judgments made by a cour of law. Utah-Idaho Sugar Co. v. Intermountain Gas Co., 100 Idaho
368, 373, 597 P.2d 1058, 1063 (1979). "Final orders of the Commission should ordinarly be
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challenged either by petition to the Commission for (reconsideration) or by appeal to this Cour
as provided by Idaho Code §§ 61-626 and 61-627." Id The Cour recognized that a "different
rule would lead to endless consideration of matters previously presented to the commission and
confusion about the effectiveness of Commission orders." Id at 373-74,597 P.2d at 1063-64.
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What canot be disputed is the fact that BCA's initial funding request was untimely by
nearly two months~ ..The caption ofBCA's request states that it is "Late-Filed" and that it was an -~..O!"'..
"inadvertent and unintentional oversight by its legal counsel with respecUo the correct timing for
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submission of request for intervenor fuding." BCA Late-filed Petition for Intervenor Funding
at 1-2, R. VoL. II at 327-28. The initial request fuer asks the Commission to "exercise its
discretion to waive the Commission Rule 164 filing deadline." Id at!. It would be
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unreasonable to award intervenor fuding when BCA filed an untimely request for intervenor
f\ding and did not fie the requisite petition for reconsideration required by Idaho Code § 61-
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626. BCA should not be permitted to bootstrap its initial fuding request with its second request
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IDAHO PUBLIC UTILITIES COMMISSION 30
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for intervenor funding. Having already denied BCA's initial request for intervenor fuding, the
Commission was simply being consistent with its final Order No. 30896. Order No. 30955,
Appendix A at 25.
2. BCA Failed to Materially Contribute to the ¡PUC's Decision
BCA next argued that the Commission abused its discretion by finding that BCA did not
materially contribute to the Commission decisions in Order No. 30955. Although it did not
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prevail, BCA maintained that it materially contrbuted though the submission of written
comments, testimony, briefs, and paricipation during the technical hearing. BCA asserted that
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the Commission utilized a heightened standard in determining what amounts to material
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contribution. "Under the Commission's interpretation, a pary only is entitled to intervenor
funding if they prevail on an issue." BCA Brief at 39 (emphasis original).
J In finding that BCA did not materially contrbute, the Commssion observed that "BCA,
in large par, recycled its arguments and reasoning from Idaho Power's 1995 Rule H filing."
Order No.30955, Appendix A at 26. BCA did not present any new analysis or logic to persuade
the Commission that its position warante.her considerati. _BCA even conceded that "(iJt
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may be tre that much ofBCA's case today resembles the 1995 Case. . . ." BCA Brief at 38.
In partially granting BCA's petition for reconsideration, the Commission limited
¡_J reconsideration to the issue of whether the new "allowance amount is reasonable based upon the
cost of new distribution facilities (i.e., the standard terminal facilities)." Order No. 30955,
Appendix A at 6. Most of BCA's evidence and argument on reconsideration was devoted not to
-~;the appropriate calculations of the single-phase and three-phase allowances in the new
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IDAHO PUBLIC UTILITIES COMMISSION 31
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methodology, but to urging the Commission to continue using the old methodology and increase
lot refuds. Id, Appendix A at 26. BCA's fixation on the old methodology was outside the
J scope of reconsideration. In fact, the Commission found "clarification was repeatedly necessary
durng the technical hearing (to determine J which case BCA was referencing - 1995 or the
present application. Tr. at 176, 258-59, 296." Id The Commission specifically found that it
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"was not persuaded by BCA's arguments. Accordingly, the Commission canot find that BCA's
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actions materially contributed to our final decision in this case." Id
As the finder of fact, the Commission "need not weigh and balance the evidence
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Customers, 134 Idaho at 293, i P.3d at 794. The Commission found that BCA's witness
continued to argue for the old per lot methodology at an allowance of $1,232 per lot. The
Commission was persuaded from testimony offered by Idaho Power witness Greg Said that
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BCA's proposal "inappropriately includes costs from substations, meters, and service conductors
which.are not partof line extension costs." Order No. 30955, Appendix A at 22. _ .:The.....
Commission has clearly ariculated tht it found that BC~s e:iidence on reconsideration did not
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materially contrbute to the Commission's decision.
The Commission does not require that an intervenor's position prevail to receive fuding.
The pertinent standard set out in Idaho Code § 6 i -6 I 7 A(2 )( a) is that the intervenor "has to
materially contributed to the decision." Neither the statute nor the Commission requires the
intervenor to prevaiL. See e.g., In re Idaho Power, 2009 WL 2844075 (Idaho PUC) (although the
I01 intervenors did not prevail on all issues, they "added informed perspectives to the hearng record
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IDAHO PUBLIC UTILITIES COMMISSION 32
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. . . (and) materially contributed to the Commission's decision."); In re Rocky Mountain Power,
2009 WL 3 I 59489 (Idaho PUC) (granted parial fuding); In re Idaho Power, 2009 WL 562949
(Idaho PUC); In re Avista, 2008 WL 857075 (Idaho PUC). The Commission did not abuse its
discretion in determining that BCA did not materially contribute to the Commission's decision.
3. BCA's Positions did not Address Issues of Concern to the General Body of
Ratepayers
BCA next argued that the Commission abused its discretion in finding that BCA failed to
raise issues of concern to the general body of ratepayers. BCA Brief at 39. In its Order, the
Commission found that BCA's advocacy does not address issues of concern to the "general body
of users or consumers." Idaho Code § 61-617A(2)(d); Order No. 30955, Appendix A at 26.
BCA's costs and fees were incurred representing concerns of its members (and perhaps
indirectly new customers), but not the general body of ratepayers. Allowances, and especially
the eliminated lot refud, directly represent what offset a developer (or a new customer) will
receive when requesting electric service. Continuing the old methodology or increas!Ilgper lot
refunds does not beI)efit the general body of users or consumers.. Idaho Code § 61-617 A(2)( d).
In reaching its decision about "the general body of ratepayers" the Commission was
relying on its own knowledge of Idaho Power's customers. Industrial Customers, 134 Idaho at
293, 1 P.3d at 794. The number of BCA members, developers and even new customers
combined is de minimis when compared to "the general body of users or consumers." For
example, the total number of customers served by the Company as of December 3 I, 2009 was
489,923. The total number of new residential customers added in 2009 was 2,258.
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IDAHO PUBLIC UTILITIES COMMISSION 33
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ww.idahopower.com/AboutUs/CompanyInformation/Facts. viewed July 14, 2010. Thus, new.
customers represented less than .005 of a percent (2,258 .. 489,923 = .0046). It canot
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reasonably be argued that BCA's positions represented issues of concern to the general body of
ratepayers. Idaho Code § 61-617A(2)(d).
4. RCA's Costs were Unreasonable
lJ The Commission also denied BCA intervenor fuding on the basis of uneasonable costs.
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"Because much of BCA's advocacy addressed the line extension policies of the 1995 Rule H
case, we find much of the reconsideration legal fees and expert fees to be unreasonable." Order
No. 30955, Appendix at 26. BCA does not address or dispute this finding. BCA's evidence and
arguments on reconsideration were significantly beyond the scope of reconsideration set by the
Commission. Order No. 30955, Appendix A at 26. Thus, its expenses on issues beyond
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that the request for intervenor funding failed to meet all of the requirements of Idaho Code § 61-
617A(2)(d) and Commission Rules 161-165, IDAPA 31.01.01.161 through .165....
F. BCA is not Entided:.tö~an Award of Attoniêy .Fees on Appeal ........ .-'.":r ,
BCA requested an award of attorney fees on appeal, should it be the prevailing pary.
BCA insisted that it is entitled to recover its fees for two reasons. First, BCA maintained it is
Ij entitled to attorney fees on appeal under the "private attorney general doctrine." BCA Brief at
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41. Second, BCA argued it is entitled to fees pursuant to Idaho Code § 12-117. Id Both
assertions are without merit.
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IDAHO PUBLIC UTILITIES COMMISSION 34
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1. BeA is not Entitled to Attorney Fees on Appeal under the Private Attorney
General Doctrine
Idaho is an "American Rule" state requiring "each par to bear their own attorneys fees
absent statutory authorization or contractual right." Owner-Operator Independent Drivers Ass 'n
v. Idaho PUC, 125 Idaho 401, 407, 871 P.2d 818, 824 (1994); Heller v. Cenarrusa, 106 Idaho
571, 578, 682 P.2d 524, 53 I (1984). The private attorney general doctrne allows for an award
of attorney fees when a civil action "meets thee specific requirements: (1) great strength or
societal importance of the public policy indicated by the litigation; (2) the necessity for private
enforcement and the magnitude of the resultant burden on the plaintiff; and (3) the number of
people standing to benefit from the decision." Owner-Operator, 125 Idao at 408, 871 P.2d at
825; Heller, 106 Idaho at 578, 682 P.2d at 531.
In Kootenai Medical Center v. Bonner County Com'rs, this Court held that the private
attorney general doctrine is not available to award attorney feesagainst the State. 141 Idaho 7,
10, 105 P.3d 667, 670 (2004), citing State v. Hagerman Water Right Owners ("HWRO'j, 130
Idaho 718, 947 P.2d 391 (1997). As the Cour explained in HWRO, the private attorney general
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doctrine arses from the authority of Idaho Code § 12-121. . .." 130 Idaho at 725, 947 P.2d at
398. However, this Cour has stated that Section 12-121 "does not. . . authorize an award of
attorney fees on appeal of an agency ruling." Duncan v. State Ed of Accountancy, _ Idaho
_' _ P.3d _ slip op. at 6, 2010 WL 1632647 (April 23, 2010); Roe v. Harris, 128 Idaho
569,573,917 P.2d 403,407 (1996).
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IDAHO PUBLIC UTILITIES COMMISSION 35
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Second, even if the private attorney general doctnne applied, BCA has not satisfied the
first and third elements of the doctrine. The first element requires that the litigation be pursued
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to benefit the public, rather than to protect private pecuniar interestS. HWRO, 130 Idaho at 726,
947 P.2d at 399. In HWRO, this Cour noted that if a pary is protecting its own economic
interests, it canot claim that it is a public interest litigant. Id at 726, 947 P.2d at 399. In this
case, BCA primarly objected to reduction in the line extension allowances based upon its
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members that develop subdivisions.
Finally, the third element of the private attorney general doctrine - regarding the number
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of people standing to benefit from the decision - is not met in this case. In Owner-Operator, the
Cour found that the number of people standing to benefit was insufficient to justify an award of
attorney fees. 125 Idaho at 408, 871 P.2d at 825. In Owner-Operator, a class action suit was
brought against the Commission on behalf of "tens of thousands of motor cariers" operating in
Idaho. Plaintiffs Brief, 1993 WL 13141746 (Idaho). If the Cour found that the tens of
thousands of motor cariers was "insufcient to justify an award of ..attorneys fees," then the
number of BCAmembers surely canot meeta level that justifies an award of attorney fees on"' '
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appeaL. For these reasons, the Contractors' request for attorney fees under the pnvate attorney
general doctrne must be denied.
2. BCA is not Entitled to Attorney Fees on Appeal under Idaho Code § 12-117
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BCA also seeks attorney fees on appeal under Idaho Code § 12-117. This section
provides that in certain circumstances, the cour "shall award the prevailing party reasonable
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attorney's fees (on appeal) . . . if (the cour) finds that the nonprevailing par acted without a
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IDAHO PUBLIC UTILITIES COMMSSION 36
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reasonable basis in fact or law.,,12 Idaho Code § 12-117(1). The facts of this case and the case
I. ~law do not support such an award.
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a. Reasonable Basis in Law: As a matter ofIaw, there are two reasons BCA's request for
attorney fees on appeal must be denied. First, BCA concedes that Section 12-117 is not
1_ _J applicable to the IPUC. The Commission agrees. In a unanimous decision, this Cour
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determined in Owner-Operator that Idaho Code § 12-117 is not applicable to the Commission
because the IPUC "is a legislative agency not faIlng within the definition of a 'state agency' as
defined by i.e. § 67-5201(1)" and used in Idaho Code § 12-Il7(4)(c). 125 Idao at 408,871
P.2d at 825. The Cour relied on an earlier case, A. W. Brown v. Idaho Power Co., 121 Idaho
812, 819, 828 P .2d 841, 848 (1992), where it found that when the Commission is setting rates -
as in establishing line extension rates in this case - the Commission is acting as an agency of the
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legislative deparment of governent.
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Second, as this Court recently observed, the Legislature amended Idaho Code § 12-1 17 in
early 2010. In amending this statute, the LegisIaturedicLnotchange the definition or scope of
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"'state agency" found in Section 12-Ill( 4)(c).When the Legislatue amends a statute it ..Is~' .
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presumed that it has full knowledge of existing judicial decisions and case law. UZtrawall v.
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Washington Mut. Bank, 135 Idaho 832, 836,25 P.3d 855, 859 (2010); State v. Pina, _ Idaho
_' _ P.3d _,2010 WL 963485 (March 18,2010). When it amended Section 12-117 the
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12 Section 12-117 also allows parties to recover attorney fees, witness costs, and other expenses in administrative
proceedings "(uJnless otherwise provided by statute." In the case of the Commission's administrtive proceeding,
Idaho Code § 61 -6 1 7 A provides for the recovery of "legal fees, witness fees, and reproduction costs" under specific
conditions. Consequently, Section 12- 11 7 is not applicable to IPUC proceedings and Section 6 I -617 A is
controlling.
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IDAHO PUBLIC UTILITIES COMMSSION 37
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Legislature did not alter the statute so that it would apply to the Commission. Presumably the
Legislature did not intend to subject the IPUC to Section 12-1 17.
b. Reasonable Basis in Fact. Even if Section 12-117 were applicable, the Commission
has acted with a reasonable basis in fact. The Commission acknowledged that the line extension
allowances in this case represent a change in methodology from the 1995 case. Order No.
30955, Appendix at 21. The Cour recognizes that regulatory bodies may change methodologies
so long as the Commission can adequately explain its actions. Rosebud, 128 Idaho at 618, 917
P.2d at 781. The changes in methodology and line extension rates in the underlying case were
intended to ensure that "utility costs be paid by those that cause the utility to incur the costs."
Order No. 30955, Appendix A at 21. Ifcost-causers do not pay, then the electrc rates for other
. customers will be higher than what is just or reasonable. Id The new methodology is based on
actual costs of installng "standard terminal facilties" (i.e., transformers, distrbuting wiring, and
secondar wiring between the transformer serving the new customer and junction boxes). Id
The Commission acted reasonably when-it discontinued the "per customer" allowance
.~ . and implemented the new "per.transformer" allowance, which is more reflective of curëntcosts..:' ~.~
In other words, retaining the old methodology would lead to allowances/lot refuds that are
greater than the actual cost of terminal facilities required to provide line extensions to customers.
Id The IPUC also acted reasonably in denying intervenor fuding to BCA given the standards
set out in Idaho Code § 61-617A(2). Order No. 30955, Appendix A at 25-26. Consequently, the
Court should deny BCA recovery of attorney fees on appeaL.
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IDAHO PUBLIC UTILITIES COMMISSION 38
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CONCLUSION
As set out above, the Commission has regularly pursued its authority in approving Idaho
Power's new line extension taiff. The IPUC's findings and conclusions in Order No. 30955 that
approve the new line extension allowances and the new methodology are amply supported by
competent and substantial evidence. The denial of BCA's intervenor funding based. upon the
J strct standards of Idaho Code § 61-617 A are supported by suffcient evidence and was within
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the Commission's discretion. Attorney fees on appeal are not authorized under the private
attorney general doctrne or Idaho Code § 12-117. The Commission clearly did not abuse its
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discretion in rendering its decisions in this case.
The Commission requests that the Cour affirm Order No. 30955.
DATED at Boise, Idaho this 16th day of July 2010.
/ ~J 0.. ~.4' I\Krs~r
,.:.iiald'L. Howell, 11
Depùty Attorneys General
Attorneys for the
Idaho Public Utilities Commission
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CERTIFICATE OF SERVICE
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I HEREBY CERTIFY THAT I HAVE THIS 16TH DAY OF JULY 2010,
SERVED THE FOREGOING RESPONDENT BRIEF OF THE IDAHO PUBLIC
UTILITIES COMMISSION, IN SUPREME COURT DOCKET NO. 37293-2010, BY
MAILING TWO COPIES THEREOF, POSTAGE PREPAID, TO THE FOLLOWING:
LISA D. NORDSTROM
DONOVAN E. WALKER
IDAHO POWER COMPANY
1221 W. IDAHO STREET
PO BOX 70
BOISE, ID 83707-0070
MICHAEL C. CREAMER
MICHAEL P. LAWRNCE
GIVENS PURSLEY LLP
601 W. BANOCK STRET
PO BOX 2720
BOISE, ID 83701-2720
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APPENDIX A
ORDER NO. 30955
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Offce of the Secreta
Service Date
November 30, 2009
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR ) CASE NO. IPC-E-08-22
AUTHORITY TO MODIFY ITS RULE H )
LINE EXTENSION TARIFF RELATED TO )
NEW SERVICE ATTACHMENTS AN ) ORDER NO. 30955
DISTRIUTION LIN INSTALLATIONS. )
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On October 30, 2008, Idaho Power Company fied an Application seeking authority
to modify its line extension taff commonly referred to as the "Rule H" taff. Specifically, the
Company sought to increase the charges for instaling new servce lines and relocating existing
electric distrbution facilties. On July I, 2009, the Commission issued Order No. 30853
parially approving the Company's request to modify its Rule H taff. The Ada County
Highway Distrct (ACHD), City of Nampa, Association of Canyon County Highway Distrcts
(collectively "the Districts"), and the Building Contrctors Association ("BCA" or
"Contractors") all filed timely Petitions for Reconsideration. The Distrcts argued that the
Commission exceeded its statutory authòrity in approving the changes to Section 10 of the taff
("Relocations in Public Road Rights-of-Way"). BCA objected to changes to the line extension
rate strctue concerning "allowances" or credits for the installation of new service and the
elimination of subdivision, lot refuds. On July 29, 2009, Idaho Power filed an answer to the
petitions.
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In Order No. 30883 issued August 19, 2009, the Commission granted in par and
denied in par the petitions for reconsideration. The Commission granted reconsideration to the
Distrcts to review their legal arguents and set oral argument for October 13, 2009. The
Commission parially grated reconsideration to the Contractors and scheduled an additional
evidentiar hearng regarding the appropriate line extension allowances contaned in Rule H.
The evidentiar hearng was held on October 20, 2009. Final reconsideration briefs were fied
by BCA and Idaho Power on October 27,2009. On November 9,2009, the Contractors fied a
Petition for Intervenor Funding.
After reviewig the initial record, the reconsideration testimony and briefs, and the .
intervenor fuding petition, the Commission issues ths fial Order on reconsideration afrmg,
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ORDER NO. 30955 1
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rescinding, amending and clarfyg par of our initial Order pursuat to Idaho Code § 61-624.
The Commission's textu changes to Ru1e H ar contaried in the Appendix to ths Order.
BACKGROUN
A. The Application
Idaho Power's last request to update its Rule H tarff was in 1995. In its present
Application, Idaho Power proposed modifications to its existing Ru1e H taff that reorgane
sections, add or revise definitions, update charges and allowances, modify refud provisions, and
delete the Line Instalation Agreements section. Idaho Power proposed separate sections for
"Line Intalation Chage" and "Serice Atthment Charges." Withn the Servce Attchment
Charges section, Idaho Power separtes the overhead and undergrund service atthments,
updates the chages for underground service attchments less than 400 amps, and outines the
calcu1ation for determning the charges for underground service greater th 400 amps. The
44Vested Interest Charges" section was reworded and some definitions were removed. The
available options and calculations in this section were not changed. Engineerig charges,
temporar service attchment charges, and retur trp charges were updated in the 4'Oter
Charges" section.
The Company asserted that the Line Instalation and Service Attchment Allowances
section was modified and updated to reflect curent costs associated with providing and inling .
4'stdad terinal facilties" for single-phase and thee-phase servce and line inslations. The
Company's proposal to provide a new customer with an inlation credit or "allowance" equal
to the instaled costs of "stadad" overhead distrbution facilties (e.g., trformers, meters,
wirig) is intended to provide a fixed credit toward the cost of constrcting termina facilties
and/or line instalations for customers requesting new servce under Ru1e H. Tr. at 128. The
fixed allowance is based upon the cost of the most commonly installed facilties and attempts to
mitigate intr-class and cross-class subsidies by requiring customers who need more costly
facilties to pay a larger portion of the cost to serve them. The proposal also modifies Compay-
fuded credit allowances inside subdivisions. Idaho Power maintans that these revisions to the
tarff specifically address the Company's desire that customers pay their fair share of the cost for
providing new service lines or altering existing distrbution lines.
Idaho Power proposed to provide "Vested Interest Refuds" to developer of
subdivisions and new customers inside existig subdivisions for new service line inslations
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that were not par of the initial servce instalation in the subdivision. The Company also
proposed to change the availabilty of Vested Interest Refuds from a five-year period to a four-
year period and discontinue all refuds for subdivision lots.
Idaho Power also added a new Section 10 entitled "Relocations in Public Road
Rights-of- Way" to address the recovery of costs when the Company has to relocate its faci,lities
pursuat to Idaho Code § 62-705. Thesectioii identifies when and to what extent the Company
would be responsible for relocation costs and when it could recover costs from third-par
. beneficiares. Specifically, ths section outlines cost recovery when road improvements are for
the general public benefit, for thrd-par beneficiares, and for the benefit of both the genera
public and thrd-par beneficiares.
B. The Prior Final Order
On July i, 2009, the Commssion issued final Order No. 30853 approving the
Company's increased allowances, miscellaneous costs, language regarding highway relocations,
and the requested changes to format and definitions. The Commssion fuer approved a "cap"
of 1.5% on general overhead costs and maintaned the existing five-year period for Vested
Interest Refuds.
The Commission determned tht the updated charges and instalation allowances for
line installations represent an appropriate "contrbution" from new customers requestng the
service, thereby relieving one area of upward pressure on rates. The Commission specifically
noted that the costs of new power generation and trsmission lines canot be charged to only
new customers. The Commssion found tht when it is possible to allocte the cost of new
distrbution facilties to new cusomers, it is appropriate to charge such facilties to the customers
who use them. As a result, the Commission found the Company's proposed fixed allowances of
$1,780 for single-phase service and $3,803 for thee-phase servce represent a fair, jus and
reasonable allocation of line extension costs.
The Commission also declined to grant the Company's request to reduce the tie
limitation withn which to receive Vested Inrest Refuds from five year to four year. The
Commission reasoned that more refuds may be made in the fifth year now that building activity
has slowed. Although the Building Contractors Association requested that the refud period be
extnded to ten years, the Commission found such request was not supported by documentation
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or arguent. Therefore, the Commission determined it reasonable to maintain a five-year period
for Vested Interest Refuds.
The Commission also found that it is reasonable to discontinue refuds for
subdivision lots. Since 1995, as lots were sold the Company would reimbure a portion of the
line extension costs that developers. were required to advance to Idaho Power prior to
constrction. These reimbursements were by subdivision lots. The Commission discontinued
the subdivision lot refuds for thee reasons. First, the Commssion increased the initial
"allowance" or credit for new servce to new customers. Customers may receive a $1,780
allowance for each single-phase tranformer instled or a $3,803 allowance for each thee-phase
transformer. Order No. 30853 at 10. A transformer may serve multiple customers. Second, the
Commission reJected BCA's arguent to increase the lot refuds because its proposal included
inappropriate costs and the costs were miscalculated. Id at i 2. The Commission found the
increased allowance was properly based on the average cost of distrbution facilties (the
Stadard Terminal Facilties) for a new customer. After providing the increased allowances to a
developer, allowing any lot refuds to "the developer would exceed the distrbution investment"
for a new customer. Id Finally, discontinuig subdivision lot refuds reduces the growt of rate
base that results from such refuds.
Generally, pares requestig the relocation of utility facilties ar obligated.to pay for
the costs of the relocation. However, the State and its political subdivisions can require the
relocation of utilty facilties located in the public right-of-way puruat to their police powers.
Idaho Power proposed, and the Commission approved, Section 10 as a mechansm to determine
who is respoiisible for the cost of certn relocations in the public right-of-way. The
Commission specifically noted that Secion i 0 in no way grants Idaho Power or the Commission
authority to impose relocation costs on a public road agency. Order No. 30853 at 13. The
Commission found it persuasive that if a public road agency determines that a private thid par
should pay fora portion of a road improvement project, it is a reasonable and appropriate
indication of responsibilty for the allocation of utilty relocation costs incured as a result of the
road improvement project. Furhermore, based on concerns noted by the paries, Idao Power
was directed to clarfy and resubmit the definitions of "Local Improvement Distrct" and "Thrd-
Par Beneficiar."
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PETITIONS FOR RECONSIDERATION~ .
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A. The Districts
Ada County Highway Distrct (ACHD), City of Nampa (Nampa), and the
Association of Canyon County Highway Distrcts (ACCHD), (collectively, "the Distcts"),
allege that the Commission's approval of Section lOin Rule H exceeds the Commission's
authority grted by statute. Section i 0 addresses relocation costs in public rights-of-way.
ACHD fuer maintains that Section i 0 violates the Idaho Constitution by requing highway
agencies and other public entities to pay for the relocation of utilty facilties in public rights-of-
way. ACHD Petition at i i. Nampa and ACCHDalso argue that the Commission's Order fails
to clarfy the definitions of "Thrd-Par Beneficiar" and "Local Improvement Distct."
Petitions at 2.
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B.BCA
Building Contractors Association (BCA or Contractors) alleges in its Petition for
Reconsideration that the Commissio:q's : order "approves an inherently discriminatory rate
strctue for line extensions by imposing unequa chages on customers receiving the Same level
and conditions of service." BCA Petition for Reconsideration at 1~ BCA also disputes the
Commission's decision to discontinue "its heretofore longstding policy that new cusomers are
entitled to a Company investment in distrbution facilties equa to that made to sere existing
customers in the same class." Id at I I.
C. The Order Grantig and Denying Reconsideratin
On August i 9, 2009, the Commssion issued Order No. 30883 grting in par and
denying in par the paries' Petitions for Reconsideration. The Commssion acknowledged the
limits of its authority in Order No. 30853 by stating that "Section i 0 in no way grts Idaho
Power or this Commission authority to impose (relocation) costs on a public road agency."
Order No. 30853 at 13. The Order fuer clarified tht "OJust as the Commission canot compel
the highway agency to pay for the relocation of utility facilties in the public right-of-way made
at the agency's request, the agency caqo(réstrct the Commission from establishing reasonable
charges for utilty services and practices." Id. However, given the complexity of the
constitutional and jursdictional arguents posed by the Distrcts on reconsideration and the
Company's acknowledgement that the terms "Local Improvement Distrct" and "Thd-Pary
Beneficiar" should be clarfied, the Commission found it appropriate to grt the Distcts'
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petitions regarding the disputed languge in Section 10 of the Rule H taff. In order to
adequately address the issues raised on reconsideration, the Commission fit directed that Idaho
Power supply new languge for Section 10, including the clarfication of the definitions for
"Thrd-Par Beneficiar" and "Local Improvement Distrct." Id at 11. Idaho Power was
directed to fie its updated Section 10 languge with the Commission and the pares no later th, .
August 28, 2009.
The Petition for Reconsideration fied by BCA was granted in par and denied in par.
The Commission found it appropriate to grant reconsideration on the limited issue of the amount
of appropriate allowances. As stted in its final Order, "(tJhe Commission recognzes that
multiple forces put upward pressure on utilty rates." Order No. 30853 at 10. Allowances are
intended to reflect an appropriate amount of contribution provided by new customers requesting
services in an effort to relieve one area of upward pressure on rates. BCA was diected to
address what allowance amount is reasonable based on the cost of new distrbution facilties.
Reconsideration was denied regarding the five~year ve~ed-interest refud period and
the per-lot refuds. The Commission found that the Contractors provide no cogent argument or
docuientation on why the period should be expanded to 10 year. Having determined that the
new service allowance of $1,780 is based upon the cost of a single-phase transformer and
conductors, ("stadard terminal facilties'')that can serve multiple customers (thee or more), the
Commssion found that BCA's requested refud of $1,000 per lot for a subdivision developer
would exceed the costs of new extension facilties. Id at 11-12.
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ISSUES ON RECONSIDERATION
A. Legal Standards
Reconsideration provides an opportity for a par to bring to the Commission's
attention any question previously deterrned and thereby afords the Commission with an
opportty to rectify any miste or omission. Washington Water Power Co. v. Kootenai
Environmental Allance, 99 Idao 875, 879, 591 P.2d 122, 126 (1979). The Commission may
grant reconsideration by reviewing the existing record by wrtten briefs, or by evidentiar
hearng. IDAPA 31.01.01.311.03. Ifreconsideration is granted, the Commission mus complete
its reconsideration within 13 weeks afer the deadline for filing petitions for reconsideration.
Idaho Code § 61~626(2).i
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ORDER NO. 30955 6
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B. Motions to Strike
On September 21,2009, Idaho Power filed a motion to strke portons of the afdavit
of Dorrell Hansen submitted by ACHD in support of its motion for reconsideration. Idao
Power maintans that portions of Mr. Hansen's testimony constitute inadissible evidence
because they lack proper foundation, lack personal knowledge, lack relevance and contan
concIusory or speculative statements. On October 5,2009, ACHD fied a brief opposing Idao
Power's motion to strike. ACHD noted that the Idaho Supreme Cour has recognzed that '~e
law governng the Commission contemplates a rule of liberality in the reception of evidence."
Application of Lewiston Grain Growers, 6~ Idaho 374, 380, 207 P.2d 1028, 1032 (1949).
At oral argument on October 13, 2009, the Commission denied Idaho Power's
motion to strke portions of the affdavit of Dorrell Hanen. Rule 261 of the Idaho Public
Utilties Commssion's Ru1es of Procedure provides that
Ru1es as to the admissibilty of evidence used by the distrct cours of Idaho in
non-jur civil cases ar generaly followed, but evidence (including hearsay)
not admissible in non-jur civil cases may be admitted to deterrine facts not
reasonably susceptible of proof under the Idao Ru1es of Evidence. . .. All
other evidence may be admitted if it is a tye generally relied upon by prudent
persons in the conduct of their affairs. The Commission's expertise, technical
competence and special knowledge may be used in the evaluation of the
evidence.
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IDAPA 31.01.01.261. The Commission determned that it was capable of considerig the
information provided and, based on its exprtise, give it the proper weight.
On October 6, 2009, ACHD fied a motion to strke all or portons of the wrtten
prefied testimony of Scott Sparks, David Lowr and Greg Said fied by Idaho Power. ACHD
argued that the prefied testimony of Idaho Power's witnesses was inadissible because it failed
to comply with Rule of Procedure 250 requiring that testimony in formal hearngs be given under
oath. IDAPA 31.01.01.250. On October 8, 2009, Idaho Power fied a notice with the
Commission opposing ACHD's Motion to Strke. Idaho Power requested that argument be held
on its Motion durng the ora argument schedu1ed for October 13,2009.
At the techncal hearg conducted by the Commission on October 20, 2009, each of
ACHD's objections was considered and each was denied. The wrtten testimony of Idaho
Power's witnesses expressed the Company's positions on matters regarding the Rule H taff.
The witnesses had firsthand knowledge of the matters to which they testified. Moreover, the
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witnesses were available at both the oral arguent and techncal hearg for cross-examtion.
At the October 20, 2009, techncal hearg BCA moved to strke certn portions of
the wrtten testimony of Idaho Power witness Greg Said as hearsay. The Commssion resetved a
ruling on BCA's Motion to Strke until Mr. Said had an opportty to testify. BCA was advised
to renew its objection if Mr. Said's live testimony did not provide adequate explanation
regarding its concerns. The hearsay concerned information provided to Mr. Said from another
witness and the other witness was present at the hearng. BCA renewed its objection. The
Commission overred the objections. Tr. at 263, 261-64. BCA later declined to cross-examine
the other witness on the information that was the subject of the initial objections. Tr. at 299.
c. The Districts' Legal Arguments
The Distrcts make several legal arguents to support their position that Section 10
(Relocation Costs in Public Rights-of-Way) and several definitions in Section i (Definitions)
should be stricken from Rule H. The Distcts generlly assert that Section 10 intrdes in the
highway distrcts' exclusive jursdictiÐn1anâ is unconsttutional because it obligates highway
agencies and other local governent entities to pay for utilty relocation costs. The Distrcts also
dispute the definitions for "Third-Par Beneficiar" and "Local Improvement Distrcts".. used
in Section 1 O. The Distrcts argue that a .local improvement distct (LID) should not be
considered a "Third-Par Beneficiar." They maitan that an LID is an entity of local
governent and, as such, should not be required to reimburse a utilty for r~location costs.
These legal arguments are discussed in greater detail below.
1. Exclusive Jursdiction. The Distrcts maintan that the highway distrcts possess
exclusive jursdiction over the public 'rights-of-way. Thus, Section 10 of Rule H is beyond the
jursdictional authority of the Commission because it seeks to usur the exclusive jursdiction of
the State's public road agencies. ACHD Petition at 2. In a related argument, the Distrcts
maintain that Section lOis unconstitutional and an ilegal attempt to abrogate or amend the
common law rue that utilities placing their facilties along streets and highways gain no propert
right and must move their facilties at.heirownexpense upon demand.
Idaho Power acknowledges the common law rue that the utilty's use of the public
road right-of-way is subordinate to the paramount use of the public. Idaho Power does not
dispute or contest the public road agencies' authority to require relocation of utility facilties.
Reply Brief on Reconsideration at 3-4. However, Idao Power asserts that the public road
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j agencies do not have the authority, once. the utilty complies with the relocation request, to
determe how the utilty will seek subsequent reimbursement from third paries benefiting from
the facilties' relocation. The Company maitans that the Commission alone is vested with the
authority to determine how utilty costs should be allocated.
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Commission Findings: At the outset, we note there is agreement between the
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Distrcts and Idao Power regarding some of the underlying legal issues. More specifically, the
Distrcts and Idaho Power agree that road agenèies have exclusive jursdiction to supervise
highways and public rights-of-way. ACHD Brief at 3; Joint Brief at 2; Idaho Power Reply Brief
on Reconsideration at 3-4. As the Idao Cour of Appeals noted in Worley Highway District v.
Kootenai County, highway agencies have exclusive jursdiction over all highways including the
power to construct, maintain, and repair public highways as well as to establish design stadards
and use stadards. 104 Idaho 833,835,663 P.2d 1135, 1137 (Ct. App. 1983) citing Idaho Code
§ § 40- 13 I 0 and 40-1312. The paries also agree that Idao Power has a permssive right only to
use the public rights-of-way for its facilties and that public road agencies have the exclusive
authority to determine when relocation of utilty facilties with the public right-of-way is
necessar so as not to incommode the public. use. ACDH Brief at 5-6; Joint Brief at 2; Idao
Power Reply Brief at 4; see also Idaho Code §§ 62-701 and 62-705. As our Supreme Cour
noted in State ex rei. Rich v. Idaho Power- Co., the common law rule in Idao is that "stets and
highways belong to the public and are held by the governenta boies and political subdivisions
of the state in trst for use by the public, and that only a permissive right to use, and no
permanent propert right can be gained by (utilties) using them." 81 Idao 487, 498, 346 P.2d
596.601 (1959); Idaho Constitution, Ar. XI, § 8 ("the police power of the state shall never be
abridged or so constred as to permt corporations to conduct their business in such a maner as
to infrnge . . . the general well being of the state.").
ACHD argues that Section 10 should be removed in its entirety from Rule H. The
Distrcts maintan that as wrtten, Section 10 intrdes upon the road agencies' exclusive
jursdiction. ACHD argues tht "Rule H, Section 10 will effectively dictate the policies and
procedures of highway distrcts and local road agencies regarding electrc utilty relocations. It
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1 "(TJhe Commission has the authority to deterine the inclusion as an operatig expense in a utilty's rate base
either in par or in whole 'costs' incurred by a utlity." Washington Water Power v. Kootenai Environmental
Allance, 99 Idao 875, 880, 591 P.2d 122, 12~ (l979)~; ,
ORDER NO. 30955 9
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will impact the o.peration of highway distrcts and local road agencies in their negotiations and
relationships with third paries and developers concernng road improvement projects. . .." Tr.
at 17; ACHD Brief on Reconsideration at 7; Joint Brief at 3. ACHD also insists that Section 10
conflicts with the Distrct's Resolution No. 3302 governing utility relocations. Finally, the
Distrcts also maintan that the Commission has no authority over the relocation of utility
facilties in the public rights-of-way because such relocations are "not a servce, product or
commodity under Idaho Code §§ 61-502 and 61-503." ACDH Brief on Reconsideration at 10.
The Commission does not agree with these three arguments.
First, the Commssion afrrs:'that highway agencies have the authority to deterine
when Idaho Power must relocate its distrbution facilties and whether any other pary is
responsible for paying for the road improvement costs. However, once the highway agency
determines that a private par (e.g., a developer) must shoulder all or a porton of the road
improvement costs, then it is the Commssion that establishes the costs for utilty relocation
puruat to Idaho Code §§ 61-502, 503, and 507. Ths is the purose of Section 10. The
Commission's abilty to set relocation costs arses only afer the highway agency determines that
it or another par is responsible for road improvement costs. Likewise, when a highway agency
asks Idaho Power to relocate facilties not in'the public right-of-way (e.g., facilties in an
easement), Rule H would apply. Idaho Power Reply Brief at 6; see also Resolution 330, §
I.A.(2) (if the utilty has facilties on private propert that must be relocated, "the actul cost of
such relocation shall be the responsibilty of the Distrct").
Second, as amended below, Section 10 is compatible with and not in opposition to
Resolution No. 330. As explained byiACHD, Resolution No. 330 addresses utilty relocations
and determines which par bear the cost of reloc~tions. For example, if ACHD requires the
relocation of utilty facilties to accommodate right-of-way improvement "sponsored or fuded
by Ada County Highway Distrct," then such relocation costs "shall be the responsibilty of the
utilty." Resolution 330, Section I (A). This section follows the common law rule in Idaho that
utilties must relocate their facilties so that the highway agency may make improvements. Rich
v. Idaho Power, 81 Idaho at 501, 346 P.2d at 603.
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2 Resolution 330 is a mechanism promulgated more than 20 year ago by ACHD for the allocation of costs of road
improvements. Idaho Power patterned its Rule H, Section 10 after the language in Resolution 330.
ORDER NO. 30955 10
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As amended, Section 10(a) ofRu1e H incorporates ths concept. Sections 2 and 3 of
Resolution 330 address instaces where utilty relocations are either parially-fuded or fuly-
fuded by "another individua, firm or entity." In other words, afer ACHD has determined tht
a private purose (as opposed to a public purse) is the impetu for a specific relocation,
Resolution 330 and Rule H provide that such private par should also be responsible for
defraying the cost of relocating utilties within the public right-of-way for that project. For
example, Section 3(A)(2) of Resolution 330 provides that when utility "relocations ar required
as a resu1t of improvements being made by a developer within the public rights-of-way which
were not schedu1ed to have otherwse been made by (ACHD) withn thee years of the date sad
improvements are actuly commenced, then the responsibilty for the costs of utility . . .
relocations shall be that of the developer." (Emphases added.) Ths provision of Resolution 330
requires the developer to pay Idaho Power for the relocation of utilty facilties located withn the
public right-of-way. Thus, Rule H, Section 10 mirrors or complements Resolution 330. Clearly
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Resolution 330 contemplates circumstces where thd paries will pay Idaho Power for the cost
of relocating the Company's distrbution facilties located in the public right-of-way.
The language of Section lOin no way usurs the authority of ACHD or any other
highway distrct or political subdivision because it does not attempt to give Idao Power or this
Commission any authority that a highway distrct would otherwse hold. It is because the
allocations of Resolution 330 have worked so effectively in the past 20 years that Idaho Power
proposed it as a model for the allocation of relocation costs within its Rule H, Section 10. Tr. at
27.
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Thd, we reject ACHD's argument that the relocation of Idao Power's facilties
from the public right-of-way is not a "service or product" provided by the utilty. As indicated
above, the Distrcts recognize that there are instaces where relocation costs are assigned to
another individual, firm or entity such as a developer. In such cases, Section 10 provides the
basis for Idao Power to recover its :relocation costs from the developer. The relocation of
Company facilties is a "practice" or "servce" subject to our jursdiction. Idaho Code §§ 61 -502
and 61-503 authorize the Commission to establish the just and reasonable rate or charge "for any
servce or products or . . . the rues, regulations, practices, or contract . . . afecting such rates."
In addition, Idaho Code § 6 I -507 provides that the Commission "shall prescribe rues and
reguations for the performance of any service." (Emphases added.) Indeed, Rule H "applies to
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ORDER NO. 30955 11
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requests for electrc service under (varous schedules J that require the instalation, alteration,
relocation, removal, or attchment of Company owned distrbution facilities." See Rule H at 1.
As the Supreme Cour observed in Washington Water Power v. Kootenai
Environmental Allance, the Commissiqn,has authority over services or practices "which do or
may afect the rates chaged or the services sought or rendered which are within the
Commission's ratemakng fuctions." 99 Idaho at 881, 591 P.2d at 128. Where the Distrcts
require that a thrd par pay for the road improvement cost of Idaho Power's facilties withn a
public right-of-way or where the road agency requires Idao Power to move its facilty located in
its easements, Section 10 and the other sections of Rule H fall withn the Commission's
ratemakngfuctions. Id Even in those cases where a developer would pay only a portion of
relocation costs,. the calculation of such costs is set out in Rule H.
Four, durng oral argument ACHD noted the Legislatue's recent enactment of
Idaho Code § 40-210 supports the argument that the Distrcts have exclusive jurisdiction over
public rights-of-way. Tr. at 8-9. Whle we do not dispute tht the Distcts have exclusive
jursdiction, we find enactment of Section 40-210 is the Legislatue's attempt to condition the
common law rule that utilties must relocate their facilties in the public right-of-way at their own
expense. Mountain States Tel. & Tel. CO.v. Boise Redevelopment Agency, 101 Idao 30, 34, 607
P.2d 1084, 1088. Enactment of Section 40-210 earlier ths year represents the Legislatue's
intent to contan or limit the cost of relocating utilty facilties where possible. In pertinent par,
Section 40-210 provides that
it is the intent of the legislatue that the public highway agencies and utilities
engage in proactive, cooperative coordination of highway projects though a
process that will attempt to effectively minimize costs, limit the disruption of
utilty services, and limit or reduce the need for present or futue relocation of
such utility facilties.
. . . the public highway agency shall, upon giving wrtten notice of not less
than thrt (30) days to the afected utility, meet with the utilty for the
purose of allowing the utility to review plans, understand the goals,
objectives and fuding sources for the proposed project, provide and discuss
recommendations to the public highway agency that would reasonably
eliminate. or minimize utilty relocation costs, limit the .disruption of utilty
servce, elimnate or reduce the need for present or futu utilty facility
relocation, and provide reaonable schedules to enable coordination of the
highway project constrction 'ànd such utilty facilty relocdtion as may be
necessar. While recognng the essential goals and objectives of the public
ORDER NO. 30955 12
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1 highway agency in proceeding with and completing a project, the pares shall
use their best efforts to find ways to (a) eliminate the cost to the utilty of
relocation of the utilty facilties, or (b if the elimination of such cost is not
feasible, minimize the relocation cost to the maximum extent reasonably
possible.
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Idaho Code § 40-210(1-2), 2009 Sess. Laws, ch. 142, § 1 (emphais added). Here it is clear that
the Legislatue intends for public road agencies and utilties to eliminate or minimize relocation
costs "to the maximum extent reasonably possible." Thus, we fid that the enactment of ths
statute reflects the Legislatue's clear intent that public highway agencies and utilties have an
affrmative duty to eliminate the costs ófutilty relocations, or if elimination of such costs are not
feasible, minimize the relocation costs "to the maximum extent reasonably possible."
Given the enactment of Idaho Code § 40-210, we find it appropriate to amend Rule
H by adding another section. New Section 11 (set out in the Appendix to this Order), requires
that Idaho Power paricipate in project design or development meetings once it has received
wrtten notice from the public road agency. By paricipating in the project design or
development meetings, we believe that Idaho Power will be in a better position to eliminate or
minimize relocation costs to the maximum extent reasonably possible.
Finally, it is a stadard practice for a utilty to charge for relocating its facilties.
Ths practice is consistent with the fudaenta ratemaking principle of "cost causation" -that,
to the extent practicable, utilty costs should be paid by those entities that cause the utilty to
incur the costs. If this principle were not followed, additional costs incured at the request of
both public and private entities would be shifted to all other ratepayers. This would not result in
a "just and reasonable" rate as requid by sttute. Idaho Code § 61-502, 61-503, 61-507. In
summar, we find Section 10 as amended in the Appendix to be fair, just and reasonable.
2. Local Improvement Distrct (LID) and Definition of "Third-Pary Beneficiar."
The next issue has two interrlated par. First, the Distrcts object to including LIDs in the
definition of ''thid-pary beneficiar" in Section 1 and Section 1 0 of Rule H. Nampa and the
Canyon County Distrcts argue that the definition of ''tird-pary beneficiar" is too broad and
that LIDs should not be subject to the payment of utilty relocation costs as a third-par
beneficiar under Section 1 O( c). Joint Brief at 5-6. ACHD argues that including LIDs "in the
definition of third par beneficiar . . . is a clear violation of Aricle 8 § 4 of the Idao
Constitution because it establishes a requirement upon such entities of local governent to pay
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1)for utility relocations." ACHD Brief on Reconsideration at 17. Second, because an LID is an
"entity of local governent," LIDs (like road agencies) should not be charged for the relocation
of utility facilties when LID's request that such facilties be relocated for a public purose.
Idaho Power urges the Commission to include LIDs in the defition of "third-pary
beneficiar" and allow Idaho Power to collect relocation costs from LIDs. Brief on
Reconsideration at 9-10. Idaho Power argues that:
First, a LID is not a public road agency that is charged with operatig and
maintaning public roads. An LID is simply a vehicle by which taation ca
occur but not be included in the genera budget of a public road agency. The
only fuction the LID performs is to collect money. Where the local
improvement distrct is paying for the road improvements in question, the
local improvement distrct should also pay for the costs of relocating the
power lines as required for the improvements. The local improvement distrct
tyically derives fuding from adjacent private businesses and landowners
and those paries, who are directly benefittng from the power line relocation,
should bear the costs of the relocation rather than the utilty's customers as a
whole. Idaho Power does not believe it is uneasonable to expect a LID to
include an amount to cover the cost of utilty facilty relocation in the amount
of money it will fud.
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Idaho Power Brief on Reconsideration at 9-10; seé also Tr. 28-30. Based on problems the
Company has experienced with collecting relocation costs for LIDs in the pas, the Company
maintans that it would be very easy for LIDs to include the cost of utilty relocations in their
initial fuding. Id at 10.
Commission Findings: The Commission first taes up the issue of whether LIDs
should be held responsible for utility relocation costs. Pursuat to the Local Improvement
Distrct Code (Idaho Code §§ 50-1701 et seq.), Idaho cities, counties and highway distrcts are
vested with the power to create LIDs. Idaho Code §§ 50-1702(a) and 50-1 703(a). An LID may
be formed to make one or more of the followig public improvements: To layout or widen any
street, sidewalk, alley or off-street parkig;' to pave or resurace curbs, gutters, sidewalks; to
constrct, repair or maintan sidewalks, crosswalks, santar sewers and storm sewers; to
constrt or repair street lightig; to plant or instal landscaping; to acquire and constrct parks
or other recreational facilties and "to do all such other work and to incur any such costs and
expenses as may be necessar or appropriate to complete any such improvements. . . ." Idaho
Code § 50-1703(a)(13), (1-12).
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Idaho Power urges us to include LIDs with the definition of third-par beneficiar
so that Idaho Power can seek reimbursement for its relocation costs when an LID needs to have
utilty facilties relocated to accommodate'the LID improvements. Tr. at 28-29. Because LIDs
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are merely a fuding mechanism, the. Company insists that an LID should pay for the relocation
of utilty facilties in the public rights-of-way. Id. at 28-30. Idaho Power also argues that an LID
is not a public road agency. "It is not charged with operating and maitaning public roads and it
does not control the public rights-of-way." ¡d. at 28.
Although the Commission believes that it is reasonable to expect that an LID would
include the cost of necessar utility facilty relocations as par of the tota fuding amount of the
distrct improvement, and that an LID may reimburse the utilty for the cost of relocating its
facilties within the public right-of-way (Idaho Code § 50-1703(12 and 13), we are not pesuaded
that the Commission can compel such reimbursement. As indicated above, cities, counties and
highway distrcts (the same entities that control public rights-of-way) may create a local
improvement distrct to make the public improvements authorized by law. Idaho Code §§ 50-
1702(a), (c); 50-1707.
In Vilage of Lapwai v. Al/gier,: 78 Idao 124, 130, 299 P.2d 475, 479 (1956), our
Supreme Cour held that the "power of the state and its political subdivisions to require removal
of a nuisance or obstruction, which in any way intederes with the public use of streets and
highways canot be questioned." (Emphasis added). Lapwai passed an ordinance requiring that
a private water company remove its facilty from the streets and alleys of Lapwai so the vilage
could constrct and instal its own water system. The Cour noted that the city exercised the
police power conferred by the state and was peorming a governenta fuction. Id. at 128, 299
P.2d at 477-78.3 In Lapwai, the relocation was not for the purose of makng a roadway
improvement but was the exercise of the police power for another governenta purose - the
instalation of a municipal water system.
In a more recent case, our Supreme Cour reafrmed that the common law rule, i.e.,
utilties must relocate their facilties in the public right-of-way at their own expense, is not
absolute but is subject to legislative or constitutional conditions. In Mountain States Tel. & Tel.
3 The Court did note that the bured water pipes did not interfere with the use of the streets and alleys.
Consequently, the Court modified the city's order to remove the pipes by allowing the water company to decide
whether to remove them or not at its option. Id at 130,299 P.2d at 479.
ORDER NO. 30955 15
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Co. v. Boise Redevelopment Agency, 101 Idaho 30, 607 P.2d 1084 (1980), the Cour was
confonted with the question of whether the Legislatue had modified the common rule by
providing that the redevelopment agency must pay for the costs of relocating utilty facilties in
the public right-of-way. The Cour concluded that although the urban renewal statute ''permitted
payment of such costs, they do not appear to be mandatory. In the absence of clear legislative
direction we decline to abolish the common law rule and establish a rule requirig relocation
costs to be paid to permissive users such as the utilties." Id at 35-36, 607 P.2d at 1088-89.
Idaho Power has not provided us with any au thority that the Legislatue ha modified the
common law that would requie LIDs formed by cities, counties or highway distcts to
reimburse utilties for relocating facilties in public rights-of-way.
Our decision regarding LIDs and urban renewal distrcts is fuer supported by an
opinion issued last week by the Cour in Urban Renewal Agency of the City of Rexburg v. Hart,
No. 77 (Nov. 25, 2009). In Rexburg, the Cour affrmed an earlier ruing that an urban renewal
agency is not the "alter ~go" of the local muncipality that created the renewal agency even if the
city council appoints "itself to be the board of commissioners" of the urban renewal agency. . .
." Id, slip op. at 5 aff'g Boise Redevelopment Agency v. Yiek Kong, 94 Idao 876,499 P.2d
575 (1972). The Cour fuer observed in Rexburg that a renewal agency is "entirely separate
and distinct from the municipalitY' and the renewal agency acts "as an ar of state governent.
. . to achieve, perform and accomplish the public puoses prescribed and provided" in the Urban
Renewal Law. Id, slip op. at 5 (itaicize onginal and underline added). Thus, the renewal
agency exercises the stte's police power to achieve the public improvements authorid by
sttute.
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Although we believe it is reasonable for an LID to include the necessar cost of
relocating utilty facilties, we decline to include in Section 10 a provision requirig LIDS to pay
for the relocation of such facilties. The Commission has no power to legislate a change in ths
area and require LIDs to pay utilty relocation costs in the public nghts-of-way. We fuer
observe that Rule H has not specifically addressed this issue in the past. We order the Company
to modify Section 10 to remove any requirement that LIDs be required to pay relocation costs for
utilty facilities located in the public rights-of-way as set out in the Appendix. While it appes
I that LIDs (and urban renewal distcts) may and reasonably should pay for utility relocation costsJ
that are par of the project, we canot compel the payment of such costs.
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Our LID decision also necessitates changes to the definition of "Thrd-Par
Beneficiar" in Section I as set out in the Appendix to this Order. Idaho Power shall delete the
term "Local Improvement Distrcts" from the term "Third-Par Beneficiar." In addition, we
direct the Company to change the term of "Thrd-Par Beneficiar" to "Private Beneficiar" to
conform with our decision above.4
3. Private Occupancy. ACHD next taes issue with Section 10(d). Ths subsection
states:
d. Private Right of Occupancy - Notwthstding other provisions of ths
Section 10, where the Company has a private right of occupancy for its power
line facilties withn the public road right-of-way, such as an easement or
other private right, the cost of Relocation is borne by the Public Road Agency.
ACHD argues that ths provision imposes a duty upon road agencies to pay for utility relocation
costs within the public right-of-way. ACHD also argues that ths provision violates varous
provisions of the Idao Constitution "because it establishes a requirement upon (governenta
road agencies) to pay for utility relocations.,,5 ACHD Brief on Reconsideration at 11, 17.
Nampa and the Canyon County Distrcts also argue that ths section infnges on public road
agencies' abilty to negotiate utility relocation costs on a case-by-case basis with utilties and
developers. Joint Brief at 3.
On reconsideration, Idaho Power witness David Lowr explained that a "prior right
of occupancy" may arse when a public road agency expands the public right-of-way to include
or encompass an area where Idao Power has facilties under a prior private easement. Lowr
Direct at 5.
Commision Findings: At the outset, we note that the text of this subsection is
somewhat confsing because it indicates that the Company has a private right of occupancy
within a public right-of-way. Howevet, the Company explained in its Brief on Reconsideration
that ths "prior right of occupancy" may arse when a road agency "expands its public right-of-
4 Although ACHD taes issue with the definitions of "Public Road Agency" and "Local Improvement Distct" in
Section i of Rule H it fails to provide any specific argument on the alleged error committed by the Commission in
adopting these definitions. Neverteless, the Commission believes that amending the defiition of Public Road
Agency and Local Improvement Distrct wil clarfy the scope of Rule H and in parcular the operation of Section
i O. Our changes to these two defmitions are reflected in the Appendix to this Order.
S Article VIII, § 2 and Article VII, § i 7 for the Idao Trasporttion Deparent and Article VII, § 4 for local road
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ORDER NO. 30955 17
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way to include land where utility facilties are located on a private easement." Idaho Power
Reply Brief on Reconsideration at 15. In previous instaces, to accommodate ACHD, Idaho
Power and ACHD have entered into 'Ytten ageements that provide that a subsequent rel9cation
of distrbution facilties withn certn designated areas where a private right of occupancy
existed will be borne by the road agency. This allows the utility to look to the road agency for
futue relocation costs as an alternative to compensation for expanding across the utilty's private
easement. As Idao Power explained, expanding the public right-of-way to encompass the
Company's private easement without compensation ''would constitute an unawf tang under
both Aricle 1 § 14 of the Idao Constitution and the Fift Amendment of the United States
Constitution. "
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Ths provision of Resolution 330 provides that
If a utilty. . . has facilties located on private property, with a right of
occupancy other than its right to locate in a public right-of-way, and the
Distrct requires that any facilty so located be relocated, the actu costs for
such relocation shall be the responsibilty of the Distrct. Such costs shall be
exclusive of profit allowances. . , .
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to Section 1 of Rule H. The first added definition is "Easement" (which means the Company's
legal right to use the real propert of another for the purose of instllng or locating electrc
facilties). Second, we add a definition for "Prior Right of Occupancy." Adding these
definitions and amending Subsection d. of Section 10 will improve clarty a nd allow road
agencies the flexibilty of negotiating relocation costs on a case-by-case basis. It also reflects the
current practice of the Company and road agencies such as ACHD.
4. Advance Payment of Relocation Costs. The Distrcts tae exception to ~anguage
in Section i 0 that requires Idao Power to be paid in advance by thrd pares for Idaho Power's
relocation work in public rights-of-way. More specifically, the disputed language provides: "All
payments frm Thrd-Par Beneficiar to the Company under ths Section (lOJ shall be paid in
advance of the Company's relocation work, based on the Company's Work Order Cost."
(Emphasis added.) The Distrcts assert that ths provision is an attempt "to regulate how quickly
a public utilty is required to" relocate its distrbution facilties. ACHD Reconsideration Brief at
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12; see also Tr. at 57. ACHD insists tht requiring all relocations in the public right-of-way to
be paid in advance will unduly interfere with the project's timetable. Tr. at 57.
For its par, Idaho Power expresses serious concerns about receivig reimbursement
for its relocation costs on a project that it did not initiate. Tr. at 32. The Company assert that it
loses its leverage to recover relocation costs from thrd paries afer the Company has already
relocated its facilties. Id Under Rule H, the Company is generaly paid in advance of sting
construction, uness mutuly agreed otherWse. Rule H, § 2(1).
Coltsion Findings: We agee with the Distrcts that requiring advance payments
may hider the timely completion of improvements and relocations withn the public rights-of-
way. While we appreciate the fact that advance payments elimate or reduce the risk of non-
payment to Idao Power for recovering relocation costs, we find that the Compay has other
alternatives. First, pursuant to Idaho Code § 40-210, Idaho Power is permtted to parcipate in
the project development meeting of the highway agency. Instead of simply responding to the
highway agency's direction to relocate its facilties, Section 40-210 provides utilties with an
opportity to paricipate in the plamng process for the purose of eliminating or minimizing
their relocation costs.
Second, Idaho Power has other recoures to recover its relocation costs. For
example, it may termate servce to a developer if the developer refues to pay. Utilty
Customer Rule 302 provides that a utilty may terminate service to a small commercial cusomer
for failure to pay past due amounts. The Company also has other collection and legal remedies
at its disposaL. Consequently, we order the Company to amend this provision of Section 10 to
read "All payments from Private Beneficiares to the Company under ths section shall be baed
upon the Company's work order costs." This change is shown in the Appendix.
5. Section 10 "Savings Clause." At oral arguent, ACHD also took issue with the
"Savings Clause" contaed in Section i O. Ths par of Section i 0 sttes that:
This Section (10) shall not apply to utilty relocations withn public road
rights-of-way of Public Road Agencies which have adopted legally binding
guidelines for the allocation of utiity relocation costs between the utilty and
Third-Pary Beneficiares that are substatially similar to the rues set out in
Section i 0 of Rule H.
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ACHD argued that ths is another instace where Section 10 intrdes on the road agencies to
adopt "legally binding gudelines tht (are) substatially similar to (Section 10) or else they're
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null and void." Tr. at 58. In other words, "ths provision of Rule H, Section 10 states that if our
legally binding guidelines are not similar then they're invalid." Tr. at 61.
Idaho Power noted that Section 10 was modeled on ACHD's Resolution No. 330
which was adopted by the Distrct in 1986. Tr. at 27. The Company noted that Resolution 330
has worked well for more than 20 year and that is one reason why Idaho Power modeled
Section 10 on Resolution 330. The . Company maintaned that if a road agency had adopted
utilty relocation guidelines that were "substantially similar, (then) Section 10 wouldn't tae
precedent over" the adopted gudelines. Tr. at 34.
Commision Findings: We find that the "Savings Clause" of Section 10 does not
operate to invalidate or void a road agency's legally enacted gudelines for the allocation of
utilty relocation costs. By its terms qtiotèd above, Section lOis not applicable if a road agency
has adopted similar policies addressing the allocation.ofutilty relocation costs.
D. BCA 's Issues
The Building Contractors Association (BCA) first argues that Rule H as recently
approved by the Commission is inconsistent with the methodology established in the l~t Rule H
case revision completed in 1997. Order No. 26780 (Case No. IPC-E-95-18). BCA assert the
former line extension charges were calculated on a level of investent equa to tht made to
serve existing customers in the same class. Second, BCA argues that the Company's proposed
allowances treat new and existing cúsomers differently by allocating the additional cost of
facilties to new customers. Finally, BCA alleges that infation, not growt, is the actu source
of increased costs to extend new distbution plant.
Idaho Power explains that the Line Installation and Service Attchment Allowances
section of Rule H was modified and updated to reflect curent costs associated with providing
and instaling "stadard termnal facilities" for single-phase and thee-phase servce and line
installations. The fixed allowance is based upon the cost of the most commonly instaled
facilties and attempts to mitigate intr-class and cross-class subsidies by requiring customers
with greater facilties requirements to pay a larger portion of the cost to serve them. Idaho Power
contends that there are two principal drvers that effect growth in rates over time - infation and
growth-related costs. The Company maintains that the growt in rates over the past five years
has outpaced pure inflation, demonstrting that growt is not paying for itself. Post-hearng brief
at 2. If the "cost-causers" do not pay, then electrc rates for other utilty customers will be
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higher. Ths result would not reflect a just and reasonable rate.as required by Idaho Code § 61-
503.
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Commision Findings: The Contractors fist assert that our recently approved
changes to Rule H are inconsistent with the methodology that the Commission adopted in the
1995 Rule H case. BCA implied that the Commission canot change its methodology from the
1995 cas. We reject ths argument. As our Supreme Cour noted, "Because regulatory bodies
perform legislative as well as judicial fuctions in their proceedings, they are not so rigorously
bound by the doctre of stare decisis that they must decide all futue cases in the saie way as
they have decided similar cases in the past." Rosebud Enterprises v. Idaho PUC, 128 Idaho 609,
618,917 P.2d 766, 775 (1996) citing Intermountain Gas Co. v. Idaho PUC, 97 Idaho 113, 119,
540P.2d 775, 781 (1975). "So long as the Commssion enters suffcient findings to show that its
action is not arbitrar and capricious, the Commission can alter its decisions. " Washington
Water Power v. Idaho PUC, 101 Idao 567, 579, 617 P.2d 1242, 1254 (1980).
In the present Rule H proceeding, the Commission is addressing a fudamenta
principle of utilty regulation: To the extent practicable, utility costs should be paid by those that
cause the utilty to incur the costs. If the "cost-causers" do not pay, the electrc rates for other
customers will be higher. Different circumstaces exist now than did in 1995.
Line extension charges offset the cost of physically connecting the new customer to
Idao Power's system. We affirm ourjofdei-' No. 30853 and find that the amount of $1,780 is
)based on the curent instalation cost of stadard terminal facilties for single-phase servce to
new residential customers. Order No. 30853 at 10; Tr. at 140-41, 267. Stadard terinal
facilties include a single-phase transformer and the cost of the wing between the Company's
existing distrbution facilties and the new customer's terminal facilties (the transformer), and
any seconda wiring between the trsformer and junction boxes. Tr. at 267. Depending upon
the geographic confguation of customer locations, transformers can serve multiple customers.
Tr. at 237. Because the allowance is calculated on a per transformer basis and not a per customer
basis, the allowance inside and outside subdivisions provides the same Company investment.
Permitting a per customer allowance rather than a per transformer allowance could lead to an
allowance inside subdivisions tht is greater than the cost of the terminal facilties required to
provide service. Order No. 30853 at 12; Tr. at 276-77.
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At the reconsideration hearng, BCA's witness Dr. Richard Slaughter argued tht the
line extension allowance or lot refud should be equa to $1,232 per lot (single residential
customer). Tr. at 234. As Company witness Greg Said explained,
Dr. Slaughter's recommended mechansm treats developers of residential
subdivisions more favorably than individual customers seeking connections
outside of subdivisions. (His per ,lot mechansm) tends to provide allowances
in subdivisions that exceed, the cost of stadar terminal facilties with the
excess allowances offsettng the cost of primar conductor and secondar
conductor. Such treatment is inconsistent with the treatment of residential
cusomers outside of subdivisions who do not receive an allowance greater
than the cost of stadard terminal facilties.
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Tr. at 270. Mr. Said also explained that Dr. Slaughter's $1,232 cost per lot refud proposal
inappropriately includes costs from substations, meters and service conductors which are not par
of line extension costs. Tr. at 277, 274-76. On reconsideration, we rea our previous
decision that allowances should be based upon the cost of stdard termina facilties and not on
a per lot basis. Allowances of$1,780 (or single-phase service and $3,803 for thee-phase serice
ensure that customers are treated and charged equitably based on stadard overhead service
costs, thereby mitigating intra-class and cross-class subsidies. Consequently, the Commission
finds that Idaho Power's proposed fixed allowance of$1,780 for single-phase service and $3,803
for three-phase service represents a fair, just and reasonable allocation of line extension costs.
Finally, the Contractors argue that the Rule H revision makes a new customer pay
greater upfront line extension charges to defray "some of the costs tht would otherwse be
charged to existing ratepayers for new generation and transmission," thus rung afoul of Idaho
State Homebuilders v. Washington Water Power, 107 Idaho 415, 690 P.2d 350 (1984). We
reject ths contention. In Homebuilders, our Supreme Cour determined that the Commission
could not impose a charge on only new customers to recover the costs of additional generating
resources that served all or "existng" customers. Here, the Commssion is addressing
distrbution costs not resource costs. We are setting line extension chages based on the costs of
standard terminal facilties that will be used to serve only the customer who is charged.
More importantly, the Supreme Cour noted that there is no discrimination between
"new" customers and "old" customers when the Commission sets new line extension charges.
Homebuilders, 107 Idaho at 421, 690 P.2d at 356. More specifically, the Cour noted that no
discrimination is present ''when a non-recurng charge (e.g., a line extension charge) is imposed
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upon a new customer because the service they require demands an extension of exiating
distrbution or communication lines and a charge is imposed to offset the utility's capita
investment (in servg new customers)." Id
Idaho Power's line extension charges are imposed only on those customers who will
be sered by the new facilties. The new facilties will provide service only to those cusomers
who pay for them. The line extension allowances and charges are based upon the cost of
termina facilties. 'Once new customers pay the nonrecurg charge/lne extension cost, they
become existing customers and pay puruant to the same rate schedule as all other existing
customers in their class. As such, there is no distinction between new and existing customers in
regard to nonrecurng rates and no rate discrimination. Idaho Code § 61-315.
INTERVENOR FUNDING
A. The Application for Funding
On November 9, 2009, Building Contractors fied an Application for Intervenor
Fundig in this case puruat to Idaho Code § 61 -617 A and the Commssion's Rules of
Procedure, IDAPA 31.01.01.161-165. In its Petition, BCA claimed the following fees and costs:Legal Fees Hour Tota
Michael Creamer, Parer 152.0 $38,000.00Elizabeth Donick, Associate 5.5 $ 852.50Justin Fredin, Associate 3.0 $ 585.00Tami Krger, Paregal -2 $ 580.00Total Legal Fees: 166.3 $40,017.50
Costs: Copies $ 1,021.09
$41,038.59
$19.926,66
$60,965.25
Total Work and Costs:
Consultant: Richard Slaughter 113.12
Total Fees and Expenses:
BCA maintans that it was actively involved in evaluating Idao Power's proposed
changes to its Rule H line extension taff and the economic impacts these changes would have
on BCA members and the genera public. The Contrctors contend tht the factu and policy
issues rased by this case were cqmplex and importt. BCA alleges that it consistently sought
findings and conclusions thoughout the proceedings that new customers were entitled to a level
ORDER NO. 30955 23
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î of per-customer Company investent ;in distrbution facilties on par with existing customers.
Petition for Intervenor Funding at 2.
BCA states that it retaned Dr. Richard Slaughter as a consultat and expert witness
based on his familarty with Idaho Power's rate stctue and, specifically, its line extension
taff. BCA maintains that Dr. Slaughter's testmony provided a historical and factul foundation
regarding Idaho Power's existing Rule H taff its embedded distrbuton costs, and the sources
of increasing costs of service to the Company. Dr. Slaughter argued that it was inflation, not
cusomer growt, causing upward pressure on rates. Id at 3.
BCA argues that the Commission's Order No. 30883 granting, in par, its request for
reconsideration implicitly, if not explicitly, recognizes that BCA identifed importt issues that
waranted fuer consideration. Consequently, BCA maintans that they materially contrbuted
to the proceedings. Id at 4.
BCA next alleges that the costs and expenses incured from paricipation in ths case
were all reasonable and necessar. It also contends that, as a non-profit association that relies on
volunta membership and volunta contrbutions, the costs and expenses have been a
significant financial burden. BCA claims that volunta contributions have dropped signficantly
due to the strggling economy and the depressed local real estate sector. As a result, BCA states
that it has imposed significant budget cuts and mandatory days off for its sta. Id at 5.
BCA maintans that its expenses were incured to advance policies that benefit not
only BCA members, but also the public at large. BCA points out that its position differed frm
that of any other pary, including Staf. BCA asserts that it materially contrbuted to the decision
in this case "and to the public debate about issues of population growt and energy costs and the
appropriate allocation of those costs as between new customers and the Company's existing
ratepayers." Id. at 6.
Idaho Power did not fie a response to BCA' s request for intervenor fuding.
B. Standards/or Intervenor Funding
Idaho Code § 61-617A and: Rules; 161-165 of the Commission's Rules of Proedure
provide the legal stadads for awarding intervenor fuding. Section 6 I -617 A( I) declars that it
is "policy of ths state to encourge parcipation at all stages of all proceedings before the
commssion so that all afected customers receive full and fair representation in those
proceedings." Accordigly, the Commssion may order any regulated utilty with intraste
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ORDER NO. 30955 24
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J anual revenues exceeding $3,500,000 to pay all or a portion of one or more pares' legal fees,
witness fees, and reproduction cost not to exceed a combined amount of $40,000. Idaho Code §
61-6l7A(2). The Commission's determination of whether to award intervenor fees and costs in
a paricular proceeding shall be based on the following stdards:
1. Did the intervenor materially contrbute to the decision rendered by the
Commission;
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2. Whether the alleged costs of intervention are reasonable in amount and
would be a significant financial hardship for the intervenor to incur;
3. Did the recommendation(s) made by the intervenor differ materially from
the testimony and exhbits of the Commission Sta; and
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concern to the genera body of users or consumers.
Idaho Code § 61-617A(2)(a-d).
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Rule 162 of the Commission's Rules of Procedure provides the procedural
requirements with which an application for intervenor fuding must comply. The application
must conta: (1) an itemized list of expenses broken down into categories; (2) a sttement of
the intervenor's proposed finding or recommendation; (3) a statement showig that the costs the
intervenor wishes to recover are reasonabl~; (4) a sttement explainig why the costs constitute a
significant financial hardship for the intervenor; (5) a statement showing how the intervenor's
proposed finding or recommendation differed materially from the testimony and exhbits of the
Commission Sta; (6) a statement showing how the intervenor's recommendation or position
addressed issues of concern to the general body of utilty users or customers; and (7) a statement
showing the class of customer on whose behalf the intervenor appeared. IDAP A 31.01.01.162.
Commission Findings: At the outset, BCA's request for intervenor fuding regarding
its actions for the entirety of these proceedings must be addressed. In Order No. 30896 the
Commission denied a request made by BCA for intervenor fuding based on its failur to
comply with procedural requirements. BCA fied its request nearly two months afer the 14-daY
deadline established by Commission rules. Therefore, $28,386.35 of the $60,965.25 presently
requested by BCA has already been denied by ths Commission.
BCA's request for expenses incured durng the reconsideration phase of ths case in
the amount of $32,578.90 was tiely filed~ Next, Idaho Code § 61-617A(2) and Rule 165 of the
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Commission's Ru1es require that the Commssion find that: (a) BCA's involvement in this case
must have materially contrbuted to the Commission's final decision; (b) the costs of intervention
awarded are reasonable in amount; (c) the costs of intervention are a signficant hardship for
BCA 6; (d) the recommendations of BCA differed materially from the testimony and exhbits of
Commission Staff, and; (e) BCA addressed issues of concern to the general body of ratepayers.
1. Material Contrbution. The. Commission finds that BCA' s arguments did not
materially contrbute to our final decision in ths case. BCA, in large par, recycled its arguents
and reasoning from Idaho Power's 1995 Ru1e H filing. Indeed, clarfication was repeatedly
necessar durng the techncal hearg as to which case BCA was referencing - 1995 or the
present Application. Tr. at 176, 258-59, 296. The argument BCA presented regarding new and
existing customers was similar to the argument it presented in the 1995 prior case. As in the
1995 Ru1e H case, the Commission was not persuaded by BCA's arguents. Accordingly, the
Commission canot find that BCA' s actions materially contrbuted to our final decision in this
case.
2. General Body of Users and Reasonable Costs. Because much of BCA's advocacy
addressed the line extension policies of the 1995 Rule H case, we find much of the
reconsideration legal fees and expert fees to be uneasonable. BCA was permitted to present
evidence on the "limited issue of the amount of the appropriate allowance." Order No. 30883 at
4. "BCA may address what allowance amount is reasonable based on the cost of new
distrbution facilties." Id Here BCA spent considerable resources addressing issues other th
the appropriate allowance amount. Idaho Code § 6 i -6 i 7 A(2)(b). Moreover, BCA advocacy
does not address issues of concern to "the general body of users or consumers." Id at (2)( d).
We conclude that the request for intervenor fuding of BCA fails to meet the
requirements of Idaho Code § 61-617A and Commission Ru1e 165. Therefore, BCA's request
for intervenor fuding in this case is denied in its entirety.
ULTIMATE FINDINGS OF FACT
Idaho Power is a public utilty pursuat to Idaho Code §§ 61-119 and 61-129. The
Commission has jursdiction over this matter pursuat to Title 61 of the Idao Code. The
6 We find that the cost represent a hardship for BCA and that BCA's positions materially differed from the Staffs
positions./
ORDER NO. 30955 26
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Commssion amends Idaho Power's Rule H taff as explained above and as set out in the
Appendix.
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ORDER
IT is HEREBY ORDERED that the Petitions for Reconsideration field by ACHD,
the City of Nampa, and the Association of Canyon Highway Distrcts is parially grated and
parially denied. As set out above, the Commssion's prior Order No. 30853 is amended and
clarfied pursuat to Idaho Code § 61-124.
IT IS FURTHR ORDERED that the Building Contrctors Association's request to
amend Rule H and Order No. 30853 is denied.
IT is FURTHER ORDERED that the Building Contractors Association's Petition for
Intervenor Funding is denied.
IT is FURTHER ORDERED that Idao Power shall fie new Rule H taff sheets
consistent with this Order. The changes set out in ths Order and the rest of Rule H shall become
effective for serices rendered on or after December 1,2009.
IT is FURTHER ORDERED that Idao Power shall submit to the Commssion, no
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later than Januar i of each year, updated allowance amounts for single- and thee-phase servce
to reflect curent costs for "stadard" terminal facilties.
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THIS IS A FINAL ORDER ON RECONSIDERA nON. Any par aggrieved by
this Order or other final or interlocutory Orders previously issued in this Case No. IPC-E-08-22
may appeal to the Supreme Cour of Idao puruat to the Public Utilties Law and the Idaho
Appellate Rules. See Idaho Code § 61-627.
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ORDER NO. 30955 27
DONE by Order of the Idao Public Utilties Commission at Boise, Idao ths 30 t.
day of November 2009.
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Q:IPC-E-08-22 Jcs _db_Recnsideration
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ORDER NO. 30955
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MARSHA H. SMITH, COMMISSIONER
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