20070813notice_of_application_order_no_30405.pdf

Office of the Secretary
Service Date
August 13 2007
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ALGOMA WATER
COMPANY'S APPLICATION FOR CASE NO. AWS-07-
APPROVAL TO SELL THE WATER
COMPANY AND FOR AN ORDER NOTICE OF APPLICATION
AUTHORIZING INCREASES IN THE
COMPANY'S RATES AND CHARGES FOR NOTICE OF
WATER SERVICE INTERVENTION DEADLINE
ORDER NO. 30405
On July 18 2007, Algoma Water Company filed an Application seeking Commission
approval to sell the Company (and transfer its Certificate of Public Convenience and Necessity
No. 396) to Mr. Robert J. Carrier. In addition to the sale of the Company, Algoma requests a
significant increase in its monthly flat rates for water service.
Algoma is a small water company serving about 30 customers near Sandpoint, Idaho.
The Company offers unmetered, flat-rated montWy service. In October 2006, the Commission
issued Order No. 30155 authorizing the current owner, Mr. Paul Greenwood, to purchase the
water company. Order No. 30155 also noted that Mr. Greenwood owns three sewer systems in
Bonner County, Idaho.
NOTICE OF APPLICATION
A. The Proposed Sale
YOU ARE HEREBY NOTIFIED that in the present Application, Mr. Greenwood
proposes to sell Algoma Water (and apparently the three non-regulated sewer systems) to Mr.
Carrier for approximately $161 000. Attachment D Addendum No.2. As part of the
Application, Mr. Carrier has submitted a financial statement. The Application indicates that Mr.
Carrier has a background in real estate and "income producing business management.
Application at 1. Mr. Carrier has been investing in Bonner County since 2004 and also owns
real estate in Nevada. The Application states that Mr. Carrier possesses the financial ability to
assume responsibility for the Algoma Water System.
YOU ARE FURTHER NOTIFIED that in addition to the financial statement, the
parties have also included an abbreviated business plan that explains how Mr. Carrier intends to
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30405
incorporate the water company into his other businesses in Idaho. Briefly, Mr. Carrier intends to
retain Bob Hansen of Water Systems Management, Inc. to continue the overall management of
the Company and continue the services of Terry Deal (Deal Pump & Electric) for operational
maintenance and emergency purposes. Finally, the business plan indicates that Mr. Carrier
intends to continue to employ Joan Brittain as the bookkeeper/accountant. Ms. Brittain has been
Algoma s bookkeeper for the last four years.
B. The Proposed Rate Increase
YOU ARE FURTHER NOTIFIED that Algoma also proposes to increase its
monthly, flat rates for service. The Company proposes to increase its monthly flat rates for
service as set out below:
Commercial: from $28.15 to $40.00 (42% increase)
Residential: from $17.59 to $30.00 (70% increase)
Application at 22. The Application states that it has been many years since there has been a rate
increase and that the Company has made extensive repairs to its system during the last two years.
YOU ARE FURTHER NOTIFIED that included with the Application was a copy of
Algoma s customer notice that was included as an insert in the June 2007 billings. The customer
notice mentions the proposed sale of the water company but does not specifically mention the
proposal to increase monthly rates. The Company requests that the Application be processed
under Modified Procedure as expeditiously as possible. The Company has not proposed an
effective date for the requested rate increase.
YOU ARE FURTHER NOTIFIED that the Application, supporting workpapers, and
exhibits have been filed with the Commission and are available for public inspection during
regular business hours at the Commission offices. The Application and workpapers are also
available on the Commission s Website at www.puc.idaho.gov under the "File Room" and then
Water Cases.
YOU ARE FURTHER NOTIFIED that Algoma s intrastate revenue requirement, and
every component of it, both rate base and expense, are at issue. The Commission may grant
deny, or modify the revenue requirement requested and may find a revenue requirement different
from that proposed by any party is just, fair and reasonable.
YOU ARE FURTHER NOTIFIED that the rates and charges for all Algoma retail
customers, both recurring and non-recurring, including those of any special contract customers
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30405
are at issue, and every component of every existing and proposed rate and charge is at issue. The
Commission may approve, reject or modify the rates and charges proposed and may find that
rates and charges different from those proposed by any party are just, fair and reasonable.
YOU ARE FURTHER NOTIFIED that the Commission may approve, reject or
modify existing or proposed relationships between and among rates and charges within, between
or among customer classes or rate groupings. The Commission may approve, reject or modify
existing or proposed relationships among and between customer classes or rate groupings.
YOU ARE FURTHER NOTIFIED that the Commission may abolish, reduce or
create rate blocks or categories of rates and charges; abolish, create or reduce components of
rates and charges; abolish, reduce or create customer classes or rate groupings; and abolish
reduce or create absolute or relative differences among and between existing customer classes or
rate groupings of customers.
YOU ARE FURTHER NOTIFIED that the tariffs, practices, rules, servIces
instrumentalities, equipment, facilities, classifications and customer relations procedures of
Algoma are at issue, and the Commission may address any ofthem in its final Order.
DEADLINE FOR INTERVENTION
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter
for the purpose of presenting evidence or cross-examining witnesses at hearing must file a
Petition to Intervene with the Commission pursuant to this Commission s Rules of Procedure 72
and 73, IDAP A 31.01.01.072 and .073. Persons intending to participate at hearing must file a
Petition to Intervene no later than 14 days from the service date of this Order Persons
seeking intervenor status shall also provide the Commission Secretary with their electronic mail
address to facilitate further communications in this matter.
YOU ARE FURTHER NOTIFIED that persons desiring to present their VIews
without parties ' rights of participation and cross-examination are not required to intervene and
may present their comments without prior notification to the Commission or to other parties.
YOU ARE FURTHER NOTIFIED that once the deadline for intervention has
passed, the Commission Secretary shall issue a Notice of Parties. The Notice of Parties shall
assign exhibit numbers to each party in this proceeding.
YOU ARE FURTHER NOTIFIED that after the Notice of Parties is issued, the
Commission anticipates that the parties will informally convene to devise a recommended
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NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30405
schedule to process this case. Once a schedule is developed, the Commission will subsequently
issue a Notice of Hearing. In addition to the schedule, the parties may discuss discovery
logistics, electronic service, and other scheduling matters.
YOU ARE FURTHER NOTIFIED that the Commission has jurisdiction over this
matter pursuant to Title 61 of the Idaho Code and specifically Idaho Code ~~ 61-302, 61-307,
61-502 , 61-503 , 61-507, 61-622, and 61-623. The Commission may enter any final Order
consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission s Rules of Procedure, IDAPA 31.01.01.000 et seq.
D ISCUSSI
Utility Customer Information Rule 102 requires that a utility notify its customers
when it seeks a general rate increase. IDAPA 31.21.02.102.01. More specifically, the rule
requires that
If the utility is requesting a rate increase, the customer notice shall include a
brief explanation of the utility s need for additional revenue and the dollar
amount requested.The notice shall give the proposed overall percentage
change from current rates as well as the proposed percentage increase in
revenue for each major customer class. The customer notice shall make it
clear that the application is a proposal, subject to public review and a
Commission decision.
IDAPA 31.21.02.102.01 (emphasis added). Based upon Staffs calculations, the Company seeks
an annual revenue increase of $3,980.52. Application at 22.
We find that Algoma shall prepare and distribute a customer notice providing the
required information about its proposed rate increase. The elements of the customer notice are
set out in the Commission s Rule 102 above. The Company may provide such a notice as a bill
stuffer in its monthly billing. The Company shall also send a press release of its proposed rate
increase to media outlets in the vicinity.
ORDER
IT IS HEREBY ORDERED that persons desiring to intervene in this case for the
purpose of presenting evidence or cross-examination at hearing shall file a Petition to Intervene
with the Commission no later than fourteen (14) days from the service date ofthis Order.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30405
IT IS FURTHER ORDERED that Algoma notify its customers that it is seeking a
general rate increase. The Company shall also send a press release to media outlets in its
vicinity. A copy of the press release should also be filed with the Commission.
IT IS FURTHER ORDERED that after the Notice of Parties is issued, the Staff shall
convene an informal prehearing conference with the parties to discuss the processing of this case.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this /:3
rf-
day of August 2007.
~4~PAUL KJELLAND . , PRESIDENT
I(~
MARSHA H. SMITH, COMMISSIONER
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ATTEST:
bls/O:AWS-07-01 dh
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30405