20030908Final Order No 29332.pdf

Office of the Secretary
Service Date
September 8, 2003
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF CAPITOL WATER
CORPORATION'S APPLICATION FOR A
TEMPORARY SURCHARGE, A
DECLARATION OF PRUDENCY, AND
AUTHORITY TO INCUR DEBT TO FUND
SYSTEM IMPROVEMENTS.
ORDER NO. 29332
CASE NO. CAP-O2-
During its review of Capitol Water Corporation s ("Capitol Water" or "Company ) Rules
Summary, Staff discovered that Capitol Water was not billing its customers according to the
Company s approved tariffs. From June 2002 through July 2003, the Company rounded the total
billed amount to the nearest 5-cents rather than collecting the actual tariff rate. In this Order, the
Commission directs Capitol Water to credit its surcharge revenues account by $989.24 and file tariffs
consistent with the findings made below.
BACKGROUND
The Commission Staff questioned the Company about the bill-rounding practice and
found that the Company believed it was authorized to do so based on a previous Order. In Case No.
CAP- W -96- 2, Capitol Water requested and the Commission granted rates that were set at the nearest
5-cents for ease of billing. Order No. 27022. The Commission subsequently permitted the Company
in May 2002 to incur debt and implement residential and commercial surcharges. Order No. 29035
at 11. However, the Commission did not authorize the Company to round these (current) rates to the
nearest 5-cents.
The Company s incorrect billing practices resulted an over-collection of$989.24 over 14
months from its 2 392 flat rate customers. According to Staff, the Company has remedied the
situation on a going-forward basis and is billing the appropriate tariff rates as of July 2003.
In a decision memorandum dated August 22, 2003 , Staff recommended that the over-
collection be credited to the Company s current surcharge account rather than crediting each flat rate
customer approximately $0.40 on average. Staff and the Company agree that crediting the surcharge
account the $989.24 will fairly distribute the over-collected funds back to customers, payoff the
surcharge slightly faster, and would be the easiest bookkeeping remedy. Furthermore, crediting the
ORDER NO. 29332
surcharge account provides customers with an outcome similar to crediting individual customer
accounts.
In addition to the billing error, Staff discovered a minor error in the Company s Tariff
Schedule No.1 franchise fee calculation. The franchise fee calculation for I-inch metered service
was shown at $0.51 when the actual amount should have been $0.52. Staff has worked with the
Company to revise and resubmit this tariff page with the correct calculation. Even though the
franchise fee calculation was shown incorrectly on the tariff page, the total rate was calculated
correctly. Therefore, neither the Company nor customers would be affected by this tariff sheet
correction.
COMMISSION FINDINGS
The Commission has jurisdiction over Capitol Water Corporation, a water utility,
pursuant to the provisions of Idaho Code, Title 61 , and the Commission s Rules of Procedure
IDAP A 31.01.01.000 et seq.
Based upon our review of the record in this case, the Commission finds that customers
should have been billed at the actual rates established by Order No. 29035 rather than rounding each
bill up to the nearest 5-cents. We also find that ratepayers are owed $989.24 due to this over-
collection. Based on the recommendations ofthe Company and Commission Staff, the Commission
finds it reasonable and in the public interest for the Company to credit its surcharge revenues account
by this amount. Because each customer is owed a relatively small credit to compensate for the over-
collection, it is appropriate to minimize administrative expenses and bookkeeping by reducing the
surcharge balance to be paid by customers. We direct Capitol Water to credit the surcharge revenues
account by the over-collected $989.24 and file appropriate tariffs to correct the franchise fee
calculation issue identified by Staff no later than September 15 , 2003.
ORDER
IT IS HEREBY ORDERED that Capitol Water Corporation, to the extent it has not
already done so, cease rounding the bills of its flat rate customers to the nearest 5-cents and credit its
surcharge revenues account by the $989.24 that was over-collected.
IT IS FUTHER ORDERED that Capitol Water file tariffs consistent with this Order no
later than September 15 2003.
ORDER NO. 29332
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days ofthe service date ofthis Order. Within seven (7) days
after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code 9 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho, this ~
".,...
day of September 2003.
6LlL
ARSHA H. SMITH, COMMISSIONER
ATTEST:
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ORDER NO. 29332