20070420Decision memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
CO MMISSI 0 NER RED FO RD
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:DONOVAN E. WALKER
DATE:APRIL 20, 2007
SUBJECT:DIAMOND BAR ESTATES WATER COMPANY'S APPLICATION TO
INCREASE RATES AND CHARGES, CASE NO. DIA-07-
On April 13 , 2007, Diamond Bar Estates Water Company filed an Application to
increase its rates for water service, its fees for installation of a meter, and implementation of a
new customer connection charge. The Company requests an effective date for the new rates and
charges of June 1 , 2007. The Company also requests that its Application be processed by
Modified Procedure.
THE APPLICATION
Diamond Bar Estates Water was granted a Certificate of Public Convenience and
Necessity authorizing it to provide water service to the Diamond Bar Estates Subdivision in
Kootenai County, Idaho, on May 30, 2003. Case No. GNR-02-, Order No. 29247. The
Company s initial rates and charges were also approved and set with Order No. 29247. The
Company s authorized service territory was expanded to include the Boekel Estates Subdivision
on August 2 2004. Case No. DIA-04-, Order No. 29556.
According the Company s Application it is seeking authority to: (1) increase the
water rate it charges customers by approximately 87.44%; (2) increase the fees for the first time
installation of a meter to serve a new customer from $200 to $310; and (3) implement a new
customer connection charge of either $2 500 or $5 500 where a service line to the property does
not currently exist.
According to the Company s Customer Notice the Company is proposing to increase
the base monthly charge for the first 7 500 gallons of water from $21.00 per month to $50.00 per
DECISION MEMORANDUM
month. Additionally, the Company proposes to increase the charge for water usage in excess of
500 gallons per month from $0.45 to $0.52 per thousand gallons. The Company states that this
increase is necessary so that it can recover its operating costs, and that it has been operating at a
loss for a number of years. Diamond Bar Water provides service to approximately 43 customers.
STAFF RECOMMENDATION
Staff has reviewed the Company s Application and agrees that this matter would be
appropriate for Modified Procedure. Because of Staff s current workload, and constraints on
performing an audit and recommended workshop, Staff recommends suspending the Company
proposed effective date of June 1 , 2007. Staff will not be available to schedule the required on-
site audit and possible workshop until late June. Consequently, Staff recommends a comment
deadline on Modified Procedure of August 10, 2007. Additionally, based upon the size and
nature of the requested increase in rates and charges, Staff recommends that a workshop,
pursuant to Rule 125 , IDAPA 31.01.01.125, be held.
COMMISSION DECISION
Does the Commission wish to suspend the Company s proposed effective date of
June 1 , 2007, pursuant to Idaho Code ~ 61-622?
If so, does the Commission wish to authorize the use of Modified Procedure with a
comment deadline of August 10, 20077
Does the Commission wish to direct Staff to conduct a public workshop pursuant to
Rule 125, IDAP A 31.01.01.125?
Donovan E. Walker
DECISION MEMORANDUM