20151203notice_of_application_order_no_33430.pdf

Office of the Secretary
Service Date
December 3,2015
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF EAGLE WATER )CASE NO.EAG-W-15-01
COMPANY’S APPLICATION FOR )
AUTHORITY TO IMPLEMENT A CUSTOMER )NOTICE OF APPLICATION
SURCHARGE )
)NOTICE OF
)INTERVENTION DEADLINE
ORDER NO.33430
On November 10,2015,Eagle Water Company filed an Application seeking authority
to implement an immediate and temporary surcharge of 53.82%on customers’water usage in
excess of 600 cubic feet per month.The Company also requests permission to access funds in an
existing surcharge account.The new surcharge and the existing balance in the surcharge account
would be used by Eagle Water to pay for several large capital improvement projects,and its legal
and accounting fees associated with this proceeding.Application at 3-5.Eagle Water further
requests that its Application be processed via Modified Procedure and that the surcharge become
effective upon Commission Order pursuant to Idaho Code §6 1-307.
BACKGROUND
Eagle Water serves approximately 3,500 customers in and around the City of Eagle.
See Application,Exhibit D.Its water supply is currently provided from six wells (Well Nos.1,
2,3,6 and 7).See Order No.30936.A seventh well,Well No.8,which is a major subject of
this Application,has been drilled,but its operational status is unclear.
Since September 1992,Eagle Water has implemented various customer surcharges in
addition to its basic charges for water service and customer hookup fees.See Eagle Water Rate
Schedule No.5;Commission Order Nos.29903,29969,and 30936.In 2005,the Company
requested and received permission to implement a surcharge to recover charges for engineering,
accounting and legal expenses to remedy poor water pressure at the time.In 2009,Eagle Water
requested,and the Commission authorized,the Company to collect additional surcharge revenue
for legal and accounting costs,and specific items relating to system maintenance.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.33430 1
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that Eagle Water seeks to recover the costs
associated with several capital projects,and professional fees (accounting and legal)through a
new customer surcharge.The capital improvements and other expenses are outlined below.
CAPITAL IMPROVEMENTS COST
Main Booster Station $148,780.00
Construction of Well No.8 $598,480.00
Well No.4 Repairs $62,245.00
Well No.6 Repairs $25,586.00
State Street Bridge Line Relocation $13,432.00
Horseshoe Bend Road Bridge Line Relocation $6,489.00
Well No.7 —Upsize Line $43,608.00
Hill Road Line Relocation $25,295.00
Subtotal $924,515.00
EXPENSES
Accounting Fees $600.00
Legal Fees $10,125.00
Subtotal $10,725.00
The total for capital improvement projects and expenses is $935,240.Application at 2-5.
YOU ARE FURTHER NOTIFIED that to defray these actual and projected costs set
out above,the Company proposes to borrow $786,242 from D.L.Evans Bank.According to the
proposed terms of the bank loan,Eagle Water will borrow $786,242 at a variable interest rate of
the Wall Street Journal Prime rate +2.00%with a floor rate of 5.5%over a projected term of
about five years.Application,Exh.C.To repay the loan,the Company proposes to implement
an immediate surcharge of 53.82%for usage above 600 cubic feet per month.In addition to the
surcharge,the Company also seeks permission to access the remaining balance in the surcharge
account.The Company reports that the current balance in the prior surcharge account is
approximately $149,000.Application at 5.The Company proposes to use these surcharge funds
to offset costs.Id.
YOU ARE FURTHER NOTIFIED that the Company estimates that if the surcharge
is approved,a customer using 700 cubic feet of water per month would experience an increase of
240.to an $8.24 per month bill.Eagle Water claims that even if the surcharge is approved,its
overall rates “are considerably lower than either the City of Eagle’s municipal water system rates
or United Water-Idaho’s rates.”Application,Exh.G.
NOTICE OF APPLICATION
NOTICE OF iNTERVENTION DEADLINE
ORDERNO.33430 2
YOU ARE FURTHER NOTIFIED that the Company requests the surcharge to “take
immediate effect upon the Commission Order”pursuant to Idaho Code §61-307.’Application
at 6.
YOU ARE FURTHER NOTIFIED that the Application and 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 testimonies are also
available on the Commission’s web site at www.puc.idaho.ov.Click on the “File Room”tab at
the top of the page,scroll down to the type of “Open Water Cases,”and then click on the case
number as shown on the front of this document.
STAFF REVIEW
Commission Staff believes that a thorough review of the Company’s Application is
necessary.Staff thus recommended the Commission issue a Notice of Application that suspends
the requested immediate effective date by a period of 90 days.See Idaho Code §61-622(3-4).
Staff further recommended this case is appropriate for processing under the Commission’s rules
of Modified Procedure.Staff recommended the Commission issue a Notice of Application and
set a deadline for intervention.The Company has no objection to these recommendations.
DISCUSSION
After reviewing the Company’s Application and Staff’s recommendations,we find it
is prudent to issue a Notice of Application and suspend Eagle Water’s proposed immediate
effective date (December 10,2015)by 90 days.We further find it reasonable to establish a 14-
day intervention deadline;and direct Staff Counsel to convene a scheduling conference with the
parties once the intervention deadline passes.
NOTICE OF INTERVENTION DEADLINE
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter
for the purpose of becoming a party presenting evidence or cross-examining witnesses at
hearing,if any,must file a Petition to Intervene with the Commission pursuant to this
Commission’s Rules of Procedure 72 and 73,IDAPA 31.01.01.072 and -.073.Persons intending
to participate as a party must file a Petition to Intervene no later than fourteen (14)days from
the service date of this Order.Persons desiring to present their views without parties’rights of
Idaho Code §6 1-307 provides in part that no change in rates shall be made by a utility “except after thirty (30)
days’notice to the commission and to the public
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.33430 3
participation and cross-examination are not required to intervene and may present their
comments without prior notification to the Commission or the parties.
YOU ARE FURTHER NOTIFIED that the Commission Secretary shall issue a
Notice of Parties after the deadline for intervention has passed and the Commission has reviewed
any timely petitions to intervene in this matter.The Notice of Parties shall assign exhibit
numbers to each party in this proceeding.
YOU ARE FURTHER NOTIFIED that once the Notice of Parties is issued,
Commission Staff will convene an informal prehearing conference to discuss a schedule of this
case and other issues as may be raised by the parties.
YOU ARE FURTHER NOTIFIED that the following persons are designated as Eagle
Water’s representatives in this matter:
Molly O’Leary
1775 W.State Street,#150
Boise,Idaho 83702
E-mail:[e-mail]
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code and specifically
Idaho Code §61-501,61-503,61-507,61-520,61-523,and 61-622.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.
ORDER
IT IS HEREBY ORDERED that persons desiring to intervene in this matter for the
purpose of participating as a party shall file a Petition to Intervene with the Commission no later
than fourteen (14)days from the service date of this Order.
IT IS FURTHER ORDERED that discovery is available in this matter pursuant to the
Commission’s Rules of Procedure,IDAPA 31.01.01.221-234.
IT IS FURTHER ORDERED that Eagle Water’s proposed effective date of
December 10,2015,is suspended for a period of 90 days,until March 10,2016,unless the
Commission issues an earlier Order accepting,rejecting,or modifying the Application.See
Order No.33130 and Idaho Code §61-622(4).
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDERNO.33430 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of December 2015.
PAUL KJ LANDE),PRESIDENT
MARSHA H.SMITH,COMMISSIONER
%EiQ)
KRI’STINE RAPER,COMMISSIONER
ATTEST:
mmission Secretary
O:EAG-W-15-0 lbk
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDERNO.33430 5