20181228notice_of_proposed_settlement_order_no_34225.pdf

Office of the Secretary
Service Date
December 28,2018
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF EAGLE
WATER COMPANY'S APPLICATION
FOR AUTHORITY TO IMPLEMENT
A CUSTOMER SURCHARGE
CASE NO. EAG.W.Is.OI
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34225
On November 10, 2015, Eagle Water Company fiIed an Application seeking authority
to implement an immediate and temporary surcharge of 53.82% on customers' water usage over
600 cubic feet per month. The Company also requests permission to access funds in an existing
surcharge account. The Company would use the new surcharge and the existing balance in the
surcharge account to pay for several large capital improvement projects, and its legal and
accounting fees associated with this proceeding. Application at 3-5.
On December 3, 2015, the Commission issued a Notice of Application and Notice of
Intervention Deadline. No one intervened in the case. The Commission also suspended the
proposed effective date for 90 days, until March 10, 2016. Order No. 33430. The Company
subsequently agreed to several further suspensions. See Order Nos. 33478, 33509. On August 10,
2076, the Commission approved a stipulation between the Company and Staff to stay all
proceedings in this matter for one year, or "until such a time that the parties file a joint motion to
lift the stay." Order No. 33567. In October 2017 , the Commission granted an indefinite stay of all
proceedings. Order No. 33911.
On December 14, 2018, Staff filed a motion requesting the Commission approve a Joint
Settlement Stipulation (the "Settlement") in this matter, and order a procedural schedule. Staff also
reported that the parties jointly recommend that the Commission lift the stay and process the
proposed Settlement by Modified Procedure. With this Order, we lift the stay, provide notice of
the proposed Settlement, and set a schedule to process the proposal.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
oRDER NO. 34225
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NOTICE OF PROPOSED SETTLEMENT
YOU ARE HEREBY NOTIFIED that, in summary, the Settlement proposes to fully
resolve the case as follows:l
L Rates and chorges
The resulting settlement will not increase rates or charges to any Eagle Water customer.
Rather, the Company will discontinue hookup charges of $600 per Tariff Schedule No. 5. The
balance of the hookup charge account (approximately $370,000) will remain in the account to be
used as a line-of-credit.
2. Accounting Correction
The parties submit that the Company has accumulated a substantial negative rate base
through years of improperly booking capital expenditures, and failing to maintain documentation
of plant. The negative rate base has accumulated to the point of creating unsound ratemaking
requests, such as the proposed surcharge in the underlying Application. Based on an extensive
audit conducted by Staff, the parties agree that a one-time accounting correction be made. That is,
an elimination of negative base in 2008 of $1,236,375 inyear 2008 represented in contributions in
aid of construction.
3. Capitalized Plant
The parties have agreed to allow caprtalizatron of improperly documented plant
including the Company's well 8, meters, repairs, equipment, materials, and labor. Going forward,
the Company must properly document and capitalize all plant and labor, or recovery will be
disallowed.
4, Accounting and Reporting
The parties have agreed that the Company will provide Staff with quarterly reports of
costs and expenses. Staff will conduct routine audits to ensure proper booking of expenditures.
5. Collaboration on Tarffi
The Company agreed to work with Staff to update the Company's tariff language to
the Commission's satisfaction.
I The proposed Settlement, including its attachments, is more detailed than this summary. Interested persons may
view the proposed Settlement on the Commission's web site.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
oRDER NO. 34225 2
COMMISSION SETTLEMENT RULES
YOU ARE FURTHER NOTIFIED that the Commission will review the proposed
Settlement consistent with Commission Rules 271-280.
YOU ARE FURTHER NOTIFIED that the Commission is not bound by the proposed
Settlement. The Commission will independently review the proposed Settlement to decide whether
to approve it, reject it, or state conditions under which to accept it. The proposed Settlement's
proponents ultimately must prove it is just, fair, and reasonable, in the public interest, or otherwise
in accordance with law or regulatory policy.
YOU ARE FURTHER NOTIFIED that the proposed Settlement, Application, and
supporting workpapers, testimony, and exhibits are available for public inspection during regular
business hours at the Commission offices. They also may be viewed on the Commission's web
site at www.puc.idaho.gov by clicking on "File Room" and then "Water Cases" and then going to
the case numbers referenced in the above caption.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the proposed
Settlement, and has determined that the public interest may not require a formal hearing in this
matter and will proceed under Modified Procedure pursuant to Rules 201 through2}4 of the Idaho
Public Utilities Commission's Rules of Procedure, IDAPA 31.01.01.201 through .204. The
Commission notes that Modified Procedure and written comments have proven to be an effective
means for obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that any person or party desiring to state a position
on the proposed Settlement may file a written comment in support or opposition with the
Commission no later than January 1612019. The comment must contain a statement of reasons
supporting the comment. Persons desiring a hearing must specifically request a hearing in their
written comments. Written comments concerning this matter shall be mailed to the Commission
and the Applicant at the addresses reflected below:
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, lD 83720-0074
Molly O'Leary
BizCounselor@Law PLLC
1775 W State St. #150
Boise,Idaho 83702
e-mail : [e-mail]
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
oRDERNO.34225 )
Street Address for Express Mail
472 W. Washington Street
Boise, ID 83702-5918
Comments should contain the case caption and case number shown on the first page of this
document. Persons desiring to submit comments via e-mail may do so by accessing the
Commission's home page located at www.puc.idaho.gov. Click the "Case Comment or Question
Form" under the "Consumers" tab, and complete the comment form using the case number as it
appears on the front of this document. These comments must also be sent to the Applicant.
YOU ARE FURTHER NOTIFIED that the Company may file reply comments, if
necessary, no later than January 23r2019.
YOU ARE FURTHERNOTIFIED that ifno written comments orprotests are received
within the time limit set, the Commission may consider this matter on its merits and enter its Order
without a hearing. If written comments are received within the time limit set, the Commission will
consider them and, in its discretion, may set the same for formal hearing.
ORDER
IT IS HEREBY ORDERED that this case be processed by Modified Procedure.
Interested persons may file written comments about this case, or protest the use of Modified
Procedure, no later than January 16,2019.
IT IS FURTHER ORDERED that the parties may file reply comments, if any, no later
than January 23,2019.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
oRDER NO. 34225 4
zf4DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of December 2018.
PAUL PRESIDENT
SIONER
ERIC ANDERSON, COMMISSIONER
Diane M. Hanian
Commission Secretary
I:\Legal\WATER\EAG-W- I 5-01\Orders\EAGWI 501_bk7.docx
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
oRDER NO. 34225 5