20051118Decision memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:SCOTT WOODBURY
DATE:NOVEMBER 17, 2005
SUBJECT:CASE NO. FLS-05-1 (Falls Water)
APPLICATION TO INCREASE RATES AND CHARGES
On November 4, 2005 , Falls Water Company, Inc. (Falls Water; Company) filed an
Application with the Idaho Public Utilities Commission (Commission) requesting authority to
increase its revenue requirement by $258,363 (48.2%). The Company also submitted proposed
changes in base rates and commodity charges for water service. Falls Water is an Idaho not-for-
profit corporation and holder of Certificate of Public Convenience and Necessity No. 236. Falls
Water provides water service in the Idaho Falls area to approximately 2 147 metered residential
customers, 49 multi-family residential customers, 41 metered commercial customers, and 583
flat rate residential customers. The Company maintains that an increase in rates is needed to
keep up with the increasing costs of operations and maintenance and to replace its aging
infrastructure.
Falls Water is seeking a reduction in the amount of water included in the minimum
billing charge, and proposes to create a summer and winter rate schedule for metered residential
customers.The Company proposes a new metered residential tariff for customers in
subdivisions that were allowed to connect to Falls Water on condition that the Company would
only provide potable domestic in-house water. Also proposed by the Company is a planned
phase-out of its flat rate and a field collection fee for past due balances
The changes in rates and charges proposed by the Company are as follows:
DECISION MEMORANDUM
Schedule Description Existinl!Proposed
Existing: Residential $11.50/month minimum Summer Apr. -Oct.
Metered Service $12.75/billing cycle
$O.4l1thousand gallons for mInImUm
Proposed: Residential all water used in excess of
Metered Service for 000 gallons/month $0.85/thousand gallons
customers not living in for all water used in
developments required to excess of 8 000
use secondary irrigation gallons/billing cycle
Winter Nov.March
$15.50/billing cycle
minImUm
$0.85/thousand gallons
for all water used in
excess of 15 000
gallons/billing cycle
Residential Flat Rate $17.50/month $19.25/month
Service
Residential Multi-Family $11.50/month minimum $12.7 5/billing cycle
mInImUm
$O.4l1thousand gallons for
all water used in excess of $0.85/thousand gallons
000 gallons/month for all water used in
excess of 8 000
gallons/billing cycle
Metered Residential with $12.75/billing cycle
Secondary Irrigation minimum
$2.50/thousand gallons
for all water used in
excess of 8 000
gallons/billing cycle
Metered Commercial $11.50/month minimum $12.75/billing cycle
Service mInImum
$O.4l1thousand gallons for
all water used in excess of $0.85/thousand gallons
000 gallons/month for all water used in
excess of 8 000
gallons/billing cycle
Schedule Field Collection Fee (of $15.
past due balance)
DECISION MEMORANDUM
If the proposed changes in rates are approved, the average annual rates for metered
residential customers would increase from $179.49 to $295., an increase of$116.06 or 64.7%.
The average annual rates for metered commercial customers would increase from $323.46 to
$569., an increase of $246.29 or 76.1 %. Annual rates for non-metered residential customers
would increase from $210 to $231 , an increase of $21.00 or 10%. Annual rates for multi-family
residential customers would increase from $181.64 to $344., an increase of$163.18 or 89.8%.
The Company requests an effective date of April 15, 2006.
COMMISSION DECISION
Staff recommends that the Commission issue a Notice of Application in Case FLS-
W -05-1 and establish a deadline for intervention. Staff will recommend further procedure and
scheduling after its initial review and audit of the Company s operations and records. Does the
Commission agree with the Staffs proposed procedure?
Scott D. Woodbury
bls/M:FLS-OS-OI sw
DECISION MEMORANDUM