20120913order_no_32642.pdf

Office of the Secretary
Service Date
September 13,2012
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF FALLS WATER COMPANY FOR AN )CASE NO.FLS-W-12-Ol
ORDER AUTHORIZING INCREASES IN )THE COMPANY’S RATES AND CHARGES )ORDER NO.32642
FOR WATER SERVICE )
On January 30,2012,Falls Water Company applied to the Commission for authority to
increase its total revenue requirement by $295,059.75,or 26.52%.Application at 1,4.The
Company said the accompanying rate increase would take effect on February 29,2012,and would
increase the average customer’s bill by 26.8%.Id.at 2 and 5.
On February 22,2012,the Commission suspended the proposed schedule of rates and
charges for an initial period of thirty (30)days plus five (5)months from the proposed February 29,
2012 effective date,until August 28,2012.Order No.32467,Idaho Code §61-622.On March
16,2012,the Commission issued a Notice of Public Workshop,Notice of Modified Procedure,
and Notice of Public Hearing setting comment and reply deadlines and a public workshop and
customer hearing.See Order No.32487 and corresponding Errata.The workshop and customer
hearing occurred,Staff and members of the public filed written comments,and the Company
filed a written reply.On August 24,2012,the Commission extended the suspension period to
September 18,2012.See Order No.32626.
With this Order the Commission suspends the Company’s proposed schedule of rates
and charges for an additional 28 days,until October 16,2012.We also authorize Staff to file a
short,issue-narrowing surrebuttal by September 28,2012,that identifies whether Staff accepts
any of the additional proposals raised in the Company’s reply.
LEGAL STANDARD
Idaho Code §61-622 sets forth the Commission’s authority to suspend the effective
date of a proposed rate increase.The section states,in pertinent part:
No public utility shall raise any rate ...under any circumstances whatsoever
except upon a showing before the commission and a finding by the
commission that such increase is justified.The commission ...is hereby
given authority..,to enter upon a hearing concerning the propriety of such
rate ...and pending the hearing and decision thereon,such rate ...shall not go
into effect;provided,that the period of suspension of such rate ...shall notextendbeyondthirty(30)days when such rate ...would otherwise go into
ORDER NO.32642 1
effect,pursuant to section 6 1-307,Idaho Code,unless the commission in its
discretion extends the period of suspension for an initial period not exceeding
five (5)months,nor unless the commission after a showing of good cause
on the record grants an additional sixty (60)days....
Idaho Code §6 1-622 (emphasis added).
The Idaho Supreme Court addressed the Commission’s additional suspension
authority under this section in Washington Water Power Co.V.Idaho Pub.Util.Comm ‘n,101
Idaho 567 617 P.2d 1242 (1980).The Court held that “a showing of good cause on the record”
means the record in the case must disclose that the additional days are necessary,as opposed to
allowing the Commission to act with absolute discretion.Id.101 Idaho at 571,617 P.2d at 1246.
The Court rejected the utility’s contention that the statute required proper notice,opportunity to
be heard,and a showing of good cause before the additional 60-day suspension could be granted,
and stated that this requirement “could likely result in many of the additional sixty days being
utilized solely in determining whether to grant the additional days.”Id.Finally,the Court held
that the Commission acted properly in determining from the record that good cause existed to
suspend the rates for the additional 60 days because of the size of the increase requested,the
complexity of the cases presented by the Company,and the current workload of the Commission.
Id.101 Idaho at 572,617 P.2d at 1247.
DISCUSSION AND FINDINGS
The Commission has reviewed the record in this case,which includes the hearing
transcript,exhibits,pleadings,Staff and public written comments and the Company’s written
reply.We also have reviewed our current workload,and the applicable laws of this state and
rules of the Commission.Based on this review,we find that good cause exists to order an
additional period of suspension during which the Commission may issue its final Order in this
matter.
As noted in Order No.32626,this case involves a small water utility requesting a
large general rate increase,which necessarily involves numerous complex and technical issues in
reaching a final decision and Order.In addition to the size of the requested rate increase,the
complexity of this particular case is compounded by the fact that there is a large disparity
between the Company’s case and the recommendations of Commission Staff.For example,
while the Company initially requested an overall revenue increase of $295,059.75,or 26.52%,
which the Company calculated using a $2,545,288 rate base,Staff recommended a revenue increase
ORDER NO.32642
of $15,832,or 1.4%.which Staff calculated using a $1,821,140 rate base.We further note that
the Company has expressed that Staff’s proposed reduction to rate base “would have catastrophic
effects”on the Company.Company Reply at 3.
In light of the above,the Commission finds it needs additional time to thoroughly
review the record and analyze the comments and the parties’respective positions.Accordingly,
we find that there is good cause to continue the suspension period for another 28 days,until
October 16,2012.Idaho Code §61-622.
In addition,while the Company’s reply agrees with Staff on certain points,it raises
numerous rebuttal arguments on other issues.To assist us in our deliberation,Staff may file a
short surrebuttal by September 28,2012,explaining what parts of the Company’s reply Staff
agrees with,if any.Staffs pleading should not argue why Staff may disagree with any of the
positions stated in the Company’s reply.Rather,the pleading should merely advise us on
whether Staff accepts any of the Company’s positions given the reply,thereby potentially
narrowing the technical issues in dispute.
ORDER
IT IS HEREBY ORDERED that the Company’s Application shall be suspended for
an additional 28 days,until October 16,2012.unless the final Order is issued sooner.
IT IS FURTHER ORDERED that Staff may file a surrebuttal no later than September
28,2012,identifying what parts of the Company’s reply Staff agrees with,if any,consistent with
the above discussion.
ORDER NO.32642 3
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this /3
day of September 2012.
ATTEST:
MARSHA H.SMITH,COMMISSIONER
Jean D.Jewell
Commission Seèretary
O:FLS-W-I 2-Olkk4
\;
iACK A.REDFORIOMMISSIONER
ORDER NO.32642 4