Excel Document PDF Document

cover

Standard Practice U-46-W

                 

CALIFORNIA PUBLIC UTILITIES COMMISSION

                 
                 

ADVICE LETTER RATE ADJUSTMENT WORKBOOK

For Water Utilities Regulated by the CPUC

Required Workpapers for rate increases (decreases)

                 
                 
                 

WATER UTILITY NAME:

           
                 
                 
                 

ADDRESS OF UTILITY:

           
     

Street, P.O. Box and/or suite number

   
                 
                 
     

City and Zip Code

   
                 
                 

PHONE NUMBER:

( )

       
     

area code

       
                 
                 
                 

CPUC CLASS SIZE:

 

B

C

(circle one)

 
                 
                 
                 

Requested Adjustment:

           
                 
                 

Increase (decrease)

           
     

dollar amount

   
                 
                 
                 
   

percent above (below) current revenue requirement

 
                 
                 
                 
                 
             

July 26, 2001

 

info

INFORMATION SHEET

                 
                 
                 

NAME:

               
                 
                 

ADDRESS:

               
                 
                 
                 
                 
                 
                 
                 
               

NAME OF PERSON TO CONTACT REGARDING THIS FILING:

     
                 
                 
                 
                 
                 

PHONE:

               
                 
                 

DESCRIBE OWNERSHIP OF COMPANY:

         
                 
                 
                 
                 
                 
                 
                 
                 

DATE OF LAST GENERAL RATE CASE FILING:

         
                 
                 

DATE OF LAST OFFSET:

             

org.

This workbook is organized in a manner whereby the user can work through

each section to:

             
                 
                 

1st

Estimate revenues at present rates

       
                 

2nd

Estimate operating expenses

       
                 

3rd

Calculate return for rate making purposes

     
                 

4th

Estimate taxes other than income

       
                 

5th

Estimate summary of operations at present rates

   
                 

6th

Determine revenue requirements

       
                 

7th

Demonstrate a summary of earnings at proposed rates

 
                 

8th

Design proposed rates

         
                 
                 

This workbook is intended to provide the CPUC with a base of information to begin processing of Advice Letter filings for changes in rates. Utilities are to provide all information necessary to support amounts entered herein. Cross reference all information.

I and II

_____________ WATER COMPANY

ADVICE LETTER RATE INCREASE

WORKPAPERS

                           
                           

Complete all of the following schedules for your

Class B or C water utility

                           

TABLE OF CONTENTS

                           

FOR TEST YEAR _______

                           

DATE SUBMITTED TO CPUC: _____________________

                           
           

Attachment

 

Items

 
           

Sheet

 

Checked

 

SECTION I

REVENUES AT PRESENT RATES

               
                           
   

Summary of Revenues at Present Rates

 

I-1

     

c

   
   

Include the appropriate schedules:

               
   

Estimate of Metered Customers by Meter Size

 

I-2

     

c

   
   

Estimate of Flat Rate Customers

 

I-3

     

c

   
   

Estimate of Private Fire Protection Customers and

               
   

Revenues for Present Rates

   

I-4

     

c

   
   

Estimate of Metered Revenues at Present Rates

 

I-5

     

c

   
   

Estimate of Flat Rate Revenues at Present Rates

 

I-6

     

c

   
                           

SECTION II

OPERATING EXPENSES

                 
                           
   

Summary - Estimate of Operating Expenses

 

II-1

     

c

   
   

Estimate of Water Production (no flat rates)

 

II-2a

     

c

   
   

Estimate of Water Production (with flat rates)

 

II-2b

     

c

   
   

Estimated Purchased Water

   

II-3

     

c

   
   

Power Expense - Test Year

   

II-4a

     

c

   
   

Power Schedule - Recorded Year

 

II-4b

     

c

   
   

Power Expense by Rate Schedule - Test Year

 

II-4c

     

c

   
   

Power Expense by Power Schedule - Test Year

 

II-4d

     

c

   
   

Other Volume Related Expenses

 

II-5

     

c

   
   

Estimate of Payroll Costs and Expenses

 

II-6

     

c

   
   

Materials

       

II-7

     

c

   
   

Contract Work

     

II-8

     

c

   
   

Transportation Expenses

   

II-9

     

c

   
   

Other Plant Maintenance

   

II-10

     

c

   
   

Employee Pensions/Benefits

   

II-11

     

c

   
   

Uncollectibles

     

II-12

     

c

   
   

Office Services and Rentals

   

II-13

     

c

   
   

Office Supplies and Expense

   

II-14

     

c

   
   

Professional Services

   

II-15

     

c

   
   

Insurance

       

II-16

     

c

   
   

Regulatory Commission Expense

 

II-17

     

c

   
   

General Expense

     

II-18

     

c

   

III - VIII

           

Attachment

 

Items

           

Sheet

 

Checked

                       

SECTION III

RETURN

                 
                       
   

Requested Return

     

III-1

     

c

   

Estimated Rate Base

     

III-2

     

c

   

Estimate of Average Utility Plant

   

III-3

     

c

   

Estimate of Average Construction Work

           
   

in Progress

     

III-4

     

c

   

Estimate of Average Materials and

           
   

Supplies Inventory

     

III-4

     

c

   

Working Cash

     

III-5

     

c

   

Estimated Depreciation

   

III-6

     

c

   

Estimated Average Reserve for Depreciation

 

III-7

     

c

   

Estimated Average Advances for Construction

 

III-8

     

c

   

Estimated Average Contributions in Aid

           
   

of Construction

     

III-8

     

c

   

Estimated Average Deferred Income Taxes

 

III-9

     

c

   

Estimated Average Deferred Investment

           
   

Tax Credits

     

III-9

     

c

                       

SECTION IV

TAXES OTHER THAN INCOME

             
                       
   

Property and Payroll Taxes

   

IV-1a

   

c

   

Schedule of Other Taxes and Licenses

 

IV-1b

   

c

                       

SECTION V

SUMMARY OF OPERATIONS AT PRESENT RATES

       
                       
   

Income Taxes at Present Rates

   

V-1

     

c

   

Summary of Operations at Present Rates

 

V-2

     

c

                       

SECTION VI

PROPOSED GROSS REVENUE

           
                       
   

Gross Revenue Development

   

VI-1

     

c

   

Income Tax Net to Gross 15%

   

VI-2a

   

c

   

Income Tax Net to Gross 28%

   

VI-2b

   

c

   

Income Tax Net to Gross 34%

   

VI-2c

   

c

   

Income Tax Net to Gross 39%

   

VI-2d

   

c

   

Income Tax at Proposed Rates

   

VI-3

     

c

                       

SECTION VII

SUMMARY OF EARNINGS AT PROPOSED RATES

         
                       
   

Summary of Earnings at Proposed Rates

 

VII-1

   

c

                       

SECTION VIII

RATE DESIGN

               
                       
   

Rate Design Worksheet

   

VIII-1

   

c

I

SECTION I

                   

The intent of Section I is to estimate revenues at present rates. The following tables can be completed by using data from recent annual reports (CPUC Rpt.). The following instructions should be completed in sequence. The first page of this section is the SUMMARY page and thus is completed last.

                   

Instructions for Section I

           
                   
                   

1

Complete line 10 of Sheet I-5 using data from CPUC Rpt.

     
                   

2

Complete Sheet I-2.

           
                   

3

Complete Sheet I-3 (if applicable).

         
                   

4

Complete Sheet I-4 (if applicable).

         
                   

5

Complete Sheet I-6 (if applicable).

         
                   

6

Complete remainder of Sheet I-5.

         
                   

7

Complete Sheet I-1.

           

Sheet I-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

SUMMARY OF REVENUES AT PRESENT RATES

TEST YEAR _______

                   
 

Line

Description

Revenues

Reference

 
 

No.

at Present Rates

 
 

1

Metered Customers

$

 

Sheet I-5, Line 17, Column F

 
 

2

Flat rate customers

   

Sheet I-6, Line 8, Column F

 
 

3

Private fire protection customers

   

Sheet I-4, Line 9, Column I

 
 

4

Other revenues: (describe)

         
           
           
 

5

               
                 
 

6

               
                 
 

7

               
                 
 

8

               
                 
                   

Line No.

Description

Previous Years

 

Revenues

 

See Annual Reports

 
 

Year

           
             

1

Metered Customers

$

$

$

 
 

2

Flat rate customers

           
           

3

Private fire protection customers

           
           
           

4

Other revenues:

           

(describe)

             

5

                 
                 

6

                 
                 

7

                 
                 
       

$

$

$

 
         

Sheet I-2

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF METERED CUSTOMERS BY METER SIZE

TEST YEAR __________

                   
 

A

B

C

D

E

F

G

H

 
                   
     

Number of Customers

     
       

Estimated Test Year Additions

         
 

Line

Meter

End of Prior

End of

Average

Meter

Meter

 
 

No.

Size

Year

Test Year

 

Ratios

Equivalencies

 
                 
     

PUC report Sch. D-4

           
       

(C + D)

[(C + E)/2]

 

(F + G)

 
                 
 

1

5/8" x 3/4"

       

1.0

   
             
 

2

3/4"

       

1.5

   
             
 

3

1"

       

2.5

   
             
 

4

1 1/2"

       

5.0

   
             
 

5

2"

       

8.0

   
             
 

6

               
                 
 

7

               
                 
 

8

               
                 
 

9

Total

             
               
                   
   

Year

____

____

____

____

 
 

10

Number of Customers (end of year)

         
           
 

11

Average number of customers [(prior year + current year)/2]

         
           

Sheet I-3

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF FLAT RATE CUSTOMERS

TEST YEAR __________

                     
 

A

B

C

D

E

F

                     
     

Number of Customers

                     
 

Line

Flat Rate

End of Prior

Test Year

End of

Average

 

No.

Unit

Year

Additions

Year

   
                     
                     
     

PUC report

   

(C + D)

[(C + E)/2]

     

Sch. D-4

           
 

1

                 
                   
 

2

                 
                   
 

3

                 
                   
 

4

                 
                   
 

5

Total

               
                 
                     
   

Year

____

____

____

____

 

6

Number of Customers (end of year)

             
               
 

7

Average number of customers [(prior year + current year)/2]

             
               
               

Sheet I-4

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF PRIVATE FIRE PROTECTION CUSTOMERS

TEST YEAR __________

                   
 

FIRE PROTECTION:

           
                   
 

A

B

C

D

E

F

G

H

I

     

Number of Customers

 

Present Rates

                   
 

Line

Connection

End of Prior

Additions

End of

Average

Annual No.

Rate

Revenues

 

No.

Size

Year

 

Test Year

 

of Bills

per Unit

 
                   
                   
         

(C + D)

[(C + E)/2]

(F x 12)

 

(G x H)

                   
 

1

1"

           

$

           
 

2

1 1/2"

             
             
 

3

2"

             
             
 

4

3"

             
             
 

5

4"

             
             
 

6

6"

             
               
 

7

               
                 
 

8

               
                 
 

9

Total

           

$

             

Sheet I-5

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF METERED REVENUES AT PRESENT RATES

TEST YEAR __________

                 
 

SERVICE CHARGE REVENUE:

         
                 
 

A

B

C

D

E

F

G

 
         

Number of Customers

   
             
 

Line No.

Meter Size

Average

Annual

Service

Service

 
 

No. of

No. of

Charge

Charge

 
 

Customers

Monthly Bills

Rates

Revenue

   
     

Sheet I-2

(C x 12)

 

(D x E)

 
       

 
 

1

5/8" x 3/4"

       

 
           
 

2

3/4"

       

 
           
 

3

1"

       

 
           
 

4

1 1/2"

       

 
           
 

5

2"

       

 
           
 

6

             
               
 

7

             
               
 

8

             
               
 

9

Total

           
             
                 
 

QUANTITY REVENUE:

           
                 
     

Recorded Year

Test Year

   
   

Description

____

____

____

____

Reference

 
 

10

Total water sold (CCF)

       

CPUC rpt

 
         

Sch. D-7

 
 

11

Average number of customers

       

Sheet I-2

 
         

Line 11

 
 

12

Average water sold per customer

       

Average of

 
         

recorded

 
 

(Line 10/Line11)

       

years

 
 

13

Test year average number of customers

       

Sheet I-2

 
         

Col F, Line 9

 
 

14

Test year water sold

       

Lines 12 x 13

 
             
 

15

Quantity rate (CCF)

           
 

(Present rates)

           
 

16

Total quantity revenue (Test year)

       

Lines 14 x 15

 
             
                 
 

17

Total revenues at present rates

       

Column F

 
         

Lines 9 + 16

 

Sheet I-6

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF FLAT RATE REVENUES

TEST YEAR __________

                       
 

A

B

C

D

E

F

 
                       
 

Line

Flat Rate

Average No.

Annual No.

Present Rates

Total

 
 

No.

Unit

of Customers

of Bills

per Unit

Revenues

 
                       
     

Sheet I-3,

(C x 12)

 

(D x E)

 
     

Col. F

     
 

1

             

$

 
                 
 

2

                   
                     
 

3

                   
                     
 

4

                   
                     
 

5

                   
                     
 

6

                   
                     
 

7

                   
                     
 

8

Total

           

$

 
               

II

SECTION II

                   
                   

The purpose of Section II is to allow for the estimation of operating expenses for the test year.

 
 
                   

Instructions for Section II

           
                   
 

Using the three (3) most recent PUC reports (on the PUC annual report Sch. B-2 is the operating expenses) complete columns D, E & F of Sheet II-1.

 
                   
 

Working through Sheets II-2 through II-18, complete each and transfer test year amounts to column G of Sheet II-1.

 
                   
 

Insert and reference additional sheets as necessary. For example, you may wish to use schedules that are more unique to your company.

 

Sheet II-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF OPERATING EXPENSES - TEST YEAR ________

 
                   
 

A

B

C

D

E

F

G

H

 
       

Recorded Year

Test

   
       

____

____

____

Year

   
 

Line

Acct.

Account Name

       

Reference/

 
 

No.

No.

         

Instructions

 
 

1

 

Volumn related expenses:

           
 

2

610

Purchased water

       

Sheet II-3

 
 

3

615

Purchased Power

       

Sheet II-4d

 
               

Lines 7 + 14 + 22

 
 

4

618

Other volume related

       

Sheet II-5

 
     

expenses

           
 

5

 

Total volume related exp.

       

Add lines 2-4

 
 

6

 

Non-volume related expenses

           
 

7

630

Employee labor

       

Sheet II-6

 
 

8

640

Materials

       

Sheet II-7

 
 

9

650

Contract work

       

Sheet II-8

 
 

10

660

Transportation expenses

       

Sheet II-9

 
 

11

664

Other plant maintenance

       

Sheet II-10

 
     

expenses

           
 

12

 

Total non-volume related exp.

       

Add lines 7-11

 
 

13

 

Admin. & general expenses:

           
 

14

670

Office salaries

       

Sheet II-6

 
 

15

671

Mgmt. salaries

       

Sheet II-6

 
 

16

674

Employee pensions &

       

Sheet II-11

 
     

benefits

           
 

17

676

Uncollectible accounts

       

Sheet II-12

 
     

expense

           
 

18

678

Office services & rentals

       

Sheet II-13

 
 

19

681

Office supplies & expenses

       

Sheet II-14

 
 

20

682

Professional services

       

Sheet II-15

 
 

21

684

Insurance

       

Sheet II-16

 
 

22

688

Regulatory commission

       

Sheet II-17

 
     

expense

           
 

23

689

General expenses

       

Sheet II-18

 
 

24

 

Total admin. & general exp.

       

Add lines 14-23

 
 

25

800

Expenses capitalized

           
 

26

 

Net admin. & general expenses

       

Line 24 - Line 25

 
 

27

 

Total operating expenses

       

Lines 5 + 12 + 26

 

Sheet II-2a

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF WATER PRODUCTION

TEST YEAR _______

               
 

WATER PRODUCTION:

         
 

(COMPANIES WITHOUT FLAT RATE CUSTOMERS)

     
               
               
 

Line

Estimated Water

A

B

C

D

E

 

No.

(CCP's)

         
     

Recorded Year

Test

Reference

   

____

____

____

Year

 

1

Total water pumped

       

PUC report

         

Sch. D-1

 

2

Total water purchased

       

PUC report

         

Sch. D-1

 

3

Total water produced & purchased

       

Lines 1 + 2

         
 

4

Total water sold

       

PUC report

         

Sch. D-7

 

5

Total unaccounted for water

       

Lines 3 - 4

         
 

6

Percentage

       

Line 5 / Line 3

         
 

7

Average of recorded years

       

Line 6,

         

Col. A thru C/3

 

8

Total water estimated to be sold

       

Sheet I-5

         

Line 14

 

9

Total water requirements

       

Line 8/(1-Line 7)

         
 

10

Estimated test year water pumped

         
           
 

11

Estimated test year water purchased

         
           
 

12

Total test year water production

         
           

Sheet II-2b

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF WATER PRODUCTION

TEST YEAR _______

               

WATER PRODUCTION:

         

(COMPANIES WITH FLAT RATE CUSTOMERS)

   
               

Line

Description

Recorded Year

Test

Reference

No.

____

____

____

Year

13

           

CPUC rpt Sch. D-1

 

Water Purchased (CCFs)

       
           

14

           

CPUC rpt Sch. D-1

 

Water pumped (CCFs)

       
           

15

           

Lines 13 + 14

 

Total production (CCFs)

       
           

16

 

Average No. of customers

       

Sheet I-2 + I-3

         
         

17

 

Average production per customer

       

Line 15/Line 16

         
         

18

 

Average of recorded years

       

Line 17,

         

Col. A thru C

         

divided by 3

19

 

Total test year water produced

       

Line 16 x 18

         
         

20

 

Est. test year water pumped

         
           
           

21

 

Est. test year water purchased

         
           
           

Sheet II-3

 
 
 
 
             
   

A

B

C

D

 
 

Line

 
 

No.

 
     

Units purchased

     
   

Purchased

(in _______)

Price

Total

 
   

from:

(e.g. CCF's, AC - FT)

Per Unit

(B x C)

 
 

1

         
 

2

         
 

3

         
 

4

Total

*

     
             
 

* Must agree with Sheet II-2, Line 11 or Line 21

     

Sheet II-4a

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

POWER EXPENSE

TEST YEAR _____

                   
                   

1

 

Average number of customers - most recent recorded year

   
                   

2

 

Total ccf pumped - most recent recorded year

     
                   

3

 

Water pumped per customer (in ccf) in recorded year.

     
   

(Divide total water pumped (in ccf) for the recorded year (line 2) by the average number of customers in recorded year (line 1)]

   
       
                   

4

 

Estimated average number of customers - test year

     
                   

5

 

Total water pumped (in ccf) - test year (line 3 x 4)

     
                   

6

 

Grand total KWH - recorded year (from Sheet II-4b, line 29, Col h)

 
                   

7

 

KWH per ccf for the recorded year

       
   

[Divide Grand Total KWH - recorded year (line 6)

     
   

by the Total ccf pumped - recorded year (line 2)]

     
                   

8

 

Total KWH - test year

         
   

[Multiply KWH per ccf - recorded year (line 7)

     
   

by the Total water pumped in ccf - Test Year (line 5)]

     
                   

9

 

Prepare Sheet II-4c to segregate total KWH - test year (line 8)

   
   

among the three power schedules.

       
                   
   

Prepare Sheet II-4d to calculate power costs in dollars for each rate schedule, and combine the three rate schedules to determine the Grand Total Power Expense for the Test Year.

   
       
       
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
 

Note: See also supporting power Sheets II-4b, II-c and II-d.

   

Sheet II-4b

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

POWER SCHEDULE

RECORDED YEAR

                   

(The purpose of SHEET II-4b is to determine, for the most recent recorded year, the percentage of total KWH attributable to each power rate schedule, segregated between winter and summer power rates. The Grand Total KWH from line 28, col g is transferred to SHEET II-4a, line 6.)

                   

Power Schedule A-1

             

A

 

B

C

D

E

F

G

H

I

Line

 

Pump

Winter

Summer

Total

 

No.

 

Location

KWH

 

KWH

 

KWH

 

Percent

1

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

2

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

3

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

4

 

Subtotal

_______

$ ______

_______

$ ______

_______

$ ______

 

5

 

KWH Percent

_______

 

_______

 

_______

   

6

 

Energy Tax

         

$ ______

 

7

 

Customer Charge

         

$ ______

 

8

 

Total

_______

$ ______

_______

$ ______

_______

$ ______

 

9

 

Sched. A-1 KWH as a percent of Grand Total KWH

     

_______

                   

Power Schedule A-1P

             

A

 

B

C

D

E

F

G

H

I

Line

 

Pump

Winter

Summer

Total

 

No.

 

Location

KWH

 

KWH

 

KWH

 

Percent

10

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

11

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

12

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

13

 

Subtotal

_______

$ ______

_______

$ ______

_______

$ ______

 

14

 

KWH Percent

_______

 

_______

 

_______

   

15

 

Energy Tax

         

$ ______

 

16

 

Customer Charge

         

$ ______

 

17

 

Total

_______

$ ______

_______

$ ______

_______

$ ______

 

18

 

Sched. A-1 KWH as a percent of Grand Total KWH

     

_______

                   

Power Schedule A-10

             

A

 

B

C

D

E

F

G

H

I

Line

 

Pump

Winter

Summer

Total

 

No.

 

Location

KWH

 

KWH

 

KWH

 

Percent

19

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

20

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

21

 

________________

_______

$ ______

_______

$ ______

_______

$ ______

 

22

 

Subtotal

_______

$ ______

_______

$ ______

_______

$ ______

 

23

 

KWH Percent

_______

 

_______

 

_______

   

24

 

Energy Tax

         

$ ______

 

25

 

Customer Charge

         

$ ______

 

26

 

Demand Charge

             

27

 

Total

_______

$ ______

_______

$ ______

_______

$ ______

 

28

 

Sched. A-1 KWH as a percent of Grand Total KWH

     

_______

29

 

Grand Total KWH and Dollars - all schedules

   

$ ______

 

30

 

Reconciliation with Recorded Dollar Amounts

   

$ ______

 

Sheet II-4c

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

POWER EXPENSE (By Rate Schedule)

TEST YEAR _______

             

(The purpose of Sheet II-4c is to segregate total KWH for the test year, from Sheet II-4a, line 8, among the three power schedules.)

             

Percentage of Grand Total KWH, by Rate Schedule

     
             

(Multiply by Total KWH, for Test Year (line 1) by percentages on lines 2, 3 and 4, Col C and enter the results in Col D.)

             

A

B

C

 

D

Line

     

Percent

KWH

No.

     

1

Total Estimated KWH for Test Year (from Sheet II-4a, line 8)

     

2

Sched. A-1 (from Sheet II-4b, line 9, Col I)

 

%

 

3

Sched. A-1P (from Sheet II-4b, line 18, Col I)

 

%

 

4

Sched. A-10 (from Sheet II-4b, line 28, Col I)

 

%

 

5

Grand Total (from Sheet II-4b, line 29, Col I)

100

%

 
 

Sheet II-4d

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

POWER EXPENSE (By Power Schedule)

TEST YEAR _______

             
             

Schedule A-1

         

Total KWH, Segregated between Winter and Summer Power Schedules

   
             
 

A

B

C

D

E

 
   

Percent

KWH

Rate Per

Total

 
   

KWH

 

1

Total KWH from Sheet II-4c, line 2, Col D:

       

2

Winter

     

$

 

3

Summer

     

$

 

4

Subtotal

     

$

 

5

Energy Tax

     

$

 

6

Customer Charge

     

$

 

7

Total

     

$

 
             

Schedule A-1P

         

Total KWH, Segregated between Winter and Summer Power Schedules

   
             
 

A

B

C

D

E

 
   

Percent

KWH

Rate Per

Total

 
   

KWH

 

8

Total KWH from Schedule II-4c, line 3, Col D:

     

9

Winter

     

$

 

10

Summer

     

$

 

11

Subtotal

     

$

 

12

Energy Tax

     

$

 

13

Customer Charge

     

$

 

14

Total

     

$

 
             

Schedule A-10

         

Total KWH, Segregated between Winter and Summer Power Schedules

   
             
 

A

B

C

D

E

 
   

Percent

KWH

Rate Per

Total

 
   

KWH

 

15

Total KWH from Schedule II-4c, line 4, Col D:

     

16

Winter

     

$

 

17

Summer

     

$

 

18

Subtotal

     

$

 

19

Energy Tax

     

$

 

20

Customer Charge

     

$

 

21

Demand Charge

     

$

 

22

Total

     

$

 
             

23

Grand Total - Power Cost - All Schedules

   

__________KWH

Sheet II-5

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

       
                 

Line No.

Account No.

Account Name

     
                 

4

 

618

 

Other volume related expenses

 
                 
                 

Other volume related expenses

         
                 

List the amount spent on other volume related expenses for the last three record periods and estimated for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year _______

$ ____________________

     

Sheet II-6

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF PAYROLL COSTS AND EXPENSES

TEST YEAR _______

                         
                         

SEE GENERAL ORDER NUMBER 77 PARTS H AND G SOME SALARIES MUST BE FILED IN THIS REPORT

 

ESTIMATE OF PAYROLL COSTS:

                 
                         
       

A

B

C

D

E

F

G

H

 
 

Line

Employee

Test Year

Capitalized

Expensed

1st

7,001 to

55,501 to

Over

Total

 
 

No.

Name

Payroll

Payroll

Payroll

7,000

55,500

130,200

130,200

Payroll

 
 

1

                     
                       
 

2

                     
                       
 

3

                     
                       
 

4

                     
                       
 

5

                     
                       
 

6

                     
                       
 

7

                     
                       
 

8

                     
                       
 

9

 

Total

                 
                     
                         
 

ALLOCATION OF PAYROLL TO EXPENSE:

             
                         
 

Line

Acct

Account Name

Test Year

           
 

No.

No.

Expense

           
 

10

630

Employee labor

                 
                   
 

11

670

Officer salaries

                 
                   
 

12

671

Management salaries

                 
                   
 

13

 

Total Payroll Expenses

                 
                     

Sheet II-7

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

         
                 

Line No.

 

Account No.

Account Name

     
                 

8

 

640

 

Materials

     
                 

Materials

             
                 

List the amount spent on materials for the last three record periods and estimated for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year __________

 

$ ____________________

     

Sheet II-8

This page is supplemental information. It is required to complete Sheet II-1.

               

References below refer to Sheet II-1.

       
               

Line No.

 

Account No.

Account Name

   
               

9

 

650

 

Contract work

   
               

Contract work

           
               

List the amount spent on contract work for the last three record periods and estimated for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the aniticipated increase:

               

Year

 

Amount

     
               

__________

 

$ ____________________

   
               

__________

 

$ ____________________

   
               

__________

 

$ ____________________

   
               

Test Year __________

 

$ ____________________

   

Sheet II-9

This page is supplemental information. It is required to complete Sheet II-1.

         

References below refer to Sheet II-1.

         

Line No.

 

Account No.

Account Name

         

10

 

660

 

Transportation expense

         

Transportation expense

   
         

List the type of vehicles used by the water company and allocate the percent

used for business purposes. For example, is there one vehicle used solely for

the Water Company, or is it used for non-business activities too? Is there a

vehicle involved that is part of the Company's Plant in Service and thus is

already depreciated?

   
         

Vehicle expenses reported using a cost per unit (say 27 cents per mile)

probably have the depreciation factor included. A vehicle which is part of

the Plant in Service should show only actual operating and maintenance

expenses (oil, gas, repairs, maintenance) excluding insurance. The purpose

of this supplemental page is to ensure that vehicle expense will be recorded

property and that vehicle depreciation is not listed twice or totally omitted.

         

Year

 

Amount

         

__________

 

$ ____________________

         

__________

 

$ ____________________

         

__________

 

$ ____________________

         

Test Year __________

$ ____________________

Sheet II-10

This page is supplemental information. It is required to complete Sheet II-1.

         

References below refer to Sheet II-1.

 
         

Line No.

 

Account No.

Account Name

         

11

 

664

 

Other plant maintenance

         

Other plant maintenance

   
         

List the amount spent on other plant maintenance for the last three record periods

and estimated for the Test Year. Indicate the kinds of expenses included in this

account by identifying all large items. If the estimate for the Test Year is higher

than previous years, indicate the reason for the anticipated increase:

         
         

Year

 

Amount

         

__________

 

$ ____________________

         

__________

 

$ ____________________

         

__________

 

$ ____________________

         

Test Year __________

$ ____________________

         

Large Items:

     

Sheet II-11

This page is supplemental information. It is required to complete Sheet II-1.

           

References below refer to Sheet II-1.

     
           

Line No.

Account No.

Account Name

   
           

16

674

Employee pensions and benefits

           

Employee pensions and benefits

     
           

List the amount spent on Employee's pensions and benefits for the last three record periods and estimate for

the Test Year. Indicate the kinds of expenses included in this account by identifying all items by category.

For example, Pensions includes such items as ESOPs and IRAs. The "Other" column includes such items as

dental, vision, life insurance, etc. Also include the number of employees covered and charged to account 674

and indicate the cost per employee. If the estimate for the Test Year is higher than previous years, indicate

the reason for the anticipated increase:

     
           

List types of Pensions & Benefits:

     
           

_______

 

$ __________

$__________

$__________

$__________

Year

 

Total Amount

Pensions

Health

Other

           

Number of Employees covered: __________

   
           

Cost per Employee: __________

     
           
           

List types of Pensions & Benefits:

     
           

_______

 

$ __________

$__________

$__________

$__________

Year

 

Total Amount

Pensions

Health

Other

           

Number of Employees covered: __________

   
           

Cost per Employee: __________

     
           
           

List types of Pensions & Benefits:

     
           

_______

 

$ __________

$__________

$__________

$__________

Year

 

Total Amount

Pensions

Health

Other

           

Number of Employees covered: __________

   
           

Cost per Employee: __________

     
           
           

List types of Pensions & Benefits:

     
           

_______

 

$ __________

$__________

$__________

$__________

Year

 

Total Amount

Pensions

Health

Other

           

Number of Employees covered: __________

   
           

Cost per Employee: __________

     

Sheet II-12

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

       
                 

Line No.

 

Account No.

Account Name

     
                 

17

 

676

 

Uncollectibles

     
                 

Uncollectibles

             
                 

List the recorded amount the company was unable to collect for the last three years, and estimate the uncollectible amount for the Test Year. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase.

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year __________

$ ____________________

     

Sheet II-13

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

       
                 

Line No.

 

Account No.

Account Name

     
                 

18

 

678

 

Office services & rentals

   
                 

Office services & rentals

           
                 

List the amount spent on office services and rentals for the last three record periods and estimate for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year __________

$ ____________________

     
                 

Large Items:

             

Sheet II-14

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

       
                 

Line No.

 

Account No.

Account Name

     
                 

19

 

681

 

Office supplies & expenses

 
                 

Office supplies & expenses

         
                 

List the amount spent on office supplies and expenses for the last three record periods and estimate for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year __________

$ ____________________

     
                 

Large Items:

             

Sheet II-15

This page is supplemental information. It is required to complete Sheet II-1.

                 

References below refer to Sheet II-1.

       
                 

Line No.

 

Account No.

Account Name

     
                 

20

 

682

 

Professional services

   
                 

Professional services

           
                 

List the amount spent on professional services for the last three record periods and estimate for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                 

Year

 

Amount

       
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

__________

 

$ ____________________

     
                 

Test Year __________

$ ____________________

     
                 

Large Items:

             

Sheet II-16

This page is supplemental information. It is required to complete Sheet II-1.

                   

References below refer to Sheet II-1.

         
                   

Line No.

Account No.

Account Name

       
                   

21

 

684

 

Insurance

       
                   

Insurance

               
                   

List the amount spent on each insurance policy by indicating the cost, period covered, type of coverage, and the insurance company's name for the last record period and the Test Year. For "type", indicate fire, theft, liability, worker's compensation, vehicle, etc. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 
                   
                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 
                   
                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 
                   
                   

Test Year

               
                   
                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 
                   
                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 
                   
                   

Year

 

Total amount

 

Period Covered

 

Type

 

Company

 

Sheet II-17

This page is supplemental information. It is required to complete Sheet II-1.

                   

References below refer to Sheet II-1.

         
                   

Line No.

 

Account No.

Account Name

       
                   

22

 

688

 

Regulatory commission expense

   
                   

Regulatory commission expense

           
                   

List the amount spent on regulatory commission expense for the last three record periods and estimate for the Test Year. Do not include Public Utilities Commission Reimbursement Fees (User Fees). This section is to record Commission filing fees or fees to consultants, attorneys, etc. in formal and informal rate cases, complaints, or other dealings with the Commission, which are not reported under Professional Services. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                   

Year

 

Amount

         
                   

__________

 

$ ____________________

       
                   

__________

 

$ ____________________

       
                   

__________

 

$ ____________________

       
                   

Test Year __________

$ ____________________

       
                   

Large Items:

               

Sheet II-18

This page is supplemental information. It is required to complete Sheet II-1.

                   

References below refer to Sheet II-1.

         
                   

Line No.

 

Account No.

Account Name

       
                   

23

 

689

 

General expense

     
                   

General expense

             
                   

List the amount spent on general expense for the last three record periods and estimate for the Test Year. Indicate the kinds of expenses included in this account by identifying all large items. If the estimate for the Test Year is higher than previous years, indicate the reason for the anticipated increase:

                   

Year

 

Amount

         
                   

__________

 

$ ____________________

       
                   

__________

 

$ ____________________

       
                   

__________

 

$ ____________________

       
                   

Test Year __________

$ ____________________

       
                   

Large Items:

               

III

SECTION III

                   
                   

Section III provides working tables to allow the calculation of estimated rate base and return on rate base.

 
 
                   
                   

Instructions for Section III

           
                   
 

Complete Sheets III-3 through III-9 as they apply to your company.

                   
 

Transfer the resulting average balances (last line of each table) to Sheet III-2.

                   
 

Complete Line 1 of Sheet III-1 using Line 16 of Sheet III-2. If your company has long term debt, complete lines 4-7 of Sheet III-1. If there is no long term debt for your company, your rate of return range is dependent on D.92-03-093.

 

Sheet III-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

REQUESTED RETURN

TEST YEAR __________

 

Return on Rate Base:

           
                     
 

Line

Description

Test Year

 
 

No.

Amount

 
 

1

 

Average rate base (from III-2)

       
           
 

2

 

Requested rate of return (see below)

       
           
 

3

 

Return on rate base (Line 1 x Line 2)

       
           
                     
 

Rate of Return:

             
                     
 

(Note:

If the Company has no long term debt, do not complete the schedule below. The rate of return on Line 2 will equal to the return on equity that the Company is requesting. Therefore, put that amount on Line 2.)

 
                     
 

A

B

C

D

E

F

G

 

Line No.

Description

Amount

Percentage

Rate

Reference

Weighted

 

Average

 

Rate

             

Amount from previous column divided by Line 6, Column C

   

(D x E)

                 
                 
 

4

 

Equity

         

Requested return on equity

 
   

(Line 6, Sch. A of

         
   

latest PUC report)

$

%

%

%

 

5

 

Long Term Debt and

     

Average rate on debt

 
   

Advances from

         
   

Associated Companies

       
   

PUC Report Sched. A,

       
   

Liabilities Section

   

%

%

%

 

6

 

Total capitalization (Line 4 + Line 5)

         
             
   

$

100%

   

%

 

7

 

Return on rate base

         
   

(rounded to

           
   

nearest 0.1%)

         

%

                     
 

* ROE = Return on Equity

         

Sheet III-2

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATED RATE BASE

TEST YEAR __________

           
 

AVERAGE RATE BASE FOR THE TEST YEAR __________

   
           
 

Line

Description

Amount

Reference

 
 

No.

 
 

1

Additions:

     
       
 

2

Utility plant

$

Sheet III-3,

 
   

Line 23

 
 

3

Construction work in progress

 

Sheet III-4,

 
   

Line 5

 
 

4

Materials and supplies

 

Sheet III-4,

 
   

Line 8

 
 

5

Working cash

 

Sheet III-5

 
     
 

6

       
       
 

7

TOTAL ADDITIONS (Add Lines 2 through 6)

$

   
     
 

8

Deductions:

     
       
 

9

Reserve for depreciation

$

Sheet III-7,

 
 

Line 8

 
 

10

Contributions in aid of construction

 

Sheet III-8,

 
   

Line 12

 
 

11

Advances for construction

 

Sheet III-8,

 
   

Line 6

 
 

12

Accumulated deferred income taxes

 

Sheet III-9,

 
   

Line 4

 
 

13

Accumulated deferred investment tax credits

 

Sheet III-9,

 
   

Line 8

 
 

14

       
       
 

15

TOTAL DEDUCTIONS (Add Lines 9 through 14)

$

   
     
 

16

AVERAGE RATE BASE (Line 7, less Line 15)

$

   
     

Sheet III-3

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF AVERAGE UTILITY PLANT

TEST YEAR __________

           
 

AVERAGE UTILITY PLANT:

     
           
 

A

B

C

D

 
 

Line

Description

Amount

Amount

 
 

No.

 
 

1

Beginning balance

     
   
 

2

Test year plant additions:

     
   
 

3

 

$

   
     
 

4

       
   
 

5

       
   
 

6

       
   
 

7

       
   
 

8

       
   
 

9

       
   
 

10

       
         
 

11

Total additions

 

$

 
 

(Add Lines 3 through 10, Col. C)

     
 

12

Test year plant retirements:

     
       
 

13

 

$

   
     
 

14

       
   
 

15

       
   
 

16

       
   
 

17

       
   
 

18

       
   
 

19

       
   
 

20

       
   
 

21

Total retirements

 

$

 
 

(Add Lines 13 through 20, Col. C)

     
 

22

Ending balance

 

$

 
 

(Line 1 = Line 11 - Line 21)

     
 

23

Average balance - test year

 

$

 
 

(Line 1 plus Line 22, divided by 2)

     

Sheet III-4

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF AVERAGE CONSTRUCTION WORK IN PROGRESS AND

AVERAGE MATERIALS AND SUPPLIES INVENTORY

TEST YEAR __________

         
 

AVERAGE CONSTRUCTION WORK IN PROGRESS:

 
         
 

A

B

C

 
 

Line

Description

Test Year

 
 

No.

Amount

 
 

1

Beginning balance

   
     
 

2

Test year costs added

   
     
 

3

Test year construction costs completed

( )

 
   
 

4

Ending balance

   
     
 

5

Average balance - test year

   
 

(Line 1 plus Line 4 divided by 2)

   
         
         
 

AVERAGE MATERIALS AND SUPPLIES INVENTORY:

 
         
 

6

Beginning balance

   
     
 

7

Estimated ending blanace

   
     
 

8

Average balance - test year

   
 

(Line 6 plus Line 7, divided by 2)

   

Sheet III-5

WORKING CASH ALLOWANCE CALCULATIONS

 

FOR

 

SMALL WATER UTILITIES

 
               
               

1. No working cash allowance is permitted when a utility bills its customers in advance and provides service to flat rate customers only.

               

2. A utility which has all metered customers and bills monthly shall divide its annual Operating and Maintenance (O&M) expenses (excluding all taxes and depreciation) by 12 to compute its working cash as shown in the following example:

               
 

1.

Annual Expenses

   

$70,000

   
 

2.

Taxes and depreciation

 

(10,000)

   
 

3.

Net Expenses (Line 1 - Line 2)

60,000

   
 

4.

Working Cash (Line 3 divided by 12)

$5,000

   
               

3. If the utility bills its metered customers on a bi-monthly basis, the above expenses shown on Line 3 should be divided by six resulting in a working cash allowance of $10,000.

4. An appropriate allocation of operating and maintenance expense should be applied when a utility has a mixture of metered and flat rate customers.

Sheet III-6

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATED DEPRECIATION

TEST YEAR __________

         
         
         

Depreciation at the rate of _______% is calculated on the ____________ depreciable

utility plant balance. (beginning or average)

         
         

A

B

C

D

E

Line

Description

Beginning

End

Average

No.

Year

Year

       

(C + D / 2)

1

Total utility plant:

$

$

$

2

Less:

     
     

3

Land

( )

 

( )

4

Intangibles

( )

 

( )

5

 

( )

 

( )

   

6

Depreciable balance

     

(Line 1 less Lines 3, 4,

     

and 5)

     

7

Depreciation rate

%

 

%

 

8

Test year Depreciation

     

(Line 6 x Line 7)

     

9

Contributions in aid

     

of construction

     

10

Depreciation on

( )

 

( )

contributions

 

(Line 7 x Line 9)

 

11

Test year

     

depreciation expense

     

(Line 8 less Line 10)

     

Sheet III-7

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATED AVERAGE ACCUMULATED FOR DEPRECIATION

TEST YEAR __________

     
     

AVERAGE ACCUMULATED DEPRECIATION:

     
     

Line

Description

Test Year

No.

 

Amount

1

Beginning balance

 
 

2

Test year depreciation

 

(Sheet III-6, Line 11)

 

3

Test year depreciation

( )

(Sheet III-3, Line 21)

4

Test year salvage value

( )

received **

5

Test year cost of removal

( )

6

Test year other adjustments

 
 

7

Ending balance

 

(Add Lines 1 through 6)

 

8

Average balance - test year

 

(Line 1 plus Line 7, divided by 2)

 
     

** MONEY RECEIVED FOR SOLD VEHICLES, PUMPS, METERS, ETC.

Sheet III-8

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATED AVERAGE ADVANCES FOR CONSTRUCITON AND

ESTIMATED AVERAGE CONTRIBUTIONS IN AID OF CONSTRUCTION

TEST YEAR __________

             

ESTIMATED AVERAGE ADVANCES FOR CONSTRUCTION:

   
             

Line

Description

Test Year

 

No.

Amount

 

1

Beginning balance

 

$

     

2

Test year additions

         

3

Test year refunds

 

( )

 

4

Other adjustments

         

5

Ending Balance

         

6

Average balance - test year

         

(Line 1 plus Line 5, divided by 2)

 

$

     
             
             

ESTIMATED AVERAGE CONTRIBUTONS IN AID OF CONSTRUCITON:

 
             

A

B

C

D

E

 

Line

Description

Amount

Amortization

Net

 

No.

           

7

Begining balance - test year

$

$( )

$

 
 

8

Test year additions

       
 

9

Test year amortization

 

( )

( )

 

(Sheet III-7, Line 8)

 

10

Test year other adjustments

       
 

11

Ending blance - test year

 

( )

   
 

12

Average balance - test year

   

$

 

(Line 7 plus Line 11, divided by 2)

 

Sheet III-9

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF AVERAGE DEFERRED INCOME TAXES AND

AVERAGE DEFERRED INVESTMENT TAX CREDITS

TEST YEAR __________

     
     

AVERAGE DEFERRED INCOME TAXES:

     

Line

Description

Test Year

No.

Amount

1

Beginning balance

 
 

2

Test year additions

 
 

3

Ending balanace

 
 

4

Average Balance - test year

 

(Line 1 plus Line 3, divided by 2)

 
     
     
     

AVERAGE DEFERRED INVESTMENT TAX CREDITS:

     

5

Beginning balance

 
 

6

Test year amortization

 
 

7

Ending balance

 
 

8

Average balance - test year

 

(Line 5 plus Line 7, divided by 2)

 

IV

SECTION IV

           
           

Section IV is used to estimate taxes other than income.

           
           

Instructions for Section IV

     
           

Follow the instructions included with tables under the

heading reference.

     

Sheet IV-1a

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF TAXES OTHER THAN INCOME

TEST YEAR __________

                   
                   

PROPERTY TAXES:

               
                   

A

B

C

D

E

Line

Description

Amount

Amount

Reference

No.

1

Property taxes paid in year prior to test year

       

per property tax bills

       

2

Utility plant added in test year

       

Sheet III-3, Line 11

       

3

Utility plant added in year prior to test year

       

PUC report

 
       

Sch A-1a, Line 11

4

Utility plant retirements in test year

( )

   

Sheet III-3, Line 21

   

5

Utility plant retirements in year prior

( )

   

PUC report

 

to test year

     

Sch A-1, Line 6

6

Average net additions

       

Line 2 + 3 - 4 - 5

       

divided by 2

 

7

Property tax rate

%

   

Per latest property tax bill

   

8

Test year property tax on additions

       

Line 6 times Line 7

       

9

Increase in prior year property taxes

       

Line 1 times 102%

       

10

Test year property tax expense

       

(Line 1 + Line 9,

       

divided by 2) + Line 8

                   

PAYROLL TAXES:

               
                   

A

B

C

D

E

F

G

Line

Tax Type

Wage

Tax

Taxable

Reference

Tax

No.

 

Level

Rate

Wages

       
           

Sheet II-6

(D x E)

11

FICA

wages to _____

%

   

Lines

   

$

 

D + E

   

12

Medicare

wages to _____

%

   

Lines

   
   

D + E + F

   

13

Federal unemployment

wages to _____

%

   

Line D

   
       

14

State unemployment

wages to _____

%

   

Line D

   
       

15

State employment training

wages to _____

%

   

Line D

   
       

16

Total

               

(add Lines 11 through 15)

   

$

     

$

 

Sheet IV-1b

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

ESTIMATE OF TAXES OTHER THAN INCOME

TEST YEAR __________

(CONTINUED)

               
               

PAYROLL TAXES:

           
               

H

I

J

K

L

M

   

Recorded Year

Test Year

Line

Description

         

No.

           

17

Other taxes and licenses

$

$

$

$

               
               

18

Total taxes other than income

         

(Line 10 + Line 16, Column G + Line 17, Column M)

   

$

 

V

SECTION V

             
             

Section V summarizes results of operations at present rates.

             
             

Instrucitons for Section V

       
             

Complete Sheet V-1 and Sheet V-2 per instructions found

in the reference column.

       

Sheet V-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

INCOME TAXES AT PRESENT RATES

TEST YEAR __________

           

A

B

C

D

E

F

Line

Description

Federal

California

Total

Reference

No.

1

Revenues

$

$

 

Sheet I-1, Line 8

 

2

Less:

       
       

3

Operating expenses

( )

( )

 

Sheet II-1, Line 27,

 

Column G

4

Depreciation

( )

( )

 

Sheet III-7, Line 8

 

5

Taxes other than income

( )

( )

 

Sheet IV-1,

 

Line 10 + Line 17

6

California franchise tax

( )

   

Column D, Line 12

   

7

Interest expense

( )

( )

   
   
           

8

Depreciation on

( )

( )

   

taxed contributions

   
           

9

         
     

10

Taxable income

       
     

11

Tax rate

(see below)

9.3% but not less

   

than $800

   

12

Tax at present rates

$

$

$

 
 
           

FEDERAL INCOME TAX CALCULATION:

     
           

Line

Tax Rate

Taxable Income

Tax Rate

Tax

 

No.

         
   

(Portion of Taxable

 

(C x D)

 
   

Income in Level)

     

13

1st 50,000 of taxable income

$

15%

$

 
 

14

Next 25,000 of taxable income

 

25%

   
   

15

Next 25,000 of taxable income

 

34%

   
   

16

Next 235,000 of taxable income

 

39%

   
   

17

Over 335,000 of taxable income

 

34%

   
   

18

Total

   

$

 
   

Sheet V-2

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

SUMMARY OF EARNINGS

TEST YEAR __________

           
           
 

A

B

C

 

Line

Item

Utility Estimated

 

No.

Present Rates

Reference

 
   

OPERATING REVENUES

     

1

460

Flat rates

     

2

470

Metered rates

     

3

462

Private Fire Protection

     

4

 

TOTAL REVENUE

 

Sheet VI-1, Line 6, col. C

 

5

 

OPERATING EXPENSES

     

6

610

Purchased water

 

Sheet II-1, Line 2, col. G

 

7

615

Purchased power

 

Sheet II-1, Line 3, col. G

 

8

618

Other volume related expenses

 

Sheet II-1, Line 4, col. G

 

9

630

Employee labor

 

Sheet II-1, Line 7, col. G

 

10

640

Materials

 

Sheet II-1, Line 8, col. G

 

11

650

Contract work

 

Sheet II-1, Line 9, col. G

 

12

660

Transportation expense

 

Sheet II-1, Line 10, col. G

 

13

664

Other plant maintenance

 

Sheet II-1, Line 11, col. G

 

14

670

Office salaries

 

Sheet II-1, Line 14, col. G

 

15

671

Management salaries

 

Sheet II-1, Line 15, col. G

 

16

674

Empoyee pensions and benefits

 

Sheet II-1, Line 16, col. G

 

17

674

Uncollectible

 

Sheet II-1, Line 17, col. G

 

18

678

Office services and rentals

 

Sheet II-1, Line 18, col. G

 

19

681

Office supplies and expenses

 

Sheet II-1, Line 19, col. G

 

20

682

Professional services

 

Sheet II-1, Line 20, col. G

 

21

684

Insurance

 

Sheet II-1, Line 21, col. G

 

22

688

Regulatory Commission Expenses

 

Sheet II-1, Line 22, col. G

 

23

689

General expenses

 

Sheet II-1, Line 23, col. G

 

24

 

SUBTOTAL

     

25

403

Depreciation

 

Sheet III-7, Line 8

 

26

408

Taxes other than income

 

Sheet IV-1b, Line 17

 

27

409/10

Income taxes

 

Sheet V-1, Line 12, col. E

 

28

TOTAL DEDUCTIONS

 

Line 25 + Line 26 + Line 27

 

29

NET REVENUE

 

Line 24 less Line 28

 

30

RATE BASE

 

Sheet III-2, Line 16

 

31

RATE OF RETURN

 

Line 29 divided by Line 30

 

VI

SECTION VI

               
               
 

Section IV develops proposed gross revenue.

     
               
               
               
 

Instructions for Section VI:

         
               
 

1

Complete Lines 1-4 of Sheet VI-1 first.

     
               
 

2

Depending on your projected income tax rate complete the appropriate

   

income tax Sheet VI-2 a-d.

         
               
 

3

Complete lines 5 and 6 of Sheet VI-1

     
               
 

4

Complete Sheet VI-3

         

Sheet VI-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

SCHEDULE OF REVENUE REQUIREMENTS

TEST YEAR __________

       
       

A

B

C

D

Line

Description

Amount

Reference

No.

1

Operating expenses

$

Sheet II-1

Line 27, Col. G

2

Depreciation (average)

 

Sheet III-6

Line 11

3

Taxes other than income

 

Sheet IV-1b

Line 17

4

Income taxes at proposed rates

 

Sheet VI-3

Line 12, Col. E

5

Return requested

 

Sheet III-1

Line 3

6

Total revenue requirements

$

 
 

Sheet VI-2a

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

NET TO GROSS FORMULA

TEST YEAR __________

           

The following formula will compute the gross revenues needed based upon the ruturn requested. The formula assumes a marginal federal tax rate of 15% and a state tax of 9.3% (but more than the $800 minimum tax):

           
 

G = (1/(1 - b))[O - .297101I - .194565C(f) - .102536C(s) + 1.297101N]

   
           

Where,

       

G

= Gross revenue

       

b

= Bad debt %

       

O

= Operating expenses, depreciation and taxes other than income

   

I

= Interest expense

       

C(f)

= Depreciation on taxed contributions for federal purposes

     

C(s)

= Depreciation on taxed contributions for state purposes

     

N

= Net return requested

       
           

A

B

C

D

E

F

Line

Description

Amount

Factor

(C x D)

Reference

No.

Total

1

Operating expenses, depreciation and taxes other than income

 

1.000000

 

Sheet V-1

   

Lines 3-5

2

Interest expense

 

-0.297101

   
     

3

Depreciation on taxed contributons (Federal)

 

-0.194565

   
     

4

Depreciation on taxed contributons (California)

 

-0.102536

   
     

5

Net return requested

 

1.297101

   
     

6

         
 

7

Total

     

Total of Col E

 

Lines 1-5

8

     

1.0000

 

9

Bad debt rate (e.g. 1% = .01)

       
   

10

       

Line 8 - Line 9

 

11

Gross revenue

     

Line 7 divided by 10

 
 

Proof:

       
         

12

Gross revenue

     

Line 11, Col. E

     

13

Expenses:

       

14

Operating expenses, depreciaton, and

     

Line 1, Col. C

taxes other than income

     

15

Bad debts

     

Line 9, Col. E

     

times Line 12

16

Federal income tax

       
       

17

California income tax

       
       

18

Total expenses

     

Total of Col. E

     

Lines 14 - 17

19

Net return

     

Line 12 - Line 18

     

Sheet VI-2b

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

NET TO GROSS FORMULA

TEST YEAR __________

           

The following formula will compute the gross revenues needed based upon the ruturn requested. The formula assumes a marginal federal tax rate of 25% (15% for 1st $50,000 of taxable income and 25% for the next $25,000) and a state tax of 9.3% (but more than the $800 minimum tax):

           
 

G = (1/(1 - b))[O - .470048I - .367512C(f) - .102536C(s) + 1.470048N - 7,350]

   
           

Where,

       

G

= Gross revenue

       

b

= Bad debt %

       

O

= Operating expenses, depreciation and taxes other than income

   

I

= Interest expense

       

C(f)

= Depreciation on taxed contributions for federal purposes

     

C(s)

= Depreciation on taxed contributions for state purposes

     

N

= Net return requested

       
           

A

B

C

D

E

F

Line

Description

Amount

Factor

(C x D)

Reference

No.

Total

1

Operating expenses, depreciation and taxes other than income

 

1.000000

 

Sheet V-1

   

Lines 3-5

2

Interest expense

 

-0.470048

   
     

3

Depreciation on taxed contributons (Federal)

 

-0.367512

   
     

4

Depreciation on taxed contributons (California)

 

-0.102536

   
     

5

Net return requested

 

1.470048

   
     

6

         
 

7

Total

     

Total of Col E

 

Lines 1-5

8

     

-7,350

 

9

Bad debt rate (e.g. 1% = .01)

       
   

10

       

Line 8 - Line 9

 

11

Gross revenue

     

Line 7 divided by 10

 
 

Proof:

       
         

11

Gross revenue

     

Line 11, Col. E

     

13

Expenses:

       

14

Operating expenses, depreciaton, and

     

Line 1, Col. C

taxes other than income

     

15

Bad debts

     

Line 9, Col. E

     

times Line 12

16

Federal income tax

       
       

17

California income tax

       
       

18

Total expenses

     

Total of Col. E

     

Lines 14 - 17

19

Net return

     

Line 12 - Line 18

     

Sheet VI-2c

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

NET TO GROSS FORMULA

TEST YEAR __________

           

The following formula will compute the gross revenues needed based upon the ruturn requested. The formula assumes a marginal federal tax rate of 34% (15% for 1st $50,000 of taxable income; 25% for the next $25,000; 34% for the next $25,000) and a state tax of 9.3% (but more than the $800 minimum tax):

           
 

G = (1/(1 - b))[O - .670509I - .567973C(f) - .102536C(s) + 1.670509N - 19,628]

 
           

Where,

       

G

= Gross revenue

       

b

= Bad debt %

       

O

= Operating expenses, depreciation and taxes other than income

   

I

= Interest expense

       

C(f)

= Depreciation on taxed contributions for federal purposes

     

C(s)

= Depreciation on taxed contributions for state purposes

     

N

= Net return requested

       
           

A

B

C

D

E

F

Line

Description

Amount

Factor

(C x D)

Reference

No.

Total

1

Operating expenses, depreciation and taxes other than income

 

1.000000

 

Sheet V-1

   

Lines 3-5

2

Interest expense

 

-0.670509

   
     

3

Depreciation on taxed contributons (Federal)

 

-0.567973

   
     

4

Depreciation on taxed contributons (California)

 

-0.102536

   
     

5

Net return requested

 

1.670509

   
     

6

     

-19,628

 
 

7

Total

     

Total of Col E

 

Lines 1-5

8

     

1.0000

 

9

Bad debt rate (e.g. 1% = .01)

       
   

10

       

Line 8 - Line 9

 

11

Gross revenue

     

Line 7 divided by 10

 
 

Proof:

       
         

11

Gross revenue

     

Line 11, Col. E

     

13

Expenses:

       

14

Operating expenses, depreciaton, and

     

Line 1, Col. C

taxes other than income

     

15

Bad debts

     

Line 9, Col. E

     

times Line 12

16

Federal income tax

       
       

17

California income tax

       
       

18

Total expenses

     

Total of Col. E

     

Lines 14 - 17

19

Net return

     

Line 12 - Line 18

     

Sheet VI-2d

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

NET TO GROSS FORMULA

TEST YEAR __________

           

The following formula will compute the gross revenues needed based upon the ruturn requested. The formula assumes a marginal federal tax rate of 39% (i.e. federal taxable income between $100,000 and $335,000) and a state tax of 9.3% (but more than the $800 minimum tax):

           
 

G = (1/(1 - b))[O - .807436I - .7049C(f) - .102536C(s) - 1.807436N - 30,275]

   
           

Where,

       

G

= Gross revenue

       

b

= Bad debt %

       

O

= Operating expenses, depreciation and taxes other than income

   

I

= Interest expense

       

C(f)

= Depreciation on taxed contributions for federal purposes

     

C(s)

= Depreciation on taxed contributions for state purposes

     

N

= Net return requested

       
           

A

B

C

D

E

F

Line

Description

Amount

Factor

(C x D)

Reference

No.

Total

1

Operating expenses, depreciation and taxes other than income

 

1.000000

 

Sheet V-1

   

Lines 3-5

2

Interest expense

 

-0.807436

   
     

3

Depreciation on taxed contributons (Federal)

 

-0.7049

   
     

4

Depreciation on taxed contributons (California)

 

-0.102536

   
     

5

Net return requested

 

1.807436

   
     

6

     

30,275

 
 

7

Total

     

Total of Col E

 

Lines 1-5

8

     

1.0000

 

9

Bad debt rate (e.g. 1% = .01)

       
   

10

       

Line 8 - Line 9

 

11

Gross revenue

     

Line 7 divided by 10

 
 

Proof:

       
         

11

Gross revenue

     

Line 11, Col. E

     

13

Expenses:

       

14

Operating expenses, depreciaton, and

     

Line 1, Col. C

taxes other than income

     

15

Bad debts

     

Line 9, Col. E

     

times Line 12

16

Federal income tax

       
       

17

California income tax

       
       

18

Total expenses

     

Total of Col. E

     

Lines 14 - 17

19

Net return

     

Line 12 - Line 18

     

Sheet VI-3

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

INCOME TAXES AT PROPOSED RATES

TEST YEAR __________

           

A

B

C

D

E

F

Line

Description

Federal

California

Total

Reference

No.

         

1

Revenues

$

$

 

Sheet VI-1, Line 6

 

2

Less:

       
       

3

Operating expenses

( )

( )

 

Sheet II-1, Line 27,

 

Column G

4

Depreciation

( )

( )

 

Sheet III-7, Line 8

 

5

Taxes other than income

( )

( )

 

Sheet IV-1b, Line 17

 

6

California franchise tax

( )

   

Column D, Line 12

   

7

Interest expense

( )

( )

   
   
           

8

Depreciation on

( )

( )

   

taxed contributions

   
           

9

         
     

10

Taxable income

       
     

11

Tax rate

(see below)

9.3% but not less

   

than $800

   

12

Tax at present rates

$

$

$

 
 
           

FEDERAL INCOME TAX CALCULATION:

     
           

Line

Tax Rate

Taxable Income

Tax Rate

Tax

 

No.

         
   

(Portion of Taxable

 

(C x D)

 
   

Income in Level)

     

13

1st 50,000 of taxable income

$

15%

$

 
 

14

Next 25,000 of taxable income

 

25%

   
   

15

Next 25,000 of taxable income

 

34%

   
   

16

Next 235,000 of taxable income

 

39%

   
   

17

Over 335,000 of taxable income

 

34%

   
   

18

Total

   

$

 
   

VII

SECTION VII

                 
                 
 

Section VII is used to show the summary of earnings at proposed rates.

                 
                 
 

Instructions for Section VII:

         
                 
 

Complete Sheet VII-1

         

SheetVII-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE

SUMMARY OF EARNINGS

TEST YEAR __________

           
           
 

A

B

C

D

Line

Item

Present Rates

Utility Estimated

No.

From Sheet V-2

Proposed rates

Reference

   

OPERATING REVENUES

     

1

460

Flat rates

     

2

470

Metered rates

     

3

462

Private Fire Protection

     

4

 

TOTAL REVENUE

   

Sheet VI-1, Line 6, col. C

5

 

OPERATING EXPENSES

     

6

610

Purchased water

   

Sheet II-1, Line 2, col. G

7

615

Purchased power

   

Sheet II-1, Line 3, col. G

8

618

Other volume related expenses

   

Sheet II-1, Line 4, col. G

9

630

Employee labor

   

Sheet II-1, Line 7, col. G

10

640

Materials

   

Sheet II-1, Line 8, col. G

11

650

Contract work

   

Sheet II-1, Line 9, col. G

12

660

Transportation expense

   

Sheet II-1, Line 10, col. G

13

664

Other plant maintenance

   

Sheet II-1, Line 11, col. G

14

670

Office salaries

   

Sheet II-1, Line 14, col. G

15

671

Management salaries

   

Sheet II-1, Line 15, col. G

16

674

Employee pensions and benefits

   

Sheet II-1, Line 16, col. G

17

676

Uncollectible

   

Sheet II-1, Line 17, col. G

18

678

Office services and rentals

   

Sheet II-1, Line 18, col. G

19

681

Office supplies and expenses

   

Sheet II-1, Line 19, col. G

20

682

Professional services

   

Sheet II-1, Line 20, col. G

21

684

Insurance

   

Sheet II-1, Line 21, col. G

22

688

Regulatory Commission expenses

   

Sheet II-1, Line 22, col. G

23

689

General expenses

   

Sheet II-1, Line 23, col. G

24

 

SUBTOTAL

     

25

403

Depreciation

   

Sheet III-7, Line 8

26

408

Taxes other than income

   

Sheet IV-1b, Line 17

27

409/10

Income taxes

   

Sheet V-1, Line 12, col. E

28

TOTAL DEDUCTIONS

   

Line 25+Line 26+Line 27

29

NET REVENUE

   

Line 24 less Line 28

30

RATE BASE

   

Sheet III-2, Line 16

31

RATE OF RETURN

   

Line 29 divided by Line 30

VIII

SECTION VIII

                 
                 
 

Section VIII is used for rate design.

       
                 
                 
 

Instructions for Section VIII:

         
                 
 

Whille this section is optional, it is recommended. Sheet VIII-1 will design a set of rates at your requested revenue requirement.

 
   
   
   

Sheet VIII-1

______________ WATER COMPANY

WORKPAPERS - ADVICE LETTER RATE INCREASE: RATE DESIGN

TEST YEAR __________

         
         

Rates designed under criteria established by D.85-06-064:

         

Line

A

B

C

No.

 

DETERMINATION OF FIXED COSTS

   

1

Gross reveues at proposed rates

Sheet VI-1, line 6

$

 

Less:

     

2

Purchased power - Account 615

Sheet II-1, line 3

( )

3

Purchased water - Account 610

Sheet II-1, line 2

( )

4

Other volume related - Account 618

Sheet II-1, line 4

( )

5

Income taxes

 

Sheet VI-3

( )

6

Uncollectibles - Account 676

Sheet II-1, line 17

( )

7

Franchise fee

   

( )

8

     

( )

9

     

( )

10

FIXED COSTS

   

$

11

% OF FIXED COSTS RECOVERED IN SERVICE CHARGE (Class B = 50%, Class C = 66%)

 

%

   

12

TO BE RECOVERED THROUGH SERVICE CHARGE

$

 

RECAP:

     

13

RECOVERED THROUGH SERVICE CHARGE

 

$

14

RECOVERED THROUGH COMMODITY RATE

 

$

 

TOTAL

   

$

 

TO BE RECOVERED THROUGH SERVICE CHARGE

   

15

TOTAL METER EQUIVALENTS

Sheet I-2, line 9

 

16

CHARGE PER 5/8" x 3/4" METER (line 14 : line 15)

 

$

 

TO BE RECOVERED THROUGH COMMODITY RATE

 

$

17

TOTAL ESTIMATED WATER SALES IN CCF'S

Sheet I-5, line 14

 

18

CHARGE PER CCF (line 14 : line 17)

 

$

 

PROPOSED RATES:

     

19

FOR ALL WATER DELIVERED PER 100 CU.FT.

   
 

SERVICE CHARGE (PER 5/8" X 3/4")

   

20

5/8" x 3/4"

 

X 1.0 =

 

21

3/4"

 

X 1.5 =

 

22

1"

 

X 2.5 =

 

23

1 1/2"

 

X 5.0 =

 

24

2"

 

X 8.0 =

 

25

3"

 

X 15.0 =

 

26

4"

 

X 25.0 =

 

Top Of Page