9. Assigned Commissioner and Presiding Officer

John A. Bohn is the assigned Commissioner, and ALJ Victoria S. Kolakowski is the presiding officer.

1. This proceeding was initiated on January 4, 2007.

2. D.07-12-041 extended the statutory deadline for resolution of this proceeding to July 7, 2008.

3. D.08-06-033 subsequently extended the statutory deadline for resolution of this proceeding to January 7, 2009.

4. D.08-12-051 further extended the statutory deadline for resolution of this proceeding to May 29, 2009.

5. Evidentiary hearings were conducted on June 23, 2008 and on December 17 and 18, 2008.

6. Harbor City operates and maintains a submetered gas system (System) serving 192 spaces in a manufactured housing community (commonly known as a MHP) in Harbor City, California. SoCalGas provides the master meter gas service.

7. The System was reinstalled in 1995, and was inspected by the California HCD, the designated state agency responsible for oversight of construction of gas systems in MHPs.

8. The System is constructed of PE pipe, and is commonly trenched with water utilities, with a minimum depth of 18 inches of cover. The System includes mains underneath the common roadways in the MHP and individual service lines from the mains to the individual customer plots.

9. The System has operated since 1995 with no complaints of disruption of service.

10. Gas systems are subject to the minimum safety standards of 49 C.F.R. Part 192. Public utilities may have additional safety standards under 49 C.F.R. § 192.13(c).

11. 49 C.F.R. § 192.327(d) permits commonly trenched utility lines to have less than 24 inches cover to comply with state law, which means that lesser cover may be safe if determined to be so under state law.

12. Cal. Code of Regs., Tit. 25, § 1216 permits trenching at 18 inches in MHPs such as the System. HCD uses 18 inches as the minimum depth for MHP gas systems that it inspects.

13. 49 C.F.R. Part 192 and the California Plumbing Code do not specify a minimum separation between gas mains and other utilities in a common trench.

14. Cal. Code of Regs., Tit. 25, § 1222(b) specified at the time of construction of the System that gas outlets be within 4 feet of the rear of each mobile home, and the System complied with that requirement.

15. The System has been operated safely at its present pressure of approximately 5 pounds psig, and may continue to be safely operated at this pressure after transfer.

16. SoCalGas' discretionary standards related to line cover, line separations, distance of risers from mobile homes, and operating pressure thwart the application of §§ 2791-2799.

17. The submeter discount is designed only to compensate the MHP operator for its costs of operating the submetered system; thus, the discount is not part of the value of the system for purposes of a transfer under Pub. Util. Code §§ 2791-2799.

18. The LE allowance is not applicable to existing MHP submetered systems.

19. The present value of the System is $132,544, based upon factors such as total footage of mains, total footage of service lines, meter counts, number of spaces in the MHP, the condition of the pipes based upon factors such as age, material, condition, etc., and installation date.

20. Exhibits 1-22 are identified herein and have been offered by either Harbor City or SoCalGas as testimony.

1. A transfer of a submetered gas system from a MHP to a gas utility is governed by §§ 2791-2799.

2. The utilities' discretionary gas safety standards may not be set in a manner that thwarts the application of state law, including Pub. Util. Code §§ 2791-2799.

3. The System is capable of providing the end users a safe and reliable source of gas service.

4. The System is capable of serving the customary expected load in Harbor City.

5. The System complies with GO 112-E.

6. The System is acceptable for transfer under § 2794.

7. Valuation of a submetered gas system may not be based upon the submeter discount or the LE allowance.

8. The appropriate valuation for a submetered gas system transferred under §§ 2791-2799 should be based upon characteristics such as total footage of mains, total footage of service lines, meter counts, number of spaces in the MHP, the condition of the pipes based upon factors such as age, material, condition, etc., and installation date. Based upon these factors, the appropriate value of the System is $132,544.

9. Exhibits 1-22 have been offered as testimony by the parties and should be entered into the record of this proceeding.

10. To resolve this long-standing dispute as soon as possible, today's order should be made effective immediately.

ORDER

IT IS ORDERED that:

1. Southern California Gas Company (SoCalGas) shall accept transfer of the submetered gas system (System) of Harbor City Estates, LLC (Harbor City), in its present condition, pursuant to Pub. Util. Code §§ 2791-2799.

2. SoCalGas and Harbor City shall develop a cost for transfer of the System pursuant to Pub. Util. Code § 2795, in a manner that reflects a present value of the System of $132,544 and the other guidance contained in this decision.

3. SoCalGas and Harbor City shall comply with all other provisions of Pub. Util. Code §§ 2791-2799.

4. SoCalGas shall amend its operational rules, if necessary, in a manner consistent with this decision.

5. Exhibits 1-22 are entered into the record of this proceeding, under the conditions specified herein.

6. Case 07-01-007 is closed.

This order is effective today.

Dated February 20, 2009, at San Francisco, California.

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