8. Assignment of Proceeding
Commissioner Carl W. Wood is the Assigned Commissioner and Glen Walker is the assigned ALJ for this proceeding.
1. Mesa Crest serves 710 connections around the community of the City of La Canada Flintridge in the County of Los Angeles.
2. Mesa Crest finds it difficult to financially maintain the system and provide service to its customers.
3. Cal-Mich owns 100% of the outstanding stock of East Pasadena Water, a Class B regulated water company with 2,802 connections.
4. Cal-Mich has long experience in supplying water in the East Pasadena area and in the cities of Arcadia and Temple City, Los Angeles County.
5. Cal-Mich has formed a wholly owned subsidiary that will acquire 100% of the outstanding stock of Mesa Crest.
6. It can be seen with certainty that the sale and transfer of this system will have no significant effect on the environment.
7. As a public utility, Mesa Crest remains responsible to the Commission for remittance of the Public Utilities Commission Users Fees collected up to the date of sale and transfer. Thereafter, the new owner will continue imposing the user fees on customers' bills.
8. A change in ownership of a public health system requires the prospective new owner to satisfy DHS requirements to operate a public water system.
9. Protestants who seek public ownership of the water system may continue to pursue that objective regardless of the transfer of ownership at issue here.
10. After consummation of the sale and transfer, the current owners of Mesa Crest will no longer provide public utility water service in the La Canada Flintridge area, with Cal-Mich and its subsidiary MCWC, Inc., having assumed these duties and obligations.
1. Cal-Mich has the legal capacity and experience to acquire and operate the water system of Mesa Crest.
2. The acquisition of ownership and control of Mesa Crest by Cal-Mich is in the public interest and will provide tangible benefits to ratepayers.
3. Upon completion of the sale and transfer, and remittance of pending Public Utilities Commission Users Fees collected to the date of sale and transfer, the current owners of Mesa Crest should be relieved of their public utility water duties and obligations.
4. Cal-Mich and MCWC, Inc., should apply to DHS for re-issuance of the existing permit of Mesa Crest.
5. Resolution ALJ 176-3129 is amended to show that public hearing in this matter is necessary.
6. The scope of this proceeding is set forth in the application and the two protests.
7. This order should be made effective immediately so as to permit prompt consummation of the sale and transfer.
IT IS ORDERED that:
1. On or after the effective date of this order, F. Patrick Flynn and Joyce H. Flynn are authorized to sell 100% of their outstanding shares of common stock of Mesa Crest Water Company (Mesa Crest) to the California-Michigan Land and Water Company or its wholly-owned subsidiary MCWC, Inc. (Buyer) upon terms and conditions substantially consistent with those set forth in Application (A.) 04-01-024, as amended.
2. Mesa Crest shall remit to the Commission the Public Utilities Commission Users Fees collected up to the date of sale and transfer within 90 days of the date of sale and transfer of its water system.
3. The Buyer and Mesa Crest shall jointly notify the Director of the Water Division in writing of the actual transfer date as authorized herein and file tariffs under the name of the Buyer within ten (10) days of the transfer. A true copy of the instrument of transfer or other related transfer document(s) shall be attached to the written notification.
4. The Buyer shall provide the Director of the Water Division a copy of the State of California's Secretary of State Certificate of Status of Domestic Corporation and a copy of its Articles of Incorporation, within 10 days of the date of the transfers.
5. The Buyer shall provide the Director of the Water Division a copy of the permit to operate the water system granted to it by the Department of Health Services, within 20 days of receiving such permit.
6. Sixty days after the transfer of the water system to the Buyer, Mesa Crest shall provide the Director of the Water Division with the 2004 Annual Report to the Commission covering operations from January 1, 2004 to the date of sale.
7. On or before the March 31, 2005, Buyer shall provide the Director of the Water Division with the 2004 Annual Report to the Commission covering operations from the date of transfer of the water system to the end of calendar year December 31, 2004.
8. The Buyer shall, upon Commission staff request, make all books and records available for review and inspection. In the event such books and records are required for inspection by the Commission or its staff, the Buyer shall either produce such records at the Commission's offices or at another location in California, or reimburse the Commission for the reasonable costs incurred in having the Commission staff travel out of State to the offices where the books and records are maintained.
9. The Corporate Identification Number assigned to the Buyer is U-333-W, which shall be included in the caption of all original filings with the Commission, and in the titles of other pleadings filed in existing cases.
10. The Buyer shall record the acquisition of Mesa Crest at original cost in accordance with the Uniform System of Accounts for Water Companies.
11. The authority granted in Ordering Paragraph 1 shall expire if not exercised within 12 months after the effective date of this order.
12. Upon compliance with this order, the current owners of Mesa Crest shall be relieved of their public utility obligation, and the Certificate of Public Convenience and Necessity will be transferred to Buyer.
13. The preliminary determination on the need for hearing is changed. Public hearing in this matter is necessary.
14. The scope of this proceeding is set forth in the application and the two protests.
15. The application is granted as set forth above.
16. A.04-01-024 is closed.
This order is effective today.
Dated ______________________, at San Francisco, California.
