B. Procedural Background

Each of these concurrently filed GRC application requests authority to increase rates for water service in the years 2005, 2006, and 2007.

At the first prehearing conference (PHC) on July 13, 2004, Cal-Am stated that in response to Ordering Paragraph 12 of D.04-05-023, issued after its April filings, it would likely file an application to consolidate for ratemaking purposes its Sacramento and Larkfield districts. Further, Cal-Am stated it was still developing this proposal for rate consolidation and therefore could not state how the proposed would affect the two pending GRC applications. In response, the assigned Administrative Law Judge (ALJ) scheduled a second PHC for August 16, 2004, after the deadline by which Cal-Am would decide whether to file an application to consolidate its Sacramento and Larkfield districts.³ On August 11, 2004, Cal-Am filed Application (A.) 04-08-013, a rate consolidation application for its Larkfield and Sacramento districts.

At the August 16 PHC, Cal-Am and ORA both agreed it made good sense to consolidate the three cases for purposes of evidentiary hearings, and the ALJ so ruled. A preliminary schedule was set and PPH's scheduled for Larkfield and Sacramento. A discussion also begun on whether and how the new rate case plan (RCP) adopted in D.04-06-018 would apply here. A third PHC was set for September 23, 2004, after the protest period had ended for A.04-08-013.⁴

At the third PHC, the assigned ALJ granted County of Santa Cruz's request to intervene in the proceeding but denied its motion to consolidate the three cases here with Cal-Am's Felton-Monterey rate consolidation application, ruling that the County of Santa Cruz's interest in consolidating Felton with Sacramento rather than Monterey could be explored in both dockets without the need to further delay the schedule here.⁵ Additional parties granted intervention were the LWWDAC and the Mark West Area Chamber of Commerce.

In discussing the applicability of the new RCP, both Cal-Am and ORA stated that since the Sacramento and Larkfield GRCs were filed in April, the new calculation methodologies should not apply here. In the matter of scheduling, the overall schedule agreed to by all parties follows Cal-Am's August filing and is generally consistent with the new RCP.

Responding to questions from the ALJ, Cal-Am stated that the table showing the benefits of rate consolidation for the Larkfield district (Table E of A.04-08-013) was incorrect and a revised table would be filed on September 24, 2004.

PPHs were held in Larkfield on September 29, 2004, and in Sacramento on September 30, 2004.

ORA and interested parties served testimony on November 10, 2004, and interested parties served rebuttal on November 17, 2004. On December 16, 2004, Cal-Am filed a settlement agreement between Cal-Am, ORA, and LWWDAC. LWWDAC later expressed concerns with the disposition of the Well No. 6 issue, and Cal-Am witnesses appeared on this issue at the evidentiary hearings held on January 24 and January 25, 2005. On the last day of hearings, the parties reached a revised settlement agreement and this was filed by joint motion on February 25, 2005. No party filed comments on the revised settlement.

Parties filed briefs on the remaining contested issues on February 25, 2005 and reply briefs on March 10, 2005.