3. Background

Bidwell has been before the Commission on a number of occasions. In Decision (D.) 98-10-025, as modified by D.99-04-028, the Commission found that the company had failed to credit $116,277 of surcharge revenues to a balancing account earmarked for payment of a Safe Drinking Water Bond Act (SDWBA) loan. Bidwell acknowledged the underpayment but argued that the funds were redirected to utility operating expenses.

The Commission in Resolution W-4243 (January 4, 2001) reduced the customer surcharge and amended Bidwell's tariff sheets to reflect the reduction. Bidwell's application to rehear the resolution was denied in D.01-02-079. Earlier, on May 19, 1999, Bidwell's appeal of the Commission's 1998 decision was denied by the California Supreme Court.

On May 6, 2002, Bidwell filed this application, proposing sale of the water system to the Dougall Family Trust, Craig Dougall Trustee. The proposed sale was conditioned upon the Commission restoring the full amount of the surcharge to cover payments on the SDWBA loan. Before any action on this proposal, the Commission received an order of the Plumas County Superior Court, filed May 31, 2002, granting the sale of Bidwell to the District as part of a proceeding between Thomas and Vicky Jernigan.

By Administrative Law Judge's Ruling dated June 20, 2002, Bidwell was directed either to amend its application or to explain why the application should not be deemed moot in view of the Superior Court order. By letter and motion dated July 16, 2002, Bidwell amended its application to substitute the District as purchaser and to delete the purported conditions on sale with respect to restoration of the surcharge. An executed contract of sale between Bidwell and the District is attached to and made part of the amended application.