5. Issues
Based on applicant's statement of proposed issues in the application, ORA's protest, plus parties' statements at the prehearing conference, the issues were identified in the scoping memo as:
a. Adoption of a just and reasonable rate of return, and return on equity, for 2006, 2007, and 2008.
b. Adoption of a reasonable forecast of Apple Valley's operating expenses and revenues for Test Year 2006, including Apple Valley's use of the "New Committee Method" to forecast revenues as authorized in D.04-06-018.3
c. Adoption of a reasonable rate design.
d. Adoption of a reasonable forecast and appropriate allocation of costs from any parent or other affiliated company included in Apple Valley's revenue requirement for Test Year 2006.
e. Adoption of a reasonable forecast of capital additions, plant in service, and working cash, to estimate Test Year 2006 rate base. Included in this is the appropriate allowance for depreciation in determining the working cash allowance.
f. Examine other issues that may affect Apple Valley's ability to provide efficient, safe, and reliable water service.
g. Determine Apple Valley's compliance with applicable Commission decisions, including but not limited to D.04-06-018, D.03-08-069, and other decisions generally applicable to water utilities, or specifically to Apple Valley and its affiliates. Specifically, the proceeding will examine Apple Valley's:
3 Mimeo., p. 20, Appendix, p. 6.
4 D.04-06-018, Attachment, p. 10. See §§ 789 - 790.1.
5 D.03-08-069, p. 44, and Ordering Paragraph 5: "AVR (Apple Valley) shall gather demographic information about its customers for the purpose of determining the feasibility of offering reduced rate programs for its low-income customers and include those results and a recommendation for a low-income program in its next general rate case (GRC). If AVR determines that such a program is not feasible, it shall explain why."
6 D.03-08-069, p. 25, and Ordering Paragraph 3: "AVR shall provide information in its next GRC to support the inclusion of backup generators in rate base. That additional information shall include, but not be limited to, the identity of each generator by horsepower, facility intended to backup, year purchased, rate base amount, actual time placed in service as a backup facility, and actual amount of time tested by year since acquired."
