6. Assignment of Proceeding
Kevin Coughlan is the assigned Examiner in this proceeding.
Findings of Fact
1. Beginning approximately 1960, the Cavanaughs developed and sold building sites along Redwood Drive in Santa Cruz County, initially obtaining water service to those sites from a local water utility.
2. After losing this local water supplier, the Cavanaughs were forced to develop their own water system to serve their subdivision.
3. As the result of customer complaints, in 1970 the Commission declared the Cavanaugh water system to be a public utility subject to Commission regulation.
4. The Cavanaughs incorporated the water system as Greenbelt in 1980. 5. In January 1997, the Cavanaughs stipulated to the Mills-McAllister operation of the water system pending a final decision in I.96-09-002, with the Mills-McAllister team to remit surcharge payments to a Fiscal Agent for the SDWBA loan.
6. D.00-06-010 ordered that Mills and McAllister be permitted a reasonable time in which to obtain corporate status, and thereafter to apply for formal Commission authorization to acquire Greenbelt from Mrs. Cavanaugh and/or the Cavanaugh Estate.
7. PureSource was formed in 2005 with the stated purpose of acquiring and managing community water systems.
8. PureSource will be acquiring Greenbelt Water Company for a price of $1.
9. Since only a transfer of ownership is proposed, it can be seen with certainty that the acquisition of this system will have no significant effect on the environment.
10. As a public utility, PureSource and its new owners are responsible to the Commission for remittance of the Public Utilities Commission User Fees.
11. A change in ownership of a public water system requires the new owner to satisfy Department of Health Services' requirements to operate a public water system.
12. After consummation of the acquisition, the current owner of Greenbelt Water Company will no longer provide public utility water service in the service territory. The new owners (PureSource) will assume these duties and obligations.
13. PureSource will serve all the present 79 customers and the future customers in Aptos, Santa Cruz County, California.
1. PureSource has the legal capacity and experience to acquire and operate the water system of Greenbelt.
2. The acquisition of ownership and control of Greenbelt by PureSource is in the public interest and will provide tangible benefits to ratepayers.
3. Upon completion of the acquisition, the current owner of Greenbelt should be relieved of public utility water duties and obligations.
4. PureSource should apply to Department of Health Services for re-issuance of the existing permit of Greenbelt.
5. This order should be made effective immediately so as to permit prompt consummation of the acquisition.
IT IS ORDERED that:
1. Michael Mills and Opal McAllister are authorized to acquire Greenbelt Water Company and incorporate it into PureSource Water, Inc., (PureSource) based on the same terms and conditions with those set forth in Application 06-01-010.
2. The authority granted in Ordering Paragraph 1 shall expire if not exercised within 12 months after the effective date of this order.
3. PureSource 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 60 days.
4. PureSource 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 60 days.
5. PureSource shall, upon Commission staff request, make all books and records available for review and inspection either 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.
6. The Corporate Identification Number assigned to PureSource remains unchanged.
7. PureSource shall record the acquisition of Greenbelt at original cost in accordance with the Uniform System of Accounts for Water Companies.
8. Upon compliance with this order, the current owner of Greenbelt shall be relieved of the public utility obligation, and the Certificate of Public Convenience and Necessity will be transferred to PureSource.
9. Application 06-01-010 is granted as set forth above.
10. Application 06-01-010 is closed.
This order is effective today.
Dated July 20, 2006, at San Francisco, California.
MICHAEL R. PEEVEY
President
GEOFFREY F. BROWN
DIAN M. GRUENEICH
JOHN A. BOHN
RACHELLE B. CHONG
Commissioners
