2. Background
On July 26, 2006, Cal Water filed GRC applications and supporting workpapers for eight of its 24 districts. The Dixon, Oroville, South San Francisco, and Willows districts are located in northern California. The Bakersfield, King City and Selma districts are located in central California, and the Westlake district is in southern California, near Los Angeles. Bakersfield is Cal Water's largest district, with 65,256 service connections.5
The eight applications contain rate requests for a three-year period beginning July 1, 2007 and are filed in compliance with Public Utilities Code Section 455.2 (Section 455.2) and the requirements of the Rate Case Plan (RCP) we adopted in D.04-06-018.6 The DRA timely protested the applications.
A prehearing conference (PHC) was held on September 27, 2006, followed by Public Participation Hearings in each district in November. On November 22, 2006, the assigned Commissioner issued his scoping memo that confirmed the consolidation of the eight applications, set the scope of issues and procedural hearing schedule, and designated Administrative Law Judge (ALJ) Walwyn as the principal hearing officer.
The scope of this proceeding does not include development of increasing block rates (IBR) for residential, commercial, industrial, agricultural and public authority customers. Prior to the PHC, Cal Water requested this proceeding be bifurcated in order to have the time necessary to develop a conservation rate design using IBR. It later filed a separate Application (A.) 06-10-026 requesting the Commission's permission to develop and implement conservation rate design for all of its districts in a separate proceeding, I.07-01-022. This request was granted in the scoping memo. Therefore, the revenue requirement adopted here will be implemented under Cal Water's existing rate design in each of the eight districts.7
By ruling dated November 1, 2006, the ALJ granted the motions to intervene filed by North Ranch Country Club (North Ranch) and the San Francisco Public Utilities Commission (SFPUC).8
Evidentiary hearings were held in San Francisco on January 16 and on March 12, 13, 22, and 29, 2007. Cal Water and DRA filed a settlement addressing most ratemaking issues on February 26, 2007. Opening briefs were filed on April 12 by Cal Water, DRA, and North Ranch and reply briefs were filed on April 19, 2007 by the same parties. The proceeding was submitted with the receipt of reply briefs.
On June 21, 2007, the Commission issued D.07-06-028, granting Cal Water interim rate relief in these eight districts beginning July 1, 2007. The interim rates are based on the rate of inflation as compared to existing rates for each district, with the inflation rate calculated using the most recent Consumer Price Index maintained by the U.S. Department of Labor. These interim rates are subject to true-up to the final rates adopted in this decision.
5 Bakersfield and South San Francisco's last GRC increase was authorized by D.04-09-038 in 2004. Oroville and Selma's last general rate increase was authorized by D.04-04-041 in 2004. Dixon, King City, Westlake and Willows' last GRC increase was authorized by D.03-09-021 in 2003.
6 All section references in this decision, unless specifically noted, are to the Public Utilities Code.
7 The rate design adopted here is subject to change on a going-forward basis when a conservation rate design is adopted in I.07-01-022.
8 North Ranch is a customer of potable and reclaimed water in the Westlake district and SFPUC is the primary water supplier to Cal Water's South San Francisco District.
