2. Procedural Background

Cal Water filed Application (A.) 06-12-025 for authority to recover its PBOP regulatory asset over a 15-year period. The origin of the regulatory asset is described below. Notice of A.06-12-025 appeared in the Commission's Daily Calendar on December 26, 2006. The Division of Ratepayer Advocates (DRA) filed a protest opposing A.06-12-025. There were no other protests. A prehearing conference (PHC) was held on March 28, 2007.

The Assigned Commissioner's Scoping Memo, issued on April 5, 2007, pursuant to Rule 7.3(a) of the Commission's Rules of Practice and Procedure (Rules), established the scope of this proceeding, determined that evidentiary hearings were necessary, and set a schedule for the proceeding. Two rounds of written testimony were served in October 2007, and two days of evidentiary hearings were held on November 8 and 9, 2007. The proceeding was submitted at the conclusion of the oral argument that was held on March 10, 2008, before a quorum of Commissioners.

As required by Rules 3.2(b), 3.2(c), and 3.2(d), Cal Water provided notice of A.06-12-025 by mail, newspaper advertisements, and bill inserts to specified governmental bodies, the public, and Cal Water's customers. The Commission received several letters and e-mails from customers who opposed A.06-12-025. In general, these customers wrote that is unfair for them to pay for the medical benefits provided to Cal Water's retirees when these customers had to pay for their own retirement benefits.