Complement
1.01 ORA's General Office report stated that ORA's general office payroll expenses included 19 new employee positions for 2001 (page 2-5). Included were a CIS Functional Team Member, a CIS Functional Help Desk Member, and a CIS project leader; however, ORA's revenue requirement inadvertently did not include the salaries for the three positions and included the salary for an environmental assistant twice. ORA agrees that its general office payroll expenses should be increased by $182,479 in 2002 and $187,953 in 2003 to reflect these positions.
1.02 After further discussions concerning the responsibilities and comparable compensation for three existing positions (Database Administrator, Network Manager, Network Administrator) that were upgraded in 2001, the parties agree that it is reasonable to add to ORA's estimates $89,000 in 2002 and $91,670 in 2003 to reflect the new assignment of duties and responsibilities.
1.03 During discussions with ORA, Cal Water provided additional detail concerning the duties and responsibilities for three new engineering positions: an electrical engineer in 2002, an electrical technician in 2002, and a production engineer in 2003. Since the majority of salaries for these positions is capitalized (87%) and reflected in the district capital project estimates, ORA accepts and the parties agree that $14,033 in 2002 and $22,011 in 2003 or 13% of the salaries for these positions should be added to ORA's estimates of payroll expenses for in-house expertise in these areas.
1.04 After Cal Water provided additional justification concerning the need to upgrade its web site to meet the Commission's requirements for posting tariffs and filings with the Commission and the customer benefits of accessing customer specific information, ORA accepts and the parties agree that $80,000 in 2002 and $82,400 in 2003 for one senior web developer should be added to ORA's payroll estimates.
1.05 Cal Water clarified that $43,000 in its capital costs included the annual maintenance expenses for the LIMS system. ORA properly removed this expense as a capital cost, but did not include the estimate in ORA's annual expense estimates. ORA and Cal Water agree that the annual maintenance contract expense should be added to ORA's expense estimates for 2002 and 2003 in account 742.
1.06 Cal Water's representatives from its Informations Systems (IS) department detailed the need for additional data storage and demonstrated that a centralized storage system was the most cost effective alternative. Additionally, the IS representatives provided additional information concerning a Citrix system, which will allow Cal Water to upgrade its windows operating system that will no longer be supported by Microsoft. These projects are more fully discussed under General Office Plant Improvements; however, ORA and Cal Water agree that these capital improvements would save administrative costs of $50,000 in 2002 and 2003. ORA's estimate for Account 792 should be reduced accordingly.
1.07 Cal Water provided additional justification showing that $1 million of the $1.2 million in credit associated with the curtailment of the Dominguez Water Corporation pension plan in 2000 was a one-time saving due to the Cal Water/Dominguez merger and not an ongoing benefit to Cal Water's pension plan. Accordingly, ORA and Cal Water agree that this one-time merger related cost savings should be treated in the same manner as one-time merger related costs and that only $200,000 of the Dominguez pension credit should be reflected in ORA's estimates of account 795. Additionally, ORA and Cal Water agree that a $200,000 adjustment should be spread over three years, the rate case cycle. ORA had reflected its original $1.2 million credit over two years, however, after further analysis and discussion concerning the impact on attrition rates ORA agrees that this adjustment should be evenly spread over the three year rate case cycle. Thus, ORA agrees that its estimate of account 795 should be increased by $533,333 per year.
1.08 As with the pension adjustment above ORA and Cal Water agree that the adjustment to the injuries and damages account should be amortized over three years instead of two as shown in ORA's report. This increases ORA's estimates for account 794 by $67,000 per year.
1.09 ORA and Cal Water corrected calculation errors in account 798 and 799, increasing ORA's estimates in those categories by approximately $75,000 annually and $40,000 annually, respectively.
1.10 ORA and Cal Water clarified that pensions and benefits calculations for general office should be based in part on total company changes to complement. Therefore, ORA and Cal Water agree that $155,600 in 2002 and $272,100 in 2003 Pensions and Benefits should be added to ORA's original position.
1.11 In its General Office report ORA removed Cal Water's proposed adjustment for synergies/savings related to the combining of Dominguez Water Corporation's general office functions with Cal Water's general office functions. On March 8, 2002, Cal Water
filed a Petition to Modify Decision 00-05-047, the Commission's decision in the Dominguez/Cal Water merger Application 99-02-004, requesting authority to file the first combined rate application for Cal Water's Hermosa-Redondo and Palos Verdes districts and Dominguez' South Bay district in July of 2002. As stated in the petition ORA does not intend to oppose Cal Water's request.
After further discussion concerning Cal Water's first combined application ORA and Cal Water agree that the issue of general office merger related synergies will be addressed in that proceeding. Moreover, since that proceeding will also address synergies related to the combining of Dominguez' South Bay district with the two Cal Water districts, ORA and Cal Water agree to defer the issue of synergies in the instant proceeding pending the outcome of the combined application proceeding. Accordingly, ORA and Cal Water agree that the Commission should authorize Cal Water to establish a memorandum account that will track the revenue requirement associated with Cal Water's proposed synergies adjustment for subsequent recovery, if found reasonable. Furthermore, Cal Water agrees to accept ORA's proposed treatment of general office synergies in the instant proceeding.
2.0 General Office Plant Improvements
2.01 ORA and Cal Water agree that Cal Water should be allowed $170,000 in 2002 for software, hardware, and site development so that the website calwater.com will meet all the Commission's requirements under General Order 96-B and provide greater customer benefits.
2.02 After Cal Water clarified the calculations shown in its workpapers, ORA and Cal Water agree that $199,400 expended on capital projects in 2001 but omitted from ORA's report should be added to ORA's 2001 plant estimate.
2.03 Cal Water provided additional justification for a new plan to implement PeopleSoft version 8.0 and provided a reduced cost estimate. Peoplesoft version 8.0 is a software package that will be used for maintaining Cal Water's financial, accounting, human resources, and billing records. Currently, Cal Water uses an older Peoplesoft version that will no longer be supported by Peoplesoft. The new plan reduces outside consulting services and spreads the cost of the implementation over 2002, 2003, and 2004. ORA and Cal Water agree that the new plan responds to ORA's initial concerns with the project and that $192,000 in 2002 and $272,000 in 2003 should be added to ORA's estimates of capital improvements.
2.04 As discussed above, in response to ORA's concerns, Cal Water and ORA quantified the operating savings from implementing the Citrix and centralized storage system projects. Cal Water and ORA agree that $324,000 for the centralized storage system in 2002 and $250,400 for the Citrix system in 2003 should be included in ORA estimates of capital improvements
2.05 Cal Water presented additional justification that the project to replace its aging payment processing machines with more efficient machines should be allowed in 2003 and 2004. Based on this additional information ORA agrees that $108,000, one half of the project cost, should be included in its 2003 test year estimate. Additionally, Cal Water and ORA agree that $150,000 should be removed from plant and $125,000 from depreciation reserve in 2003 to reflect the retirement of two existing payment processing machines.
2.06 Cal Water provided additional justification for six vehicles purchased by the company in 2002, but disallowed in ORA's estimate of capital improvements. Based on the discussions that addressed employee compensation and the business use of these vehicles ORA and Cal Water agree that three of these vehicles totaling $75,000 should be included in ORA's 2002 capital improvements estimate.
2.07 After Cal Water showed additional detail reflecting lower costs for the source water assessment program (SWAP), ORA agrees that $70,000 in plant additions for each test year should be included in its estimates and to withdraw its recommendation of an advice letter filing capped at $387,000.
3.01 Cal Water and ORA agree to use the depreciation rates previously adopted by the Commission and currently in effect for each district rather than the proposed rates of either party.
3.02 ORA agrees that its estimate of franchise fees for Test Year 2002 in the Westlake district should be corrected to include local franchise fees based on test year revenues.
3.03 ORA agrees that Cal Water's deferred income taxes and depreciation expenses based on the adopted depreciation rates and rate base should be used to calculate income taxes in accordance with the Commission's rate setting policy.
3.04 ORA and Cal Water agree that the Department of Health Services (DHS) fees should be added to ORA expense estimates. The five-year average (1996-2000) of the DHS fees contained in Cal Water's workpapers should be used to estimate the appropriate level of these fees in each district. Attached as Appendix A is a list of fees by district.
3.05 ORA and Cal Water agree that ORA's estimates for postage should be increased to reflect the postal rate increase, effective July 1, 2002, of 2.3 cents per bill or 9.02%.
4.0 District Plant & Rate Base
4.01 ORA and CWS agree to use a ten-year average adjusted for inflation for estimating non-specific capital expenditures. This consistent method for all districts was used in ORA's reports for Cal Water's southern districts.
4.02 Cal Water provided additional information clarifying that the 20% factor for employee time to convert its district water system paper maps to digital maps was not Cal Water's standard overhead factor. Based on Cal Water's additional information ORA agrees that the 20% factor should replace its use of Cal Water's standard overhead factor for this project.
4.03 ORA and Cal Water have revised the lag days for computing the impact of federal and state income taxes on working cash allowance based on actual taxes paid and agree that 93 lag days fairly represents the timing and amount of taxes paid. Accordingly, Cal Water and ORA recommend that 93 lag days be used for the Commission adopted tax expense in determining the appropriate level of working cash allowance.
4.04 Bear Gulch
ORA and Cal Water agree that the advice letter for the cryptosporidium deactivation project recommended in ORA's report may be filed as long as the equipment is in service prior to January 1, 2005 and capped at $648,000 for capital costs.
4.05 King City
ORA and Cal Water agree that Cal Water should be allowed to file an advice letter for a 2003 well project as long as the well is in service prior to January 1, 2005 and capped at $500,000 for capital costs and an additional $100,000 for permitting.
4.06 Marysville
ORA and Cal Water agree that Cal Water should be allowed to file advice letters for the 2003 greensand purification project capped at $734,000 and the 2003 MTBE purification project capped at $864,000 if they are in service prior to January 1, 2005. ORA also agrees that should Cal Water demonstrate in its advice letter that one or more alternative capital improvement projects is equally cost effective that Cal Water should be authorized to replace the greensand and/or MTBE projects with one or more projects that are equally cost effective.
4.07 Mid-Peninsula
ORA and Cal Water agree that Cal Water should be allowed to file an advice letter covering the capital cost of a new operation center capped at $1 million as long as the facilities are in service prior to January 1, 2005.
4.08 Salinas
ORA and Cal Water agree that the north Salinas reservoir project should be deferred until the next general rate case for the Salinas District. Accordingly, ORA and Cal Water agree that the Commission should not adopt ORA's recommended advice letter treatment for this project.
4.09 Visalia
After additional discussions concerning Cal Water's request for two new wells, ORA and Cal Water agree that both wells should be excluded from ORA's estimate of the capital budget and that Cal Water should be authorized to file an advice letter capped at $600,000 for each well if in service prior to January 1, 2005.
4.10 Westlake
Cal Water and ORA agree that Cal Water should be allowed to file an advice letter capped at $250,000 to recover the capital costs of the Notter reservoir turnover project as long as it is in service prior to January 1, 2005.
5.0 Other Joint Recommendations
5.01 ORA and Cal Water agree that this proceeding should remain open to address the disposition of under-collections in Cal Water's offset expense balancing and memorandum accounts pending the outcome of R.01-12-009.
5.02 After discussions with the Director of the Commission's Water Division, Cal Water and ORA agree that Cal Water should be authorized to recover Commission ordered intervenor funding in step and/or attrition advice letter filings.
5.03 Cal Water agrees with ORA's recommendation that the Commission should establish a temporary balancing account to track revenues and expenses of the low-income rate assistance program. In its district reports ORA supports the proposed low-income rate assistance program as shown in Cal Water's application for each district.
5.04 ORA and Cal Water agree that Cal Water should conduct a six month time keeping study to evaluate the proper allocation of management time to non-regulated CPUC activities which are not subject to Decision 00-07-018. ORA agrees that this study addresses the recommendation in its General Office report.
5.05 Following considerable discussion concerning the cost of capital ORA and Cal Water agree that the Commission should adopt an 8.90% overall return on rate base. This agreement takes into consideration several factors including correcting certain calculations in ORA's report and adjusting American Water Company's stock price to remove the impact of the announced sale of the company. Additionally, ORA and Cal Water agree that the Commission should use a weighted cost of debt of 8.09%, a cost of 4.19% for preferred stock, and a return on equity of 9.70%. Finally, ORA and Cal Water agree that the Commission should apply these costs to the following capital structure: equity 51.5%, preferred 0.5%, and debt 48.0%.
5.06 ORA in its district reports recommended that the Commission use recorded sales data unadjusted for weather in calculating proforma earnings for approving Cal Water's step and attrition filings for districts in this proceeding. This recommendation was made in response to Cal Water's proposed language affecting the application of the Commission's current earnings test. After considering the merits of each party's position ORA and Cal Water agree that the Commission should authorize step and attrition increases for Cal Water's districts in this proceeding based on recorded earnings for the latest 12 months ending September 30 each year. Additionally, the recorded earnings test should be adjusted to exclude expenses subject to balancing or memorandum account recovery. Moreover, the sales and sales related expenses in the recorded earnings test should be adjusted to reflect normalized weather and exclude revenues credited to balancing and memorandum accounts. While ORA and Cal Water are in agreement with the methodology to adjust recorded sales to reflect normalized weather, additional time is necessary to develop a table of weather coefficients by district for each affected class of customers. ORA and Cal Water will jointly submit the table of coefficients within 30 days of the filing of this Joint Agreement. In accordance with the Commission's policy for approving step and attrition increases, should Cal Water's earnings, based on the recorded test above, exceed its authorized return, the requested step or attrition increase should be reduced to offset the earnings in excess of its authorized return in this proceeding or in any other future Cal Water proceeding, whichever is lower. Furthermore, Cal Water and ORA agree that any earnings adjustment to the step and attrition increases for the districts in this proceeding should not double count any portion of an earnings adjustment in another Cal Water proceeding or filing with the Commission. This Joint Recommendation is intended to resolve the issue of the appropriate earnings test for approving step and attrition increases and should not be considered binding in other proceedings, including R.01-12-009.
5.07 After further discussions and a review of recent recorded sales data ORA and Cal Water agree that the midpoint between ORA's and Cal Water's original sales forecasts for the residential and business classes should be used to estimate sales for 2002 and 2003. The agreed upon estimates are shown on the attached tables.
Additionally, ORA and Cal Water agree that, after reviewing recent recorded sales data, 17,000 KCcf, should be used for 2002 and 2003 as the total estimated sales in all districts for the multifamily, industrial, public authority, other, irrigation, and reclaimed water classes. This agreement represents the midpoint between average recorded sales and ORA's sales forecast. The attached Appendices B and C detail the joint recommendation by customer class for each district.
Furthermore, Cal Water agrees to file future general rate applications using the regression analysis referred to in Standard Practice U-25 and the supplement to U-25 (U-25). As set forth in U-25 the regression analysis uses annual temperature and rainfall (limited to 4-inches per month) and time as variables. Up to 13 years of recorded sales data (additional years may be added to eliminate years of drought data) should be used in the modeling process. Regression output statistics such as the Inverse McSee (standard error divided by the mean) and statistics that measure the regression models success should be used to evaluate and select the most appropriate sales forecasting models. Additionally, Cal Water may use other appropriate commercially available regression analysis programs.
5.08 After several meetings between ORA and Cal Water which included presentations by Cal Water's engineering personnel and Basin Water, a company that provides water treatment services for nitrates and other contaminants, ORA and Cal Water agree that the Salinas District faces an immediate and critical need for treatment facilities at four well sites. Additional information concerning the need for water treatment facilities in the Salinas District was provided in oral testimony by ORA and Cal Water and is contained in Cal Water's motion to establish a memorandum account filed May 10, 2002. Accordingly, ORA and Cal Water agree that the Commission should authorize Cal Water to establish a well-head treatment memorandum account for the Salinas District that will track the revenue requirement associated with water treatment for four wells. Additionally, ORA and Cal Water recommend that:
1. The well-head treatment memorandum account track the revenue requirement associated with treatment costs until the Commission issues a decision in Cal Water's next general rate application (subsequent to A. 01-09-071) for the Salinas District, and
2. Cal Water file annually by advice letter or application for recovery of the revenue requirement tracked in the wellhead treatment memorandum account.
Finally, in reaching this joint recommendation ORA and Cal Water recognize that Cal Water has not demonstrated a critical need for a similar memorandum account in its other 14 districts in this proceeding. Therefore, ORA and Cal Water agree that the Commission should not authorize Cal Water to establish the water quality memorandum accounts requested in its applications for these districts.
5.09 As set forth in its Results of Operation reports for the Dixon, King City, Marysville, Salinas, and Willows Districts ORA is in agreement with Cal Water's proposed water supply special facilities fees. Moreover, ORA and Cal Water agree that these fees should apply prospectively to all qualifying developments for which water supply special facilities costs have not been previously paid.
The signatories to these joint recommendations personally and independently verify that all elements, including the attached tables are correct, complete, and internally consistent.
OFFICE OF RATEPAYER CALIFORNIA WATER SERVICE
ADVOCATES COMPANY
By: /s/ Sung B. Han By: /s/ Francis S. Ferraro .
Sung B. Han Francis S. Ferraro
Project Manager Vice President
California Public Utilities Commission California Water Service Co.
505 Van Ness Avenue 1720 N. First Street
San Francisco, CA 94102 San Jose, CA 95112
Dated: July 18, 2002 Dated: July 18, 2002 .
2002 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
Bear Gulch |
|||||||
Residential |
4,192.0 |
5,021.2 |
4,606.6 | ||||
Business |
644.5 |
656.8 |
650.7 | ||||
Multi Family |
110.0 |
113.9 |
111.3 | ||||
Industrial |
2.2 |
2.2 |
2.2 | ||||
Public Authority |
92.8 |
112.8 |
99.3 | ||||
Other |
4.6 |
5.5 |
4.9 | ||||
Total |
5,046.1 |
5,912.4 |
5,475.0 | ||||
Chico |
|||||||
Residential |
2,256.4 |
2,450.9 |
2,353.7 | ||||
Business |
2,502.3 |
2,489.5 |
2,495.9 | ||||
Multi Family |
1,062.0 |
1,028.1 |
1,050.9 | ||||
Industrial |
140.5 |
142.5 |
141.2 | ||||
Public Authority |
469.7 |
556.6 |
498.0 | ||||
Other |
20.2 |
19.2 |
19.9 | ||||
Total |
6,451.1 |
6,686.8 |
6,559.6 | ||||
Dixon |
|||||||
Residential |
571.1 |
603.5 |
587.3 | ||||
Business |
58.5 |
54.7 |
56.6 | ||||
Multi Family |
33.6 |
39.9 |
35.7 | ||||
Industrial |
0.3 |
0.3 |
0.3 | ||||
Public Authority |
15.2 |
18.2 |
16.2 | ||||
Other |
- |
- |
- | ||||
Total |
678.7 |
716.6 |
696.1 | ||||
East Los Angeles |
|||||||
Residential |
3,930.9 |
4,085.6 |
4,008.3 | ||||
Business |
2,526.1 |
2,519.4 |
2,522.8 | ||||
Multi Family |
188.3 |
192.1 |
189.5 | ||||
Industrial |
1,497.5 |
1,528.9 |
1,507.7 | ||||
Public Authority |
846.0 |
696.9 |
797.4 | ||||
Other |
5.9 |
4.1 |
5.3 | ||||
Total |
8,994.7 |
9,027.0 |
9,031.0 | ||||
|
|||||||
Residential |
3,292.8 |
3,576.3 |
3,434.6 | ||||
Business |
895.7 |
945.9 |
920.8 | ||||
Multi Family |
1,107.9 |
1,211.8 |
1,141.8 | ||||
Industrial |
245.2 |
245.2 |
245.2 | ||||
Public Authority |
271.9 |
279.2 |
274.3 | ||||
Other |
4.3 |
4.3 |
4.3 | ||||
Reclaimed |
88.0 |
89.7 |
88.6 | ||||
Total |
5,905.8 |
6,352.4 |
6,109.6 | ||||
2002 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
King City |
|||||||
Residential |
393.2 |
399.2 |
396.2 | ||||
Business |
249.9 |
247.2 |
248.6 | ||||
Multi Family |
36.5 |
28.5 |
33.9 | ||||
Industrial |
63.3 |
74.2 |
66.9 | ||||
Public Authority |
30.9 |
38.4 |
33.3 | ||||
Other |
4.9 |
2.8 |
4.2 | ||||
Irrigation |
0.5 |
0.5 |
0.5 | ||||
Total |
779.2 |
790.8 |
783.6 | ||||
Livermore |
|||||||
Residential |
3,094.3 |
3,454.5 |
3,274.4 | ||||
Business |
605.1 |
574.2 |
589.7 | ||||
Multi Family |
252.4 |
269.1 |
257.8 | ||||
Industrial |
1.8 |
1.8 |
1.8 | ||||
Public Authority |
359.9 |
489.5 |
402.1 | ||||
Other |
21.6 |
27.5 |
23.5 | ||||
Total |
4,335.1 |
4,816.6 |
4,549.3 | ||||
Los Altos |
|||||||
Residential |
3,965.9 |
4,691.8 |
4,328.9 | ||||
Business |
1,125.9 |
1,120.5 |
1,123.2 | ||||
Multi Family |
294.1 |
317.7 |
301.8 | ||||
Industrial |
19.4 |
17.4 |
18.7 | ||||
Public Authority |
238.6 |
298.7 |
258.2 | ||||
Other |
3.7 |
3.1 |
3.5 | ||||
Total |
5,647.6 |
6,449.2 |
6,034.3 | ||||
Marysville |
|||||||
Residential |
66.0 |
79.6 |
72.8 | ||||
Business |
308.0 |
324.5 |
316.3 | ||||
Multi Family |
145.1 |
141.1 |
143.8 | ||||
Industrial |
26.9 |
34.2 |
29.3 | ||||
Public Authority |
95.3 |
108.8 |
99.7 | ||||
Other |
0.3 |
0.4 |
0.3 | ||||
Total |
641.6 |
688.6 |
662.2 | ||||
Mid Peninsula |
|||||||
Residential |
4,284.7 |
4,695.2 |
4,490.0 | ||||
Business |
1,429.2 |
1,478.4 |
1,453.8 | ||||
Multi Family |
1,034.8 |
1,055.5 |
1,041.5 | ||||
Industrial |
66.9 |
67.2 |
67.0 | ||||
Public Authority |
355.6 |
375.9 |
362.2 | ||||
Other |
26.1 |
36.3 |
29.4 | ||||
Total |
7,197.3 |
7,708.5 |
7,443.9 | ||||
2002 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
Salinas |
|||||||
Residential |
3,860.1 |
4,241.6 |
4,050.9 | ||||
Business |
2,367.0 |
2,410.4 |
2,388.7 | ||||
Multi Family |
717.6 |
718.6 |
717.9 | ||||
Industrial |
477.0 |
474.6 |
476.2 | ||||
Public Authority |
342.1 |
328.1 |
337.5 | ||||
Other |
47.9 |
57.9 |
51.2 | ||||
Total |
7,811.7 |
8,231.2 |
8,022.4 | ||||
Stockton |
|||||||
Residential |
6,728.9 |
7,260.8 |
6,994.9 | ||||
Business |
2,512.1 |
2,591.2 |
2,551.7 | ||||
Multi Family |
1,068.7 |
1,004.6 |
1,047.8 | ||||
Industrial |
1,954.4 |
2,091.3 |
1,999.5 | ||||
Public Authority |
1,175.4 |
1,133.4 |
1,161.7 | ||||
Other |
11.2 |
13.5 |
11.9 | ||||
Total |
13,450.7 |
14,094.8 |
13,767.5 | ||||
Visalia |
|||||||
Residential |
2,477.1 |
2,855.5 |
2,666.3 | ||||
Business |
2,529.0 |
2,554.2 |
2,541.6 | ||||
Multi Family |
412.2 |
412.2 |
412.2 | ||||
Industrial |
235.7 |
245.6 |
238.9 | ||||
Public Authority |
414.6 |
382.2 |
404.0 | ||||
Other |
129.4 |
168.1 |
142.0 | ||||
Total |
6,198.0 |
6,617.8 |
6,405.0 | ||||
Westlake |
||||||||
Residential |
2,212.3 |
2,523.0 |
2,367.7 | |||||
Business |
847.9 |
1,009.3 |
928.6 | |||||
Multi Family |
96.5 |
106.1 |
99.6 | |||||
Industrial |
30.9 |
31.6 |
31.1 | |||||
Public Authority |
136.2 |
152.2 |
141.4 | |||||
Other |
4.0 |
3.8 |
3.9 | |||||
Reclaimed |
187.8 |
230.2 |
201.6 | |||||
Total |
3,515.6 |
4,056.2 |
3,773.9 | |||||
Willows |
||||||||
Residential |
229.5 |
229.0 |
229.3 | |||||
Business |
124.8 |
121.2 |
123.0 | |||||
Multi Family |
61.8 |
55.4 |
59.7 | |||||
Industrial |
- |
- |
- | |||||
Public Authority |
51.6 |
42.2 |
48.5 | |||||
Other |
- |
- |
- | |||||
Total |
467.7 |
447.8 |
460.5 | |||||
2003 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
Bear Gulch |
||||||||||
Residential |
4,201.7 |
5,032.9 |
4,617.3 | |||||||
Business |
651.3 |
657.3 |
654.3 | |||||||
Multi Family |
110.0 |
113.9 |
111.3 | |||||||
Industrial |
2.2 |
2.2 |
2.2 | |||||||
Public Authority |
90.5 |
112.8 |
97.8 | |||||||
Other |
4.6 |
5.8 |
5.0 | |||||||
Total |
5,060.3 |
5,924.9 |
5,487.9 | |||||||
Chico |
||||||||||
Residential |
2,397.5 |
2,604.2 |
2,500.9 |
|||||||
Business |
2,543.5 |
2,502.2 |
2,522.9 | |||||||
Multi Family |
1,062.0 |
1,028.1 |
1,050.9 | |||||||
Industrial |
145.7 |
142.5 |
144.7 | |||||||
Public Authority |
474.4 |
589.1 |
511.8 | |||||||
Other |
20.2 |
19.8 |
20.1 | |||||||
Total |
6,643.3 |
6,885.9 |
6,751.3 | |||||||
Dixon |
||||||||||
Residential |
574.1 |
609.8 |
592.0 |
|||||||
Business |
57.9 |
54.7 |
56.3 |
|||||||
Multi Family |
32.6 |
39.9 |
35.0 |
|||||||
Industrial |
0.3 |
0.3 |
0.3 |
|||||||
Public Authority |
15.2 |
18.9 |
16.4 |
|||||||
Other |
- |
- |
- |
|||||||
Total |
680.1 |
723.6 |
700.0 |
|||||||
East Los Angeles |
||||||||||
Residential |
3,937.9 |
4,092.9 |
4,015.4 |
|||||||
Business |
2,538.1 |
2,521.4 |
2,529.8 |
|||||||
Multi Family |
186.8 |
192.1 |
188.5 |
|||||||
Industrial |
1,497.5 |
1,540.2 |
1,511.4 |
|||||||
Public Authority |
846.0 |
696.9 |
797.4 |
|||||||
Other |
5.9 |
4.1 |
5.3 |
|||||||
Total |
9,012.2 |
9,047.6 |
9,047.8 |
|||||||
Hermosa-Redondo |
||||||||||
Residential |
3,323.9 |
3,610.0 |
3,467.0 | |||||||
Business |
888.2 |
943.3 |
915.8 | |||||||
Multi Family |
1,088.9 |
1,211.0 |
1,128.7 | |||||||
Industrial |
245.2 |
245.2 |
245.2 | |||||||
Public Authority |
265.8 |
279.2 |
270.2 | |||||||
Other |
4.3 |
6.8 |
5.1 | |||||||
Reclaimed |
99.1 |
99.1 |
99.1 | |||||||
Total |
5,915.4 |
6,394.6 |
6,131.1 | |||||||
2003 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
King City |
|||||||
Residential |
398.4 |
404.5 |
401.5 | ||||
Business |
257.8 |
254.9 |
256.4 | ||||
Multi Family |
41.8 |
32.0 |
38.6 | ||||
Industrial |
63.3 |
78.3 |
68.2 | ||||
Public Authority |
31.3 |
40.5 |
34.3 | ||||
Other |
5.3 |
3.4 |
4.7 | ||||
Irrigation |
0.5 |
0.5 |
0.5 | ||||
Total |
798.4 |
814.1 |
804.2 | ||||
Livermore |
|||||||
Residential |
3,130.5 |
3,495.0 |
3,312.8 | ||||
Business |
636.8 |
598.0 |
617.4 | ||||
Multi Family |
252.4 |
269.1 |
257.8 | ||||
Industrial |
1.8 |
1.8 |
1.8 | ||||
Public Authority |
359.9 |
525.9 |
414.0 | ||||
Other |
21.6 |
30.0 |
24.3 | ||||
Total |
4,403.0 |
4,919.8 |
4,628.1 | ||||
Los Altos |
|||||||
Residential |
3,981.1 |
4,709.8 |
4,345.5 | ||||
Business |
1,138.5 |
1,125.8 |
1,132.2 | ||||
Multi Family |
294.8 |
320.4 |
303.1 | ||||
Industrial |
19.4 |
17.4 |
18.7 | ||||
Public Authority |
233.6 |
309.8 |
258.4 | ||||
Other |
3.7 |
2.9 |
3.4 | ||||
Total |
5,671.1 |
6,486.1 |
6,061.3 | ||||
Marysville |
|||||||
Residential |
67.0 |
80.9 |
74.0 | ||||
Business |
308.6 |
324.0 |
316.3 | ||||
Multi Family |
147.7 |
143.2 |
146.2 | ||||
Industrial |
26.9 |
34.2 |
29.3 | ||||
Public Authority |
96.3 |
111.7 |
101.3 | ||||
Other |
0.3 |
0.4 |
0.3 | ||||
Total |
646.8 |
694.4 |
667.4 | ||||
Mid Peninsula |
|||||||
Residential |
4,286.9 |
4,697.6 |
4,492.3 | ||||
Business |
1,431.4 |
1,480.6 |
1,456.0 | ||||
Multi Family |
1,044.2 |
1,068.0 |
1,052.0 | ||||
Industrial |
66.9 |
67.2 |
67.0 | ||||
Public Authority |
355.6 |
378.2 |
363.0 | ||||
Other |
26.1 |
39.8 |
30.6 | ||||
Total |
7,211.1 |
7,731.4 |
7,460.9 | ||||
2003 TOTAL SALES (KCcf)
ORIGINAL JOINT
CWS ORA POSITION
Salinas |
|||||||
Residential |
3,934.9 |
4,347.7 |
4,141.3 | ||||
Business |
2,521.9 |
2,518.1 |
2,520.0 | ||||
Multi Family |
722.3 |
718.6 |
721.1 | ||||
Industrial |
477.0 |
474.6 |
476.2 | ||||
Public Authority |
342.1 |
326.3 |
336.9 | ||||
Other |
47.9 |
61.7 |
52.4 | ||||
Total |
8,046.1 |
8,447.0 |
8,247.9 | ||||
Stockton |
|||||||
Residential |
6,760.5 |
7,294.8 |
7,027.7 | ||||
Business |
2,521.1 |
2,600.4 |
2,560.8 | ||||
Multi Family |
1,077.8 |
1,004.6 |
1,053.9 | ||||
Industrial |
1,974.7 |
2,091.3 |
2,012.7 | ||||
Public Authority |
1,175.4 |
1,140.8 |
1,164.1 | ||||
Other |
11.2 |
14.7 |
12.3 | ||||
Total |
13,520.7 |
14,146.6 |
13,831.5 | ||||
Visalia |
|||||||
Residential |
2,589.2 |
3,022.9 |
2,806.1 | ||||
Business |
2,607.9 |
2,597.4 |
2,602.7 | ||||
Multi Family |
426.2 |
426.2 |
426.2 | ||||
Industrial |
246.3 |
253.1 |
248.5 | ||||
Public Authority |
427.6 |
391.3 |
415.8 | ||||
Other |
129.4 |
179.6 |
145.8 | ||||
Total |
6,426.6 |
6,870.5 |
6,645.1 | ||||
Westlake |
|||||||
Residential |
2,205.7 |
2,536.6 |
2,371.2 | ||||
Business |
847.9 |
1,018.2 |
933.1 | ||||
Multi Family |
93.9 |
106.1 |
97.9 | ||||
Industrial |
30.9 |
31.6 |
31.1 | ||||
Public Authority |
136.2 |
155.5 |
142.5 | ||||
Other |
4.0 |
3.8 |
3.9 | ||||
Reclaimed |
187.8 |
244.6 |
206.3 | ||||
Total |
3,506.4 |
4,096.4 |
3,786.0 | ||||
Willows |
|||||||
Residential |
235.2 |
232.4 |
233.8 | ||||
Business |
125.8 |
121.2 |
123.5 | ||||
Multi Family |
63.2 |
55.4 |
60.7 | ||||
Industrial |
- |
- |
- | ||||
Public Authority |
52.0 |
42.2 |
48.8 | ||||
Other |
- |
- |
- | ||||
Total |
476.2 |
451.2 |
466.8 | ||||
Joint Recommendation Weather Adjustments
Normal Weather Values Coefficients
Temperature Rainfall Temperature Rainfall
Bear Gulch 58.02 13.72
Residential 5.300 -2.247
Business 5.984 -3.235
Multi Family 0.993 -4.133
Public Authority 43.728 -19.575
Chico 60.97 19.23
Residential 3.503 -1.678
Business 16.250 -2.128
Multi Family 63.376 -3.630
Public Authority 14.290 -19.230
Dixon 60.51 15.12
Residential 0.323 -1.245
Business 4.624 -3.906
Multi Family 3.546 -5.159
Public Authority - -3.287
East Los Angeles 66.53 11.91
Residential 1.773 -0.781
Business 2.963 -1.463
Multi Family 2.215 -2.865
Public Authority 61.763 -29.980
Hermosa-Redondo 63.16 11.75
Residential 3.090 -0.749
Business 9.509 -1.552
King City 59.24 11.09
Residential 5.641 -1.362
Business 4.001 -6.442
Multi Family 4.011 -12.927
Public Authority 16.016 -10.825
Livermore 59.83 13.50
Residential 5.175 -0.977
Business 7.811 -2.586
Multi Family 65.194 -0.417
Public Authority 118.829 -32.740
Joint Recommendation Weather Adjustments
Normal Weather Values Coefficients
Temperature Rainfall Temperature Rainfall
Los Altos 60.50 13.39
Residential 5.650 -2.017
Business 22.781 -6.759
Multi Family 56.774 11.930
Public Authority 76.988 -27.703
Marysville 62.89 17.43
Residential 2.889 -1.633
Business 4.944 -1.111
Multi Family 48.769 -3.030
Public Authority 38.430 -15.793
Mid Peninsula 57.55 15.82
Residential 2.631 -0.838
Business 7.309 -3.277
Multi Family 26.841 -2.845
Public Authority 31.955 -6.116
Salinas 58.10 13.42
Residential 2.721 -1.266
Business -1.803
Multi Family 28.087 -4.259
Public Authority 55.302 -23.679
Stockton 60.17 14.51
Residential 0.164 -1.254
Business 4.770 -1.895
Multi Family -3.435
Public Authority -39.540
Visalia 63.10 10.65
Residential 6.656 -3.066
Business 5.870 -2.920
Multi Family 40.078 -6.460
Public Authority 56.442 -8.721
Joint Recommendation Weather Adjustments
Normal Weather Values Coefficients
Temperature Rainfall Temperature Rainfall
Westlake 64.30 12.62
Residential 5.644 -3.661
Business -40.934
Multi Family -3.696
Public Authority 33.988 -27.895
Willows 60.21 15.25
Residential -1.098
Business -1.004
Public Authority -13.560
(End of Attachment B)
Attachment C
Joint Recommendation
for Calculation of Reclaimed Water Rates
Application 01-09-062 et al.
California Water Service Company
1. Beginning with the revenue requirement adopted by the Commission in this proceeding, and 2002 tariff rates calculated using the method proposed by California Water Service Company (Cal Water), subtract 20% discounts to: (a) the tariff volumetric rate less the wholesale rate for reclaimed water paid by Cal Water, and (b) the tariff service charge.
2. The resulting 2002 volumetric rate shall not be lower than the current volumetric rate of $1.4512 per hundred cubic feet (ccf), and the resulting service charge shall not be lower than the current service charge of $251.00 per month.
3. When Cal Water receives a 2003 step increase, and 2004 and/or 2005 attrition increases, the reclaimed water rates shall be recalculated. The floor volumetric rate and service charge shall be the reclaimed water rates in effect prior to the step or attrition increases.
4. The volumetric rate, including the 20% discount, shall be recalculated if the Commission approves any change to the wholesale rate for reclaimed water paid by Cal Water.
5. Northern Ranch Country Club withdraws its recommendation that Cal Water be required to submit a comprehensive cost allocation study in its next rate proceeding.
6. The "Direct Testimony of John H. Mook on Behalf of North Ranch Country Club," including accompanying exhibits, and any related rebuttal testimony shall be received into evidence subject to future cross-examination if for any reason cross-examination becomes necessary.
7. This joint recommendation is supported by all parties to this proceeding: Cal Water, the Office of Ratepayer Advocates, North Ranch Country Club and Aglet Consumer Alliance.
Example Reclaimed Water Calculations
1. The reclaimed water discount will be calculated as follows, where:
(a) Wholesale reclaimed water rate paid by Cal Water to Calleguas =
$402 per acre-foot / 435.6 ccf per acre-foot = $0.9229 per ccf;
(b) Present volumetric rate for reclaimed water = $1.4512 per ccf;
(c) Proposed volumetric rate for reclaimed water = $1.5953 per ccf;
(d) Present monthly service charge = $251.00; and
(e) Proposed monthly service charge = $349.35.
2. If the Commission adopts Cal Water's requested revenue requirement for 2002, the joint recommendation for the volumetric rate would be:
$1.5953 - 20% x ($1.5953 - $0.9229) = $1.4608 per ccf,
which is higher than the floor rate of $1.4512 per ccf.
The joint recommendation for the service charge for 2002 would be:
$349.35 x (1 - 20%) = $279.48 per month,
which is also higher that the floor rate of $251.00 per month.
3. Then if Cal Water is authorized a 3% step increase for 2003, the volumetric rate before the discount would be approximately:
$1.5953 + 3% x ($1.5953 - $0.9229) = $1.6155 per ccf.
The volumetric rate after the discount would be:
$1.6155 - 20% x ($1.6155 - $0.9229) = $1.4770 per ccf,
which is higher than the new floor rate of $1.4608 per ccf.
Expressed differently, the volumetric rate after the discount would be:
$1.4608 + (1- 20%) x ($1.6155 - $1.5953) = $1.4770 per ccf.
The result is the same.
The service charge before the discount would be approximately:
103% x $349.35 = $359.83 per month.
The service charge after the discount would be:
$359.83 x (1 - 20%) = $287.86 per month,
which is also higher than the new floor rate of $279.48 per month.
Calculations for subsequent attrition years would be similar.
4. If the Commission were to adopt 60% of Cal Water's requested relief for 2002, the volumetric rate before the discount would be approximately:
$1.4512 + 60% x ($1.5953 - $1.4512) = $1.5377 per ccf.
The volumetric rate after the discount would be:
$1.5377 - 20% x ($1.5377 - $0.9229) = $1.4147 per ccf,
which is lower than the floor rate of $1.4512 per ccf. Therefore the floor rate would prevail.
The service charge before the discount would be approximately:
$251.00 + 60% x ($349.35 - $251.00) = $310.01 per month.
The service charge after the discount would be:
$310.01 x (1 - 20%) = $248.01 per month,
which is also lower than the floor rate of $251.00 per month. Therefore, the floor rate would prevail.
* * *
Dollars at Stake
Potential 2002 discount for North Ranch Country Club =
203,225 ccf (2001 usage) x ($1.5953 - $1.4608 ) + 0.2 x $349.35 x 12 = $27,334 + $838 = $28,172
Compare to 2001 total annual bill = $390,831 or undiscounted revenue at present rates = 203,225 x $1.4512 + $251 x 12 = $297,932. The value of the discount will be less than 10% of annual bills for North Ranch Country Club.
(End of Attachment C)
Attachment D
§ 789.1. Legislative findings and declarations
The Legislature finds and declares all of the following:
(a) Water corporations currently are faced with, and will continue to be faced with, increasing demands for new infrastructure, plant, and facilities to comply with increasingly strict state and federal safe drinking water laws and regulations.
(b) The state's limited water supply will require investment by water corporations in infrastructure, plant, and facilities to develop new sources of supply, make existing sources of supply more reliable, and encourage and implement water conservation measures including water reclamation and reuse.
(c) Water corporations also are faced with the need to replace or upgrade water infrastructure, plant, and facilities and to design and construct all of those replacements and improvements to meet the governing fire flow standards for public fire protection purposes.
(d) Water corporations may, from time to time, own real property that once was, but is no longer, necessary or useful in the provision of water utility service and that now may be sold. It is the policy of the state that water corporations be encouraged to dispose of real property that once was, but is no longer, necessary or useful in the provision of water utility service and to invest the net proceeds therefrom in utility infrastructure, plant, facilities, and properties that are necessary or useful in the provision of water service to the public.
(e) It is the policy of the state that any net proceeds from the sale by a water corporation of real property that was at any time, but is no longer, necessary or useful in the provision of public utility service, shall be invested by a water corporation in infrastructure, plant, facilities, and properties that are necessary or useful in the performance of its duties to the public and that all of that investment in infrastructure, plant, facilities, and properties shall be included among the other utility property of the water corporation that is used and useful in providing water service and upon which the commission authorizes the water corporation the opportunity to earn a reasonable return.
§ 790. Investment in water system infrastructure
(a) Whenever a water corporation sells any real property that was at any time, but is no longer, necessary or useful in the performance of the water corporation's duties to the public, the water corporation shall invest the net proceeds, if any, including interest at the rate that the commission prescribes for memorandum accounts, from the sale in water system infrastructure, plant, facilities, and properties that are necessary or useful in the performance of its duties to the public. For purposes of tracking the net proceeds and their investment, the water corporation shall maintain records necessary to document the investment of the net proceeds pursuant to this article. The amount of the net proceeds shall be a water corporation's primary source of capital for investment in utility infrastructure, plant, facilities, and properties that are necessary or useful in the performance of the water corporation's duties in providing water utility service to the public.
(b) All water utility infrastructure, plant, facilities, and properties constructed or acquired by, and used and useful to, a water corporation by investment pursuant to subdivision (a) shall be included among the water corporation's other utility property upon which the commission authorizes the water corporation the opportunity to earn a reasonable return.
(c) This article shall apply to the investment of the net proceeds referred to in subdivision (a) for a period of 8 years from the end of the calendar year in which the water corporation receives the net proceeds. The balance of any net proceeds and interest thereon that is not invested after the eight-year period shall be allocated solely to ratepayers.
(d) Upon application by a water corporation with 10,000 or fewer service connections, the commission may, after a hearing, by rule or order, exempt the water corporation from the requirements of this article.
(e) The commission retains continuing authority to determine the used, useful, or necessary status of any and all infrastructure improvements and investments.
(End of Attachment D)
Attachments E thru X
Tables
