2. Procedural Background
Cal-Am filed this application separately from its Monterey general rate case (GRC) A.08-01-027. Protests were timely filed by DRA and MPWMD. Public participation hearings were held in the Monterey District on May 28 and May 29, 2008. Following the PPHs, the Hidden Hills Subunit Ratepayers Association received intervenor status in this proceeding.3
In its application, Cal-Am requests authority to nearly quadruple the annual budget for its conservation programs, and to also spend an additional $2.9 million per year for rationing implementation costs. The total request for test year 2009 is $5.3 million. Recognizing that the conservation and water rationing programs are complex and expensive, and that Cal-Am is additionally asking for very substantial rate increases in its pending GRC proceeding, the assigned Commissioner issued a May 9, 2008 ruling adopting an early evaluation process to coordinate the review of this application and A.08-01-027.4
The assigned Commissioner and ALJ confirmed that good cause exists to consider Cal-Am's conservation and rationing programs in this proceeding, separate from the pending GRC application, in the June 27, 2008 Scoping Memo. The Scoping Memo also adopted a two-phase procedural schedule, with Phase 1 addressing proposed changes to Rule 14.1, interim emergency conservation rates, and procedures for sharing customer consumption data with MPWMD.5
Cal-Am's and MPWMD's proposed conservation programs were scheduled for Phase 2 in order to provide DRA and other parties additional time to comprehensively review the proposals.
Evidentiary hearings on Phase 2 conservation programs were held on November 12-14, 2008. Prior to the hearings, Cal-Am, DRA, and MPWMD served all parties with an agreement in principle. On January 16, 2009, Cal-Am, DRA, and MPWMD submitted this Settlement, which addresses all Phase 2 issues. On February 17, 2009, the Independent Reclaimed Water Users Group (IRWUG) submitted comments on the Settlement; Cal-Am responded to these comments on March 4, 2009.
On March 10, 2009, the same parties submitted another settlement that addresses the rationing stages of Rule 14.1; this proposed settlement will be considered in a later decision.
3 See Administrative Law Judge (ALJ) ruling on June 13, 2008.
4 In its Monterey District GRC filing, Cal-Am requests an 80.30% or $24,718,200 increase in 2009, an 11.72% increase in 2010, and a 12.25% increase in 2011. (See June 27, 2008 Scoping Memo in A.08-01-027, p. 6.)
5 Cal-Am's proposed Rule 14.1 contains three stages of mandatory conservation measures and four stages of mandatory rationing measures that Cal-Am will implement under specific conditions in order to maintain its production of water from the Monterey Peninsula Water Resource System below the legal limits set by the State Water Resource Control Board and the Monterey District Court.
