Commission Conference Agenda

FLORIDA PUBLIC SERVICE COMMISSION

COMMISSION CONFERENCE AGENDA

CONFERENCE DATE AND TIME: January 4, 2005, 9:30 a.m.

LOCATION: Room 148, Betty Easley Conference Center

DATE ISSUED: December 22, 2004

NOTICE

Persons affected by Commission action on certain items on this agenda for which a hearing has not been held (other than actions on interim rates in file and suspend rate cases) may be allowed to address the Commission when those items are taken up for discussion at this conference. These items are designated by double asterisks (**) next to the agenda item number.

Included in the above category are items brought before the Commission for tentative or proposed action which will be subject to requests for hearing before becoming final. These actions include all tariff filings, items identified as proposed agency action (PAA), show cause actions and certain others.

To obtain a copy of staff’s recommendation for any item on this agenda, contact the Division of the Commission Clerk and Administrative Services at (850) 413‑6770. There may be a charge for the copy. The agenda and recommendations are also accessible on the PSC Homepage, at http://www.floridapsc.com, at no charge.

Any person requiring some accommodation at this conference because of a physical impairment should call the Division of the Commission Clerk and Administrative Services at (850) 413‑6770 at least 48 hours before the conference. Any person who is hearing or speech impaired should contact the Commission by using the Florida Relay Service, which can be reached at 1‑800‑955‑8771 (TDD). Assistive Listening Devices are available in the Division of the Commission Clerk and Administrative Services, Betty Easley Conference Center, Room 110.

Video and audio versions of the conference are available and can be accessed live on the PSC Homepage on the day of the Conference. The audio version is available through archive storage for up to three months afterward.

1 Approval of Minutes
November 30, 2004 Regular Commission Conference
December 7, 2004 Regular Commission Conference

2 ** Consent Agenda

PAA A) Applications for certificates to provide competitive local exchange telecommunications service.

DOCKET NO.	COMPANY NAME
040251‑TX	Twenty Eight Red, Inc. d/b/a Cash America
041331‑TX	New Rochelle Telephone Corp.
041200‑TX	Economic Telecom, Inc.
041201‑TX	NETLINE COMMUNICATIONS CORP.

PAA B) Applications for certificates to provide pay telephone service.

DOCKET NO.	COMPANY NAME
041329‑TC	Dean Newell
041330‑TC	James Larman
041343‑TC	Candy Fawley
041372‑TC	Mahmoud El-Yaman
041290‑TC	Symtelco, LLC

RECOMMENDATION: The Commission should approve the action requested in the dockets referenced above and close these dockets.

3 Docket No. 040763–TP – Request for submission of proposals for relay service, beginning in June 2005, for the hearing and speech impaired, and other implementation matters in compliance with the Florida Telecommunications Access System Act of 1991.

Critical Date(s):		5/31/05 (Current contract with Sprint expires on this date.)
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Davidson
Staff:	CMP: Moses, Casey GCL: Rojas

(Participation limited to Commissioners and staff.)

Issue 1: Should the Commission select Sprint as the relay service provider and direct the Commission’s Executive Director to: (1) issue the attached letter of intent (Attachment A, Page 9 of staff’s December 21, 2004 memorandum) notifying all bidders of the Commission’s decision to award a three-year contract to Sprint to be the provider of the statewide telecommunications relay service in Florida; and (2) finalize and sign a contract with Sprint to provide the Florida Relay Service?

Recommendation: Yes. Based upon the RFP evaluation process, the Commission should select Sprint as the relay provider and direct the Commission’s Executive Director to: (1) issue the letter of intent notifying all bidders that Sprint has been awarded a three-year contract as the provider of the statewide telecommunications relay service in Florida; and (2) finalize and sign a contract with Sprint to provide the Florida Relay Service.

Issue 2: Should this docket be closed?

Recommendation: No. This docket should remain open for the life of the contract.

4 Docket No. 041211–TP – Petition for declaratory statement by Smart City Telecommunications LLC d/b/a Smart City Telecom to determine application of term "subscriber" or "customer" as contemplated by Rule 25-4.003(50), F.A.C.

Critical Date(s):		1/16/05 (By statute, order must be issued by this date.)
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Edgar
Staff:	GCL: Cibula CMP: King

(Parties may participate at Commission's discretion.)

Issue 1: Should the Commission grant Smart City’s Petition for Declaratory Statement and provide a determination as to whether Mr. Keith Kropp or Main Street Realtors was the original subscriber or customer of the Smart City account at issue pursuant to Rule 25-4.003(50), Florida Administrative Code?

Recommendation: Yes. The Commission should grant Smart City’s petition and declare that, based on the facts as set forth in Smart City’s petition, Main Street Realtors was the original subscriber or customer of the Smart City account.

Issue 2: Should this docket be closed?

Recommendation: Yes. No further action is required; therefore, this docket should be closed.

5 Docket No. 020896–WS – Petition by customers of Aloha Utilities, Inc. for deletion of portion of territory in Seven Springs area in Pasco County.
Docket No. 010503–WU – Application for increase in water rates for Seven Springs System in Pasco County by Aloha Utilities, Inc.

Critical Date(s):		None
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Baez (010503-WU) Bradley (020896-WS)
Staff:	GCL: Cibula ECR: Devlin

(Participation dependent on Commission's vote on Issues 1 and 3.)

Issue 1: Should the Commission grant Aloha’s Request for Oral Argument on its Motion for Termination of Proceedings?

Recommendation: Yes. Aloha’s Request for Oral Argument on its Motion for Termination of Proceedings should be granted. Each side should be given ten minutes to address the Commission.

Issue 2: Should the Commission grant Aloha’s Motion for Deletion of Proceedings as They Relate to Deletion of Territory?

Recommendation: Yes. Aloha’s motion should be granted.

Issue 3: Should Aloha’s Request for Oral Argument in regard to its Motion for Reconsideration of Order No. PSC-04-1152-PCO-WS (the Discovery Order) be granted?

Recommendation: If the Commission votes to approve advisory staff’s recommendation on Issue 2, Aloha’s Request for Oral Argument would be moot. However, even if the Commission denies advisory staff’s recommendation on Issue 2, Aloha’s Request for Oral Argument should be denied.

Issue 4: Should Aloha’s Motion for Reconsideration of Order No. PSC-04-1152-PCO-WS (the Discovery Order) be granted?

Recommendation: If the Commission votes to approve advisory staff’s recommendation on Issue 2, Aloha’s Motion for Reconsideration of Order No. PSC-04-1152-PCO-WS would be moot. However, even if the Commission denies advisory staff’s recommendation on Issue 2, the motion for reconsideration should be denied. Aloha should provide the information requested in POD No. 1, as set forth in Order No. PSC-04-1152-PCO-WS, within 5 days of the Commission’s vote on this motion.

Issue 5: Should these dockets be closed?

Recommendation: If the Commission approves advisory staff’s recommendation on Issue 2, Docket No. 020896-WS should be closed and the customer hearing scheduled for January 27-28, 2005, should be cancelled. If the Commission denies advisory staff’s recommendation on Issue 2, Docket No. 020896-WS should remain open. In either event, Docket No. 010503-WU should remain open to proceed to hearing on the protest to the order relating to the measurement of water quality.

6 ** Docket No. 020896–WS – Petition by customers of Aloha Utilities, Inc. for deletion of portion of territory in Seven Springs area in Pasco County.

Critical Date(s):		None
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Bradley
Staff:	GCL: Gervasi, Helton ECR: Fletcher, Stallcup

Issue 1: What action, if any, should the Commission take in the event that Aloha’s Motion for Termination is granted?

Primary Staff Recommendation: If the Commission votes to grant Aloha’s Motion for Termination, the Commission must determine whether there is probable cause to believe that Aloha has violated a statute, rule, or order that warrants the imposition of a penalty. Primary staff recommends that the Commission should decline to initiate deletion proceedings against Aloha because there is not probable cause to believe that Aloha has violated a statute, rule, or order that warrants the imposition of a penalty. Because Aloha provides potable water which meets all state and federal drinking water standards up to the point of connection to its customers’ meters, primary staff does not believe that the facts relating to Aloha’s provision of water service to Trinity, Riviera Estates, Villa del Rio, and Riverside Village Unit 4 provide probable cause that Aloha has violated its statutory duty under section 367.111(2), Florida Statutes, to provide service to customers in those areas that “shall not be . . . less sufficient than is consistent with . . . the reasonable and proper operation of the utility system in the public interest.” Aloha should be required to continue to submit monthly project status reports up to the time of implementation of the treatment standard imposed by Order No. PSC-04-0712-PA-WS. Alternate Staff Recommendation: If the Commission votes to grant Aloha’s Motion for Termination, the Commission must determine whether there is probable cause to believe that Aloha has violated a statute, rule, or order that warrants the imposition of a penalty. Alternate staff believes the facts relating to Aloha’s provision of water service to Trinity (south of Mitchell Boulevard and east of Seven Springs Boulevard), Riviera Estates, Villa del Rio, and Riverside Village Unit 4 provide probable cause that Aloha has violated its statutory duty under section 367.111(2), Florida Statutes, to provide service to customers in those areas that “shall not be . . . less sufficient than is consistent with . . . the reasonable and proper operation of the utility system in the public interest.” Alternate staff recommends that the appropriate penalty pursuant to section 367.161(2), Florida Statutes, for such statutory violation is to amend or partially revoke Aloha’s Water Certificate No. 136-W to delete these insufficiently served areas from its service territory. The Commission’s decision to revoke any portion of Aloha’s certificated territory should be made contingent upon provisions being made for an alternative service provider to be in place. Procedurally, alternate staff recommends that the Commission open a new docket for this deletion proceeding, provide 30 days’ notice of the initiation of such action pursuant to section 367.045(6), and, at the expiration of that 30 days, issue the Order to Show Cause appended to this recommendation as Attachment C, to initiate the deletion proceeding and provide a point of entry for Aloha to request a hearing. The requisite notice should be served on Aloha by personal service or certified mail, and submitted for the next available publication of the Florida Administrative Weekly and to a newspaper of general circulation in the area affected within seven days of the Commission’s vote on the matter.

7 Docket No. 041272–EI – Petition for approval of storm cost recovery clause for recovery of extraordinary expenditures related to Hurricanes Charley, Frances, Jeanne, and Ivan, by Progress Energy Florida, Inc.

Critical Date(s):		None
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Davidson
Staff:	GCL: Brubaker, Rodan ECR: Slemkewicz, Willis

(Motion to dismiss - oral argument has not been requested, but may be heard at the Commission's discretion.)

Issue 1: Should the joint Motion to Dismiss filed by OPC and FIPUG be granted?

Recommendation: No. The Motion to Dismiss should be denied.

Issue 2: Should the docket be closed?

Recommendation: No. If the Commission votes in favor of staff’s recommendation in Issue 1, the docket should remain open to accommodate the hearing currently scheduled in this docket.

8 Docket No. 041291–EI – Petition for authority to recover prudently incurred storm restoration costs related to 2004 storm season that exceed storm reserve balance, by Florida Power & Light Company.

Critical Date(s):		1/19/05 (60-day suspension date) - Issue 4
Commissioners Assigned:			All Commissioners
Prehearing Officer:			Davidson
Staff:	ECR: Slemkewicz, Willis, Kummer, Wheeler, Maurey GCL: C. Keating

(Issues 1, 2 - decision prior to hearing - motions to dismiss/strike - oral argument not requested, but may be heard at the Commission's discretion; Issues 3, 4, 5 - decision prior to hearing - parties may participate.)

Issue 1: Should the Commission grant OPC and FIPUG’s joint motion to dismiss FPL’s Storm Cost Recovery Petition?

Recommendation: No. The motion to dismiss should be denied. FPL’s petition states a cause of action upon which relief may be granted.

Issue 2: Should the Commission grant OPC and FIPUG’s joint request to strike or dismiss FPL’s Preliminary Surcharge Petition?

Recommendation: No. The Commission should deny OPC and FIPUG’s joint request to strike or dismiss FPL’s Preliminary Surcharge Petition.

Issue 3: Should the Commission authorize FPL to implement a preliminary storm surcharge subject to refund?

Recommendation: Yes. If the motions to dismiss/strike are denied, FPL should be authorized to implement a preliminary surcharge, subject to refund. This approval would be preliminary in nature and would not prejudge the merits of any issues that may be raised in the evidentiary hearing in this docket, such as the implementation of any surcharge, any amounts to be recovered, or the duration of any surcharge.

Issue 4: Should the Commission approve FPL’s proposed Original Tariff Sheet No. 8.033?

Recommendation: If the Commission approves staff’s recommendation in Issue 3, the tariff as filed should be approved and remain in effect until the final order is issued in this docket. The appropriate allocation of the costs to rate classes and the resulting rate factors should be an issue in the hearing scheduled for April. Consistent with the application of interim rates, the tariff should become effective for meter readings on or after February 3, 2005. If the Commission denies FPL’s request to implement the storm damage surcharge subject to refund prior to the hearing, the proposed tariff sheet should be suspended, pending the results of the scheduled hearing.

Issue 5: What is the appropriate security to guarantee the amount collected subject to refund through the storm surcharge?

Recommendation: The appropriate security to guarantee the amount collected subject to refund through the storm surcharge is a corporate undertaking.

Issue 6: Should this docket be closed?

Recommendation: No. This docket should remain open.

9 Docket No. 040001–EI – Fuel and purchased power cost recovery clause with generating performance incentive factor.

Critical Date(s):		None
Commissioners Assigned:			Baez, Deason, Bradley, Davidson (for purposes of this decision only)
Prehearing Officer:			Bradley
Staff:	ECR: Haff, Ballinger GCL: Vining, C. Keating

(Participation is limited to Commissioners and staff.)

Issue 14C: Should the Commission approve the three UPS agreements between FPL and Southern Company for cost recovery purposes?

Primary Recommendation: No. The new UPS agreements between FPL and Southern Company are not cost-effective. FPL’s own analysis indicates that the new UPS agreements are between $69 million and $93 million more costly than FPL’s self-build alternative. However, in staff’s opinion, a more realistic cost difference is $117 million because FPL over-estimated the potential for coal-fired economy energy purchases from Southern Company.

Alternate Recommendation: Yes. The new UPS agreements provide certain benefits, some of which are difficult to quantify. The primary benefit of the new UPS agreements is FPL’s retention of firm transmission rights within the Southern system. Staff recommends, as a condition of approval, that any gain on sales to third parties that utilize the transmission rights associated with the UPS agreements should be credited 100% to FPL’s ratepayers. If FPL negotiates the purchase of additional coal capacity and energy from either the Miller or Scherer units, the same conditions should apply. In order to not penalize FPL, the gains on such sales should not be included in FPL’s calculation of a three-year rolling average for purposes of establishing the threshold for other economy sales pursuant to Order No. PSC-00-1744-PAA-EI.