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DATE: |
November 7, 2007 |
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TO: |
Office of Commission Clerk (Cole) |
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FROM: |
Division of Economic Regulation (Walden) Office of the General Counsel (Jaeger) |
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RE: |
Docket No. 070362-WU – Application for amendment of Certificate No. 106-W to extend water service to include certain territory in Lake County adjacent to East Lake Harris - Friendly Center water system, and for approval of special developer's agreement, by Aqua Utilities Florida, Inc. County: Lake |
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AGENDA: |
11/20/07 – Regular Agenda – Proposed Agency Action (Issue 2) - Interested Persons May Participate |
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COMMISSIONERS ASSIGNED: |
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PREHEARING OFFICER: |
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SPECIAL INSTRUCTIONS: |
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FILE NAME AND LOCATION: |
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Aqua Utilities Florida, Inc. (Aqua or utility) is a Class A utility providing water and wastewater service in numerous counties in Florida. Rates were last considered in Docket No. 060368-WS, and that rate increase request was withdrawn by the utility. The filing in this docket is for the addition of nearly 30 acres of undeveloped land to its service area.
This application was filed June 6, 2007 to include the Harbor Isle subdivision, which is anticipated to begin development in late 2007. A special developer’s agreement is included in the filing. Special service availability agreements are filed when an agreement for charges for extension of service is not consistent with the utility’s service availability policy in its tariff.
The service area for both East Lake Harris and Friendly Center is in the St. Johns River Water Management District. The Commission has jurisdiction pursuant to Section 367.045, Florida Statutes (F.S.).
Issue 1: Should the Commission approve Aqua Utilities Florida Inc.’s application for amendment of Certificate No. 106-W?
Recommendation: Yes, the Commission should approve Aqua Utilities Florida, Inc.’s amendment application to amend Certificate No. 106-W. The proposed territory is described in Attachment A. The resultant order should serve as Aqua Utilities Florida, Inc.’s amended certificate and it should be retained by the utility. Aqua Utilities Florida, Inc. should charge the customers in the added territory the rates and chares contained in its tariff until authorized to change by this Commission in a subsequent proceeding. (Walden)
Staff Analysis: As stated earlier, the utility’s amendment application is to serve the Harbor Isle subdivision, a development comprised of 30.97 acres which will be built with manufactured homes. The development is expected to include 110 homes.
The application is in compliance with the governing statute, Section 367.045, F.S., and other pertinent statutes and administrative rules concerning an application for amendment of certificate. The utility provides water service from its wells at Friendly Center and East Lake Harris Estates, two systems that are interconnected. This area requested for amendment sits between Friendly Center and East Lake Harris Estates. Central wastewater service is not provided and the homes each will have a septic tank.
An adequate service territory map and territory description have been provided as prescribed by Rule 25-30.036(3)(e) and (i), Florida Administrative Code (F.A.C.). A description of the territory requested by the utility is appended to this recommendation as Attachment A. The utility has submitted an affidavit consistent with Section 367.045(2)(d), F.S., that it has tariffs and annual reports on file with the Commission. In addition, the application contains proof of compliance with the noticing provisions set forth in Rule 25-30.030, F.A.C. No objections to the application have been received and the time for filing such has expired. The local planning agency was provided notice of the application and did not file a protest to the amendment. The Department of Community Affairs has reviewed the filing and commented that the proposed expansion of territory is consistent with the City of Astatula’s Comprehensive Plan.
Staff recommends that the rates and charges approved by the Commission for Aqua’s service area be applied to the customers in the new service territory. The utility has filed revised tariff sheets incorporating the additional territory into its tariff.
Based upon the above information, staff recommends that the Commission should approve Aqua’s application to amend Certificate No. 106-W. The proposed territory amendment is described in Attachment A. The resultant order should serve as Aqua’s amended certificate and the order should be retained by the utility. Aqua should charge the customers in the added territory the rates and charges contained in its tariff until authorized to change by this Commission in a subsequent proceeding.
Issue 2: Should the Commission approve the special developer agreement filed by the developer and the utility?
Recommendation: Yes, staff recommends the special developer agreement and proposed accounting treatment be approved. (Walden)
Staff Analysis: Along with its amendment application, the utility filed a special developer service availability agreement. The agreement provides that the developer will construct the on-site water system including mains, service lines, curb stop and meter boxes, and convey those facilities over to Aqua for this development that will serve 90 homes and one commercial lot. Other payments made by the developer to the utility include CIAC charges for a meter installation charge, plant capacity charge, tap-in fee, main extension charge, and Allowance for Funds Prudently Invested (AFPI) charges for both the treatment plant and transmission and distribution system. Aqua will install the meters as homeowners close on their homes. Another provision is that the utility will rebate to the developer $900 as each new dwelling unit connects to the system within the development for ten years. After ten years, no more rebate payments will be made.
The proposed accounting treatment by Aqua is that the value of the donated lines will be recorded as donated property. As the service availability charges ($90 meter installation charge, $700 plant capacity charge, $143 tap-in fee, $446 main extension charge) are paid, the developer will be given a rebate of $900 per dwelling unit. The utility will offset the rebate against the main extension charge ($446) first, and offset the remaining balance of the rebate against the plant capacity charge ($454).
The guideline for CIAC is for water and wastewater utilities to recover as a maximum not more than 75% of net plant at design capacity and at a minimum to recover at least the value of facilities represented by the transmission and collection system (Rule 25-30.580, F.A.C.). The proposed agreement will meet the guidelines in Rule 25-30.580, F.A.C. because the full value of the donated lines will be recorded as CIAC which meets the minimum criteria.
The provision for a rebate of $900 to the developer from the utility as each dwelling unit connects to the water system is stated on the third page of the agreement under paragraph 1. The utility believes this rebate to offset the developer’s cost to the water system inside the development is warranted because it is an incentive to the developer to add more customers to its water system, and will avoid the proliferation of small systems.
Refunds by a utility are normally offered as a result of a refundable advance agreement pursuant to Rule 25-30.540(3), F.A.C. This arrangement occurs when a developer installs facilities that are oversized in order to make the project feasible, whether those oversized items are lines or plant capacity. Refunds are then made to the developer as additional users connect to the system that was oversized. No facilities are oversized in this docket, and therefore staff believes that refunds should be distinguished from rebates.
Staff recommends the special developer agreement and proposed accounting treatment be approved.
Issue 3: Should this docket be closed?
Recommendation: Yes, if a substantially affected person does not protest the proposed agency action portion of the Order within 21 days, a Consummating Order will be issued, and the docket will be closed. (Jaeger)
Staff Analysis: If a substantially affected person does not protest the proposed agency action portion of the Order within 21 days, a Consummating Order will be issued, and the docket will be closed.
AQUA UTILITIES FLORIDA, INC.
Description of Territory Served
Water Service Territory
Lake County
East Lake Harris Estates – Harbor Isle subdivision
In Township 20 South, Range 26 East, a portion of Section 29:
Commence at the North 1/4 corner of said Section 29, Township 20 South, Range 26 East; thence run N 88º57'27" W, along the North line of said Section 29 for a distance of 50.00 feet to a point on the West right-of-way line of Monroe Street; thence run S 00º46'56" W, a distance of 314.17 feet for a Point of Beginning; thence continue along said West right of way line, S 00º46'56" W, a distance of 958.56 feet; thence N 88º56'15" W, a distance of 1917.50 feet to a point on the East right of way line of Adams Street; thence N 00º50'39" E, along said East right of way line a distance of 610.80 feet; thence S 88º58'18" E, a distance of 583.71 feet; thence S 00º50'39" W a distance of 33.00 feet; thence S 88º58'18" E, a distance of 751.29 feet; thence N 00º48'05" E, a distance of 379.37 feet; thence S 88º59'45" E, a distance of 581.74 feet to the Point of Beginning.
Containing 30.97 acres, more or less.
FLORIDA PUBLIC SERVICE COMMISSION
authorizes
Aqua Utilities Florida, Inc.
pursuant to
Certificate Number 106-W
to provide water service in Lake County in accordance with the provisions of Chapter 367, Florida Statutes, and the Rules, Regulations, and Orders of this Commission in the territory described by the Orders of this Commission. This authorization shall remain in force and effect until superseded, suspended, canceled or revoked by Order of this Commission.
Order Number Date Issued Docket Number Filing Type
5573 11/03/72 C-72497-W Original Certificate
5595 12/07/72 C-72505-W Original Certificate
5666 03/06/73 C-72651-W Original Certificate
6801 07/25/75 750327-W (AP) Original Certificate
6928 09/30/75 750367-W Original Certificate
8075 12/02/77 770578-W (TC) Transfer/Amendment
8076 12/02/77 770577-W (TC) Transfer/Amendment
8144 01/25/78 770579-W (TC) Transfer/Amendment
8299 05/05/78 780057-WS (TC) Transfer/Amendment
9483 08/05/80 791043-W Transfer/Amendment
9635 11/14/80 800192-WS (AP) Original Certificate
9688 12/10/80 791043-W (TC) Amendatory
9988 05/05/81 780278-WS (TC) Transfer/Amendment
10109 06/29/81 800636-WS (TC) Transfer/Amendment
10109-A 07/31/81 800636-WS (MC) Amendatory
14115 02/21/85 840304-WS Original Certificate
15295 10/25/85 850695-WU Amendment
19575 06/27/88 870633-WS Transfer Certificate
20647 01/24/89 881011-WU Transfer/Amendment
20869 03/09/89 880605-WS Transfer/Amendment
21636 07/31/89 890348-WU Transfer/Amendment
23378 08/21/90 900106-WS Transfer/Amendment
23459 09/11/90 900227-WU Amendment
23505 09/18/90 900556-WU Amendment
23656 10/23/90 891320-WU Amendment
23852 12/10/90 900556-WU Affirm Amendment
24230 03/12/91 900702-WU Amendment
PSC-93-0754-FOF-WU 05/18/93 921044-WU Amendment
PSC-93-0754A-FOF-WU 06/07/93 921044-WU Amendatory
PSC-93-1150-FOF-WU 08/09/93 930129-WU Amendment
PSC-93-1306-FOF-WU 09/08/93 930129-WU Amendment
PSC-95-0268-FOF-WS 02/28/95 940091-WS Transfer/Amendment
PSC-96-0131-FOF-WS 01/29/96 950231-WS Amendment
Order Number Date Issued Docket Number Filing Type
PSC-96-0432-FOF-WU 03/28/96 950880-WU Transfer/Amendment
PSC-96-1409-FOF-WU 11/20/96 960716-WU Transfer Certificate
PSC-97-0375-FOF-WU 04/07/97 960793-WU Transfer/Amendment
PSC-97-0427-FOF-WS 04/16/97 970028-WS Name Change
PSC-99-0483-FOF-WS 03/08/99 981508-WS Transfer Majority Control
PSC-99-2115-PAA-WS 10/25/99 981779-WS Transfer Certificate
PSC-02-1427-FOF-WU 10/18/02 990054-WU Amendment/Deletion
PSC-03-0627-FOF-WU 05/23/03 021142-WU Amendment
PSC-03-1235-FOF-WU 11/03/03 021137-WU Amendment
PSC-04-0715-FOF-WS 07/21/04 040359-WS Name Change
PSC-05-1242-PAA-WS 12/20/05 040951-WS Transfer Certificate
PSC-06-0973-FOF-WS 11/22/06 060643-WS Reorg./Name Change
* 070361-WU Amendment
* 070362-WU Amendment
*Order Number and date to be provided at time of issuance.