Case Background
Bocilla
Utilities, Inc. (Bocilla or Utility) is a Class B utility providing water
service to approximately 400 water customers in Charlotte County. Effective
February 12, 2013, Bocilla was granted water Certificate No. 662-W.[1] Bocilla’s current rates were established
by the Florida Public Service Commission (Commission or PSC) in May of 2017. At that time, the Commission found that Bocilla’s
overall quality of service was unsatisfactory. The Commission ordered a 50
basis point reduction to the Utility’s return on equity (ROE). The reduction would
be effective until the Utility returned to the Commission and demonstrated that
specific improvements in customer service had been made.
On
August 4, 2017, Bocilla filed a letter and documentation demonstrating that it
had made the Commission’s ordered improvements. The Utility requested that the
matter be brought before the Commission to consider restoring the 50 basis
point reduction to its ROE. Staff found several of the attached documents
illegible, and on August 8, 2017, Bocilla filed legible copies of these documents.
On August 24, 2017, Bocilla filed an index application which will increase
rates on November 1, 2017. Therefore, the rate impact of removing the 50 basis
point reduction to ROE would be applied to the indexed rates. The Commission
has jurisdiction pursuant to Section 367.081, Florida Statutes (F.S.).
Discussion
of Issues
Issue 1:
Should the Utility’s quality of service be
considered satisfactory and should its request to remove the 50 basis point
reduction to its ROE be granted?
Recommendation:
Yes. The 50 basis point
reduction to Bocilla’s ROE should be removed and the Utility’s quality of
service should be considered satisfactory at this time. Bocilla’s rates, which would
include the November 1, 2017 index, should be increased by 0.16 percent as
shown on Schedule No. 1. The Utility should file revised tariff sheets and a
proposed customer notice to reflect the Commission-approved rates. The approved
rates should be effective for service rendered on or after the stamped approval
date on the tariff sheet pursuant to Rule 25-30.475(1), Florida Administrative
Code (F.A.C.). In addition, the approved rates should not be implemented until
staff has approved the proposed customer notice and the notice has been
received by the customers. The Utility should provide proof of the date notice
was given within 10 days of the date of the notice. (Hill, Frank, Johnson)
Staff Analysis:
At the May 4, 2017 Agenda
Conference, after considering written and oral comments by customers and the
Office of Public Counsel, the Commission found Bocilla’s quality of service to
be unsatisfactory and imposed a 50 basis point reduction to the Utility’s ROE
based on the customer complaints
regarding water quality and customer service. Order No. PSC-17-0209-PAA-WU,
issued May 30, 2017, states that the 50 basis point reduction shall be effective
until the Utility demonstrates that: (1) the Utility meets the Department of
Environmental Protection’s (DEP) secondary water quality standards as evidenced
by results gathered from the six current testing points specified in that
order; (2) the Utility has posted its office hours on its customers’ bills and
the side of its office building; (3) the Utility has notified its customers
that complaints regarding service may be made to the Commission’s Office of
Consumer Assistance and Outreach at the following toll-free number: 1(800)
342-3552; and (4) the Utility is monitoring its voicemail and is ensuring that
it is meeting the standards for tracking complaints in accordance with Chapter
25-30, F.A.C.
On August 4, 2017, Bocilla filed
a letter requesting removal of the 50 basis point reduction. The Utility’s
filing also included: (1) the results of secondary water quality tests
performed on June 28, 2017, demonstrating that the Utility is passing secondary
standards; (2) a sample customer bill showing its office hours along with a
statement that it posted these hours on the side of its office building; (3) a
copy of the notification it sent to its customers in accordance with the
specifications made in the order; and (4) the customer complaint logs for June
1, 2017, through August 4, 2017, as well as the voicemail message customers
hear when calling the Utility.
In addition to the documentation
provided by the Utility, staff requested photographs showing that the office
hours were clearly posted on the outside of its office building, which Bocilla
provided on August 11, 2017. Staff also confirmed that the office was staffed
and responding to phone calls at two of the published available times, and that
outside of these hours customers would hear the appropriate voicemail message.
It appears that the Utility has
complied with Order No. PSC-17-0209-PAA-WU, and therefore staff recommends that
the 50 basis point reduction to Bocilla’s ROE should be removed. This results
in an increase to Bocilla’s annual revenue requirement of $821 ($497,726 -
$496,905). On August 24, 2017, the Utility filed an index application, which
will increase rates effective November 1, 2017. Therefore, staff recommends a
0.16 percent increase be applied to the indexed rates, as shown on Schedule No.
1. The Utility should file revised tariff sheets and a proposed customer notice
to reflect the Commission-approved rates. The approved rates should be
effective for service rendered on or after the stamped approval date on the
tariff sheet pursuant to Rule 25-30.475(1), F.A.C. In addition, the approved
rates should not be implemented until staff has approved the proposed customer
notice and the notice has been received by the customers. The Utility should
provide proof of the date notice was given within 10 days of the date of the
notice.
Last, staff recommends that a commensurate adjustment
should be made to Bocilla’s quality of service rating. Pursuant to Order No.
PSC-17-0209-PAA-WU, the Commission determined that Bocilla’s quality of service
was unsatisfactory. Based on the corrective actions taken by the Utility, the
quality of service should be considered satisfactory at this time.
Issue 2:
Should this docket be closed?
Recommendation:
Yes. If no person whose substantial interests are
affected by the proposed agency action files a protest within 21 days of the
issuance of the order, a consummating order should be issued and the docket
should be closed administratively. (DuVal)
Staff Analysis:
If no person whose substantial interests are
affected by the proposed agency action files a protest within 21 days of the
issuance of the order, a consummating order should be issued and the docket
should be closed administratively.
