Case Background
On June 12,
2017, Merritt Island Utility Company, Inc. (MIU or Utility) filed an
application with the Florida Public Service Commission (Commission) to amend
Certificate No. 137-S to add territory in Brevard County. When MIU acquired the
wastewater system and Certificate No. 137-S in 2017, the previous owner was serving the
territory requested in the instant docket.
Mobile Home
Investors, Inc. was initially granted a certificate to operate a wastewater
system in existence in 1974. In 1976, the Florida Public Service Commission (Commission) approved
the transfer of the wastewater system and Certificate No. 137-S to Colony Park
Utilities, Inc. In 2003 and 2007, the Utility was granted transfers of majority organizational control,
and in 2014 the wastewater system and Certificate No. 137-S were transferred to
Colony Park Development Utilities, LLC (CPDU). In each of these transactions, the sale included both the Utility and
the Colony Park mobile home park.
CPDU
subsequently sold the mobile home park and the wastewater system to Colony Waste Services, LLC (CWS) in
2016. CPDU and CWS did not file an application for transfer of the system and
wastewater certificate at that time. CWS did not want the wastewater system,
and sold it to MIU, who then filed an application for transfer. During the pendency of Docket No. 20170018-SU, staff and MIU determined
that the wastewater treatment plant was serving customers outside the
certificated territory. This recommendation addresses the Utility’s request to
extend its wastewater service territory. The Commission has jurisdiction
pursuant to Section 367.045, Florida Statutes (F.S.).
Discussion
of Issues
Issue 1:
Should the Commission approve Merritt Island Utility
Company, Inc.’s application for amendment of Certificate No. 137-S to extend
its wastewater territory in Brevard County?
Recommendation:
Yes. It is in the public interest to amend Certificate
No. 137-S to include the territory as described in Attachment A, effective the
date of the Commission’s vote. The resultant order should serve as MIU’s amended
certificate and should be retained by the Utility. The Utility should continue
charging the customers in the territory added herein the rates and charges
contained in its current tariff until a change is authorized by the Commission
in a subsequent proceeding. (M. Watts)
Staff Analysis:
The Utility’s application to amend its authorized
service territory is in compliance with the governing statute, Section 367.045,
F.S., and Rule 25-30.036, Florida Administrative Code (F.A.C.), Application for
Amendment to Certificate of Authorization to Extend or Delete Service Area. The
application contains proof of compliance with the noticing provisions set forth
in Rule 25-30.030, F.A.C., Notice of Application and of Customer Meeting. No
objections to the application have been received and the time for filing such
has expired.
MIU provided adequate service territory maps and territory
descriptions to the Commission. According to the application, the provision of
wastewater services in the proposed service territory is consistent with the
North Merritt Island Small Area Plan Study. As stated in the case background,
when MIU acquired the Utility, the proposed additional service territory,
serving approximately 75 equivalent residential connections, was already being served by the previous owner. Based
on a review of the annual reports filed for the system, it appears that
wastewater service was extended to the additional territory in the 1995 through
1996 time frame by Colony Park
Utilities, Inc., who held Certificate No. 137-S from 1976 to 2014.
The Utility stated in its application that the existing
customers (including those in the proposed extended service area) are served by
a 0.070 million gallon per day treatment plant permitted on an annual average
daily flow basis from the Florida Department of Environmental Protection (DEP).
The system is built out and existing collection lines are sized to serve the
customers currently being served.
The Utility was granted a rate increase in 2008,
and at that time, the Commission found the overall quality of service of the
Utility to be satisfactory and there currently appear to be no outstanding
Consent Orders or Notices of Violation from the DEP. Based upon staff’s review
of the financial information provided in this docket, the Utility’s financial
ability to operate a utility has not diminished since the Utility’s 2008 rate
case. The Utility has filed its 2017 Annual Report and is current with the
payment of its 2017 Regulatory Assessment Fees (RAFs). Based on the foregoing
analysis, staff recommends that MIU has the financial and technical ability to
service the amended territory.
Conclusion
Based on the information above, staff recommends it is in
the public interest to amend Certificate No. 137-S
to include the territory as described in Attachment A, effective the date of
the Commission’s vote. The resultant order should serve as MIU’s amended
certificate and should be retained by the Utility. The Utility should continue
charging the customers in the territory added herein the rates and charges
contained in its current tariffs until a change is authorized by the Commission
in a subsequent proceeding.
Issue 2:
Should Merritt Island Utility Company, Inc. be
required to show cause why it should not be fined for an apparent violation of
Section 367.045(2), F.S., for serving customers outside of its Commission
approved territory?
Recommendation:
No. Staff recommends that the Utility’s apparent
violation of Section 367.045(2), F.S., does not rise to the level which
warrants the initiation of a show cause proceeding. Therefore, MIU should not
be required to show cause for serving customers outside of its Commission
approved territory. (Mapp)
Staff Analysis:
Pursuant to Section
367.045(2), F.S., a utility may not delete or extend its service outside the
area described in its certificate of authorization until it has obtained an
amended certificate of authorization from the Commission. Section 367.161(1), F.S., authorizes
the Commission to assess a penalty of not more than $5,000 for each offense, if
a utility is found to have knowingly refused to comply with, or to have
willfully violated, any provision of Chapter 367, F.S. By serving customers
outside of its certificated territory without obtaining an amended certificate
of authorization, the Utility’s act was “willful” within the meaning of Section
367.161, F.S. Utilities are charged with
the knowledge of the Commission’s statutes and rules. Thus, any intentional
act, such as MIU providing wastewater service beyond the boundaries of
Certificate No. 137-S, without first obtaining a certificate of authorization
from the Commission, would meet the standard for a “willful violation” of
Section 357.161(1), F.S.
In Order No. 24306, issued April
1, 1991, in Docket No. 890216-TL, In Re: Investigation Into The Proper
Application of Rule 25-14.003, Florida Administrative Code, Relating To Tax
Savings Refund For 1988 and 1989 For GTE Florida, Inc., the Commission,
having found that the Company had not intended to violate the rule,
nevertheless found it appropriate to order it to show cause why it should not
be fined, stating that “[i]n our view, ‘willful’ implies an intent to do an
act, and this is distinct from an intent to violate a statute or rule”; see
also Order No. PSC-99-2390-FOF-WU, Issued on December 7, 1999, in Docket
No. 980543-WU, In re: Application for amendment of Certificate No. 363-W to
add territory in Marion County by Sunshine Utilities of Central Florida, Inc.,
(finding that the utility’s apparent violation of Section 367.045, F.S., did
not warrant the initiation of a show cause proceeding). Additionally, “it is a
common maxim, familiar to all minds that ‘ignorance of the law’ will not excuse
any person, either civilly or criminally.” Barlow v. United States, 32
U.S. 404,411 (1833).
Although MIU’s failure to obtain
an amended certificate of authorization from the Commission prior to serving
outside of its certificated area is an apparent violation of Section
367.045(2), F.S., there are mitigating circumstances. When MIU acquired the Utility,
the proposed additional service territory, approximately 75 ERCs, was already
being served by the previous owner. During the evaluation of MIU’s transfer
application, Docket No. 20170018-SU, when it was discovered that the Utility
was serving outside of its certificated territory, MIU immediately filed the
instant application to correct that oversight by requesting the territory be
added to its service area. Additionally, the Utility has paid RAFs on these
customers.
Based on the foregoing, staff recommends that the
Utility’s apparent violation of Section 367.045(2), F.S., does not rise to the
level which warrants the initiation of a show cause proceeding. Therefore,
Merritt Island Utility Company, Inc. should not be required to show cause for
failure to obtain an amended certificate of authorization prior to serving
outside of its certificated territory.
Issue 3:
Should this docket be closed?
Recommendation:
If the Commission approves staff’s recommendations
in Issues 1 and 2, no further action will be necessary, and this docket should
be closed upon issuance of the order. (Mapp)
Staff Analysis:
If the Commission approves staff’s recommendations
in Issues 1 and 2, no further action will be necessary, and this docket should
be closed upon issuance of the order.
Merritt
Island Utility Company, Inc.
Brevard
County
Description
of Wastewater Territory
TERRITORY TO BE ADDED:
Colony Park North - Unit 3
A portion of
the South ½ of the S.E. ¼ of Section 15, Township 23 S, Range 36 E, Brevard
County, Florida, being more particularly described as follows: Commence at the N.E. Corner of the South ½ of
the S.E. ¼ of aforesaid Section 15; thence S 88° 09’ 37” W along the north line
of the South ½ of the S.E. ¼ of said Section 15, a distance of 1,547.55 feet to
the Point of Beginning of the lands herein described; thence continue S 88° 09’
37” W along the north line of the S.E. ¼ of said Section 15, a distance of 1,085.06 feet to the N.W.
corner of the S ½ of the S.E. ¼ of said Section 15; thence S 00° 41’ 31” E
along the west line of the S.E. ¼ of said Section 15, a distance of 239.77
feet; thence N 89° 18’ 29” E a distance of 205.00 feet; thence S 00° 41’ 31” E
a distance of 66.18 feet; thence N 88° 09’ 37” E a distance of 450.09 feet;
thence N 88° 09’ 42” E a distance of 50.01 feet; thence N 88°09’ 37” E a distance of 242.01 feet; thence S 84° 54’ 05”
E a distance of 498.64 feet; thence N 89° 20’ 56” E a distance of 321.53 feet;
thence N 00° 39’ 04” W along the west line of Colony Park North Unit 2 as
recorded in the Plat Book 24, Page 74, Brevard County Public Records, and its
extension, a distance of 105.00 feet; thence S 89° 20’ 56” W along the west
line of said Colony Park North Unit No. 2, a distance of 5.00 feet; thence N.
00˚39’04” W. along the west line of said Colony Park North Unit No. 2, and
it’s extension, a distance of 231.88 feet; thence S 89° 00’ 32” W a distance of
675.01 feet; thence N 00° 39’ 04” W a distance of 30.00 feet to the Point of
Beginning. Containing 12.48 acres more or less.
Mission Acres
The South ½
of the SW ¼ of the SW ¼ of Section 14, Township 23 South, Range 36 East, lying
West of now existing County Road, being more particularly described as follows:
Commence from The Point of Beginning being the Southwest corner of Section 14,
Township 23 South, range 36 East; thence N 89° 54’ 47” E along the South line
of said Section 14 for a distance of 1,163.12 feet to a point on the Westerly
right of way line of McGruder Road; thence N 33°56’ 42” E along said Westerly
right of way for a distance of 286.74 feet to a point on the East line of the
South ½ of the SW ¼ of the SW ¼ of said Section 14; thence go Northerly along
the East line of the South ½ of the SW ¼ of the SW ¼ of said Section 14, N
0°06’25” E for a distance of 91.67 feet to a point being the Northeast corner
of the South ½ of the SW ¼ of the SW ¼ of said Section 14; thence run along the
North line of the South ½ of the SW ¼ of
the SW ¼ , West for a distance of 1,323.41 feet to a point being the Northwest
corner of the South ½ of the SW ¼ of the SW ¼ of said Section 14; thence run
Southerly along the West line of said Section 14, S0˚0’3.05”E for a
distance of 330.00 feet to the Point of Beginning, said parcel contains 9.580
acres more or less; less and except the West 30.00 feet thereof.
COMPOSITE WASTEWATER TERRITORY
In Township 23 South, Range 36
East, Brevard County, Florida
Section
14 & 15
Begin at the Southwest corner of said Section 14, Township
23 South. Range 36 East, which is also the Point of Beginning; thence run North
89° 54' 47" East along the South line of said section 14 for a distance of
1163.12 feet to a point on the Westerly right of way line of a County Road;
thence North 33° 56' 42" East along said Westerly right of way line for a
distance of 286.74 feet to a point on the East line of the South ½ of the SW ¼
of the SW ¼ of said section 14; thence go North 0° 06' 25" East for a
distance of 91.67 feet; thence run North 75° 28' 48" West for a distance
of 25.08 feet; thence North 2° 00' 24" West for a distance of 985.22 feet;
thence South 89° 11' 06" West for a distance of 569.57 feet; thence South
0°·48' 54" East for a distance of 10 feet; thence South 87° 05' 16"
West a distance of 710.58 feet; thence South 0°·39' 04" East, 30.99 feet;
thence North 89° 35' 04" West, 477.03 feet; thence South 0°·38' 31"
West, 25 feet; thence South 68° 21' 32" West, 84.30 feet; thence South 76°
38' 12" West, 83.63 feet; thence South 89° 20' 56" West, 234.00 feet;
thence North 0° 56' 37" West, 81.56 feet; thence South 89° 00' 32"
West, 675.01 feet; thence North 00° 39' 04" West, 30.00 feet; thence South
88° 09 '37" West, 1,085.06 feet; thence South 0° 41' 31" East, 239.77
feet; thence North 89° 18' 29" East, 205.00 feet; thence South 0° 41'
31" East, 66.18 feet; thence North 88° 09' 37" East, 742.10 feet;
thence South 84° 34' 05'' East, 498.64 feet; thence North 89° 20' 56"
East, 319.55 feet; thence South 00° 39' 04'' West, 384.45 feet; thence South
87° 45' 45" West, 358.30 feet; thence South 02° 14' 15'' East, 150.00 feet
to a point on the South boundary of St. Charles Avenue; thence Westerly 30 feet
more or less; thence South 02° 14' 15" East, 400.00 feet; thence North 88°
7' 24'' East, 1,251.l5 feet, more or less to the Point of Beginning.
FLORIDA PUBLIC SERVICE COMMISSION
Authorizes
Merritt Island Utility Company, Inc.
Pursuant to
Certificate Number 137-S
to provide wastewater service in Brevard
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, cancelled or revoked by Order of
this Commission.
Order Number Date
Issued Docket Number Filing Type
6365 12/02/1974 73391-S Original
Certificate
7296 06/28/1976 750664-S Transfer
PSC-03-0320-FOF-SU 03/06/2003 020930-SU Transfer
of Majority
Organizational Control
PSC-07-0420-FOF-SU 05/14/2007 060636-SU Transfer
of Majority
Organizational Control
PSC-14-0673-PAA-SU 12/05/2014 120285-SU Transfer
PSC-2017-0366-PAA-SU 09/27/2017 20170018-SU Transfer
·
- * 20170142-SU Amendment
