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State of Florida
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Public Service Commission
Capital Circle Office Center ● 2540 Shumard
Oak Boulevard
Tallahassee, Florida 32399-0850
-M-E-M-O-R-A-N-D-U-M-
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DATE:
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June 28, 2023
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TO:
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Office of Commission Clerk (Teitzman)
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FROM:
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Division of Engineering (M. Watts, Ramos)
Division of Accounting
and Finance (Sewards, Thurmond)
Division of Economics
(Bethea, Hudson)
Office of the General
Counsel (Watrous, J. Crawford)
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RE:
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Docket No. 20220149-WS Application for
transfer of wastewater Certificate No. 365-S of Sebring Ridge Utilities, Inc.
to CSWR-Florida Utility Operating Company, LLC, in Highlands County.
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AGENDA:
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07/11/23 Regular Agenda Proposed Agency Action for Issues 2, 3,
and 4 -Interested Persons May Participate
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COMMISSIONERS ASSIGNED:
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All Commissioners
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PREHEARING OFFICER:
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Graham
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CRITICAL DATES:
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None
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SPECIAL INSTRUCTIONS:
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None
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Case Background
Sebring Ridge
Utilities, Inc. (Sebring, Utility, or Seller) is a Class C wastewater utility
operating in Highlands County. Sebring provides wastewater service to
approximately 279 residential and 252 general service customers. The City of
Avon Park Utilities provides water service to the area. The Utility is in the
Southwest Florida Water Management District (SWFWMD) and is in the Southern Water
Use Caution Area. In its 2022 Annual Report, Sebring reported a net operating
income of $24,932. The Utilitys last staff-assisted rate case was in 1996.[1]
In 1984, the
Florida Public Service Commission (Commission) issued grandfather water and
wastewater Certificate Nos. 434-W and 365-S to Sebring.[2] Since its certification, the Utility has
experienced three territory amendments, one of which was the transfer to a
governmental authority of its water facilities and the cancellation of its
water certificate.[3]
On August 31,
2022, CSWR-Florida Utility Operating
Company, LLC (CSWR-Sebring or Buyer) filed an application with the
Commission for the transfer of Certificate No. 365-S from Sebring to CSWR-Sebring
in Highlands County. The application was found to be deficient. The Buyer cured
the deficiencies on January 25, 2023. The sale will close after the Commission votes
to approve the transfer. In its application, the Buyer has requested a positive
acquisition adjustment, which is discussed in Issue 3. The Office of Public
Counsels (OPC) intervention was acknowledged by Order No.
PSC-2023-0138-PCO-SU, issued April 21, 2023.
This
recommendation addresses the transfer of the wastewater system and Certificate No.
365-S, the appropriate net book value of the wastewater system for transfer
purposes, and the request for an acquisition adjustment. The Commission has
jurisdiction pursuant to Sections 367.071 and 367.081, Florida Statutes (F.S.).
Discussion
of Issues
Issue 1:
Should the transfer of Certificate No. 365-S in
Highlands County from Sebring Ridge Utilities, Inc. to CSWR-Florida Utility
Operating Company, LLC be approved?
Recommendation:
Yes. The transfer of the wastewater system and
Certificate No. 365-S is in the public interest and should be approved
effective the date that the sale becomes final. The resultant Order should
serve as the Buyers certificate and should be retained by the Buyer. The Buyer
should submit the executed and recorded deed for continued access to the land
upon which its facilities are located, copies of its permit transfer
application, and a copy of its signed and executed contract for sale to the
Commission within 60 days of the Order approving the transfer, which is final
agency action. If the sale is not finalized within 60 days of the transfer
Order, the Buyer should file a status update in the docket file. The Utilitys
existing rates, service availability charges, and initial customer deposits, as
shown on Schedule No. 4, should remain in effect until a change is authorized
by the Commission in a subsequent proceeding. The tariff pages reflecting the
transfer should be effective on or after the stamped approval date on the
tariff sheets, pursuant to Rule 25-30.475(1), Florida Administrative Code
(F.A.C.). The Seller is current with respect to annual reports and regulatory
assessment fees (RAFs) through December 31, 2022. The Buyer should be
responsible for filing annual reports and paying RAFs for all future years. (M.
Watts, Thurmond, Bethea)
Staff Analysis:
On August 31, 2021, CSWR-Sebring filed an
application for the transfer of Certificate No. 365-S from Sebring to CSWR-Sebring
in Highlands County. The application is in compliance with Section 367.071,
F.S., and Commission rules concerning applications for transfer of
certificates. The sale to CSWR-Sebring will become final after Commission
approval of the transfer, pursuant to Section 367.071(1), F.S.
Noticing, Territory, and Land
Ownership
CSWR-Sebring provided notice of the application pursuant
to Section 367.071, F.S., and Rule 25-30.030, F.A.C. No objections to the
transfer were filed, and the time for doing so has expired. The application
contains a description of the service territory, which is appended to this
recommendation as Attachment A. In its application, CSWR-Sebring provided a copy of an unrecorded warranty
deed as evidence that the Buyer will have rights to long-term use of the land
upon which the treatment facilities are located pursuant to Rule
25-30.037(2)(s), F.A.C. CSWR-Sebring committed to providing the executed and recorded deed to the Commission
within 60 days after the closing of the sale.
Purchase Agreement and Financing
Pursuant to Rule 25-30.037(2)(g), (h), and (i), F.A.C.,
the application contains a statement regarding financing and a copy of the
purchase agreement, which includes the purchase price, terms of payment, and a
list of the assets purchased. There are no guaranteed revenue contracts or
customer advances from Sebring that must be disposed of with regard to the
transfer. CSWR-Sebring will review all leases and developer agreements and will
assume or renegotiate those agreements on a case-by-case basis prior to
closing. Any customer deposits will be refunded to customers by the Seller
prior to the closing. According to the purchase and sale agreement, the total
purchase price for the assets is $540,000. According to the Buyer, the closing
has not yet taken place and is dependent on Commission approval of the
transfer, pursuant to Section 367.071(1), F.S.
Facility Description and Compliance
Sebrings domestic wastewater treatment plant (WWTP) is a
65,000 gallons per day (gpd) extended aeration plant, consisting of a 16,270 gallon
flow equalization basin, 74,490 gallons of aeration, dual clarifiers with a
combined capacity of 19,160 gallons, a 3,000 gallon chlorine contact basin, and
three 5,000 gallon sludge digester basins. Disinfection is provided by liquid
sodium hypochlorite in a 9,200 gallon chlorine contact chamber. The treated
water is discharged into a reuse system consisting of two rapid infiltration
basins with a total capacity of 65,000 gpd, the permitted capacity of the WWTP.
CSWR-Sebring provided a copy of the Utilitys current permit from the Florida
Department of Environmental Protection (DEP) pursuant to Rule 25-30.037(2)(r)1.,
F.A.C. The Buyer committed to providing a copy of its permit transfer
application, reflecting the change in ownership, to the Commission within 60
days of the contract for sale.
Staff reviewed the most recent DEP compliance evaluation
inspections (CEI) for the WWTP. The DEPs December 8, 2020 CEI identified a number of issues that resulted in a
file review followed by a warning letter. The warning letter listed twelve
items found during the inspection, with the details described in an attached
copy of the CEI. Most of the items deal with untimely and/or inaccurate
reporting, as well as inadequate recordkeeping. The issues cited for improper
plant maintenance were: the pH calibration meter was not bracketed; a clogged
diffuser; excessive vegetation in the pond; and accumulated sludge in the pond.
Staff also notes that the DEP issued the Sellers current
wastewater permit, effective October 30, 2020, with an Administrative Order and
accompanying compliance schedule that detailed actions that Sebring must take
in order to reach full compliance with the new requirements. According to the
latest information available on the DEPs Oculus site, most of the items on the
Compliance Schedule had been completed as of May 17, 2021, with some items
pertaining to percolation pond maintenance anticipated to be completed within
30 days. In Exhibit H of the Buyers application, CSWR-Sebring provides its
assessment of Sebrings wastewater treatment plant and lists several
improvements and repairs it recommends be made to the system. The Buyers
suggested repairs and improvements are discussed further in Issue 3.
Technical and Financial Ability
Pursuant to Rule 25-30.037(2)(l) and (m), F.A.C., the
application contains statements describing the technical and financial ability
of the Buyer to provide service to the proposed service area. As referenced in
the transfer application, the Buyer will fulfill the commitments, obligations,
and representations of the Seller with regards to utility matters.
CSWR-Sebrings application states that it owns and operates water and wastewater
systems in Missouri, Arkansas, Kentucky, Louisiana, Texas, Mississippi,
Arizona, North Carolina, and Tennessee that currently serve more than 73,000
water and 117,000 wastewater customers. The Commission has also approved CSWRs
purchase of four Florida certificated utilities in prior dockets.
The Buyer plans to use qualified and licensed contractors
to provide routine operation and maintenance (O&M) of the systems, as well
as to handle billing and customer service. Staff reviewed the financial
statements of CSWR-Sebring and believes the Buyer has documented adequate
resources to support the Utilitys wastewater operations. Based on the above,
the Buyer has demonstrated the technical and financial ability to provide
service to the existing service territory.
Rates and Charges
The Utilitys rates, charges, and initial
customer deposits were last approved in a 1996 staff-assisted rate case.[5] Sebring had a rate
decrease to remove expired rate case expense amortization in 2000. Subsequently,
the rates have been amended by 11 price index and 2 pass through rate
adjustments with the last one being in 2020. Rule 25-9.044(1), F.A.C., provides
that, in the case of a change of ownership or control of a Utility, the rates,
classifications, and regulations of the former owner must continue unless
authorized to change by the Commission. However, the miscellaneous service
charges do not conform to Rule 25-30.460, F.A.C., and are discussed in Issue 4.
Therefore, staff recommends that the Utilitys existing rates, service
availability charges, and initial customer deposits as shown on Schedule No. 4,
should remain in effect, until a change is authorized by the Commission in a
subsequent proceeding. The tariff pages reflecting the transfer should be
effective on or after the stamped approval date on the tariff sheets pursuant
to Rule 25-30.475, F.A.C.
Regulatory Assessment Fees and Annual Report
Staff has verified that the Utility is current on the
filing of annual reports and RAFs through December 31, 2022. The Buyer will be
responsible for filing the Utilitys annual reports and paying RAFs for all
future years.
Conclusion
Based on the foregoing, staff recommends that the transfer
of the wastewater system and Certificate No. 365-S is in the public interest
and should be approved effective the date that the sale becomes final. The
resultant Order should serve as the Buyers certificate and should be retained
by the Buyer. The Buyer should submit the executed and recorded deed for
continued access to the land upon which its facilities are located, copies of
its permit transfer application, and a copy of its signed and executed contract
for sale to the Commission within 60 days of the Order approving the transfer,
which is final agency action. If the sale is not finalized within 60 days of
the transfer Order, the Buyer should file a status update in the docket file.
The Utilitys existing rates, service availability charges, and initial
customer deposits, as shown on Schedule No. 4, should remain in effect until a
change is authorized by the Commission in a subsequent proceeding. The tariff
pages reflecting the transfer should be effective on or after the stamped
approval date on the tariff sheets, pursuant to Rule 25-30.475(1), F.A.C. The
Seller is current with respect to annual reports and RAFs through December 31,
2022. The Buyer should be responsible for filing annual reports and paying RAFs
for all future years.
Issue 2:
What is the appropriate net book value for CSWR-Florida
Utility Operating Company LLCs wastewater system for transfer purposes?
Recommendation:
For transfer purposes, the net book value (NBV) of
the wastewater system is $8,222 as of August 31, 2022. Within 90 days of the
date of the consummating Order, CSWR-Sebring should be required to notify the
Commission in writing that it has adjusted its books in accordance with the
Commissions decision. The adjustments should be reflected in CSWR-Sebrings
2023 Annual Report when it is filed. (Thurmond)
Staff Analysis:
The rate base was last established as of December
31, 1994, by Order No. PSC-1996-0869-FOF-WS.
The purpose of establishing NBV for transfers is to determine whether an
acquisition adjustment should be approved. CSWR-Sebrings request for a
positive acquisition adjustment is addressed in Issue 3. The NBV does not
include normal ratemaking adjustments for used and useful plant or working
capital. The Utilitys NBV has been updated to reflect balances as of August
31, 2022.
Staffs recommended NBV, as described below, is shown on Schedule No. 1.
Utility Plant in Service (UPIS)
According to the Utilitys general ledger, the total UPIS
balance was $565,944 as of December 31, 2021. Staff determined that the Utility
had not made the adjustments required by Order No. PSC-1996-0869-FOF-WS. As a
result, staff recommends a decrease to UPIS of $130,192 as of August 31, 2022.
Accordingly, staff recommends a total UPIS balance of $435,752 as of August 31,
2022.
Land
The Utilitys general ledger reflected a land
balance of $19,712 as of December 31, 2021. There have been no additions to
land since December 31, 1994; however, staff determined that the Utility had
not made the adjustments required by Order No. PSC-1996-0869-FOF-WS. Therefore,
staff recommends an increase in the value of land of $26,004 as of August 31,
2022. Accordingly, staff recommends a total land balance of $45,716 as of
August 31, 2022.
Accumulated Depreciation
According to the Utilitys general ledger, the
total accumulated depreciation balance was $489,155 as of December 31, 2021.
Staff auditors recalculated depreciation accruals using the depreciation rates
established by Rule 25-30.140, F.A.C. As a result, staff recommends that the
accumulated depreciation balance be decreased by $80,995 as of August 31, 2022.
Accordingly, staff recommends a total accumulated depreciation balance of $408,160
as of August 31, 2022.
Contributions-in-Aid-of-Construction
(CIAC) and Accumulated Amortization of CIAC
According to the Utilitys general ledger, the CIAC
balance and accumulated amortization of CIAC were $578,043 and $530,761,
respectively, as of December 31, 2021. Staff determined that the Utility had
not made the adjustments required by Order No. PSC-1996-0869-FOF-WS. As a
result, staff recommends that the CIAC balance be decreased by $298,468 as of August
31, 2022. Staff also recommends that the accumulated amortization of the CIAC
balance be decreased by $316,272 as of August 31, 2022. Accordingly, staff
recommends total CIAC and Accumulated Amortization of CIAC balances of $279,575
and $214,489, respectively, as of August 31, 2022.
Net Book Value
The Utilitys general ledger reflected a NBV of
$49,219 as of December 31, 2021. Based on the adjustments described above,
staff recommends a NBV of $8,222 as of August 31, 2022. Staffs recommended NBV
and the National Association of Regulatory Utility Commissioners, Uniform
System of Accounts (NARUC USOA) balances for UPIS and accumulated depreciation
are shown on Schedule No. 1 as of August 31, 2022. As addressed in Issue 3,
staff recommends a positive acquisition adjustment not be recognized for
ratemaking purposes.
Conclusion
Based on the above, staff recommends a NBV of $8,222 as of
August 31, 2022, for transfer purposes. Within 90 days of the date of the
consummating Order, the Buyer should be required to notify the Commission in
writing that it has adjusted its books in accordance with the Commissions
decision. The adjustments should be reflected in the Utilitys 2023 Annual
Report when it is filed.
Issue 3:
Should a positive acquisition adjustment be
recognized for ratemaking purposes?
Recommendation:
No. Pursuant to Rule 25-30.0371, F.A.C., a positive
acquisition adjustment should not be granted as the Buyer failed to demonstrate
extraordinary circumstances. (Thurmond, M. Watts)
Staff Analysis:
In its filing, the Buyer requested a positive
acquisition adjustment be included in the calculation of CSWR-Sebrings rate
base. An acquisition adjustment results when the purchase price differs from
the NBV of the assets at the time of acquisition. Pursuant to Rule 25-30.0371,
F.A.C., a positive acquisition adjustment results when the purchase price is
greater than the NBV, and a negative acquisition adjustment results when the
purchase price is less than the NBV. A positive acquisition adjustment, if
approved, increases the rate base.
According to the purchase agreement, the Buyer will
purchase the Utility for $540,000. As discussed in Issue 2, staff is
recommending a NBV of $8,222. This would result in a positive acquisition
adjustment of $531,778.
Any entity that believes a full or partial positive
acquisition adjustment should be made has the burden of proving the existence
of extraordinary circumstances. Rule 25-30.0371(2), F.A.C., states:
In determining whether extraordinary circumstances
have been demonstrated, the Commission shall consider evidence provided to the
Commission such as anticipated improvements in quality of service, anticipated
improvements in compliance with regulatory mandates, anticipated rate
reductions or rate stability over a long-term period, anticipated cost
efficiencies, and whether the purchase was made as part of an arms-length
transaction.
If a purchase price above the depreciated original cost is
used to determine the rate base without the requirement for extraordinary
circumstances, it could encourage utilities to "swap assets" and inappropriately
increase costs to customers.
Deferral
In discovery, CSWR-Sebring stated that it intends to ask
for deferral of a decision regarding the requested acquisition adjustment. In
its application, the Buyer laid out factors such as improvements to quality of
service, cost efficiencies, and rate stability. These are discussed below, and staff
recommends that these factors do not constitute extraordinary circumstances. In
response to discovery, the Buyer agreed that after the rate base is set, if a company
provides support in a separate and subsequent case that there are utility assets
that were not previously recorded, then the company can prospectively recover
the unrecorded amount of that investment. Therefore, if the Buyer finds assets
were incorrectly recorded on the Sellers balance sheet, the Buyer can support
those costs and recover them in a future rate case. That is normal Commission
practice and is not considered extraordinary circumstances.
Pursuant to Commission practice, the Buyer has the burden of
proving extraordinary circumstances at the time of transfer. Staff believes that
in the instant case, the Buyer has failed to provide proof of extraordinary
circumstances. Further, the Buyer had multiple opportunities to provide
pertinent information needed to determine if a positive acquisition adjustment
was appropriate. As such, staff recommends the Commission deny the request to
defer a decision on the positive acquisition adjustment.
Finally, it is long-standing Commission practice to address
the disposition of any positive or negative acquisition adjustment at the time
of transfer. Pursuant to Section 120.68(7)(e)3., F.S., when agencies change
their established policies, practices, and procedures, they must give an
explanation for the deviation. Staff does not believe the facts in this case
warrant such a deviation. As such, staff believes the deferral of a positive
acquisition adjustment decision in this docket would result in an unnecessary
deviation from Commission practice.
Improvements in Quality
of Service and Compliance with Regulatory Mandates
In its application, CSWR-Sebring listed six business
practices that it believes will improve the quality of service to its
customers: (1) provision of 24-hour emergency service phone numbers; (2)
on-call emergency service personnel who are required to respond to emergency
service calls within prescribed time limits; (3) a computerized maintenance
management system; (4) access to resources not usually available to comparably
sized systems and the ability to supplement local personnel with resources
owned by the parent and sister companies; (5) online bill payment options; and
(6) an updated website for customer communication, bulletins, procedures, etc.
Staff reviewed the complaints
filed with the Commission for the five-year period prior to the application, from
August 2017 to August 2022. The Commission recorded one complaint regarding
improper billing during this time period. In its application, CSWR-Sebring did
not list any customer complaints related to the wastewater treatment system.
In
addition to reviewing the Utilitys most recent inspection report, as discussed
in Issue 1, staff also reviewed the DEP inspection reports and enforcement
actions for the two years prior to the 2020 CEI (CEIs conducted in 2018 and
2019). The Utility appears to have ongoing issues with proper documentation,
recordkeeping, and reporting. For example, each of the last three CEIs noted
that the Operation and Maintenance manual for the plant and collection system
was not onsite, and two listed errors in the monthly discharge monitoring
report. Additionally, each of the last three CEIs listed several other
instances of inadequately maintained documentation. However, the 2018 and 2019
CEIs listed significantly more plant maintenance issues, which Sebring
corrected, than were noted in the 2020 CEI. The one plant maintenance issue
that appears to be an ongoing problem is percolation pond maintenance.
In
Exhibit H of its application, which was filed with a request for
confidentiality, CSWR-Sebring described its plans for repairs and improvements.
The Buyers plans for repair largely address the issues described above from
the DEP reports, as well as repairs to the lift stations. Its plans for
improvements to the system consist primarily of the addition of remote
monitoring systems. CSWR-Sebring stated in its application that no
governmental authorities are presently requiring repairs or improvements to the
systems.
Based on the
above, it appears that Sebring currently has issues with respect to regulatory
compliance. While the Buyer identified several improvements it intends to
implement in an effort to rectify these points, staff does not believe the
Buyer has demonstrated extraordinary circumstances in support of its requested
positive acquisition adjustment. Instead, staff believes that the proposed
anticipated improvements in quality of service and compliance with regulatory
mandates demonstrate CSWR-Sebrings intention to responsibly execute its
obligations as a utility owner. While staff does not believe
the Utilitys anticipated improvements justify its requested positive
acquisition adjustment, these improvements may be considered for prudence and
cost recovery in a future rate proceeding.
Anticipated Cost
Efficiencies and Rates
In its application, the Buyer stated that its size and
anticipated consolidation of many small systems under one financial and
managerial entity would result in operational cost efficiencies, particularly
in the areas of:
·
PSC and environmental regulatory reporting
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Managerial and operational oversight
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Utility asset planning
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Engineering planning
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Ongoing utility maintenance
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Utility record keeping
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Customer service responsiveness
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Improved access to capital is necessary to
repair and upgrade Sebrings systems to ensure compliance with all health and
environmental requirements and ensure service to customers remains safe and
reliable
In response to the staffs data request, the Utility
estimated an increase in O&M expense of approximately $52,000 in order to
cure compliance issues already present and ensure the system can avoid them in
the future. While staff is aware of the importance of maintaining compliance,
this increase on top of the requested acquisition adjustment of $531,778, approximately
sixty-five times greater than the systems current NBV of $8,222, would result
in a substantial increase in revenue requirement.
The Buyer also stated that CSWR-Sebring would bring
long-term rate stability to the Utility, should the transfer be approved. Staff
agrees that economies of scale and the potential consolidation of several
systems in Florida, as proposed by CSWR-Sebring, could bring some long-term
rate stability. However, absent specific and detailed support for these
assertions, the Buyer has failed to meet its burden of demonstrating
extraordinary circumstances.
Staffs recommendation is consistent with the Commissions
decision in Order No. PSC-2020-0458-PAA-WS.[8]
In that docket, the Buyer identified estimates of anticipated cost efficiencies,
including a reduction in O&M expenses and a reduction in the cost of
capital that would result from the transfer. Additionally, the Buyer cited
several improvements it has made to the wastewater treatment plant and
wastewater lift station since acquisition to improve the quality of service and
compliance with regulatory mandates. While the Commission acknowledged that the
Buyer accomplished cost savings, it did not believe the actions performed
demonstrated extraordinary circumstances that would justify approval of a
positive acquisition adjustment.
Staffs recommendation is also consistent with the
Commissions decisions to deny CSWR-Sebring a positive acquisition adjustment
in Order Nos. PSC-2022-0116-PAA-SU, PSC-2022-0120-PAA-WU, PSC-2022-0115-PAA-WS,
and PSC-2022-0364-PAA-WU.[9] In those
cases, the Commission determined that the Buyer failed to provide sufficient
evidence of extraordinary circumstances, and CSWR was denied a positive
acquisition adjustment in all four cases. In those cases, CSWR also requested a
deferral of the decision regarding the positive acquisition adjustments, which
was also denied by the Commission. Staff believes the facts of this case are similar
to the four cases discussed above.
Conclusion
Pursuant to Rule 25-30.0371, F.A.C., staff recommends a
positive acquisition adjustment not be granted as the Buyer did not demonstrate
extraordinary circumstances. Staff believes the Buyers anticipated improvements
in quality of service and compliance with regulatory mandates do not illustrate
extraordinary circumstances and instead demonstrate CSWR-Sebrings intentions
to responsibly provide utility service.
Issue 4:
Should CSWR-Florida Utility Operating Company, LLCs
miscellaneous service charges be revised to conform to amended Rule 25-30.460,
F.A.C.?
Recommendation:
Yes. The miscellaneous service charges should be
revised to conform to the recent amendment to Rule 25-30.460, F.A.C. The tariff
should be revised to reflect the removal of initial connection and normal reconnection
charges. The Utility should be required to file a proposed customer notice to
reflect the Commission-approved charges. The approved charges should be
effective for service rendered or connections made on or after the stamped
approval date on the tariff sheets, provided customers have received notice
pursuant to Rule 25-30.475(2), F.A.C. In addition, the approved charge should
not be implemented until staff has approved the proposed customer notice and
the notice has been received by customers. The Utility should provide proof of
the date the notice was given within 10 days of the date of the notice. The
Utility should be required to charge the approved miscellaneous service charges
until authorized to change them by the Commission in a subsequent proceeding. (Bethea)
Staff Analysis:
Effective
June 24, 2021, Rule 25-30.460, F.A.C., was amended to remove initial connection
and normal reconnection charges.[10] The
definitions for initial connection charges and normal reconnection charges were
subsumed in the definition of the premises visit charge. The Utilitys
miscellaneous service charges consist of initial connection and normal
reconnection charges. The normal reconnection charge is more than the premises
visit charge. Since the premises visit entails a broader range of tasks, staff
believes the premises visit charge should reflect the amount of the normal
reconnection charge of $15. Therefore, staff recommends that the initial
connection and normal reconnection charges be removed, the premises visit
charge should be revised to $15, and the definition for the premises visit
charge be updated to comply with amended Rule 25-30.460, F.A.C. The Utilitys
existing and staffs recommended miscellaneous service charges are shown below
in Table 4-1.
Table
4-1
Utility Existing and Staff Recommended Miscellaneous Service
Charges
|
|
Existing
|
Staff
Recommended
|
|
|
Normal
Hours
|
Normal
Hours
|
|
Initial Connection Charge
|
$15.00
|
N/A
|
|
Normal Reconnection Charge
|
$15.00
|
N/A
|
|
Violation Reconnection Charge
|
Actual
Cost
|
Actual
Cost
|
|
Premises Visit Charge
|
$10.00
|
$15.00
|
Conclusion
Based on the above, staff recommends the miscellaneous
service charges be revised to conform to the recent amendment to Rule
25-30.460, F.A.C. The tariff should be revised to reflect the removal of
initial connection and normal reconnection charges. The Utility should be
required to file a proposed customer notice to reflect the Commission-approved
charges. The approved charges should be effective for service rendered or
connections made on or after the stamped approval date on the tariff sheets,
provided customers have received notice pursuant to Rule 25-30.475(2), F.A.C.
In addition, the approved charges should not be implemented until staff has
approved the proposed customer notice and the notice has been received by
customers. The Utility should provide proof of the date the notice was given
within 10 days of the date of the notice. The Utility should be
required to charge the approved miscellaneous service charges until authorized
to change them by the Commission in a subsequent proceeding.
Issue 5:
Should this docket be closed?
Recommendation:
Yes. If no protest to the proposed agency action is
filed by a substantially affected person within 21 days of the date of the
issuance of the Order, a Consummating Order should be issued and the docket
should be closed administratively upon Commission staffs verification
that the revised tariff sheets have been
filed, the Buyer has notified the Commission in writing that it has adjusted
its books in accordance with the Commissions decision, that the Buyer has submitted
the executed and recorded warranty deed, that the Buyer has submitted a copy of
its application for permit transfer to the DEP, and that the Buyer has
submitted a signed and executed copy of its contract for sale within 60 days of
the Commissions Order approving the transfer. (Watrous)
Staff Analysis:
If no protest to the proposed agency action is filed
by a substantially affected person within 21 days of the date of the issuance
of the Order, a Consummating Order should be issued and the docket should be
closed administratively upon Commission staffs verification that the revised
tariff sheets have been filed, the Buyer has notified the Commission in writing
that it has adjusted its books in accordance with the Commissions decision,
that the Buyer has submitted the executed and recorded warranty deed, that the
Buyer has submitted a copy of its application for permit transfer to the DEP,
and that the Buyer has submitted a signed and executed copy of its contract for
sale within 60 days of the Commissions Order approving the transfer.
ORDER NO. 13564
TOWNSHIP 34 South, RANGE
28 East
SECTIONS 2. 11, and 12
Commence at the
Northeast corner of said Section 11, thence
North 01°04'20" West following the Easterly boundary of said Section 2, a
distance of 242.10 feet to a point;
thence North 89°47'20" West a distance of 2,257.35 feet to the centerline of Florida Power
Company easement and the POINT
OF BEGINNING. Thence continue North 89°47'20"
West a distance of 1,641.85 feet to a point on the Easterly ROW line of S-17A, thence South 01°29'30" East along
said ROW line
a distance of 498 feet to a point; thence South 34°50'15"
East along the Easterly ROW line of Manatee Drive for a distance of 3,271 feet to a point; thence North 55°09'45" East for
a distance of 250 feet
to a point; thence North
3°50'15" West with the Southerly
boundary of Whiting Drive a distance of 47.74
feet to a point; thence
North 55°09'45" East across Whiting Drive a distance of 175 feet to a point; thence South
34°50'15" East for a
distance of 57.76 feet to a point
of curvature to the left, said curve having
for its
elements a radius of 462 feet
and a central angle
of 54°30'25", thence
Easterly along the arc of said
curve a distance of 439.42 feet to a point of tangency; thence South
89°20'40" East for a distance of 378.55 feet to a
point of curvature to the right,
said curve having
for its elements a radius of 3,342.84 feet and a central angle of 15°34'80", thence Easterly along the arc of said curve for a distance of 908.70
feet to a point of tangency; thence South 73°46'10"
East for a distance of 617
feet to a point; thence
South 18°16'30"
West for a distance of 425.27 feet to the Northerly ROW line
of Lake Sebring Drive; thence South 73°46'10" East along
said ROW line
for a distance of 125.08 feet
to a point; thence North
18°16'30" East, a distance
of 1,462.58 feet to the Westerly
ROW line of the Atlantic Coast Line Railroad; thence North
and West along
said ROW line
on an arc of a curve,·
concave on its Easterly side and having
for its elements a radius of 5,761.78 feet and
a central angle of 09°19'47"
for a distance of 938.22 feet to a point; thence
North 89°47'20"
West a distance of 582.20
feet to the centerline of Florida Power Easement, thence North 61°07'50"
West following aforesaid centerline a distance
of 2,502.16 feet to the POINT OF BEGINNING.
ORDER NO. 19116
A portion of Sections 10 and 11, Township
34 South, Range 28 East, Highlands County Florida, being
more particularly described as follows:
Begin at the Northeast corner of Section
10; thence run South 88°41'30" West and along the North line
of Section 10 a distance
of 2,095.12 feet
to a point on the East line
of Block "C" of Maxcy Parkway Subdivision, as per plat
recorded in Plat
Book 4, page
72 of the Public Records
of Highlands County,
Florida; thence North·19°34'10" West and along said East line a distance of 677.55 feet to the Northeast corner
of Lot 36 of said subdivision; thence
South 70°25'50" West and along the North
line of Lot 36 a distance of 200.00 feet to a point
on the Easterly ROW line of
U.S. Highway No. 27; thence
South 19°34'10" East and along
said ROW line
a distance of 1,200.00 feet to the Southwest corner of Lot 25 of Maxcy Parkway Subdivision;
thence North 10°25'50" East and along the South line of Lot 25 a distance
of 200.00 feet to the Southeast corner of Lot 25; thence
South 19°34'10" East and along
the E line of Block C of said subdivision a distance of 46.16 feet to a point on the North boundary of Section
B of Sebring Ridge Subdivision, as per plat recorded in Plat Book
7, page 46 of the Public Records
of Highlands County, Florida; thence South 79°40'10" East
and along the North line of said
subdivision a distance
of 942.10 feet
to the Point of Curvature
of a curve concave to the Southwest; thence in a Southeasterly direction
and along the arc of said curve to the right (curve
having for its elements a Radius of 2,950.00 feet
and a Central Angle of 2°28'02") a distance
of 127.03 feet; thence North 12°47'52" East and radial to the last described
curve a distance
of 225.00 feet
to a point on the arc of a curve concave
to the Southwest; thence in a Southeasterly direction and along the arc of said curve to the right (curve having
for its elements
a Radius of 3,175.00 feet, a Central Angle of 17°43'13" and a Chord
Bearing of South 68°20'32" East) a
distance of 981.95 feet to a point on the Northwest ROW line of Herring Avenue;
thence North 30°58'09" East and along
said ROW line
a distance of 588.10 feet;
thence North 88°36'30" East and along the North ROW line
of Herring Avenue a distance of 907.2 feet; thence North 1°29'30" West
a distance
of 425.10 feet to
a point on the North line of Section 11; thence South 88°36'30" West and along said line
a distance of 1,304.87 feet to the Point of Beginning. Subject to all easements, reservations or restrictions
of record.
Containing
51.242 Acres.
FLORIDA PUBLIC SERVICE COMMISSION
authorizes
CSWR-Florida
Utility Operating Company, LLC
pursuant to
Certificate Number 365-S
to provide wastewater service in Highlands
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
Order No. 13564 08/03/84 19830049-WS Grandfather
Order No. 19116 04/06/88 19880255-WS Territory Amendment
* * 20220149-SU Transfer
*Order Number and
date to be provided at time of issuance
CSWR-Florida Utility Operating
Company, LLC
Sebring Ridge Utilities, Inc.
Schedule of Net Book Value as of August
31, 2022
|
Description
|
Balance
Per Utility
12/31/21
|
Adjustments
|
|
Staff
8/31/22
|
|
|
|
|
|
|
|
Utility Plant in Service
|
$565,944
|
($130,192)
|
A
|
$435,752
|
|
Land & Land Rights
|
19,712
|
26,004
|
B
|
45,716
|
|
Accumulated Depreciation
|
(489,155)
|
80,995
|
C
|
(408,160)
|
|
CIAC
|
(578,043)
|
298,468
|
D
|
(279,575)
|
|
Amortization of CIAC
|
530,761
|
(316,272)
|
E
|
214,489
|
|
|
|
|
|
|
|
Total
|
$49,219
|
($40,997)
|
|
$8,222
|
|
|
|
|
|
|
CSWR-Florida Utility Operating
Company, LLC
Sebring Ridge Utilities, Inc.
Explanation of Adjustments to Net Book
Value as of August 31, 2022
|
Explanation
|
Amount
|
|
|
|
|
A.
UPIS
|
|
|
To reflect the appropriate
balance.
|
($130,192)
|
|
|
|
|
|
|
|
B.
Land
To reflect the appropriate
balance.
|
26,004
|
|
|
|
|
C.
Accumulated Depreciation
|
|
|
To
reflect the appropriate balance.
|
80,995
|
|
|
|
|
|
|
|
D.
CIAC
|
|
|
To
reflect the appropriate balance.
|
298,468
|
|
|
|
|
|
|
|
E.
Accumulated Amortization of CIAC
|
|
|
To
reflect the appropriate balance.
|
(316,272)
|
|
|
|
|
|
|
|
|
|
|
Total Adjustments to Net Book Value as of August 31, 2022
|
($40,997)
|
|
|
|
CSWR-Florida Utility Operating
Company, LLC
Sebring Ridge Utilities, Inc.
Schedule of Staffs
Recommended Account Balances as of August 31, 2022
|
Account
No.
|
Description
|
UPIS
|
Accumulated Depreciation
|
|
354
|
Structures &
Improvements
|
$14,419
|
($8,423)
|
|
360
|
Collection Sewers - Force
|
10,264
|
(10,264)
|
|
361
|
Collection Sewers - Gravity
|
160,220
|
(160,220)
|
|
362
|
Special Collection Structures
|
76,537
|
(76,537)
|
|
371
|
Pumping Equipment
|
26,597
|
(5,064)
|
|
380
|
Treatment and Disposal Equipment
|
145,362
|
(145,362)
|
|
381
|
Plant Sewers
|
660
|
(605)
|
|
389
|
Other Plant & Misc.
Equipment
|
60
|
(45)
|
|
390
|
Office Furniture and Equipment
|
509
|
(509)
|
|
396
|
Communication Equipment
|
1,124
|
(1,124)
|
|
|
|
|
|
|
|
Total
|
$435,752
|
($408,160)
|
CSWR-Florida Utility
Operating Company, LLC.
Sebring Ridge Utilities,
Inc.
Monthly Wastewater Rates
|
Residential
Service
|
|
|
|
All Meter Sizes
|
|
$16.17
|
|
|
|
|
|
Charge Per 1,000 gallons Residential
|
|
$3.51
|
|
10,000 gallon cap
|
|
|
|
|
|
|
|
General Service
|
|
|
|
Base
Facility Charge by Meter Size
|
|
|
|
5/8 x 3/4"
|
|
$16.17
|
|
3/4"
|
|
$24.26
|
|
1
|
|
$40.43
|
|
1-1/2
|
|
$80.85
|
|
2
|
|
$129.36
|
|
3
|
|
$258.72
|
|
4
|
|
$404.25
|
|
6
|
|
$808.50
|
|
|
|
|
|
Charge
Per 1,000 gallons General Service
|
|
$4.20
|
|
|
|
|
|
Initial
Customer Deposits
|
|
|
|
|
|
|
|
Residential
Service and General Service
|
|
|
|
|
5/8
x 3/4
|
|
$50.00
|
|
|
All
over 5/8 x 3/4
|
|
2x
Average Estimated Bill
|
|
|
|
|
|
|
|
|
Service Availability
Charges
|
|
|
|
|
|
Main Extension Charge
|
|
|
|
Residential per ERC (350 GPD)
|
|
$385.00
|
|
All others per gallon
|
|
$1.10
|
|
|
|
|
|
Plant Capacity Charge
|
|
|
|
Residential per ERC (350 GPD)
|
|
$315.00
|
|
All others per gallon
|
|
$0.90
|
|
|
|
|