Discussion
of Issues
Issue 1:
Should the application for a water and wastewater
certificate by Applegate Utility, LLC be approved?
Recommendation:
Yes. Applegate should be granted Certificate Nos. 682-W
and 582-S to serve the territory described in Attachment A, which is appended
to this recommendation, effective the date of the Commission’s vote. The
resultant order should serve as Applegate’s water and wastewater certificates
and should be retained by the Utility. Applegate should submit the recorded
deeds for continued access to the land upon which its facilities are located to
the Commission within 60 days of the Order granting the certificates, which is
final agency action. (M. Watts, Przygocki)
Staff Analysis:
On October 10, 2023, Applegate filed its application
for original water and wastewater certificates in Volusia County. Upon review,
staff determined the original filing was deficient and issued a deficiency
letter on November 13, 2023, followed by a second deficiency letter on December
14, 2023. The Utility cured the deficiencies on January 3, 2024, which is
considered the official filing date for the application. The Utility’s
application is in compliance with the governing statutes, Sections 367.031 and
367.045, F.S.
Notice
On October 25, 2023,
and October 30, 2023,
Applegate filed proof of compliance with the noticing provisions set forth in
Rule 25.30.030, F.A.C. No entity filed a protest during the protest period and
the time for filing objections has expired.
Land Ownership and Service Territory
Applegate provided adequate service territory maps, system
maps, and a territory description, as required by Rule 25.30.034(1)(k), F.A.C.
The legal description of the service territory is appended to this
recommendation as Attachment A. The Utility’s application included an executed
but unrecorded 99-year lease for the land where the water and wastewater
treatment facilities are located, pursuant to Rule 25-30.034(1)(m), F.A.C. In
response to staff’s first data request, Applegate explained that it would
record the executed lease in the Volusia County Public Records upon issuance of
the Commission’s Order approving the original certificate. Applegate should
submit the recorded deeds for continued access to the land upon which its
facilities are located to the Commission within 60 days of the Order granting
the certificates.
Financial and Technical Ability
Rule 25.30.034(1)(i), F.A.C., requires a statement showing
the financial ability of the applicant to provide service, a detailed financial
statement, and a list of all entities upon which the applicant is relying to
provide funding along with those entities' financial statements. Applegate is a
newly formed entity and has no financial statements at this time. Applegate is
relying fully upon funds provided by Consolidated Parakeet Holding Company
(Parakeet). The application contains Parakeet’s most recent balance sheet. Additionally,
in response to staff’s first deficiency letter, Applegate provided a profit and
loss statement for Parakeet. Further, the Utility provided an affidavit from
Parakeet assuring it will provide or assist Applegate in securing any necessary
funding. Staff believes that Parakeet’s financial statements and affidavit
adequately demonstrate its ability to provide resources and support the
Utility’s water and wastewater operations. Therefore, staff recommends that
Applegate has demonstrated that it will have access to adequate financial
resources to operate the Utility.
Rule 25-30.034(1)(j), F.A.C., requires the applicant to
demonstrate the technical abilities to provide service. The application
contains a statement describing the technical ability of the Utility to provide
service to the proposed service area. The owner of Applegate stated he has no
prior utility operation experience in Florida; however, the owner and its
affiliates have operated water and wastewater systems throughout the United
States. Additionally, the owner committed to employing the appropriate
operational, technical, and managerial personnel, who are knowledgeable and experienced
in utility operation, as well as contracting experienced personnel and
consultants to ensure the continuous operation and management of the utility
system in an efficient and effective manner. Based on the above, Applegate has
demonstrated the financial and technical ability to provide service to the
existing service territory.
Conclusion
Based on the above, staff recommends that it is in the
public interest to grant Applegate Certificate Nos. 682-W and 582-S to serve
the territory described in Attachment A, effective the date of the Commission’s
vote. The resultant order should serve as Applegate’s water and wastewater
certificates and it should be retained by the Utility. Applegate should submit
the recorded deeds for continued access to the land upon which its facilities
are located to the Commission within 60 days of the Order granting the
certificates, which is final agency action.
Issue 2:
What rates and charges should be approved for
Applegate Utility, LLC?
Recommendation:
The rates and charges shown on Schedule No. 1
should be approved for Applegate. The Utility should be authorized to bill all
customers on a monthly basis. The Utility should be required to notice all
customers of the approved rates and charges. The notice should be approved by
staff prior to publication and the Utility should provide proof of the date
notice was given, within 10 days of the date of the notice. The approved rates
and charges should be effective for service rendered on or after the effective
date of the tariffs, pursuant to Rule 25-30.475, F.A.C. (Sibley)
Staff Analysis:
The Utility provides service to 144
residential customers, which includes water and wastewater service to
approximately 88 mobile home park customers and 56 offsite water only
customers. The offsite water only customers have septic tanks for wastewater
service. The water rates consist of a monthly base facility charge for a 5/8
inch x 3/4 inch meter size of $15.00 and a gallonage charge per 1,000 gallons
of $6.25 for residential. For wastewater, its tariff consists of a monthly
residential flat rate of $15.98.
Premises Visit and Violation
Reconnection Charge
For miscellaneous service charges,
the Utility charges $15.00 for initial reconnection, and according to the
Utility, no other miscellaneous service charges have been assessed in the past.
Rule 25-30.460, F.A.C., does not allow for initial
connection and normal reconnection charges. The Utility’s initial connection is
obsolete and inconsistent with the rule. Therefore, staff recommends that the
initial connection charge be removed. Staff recommends a premises visit and
violation reconnection charge of $15, and the definition for the premises visit
charge be updated to comply with Rule 25-30.460, F.A.C. A violation reconnection
accounts for the discontinuance of service and subsequent reconnection of
service. Therefore, the water violation reconnection charge should account for
both services at a charge of $30.00 ($15.00 x 2). For wastewater, the violation
reconnection charge should be at actual cost, pursuant to Rule 25-30.460(2)(b),
F.A.C.
Service Availability
Charge
The Utility’s proposed tariff indicates
a meter installation charge of $65 for a 5/8 inch x 3/4 inch meter size and
actual cost for all other meter sizes. The Utility also has a service line
extension and tap-in at actual cost. In its application, the Utility’s
service availability policy states that the water distribution service is
currently in place to serve all lots within the service area. New connections
shall pay the approved meter installation charge at the time service is
requested. Furthermore, it shall be the customer’s responsibility to connect
its service lateral to the water meter. For wastewater, there are no service
availability charges. Staff believes the service availability policy is
appropriate and should be approved.
Conclusion
Based on the above, staff recommends that the rates and
charges shown on Schedule No. 1 should be approved for Applegate. The Utility
should be authorized to bill all customers on a monthly basis. The Utility
should be required to notice all customers of the approved rates and charges.
The notice should be approved by staff prior to publication and the Utility
should provide proof of the date notice was given within 10 days of the date of
the notice. The tariff should be effective for service rendered or connections
made on or after the stamped approval date on the tariff sheets,
pursuant to Rule 25-30.475, F.A.C.
Issue 3:
What are the appropriate initial customer deposits
for the water and wastewater systems of Applegate Utility, LLC?
Recommendation:
The appropriate initial
customer deposits for the residential 5/8 inch x 3/4 inch meter size should be
$82 for water and $84 for wastewater. The initial customer deposits for all
other residential meter sizes and all general service meter sizes should be two
times the average estimated bill. The approved initial customer deposits should
be effective for services rendered or connections made on or after the stamped
approval date on the tariff sheets pursuant to Rule 25-30.475, F.A.C. The
Utility should be required to collect the approved deposits until authorized to
change them by the Commission in a subsequent proceeding. (Sibley)
Staff Analysis:
Rule 25-30.311, F.A.C.,
provides the criteria for collecting, administering, and refunding customer
deposits. Customer deposits are designed to minimize the exposure of bad debt
expense for the Utility and, ultimately, the general body of ratepayers. An
initial customer deposit ensures that the cost of providing service is
recovered from the cost causer. Historically, the Commission has set initial
customer deposits equal to two times the average estimated bill. The Utility’s average monthly residential usage is 4,139
gallons per month for water and wastewater. Therefore, the average residential monthly
bill is approximately $41 for water and $42 for wastewater service based on staff’s
recommended rates.
Staff recommends the appropriate
initial customer deposits for the residential 5/8 inch x 3/4 inch meter size
should be $82 for water and $84 for wastewater. The initial customer deposits
for all other residential meter sizes and all general service meter sizes
should be two times the average estimated bill. The approved initial customer
deposits should be effective for services rendered or connections made on or
after the stamped approval date on the tariff sheets, pursuant to Rule
25-30.475, F.A.C. The Utility should be required to collect the approved
deposits until authorized to change them by the Commission in a subsequent
proceeding.
Issue 4:
Should
this docket be closed?
Recommendation:
Yes. If no person whose substantial interests are
affected by the proposed agency actions in Issues 2 and 3 files a protest
within 21 days of the issuance of the order, a consummating order should be
issued. The docket should remain open for staff’s verification that the revised
tariff sheets and customer notice have been filed by the Utility and approved
by staff. Once these actions are complete, this docket should be closed
administratively. (Sparks)
Staff Analysis:
If no person whose substantial interests are
affected by the proposed agency actions in Issues 2 and 3 files a protest
within 21 days of the issuance of the order, a consummating order should be
issued. The docket should remain open for staff’s verification that the revised
tariff sheets and customer notice have been filed by the Utility and approved
by staff. Once these actions are complete, this docket should be closed
administratively.
APPLEGATE
UTILITY, LLC
Water and Wastewater Service Area
ALL
OF LOTS A AND B, AND THE NORTH 1/2 OF LOT C, NORTHWOOD SUBDIVISION, ACCORDING
TO THE MAP OR PLAT THEREOF AS RECORDED IN MAP BOOK 6, PAGE 156, OF THE PUBLIC
RECORDS OF VOLUSIA COUNTY, FLORIDA LOCATED IN SECTION 28, TOWNSHIP 16 SOUTH
RANGE 30 EAST, AND THAT PART OF GOVERNMENT LOT 4, SECTION 29, TOWNSHIP 16
SOUTH, RANGE 30 EAST, VOLUSIA COUNTY, FLORIDA, ALL BEING DESCRIBED AS FOLLOWS:
BEGIN
AT A POINT ON THE SOUTHEASTERLY LINE OF THE DOMINGO REYES GRANT, SECTION 38,
TOWNSHIP 16 SOUTH, RANGE 30 EAST, BEING THE NORTHWEST CORNER OF SECTION 28,
TOWNSHIP 16 SOUTH, RANGE 30 EAST, VOLUSIA COUNTY, FLORIDA; THENCE
N49°10'51"E ALONG THE NORTHWESTERLY LINE OF SAID SECTION 28 AND THE
SOUTHWESTERLY LINE OF SAID DOMINGO REYES GRANT, A DISTANCE OF 1,543.69 FEET TO
A POINT ON THE WEST RIGHT-OF-WAY LINE OF STATE ROAD NO. 11, HAVING A 200.00
FOOT RIGHT-OF-WAY; THENCE S00°43'19"E ALONG THE WEST RIGHT-OF-WAY OF SAID
STATE ROAD NO. 11, A DISTANCE OF 1,312.31 FEET TO A POINT ON THE SOUTH LINE OF
THE NORTH 1/2 OF LOT C, NORTHWOOD SUBDIVISION, ACCORDING TO THE MAP OR PLAT
THEREOF, AS RECORDED IN MAP BOOK 6, PAGE 156, OF THE PUBLIC RECORDS OF VOLUSIA
COUNTY, FLORIDA; THENCE S89°35'41"W ALONG THE SOUTH LINE OF THE NORTH 1/2
OF SAID LOT C, A DISTANCE OF 1,180.87 FEET TO A POINT ON THE EAST LINE OF
GOVERNMENT LOT 4, SECTION 29, TOWNSHIP 16 SOUTH, RANGE 30 EAST, VOLUSIA COUNTY,
FLORIDA; THENCE S00°43'19"E ALONG THE EAST LINE OF SAID GOVERNMENT LOT 4,
A DISTANCE OF 244.42 FEET TO A POINT ON THE SOUTHERLY BOUNDARY LINE OF PARCEL
3, AS DESCRIBED IN OFFICIAL RECORDS BOOK 8125, PAGE 4012, OF THE PUBLIC RECORDS
OF VOLUSIA COUNTY, FLORIDA; THENCE DEPARTING SAID EAST LINE, RUN
S50°22'13"W ALONG SAID SOUTHERLY BOUNDARY LINE, A DISTANCE OF 412.73 FEET TO
THE SOUTHWEST CORNER OF SAID PARCEL 3; THENCE N41°38'55"W ALONG THE
WESTERLY BOUNDARY LINE OF SAID LANDS, A DISTANCE OF 416.74 FEET TO A POINT ON
AFORESAID SOUTHEASTERLY LINE OF THE DOMINGO REYES GRANT AND THE NORTHWESTERLY
LINE OF AFORESAID SECTION 29, TOWNSHIP 16 SOUTH, RANGE 30 EAST; THENCE
N49°10'51"E, ALONG SAID NORTHWESTERLY LINE OF SECTION 29 AND THE
SOUTHEASTERLY LINE OF THE DOMINGO REYES GRANT, A DISTANCE OF 776.75 FEET TO THE
POINT OF BEGINNING.
SAID
LANDS CONTAINING 27.77 ACRES, MORE OR LESS.
FLORIDA PUBLIC SERVICE COMMISSION
Authorizes
Applegate Utility,
LLC
pursuant to
Certificate Number 682-W
to provide water service in Volusia
County in accordance with the provisions of Chapter 367, Florida Statutes,
and the Rule, 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
* * 20230114-WS Original Certificate
* Order
Number and date to be provided at time of issuance.
FLORIDA PUBLIC SERVICE COMMISSION
Authorizes
Applegate Utility,
LLC
pursuant to
Certificate Number 582-S
to provide wastewater service in Volusia
County in accordance with the provisions of Chapter 367, Florida Statutes,
and the Rule, 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
* * 20230114-WS Original Certificate
* Order
Number and date to be provided at time of issuance.
