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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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September 19, 2024
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TO:
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Office of Commission Clerk (Teitzman)
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FROM:
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Office of the General Counsel (Marquez) AEH
Division of Accounting and Finance (Richards, Higgins,
Kelley, Mouring) ALM
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RE:
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Docket No. 20230131-WS – Application for
staff-assisted rate case in Putnam County, by St. Johns River Estates
Utilities, LLC
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AGENDA:
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10/01/2024 – Regular Agenda
– 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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Clark
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CRITICAL DATES:
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April 30, 2025 (15-month statutory deadline pursuant to
Section 367.0814(2), Florida Statutes)
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SPECIAL INSTRUCTIONS:
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None
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Case Background
St. Johns River
Estates Utilities, LLC (“St. Johns” or “Utility”) is a water and wastewater
utility serving approximately 90 customers in Putnam County, Florida. On
November 30, 2023, St. Johns filed an application for staff-assisted rate case
(“SARC”) pursuant to Section 367.0814, Florida Statutes (“F.S.”), and Rule 25-30.455,
Florida Administrative Code (“F.A.C.”). The application was accepted by Florida
Public Service Commission Staff (“Commission staff”) on December 22, 2023. However, St. Johns failed to remit its
$1,200 filing fee which resulted in an application denial.
St. Johns then
filed a new application for SARC on January 30, 2024, coupled with its $1,200
filing fee. This second application was accepted by
Commission staff with January 30, 2024, as the official date of filing.
After
acceptance, Commission staff determined that St. Johns was no longer eligible
for a SARC because the Utility is not in compliance with Commission rules that
require the filing of an Annual Report and payment of regulatory assessment
fees (“RAFs”). A notice of late Annual Report and delinquent RAFs for 2023 was
sent to St. Johns via certified U.S. mail on August 1, 2024.
The Commission
has jurisdiction over this matter pursuant to Section 367.0814, F.S.
Discussion
of Issues
Issue 1:
Does St. Johns remain eligible for a SARC?
Recommendation:
No. An applicant must continuously meet all
eligibility criteria in Rule 25-30.455(1), F.A.C., to qualify for a SARC. St.
Johns’ failure to pay its 2023 RAF balance means it is not eligible for a SARC
at this time. Therefore, the Commission should deny the SARC application.
(Marquez)
Staff Analysis:
To be eligible for a SARC, an applicant must meet
certain threshold requirements detailed in Rule 25-30.455(1)(a)–(c), F.A.C.
Specifically, it must (1) have total gross annual operating revenues no more
than $335,000 for water service or wastewater service (or $670,000 on a
combined basis); (2) have at least one year of experience operating the utility
for which the rate increase is sought; (3) be in compliance with annual report
filings pursuant to Rule 25-30.110(3)–(5), F.A.C.; and (4) be up-to-date with
all RAF payments. Failure to satisfy any one of those criteria renders a
utility ineligible for a SARC.
On August 1, 2024, Commission staff sent a certified
letter to St. Johns. The letter notified the Utility of the change in
circumstances now making it ineligible for a SARC. Nonetheless, Commission
staff provided St. Johns over three weeks time to remedy the deficiencies. St.
Johns needed to do the following by August 23, 2024:
(1)
File its 2023 Annual Report;
(2)
Pay an Annual Report late fee of $485.00;
(3)
Pay the 2023 water RAF, including penalties, of
$959.82; and
(4)
Pay the 2023 wastewater RAF, including penalties, of
$1,293.26.
Pursuant to Rule 25-30.110(3)(a), F.A.C., each utility
must file an annual report with the Commission by March 31st for the
preceding year ending December 31st. St. Johns filed its 2023 Annual
Report five months late on August 16, 2024. Rule 25-30.110(6), F.A.C., sets
forth the penalties for delinquent annual reports. The applicable penalty for a
Class C utility is $3.00 per day plus interest, based on the number of calendar
days elapsed from the date due until the date filed. St. Johns remitted a check
to cover the late fee in the amount of $420. Although not the full sum
required, Commission staff is willing to waive the remaining balance of less
than $50.00.
Pursuant to Rule 25-30.120(2)(b), F.A.C., small water and
wastewater utilities must file their RAFs with the Commission by March 31st
for the proceeding year ending December 31st. St. Johns has not paid
its 2023 regulatory assessment fees. As
of August 23, 2024, the amount due for 2023 water RAF, plus penalties pursuant
to Rule 25-30.120(7), F.A.C., was $959.82.
As of the same date, the amount due for 2023 wastewater RAF, plus
penalties, was $1,293.26. The Commission has not received payment. Nor has St.
Johns entered into a RAF repayment plan.
To date, the RAF payments remain outstanding. Commission
staff recommends that the Commission deny the SARC application because St.
Johns’ failure to pay RAFs has rendered it ineligible to qualify for a SARC
pursuant to Rule 25-30.455(1), F.A.C.
Issue 2:
Should this docket be closed?
Recommendation:
Yes. (Marquez)
Staff Analysis:
Having denied St. Johns’ application for SARC, the
docket should be closed.