Discussion
of Issues
Issue 1:
Should Wildwood Water Company be required to show
cause why it should not be fined for an apparent violation of Section
367.071(1), F.S., and Rule 25-30.037(1)(a), F.A.C., for failing to obtain
Commission approval prior to the transfer of majority organizational control,
and failing to submit an application to the Commission for authority to
transfer no later than 90 days after the transfer of majority organizational
control?
Recommendation:
No. Staff recommends that the Utility’s apparent
violation of Section 367.071(1), F.S., and Rule 25-30.037(1)(a), F.A.C., does
not rise to the level which warrants the initiation of a show cause proceeding.
However, Wildwood should be placed on notice that show cause proceedings may be
initiated if further violations of Commission laws or rules regarding the
transfer of certificates are identified. (Dose)
Staff Analysis:
Legal Standard
Section 367.071(1), F.S., provides that no utility shall
transfer its certificate of authorization, facilities or any portion thereof,
or majority organizational control without determination and approval of the Commission
that the proposed transfer is in the public interest and that the buyer,
assignee, or transferee will fulfill the commitments, obligations, and
representations of the utility. However, a transfer of certificate of
authorization, facilities or any portion thereof, or majority organizational
control may occur prior to Commission approval if the contract for sale,
assignment, or transfer is made contingent upon Commission approval.
Furthermore, Rule 25-30.037(1)(a), F.A.C., provides that
if a transfer occurs prior to Commission approval, the utility shall submit an
application for authority to transfer no later than 90 days after the sale
closing date.
Violations of the provisions of any lawful rule or any
statute administered by the Commission may result in penalties as provided by
Section 367.161, F.S. In particular, violations of the provisions of Chapter
367, F.S., or any rule adopted pursuant to the Chapter, may result in a penalty
for each offense of not more than $5,000. Utilities are charged with the
knowledge of Commission rules and statutes. 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). The Commission considers the existence of mitigating circumstances
when deciding whether to pursue show cause proceedings against utilities.
Analysis
On December 15, 2025, Wildwood submitted an application
for authority to transfer majority organizational control of the Utility and
Certificate No. 648-W in St. Johns County. The Transferee has been in control
of and operating Wildwood since 2020, following the death of the Transferee’s
parents. Notably, there was no contract of sale or transfer as the transfer occurred
by inheritance.
By failing to file its transfer application within 90 days
of the transfer of majority organizational control, it appears that Wildwood
violated Section 367.071(1), F.S., and Rule 25-30.037(1)(a), F.A.C. On November
17, 2025, Wildwood Water Company was emailed a letter denying the Utility’s
eligibility for a staff-assisted rate case because the transfer of majority
organizational control was not yet approved by the Commission. Staff
recommended that the Utility submit an application for a transfer of majority
organizational control in accordance with Rule 25-30.037, F.A.C. Since learning
of its violations, Wildwood has shown diligence in working with Commission
staff to ensure the transfer of this system is in conformity with Commission
laws and rules.
Staff believes that Wildwood has made a good faith effort
to effect a lawful transfer of majority organizational control of this system,
and that the transfer is in the best interest of its customers. Because the
Utility has been responsive in coming into compliance with the applicable rules
and statutes regarding transfer of certificates, staff recommends that the
Utility’s apparent violation of Section 367.071(1), F.S., and Rule
25-30.037(1)(a), F.A.C., does not rise to the level which warrants the
initiation of a show cause proceeding. Therefore, Wildwood should not be
required to show cause for failing to obtain Commission approval prior to
closing on the sale of its facilities, and failing to submit an application to
the Commission for authority to transfer no later than 90 days after the
transfer of majority organizational control. However, Wildwood should be placed
on notice that show cause proceedings may be initiated if further violations of
the Commission laws or rules regarding the transfer of certificates are
identified.
Issue 2:
Should the application for transfer of majority
organizational control of Wildwood Water Company in St. Johns County be
approved?
Recommendation:
Yes. The transfer of majority organizational control
from Gerald E. Mills and Diane N. Mills to G. Gregory Mills is in the public
interest and should be approved effective the date of the Commission vote. The
resultant order should serve as the water and wastewater certificates, with the
territories described in Attachment A for the Utility. The Utility’s existing
rates and charges should remain in effect until a change is authorized by the
Commission in a subsequent proceeding. For the Utility, 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. (Davis,
Rashawn, Dose)
Staff Analysis:
Legal Standard
Applications for the sale, assignment, or transfer of
certificates of authorization, facilities, or control for water and wastewater
utilities are governed by Section 367.071, F.S., and Rule 25-30.037, F.A.C. The
statute provides that a utility may not sell, assign, or transfer its
certificate of authorization, facilities, or any portion thereof, or majority
organization control without a determination by the Commission that the sale,
assignment, or transfer is in the public interest and that the buyer will
fulfill all commitments, obligations, and representations of the utility. A
sale, assignment, or transfer of a certificate of authorization may occur prior
to Commission approval if the contract for sale, assignment, or transfer is
made contingent upon Commission approval. The rule provides all of the
requirements an applicant must provide in an application for sale, assignment,
or transfer of a certificate of authorization.
Analysis
This application is for the transfer of majority
organizational control of Wildwood Water Company in St. Johns County from Gerald
E. Mills and Diane N. Mills to G. Gregory Mills. Based on staff’s review, the
application is in compliance with the governing statute, Section 367.071, F.S.,
and Rule 25-30.037(4), F.A.C., concerning applications for transfer of majority
organizational control. As majority organizational control was acquired through
inheritance, there is no applicable contract for sale.
Noticing and Territory
Wildwood provided notice of its application pursuant to
Section 367.071, F.S., and Rule 25-30.030, F.A.C. No objections to the transfer
were filed with the Commission, and the time for doing so has expired. The
notice contains a description of the territory for Wildwood, which is appended
to this recommendation as Attachment A.
Technical and Financial Ability
The Transferee has experience in operating water systems
since 1978, and has been operating the Wildwood system since 1988 through the
present. Based upon a staff review, the system appears to currently be in
compliance with the Department of Environmental Protection. The transfer
application states that the Transferee is supported by an affiliate company,
Holy Grail Holdings, LLC. Staff has reviewed the financial statements of the
affiliate company and believes it has the financial capability to provide
necessary funding and has established a line of credit to ensure continued
operations. Based on the statement above, staff recommends the Transferee has
the technical and financial capability to provide service to the existing service
territory.
Rates, Charges, and Initial Customer
Deposits
Wildwood
Water Company’s rates, charges, and customer deposits were last approved in a
grandfather certificate in 2010.
Subsequently, the rates were amended by three price index rate adjustments with
the last increase approved effective September 1, 2021. 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 this Commission.
In regard to the Utility’s existing miscellaneous service
charges, the violation reconnection, the late payment, and non-sufficient funds
(NSF) charges are appropriate. However, the remaining miscellaneous service
charges do not conform to Rule 25-30.460, F.A.C., and are discussed in Issue 3.
Therefore, staff recommends that the Utility’s existing rates, initial customer
deposit, violation reconnection charge, late payment charge, NSF charge, and
service availability charges shown on Schedule No. 1, should remain in effect,
until a change is authorized by this Commission in a subsequent proceeding. The
tariff sheets reflecting the transfer should be effective on or after the
stamped approval date pursuant to Rule 25-30.475(1), F.A.C.
Conclusion
Based on the above, staff recommends that the transfer of
the majority organizational control from Gerald E. Mills and Diane N. Mills to
G. Gregory Mills is in the public interest and should be approved effective the
date of the Commission vote. The resultant order should serve as the water and
wastewater certificates, with the territories described in Attachment A. The
Utility’s existing rates and charges should remain in effect until a change is
authorized by the Commission in a subsequent proceeding. For the Utility, 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.
Issue 3:
What are the appropriate revisions to miscellaneous
service charges for Wildwood Water Company?
Recommendation:
The appropriate revisions to miscellaneous service
charges for Wildwood Water Company should be the removal of initial connection
and normal reconnection charges and update the definition of the premises visit
charge to be consistent with Rule 25-30.460, F.A.C. The Utility should be
required to file a proposed customer notice to reflect the Commission-approved
charges. The approved charges should be effective 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 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 notice was given, no
less than 10 days after the date of the notice. Wildwood should be required to
charge the approved miscellaneous services charges until authorized to change
them by the Commission in a subsequent proceeding. (Rashawn)
Staff Analysis:
The Utility did not request to revise its existing
miscellaneous service charges. Section 367.091, F.S., authorizes the Commission
to establish, increase, or change rates or charges other than monthly rates or
service availability charges. Rule 25-30.460, F.A.C. does not allow for initial
connection and normal reconnection charges. The Utility’s initial connection
and normal reconnection charges are obsolete and inconsistent with the rule.
The definitions for initial connection charges and normal reconnection charges
were subsumed in the definition of the premises visit charge. Based on the
above, staff recommends that the initial connection and normal reconnection
charges be removed, and the definition for the premises visit charge be updated
to comply with Rule 25-30.460, F.A.C.
Conclusion
Staff recommends that the appropriate revisions to
miscellaneous service charges for Wildwood should be the removal of initial
connection and normal reconnection charges and update the definition of the
premises visit charge to be consistent with Rule 25-30.460, F.A.C. The Utility
should be required to file a proposed customer notice to reflect the
Commission-approved charges. The approved charges should be effective 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 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 notice was given, no less than 10 days after the date of the notice.
Wildwood should be required to charge the approved miscellaneous services
charges until authorized to change them by the Commission in a subsequent
proceeding.
Issue 4:
Should this docket be closed?
Recommendation:
If no person whose substantial interests are
affected by the proposed agency action portion of this recommendation files a
protest within 21 days of the issuance of this order, a consummating order
should be issued. (Dose)
Staff Analysis:
If no person whose substantial interests are
affected by the proposed agency action portion of this recommendation files a
protest within 21 days of the issuance of this order, a consummating order
should be issued.
