LAKE WATER COMPANY, LLC AUG A WYOMING LIMITED LIABILITY COMPANY P0 BOX 453 WHEATLAND, WY Voo

Transcription

1 PUBLIC SERCMISON LAKE WATER COMPANY, LLC AUG A WYOMING LIMITED LIABILITY COMPANY P0 BOX 453 WHEATLAND, WY Public Service Commission Hansen Building, Suite Warren Ave. Cheyenne, WY cv Voo Commissioners: Lake Water Company, LLC respectfully submits its application for an increase in the rates it charges for retail water service in the Lakeshore Tracts subdivision and State Parks Cabin Area at Glendo Lake, Wyoming. As of this filing, Lake Water Company, LLC provides water to ninety-one (91) residential water accounts in these areas. Most of these ninety-one water accounts are made up of seasonal residents from various states. There are 6 full year residents currently on the system. Water rates were last increased in 2006 and a rate increase is now needed to cover increased utility charges, increased fuel charges and increased repair and maintenance expenses incurred by Lake Water Company, LLC. In order that Lake Water Company, LLC may cover its cost to serve, Lake Water is requesting that the rates for water service be increased to $ per year. Lake Water Company, LLC is also requesting an increase of the initial tap fee from $ to $1, In support of this application, Lake Water Company, LLC has attached a future cost of service analysis and discussion, and depreciation schedule of current assets. Lake Water Company, LLC proposes that the new tariff be effective for billing purposes on and after January 1, The company requests that we be allowed to provide a copy of the Public Notice to our customers by either hand delivery or mail because of the seasonal nature of our customers. If you have any questions regarding our request, please contact me. Bill Birkie Member Manager Lake Water Company, LLC cc:michele McGuire, CPA

2 . (1) FormNo.6: REPORT OF TARIFF CHANGE Name of utility Lake Water Company, LLC Address main office P0 Box 1153 Wheatland. WY Water Tariff P.S.C.Wyo.No. 3 SheetNo. 1-7 (Class of Service) (New tariff designation) Change Rates from $395/year to $600/year, increase tap fee from $500 to $1500, instate (State part of tariff affected by change, such as: applicability, availability, rates, etc.) reconnect fee of $600 Reason for change Provide enough revenue to cover annual costs and rebuild reserves for improving infrastructure. Approximate annual reduction in revenue $ Approximate annual increase in revenue $ 18, Points affected Estimated number of customers whose cost of service will be: Reduced Increased Unchanged 91 Remarks: Lake. Water Company, LLC (Reportin tility) By.4/ 62 (Name and title)

3 .. THE PUBLIC SERVICE COMMISSION OF WYOMING NAME: Lake Water Company, LLC Wyo. P.S.C. Tariff No.3 Original Sheet No. 1 ADDRESS: P0 Box 453, Wheatland, WY Cancels: Wyo. P.S.C. Tariff 2 Sheet No.! SERVICE: Water AVAILABLE: Lakeshore Tracts Subdivision and Glendo State Parks Cabin Area at Glendo Lake, Wyoming. APPLICABLE: Domestic Use RATE: Flat rate of $ per year, unmetered, with option to pay monthly. Reconnect fee - rate of $ Tap fee Flat $ MINIMuM BILL: Each customer desiring service obligates himself for the billing for DISCOUNTS: None the calendar year or pro-rata share thereof remaining. RULES AND REGULATIONS: Rules and Regulations approved and on file with the Wyoming Public Service Commission Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1,2011

4 Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #2 GENERAL RULES AND REGULATIONS WATER SERVICE Water service will be supplied by Lake Water Company, LLC (hereinafter referred to as the Company) to it s Customers in Lake Shore Tract Subdivision area, a residential subdivision located in Platte County, Wyoming, and at cabin sites leased within its permitted area in accordance with the provisions of the General Rules and Regulations herein prescribed. APPLICATION OF RULES: These rules shall apply to any person, firm or corporation who now is, or may hereafter become a residential Customer of the Company. 1. APPLICATION FOR SERVICE: The Company may require each prospective Customer to sign an application for service. Each application must be in writing on standard forms furnished by the Company and shall set forth such information as the Company may require to determine service and billing matters or such other information as the Company may reasonably require. The application is merely a written request for service, and does not in itself bind the Company to serve. No person may connect to the Company s main lines without prior written approval of the Company and payment of the required tap fee, 2. CONNECTION OF SERVICE: (a) The Customer shall pay all costs incurred in connecting his private water service lines to the Company s main and shall install, at his expense, a shut-off valve near the connection at a point and in a manner accessible to and acceptable by the Company. (b) Customer s service termination on Customer s premises shall be so located as to make the shut-off valve easily accessible and convenient for the installation, operation, protection, and maintenance of the Company s equipment. (c) The Company shall not be required to provide more than one connection direct from its distribution mains to the service pipe of any one customer. Each Customer shall install and maintain, at his own expense, all piping, plumbing, equipment and faucets, including a shut-off valve in a curb box meeting the Company s specifications, to the point of connection to the Company s distribution mains. (d) Each connection shall be used to serve only one lot. Use of water on a lot other than that connected, even if owned by the same customer, will require another tap fee and charge for water service. Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

5 Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #3 3. REFUSAL OF SERVICE: (a) The Company may decline to serve any customer until he has complied with the State and County regulations governing water service and with the Rules and Regulations of the Company. (b) The Company may decline to serve any Customer if, in the opinion of the Company, it does not have adequate facilities to render the service applied for, or if the desired service is of a character likely to unfavorably affect service to other Customers. (c) The Company may refuse to reconnect a service when service at that address has been previously been disconnected for nonpayment of service charges, which remain unpaid. This paragraph does not apply to new owners or new purchasers of said address, nor does it apply when a debt is discharged by a court of competent jurisdiction. 4. DICONT1NUANCE OF SERVICE: (a) Every Customer who wishes to have such service transferred to a new owner, shall give three (3) day s notice in advance of specified date of transfer of service. Until the Company shall have such notice, the Customer shall be held responsible for all service rendered at this location. (b) Service may be discontinued for non-payment of past due bills or for violation of the General Rules and Regulations (Rules) of the Company. Prior to discontinuance of service, a certified letter shall be sent to the Customer, giving the Customer written notice that his bill is delinquent and that he shall have seven (7) days in which to cure the delinquency or violation(s) of the Rules; provided, however that where fraudulent use of service is detected, or where a dangerous condition is found to exist on Customer s premises, service may be discontinued without advance notice. The written notice and its delivery shall be in compliance with the current Rules of the Public Service Commission of Wyoming. The Company shall attempt to notify Customer(s) personally before disconnecting service during the months of November through April (c) Whenever service is discontinued by disconnection for nonpayment of bills, or for violation of the Rules and Regulations, a reconnecting charge in the amount of the tap fee in the approved rate schedule will be assessed and must be paid along with all outstanding charges before service will be restored. Reconnection fee also applies to customer initiated reconnection after disconnection. (d) Whenever service is discontinued by disconnection because of fraudulent use, the Company may also require a satisfactory payment for service rendered, (in addition to such reconnecting charge) before service is restored. 5. INSPECTION AND BILLING: (a) Customer shall give the Company, or its authorized agents, permission to enter Customer s premises at all reasonable times for the purpose of installing, Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

6 Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #4 inspecting, repairing or removing any or all of its apparatus used in connection with the supply of water. (b) Bills will be sent once (annually) on or before February 1st, and shall be due and payable by the twentieth (20 th) day of the month. Being that some residents are non permanent, this time frame will allow them the opportunity to receive the bill and get the payment back in time. Bills will be considered delinquent ten (10) days after the due date. Customers may elect to pay their bills monthly, quarterly, semi-annually or annually by checking the appropriate box on their billing. Once a customer elects the method of payment he wishes to make (e.g., quarterly to monthly and vice versa). Billings will be considered delinquent if not paid by the tenth day after the due date. Late charges for delinquent payments shall bear interest at an annual rate of eighteen percent (18%). No reduction of amounts billed will be allowed due to loss of water due to waste caused by leakage of equipment or at the connection of Customer. (c) The Company reserves the right to install such other devices as may be necessary for the detection and prevention of fraud or waste without notice to Customer. (d) Should damage result to Company lines and equipment from molestation or willful neglect by Customer, the Company will repair or replace such equipment and may bill the Customer for the costs incurred. 6. WATER USAGE LIMITATIONS: (a) Outdoor water usage by permanent residents between May 1, and September 30, shall not be allowed from noon Friday until noon Sunday and on holidays. There will be no outside irrigating from dusk to dawn by any customer during the above period. (b) The Company may further restrict the outdoor use of water by any or all Customers in times of water shortage. (c) The determination to impose such restrictions shall be at the discretion of Company. These may restrict days of use, time of use or prohibit such use totally. Written notice of such restrictions shall be delivered to the Customer by mail or by physical delivery to the Customers residence or point of use. Violation of such restrictions after said notice may be considered a dangerous condition allowing discontinuance of service without further advance notice. 7. RESPONSIBILITY: (a) The Company will install, own, operate, maintain and replace all equipment and water meters on the main water transmission lines. Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

7 Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #5 (b) Customer must obtain and furnish to the Company all necessary permits to enable the Company to supply service, except permits for public space which will be obtained by Company. of water upon the premises of Customer is at the risk of Customer, of connection with Customer s (c) The use and the responsibility of Company shall cease at the point service. (d) Customer shall be responsible for the installation and maintenance piping, plumbing and equipment on Customer s premises connected or will be connected to Company s distribution system. Company shall not be liable for any loss or damage of any nature whatsoever caused by any defect in Customer s service piping or in Customer s equipment upon the premises the duty of inspecting Customer s piping, plumbing, and equipment and shall not be responsible therefor. of all of Customer. The Company does not assume (e) Customer shall be responsible for installing a lock on all outside water hydrants belonging to Customer. (f) The Company does not undertake or agree to furnish or supply continuous or uninterrupted service to its Customer s and shall not be held responsible or liable to any Customer for any loss or damage caused or occasioned by or arising from any interruption or delay in service, or from any failure to supply water occasioned by or due to, accidents, breakdowns, washouts, acts or beyond the reasonable control of the Company, or on account civil or military authority: nor in any event shall the Company be responsible or liable for any consequential damages, unless occasioned by Company s willful default or neglect. of nature or other causes which are unavoidable of strikes, riots, wars, or (g) The Company will not permit any physical connection between a private water supply and Company s distribution system. (h) The Customer shall, when requested by the Company or when required by legally constituted authority, furnish, own, and install a back flow prevention device in Customer s piping or plumbing. Said device shall be of a type acceptable to Company and shall be installed, tested from time to time, and maintained by or at Customer s expense in accordance with Company s requirements. 8. WATER EXTENSION RULES: Extension of mains will be made by the Company, where grades of streets, avenues, etc., have been established by law, along streets dedicated to public use, county roads, highways, or upon other satisfactory rightsof-way: provided in all cases of extensions, that pressure conditions permit service to the desired location, that sanitary conditions do not render the extension inadvisable, and that the Company has sufficient water developed to provide for the additional demands without serious detriment to those already being served, and that the following provisions shall apply: Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

8 Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #6 (a) GENERAL EXTENSIONS: Extensions of the water distribution system exclusive of meters and meter installation, costing not in excess of four times the estimated annual revenue immediately available from the Customers to be served, will be deemed Free Extensions and will be made without cost to such new Customers. (Estimated annual revenue as used herein means the average revenue per Customer for the preceding year for the applicable class of service multiplied by the number of Customers desiring to be connected to the new extension.) When an extension is required which costs in excess of the Free Extension limit, the prospective Customers may be required to advance the amount of such excess costs to the Company prior to the beginning of construction. Any money advanced with the Company will be regarded as Customer Advance and, under certain conditions as hereinafter set forth, all or part hereof may be subject to refund. No interest will be allowed on refunds of Customer Advance. Refunds will be made to the Customer or to his assignee when such assignment is on file with the Company. Each additional new Customer desiring to be connected to an extension within a period of sixty (60) months from the date of completion thereof will be required to make an advance, and the previous Customers will receive refunds, in an amount determined as follows: 1. Reduce the amount of the original advance by 1/60 of said amount multiplied by the number of months which have elapsed since the completion of the extension to determine the presently effective advance. 2. Reduce the presently effective advance determined in Item 1 by the amount of Free Extension for the new Customer, (i.e. four times the annual revenue) and divide the balance by the revised number of Customers to be served by said extension. The amount so determined shall be advanced by the new Customer 3. Refund pro-rate to each Customer, other than the new Customer, the total of the Free Extension for the new Customer and the amount advanced by the new Customer. Adjustments will be made when the actual cost of the extension is found to be less than the estimated cost. (b) MISCELLANEOUS PROVISIONS APPLICABLE TO ALL EXTENSIONS: 1. That part of the cost of increasing the capacity of existing mains and facilities which is made necessary in order to serve the new Customers may be considered a part of the extension but only that portion of the cost that shall be necessary for or applicable to the extension under consideration, shall be included. Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

9 .. Lake Water Company, LLC Tariff #3 Wheatland, WY Original Sheet #7 2. Extensions may be made across private property only on delivery to the Company of a good and sufficient right-of-way. 3. The size, type and quality of materials and location of the lines and facilities shall be specified by Company and the actual construction will be done by the Company or by a contractor acceptable to it. Adjustments of advance payments will be made only where the actual cost is found to be less than the estimated cost. 4. Sole and exclusive title to any extension constructed under these rules shall be vested in the Company. 5. The service pipe from the water main shall be installed by or at the expense of Customer and the costs thereof will not be included in the cost of the extension. 6. All facilities beyond the point of connections shall be furnished, installed, owned and maintained by the Customer. 7. Any extension of the Company s water mains shall be considered as a new and separate extension. 9. P.S.C. WYO RULES, ORDERS AI I) REGULATIONS: The Rules, Orders and Regulations of the Public Service Commission of Wyoming, now in effect or hereafter issued, are by reference hereby made part of this tariff Lake Water Company, LLC Date Issued: August 13, 2010 Date Effective: January 1, 2011

10 . 0. LAKE WATER COMPANY, LLC A WYOMING LIMITED LIABILITY COMPANY P0B0X453 WHEATLAND, WY Rate Increase Discussion Lake Water Company, LLC is owned and operated by Bill Birkie. He has owned the company since January 1, The last rate increase was received in January of At that time, the rate allowed for a 12.00% return on investment. However, since that increase, the cost of service to the customers of Lake Water Company has also increased. Wheatland Rural Electric Association which supplies the electricity to run the pumps for Lake Water Company has had five rate increases (one in 2006, 2007, 2008, 2009, and 2010) since Lake Water s last rate increase. Below is a chart showing gallons of water pumped, kilowatts used, electric cost, and pumping cost per 1000 gis. for all of 2006, 2007, 2008 and 2009 and the first 6 months of 2010: Year Gal water Kilowatts Electric Pumping cost/i 000 pumped used cost gal $ $ $ $ $ $ $ $ /30/ $ s Lake Water Company has also incurred higher vehicle expenses due to large increases in fuel over the last five years since a rate increase. Below is a chart of the increase in the federal mileage allowance over : Year Federal Mileage Allowance 2006 $ $ $0.505 & $0.585 after June 30, $ $0.50 One of the major increases faced by Lake Water Company is for repair costs. The waterlines and equipment are aging and need continual repairs. Lake Water Company has been instructed in order to be in compliance with the DEQ it needs to raise one of its well s head out of the ground. An estimate given on August 15 th was $1,500 to get this completed. Another major repair that needs to be done is cleaning of the water storage

11 . tanks, it is estimated to cost round $4,000. Lake Water Company has replaced some of the line in 2007 due to added funds from their rate increase in However, there are still streets that need line replaced. If a rate increase is granted, Lake Water Company would be able to replace the underground line on Pine Street completely in the coming year and a line between Reservoir Drive and Oak Street. This would curb some future repair costs and also conserve water and electricity because there would be far less waste from leaks. The estimated cost to replace both waterlines is between $13,000 and $15,000 with some labor being done by Bill and some labor, backhoe, track hoe, etc. being hired out. Lake Water Company would also like to put master meters on each well, since metering to the individual taps is far to cost prohibited for this size of a utility. The cost estimate for this is around $2,000. In January 1995, the commission approved a rate of return of 12.00%, Docket No WR-94-5, Lake Water Company has not received that rate of return for several years (see exhibit 1 attached). The first two years after the 2006 rate increase were the only years that Lake Water actually received the rate of return. However, with increased costs they no longer are receiving the rate of return. Based on estimates and annualized cost, Lake Water Company will be far short of reaching a 12.00% return in 2010 (see exhibits 2, 2a, 3, 4, and 5) unless the customer rate is increased to $ per year. Lake Water Company would also like to increase the initial tap fee from $ to $ in order to offset some of the cost of tapping into a deteriorating system. Tapping into the system costs Lake Water Company approximately $ plus five hours of labor by the manager. The costs are as follows: Backhoe Supplies 4 hours at $100/hour $ Stop Boxes $ Line (average 200 ft) $ Misc. supplies $ Total Supplies $ Total Materials & Contract Labor Cost $ Lake Water Company would like to have a reconnect fee of $600 is to deter customers from not paying their water bill, having it disconnected, and then reconnecting it when they decide they need water. Presently, they are only charged the tap fee which is cheaper than paying their water bill for the year. However, if the commission grants Lake Water the increase in tap fee charges, Lake Water would like to only charge $600 for the reconnect instead of $ for a new tap. This reconnection costs Lake Water Company added dollars both by some of the cost listed above and the revenue lost if the client goes a whole year before reconnecting. Lake Water Company currently has 91 customers; there is a possibility for 3 to 4 more customers to tap into the system. The current water system s maximum capacity would be 90 to 95 customers. However, most of the land lots in the Lake Shore Tract

12 . Subdivision have been purchased and will not be requiring a new tap ever because the owners purchased more than one lot or they are on their own well.

13 RATE OF RETURN 0% 9.28% 0.52% 18% 30.91% INCOME MEMBER HEALTH INS TOTAL EXPENSES NET INCOME OR (LOSS) VEHICLE EXPENSE EDUCATION OPERATING FEE TO MEMBER DUES & SUBSCRIPTIONS DEPRECIATION MATERIALS & SUPPLIES MEALS & ENT INSURANCE ADVERTISING. TAXES & LICENSES LEGAL & PROFESSIONAL BANK CHARGES UTILITIES REPAIRS WATER TESTING CONTRACT LABOR TELEPHONE INTEREST OFFICE RENT OFFICE SUPPLIES EXPENSES POSTAGE WATERFEESANDTAP FEES $6, ($10,862.00) $2, $ $6, $6, / /09 12/31/08 12/ /06 ESTIMATED Four Year Comparison STATEMENT OF REVENUE AND EXPENSES LAKE WATER COMPANY EXHIBIT I

14 .. LAKE WATER COMPANY, LLC FORECASTED OPERATING COST - TEST YEAR Exhibit 2 BASED ON 2009 ANNUAL ACTUAL ANNUALIZED ACTUAL ESTIMATE THRU FIGURES EXPENSES OPERATING FEE TO MEMBER ** MEMBER HEALTH INS REPAIRS WATER TESTING MATERIALS & SUPPLIES CONTRACT LABOR ** UTILITIES TELEPHONE INSURANCE ** INTEREST BANK CHARGES OFFICE RENT OFFICE SUPPLIES POSTAGE DUES&SUBSCRIPTIONS LEGAL & PROFESSIONAL ** TAXES & LICENSES ** VEHICLE EXPENSE ** ADVERTISING MEALS &ENT DEPRECIATION * EDUCATION ** TOTAL EXPENSES * based on actual depreciation without capital improvements added before year end ** based on estimated rather than annualized amounts see next page for explanations

15 .. LAKE WATER COMPANY, LLC ADJUSTMENTS TO ANNUALIZED AMOUNTS Exhibit 2a Operating fee to member: $ 15,000 Amount increased to $1250/month. Member is having to travel 90 miles 2 to 3 days per week to repair and maintain old lines and systems, on 24 hr call. 96 hours per month I $1250 = $13.00/hour Contract Labor: Lake Water Company owes contractor for labor already preformed on repairs to the 2500 system but has not paid contractor as of 7/31/1 0. Insurance: As of July 31, 2010 Lake Water Company has paid all insurance cost for the year. $ 778 Legal & Professional: Increase due to rate case expenses incurred by Lake Water Company $ 793 Lake Water Company s normal accounting fee is $ The fee for this rate case is estimated at $ which is amortized over 3 years. 1000/3 = Taxes & Licenses: Lake Water Company has not paid any taxes and license for 2010 but they are due before $ 181 year end. Vehicle Expense: Amount is based on standard mileage rate for federal government of $0.50 $ 7, miles X 3 days X 52 weeks = miles+ 220 miles education in Casper = X $0.50 Education: Lake Water Company does not expect to incur any more education expenses for 2010 $ 975

16 .. LAKE WATER COMPANY, LLC RATE BASE COST ACCUM DEP BOOK VALUE EQUIPMENT WELLS WATERLINES RATE BASE Exhibit 3

17 . EQUIPMENT 01/01/99 SLI7 YEAR LAKE WATER COMPANY, LLC DEPRECIATION SCHEDULE AS OF 12131/10 Exhibit DATE METHOD! ACCUMULATED REMAINING Estimated ASSET DESCRIPTION PURCHASED LIFE COST BASIS DEPRECIATION BASIS Depreciation WATERLINES 01/01/99 SI] 15 YEAR WELLS 01/01/99 SI] 15 YEAR PUMP & PUMP MOTOR 09/11/01 SI] 7 YEAR PUMP & PUMP MOTOR 06/11/04 SI] 7 YEAR PUMP & PUMP MOTOR 06/01/07 SI] 7 YEAR WELL 06/01/07 SL/I5YEAR NEW LINES & 5 HOOKUPS 05/01/07 SI] 15 YEAR COMPUTER 06/01/07 SI]5 YEAR CARGO TRAILER 06/01/07 SI]7 YEAR

18 .. LAKE WATER COMPANY, LLC COST OF SERVICE ANALYSIS - YEAR-END RATE BASE Exhibit 5 RATE BASE $26, RETURN UNDER EXISTING RATES REVENUE $35, OPERATION AND MAINTENANCE 41, DEPRECIATION EXPENSE 4, TAXES AND LICENSES TOTAL OPERATING EXPENSE $45, RETURN UNDER EXISTING RATES ($10,006.00) RATE OF RETURN EXISTING RATES 0 RETURN UNDER PROPOSED RATES REVENUE $54, OPERATION AND MAINTENANCE 41, DEPRECIATION 4, TAXES AND LICENSES TOTAL OPERATING EXPENSE $46, RETURN $8, RATE OF RETURN PROPOSED RATES 31.66% COST OF SERVICE RATE OF RETURN 31.66% RETURN $8, OPERATION AND MAINTENANCE 41, DEPRECIATION 4, TAXES AND LICENSES TOTAL COST OF SERVICE $54, REVENUE UNDER EXISTING RATES $35, REVENUE DEFICIENCY AMOUNTS ($18,655.00) PERCENT % $ /91 customers = $ $600.00! 12 months = $50.00 If rate increase is granted, Lake Water s expenses would be higher than estimated because there are many repairs and maintenance items that need to be done, that have not been done in past because of lack of funds. See Rate Increase Discussion.