PUBLIC SERVICE COMMISSION. Entered: September 24, 2004

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1 ~ --w Q!k?im--4,'"* _.-- PUBLC SERVCE COMMSSON =% OF WEST VRGNA C HAFtLE S TON Entered: September 24, alj wpd \! 'l!.. COWEN PUBLC SERVCE DSTRCT Rule 19A application to increase water and sewer rates and charges. CASE NO PSWD-19A RECOMMENDED DECSON 1 1 On February 11, 2004, Cowen Public Service District (District or Applicant) filed an application, pursuant to Rule 19A of the Commission's Rules for the Construction and Filins of Tariffs (Tariff Rules), requesting an increase in its water and sewer rates and charges for its customers in Webster County, West Virginia, and requesting approval of a $50.00 security deposit for its sewer customers. On March 3, 2004, C. Terry Owen, Staff Attorney, filed an nitial Joint Staff Memorandum. According to Staff, the District seeks to raise its water rates by 7% and its sewer rates by 12%. Staff reminded the Applicant of its responsibilities under Rules 8.2.f. and 8.2.i. of the Commission's Tariff Rules and to file Tariff Forms 6-A and 6-B. On March 16, 2004, the Commission issued a Referral Order, referring this proceeding to the Division of Administrative Law Judges for a decision to be rendered on or before October 8, t was further ordered that Commission Staff file its report with the Commission on or before May 21, On June 9, 2004, Commission Staff filed 19A Exhibits in this proceeding. Based on the District's going-level revenue requirements, Staff recommended an across-the-board increase of 8.9% to the District's current water rates and charges and an across-the-board increase of 3.7% to the District's current sewer rates and charges. By Order entered on June 25, 2004, the District was directed to comply with the notice requirements in Tariff Rules 8.2.f. and 8.2.i., and file the required Tariff Forms No. 6-A and 6-B, verifying such compliance, on or before July 23, 2004, or this case would be dismissed. On July 22, 2004, the District filed an affidavit verifying compliance with the publication requirement. The last publication occurred on July 14, 2004, and the protest period expired on July 26, As of the date of this Order, no protests have been filed. However, Tariff Form Nos. 6-A and 6-B were not filed by the District. PUBLC SE COMMSSON OF WEST VRGNA CHARLESTON

2 By Procedural Order entered on August 31, 2004, the District was directed to show cause why this case should not be dismissed for failure to file Tariff Form Nos. 6-A and 6-B. On September 2, 2004, the District filed Tariff Form No. 6-B and, on September 10, 2004, the District filed Tariff Form No. 6-A. On September 13, 2004, a single letter of protest was filed. FNDNGS OF FACT 1. The District's current water rates provide a going-level remaining cash deficit of $21,157, with a debt service coverage of 75.28%. The Staff-recommended rates and charges provide for a $4,018 cash surplus, with a debt service coverage factor of %. (See, Staff Report filed June 9, 2004). 2. The District's current sewer rates provide a going-level remaining cash deficit of $3,672. The Staff-recommended rates and charges provide a $2,688 cash surplus, with a debt service coverage factor of %. (See, Staff Report filed June 9, 2004). 3. Only one letter of protest was received in response to the publication of the Staff-recommended increased water and sewer rates and charges. This Administrative Law Judge finds that one letter of protest out of 760 customers is not sufficient protest to generate a hearing. (See, case file generally). - Since publication was made of the Staff-recommended increased rates and charges and only one protest was filed in response thereto, it is reasonable to finally approve the Staff-recommended increased rates and charges as stated in the Order Requiring Publication issued on June 25, 2004, because they are reasonable and sufficient, but not more than sufficient, to support the District's reasonable operation and maintenance expenses, capital additions and debt service requirements. ORDER SEWER OPERATONS APPLCABLTY Applicable within the entire territory served. C T S, THEREFORE, ORDERED that the Staff-recommended increased water and sewer rates and charges for Cowen Public Service District be, and the same hereby are, finally approved to become effective for all service rendered to its water and sewer customers on and after the date that this Recommended Decision becomes a Final Order of the Commission. The approved rates are as follows: AVALABLTY Available for general domestic, commercial and industrial service. PUBLC SE COMMSSON -2- OF WEST VlRQlNlA CHARLESTON

3 RATES (customers with metered water supply) First 2,000 gals. used/modth Next 10,000 gals. used/month Over 12,000 gals. used/month $5.29 per 1,000 gallons $5.10 per 1,000 gallons $4.88 per 1,000 gallons MNMUM CHARGE No bill will be rendered for less than $10.58 per month, which is the equivalent of 2,000 gallons. DELAYED PAYMENT PENALTY The above schedule is net. On all accounts not paid in full when due, ten percent will be added to the net current amount unpaid. This delayed payment penalty is not interest and is to be collected only once for each bill where it is appropriate. TAP FEE The following charge is Fo be made whenever the utility installs a new tap to serve an applicant. A tap fee of $ will be charged to customers applying for service outside of a certificate proceeding before the Commission for each new tap to the system. RETURNED CHECK CHARGE A service charge equal to the actual bank fee assessed to the sewer utility up to a maximum of $25.00 will be imposed upon any customer whose check for payment of charges i s returned by the bank due to insufficient funds. LEAK ADJUSTMENT $0.38 per 1,000 gallons f water is to be used when a bill reflects unusual water consumption which 7 can be attributed to eligible water leakage on customer's side of the meter. This rate shall be applied to all such consumption above the customer's historical average usage. SURCHARGE FORMULA TO BE APPLED N CASES WHERE SURFACE DRANAGE S CONNECTED TO THE DSTRCT'S SANTARY SYSTEM APPLCABLTY Whenever the District had discovered that a customer's roof drain, downspout, storm sewer or similar facility conducting surface water has been connected to the District's sewer system and such a customer has failed to take appropriate action within thirty (30) days of receipt of a demand by the District in accordance with the Rules and Regulations of the Public Service Commission to eliminate such connection, a surcharge will be imposed upon the customer calculated on the basis of the following formula: S - A x R x x C S - The surcharge in dollars. A - The area under roof and/or the area of any other water collecting surface connected to the sanitary sewer in square feet. R - The measured monthly rainfall in inches. OF WEST VRGNA COMMSSON -3-._ ~ <&

4 = A conversion factor to change inches of rain x square feet of surface to thousands of gallons of water. C - The District s approved rate per thousand gallons of metered water usage. The District shall not pmpose the surcharge unless and until the customer has been notified by certified mail, return receipt requested, or by hand delivery, that it has been established by smoke testing, dye testing, or on-site inspection that rain or surface water is being introduced into the sanitary sewer system at the customer s location, and that the customer has not acded within thirty (30) days from receipt of such notice to divert the wader from the sanitary sewer system. Said surcharge shall be calculated and imposed for each month the conditions continues to exist. Failure to pay the surcharge and/or correct the situation shall give rise to the possible termination of water service in accordance with the Rules and Regulations of the Public Service Commission of West Virginia. WATER OPERATONS APPLCABLTY Applicable within the enpire territory served. AVALABLTY Available for general domestic, commercial, industrial and sale for resale water service. RATES (customers with metered1 water supply) First 2,000 gals. used/month Next 10,000 gals. used/mon;th Over 12,000 gals. used/mon;th $4.63 per 1,000 gallons $3.94 per 1,000 gallons $3.54 per 1,000 gallons MNMUM CHARGE No bill will be rendered for less than $9.26 per month, which is the equivalent of 2,000 gallons. 5/8 inch meter 3/4 inch meter 1 inch meter 1 1/2 inch meter 2 inch meter 3 inch meter 4 inch meter 6 inch meter $ 9.26 per month $ per month $ per month $ per month $ per month $ per month $ per month $ per month WATER SALES FOR RESALE All water for resale to Bolair Public Service District will be billed in accordance with the approved rate of $2.46 per 1,000 gallons used per month. i OF WEST VRGNA CHA.RLESTON COMMSSON -4-

5 DELAYED PAYMENT PENALTY The above schedule is net. On all accounts not paid in full when due, ten percent will be added to the net current amount unpaid. This delayed payment penalty is not interest and is to be collected only once for each bill where it is appropriate. RECONNECTON $20.00 To be charged when the supply of water is turned off for violations of rules, non-payment of billls or fraudulent use of water. TAP FEE The following charge is to be made whenever the utility installs a new tap to serve an applicant,. A tap fee of $ will be charged to customers applying for service outside of a certificate proceeding before the Commission for each new tap to the system. RETURNED CHECK CHARGE A service charge equal to the actual bank fee assessed to the District up to a maximum of l$25.00 will be imposed upon any customer whose check for payment of charges is returned by their bank due to insufficient funds. LEAK ADJUSTMENT $0.28 per 1,000 gallons of water is to be used when a bill reflects unusual water consumption which can be attributed to eligible water leakage on customer's side ofi the meter. This rate shall be applied to all such consumption above the customer's historical average usage. T S FURTHER ORDERED tha't the District's purchase of a new backhoe, pressure jet and repairs to the sewer lab building be, and hereby is, approved, as recommended by Commission Staff. T S FURTHER ORDERED thap the District implement the approved $1.00 per hour, per employee, pay raise within thirty (30) days following the date that this Order becomes final. T S FURTHER ORDERED that the District's sick leave policy be amended to reflect either (1) lsick leave days must be on a "use or lose" basis or (2) the Board may allow the employees to carry over any unused days to the succeeding year with or without a maximum number of days to be carried over each year. T S FURTHER ORDERED that the District's request to borrow $75,000, at an interest rate of 6.9% for a period of four (4) years, be, and hereby is, approved, provided the District closes on the loan within thirty (30) days of the date that this Order becomes final. T S FURTHER ORDERED 'that the District establish a separate checking account for its water operations, a separate checking account for its sewer operations, a lseparate checking account for its water security deposits and a separate checking account for its sewer security deposits.,of WEST VRGNA CHARLESTON COMMSSON -5-

6 T S FURTHER ORDERED that the District's Board operate in compliance with the Commission's rules and regulations regarding T S FURTHER ORDERED that Cowen Public Service District file with the Commission's Tariff Offi'ce an original and no less than five (5) copies of a proper tariff rdflecting the rates approved herein within thirty (30) days of the dade that this Recommended Decision becomes final. The Executive Secretary is hereby ordered to serve a copy of this order upon the Commission by hand delivery, and upon all parties of record by United States Certyfied Mail, return receipt requested. Leave is hereby granted to the parties to file written exceptions supported by a brief with the Executive Secretary of the Commission within fifteen (15) days of the date this order is mailed. f exceptions are filed, the parties filing exceptions shall certify to the Executive Secretary that all parties oq record have been served said exceptions. f no exceptions are so filed this order shall become the order of the Commission, without further action or order, five (5) days following the expiration of the aforesaid fifteen (15) day time period, unless it is ordered stayed or postponed by the Commission. Any party may request w4iver of the right to file exceptions to an Administrative Law Judge's Order by filing an appropriate petition in writing with the Secretary. No such waiver will be effective until approved by order of the Commission, nor shall any such waiver operate to make any Administrative Law Judge's Order or Decision the order of the Commission sooner than five (5) days after approval of such waiver by the Commission. MCC:jas ab.wpd 13.4 w-& Miles C. Cary Administrative Law hdge OF WEST VRGNA COMMSSON -6-