Residential Utility Consumer OfficePima Utility Company - 2011 Rate Case
Docket Numbers: W-02199A-11-0329 and SW-02199A-11-0330
On Monday, August 29, 2011, Pima Utility Company ("Pima" or "Company") filed applications requesting permanent rate increases for its Water and Wastewater Divisions with the Arizona Corporation Commission ("ACC" or "Commission"). The Company provides service to customers living in the community of Sun Lakes.
According to the Company's applications, Pima is seeking revenue increases of $1,023,565, or 51.76, percent for the Company's Water Division and $691,210, or 22.32 percent, for the Company's Wastewater Division.
Under Pima's proposed rates, a residential water customer, using a 5/8 x 3/4-inch meter with an average consumption of 6,359 gallons, would see his or her bill increase $3.83, or 35.91 percent, from $10.66 to $14.49. A typical wastewater customer, using a 5/8 x 3/4-inch meter, would see a billing increase of $5.06, or 22.25 percent, from $22.73 to $27.79.
During the test year ended December 31, 2010, Pima served approximately 10,175 water connections and 10,051 wastewater connections. The Company stated that Pima’s customer base is comprised of approximately 96.00 percent residential customers, with only 196 commercial customers and 4 irrigation customers. Nearly all of the residential customers are served by 5/8 x 3/4-inch meters. Commercial customers are served by meters ranging from 5/8 x 3/4-inch to 2-inch in size.
In addition to the proposed rate increase, Pima is requesting that the Commission allow it to collect income tax expense despite the fact that the Company has chosen to be organized as a subchapter S corporation that, as a corporate entity, does not pay income taxes (taxes are passed through to shareholders who pay their proportionate share of taxes based on their individual tax situation).
On Monday, September 19, 2011, Pima filed a request to consolidate both applications.
On Thursday, September 29, 2011, ACC Staff issued letters of sufficiency informing Pima that the Company's applications met the requirements of Arizona Administrative Code R14-2-103.
On Friday, September 30, 2011, the Administrative Law Judge ("ALJ") assigned to the case issued a Procedural Order that grated the Company's request to consolidate the two applications and scheduled the evidentiary hearing on the matter for 10:00 a.m. on Tuesday, May 29, 2012. A pre-hearing conference will be held at 2:00 p.m. on Thursday, May 24, 2012.
On Tuesday, December 20, 2011 RUCO filed a request to intervene in the case.
On Monday, January 9, 2012, the ALJ assigned to the case issued a Procedural Order granting RUCO's request for intervention.
Pursuant to the Procedural Order issued on September 30, 2011, RUCO filed its direct testimony on Tuesday, March 27, 2012. Also on Tuesday, March 27, 2012, ACC Staff filed a motion that requested an extension to file its direct testimony. ACC Staff's motion also proposed a revised schedule for filing remaining written testimony.
RUCO is recommending a 28.62 percent increase in revenue for Pima's Water Division, which is just over fifty-five percent of what the Company requested in its application with the ACC. For Pima's Wastewater Division, RUCO is recommending a 7.50 percent increase in revenue or approximately thirty-four percent of the amount of increase requested by the Company.
Under RUCO's recommended water rates, a typical Pima ratepayer with a 5/8 x 3/4-inch meter, and an average monthly consumption of 6,395 gallons, would see a bill increase of $2.11, or 19.79 percent, from $10.66 to $12.77. A typical 5/8 x 3/4-inch meter wastewater customer would see his or her monthly bill increase by $1.03, or 4.53 percent, from $22.73 to $23.76. RUCO is also recommending a 9.57 percent increase in Pima's irrigation rate as opposed to the Company-proposed 29.17 percent increase.
On Wednesday, March 28, 2012, the ALJ assigned to the case issued a Procedural Order that granted ACC Staffs' request for an extension to file its direct testimony. The ALJ also revised the filing schedule for all remaining written testimony.
On Thursday, March 29, 2012, RUCO filed a notice of errata correcting information contained in the direct testimony of RUCO witnesses William A. Rigsby and Timothy J. Coley.
On Tuesday, April 3, 2012, RUCO filed a notice of errata correcting information contained in the direct testimony of RUCO witness Robert B. Mease.
On Tuesday, April 3, 2012, ACC Staff filed its direct testimony.
Pursuant to the revised filing schedule, Company rebuttal testimony will now be due by noon on Friday, April 27, 2012.
Surrebuttal testimony from ACC Staff, RUCO and other intervenors is now due by 4:00 p.m. on Friday, May 18, 2012.
A final round of rejoinder testimony from the Company will now be filed by noon on Thursday, May 24, 2012.
After the conclusion of the evidentiary hearing and the filing of legal briefs, the ALJ will weigh all of the evidence presented in the case and write a Recommended Opinion and Order ("ROO"). The ROO will then be voted on by the five sitting ACC Commissioners during a noticed Open Meeting. The Commissioners can either accept, reject or amend the ROO.
A final decision by the Commission on Pima's requested increase is not expected until sometime during the latter part of the third quarter of 2012.