NOTICES
PENNSYLVANIA PUBLIC
UTILITY COMMISSION
Implementation of Section 1329 of the Public Utility Code
[49 Pa.B. 1259]
[Saturday, March 16, 2019]Public Meeting held
February 28, 2019Commissioners Present: Gladys M. Brown, Chairperson; David W. Sweet, Vice Chairperson; Norman J. Kennard; Andrew G. Place; John F. Coleman, Jr.
Implementation of Section 1329 of the Public Utility Code; M-2016-2543193
Final Supplemental Implementation Order By the Commission:
On April 14, 2016, Act 12 of 2016 amended Chapter 13 of the Pennsylvania Public Utility Code by adding Section 1329 to become effective June 13, 2016. 66 Pa.C.S. § 1329. On July 21, 2016, the Commission entered its Tentative Implementation Order addressing the implementation of Section 1329 and, subsequently, on October 27, 2016, the Commission entered its Final Implementation Order (FIO) to guide stakeholders in the implementation of Section 1329.
While Section 1329 has encouraged the sale of public water and wastewater assets at market rates, the Commission's experience to date with Section 1329 applications indicates that our procedures and guidelines can be improved. Namely, the Commission issues this Order to improve the quality of valuations, ensure that the adjudication process is both fair and efficient, and, ultimately, reduce litigation surrounding Section 1329 determinations.
Aside from fundamental stakeholder disagreement over appropriate utility valuation principles, there are difficulties related to the six-month consideration period available to applicants under 66 Pa.C.S. § 1329(d)(2). That is, the six-month statutory deadline comes at the price of an accelerated litigation schedule. In addition, in some cases, the Commission has observed substantial variances in underlying valuation assumptions related to the same property. Further guidance can provide more consistency in final valuations as well as the testimony submitted in support of valuations. Lastly, to aid fair and efficient Section 1329 review, the initial application should include enough relevant information so that parties can meaningfully participate in the application without causing exhaustive discovery and within the statutory timeline of Section 1329.
Throughout 2018 the Commission conducted stakeholder workshops to informally develop proposed revisions to the standard materials required for Section 1329 applications, guidelines for selling utility valuations, testimony, and procedural guidelines. On September 20, 2018, with the benefit of these workshops and approximately two years of experience applying Section 1329, the Commission issued a Tentative Supplemental Implementation Order (TSIO). The Commission invited interested persons to submit comments and offer recommendations regarding the TSIO within thirty (30) days after publication in the Pennsylvania Bulletin and submit reply comments fifteen (15) days thereafter.
The Commission received comments from Aqua Pennsylvania, Inc. (Aqua), the Bureau of Investigation and Enforcement (BIE), the Chester Water Authority (CWA), Herbert, Rowland and Grubic, Inc. (HRG), the Office of Consumer Advocate (OCA), the Pennsylvania Municipal Authorities Association (PMAA), Pennsylvania-American Water Company (PAWC), SUEZ Water Pennsylvania, Inc. (SWPA), and the York Water Company (York Water). The Commission received reply comments from Aqua, BIE, the OCA, the PMAA, PAWC, and SWPA.11
On January 25, 2018, PAWC filed a Petition for Leave to File Supplemental Comments on the TSIO. PAWC Supplemental Comments proposed a notice procedure and pro forma customer notice documents. On January 28, 2019, via Secretarial Letter, the Commission granted PAWC's Petition and established a reply comment deadline of February 7, 2019. The Commission received reply comments from Aqua, BIE, the OCA, and the PMAA.
Discussion
After considering the TSIO comments, supplemental comments, and reply comments thereto, the Commission now issues this Final Supplemental Implementation Order (FSIO) to improve the Commission's Section 1329 review process. As with the TSIO, the FSIO is organized in sequential order according to the procedural timeline of a Section 1329 application. To the extent that we have not addressed a particular comment, it has been duly considered and is not adopted.
Checklist for Applications Requesting Section 1329 Approval
Subsections 1329(d)(1)(i)—(v) enumerate categories of information that the Buyer22 is obligated to provide as part of a Section 1329 acquisition application. The Commission will not officially accept a Section 1329 application, thus initiating the six-month consideration period of Section 1329(d)(2), until a Buyer has shown that its application is complete. To clarify its expectations of what constitutes a complete application the Commission developed an Application Filing Checklist, which it requires applicants to attach to applications at the time of filing.
The TSIO proposed revisions to the Application Filing Checklist in its Appendix A. General changes included formatting for ease of future edits and sequencing checklist items to reflect the chronology in which checklist items may be complied. Checklist instructions also clarify that an individual document may be used to satisfy more than one checklist item so long as appropriate cross-references are used to direct attention to exactly where the required information may be found in the filing. The general instructions further provided that service of an accepted filing on affected political subdivisions may be accomplished electronically if the recipient can accept electronic service. We directed stakeholders to review the entire proposed revised Checklist, including specific revisions to Items 2—4, 7—10, 13, 14, 17—20, 22, and 25. We requested comments on whether the Checklist was too broad, is complete, or should be expanded to include additional items.
Below we first address comments and reply comments on the proposed revised Application Filing Checklist in its entirety. We then address comments and reply comments regarding specific revisions to the Items identified in the TSIO. The parties generally do not oppose revisions to Items 2, 3, 7, 10, 17, 19, 22, and 25. Accordingly, these revisions remain intact and we will not address them further. A copy of the final Application Filing Checklist is attached hereto as Appendix A.
Comments
As to the entire Checklist, the OCA suggested that page numbers should be filled in on the Checklist included with a filing. OCA Comments at 4. In addition, the OCA suggested the use of Bates stamping for all pages in a filing. Id. The OCA opined that Bates stamping would allow all parties to be able to reference specific pages and sections of the filing in a consistent way. Id.
SWPA recommended that the Commission create a modified checklist and an expedited process based on the size of the purchased system. SWPA Comments at 2. In particular, SWPA recommended a ''short form'' checklist for systems with less than 1,000 customers or a purchase price of less than $10 million. Id. SWPA opined that it is unreasonable to require the same extensive information for a small acquisition that is required of a large acquisition. Id. SWPA further suggested that the modified checklist should be used if the average of the two independent valuations are within ten percent of each other and the purchase price is within ten percent of the purchasing company's investment per customer. Id.
Similarly, York Water argued that the Checklist is onerous with many of the items regarding costs, values, and environmental issues being either unnecessary or redundant. York Water Comments at 1. York Water suggested the use of a materiality threshold where acquisitions falling below the threshold would have a streamlined approval process. Id. York Water recommended that the threshold be established on a ''cost/customers'' basis or an overall cost not to exceed a certain amount, such as $5 million. Id.
Reply Comments
Aqua opposed the OCA's suggestion to use Bates stamping. Aqua Reply at 3. Aqua argued that the applications filed to date have provided clear, sufficient numbering of exhibits to allow parties to reference information in the filing. Id. Aqua also noted that large, multi-exhibit filings, such as rate cases, do not require Bates stamping. Id.
PAWC also opposed the use of Bates stamping. PAWC Reply Comments at 7. PAWC noted that its applications are divided into exhibits that match the items on the Checklist. Id. PAWC argued that the OCA failed to consider that Bates stamping could only be done once the application is completed and, once Bates stamping is done, it would be difficult to insert a page at the last minute, if need be. Id.
Conversely, BIE supported the use of Bates stamping for purposes of organization and efficiency due to the size of the filings. BIE Reply Comments at 2. BIE noted that some Section 1329 applications have consisted of 1,400 pages. Id.
In response to SWPA and York Water's concerns regarding the length of the Checklist, BIE pointed out that, by filing the information sought in the Checklist, the discovery exchange after an application is transferred to the Office of Administrative Law Judge (OALJ) would be lessened. Id. at 3. BIE noted that, due to the six-month deadline, it is imperative that the parties and the Administrative Law Judge (ALJ) have as much information as possible from the outset of the proceeding in order to provide the Commission with a full and complete record. Id.
The OCA rejected SWPA's proposed modified checklist and York Water's proposed materiality threshold. OCA Reply Comments at 2. The OCA argued that the use of a cost per customer basis to determine level of review in SWPA's proposal may not be a reliable indicator. Id. The OCA also argued that some applications that might meet the threshold in York Water's proposal may still have a major impact on rate base and rates that would need to be fully examined. Id. With regard to both proposals, the OCA argued that shortening the Checklist will put the Commission's Bureau of Technical Utility Services (TUS) and the parties at a major disadvantage in reviewing applications within the statutory deadline. Id.
PAWC, on the other hand, agreed with SWPA's proposal to create a modified checklist. PAWC Reply Comments at 5. PAWC also agreed with York Water that a reduced checklist should be used for small transactions. Id. at 6. PAWC noted that, if additional information is necessary for small transactions, parties may request that information in discovery. Id. at 5-6.
Conclusion
We decline to adopt Bates stamping and note that it is clear that page references are required in the filed checklist. We agree with Aqua and PAWC that applicants have clearly and sufficiently identified exhibits to enable the parties to reference the information contained therein. As PAWC noted, requiring Bates stamping would limit applicants from making additions to the application that may be received only shortly before filing and we encourage the submission of complete applications. Indeed, the 10-day TUS review of Section 1329 applications often results in amendments to applications. In addition, Bates stamping may hinder any potential need to amend an application, if additional information is obtained after filing. Therefore, we decline to revise the Checklist to require Bates stamping.
We also reject the proposals of SWPA and York to create a modified checklist or establish a materiality threshold for small transactions. We note that the General Assembly did not choose to include such a threshold. We agree with BIE regarding the importance of providing the parties and the ALJ with as much information as possible at the outset of the proceeding in light of the six-month deadline. Providing the information required by the Checklist reduces the need for substantial discovery and related disputes and supports the development of a full and complete record, even required for smaller transactions. Moreover, as the OCA noted, the thresholds proposed by SWPA and York may not be appropriate indicators and we decline to distinguish between what is a small transaction and a large transaction at this time.
Checklist Item 4
In the TSIO, we proposed to revise Item 4 of the Section 1329 Application Filing Checklist as follows:
4. Provide responses to Section 1329 Application Standard Data Requests.TSIO Appendix A at 1. The purpose of this revision was to address the responses to the Standard Data Requests.
Comments
Aqua indicated that it does not oppose Item 4 as revised. Aqua Comments at 5. Aqua requested that the Commission make clear that rejection or acceptance of an application does not hinge on a substantive review of the Standard Data Requests. Id.
The OCA noted that existing Item 4 requires an applicant to provide its schedules, studies, and workpapers in electronic working format. OCA Comments at 7. The OCA indicated that it disagrees with the Commission's decision to revise Item 4 as set forth in the TSIO. Id. The OCA argued that electronic working documents are a crucial component of the existing Checklist, because the information included in the electronic working documents is necessary to understand the analyses contained in the filing. Id. at 7-8. The OCA further argued that the Standard Data Requests should supplement the information being provided with the filing, not replace the provision of electronic working documents. Id. at 4, 8.
Reply Comments
In response to the OCA's comments regarding existing Item 4, PAWC noted its concern that materials filed with the Commission are placed on the Commission's website. PAWC Reply Comments at 8. PAWC argued that the formulas and other calculations embedded in spreadsheets and other working electronic files are confidential, proprietary information. Id. PAWC requests that, if existing Item 4 is retained, the Commission direct the Secretary's Bureau not to place working electronic files on the Commission's website. Id.
Conclusion
As it pertains to Aqua's request for clarification that rejection or acceptance of an application does not hinge on a substantive review of the Standard Data Requests, we note the following language in the TSIO:
The Commission would clarify here that the Bureau of Technical Utility Services does not review the veracity or substantive quality of information that an applicant may submit to fulfill the threshold requirements of the Application Checklist. The Bureau of Technical Utility Services is to evaluate only whether the Application Checklist is complete and responsive to the data requested. It shall not refuse to perfect an application on the basis that the Bureau is dissatisfied with the quality of the items submitted in response, or whether additional information may later be required.TSIO at 15. We do not believe that further clarification on this point is necessary.
Upon consideration of the OCA's comments on Item 4 of the Section 1329 Application Filing Checklist, we believe that Item 4 should be modified as follows:
4. Provide responses to Section 1329 Application Standard Data Requests, including electronic working documents (i.e., Excel spreadsheets) for all the filing's schedules, studies, and working papers to the extent practicable.See Appendix A at 1. This revision addresses responses to the Standard Data Requests and maintains the existing requirement that applicants provide electronic working documents for all the filing's schedules, studies, and working papers, while avoiding unnecessary duplication as between the Checklist and the Standard Data Requests.
To alleviate PAWC's concerns regarding the potential confidential nature of electronic working documents, applicants should provide any confidential or proprietary electronic working documents (i.e., Excel spreadsheets) to the Secretary's Bureau on a separate disc, labeled CONFIDENTIAL in clear and conspicuous letters, in a separate envelope attached to the application. It is the applicant's responsibility to identify all confidential or proprietary documents. Applicants providing confidential or proprietary electronic working documents in response to Item 4 should also follow standard procedures for the filing of documents containing confidential or proprietary information with the Commission. Applicants may refer to the instructions for submitting confidential information provided in the Section 1329 Application Filing Checklist. See Appendix A at 7. Further, consistent with the Commission's regulations at 52 Pa. Code § 1.32(b)(4), filings containing confidential or proprietary information may not be filed electronically and the Commission will post only redacted, public versions on the electronic filing system. Likewise, the Commission will post only non-confidential and non-proprietary PDF versions of Excel files on the electronic filing system.
Checklist Item 8
In the TSIO, we proposed to revise Item 8 of the Section 1329 Application Filing Checklist as follows:
8. Provide a verification statement that one utility valuation expert was selected by the buyer and the other utility valuation expert was selected by the seller.TSIO Appendix A at 1. The purpose of this revision was to verify UVE independence. In the TSIO, we noted that Item 8 was addressed to the Buyer and Seller regarding the UVE selection process and that Item 8 is distinct from Item 9, which is addressed to the respective UVEs.
Comments
Aqua stated that it does not oppose Item 8 as revised. Aqua Comments at 5. Aqua requested clarification that this statement may be made in the application verified by an officer or authorized employee of the Company. Id. Aqua noted that, in its previous Section 1329 applications, the Company has included verifications from the UVEs stating that each was selected by either the Buyer or the Seller. Id.
Reply Comments
No party filed reply comments specifically addressing Aqua's request.
Conclusion
As stated in the TSIO and above, Item 8 is addressed to the Buyer and Seller regarding the UVE selection process. TSIO at 10. Accordingly, the applicant should provide a verification statement of the Buyer that one utility valuation expert was selected by the Buyer as well as a verification statement of the Seller that the other utility valuation expert was selected by the Seller. For clarification purposes, we believe it is appropriate to modify Item 8 as follows:
8. Buyer and Seller Verification Statements:a. Provide a verification statement of the Buyer that [one] its utility valuation expert was selected by the Buyer. [and]b. Provide a verification statement of the Seller that [the other] its utility valuation expert was selected by the Seller.See Appendix A at 1. These verification statements may be signed by an officer or authorized employee of the Buyer and Seller respectively.
Checklist Item 9
In the TSIO, we proposed to revise Item 9 of the Section 1329 Application Filing Checklist as follows:
9. Utility Valuation Expert Verification Statements:a. Buyer Utility Valuation Expert has no affiliation with the buyer or seller.b. Buyer Utility Valuation Expert determined fair market value in compliance with the most recent edition of the Uniform Standards of Professional Appraisal Practice as of the date of the report. employing the cost, market, and income approaches.c. Buyer Utility Valuation Expert applied applicable jurisdictional exceptions to the submitted appraisal.d. Seller Utility Valuation Expert has no affiliation with the buyer or seller.e. Seller Utility Valuation Expert determined fair market value in compliance with the most recent edition of the Uniform Standards of Professional Appraisal Practice as of the date of the report employing the cost, market, and income approaches.f. Seller Utility Valuation Expert applied applicable jurisdictional exceptions to the submitted appraisal.TSIO Appendix A at 2. The purpose of this revision is to verify that the Buyer and Seller UVEs have no affiliation with either the Buyer or the Seller. This revision is also directed at verifying that the fair market valuation was performed in compliance with the most recent edition of the Uniform Standards of Professional Appraisals Practice (USPAP) and that the appropriate jurisdictional exceptions were applied to the submitted appraisal. Moreover, as discussed above, Item 9 is distinct from Item 8. Items 9.a through 9.f are addressed to the respective UVEs. Each UVE is expected to submit a verification supporting their independence and submitted appraisal.
Comments
Aqua stated that it does not oppose Item 9 as revised. Aqua Comments at 5. Aqua requested clarification that the items listed in Item 9 may be incorporated into two overall verifications from the Buyer's and the Seller's respective UVEs, rather than a separate verification statement for each item. Id.
Reply Comments
No party filed reply comments specifically addressing Aqua's request.
Conclusion
We agree with Aqua the items listed in Item 9 may be incorporated into two overall verifications from the Buyer's and the Seller's respective UVEs, rather than a separate verification statement for Item 9.a through 9.f. However, we do not believe that it is necessary to modify the language of Item 9 to reflect this point. Therefore, the revisions to Item 9 set forth in the TSIO remain intact.
Checklist Items 13 and 14
In the TSIO, we proposed to revise Item 13 of the Section 1329 Application Filing Checklist as follows:
13. Provide seller direct testimony supporting the application including seller UVE direct testimony.TSIO Appendix A at 2. This revision indicates that the Seller may provide testimony supporting the transaction, if it so chooses. Unless a Buyer and Seller agree otherwise, a Seller is responsible for its own testimony.
In the TSIO, we proposed to revise Item 14 of the Section 1329 Application Filing Checklist as follows:
14. Provide buyer direct testimony supporting the application, including buyer UVE direct testimony.TSIO Appendix A at 2. This revision indicates that the Buyer is to provide testimony supporting the transaction. Unless the Buyer and Seller agree otherwise, the Buyer will be responsible for its own testimony.
Items 13 and 14 indicate that, if Buyer and Seller wish to submit individual direct testimony in support of the proposed acquisition, all direct testimony must be filed concurrent with the application. The six-month consideration period of Section 1329(d)(2) requires direct testimony to be filed concurrent with the application. In addition, the Seller and Buyer UVE will submit written direct testimony in support of their respective appraisals along with the initial filing.
Comments
Aqua stated that it does not oppose Item 13 as revised. Aqua Comments at 6. Aqua noted that it may choose to file the Seller's direct testimony and the Seller's UVE direct testimony along with its application for administrative ease. Id.
PAWC claimed that the Checklist would require the Seller to provide testimony supporting the transaction and that the Buyer would be submitting the testimony of the Seller in the application. PAWC Comments at 3. PAWC argued that the TSIO does not address whether the procedural and evidentiary issue of whether the Buyer may challenge the testimony of the Seller that must be included in the application. Id. PAWC also argued that, just because the Buyer is submitting the Seller's testimony in its application, that testimony should not become the Buyer's testimony such that the Buyer is denied the right to challenge the testimony. Id. PAWC requested that the Commission clarify that inclusion of Seller testimony with the application does not constitute sponsorship of that testimony by the Buyer. Id. PAWC also raised concerns regarding a hypothetical instance in which the Seller declines to intervene and there is no agreement between the Buyer and Seller for the Buyer to sponsor the Seller's testimony. Id. PAWC requested that, if the Seller declines to intervene and the Buyer declines to sponsor the Seller's testimony, the Commission sua sponte enter the testimony into the evidentiary record provided that it is properly authenticated through a verification or affidavit. Id.
Reply Comments
In response to PAWC's arguments, BIE noted that it understands that filing the Seller's testimony with the application could potentially create an issue if the Buyer wants to challenge the Seller's testimony, being that the Buyer and Seller are two distinct parties to the litigation. BIE Reply Comments at 6. BIE argued, however, that having the Seller's UVE testimony at the outset of the proceeding is essential to ensuring that the parties can fully evaluate the filing. Id. at 6-7. BIE stated that it strongly supports the requirement imposed by the TSIO that all UVE testimony be provided at the time the application is filed. Id. at 6.
The OCA noted that, if the Seller declines to intervene and the Buyer declines to sponsor the Seller's testimony, one solution is to join the Seller as an indispensable party. OCA Reply Comments at 16.
Conclusion
As indicated in the TSIO and above, revisions to Item 13 include the following: Seller to provide testimony supporting transaction, if any. TSIO at 9. Contrary to PAWC's arguments, the Seller is not required to provide direct testimony supporting the transaction. The Seller may choose to omit direct testimony at its own risk. A key purpose of this item is to avoid the submission of Seller direct testimony late in the six-month timeframe, which hampers review by other parties of the Section 1329 application. If the Seller wishes to submit individual direct testimony, however, the Seller must sponsor that testimony absent an agreement with the Buyer to the contrary. As stated in the TSIO, each party must sponsor its individual testimony absent demonstrated agreement otherwise included in the application. TSIO at 10. Likewise, if a Seller chooses to individually sponsor testimony supporting an application the Buyer remains free to challenge the Seller's testimony as it believes appropriate.33
In addition, the Commission clarifies that Buyer and Seller direct testimony supporting the application is distinct from UVE direct testimony. For clarification purposes, we modify Items 13 and 14 as follows:
13. Seller Testimony:a. Provide seller direct testimony supporting the application, if any. [including]b. Provide seller UVE direct testimony.14. Buyer Testimony:a. Provide buyer direct testimony supporting the application. [including]b. Provide buyer UVE direct testimony.See Appendix A at 2. Both the Buyer and the Seller UVEs must provide direct testimony in a format like that discussed below. See supra at 88. As we directed in the TSIO, UVEs must submit written direct testimony in support of any appraisal completed pursuant to Section 1329(a)(5) and submitted in support of a request for fair market valuation for rate setting purposes.
Moreover, in the TSIO, we stated that, absent a showing of extenuating and extraordinary hardship, late-filed direct testimony will not be accepted or considered. Also, a request to submit late-filed direct testimony shall be considered a request to extend the six-month consideration period to provide for appropriate due process. These provisions of the TSIO remain intact.
Further, regarding PAWC's concern that the Seller may decline to intervene without an agreement for the Buyer to sponsor the Seller's testimony, we note that, in each of the approximately eight proceedings initiated under Section 1329 to date, the Seller has petitioned to intervene in the proceeding. We decline to speculate as to hypothetical circumstances. Regarding the OCA's proposed solution, pleadings requesting the joinder of indispensable parties will be considered on a case-by-case basis.
Checklist Item 18
In the TSIO, we proposed to revise Item 18 of the Section 1329 Application Filing Checklist by modifying the following subsection:
18. Rates:. . .d. Provide a copy of the notification sent, or which will be sent, to affected customers describing the filing and the anticipated effect on rates.TSIO Appendix A at 3-4. The purpose of this revision is to make clear that applicants are to provide notice to affected customers contemporaneously with the proposed application, not after closing, such that affected customers receive adequate notice of the proposed transaction and have the opportunity to participate in the proceeding.
As indicated earlier, given the circumstances of the issuance of the TSIO and the increasing complexity of litigation surrounding the implementation of Section 1329, we granted PAWC's Petition for Leave to File Supplemental Comments on the TSIO as to notice and provided for reply comments thereto.
Comments
Aqua stated that it does not agree with Item 18 as revised. Aqua Comments at 7. Aqua claimed that it is unclear from the TSIO whether the Commission proposed notice is to be provided to existing or acquired customers, or both. Id. Aqua noted that it will provide the draft customer letter to the Commission that will be sent to acquired customer upon closing, as it has done with previous applications. Id. at 7-8. Aqua stated that it will provide any notice sent by the municipality to customers only if the municipality sent such notice. Id. at 8. Aqua further noted that it has provided supplemental notice through publication in newspapers of general circulation for acquired customers. Id.
Aqua commented that it does not agree with expanding notice to all customers. Id. Aqua claimed that, if notice is provided by bill insert, some customers may get 30 days' notice, some customers may get less than 30 days' notice, and some customers will not receive notice until weeks or months after the protest period has passed. Id. Aqua also claimed that direct mailing is impractical and is not required unless there is a general rate increase. Id. at 8-9. Aqua argued that, in Section 1329 applications, neither a general rate increase nor an increase in rates is proposed to existing or acquired customers. Id. at 9. Aqua further argued that newspaper notice in a paper of general circulation in the acquired customers' service territory is adequate. Id.
In addition, Aqua averred that Item 18 will add confusion to the proceeding. Id. Aqua claimed that notice to existing customers would be highly speculative as to the effect of the acquisition on rates and that asking the Company to predict its rate design is impractical. Id. at 10. Aqua further claimed that direct notice will add approximately $200,000 per application that would be included in transaction and closing costs. Id.
The OCA suggested the use of a collaborative or working group to address issues such as how to implement notice and how to present the rate impacts and the supporting materials in the filing. OCA Comments at 1-2.
The PMAA commented that timely individualized notice should be provided to all ratepayers of the municipal or authority-owned system subject of the proposed acquisition and all of the acquiring entity's existing ratepayers, regardless of geographic location. PMAA Comments at 3. The PMAA argued that notice published in the Pennsylvania Bulletin or a newspaper of general circulation is not sufficient. Id. The PMAA claimed, citing McCloskey v. Pa. PUC, 195 A.2d 1055 (Pa. Cmwlth. 2018) (New Garden), that an investor-owned utility's water or wastewater acquisition in one part of the Commonwealth may have an effect on the rates of its existing ratepayers in another part of the Commonwealth. Id. The PMAA also argued that the investor-owned entity must provide current and future rates applicable to ratepayers affected by the transaction and that any proposed deferment in rate increases must be clearly stated because it may impact ratepayers at some future date. Id.
PAWC commented that notice to the Seller's customers may present challenges for a Buyer to the extent that customer information is deemed confidential. PAWC Comments at 4. PAWC requested that the Commission address how the Buyer can obtain customer information, if notice to the Seller's customers is required. Id.
In addition, PAWC argued that notice should not be provided until the application is accepted. Id. PAWC argued that a rate case-style bill insert is unworkable because it takes a 30-day billing cycle to notify all customers. Id. at 5. PAWC argued that the alternative of a direct mailer would be extremely costly. Id. PAWC claimed that bill insert or bill message would be the most cost effective, but that this approach would require the Commission to modify the litigation schedule and hearing process, unless the Buyer and Seller agree to a voluntary extension. Id. PAWC suggested a two-track litigation schedule and PAWC argued that the first track should include notice through the Pennsylvania Bulletin, newspaper notice, and direct notice to the statutory advocates, DEP, and surrounding municipalities. Id. PAWC argued that second track should include individual ratepayer notice via bill insert over a 30-day billing cycle and that ratepayers should be afforded an opportunity to submit comments within 14 days of the end of the billing cycle. PAWC argued that the comments should be entered into the evidentiary record with the parties responding on the record. Id. at 6. PAWC claimed that a paper hearing has been deemed to satisfy due process requirements. Id.
Further, PAWC requested that the Commission give guidance on what the notice must say. Id. PAWC argued that, at the time of the acquisition, the rate impact of the acquisition is unknowable and that utilities are limited in the information they can give to customers. Id. at 6. PAWC argued that the notice should state that (1) the Buyer has filed an application, (2) the Buyer had requested to add up to $X to rate base in its next rate case, (3) the increase may impact customers rates in the Buyer's next rate proceeding, but the precise impact is unknown at present, (4) and customers have a right to protest or intervene and will have an opportunity to participate in a future base rate proceeding. Id. at 6-7.
Reply Comments
BIE replied that Item 18(d) aligns with the New Garden decision. BIE Reply Comments at 2. BIE stated that it supports the OCA's proposal to use a collaborative or working group to determine how to implement notice. Id. BIE suggested that questions raised by PAWC, including who is to receive notice, when customers should be notified, and how customers should be notified, should be addressed in a collaborative or working group in order to obtain a resolution that is suitable for all parties. Id. at 3.
The OCA argued, pointing to New Garden, that direct notice to customers is required. OCA Reply Comments at 3. The OCA indicated that it is willing to work with the Commission and stakeholders to develop a notice that provides sufficient information regarding the rate impact on customers of the Section 1329 filing and information on what a customer can do in response to the notice. Id. The OCA claimed that the Commonwealth Court's decision in New Garden addresses the issues raised by Aqua. Id. at 3-4. The OCA claimed that Section 1329, by definition, involves a ratemaking rate base determination and that, in New Garden, the Court found that there are due process issues that need to be addressed by providing customers, existing and acquired, with notice of the filing. Id. at 4.
In response to PAWC's concerns on how the Seller's customers will receive notice, the OCA argued that it is clear that the Seller has access to its own customer information and can work with the Buyer to ensure that notice is provided to those customers. Id. The OCA suggested that this be addressed in the APA. Id. In response to PAWC's claim that notice should not be provided until an application is accepted, the OCA proposed that notice be provided during the 30-day billing cycle leading up to the filing of an application. Id. at 5. The OCA argued that waiting until the application is accepted would mean that litigation would conclude before customers are able to meaningfully participate. Id. at 4-5. Further, the OCA indicated that it does not agree that PAWC's proposed two-track litigation schedule, including the use of a paper hearing, meets the requirements of due process. Id. at 6. The OCA argued that the New Garden Court found that substantial property interests were at stake in Section 1329 proceedings and that direct notice and a meaningful opportunity to be heard was required. Id.
The PMAA argued that New Garden is controlling regarding notice. PMAA Comments at 2. The PMAA indicated that it disagrees with comments that seek to narrow notice or limit notice recipients, including comments suggesting that direct notice would add additional costs or confusion to Section 1329 proceedings. Id. The PMAA reiterated that it believes that New Garden mandates individualized notice to ratepayers of the municipal or authority-owned system and all of the acquiring entity's existing ratepayers. Id. Additionally, the PMAA argued that the rates to be assessed against all of an investor-owned utility's customers and potential customers as a result of an acquisition must be clear. Id.
PAWC argued that Section 1329 Applicants should comply with the requirements of New Garden to reduce the risk that a Commission decision approving a fair-market valuation would be appealed and, possibly, overturned. PAWC Reply Comments at 2. PAWC claimed that Aqua's comments appear inconsistent with New Garden. Id. PAWC continued to suggest a two-track litigation schedule. Id. Additionally, PAWC noted that it does not oppose the OCA's suggestion to use a collaborative or working group to address issues that may remain after the TSIO. Id. at 6. PAWC noted, however, that it opposes the use of such a mechanism to slow down or otherwise impede the use of Section 1329. Id. Further, PAWC noted that it opposes the PMAA's suggestions regarding information on future rate increases. Id. at 14. PAWC argued that such information is speculative. Id.
SWPA indicated that it does not agree with PMAA's assertion that timely individualized notice should be given to all of the acquiring utility's existing ratepayers irrespective of geographic location. SWPA Comments at 2. SWPA stated that it agrees with Aqua and PAWC's comments regarding notice. Id.
PAWC's Supplemental Comments
PAWC suggested that the Commission require Section 1329 applicants to take a two-prong approach to notice. First, PAWC proposes that Acquiring Utilities provide notice of the proposed transaction in a form like that of 52 Pa. Code § 53.45. PAWC Supp. Comments at 2. PAWC proposes that this general notice include information regarding the proposed acquisition and rate base addition. The pro forma customer notice provided with PAWC's Supplemental Comments also discussed ways in which to support or challenge the acquisition and how to access documents filed in support of the application and other additional information. PAWC Supp. Comments, Appendix A. PAWC proposes that affected customers would receive this general notice concurrent with the submission of a Section 1329 application. PAWC Supp. Comments at 2.
Next, PAWC proposes that Acquiring Utilities would prepare a ''Statement of Reasons and Potential Bill Impact,'' which would be referenced in the above customer notice. PAWC Supp. Comments at 2. PAWC opines that this approach is similar to that of Section 1308 general rate proceedings. Id. PAWC proposed that the Statement of Reasons and Potential Bill Impact be included in the Application Filing Checklist and reviewed by TUS. Id. PAWC further proposed that, if TUS finds the Statement of Reasons and Potential Bill Impact deficient, the applicant should have an opportunity to revise it. Id. PAWC included with its Supplemental Comments proposed language in a pro forma Statement of Reasons and Potential Bill Impact and a pro forma customer notice. See PAWC Supp. Comments, Attachments A-B.
PAWC claimed that its approach is consistent with New Garden because it is modeled on 52 Pa. Code § 53.45. PAWC Supp. Comments at 2-3. PAWC also claimed that its approach recognizes that, while the rate base valuation of an acquired system is set through a Section 1329 proceeding, actual rates recognizing that valuation will not be set until a future base rate proceeding. As such, the future rate effect of the valuation is subject to a high degree of speculation at the application stage. Id. at 3. PAWC opined that including a speculative rate increase percentage in the customer notice would be misleading. Id. PAWC suggested that, under its approach, customers who desire additional information would be directed by the customer notice to the Statement of Reasons and Potential Bill Impact, which would be readily available upon contact to the company, as in a base rate case, and would provide a more accurate explanation of the range of potential rate effects that could result from including a Section 1329 valuation in a future base rate case. Id.
Reply Comments
Aqua noted that it filed a petition for allowance of Appeal of the New Garden decision and argued that the Commission should revisit any customer notice requirements that may result from the TSIO should New Garden be overturned or modified. Aqua Supp. Comments at 3. Aqua stated that it generally agrees with PAWC's proposal and does not propose any edits to the proposed documents. Id. at 3-4. Aqua raised concerns regarding the process of notice. Id. at 4. Aqua claimed that, under the conditional acceptances for the Exeter44 and Steelton55 applications, the Commission will fully accept an application and the six-month period will begin after the applicant files a verification for individualized notice and proof of publication for traditional newspaper notification with the Commission. Id. Aqua argued that the conditional acceptance in the Exeter and Steelton Applications will add substantial time outside the application process that was envisioned to be six months. Id.
Aqua argued that direct mailing will add substantial costs to each proposed transaction. Id. Aqua also argued that newspaper notification has generally been provided after an application is accepted. Id. at 5. Aqua claimed that the Commission usually directs the form of newspaper notice in a Secretarial Letter and that it did not see a form of notice provided in the Exeter or Steelton applications. Id. Aqua also claimed that it would not be able to provide a date certain for the deadline to file a complaint in the individualized notice or newspaper notice. Id. Further, Aqua claimed that, the timing of newspaper publication and obtaining affidavits will add upward of four weeks to the process. Id. Similarly, Aqua averred that a bill stuffer sent out during the utility's billing cycle will add upwards of four or more weeks, if the Commission requires that the entire billing cycle run before verification can be filed. Id.
Aqua requested that the Commission consider fully accepting an application under a direct mailing approach when the Company files a verification that the direct mailing has occurred, then direct newspaper publication. Id. Aqua argued that it would then be able to provide a certain date for when complaints should be filed. Id. at 5-6. Under a bill stuffer approach, Aqua requested that the Commission consider fully accepting an application when the utility files a verification that it has begun providing bill inserts under its billing cycle, then direct newspaper publication. Id. at 6. Lastly, with regard to the Exeter and Steelton applications, Aqua requested that the Commission clarify the phrase ''area involved'' in the Secretarial Letters for a utility providing notice in a newspaper of general circulation. Id. Aqua noted that it interpreted this phrase as being the requested service territory, not the entire service territory. Id.
BIE indicated that it is concerned about PAWC's proposal because the notice deviates from the clear, concise language in 52 Pa. Code § 53.45 and it places the burden of requesting rate impact information on customers, rather than the utility as required in Section 53.45. BIE Supp. Comments at 2. BIE noted that, unlike the language in Section 53.45, PAWC's initial notice will not provide affected customers with any information about the potential rate impact the acquisition would have on their rates. Id. at 3. BIE claimed that the language of PAWC's proposed Statement of Reasons and Potential Bill Impact will confuse a typical residential customer by using technical terms. Id. at 3-4. BIE argued that PAWC's proposed language, contrasted with the clear, concise language in Section 53.45 does not adhere to the Commonwealth Court's directive. Id. at 4.
BIE further argued that the New Garden Court intended for Section 1329 application notice to mirror the notice requirements of Section 53.45, which would include a percentage of rate impact. Id. BIE indicated that it supports the language proposed by the OCA in its Petition to Reject or Hold in Abeyance Acceptance of Application and Petition for Stay relevant to the Exeter application.66 BIE at 4-5. BIE claimed that this language concisely informs customers about the potential rate impact. Id. at 5.
BIE further indicated that it disagrees with PAWC's proposed two-pronged notice approach because it fails to adhere to the requirements of Section 53.45. Id. BIE claimed that the initial notice will simply indicate that rates will not change until the next rate case and that it is unclear what impact the acquisition will have on customer rates. Id. BIE further claimed that the more detailed Statement of Reasons and Potential Bill Impact will only be provided to customers upon request. Id. BIE argued that PAWC's proposal improperly places the burden on the customers to seek out this information. Id. at 6. BIE averred that requiring the customer to seek out the actual rate impact is unacceptable because it fails to adhere to the delivery methods intended by the Commonwealth Court, which are those used in general rate cases. Id.
Finally, BIE noted that it supports the use of a collaborative or working group to determine how to implement customer notice. Id. BIE argued that, while efficiency is important, it is more important to get this issue right. Id. at 7. BIE argued that, in a collaborative, interested stakeholders would be able to work through the issue and reach a mutual resolution. Id. BIE maintained that the resolution must ensure that customers obtain the necessary information in a way that is meaningful to them. Id.
The OCA asserted that the two-step notice procedure proposed by PAWC does not meet the requirements of 52 Pa. Code §§ 53.45(b)(1)—(4) and the Commonwealth Court's decision in New Garden. OCA Supp. Comments at 1. The OCA indicated that it is willing to work with the parties and the Commission to resolve the conflicting positions regarding the content of notices sent to customers. Id. The OCA also noted that it has filed several petitions in pending application proceedings under Section 1329 seeking stay of those proceedings so that issues can be resolved across-the-board. Id.
The OCA argued that, in New Garden, the Commonwealth Court held that, to meet due process requirements, individualized notice must be provided directly to all ratepayers and ratepayers must be afforded an opportunity to participate in a Section 1329 proceeding. Id. at 2. Citing New Garden, the OCA argued that notice is required because the ratemaking rate base determination is fundamental to a determination of rates and a rate increase involves a substantial property right. Id. The OCA noted that the Commission's regulations contain explicit language for the notice that the utility sends to customers in a rate case, including the impact on customers' bills. Id. The OCA claimed that PAWC's proposed notice does not include any information regarding potential bill impact and does not satisfy Section 53.45 or comply with New Garden. Id. The OCA further claimed that the two-step process does not remedy this failure. Id. at 3.
The OCA recommended that the Commission adopt a single notice that is provided to all customers and includes information regarding the impact of the ratemaking rate base on customers' bills. Id. The OCA argued that the Court in New Garden directed that notice be provided in accordance with Section 53.45, which requires the notice to show the impact on customers' bills, separated by customer class, and using a typical usage level. Id. In the interest of moving the implementation process forward, the OCA proposed that the notice in Section 1329 proceedings show the impact on the revenue requirement depending on whether the revenue requirement increase related to the ratemaking rate base determination is allocated to existing water or wastewater customers, to acquired customers, or to both. Id. The OCA averred that this is the minimum rate impact information that can be included in a notice, while still advising customers that future rates could increase. Id. at 3-4.
The OCA recommended adding this information to the proposed PAWC notice in chart form. Id. at 4. The OCA noted that the chart used by PAWC is an effective means to supply the information. Id. If a chart is not used, the OCA proposed adding one or two sentences to the notice to state the range of potential rate impact. Id. The OCA proposed additional specific revisions to PAWC's proposed notice. Id. In particular, the OCA proposed to add similar language to what is included in rate case notices regarding the PUC's role modified to reflect that it is an application proceeding. Id. at 4-5. The OCA pointed to language that the PUC may approve, modify, or deny the acquisition and may approve, modify, or deny the requested addition to rate base as an example. Id. at 5. In addition, the OCA proposed to add its contact information with a description of its role. Id. The OCA provided attachments with its proposed revisions to PAWC's notice in both chart and sentence form as well as redline versions. See OCA Supp. Comments, Attachments A-B.
Further, the OCA stated that it does not recommend that the Commission adopt PAWC's pro forma Statement of Reasons and Potential Bill Impact. Id. The OCA argued that the statements contained therein are unique to the acquiring entity and the particular acquisition. Id. The OCA noted that Section 1329 does not require the acquiring entity to be an existing Pennsylvania utility. Id.
The PMAA stated that it is willing to work with the Commission and other stakeholders to develop a notice to be used as a template, provided that such notice contains adequate information regarding the rate impact on ratepayers and the options ratepayers have in response to the notice. PMAA Supp. Comments at 2. The PMAA asserted that notice must be consistent with New Garden and Section 53.45. Id. The PMAA claimed that PAWC's proposed pro forma notice fails to meet the requirements of Section 53.45. Id. at 3. In particular, the PMAA claimed that the notice fails to inform the investor-owned utility's ratepayers of the impact of the proposed acquisition on their rates, advise ratepayers that they are permitted to be a witness at a public input hearing, provide ratepayers with options in response to the notice, and identify and explain the PUC's role in the rate approval process. Id. The PMAA also averred that the proposed Statement of Reasons and Potential Bill Impact is a mere promotional piece for the pending acquisition. Id. at 3-4. The PMAA argued that PAWC is proposing one document that fails to include critical information for ratepayers, while requesting that applicants prepare another document containing information with no nexus to the requirements set forth in New Garden and the Commission's regulations. Id. at 4.
Further, the PMAA also noted that it filed an amicus brief in support of Aqua's petition for allowance of appeal pertaining to the New Garden decision. Id. The PMAA claimed that, because the Pennsylvania Supreme Court has not acted upon the petition for allowance of appeal, the requirements set forth in New Garden need to form the basis of notice to ratepayers. Id. at 4-5.
Conclusion
On October 11, 2018, approximately three weeks after the issuance of the TSIO, the Commonwealth Court issued its Order in New Garden. The Court determined that, since Section 1329 proceedings include a determination of rate base, which affects customer rates, individual notice must be given to all customers affected by the proposed sale as well as an opportunity for them to participate in the Section 1329 proceeding. Id. at 1069. The Court vacated the Commission's Order approving the New Garden transaction, directed the Commission to provide notice to all affected customers in accordance with 52 Pa. Code § 53.45, and remanded the matter to the Commission for further proceedings in accordance with the notice requirement of New Garden. Id. Aqua, the acquiring public utility in the New Garden transaction, timely petitioned the Pennsylvania Supreme Court for allowance of appeal of this decision. See McCloskey v. Pa. PUC, 743 MAL 2018 (Nov. 8, 2018). Given the procedural posture of New Garden, we note that notice requirements set forth here remain subject to the Supreme Court disposition of that case.
First, we clarify that, at present, the Commission has no active Section 1329 applications pending before it. For instance, as it pertains to the Exeter and Steelton applications, the Commission issued conditional acceptance letters on December 19, 2018, and January 17, 2019, respectively. The conditions established therein are not yet satisfied. The Commission has not issued final acceptance letters and, as such, the 10-day application consideration periods before TUS have not yet begun to run. Section 1329 conditional acceptance letters are interlocutory instruction, not final Commission action. Additionally, the Exeter and Steelton conditional acceptance letters do not endorse or approve any form of notice or notice content. The letters direct the applicants to, inter alia, provide individual notice to all potentially affected customers; it remains to be seen whether the notices proposed or used by the applicants will comply with New Garden.
The issue of appropriate notice to those affected by proposed system acquisitions subject to Section 1329 valuation has generated substantial disagreement among stakeholders. As is discussed elsewhere in this Order, the pending appeal of New Garden creates uncertainty regarding whether the notice considerations addressed by stakeholders in response to the TSIO are required in full or at all. However, one definitive conclusion may be drawn from New Garden. Namely, even after Commonwealth Court review, Section 1329 stands as a legitimate regulatory tool. In its current legal posture, New Garden provides instruction on how Acquiring Public Utilities, Entities, and Selling Utilities are to provide adequate procedural due process to all affected customers of an acquisition subject to Section 1329 valuation.
As a valid statutory valuation mechanism, Section 1329 is available to Acquiring Public Utilities, Entities, and Selling Utilities as a regulatory tool for the consolidation of water and wastewater systems throughout the Commonwealth. Similarly, the legal and practical consequence of New Garden in that context is discrete. That is, New Garden directs the Commission to develop a 52 Pa. Code § 53.45 compliant notice mechanism for all ratepayers such that ratepayers have the opportunity to be heard and to present evidence that may be taken into account by the Commission.77 The Commission will operate under the New Garden precedent, unless instructed otherwise by a court of competent jurisdiction.
In their supplemental comments, the OCA and PAWC provided versions of customer notice forms that each believed are compliant with 52 Pa. Code § 53.45. The critical difference between these competing versions is their respective approach to the potential future rate effect of any particular transaction. Other matters, such as the role of the PUC and actions that customers may take, are largely fungible and would likely be serviceable regardless of the version selected.
The rub of the notice falls to how one is to handle the myriad of potential rate effects under various rate case scenarios, some more likely than others, but all representing hypotheticals of what might be. The Commission notes that such a future rate case may not even be the ''next'' rate case filed subsequent to Commission approval of a Section 1329 valuation request. Shoehorning a variety of potential Section 1329 rate effects into the general base rate notice requirements of 52 Pa. Code § 53.45 is, as it were, easier said than done. Establishing the high and low bookends of future rate recovery of Section 1329 fair-market valuations is a speculative enterprise because those limits are inherently dependent on many factors reserved for the subsequent base rate case in which a wide variety of cost and other ratemaking inputs are reviewed and adjudicated. These include, but are not limited to, operating expenses, depreciation, state and federal income taxes, cost of debt, cost of equity, capital structure, cost of service studies, water/wastewater revenue allocations, and rate design. While these inputs are known and certain as part of a utility's proposed rate increase, and therefore quantifiable for purposes of a customer notice for a base rate case, quantifying these inputs for a future rate case, under various assumptions or scenarios as proposed by some of the commenters, is beyond the scope of 52 Pa. Code § 53.45, which was drafted for the purpose of providing notice of a base rate increase as proposed by the utility.
What makes the Section 53.45 notice acceptable for a base rate case is that it contains a reasonable degree of certainty. It does not attempt to prognosticate all possible rate case outcomes or to predict the Commission's adjudication. To do so would be folly. What that notice does project is a concrete rate increase request placed before the Commission for review.
In the Commission's judgment, providing a notice with a complex set of potential rate increase based on a variety of assumptions and scenarios, or even a range of potential outcomes, will not provide any meaningful notice to affected customers. A notice of this sort would be more confusing than informative. For example, the Section 1329 valuation could have a highly unlikely rate effect of $0. Equally unlikely is a full allocation of all costs—acquisition and perhaps others—to a rate division consisting of only the customers of the acquired municipal system. The more likely outcome is indeterminate; it will be found somewhere between possible extremes.
Under these circumstances, and in order to provide meaningful notice to residential, commercial and industrial customers regarding the effect of the proposed acquisition on their bills, the Commission directs that Section 1329 applicants are to provide one notice to all customers potentially affected by the proposed transaction, including the customers of the Selling Utility, based on the results of the most recently adjudicated rate case. As is explained above, language like that found in the Pro Forma Notice of Proposed Acquisition and Rate Base Addition proposed by PAWC would suffice to satisfy the Application Filing Checklist. As to the potential rate effect of the proposed valuation and rate base addition, Buyers shall follow the 52 Pa. Code § 53.45 format rate case example by customer class, except that Buyers will provide a NON-BINDING ESTIMATE of the likely incremental rate effect of the proposed valuation rate base addition of a typical customer's bill using reasonably certain data.
Using fictious numbers for illustrative purposes only, this should appear in the notice as follows:
Rate Class Average Usage Estimated Monthly
IncreaseResidential 4,000 gal/month $0.03 Commercial 22,000 gal/month $0.03 Industrial 500,000 gal/month $0.03 Moreover, to avoid the speculative aspects of using assumptions and scenarios of potential future rate cases, the manner of calculating the above incremental rate increase should mirror the actual results of company's most recently adjudicated base rate proceeding whether fully litigated or settled. If a Buyer has filed the thirty-day notice of 52 Pa. Code § 53.45(a), or has filed a rate case, it should calculate the above using data as proposed in its upcoming or filed rate case.
As to potential subsidy among existing and current customers, the Buyer should assume that the costs of the acquisition will be subsidized according to traditional single-tariff pricing models the Buyer has previously employed. While even these factors are (at best) an estimate, they work to avoid speculation of what a years-distant rate filing might entail, and how that speculation might translate into a specific rate design or cost allocation after Commission action. Of course, the Buyer and Seller notices may contain different numbers depending on the terms of the acquisition in question.
As to issues of timing, Section 1329 applicants are free to employ either model addressed in 52 Pa. Code § 53.45—the direct mailing of a written or printed notice or by the alternative method of a bill insert. As to the latter, Aqua is correct that New Garden will require more advance planning on the part of Buyers if they wish to avail themselves of the accelerated six-month consideration period of Section 1329.
Lastly, we reiterate that, as revised in the TSIO, Item 18(d) of the Application Filing Checklist requires applicants provide a copy of the notice sent or to be sent to affected customers describing the filing and the anticipated effect on rates. Item 18(d) is consistent with the directives above and, as such, the revisions to Item 18(d) set forth in the TSIO remain intact.
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1 SWPA indicated generally that it agrees with the Comments of Aqua, PAWC, and York.
2 Buyer refers to either an ''Acquiring Public Utility'' or ''Entity'' under Section 1329(g), while Seller refers to a ''Selling Utility'' under Section 1329(g).
3 The Buyer and Seller may agree that the Buyer will sponsor the Seller's testimony supporting the application.
4 Application of Pennsylvania-American Water Company Pursuant to Sections 507, 1102 and 1329 of the Public Utility Code for Approval of its Acquisition of the Wastewater Assets of Exeter Township, Docket No. A-2018-3004933 (Exeter application).
5 Application of Pennsylvania-American Water Company Pursuant to Sections 507, 1102 and 1329 of the Public Utility Code for Approval of its Acquisition of the Water Assets of Steelton Borough Authority, Docket No. A-2019-3006880 (Steelton application).
6 The OCA Petition to which BIE refers is the Exeter application, supra. On February 8, 2019, the Commission issued a Secretarial Letter informing the OCA that, because it had not yet formally accepted the Exeter application, that docket was inactive and that it would entertain filings in the docket when the Commission formally accepted the application pursuant to Section 1329. Because it has not formally accepted the Exeter application, the Commission has not as yet taken final action related to it.
7 We note that in New Garden the language of Senior Judge Pellegrini literally directs the Commission ''to provide notice to all ratepayers in accordance with 52 Pa. Code § 53.45.'' Of course, providing such actual notice under regulation Section 53.45 is the responsibility of the public utility filing for relief.
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