[35 Pa.B. 3024]
[Continued from previous Web Page]
Exhibit A
I. VALUATION * * * * *
E. (Reserved) * * * * *
III. BALANCE SHEET AND OPERATING STATEMENT * * * * *
C. (Reserved) * * * * *
IV. RATE STRUCTURE
A. (Reserved) * * * * *
Exhibit D
WATER AND WASTEWATER UTILITIES
I. STATEMENT OF INCOME 1. Provide comparative operating statements for the historic test year and the immediately preceding 12 months showing increases and decreases between the two periods. These statements should supply detailed explanation of the causes of the major (greater than 15%) variances between the historic test year and preceding year by detailed account number. Limit the explanation to differences of $10,000 or greater.
2. Prepare an income statement for the various time frames of the rate proceeding including:
Col. 1--Book recorded income statement for the test
year.2--Adjustments to book recorded income statement to
annualize and normalize under present rates.3--Income statement under present rates after adjust-
ments in Col. 2.4--Adjustments to Col. 3 for revenue increase re-
quested.5--Income statement under proposed rates.
3. If a company has separate operating divisions, an income statement must be shown for each division, plus an income statement for the company as a whole.
4. Provide operating income claims under:
a. Present rates.
b. Pro forma present rates (annualized & normalized).
c. Proposed rates (annualized & normalized).
5. Provide rate of return on original cost under:
a. Present rates.
b. Pro forma present rates.
c. Proposed rates.
II. OPERATING REVENUES 1. Prepare a summary of operating revenues for the historic test year and the year preceding the historic test year, providing the following information:
a. For each classification of customers:
(i) Number of customers as of year-end.
(ii) Gallons sold.
(iii) Revenues.
b. Customers' penalties and miscellaneous water revenues.
2. Prepare a summary of operating revenues for the historic test year, providing the following information:
a. For each classification of customers and for customers' penalties and miscellaneous water or wastewater revenues:
(i) Revenues.
(ii) Annualizing and normalizing adjustments to arrive at adjusted operating revenues for ratemaking.
(iii) Proposed increase in operating revenues.
(iv) Percent increase in operating revenues.
(v) Operating revenues under proposed rates.
3. Provide a schedule of present and proposed tariff rates showing dollar change and percent of change by block. Provide increases to customers at various monthly uses (each 5,000 gallon consumption increment) showing billings at existing and proposed rates. Provide also an explanation of any change in block structure and the reason therefore. Provide a copy of the proposed tariff or tariff supplement on a red line basis, to easily identify any changes.
4. Provide for the future test year a detailed customer consumption analysis and the application of rates to support present and proposed revenues by customer classification and tariff rate schedule.
5. Provide detailed computations of the determination of accrued revenues as of historic test year-end and year-end immediately preceding the historic test year, together with a detailed explanation of the procedures and methods used in developing accrued revenues.
6. Provide a detailed breakdown of miscellaneous water revenues for the historic test year and the two years immediately preceding the historic test year. For the historic test year, provide a monthly breakdown and an explanation of monthly variances greater than 15%.
7. Provide a monthly summary of customers added and lost by customer classification for the historic test year and the current year-to-date.
8. Provide for the historic test year and the current year-to-date, the number of customers and monthly consumption for each classification of customers.
9. Provide by customer classification for the historic test year and for the 2 prior years the number of customers and consumption, and projected number of customers and consumption for the 2 subsequent years.
10. Provide a breakdown of the number and size of private fire services according to the general water service class of customers.
a. Provide a listing of all public fire protection customers at historic test year-end and the pro forma billing of current rates for each customer.
11. Provide a detailed schedule of sales for resale revenues for the historic test year and 2 preceding years showing revenues and units sold by customer.
12. Provide for the historic test year and the 2 prior years consumption and billings for the ten largest customers at current rates. Provide the historic and future test year consumption priced at proposed rates.
13. Provide for the historic test year and the 2 prior years consumption and billings for the ten largest sales for resale customers if such sales are not included in sales to the ten largest customers requested in Part II.12.
III. OPERATING EXPENSE 1. Prepare a summary of operating expenses by operating expense account for the historic test year and the 2 years preceding the test year.
2. Prepare a summary of operating expenses for the historic test year providing annualizing and normalizing adjustments to arrive at adjusted future operating expenses for ratemaking, including supporting data.
3. List extraordinary property losses as a separate item, not included in operating expenses or depreciation and amortization. Sufficient supporting data must be provided, such as explanation and breakdown of costs.
4. Supply detailed calculations of normalization of rate case expense, including supporting data for outside services rendered. Provide the items comprising the rate case expense claim (include the actual billings or invoices in support of each kind of rate case expense) and the items comprising the actual expenses of the prior rate cases.
5. Submit detailed computation of adjustments to operating expenses for salary, wage and fringe benefit increases (union and nonunion merit, progression, promotion and general) granted during the historic test year and during the 12 months subsequent to the historic test year. Supply data for the historic test year showing:
a. Actual payroll expense (regular and overtime separately) by categories of operating expenses, i.e., maintenance, operating transmission, distribution, other.
b. Date, percentage increase and annual amount of each general payroll increase during the historic test year and future test year.
c. Dates and annual amounts of merit increases or management salary adjustments.
d. Total annual payroll increases in the historic and future test years.
e. Proof that the actual payroll plus the increases equal the payroll expense claimed in the supporting data by categories of expenses.
f. Detailed list of employee benefits and cost thereof for union and nonunion personnel. Specific benefits for executives and officers should be included, and costs thereof.
g. Support the annualized pension cost figures by providing the following:
(i) State whether these figures include any unfunded pension costs. Explain.
(ii) Provide latest actuarial study used for determining pension accrual rates.
h. Submit a schedule showing any deferred income and consultant fee, paid to both, corporate officers and employees in historic and future test years.
6. Supply an exhibit showing an analysis, by functional accounts, of the charges by affiliates (service corporations, etc.) for services rendered included in the operating expenses of the filing company for the historic and future test years and for the 12-month period ended prior to the historic test year:
a. Supply a copy of contracts, if applicable.
b. Explain the nature of the services provided.
c. Explain the basis on which charges are made.
d. If charges are allocated, identify allocation factors used.
e. Supply the components and amounts comprising the expense in this account.
f. Provide details of initial source of charge and reason thereof.
7. Describe costs relative to leasing equipment, computer rentals, and office space, including terms and conditions of the lease. Explain the method of calculating monthly or annual payments. If allocated from the parent company, provide the method of allocation.
8. Submit detailed calculations (or best estimates) of the cost resulting from storm damage.
9. Submit details of expenditures for advertising (national, institutional and local media). Provide a schedule of advertising expense by media categories for the historic test year and the prior two comparable years with respect to:
a. Public health and safety.
b. Conservation of energy.
c. Explanation of billing practices, rates, rules and regulations.
d. Provision of factual and objective data programs in educational institutions.
e. Other advertising programs.
f. Total advertising expense.
10. Prepare a detailed schedule for the historic test year showing types of social and service organization memberships paid for by the company and the cost thereof.
11. Submit a schedule showing a breakdown by the expenditures associated with outside services employed, regulatory commission expenses, showing expenses relating to rate cases separately, and miscellaneous general expenses, for the historic test year and prior 2 comparable years.
12. Submit details of information covering research and development expenditures, by project, within the company and note forecasted company programs.
13. Provide a detailed schedule of all charitable and civic contributions by recipient and amount for the historic test year.
14. Provide the two most recent actuarial studies for both pension expense and postretirement benefits other than pensions (OPEBs).
15. Identify the total pension expense under statement of accounting standards (SFAS 87) for the historic test year and the portion charged to operation and maintenance (O & M). Include an analysis showing the contribution to the pension plan and the amount deferred or expensed for each of the past 2 years and the historic test year. Also provide any estimates for the future year.
16. Provide an analysis of OPEBs showing the accrual amount under SFAS 106 and the pay-as-you-go expense.
17. Reconcile the historic and future test year SFAS No. 106 expense levels with the amount identified in the actuarial report.
18. Identify the actual or projected amounts contributed to SFAS No. 106 funds for the historic and future test years. Identify the actual or projected dates and amounts of the contributions.
19. Explain the funding options or plans which are being used for SFAS No. 106 costs. Identify the portion of costs which are eligible for tax preferred funding.
20. State whether the company is studying or anticipating any changes to its postretirement benefits offered to employees as a result of SFAS No. 106 or for other reasons. If yes, provide the study and explain the anticipated change.
21. State whether the historic test year expenses reflect any accruals for postemployment benefits under SFAS 112. If yes, provide complete details including supporting documentation, assumptions, and funding mechanisms.
22. Provide a copy of all incentive compensation and bonus plans and provide the level of related bonus payments included in the cost of service. Provide information for the preceding 2 years and any changes since the last rate case.
23. Provide the most recent insurance premiums for each type of insurance coverage, both employee benefit and those purchased for the company, reflected in the company's filing. If available, provide estimated premiums for the subsequent calendar year.
24. Provide the level of payments made to industry organizations included in the cost of service along with a description of each payee organization.
25. If the company has included any costs associated with canceled construction projects or obsolete inventory in requested rates, separately identify the items, provide the related amounts and explain the reason for the cancellation or obsolescence.
26. Explain how the company accounts for vacation pay for book and ratemaking purposes.
27. Indicate whether any employee positions have been eliminated since the commencement of the historic test year or are expected to be eliminated during the future test year.
28. Furnish the name of each supplier, gallonage and expense for water purchased as recorded in Water Purchased for Resale-Account 706 for the historic test year and two preceding years.
IV. TAXES 1. Provide a copy of the latest Pennsylvania Corporate Tax report and the latest Pennsylvania Corporate Tax settlement.
2. Submit details of calculations for taxes, other than income, where a company is assessed taxes for doing business in another state, or on its property located in another state.
3. Submit a schedule showing for the last 3 years the Income Tax refunds, plus interest, net of taxes, received from the Federal government due to prior years' claims.
4. Provide detailed computations showing the deferred income taxes derived by using accelerated tax depreciation applicable to post-1969 utility property that increases productive capacity, and accelerated depreciation rate (ADR) rates on property (separate between State and Federal; also, rate used). If based on the historic test year, justify.
a. State whether tax depreciation is based on all rate base items claimed as of the end of the future test year, and whether it is the annual tax depreciation at the end of the future test year.
b. Reconcile any difference between the deferred tax balance, as shown as a reduction to measures of value (rate base), and the deferred tax balance as shown on the balance sheet.
5. Submit a schedule showing a breakdown of accumulated investment tax credits, (3%, 4%, 7%, 10% and 11%), together with details of methods used to write-off the unamortized balances.
6. Submit a schedule showing the adjustments for taxable net income per book, including below-the-line items, and pro-forma under existing rates, together with an explanation of any difference between the adjustments. Indicate charitable donations and contributions in the tax calculation for ratemaking purposes.
7. Submit detailed calculations supporting historic and future taxable income before State and Federal Income Taxes where the income tax is subject to allocation due to operations in another state, or due to operation of other taxable utility or nonutility business, or by operating divisions or areas.
8. Furnish a breakdown of major items comprising prepaid and deferred Income Tax charges and other deferred income tax credits and reserves by accounting areas.
9. Explain the reason for the use of cost of removal of any retired plant figures in the Income Tax calculations.
10. State whether all tax savings due to accelerated depreciation on property installed prior to 1970 have been passed through to income. If not, explain.
11. Show any income tax loss/gain carryovers from previous years that may affect historic test year income taxes or future test year Income Taxes. Show loss or gain carryovers by years of origin and amounts remaining by years at the end of the historic test year.
12. Provide a detailed analysis of taxes accrued per books as of the historic and future test year date. Also supply the basis for the accrual and the amount of taxes accrued monthly.
13. Under Section 1552 of the Internal Revenue Code and Regulations at 1.1552-1 if applicable, a parent company, in filing a consolidated Income Tax return for the group, must choose one of four options by which it must allocate total income tax liability of the group to the participating members to determine each member's tax liability to the Federal government. If this request is not applicable, provide an explanation.
a. State what option has been chosen by the group.
b. Provide, in summary form, the amount of tax liability that has been allocated to each of the participating members in the consolidated Income Tax return.
c. Provide a schedule, in summary form, of contributions, which were determined on the basis of separate tax return calculations, made by each of the participating members to the tax liability indicated in the consolidated group tax return. Provide total amounts of actual payments to the tax depository for the tax year, as computed on the basis of separate returns of members.
d. Provide annual Income Tax return for group, and if Income Tax return shows net operating loss, provide details of amount of net operating loss allocated to the income tax returns of each of the members of the consolidated group.
14. Provide a copy of the Corporate Federal Tax Returns and supporting schedules for the preceding 3 years and, if applicable, a copy of the calculation workpapers for the company's consolidated tax savings adjustment.
15. Provide a schedule of Federal and Pennsylvania taxes, other than Income Taxes, calculated on the basis of test year per book, pro forma at present rates, and pro forma at proposed rates, to include the following categories:
a. Social Security.
b. Unemployment.
c. Capital Stock.
d. Public Utility Realty.
e. PUC assessment.
f. Other property.
g. Any other appropriate categories.
16. Submit a schedule showing a breakdown of the deferred Income Taxes by State and Federal per book, pro forma, existing rates, and under proposed rates.
17. With respect to determination of income taxes, Federal and State:
a. Show Income Tax results of the annualizing and normalizing adjustments to the historic test year before any rate increase.
b. Show Income Taxes for the annualized and normalized test year.
c. Show Income Tax effect of the rate increase requested.
d. Show Income Taxes for the normalized and annualized test year after application of the full rate increase.
18. State amount of debt interest utilized for Income Tax calculations, and details of debt interest computations, under each of the following rate case bases:
a. Actual per book test year.
b. Annualized historic test year-end.
c. Proposed future test year-end.
V. RATE BASE 1. Provide a schedule showing the measures of value and the rates of return at the original cost in the current case. All claims made on this exhibit should be cross-referenced to appropriate exhibits.
2. If a claim is made for construction work in progress, include, in the form of an exhibit, the summary page from all work orders, amount expended at the end of the historic and future test year and anticipated in-service dates. Indicate if any of the construction work in progress will result in insurance recoveries, reimbursements, or retirements of existing facilities. Describe in exact detail the necessity of each project claimed if not detailed on the summary page from the work order. Include final completion dates and estimated total amounts to be spent on each project. This exhibit should be updated at the conclusion of these proceedings.
3. If a claim is made for nonrevenue producing construction work in progress, include, in the form of an exhibit, the summary page from all work orders, amount expended at the end of the historic and future test year and anticipated in-service dates. Indicate if any of the construction work in progress will result in insurance recoveries, reimbursements, or retirements of existing facilities. Describe in exact detail the necessity of each project claimed if not detailed on the summary page from the work order. Include a list of items needed to complete each project, such as landscaping and fencing, and estimated total amounts to be spent to complete each project. These exhibits should be updated at the conclusion of these proceedings.
4. If a claim is made for plant held for future use, supply the following:
a. A brief description of the plant or land site and its original cost.
b. Expected date of use for each item claimed.
c. Explanation as to why it is necessary to acquire each item in advance of its date of use.
d. Date when each item was acquired.
e. Date when each item was placed in the plant held for future use account.
5. If fuel stocks comprise part of the cash working capital claim, provide an exhibit showing the actual book balances, noting quantity and price for the fuel inventories by type of fuel for the 13 months prior to the end of the historic test year by location, station, etc. Explain the method of determining the claim if other than that described above.
6. Explain in detail by statement or exhibit the appropriateness of claiming any additional items, not previously mentioned, in the measures of value.
7. Provide schedules and data in support of the following working capital items:
a. Prepayments-list and identify all items.
b. Federal Income Tax accrued or prepaid.
c. Pennsylvania State Income Tax accrued or prepaid.
d. Pennsylvania Capital Stock Tax accrued or prepaid.
e. Pennsylvania Public Utility Realty Tax accrued or prepaid.
f. Payroll taxes accrued or prepaid.
g. Any adjustments related to the above items for ratemaking purposes.
8. Supply an exhibit supporting the claim for cash working capital requirement based on the lead-lag method.
a. Pro forma expenses and revenues are to be used in lieu of book data for computing lead-lag days.
9. Indicate if amortized expenses have been removed from the lead-lag study. If so, please provide documentation showing such removal. If not, provide a list of such amortization expenses included.
10. Identify the funds availability arrangements or terms which the company has with its banks with respect to deposits of customer checks. For example, does the company have same day or next day access to funds deposited?
11. In reference to materials and supplies:
a. What method of inventory valuation was used to develop the claim for materials and supplies?
b. Does the utility use a material and supply model to calculate needed material and supply levels?
c. If so, provide the model. Supply an illustrative example of how the monthly balances are derived.
d. Provide the actual monthly value for the inventory of materials and supplies for the past 12 months. Supply as of the end of the historic test year, a 13-month average, by month, for the material and supply account.
e. Provide the monthly level of materials and supplies for 3 years prior to the conclusion of the historic test year.
12. For each nonblanket or projected plant addition to cost the greater of $100,000 or 0.5% of current rate base, included in the future test year, please provide:
a. Description of the project.
b. Original budgeted cost broken down by allowance for funds used during construction (AFUDC) and non-AFUDC components.
c. Current budgeted cost broken down by AFUDC and non-AFUDC components.
d. Reason for change in budgeted cost.
e. Original estimated date of completion and in service.
f. Current estimated date of completion and in service.
g. Reason for change in completion date.
h. Anticipated retirement related to the plant addition.
i. Starting date of project.
j. Amount expended to date.
k. Percent of project currently complete.
l. The depreciation rate applicable.
m. Identify which projects are due to a Pennsylvania Department of Environmental Protection (PA-DEP) or Federal Environmental Protection Agency (EPA) requirement.
13. Explain how the future test year plant balances were projected and provide supporting workpapers and documentation.
14. Are all of the assets used in the plant-in-service claim used exclusively by the water or wastewater utility? If not, provide the estimated percentage that each shared asset is used by other entities.
15. Is all plant included in rate base currently being used in providing water or wastewater service? If not, provide a schedule which presents those plant items which are not, and indicate the corresponding amounts and account numbers. Further, provide a detailed narrative explaining the reason why such plant is not being used and the anticipated future disposition of the plant.
16. Provide all workpapers and supporting documentation showing the derivation of the projected balances of contributions in aid of construction, customer advances for construction and company service line and customer deposits for the future test year.
VI. DEPRECIATION If any of the following questions under this section have been previously answered pursuant to 52 Pa. Code Chapter 73, please note in your response. It is not necessary to provide responses to questions previously answered.
1. Provide a description of the depreciation methods used to calculate annual depreciation amounts and depreciation reserves, together with a discussion of the factors which were considered in arriving at estimates of service life and dispersion by account. Supply a comprehensive statement of any changes made in method of depreciation. Provide dates of all field inspections and facilities visited.
2. Set forth, in exhibit form, charts depicting the original and estimated survivor curves and a tabular presentation of the original life table plotted on the chart for each account where the retirement rate method of analysis is utilized.
3. Provide the surviving original cost at historic test year-end by vintage by account and include applicable depreciation reserves and accruals. These calculations should be provided for plant in service as well as other categories of plant, including contributions in aid of construction and customers' advances for construction.
4. Provide a comparison of the calculated depreciation reserve used for ratemaking purposes v. the book reserve by account at the end of the test year, if they differ.
5. Supply a schedule by account and depreciable group showing the survivor curve and annual accrual rate estimated to be appropriate:
a. For the purposes of this filing.
b. For the purposes of the most recent rate increase filing prior to the current proceedings.
6. Provide an exhibit showing gross salvage, cost of removal, and net salvage for the 5 most recent calendar or fiscal years by account.
VII. RATE OF RETURN 1. Provide capitalization and capitalization ratios for the last 5-year period and projected through the next 2 years (with short-term debt and without short-term debt) for the company, parent and consolidated system.
a. Provide year-end interest coverages before and after taxes for the last 3 years and at the latest date, including indenture and Securities and Exchange Commission (SEC) bases, for the company, parent and consolidated system.
b. Provide year-end preferred stock dividend coverages for the last 3 years and at latest date, including charter and SEC bases.
2. Provide latest prospectus for the company and the parent.
3. Supply projected capital requirements and the sources of company, parent and consolidated system for the historic test year and each of 3 comparable future years.
4. Provide a schedule of debt and preferred stock of company, parent and consolidated system as of historic test year-end and latest date, detailing for each issue (if applicable):
a. Date of issue.
b. Date of maturity.
c. Amount issued.
d. Amount outstanding.
e. Amount retired.
f. Amount required.
g. Gain on reacquisition.
h. Coupon rate.
i. Discount or premium at issuance.
j. Issuance expenses.
k. Net proceeds.
l. Sinking fund requirements.
m. Effective interest rate.
n. Dividend rate.
o. Effective cost rate.
p. Total average weighted effective cost rate.
5. Supply financial data of company and/or parent for last 5 years:
a. Earnings-price ratio (average).
b. Earnings-book value ratio (per share basis) (average book value).
c. Dividend yield (average).
d. Earnings per share (dollar).
e. Dividends per share (dollars).
f. Average book value per share yearly.
g. Average yearly market price per share (monthly high-low basis).
h. Pre-tax funded debt interest coverage.
i. Post-tax funded debt interest coverage.
j. Market price-book value ratio.
6. Provide AFUDC charged by company at historic test year-end and latest date, explain method by which rate was calculated and provide workpaper showing derivation of the company's current AFUDC rate.
7. Set forth provisions of company's and parent's charter and indentures, if applicable, which describe coverage requirements, limits on proportions of types of capital outstanding, and restrictions on dividend payouts.
8. Attach copies of the summaries of the company's projected revenues, expenses and capital budgets for the next 2 years.
9. Describe long-term debt reacquisitions by company and parent as follows:
a. Reacquisitions by issue by year.
b. Total gain on reacquisitions by issue by year.
c. Accounting of gain for income tax and book purposes.
10. Provide the following information concerning compensating bank balance requirements for actual per book test year:
a. Name of each bank.
b. Address of each bank.
c. Type of accounts with each bank (checking, savings, escrow, other services, etc.).
d. Average daily balance in each account.
e. Amount and percentage requirements for compensating bank balances at each bank.
f. Average daily compensating bank balance at each bank.
g. Documents from each bank explaining compensating bank balance requirements.
h. Interest earned on each type of account.
11. Provide the following information concerning bank notes payable for actual per book test year:
a. Line of credit at each bank.
b. Average daily balances of notes payable to each bank, by name of bank.
c. Interest rate charged on each bank note (prime rate, formula).
d. Purpose of each bank note, (for example, construction, fuel storage, working capital, debt retirement).
e. Prospective future need for this type of financing.
12. Submit details on company or parent common stock offerings for the past 5 years to present, as follows:
a. Date of prospectus.
b. Date of offering.
c. Record date.
d. Offering period including dates and number of days.
e. Amount and number of shares of offering.
f. Offering ratio, if rights offering.
g. Percent subscribed.
h. Offering price.
i. Gross proceeds per share.
j. Expenses per share.
k. Net proceeds per share in (12.) i and j.
l. Market price per share.
(1) At record date.
(2) At offering date.
(3) One month after close of offering.
m. Average market price during offering.
(1) Price per share.
(2) Rights per share-average value of rights.
n. Latest reported earnings per share at time of offering.
o. Latest reported dividends at time of offering.
13. Attach a chart explaining company's corporate relationship to its affiliates showing system structure.
14. If the utility plans to make a formal claim for a specified allowable rate of return, provide the following data in statement or exhibit form:
a. Claimed capitalization and capitalization ratios with supporting data.
b. Claimed cost of long-term debt with supporting data.
c. Claimed cost of short-term debt with supporting data.
d. Claimed cost of total debt with supporting data.
e. Claimed cost of preferred stock with supporting data.
f. Claimed cost of common equity with supporting data.
15. Supply copies of the following documents for the company and, if applicable, its parent:
a. Most recent annual report to shareholders including any statistical supplements.
b. Most recent SEC form 10K.
c. All SEC form 10Q reports issued within the preceding 12 months of the date of submittal of the rate increase request.
16. Supply copies of the company's balance sheets for each month for the last 2 years.
17. Provide the bond rating history for the company and, if applicable, its parent from the major credit rating agencies for the last five years.
18. Provide copies of all bond rating reports relating to the company and, if applicable, its parent for the past 2 years.
19. Supply copies of all presentations by the company's and, if applicable, its parent's management and securities analysts during the past 2 years, including presentations of financial projections.
20. Provide a listing of all securities issuances for the company and, if applicable, its parent projected for the next 2 years. The response shall identify for each projected issuance the date, dollar amount, type of security, and effective cost rate.
21. Identify any plan by the company to refinance high cost long-term debt or preferred stock.
22. Provide copies of all securities analysts' reports relating to the company and its parent, or both, issued within the past 2 years.
23. If applicable, supply a listing of all common equity infusions from the parent to the company over the past 5 years. In each case, identify date and dollar amount.
24. If applicable, identify the company's common dividend payments to its parent for each of the last 5 years.
25. Provide the latest year-by-year financial projections for the company for the next 5 years. Also, please indicate the date these projections were prepared; whether approved by management; and whether the projections have been submitted to bond rating agencies. The information will be treated in a confidential manner, if requested by the company in writing, as set forth in 52 Pa. Code § 5.423.
26. Provide the company's 5-year construction budget.
27. Identify the company's and, if applicable, its parent's capital structure targets (percentages of capital types). Provide the complete basis for the capital structure targets.
28. For each month, of the most recent 24 months, supply the company's:
a. Short-term debt balance.
b. Short-term debt interest rate.
c. Balance of construction work in progress.
d. Balance of construction work in progress which is eligible for AFUDC accrual:
29. Fully identify all debt, other than instruments traded in public markets, owed to all shareholders, corporate officers, or members of the board of directors, its affiliates, parent company, or subsidiaries.
30. Provide a summary statement of all stock dividends, splits, or par value changes during the 2-year calendar period preceding the rate case filing.
31. If a claim of the filing utility is based on utilization of the capital structure or capital costs of the parent company and consolidated system, the reasons for this claim must be fully stated and supported.
32. To the extent not provided elsewhere, supply financial data of the company, and its parent, if applicable, for the last 5 years.
a. Times interest earned ratio--pre- and posttax basis.
b. Preferred stock dividend coverage ratio--posttax basis.
c. Times fixed charges earned ratio--pre tax basis.
d. Dividend payout ratio.
e. AFUDC as a percent of earnings available for common equity.
f. Construction work in progress as a percent of net utility plant.
g. Effective income tax rate.
h. Internal cash generations as a percent of total capital requirements.
VIII. RATE STRUCTURE AND COST OF SERVICE 1. Provide a complete, fully allocated, cost of service study if an interval of 3 years has passed between a previous cost of service study and the historic test year date of the current filing. The cost of service study shall provide the necessary data to determine if the water or wastewater rate structure is fair and equitable to all classifications of water or wastewater customers (including public and private fire protection customers) and reflects, as nearly as possible, the cost of providing the service. The study shall correspond to the test year proposed revenue requirements (future test year only, if used). Summaries of conclusions and all back-up calculations shall be made part of the submission of the cost of service study, and shall include the following:
a. A description of the allocation methods used. A comparison of the allocated cost of service by class with the present and proposed revenues. A cost of service schedule showing the rate of return produced by present and proposed rates by class of service.
b. Indicate if the method used for establishing the allocation factors in the cost of service study deviates from the previous study submitted in the last rate case. If yes, indicate which allocation factors were changed and discuss the reason for the changes.
c. Supply the average day, the maximum day and the maximum hour deliveries to the system adjusted for storage for the historic test year and 2 prior years. Also provide workpapers, analyses, comparative data or other documentation supporting the estimated maximum day and peak hour demands by customer class reflected in the company's cost of service study.
d. Explain thoroughly the methodology employed if the company distinguishes between transmission and distribution or collection mains in its allocation of costs.
e. Provide a detailed explanation of how storage is utilized to meet base, maximum day and maximum hour demands.
f. Provide workpapers, calculations and supporting documentation which develop the equivalent meters and equivalent service line weights reflected in the company's cost of service study.
g. Provide all workpapers and supporting documentation for the fire flow requirement and duration utilized in the cost of service study.
h. Provide a breakdown of the number and size of private fire services according to the general water service class of customer.
i. Provide a calculation of the company's base cost of water or wastewater per unit of consumption or usage.
j. Provide a detailed cost analysis that supports the company's customer charges, by meter size, showing all direct and indirect costs included.
2. Provide a listing of negotiated special rate contracts which includes a comparison of revenues under special rate contracts and under tariff rates. Provide the cost of service treatment of any deficiency in revenues resulting from the negotiated special rate contracts. Special rates are defined as rates not contained in the currently effective tariff.
IX. QUALITY OF SERVICE 1. Indicate whether the company is in violation of any provision of the Pennsylvania Safe Drinking Water Act (SDWA) or any rule, regulation or order, or any condition of any permit, variance or exemption granted by the Pennsylvania Department of Environmental Protection (PA-DEP), or its predecessor.
a. Provide information indicating whether the company is in compliance with SDWA provisions at 25 Pa. Code § 109.407 regarding general public notification requirements:
(i) Provide a copy of each public notification given in accordance with this section, since the last rate proceeding.
(ii) Provide a detailed explanation of all actions taken to remedy an acute violation, and to comply with the requirements prescribed by a variance or exemption.
(iii) State whether any fines or penalties were assessed by PA-DEP, and indicate the amounts paid by the company.
b. Provide the most recent copies of all annual consumer confidence reports issued pursuant to SDWA Amendments of 1996 since the last rate proceeding.
(i) Provide any annual consumer confidence reports which reflect violations of State and Federal safe drinking water requirements.
(ii) Explain how these violations were resolved.
2. Indicate whether the company is in compliance with 52 Pa. Code, § 65.6(a) regarding normal operating pressure standards, and with 52 Pa. Code, § 65.6(d) regarding pressure surveys at regular intervals.
a. Provide details on any water pressure problems, lasting longer than 5 days, which had occurred since the last rate proceeding in any part of the water transmission and distribution system.
b. Describe any action taken on a temporary basis, and the long term solutions developed to address any water pressure problems.
3. Provide support to demonstrate that water or wastewater service is being furnished on a continuous basis by supplying a summary of the company's records of each service interruption greater than 24 hours since the last rate proceeding.
4. Provide a discussion of the company's policy, or provide a copy of the policy if in written form, on tracking and responding to customer complaints.
a. Provide a summary report demonstrating the company's compliance with 52 Pa. Code, § 65.3 regarding the full and prompt investigation of service or facility complaints and the recordkeeping requirements of such complaints.
5. Indicate whether the company is in compliance with 52 Pa. Code, § 65.4(b) regarding complete and current mapping of the entire distribution or collection system.
6. Provide a summary report demonstrating the company's efforts in water conservation, since the last rate proceeding, pursuant to 52 Pa. Code, § 65.20.
7. Provide a discussion of the company's policy regarding meter requirements, replacements and testing. State if the company's procedures are in compliance with 52 Pa. Code, § 65.8(b).
a. Provide meter test records as required in 52 Pa. Code, § 65.8(c) for the 50 meters most recently removed from service.
b. Provide a discussion of the company's policy and history of compliance with 52 Pa. Code, § 65.9 regarding adjustment of bills for meter error within the last year.
X. BALANCE SHEET 1. Provide a comparative balance sheet for the historic test year-end and the preceding year-end.
2. Provide a detail of other physical property, investments in affiliated companies and other investments.
3. Provide the amounts and purpose of special cash accounts as of the historic test year-end.
4. Describe the nature and amounts of notes receivable, accounts receivable from associated companies, and any other receivables, other than customers' accounts, greater than 15% of the total. Limit the explanation to variances greater than $10,000.
5. Provide the amount of accumulated reserve for uncollectible accounts, method and rate of accrual, amounts accrued and amounts written-off in each of the last 3 years.
6. Provide a list of prepayments and give an explanation of special prepayments.
7. Break down and explain in detail any significant items, greater than 15% of the total, in the current assets account listed on the balance sheet. Limit the explanation to variances greater than $10,000.
8. Explain in detail, including the amount and purpose, the deferred asset accounts that currently operate to affect or will at a later date affect the operating account supplying:
a. Origin of these accounts.
b. Probable changes to this account in the near future.
c. Amortization of these accounts currently charged to operations or to be charged in the near future.
9. Explain the nature of accounts payable to associated companies. Provide a breakdown by category.
10. Provide breakdown and explanation of other deferred credits as to their origin and disposition policy, for example, amortization.
11. Provide an explanation and method of funding of any reserves, other than depreciation and bad debt appearing on historic balance sheet.
12. Provide an analysis of unappropriated retained earnings for the historic test year and 2 preceding years.
13. Describe the purpose of any advances made by the company to its parent corporation and describe all terms and conditions associated with such advances, including an estimate of future advances or repayments that are expected to occur.
XI. OTHER DATA 1. Provide the company's monthly balance sheets and income statements for each month of the historic and future test year.
2. Supply a copy of internal and independent audit reports of the historic test year and prior calendar year, noting any exceptions and recommendations and disposition thereof.
3. Provide all monthly or quarterly, or both, budget variance reports to management, or the board of directors, or both, submitted during the past year. Please provide the most recent detailed budget variance report which the company compiled, and update as additional reports are issued.
4. Provide a copy of the company's most recent operating and capital budgets.
5. Provide a schedule that shows the percentage of unaccounted for water for the test year and 2 prior years. Describe how this amount was determined and explain any steps taken to reduce unaccounted for water. Provide a similar analysis of infiltration for wastewater utilities.
6. Provide a corporate history (include the dates of original incorporation, subsequent mergers, or acquisitions, or both). Indicate all counties and cities and other governmental subdivisions to which service is provided, including service areas outside the state, and the total population in the area served.
[Pa.B. Doc. No. 05-990. Filed for public inspection May 20, 2005, 9:00 a.m.]
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