OF A TELEPHONIC HEARING ON THE APPLICATION OF ICR Water Users Association, Inc. FOR APPROVAL OF THE SALE OF ITS ASSETS AND TRANSER OF ITS CERTIFICATE OF CONVENIENCE AND NECESSITY TO INSCRIPTION CANYON WATER COMPANY
DOCKET W-02824A-20-0013, ET AL.
On January 24, 2020, ICR Water Users Association, Inc. (“Company”) filed with the Arizona Corporation Commission an application (“Application”) for approval of the sale of its assets and for the transfer of the Company’s Certificate of Convenience and Necessity to provide water service in Arizona to Inscription Canyon Water Company, a nonprofit corporation. The Commission has scheduled a telephonic evidentiary hearing on the Application to commence Monday, July 6, 2020, at 10:00 AM. Public comments will be taken via telephone on the first day of the hearing. Interested customers and persons desiring to provide public comments shall on the date of the hearing, and at least five minutes prior to the start of the hearing, dial 1-888-450-5996 and enter participant code 457395#, preferably using a landline phone.
A copy of the Application is available at the Company’s office at 302 W. Willis Street, Suite 203, Prescott, Arizona 86301 during business hours from 10 AM to 3 PM, Monday through Friday; at the Commission’s Docket Control Center at 1200 West Washington Street, Phoenix, Arizona, 85007, during regular business hours; and on the Commission’s website (www.azcc.gov) using the e-Docket function.
Written comments on the Application may be submitted by mailing a letter referencing Docket W-02824A-20-0013 to Arizona Corporation Commission, Consumer Services Section, 1200 West Washington, Phoenix, Arizona 85007, or by submitting comments on the Commission’s website (www.azcc.gov) by clicking on “Cases and Open Meetings” and “Make a Public Comment in a Docket.” If you require assistance, you may contact the Consumer Services Section at 602-542-4251 or 1-800-222-7000.
ICRWUA Membership Update – May 26th , 2020
Dear Fellow Members:
As most of you are aware, all large gatherings are currently prohibited. For this reason, we have not been able to hold a quarterly public meeting this quarter, or an annual meeting for our membership. We hope to do so after the state/county authorities declare later phases of re-opening that permit such gatherings.
In lieu of public meetings, the board of directors would like to provide this report on the current state of affairs with your water company.
- Transfer of assets and water distribution authorizations to ICWC (New water company)
Since the board resolution last September authorizing the legal work to commence on this project, the legal entity (Inscription Canyon Water Company) has been formed.
We, the members, elected it’s board of directors in December, and voted (by mail in ballot in January 2020) to support the transfer of our current legal entity’s (Inscription Canyon Water User’s Association) assets and CC&N’s to ICWC. The resolution passed with almost a 3:1 majority.
Due diligence has since been performed by the ACC, and legal staff has recommended to the judge appointed to our case that the transaction be approved, subject to some administrative conditions prior to closing.
A public comments session was conducted telephonically in late April, where several members presented opinions regarding this proposed transaction. At that time, the administrative judge scheduled an open public hearing for July 6th, to hear testimony on the case. This may of course be affected by the degree of “openness” the state government is in at that time. This hearing was noticed according to state laws through direct member communications as well as notices in local newspaper outlets.
If the judge’s ruling supports the recommendation of his staff, the new water company will become the provider of our water sometime in late fall.
- Operations Goals Stated at our inaugural 2020 Board Meeting:
a) Audit Operations Procedures and Evaluate Risks
A preliminary audit of operations practices and risks, and a facilities walk through has been performed. This involved both board and non-board members as well as contract operations personnel. Some operational changes to the way the 2 ICR wells were operated have been made. Investigations will follow regarding emergency contracts for power generation and water haulage.
b) Formalize Leak and Trouble ticket processes
A documented work order system has been established for all planned and repair tasks. Leak notifications have now been standardized and appear to be working as planned.
c) Perform Hydrology testing to measure aquifer health
Hydrology testing for aquifer supply and performance will be conducted this June on all 5 wells. The report, which will be available to all members, will be published in July.
d) Dispose of old water meters
The buyer that we were discussing a transaction with decided not to continue discussions after the COVID crisis hit. We are looking for alternatives.
e) Review System production and storage capacity
We located the report commissioned from Civiltech several years ago that answered all of the questions regarding capacity and storage.
- Business Goals stated at our January meeting:
a) Completion of Asset transfer from ICRWUA to ICWC (see #1 – above)
The noticed public hearing on July 6th is the next step in the process. We will communicate the time and location or call-in number as soon as we know them.
b) ICR well field 25-year term lease renewal
The lease renewal has been negotiated and is awaiting signatures. The rate change for the 2 leased wells on the ICR system will increase approximately 28% to $0.35/1000 gallons effective August 1st ,2020. It will remain at this rate for 25 years subject to annual inflation increases and any ACC rate case adjustments during that term.
c) Rate case preparation
We have engaged an experienced Utility CPA to perform preliminary estimates of a theoretical rate case based on last year’s operating data. Her report indicated that, based on some adjustments to contracts and numbers of water users, the proposed rate increase to the ACC would be approximately 11-12%. This is very modest considering that the last rate case was filed in 2009. Preparation of a formal rate case will commence this summer. There will be opportunities for members to review the rate case and its assumptions during the preparation process.
d) Evaluate Reserve strategy
We are evaluating both a contingency account for unanticipated repair or maintenance costs, and a long- term contingency fund for eventual replacement of fully depreciated assets. These are on hold pending the ACC decision, as we only want to implement the banking changes once. Several past board members will be asked their opinions on past vs present practices.
e) More transparency with website and written updates
A board member has taken over webmaster duties which has made it much faster and easier to update content on the site. Hopefully updates like this one and future public meetings will demonstrate the board’s commitment to transparency in all company activities.
- Other current items of interest
We are in the process of replacing the submersible pump equipment in TRR well #2. This unit has run almost continuously for 11 years and the motor and starter failed. Some repairs were made to the well interior during this project. We are also going out for bids to paint the Molly Way storage tank in TRR.
We have also conducted some needed cleanup of our banking arrangements. Several old accounts were costing us more in fees that they were paying in interest and so they were all consolidated. We have also switched all of our regular vendor payments to electronic payments. This has provided a much better audit trail and security for our finances. Deposit refunds will still be processed by paper check.
We have received the 2019 Consumer confidence reports from the ADEQ for both water systems. They are posted to the website under the Water Quality tab.
We have developed and approved a 2020 operating budget. This will also be posted to the website.
We will keep all members up to date on when the next public meeting will be scheduled. In the meantime, we hope this type of update is helpful. Feel free to contact the board through the website or by email if you have any feedback or questions.
Your Board of Directors,
ICR Water Users Association was formed as a non-profit water company in 1995.
At the time, the company served a territory including the Inscription Canyon Subdivision, under authority of and regulation by the Arizona Corporation Commission.
The water company is owned by members within the subdivisions it serves. It presently is governed by a five-member board of directors elected by the members. The board members are volunteers, elected for a two-year term. Day to day management, (including billing and accounting) and water systems operations are provided under contract agreements. The Association has no employees. Read more >>
Board of Directors
President: Bob Hilb
Vice President of Operations: Mark Armstrong
Secretary: Randy Joly
Treasurer: Giles Howard
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