It appears likely that the Residential Utility Consumer Office will appeal a portion of the Chaparral City Water Company rate case by the end of this week.

Dan Pozefsky, chief counsel for RUCO, said that the Corporation Commission has already discussed the CCWC case at a staff meeting and decided not to reopen the case.

“I am still going to wait the full 20 days – I have that marked as August 22,” Pozefsky said. “We are appealing SIB cases we have been involved with, so I do not know why we would not do the same here.”

Earlier this month RUCO filed an appeal in a case in which the ACC granted an SIB program to Arizona Water Company.

RUCO and the Town of Fountain Hills had formally applied to the Arizona Corporation Commission to rehear the CCWC rate increase. The commission had awarded CCWC and its parent company EPCOR an increase of about 18 percent in its base rate.

During the rate hearings EPCOR asked for consideration of a System Improvement Benefits (SIB) program, which allows the company to add costs for completed improvements to customer rates prior to the company’s next rate hearing with the ACC.

The ACC granted the SIB program.

The SIB, according to an analysis by the town’s legal firm, is designed to allow the company to recover “pre-tax return on investment and depreciation expenses associated with water infrastructure improvements and plant retirements.”

This plan was submitted for review with CCWC planning to complete the improvements prior to its next rate case.

The proposed SIB projects are subject to a “usefulness and prudency review” in the next rate case, which the commissioners ordered CCWC to file prior to June 1, 2018.

The generic list of items related to water infrastructure for which CCWC may recover costs using the SIB formula include supply mains, mains, services, meters and meter installations and hydrants.

All SIB projects must be reviewed by ACC staff and approved by the commission before being included in the surcharge.

SIB projects must be complete and placed in service prior to being included in the surcharge.

There is a surcharge cap which limits the annual SIB surcharge to 5 percent of the revenue requirement authorized by the ACC decision.

CCWC may not request an SIB surcharge for at least 12 months, and the firm is limited to a single request every 12 months.

In his formal filing for a rehearing, Pozefsky said the ACC decision for the rate increase offers little consideration for ratepayers.

“In RUCO’s view it is a decision which favors the (company) shareholders at the expense of ratepayers,” Pozefsky said.

At the regular council session on Aug. 4, the Town Council informally agreed to support RUCO in its efforts to have the case reheard or in the appeal process.