ACC APPROVAL OF CCN EXPANSION NOVEMBER 7, 2017 FALCON VIEW II & FALCON RIDGE.PDF

1
1111111110111111gpliff
BEFORE THE ARIZONA CORPORATION'
2 COMMISSIONERS Arizona Corporation commission
3 DOCKETED
TOM FORESE — Chairman
4 BOB BURNS NOV 0 7 2017
ANDY TOBIN
BOYD W. DUNN
JUSTIN OLSON
6
7 IN THE MATTER OF THE APPLICATION OF DOCKET NO. SW-01428A-17-0120
LIBERTY UTILITIES (LITCHFIELD PARK
8 WATER & SEWER) CORP. TO EXTEND ITS DECISION NO. 75437
CERTIFICATE OF CONVENIENCE AND
9 NECESSITY TO PROVIDE WASTEWATER
UTILITY SERVICE IN MARICOPA COUNTY,
10 ARIZONA. OPINION AND ORDER
II DATE OF HEARING: August 29,2017
12 PLACE OF HEARING: Phoenix, Arizona
13 ADMINISTRATIVE LAW JUDGE: Sasha Paternoster
14 APPEARANCES: Mr. Jay L. Shapiro, SHAPIRO LAW FIRM, P.C., on
behalf of the Applicant; and
15 Mr. Andy M. Kvesic, Chief Counsel, Legal Division, on
16 behalf of the Utilities Division of the Arizona
Corporation Commission.
17 BY THE COMMISSION:
18 On April 27, 2017, Liberty Utilities (Litchfield Park Water & Sewer) Corp. ("Liberty" or
19 "Company") filed with the Arizona Corporation Commission ("Commission") an application for an
20 extension of its current Certificate of Convenience and Necessity ("CC&N") to provide wastewater
21 utility service to include the Falcon Ridge and Falcon View 11 developments located in certain defined
portions in Maricopa County, Arizona.
23 On May 5, 2017, a Procedural Order was issued regarding consent to email service.
24 On May 30, 2017, the Commission's Utilities Division ("Staff") filed a Sufficiency Letter
25 stating Liberty's application had met the sufficiency requirements as outlined in the Arizona
26 Administrative Code ("A.A.C.").
27 On June 5, 2017, by Procedural Order, a hearing was scheduled to commence on August 29,
28
$ ‘SPoternosta-Walcr & SeweetOttOs'1701200&43 dacx 1

DOCKET NO. SW-01428A-17-0120
2017, and other procedural deadlines were established.
On June 9, 2017, Liberty filed a Consent to Email Service.
On June 13, 2017, by Procedural Order, Liberty's request for email service was approved.
On July 31, 2017, Staff filed its Staff Report recommending approval of Liberty's application,
subject to certain conditions.
On August 7, 2017, Liberty filed its Certification of Publication and Proof of Mailing, stating
that notice had been mailed and published in the West Valley View and Wesi Valley Business,
newspapers of general circulation in the proposed extension area.
On August 11, 2017, Liberty filed its Response to Staff Report stating that the Company
opposed two of Staff's recommendations that contain deadlines for compliance items. Liberty offered
several alternatives to the recommendations that the Company would find acceptable.
On August 29, 2017, the hearing in this matter was held as scheduled before a duly authorized
Administrative Law Judge of the Commission at its offices in Phoenix, Arizona. Liberty and Staff
appeared through counsel and no members of the public appeared to present public comment. The
parties presented evidence and testimony during the hearing. At the conclusion of the hearing, the
matter was taken under advisement pending submission of a Recommended Opinion and Order to the
Commission.
•
Having considered the entire record herein and being fully advised in the premises, the
Commission finds, concludes, and orders that:
FINDINGS OF FACT
Background
I. Liberty is an Arizona "C" corporation that provides public water and wastewater utility
service in communities within the cities of Litchfield Park, Goodyear, and Avondale. Liberty also
provides services in adjacent unincorporated areas of Maricopa County in the west Phoenix valley,
west of the Agua Fria River and north of Interstate Highway 10. Liberty has approximately 18,500
2 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
1 water customers and approximately 17,500 wastewater customers)
2. Liberty, an Arizona corporation, is owned by Liberty Utilities (Sub) Corp., a Delaware
3 corporation, through its operating subsidiary, Liberty Utilities Co. Liberty's ultimate parent,
4 Algonquin Power & Utilities Corp., is a Canadian corporation whose shares are traded on the Toronto
5 Stock Exchange. 2
6 3. On April 27, 2017, Liberty filed an application for an extension of its current CC&N to
7 provide wastewater utility service to the Falcon Ridge and Falcon View II developments located in
8 certain defined portions in Maricopa County, Arizona, the legal descriptions of which are set forth in
9 Exhibit A, attached hereto and incorporated by reference.
10 4. Liberty is requesting Commission approval to extend its wastewater CC&N to serve
11 Falcon Ridge, which is approximately 55.3 acres, and Falcon View II, which is approximately 9.84
12 acres.
13 5. Falcon Ridge is bound by Glendale Avenue on the north, Maryland Avenue on the
14 south, with 129th Avenue to the west, and 127 th Avenue to the east; and is contiguous to Liberty's
15 existing CC&N. The development will consist of 178 residential lots and be developed in two phases.
16 6. Falcon View II is contiguous to Falcon Ridge with its boundaries being 127` 11 Avenue
17 to the west, 126th Avenue to the east, between Glendale and Maryland Avenues. Falcon View II will
18 be constructed in a single phase with 22 residential lots at build out.
19 7. Both Falcon Ridge and Falcon View II are in an unincorporated area of Maricopa
20 County within Section 11 of Township 2 North, Range 1 West. The proposed extension areas are
21 within Valley Utilities Water Company's ("Valley Utilities") water CC&N making Valley Utilities the
11 water provider to the developments. 3
13 8. According to Liberty's application, all utility construction for both phases of the Falcon
24 Ridge development should be completed by September 2018 and construction for Falcon View II is
25 expected to begin in the fourth quarter of 2017. 4 Staff noted that the Falcon View H development will
26 r Exhibit S-1 at I.
17 2 Ex. S-1 at 1.
3 Ex. S-1 at I
28 4 At hearing, Liberty's witness testified that construction for Falcon View II would probably start sometime in 2018. Tr
at 15,
3 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
1 need to interconnect with Falcon View's sewer system which has been delayed, causing Falcon View
2 ll's construction schedule to be delayed. As a result, Staff recommended the following compliance
3 items: a copy of the Approval of Construction ("AOC") for Falcon View II by June 30, 2019; an AOC
4 for Falcon Ridge Phase I by December 31,2019; and documentation demonstrating that the first parcels
5 have been served in Falcon Ridge and Falcon View 11 by June 30, 2020. 5
6 9. In its response to the Staff Report, Liberty opposed Staffs recommendations that
7 require the Company to file AOCs for Falcon View II and Falcon Ridge by June 30, 2019 and
8 December 31, 2019, respectively, as well as the recommendation to file documentation upon serving
9 the first parcels in the developments. Instead, Liberty proposed the following alternatives: eliminate
10 the recommendations as unnecessary; maintain the recommendations but eliminate the deadlines; or,
11 as a last resort, extend the deadlines by two (2) years.
12 10. Liberty has received a request for service to provide wastewater service from EH CCF
13 Liberty, LLC and EH RKCF Liberty, LLC, the property owners of Falcon Ridge and Falcon View 11. 6
14 11. According to testimony, Liberty will equip each home with a sewer shutoff valve to
15 allow for shutoff in the event of the nonpayment of bills given the bifurcated water and wastewater
16 systems. 7
17 Existing/Proposed System
18 12. According to Staff's Engineering Report, Liberty owns and operates Casitas Bonitas
19 Lift Station ("Casitas Bonitas") and Palm Valley Water Reclamation Facility ("PVWRF"). PVWRF's
20 present treatment capacity was recently expanded to 5.8 million gallons per day ("MGD"). 8
21 13. Due to Casitas Bonitas' limited capacity, Casitas I3onitas would only be capable of
2, serving 35 lots in Falcon Ridge. Staff's Engineering Report determined that PVWRF has adequate
23 treatment capacity to serve the proposed extension areas. 9
24
25
26 $ Ex. S-1, Attachment A at 4.
17 6 Per Liberty's application, the Company and the property owners are not affiliated in any way. Tr. at 9.
7 Tr. at 19.
28 °Tr. at 17.
9 Ex. S-1, Att. A at 5.
4 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
1 14. Liberty submitted the proposed costs for wastewater facilities needed to serve the
2 requested extension areas. Liberty's projections estimate a total combined cost for Phases 1 and II in
3 Falcon Ridge and one phase in Falcon View II of approximately $798,685.
4 15. Liberty proposes to finance the facilities with a combination of contributions, advances,
5 and equity.
6 16. Staff concluded that Liberty's proposed costs to construct facilities needed to serve the
7 extension area is reasonable. However, Staff stated it did not make a "used and useful" determination
8 for the proposed plant-in-service and no conclusions should be inferred for ratemaking or rate base
9 purposes. 10
10 17. Liberty will charge its existing wastewater rates in the proposed extension area."
11 18. According to Staffs Engineering Report, Liberty has no delinquent Commission
12 compliance items. 12
13 19. An Arizona Department of Environmental Quality ('ADEQ") Compliance Status
14 Report dated May 3, 2017, indicated that PVWRF was in compliance for the period of January 1, 2016
15 to March 31, 2017. 13
16 20. Liberty has an approved Offsite Hookup Fee Tariff on file with the Commission."
17 21. Staff's Engineering Report stated that Maricopa County Environmental Services
18 Department ("MCESD") I5 has determined that Valley Utilities' water system is in compliance and is
19 currently delivering water that meets quality standards as determined by the A.A.C. I6
10 Staff's Recommendations
21 22. Staff initially recommended that Liberty be required to file AOCs for Falcon View 11
22 and Falcon Ridge by June 30, 2019 and December 31, 2019, respectively. Staff's initial
23 recommendation also included a requirement that the Company file documentation upon serving the
24 first parcels in the developments no later than June 30, 2020.
25 10 Ex. S-1, Att. A at 4.
26 "Lx. S-1 at 2.
12 Ex. S-1, Att. A at 5.
27 13 Ex. S-1, Att. A at 5.
" Ex. S-I at 2.
28 15 MCESD is the formally delegated agent of ADEQ.
16 Ex. 5-I, An. A at 2.
5 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
1 23. Liberty objected to these deadlines, stating such requirements were "duplicative,
2 regulatory overload,"" and offered several alternatives. At hearing, Staff agreed to Liberty's proposal
3 to extend the deadlines by two years.' 8
4 24. Staff is now recommending the Commission approve Liberty's application for
5 extension of its CC&N to provide wastewater in a portion of Maricopa County, Arizona, subject to
6 compliance with the following conditions:
7 I. Require Liberty to charge its existing rates and charges in the proposed extension area.
2. Require Liberty to file with Docket Control, as a compliance item in this docket, a copy
of the AOC for Falcon View II by June 30, 2021, and an AOC for Falcon Ridge Phase
1, by December 31, 2021.
3. Require Liberty to file with Docket Control, by June 30, 2022, documentation
demonstrating that the first parcels have been served in the Falcon Ridge and Falcon
1/ View H Developments.
13 4. Require Liberty to file with Docket Control, a copy of the county franchise agreement
14 for the extension area as a compliance item in this docket no later than June 30, 2019.
15 25. Staff further recommends that the Commission's Decision granting this extension of
16 CC&N to Liberty be considered null and void, after due process, should Liberty fail to meet conditions
17 Nos. 2, 3, and 4 within the time specified.
18 26. Staff's final recommendations are reasonable, and we will adopt them.
19 CONCLUSIONS OF LAW
20 1. Liberty is a public service corporation within the meaning of Article XV of the Arizona
21 Constitution and A.R.S. §§ 40-281 and 40-282.
/2 1. The Commission has jurisdiction over Liberty and the subject matter of the application.
23 3. Notice of the application was provided in accordance with law.
/4 4. There is a public need and necessity for wastewater service in the proposed extension
25 areas as set forth in Exhibit A.
26 5. Liberty is a fit and proper entity to receive a CC&N to provide wastewater service in
27
18 17 Ex. A-2 at].
11/ Tr. at 32, 38.
6 DECISION NO. 76437

DOCKET NO. SW-01428A- I 7-0120
the proposed extension areas.
6. Staff's final recommendations are reasonable and should be adopted.
ORDER
IT IS THEREFORE ORDERED that the application of Liberty Utilities (Litchfield Park Water
& Sewer) Corp. for an extension of its Certificate of Convenience and Necessity to provide wastewater
service in Maricopa County for that property described in Exhibit A attached hereto, is approved as
conditioned herein.
IT IS FURTHER ORDERED that Liberty Utilities (Litchfield Park Water & Sewer) Corp. shall
charge its authorized rates and charges in the extension area.
IT IS FURTHER ORDERED that Liberty Utilities (Litchfield Park Water & Sewer) Corp. shall
file with Docket Control, as a compliance item in this docket, a copy of the Approval of Construction
for Falcon View II by June 30, 2021, and an Approval of Construction for Falcon Ridge Phase 1, by
December 31, 2021.
IT IS FURTHER ORDERED that Liberty Utilities (Litchfield Park Water & Sewer) Corp. shall
file with Docket Control, by June 30, 2022, documentation demonstrating that the first parcels have
been served in the Falcon Ridge and Falcon View H Developments.
IT IS FURTHER ORDERED that Liberty Utilities (Litchfield Park Water & Sewer) Corp. shall
file with Docket Control, as a compliance item in this docket, a copy of the county franchise agreement
for the extension area as a compliance item in this docket no later than June 30, 2019.
7 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
1 IT IS FURTHER ORDERED that, if Liberty Utilities (Litchfield Park Water & Sewer) Corp.
2 fails to meet the above timeframes, the Arizona Corporation Commission's Decision granting the
3 extension of Liberty Utilities (Litchfield Park Water & Sewer) Corp.'s wastewater Certificate of
4 Convenience and Necessity be considered null and void, after due process.
5 IT IS FURTHER ORDERED that this Decision shall become effective immediately.
6 BY ORDER OF THE ARIZONA CORPORATION COMMISSION.
7
8
9
10
11 COMMISSIONER TO 1SSIONER OL N MMISVSIONER BURNS
12
13 IN WITNESS WHEREOF, I, TED VOGT, Executive Director of
the Arizona Corporation Commission, have hereunto set my
14 hand and caused the official seal of the Commission to be affixed
at the Capitol, in the City of Phoenix, this 4-1 day
15 of 1\-6.,112wiacr2- 2017.
16
17 TED VOGT
18 EXECUTIVE DIRUCTOR
19 DISSENT
20
21 DISSENT
22 SP/sa
23
24
25
26
27
28
8 DECISION NO. 76437

SERVICE LIST FOR: LIBERTY UTILITIES (LITCHFIELD PARK WATER
& SEWER) CORP.
2 DOCKET NO.: SW-01428A-17-0120
3
4 Jay Shapiro
SHAPIRO LAW FIRM, P.C.
5 1819 E. Morten Avenue, Suite 280
Phoenix, AZ 85020
6 Attorney for LIBERTY UTILITIES
(LITCHFIELD PARK WATER & SEWER) CORP.
Jayai.sllapslawaz.coin
8 whilnewwshapsiawaixonl
Thdd.Wilev(atibertvUtilities.com
9 I Consented to Service by Email
10 II Andy Kvesic, Director
Legal Division
liii ARIZONA CORPORATION COMMISSION
1200 West Washington Street
12 I Phoenix, AZ 85007
egall)k, toice.um,
13 I Liiiklivsen.icebvemail a azcc.gin
Consented to Service by Email
14
15
16
17
18
19
20
21
22
23
24
25
26
17
28
9 DECISION NO. 76437

DOCKET NO. SW-01428A-17-0120
EXHIBIT A
Legal Description
Liberty Utilities (Litchfield Park Water & Sewer) Corp.
Wastewater CC&N Extension
Parcel 1 — Falcon View II
The Southwest Quarter of the Northwest Quarter of the Northeast Quarter of Section 11,
Township 2 North, Range 1 West, of the Gila and Salt River Meridian, Maricopa County, Arizona.
Parcel 2— Falcon Ridge
The East half of the Northwest quarter of Section 11, Township 2 North, Range 1 West of the
Gila and Salt River Base and Meridian, Maricopa County, Arizona;
EXCEPT the North 65 feet;
EXCEPT the North 1,310 feet of the East 770 feet;
Also Excepting therefrom, that part of the Northwest quarter of Section 11, Township 2 North,
Range 1 West, of the Gila and Salt River Meridian, Maricopa County, Arizona, more particularly
described as follows:
Commencing at the Maricopa County Brass Cap marking the North Quarter corner of
said Section 11, from which the Maricopa County Department of Transportation Brass
Cap marking the Northwest corner of said Section 11 bears North 89° 02' 11" West, a
distance of 2,607.43 feet;
Thence North 89 02' 11" West, along the North line of the Northwest quarter of said
Section 11, a distance of 770.07 feet to a point on the West line of the East 770 feet of
the East half of said Northwest quarter, said West line being coincident with Parcel 1
and Parcel 2 as recorded in Instrument No. 94-0859174, Maricopa County Records;
Thence South 001.2' 08" West along said West line, a distance of 676.75 feet to the
TRUE POINT OF BEGINNING;
Thence continuing South 001.2' 08" West, along said West line, a distance of 100.00
feet;
Thence North sr 47' 52" West, departing said West line, a distance of 100.00 feet to a
point on a line which is parallel with and 100.00 feet Westerly, as measured at right
angles, from said West line;
Thence North 00'12' OS" East, along said parallel line, a distance of 100.00 feet;
Thence South 89' 4 7' 52" East, departing said parallel line, a distance of 100.00 feet to
the TRUE POINT OF BEGINNING.
DECISION NO. 76437

DOCKET NO. 5W-01418A-17-0120
lunsin
0/
•
.
•
tOlZI•bt
5
ae
5
1
0
tatatIMakaa
aA A
mum §-^ uutau
aluPn0A100 ,
min tmin
0 .„ 1„
n Jal 11.11. .131
Ng&
• um inTi41112,1M DIfilkixats0 tuo ••*:
1 • 41.
Lu1 rUn
)
7
snan
DECISION NO. 76437