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r <br />r State of Florida <br />P <br />wry pe <br />Commissioners: o <br />GERALD L. (JERRY) GUNTER, CHAIRMAN <br />JOSEPH P. CRESSE ` r <br />SUSAN WAGNER LEISNER •'+ <br />_JOHN R. MARKS, III a00�`1,11) <br />KATIE NICHOLS <br />Pub[M`6erbice <br />January 12, 1984 <br />Mr. Joseph Baird <br />Assistant Utilities Director <br />Indian River County <br />P.O. Box 1750 <br />Vero Beach, Florida 32960 <br />DALE A. KNAPP, C.P.A. <br />Director <br />Water and Sewer Department <br />(904) 488-8482 <br />RE: INVESTOR UTILITY RATE REGULATION - DEPRECIATION OF CONTRIBUTED <br />ASSETS <br />Dear Mr. Baird: <br />This is to confirm our telephone conversation wherein I stated <br />the Florida Publiz Service Commission -does not allow the inclusion <br />of depreciation on contributed assets as an operating expense for <br />rate making purposes. This is specifically prohibited by statute <br />367.081, a copy of which is enclosed. <br />The above statute has been in effect for some 3� years. Prior <br />to that time, the Commission disallowed such depreciation expense as <br />a matter of policy from mid -1978 up until the time of the effective <br />date of the statute. Prior to their action in 1978, the Commission <br />did as a matter of policy allow depreciation on contributed assets. <br />Should you have any further questions, please feel free to <br />contact me. <br />Sincerely, <br />/�_ 1/v L,- ' V <br />Dale A. Knapp, .P.A. <br />Director <br />Water and Sewer Department <br />Assistant Intervener Eben Cockley asked that a letter <br />to Hutchinson Utilities, Inc., from Coopers & Lybrand signed <br />by Myron Olstein and dated December 5, 1983, be entered as <br />Intervener's Exhibit #7, attached to letter of Testone, <br />Marshall & Discenza and accompanying Statement of Financial <br />Position of Hutchinson Utilities, Inc., as of December 31, <br />1981, marked Intervener's Exhibit #8. <br />48 <br />BacK 55 ��,c1-953,. <br />