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figures come from. Therefore, we have the land, the wells, the <br />plant, the lines, the generator and some improvements which were <br />made subsequent to the purchase from Mr. Karr. Mr. Hunsberger <br />next addressed the "contributions in aid of construction (CIACs) <br />and explained that this plant was sized to service that <br />particular development consisting of 111 lots, of which 24 are <br />vacant. Since the Utility built more plant than is needed to <br />service the existing 87 customers, he calculated the "Used & <br />useful adjustment at 11.7%, making a negative adjustment of <br />$14,973. After Dr. Wilson and his partners took ownership, they <br />collected 17 connection fees at $750 each, which amounts to <br />$12,750, which is amortized at $1,377. At the time of the <br />purchase, Mr. Karr told the new owners that he had not collected <br />any connection fees. Mr. Hunsberger introduced as evidence an <br />affidavit to that fact. The County Utility staff pointed out <br />that they should have collected connection fees according to the <br />approved franchise tariff. Therefore, in compromise with the <br />staff, they have inputed these fees as if they had been <br />collected. This has reduced the Utility's rate base <br />considerably. He pointed out that CIAO can be either cash or <br />other things, but in this case it is only cash, and they have <br />imputed the connection fees to the detriment of the Utility of <br />the net of $52,500 and $10,694, which has hurt the Utility's rate <br />base of over $40,000. Then there is the "Net Utility Plant used <br />and useful" figure of $59,826. In rate cases, the standard <br />working capital allowance is one-eighth of the operating <br />expenses. This Utility's rate base is calculated at $63,386, <br />which is the amount at which the Utility should be allowed to <br />earn a fair rate of return under the County's ordinances. <br />7 <br />OV 8 w84 BOOK <br />