PUBLIC SERVICE
COMMISSION
OF WEST VIRGINIA
CHARLESTON
At a session of the PUBLIC SERVICE COMMISSION OF WEST VIRGINIA in the City of Charleston on the 16th day of April 2024.
CASE NO. 23-0899-PWD-W-PC
TOMLINSON PUBLIC SERVICE DISTRICT and
THE NEWELL COMPANY
Joint petition for consent and approval of an asset purchase agreement
COMMISSION ORDER
The Commission revises the Notice of Filing and Proposed Change in Rates (Notice of Filing) and orders Tomlinson to publish the Notice of Filing.
BACKGROUND
On November 27, 2023, Tomlinson Public Service District (Tomlinson) and The Newell Company (Newell) (Collectively Applicants) filed a Joint Petition for the Commission’s consent and approval for Tomlinson to acquire the water utility assets of Newell pursuant to the November 14, 2023 Asset Purchase Agreement (Agreement).
On April 10, 2024, the Commission issued an Order that denied the Applicants’ request for a waiver of notice and ordered the Applicants to publish the Notice of Filing attached to the April 10, 2024 Order as Attachment A.
On April 12, 2024, the Applicants filed a letter (April 12 Letter) requesting that the Commission revise the Notice of Filing.
DISCUSSION
The April 12 Letter noted that the Water User Agreement between Fiesta Tableware Company (Fiesta) and Tomlinson contemplated that Fiesta would purchase “up to 8,333,333.33 gallons of water per month and up to 100,000,000.00 gallons of raw water annually.”1 The Water User Agreement further contemplated that the rate to be paid by Fiesta for raw water would be “the rate determined by
1 Joint Petition, Exhibit 4 at Bates 25. the Public Service Commission of West Virginia, which rate may be changed from time to time.” The Water User Agreement further provides that “Fiesta agrees to pay for all potable water service based upon Tomlinson’s current tariff on file with the PSC, which tariff may be changed from time to time.”3
The Commission notes that when it developed a reasonably descriptive notice there were no rates for Tomlinson other than its tariff rates and that neither Newell nor Tomlinson have a raw water rate in their tariffs. Furthermore, although the Water User Agreement contemplates that Fiesta will pay the Tomlinson tariff for potable water, there was no information submitted indicating the amount of potable water taken by Fiesta and the amount of production water or non-potable water taken by Fiesta. We also noted that Fiesta is currently paying Newell under its tariff, as opposed to a separate non-potable water contract, which would indicate that the system is currently engineered and designed to deliver only potable water to Fiesta.
The lack of information and detail, as well as the lack of even a proposed separate non-potable water rate for Fiesta, or any information explaining how Tomlinson is going to switch Fiesta from potable to non-potable water immediately upon closing of the acquisition or how it is going to charge a rate to be determined by the Commission immediately on closing, when no such rate has even been proposed effectively left the Commission with no choice but to develop the Notice which it did. The lack of information remains a concern. However, Fiesta should be aware that it will pay something other, and presumably less, than the Tomlinson tariff rate, even if it receives treated water for production purposes which Tomlinson will categorize as non-potable water under its Water User Agreement with Fiesta. Under these circumstances, notice to Fiesta is not necessary, and the notice to other customers can only divulge the proposed increases to those customers and be silent on the effect of the acquisition on Fiesta.
The Commission will revise the Notice of Filing attached to this Order as Attachment A to eliminate any reference to the monthly billings to Fiesta if the acquisition is finalized and to include only the statement that Fiesta will pay Tomlinson for an unknown amount of raw water at a rate to be determined and an unknown amount of treated water at the Tomlinson rates (which are higher than the Newell rates).
2 Id. at Bates 26-27.
3Id. at Bates 27.
FINDING OF FACT
The Applicants filed a letter requesting that the Commission revise the Notice of Filing.4
CONCLUSION OF LAW
The Commission should revise the Notice of Filing that was attached to the April 10, 2024 Order to reflect that the only industrial customer of Newell will pay Tomlinson for raw water at a rate that has yet to be established.
ORDER
IT IS THEREFORE ORDERED that the April 10, 2024 Order remains in full force and effect, except as modified by this Order.
IT IS FURTHER ORDERED that Tomlinson Public Service District shall immediately publish in a newspaper published and of general circulation in Hancock County, West Virginia, the Notice of Filing and Proposed Change in Rates attached to this Order as Attachment A.
IT IS FURTHER ORDERED that Tomlinson Public Service District shall file proof of publication in this docket within three days of the publication and no later than thirty days from the date of this Order.
4 April 12 Letter.
3
IT IS FURTHER ORDERED that the Executive Secretary of the Commission serve a copy of this Order by electronic service on all parties of record who have filed an e-service agreement, and by United States First Class Mail on all parties of record who have not filed an e-service agreement, and on Commission Staff by
hand delivery.
A True Copy, Teste,
Jane Buckley
Karen Buckley, Executive Secretary
JMB/ksf 230899ca
4
Attachment A
Page 1 of 3
CASE NO. 23-0899-PWD-W-PC
TOMLINSON PUBLIC SERVICE DISTRICT and
THE NEWELL COMPANY
Joint petition for consent and approval of
an asset purchase agreement
NOTICE OF FILING AND PROPOSED CHANGE IN RATES
On November 27, 2023, Tomlinson Public Service District (Tomlinson) and The Newell Company (Newell) (collectively Applicants) filed a petition for the Commission’s consent and approval for Tomlinson to acquire the water utility assets of Newell (Joint Petition). Tomlinson agreed to pay Newell $1,638,921 upon closing of the transaction. Tomlinson advised that it requested grants from the West Virginia Infrastructure and Jobs Development Council (WVIJDC) to fund the purchase price.
The Applicants proposed to apply Tomlinson’s current rates and charges for water to Newell’s former customers as of the closing date. The monthly bill for customers acquired by Tomlinson may increase between 40 percent at a zero usage minimum bill level and approximately 44 percent at a usage level of 3,400
gallons.
Current bills for Newell customers under the Newell Tariff and proposed bills under the Tomlinson Tariff, based on average monthly usage as reported by Newell, will change as follows:
Customer Class
Residential (2,700 gal)
% Increase
$15.08 $19.86
44%
34%
Current Proposed Increase $27.71 $44.81 Commercial (5,900 gal) $59.04 $78.90 The Applicants represented to the Commission that the current industrial customer of Newell (Fiesta Tableware Company) will be charged the Tomlinson rate for an undeterminable amount of potable water and will be charged a new rate for non-potable raw water for production purposes that has yet to be established.
Attachment A Page 2 of 3
Newell’s current water rates are:
RATES (Customers with metered water supply)
First
Next
Next
Next
Next
6,000 gallons used per quarter
$ 10.43 per 1,000 gallons
14,000 gallons used per quarter $ 9.79 per 1,000 gallons 80,000 gallons used per quarter $ 7.79 per 1,000 gallons 300,000 gallons used per quarter $ 6.51 per 1,000 gallons 600,000 gallons used per quarter $ 3.91 per 1,000 gallons
All over 1,000,000 gallons used per quarter $ 2.62 per 1,000 gallons
Minimum Bill – $62.58 for three months.
Tomlinson’s current water rates are:
RATES *
First
Next
$14.99 per 1,000 gallons
3,000 gallons used per month 3,000 gallons used per month $11.70 per 1,000 gallons Next 4,000 gallons used per month $10.28 per 1,000 gallons Next 10,000 gallons used per month $ 9.79 per 1,000 gallons All Over 20,000 gallons used per month $ 8.54 per 1,000 gallons
Minimum Bill – $43.41 plus $0.52 per thousand gallons used per month.
Tomlinson’s request to charge customers acquired by this transaction Tomlinson’s current rates is only a proposal that will be reviewed and may be modified by the Public Service Commission. Any increase in rates and charges will not become effective until approved by the Commission.
The Commission may conduct public comment and evidentiary hearings in this matter if substantial protests and/or petitions to intervene are received. If the Commission schedules a hearing in this matter, there will be a future Notice of the time and place for the hearing. Interested persons should monitor the Commission’s Web Docket for filings and future orders in this matter.
Attachment A Page 3 of 3
Anyone desiring to protest or intervene should file in writing as soon as
possible, but no later than thirty (30) days after the date of publication of this Notice, unless that requirement is otherwise modified by Commission order. Failure to timely protest or intervene can affect your right to protest or participate in future proceedings in this case. All protests or requests to intervene shall briefly state the reason(s) for the protest or intervention. Requests to intervene must comply with the Commission’s rules on intervention set forth in the Commission’s Rules of
Practice and Procedure.
The Commission’s rules are available via a link on the Commission’s Home
Page to the website of the West Virginia Secretary of State. All written comments and protests, requests to intervene, and requests for hearing must state the case name and number and be addressed to Karen Buckley, Executive Secretary, Post Office Box 812, Charleston, West Virginia 25323. Public comments may also be by clicking the “Formal Case” link
http://www.psc.state.wv.us/
scripts/onlinecomments/
default.cfm.
filed online at
TOMLINSON PUBLIC SERVICE DISTRICT
WDT Apr 23, 2024
Sponsored by ZMM Architects and Engineers