TARIFF RELATED ISSUES

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TARIFFRELATED ISSUES
PUBLIC SERVICE COMMISSION
FRANKFORT ONE-DAY SESSION

2008 WATER TRAINING SEMINAR

• DECEMBER

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BRENT KIRTLEY TARIFF BRANCH MANAGER
I
J
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TOPICS TO DISCUSS
PUBLIC SERVICE COMMISSION

• What is a Tariff
• What is in a Tariff
• How to file a Tariff
• Frequently Asked Questions
• Tariff Info on the PSC Website

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• WHAT
• IS
• A
• TARIFF?

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TARIFFS
PUBLIC SERVICE COMMISSION

• Schedule(s) showing all rates and conditions of
  service established by a utility and collected or
  enforced by the utility plus any additional
  attachments utilized.

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TARIFFS
PUBLIC SERVICE COMMISSION

• Any filed rate, charge, and /or condition of
  service approved by the governing regulatory
  agency shall be considered reasonable and
  unassailable in
  judicial proceedings.

FILED RATE DOCTRINE
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TARIFF RELATED LAWS
PUBLIC SERVICE COMMISSION

• KRS 278.160 (1) and (2)
• 807 KAR 5011 Section 3 (5) (a)
• 807 KAR 5006 Section 5 (1) and (2)

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PURPOSE OF THESE LAWS
PUBLIC SERVICE COMMISSION

1. Ensures PSC review of a utilitys rates, rules,
   conditions of service, and any other procedure.
2. Prevents discrimination by mandating uniform
   treatment to similarly situated customers.

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EFFECT OF THESE LAWS
PUBLIC SERVICE COMMISSION

• Utilitys tariff has the status of law.
• Can be varied only by law - not an act of the
  parties.
• Utility may file new tariffs to change its rates,
  but the utility lacks the legal authority to
  deviate from its filed tariff.

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VIOLATION OF THESE LAWS
PUBLIC SERVICE COMMISSION

1. Refund of Amounts Improperly Billed and
   Collected.
2. Penalties Against the Water District and its
   Commissioners and /or Superintendent.
3. Removal of Water District Commissioners
4. Civil Liability for Damages for Wrongful Denial
   of Service.

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SUMMARY OF THESE LAWS
PUBLIC SERVICE COMMISSION

1. If a fee is not in your tariff, you cannot charge
   it.
2. If a requirement is not in your tariff, you
   cannot impose it.
3. If a rule is not in your tariff, you cannot
   enforce it.

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• WHAT
• IS IN
• A
• TARIFF?

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TARIFFS
PUBLIC SERVICE COMMISSION
Municipal Water Utilities

• ALL Rates and Charges including
• Any Monthly Capital Cost Charge
• Any additional fees such as the Kentucky River
  Authority withdrawal fee.

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TARIFF
PUBLIC SERVICE COMMISSION
Water Districts Associations and Privately
Owned Water Utilities

• Rates / Charges
• Conditions of Service / Rules
• Additional Attachments

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TARIFF
PUBLIC SERVICE COMMISSION
Water Districts Associations and Privately
Owned Water Utilities

• Rates / Charges
• Monthly Rates for Water
• Meter Connection/Tap-on
• Non-recurring Charges
• Leak Adjustment Rate

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TARIFF
PUBLIC SERVICE COMMISSION
Water Districts Associations and Privately
Owned Water Utilities

• Conditions of Service
• Billing, Billing Adjustments, Meter Reading
  Info
• Termination of Service Policy
• Extension Policy
• Deposit Policy

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TARIFF
PUBLIC SERVICE COMMISSION
Water Districts Associations and Privately
Owned Water Utilities

• Attachments
• Water Shortage Response Plan
• Water Service Contract
• Partial Payment Agreement
• Sample Bill

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• SPECIAL
• ITEMS THAT
• SHOULD BE
• IN YOUR TARIFF

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• VOLUNTEER
• FIRE DEPARTMENT
• POLICY

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FIRE DEPARTMENTS
PUBLIC SERVICE COMMISSION

• KRS 278.170 (3) A water utility may grant free
  or reduced rate service for fighting fires or
  training
• 807 KAR 5095 Section 9 A water utility that
  allows a fire department to withdraw water shall
• Require usage reports
• Assess a penalty for failure to file

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FIRE DEPARTMENTS
PUBLIC SERVICE COMMISSION

• If a water utility has implemented such a policy
  it must be included in the tariff on file at the
  PSC.

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FIRE DEPARTMENTS
PUBLIC SERVICE COMMISSION

• The non-reporting user shall be billed for this
  usage at the lowest usage block rate regardless
  of customer classification that the utility
  charges.

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FIRE DEPARTMENTS
PUBLIC SERVICE COMMISSION

• A non-reporting user shall also be assessed a
  penalty of ____________ for each failure to
  submit a report in a timely manner.

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• LEAK
• ADJUSTMENT
• POLICY

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LEAK ADJUSTMENTS
PUBLIC SERVICE COMMISSION

• A utility may choose to offer a leak adjustment.
• If leak adjustments are made, there must be a
  written policy in your tariff to ensure that
  everyone is treated equally.

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LEAK ADJUSTMENTS
PUBLIC SERVICE COMMISSION

• The amount of gallons flowing through the meter
  should never be adjusted.
• Any adjustment should always be done on the
  monetary side, not the usage side.
• Any adjustment must cover the cost of the water.

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LEAK ADJUSTMENT POLICY
PUBLIC SERVICE COMMISSION
SUGGESTIONS FOR A

• The customer should make the request in writing.
• The bill should be the average monthly bill plus
  the reduced leak adjustment rate for all
  additional water that flowed through the meter.
• The reduced rate must cover the cost of the
  water.
• May limit the number of adjustments over a period
  of time.

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• ALL
• CONTRACTS

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CONTRACTS
PUBLIC SERVICE COMMISSION

• Every utility shall file true copies of all
  special contracts entered into governing utility
  service which set rates, charges, or conditions
  of service not included in its general tariff.

807 KAR 5011 Sec 13
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CONTRACTS
PUBLIC SERVICE COMMISSION

• Examples of Special Contracts
• Special Arrangements with Subdivision Developers
• Large industrial customers
• Wholesale customers

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CONTRACTS
PUBLIC SERVICE COMMISSION
Check to make sure that all your contracts for
providing water service have been filed with the
PSC. Check to see if they have the PSC stamp.
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• HOW DO
• I FILE A
• NEW
• TARIFF?

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Procedures for TARIFF FILINGS
PUBLIC SERVICE COMMISSION

1. A Letter explaining the requested Tariff changes.
2. A Signed Tariff Sheet with a proposed effective
   date that provides at minimum a 30-Day notice.
3. If applicable -- a copy of the Public Notice
   along with any supporting documentation.

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Procedures for TARIFF FILINGS
PUBLIC SERVICE COMMISSION

• PSC must act on a properly filed tariff prior to
  proposed effective date.
• Action Accept, Reject, or Suspend for 5-Months.
• If suspended for 5-months, and PSC fails to issue
  a decision prior to the end of the suspension,
  then the utility can place the tariff into effect
  subject to refund or modification.

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Procedures for TARIFF FILINGS
PUBLIC SERVICE COMMISSION

• PSC must issue a final decision within 10-months
  of the filing of the tariff.
• If the PSC fails to act before the expiration of
  the 10-month period, the tariff becomes effective
  by operation of law.
• See 807 KAR 5011 for detailed tariff
  information.

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• FREQUENTLY
• ASKED
• QUESTIONS

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• WHEN CAN WE PUT OUR NEW RATES INTO EFFECT
• ?

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EFFECTIVE DATE
PUBLIC SERVICE COMMISSION

• For example
• The effective date on the Tariff states
  September 20.

• This does not mean for bills issued on and after
  September 20.
• Instead, it means water that flows through the
  meter on and after September 20.

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• WHEN CAN
• WE
• DISCONNECT
• SERVICE
• ?

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TERMINATION OF SERVICE
PUBLIC SERVICE COMMISSION

• FOR NON-PAYMENT
• Utility must give five days written notice of
  intent to terminate for nonpayment
• Service cannot be terminated before twenty (20)
  days after the mailing date of the original bill

807 KAR 5006 Section 14
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• CAN WE ASSESS A
• SERVICE CHARGE
• FOR
• BANK DRAFTS
• OR
• CREDIT DEBIT
• CARDS?

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CREDIT CARDSERVICE CHARGE
PUBLIC SERVICE COMMISSION

• Check any and all agreements and contracts.
• Most prohibit this practice.

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• HOW CAN I
• DETERMINE IF
• THE TARIFF ON
• FILE AT THE
• UTILITY OFFICE
• IS CORRECT?

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IS THE TARIFF CORRECT?
PUBLIC SERVICE COMMISSION

• Go to the PSC website.
• Call the Tariff Branch.

• What should I do if the PSC version differs from
  the utilitys version?
• Call the Tariff Branch as soon as possible.

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• CAN WE
• INCREASE
• OUR
• DEPOSIT
• ?

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DEPOSITS
PUBLIC SERVICE COMMISSION

• Monthly 2/12 Customers Actual
• Bimonthly 3/12 or Estimated
• Quarterly 4/12 Annual Bill

807 KAR 5006 Sec 7
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• WHAT
• TARIFF
• INFORMATION
• IS ON
• YOUR
• WEBSITE
• ?

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PUBLIC SERVICE COMMISSION
www.psc.ky.gov
WEBSITE TARIFF INFO
T F S Tariff Filing System -----------------------
---- Individual Tariff filings that add new pages
or revise existing pages. Contract filings are
also in the system.
Online Tariffs ---------------------- Entire
Tariffs Contracts Water Shortage Response
Plans Municipals
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• HOW DO I
• FIND THIS
• TARIFF
• INFO ON
• YOUR
• WEBSITE
• ?

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• TARIFF
• FILING
• SYSTEM
• (TFS)

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• ONLINE
• TARIFF
• SYSTEM

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Final Points
PUBLIC SERVICE COMMISSION
TARIFF PRESENTATION

• Check with all utility staff to make sure that
  every rate, rule, policy, and condition of
  service is included in your tariff.
• Check to see that all your contracts have been
  filed with the PSC.
• Check to see if you are losing money on your
  non-recurring charges.

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Final Points
PUBLIC SERVICE COMMISSION
TARIFF PRESENTATION

• If you have any doubt about implementing a new
  rate or procedure, please call us and ask for
  verification that the rate or procedure can be
  put into effect.
• Call us with any questions.

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Questions??
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Brent Kirtley
PUBLIC SERVICE COMMISSION

• MANAGER

TARIFF REVIEW BRANCH
dbkirtley_at_mail.state.ky.us [phone] ext.
269
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TARIFFRELATED ISSUES
PUBLIC SERVICE COMMISSION
FRANKFORT ONE-DAY SESSION

2008 WATER TRAINING SEMINAR

• DECEMBER

10
BRENT KIRTLEY TARIFF BRANCH MANAGER
I
J