§ 126-126. Pass through rate adjustments.

The Franchisee shall file a verified notice, as set forth below, seeking any proposed change (increase or decrease) in rates pursuant to this subsection with County Staff no later than 75 days prior to implementation of the requested rates. The requested change in rates shall be the result of increases or decreases in the charges for purchased water, wastewater treatment, or electric power, the amount of taxes or assessments levied against its property, or the imposition of any new charges, including any new testing requirements, by any regulatory agency. The request shall be considered by the Board following a review of the verified notice. The new rates requested shall reflect, on an annualized basis, amount of the change of the taxes, assessments or other increases or decreases in the charges imposed upon the Franchisee. A Franchisee may not use this procedure if the amount due for the increase in charges was initially received by Franchisee more than 16 months prior to the filing of the verified notice.

(a)

The verified notice shall include an affirmation under oath as to the accuracy of the figures and calculations of the Franchisee upon which the change in rates is based, stating that the change will not cause the Franchisee to exceed its last Board-authorized rate of return or, if no Board-authorized rate of return exists, the Franchisee shall calculate a rate of return using the FPSC's current equity leverage formula and submitted to County Staff for substantiation.

(b)

If the adjustment in rates is based upon an increase or decrease in the charges for purchased water, wastewater treatment or electric power, the verified notice to the Board shall include the following:

(1)

A copy of the order, ordinance or other evidence whereby the rates for purchased water, wastewater treatment or electric power have been increased or decreased by the supplier;

(2)

A schedule showing, by month, the charges for purchased water, wastewater treatment or electric power purchased by the Franchisee for the most recent 12-month period, the charges that would have resulted had the new purchased water, wastewater treatment or electric power rates been applied, and the difference between the charges under the old rates and the charges under the new rates; and

(3)

A statement outlining the measures taken by the Franchisee to minimize or conserve water, wastewater or electric power.

(c)

If the adjustment in rates is based upon an increase or decrease in taxes or assessments, the verified notice to the Board shall include the following:

(1)

A copy of the tax bills which increased or decreased the taxes or assessments and copies of the previous three years' bills; and

(2)

A calculation of the amount of taxes and assessments related to that portion of the water or wastewater plant not used and useful in providing utility service.

(d)

If the adjustment in rates is based upon an increase in the costs that have been incurred for testing required by a regulatory agency, the verified notice to the Board shall include the following:

(1)

A copy of the order, ordinance or other evidence which establishes that the costs incurred for testing required by the applicable regulatory agency have been increased; and

(2)

A schedule showing the computation of the additional costs not already reflected in the rates of the Franchisee.

(e)

The verified notice to the Board shall also include the following:

(1)

A schedule showing how the proposed rates are calculated. The proposed rates must pass through the changes in a fair and nondiscriminatory manner;

(2)

A copy of the notice to customers required by subsection (6) of this section;

(3)

The affirmation required by subsection (1) of this section; and

(4)

The rate of return that the Franchisee is affirming it will not exceed, pursuant to subsection (1) of this section.

(f)

In order for the Board to verify whether a Franchisee, which has requested a pass-through rate adjustment, may exceed the last Board-authorized rate of return or the rate of return calculated in subsection (a) above, the Board may require a Franchisee to file such other information as it may deem relevant under the particular circumstances.

(g)

Not less than ten days prior to the time a customer begins consumption at the adjusted rates, the Franchisee shall notify each customer, by first-class U.S. mail, of the increases or decreases authorized and explain the reasons for the increases or decreases.

(h)

No Franchisee shall file for a pass through rate adjustment unless the Franchisee has on file with the Board a current Annual Financial Report as required by Section 126-116 and the Franchisee is current in the payment of its Franchise administration fees.

(i)

Following the implementation of a pass through rate adjustment, if upon review of the Franchisee's next two Annual Financial Reports, County Staff finds that the Franchisee exceeded its rate of return pursuant to subsection (a) above, the Board may, after a public hearing, order the Franchisee to refund to the rate payers a portion of the rate adjustment, with interest, calculated back to the date the rate adjustment was effective and adjust its rate accordingly.

(j)

A Franchisee may not file for a pass through rate adjustment pursuant to this section more than two times in any 12-month period. If filed during the pendency of a full rate case, the automatic implementation of rate change set forth in Section 126-133 will be stayed.

(Ord. No. 2016-041, § 2, 9-21-2016)