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Show yr,y 1 Security Deposits Also Examined What Will MFS Reorganization Cost Ratepayers? PSC Asks V I By Con Psarras Tribune Staff Writer Public Service Commission Tuesday asked Mountain Fuel Supply Co., to provide a detailed explanation of how much money its recent corporate reorganization is going to cost ratepayers, beyond the $5 million passed into rates two weeks ago. And, in a regulatory doubleheader, the PSC also heard arguments on the effectiveness of Mountain Fuel's controversial policy for levying security deposits on customers who fall into arrears on their gas bills. The commission's concern over the effects of the company's federally-approve- d reorganization opened a broad scope of issues Tuesday, including a discussion of how the PSC will go about determining the way Mountain Fuel will spread its new rate structure among different classifications of customers. At the heart of the reorganization issue is the manner in which Mountain Fuel is now collecting its gas costs and general operating revenues structure, through its altered-rat- e which because of reorganization is now subject to regulaThe two-prong- tion. The reorganization involved the transfer of all authority for transmission of gas to a subsidiary which, because of its interstate operations, is subject to oversight of the Federal Energy Regulatory Commission (FERC). Rate Hike OKd Shortly after reorganization was in spite of opapproved by FERC PSC two other and the position by MounUtah regulatory agencies h tain Fuel applied for rate increase of $5.1 million, which the PSC approved and which went into effect July 1. Mountain Fuels decision to apply for the increase in the form of a passthrough rate hike has given rise to pass-throug- some confusion among regulators on the effects of the reorganization. h Thats because rate increases are traditionally used to balance utility account ledgers by accommodating changes in the cost of the gas the company is buying from independent suppliers and passing on to customers. But in this case, Mountain Fuel asked for a rate increase despite the fact that its gas costs were reduced by about $7 million during the period covered by the rate request. The reductions were largely the result of restructured contracts with independent gas suppliers. Mountain Fuel said a realignment of its rate structure as a result of the reorganization required a rate increase of about $13 million which, after subtracting the approximately $7 million in gas cost reductions, left the $5.1 million figure. The key issue now is how much of that $13 million is tied directly to shifting gas cost accounts in the wake of the reorganization and how much of it reflects an increase in operating costs that would typically be picked up in a general rate increase case, which are not tied to gas costs. In somewhat of an understatement, PSC Chairman Brent H. Cameron described the case as the subject of a good deal of confusion. He said the PSC wants to be fully apprised of the ramifications of the reorganization so it can satisfy public curiosity over whether the reorganization has been a good move for Mountain Fuel ratepayers. Difficult to Explain Its very difficult to explain to the general public how in order not to increase rates, weve had to increase rates, Mr. Cameron said. Mountain Fuel laywer Gary Sack-e- tt told commissioners that the company will submit to an audit of its books by the Utilities Division and the Committee of Consumer Services It Wasnt a Hurricane But Sandy Got Soaked By Eric McMullin Tribune Staff Writer SAND Tuesday afternoon was hot and sunny here, not unusual in the summer, but a far cry from the last two days, when this south valley city was the center of storms that one resident described as just like the television footage of hurricanes in Flori- Elsewhere, repairmen were putting finishing touches on power lines along 1300 East at 9600 South. Residents within the area of 9400 South to 10600 South between 1000 Blast and 1400 East had been without power for about six hours Monday evening after winds of up to 50 miles per hour toppled power lines. da. fwillow Creek Country Club was closed Tuesday after mothball-size- d hail and high winds knocked down trees and slightly damaged greens. More than one inch of rain fell in 20 minutes in each of the past two days, causing flash floods, fallen trees and downed power lines. Rain sent water down city rushing gutter-to-guttstreets, through lawns and into basements, while hail and high winds created havoc for residents and emergency personnel. No one was seriously injured although several traffic accidents were reported. Each of the storms was classified as a storm, meaning the city is not supposed to receive that much rain more than once every 200 years. 400 Years of Peace "I guess that gives us 400 years of peace, said a fireman, one of many who responded to more than 40 calls for assistance, mostly to help pump out flooded basements. For most of the citys residents, the storms were over almost as quickly as they began, and Tuesday afternoon, it was hard to imagine anything other than the standard lazy, sultry days of summer had occurred during the past 48 hours. Children were playing, residents were mowing lawns and it was business as usual at the malls. Closer inspection, however, revealed several telltale signs. Workers were replacing landscaping at the new Alpha mall, 10300 S. 1300 East, where shrubberies were washed into the streets and part of the sprinkler system found itself two feet above the ground as soil washed away from beneath. 200-ye- Beta-Skag- m, m. m. Wednesday, July 11, 1984 Section G Page that the state can determine if the transfer of assets from the former 1 Mr. Sackett, saying the company so agrees the PSC is "entitled to a detailed explanation of the effects of reorganization, suggested that the issue not be allowed to create a road- Transmission Division to Mountain Fuel Resources Inc., the subsidiary, has proceeded as planned. state dropped its opposition to the reorganization after FERC ruled in favor of the plan and after MounThe tain Fuel agreed to submit to such an audit and comply with other requests by Utah regulators. block in the final determination of whether the recent rate case was justified. Cost of Service Study pass-throug- h If an audit located a property The audit will be significant, officials say, because it is necessary to ensure that Mountain Fuel has not transferred assets to the subsidiary (subject to federal regulation) while also keeping them listed on ledgers subject to Utah regulation. By so doing, the company could double-colleon operating costs by persuading both regulatory agencies to grant rate relief to cover the same costs. ct OPEN DAILY rate-increa- tansfer that everyone agreed ought not to be transferred, that can be dealt with and worked out without holding up the rest of this case, Mr. Sackett said. Aside from the audit, the PSC has also asked Mountain Fuel to make information available on how it plans to distribute the rate burden among different classes of customers. Such information, which would involve a which are cost of service study MON.-FR- 10 I. ar P.1M. A.M.-- 9 7 DAYS ONLY SAT. e g SUN. NOON TO 6 10-- 6 30 DAY L These great values are good through Tuesday, July 17th the burden on customers who, if they are having a hard time meeting monthly payments, are going to be forced into further hardship by the additional security charge. CAP and Utah Issues also complain that the amount of the deposit is too large and that Mountain Fuel customer services representatives are failing to inform consumers that the deposits can be waived if their bills are brought current. The utilities ivision has recommended that the deposit be reduced to $100, and that half or all of it be levied before service is granted to a customer if that customer falls into certain "bad credit or unknown credit risk" categories. A deposit would not be required for service to customers with known credit histories Mountain Fuel has defended the current policy as having a salutory effect on the company's bad debt account. Since the policy went into effect last year, Mountain Fuel says it has realized a slight reduction in the amount of money it writes off each customers In preyear to vious years, that amount has steadily increased. Mr. Cameron asked all parties for data on how much of an effect the security deposit policy has had on that downswing in bad debt, which could also have been occassioned by an upturn in the economy and other factors. it charge increases EXCHANGE PRIVILEGE See Stores for detail. Ityjm Bme FuU Bme Includes mattress, foundation, Headboard. Includes mattress, foundation, Headboard. Ortho Rite Ortho Rite Mayor Lawrence P. Smith credited the citys runoff drainage system with limiting damage. Were really pleased with the way the storm system functioned. Without it, this might have become a disaster. Sandy is one of the hillier cities in the Salt Lake Valley and its runoff system utilizes flood plains as retention basins. Up to four feet of water stood Sunday in Buttercup Park, where some residents took impromp-- . tu canoe rides. Much Larger Pipes Costly of the water stayed for sev- eral hours in the retention basins, many of which are city parks. Water backs up because larger pipes flow weeim Size syo attressse U ESmg Size Ortho Ease Includes mattress, Ortho Ease Includes mattress, 2 foundation, Headboard. 1 foundations, Headboard. into the parks than flow out, said the mayor. The only alternative would be to install pipes large enough to handle any conceivable runoff and that would be No damage estimates were available, he said, adding that much of the damage was limited to several curbs and sidewalks and about one to two dozen private residences. Money for public repairs will come from the citys contingency funds, said the mayor. Also, several minor mudslides occurred as the rushing water played havoc with the sandy soil for which the city is named. Federal Judge Agrees to Rehear Clearinghouse Case Arguments By Charles Seldin Tribune Staff Writer One of the first Utah interpretations of a recent U.S. Supreme Court ruling that softened use of the "exclusionary rule will be decided by a federal judge, who Tuesday agreed to rehear arguments from the government in the Universal Clearinghouse case. Judge Aldon Anderson granted a motion filed by U.S. Attorney Brent Ward, who asked that the judge reconsider his earlier decision that quashed certain evidence obtained by the FBI in the clearinghouse probe. Judge Anderson said he would entertain memorandums on possible rule impact of the "exclusionary only, and would not hold complete hearings. The Supreme Court last week ruled that unlawfully seized evidence can be used against criminal suspects under certain circumstances. The ruling creates a good faith" exception to the courts own exclusionary rule. In effect, it means that when judges or magistrates make mistakes Sait akf Sri b unr pass-throug- used as a method of justifying a rate spread to customers who cost more .o serve than others should be held in conjunction with an annual, general proposal. Mountain Fuel has yet to subject sucii a rate increase this year, but Mr. Sackett said one may be in the works and may be filed within a couple of months if the company decides it needs higher rates. Ef the company doesnt file a general late request this year, the PSC said thei rate spread issue will be addressed in hearings tentatively set for next February. Separately, the PSC heard arguments by lawyers Tuesday in the ongoing case involving the use of security: deposits by Mountain Fuel and othur utilities to reduce the amount of i is uncollected bills. Tie Salt Lake Community Action Program and Utah Issues Inc., two pubhc action organizations, complained to the PSC that the Mountain Fuel! policy has generated a large number of complaints from consumers vrho were tagged with $120 deposits after failing to pay their bills for two or three months. The company levies such a deposit for Customers of at least one-yestanding who fall behind on bills by 90 days and on customers of less standing xho are in arrears for 60 days. Tile principal complaint of the two gron'ps is that the timing ofjhe depos Sofas fit Sleepers Everyday low factory direct prices mean youll always save 40jto 60 over department and furniture store list prices. warrants, the evidence seized by police may be used at trial as long as the officers had reason to believe the warrants were val- Adjustable Beds in issuing search MATTRESS id. In the case, the FBI had obtained a court order to tap telephones of sevled by clearingeral defendants house mastermind Richard T. 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