PSC-36-08-00011-P Ownership of Water Company Assets, Status as a Water Company and Failure to Take Steps to Allow for the Attainment of Financing

9/3/08 N.Y. St. Reg. PSC-36-08-00011-P

NEW YORK STATE REGISTER

VOLUME XXX, ISSUE 36

September 03, 2008

RULE MAKING ACTIVITIES

PUBLIC SERVICE COMMISSION

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. PSC-36-08-00011-P

Ownership of Water Company Assets, Status as a Water Company and Failure to Take Steps to Allow for the Attainment of Financing

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed Action:

The Commission is considering whether to issue an order to show cause to Ridge Associates, LLC regarding its ownership of water company assets, its status as a water company and its failure to take steps to allow for the attainment of financing for need.

Statutory authority:

Public Service Law, sections 2(26), (27), 89(b), (c)

Subject:

Ownership of water company assets, status as a water company and failure to take steps to allow for the attainment of financing.

Purpose:

Issuance of an order to show cause.

Substance of proposed rule:

In 1972, the principals of the Minisink Valley Utility Corporation sold the real property on which the water system was located to Ridge Associates, LLC (Ridge). This sale was made without the approval of the Public Service Commission. Since that time, the Minisink Valley Utility Corporation declared bankruptcy and the Pheasant Hill Water Corporation (Pheasant Hill), a collection of customers of the water system, has been appointed operator of the water system.

The system is in need of serious repair and improvements. Pheasant Hill has arranged for a grant and loan to finance the work, but it must pledge the system's real property as collateral on the loan. However, because the land is now owned by Ridge, this cannot be done.

Department of Public Service Staff (Staff) has contacted Ridge regarding the situation, explaining the need for the return of the improperly transferred property and that its ownership of water system assets places it under the jurisdiction of the Public Service Commission. While Ridge has not refused to return the needed land, its responses have been dilatory and Pheasant Hill faces a March 2009 deadline for finalizing financing.

Because of these facts, the Public Service Commission is considering whether to issue an order to show cause to Ridge, demanding an explanation why it should not be considered a water company under the Commission's jurisdiction, so that any necessary steps can be taken to ensure the continuing viability of the system.

Text of proposed rule and any required statements and analyses may be obtained by filing a Document Request Form (F-96) located on our website http://www.dps.state.ny.us/f96dir.htm. For questions, contact:

Leann Ayer, Public Service Commission, 3 Empire State Plaza, Albany, New York 12223-1350, [phone], email: [e-mail]

Data, views or arguments may be submitted to:

Jaclyn A. Brilling, Secretary, Public Service Commission, 3 Empire State Plaza, Albany, New York 12223-1350, [phone], email: [e-mail]

Public comment will be received until:

45 days after publication of this notice.

Regulatory Impact Statement, Regulatory Flexibility Analysis, Rural Area Flexibility Analysis and Job Impact Statement

Statements and analyses are not submitted with this notice because the proposed rule is within the definition contained in section 102(2)(a)(ii) of the State Administrative Procedure Act.

( 99-W-1572SA2)