report and recommendations on customer growth …

Docket: Exhibit Number Commissioner Administrative Law Judge Public Advocates Office Witness

: : : : :

A.20-07-012 Cal Advocates - ____ G. Shiroma C. Ferguson E. Odell

REPORT AND RECOMMENDATIONS

ON CUSTOMER GROWTH FACTORS AND GSWC’S LOW INCOME ASSISTANCE PROGRAM

Application 20-07-012

San Francisco, California February 16, 2021

i

MEMORANDUM 1 2

The Public Advocates Office at the California Public Utilities Commission (“Cal 3

Advocates”) examined requests and data presented by Golden State Water Company (“GSWC”) 4

in Application (“A.”) 20-07-012 (“Application”) to provide the California Public Utilities 5

Commission (“Commission”) with recommendations that represent the interests of ratepayers 6

for safe and reliable service at the lowest cost. This report is prepared by Eileen Odell, who also 7

serves as Cal Advocates’ project lead for this proceeding. Victor Chan is the oversight 8

supervisor and Shanna Foley and Jamie Ormond are legal counsel. 9

Although every effort was made to comprehensively review, analyze, and provide the 10

Commission with recommendations on each ratemaking and policy aspect of the requests 11

presented in the Application, the absence from Cal Advocates’ testimony of any particular issue 12

does not constitute its endorsement or acceptance of the underlying request, or of the 13

methodology or policy position supporting the request. 14

i

Table of Contents Memorandum ..................................................................................................................... i Executive Summary .......................................................................................................... iii

I. Introduction ........................................................................................................... iii II. Summary of Recommendations ............................................................................ iii

A. Chapter 1: Customer Growth Factor ................................................................. iii B. Chapter 2: Low Income Assistance Program .................................................... iii

Chapter 1: Customer Growth Factor .............................................................................. 1

I. Introduction ............................................................................................................ 1

II. Summary of Recommendations ............................................................................. 1

III. Discussion .............................................................................................................. 2

A. The Commission Should Reject GSWC’s Use of Customer Growth Factors to Increase Test Year O&M and A&G Expense Forecasts as Adoption Would Likely Overcompensate GSWC for Its Costs. ........................................................................ 2

B. The Commission Should Reject GSWC’s Use of Customer Growth Factors to Increase Test Year District Labor Expense Forecasts as GSWC’s Methodology Would Likely Overcompensate GSWC for Its Costs .................................................. 5

IV. Conclusion ............................................................................................................. 6

Chapter 2: Low Income Assistance Program ................................................................. 8

I. Introduction ............................................................................................................ 8

II. Discussion .............................................................................................................. 9

A. Correcting an Error in CARW Credit Calculation ........................................... 10

III. Conclusion ........................................................................................................... 10

Attachment 1-1: Statement of Qualifications ............................................................... 11

Attachment 1-2: GSWC Response to Public Advocates Data Request CR8-001, Q.4 ........................................................................................................................................... 13

Attachment 1-3: GSWC Response to Public Advocates Data Request SLM-005, Q.2 ........................................................................................................................................... 17

Attachment 2-1: GSWC Response to Public Advocates Data Request EO2-003, Q.2 ........................................................................................................................................... 19

iii

EXECUTIVE SUMMARY 1 2

I. Introduction 3

This report presents Cal Advocates’ analysis and recommendations related to GSWC’s 4

use of customer growth factors to increase test year operations and maintenance (“O&M”), 5

administrative and general (“A&G”), and payroll expenses in its districts. Cal Advocates’ 6

primary testimony and recommendations on O&M can be found in the Public Advocates Office 7

Report and Recommendations on Operations and Maintenance and Supply Expenses. Cal 8

Advocates’ primary testimony and recommendations on A&G and labor can be found in the 9

Public Advocates Report on District A&G Expenses, District Labor Expenses, Conservation 10

Expenses and Special Request 4. 11

This report also provides Cal Advocates’ analysis and recommendations concerning 12

GSWC’s low income assistance program. 13

14

II. Summary of Recommendations 15

A. Chapter 1: Customer Growth Factor 16 The Commission should adopt Cal Advocates’ forecasts for test year O&M, A&G, and 17

payroll expenses, as Cal Advocates’ forecasts do not incorporate customer growth factors to 18

increase test year budgets. The use of customer growth factors to increase test year budget 19

forecasts would likely overcompensate GSWC for its costs and should be rejected. 20

21

B. Chapter 2: Low Income Assistance Program 22 The Commission should authorize GSWC to continue its existing California Alternative 23

Rates for Water (“CARW”) low income assistance program. However, the Commission’s final 24

decision in this case should correct an error made in GSWC’s workpapers supporting its 25

proposed credits for its low income assistance program. 26

27

1

CHAPTER 1: CUSTOMER GROWTH FACTOR 1 2

I. Introduction 3

GSWC requests adoption of test year budgets for Operations and Maintenance 4

(“O&M”),1 Administrative and General (“A&G”), and labor expenses in GSWC’s 5

ratemaking areas (“RMAs”) based on historical costs increased by various escalation 6

factors, including customer growth factors. GSWC’s methodology of including customer 7

growth factors assumes that a wide range of expenses increase at the same rate as 8

customer growth, without including support for this assumption. 9

The Commission’s Rate Case Plan does not address use of customer growth 10

factors to increase test year expenses. The Rate Case Plan does allow for the escalation 11

of expenses by customer growth factors in escalation years because, though it likely 12

overcompensates utilities for their costs, this methodology may offset other escalation 13

year simplifications that could undercompensate the utilities.2 14

This chapter contains analysis and recommendations only on the use of customer 15

growth factors to increase the test year expense forecasts. Cal Advocates’ primary 16

testimony and recommendations on O&M can be found in the Public Advocates Report 17

on District O&M Expenses. Cal Advocates’ primary testimony and recommendations on 18

A&G and labor can be found in the Public Advocates Report on District A&G Expenses, 19

District Payroll & New Employees, Conservation Expenses, and Special Request 4. 20

21

II. Summary of Recommendations 22

The Commission should reject GSWC’s O&M, A&G, and labor forecasts that 23

have been estimated using a customer growth factor. GSWC uses a “broad brush” in 24

applying customer growth factors to increase expenses that have tenuous, if any, 25

connection to customer growth and, if adopted, would likely overcompensate the utility 26

1 This report does not address supply expense forecasts, though such expenses are considered O&M expenses. Supply expenses, (e.g., purchased water, pump taxes, chemicals, etc.) are forecast using different methodologies than those used to forecast other O&M expenses and are addressed in the Public Advocates Office Report and Recommendations on Operations and Maintenance and Supply Expenses. 2 D.04-06-018, Interim Order Adopting Rate Case Plan, at p. 11.

2

for its costs. Removal of customer growth factors decreases test year labor and non-labor 1

expense budgets, company-wide, by an estimated $419,000. 2

3

III. Discussion 4

A. The Commission Should Reject GSWC’s Use of Customer Growth Factors 5 to Increase Test Year O&M and A&G Expense Forecasts as Adoption 6 Would Likely Overcompensate GSWC for Its Costs. 7

GSWC requests that the Commission adopt O&M and A&G test year expense 8

budgets for each of its ratemaking areas (“RMAs”), based on a five-year average of 9

historical recorded amounts, increased by an inflation factor, and further increased by a 10

customer growth factor specific to each RMA.3 GSWC’s requests also include 11

adjustments to specific accounts to incorporate additional expenses not captured by the 12

five-year historical average.4 As its only evidence supporting its use of customer growth 13

factors, GSWC states: 14

Operation and maintenance costs are related to both the size and the 15 demand put on the system. Customer growth increases both the size 16 of the system and the demand on the system resulting in increased 17 operation and maintenance expense.5 18 19

GSWC’s use of customer growth factors to increase test year expense forecasts 20

would likely overcompensate the utility for its costs if adopted. GSWC’s methodology 21

applies customer growth factors to all of its RMA O&M and A&G accounts, including 22

accounts with expenses that bear little direct relationship to customer growth or growth in 23

demand. For example, GSWC’s methodology applies a customer growth factor to its 24

Other Operation Expense accounts, which track costs ranging from management 25

consultant fees and public relations council fees to employee uniforms and footwear, 26

3 GSWC Prepared Testimony of Brad Powell (“Testimony of Brad Powell”) at p. 6. 4 See e.g., Testimony of Brad Powell at p. 10, detailing a specific request to increase test year budgets due to increased groundwater production at certain wells, necessitating increased frequency of media change outs for the granular activated carbon treatment facilities at those wells. 5 Testimony of Brad Powell at p. 6. See also p. 14, where GSWC repeats the same justification for A&G expenses: “Administrative and general costs are related to both the size and the demand put on the system. Customer growth increases both the size of the system and the demand on the system resulting in increased administrative and general expenses.”

3

from office space janitorial services to the electricity used to power GSWC buildings.6 1

GSWC’s testimony does not explain how a 1 percent increase in customers increases 2

GSWC’s uniform expenses by 1 percent. GSWC’s across-the-board application of a 3

customer growth factor belies this range of expense types and likely overstates actual cost 4

increases. 5

Further, while GSWC ties customer growth and demand together, even these 6

factors have not increased at a direct rate so that one measurement could be used as a 7

proxy for the other. For example, while GSWC’s customer count in Arden Cordova has 8

increased over time, its consumption has decreased, as shown in the chart below.7 9

GSWC’s testimony does not explain why a negative demand factor is not used to forecast 10

Arden Cordova’s expenses, in place of a positive customer growth factor, when it alleges 11

that increased demand increases expenses. 12

Table 1-1: Arden Cordova: Recorded Customers vs. Demand 13

14 GSWC may be able to make a showing that certain expenses do increase because 15

of and in some relation to customer growth and GSWC has the opportunity to make those 16

account- or item-specific adjustments in test year forecasts. As an analogous example, 17

6 Testimony of Brad Powell at pp. 6-7. 7 Data for 2011-2014 extracted from A.17-07-010, GSWC Response to Minimum Data Request Section A, Basic Information: Arden Cordova. Data for 2015-2019 extracted from A.20-07-012, GSWC Response to Minimum Data Request Section A, Basic Information: Arden Cordova.

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

15,600

15,800

16,000

16,200

16,400

16,600

16,800

17,000

17,200

2011 2012 2013 2014 2015 2016 2017 2018 2019

Dem

and

(CC

F)

Cus

tom

ers

Arden Cordova: Recorded Customers vs. Demand

Customers Demand

4

while GSWC does not apply customer growth factors to increase General Office 1

expenses across the board, GSWC increases specific expense accounts related to its 2

General Office postage, bill supplies, payment processing, and bad debt collection service 3

in direct proportion to the expected increase in bills it will send pursuant to Special 4

Request # 6, GSWC’s request to convert from bi-monthly to monthly billing.8 This 5

example indicates that GSWC can make specifically-justified adjustments to test year 6

expense accounts with supporting evidence when necessary. Thus, there is no reason to 7

apply GSWC’s “wide brush” to all district test year expense forecasts when customers 8

could ultimately end up paying for increases in expenses that GSWC is unlikely to incur. 9

The Commission has recognized these and similar concerns with the use of 10

customer growth factors to forecast expense budgets. In its 2004 Interim Rate Case Plan 11

Decision, the Commission replaced its “second test year, with its account-by-account 12

revenue requirement review, with an inflation-based escalation formula” in order to 13

streamline its review of general rate cases (GRCs).9 In discussing what factors should be 14

used to create budgets for escalation years, the Commission noted that while the causal 15

relationship between customer growth and expense increases is “almost certainly not 16

zero,” “utility work requirements and expenses do not necessarily increase in direct and 17

exact proportion to customer growth, and that productivity improvements should be able 18

to address many increases.”10 19

On balance, the Commission found the use of customer growth factors to forecast 20

escalation year expense budgets reasonable, because while this “will tend to 21

overcompensate the utility for increased costs,” overcompensation would offset other 22

escalation year simplifications “that may not fully encompass all possible future cost 23

increases.”11 Thus, while rougher estimating methodologies such as an across-the-board 24

8 See Attachment 1-2, GSWC Response to Public Advocates DR CR8-001, Q.4, Attachment: Bi-Monthly to Monthly Billing Costs Excel. 9 D.04-06-018, Interim Order Adopting Rate Case Plan, at p. 5. 10 D.04-06-018, Interim Order Adopting Rate Case Plan, at p. 11. 11 D.04-06-018, Interim Order Adopting Rate Case Plan, at p. 11. The Commission provided an example of an escalation year budget simplification that could undercompensate utilities - the rolling adoption of rates incorporating General Office allocations for multi-district utilities. As multi-district utilities now file rate

5

application of a customer growth factor could be appropriate in escalation year filings 1

when individual account requests are not considered and other simplifications may offset 2

this over-compensation, test year budgets should be forecast with account-by-account 3

specificity.12 The Commission should reject GSWC’s request to deviate from this 4

reasoning here, reducing test year non-labor O&M and A&G expense budgets by 5

approximately $262,000, companywide. 6

7

B. The Commission Should Reject GSWC’s Use of Customer Growth Factors 8 to Increase Test Year District Labor Expense Forecasts as GSWC’s 9 Methodology Would Likely Overcompensate GSWC for Its Costs 10

For similar reasons, the Commission should reject GSWC’s request to increase its 11

test year RMA labor budgets using customer growth factors. To calculate its test year 12

labor budget request, GSWC begins with its 2020 expense due to employee salaries,13 13

increased by an inflation factor, a 1% “merit adjustment,” and each RMA’s customer 14

growth factor.14 GSWC incorporates the salaries for new positions it requests into this 15

forecast as well. 16

GSWC’s use of customer growth factors to increase test year payroll budgets is 17

illogical and likely overcompensates the utility for its costs. In general, existing 18

employee salaries are not increased due to additions of customers. GSWC’s labor budget 19

request incorporates the salaries of six new employees, including an Operations Engineer, 20

whose new position is justified in part due to the size of the area to which the Operations 21

cases for all districts and the General Office simultaneously, utilities are no longer at risk of under-compensation in this area. 12 Subsequently, in Decision D.14-08-006, the Commission rejected San Jose Water Company’s test year 2013 expense budget requests that had been forecast using a customer growth factor. The Commission stated that “a plain reading of D.07-05-062 shows that the Commission did not apply customer growth to test year expenses but instead applied the customer growth to expenses in escalation years following the test year. Therefore, the Commission has eliminated customer growth as a factor in all test year expenses.” D.14-08-006, Resolving General Rate Case of San Jose Water Company, at p. 26. The Commission ultimately held that “[i]t is unreasonable to include customer growth escalation factors in test year expenses as test year expenses are escalated due to other factors.” D.14-08-006 at p. 120, Conclusion of Law #11. 13 This 2020 figure is comprised of the salaries of 2020 employees and the mid-range of salaries for vacant positions, allocated between expense and capitalized budgets, adjusted for vacant positions, and for stand-by, call-out, and overtime pay. For a more detailed explanation of this methodology, see GSWC Prepared Testimony of Nanci Tran at pp. 5-7. 14 GSWC Prepared Testimony of Nancy Tran at p. 7.

6

Engineer would be assigned as well as to the complexity of additional treatments systems 1

in that operating area.15 Because the need for new employees due to system size is 2

already incorporated in GSWC’s labor forecast, it is unclear exactly what cost increases 3

the customer growth factor represents. 4

In response to Cal Advocates’ request for more information, GSWC elaborated 5

that its use of customer growth factors to increase test year labor expenses is based on the 6

Commission’s logic and reasoning for allowing customer growth factors to increase 7

escalation year expense budgets.16 However, as noted above, the Commission reasoned 8

that while using a customer growth factor to increase expense budgets likely 9

overcompensates utilities for their costs, its use in escalation years was appropriate only 10

because it would offset other escalation year simplifications that could undercompensate 11

utilities for their costs. Because GSWC here uses customer growth factors to increase 12

test year budget requests, rather than escalation year requests, the Commission’s logic 13

and reasoning do not support GSWC’s request. 14

The use of customer growth factors to increase test year labor budgets likely 15

overcompensates GSWC for its costs. GSWC should not be authorized to increase its 16

test year labor budget request by such factors, particularly when it can make specific test 17

year budget requests for new employees based on customer growth, if necessary. This 18

recommendation would reduce test year labor budgets by approximately $157,000, 19

companywide. 20

21

IV. Conclusion 22

The Commission should reject GSWC’s use of customer growth factors to 23

increase test year O&M, A&G, and labor expense budget forecasts. GSWC’s 24

methodology, if adopted, would likely overcompensate GSWC for its costs. The use of 25

15 GSWC Prepared Testimony of Denise Kruger at p. 9. GSWC’s labor forecast incorporates further specifically justified adjustments to payroll, including elimination of positions due to productivity improvements in customer service. GSWC Prepared Testimony of Denise Kruger at p. 5. 16 Attachment 1-3, GSWC Response to Public Advocates DR SLM-005, Q.2.

7

customer growth factors is inappropriate for test year forecasts when specific account 1

adjustments can be made and supported by evidence. 2

8

CHAPTER 2: LOW INCOME ASSISTANCE PROGRAM 1 2

I. Introduction 3

This chapter presents Cal Advocates’ analysis and recommendations regarding 4

GSWC’s low income customer assistance program, referred to as California Alternative 5

Rates for Water (“CARW”). GSWC does not request any changes to its CARW 6

program, which provides eligible customers a credit of about 20 percent of the average 7

CARW customer bill in each RMA. Cal Advocates does not oppose GSWC’s request to 8

continue its existing CARW program unchanged; however, adopted credits should 9

correct for a mistake made in GSWC’s workpapers regarding the calculation of proposed 10

CARW credits and surcharges. 11

12 Table 2-1: Comparison of GSWC and Cal Advocates’ Proposed Credits and 13 Surcharges: 14

RMA GSWC Proposed CARW Credit17

Cal Advocates Proposed

CARW Credit

GSWC Proposed CARW

Surcharge (per ccf,

unless “flat”)

Cal Advocates’ Proposed CARW

Surcharge (per ccf, unless “flat”)

Arden Cordova $7.00 $7.00 $0.116 $0.116 Arden Cordova

(flat rate) $19.00 $19.00 $1.593 $1.593

Bay Point $18.00 $18.00 $0.116 $0.116 Clearlake $32.00 $32.00 $0.116 $0.116 Los Osos $30.00 ($25.00*) $30.00 ($25.00*) $0.116 $0.116

Santa Maria $11.00 ($12.00*) $11.00 ($12.00*) $0.116 $0.116 Simi Valley $12.00 $12.00 $0.116 $0.116

Region 2 $17.00 $14.00 $0.207 $0.170 Region 3 $13.00 $13.00 $0.082 $0.082

15

16

17 See GSWC RO Model Workpaper W_Reports_All, tab: CARW for GSWC’s proposed credits and surcharges. Credits marked with an asterisk should be used for Los Osos and Santa Maria if the Commission adopts GSWC Special Request 13 to consolidate those RMAs. GSWC also proposed that non-profit group living facilities, agricultural employee housing facilities, and migrant farmworker housing centers will receive a flat monthly credit of $28.26. Cal Advocates does not oppose this request.

9

II. Discussion 1

Cal Advocates does not oppose GSWC’s request to continue its CARW 2

program. There are two open rulemakings at the CPUC addressing affordability 3

and low income customer credits.18 The State Water Resources Control Board 4

(“SWRCB”) is also exploring affordability and low income assistance for water 5

programs at the State level (related to Assembly Bill 401). Therefore, it is prudent 6

for the Commission to await the outcome of these open CPUC rulemakings and 7

the SWRCB state-wide water CARW activity before making changes to GSWC’s 8

CARW program. However, as described below, the final adopted credits should 9

correct for an error in GSWC’s workpapers. 10

GSWC designs its CARW credits to equal 20 percent of an average CARW 11

customer bill. GSWC develops the average CARW customer bill by finding the average 12

monthly usage for CARW customers in each region, here determined to be 10 hundred 13

cubic feet (or “centum” cubic feet, “ccf”) in each of the three regions.19 While the 14

average usage is based on Region-wide totals, because each RMA has a different revenue 15

requirement and rate design, the CARW discount is calculated separately for each RMA. 16

GSWC calculates what a customer’s bill would be in each RMA, assuming 10 ccf of 17

consumption with a 5/8” by 3/4” meter. GSWC then uses these average bill estimates as 18

the basis for the fixed bill credits, with 20 percent of the bill developed for each RMA set 19

as that RMA’s credit amount, rounded to the nearest whole dollar. This fixed credit is 20

applied to CARW customer bills regardless of actual usage.20 21

18 R.17-06-024 (“OIR Evaluating the Commission’s 2010 Water Action Plan Objective of Achieving Consistency between Class A Water Utilities’ Low-Income Rate Assistance Programs, Providing Rate Assistance to All Low-Income Customers of Investor-Owned Water Utilities, and Affordability”) and R.18-07-006 (“OIR to Establish a Framework and Processes for Assessing the Affordability of Utility Service”). 19 GSWC used 2019 data to estimate the average monthly CARW usage, totaling the total CARW customer usage from 2019 and dividing by the total usage by the total number of monthly CARW bills. Attachment 2-1, GSWC Response to Public Advocates DR EO2-003, Q.2. 20 An additional amount hovering around 10 cents is added to the CARW credit to offset the cost of GSWC’s Credit Card Payment Pilot Program, which is intended in part to determine whether a credit card payment option benefits low income ratepayers by helping to prevent service disconnections, though this amount is not included in the credits or surcharges discussed in this report. See A.20-07-012 at p. 25; see also Public Advocates Office Report on District A&G Expenses, District Labor Expenses, Conservation

10

A. Correcting an Error in CARW Credit Calculation 1 GSWC’s workpapers21 contain a mistake when calculating the CARW credit for 2

Region 2, in which the “average bill” basis is calculated using 12 ccf, rather than the 3

average 10 ccf.22 This leads to a proposed discount for Region 2 representing 23.6 4

percent of the average CARW customer bill, rather than 20 percent. 5

Table 2-3: Effects of Use of 12 ccf Rather than 10 ccf Consumption on Region 6 2 CARW Credit 7

GSWC Estimated 2022 Bill23

20% Credit

Region 2, 12 ccf $84.05 $17.00 Region 2, 10 ccf $72.17 $14.00 8

The Commission’s final adopted CARW credits should correct this mistake so that 9

CARW credits across GSWC’s service territory all represent a 20 percent credit to a bill 10

for 10 ccf of consumption. 11

12

III. Conclusion 13

The Commission should allow GSWC to continue its CARW program. The final 14

adopted surcharges and credits for the CARW program should reflect the noted 15

correction to GSWC’s workpapers and should incorporate the final adopted rates in this 16

proceeding. 17

18

19

20

21

22

Expenses and Special Request 4 for Cal Advocates’ recommendation regarding the Credit Card Payment Pilot Program. 21 GSWC Workpaper W_Report_All.xlsx, tab: CARW Consolidated, cell: L52. 22 Attachment 2-1, GSWC Response to Public Advocate DR EO2-003 CARW, Q.2. 23 Each average bill is calculated assuming a 5/8” x 3/4” meter, consistent with GSWC’s current methodology, and GSWC’s proposed rates and rate design.

11

ATTACHMENT 1-1: STATEMENT OF QUALIFICATIONS

12

Witness Statement of Qualifications: 1

Q1. Please state your name, business address, and position with the CPUC: 2

A1. My name is Eileen Odell and my business address is 505 Van Ness, San Francisco 3

CA, 94102. I am a Public Utilities Regulatory Analyst V in the Communications 4

and Water Policy Branch of the Public Advocates Office. 5

Q2. Please summarize your education background and professional experience. 6

A2. I received a Bachelors’ Degree in Political Science from the University of 7

California, San Diego in 2007. I earned a Juris Doctor degree from the University 8

of California, Hastings College of the Law in 2011. I am admitted to the 9

California State Bar. 10

I have been with the Public Advocates Office – Communications and Water Policy 11

Branch since June 2014. Prior to joining the Public Advocates Office, I held a 12

legal fellowship with the Office of Sonoma County Counsel, where I assisted in 13

representing county agencies including the Sonoma County Water Agency. 14

Q3. What is your responsibility in this proceeding, GSWC Test Year 2022 General 15

Rate Case, A.20-07-012? 16

A3. In addition to serving as Project Lead, I am responsible for the preparation of the 17

Executive Summary and I jointly sponsor the Results of Operations (“RO”) tables 18

with our RO witness, Chris Ronco. Finally, I am the author of Cal Advocates’ 19

recommendations regarding GSWC’s use of customer growth factors to forecast 20

test year expense and labor budgets, and for Cal Advocates’ recommendations 21

concerning GSWC’s low income program, California Alternative Rates for Water. 22

Q4. Does this conclude your prepared direct testimony? 23

A4. Yes, it does. 24

13

ATTACHMENT 1-2: GSWC RESPONSE TO PUBLIC ADVOCATES DATA

REQUEST CR8-001, Q.4

14

Conversion from Bi-Monthly to Monthly Billing - Remaining AccountsCost Estimations for 2022 to 20242020 General Rate Case

Total Estimated Annual Cost to Move Remaining Bi-Monthly Accounts to Monthly Billing Cycle: $799,225

Postage - General Office (9012), WUDF 773.25

RMA/CSA REMAINING BI-MONTHLY ACCOUNTS

ADDITIONAL MONTHLY BILLS

PER YEAR

PAPER BILLS e-BILLS REMINDER NOTICES

SHUT OFF NOTICES

Total

73.69% 26.31% 21.74% 6.73%$0.49 $0.00 $0.49 $0.49

ARDEN CORDOVA 16,231 97,386 $35,165 $0 $10,375 $3,211 $48,751LOS OSOS 3,287 19,722 $7,121 $0 $2,101 $650 $9,873SIMI VALLEY 12,866 77,196 $27,874 $0 $8,224 $2,546 $38,644PLACENTIA 15,426 92,556 $33,421 $0 $9,860 $3,052 $46,333LOS ALAMITOS 27,848 167,088 $60,333 $0 $17,800 $5,510 $83,643BARSTOW 8,987 53,922 $19,470 $0 $5,744 $1,778 $26,993SAN GABRIEL 12,470 74,820 $27,016 $0 $7,971 $2,467 $37,454

97,115 582,690 $210,401 $0 $62,074 $19,215 $291,691

Percent of Additional BillsCost per Transaction

15

Bill Supplies - General Office (9012), WUDF 773



PER YEAR

PAPER BILLS e-BILLS REMINDER NOTICES

SHUT OFF NOTICES

Total

73.69% 26.31% 21.74% 6.73%$0.08 $0.00 $0.08 $0.08

ARDEN CORDOVA 16,231 97,386 $5,741 $0 $1,694 $524 $7,959LOS OSOS 3,287 19,722 $1,163 $0 $343 $106 $1,612SIMI VALLEY 12,866 77,196 $4,551 $0 $1,343 $416 $6,309PLACENTIA 15,426 92,556 $5,456 $0 $1,610 $498 $7,565LOS ALAMITOS 27,848 167,088 $9,850 $0 $2,906 $900 $13,656BARSTOW 8,987 53,922 $3,179 $0 $938 $290 $4,407SAN GABRIEL 12,470 74,820 $4,411 $0 $1,301 $403 $6,115

97,115 582,690 $34,351 $0 $10,135 $3,137 $47,623


Payment Processing - General Office (9012), WUDF 773



PER YEAR

MAILED CHECKS

ONLINE BANK OR

RECURRING

WALK-IN PAYMENTS

ONE-TIME EZ-PAY

Total

31.91% 46.82% 11.59% 9.62%$0.00 $0.07 $0.00 $1.45

ARDEN CORDOVA 16,231 97,386 $0 $3,192 $0 $13,584 $16,776LOS OSOS 3,287 19,722 $0 $646 $0 $2,751 $3,397SIMI VALLEY 12,866 77,196 $0 $2,530 $0 $10,768 $13,298PLACENTIA 15,426 92,556 $0 $3,033 $0 $12,911 $15,944LOS ALAMITOS 27,848 167,088 $0 $5,476 $0 $23,307 $28,783BARSTOW 8,987 53,922 $0 $1,767 $0 $7,522 $9,289SAN GABRIEL 12,470 74,820 $0 $2,452 $0 $10,437 $12,889

97,115 582,690 $0 $19,097 $0 $81,279 $100,377


Bad Debt Collection Service - General Office (9012), WUDF 781



PER YEAR

BAD DEBT COLLECTION

SERVICE0.06%$44.20

ARDEN CORDOVA 16,231 97,386 $2,583LOS OSOS 3,287 19,722 $523SIMI VALLEY 12,866 77,196 $2,047PLACENTIA 15,426 92,556 $2,455LOS ALAMITOS 27,848 167,088 $4,431BARSTOW 8,987 53,922 $1,430SAN GABRIEL 12,470 74,820 $1,984

97,115 582,690 $15,453


16

Additional Temporary Customer Service Representatives (CSRs) - General Office (9012), WUDF 781

Approximately 6.5 Temporary CSRs at $52,000/year $336,018Additional Phone Service Fees $8,064

Total $344,082 1

1 These costs are temporary and not anticipated to be necessary after 2024 as customers fully adjust to monthly bills.

17


REQUEST SLM-005, Q.2

19


REQUEST EO2-003, Q.2

report and recommendations on customer growth …

Documents