Shuman,McCuskey&’Slicerpuc Attorneys at Law
1411 Virginia Street, East www.shurnanlaw.com 1445 Stewartstown Road, Suite 200 Suite 200 Morgantown, West Virginia 26505 EO. Box 3953 Telephone 304.291.2702 Charleston, West Virginia 25339 Christopher D. Negley, Esq. Facsimile 304.291.2840 Telephone 304.345.1400 Facsimile 304.343.1826 [email protected]
August 24,20 17
Ingrid Ferrell Executive Secretary Legal Division Public Service Commission of West Virginia 201 Brooks Street Charleston, West Virginia 25301
,? ,* Re: Case No. 17- 1.21,$?- p1VP - ik- t c/L: Public Service Commission of West Virginia Application for a Certificate of Convenience and for the construction, operation and maintenance o system improvements and charges, and for approval of financing related thereto
Dear Ms. Ferrell:
Enclosed herein please find an original and twelve copies of a Joint Petition filed by the Pocahontas County Public Service District (“District”) and Cheat Mountain Water Company, Inc. (“CMW’), whereby the District proposes to purchase the assets of CMW and thereafter provide water services to the approximately 606 former customers of CMW as provided in an Asset Purchase Agreement dated May 25, 2017, and executed among CMW, Snowshoe Mountain, Inc. (“SMI”) and the District (“APA). Further, and pursuant to the APA, the District will acquire from CMW and operate all of CMW’s public utility assets (“CMW Assets”), and also will acquire from SMI certain additional assets owned by SMI that will facilitate District’s operation of the System (“SMI Assets”).
The proposed project will take place in the Snowshoe and Silver Creek Resort areas of Pocahontas County. In addition to purchasing the assets of CMW the District proposes to make renovations and improvements to the existing water production, water treatment and water production facilities. These improvements include: electrical service upgrade and miscellaneous repairs at the raw water pump station; providing a spare Raw Water Pump; installing a backup generator at the raw water pimp station; installing fencing at the raw water pump station; installing fencing at WTP, fencing of the backwash basin; fencing at various water supply wells; filter painting and media replacement; connection of emergency generator to WTP; miscellaneous WTP building repairs; replacing valves at WTP; emergency generator for one booster pump station; installing leak detection meters and installing various isolation valves. In
1 the Joint Petition, the District seeks a certificate of public convenience and necessity for these renovations and improvements.
The total estimated cost of the project (both acquisition and improvements) is $2,365,700. The approved financing package involves a West Virginia Infrastructure & Jobs Development Council loan in the amount of $$2,109,700 (3% for 20 years) and a commercial loan in the amount of $256,000 (3.95% for five years).
The District submits the following documents as required by Rule 26 of the Commission’s Rules ofpractice and Procedure.
26.1 and 26.2. Attached hereto as Checklist Items Nos. 26.1 and 26.2 is the Form #4 Application, signed and notarized by Mark Smith, Chairman, Pocahontas County Public Service District.
26.3 (a) through (g). Attached hereto as Checklist Item 26.3 (a) through (8) is the Pocahontas County Public Service District - Water Department’s Rule 42 Exhibit as of June 30, 2017 including proposed rate structure and existing rate structure. The proposed tariff is based on the CPA’s projections as contained in the Rule 42 Exhibit.
26.4. Not applicable to this filing.
26.5. Attached as Checklist Item 26.5 is a Joint Petition submitted by the District and CMW along with several incorporated documents including an Asset Purchase Agreement which includes Exhibits A (denoting CMW assets) and B (denoting SMI assets) and incorporates three ancillary agreements: Exhibit C (Joint Use Agreement), Exhibit D (Property Exchange and Disposition Agreement) and Exhibit E (Access Agreement.)
26.6. Checklist item 26.6 is contained within the Preliminary Engineering Report (See Checklist Item 26.121.
26.7. Attached as Checklist Item 26.7 is a draft bond resolution
26.8(a) and (b). Attached hereto as Checklist Item 26.8 is email correspondence from Eric Coberly, P.E., the project engineering manager, confirming that no permits will be needed for the acquisition.
26.9.b. Funding Sources. The project calls for both public and private financing. Regarding public financing the full WVIJDC council has approved the project on the terms outlined above. The District will supplement this filing when the binding commitment letter is received. Regarding private financing, the District attaches a Term Loan sheet from Citizen’s Bank of West Virginia for the loan.
26.10. Not applicable to this application,
2 26.11. Attached hereto as Checklist Item 26.11 is the name, classification and operator license number for the plant operators.
26.12 (a) through (1). Attached as Checklist Items 26.12(a) through (1) are two identical CD’s containing the Preliminary Engineering Report completed by E. L. Robinson Engineering Company dated April 2017.
The PER addresses these areas:
Current Situation Water Treatment and Distribution Future Situation Alternatives Operation & Maintenance Costs and Present Worth Analysis Plan Selection and Public Participation Environmental Information (including) Project Summary Conclusions and Recommendations
26.13(a) through (h). Please see the Preliminary Engineering Report.
26.14(a) through (b). Please see the Preliminary Engineering Report
26.15. Please see the Preliminary Engineering Report.
26.16. Attached as Checklist Item 26.16 is a proposed Form No. 4. Following acceptance by the Commission the District will provide a Word copy of Form No. 4 via email.
26.17. Not applicable to this application as the project has been approved by the West Virginia Infrastructure & Jobs Development Council.
26.18. Not applicable to this application.
26.19. Not applicable to this application.
26.20 See Preliminary Engineering Report.
26.21, See Preliminary Engineering Report
26.22 Not applicable to this application.
26.23 Not applicable to this application.
26.24. Attached is the review for WVIJDC application #2016W-1697 and approved by the full council on June 7, 2017. The District will supplement this application when the binding commitment letter is received.
3 Please include Christopher L. Callas and Nicklaus A. Presley of Jackson Kelly PLLC on the Commission’s service list as counsel for CMW.
Thank you for your attention to this matter. Should you have any questions, please do not hesitate to contact me.
Yours sincerely, (’ ’1
, CGstopher D. Negley
Enclosures cc: Christopher Callas, Esq., Counsel for co-petitioner CMW PSD Board Lloyd Coleman, General Manager John TuggleiLeslie Taylor, Region 4 Tina J. Hall, WVDEP State Revolving FundiManagement Section
4 Form No. 4
APPLICATION FOR A CERTIFICATE OF CONVENIENCE AND NECESSITY
State of West Virginia Public Service Commission Charleston
CaseNo. 17-
Application of the Pocahontas County Public Service District for a certificate of convenience and necessity to purchase the assets of Cheat Mountain Water, Inc., and operate a water utility in the Snowshoe and Silver Creek Areas in the County of Pocahontas.
Pocahontas County Public Service District, the applicant herein, respectfully states:
1. The name and address of the applicant are: Pocahontas County Public Service District 14066 Bank Mountain Road Bartow, West Virginia 24920.
2. The applicant proposes to purchase the assets of Cheat Mountain Water, Inc., and thereafter provide water services to the approximately 606 former customers of Cheat Mountain Water, Inc., as provided in an Asset Purchase Agreement dated May 25, 2017, and executed among Cheat Mountain Water, Inc., Snowshoe Mountain, Inc. (“SMI”) and the applicant (“MA”).Further, and pursuant to the APA, the District will acquire from CMW and operate all of CMWs public utility assets (“CMW Assets”), and also will acquire from SMI certain additional assets owned by SMI that will facilitate District’s operation of the System (“SMI Assets”). The service area for the new District’s water service will be the Snowshoe and Silver Creek areas of Pocahontas County, West Virginia.
3. Service is now rendered by an existing utility known as Cheat Mountain Water, Inc., All of its operations are proposed to be sold to the District as a part of the APA.
4. The Public Service Commission, by Recommended Decision dated November 19, 1997 and by Final Order dated December 9, 19997, in Case No. 96-1252-PSWD-PC, recognized, inter alia, the name change of the Upper Greenbrier Public Service District to the Pocahontas County Public Service District.
5. If applicable, the West Virginia Infrastructure and Jobs Development Council Project Number and date of Infrastructure approval: The WVIDJC project number is 2016W- 1697. The proposed project was approved by the WVIJDC N1 council on June 7, 2017.
6. A certificate should be issued for the following reasons: The purchase of these assets by E
the PSD combined with its proven ability to provide potable drinking water is the most cost-effective and environmentally sound to address drinking water needs in this area.
NOTE: This application must be accompanied by information required by Tariff Rule 42. Water and Sewer utilities must include infomation required by the Checklist set forth in Rule 26 of the Commission's Rules of Practice and Procedure.
Mark Smith, Chairman, Pocahontas County Public Service District
Respectfully submitted
Pocahontas County Public Service District BY Counsel
SHUMAN, MCCUSKEY & SLICER, PLLC Street: 141 1 Virginia Street, East, Suite 200 (25301) Post Office Box 3953 Charleston, West Virginia 25339-3953 (304) 345-1400
Given under my hand and seal this 12" day of July, 201 7.
My Commission Expires: c Q I , 7Diq
December 01. 2019 Rule 42 Exhibit POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT - WATER DEPARTMENT
~.- ‘i_ ,>E
June 30,2016 Phone 304.263.0891 Toll Free 877 242.7278 Fax 304.263.0997 ida
cr INDEPENDENT ACCOUNTANTS' COMPILATION REPORT
To the Board of Directors Pocahontas County Public Service District Pocahontas County, West Virginia
We have compiled the accompanying pro forma schedules of the Pocahontas County Public Service District - Water Department, "Water Department" as of June 30, 2016 and for the year then ended, and the accompanying supplementary information which is presented only for supplementary analysis purposes included in the accompanying prescribed form. The historical financial statements of the Water Department were compiled by us. We have not audited or reviewed the accompanying Rule 42 Exhibit pro forma financial information and, accordingly, do not express an opinion or provide any assurance about whether the pro forma information is in accordance with requirements of the Public Service Commission of West Virginia.
Management is responsible for the preparation and fair presentation of the pro forma financial information in accordance with the requirements of the Public Service Commission of West Virginia and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the pro forma financial information.
Our responsibility is to conduct the compilation in accordance with the Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The Objective of the compilation is to assist management in presenting financial information in the form of pro forma financial information without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the pro forma financial information.
The objective of this pro forma financial information is to show what the significant effects on the historical information might have been had the construction and acquisition of certain public water facilities and related proposed water rates and charges occurred at an earlier date. However, the pro forma financial statements are not necessarily indicative of the results of operations or related effects on financial position that would have been attained had the above-mentioned events actually occurred earlier.
These pro forma schedules and supplementary information are presented in accordance with the requirements of the Public Service Commission of West Virginia, and are not intended to be a presentation in accordance with accounting principles generally accepted in the United States of America.
This report is intended solely for the information and use of the District's Water Department, West Virginia Infrastructure and Job Development Council, West Virginia Water Development Authority, and the Public Service Commission of West Virginia and is not intended to be and should not be used by anyone other than these specified parties.
c3 Pw&Mhah Pa8 Martinsburg, West Virginia
April 10, 2017 CONTENTS
Independent Accountants' Report on Rule 42 Exhibit 4
Statement of net income (Statement A) 5
Detail of operating revenues (Statement A-I) 6
Detail of operation and maintenance expenses (Statement A-2) 7
Detail of depreciation and amortization expense (Statement A-3) a
Detail of taxes other than federal income taxes (Statement A-4) 9
Detail of other income (Statement A-6) 10
Detail of other income deductions (Statement A-7) 11
Average rate base (Statement 6) 12
Detail of utility plant in service (Statement 6-1) 13-14
Detail of plant held for future use (Statement 6-2) 15
Detail of unclassified plant in service (Statement 8-3) 16
Detail of construction work in progress (Statement 6-4) 17
Detail of materials and supplies (Statement 6-5) la
Detail of prepayments (Statement E-6) 19
Detail of working cash allowance (Statement 6-7) 20
Detail of accumulated depreciation and amortization (Statement 6-8) 21
Detail of retirement work in progress (Statement 6-9) 22
Detail of contributions in aid of construction (Statement 6-10) 23
Detail of customers' advances for construction (Statement 6-1 1) 24
Detail of customers' deposits (Statement 6-12) 25
Accumulated deferred income taxes (Statement 6-1 3) 26
Deferred investment tax credits (Statement 6-14) 27
Other deferred debits (Statement 6-15) 2a
Other deferred credits (Statement 6-16) 29 CONTENTS
Rule 42 Exhibit (Continued)
Detail of debt capital per books (Statement C-I) 30
Detail of debt capital pro forma (Statement C-2) 31
Detail of debt capital - amortization schedules going level (Statement C3) 32-35
Detail of debt capital- amortization schedules pro forma (Statement C4) 36-37
Bill analysis per books (Statement D sheets 1 through 6) 38-43
Bill analysis per going level (Statement D sheets 7 through 8) 44-45
Bill analysis per pro forma (Statement D sheets 9 through IO) 46-47
Comparison of per books, going level and pro forma tariffs (Statement D-I) 48
Approved "going level" tariff (Statement D-2 sheet 1) 49
Proposed "pro forma" tariff (Statement D-3 sheet 2) 50
Allocation of cost of service (Statement E) 51
Balance sheets at June 30,2016 and 2015 (Statement F) 52-53
Comparative statements of earned surplus (Statement F-I) 54
Cash flow analysis (Statement F-2) 55
Detail of adjustments going level (Statement G-I) 56-60
Detail of adjustments pro forma (Statement G-I) 61-65
Summary of significant assumptions 66-67 t9 t9
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3F 3F 7 7 & & -!& -!& m m 0 0 .-u) ._ln U U Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30,2016 Statement C Schedule 3 Sheet 1 of 4
1997 USDA Water Revenue Bond Series A
PrinciDal Interest TOTAL 2017 $ 6,988 8 10,424 $ 17,412 2018 7,306 10,106 17,412 2019 7,638 9,774 17,412 2020 7,986 9,426 17,412 2021 8,349 9,063 17,412 2022 8,729 8,683 17,412 2023 9,126 8,286 17,412 2024 9,541 7,871 17,412 2025 9,976 7,436 17,412 2026 10,430 6,982 17,412 2027 10,904 6,508 17,412 2028 11,400 6,012 17,412 2029 11,919 5,493 17,412 2030 12,462 4,950 17,412 2031 13,029 4,383 17,412 2032 13,622 3,790 17,412 2033 14,241 3,171 17,412 2034 14,890 2,522 17,412 2035 15,567 1,845 17,412 2036 16,275 1,137 17,412 2037 13,003 293 13,296 2038 - 2039 - 2040 - 2041 - 2042 2043 2044 - 2045 - 2046 - 2047 - 2048 2049 - 2050 - - 2051 - - Total payments $ 233,381 $ 128,155 $ 361,536
See independent accountants' report and summary of significant assumptions 32 Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30,2016 Statement C Schedule 3 Sheet 2 of 4
1997 USDA Water Revenue Bond Series B
PrinciDal Interest TOTAL 2016 $ 3,322 $ 4,946 $ 8,268 2017 3,473 4,795 8,268 2018 3,631 4,637 8,268 2019 3,796 4,472 8,268 2020 3,969 4,299 8,268 2021 4,149 4,119 8,268 2022 4,338 3,930 8,268 2023 4,536 3,732 8,268 2024 4,742 3,526 8,268 2025 4,958 3,310 8,268 2026 5,183 3,085 8,268 2027 5,420 2,848 8,268 2028 5,666 2,602 8,268
2029 5,924 2 ~ 344 8,268 2030 6,193 2,075 8,268 2031 6,475 1,793 8,268 2032 6,770 1,498 8,268 2033 7,078 1,190 8,268 2034 7,400 868 8,268 2035 7,737 531 8,268 2036 5,980 134 6,114 2037 - - 2038 - - - 2039 - - - 2040 - - - 2041 - - 2042 - 2043 - 2044 - 2045 2046 - - 2047 - - - 2048 - - - 2049 - - - 2050 - - Total payments $ 110,740 $ 60,734 $ 171,474
See independent accountants' report and summary of significant assumptions. 33 Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30,2016 Statement C Schedule 3 Sheet 3 of 4
2011 Water Revenue Bond Series A
-Year PrinciDal Interest TOTAL 2016 $ 7,648 $ - $ 7,648 2017 7,648 - 7,648 2018 7,648 - 7,648 2019 7,648 7,648 2020 7,648 7,648 202 1 7,648 7,648 2022 7,648 7,648 2023 7,648 7,648 2024 7,648 7,648 2025 7,648 7,648 2026 7,648 7,648 2027 7,648 7,648 2028 7,648 7,648 2029 7,648 7,648 2030 7,648 7,648 2031 7,648 7,648 2032 7,648 7,648 2033 7,648 7,648 2034 7,648 7,648 2035 7,648 7,648 2036 7,648 7,648 2037 7,648 7,648 2038 7,648 7,648 2039 7,648 7,648 2040 7,648 7,648 2041 7,648 7,648 2042 7,648 7,648 2043 7,648 7,648 2044 7,648 7,648 2045 7,648 7,648 2046 7,648 7,648 2047 7,648 7,648 2048 7,648 7,648 2049 7,648 7,648 2050 2,912 - Total payments $ 262,944 $ 260,032
See independent accountants' report and summary of significant assumptions. 34 Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30,2016 Statement C Schedule 3 Sheet 4 of 4
Long-Term Debt - Per Books
-Year Principal Interest -Total 201 7 $ 17,958 $ 15,370 $ 33,328 2018 18,427 14,901 33,328 2019 18,917 14,411 33,328 2020 19,430 13,898 33,328 2021 19,966 13,362 33,328 2022 20,526 12,802 33,328 2023 21,112 12,216 33,328 2024 21,725 11,603 33,328 2025 22,366 10,962 33,328 2026 23,036 10,292 33,328 2027 23,735 9,593 33,328 2028 24,468 8,860 33,328 2029 25,233 8,095 33,328 2030 26,034 7,294 33,328 2031 26,870 6,458 33,328 2032 27,745 5,583 33,328 2033 28,659 4,669 33,328 2034 29,616 3,712 33,328 2035 30,615 2,713 33,328 2036 31,660 1,668 33,328 2037 26,631 427 27,058 2038 7,648 - 7,648 2039 7,648 - 7,648 2040 7,648 - 7,648 2041 7,648 - 7,648 2042 7,648 - 7,648 2043 7,648 - 7,648 2044 7,648 7,648 2045 7,648 7,648 2046 7,648 7,648 2047 7,648 - 7,648 2048 7,648 - 7,648 2049 7,648 - 7,648 2050 7,648 - 7,648 2051 2,912 - 2,912
Totals $ 607,065 $ 188,889 $ 795,954
See independent accountants' report and summary of significant assumptions. 35 Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30,2016 Statement C Schedule 4 Sheet 1 of 2
2017 A Bond Series
-Year Princiaal Interest -Total 201 7 $ - $ $ - 2018 78,514 63,291 141,805 2019 80,869 60,936 141,805 2020 83,295 58,510 141,805 2021 85,794 56,011 141,805 2022 88,368 53,437 141,805 2023 91,019 50,786 141,805 2024 93,750 48,055 141,805 2025 96,562 45,243 141,805 2026 99,459 42,346 141,805 2027 102,443 39,362 141,805 2028 105,516 36,289 141,805 2029 108,682 33,123 141,805 2030 11 1,942 29,863 141,805 2031 115,300 26,505 141,805 2032 118,759 23,046 141,805 2033 122,322 19,483 141,805 2034 125,992 15,813 141,805 2035 129,772 12,033 141,805 2036 133,665 8,140 141,805 2037 137,677 4,128 141,805 2038 - 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051
Totals $ 2,109,700 $ 726,400 $ 2,836,100
See independent accountants’ report and summary of significant assumptions 36 Pocahontas County Public Service District DETAIL OF DEBT CAPITAL For the years ending after June 30, 2016 Statement C Schedule 4 Sheet 2 of 2
Long-Term Debt -Year Principal interest 2017 $ 17,958 $ 15,370 $ 33,328 2018 96,941 78,192 175,133 2019 99,786 75,347 175,133 2020 102,725 72,408 175133 202 1 105,760 69,373 175133 2022 108,894 66,239 175,133 2023 112,131 63,002 175,133 2024 115,475 59,658 175,133 2025 118,928 56,205 175,133 2026 122,495 52,638 175,133 2027 126,178 48,955 175,133 2028 129,984 45,149 175,133 2029 133,915 41,218 175,133 2030 137,976 37,157 1 75,133 2031 142,170 32,963 175,133 2032 146,504 28,629 175,133 2033 150,981 24,152 175133 2034 155,608 19,525 175133 2035 160,387 14,746 175,133 2036 165,325 9,808 175,133 2037 164,308 4,555 168,863 2038 7,648 7,648 2039 7,648 7,648 2040 7,648 7,648 2041 7,648 7,648 2042 7,648 7,648 2043 7,648 7,648 2044 7.648 7,648 2045 7,648 7,648 2046 7,648 7,648 2047 7,648 7,648 2048 7,648 7,648 2049 7,648 7,648 2050 7,648 7,648 2051 2,912 2,912
Totals $ 2,716,765 $ 915,289 $ 3,632,054
See independent accountants' report and summary of significant assumptions. 37 N ".(D mlc
0 .- 0 m 0. 0. m (D m0 i m"
Pocahontas County Public Service District BILL ANALYSIS - GOING LEVEL - WATER For the year ended June 30,2016 Statement D Customer Bill Analysis - Cheat Mountain Water Sheet 7 of 10
Total Number of PER BOOKS Gallons Rate Bills Revenue Efficiency wlo kitchen 11.22 Efficiency 12.82 204 7,845.84 1 Bedroom 19.24 289 16,681.08 2 Bedroom 20.44 512 31,395.84 3 Bedroom 22.04 266 17,587.92 4 Bedroom 23.25 128 8,928.00 5 Bedroom 24.44 180 13,19760 6 Bedroom 26.04 28 2,187.36 1 Bedroom + 3 Bedroom 41.28 24 2,972.16 1 Bedroom + 4 Bedroom 42.49 4 509.88 1 Bedroom + 4 Bedroom + Hot Tub 44.89 4 538.68 2 Bedroom + 3 Bedroom 42.48 4 509.76 2 Bedroom + Hot Tub 22.84 28 1,918.56 4 Bedroom + Hot Tub 25.65 156 12,004.20 5 Bedroom + Hot Tub 26.84 135 10,870.20 6 Bedroom + Hot Tub 28.44 80 6,825.60 Unit owner associations 466.74 264 369,658.08 2,306 503,630.76
Commercial 12,883,406 $ 7.27 31 1 93,662.36 Restaurant 370,400 $ 125.00 20 46,300.00 Compressor 68,630 $ 425.00 8 29,167.75
Revenue per analysis - $ 2,645 $ 672,760.87
Correction factor 0.999930
Residential revenue $ 672.714
See independent accountants' report and summary of significant assumptions.
44
Pocahontas County Public Service District BILL ANALYSIS - PRO FORMA For the year ended June 30,2016 Statement D Sheet 9 of 10 Customer Bill Analysis - Cheat Mountain Water
Total # of
PER BOOKS Gallons Rate Bills Revenue Efficiency wlo kitchen - 14.59 - - Efficiency - 16.67 204 10,202.04 1 Bedroom - 25.01 289 21,683.67 2 Bedroom 26.57 512 40,811.52 3 Bedroom - 28.65 266 22,862.70 4 Bedroom 30.23 128 11,608.32 5 Bedroom 31.77 180 17,155.80 6 Bedroom 33.85 28 2,843.40 I Bedroom + 3 Bedroom 53.66 24 3,863.52 1 Bedroom + 4 Bedroom - 55.24 4 662.88 1 Bedroom + 4 Bedroom + Hot Tub - 58.36 4 700.32 2 Bedroom + 3 Bedroom - 55.22 4 662.64 2 Bedroom + Hot Tub - 29.69 28 2,493.96 4 Bedroom + Hot Tub - 33.35 156 15,607.80 5 Bedroom + Hot Tub - 34.89 135 14,130.45 6 Bedroom + Hot Tub 36.97 80 8,872.80 Unit owner associations 606.76 264 480,553.92 2,306 654,715.74
Commercial 12,883,406 9.45 31 1 121,748.19 Restaurant 370,400 162.50 20 60,190.00 Compressor, (Note a) - - -
Revenue per analysis - $ 2,637 $ 836,653.93 Correction factor 0.999930
.Revenue. - . -.. - - 836.596 Note a, Compressor revenues do not convey with the acquisition of the CMW
See independent accountants' report and summary of significant assumptions. 46 ww ww
-zc 3m 77 Pocahontas County Public Service District COMPARISON OF APPROVED TO PROPOSED TARIFFS For the year ended June 30,2016
Statement D Schedule 1
Current Increased Increase -Tariff PrODOSed Percentaae
Rates Cheat Mountain Efficiency w/o kitchen $ 11.22 $ 14.59 $ 3.37 30.0% Efficiency 12.82 16.67 3.85 30.0% 1 Bedroom 19.24 25.01 5.77 30.0% 2 Bedroom 20.44 26.57 6.13 30.0% 3 Bedroom 22.04 28.65 6.61 30.0% 4 Bedroom 23.25 30.23 6.98 30.0% 5 Bedroom 24.44 31.77 7.33 30.0% 6 Bedroom 26.04 33.85 7.81 30.0% Hot Tub 2.40 3.12 0.72 30.0% Commercial 7.27 9.45 2.18 30.0% Restaurant 125.00 162.50 37.50 30.0% Compressor, (Note a) 425.00 - (425.00) -1 00.0%
Note (a), Compressor revenues do not convey with the acquisition of the Cheat Mountain Water System.
See independent accountants' report and summary of significant assumptions 48 Pocahontas County Public Service District PUBLIC SERVICE COMMISSION OF WEST VIRGINIA "Going Level" Cheat Mountain Water System Statement D Schedule 2 Sheet 1 of 2 APPLICABILITY Applicable for entire territory serviced
AVAILABILITY Available for condo and commercial service
RATES Efficiencv w/o a kitchen $1 1.22 per unit Efficiency $12.82 per unit 1 Bedroom $19.24 per unit 2 Bedroom $20.44 per unit 3 Bedroom $22.04 per unit 4 Bedroom $23.25 per unit 5 Bedroom $24.44 per unit 6 Bedroom $26.04 per unit Hot Tub $ 2.40 per unit
Per M Gal. Commercial $7.27 Restaurant Customer Owned Wells $125.00 Compressor House Customer Owned Wells $425.00
An Efficiency is defined as a one room unit with kitchen and bedroom facilities.
Lofts, Bunkrooms or other rooms used for sleeping quarters (other than living rooms) in Residential units will be counted as Bedrooms.
Residential Hot Tub is defined as any Hot Tub, Jacuzzi, Hydra Spa or other similar type tub that is larger than the standard bathtub in either length, with or depth. Jacuzzis that are similar in size to a standard foot bathtub but have water jets will not be subject to this additional charge.
DELAYTED PAYMENT PENALITY The above tariff is net. On all current usage billings not paid within twenty (20) days, ten percent (10%) will be added to the net current amount unpaid. This delayed payment is not interest and is not to be collect only once for each bill where it is appropriate.
DISCONNECTION OR RECONNECTION CHARGE $30 TAP FEE $300.00
49 Pocahontas County Public Service District PUBLIC SERVICE COMMISSION OF WEST VIRGINIA "PRO FORMA Cheat Mountain Water System Statement D Schedule 3 Sheet 1 of 1 APPLICABILITY Applicable for entire territov serviced
AVAILABILITY Available for condo and commercial service
RATES (I) Efficiency w/o a kitchen $14.59 per unit (I) Efficiency $16.67 per unit (I) 1 Bedroom $25.01 per unit (I) 2 Bedroom $26.57 per unit (I) 3 Bedroom $28.65 per unit (I) 4 Bedroom $30.23 per unit (I) 5 Bedroom $31.77 per unit (I) 6 Bedroom $33.85 per unit (I) HotTub $ 3.12 per unit
Per M Gal.
fl\ Commercial~ ~~ $9.45 \I (I) Restaurant Customer Owned Wells $ 162.50 (0) Compressor House Customer Owned Wells $0
An Efficiency is defined as a one room unit with kitchen and bedroom facilities.
Lofis, Bunkrooms or other rooms used for sleeping quarters (other than living rooms) in Residential units will be counted as Bedrooms.
Residential Hot Tub is defined as any Hot Tub, Jacuzzi, Hydra Spa or other similar type tub that is larger than the standard bathtub in either length, with or depth. Jacuzzis that are similar in size to a standard foot bathtub but have water jets will not be subject to this additional charge.
DELAYTED PAYMENT PENALITY The above tariff is net. On all current usage billings not paid within twenty (20) days, ten percent (10%) will be added to the net current amount unpaid. This delayed payment is not interest and is not to be collect only once for each bill where it is appropriate.
DISCONNECTION OR RECONNECTION CHARGE $30
TAP FEE $300.00
(0)Indicates Omitted (I) Indicates Increase
50 Pocahontas County Public Service District ALLOCATION OF COST OF SERVICE June 30,2016 Statement E
Pocahontas County Public Service District is a multijurisdictional utility of which operations do not require apportionment of cost of services between jurisdictions. In addition, the Water Works is not seeking a departure in the rate structure approved by the Commission. Statement E is not required to be prepared according to rules for the construction and filing of tari.
See independent accountants' report and summary of significant assumptions. 51 Pocahontas County Public Service District COMPARATIVE BALANCE SHEETS June 30,2016 and 2015 Statement F Sheet 1 of 2
ASSETSANDOTHERDEBITS
June 30.2016 June 30.2015 Utility plant
101-105 Water plant $ 2,852,251 $ 2,834,693 108 Less Accum. Prov. For Deprec and Amort. 1,669,981 1,623,370
Net Water Plant 1,182,270 1,211,323
Current and accrued assets
126.1 Sinking Funds 30,113 29,340 126.2 Depreciation Funds 16,684 14,480 127 Other Special Funds 131 Cash and Working Funds 6,602 4,516 132-133 Special Deposits 5,690 4,389 134 Working Funds 2,133 - 141.I Customer Accounts Receivable 87,515 70,794 143 Accum. Provision for Uncoll. Accounts (3,000) (3,000)
Total current and accrued assets 145,737 120,519
Total assets and other debits $ 1,328,007 $ 1,331,842
See independent accountants' report and summary of significant assumptions.
52 Pocahontas County Public Service District COMPARATIVE BALANCE SHEETS (Continued) June 30,2016and 2015 Statement F Sheet 2 of 2
LIABILITIES AND OTHER CREDITS
June 30.2016 June 30,2015 Equity Capital
21 5 Retained Earnings $ 692,147 $ 696,931
Long-term debt
212 Bonds 607,065 624,663
Current and Accrued Liabilities
231 .I Accounts payable 2,543 2,542 233-23Payables to Associated Companies 17,070 235 Customer Deposits 7,750 6,200 236 Accrued Taxes 64 237 Accrued Interest 382 -392
Total current and accrued assets 27,745 9,198
Contributions in Aid of Construction
271 Contributions in Aid of Construction 1,050 1,050
Total liabilities and equity $ 1,328,007 $ 1,331,842
See independent accountants' report and summary of significant assumptions
53 Pocahontas County Public Service District COMPARATIVE STATEMENTS OF EARNED SURPLUS June 30,2016 and 2015 Statement F Schedule 1
EARNED SURPLUS
June 30.2016 June 30.2015
Earned surplus (at beginning of period) $ (969,649) $ (825,136)
Balance transfer from income account (29,149) (68,489) Adjustments to retained earnings - (76,024)
Earned surplus (at end of period) $ (998,798) $ (969,649)
See independent accountants’ report and summary of significant assumptions 54
Pocahontas County Public Service District DETAIL OF ADJUSTMENTS - GOING LEVEL As of and for the year ended June 30,2016
Statement G Schedule 1 Sheet 1 of 5 Adjustment Increase Number Goina Level Adiustments {Decrease) Statement
(1) 461.1 Metered Sales to Residential Customers $ 503,382 A, Schedule 1
Per books $ 135,779 Adjustment 1 503,382 Going level after adjustment (1) $ 639,161
To record residential revenue for Cheat Mountain customers per 2016 billings
461.2 Metered Sales to Commercial Customers $ 169,332 A, Schedule 1
Per books $ 20,109 Adjustment 2 169,332 Going level after adjustment (2) $ 189,441
To record commercial revenue for Cheat Mountain customers per 2016 billings
(3) 470 Forfeited Discounts $ 2,781 A, Schedule 1 Per books $ Adjustment 3 2,781 Going level after adjustment (3) $ 2,781 To record forfeited discounts for Cheat Mountain customers per 2016 PSC report.
(4) 471 Miscellaneous service revenues $ 2,100 A, Schedule 1
Per books $ 51 0 Adjustment 4 2,100 Going level after adjust (4) $ 2,610
To record miscellaneous service revenues for Cheat Mountain per 2016 PSC report
(5) 610.1 Purchased Water $ 66,014 A, Schedule 2
Per books $ - Adjustment 5 66,014 Going level after adjustment (5) $ 66,014
To record activity for Cheat Mountain per the 2016 PSC report
See independent accountants' report and summary of significant assumptions 56 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS - GOING LEVEL As of and for the year ended June 30,2016
Statement G Schedule 1 Sheet 2 of 5 Adjustment Increase Number Goina Level Adiustments pecrease) Statement
(6) 620.2 Materials and supplies $ 7,360 A, Schedule 2
Per books $ - Adjustment 6 7,360 Going level after adjustment (6) $ 7,360
To record activity for Cheat Mountain per the 2016 PSC
(7) 601.3 Salaries and wages- employees $ 175,971 A, Schedule 2
Per books $ 36,115 Adjustment 7 175,971 Going level after adjustment (7) $ 212,086
To record activity for Cheat Mountain per the 2016 PSC report
(8) 604.3 Employee Pensions and Benefits $ 17,983 A, Schedule 2
Per books $ Adjustment 8 17,983 Going level after adjustment (8) $ 17,983
To record activity for Cheat Mountain per the 2016 PSC report
(9) 615.3 Purchased power $ 47,723 A, Schedule 2
Per books $ 2,215 Adjustment 9 47,723 Going level after adjustment (9) $ 49,938
To record activity for Cheat Mountain per the 2016 PSC report
See independent accountants' report and summary of significant assumptions. 57 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS -GOING LEVEL As of and for the year ended June 30,2016
Statement G Schedule 1 Sheet 3 of 5 Adjustment Increase Number Goina Level Adiustments LDecrease) Statement
(10) 618.3 Chemicals $ 47,340 A, Schedule 2
Per books $ 3,524 Adjustment 10 47,340 Going level after adjustment (IO) $ 50,864
To record activity for Cheat Mountain per the 2016 PSC report
620.3 Materials and supplies $ 2,347 A, Schedule 2
Per books $ 89 Adjustment 11 2,347 Going level after adjustment (1 1) $ 2,436
To record activity for Cheat Mountain per the 2016 PSC
620.4 Materials and supplies $ 9,066 A, Schedule 2
Per books $ - Adjustment 12 9,066 Going level after adjustment (12) $ 9,066
To record activity for Cheat Mountain per the 2016 PSC
650.3 Transportation Expenses $ 3,661 A, Schedule 2
Per books $ 5,742 Adjustment 13 3,661 Going level after adjustment (13) $ 9,403
To record activity for Cheat Mountain per the 2016 PSC report
620.5 Materials and Supplies $ 808 A, Schedule 2
Per books $ 1,152 Adjustment 14 808 Going level after adjustment (14) $ 1,960
To record activity for Cheat Mountain per the 2016 PSC report See independent accountants' report and summary of significant assumptions 58 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS - GOING LEVEL As of and for the year ended June 30,2016
Schedule 1 Sheet 4 of 5 Adjustment Increase Number Goinq Level Adiustments (Decrease) Statement
(15) 620.6 Materials and Supplies $ 13,727 A, Schedule 2
Per books $ 1,635 Adjustment 15 13,727 Going level after adjustment (15) $ 15,362
To record activity for Cheat Mountain per the 2016 PSC report
620.7 Materials and Supplies $ 2,100 A, Schedule 2
Per books $ 1,135 Adjustment 16 2,100 Going level after adjustment (16) $ 3,235
To record activity for Cheat Mountain per the 2016 PSC
620.8 Materials and Supplies $ 232 A, Schedule 2
Per books $ 2,323 Adjustment 17 232 Going level after adjustment (17) $ 2,555
To record activity for Cheat Mountain per the 2016 PSC
631.8-636.8 Contractual services $ 51,114 A, Schedule 2
Per books $ 9,130 Adjustment 18 51,114 Going level after adjustment (18) $ 60,244
To record activity for Cheat Mountain per the 2016 PSC report
675.8 Miscellaneous expenses $ 14,486 A. Schedule 2
Per books $ 2,993 Adjustment 19 14,486 Going level after adjustment (19) $ 17,479
To record activity for Cheat Mountain per the 2016 PSC report See independent accountants' report and summafy of significant assumptions 59 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS - GOING LEVEL As of and for the year ended June 30,2016
Statement G Schedule 1 Sheet 5 of 5 Adjustment Increase Number Goinq Level Adiustments [Decrease) Statement
(20) Depreciation Expense $ 118,818 A, Schedule 3
Per books $ 46,611 Adjustment 20 118,818 Going level after adjustment (20) $ 165,429
To record depreciation for Cheat Mountain per the 2016
(21) 408.12 Payroll Taxes $ 54,616 A, Schedule 4
Per books $ 6,176 Adjustment 21 54,616 Going level after adjustment (21) $ 60,792
To record payroll taxes for Cheat Mountain per the 2016 PSC report
(22) 427 Other Interest Expense $ 142,752 A, Schedule 7
Per books $ 15,731 Adjustment 22 142,752 Going level after adjustment (22) $ 158,483
To record activity for Cheat Mountain per the 2016 PSC report
See independent accountants’ report and summary of significant assumptions 60 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS -PRO FORMA Statement G For the year ended 30,2016 June Schedule 2 Sheet 1 of 7 Adjustment Increase Number Pro Forma Adiustments IDecreasel Statement
461.1 Residential customers $ 151,010 A, Schedule 1
Going level $ 639,161 Adjustment (1) 151,010 Pro forma after adjustment (1) $ 790,171
To record additional revenue generated from rate increase
461.2 Commercial customers $ 12,802 A, Schedule 1
Going level $ 189,441 Adjustment (2) 12,802 Pro forma after adjustment (2) $ 202,242
To record additional revenue generated from rate increase.
(3) 470 Forfeited Discounts $ 535 A, Schedule 1 Going level $ 2,781 Adjustment (3) 535 Pro forma after adjustment (3) $ 3,316
(a) Revenue at going level $ 852,240 (b) Revenue at pro forma 1,016,053 (c) Forfeited discounts at going level. 2,781 Forfeited discounts at pro forma 3,316 (B/A) X C
To record the estimated additional forfeited discounts from increased rates.
601.3 Salaries &Wages - Employees $ (15,461) A, Schedule 2
Going level $ 212,086 Adjustment (5) (15,469 Pro forma after adjustment (5) $ 196,625 To record change in Salaries & Wages - Employees 604.3 Employee Pension 8 Benefits $ 84,877 A, Schedule 2
Going level $ 17,983 Adjustment (6) 84,877 Pro forma after adjustment (6) $ 102,860 To record Employee Pension & Benefits 650.3 Transportation Expenses $ 4,375 A, Schedule 2
Going level $ 9,403 Adjustment (7) 4,375 Pro forma after adjustment (7) $ 13,778
To record Transportation Expenses See independent accountants' report and,.- summary of significant assumptions Pocahontas County Public Service District DETAIL OF ADJUSTMENTS PRO FORMA - Statement G For the year ended June 30,2016 Schedule 2 Sheet 1 of 7 Adjustment Increase Number Pro Forma Adiustments {Decrease) Statement
(8) 601.8 Salaries &Wages - Employees $ 13.819 A. Schedule 2
Going level $ 13,819 Adjustment (8) 13,819 Pro forma after adjustment (8) $ 27,638
To record Salaries & Wages - Employees
( 9) 604.8 Employee Pensions & Benefits $ 17,647 A, Schedule 2
Going level $ 17,647 Adjustment (9) 17,647 Pro forma after adjustment (9) $ 35,294
To record Employee Pension & Benefits
(10) 659.8 Insurance - Other $ 20,000 A, Schedule 2
Going level $ Adjustment (IO) 20,000 Pro forma after adjustment (IO) $ 20,000
To record Insurance - Other
(11) 427 Other Interest Expense $ (142,752) A, Schedule 7
Going level $ 158,483 Adjustment (11) (142,752) Pro forma after adjustment (1 1) $ 15,731
To remove interest charged by Snowshoe
(12) 408.12 Taxes Other Than Income $ (38.813) A, Schedule 4 Going level $ 60,792 Adjustment (12) (38,813) Pro forma afler adjustment (12) $ 21,979
To remove West Virginia 680 taxes which are not applicable to the District
(13) 304.3 Structures and improvements $ 145,090 B. Schedule 1
Going level $ 203.646 Adjustment (13) 145,090 Pro forma afler adjustment (13) $ 348,736 To record the acquisition of the Cheat Mountain Water System
See independent accountants' report and summary of significant assumptions. 62 Pocahontas County Public Service District DETAIL ADJUSTMENTS PRO FORMA OF - Statement G For the year ended June 30,2016 Schedule 2 Sheet 1 of 7 Adjustment Increase Number Pro Forma Adiustments 1Decrease) Statement (14) 320.3 Water treatment equipment $ 853,470 B, Schedule 1
Going level $ 890,242 Adjustment (14) 853,470 Pro forma after adjustment (14) $ 1,743,712
To record the acquisition of the Cheat Mountain Water System
339.3 Other Plant and Miscellaneous Equipment $ 261,324 6,Schedule 1 Going level $ Adjustment (15) 281,324 Pro forma after adjustment (15) 281,324
To record the acquisition of the Cheat Mountain Water System
31 1.4 Pumping equipment $ 279,979 6,Schedule 1 Going level $ Adjustment (16) 279,979 Pro forma after adjustment (16) 279,979
To record the acquisition of the Cheat Mountain Water System
330.4 Distribution reservoirs and standpipes $ 360,016 B. Schedule 1 Going level $ 12,266 Adjustment (17) 360,016 Pro forma after adjustment (17) 372,282
To record the acquisition of the Cheat Mountain Water System
331.4 Transmission and distribution mains $ 192,144 B, Schedule 1 Going level $ 935,704 Adjustment (18) 192,144 Pro forma after adjustment (18) 1,127,848
To record the acquisition of the Cheat Mountain Water System
340.5 Office furniture and equipment $ 4,297 6,Schedule 1 Going level $ 6,827 Adjustment (19) 4,297 Pro forma after adjustment (19) 11,124
To record the acquisition of the Cheat Mountain Water System
341.5 Transportation equipment $ 120,297 B, Schedule 1 Going level $ Adjustment (20) 120,297 Pro forma after adjustment (20) 120,297
To record the acquisition of the Cheat Mountain Water System See independent accountants' report and summary of significant assumptions 63 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS PRO FORMA - Statement G For the year ended June 30,2016 Schedule 2 Sheet 1 of 7 Adiustment Increase Pro Forma Adiustments [Decrease) Statement 344.5 Laboratory equipment $ 11,565 B, Schedule 1 Going level $ Adjustment (21) 11,565 Pro forma after adjustment (21) 11,565
To record the acquisition of the Cheat Mountain Water System
348.5 Other tangible plant $ 32,517 8, Schedule 1 Going level $ Adjustment (22) 32,517 Pro forma afler adjustment (22) 32,517
To record the acquisition of the Cheat Mountain Water System
(23) 347.5 Miscellaneous equipment $ 65,000 6, Schedule 1 Going level $ Adjustment (23) 85,000 Pro forma after adjustment (23) 85,000
To record the acquisition of the Cheat Mountain Water System
(24) 403 Depreciation expense $ 22,696 A, Schedule 3 Going level $ 165,429 Adjustment (24) 22,696 Pro forma after adjustment (23) 188,125
To record additional deprecation expense from the acquisition
Series 2017A Bond $ 141,605 C, Schedule 2 Going level $ Adjustment (25) 141,805 Pro forma after adjustment (25) 141,805
To record debt service for Series 2017 A Bond.
Bank Loan $ 56,506 C. Schedule 2 Going level $ Adjustment (26) 56,506 Pro forma after adjustment (26) 56,506
To record the bank loan associated with transportation and other equipment acquisition.
See independent accountants' report and summary of significant assumptions. 64 Pocahontas County Public Service District DETAIL OF ADJUSTMENTS PRO FORMA - Statement G For the year ended June 30,2016 Schedule 2 Sheet 1 of 7 Adjustment Increase Number Pro Forma Adiustments (Decrease) Statement
(27) 610.1 Purchased Water A, Schedule 2 Going level $ 66,014 Adjustment (27) (66,014) Pro forma after adjustment (27)
To remove purchased water, current acquisition agreement states that the PSD will not be charged for water taken from the lake.
See independent accountants' report and summary of significant assumptions. 65 Pocahontas County Public Service District SUMMARY OF SIGNIFICANT ASSUMPTIONS For the year ended June 30,2016 PER BOOKS
The per books operating revenues, operation and maintenance expenses, other income, and other income deductions are based on the West Virginia Public Service Commission Annual Report for the fiscal year ended June 30,2016 which is considered as the "base year".
GOING LEVEL
Going level adjustments add the operating revenues, operation and maintenance expenses, other income, and other deductions of the Cheat Mountain Water Company, Inc. based on the West Virginia Public Service Commission Annual Report for the fiscal year ended June 30,2016. Thus, going level would simply represent summation of the activity of both Pocahontas County Public Service District and Cheat Mountain Water Company, Inc.
PRO FORMA
Pro forma adjustments provide for the acquisition of the Cheat Mountain Water Company, Inc., certain deferred maintenance requirements, and additional equipment which will be required by the District to operate the combined system effectively and efficiently.
Water System: The Pocahontas County Public Service District negotiated the acquisition of the Cheat Mountain Water Company, Inc. for $800,000 from the Snowshoe Mountain, Inc. The acquisition price is below the stated net utility plant book value of the June 30, 2016 annual report of $1,404,554.
Project: The District's engineers, E.L. Robinson, with the assistance of the District's Board, Management, and Cheat Mountain Water Company representatives compiled a list of deferred maintenance, betterments, and equipment acquisition which is required to operate the system effectively. These items are listed on the next page.
Funding and rates: With this submission, the District is requesting from the West Virginia Infrastructure and Jobs Development fund, a 20 year bond in the original amount of $2,109,700 with 3% interest. Pro forma adjustment reflects the annual debt service of this issuance.
The District will be requesting bank funding of $256,000 for acquisition of transportation and other equipment which have short lives. The District believes it can obtain financing through a bank for 5 years at 3.95% interest rate. Pro forma adjustment reflects the annual debt service of the this bank loan.
Pro forma adjustments 5 through 10, consist of adjustments of various operating and maintenance costs according to the consulting engineer's engineering report. Pro forma adjustment 12 reflects the reduction of certain taxes which are not applicable to the District.
66 Pocahontas County Public Service District SUMMARY OF SIGNIFICANT ASSUMPTIONS For the year ended June 30,2016
PRO FORMA (Continued)
Pro forma adjustment 27, represents the reduction of water purchased for the base year. The District negotiated that it can draw water from Snowshoe Mountain, Inc. at no charge.
Pro forma adjustment 11, removes interest paid by Cheat Mountain Water Company to Snowshoe Mountain, Inc.
Adjustments 1 through 3 record the additional revenue earned and forfeited discounts resulting from the proposed rate increase.
The District's engineers, E.L. Robinson Engineering, and personnel have estimated the cost and financing of the following items:
Acquisition $ 800,000 Acquisition engineering, legal, accounting. survey, administration, etc. 486,000 SCDA 200,000 Fencing 98,000 Pumps, meters, and values 239,000 Generator 170,000 Transportation equipment 117,000 Excavator and trailer 85,000 Trailer mounted generator 54,000 General repairs and contingency 116,700 2,365,700
Amount financed through 20 year 3% interest 2017 A bond $ 2,109,700
Amount financed through 5 year 3.95 bank note 256,000
$ 2,365,700
67 POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT WATER - PROPOSED RATES [DRAFT}
APPLICABILITY Applicable for entire territory serviced
AVAILABILITY OF SERVICE Available for condo and commercial service
RATES Efficiency wio a kitchen $ 14.59 per unit Efficiency $ 16.67 per unit 1 Bedroom $ 25.01 per unit 2 Bedroom $ 26.57 per unit 3 Bedroom $ 28.65 per unit 4 Bedroom $ 30.23 per unit 5 Bedroom $ 3 1.77 per unit 6 Bedroom $ 33.85 per unit Hot Tub $ 3.12 per unit
Per M Gal. Commercial $ 9.45 Restaurant Customer Owned Wells $ 162.50 Compressor House Customer Owned Wells $ 0.00
An Efficiency is defined as a one room unit with kitchen and bedroom facilities.
Lofts, Bunkrooms or other rooms used for sleeping quarters (other than living rooms) in Residential units will be counted as Bedrooms.
Residential Hot Tub is defined as any Hot Tub, Jacuzzi, Hydra Spa or other similar type tub that is larger than a standard bathtub in either length, width or depth. Jacuzzis that are similar in size to a standard foot bathtub but have water jets will not be subject to this additional charge.
Commercial Unmetered (Available only to those customers currently billed under this tariff) each unmetered Commercial customer will remain under the rates as existing prior to the filing of this case until the time meters are installed.
DELAYED PAYMENT PENALTY The above tariff is net. On all current usage billings not paid within twenty (20) days, ten percent (10%) will be added to the net current amount unpaid. This delayed payment penalty is not interest and is not to be collected only once for each bill where it is appropriate.
DISCONNECTION OR RECONNECTION FEE $30.00
TAP FEE $300.0 P.S.C. W. Va. No. 1
~ Cheat Mountain Water Company, Inc., a private utility
of
Snowshoe, West Virginia
RATES,RULES AND REGULATIONS FOR FURNISHING WATER
At Snowshoe Resort, Silver Creek Lodge and Silver Creek County, West Virginia
Filed with THE PUBLIC SERVICE COMMI of WEST VIRGINIA
.*"I Issued March 3 1,2009 Effective for service rendered on or after March 25,2009 or as otherwise provided herein
Issued by authority of an Order of The Public Service Commission of West Virginia in Case No. 09-01 16-W-NC dated March 25,2009 or as otherwise provided herein
Issued by Cheat Mountain Water Company, Inc., a private utility CHEAT MOUNTAIN WATER COMPANY, INC. P.S.C. W.VA. Tariff No. 1 Original Sheet No. 2
Cheat Mountain Water Company, Inc.
AF'PLICABILITY Applicable for entire territory serviced
AVAILABILITY OF SERVICE Available for condo and commercial service
RATES Efficiency wlo a kitchen $1 1.22 per unit Efficiency $12.82 per unit 1 Bedroom $19.24 per unit 2 Bedroom $20.44 per unit 3 Bedroom $22.04 per unit 4 Bedroom $23.25 per unit 5 Bedroom $24.44 per unit 6 Bedroom $26.04 per unit Hot Tub $ 2.40 per unit
Per M Gal. Commercial $ 7.27 Restaurant Customer Owned Wells $125.00 Compressor House Customer Owned Wells $425.00
An Efficiency is defined as a one room unit with kitchen and bedroom facilities.
Lofts, Bunkrooms or other rooms used for sleeping quarters (other than living rooms) in Residential units will be counted as Bedroom.
Residential Hot Tub is defined as any Hot Tub, Jacuzzi, Hydra Spa or other similar type tub that is larger than a standard bathtub in either length, width or depth. Jacuzzis that are similar in size to a standard foot bathtub but have water jets will not be subject to this additional charge.
Commercial Unmetered (Available only to those customers currently billedunder this tariff) each unmetered Commercial customer will remain under the rates as existing prior to the filing of this case until the time meters are installed. CHEAT MOUNTAIN WATER COMPANY, MC. P.S.C. W.VA. Tariff No. 1 Original Sheet No. 3
DELAYED PAYMENT PENALTY The above tariff is net. On all current usage billings not paid within twenty (20) days, ten percent (10%) will be added to the net current amount unpaid. This delayed payment penalty is not interest and is not to be collected only once for each bill where it is appropriate.
DISCONNECTION OR RECONNECTION FEE $30.00
TAP FEE $300.00 Joint Petition PUBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON
CaseNo. 17- -w-- POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT and CHEAT MOUNTAIN WATER COMPANY, INC.
Joint Petition for Approval of Transfer of Assets of Cheat Mountain Water Company, Inc. to Pocahontas County Public Service District; for Certificate of Public Convenience and Necessity for New Facilities; and for related relief
JOINT PETITION
Pocahontas County Public Service District (“m’)and Cheat Mountain Water Company, Inc. (“w)seek Commission approval under W. Va. Code $5 24-2-1 1 and 24-2-
12 for the District (i) to acquire CMW’s existing water utility assets (“Transaction”); (ii) to
acquire and construct certain new facilities (“New Facilities”) with a portion of the proceeds of
certain proposed District borrowings (“W’),all pursuant to a certificate of public
convenience and necessity requested in this filing (“Certificate”); and (iii) to implement a rate
increase, applicable only to the former CMW customers, needed to facilitate the Transaction and
the acquisition of the New Facilities (“Rate Increase”). Petitioners assert that the Transaction
will not adversely affect the public or the continuous provision of reliable water service to
CMW’s current customers at just and reasonable rates. District also asserts that the acquisition
and construction of the New Facilities are necessary and convenient to the operation of the water
system after the Transaction, and that the Loans and the Rate Increase are necessary and appropriate to the completion of the Transaction and operation of the water system at just and
1 reasonable rates, To permit a calendar-quarter closing on December 3 1, 201 7,’ Petitioners request that the Commission retain this case and enter an order granting the requested relief by
December 21,201 7
Parties
1, District and CWM are West Virginia water utilities. District owns and operates a public water system serving approximately 270 customers in Pocahontas County, excluding the corporate limits of Marlinton and Hillsboro and the Snowshoe and Silver Creek Resorts in
Snowshoe, West Virginia owned by Snowshoe Mountain, Inc. (‘‘W’).District’s business address is 1020 Snowshoe Drive, Slatyfork, West Virginia 26291. It is represented by:
Christopher D. Negley, Esq. (State Bar No. 6086) [email protected] Shuman, McCuskey & Slicer 141 1 Virginia Street, East - Suite 200 Charleston, WV 25301 Telephone: (304) 345-1400
The Commission approved the first step needed to complete the Transaction when it approved the Pocahontas County Commission’s request to enlarge District’s boundaries to encompass the
Snowshoe and Silver Creek areas. Pocahontas County Commission, Case No. 16-1270-
PWD-PC (Recommended Decision dated January 11, 2017; Final Order entered January 31,
20 17)
2. CMW is a public utility incorporated in West Virginia that provides water service to approximately 600 residential and commercial customers in and around Snowshoe, West
Virginia. Its business address is 10 Snowshoe Drive, Snowshoe, West Virginia 26209. CMW is wholly-owned by SMI. CMW is represented by:
1 In paragraph 23 below, Petitioners explain why a Closing Date immediately before a calendar quarter will streamline the Transaction from a customer billing perspective.
2 Christopher L. Callas, Esq. (State Bar No. 5991) [email protected] Nicklaus A. Presley, Esq. (State Bar No. 12293) [email protected] Jackson Kelly PLLC P. 0. Box 553 Charleston, WV 25322 Telephone: (304) 340-1000
3. District, CMW and SMI have discussed the feasibility of transferring CMW’s
water system (‘‘=’) to the District since late 2015. SMI has no special desire to operate a
public water utility; it has developed, operated, and maintained the System over time through
CMW only to ensure water service to SMI and the businesses, homeowners’ associations, and
individuals in the Snowshoe and Silver Creek Resort areas. Looking forward, Petitioners
recognize that future capital improvements to the System, including the eventual replacement of
CMW’s existing water treatment plant, could likely be financed more cost-effectively if the
system were owned by District. District has the operational, technical, managerial, and financial capabilities to operate the System as a component of its public water system
Transaction
4. Under an Asset Purchase Agreement dated May 25, 2017, among CMW, SMI, and the District (“m’),District will acquire from CMW and operate all of CMW’s public utility assets (“CMW Assets”), and also will acquire from SMI certain additional assets owned by SMI that will facilitate District’s operation of the System (“SMI Assets”). A copy of the APA is attached as Exhibit A to this Petition. Exhibits A and B to the APA provide comprehensive listings of each category of assets.
5. In consideration of these transfers, District will pay to CMW $800,000.00 at closing (the “Closinn Date,” targeted for December 31, 2017), which represents an agreed
3 reasonable estimate of the net book value of the CMW Assets on the Closing Date, subject only
to potential adjustment for any emergency or immediately necessary capital investments that
CMW may make, in consultation with District, between the APA execution date and the Closing
Date. See APA at 5 2.
6. In addition to the APA’s terms, there are three other agreements exhibited to the
APA (“Ancillary Agreements”) that SMI and District intend to execute on the Closing Date.2
These include:
a. the Joint Use Agreement (APA Exhibit C), under which SMI and District agree to
allocate raw water withdrawal rights in the Shavers Fork impoundment (CMW’s
current source of supply) without charge to District and to apportion cost
responsibility for maintenance of the intake and related facilities that SMI will
continue to own;
b. the Property Exchange and Disposition Agreement (APA Exhibit D), under which
SMI and District provide for the eventual relocation of the water treatment plant
from its existing location to an identified new location (“Relocation”) and, after
construction and commissioning of the new plant, District’s re-conveyance of the
existing plant and backwash facility sites (“Existing Sites”) to SMI; and
c. the Access Agreement (APA Exhibit E), under which SMI and District agree to
share certain facilities and provide reasonable ongoing access to certain areas to
facilitate their respective operations. APA at p. 2.
2 Because they do not involve a transaction between affiliates or utilities, the Ancillary Agreements themselves are not Commission-jurisdictional under $24-2-12. They do explain, however, how SMI and District propose to address important going-forward issues.
4 7. District, CWM, and SMI have also agreed to terms governing pre-closing date
operations, final meter readings and billing protocols, and post-Closing Date commitments
addressing District’s employment of CMW employees and District’s decommissioning of the
Existing Sites incident to the Relocation. See APA at 17 5, 8, and 10, pp, 3 - 6.
8. The Parties anticipate that the $800,000 consideration under the APA will be less
than the net book value of the CMW Assets (projected to be $1,081,162 as of December 31,
2017).3 The $800,000 consideration will also be considerably less that the projected December
31, 2017 aggregate net book value of the CMW Assets and the SMI Assets, which SMI will
contribute at zero cost. Despite these facts, the Parties do not ask that a positive acquisition
adjustment be recorded on District’s books. All Parties believe that these elements of
consideration are fair and reasonable.
Financing
9. The Funding Committee of the Infrastructure and Jobs Development Council
approved District’s application (Project No. 2017 W-1697) on May 31, 2017, and the full
Council took final action to approve the application on June 10,2017.
10. In addition its financing of the Transaction cost, District proposes to acquire and
construct the New Facilities, which are composed of SCADA facilities, fencing, and a number of
electric service continuity facilities. The estimated project cost components are set forth in Table
-1 below.
3 Exhibit B to this Joint Petition details CMW’s utility plant accounts as of June 30, 2017, and as projected for December 31,2017.
5 I Acquisition component I 1 Acquisition price 1$800,000 1 Engineering, legal, accounting, survey, administration, etc. 1$486,000 District Facilities comoonent I 1 SCADA I$200.000 I I I Fencing 1$98.000 I ______~1 Pumps, meters, and valves Generator $170,000 Transportation equipment $117,000 Excavator and trailer $85,000 Trailer mounted generator $54,000 General repairs and contingency $116,700 $2,365,700
6 No. 14, which includes the proposed form of notice of the filing, the request for a Certificate, and
the details of the Rate Increase.
Request for Certification if Deemed Necessary
13. District has determined that the New Facilities, individually and as a whole, are
minor in scope (fencing, SCADA improvements, generators, and vehicles) and should be
considered as “ordinary extensions of existing systems in the usual course of business” within
the meaning of W. Va. Code 524-2-1 1, and thus not require a certificate of public convenience
and necessity under that section. District asserts that this treatment is especially appropriate
because District would not undertake the New Facilities absent the Transaction, and also because
the Commission will review the New Facilities as part of its review of this filing.
14. Nevertheless, Staff has advised that under the circumstances presented, it believes
District should obtain the Certificate for the New Facilities. Accordingly, District asserts that
the New Facilities are both convenient and necessary; and if the Commission determines that a
Certificate is required for the New Facilities, then District requests that the Commission grant the
Certificate. As noted above, the filing letter incorporates a completed checklist for the
Certificate portion of this filing, with integral attachments corresponding to the applicable
material specified in Procedural Rule 26.
No Adverse Irnuact on Public
15. The Transaction and District’s subsequent operation of the System will have no material adverse impact on CMW’s existing customers or the State as a whole.
a. Management of the District Assets. The Transaction will not adversely affect the
current management of, or management personnel currently involved with,
District’s existing water utility operations. b. Employees. The Transaction will have no adverse impact on existing CMW
employees. District has committed (APA 5 lO(b)) to employ four of the five
operators currently employed by CMW at salary and benefit levels consistent with
District’s existing compensation structure.
C. Current Rates for CMW Customers. The Transaction will have only a minor
impact on the rates and charges of current CMW customers, and no impact on
existing District customers. This minor rate impact may bc orfset in the future as
new rates for District are made from time to time, and when District eventually
constructs the new treatment plant, customers will benefit from District’s use of
an overall cost of capital terms likely to be more favorable than that which CMW
would otherwise be able to deploy for that purpose.
d. Customer Service Levels. No changes in customer service levels are expected to
arise, either to CMW’s existing customers or District’s existing customers.
e. Consolidation of Operations. District will maintain its office facilities at the 1020
Snowshoe Drive location, managing all its operations from that location.
16. CMW requests that the Commission waive the requirements of Procedural Rules
21.1 and 21.2 to provide CMW financial information. CMW’s historic financial condition is not relevant to the Transaction. However, CMW recognizes that the net book value of the CMW
Assets is relevant.
Bases for Approval of Transaction under W. Va. Code 6 24-2-12
17. To approve a 524-2-12 petition, the Commission must determine that “the terms and conditions are reasonable and that neither party thereto is given an undue advantage over the other, and do not adversely affect the public in this state.” The Transaction meets this test.
8 18. The terms of the Transaction as specified in the APA are reasonable, including the
purchase price. The Transaction is the result of an arm’s length negotiation and due diligence
process among sophisticated parties. Each party to the APA will give customary representations
and warranties to the others.
19. No party had an undue advantage over the others in the negotiation of the APA,
and its implementation will not result in any party having an undue advantage over any other.
20. The Transaction will have no adverse effect on the public in West Virginia or
current CMW and District customers.
21. No public utilities in West Virginia other than the District and CMW will be
affected by the Transaction.
Benefits of the Transaction
22. The Transaction will ensure that a well-run public water utility will continue to provide water service to current CMW customers, with an enhanced access to low cost loans for future infrastructure replacement and renewal efforts.
23. Paragraph 8 of the APA describes the complex series of steps the Parties have outlined to accommodate final meter readings and customer bills. CMW has both metered and flat rate customers. For metered customers, CMW bills certain customers in arrears on a quarterly basis; CMW’s flat rate customers, on the other hand, are all billed monthly in advance of receiving service. Transitioning all of these customers and their varying billing formats to
District, which intends to bill all of its existing and new customers in the same manner, will be much more difficult if the Closing Date occurs on a date other than the last day of a calendar quarter. This outcome would require District’s retention in trust of, final accounting for, and remission to CMW of amounts relating to CMW’s pre-Closing Date provision of service - all
9 efforts that CMW and District have attempted to avoid. For these reasons, Petitioners encourage the Commission to enter an order granting the requested relief not later than December 21,201 7, a date that will permit a closing on December 31,2017
Requested Relief
24. For these reasons, Petitioners believe the Transaction is reasonable under the circumstances and otherwise satisfies the requirements of W. Va. Code 5 24-2-12, and District believes that the New Facilities, the Loans, and the Rate Increase are likewise reasonable and meet the requirements of W. Va. Code 5 24-2-11. Petitioners respectfully request that the
Commission:
a. approve the Transaction as described in the APA and on the terms specified in this Petition; b. waive Procedural Rules 21.1 and 21.2 for CMW;
C. authorize District to own and operate the System at the rates and charges for existing CMW customers specified in Checklist Items 26.3 and 26.16; d. determine that the New Facilities do not require the Certificate, or in the alternative grant the Certificate and approve the Loans and the Rate Increase; e. retain this case and establish a procedural schedule that will enable the Commission to enter a final order not later than December 21,201 7; f. direct the District and CMW to publish notice of this filing, the request for the Certificate, and the anticipated impact of the Rate Increase, substantially in the proposed form provided as Checklist Item 26.16; waive hearing on the Joint Petition if no substantial protest is received; and grant such additional authorizations, waivers, approvals, and other relief as may be necessary or appropriate.
10 Respectfully submitted this 24"' day of August, 2017.
POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT and CHEAT MOUNTAIN WATER COMPANY. INC.
By Counsel
Christopher D. Negley, WV Bar ID 6086 SHUMAN, MCCUSKEY & SLICER, PLLC 141 1 Virginia Street, East - Suite 200 Charleston, WV 25301 (304) 345-1400
Counsel for Pocahontas County Public Sesvice District
(22d dp,@,>.., (SN Christouher L. Callas. WV Bar ID 5991 Nicklads A. Presley, WV Bar ID 12293 JACKSONKELLY PLLC 1600 Laidley Tower Post Office Box 553 Charleston, West Virginia 25322 (304) 340-1251
Counselfos Cheat Mounlain Water Cornpuny, Inc
11 INDEX OF EXHIBITS
Exhibit A Asset Purchase Agreement
Exhibit B Schedule detailing CMW’s existing utility plant accounts as of June 30,2017, and as projected for December 3 1,2017 VERIFICATION
STATE OF WEST VIRGINIA,
COUNTY OF POCAHONTAS, to-wit:
:,+ \A\%.. 4\.. c< k'> 4.>\ "i, , an authorized officer of the Pocahontas County Public
Service District, being duly sworn, says that the factual assertions on behalf of Pocahontas
County Public Service District in the attached Joint Petition are true to the best of his knowledge, information, and belief.
Taken, subscribed and sworn to before me by ~
201 7.
My commission expires: VERIFICATION
STATE OF WEST VIRGINIA,
COUNTY OF POCAHONTAS, to-wit:
Frank DeBerry, an authorized representative of Cheat Mountain Water Company, Inc., being duly sworn, says that the factual assertions on behalf of Cheat Mountain Water Company,
Inc. in the attached Joint Petition are true to the best
I
Taken, subscribed and sworn to before me bdyb /ii\ (2,,I on August 232017. J\#*I -!l---Y My commission expires: 1 v j '( ,J / /1 A ASSET PURCHASE AGREEMENT f-b ASSET PUJCHASE AGREEMENT dated as of May 2017 among Cheat Mountain Water Company (“e):Snowshoe Mountain Inc. (‘‘U,‘’ and together with CMW, “w),and Pocahontas County Public Service District (“District,” and together with Sellers, the “m). Recitals A. CMW and District are public water utilities regulated by the Public Service Commission of West Virginia (“psc“). CMW is a subsidiary of SMI, which owns and operates a resort in Snowshoe, West Virginia. B. CMW wishes to sell its water utility operations and assets to District (“Svstem:’). and District wishes to buy those operations and assets. SMI has agreed to transfer to District certain SMI-owned assets to be used in District‘s water utility operations. To specify the terms of these agreements (collectively, the ”Transaction”), the Parties enter into this agreement (inclusive of its exhibits. the “Agreenient”). C. CMW and District intend to seek PSC approval of the Transaction and the Agreement to the extent required. D. In consideration of the mutual promises in this Agreement, the Parties agree to the following terms:
1) Components of Transaction. On the Closing Date (defmed below), a) CMW will sell and District will purchase all of the public utility assets owned by CMW and used and useful in CMW‘s current provision of water utility service (“m Ouerations”). comprised of the assets specified in Exhibit A. but excluding those assets specified in that exhibit (the “CMW Assets”); b) SMI will transfer to District the additional assets and rights owned by SMI and necessary or convenient to District’s operation of the System, comprised of the assets specified in Exhibit B: but excluding those assets specified in that exhibit (the “SMI Assets,” and together with the CMW Assets, the “Transferred Assets”); and c) SMI and District will execute three ancillary agreements (“Ancillary Arreements”):
4833-6945-8249.” 1 i) The Joint Use Agreement, substantially in the form attached as Exhibit C, under which SMI and District agree to an allocation of (i) raw water withdrawal rights in the Shavers Fork impoundment without charge, based on a projected 1.44 MGD maximum daily use and a 0.5 MGD average annual daily use for District, and (ii) cost responsibility for maintenance to the raw water intake and related facilities to be owned by SMI: ii) The ProDertv Exchange and Disuosition Agreement, substantially in the form attached as Exhibit D, under which SMI and District provide for (i) the future conveyance of real property interests for nominal consideration incident to the expected relocation of the District water treatment plant (“Relocation”) from its existing location to an identified new location. reserving to SMI a parking easement and certain access rights; and (ii) District‘s re-conveyance of the existing plant site and backwash facility site to SMI; and iii) The Access Agreement, substantially in the form attached as Exhibit E, under wluch Sh4I and District agree to share certain facilities and provide reasonable ongoing access to certain areas to facilitate their respective operations. d) CMW will assign to District all mainline extension agreements or alternate mainline extension agreements under which CMW or the counterparty have unexercised rights or remaining obligations. 2) Consideration. The following consideration will be offered and accepted among the Parties on the Closing Date. a) District will pay to CMW $800,000 in immediately available funds, representing an agreed reasoMblC estimate of the net book value of the CMW Assets on the Closing Date, subject to adjustment for any emergency or immediately necessary capital investments that CMW may make in consultation with District between this Agreement’s execution and the Closing Date. District and CMW will prorate as of the Closing Date any taxes or other System-related costs. b) District and SMI will execute and deliver the Ancillary Agreements. c) CMW will convey to District the CMW Assets, free and clear of all liens and encumbrances other than any permitted liens specified in Exhibit A, by appropriate bills of sale.
2 4833-6945-8249.v I d) SMI will convey to District the SMI Assets, free and clear of all liens and encumbrances other than any permitted liens specified in Exhibit B, by appropriate deeds or bills of sale. 3) m.Closing of the Transaction will occur on September 30, 2017, or such later and mutually convenient date within 60 days of the date on which the last of the conditions precedent has occurred (in either case, the “Closing Date”). 4) Cooperation. The Parties will cooperate with each other and third parties, make such commercially reasonable efforts as may be necessary to timely seek and obtain (i) a final order of the PSC approving the Transaction and this Agreement, without any terms, conditions, or limitations that, in the opinion of any Party, adversely affect the economic feasibility of the Transaction (“PSC ADoroval”); and (ii) any other approvals or waivers required to close the Transaction. 5) Ooerations Prior to ClosinE Date. Up to and through the Closing Date, CMW will: a) Provide District with reasonable access to the System’s physical assets, design and engineering drawings, books and records, and the like; b) Operate its business in the normal course and in a manner consistent with prudent utility practice and applicable law, c) Maintain compliance with all permits and approvals, and honor all contractual obligations; and d) Not dispose of assets, change employee compensation levels other than in the ordinary course, or obligate itself to material financial or operational commitments without District’s written consent. 6) Expenses of Transaction. Each Party 41pay its own expenses incurred in connection with the Transaction 7) Non-Assmution of Liabilities; Indemnification. a) Except for the obligation to make refunds under routine extension agreements to the extent they exist at the Closing Date, District will not assume any other liabilities or debts of CMW, including any liabilities or debts owed to vendors, consultants, attorneys, engineers, accountants, suppliers, governmental entities, repairmen, and contractors. b) AlJ other debts and Liabilities of CMW will be settled prior to or at Closing, and any debts not settled at Closing will remain solely the obligation of CMW.
3 48334945.8249.~i c) CMW will indemnify and hold harmless District for any (i) claims of loss or damage, including claims of violation of environmental laws, to the extent arising from its ownership or operation of the System through the Closing Date; (ii) claims arising from a breach of any representation, warranty, covenant, or obligation under the Defhtive Agreement or the Ancillary Agreements; and (iii) claims relating to any pre-Closing liability of CMW. The maximum potential indemnification obligation shall be $250,000. These indemnification rights constitute the sole and exclusive remedy with respect to these claims, and apply only to eligible claims made within two years of the Closing Date. d) Only to the extent of District’s applicable insurance coverage, District will indemnify and hold harmless Sellers for any (i) claims of loss or damage, including claims of violation of environmental laws, to the extent arising from District’s ownership or operation of the System on or after the Closmg Date; or (ii) claims arising fiom a breach by District of any representation, warranty, covenant, or obligation under this Agreement or the Ancillary Agreements. These indemnification rights constitute the sole and exclusive remedy with respect to these claims, and apply only to eligible claims made within two years of the Closing Date. 8) Final Meter Readings and Billing (based on September 30,2017 Closing Date). a) Two weeks prior to the Closing Date, CMW will provide a complete, accurate list of its then-current customers, including the name, service address, mailing address, telephone number, and similar identifying information. b) Final billing protocol for CMW customers (“Final CMW Bills”): i) Metered customers. During the five business days before the Closing Date, CMW will read all meters for those customers it bills quarterly in arrears, pro-rate an additional amount from the meter reading date and through and including the Closing Date, and issue final bills to those customers reflecting the aggregate of those two
am0UntS. ii) Flat rate customers. For CMW customers billed at a flat rate in advance of the provision of service, CMW will issue final bills to those customers, calculated on the basis of a full month of service or, as necessary, on a shorter pro-rated period
4 4333-6945-8249.v 1 reflecting the number of days, inclusive between the final billing date and the Closing Date. c) CMW will be entitled to collect and retain all amounts paid directly to CMW on the Final CMW Bills, including any past due amounts for preceding months that are paid with the final bill amounts. d) District will begin its own metering, billing, and collection efforts beginning with service provided on the day following Closing Date (expected to be October 1,2017). e) Subject only to subparagraph (c) above, District will be entitled to retain any amounts received from customers that are paid directly to District, whether those amounts are associated with service provided before or after the Closing Date, without reimbursement obligation lo CMW. Nowithstanding the preceding sentence, District will retain and remit to CMW any amounts received on Final CMW Bills that customers mistakenly send to District. f) To the extent the Closing Date is not September 30, 2017, CMW and District will negotiate a suitable plan to undertake fdmeter reading, billing, and collection activities. which may involve District’s retention in trust of, final accounting for, and remission to CMW of amounts relating to CMWs pre-Closing Date provision of service. 9) Further Assurances. Each Party agrees that it will without hrther consideration execute and deliver such other documents and take such other action, whether prior or subsequent to Closing, as may be reasonably requested by another Party to consummate more effectively the purposes of this Agreement. 10) Other Post-Closing Date Commitments. In addition to the commitments specified in the Ancillary Agreements: a) District will provide water service under the tariff provisions of CMW until such time as the PSC establishes new rates and charges for District’s water service. b) District will employ four of the five operators currently employed by CMW at the salary and benefit levels consistent with District’s existing compensation structure. c) District will arrange for the installation of new electrical service to District for the raw water pump station and, if necessary, the installation of separate metered electrical service (or comparable arrangements) in other locations.
5 4833-6945-8249.~1 d) Incident to the Relocation, District will, at its own expense, demolish and remove below- grade construction at the existing treatment plant site, including foundation walls, and footings, tanks, etc., to 24 inches below grade, and then bacMill voids with compacted #57 aggregate. SMI will provide such additional easements and access as may reasonably be needed for this purpose. e) District will determine whether the water tank at the Inn at Snowshoe is to be retained or decommissioned; if it is to be decommissioned, District will, at its own expense, undertake the demolition, removal, and backfill activities described in Section 9.d above at the tank site, and then SMI and District will cooperate on disposition of the tank site. 1 I) Conditions Precedent to Closine of Transaction. a) The PSC has entered a fdorder granting the PSC Approval. b) The Parties’ respective representaQonsand warranties specified in Section 11 arc heand correct as of the Closing Date. c) District has successfully arranged for financing of the Transaction. 12) Remesentations and Warranties. a) Sellers each represent and warrant to District as of the date of this Agreement and will represent and warant as of the Closing Date, in each case on its own behalf and in respect of the Transferred Assets in which has an ownership interest, that: i) Organization and kistence. It is duly organized and validly existing under West Virginia law, with full corporate power and authority to undertake its business as currently operated. ii) Corporate Authority. It has full corporate authority to execute, deliver and perform this Agreement and to consummate the Transaction, and the execution, delivery and performance of this Agreement and the Ancillary Agreements have been authorized by its board of directors. Upon mutual execution and delivery. each of the Agreement and the Ancillary Agreements will be a valid and binding obligation of the Seller executing it, enforceable in accordance with its terms. iii) Conflicting Instruments. Its execution, delivery and performance of this Agreement and the Ancillary Agreements and the consummation of the Transaction will not, with or without the giving of notice or the passage of time, (i) conflict with or result in the breach of, or constitute a default under, any agreement to which it is a party or any
6 4833-6915-8249.v1 instrument by which it is bound; (ii) violate any law, order, rule, regulation, writ, injunction or decree of any government, governmental instrumentality, agency or body, arbitration tribunal, or court, having jurisdiction over it or its property; or (iii) result in the creation of any lien, charge or encumbrance upon the Transferred Assets. iv) No Pending or Threatened Litigation, etc. No suit, action, investigation, inquiry or proceeding by any governmental body or other person or legal or administrative proceeding is pending or has been threatened that questions the validity or legality of the Transactions or seek to impose any liability on Seller as a result of the Transaction. v) Governmental Approvals. Except for the PSC Approval. no approval or authorization of filing or registration with, or notification to, any governmental or regulatory authority is required in connection with the execution and delivery of this Agreement or the Ancillary Agreements by Seller, or the performance of Seller’s obligations under those agreements, or the consummation of the Transaction. b) District represents and warrants to Sellers as of the date of this Agreement and will represent and warrant as of the Closing Date, that: i) Organization and Existence. It is duly organized and validly existing under West Virginia law. with full corporate power and authority to undertake its businesses as currently operated. ii) Corporate Authorily. It has full corporate authority to execute, deliver and perform this Agreement and the Ancillary Agreements and to consummate the Transaction, and the execution, delivery and performance of those agreements have been authorized by its board. Upon mutual execution and delivery, each of the Agreement and the Ancillary Agreements will be a valid and binding obligation of District, enforceable in accordance with its terms. iii) Conflicting Instruments. Its execution, delivery and performance of this Agreement and the Ancillary Agreements and the consummation of the Transaction will not, with or without the giving of notice or the passage of time. (i) conflict with or result in the breach of, or constitute a default under, any agreement to which it is a party or any instrument by which it is bound (ii) violate any law, order, rule, regulation, writ, injunction or decree of any government, governmental instrumentality, agency or
7 48334945-8249.v I body, arbitration tribunal, or court, having jurisdiction over it or its property, or (iii) to its knowledge, result in the creation of any lien, charge or encumbrance upon the Transferred Assets.
iv) No Pending or Threatened Litigation. No suit. action, investigation, inquiry OT proceeding by any governmental body or other person or legal or administrative proceeding is pending or has been threatened that questions the validity or legality of the Transaction or seeks to impose any liability on District as a result of the Transaction. v) Governmental Approvals. Except for the PSC Approval, no approval or authorization of filing or registration with, or notification to, any governmental or regulatory authority is required in connection with the execution and delivery of this Agreement or the Ancillary Agreements by District, or the performance of its obligations under those agreements, or the consummation of the Transaction. Force Maieure. If a Party’s performance of an obligation under this Agreement or the Ancillary Agreements is delayed or prevented for reasons beyond its control, such as an act of God, act of war, strike, lockout, restraint of labor, riot or civil commotion. order of court or administrative tribunal, then that Party will be excused from performance to the extent that it is necessarily delayed or prevented, and the time for performance will be extended during the continuance of the event. In any such case, that Party will notify the other Parties of the force majeure event and the expected time during which performance is to be delayed. Bindin9 Effect. This Agreement will be binding on and inure to the benefit of each Party’s successors and permitted assigns. For the avoidance of doubt, the acquisition of Intrawest Resorts Holdings, Inc. by a newly formed entity controlled by affiliates of the Aspen Skiing Company, L.L.C., and KSL Capital Partners, LLC, will not constitute an assignment of this Agreement. Amendment. This Agreement may be amended only through a written amendment signed by each Party. m.Any waiver of or delay in a Party’s enforcement against another Party of a right under this Agreement will not be deemed as a waiver of its entitlement to enforce that right in the future.
8 483349454249.~I 17) Counterparts. This Agreement may be executed in Counterparts, each of which shall be deemed to be an original 18) N-. All written notices given under this Agreement or any of the Ancillary Agreements are to be sent by registered or certified mail, return receipt requested. addressed as follows: If to SMI: Snowshoe Mountain, Inc. 10 Snowshoe Drive Snowshoe, West Virginia 26209-0010 Attn: General Manager
If to CMW: Cheat Mountain Water Company, Inc. c/o Snowshoe Mountain, Inc. 10 Snowshoe Drive Snowshoe, West Virginia 26209-0010 Attn: General Manager
If to District: Pocahontas County Public Service District 1020 Snowshoe Drive Slatyfork, WV 26291 Attn: General Manager
19) Inteeration. This Agreement represents the entire agreement among the Parties, and supersedes any previous oral or written agreements on the matters addressed, including the Letter of Intent and Term Sheet dated February 28,2017.
9 20) Governine Law. This Agreement is made under and is to be governed by and construed in accordance with West Virginia law.
For Pocahontas County Puhlic Service District:
For Cheat Mountain Water Company: Authorized Representative
For Snowshoe Mountain Inc.: Authorized Representatw
10 EXHIBIT A -- CMW Assets
All water treatment, transmission, distribution, storage, metering, and SCADNtelemetry facilities, including without limitation the water storage tank at the Inn at Snowshoe; all pumps. valves, hydrants, PRVs, and similar equipment; all permits and rights from governmental agencies associated with the Purchased Assets or the ownership, operation, or maintenance of the System; all vehicles, equipmenf tools, mnwntory. fiuniture. fixtures, computer and telephone facilities. computer hardware, and software: all inventory of chemicals and other substances needed to operate the treatment plant: all maps, surveys, engineering drawings. charts, and diagrams of the System. the treatment plant, and other Transferred Assets: all customer lists and customer account data; all books and records relating to the Utility Operations; all customer accounts receivable as of the Closing Date; all cash amounts representing (A) customer deposits subject to refund and (B) customer contributions subject to refund under routine extension agreements at the Closing Date; all contracts and contractual rights, including rights under the Ancillary Agreements; and all other water utility assets owned by CMW and useful in the Utility Operations of CMW as of the Closing Date.
Excluded Assets: a. One electric jack hammer b. Four bucks of scaffolding and attachments c. One small electric 1-bag concrete mixer
11 EXHIBIT B -- SMI Assets
1) The raw water collection and pumping facilities used to transport raw water to the water treatment plant, starting at the hot-tap on the existing SM 24-inch raw water lie and including the 12-inch water line to the raw water pump station, the raw water pump station itself, and the 12-inch raw water line fiom the raw water pump station to the existing treatment plant (“Raw Water Facilities”);
2) the Silver Creek wellhouse near the tubing hill, the inactive well with no pump at Silver Creek, the well and well house at the Inn at Snowshoe, and the wells and well houses at the Boathouse. Arbuckles, and the Sugar Shack (but not the compressor houses at Shavers and Silver Creek) (collectively, the “m);and 3) appropriate real property interests in the following: a. the site on which the water treatment plant is located, b. the site of the pump station located in the Silver Creek parking lot; c. the site of the raw water pump station near the raw water impoundment; d. easements for those components of the Raw Water Facilities other than the raw water pump station, including without limitation easements for the electric supply facilities.
1. to be installed for the District by the electric utility at the raw water pump station (to the extent not granted directly to the electric utility); and .. 11. to the storage tank at Silver Creek; 1. parcels of real property around, and of a size suitable for the operation of, each of the Wells (“Well Sites”); and to the extent rrquired in view of the coverage of other
easements to be conveyed, for each of the tanks, booster stations. and backwash facilities currently operated by CMW (“Facilities Sites”):
12 4833-6945-8249.v 1 2. all easements and rights-of-way, whether or not documented by deed or recorded, used and usefui in the Utility Operations as of the Closing Date, to he conveyed individually or, where needed, by blanket easement;
3. the perpetual easement from Fassifem Development to SMI for access to and the right to construct and operate a water tank at the Inn at Snowshoe; and
4) all maps, surveys, engineering drawings, charts, and diagrams of the Raw Water Facilities, the Well Sites, the Facilities Sites, and any other parts of the System.
13 Description In Svc Acquired NBV As of Projected at Date Value 6/30/2017 12/31/2017 CMW Assets WATER MAIN TO WELCOME CENTER 11/27/95 16.616.94 $ $ 750 GPM WATER TREATMENT PLANT 11/27/95 424.838.10 $ $ . WATER TREATMENT BUILDING 11/27/95 6.978.12 $ $ WATER TREATMENT PLANT 11128195 68.021.88 $ $ WATER STORAGE TANK 11/28/95 87,500.00 $ $ WATER LINE FROM TREATMENT PLANT TO 11/28/95 31,500.00 $ $ WATER PLANT &TANK REPAIRS 03/31/98 71,761.97 $ 37,285.95 $ 36,372.39 WATER LINE TO INN 11/01/98 48,493.75 $ 3,030.81 $ 1,818.45 SIDING-WTP UPGRADE 12/01/38 25,885.62 $ 1,725.72 $ 1,078.56 POTABLE WATER STORAGE TANK 01/15/00 280,359.09 $ 35,596.30 $ 28,138.72 WATER CONNECTIONS (1999 - 2000) 04/01/00 5,311.88 $ $ POTABLE WATER STORAGE TANK 05/0 110 1 115,522.25 $ 20,813.28 $ 17,740.38 WATER CONNECTIONS (7/2000-12/2000) 12/31 /00 5.282.96 $ $ WATER CONNECTIONS (1/2001-6/2001) 05/25/01 1,643.80 $ $ WATER LINE TO FIRESTATION 12/01/01 84.748.92 $ 31.639.54 $ 29,944.54 WATER PLANT BUILDING-VILLAGE BOOSTER 09/01/01 61.365.48 $ 36,947.08 $ 36,179.98 TOOLS AND EQUIPMENT 11 /I 2/01 8.1 82.77 $ -$ Water Line Extensions 12/01/03 13.009.34 $ 1,156.38 $ 722.76 VILLAGE WATER PRESSURE BOOSTER- NEXT 08/01/04 387,808.11 $ 135,732.78 $ 126,03756 WATER LINE EXTENSION TO NEW 06/30/06 14,620.21 $ 8,089.84 $ 7,797.46 RESORT ASSETS DISTR MAINS 06/30/06 13,781.03 $ 3,521.83 $ 3,062.47 ELECTRICAL PANEL THAT CONTROLS THE 07/01/07 23,155.45 $ 7,589.85 $ 6,818.01 EXTENDED WATER &SEWER MAINS TO 07/01/08 23,990.43 $ 13,094.79 $ 12,495.03 ENGINEERING FOR WATER TREATMENT PLANT 10/26/06 3,143.30 $ 1,442.23 $ 1,363.57 CHAIN LINK FENCE AROUND WATER TANKS 10/26/06 7,062.99 $ -$ WATER WELL-INN@SS 10/26/06 5,697.57 $ 959.13 $ 737.79 WATER LINE TO WAREHOUSE 10/26/06 3.91 1.49 $ 1,785.74 $ 1,688.36 WATER TREATMENT EQUIPMENT 10/26/06 9.289.45 $ -$ Extension for new site at Black Bear refund 03/01/09 43.756.96 $ 25,342.56 $ 24,248.64 Barcode Scanner 03/12/09 309.70 $ -$ Silver Creek Well House - remodel or #I well and 11/01/00 17,306.76 $ 5,617.44 $ 5,405.46 Well house #I was rebuilt and a new chlorine contact 01/29/02 30,788.97 $ 14,342.77 $ 13,845.31 SC Well #2 was redrilled and a new well house built - 01/01/02 26,771.75 $ 12,421.09 $ 11,990.29 WELLHOUSE 11/27/95 1,708.77 $ 302.53 $ 284.17 SILVER CREEK WATER LINE 07/01/06 23,281.94 $ 6,079.17 $ 5.303.13 Water Line Refund to Customer 07/01/09 4,417.74 $ 2,632.21 $ 2.521.75 Water Tank @ Inn 07/01/10 12,531.21 $ 8,093.08 $ 7,779.82 Backwash Fence 03/01/I 0 4,933.22 $ 1,521.09 $ 1,274.43 Meter Test Bench 0911 5/10 9,009.89 $ 2,778.04 $ 2,327.56 Water Filter Media 09/30/10 29.408.00 $ 9,312.53 $ 7,842.1 1 Water Filter Media 09/30/10 21,736.00 $ 6,883.07 $ 5,796.29 Planning / Consultants 07/01/10 26,963.69 $ 17,414.01 $ 16,739.91 lnstallationof Valves / Filters 07/31/10 108,747.17 $ 70,685.65 $ 67,966.99 Valves / Filters 07/01/10 68,341.85 $ 44.137.46 $ 42,428.90 Fire Pump /Start-up 11/01/10 7,000.00 $ 2,275.00 $ 1,925.02 Engine 11/01/10 25,700.00 $ 8,352.50 $ 7,067.48 Controller 11/01/10 9,600.00 $ 3,120.00 $ 2.640.00 Piping Material 11/01/10 3,500.00 $ 1,137.50 $ 962.48 Installation 11 /01 /I0 12,400.00 $ 4,030.00 $ 3,410.02 Double Wall Fuel Tank 11 /01 /I0 1.511.40 $ 491.20 $ 415.60 2 FPA Storage Cabinet 09/15/11 1,569.16 $ 640.72 $ 562.24
Client Work\4845- 1583.7773.~I -8/22/17 Description In Svc Acquired NBV As of Projected at Date Value 613012017 12/31/2017 Solarbee Machine 09/01/11 28.860.00 $ 11,784.50 $ 10,341.50 Inn Water Tank 09/01/11 24.125.00 $ -$ Inn Water Tank 09/01/11 266.11 $ -$ Extension Refund 11/01/11 2,410.53 $ 1,717.53 $ 1,657.29 Extension Refund 11/01 /I 1 4,002.62 $ 2,851.87 $ 2,751.79 Inn check valve 11/07/11 5,900.00 $ 2,507.50 $ 2,212.48 Booster Station located next to potable water tanks. 10/26/06 27,187.57 $ 14,960.15 $ 14,392.01 CLUBHOUSE-WATER SER. 10/26/06 3,954.33 $ -$ CHAPEL UTILITIES 10/26/06 20,266.59 $ -$ BURIED UTILITIES IN CONDUIT TO SUPPLY 10/26/06 25,681.98 $ 11,822.35 $ 11,177.47 VEHICLES - PICKUP TRUCKS (7) 10/26/06 17,120.94 $ -$ Drum hustler 01/01/13 684.72 $ 370.89 $ 336.63 Chemical containment drums 01/01/13 2,561.54 $ 1,387.51 $ 1,259.41 ALLEGRO MANHOLE BLOWER SYS AC 01/01/13 624.95 $ 338.49 $ 307.23 MIGHT EVAC SELFRETRACTING 01/01/13 3,269.95 $ 1,771.20 $ 1,607.70 Materials 01/01/13 2227.70 $ 1,206.67 $ 1,09531 Extension Refund 01/01/13 12,159.00 $ 9,372.56 $ 9,068.60 Extension Refund 11/01/12 1.441.00 $ 1,098.77 $ 1,062.77 Lockout Tagout Kits 11/01/12 1,097.91 $ 576.41 $ 521.51 Chlorine Detector Alarm 04/01/13 5,234.64 $ 2.966.31 $ 2,704.59 Eye Wash Station 04/01/13 1,144.46 $ 648.51 $ 591 27 Control panel 11/01 /I 3 41,500.00 $ 25,937.50 $ 23,862.52 Perimeter Fencing 07/01/I 4 23,260.65 $ 16,088.60 $ 14,925.56 Pressure Release Valve 07/01/I 4 33335.70 $ 28,225.94 $ 27,387.56 Electric Scales 07/01/14 4,379.70 $ 2,773.88 $ 2,554.88 Electric Scales 07/01/I 4 3345.00 $ 2,245.19 $ 2,067.95 Subsurface LD-15 Leak Detector 07/01/14 4,202.79 $ 2,871.95 $ 2,661.83 400 VFD 01/15/15 12.342.22 $ 9,153.82 $ 8,536.72 PumplMotor 01/15/15 38,999.64 $ 28,924.74 $ 26,974.74 CY16 SC Tank Painting 07/31/16 128,210.00 $ 102,568.00 $ 89,747.02 Water line extension 02/28/17 2,218.06 $ 2,171.85 $ 2,116.41 Meter installation 07/01/16 187,786.15 $ 158,053.34 $ 148,664.00 Meter installation 07/01/16 111,483.13 $ 93,831.63 $ 88,257.45 Tank level monitoring panel 07/01/16 18.201.18 $ 14,864.29 $ 13,954.21 High chemical feed pumps 07/01/I 6 29,538.00 $ 25,107.30 $ 23,630.40 $1,166,220.12 $ 1,081,162.44
SMI Assets 01/31/14 635,565.83 $ 579,953.80 $ 572,009.20 Water Separation 07/01/14 15,725.35 $ 10,745.66 $ 9,959.36 Water Separation 07/01/14 58,376.64 $ 37,944.85 $ 35,026.03 Water Separation 07/01/14 266,068.97 $ 172,944.90 $ 159,641.46 Water Separation 07/01/14 58,376.64 $ 37,944.85 $ 35,026.03 $ 839,534.06 $ 811,662.08
Total CMW and SMI Assets at 12/31/17 $ 1.892.824.52
Client Work\4845- 1583-7773.vI-8/22/17 Exhibit C -Form of JOINT USE AGREEMENT -4 JOlNT USE AGREEMENT datcd as of & 2017 by Snowshoe Mountain Inc. (“w)and Pocahontas County Public Service District (“District.” and together with SMI. the “Parries”).
Recitals
A. Cheat Mountain Water Company (“m)and District are public water utilities regulated by the Public Service Commission of West Virginia. CMW is a subsidiary of SMI, which owns and operates a resort in Snowshoe, West Virginia.
B. CMW: SMI; and District entered into an Asset Purchase Agreement dated rk +, +, __.2s. 2017 (‘‘W),under which CMW agreed to sell its water system to Dislrict and
SMI agreed to transfer to District certain SiMI-owned assets to be used in District‘s water utility operations, subject to PSC approval (“Sale”).
C. District plans to use an impoundment owned by SMI located at Shavers Point
(”Impoundment“) as its raw water supply in connection with its provision of water service. and
SMI plans to continue using the Impoundment as a water supply for its snowmaking operations.
D. SMI projects that CMW’s current demand levels for the provision of public water service - an annual average day demand of 0.5 million gallons per day (MGD) (“Average Day
Demand”) and a maximum day demand of 1.44 MGD (“Max Dav Demand“) - are likely to be sustainable during the Initial Temi in view of the Impoundment‘s physical characteristics, SMI’s current average and maximum daily demands, and expected growth in SMI’s average and maximum daily demands during the Initial Term.
J837-5546-5289.vI E. In consideration of the mutual promises in this Agreement and District’s continued ability to provide public water service to SMI, the Parties agree to the following terms:
1) Term. The term of this Agreement will commence on the closing date of the Sale and extend
for a period of twenty years clnitial Term”). At the end of the Initial Term, the Agreement
will automatically renew on an annual hasis unless terminated in accordance wth Section 5
below.
2) Use of Imwundment.
a. District may make withdrawals consistent with the Average Day Demand and the
Max Day Demand during the Initial Term, but SMI does not guarantee that Impoundment
capacity at levels supporting such withdrawals will be available under all circumstances or
in any particular circumstance.
b. District is not required to pay SMI for its use of the Impoundment or the water it
withdraws.
C. District’s mithdrawal rights are subject to (i) weather and its impact on
Impoundment levels, seasonally or over time; (ii) the Impoundment’s physical condition;
(iii) site-specific or watershed-specific conditions (including contamination of the
Impoundment or the watershed supplying it), no matter how those conditions may arise; and
(iv) fhue laws and regulations governing impoundments and regulatory or judicial action
under those laws and regulations.
d. Notwithstanding the maintenance responsibilities specified in Section 3, nothing
in this Agreement obligates SMI to undertake any work to the Impoundment to maintain or
improve its physical condition, or to obtain consent or approval from any regulatory
2 authority, for the purpose of maintaining or increasing the Impoundment’s average annual
withdrawal capacity or any other purpose.
3) Ownership and Maintenance. Each Party will own and maintain its own pumping facilities
and pay its own power costs. The Parties will allocate responsibility for maintaining the raw
water intake and related facilities (i) on a 50150 basis in 2017 and 2018, and (ii) in
subsequent years during and after the Initial Term, in the proportions that their respective
withdrawals during the most recent calendar year bore to the total withdrawals during that
year.
4) Cooueration. The Parties will cooperate with one another in the performance of this
Agreement and the use of the Impoundment in a manner that satisfies each Party’s needs to
the extent feasible, including as to the scheduling of withdrawals to minimize interference
with the other Party’s withdrawal needs.
5) Termination. This Agreement may be terminated at any time (i) by mutual written
agreement or (ii) by either Party, with or without cause, with not less than twelve months’
advance written notice by the terminating Party.
6) Succession: Assienment This Agreement will be binding on and inure to the benefit of each
Party’s successors and permitted assigns. For the avoidance of doubt, the acquisition of
Intrawest Resorts Holdings, Inc. by a newly formed entity controlled by afiliates of the
Aspen Skiing Company, L.L.C., and KSL Capital Partners, LLC, will not constitute an
assignment of this Agreement.
7) Countemarts. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original.
3 8) m. All written notices given under this Agreement are to be sent by registered or certified mail, return receipt requested, addressed as follows:
If to SMI Snowshoe Mountain, Inc. IO Snowshoe Drive Snowshoe, West Virginia 26209-0010 Attn: General Manager
If to District: Pocahontas County Public Service District 1020 Snowshoe Drive Slaty-fork,WV 26291 Attn: General Manager
9) w.Any waiver of or delay in a Party’s enforcement against another Party of a right
under this Agreement will not be deemed as a waiver of its entitlement to enforce that right
in the future
10) Inteaation. This Agreement represents the entire agreement among the Parties, and
supersedes any previous oral or wrjtten agreements on the matters addressed. including the
Letter of Intent and Term Sheet dated February 28,2017.
11) Conflict. To the extent of conflict between this Agreement and the MAon matters relating
to the Impoundment, the specific terms of this AgTeement will control.
4 12) Governing Law. This Agreement is made under and is to be governed by and construed in
accordance with West Virginia law
Snowshoe Mountain Inc.:
Its:-P ,.,,,A, -t
Pocahontas County Public Service District: By:
4x37-5546-52X9.v I 5 Exhibit D - Form of PROPERTY EXCHANGE AND DISPOSITION AGREEMENT
PROPERTY EXCHANGE AND DISPOSITION AGREEMENT dated as of a%)l7 by Snowshoe Mountain Inc. (“w)and Pocahontas County Public Service District (”m,”and together with SMI, the “-’).
Recitals
A. Cheat Mountain Water Company (“m)and District are public water utilities
regulated by the Public Service Commission of West Virginia. CMW is a subsidiary of SMI.
which owns and operates a resort in Snowshoe, West Virginia.
8. CMW; SMI; and District havc entered into an Asset Purchase Agreement dated
May 2017 rm),whereby CMW agreed to sell its water utility operations and assets
(“-1 to District, and SMI ageed to transfer to District certain SM1-omed assets to be
used in District’s water utility operations. As part of that transaction. SMI has conveyed to
District certain parcels of real property on which the current water treatment plant and backwash
facility (together, “Current WTP“) are currently located, generally identified as the 76 foot by
145 foot parcel (subject to survey) shown in Exhibit A-1 and the parcel and associated easement
to the west of Snowshoe Drive (subject to survey) shown in Exhibit A-2 (together, the ‘’GEC!~ Sites”).
C. The Parties anticipate that within ten years, District will decommission the
Current WTP and construct a new WTP (“New WTP“) on another parcel of property now owned
by SMI, generally identified as the parcel (subject to survey) shown in Exhibit B (“Future Site”).
D. The Parties seek to agree in advance to the terms and conditions of the
conveyances of the Current Sites and Future Site. E. In consideration of the mutual promises in this Agreement and other god and
valuable consideration, the Parties agree to these terms:
1) Other Definitions. The Current Sites and Future Site are sometimes individually
referred to as the “Prooertv” or together as the “Properties.” A Party intending to
convey title to a Property is referred to as the ‘‘Wand a party intending to accept
title to a Property is referred to as the “Grantee.”
2) Propertv Convevances.
a. Fuiure Site. Upon not less than 90 days’ written notice from District, SMI will
convey the Future Site to District on an “as is” basis on or about the date
specified in the notice, using a special warranty deed that incorporates standard
terms and conditions for the conveyance of real property and a legal
description of the parcel set forth in Exhibit B, subject to SMI’s reservation of
a parking and access easement, the terms of which SMI will determine in its
sole discretion.
b. Current Sites. Within 30 days of the date District has completed the last to
occur of placement of the New WTP into service. removal of the Current WTP
from service, and completion of the activities described in MA Section 9.4
District will convey the Current Sites to SMI, using a special warranty deed
that incorporates standard terms and conditions for the conveyance of real
property and legal descriptions of the parcels set forth in Exhibits A-1 and A-2.
c. Surveys and Properg Descriprions. Prior to the closing of the transaction
described in the MA, the Parties will cooperate in District’s identification.
2 4822-2893-5241 .VI survey, and preparation of definitive legal descriptions for the Current Sites,
the Future Site and the easement to be reserved from the Future Site.
3) Value of Prowrties; Consideration. Notwithstanding the amounts of time expected to
elapse before the first conveyance and between the two conveyances, the Parties agree
that on the date this Agreement is executed and as of the dates of each conveyance
(each a “Closing Date”), (i) the fair market values of the Properties are and will be
reasonably equivalent and (ii) each Property is and will be deemed to be a fair and
reasonable consideration for the conveyance of the other Property. Other than nominal
consideration provided for in the deeds, (i) in the conveyance of the Future Site, no
consideration will be required of District apart from its promise to convey the Current
Sites, and (ii) in the conveyance of the Current Sites, no consideration will be required
of SMI apart &om its conveyance of the Future Site.
4) u.The Parties anticipate that District will be exempt from ad valorem and similar taxes against each Property during the period District owns it. SMI will be
responsible for all such taxes (i) up to and including the Closing Date for the Future
Site and (ii) after the Closing Date for the Current Sites.
5) Condition of Title. The Properties will be conveyed by special warranty deed free
and clear of liens and encumbrances other than the reservation described in paragmph
2(a) above and any easements, covenants. and restrictions of record.
6) -t. Time IS agreed to be of the essence for each conveyance. If either Party fails
to comply with any of this Agreement’s material terms and has not complied within 30
days of its receipt of written notice from the other Party, then the other Party may
3 declare a default and seek any remedy at law or in equity without notice or demand.
including specific performance.
7) Risk of Loss. For each conveyance, risk of loss or damage to each Property will rest
with Grantor until and though the Closing Date.
8) Costs and ExDenses. For each conveyance, (i) Grantor will pay the cost of preparing
the deed, (ii) Grantee will be responsible for the costs of any further surveying that
may be needed and the cost of the commitment and any title policy for the Property,
and (iii) each Party will be responsible for payment of any other costs and expenses it
may incur, including fees of attorneys and accountants. The Parties anticipate that
each conveyance will be exempt from any excise or transfer taxes.
9) Further Assurances. Each Party will without further consideration execute and deliver
such other documents and take such other action, whether prior or subsequent to each
Closing Date, as may be reasonably requested by the other Party to consummate more
effectively the purposes of this Agreement. The Parties agree to use their best efforts
in cooperation to carry out the intent of this Agreement.
10) Possession. On each Closing Date, Grantor will deliver to Grantee full possession of
the Property.
11) Binding Effect. This Agreement will be binding on and inure to the benefit of each
Party's successors and permitted assigns. For the avoidance of doubt, the
acquisition of Intrawest Resorts Holdings, Inc. by a newly formed entity
controlled by affiliates of the Aspen Skiing Company, L.L.C., and KSL Capital
Partners, LLC, will not constitute an assignment of this Agreement.
4 4822-2893-5241 .v 1 12) Amendment. This Agreement may be amended only through a written amendment
signed by each Party
13) m.Any waiver of or delay in a Party’s enforcement against the other Party of a
right under this Agreement will not be deemed as a waiver of its entitlement to enforce
that right in the future.
14) Countemarts. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original
15) m.All wsitten notices given under this Agreement are to be sent by registered or
certified mail, return receipt requested, addressed as follows:
If to SMI Snowshoe Mountain, Inc. 10 Snowshoe Drive Snowshoe, West Virginia 26209-001 0 Attn: General Manager
If to District: Pocahontas County Public Service District 1020 Snowshoe Drive Slatyfork, WV 26291 Attn: General Manager
16) Integration. This Agreement represents the entire agreement between the Parties, and
supersedes any previous oral or written agreements on the matters addressed,
including the Letter of Intent and Term Sheet dated February 28,201 7.
1 7) Conflict. To the extent of conflict between this Agreement and the APA on matters
relating to the conveyances, the specific terms of this Agreement will control.
5 4822-2893-524 1.Y I 18) Governing Law. This Agreement is made under and is to he governed by and
construed in accordance with West Virginia law
Snowshoe Mountain Inc.:
Pocahontas County Public Service District:
By:
STATE OF WEST VIRGINIA
COUNTY O~&.fi~,+,624
a Notary Public . unty and State . 2017, . an authorized Y appe acknowledged the foregoing instrument on behalf of the company.
STATE OF WEST VIRGINIA
COUNTY OF
the County and State
I an authorized eared before me and
My Commission expires:
[SEA
6 4822-2893-5241 .VI EXHIBIT A-1
Reference Map for Current Water Treatment Plant
4822-2893-5241 .VI Error
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An error occurred while processing this page. See the system log for more details. Error
An error occurred while processing this page. See the system log for more details. EXHIBIT B
Reference Map for Future Site Error
An error occurred while processing this page. See the system log for more details. Exhibit E - Form of ACCESS AGREEMENT rl, ACCESS AGREEMENT dated as of 2017 by Snowshoe
Mountain Inc. ("W)and Pocahontas County Public Service District ("District," and together with SMI. the "w).
Recitals
A. Cheat Mountain Water Company ("W")and District are public water utilities regulated by the Public Service Commission of West Virginia. CMW is a subsidiary of SM1. which owns and operates a resort in Snowshoe, West Virginia.
B. CMW. SMI. and District entercd into an Asset Purchase Agreement dated May 62017 (UT).under which CMW agreed to sell its water treatment and distribution system ("w')to District and SMI agreed to transfer to District certain SMI-owed assets to be used in District's water utility operations, subject to PSC approval (%a&").
C. SMI and District anticipate that after the Sale. certain access. road maintenance. snow removal, and well operation and maintenance efforts will require their cooperation.
District will rely on SMI assistance and cooperation to operate. maintain. repair. and replace the portions of the System. and SMI will rely on District's ability to continue to provide water service to its customers. including SMI.
D. In consideration of the mutual promises in this Agreement and District's continued ability to provide public water service to SMI, the Parties agree to the followin,0 terms:
1 j b.The term of this Agreement will commence on the closing date of the Sale and extend
for a period of twenty years ("Initial Term"). At the end of the lnitial Term, the Agreement
4848-1 288-8649.vl will automatically renew on an annual basis unless terminated in accordance with Section 7
helow.
2) Vehicular Access Assistance
a. During periods when heavy snow accumulation makes it difficult for District
representatives to access the Arbuckle well and well house. the Boathouse well and well
house, the Sugar Shack well and well house, the mid-station PRV at Hawthorne. the
Hawthorne potable storage tank, or the Silver Creek water storage tank, SMI will provide
reasonable vehicular access assistance to District personnel and contractors (by snowmobile,
snowcat, bulldozer, grooming machine, or other appropriate vehicle that SMI may select) to
facilitate District maintenance activities at those facilities (“Vehicular Access Assistance”).
b. SMI will provide Vehicular Access Assistance upon reasonable advance notice
from District. The availability and timing of Vehicular Access Assistance after advance
notice will depend upon and take into account the exigency of District’s maintenance need,
the impact of failing to address that need on District’s water utility operations, weather and
safety conditions, and the availability of appropriate SMI vehicles and personnel. SMI does
not guarantee that Vehicular Access Assistance to any particular District facility, or within
any length of time after reasonable notice, will he available under all circumstances or in
any particular circumstance. If SMI is unable are unwilling to provide Vehicular Access
Assistance in an emergency situation, then after coordinating with SMI, District may
attempt to access the facility through its own means and at its own risk. and upon doing so
will be responsible for the repair or replacement of any damage to the areas traversed and
the land features and facilities in those areas. all to SMI’s satisfaction.
4848- l288-8M9.vl 2 3) Road Maintenance. District will have primary responsibility for road maintenance and
snow removal for roads that District uses to provide access by its personnel and contractors
to the Hawthorne water storage tank and PRV at that site. the mid-station PRV at
Hawthome. the Inn at Snowshoe water storage tank, and any other roads that SMI will have
no need to access on a regular basis. SMI will be permitted to have reasonable joint access
to these roads when necessary to SMI's operations ("Access Ritzhts").
4) Well Omration and Maintenance. SMI will maintain the existing electric service
connections to the Boathouse well and well house and the Sugar Shack well and well house
to permit District to operate those wells and related facilities and thus provide water service
to the SMI facilities those wells are intended to serve ("Continued Service," and together
with the Vehicular Access Assistance and Access Rights. the "&&.e$'). At such time that
the electric utility has facilities close enough to these locations that District can take service
directly from the electric utility facilities and Continued Service is no longer needed,
District will apply for and take service from the electric utility.
5) Consideration. Neither Party will be required to pay a fee to the other for the provision of
Services. However, should either Party determine that its provision of one or more Services
has created or is likely to create an operational burden for that Party or cause that Party to
incur a level of expense not reasonably anticipated when this Agreement was executed, the
Parties may negotiate a means of periodic compensation for those Services.
6) Indemnificabon.
a. Indemn~ficarionof District. To the fullest extent permitted by applicable
law and, in District's case. the limits of its applicable insurance coverage, SMI will defend and indemnify District (including its board members, cmployees. and agents, the "m
4848-1288-8649.v I 3 Indemnified Parties”) for, and hold the District lndemnified Parties harmless from, any
claims by third parties for property damage or personal injury, together with any related
suits, liens, judgments, damages. losses and expenses, including attorney’s fees (collectively, a “Loss“), arising from or related to the negligent acts or omissions of SMI or
its employees, agents, contractors, or subcontractors in the course of providing or receiving
the Services. regardless of whether the Loss is caused in part by a District Indemnified
Party. However, SM1 will not be required to defend, indemnify, or hold harmless a District
Indemnified Party from a Loss caused by the District Indemnified Party’s sole negligence or
willful misconduct.
b. Indernnifiralion ofSM1. To the fullest extent permitted by applicable law
and the limits of District‘s applicable insurance coverage. District will defend and
indemnify SMI (including its officers, directors. employees, and agents. the “SMI
Indemnified Parties”) for, and hold the SMI Indemnified Parties harmless from, any claims
by third parties for property damage or personal injury, together with any related suits, liens, judgments, damages, losses and expenses, including attorney’s fees (collectively, a “I&$).
arising from or related to the negligent acts or omissions of Districts or its employees.
agents, contractors, or subcontractors in the course of providing or receiving the Services,
regardless of whether the Loss is caused in part by an SMI Indemnified Party. However,
District will not be required to defend, indemnifl, or hold harmless an SMI Indemnified
Party from a Loss caused by the SMI lndemnified Party’s sole negligence or willful
misconduct.
7) Termination. This Agreement may be terminated at any time (i) by mutual written
agreement of the Parties or (ii) by either Party upon the other Party‘s breach of this
4848-1288-8649.v I 4 Agreement that has not been cured within 30 days of receiving written notice of the breach.
This Agreement will terminate contemporaneously with the termination of the APA. without
further action by either Party.
8) Succession: Assirnment. This Agreement will be binding on and inure to the benefit of each
Party's successors and permitted assigns. For the avoidance of doubt, the acquisition of
lntrawest Resorts Holdings, lnc. by a newly formed entity controlled by affiliates of the
Aspen Skiing Company, L.L.C.. and KSL Capital Partners. LLC. will not constitute an
assignment of this Agreement.
9) Countemarts. This Agreement may be executed in counterparts. each of which shall be
deemed to be an original.
IO) Waiver. Any waiver of or delay in a Party's enforcement against another Party of a right
under this Agreement will not be deemed as a waiver of its entitlement to enforce that right
in the future.
11) Amendment. This Agreement may be amended only through a written amendment signed
by each Party.
12) Interntion. This Agreement represents the entire agreement among the Parties. and
supersedes any previous oral or written agreements on the matters addressed, including the
Letter of Intent and Term Sheet dated February 28.201 7.
13) Conflict. To the extent of conflict between this Agreement and the MA on matters
addressed in this Agreement, the specific terms of this Agreement will control. TO the
extent of conflict between the access provisions of this Agreement and any deed or
easement relating to ownership of or access to a facility identified in this Agreement, the
specific terms of that deed or easement will control.
4848- 1288-8649.v 1 5 14) Notices. All written notices given under this Agreement are to be sent by registered or
certified mail, return receipt requested, addressed as follows:
If to SMI: Snowshoe Mountain, Inc. 10 Snowshoe Drive Snowshoe, West Virginia 26209-0010 Atln: General Manager
If to District: Pocahontas County Public Service District 1020 Snowshoe Drive Slatyfork. WV 26291 Attn: General Manager
15) Governing Law. This Agreement is made under and is to be govcrned by and construed in
accordance with West Virginia law.
Snowshoe Mountain Inc.:
By.
11s: L\&A. -
Pocahontas County Public Service District:
By: Its: c>:,c-,,,
4848-1 288-XM9.b I 6 Error
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An error occurred while processing this page. See the system log for more details. Draft Bond Resolution POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT
BOND RESOLUTION
RESOLUTION AUTHORIZING THE DESIGN, ACQUISITION, CONSTRUCTION AND EQUIPPING OF ADDITIONS, BETTERMENTS, IMPROVEMENTS AND EXTENSIONS TO THE EXISTING PUBLIC WATERWORKS SYS POCAHONTAS COUNTY PUBLIC SERVICE DISTRIC INANCING OF THE COST, NOT OTHERWISE PROV OF THROUGH
AGGREGATE PRINCIPAL
FUND); PROVID SECURITY FOR AUTHORIZING DOCUMENTS
SALE AND PROVID SUCH BONDS AND
COUNTY PUBLIC S
INGS AND DEFINITIONS
. This Resolution (together with any order or resolution s 13A and Chapter 31, Article 15A of the West Virginia Code of ct”), and other applicable provisions of law.
. It is hereby found, determined and declared that:
A. Pocahontas County Public Service District (the “Issuer”) is a public service district and a public corporation and political subdivision of the State of West Virginia in Pocahontas County of said State.
B. The Issuer presently owns and operates a public waterworks system. However, it is deemed necessary and desirable for the health, safety, advantage, convenience and welfare of the inhabitants of the Issuer that there be designed, acquired, constructed and/or equipped certain additions, betterments, improvements and extensions to the existing public waterworks system of the Issuer,
1 consisting of acquisition of the potable water system assets, including real and personal property, of Cheat Mountain Water, Inc. (collectively, the “Cheat Mountain System”), and designing, acquiring, constructing and equipping certain additions, betterments, improvements and extensions to the Cheat Mountain Water System, together with all necessary appurtenances (collectively, the “Project”) (the existing public waterworks facilities of the Issuer, the Project and any further additions, betterments or extensions thereto are herein called the “System”).
C. The Issuer intends to permanently finance the costs of design, acquisition,
Water Development Authority (the “Authority”), which admini est Virginia Infrastructure Fund pursuant to the Act.
D. It is deemed necessary for ater Revenue Bonds, Series 2017 A (West Virginia Infrastructure Fund), in ‘pal amount not to exceed $2,365,700 (the “Series 2017 A Bonds”), to construction and equipping of the Project. Said cost of all property rights, easements and franchises deemed nece
expenses; expenses for estimates of other expenses necessary or incident practicability of the enterprise, rity, discount, initial fees for the in connection with the sale of or incidental to the financing herein authorized, t the performance oft n with any thereof; m,that
System after design, acquisition, construction and
arties (the “Loan Agreement”), approved hereby if not previously approved by resolution
G. There are outstanding obligations of the Issuer which will rank on a parity with the Series 2017 A Bonds as to liens, pledge and source of and security for payment, which obligations are the Issuer’s:
(i) Water Revenue Bonds, Series 1997 A (United States Department of Agriculture), dated April 21, 1997, issued in the original aggregate principal amount of $316,000 (the “Series 1997 A Bonds”);
2 (ii) Water Revenue Bonds, Series 1997 B (United States Department of Agriculture), dated April 21, 1997, issued in the original aggregate principal amount of $150,000 (the "Series 1997 B Bonds"); and
(iii) Water Revenue Bonds, Series 201 1 A (West Virginia Infrastructure Fund), dated February 24,201 1, issued in the original aggregate principal amount of $296,250 (the "Series 201 1 A Bonds") (collectively, the "Prior Bonds"). liens, pledge and source of and security for payment and in all r Prior to the issuance of the Series 2017 A Bonds, the Issuer will obtain (i) a certificate t Certified Public Accountant stating that the coverage and parity tests of the Prior B (ii) the written consent of the
Other than the Prior Bonds, there are no outstandin e Issuer which are secured by revenues or assets of the System. The Issuer i enants of the Prior Bonds and the Prior Resolutions (as hereinafter defined)
H. The estimated revenues o nd maintenance of the System and the principal of an and to make payments into all funds
West Virginia law and the Loan , equipping and operation of the Project and the ill have so complied prior to issuance of any the and the financing t
r, the time for rehearing and appeal of which 2017 A Bonds or such final order will not be
er 3 1, Article 15A of the West Virginia Code of 193 1, as
In consideration of the red Owners of the same from
Issuer and such Registered the Issuer shall be for the equal benefit, protection and security of the Registered Owners of any and all of such Series 2017 A Bonds, all which shall be of equal rank and without preference, priority or distinction between any one Bond of a series and any other Bonds of the same series, by reason of priority of issuance or otherwise, except as expressly provided therein and herein.
Section 1.04. Definitions. The following terms shall have the following meanings herein unless the context expressly requires otherwise:
3 “Act” means, collectively, Chapter 16, Article 13A, and Chapter 31, Article 15A of the West Virginia Code of 1931, as amended and in effect on the date of adoption hereof.
“Authority” means the West Virginia Water Development Authority, which is expected to be the original purchaser and Registered Owner of the Series 2017 A Bonds, or any other agency, board or department of the State of West Virginia that succeeds to the functions of the Authority, acting in its administrative capacity and upon authorization from the Council under the Act.
“Authorized Officer” means the Chairman of the Governing Body of the Issuer or any temporaty Chairman duly selected by the Governing Body.
“Bondholder,” “Holder of the Bonds,” “
such Bond is registered.
as such in the Supplemental Resolution and its su
“Bonds” means, collect e Prior Bonds and any bonds on other resolution of the Issuer.
anniversary of the Closing Date in each year and losing Date in the following year, except that the
veming Body of the Issuer.
ch there is an exchange of the Series 2017 17 A Bonds from the Authority.
nue Code of 1986, as amended, and the Regulations.
the West Virginia Municipal Bond Commission or any other at succeeds to the functions of the Commission.
s” means E.L. Robinson Engineering, Charleston, West Virginia or any qualified engineer o gineers, licensed by the State, that shall at any time hereafter be procured by the Issuer as Consulting Engineers for the System or portion thereof in accordance with Chapter 5G, Article 1 of the West Virginia Code of 1931, as amended; provided however, that the Consulting Engineers shall not be a regular, full-time employee of the State or any of its agencies, commissions, or political subdivisions.
“Costs” or “Costs of the Project” means those costs described in Section 1.02G hereof to be a part of the Costs of the Project.
4 “Council” means the West Virginia Infrastructure and Jobs Development Council or any other agency of the State of West Virginia that succeeds to the functions of the Council.
“Depository Bank” means the hank designated as such in the Supplemental Resolution, and its successors and assigns, which shall he a member of FDIC.
“FDIC” means the Federal Deposit Insurance Corporation and any successor to the functions of the FDIC.
“Fiscal Year” means each 12-month period h g on July 1 and ending on the succeeding June 30. now or hereafter he constituted.
“Government Obligations” the timely payment of the principal of and interest on which is g
“Grants” means all m
‘‘Gross Revenues” m erally accepted accounting e provision for uncollectible the sale or other disposition of, or from any incr Investments, as hereinafter defined, purchased p
I refer to this entire Bond Legislation.
reafter he retained by the Issuer to prepare an
ivision of the State of West Virginia in Pocahontas County, West Virginia and, clearly indicates otherwise, includes the Governing Body of the
by and between the Issuer and the Authority, on behalf of the Council, providing for the purchase of the Series 2017 A Bonds from the Issuer by the Authority, the form of which shall he approved, and the execution and delivery by the Issuer authorized and directed or ratified, by the Supplemental Resolution.
“Net Proceeds” means the face amount of the Series 2017 A Bonds, plus accrued interest and premium, if any, less original issue discount, if any, and less proceeds, if any, deposited in the Series 2017 A Reserve Account.
5 “Net Revenues” means the balance of the Gross Revenues, remaining after deduction of Operating Expenses, as hereinafter defined.
“Operating Expenses” means the reasonable, proper and necessary costs of repair, maintenance and operation of the System and includes, without limiting the generality of the foregoing, administrative, engineering, legal, auditing and insurance expenses, other than those capitalized as part of the costs fees and expenses of the Authority, fiscal agents, the Depository Bank, the Registrar and the Paying Agent (all as herein defined), other than those capitalized as part of the costs, payments to pension or retirement funds, taxes and such other reasonable operating co xpenses as should normally and regularly be included under generally accepted accountin les; provided, that “Operating
are applicable to prior accounting periods.
“Outstanding,” when used wit describes all Bonds theretofore and thereupon cancelled by the Bond Registrar at or prior to sal equal to its principal amount and re or redemption shall be in trust he
e provisions and within the limitations prescribe
ies 1997 A Bonds, Series 1997 B Bonds and
including but not limi Virginia “consolidated fund managed by the West Virginia Board of Treasury Investments pursuant to Chapter 12, Article 6C of the Code of West Virginia.
“Registrar” means the Bond Registrar.
“Regulations” means temporary and permanent regulations promulgated under the Code or any predecessor to the Code.
6 “Renewal and Replacement Fund” means the Renewal and Replacement Fund continued by Section 5.01 hereof.
“Reserve Accounts” means, collectively, the respective reserve accounts established for the Series 2017 A Bonds and the Prior Bonds.
“Reserve Requirement” means, collectively, the respective amounts required to be on deposit in the Reserve Accounts of the Series 2017 A Bonds and the Prior Bonds.
“Revenue Fund” means the Revenue Fund con Section 5.01 hereof.
“RUS Bonds” means, collectively, the Ser‘ onds and Series 1997 B Bonds
“Secretary” means the Secretary of th
“Series 1997 A Bonds” means th s, Series 1997 A (United States Department of Agriculture), dated April 2 1 issued in the original ate principal amount of $3 16,000.
“Series 1997 B Bonds States Department of Agriculture), dat he original aggregate principal amount of $150,000.
Bonds, Series 201 1 A (West Virginia Infrastructur a1 aggregate principal amount
evenue Bonds, Series 2017 A (West Virginia
t Fund” means the Series 2017 A Bonds Cons%t Trust Fund
e Account” means the Series 2017 A Bonds Reserve
i 1s Reserve Requiretqent” means, as of any date of calculation, the erest, if any, which will become due on the Series 2017 A Bonds in the then current or any suc
“Series 2017 A Bonds Sinking Fund” means the Series 2017 A Bonds Sinking Fund established by Section 5.02 hereof.
“Sinking Funds” means, collectively, the respective Sinking Funds established for the Series 20 I7 A Bonds and the Prior Bonds.
“State” means the State of West Virginia, “Supplemental Resolution” means any resolution or order of the Issuer supplementing or amending this Resolution and, when preceded by the article “the,” refers specifically to the supplemental resolution or resolutions authorizing the sale of the Series 2017 A Bonds; w,that any matter intended by this Resolution to be included in the Supplemental Resolution with respect to the Series 2017 A Bonds, and not so included, may be included in another Supplemental Resolution.
“Surplus Revenues” means the Net Revenues not required by the Bond Legislation to be set aside and held for the payment of or security for the Bonds, the Prior Bonds or any other obligations the Reserve Accounts.
additions, betterments and improvements thereto ndior equipped for the waterworks system from any sources whatsoever. to connect thereto.
“West Virginia lnfras t Virginia Infrastructure Fund West Virginia Code of 1931, as
e and vice versa; words importing importing the masculine, feminine or neutral
ACQUISITION, CONSTRUCTION\ OF THE PROJECT
Governing Body. The proceeds of the Series2017 ABonds hereby authorized shall be applied as provided in Article VI hereof. The Issuer has received bids and will enter into contracts for the design, acquisition, construction and equipping of the Project, in an amount and otherwise compatible with the financing plan submitted to the Authority and the Council.
The Cost of the Project is estimated not to exceed $2,365,700, which will be obtained from the proceeds of the Series 2017 A Bonds.
8 ARTICLE 111
AUTHORIZATION, TERMS, EXECUTION, REGISTRATION AND SALE OF BONDS; AUTHORIZATION AND EXECUTION OF LOAN AGREEMENT
Section 3.01. Authorization of Bonds. For the purposes of capitalizing interest, if any, on the Series 2017 A Bonds, funding the Series 2017 A Bonds Reserve Account, paying Costs of the Project not otherwise provided for and paying certain costs of issuance of the Series 2017 A Bonds and related costs, or any or all of such purposes, as determined by the mental Resolution, there shall be and hereby are authorized to be issued negotiable Series2017 of the Issuer. The Series 2017 A Bonds shall be issued as a single bond, desig evenue Bonds, Series 2017 A (West Virginia Infrastructure Fund),” in the principal 00, and shall have such terms as remaining after funding of the Series 2017 A Bonds d from Bond proceeds) and or credited to the Series plied as set forth in Article VI hereof.
issued in such principal amounts; shall bear int specifically provided in the Loan Agre 1 be payable as to principal at legal tender for the p United States of America. Interest on the Series he Paying Agent mailed to the Registered Owne e Bond Registrar, or by such other method as shall Authority is the Registered Owner thereof.
ental Resolution, the Series 2017 A Bonds to the Authority, with a record of advances
g and being exchanged, with principal installments or to the dates of payment of principal installments of said Bonds; obligated to pay any expenses of such exchange. denominations as determ’ Supplemental Resolution. Such Bonds shall have such terms as set forth in a Supplemental Resolution.
9 Section 3.03. Execution of Bonds. The Series 2017 A Bonds shall he executed in the name of the Issuer by the Chairman, and the seal of the Issuer shall he affixed thereto or imprinted thereon and attested by the Secretary. In case any one OJ more of the officers who shall have signed or sealed the Series 2017 A Bonds shall cease to be such officer of the Issuer before the Series 2017 A Bonds so signed and sealed have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. Any Series 2017 A Bonds may he signed and sealed on behalf of the Issuer by such person as at the actual time of the execution of such Bonds shall hold the proper office in the Issuer, although at the date of such Bonds such person may no held such office or may not have been so authorized
Section 3.04. ond Registrar for the Series 2017 successors and assigns. No Series 2017 A Bond sh ny purpose or entitled to any security or benefit under this Bond Legislati e of Authentication and Registration on such Bond, substantially in the manually executed by the Bond Registrar. thentication and Registration upon any such Bond shall be conc u on any Series 2017 A Bond shall be signed by an authorized officer of the sign the Certificate of Authentication a
Subject to the provisions for d have all of the qualities and incidents of ne de of the State of West Virginia, and each successive be conclusively deemed to have and incidents of negotiable instruments under a, and each successive Holder shall further he be incontestable in the hands of a bona fide
oks for the registration and transfer of the Bonds.
duly executed by the R J or his duly authorized attorney.
In all cases in which the privilege of exchanging Series 2017 A Bonds or transferring the registered Series 2017 A Bonds are exercised, all Series 2017 A Bonds shall be delivered in accordance with the provisions of this Bond Legislation. All Series 2017 A Bonds surrendered in any such exchanges or transfers shall forthwith be canceled by the Bond Registrar. For every such exchange OJ transfer of Series 2017 A Bonds, the Bond Registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer and the cost of preparing each new Bond upon each exchange or transfer, and any other expenses of the Bond Registrar incurred in connection therewith, which sum or sums shall be paid by the Issuer. The Bond
IO Registrar shall not be obliged to make any such exchange or transfer of Bonds during the period commencing on the 15th day of the month next preceding an interest payment date on the Series 2017 A Bonds or, in the case of any proposed redemption of Series 2017 A Bonds, next preceding the date of the selection of Bonds to be redeemed, and ending on such interest payment date or redemption date.
Section3.06. Bonds Mutilated, Destroyed, Stolen or Lost. In case any Series 2017 A Bond shall become mutilated or be destroyed, stolen or lost, the Issuer may, in its discretion, issue, and the Bond Registrar shall, if so advised by the Issuer, authenticate and deliver, a new Bond of the same series and of like tenor as the Bonds so mutilated, destroyed, sto ost, in exchange and substitution for such mutilated Bond, upon surrender and cancellation utilated Bond, or in lieu of and substitution for the Bond destroyed, stolen or lost, an indemnity and complying with such other reasonable surrendered shall be cancelled by the Bond Registr he Issuer. If any such Bond shall have matured or be about to mature, i the same, upon being indemnified as aforesaid, or destroyed, without surrender thereof.
Section 3.07. 2017 A Bonds shall not, in any event, be or
he Issuer, if any, to pay
by irrevocably pledged to such payments as
. The Issuer shall execute and deliver the Series 2017
2017 A Bonds to
he Authority, a list of the names in which the Series 2017 egistered upon original issuance, together with such taxpayer other information as the Bond Registrar may reasonably require;
B. A request and authorization to the Bond Registrar on behalf of the Issuer, signed by an Authorized Officer, to authenticate and deliver the Series 2017 A Bonds to the original purchasers;
C. An executed and certified copy of the Bond Legislation; D. An executed copy of the Loan Agreement; and
E. The unqualified approving opinion of bond counsel on the Series 2017 A Bonds.
Section3.10. Form of Bonds. The text of the Series 2017 ABonds shall be in substantially the following form, with such omissions, insertions and variations as may be necessary and desirable and authorized or permitted hereby, or by any Supplemental Resolution adopted prior to the issuance thereof:
12 (FORM OF SERIES 2017 A BOND)
UNITED STATES OF AMERICA STATE OF WEST VIRGINIA POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT WATER REVENUE BONDS, SERIES 2011 A (WEST VIRGINIA INFRASTRUCTURE FUND)
No. AR-1
KNOW ALL MEN BY THESE P POCAHONTAS COUNTY PUBLIC SERVICE DI and political subdivision of the State of West V’ for value received, hereby promises to pay, solel d therefor, as hereinaffer registered assigns the sum of amount as shall have been advan set forth in the installments on March 1, June 1, 1, 20- to and inc Schedule” attached as EXHIBIT B her -% per annum payable quarter1
d herein by reference. respective dates of
owner hereof at the address as it appears on
ed owner hereof.
of the Authority on behalf of the West Virginia Infrastructure on cil (the “Council”), and upon the terms and conditions prescribed
This Bond is issued (i) to pay the costs of acquiring the potable water system assets, including real and personal property, of Cheat Mountain Water, Inc. (collectively, the “Cheat Mountain System”), and designing, acquiring, constructing and equipping certain additions, betterments, improvements and extensions to the Cheat Mountain Water System (collectively, the “Project”), and (ii) to pay certain costs of issuance and related costs. The existing public waterworks system of the Issuer, the Project and any further additions, betterments, improvements or extensions thereto are herein called the “System.” This Bond is issued under the authority of and in full compliance with the Constitution and statutes of the State of West Virginia, including particularly Chapter 16, Article 13A and Chapter31,
13 Article 15A of the West Virginia Code of 1931, as amended (collectively, the “Act”), and a Bond Resolution duly adopted by the Issuer on , 2017, and a Supplemental Resolution duly adopted by the Issuer on , 2017 (collectively, the “Bond Legislation”), and is subject to all the terms and conditions thereof. The Bond Legislation provides for the issuance of additional bonds under certain conditions, and such bonds would he entitled to be paid and secured equally and ratably from and by the funds and revenues and other security provided for the Bonds under the Bond Legislation.
THIS BOND IS ISSUED ON A PARITY WITH ECT TO LIENS, PLEDGE AND SOURCE OF AND SECURITY FOR PAYMENT, AND I HER RESPECTS, WITH THE ISSUER’S:
(I) WATER REVENUE B (UNITED STATES DEPARTMENT OF AGRICULTURE), DATED IN THE ORIGINAL
(11) WATER REVENUE SERIES 199 ITED STATES HE ORIGINAL
INFRASTRUCTURE FUND), SUED IN THE ORIGINAL AGGREGATE PRINCIPAL ERIES 2011 A BONDS”)
the Net Revenues (as defined m, on a parity with the pledge of ies in the reserve account created
shall be set aside as a special fund hereby
hlish and maintain just and equitable rates and charges for the use hereby, which shall be sufficient, together with other revenues of and to leave a balance ea from such revenues on a parity with the Bonds, including the Prior Bonds; provided however, that so long as there exists in the Series 2017 A Bonds Reserve Account an amount at least equal to the maximum amount of principal and interest, if any, which will become due on the Bonds in the then current or any succeeding year, and in the respective reserve accounts established for any other obligations Outstanding on a parity with the Bonds, including the Prior Bonds, an amount at least equal to the requirement therefor, such percentage may be reduced to 110%. The Issuer has entered into certain further covenants with the Registered Owners of the Bonds for the terms of which reference is made to the Bond
14 Legislation. Remedies provided the Registered Owners of the Bonds are exclusively as provided in the Bond Legislation, to which reference is here made for a detailed description thereof,
Subject to the registration requirements set forth herein, this Bond is transferable, as provided in the Bond Legislation, only upon the hooks of United Bank, Inc., Charleston, West Virginia, as registrar (the “Registrar”), by the Registered Owner, or by its attorney duly authorized in writing, upon the surrender of this Bond, together with a written instrument of transfer satisfactory to the Registrar, duly executed by the Registered Owner or its attorney duly authorized in writing.
this Bond, under the provision of the Act is, and has all the qualities and incidents of, a instrument under the Uniform Commercial Code of the State of West Virginia.
All money received from the sale o amounts advanced for preliminary expenses as pr solely to payment of the Costs of the Project Legislation, and there shall be and hereby is creat in favor of the Registered Owner of this Bond.
IT IS HEREBY CER things required to exist, happen and b er as required by law, and that the
hat a sufficient amount of the Net Revenues of the aid special fund by the Issuer
solutions and statutes under which this Bond is d hy this Bond to the same extent as if written
age Intentionally Blank]
15 IN WITNESS WHEREOF, POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT has caused this Bond to be signed by its Chairman and its corporate seal to be hereunto affixed and attested by its Secretary, and has caused this Bond to be dated the day and year first written above.
[SEAL]
Chairman
ATTEST:
Secretary
16 CERTIFICATE OF AUTHENTICATION AND REGISTRATlON
This Bond is one of the Series 2017 A Bonds described in the within-mentioned Bond Legislation and has been duly registered in the name of the Registered Owner set forth above, as of the date set forth below.
Date: ,2017
17 EXHIBIT A
RECORD OF ADVANCES
AMOUNT DATE AMOUNT DATE
(1) $ (19) (2) (3) (4) (5) (6) (7) - (8) (9)
~~ ( 10) (1 1)
18 EXHIBIT B
DEBT SERVICE SCHEDULE
19 (Form 00
ASSIGNMENT
FOR VALUE RECEIVED the undersigne sells, assigns, ar transfers unto
20 Section3.11. Sale of Bonds; Amroval and Ratification of Execution of Loan Agreement. The Series 2017 A Bonds shall he sold to the Authority, pursuant to the terms and conditions of the Loan Agreement. If not so authorized by previous resolution, the Chairman is specifically authorized and directed to execute the Loan Agreement and the Secretary is directed to affix the seal of the Issuer, attest the same and deliver the Loan Agreement to the Authority, and any such prior execution and delivery is hereby authorized, approved, ratified and confirmed.
Section 3.12. Filing of “Amended Schedule”. Upon completion of the Project, the Issuer will file with the Authority and the Council a schedule, t of which will he provided by the Council, setting forth the actual Costs of the Project and sources
FUNDS AND ACCOUNTS;
accounts of the Depos
Resolution for the Series 1997
iation Fund and hereby renamed and
Bonds Construction Trust Fund. special funds or accounts a Resolutions) and shall he held by the Commission separate and apart from all other funds or accounts of the Commission and the Issuer and from each other:
(1) Series 2011 A Bonds Sinking Fund (established by Prior Resolutions and continued hereby);
(2) Series 2011 A Bonds Reserve Account (established by Prior Resolutions and continued hereby);
21 (3) Series 2017 A Bonds Sinking Fund; and
(4) Series 2017 A Bonds Reserve Account.
Section 5.03. System Revenues: Flow of Funds. A. The entire Gross Revenues derived from the operation of the System shall be deposited upon receipt in the Revenue Fund. The Revenue Fund shall constitute a trust fund for the purposes provided in this Bond Legislation and shall be kept separate and distinct from all other funds of the Issuer and th sitory Bank and used only for the on deposit in the Re :venue Fund
current Operating Expenses of the Syst
to (i) the National Finance Office t RUS Bonds; and (ii) of interest of the Seri
al Finance Office the amounts
esolutions to pay the principal of the Series
ent of principal of the Series 2017 A Bonds, for
Series 2017 A Bonds Sinking Fund and the next quarterly principal payment date is less than 3 months, then such monthly payments shall be increased proportionately to provide, 1 month prior to the next quarterly principal payment date, the required amount of principal coming due on such date.
(4) The Issuer shall next, on the first day of each month, transfer from the Revenue Fund and (i) remit to the Depository Bank the amounts required by Prior Resolution for deposit in the RUS Bonds Reserve Account; (ii) remit
22 to the Commission the amount required by the Prior Resolution for deposit in the Series 201 1 A Bonds Reserve Account; and (iii) remit to the Commission, commencing 4 months prior to the first date of payment of principal on the Series 2017 A Bonds, if not fully funded upon issuance of the Series 2017 A Bonds, for deposit in the Series 2017 A Bonds Reserve Account, an amount equal to lil20th of the Series 2017 A Bonds Reserve Requirement, until the amount in the Series 2017 A Bonds Reserve Account equals the Series 2017 A Bonds Reserve Requirement; provided that, no further payments shall be made into the Series 2017 A Bonds Reserve Account w ere shall have been deposited therein, and as long as there shall re deposit therein, an amount equal to the Series 2017 A Bonds Rese
the Revenue Fund and remit to Renewal and Replacement Fun Resolutions and not in addition
the Renewal and Re the Issuer or of the
made from the ents, emergency
aximum extent
Fund shall be used only for the purposes of 7 A Bonds as the same shall become due.
dare insufficient therefor, and for no other purpose.
on monies in the Series 2017 A Bonds Sinking Fund and the Series 2017 A Bonds Re in full, first to the next e rest payment, if any, due on the Series 2017 A Bonds, and then to the next ensuing principal payment due thereon.
Any withdrawals from the Series 2017 A Bonds Reserve Account which result in a reduction in the balance therein to below the Reserve Requirement shall be subsequently restored from the first Net Revenues available after all required payments have been made in full in the order set forth above.
23 As and when additional Bonds ranking on a parity with the Series 2017 A Bonds are issued, provision shall be made for additional payments into the respective sinking funds sufficient to pay the interest on such additional parity Bonds and accomplish retirement thereof at maturity and to accumulate a balance in the respective reserve accounts in an amount equal to the requirement thereof.
The Issuer shall not be required to make any further payments into the Series 2017 A Bonds Sinking Fund and the Series 2017 A Bonds Reserve Account when the aggregate amount of funds therein are at least equal to the aggregate principal amount of the Series 2017 A Bonds issued pursuant to this
Principal, interest or reserve payments, wheth deficiency or otherwise, shall be made on a parity and pro rata, with respect to the Series 201 with the respective principal amounts then Outstandin
The Commission is hereby designat 2017 A Bonds Sinking Fund and the Series 2017 said accounts shall be remitted to the Commiss provided herein. The Issuer shall make the necessa ments into said accounts shall be automatically deb' nsferred to the Commission on the dates required her
Monies in the Series 201 the Series 2017 A Bonds Reserve Account shall be invested and reinveste e with Section 8.01 hereof.
Bonds Reserve Account shall servicing the Series 2017 A Bonds under the conditions
of the required and provided transfers and payments from the Revenue Fund into funds, as hereinbefore provided, are current and there remains in of the estimated amounts required to be so transferred and paid into onth or such other period as required by law, such excess shall be us Revenues may be used for any lawful purpose of the System.
D. The Issuer shall remit to the Commission, the Registrar, the Paying Agent or the Depository Bank, on such dates as the respective parties shall require, such additional sums as shall be necessary to pay their respective charges and fees then due. In the case of payments to the Commission under this paragraph, the Issuer shall, if required by the Authority at anytime, make the necessary arrangements whereby such required payments shall be automatically debited from the Revenue Fund and electronically transferred to the Commission on the dates required.
24 E. The monies in excess of the maximum amounts insured by FDIC in all funds and accounts shall at all times be secured, to the full extent thereof in excess of such insured sum, by Qualified Investments as shall be eligible as security for deposits of state and municipal funds under the laws of the State.
F. If on any monthly payment date the revenues are insufficient to place the required amount in any of the funds and accounts as hereinabove provided, the deficiency shall be made up in the subsequent payments in addition to the payments which would otherwise be required to be made , however, that the priority of pursuant to this Section 5.03, and the Net Revenues shall be o such deficiencies before being applied to any other payments hereunder.
G. The Gross Revenues of the d for purposes of the System.
BOND PROCEE
deducted and deposited in the order set
re shall first be deposited with the Commission in Supplemental Resolu
ries 2017 A Bonds, there shall be deposited
the Series 2017 shall be deposited with the Depository Bank in the Series 2017 A Bonds Constructi ed solely to payment of Costs of the Project in the manner set forth in Section 6 d, are hereby pledged as additional security for the Series 2017
D. After completion of the Project, as certified by the Consulting Engineers, and all Costs have been paid, any remaining proceeds of the Series 2017 A Bonds shall be applied as directed by the Council.
The Issuer shall each month provide the Council with a requisition for the costs incurred for the Project, together with such documentation as the Council shall require. Payments of all Costs of the Project shall be made monthly.
25 Section 6.02. Disbursements from the Bond Construction Trust Fund. The Issuer shall each month provide the Council with a requisition for the costs incurred for the Project, together with such documentation as the Council shall require. Payments of all Costs of the Project shall be made monthly.
Except as provided in Section 6.01 hereof, disbursements from the Series 2017 A Bonds Construction Trust Fund shall be made only after submission to and approval from the Council, of a certificate, signed by an Authorized Officer stating that:
(a) None of the items for which the pa proposed to be made has been requested from another source;
e made is or was necessary in connection with the Project and constitutes a C
(C) Each of such Costs has b
Pending such application rust Fund shall be invested and reinvested in Qualifie
All the covenants, agreements and and legally binding covenants of the
. The Series 2017 A Bonds derived from the o A Bonds shall ever have the right to compel the exercise of the taxing power of the Issuer, if any, to pay the Series 2017 A Bonds or the interest, if any, thereon.
Section 7.03. Bonds Secured by Pledge of Net Revenues; Lien Positions with ResDect to Prior Bonds. The payment of the debt service of the Series 2017 A Bonds shall be secured by a first lien on the Net Revenues derived from the System on a parity with the lien on such Net Revenues in favor of the Holders of the Prior Bonds. Such Net Revenues in an amount sufficient to pay the principal of and interest, if any, on and other payments for the Series 2017 A Bonds and the Prior Bonds and to make all
26 other payments provided for in the Bond Legislation, are hereby irrevocably pledged to such payments as they become due.
Section 7.04. Initial Schedule of Rates and Charges. The Issuer has obtained any and all approvals of rates and charges required by State law and has taken any other action required to establish and impose such rates and charges, with all requisite appeal periods having expired without successful appeal and shall provide an opinion of counsel to the Issuer of such effect. Such rates and charges shall be sufficient to comply with the requirements of the Loan Agreement and the Issuer shall provide a certificate of a certified public accountant of such e e initial schedule of rates and charges for the services and facilities of the System shall nd approved and described in the Recommended Decision of the Public Service Commissi ___which became Final Order on -PWD-CN and such rates are hereby adopted. and collect rates, fees and other charges fort ctions necessary to provide funds sufficient to produce the requi with the Loan Agreement. In the event the schedul System in connection with the Series sums set forth in this Bond Legislati that it will, to the extent or in the schedule of rates, fees and charges a ary to provide funds sufficient to
2017 A Bonds and the Prior Bonds are Out Authority and the t be sold, mortgaged, leased or
ommission for deposit in the Series 2017 A
t of the Series 2017 A Bonds and interest, if any, mission unless necessary for the payment of other
notwithstanding, the Issuer shall have and hereby reserves the right determined in the manne rein to be no longer necessary, useful or profitable in the operation thereof. Prior to any suc or other disposition of such property, if the amount to be received therefor is not in excess of $50,000, the Issuer shall, by resolution duly adopted, determine that such property comprising a part of the System is no longer necessary, useful or profitable in the operation thereof and may then provide for the sale of such property. The proceeds of any such sale shall be deposited in the Renewal and Replacement Fund. If the amount to be received from such sale, lease or other disposition of said property shall be in excess of $50,000 but not in excess of $200,000, the Issuer shall first, determine that such property comprising a part of the System is no longer necessary, useful or profitable in the operation thereof and may then, by resolution duly adopted, authorize such sale, lease or other disposition of such property in accordance with the laws of the State. The proceeds of any such sale
27 shall be deposited in the Renewal and Replacement Fund. The payment of such proceeds into the Renewal and Replacement Fund shall not reduce the amount required to he paid into said fund by other provisions of this Bond Legislation. No sale, lease or other disposition of the properties of the System shall be made by the Issuer if the proceeds to he derived therefrom shall be in excess of $200,000 and insufficient to pay all Bonds then Outstanding without the prior approval and consent in writing of the Holders of the Bonds then Outstanding. The Issuer shall prepare the form of such approval and consent for execution by the then Holders of the Bonds for the disposition of the proceeds of the sale, lease or other disposition of such properties of the System.
Series 2017 A Bonds. All obligations issued by the of the Series 2017 A Bonds and payable from the revenues of the System, express statement that such obligations are junio and source of and security for payment from such revenues and in that no such subordinate obligations shall he issue and accounts set forth herein have suance of such subordinate obligations.
and revenues of the ds and the interest thereon, if any, in this Bond Le
Council prior written notice of its issuance of from the revenues of the System or from any
the conditions and requirements herein provided.
All Parit hereunder shall be on a parity in all respects with the Series 2017 A Bonds.
No such Parity Bonds shall be issued except for the purpose of financing the costs of the acquisition or construction of additions, extensions, improvements or betterments to the System or refunding any Outstanding Bonds, or both such purposes.
So long as the RUS Bonds are outstanding, no Parity Bonds shall he issued at any time, however, unless there has been procured and filed with the Secretary a written statement by the Independent Certified Public Accountants, reciting the conclusion that the Net Revenues for the Fiscal
28 Year following the year in which such Parity Bonds are to he issued shall be at least 120% of the average annual debt service requirements on the following:
(1) The Bonds then Outstanding;
(2) Any Parity Bonds theretofore issued pursuant to the provisions contained in this Resolution then Outstanding; and
(3) The Parity Bonds then proposed to he issued
The foregoing limitation may be waived or e written consent of the Holders of the RUS Bonds, representing 75% of the then-outsta foregoing limitation is waived or when the RUS Bon standing, the following parity requirement shall be met:
So long as the Series 2011 A Bo Bonds shall he issued at any time, unless there the Net Revenues
ssuance of such Parity Bonds, plus the estimated aver of the 3 succeeding years after the co e financed by such Parity Bonds, if any, shall not be less than 115% o will mature and become due in
ed pursuant to the provisions contained in this
annual Net Revenues expected to he received in each of the computation provided in the above paragraph, shall ted to he derived from the improvements to be financed in rates adopted by the Issuer and approved by the Public Service e for appeal of which shall have expired prior to the issuance of ed the amount to be stated in a certificate of the Independent Certified Public Accou shall he filed in the office of the Secretary prior to the issuance of such Parity Bonds.
The Net Revenues actually derived from the System during the 12-consecutive-month period herein above referred to may be adjusted by adding to such Net Revenues such additional Net Revenues which would have been received, in the opinion of the Independent Certified Public Accountants, on account of increased rates, rentals, fees and charges for the System adopted by the Issuer, the time for appeal of which shall have expired prior to issuance of such Parity Bonds.
29 All covenants and other provisions of this Bond Legislation (except as to details of such Parity Bonds inconsistent herewith) shall he for the equal benefit, protection and security of the Holders of the Bonds and the Holders of any Parity Bonds subsequently issued from time to time within the limitations of and in compliance with this section. All Bonds, regardless of the time or times of their issuance, shall rank equally with respect to their lien on the revenues of the System and their source of and security for payment from said revenues, without preference of any Bond over any other. The Issuer shall comply fully with all the increased payments into the various funds and accounts created in this Bond Legislation required for and on account of such Parity Bonds, in addition to the payments required for Bonds theretofore issued pursuant to this Bond Legislation.
Parity Bonds shall not he deemed to incl certificates or other obligations subsequently issued, the lien of which on the revenues subject to the prior and superior payable from revenues of the System, or any part o or, except in the manner and under the conditions provided in this sectio ource of and security for payment from such revenues, with the Series 201
No Parity Bonds shall he issued at a he Bonds then Outstanding, and any other payments en made in full
onstructing and installing the gents and representatives, to the System at all reasonable
and maintenance of the System at all reasonable times
oks and records of the System, which shall be separate and apart from all other books, r ounts of the Issuer, in which complete and correct entries shall be System, and any Holder of a Bond or Bonds issued pursuant to this Bond Legislation shall have the right at all reasonable times to inspect the System and all parts thereof and all records, accounts and data of the Issuer relating thereto.
The accounting system for the System shall follow current generally accepted accounting principles and safeguards to the extent allowed and as prescribed by the Public Service Commission of West Virginia. Separate control accounting records shall be maintained by the Issuer. Subsidiary records as may be required shall be kept in the manner and on the forms, books and other bookkeeping records as prescribed by the Governing Body. The Governing Body shall prescribe and institute the manner by
30 which subsidiary records of the accounting system which may he installed remote from the direct supervision of the Governing Body shall be reported to such agent of the Issuer as the Governing Body shall direct.
The Issuer shall file with the Council, the Authority, or any other original purchaser of the Series 2017 A Bonds, and shall mail in each year to any Holder or Holders of the Series 2017 A Bonds, requesting the same, an annual report containing the following:
Revenues derived from and relating to the System.
A balance sheet statement showin its in all the funds and accounts
The Issuer shall also, at least on nd accounts of the System to be audited by Independent Certified compliance with 2CFR 200 Subpart available generally, the report of the any Holder or Holders of the Series Authority, or any other original purc Authority and the Council shall inc are adequate to meet t eserve requirements.
gineers. All real estate and interests in real and the Project site heretofore or hereafter
all also provide the Authority and the Council, or their agents and representatives, w em site and System facilities as may be reasonably necessary to accomplish all oft ts of the Authority and the Council with respect to the System pursuant to the Act.
Section 7.09. m. Prior to the issuance of the Series 2017 A Bonds, equitable rates or charges for the use of and service rendered by the System shall he established all in the manner and form required by law, and copies of such rates and charges so established will he continuously on file with the Secretary, which copies will be open to inspection by all interested parties. The schedule of rates and charges shall at all times he adequate to produce Gross Revenues from the System sufficient to pay Operating Expenses and to make the prescribed payments into the funds created hereunder. Such schedule of rates and charges shall be changed and readjusted whenever necessary so that the aggregate of the rates and charges will he sufficient for such purposes. In order to assure full and continuous
31 performance of this covenant, with a margin for contingencies and temporary unanticipated reduction in income and revenues, the Issuer hereby covenants and agrees that the schedule of rates or charges from time to time in effect shall be sufficient, together with other revenues of the System (if to provide for all Operating Expenses of the System and (ii) to leave a balance each year equal to at least 115% of the maximum amount required in any year for payment of principal of and interest, if any, on the Series 2017 A Bonds and all other obligations secured by a lien on or payable from such revenues on a parity with the Series 2017 A Bonds, including the Prior Bonds; e,that in the event that amounts equal to or in excess of the reserve requirements are on deposit in the Series 2017 A Bonds Reserve Account and the reserve accounts for obligations on a parity with the Seri , including the Prior Bonds, are funded at least at the requirement therefor, such balance ea only equal at least 110% of the maximum amount required in any year for payment of princ terest, if any, on the Series 2017 A Bonds and all other obligations secured by a lien on or ch revenues on a parity with the Series 2017 A Bonds, including the Prior Bonds. In an uer shall not reduce the rates or charges for services described in Section 7.04.
. The Issuer shall
detailed, balanced budget of the estimated revenue d maintenance of
Commencing on the date quisition and construction of the r shall each month complete a “Monthly Financial ement, and forward a copy of such report to the A
The Issuer will obtain a ent, stating, among other
epared by the Consulting Engineers, which have been approved by all necessary governme approved plans, specifications and designs, or amendments thereto, approved by all necessary governmental bodies.
The Issuer shall employ qualified operating personnel properly certified by the State during the entire term of the Loan Agreement.
The Issuer will serve the additional customers at the location(s) as set forth in Certificate of Engineer. The Issuer will not reduce the amount of additional customers served by the project without
32 the prior written approval of the Board of the West Virginia Water Development Authority (the “Authority”). Following completion of the Project the Issuer will certify to the Authority the number of customers added to the System.
Section 7.12. No Comoeting Franchise. To the extent legally allowable, the Issuer will not grant or cause, consent to or allow the granting of, any franchise or permit to any person, firm, corporation, body, agency or instrumentality whatsoever for the providing of any services which would compete with services provided by the System.
Section 7.13. shall become delinquent to the full extent permitted o , the rules and regulations of
and facilities of the of the services and facilities shall To the extent authorized by the Public Service 1 become a lien and agrees that, it will, to the full the Public Service Commission of
will not restore such services until all delinquent terest and penalty charges for r actions to enforce collections to the maximum exteii
the System, nor will any preferential rates be
same rates, fees or charges applicable to other
employee. The revenues so received shall be deemed to
suer will, as an Operating Expense, procure, carry and maintain insurance with a reputable insurance carrier or carriers as is customarily covered with respect to works and properties similar to the System. Such insurance shall initially cover the following risks and be in the following amounts:
(1) FIRE, LIGHTNING, VANDALISM, MALICIOUS MISCHIEF AND EXTENDED COVERAGE INSURANCE, on all above-ground insurable portions of the System in an amount equal to the actual cost thereof. In time of war the Issuer will also carry and maintain insurance to the extent available against the risks
33 and hazards of war. The proceeds of all such insurance policies shall be placed in the Renewal and Replacement Fund and used only for the repairs and restoration of the damaged or destroyed properties or for the other purposes provided herein for the Renewal and Replacement Fund. The Issuer will itself, or will require each contractor and subcontractor to, obtain and maintain builder’s risk insurance (fire and extended coverage) to protect the interests of the Issuer, the Authority, the prime contractor and all subcontractors as their respective interests may appear, in accordance with the Loan Agreement, during construction of the Project on a 100% basis (completed value form) on the insurable portio Project, such insurance to be made payable to the order of the Authori uer, the contractors and subcontractors, as their interests may appear.
(2) PUBLIC LIABILITY IN s of not less than $1,000,000 per occurrence to protect t bodily injuly and/or death and not less than $500,000 of others which may arise from t same limits to protect the Issuer of motor vehicles of or for the System
EMPLOYEES OF OR PERFORMANCE AND s to be in the amounts of h contractor contracting with the Clerk of The be performed prior to lance with West Virginia
ilities of the System are or will be slide-prone areas and to the extent
TION INSURANCE, to the extent available at
will be provided as to every officer, member and overning Body having custody of the revenues or of
son at any one time.
B. The Issuer shall require all contractors, if any, engaged in the construction of the Project to furnish a performance bond and a payment bond, each in an amount equal to 100% of the contract price of the portion of the Project covered by the particular contract as security for the faithful performance of such contract. The Issuer shall verify such bonds prior to commencement of construction.
The Issuer shall also require all contractors, if any, engaged in the construction of the Project to carry such workers’ compensation coverage for all employees working on the Project and public liability insurance, vehicular liability insurance and property damage insurance in amounts
34 adequate for such purposes and as is customarily carried with respect to works and properties similar to the Project; w,that the amounts and terms of such coverage are satisfactory to the Authority and the Council and the Issuer shall verify such insurance prior to commencement of construction. In the event the Loan Agreement so requires, such insurance shall be made payable to the order of the Authority, the Issuer, the prime contractor and all subcontractors, as their interests may appear.
Section 7.16. Connections. To the extent permitted by the laws of the State and rules and regulations of the Public Service Commission of West Virginia, the Issuer shall require every owner,
Section 7.17. will complete the Project as
The Issuer has obtained all permits for the acquisition and construction of the Pro'e issuance of the Bonds required by S successful appeal and shall provide an
rotection of the Holders of the Series 2017 A and created by the Act, which statutory mortgage and binding, shall take effect shall be on a parity with the Prior Bonds.
. The Issuer shall perform, d the Act. Notwithstanding copies of all documents
with all applicable laws, rules and regulations issued by state, federal or local bodies in regard to the acquisition and ration, maintenance and use of the System.
rm an annual maintenance audit which maintenance audit shall be submitted to the Authority Public Service Commission of West Virginia in accordance with the guidelines established by the Authority and the Public Service Commission of West Virginia.
Section 7.21. Securities Laws Compliance. The Issuer will provide the Authority, in a timely manner, with any and all information that may be requested of it (including its annual audit report, financial statements, related information and notices of changes in usage and customer base) so that the Authority may comply with the provisions of SEC Rule 15~2-12 (1 7 CFR Part 240).
35 Section 7.22. Contracts: Change Orders. Public Releases. A. The lssuer shall, simultaneously with the delivery of the Series 2017 A Bonds or immediately thereafter, enter into written contracts for the immediate acquisition or construction of the Project.
B. The Issuer shall submit all proposed change orders to the Council for written approval. The Issuer shall obtain the written approval of the Council before expending any proceeds of the Series 2017 A Bonds held in “contingency” as set forth in the respective schedules attached to the certificate of the Consulting Engineer. The Issuer shall also obtain the written approval of the Council before expending any proceeds of the Series 2017 A Bonds made available due to bid or construction or project underruns.
Project, including but not limited to any program d onjunction with any ground breaking or dedication of the Project.
art of the funds and accounts created by this Bond L invested and reinvested by the or account, as the Qualified lnvestments to the eed for such monies for the
times deemed a part of the fund or account in cruing thereon and any profit or loss realized
investments whe permitted by this section
The Depository Bank shall keep complete and accurate records of all funds, accounts and investments, and shall distribute to the Issuer, at least once each year, or more often as reasonably requested by the Issuer, a summary of such funds, accounts and investment earnings. The Issuer shall retain all such records and any additional records with respect to such funds, accounts and investment earnings so long as any of the Series 2017 A Bonds are Outstanding and as long thereafter as necessary to assure the exclusion of interest, if any, on the Series 2017 A Bonds from gross income for federal income tax purposes.
36 Section 8.02. Certificate as to Use of Proceeds: Covenants as to Use of Proceeds. The Issuer shall deliver a certificate as to use of proceeds or other similar certificate to be prepared by nationally recognized bond counsel relating to restrictions on the use of proceeds of the Series 2017 A Bonds as a condition to issuance of the Series 2017 A Bonds. In addition, the Issuer covenants (i)to comply with the Code and all Regulations from time to time in effect and applicable to the Series 2017 A Bonds as may be necessary in order to maintain the status of the Series 2017 A Bonds as public purpose bonds; (ii) that it shall not take, or permit or suffer to be taken, any action with respect to the Issuer’s use of the proceeds of the Series 2017 A Bonds which would cau bonds, the interest on which is exempt from federal income taxation under Section 103(a of , issued by the Authority or the Council, from which the proceeds of the Series 2017 A ived, to lose their status as tax- exempt bonds; and (iii) to take such action, or refrain ch action, as shall be deemed covenants and agreements set forth in this Section, r actions may be contraly to any of the provisions of this Resolution.
The Issuer shall annually furnish use of the proceeds of the Series 2017 A Bon Authority.
lowing events shall constitute an “Event of Defau
nctual payment of the principal
Legislation, any supplemental resolution or
the Issuer shall have been given written notice of
uer files a petition seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of the United States of America; or
(4) If default occurs under the Prior Bonds or the Prior Resolutions
Section9.02. Remedies. Upon the happening and continuance of any Event of Default, any Registered Owner of a Bond may exercise any available remedy and bring any appropriate action, suit or proceeding to enforce his or her rights and, in particular, (i) bring suit for any unpaid
31 principal or interest then due, (ii) by mandamus or other appropriate proceeding enforce all rights of such Registered Owners including the right to require the Issuer to perform its duties under the Act and the Bond Legislation relating thereto, including but not limited to the making and collection of sufficient rates or charges for services rendered by the System, (iii) bring suit upon the Bonds, (iv) by action at law or bill in equity require the Issuer to account as if it were the trustee of an express trust for the Registered Owners of the Bonds, and (v) by action or bill in equity enjoin any acts in violation of the Bond Legislation with respect to the Bonds, or the rights of such Registered Owners; M,that all rights and remedies of the Holders of the Series 2017 A Bonds shall be on a parity with the Holders of the Prior Bonds. proper legal action, compel the making and collection of sufficient rates and charge System and segregation of the revenues therefrom and the application th Default with respect to such Bonds, any Registered Owner of a Bond s right by appropriate legal proceedings to obtain to complete the Project on behalf of the Issuer, WI
his or her or its agents and attorneys, enter into and maintain, mana ereof, and in the name of the Issuer exercise all facilities as the Issuer itself
d interest thereon and under any covenants of nd upon any other obligations and interest ues of the System shall have been paid and Legislation shall have been cured and made
egistered Owner of any Bonds shall have the same right
may be appointed in the n of such court. Nothing herein contained shall limit or restrict the jurisdiction of such court to enter such other and further orders and decrees as such court may deem necessary or appropriate for the exercise by the receiver of any function not specifically set forth herein.
Any receiver appointed as provided herein shall hold and operate the System in the name of the Issuer and for the joint protection and benefit of the Issuer and Registered Owners of the Bonds. Such receiver shall have no power to sell, assign, mortgage or otherwise dispose of any assets of any kind or character belonging or pertaining to the System, but the authority of such receiver shall be limited to the completion of the Project and the possession, operation and maintenance of the System for the sole
38 purpose of the protection of both the Issuer and Registered Owners of such Bonds and the curing and making good of any Event of Default with respect thereto under the provisions of this Bond Legislation, and the title to and ownership of the System shall remain in the Issuer, and no court shall have any jurisdiction to enter any order or decree permitting or requiring such receiver to sell, assign, mortgage or otherwise dispose of any assets of the System.
ARTICLE X
PAYMENT OF BON
Section 10.01. Pavment of Bonds. If th all pay or there shall otherwise be thereon, at the times and in the manner stipulated t lation, then the pledge of Net Revenues and other monies and securities lation and all covenants, agreements and other obligations of the Issuer to A Bonds shall thereupon cease, terminate and become void and necessary to assure the exclusion of interest, if an federal income tax purposes.
. Prior to issuance of
datory or supplemental hereto, that would
e Series 2017 A Bonds so affected and then
I amount of Bonds, required for consent to the above-permitted amendments or m hstanding the foregoing, this Bond Legislation may be amended as may be necessary to assure compliance with Section 148(f) of the Code relating to OJ otherwise as may be necessary to assure the exclusion of interest, if any, on the Series s from gross income of the Holders thereof.
Section 11.02. Bond Legislation Constitutes Contract. The provisions of the Bond Legislation shall constitute a contract between the Issuer and the Registered Owners of the Series 2017 A Bonds, and no change, variation or alteration of any kind of the provisions of the Bond Legislation shall be made in any manner, except as in this Bond Legislation provided.
Section 11.03. Severabilitv of Invalid Provisions. If any section, paragraph, clause OJ provision of this Resolution should be held invalid by any court of competent jurisdiction, the invalidity
39 of such section, paragraph, clause or provision shall not affect any of the remaining provisions of this Resolution, the Supplemental Resolution or the Series 2017 A Bonds.
Section 11.04. Headings, &. The headings and catchlines of the articles, sections and subsections hereof are for convenience of reference only, and shall not affect in any way the meaning or interpretation of any provision hereof.
Section 11.05. Conflicting Provisions Repealed. All orders or resolutions, or parts thereof, in conflict with the provisions of this Resolution are, extent of such conflict, hereby repealed, provided, that in the event of any conflict between th ion and the Prior Resolutions, the Prior Resolutions shall control (unless less restrictive), so lo r Bonds are Outstanding.
Section 11.06. conditions, things and procedure or to be taken precedent to ed and have been taken
40 Section 11.07. Effective Date. This Resolution shall take effect immediately upon adoption.
Adopted this __ day of ,2017.
POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT
41 CERTIFICATION
Certified a true copy of a Resolution duly adopted by the Public Service Board of
POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT on the ~ day of ,2017.
Dated: ,2017.
[SEAL]
710090 00008
42 POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT WATER REVENUE BONDS, SERIES 2017 A (WEST VIRGINIA INFRASTRUCTURE FUND)
BOND RESOLUTION
Table of Contents
AKTICLE 1 STATUTORY AUTHORITY, FINDINGI
Section 1.01 Authority for this Resolution Section 1.02 Findings Section 1.03 Bond Legislation Constitutes Coq Section 1.04 Definitions ‘h
AUTHORIZATION OF DESIGN
Section 2.01 Authoriza esign, A’ ipping of the Project
AUTHORIZAT N AND SALE OF BONDS; AUTH~ N OF LOAN AGREEMENT
Executioi
Section 3.06 Section 3.07 B tedness of the Issuer Section 3.08 B dge of Net Revenues; Lien Positions with Respect to
Section 3.09 Delivery o Section 3.10 Form ofBonz7 FORM OF SERIES 2017 A BOND Section 3.1 1 Sale of Bonds; Approval and Ratification of Execution of Loan Agreement Section 3.12 Filing of “Amended Schedule”
1 ARTICLE SV [RESERVED]
ARTICLE V FUNDS AND ACCOUNTS; SYSTEM REVENUES AND APPLSCATION THEREOF
Section 5.01 Establishment of Funds and Accounts with Depository Bank Section 5.02 Establishment of Funds and Accounts with Commiss.jp
Section 5.03 System Revenues; Flow of Funds A
ARTSC BOND PROCEEDS; CONSTR
Section 6.01 Application of Bond Proceeds; Section 6.02 Disbursements from the Bond
Section 7.01 General Covenants of the 1: Section 7.02 Bonds not Section 7.03 ith Respect to Prior Bonds Section 7.04 Section 7.05 Section 7.06 Issuance7
Section 7.12 Section7.13 Section 7.14 Section 7.15 Section 7.16 Connectio Section 7.17 Completion avoperation of Project; Permits and Orders Section7.18 Res erv ed Section 7.19 Statutory Mortgage Lien Section 7.20 Compliance with Loan Agreement and Law Section 7.21 Securities Laws Compliance Section 7.22 Contracts; Change Orders; Public Releases
11 ARTICLE VI11 INVESTMENT OF FUNDS; USE OF PROCEEDS
Section 8.01 Investments Section 8.02 Certificate as to Use of Proceeds; Covenants as to Use of Proceeds
ARTICLE IX DEFAULT AND REMEDIES
Section 9.01 Events of Default Section 9.02 Remedies Section 9.03 Appointment of Receiver
Section 10.01 Payment of Bonds
Section 11.01 A Section 11.02 B Section 11.03 Sever
... 111 E-mail correspondence from Eric Coberly, P.E. Chris Negley
From: Eric Coberly
No permits are required for the specified work so that section is complete.
Eric J. Coberly, P.E. E.L. Robinson Engineering Project Manager 5088 Washington St. West Charleston, WV 25313
Direct Dial: 304.833.9021 T: 304.776.7473 x262 C: 304.767-5490 F: 304.776.6426 [email protected] www.elrobinsonengineerina.com
From: Chris Negley [rnailto:[email protected]] Sent: Tuesday, July 11,2017 1053 AM To: Randall Lewis
Re-sending as I had the wrong Eric before.
Thanks, Chris
Christooher D. Nealev I Member
1411 Virginia Street, East, Suite 200 Charleston, WV 25301 P.O. Box 3953, Charleston, West Virginia 25339 Phone: 304.345.1400 I Fax: 304.343.1826 I Connect: 1 Attorney Bio
CONFIDENTIALITY NOTE: This e-mail and any attachments are confidential and may be protected by legal privilege. If you are not the recipient, be aware that any disclosure, copying, distribution or use of this e-mail or any attachment is prohibited. If you have received this e-mail in error, please notify us immediately by returning it to the sender and delete this copy from your system. Thank you for your cooperation.
From: Chris Negley Sent: Tuesday, July 11,2017 10:45 AM To: Randall Lewis
I Putting together the filing. The PER has a milestone of June 1for all permit filings. What is the status of this section
Thanks, Chris
Christopher D. Negley I Member <matl,m~@sk, An~mq~ut Luv 1411Virginia Street, East, Suite 200 Charleston, WV 25301 P.O. Box 3953, Charleston, West Virginia 25339 Phone: 304.345.1400 I Fax: 304.343.1826 I Connect: I Attorney Bio
CONFIDENTIALITY NOTE: This e-mail and any attachments are confidential and may be protected by legal privilege. If you are not the recipient, be aware that any disclosure, copying, distribution or use of this e-mail or any attachment is prohibited. If you have received this e-mail in error, please notifv us immediately by returning it to the sender and delete this copy from your system. Thank you for your cooperation.
2 Term Loan Sheet from Citizens Bank Poc&ontas Count! PSD PO Bok 160 Slat>t'orh. WV 26291
Gent leiiien:
Citizens Rank of West Virginia ("Rank") is pleased to consider establishins a term loan IO Pocahontas Countv Public Senice Dim ("Borrower") in an amount up $256.000 for the piirp~s~of purchasing trucks and equipment.
Based upon our discussions and the information you have presented to the Bank. \vc are pleased to present the enclosed Commitment Letlrr as a preliminary outlinc of a credit facility for your consideration. If' you wish to proceed on this basis. please sign the encloscd copy of this Icner and retiiiii it to me. lhis Commitment Letter will expire August 4. 201 7. and if accepted the loan must close by Auxust 31. 201 7.unless otherwise extended by thc Bank.
Please feel free to contact ine at (304) 637-2169 with any questions on the 'leiin Sheet. I look forward to hearing from you soon
Kindest Regards.
., Franklin W. Hinziiian.iSVP!CLO
ACCEPTED AND AGREED TO:
Pocahontas Count! PSD A. Basic Credit Terms
Borroner: Pocahontas County Public Service District.
.-lmount of loan. Up-to Two Hundred Fifty-Sis Thousand and OOilOO DOLLARS ($156.OOO.00). interest rate: 3.95% (if a regulating authority deems this transaction to be taxable. then this rate will be adjusted accordingly at that time to a taxable rate)
Repa) inent teiiiis: 5 year amortization of principal and interest with estimated nionthl), payments of$4.716.00.
Prepayment: May be prepaid. in whole or in part. at any time without penalty. All partial prepayments will be applied to the principal installments in iwerse order of maturity, and early payments will not relieve Borrower or Bonower's obligation to continue to make payments tinder the payment schedule. rather. they will reduce the principal balance due and may result in Borrower making fewer payments.
Collateral: First lien on all personal property being purchased by the Borrower with these proceeds.
Guarantors: NIA
B. Additional Terms and Covenants of Borrower
Financial Statements: Borrower's agreement to furnish Bank audited financial statements (balance sheet and income statement) prepared on a yearend basis and in accordance with generally accepted accounting principals in effect on the date such financial stateinents were prepared. within 90 days of each fiscal year-end. beginning June 30. 201 7. Such financial statements will he accompanied and supported by such detail as may be requested by Bank.
No additional liens: Borrower's and Guarantor's agreement not to grant or allow an!; securir! interest. pledge. lien or other encumbrance on any assets that constitute a portion ofthe Bank's collateral. except those in l'nvor ofthe Bank.
Field Examination: Bank will have the right to conduct routine Iieid examinations with respect to Borrower. its operations. and the Property.
\?--+?- Initial E\!ents of Default: Such specified events as Bank inay require. including. without limitation. any nonpayment. incorrect or misleading representations or warranties. noncompliance with covenants or breach of warranties. or tlie bankruptc? or insolvency of Bomwer or guarantors.
Remedies In Event oi' Default: Upon the occurrence of ai1 event of default. Bank will haw such specified remedies as Bank niay require. including. without limitation. the option to declare the entire outstanding balance due under the facility outlined herein to he ininiediately due and payable and to lbrcclose upon all collateral securing repayment of the facility. Go\wning Law: All legal aspects of the facility outlined herein will be governed b) and construed in accordance with the laws of the State of West Virginia.
Representations and Warranties: The undersigned acknowledge that this term sheet is based materially upon financial information provided to the Bank by Borrower and others. and the undersigned hereby warrant and represent that such infoniiatioii was true and correct in all material respects when rendered and thai no material change has occurred therein through the date of the execution of this document. All material facts relating to the Credit or to the assets. business. profits. prospects. or conditions (financial or otherwise) of the Borrower have been disclosed to Bank by Borrowr and Guarantors.
Lien Property: Bank would have to receive evidence that its security interest in the Personal Property is a first priority lien therein and thereon. in fonii and substance satisfactory to Bank and its counsel.
Insurance: Bailk will have to receive evidence of insurance covering the Property. in amounts and in form satisfactory to Bank.
C. Documentation
The facility outlined herein will be evidenced by a loan agreement. promissory note. security ayreement. deeds of trust. guaranties. and such other agrecments. instruments. and documents as Bank and its counsel may require in their sole and absolute discretion. Borrower shall cause its counsel to render such legal opinions concerning the facility and tlie documents as may reasonably be required by Bank. All such docuiiientation would have to be satisfactory in fonii and substance 10 Bank and its counsel.
b . Initial D. Origination Fee and Reimbursement of Expenses
Loan Origination Fee of $500.00
In addition. Borrower would be required to reimburse Rank for all out-of-pocket cosls incurred by Bank in connection with the financing outline herein. including. witlioui limitation. fees of counsel. lien search charges. title insurance premiums. and the cost of any audits. includinf any enviroiuiiental audits.
This Commitment Letter may not be relied upon by any third parry List of Plant Operators Name, classification and operator license number for the plant operators - Class 111 Lloyd Coleman Water WVOPO1393 Class 111 Heidi Hickson Water WVOPO3238 Class 111 Mark Jonese Water WVOP11008 Class I1 Jeff Wayne I Water I WVOPO7622 I Class 111 I Robert Legg Water WVOP10340 Class II Nate Dean Water WVOP29861 Class II Marty Clevenger Water WVOP30069 Class I Seth Clevenger Water WVOP31399 Form No. 14 Form No. 14
PUBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON
Entered by the Public Service Commission of West Virginia, in the City of Charleston on the
~ day of ,2017.
CASE NO.
NAME OF APPLICANT:
Pocahontas County Public Service District
APPLICATION FOR A CERTIFICATE OF CONVENIENCE AND NECESSITY TO:
Purchase the assets of Cheat Mountain Water, Inc., (“CMW’) and thereafter provide water services to the approximately 606 former customers of CMW as provided in an Asset Purchase Agreement dated May 25,2017, and executed among CMW, Snowshoe Mountain, Inc. (“SMI”) and the District (“APA”). Further, and pursuant to the APA, the District will acquire from CMW and operate all of CMW’s public utility assets (“CMW Assets”), and also will acquire from SMI certain additional assets owned by SMI that will facilitate District’s operation of the System (“SMI Assets”).
The proposed project will take place in the Snowshoe and Silver Creek Resort areas of Pocahontas County. In addition to purchasing the assets of CMW the District proposes to make renovations and improvements to the existing water production, water treatment and water production facilities. These improvements include: electrical service upgrade and miscellaneous repairs at the raw water pump station; providing a spare Raw Water Pump; installing a backup generator at the raw water pimp station; installing fencing at the raw water pump station; installing fencing at WTP, fencing of the backwash basin; fencing at various water supply wells; filter painting and media replacement; connection of emergency generator to WTP; miscellaneous WTP building repairs; replacing valves at WTP; emergency generator for one booster pump station; installing leak detection meters and installing various isolation valves.
The total estimated cost of the project is $2,365,700. The approved financing package involves a West Virginia Infrastructure & Jobs Development Council loan in the amount of $$2,109,700 (3% for 20 years) and a commercial loan in the amount of $256,000 (3.95% for five years).
COMMISSION ORDER
On , 2017, the Pocahontas County Public Service District filed an application, duly verified, for a Certificate to purchase the assets of Cheat Mountain Water Company, Inc., and certain assets from Snowshoe Mountain, Inc., to operate a water stystem in Pocahontas County. Pursuant to 524-2-1 1, West Virginia Code, IT IS ORDERED that the Pocahontas County Public Service District give notice of the filing of said application, by publishing a copy of the attached Notice of Filing once in a qualified newspaper as provided in W. Va. Code 559-3-1 et seq., published and of general circulation in counties where service is provided, making due return to this Commission of proper certification of publication within thirty (30) days from the date of publication.
IT IS FURTHER ORDERED that within thirty (30) days of the date of this Order, ~ shall have completed the mailing of separate notices to each of its customers by one or a combination of the following methods: (i) inclusion of the Form No. 14 Notice of Filing as a bill insert; (ii) separately mailing the Form No. 14 Notice of Filing; or (iii) only for utilities that bill by postcard instead of in an envelope, and who elect not to separately mail the Form No. 14 Notice of Filing, inclusion of a statement on a postcard billing as follows: “This utility is seeking a rate increase. Details available in newspaper publications or at the utility office after [utility to insert date application filed with Commission] by calling 304-572-2566” and the utility shall have made due return to this Commission of its affidavit as proper certification that the notice was provided.
IT IS FURTHER ORDERED that in the absence of substantial protest received within the stated thirty (30) day period, the Commission may waive formal hearing and grant the application based on the evidence submitted with the application and the Commission’s review thereof.
FOR THE COMMISSION
Executive Secretary Attachment to Form No. 14
PUBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON
CASE NO.
NAME OF APPLICANT:
Pocahontas County Public Service District
APPLICATION FOR A CERTIFICATE OF CONVENIENCE AND NECESSITY TO:
Purchase the assets of Cheat Mountain Water, Inc. (“CMW) and thereafter provide water services to the approximately 606 former customers of CMW as provided in an Asset Purchase Agreement dated May 25, 2017, and executed among CMW, Snowshoe Mountain, Inc. (“SMI”) and the District (“APA”). Further, and pursuant to the APA, the District will acquire from CMW and operate all of CMW’s public utility assets (“CMW Assets”), and also will acquire from SMI certain additional assets owned by SMI that will facilitate District’s operation of the System (“SMI Assets”).
The proposed project will take place in the Snowshoe and Silver Creek Resort areas of Pocahontas County. In addition to purchasing the assets of CMW the District proposes to make renovations and improvements to the existing water production, water treatment and water production facilities. These improvements include: electrical service upgrade and miscellaneous repairs at the raw water pump station; providing a spare Raw Water Pump; installing a backup generator at the raw water pimp station; installing fencing at the raw water pump station; installing fencing at WTP, fencing of the backwash basin; fencing at various water supply wells; filter painting and media replacement; connection of emergency generator to WTP; miscellaneous WTP building repairs; replacing valves at WTP; emergency generator for one booster pump station; installing leak detection meters and installing various isolation valves.
The total estimated cost of the project is $2,365,700. The approved financing package involves a West Virginia Infrastructure & Jobs Development Council loan in the amount of $$2,109,700 (3% for 20 years) and a commercial loan in the amount of $256,000 (3.95% for five years).
NOTICE OF FILING
On , 2017, the Pocahontas County Public Service District filed an application, duly verified, for a Certificate to purchase the assets of Cheat Mountain Water Company, Inc., and certain assets of Snowshoe Mountain, Inc., to operate a water system in Pocahontas County.
The project will take place in the Snowshoe and Silver Creek Resort areas of Pocahontas County. The Pocahontas County Public Service District proposes to acquire and make limited renovations and improvements to the existing, privately-owned Cheat Mountain Water Company, Inc.’s water production, water treatment and water production facilities. The limited improvements include: electrical service upgrade and miscellaneous repairs at the raw water pump station; providing a spare Raw Water Pump; installing a backup generator at the raw water pimp station; installing fencing at the raw water pump station; installing fencing at WTP, fencing of the backwash basin; fencing at various water supply wells; filter painting and media replacement; connection of emergency generator to WTP; miscellaneous WTP building repairs; replacing valves at WTP; emergency generator for one booster pump station; installing leak detection meters and installing various isolation valves.
Owing to the type and small scope of the work, no viable alternatives exist for the system improvement portion of the project.
The Pocahontas County Public Service District (Applicant) estimates the cost of the project to be $2,365,700. It is proposed that asset purchase and construction will be financed as follows: a West Virginia Infrastructure & Jobs Development Council loan in the amount of $$2,109,700 (3% for 20 years) and a commercial loan in the amount of $256,000 (3.95% for five years).
The application is on file with and available for public inspection at the Public Service Commission, 201 Brooks Street, in Charleston, West Virginia.
The utility anticipates charging the following water rates for its customers: (note: these rates apply only to current customers of CMV who are to be acquired; there will no rate increase for current water customers of the District located in other parts of Pocahontas County).
APPLICABILITY Applicable for entire territory serviced
AVAILABILITY OF SERVICE Available for condo and commercial service
RATES Efficiency w/o a kitchen $ 14.59 per unit Efficiency $ 16.67 per unit 1 Bedroom $25.01 per unit 2 Bedroom $26.57 per unit 3 Bedroom $28.65 per unit 4 Bedroom $30.23 per unit 5 Bedroom $31.77 per unit 6 Bedroom $33.85 per unit Hot Tub $ 3.12 per unit
Per M Gal. Commercial $ 9.45 Restaurant Customer Owned Wells $ 162.50 Compressor House Customer Owned Wells $ 0.00
An Efficiency is defined as a one room unit with kitchen and bedroom facilities,
Lofts, Bunkrooms or other rooms used for sleeping quarters (other than living rooms) in Residential units will be counted as Bedrooms.
Residential Hot Tub is defined as any Hot Tub, Jacuzzi, Hydra Spa or other similar type tub that is larger than a standard bathtub in either length, width or depth. Jacuzzis that are similar in size to a standard foot bathtub but have water jets will not be subject to this additional charge.
Commercial Unmetered (Available only to those customers currently billed under this tariff) each unmetered Commercial customer will remain under the rates as existing prior to the filing of this case until the time meters are installed.
DELAYED PAYMENT PENALTY The above tariff is net. On all current usage billings not paid within twenty (20) days, ten percent (10%) will be added to the net current amount unpaid. This delayed payment penalty is not interest and is not to be collected only once for each bill where it is appropriate.
DISCONNECTION OR RECONNECTION FEE $30.00
TAP FEE $300.0
These rates represent the following project-related increases to become effective upon substantial completion of the project unless otherwise ordered:
($)INCREASE (%)INCREASE (DECREASE) (DECREASE)
Efficiency w/o kitchen 3.37 30% Efficiency 3.85 30% 1 Bedroom 5.71 30% 2 Bedroom 6.13 30% 3 Bedroom 6.61 30% 4 Bedroom 6.98 30% 6 Bedroom 7.33 30% Hot tub 0.72 30% Commercial 2.18 30% Restaurant 37.50 ___ 30%- Compressor (425.00) (1 00%) The proposed increased rates and charges related to the project will produce approximately $ 164,347 annually in additional revenue, an increase of 19.1 1 %. The total increase granted will not exceed this estimate unless further notice is provided. There are no proposed rates and charges not related to the project.
The increases shown are based on averages of all customers in the indicated class. Individual customers may receive increases that are greater or less than average. Furthermore, the requested rates and charges among the various classes of customers are only a proposal and are subject to change (increases or decreases) by the Public Service Commission in its review of this filing.
Anyone desiring to protest or intervene should file a written protest or request to intervene within thirty (30) days following the date of this publication unless otherwise modified by Commission order. Failure to timely protest or request to intervene can affect your right to protest aspects of this certificate case, including any associated rate increases, or to participate in future proceedings. All protests or requests to intervene should briefly state the reason for the protest or request to intervene. Requests to intervene must comply with the rules on intervention set forth in the Commission’s Rules of Practice and Procedure. All protests and requests to intervene should be addressed to Sandra Squire, Executive Secretary, P. 0. Box 812, Charleston, West Virginia 25323.
In the absence of substantial protest received within thirty (30) days of this publication, the Commission may waive formal hearing and grant the application based on the Commission’s review of the evidence submitted with the application. Memorandum from Robert W. Decrease, P.E. STATE OF WEST VIRGINIA DEPARTMENT OF HEALTH AND HUMAN RESOURCES BUREAU FOR PUBLIC HEALTH OFFICE OF ENVIRONMENTAL HEALTH SERVICES Jim Justice Bill J. Crouch Governor Cabinet Secretary
MEMORANDUM
TO Chris Jarrett, Funding Committee WV Inhtn~ctweacd Jobs Development Council
FROM Robert W. Decrease, P. E. Water Technical Review Committee
DATE: May31,2017
RE. Pocahontas County PSD IJDC Prelmmary Application Number: 2016W-1697 Cheat Mountain Water System Acquisition, Plant and Line Upgrade Pocahontas County
1. The Committee has reviewed the pre-application and preliminary enginwing report submitted for the above referenced project in accordance with Chapter 31, Article 15-A It has been determined that the project is:
a. 4 Consistent with the intent of the Inhmcture and Jobs Development Act and is the most cost-effdve and environmentally sound altema!ive for solving the dnnlang water needs in this area.
b. Consistent with the Act but may not be the most cost-effectiveand environmentally sound altmative for solving the drinking water needs in this area.
C. Consistent with the intent of the Act and most cost-effective and environmentally sound alternative for solving the drinking water needs in this amat that certain issues need to be addressed prior to design and construction, as the attached comments indicate.
350 Capitol Street, Room 313 Charleston, West Virginia 25301-3713 Telephone: (304) 558-2981 2. Our recommendaton is that:
a. The Funding Committee needs to review the proposed sources of funding to determine the best mix of grant and/or loan funds in accordance with applicable guidelines.
b. The Funding Committee should recommend that Council approve the proposed project and its funding plan.
C. The Funding Committee does not need to review the funding assumptions on this project because of deficiencies in the application. The proposed project funding should be postponed until technical comments have been resolved.
d. The project to be referred to the Consolidation Committee.
3. otherm&
The PSC Stafftypically compares current rates to 1.25% (%33.50), 1.5% ($40.20), 1.75% ($46.90), and 2.00/0 ($53.60) of the Median Household Income (MHI). Gong level rates for the Pocahontas County F’ublic Service District (District) are ($47.15 for 3,400 gallons), which are above the rates atkibutable to I .7S% of MHI, but Below the rates attributable to 2.00? of MHI. Current residential rates for Cheat Mountain Water Company, Inc. (Cheat Momtain) are based on bedroom units, which cannot readily be compared to MHI. The preferred finding package consisting of an UDC loan for $2,109,700 at 3% for 20 years, propod rates ($47.15 for 3,400 gallons for the District, and Cheat Mountain rates as shown in the PSC Staff Review Comments) will provide a cash flow qlusof $32,032 and debt service coverage of 210%. The PSD may he eligible for 2%, 30 year financing and the PSC has pvided an altdve cash flow analysis (Scenario 1-A). This scenario will provide a cash flow surplus of $84,399 and debt service coverage of 289%. The District’s Going Level rates (47.15 for 3,400 gallons) will become effective for service rendered on and afier December 14,2017, per the Disrrict’s Tariff #8 Supplemental Schedule. There are various discxepancies in the Applicant’s Rule 42 Exhibit Bill Analyses that rault in operation revenues at per books, going level and proforma being misstated. More detailed justification including a Rule 42 Exhibit will be required when filing for a Certificate of Convenience and necessity. PSC Staff spoke with the project sponsor’s Accountant regadmg these cmcerns. The Applicant is pmposing sepmte rates for the proposed project. PSC Staff will evaluate the issue of separate rates during any fi~tu~Certificate filing and may advocate for unified rates per Commission policy and precedent. Concans outlined in the Tech& Memo should also be addressed RWD:ped pc: OEHS Fairmont Do To be distributed at the Funding Committee Meeting STATE OF WEST VIRGINIA DEPARTMENT OF HEALTH AND HUMAN RESOURCES BUREAU FOR PUBLIC HEALTH OFFICE OF ENVIRONMENTAL HEALTH SERVICES Jim Justice Bill J. Crouch Governor Cabinet Secretary
MEMORANDUM
TO Robert W. Decrease, P.E., Manager Infrastructure &Capacity Development
FROM Paul E. Daniels, P.E. Inhs@ucture& Capacity Development
DATE: May 3 1,2017
RE: Pocahontas County PSD IJDC Prelmunay Application Number 2017W-1697 Cheat Mountain Water System Acquisition, Plant and Line Upgrade Pocahontas County
RECOMMENDATION: This preliminary application appears technically feasible and is recommended to be forwarded to the Funding Committee.
PROJECT SCOPE This pdhmyqpli& will acquire all assets and real property of Cheat Mountain Water, Inc. including water treatment plant, pump stations, water storage tanks, wells, pressure reducing valves, distribution system components and related appurtenances. PmM will also povide capital upgradest0 impve~~ty.hupgndesaret0inchded~calsaviceand~atrawwatapnnp~n, sparelnrmpatrawwataplmpslaton,~gpnaatoratrawwateclnrmp~~~atrawwaterprmp station,watertreahnentplant~),~bssinandwelt$sltapaintingatdmediaedialrplacanent atwTp,wire gnagency~t0wTp,wTp~~~l~womv~v~at~,replacenent~forwTp, replacanen~pnnpSTopoNJorldpumps$tioqanagencygaEaatoratTopofwoddppnpstatiOqleakmftas andisdationvatvg. waterwillbepraidedviathe~watectreahnentplantsw~~haveslrLFcienf~ capxitytosavetheexisbilg~
The estimated total project cost is %2,109,700[UnCrOan: $~l09,700(30/420yrs.)~~~].Wper cusbmeriSs957.
Note: Cost per customer calculated based on Cheat Mountain Water Company, Inc. customers.
350 Capitol Street, Room 313 Charleston, West Virginia 25301-3713 Telephone: (304) 558-2981 Pocahontas County PSD Project No.: 2017W-1697 May31,2017
NEED FOR THE PROJECT: The PER indicates that by attaining ownership of the Cheat Mountain Water System, the Pocahontas County PSD will ensure potable water service to the existing customer base and explore a more equitable rate structure, including reducing rates for the customers in Durbin, Frank, and Bartow areas. It would also provide the financial capability of extending to adjacent areas to provide potable water to unserved areas. Completing the capital upgrades should improve system reliability and prevent service disruption in the event of the loss of power or equipment malfunction.
CONCERNS: 1. The unaccounted for water is 48.38% according to the 2016 PSC Annual Repod, however, the 2016 WVBPH Sanitary Sweyindicated -great strides have been made and it was at 13% in March 2016. 2. User rates on the Accountant’s page were inaccurate. 3. PSC Staff nota that an a&ma!ive determination of need for the project must be established in a Certificate filing at the PSC and that the acquisition costs must be approved by the PSC. PERMITS: A permit required from the WV Bureau for Public Health prior to construction.
Construction dvities with a dktwbed area of one (1) acre or greater are required to register for the NPDES Stom Watw Conshuction GRI~Pamit No. WVOl15924.
This project will require approval of the PSC and may quire the issuance of a Certificate of Convenience and necessity. The project sponsor should reference this application number on the PSC’s Form No. 4 when it’s application is filed at the Commission givm the requirements of West Virginia Code 24-2-1 1 (c) and (e).
ENGINEERING FEES: The engineering design fees for this project are “below the curve” for very complex for modified construction costs as referenced in the American Society of Civil Engineers manual of practice. The total fees for this project are ‘‘above the curve” for average and very complex for both new construction and modified construction costs as referenced in the American Society of Civil Engineers manual of practice. The sponsor does need to make a written request for a waiver approval eom the WVIJDC for the engineering fees.
ASSET MANAGEMENT PLAN AND ANNUAL MAINTENANCX AUDIT: The UDC application states that Pocahontas County PSD does have a formal asset management plan in place and has not completed an annual maintenance audit for the current year. CAPACITY DEVELOPMENT PROGRAM ASSESSMENT: The IJDC aoolication states that Pocahontas Countv PSD has comoletcd a Caoacitv DeveloDmmt Analysis (CDA) within the last 5 years; however, B&eau for Public Health recoks sdow that aCDA has never been conducted on the system. Pocahontas County PSD Project No.: 2017W-1697 May31,2017
The April 2017 quarter of the EPA’s Compliance Tracking Tool (ETT) indicated the Pocahontas County PSD has a score of 9 which is below the EPA score of concern of 1I. The score was attained by failure to submit Public Notices for an August 2010 Total Coliform Rule sample,, 2012 and 2013 Lead Consumer Notices and receiving a violation because their 2016 Volatile Organic Chemicals sample was rejected by the lab for not having proper preservation. All violations have been resolved except for the total coliform violation.
Based upon information eom the Municipal Bond Commission, as of March 201 7, the Pocahontas County PSD is current on their water reserve funding requirements.
RANKING Public Health Benefit: 5 Compliance:O May 18,2017
Mr. Robert W. Decrease, P.E. Office of Environmental Health Services 350 Capitol Street, Room 3 13 Charleston, West Virginia 25301-3713
Re: Public Service Commission Staff Review Comments Application No. 2017W-1697 Pocahontas County PSD Infrastructure Preliminary Application
Dear Mr. Decrease:
As requested, the Technical Staffof the Public Service Commission of West Virginia has completed its review of the abovereferenced Infrastructure application. In light of Technical Staffs comments enclosed herewith, we are recommending the application be:
X forwarded to the Funding Committee
- forwarded to the Consolidation Committee
-returned to the Applicant
Please advise if you have any questions.
Sincerely,
Jonathan M. Fowler, P.E. Engineering Division
JMF:vt PUBLIC SERVICE COMMISSION STAFF TECHNICAL REVIEW
DATE: May 18,2017
PROJECT SPONSOR: POCAHONTAS COUNTY PUBLIC SERVICE DISTRICT
PROJECT SUMMARY: Acquisition of Cheat Mountain Water system and system upgrades to improve system reliability and prevent service interruption in the event of loss of power or equipment malfunctioning.
PROPOSED FUNDING: WJDC Loan 3%, 20 years $2,109,700
CURRENT DISTRICT RATES: $50.19 3,400 gallons $58.56 4,000 gallons
GOING LEVEL AND PROPOSED DISTRICT RATES: $47.15 3,400 gallons $55.02 4,000 gallons
CURRENT AND PROPOSED RATES FOR CHEAT MOUNTAIN WATER COMPANY: See Comment 4C below
ADDliCatiOn No. 2017W-1697
RECOMMENDATION: &forward to the Funding Committee. -forward to the Consolidation Committee. -return to the Applicant.
FINANCIAL Bonnie BostodSteve Edens
1. Stafftypically compares current rates to 1.25% ($33.50), 1.5% ($40.20), 1.75% ($46.90), and 2.0% ($53.60) of the Median Household Income. Going Level rates for the Pocahontas County Public Service District (District) are ($47.15 for 3,400 gallons), which are above the rates attributable to 1.75% of the MHI, but below the rates attributable to 2.0% of the MHI. Current residential rates for Cheat Mountain Water Company, fnc. (Cheat Mountain) are based on bedroom units, which cannot readily be compared to MHI.
Page 1 of 5 2. Using Scenario 1, the preferred funding package consisting ofan IJDC loan for $2,109,700 at 3% for 20 years, proposed rates ($47.15 for 3,400 gallons for the District, and Cheat Mountain rates as shown in Comment 4C) will provide a cash flow surplus of $32,032 and debt service coverage of 210.40%.
3. Using the Scenario 2 alternate loan package of $2,109,700 (in uncommitted funds) at 5% for 40 years (paid back over 38 years), proposed rates ($47.15for 3,400 gallons for the District, and Cheat Mountain rates as shown in Comment 4C) will provide a cash flow surplus of $50,438 and debt service coverage of 232.63%.
4. FINANCIAL COMMENTS:
A. Staffs detailed adjustments are listed on Attachment A for Scenario 1 (Preferred Funding Package) and Attachment B for Scenario 2 (Loan Package).
B. Staff prepared the attached Cash Flow Analyses utilizing information from the Annual Reports for the Fiscal Year Ended June 30,2016, for the District and Cheat Mountain, and the Applicant’s Rule 42 Exhibit submitted with the application, except as noted on Attachments A and B.
C. The Going Level and Proposed Rates for Cheat Mountain are:
Cheat Mwntaln Water Company, Inc. Golng Level Proforma Residential effic.w/o kitchen $ 11.22 per unit $ 14.59 perunit efficiency $ 12.82 perunit $ 16.67 perunit 1 bedroom $ 19.24 peruni! $ 25.01 perunit 2 bedroom $ 20.44 per unit $ 26.57 per unit 3 bedroom $ 22.04 perunit $ 28.65 perunit 4 bedroom $ 23.25 per unit $ 30.23 perunit 5 bedroom $ 24.44 perunit $ 31.77 perunit 6 bedroom $ 26.04 perunit $ 33.85 perunit hot tub $ 2.40 perunit $ 3.12 perunit commercial $ 7.27 per 1OOOgal. $ 9.45 per lo00 gal. restaurant (weU) $ 125.00 per loo0 gal. $ 162.50 per lo00 gal. compressor house (well) $ 425.00 per 1OOOgal. $ - per 1Wgal.
D. The Applicant provided a Max Rate Cash Flow Analysis which projected lower revenues than its Target Rate Cash Flow Analysis, without financial data to
Page 2 of 5 support the lower revenues. Therefore, Staff calculated its Cash Flow Analysis for Scenario 2 using the Applicant’s proposed target rates ($47.15 for 3,400 gallons for the District, and Cheat Mountain rates as shown in Comment 4C).
E. The District’s Going Level rates ($47.15 for 3,400 gallons) will become effective for service rendered on and after December 14,2017, per the District’s Tariff #8 Supplemental Schedule.
F. Senate Bill 234, effective June 12,2015, required water and sewer utilities that are political subdivisions of the state to maintain a cash working capital reserve in an amount of no less than one-eighth (1/8) of actual annual operation and maintenance expenses. It should be noted that the cash flows provided by the project sponsor include funding for the 1/8 cash working capital reserve. Staff accepted that amount in its analyses. However, this amount may be reviewed by the Commission in future filings.
G. There are various discrepancies in the Applicant’s Rule 42 Exhibit Bill Analyses that result in operating revenues at per books, going level and proforma being misstated. More detailed justification including a Rule 42 Exhibit will be required when filing for a Certificate of Convenience and Necessity. Staff spoke with the project sponsor’s Accountant regarding these concerns.
H. It should be noted that the Applicant is proposing separate rates for the proposed project. Staff will evaluate the issue of separate rates during any future Certificate filing and may advocate for unified rates per Commission policy and precedent.
ENGINEERING: J. M. Fowler, P.E.
1. This project will require approval ofthe PSC and may require the issuance of a Certificate of Convenience and Necessity. The project sponsor should reference this application number on the PSC’s Form No. 4 when its application is filed at the Commission given the requirement of West Virginia Code 24-2-1 1 (c) and (e). Staff notes that an af€irtnative determination of need for the project must be established in a Certificate filing at the PSC. Staff krther notes that the acquisition costs must be approved by the PSC.
2. Scope: The applicant proposes to acquire and make limited renovations and improvements to the existing, privately-owned Cheat Mountain Water Company’s water production, water treatment and water distribution facilities. The limited improvements include: electrical service pgrade and miscellaneous repairs at the
Page 3 of 5 raw water pump station ;provide a spare Raw Water Pump; install a backup generator at raw water pump station; install fencing at raw water pump station; install fencing at WTP; fencing of backwash basin; fencing at various water supply wells; filter painting and media replacement; connection of emergency generator to WTP; miscellaneous WTP building repairs; replace valves at WTP; replacement pumps for WTP; replacement pumps for one booster pump station; emergency generator for one booster pump station: install leak detection meters and install various isolation valves. The estimated construction cost of these improvements is approximately $624,000.
Customer Density: N/A - internal improvements to an existing system.
Cost per Customer: about $957. (Calculated using the total project cost estimate of $2,109,700 and 2,204 existing Snowshoe Mountain area customers.)
3. Project Feasibility: The project is technically feasible and will transfer a relatively small, private utility to public ownership. Such transfers typically result in long- term benefits to the customers.
4. Project Alternatives: Owing to the type and small scope of the work, no viable alternatives exist for the system improvements portion of the project. As stated in the PER “Alternatives to the acquisition itself were not analyzed; both parties have expressed their desire for a full transfer of assets. A partial acquisition or maintenance agreement would add increased operational complexity and would not serve to address present and future issues with the system.” Staff concurs.
5. Consolidation: This acquisition-and-improvements proposal represents an effective means of consolidation of utility service in the general Snowshoe Mountain area.
6. Inconsistencies: No significant or fatal inconsistencies were noted.
7. Operation and Maintenance (0 & M) Expenses: 0 & M expenses are expected to total about $588,000 following acquisition and were based on historical operating cost data for the Cheat Mountain system. Staff cautions that this figure must be documented fully in any filings made to the PSC and complete supporting calculations must be provided. We note that the Cheat Mountain system suffers from a very high level of Unaccounted Water Loss (just above 48%). This must be considered and should be addressed in any long range planning following the proposed acquisition.
Page 4 of 5 8. Engineering Agreement: The application includes information to determine compliance with West Vireinia Code $$SG-l-I, Total technical services (engineering) costs ($296,000) for the project equal 39.2% of the construction cost however; this figure is skewed negativeIy by the fact that the project cost includes significant “other” costs besides construction. (We note that these technical fees amount to only about 14% of the total project cost and are opined acceptable.)
- Performance Measures: 1 I PI. Asset Management, 1 I PI Environmental Manapnent: .-. -.. - -. .. .-. 0 1 PI. I Readiness to Proceed: I 0 1R.J Cost Effectiveness: -. I I 1 PI. Compliance with PSC Orders: ; 0 I Pi.
Page 5 of 5 POCAHONTAS COUNTY PSD (WATER) PREFERRED FUNDING PACKAGE CASH FLOW ANALYSIS SCENARIO 1 YEAR ENDED June 30,2016 APPLICATION NO. 2017W-1697 Md May 18,2017 Rule 42 Rule 42 Going Level Proforma Mh PK Application Pet Application staff PK staff P=+ Befm Pmject with PmicR Adjuslmenrr Analysis 1 2 3 4 s S s f AVAILABLE CAS@ O-ing RCVUIWS 854,476 I,O 18,289 5,037 (1) 1,023.326 0th Oping Revenue 5,391 $926 5,926 Interest Income & Othcr Mi%. 23 23 23
Total Cash Available 859.890 1,024,238 5,037 1,029,275
Opaating Expaues 578,376 637,619 637,619 -lacs 61,988 23,175 23,175
Taal Cash Requirements Bcforc Deb! Scrvics 640,364 660,194 660,794
Cash Available for Deb? Swioe (A) 2 19,526 363,444 5,037 368,481 DEBT SERVICE RMUIR- Principal & lntacst (8) 33,328 175.133 175,133 Olha Debt 142.152 56,506 56.506 Resme Annunl @I I Wn 14,181 14,181 Renewal & Replacement Fund (2.5%) 21,491 25,606 126 (2) 25,732
Total Deb1 Service Rquiremnt 197.571 271,426 I26 271,552
SB 234 Cash Woriting Capital 64,897 64.897
Remaining Caqh 2 I.949 27,121 4.9 I1 32,032
Percent Coverage (A) (0) 658.68% 207.52% 210.4C%
Average Distria rate for 3,400 gnllon? s 54.19 S 50.19 S (3.04) S 47.15 Average District tule for 4,000 grlimr S 58.56 S 58.56 S (3.54) S 55.02 Chaf h!auuah Cunnwcb Swim: Average rate for 3,400 @lions S 24.72 S 32.13 S - S 32.13 Average rak- for 4,400 @Ions S 29.08 S 37.80 S . s 37.80
Gmng -1 Avetege Raela Chest Mountain residential Semke zm tad on Bearmuns ranging (mm $1 1.22 to $26.04 per unit proforma ~verageas- la Cm! MOunmin resKxntil)l Se~tcFare based On WrmUnits rawinp lrcm $14.59 m 533.85 per unit POCAHONTAS COUNTY PSD (WATER) Anacbment A CASH FLOW ANALYSIS PREFERRED FUNDING PACKAGE YEARENDED June30,2016 SCENARIO I APPLICATION NO 2017W-1697
Staff Adjustments
(I) Operating Revenues Per Staff Auilyds 1.023326 5,037 Per Application wlth Project 1,018JS9
Staffadjusted fa an iilcreay which occumd during the lest yeat and then adjusled for a Step 2 rate reduction effective December 2017.
(2) Renewal & Rtplncrmenl Fead (2.5%) Per Staff A~ly~b 25.732 I26 Per Application with Project r5.m
Staff used 2.5% ofthe projedion of ‘Operating & Other Revenues” as the basis ofthe mewal& replacement fund. POCAHONTAS COUNTY PSD (WATER) REVISED PREFERRED FUNDING PACKAGE CASH FLOW ANALYSIS SCENARIO 1-A YEAR ENDED June 30.2016 APPLICATION NO: 2017W-1697 May25.2017 Rule 42 Rule 42 Going Lcvel Profoma Per BPH Request: Per Application Per Application Staff Per Staff UDC Losn lor $2,109,700 at 28 Tor 30 YN. Before Project with Pmjecl Adjustments Analysis 1 2 3 4 $ $ $ $
AVAILABLE CAW Operating Revenue< 854,476 1,018,289 5,037 (I) 1,023,326 Other Operating Revenue 5,391 5,926 5.926 Interest Income & Other Mise 23 23 23
Total Cash Availahle 859,890 1,024,238 5,037 1,029,275
OPERATING DEDUCTIONS Operating Expenses 578,376 637,619 637,619 Taxes 61,988 23,175 23,175
Total Cash Requirements Before Debt Service 640,364 660.794 660,794
Cash Available for Debt Service (A) 219.526 363,444 5,037 368.48 I
DEBT SERVICE RWUIREMENTS Pnncipal & Interest (B) 33,328 175,133 (47,607) (2) 127.526 Other Debt 142.752 56,50(, 56.506 Reserve Account @ IO% 14,181 (4.761) 13) 9,420 Renewal &Replacement Fund (2.5%) 21,497 25.m 126 (4) 25.732
Total Debt Service Requirement 197,577 271,426 152,241) 219, I85
SB 234 Cash Workmg Capital 64,897 64,897
Remaining Cash 21,949 27.121 57,278 84,399
Percent Coverage (A) I (6) 658.68% 207.528 288.95%
Average District rate for 3,400 gallons $ 50.19 $ 50.19 $ (3.04) $ 47.15 Average Disrricl Tale for 4,000 gallons s 58.56 $ 58.56 16 (3.54) $ 55.02 Cheal Mounlain Commercial Service: Average rate for 3,4W gallons $ 24.72 S 32.13 S $ 32.13 Average rate for 4,wO gallons $ 29.08 $ 37.80 $ - s 37.80
Going Level Average Rates for Cheat Mountain residential Service are based on Bedroom Units anging fmm $11.22 lo $26.04 per unit Proforma Average Rates for Cheat Mounlain residential Service are based on Bedraom Units ranging from $14.59 la $33.85 per "nil POCAHONTAS COUNTY PSD (WATER) Attachment A CASH FLOW ANALYSK REVISED PREFERRED FUNDING PACKAGE YEAR ENDED June 30,2016 SCENARIO 1 -b APPLICATlON NO 2017W-1697
Stan Adjustments
$
(1) Operating Revenuer Per Staff Annlysis 1,023,326 Per Application with Project 1,018,289
Staff adjusted for an increase which occurred dunng the test year and then adjusted for a Siep 2 rate reduction effective December 2017.
(2) Principal & Interest Per Stan Analysis 127,526 Per Application with Project 175,133
The difference in P&l is relaled to Staffs calculation of a loan of $2,109,700 for 30 years at 2%.
(3) Rserve Account @ 10% Per Staff Analysis 9,4m Per Application with Project 14,181
Staff assumed a 1% reserve on the new deb1
(4) Renewal & Replacement Fund (25%) Per Staff Analysis 25,732 Per Application with ProjecI 25,606
Staff used 2.5% of the proiection of "Operating &Other Revenues" as the basis of the renewal & replacement fund. POCAHONTAS COUNTY PSD (WATER) LOAN PACKAGE CASH FLOW ANALYSIS SCENARIO 2 YEARENDED: June30.2016 APPLICATION NO2017W-1697 Md May 18.2017 Rule 42 Rule 42 Going Level Rofonna *41 Per Application Per Application Staff PcrStaff p90 &fore Pmjm with Pmjea Adjumneats Aaaiysis 1 2 3 4 s S S I WBLECASU opeating Rcvenua 854,416 1,018,289 5.037 (1) 1.M3.326 Other Opting Revenue 5.391 5.926 5926 Interest lnmrne & Other Misc. 23 23 23
'liatd Carh Available 859,890 1.024238 5,037 1,029275 OPERATING DEDUCTIONS Operating Expews 578,376 637,619 637,619 Taxes 61,988 23.175 23.175
Total Cash Requircmenls MOA Debt Service 640.364 660,794 660.794
Cash Available for Dck Smicc (A) 219,526 363.444 5,037 368.48 I
BFBT SER VlCEWUIREMEN- Principal & Inurest IB) 33,328 175.133 (16.733) (2) 15a.400 other Oebt 142,752 56,506 56.506 Reserve AccOunt @ 1WL 14,181 (1,673) (3) 12.508 Renewal& Replscement Fund (2.5%) 21,497 25.606 126 (4) 25.732
Tolal Debt Servia Requirement 197,577 271,426 ( 18,280) 253, I46
SB 234 Cash Wwking Capital 64.897 64,897
Remaining Cash 2 1.949 27,121 23317 50,638
Peran1 covrrage (A) / (8) 658.68% 207.52% 232.63%
Average Distria rate for 3,400 gallons S 50.19 $ 50.19 I (3.04) $ 47.15 Avaagp District rate for 4.000 galloor S 58.56 S 58.54 S (3.54) s 55.02 Cheat Mountain Commercial Swvh: Average rate for 3.400 gallons s 24.72 s 32.13 S . s 32.13 Average me for 4.400 gallons s 29.08 s 57.80 S - S 37.80 POCAHONTAS COUNTY PSD (WATER) Attachment B CASH FLOW ANALYSIS LOAN PACKAGE YEAR ENDED Jane 30,2016 SCENARIO 2 APPLICATION NO. 2017W-1697
Staff Adjustments
Adjustment Derription
(If Optrating Revenuer Per Staff Analysis 1,023,326 5,037 Per Application with Project 1,018,289
Staff adjusted for an increase which owdduring the test year and then adjusted far a Step 2 me reduch effective December 2017.
(2) Principal & Interest Per StaffAnalysis 1%4W (16.W Per Applicatlon with ProJect 175,133
The difference in P&i is related to Staffs calculation of a loan of S2.109,700 for 40 years (paid aver 38 years) at 5%.
(3) Reserve Account @ 10% Per Staff Analysis 1W8 (1.673) Per Appiicntion with Project 14.181
Staffassumed a 10% reserve on the new debt.
(4) Renewal & Replacement Fvnd (2.5%) Per Staff Analysis 25.131 126 Per Appiiutlon with Project 25.606
StaRured 2.3% of the projection of "Operating & Other Revenues' as the basis oflhe renewal & replacemmt fund. Graph 1. Design Fee vs. Construction Cost for New Construction 2Om~-1697 Pocahontas County PSD 13
12
11 10.6 10
9
8 me -7 I3 c $6 2 5
4
3
2
1
0 Graph 2. Design Fee vs. Construction Costs for Modifications 2017W-1697
Construction Cost in Thousands ($1 j Total Fee vs. Construction Cost for New Construction 2017W-1697 39.27 - - ...... I Pocahontas CounQ PSD 35 i -.
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i 0 754 1000 zoo0 3009 4000 5000 6000 7000 8000 9000 1ooM) llW0 I Construction Cost in Thounsandr ($)
~ Total Fee vs. Construction Cost for Modifications 2017W-1697 39.27 ...... I Pocahontas County PSD 35 3 ,. .~...... ~. .... - . .~ i 1 ...... ~-1~...... ~ ...... ~ ...... ~- ...... - ...... j ..... ~,...... -......
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0 0 754 low 2000 3000 4ooo 5000 6000 7000 8000 9000 low 11w ConstructionCost in Thousands ($1 Ollice of Ahandoned Mine I.ands K! Keclamaiion Jim Juslice.(iovernor bo1 57th SWM SI: Ausm Capenoti. Cabinet Secretary Charleston, WV 25304 dcp.er.gov
MEMORANDUM
To: Mr. Robert W. DeCrease, P.E., Manager Infrastructure and Capacity Development
From: Roger A. Earle. P.E., Waterline Coordinator PbL Office of Abandoned Mine lands & Reclamation
Date: May 16,2017
Subject: Pocahontas County PSD - Cheat Mountain Water System Acquisition lJDC Preliminary Application: 2017W-1697
AMI, does not participate in acquisitions. routine improvements, or replacement of existing systems. Therefore, AML funds will not be available for this project.
cc: Ben Savage - Bureau for Public Health
Promoting a healthy environment. MEMORANDUM
MEMO TO Benjamin J. Savage, P. E. Office of Envimrnnmtal Health Services Bureau for Public Health
FROM:
General Permits & Support Team
DATE April 19,2017
SUBJECT Jn~cturePreliminary Application for thc Pocahontas County PSD 2017W- 1697): Cheat Mountain Water System Acquisition in Pocahontas County, WV. We have reviewed the above referenced project applicationinformation. The preliminary application indicates that the proposed project will include Pocahontas County PSD acquiring the exisring potable water trealmcat and distribution system, cu1Icnty owned and operated by CMW in the snowslloe area of Pocahontas county, wv. This system provides water to approximately 2,204 residential units and commercial customem, including Snowshoe Mountain resort area, Silver CreeL fesort area, and extending to the intersection ofU.S. 219 and Route 66 and the entrance to the Meadow at Hawthome. The system serves Snowshoe Mountain, Inc. (SMI) owned by Inlrawest, businesses, and private residents.
"he water treatment plant was first built in 1974 as a 350 gpm fwility. An upgradc in 1992 converted an existing 300,000-&dlon storage tank into a250,000-gallon combination flocculation and sedimentation spiral baain, which increased the plant's production CapabilitKS to 1,OOO gpm (1 -44MGD). The current tceatment train consists of coagulation, flocculation, and sedimentation in the spiral basin, filtmtion through two 500 gpm mixed media filters, and chlorine gas disinfection. The source of supply of raw water is Shnvers Lake, 334 acre-feet (109 million gallon) impoundment on Shavers Fork last exprupded in 1998.
Promoting a healthy environment. Benjamin J. Savage, P. E. April 19,2017 Page 2
The distribution system consists of 101,934linear feet of 12-inch and smaller diameter waterline, five (5) water storage tanks, three (3) booster pump stations, nine (9) pressure reducing valve stations, two (2) generators, 91 lire hydrants, valves and related appurtenances.
The Pocahontas County PSD is located in Pocahontas County, WV, and has an existing water system approximately thirteen (1 3) miles north of the project area, which provides water service to 272 customers in the Durbin, Frank, Bartow, and surrounding areas of Pocahontas County. The District also provides sewer service to customers in the Snowshoe, Silver Creek, and surrounding areas in Pocahontas County, which includes the CMW senice area,
The District is seeking to acquire an existing potable water treatment and distribution system. No construction activities are proposed except routine equipment replacement and maintenance as well as the installation of Security fencing at the treatment plant, backwash basin, raw water pump station, and wells. Therefore, no temporary or permanent environmental effects are anticipated as a result of this proposal.
The Cheat Mountain Water Company Treatment Plant discharges it backwash to its site, which is covered under WVNPDES Site Registration No.WVG640070 and expires July 18,2018.
In light of the above, we have no objection to this project as long as the appropriate provisions are taken to assure compliance with Chapter 22, Article 11, of the Code of West Virginia and any associated regulations. The responsible party may contact Doug Cast0 (304) 553-7972, should additional information be required.
JMP:daC cc: KatherynEmery
I OEHS District Review for Infrastructure Council Water Proiects
Water System: I Pocahontas CO. PSD I NDC Number: I 2017W-1697 Project Description: Cheat Mtn. Water System Acquisition Review by: Craig Cobb, P.E./Paul - Daniels, P.E. County: Pocahontas Date: May 19,2017
ties that it owns to the
I project? I
I are aware 00 in the project application? 9. 1 Is the management of the water system capable of I 10. Other comments
S:\ENGCOMOMI & CDVnhtructure Council\WaterL?O17L4pplications\O05 MayWocahontas County PSD 201 7W- 1697Unformation\District Reviews of UDC Water Projects Pocahontas Co PSD 201 7W-1697.doc Page 1 of 2 STATE OF WEST VIRGINIA DEPARTMENT OF HEALTH AND HUMAN RESOURCES BUREAU FOR PUBLIC HEALTH OFFICE OF ENVIRONMENTAL HEALTH SERVICES Jim Justice Bill J. Crouch Governor Cabinet Secretary
MEMORANDUM
TO: Bob Decrease, P.E., Manager Infrastructure and Capacity Development Unit
FROM: Angela R. King, Manager Capacity Development Program +;P+
DATE: May 4,2017
RE: Pocahontas County PSD (PWSID# 3303812) IJDC Application No.: 2017W-1697 Pocahontas County
The Pocahontas PSD preliminary infrastxucture application indicates that they are not seeking DWTRF monies. The system indicates in the application that they do have an asset management plan.
The question about having had a capacity development assessment (CDA) within the last 5 years was marked as yes. This is incorrect, as an assessment has never been conducted on the system.
Additional information that may be helpll to the UDC in their decisions regarding approval of this project relates to the system’s overall compliance. The Pocahontas PSD has a score of 9 on the April 2017 quarter of the EPA’s Compliance Tracking tool (En). The score was attained by failure to submit Public Notices (PNs) for an August 2010 Total Coliform Rule (TCR) sample, 2012 & 2013 Lead Consumer Notices (LCN), and receiving a violation because their 2016 Volatile Organic Chemicals (VOCs) sample was rejected by the lab for not having proper preservation. Most of these violations have since been resolved, except for one; Pocahontas PSD still needs to submit a PN for the outstanding August 2010 TCR violation.
Based upon information from the Municipal Bond Commission, as of March 2017, the Pocahontas PSD is current on their water reserve funding requirements.
If you require further information from the capacity development program, please contact me.
ARK
350 Capitol Streat, Room 313 Charleston, West Virginia 25301-3713 Telephone: (304) 558-2981