Logan County Public Service District Holden Water Company Acquisition
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LOGANCounrrv PUBLIC SERVICE D/STRICT P.O. Box 506 BOARD MEMBERS: Logan, WV25601 James R. Jeffrey, Chair (304) 946-2641 (TDD) May 26,2006 Ben F: Lowe, JI: Fa(304) 946-2645 Mike Stone E-mail:[email protected] MANAGING ENGINEER: Rick Roberts, I! E. Sandra Squire, Executive Secretary Public Service Commission of WV 201 Brooks St., P.O. Box 812 Charleston, WV 25323 Re: Logan County Public Service District Holden Water Company Acquisition Dear Ms. Squire: Pursuant to WV Code 24-2-1 1, the Logan County Public Service District is submitting the following information and requesting a Certificate of Convenience and Necessity for the referenced acquisition: 1. Original and twelve (12) copies of this cover letter 2. Original and twelve (12) copies of PSC Form 6 3. Thirteen (1 3) copies of the Accounting Exhibit 4. Thirteen (1 3) copies of the Purchase Agreement 5. Thirteen (1 3) copies of the Project Report If you have any questions or need additional information, do not hesitate to call or write. Sincerely, 'ue Rick Roberts, P.E. Managing Engineer LOGAN COUNTY PSD CRR:mjg Enclosures: as stated Form No. 6 FORM OF PETITION FOR PURCHASE, LEASE OR OTHERWISE ACQUIRING CONTROL OF ONE PUBLIC UTILITY BY ANOTHER PUBLIC UTILITY State of West Virginia Public Service Commission Charleston Case No. Petition of Logan County Public Service District for the consent and approval to the purchase of the assets of the Holden Water Company. Comes now the above-named Logan County Public Service District, petitioner herein and respectfully shows the Commission as follows: 1. That the name and address of the petitioner are Logan County Public Service District, P.O. Box 506, Logan, WV 25601. 2. That the name and address of the utility whose property, etc., is sought to be acquired are Holden Water Company, Drawer A, Holden, WV 25625. 3. That the financial condition of the petitioner and of the utility whose property, etc., is sought to be acquired is detailed in the attached Accounting Exhibit. 4. That the petitioner desires to purchase the assets of the Holden Water Company at Holden and surrounding areas of Logan County, West Virginia, as follows: Treatment plant, distribution facilities, materials stored, maintenance equipment, tools, etc. 5. The terms and conditions of the sale are detailed in the attached Agreement. 6. The proposed transaction will have the effect of improving the water quality and quantity of the Holden Water System customers. It will increase the rates charged to the Holden customers by approximately 30 percent. The District will benefit through economies of scale from the added customer base. 7. The method of financing for the proposed transaction is a State Grant of $500,000. 8. No utilities other than Logan County Public Service District and the Holden Water Company will be affected by the proposed transaction. 9. The Logan County Public Service District prays that the petition be granted to improve the quality of water service provided to the Holden Water Company customers. Dated this 26th day- of May, 2006-. - Signature of authori-zed representative (2f petitioner Mark E. Kauffelt, Attorney. P.O. Box 3082, Charleston, WV 25331-3082 Subscribed and sworn before me this 26th day of May, 2006. h a P - .cia1 2ignature and official seal of notarY VERIFICATION State of West Virginia Public Service Commission Charleston STATE OF WEST VIRGINIA. COUNTY OF LOGAN, ss. I, Rick Roberts, the Managing Engineer of Logan County Public Service District, the Defendant named in the foregoing PETITION, being duly sworn, says that the facts and allegations therein contained are true, except so far as they are therein stated to be on information, and that, so far as they are therein stated to be on information, I believe them to be true, before me this the 26th day of May, 2006. My commission expires on the \ Fk dayof TshK&L ,2007. CERTIFICATE OF SERVICE I, Rick Roberts, Managing Engineer for Logan County Public Service District, hereby certify that the foregoing PETITION was served upon all parties of record by depositing true and exact copies thereof in the United States Mail, First Class postage prepaid, addressed as follows: Charles R. Adkins Holden Water Company Drawer A Holden, WV 25625 Mark E. Kauffelt Kauffelt & Kauffelt P.O. Box 3082 Charleston, WV 2533 1-3082 on this the 26th day of May, 2006. Riik Roberts, P.E., Managing Engineer LOGAN COUNTY PUBLIC SERVICE DISTRICT AGREEMENT THIS AGREEMENT, made and entered into ths 10th day of May, 2006, by and between the LOGAN COUNTY PUBLIC SERVICE DISTRICT, Post Office Box 506, Logan, West Virginia 25601, a public corporation and political subdivision of the State of the State of West Virginia organized and existing pursuant to the provisions of West Virginia Code $ 16-13A-1, et seq. (hereafter ‘‘LCPSD”), and HOLDEN WATER COMPANY, Drawer A, Holden, West Virgmia 25625, a West Virginia utility and corporation with its principal office and place of business at Holden, Logan County, West Virginia 25625 (hereafter “Company”). WHEREAS, Company is the owner and operator of a water treatment, storage and distribution system serving approximately Six Hundred Ninety (690) customers in and around the Holden area of Logan County, West Virgma, (hereafter the ‘Water System”); and, WHEREAS, Company is also the owner of certain inventory and equipment used in conjunction with the operation and maintenance of the Water System; and, WHEREAS, Company is desirous of selling and LCPSD is desirous of buymg the Water System and certain assets udzed by it in connection with the treatment, storage and distribution of potable water to its customers, all as more particularly set 1 forth herein, and all of which is subject to the following terms, limitations and conditions. WITNESSETH: NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and other good and valuable consideration as contained herein, the parties agree as follows 1. Company hereby agrees to transfer, sell and convey to LCPSD, and LCPSD hereby agrees to purchase and acquire from Company, upon the terms and conditions hereinafter set forth, the Water Distribution System, including the following: A. any and all buildings, treatment units, pumps, chemical feed systems, storage tanks, mains, extensions, laterals, valves, hydrants, connections, services, meters, and all other equipment of Company used or useful in the rendition of water service to the customers of the Company in the Holden area of Logan County, together with all easements, rights of way, permits, rights, franchises, certificates of convenience and necessity, and certain other tangible and intangible assets owned or held by Company, and used or useful in the operation of the Water 2 System, such property including but not limited to those assets specifically described on the Exhibits attached hereto and incorporated herein by reference: Exhibit 1 -- General Description of Holden Water System Exhbit 2 -- Tangible and Intangible Personal Property, including Inventory Exhibit 3 -- Real Property, Including Leaseholds, Rights of Way and Other Easements 2. In consideration of all of the aforesaid assets to be conveyed and transferred to LCPSD by Company, pursuant to Paragraph No. 1 herein, LCPSD agrees to pay to Company, and Company agrees to accept from LCPSD, for all items mentioned in Paragraph No. 1, the sum of One Hundred Ninety Thousand Dollars ($190,000.00), less any indebtedness to any creditors as may be disclosed by an examination of the records in the Office of the Clerk of the County Commission of Logan County, West Virginia. Company will be fully responsible for payment of any such indebtedness; however, LCPSD and Company agree that any such sums of indebtedness which are filed of record may be withheld at closing by LCPSD to ensure payment of the same. If there exist any indebtedness of Company on any of the assets to be conveyed to LCPSD, Company agrees to disclose documentation of all such indebtedness and keep current all debt principal and interest payments through the date of closing. 3 3. Company will provide appropriate documentation of interim water collections to LCPSD, and, addtionally, Company agrees to make all accounts receivable records and customer repayment agreements avdable for inspection by LCPSD during normal business hours. 4. Company agrees that it d not purchase any vehicles or equipment or execute any contracts for the Water System without the express written consent of LCPSD after the date of execution of thts Agreement, which consent shall not be unreasonably withheld, except as may be required in the ordinary course of business up to the date of closing or expiration of tlvs agreement, whichever comes first. 5. Company warrants and represents unto LCPSD that all of the assets to be sold and delivered to LCPSD pursuant to the provisions of Paragraph No. 1 herein are located in Logan County, West Virgma. Company agrees that it will not remove or dispose of any of such property without the express written consent of LCPSD, except as may be required in the ordinary course of business up to the date of delivery of possession of the assets to LCPSD. 6. Company further agrees to grant, transfer, convey and assign to LCPSD all warranties, express or implied, relating to the tangible personal property and inventory to be transferred to LCPSD, hereunder, and wiU provide to LCPSD all written documentation of said warranties and guarantees. 4 7. Company warrants and represents to LCPSD as follows: a. Company is a duly organized utdity and corporation, vahdly existing and in good standing under the laws of the State of West Virgma. b. Charles R. Adkins is the duly elected and current President of Company and has the full right, power and authority from said corporation to enter into thrs Agreement on behalf of Company, to sell the assets on behalf of Company, and to execute on behalf of Company any and all other documents as may be necessary to consummate this transaction.