Nancy Day Moen, Executive Assistant to

Mark Sidran, Chairman

1300 S Evergreen Pk Dr SW

PO Box 47250

Olympia, WA 98504-7250

360-664-1172

Fax 360-664-3604

From: Lee Goodwin [mailto:bonwell_99@yahoo.com]
Sent: Tuesday, August 28, 2007 12:12 AM
To: Ward, Jim (UTC); Sidran, Mark (UTC); Oshie, Patrick (UTC); Jones, Philip (UTC)
Cc: utilities@rosarioresort.com
Subject: Docket UW-070944 Rosario Utilities, staff proposed Decision

Re: Docket UW-070944, Rosario Utilites, Staff Proposed Decision available to us Aug 23, 2007

Dear Mr. Ward,

We appreciate that you have tried hard to find a formula to rebalance usage with revenue. However the proposed new rate design introduces new inequities to our Highlands group of users which are unfair.

The new Usage scale on page 4 of your Recommendations makes no sense to us. You and RU have long catagorized the Highlands as one bulk user, when in fact we are currently 102 individual users. The only real difference between us and all the other users is that we pay Rosario based on gallons usage at the handover meter to us, which happens to be 2" Meter but the only reason it’s 2" while the line into it is 4" pipe and exit pipe from there to our pumps is 4" pipe was because it’s a less costly meter than a 4" one would be. We know that common utility practice is to use 2" meters for commercial customers, such as hotels who need the greater capacity, but that 2" meters are never used for individual residences. We are not a commercial user, nor a hotel. All of our individual user meters are 5/8", similar to RPOA’s 3/4". We believe that the size of our handover billing meter is completely irrelevant, and that the only criteria should be gallons used. Attempting to charge us for a theoretic process that doesn’t exist is not only unreasonable, it misrepresents facts and borders on fraud.

We cannot understand why the new rate "block" of "Over 18,000 ga", since no individual user consumes anywhere near 18,000 ga/mo.

Your proposed rates (from your file labeled "Cover Sheet") show the following:

RPOA (Residents):

Based on aver 3942 ga/mo/user

Base rate $22.91 x 183 users    = $4,011

Block 1: 502,466 ga x .83/100ga = 4,170    = 69.7% of usage at $.83

Block 2: 146,040 ga x 1.56 =         2,278    = 20.2% of usage at 1.56

Block 3: 72,911 ga =                     1,363    = 10.1% of usage at 1.87

Total 721,417ga                         $11,822 divided by 183 users = $ 64.60/user

"Old Rate" (as stated by UTC): $ 39.85/user = 62% increase

Total Revenue $141,822 vs 2006 actual $91,807 = 54.5% increase

Highlands:

Based on 4000 ga/mo/user

Base Rate:                            $219.20 for "2"Meter customer"

Block 1: 60,000ga x .83 =        498            = 14.7% of usage at $.83

Block 2: 117,110ga x 1.56 =  1,827            = 28.7% of usage at 1.56

Block 3: 230,694ga x 1.87 =  4,314            = 56.5% of usage at 1.87

Totals    407,804ga              $6,858 divided by 102 users = $67.24/user + 22.25 distribution  

                                                                                  costs = total $89.49 delivered cost

Old rate: $39.85 less 4.75 discount = 35.10    =            91.6% increase

Total Revenue $82,297 vs. Normalized '06 Rev $42,840 = 92% increase

There is no justification why Highlands should face 37% more increase than our neighbor Residents, or why our "block" scale should result in 56% of consumption billed at the highest possible bracket when only 10% of theirs is. The reason for the former is you’ve eliminated our $4.75 "bulk" discount that’s been in place for years. You’ve also ignored our June 2 request that our discount should be amended to $20.00, to more closely compensate for our extra distribution costs which none of the other users pay since their

distribution is included in the rates, so that our delivered cost could be on a parity, as it should be.

We strongly believe all residential users should pay the same Usage rates, since we are all equal customers. One group should not be discriminated against compared to like groups. Ignoring the fact that Highlands must pay for it’s own distribution costs, plus paying equally for the cost of maintaining all the distribution piping, valves etc in the Resident/Resort area that does not benefit us, is simply wrong and unreasonable. We know that the piping in Resident/Resort area is in need of replacement soon, that since it’s very deeply buried that the cost will be very high, and that we’ll undoubtedly be forced to pay for that along with all other users even though it doesn’t benefit us. Why do we own and are responsible for our own distribution system? Only because it was forced upon us about 25 years ago by the Rosario owners at the time who wanted to duck responsibility. They did the same thing with Vusario which is much further distance than we are, but later Rosario took back responsibility for that system. Our system is no further away from handover point than most

of the Resident and Resort units are, so distance we believe is not a valid factor.

Orcas Highlands users believe the proposed rates are unfair and inequitable, and that putting a completely new structure into effect Sept 1 without recognizing our reasonable need for some form of discount, with only 5 days notice prior to the Hearing is unreasonable.

Very truly yours,

Lee B. Goodwin, on behalf of Orcas Highlands Board of Directors