DOCKET UW-980231  Page 1
 
BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION

In the Matter of the Application of )
South Sound Utilities, Inc., and )
American Water Resources, Inc., ) DOCKET UW-980231
for an Order Authorizing the  )
Sale and Transfer of Sky Acres ) ORDER GRANTING 
water system.  ) APPLICATION
   )
 )

  On February 23, 1998, South Sound Utilities, Inc., (South Sound) and American 
Water Resources, Inc., (American Water) filed an application pursuant to the 
provisions of chapter 80.12 RCW for the sale and transfer of Sky Acres water 
system.  Sky Acres water system is located near McCleary and serves four (4) 
customers.  South Sound is regulated by this Commission and serves 
approximately 2,200 customers in three (3) counties.  American Water is 
regulated by this Commission and serves approximately 1,900 customers in seven 
(7) counties.

  The customers of Sky Acres were originally notified of this proposed sale and 
transfer February 23, 1998.  American Water will additionally notify customers 
of the new rates will the next billing cycle to these customers.  The purchase 
price of all of the assets of the Sky Acres water system is $401.85.  The sale 
price is based on the net book cost of the system’s historical cost.

  The benefits of this sale and transfer include the ability of American Water 
to provide frequent visits to the system, since the company has three other 
water systems located in Grays Harbor county.

  Under a separate filing, American Water anticipates filing to add Sky Acres' 
customers to its currently approved tariff in all respects after the transfer.  
That application of tariff will allow the Sky Acres customers to receive a rate 
decrease based on meter rates and increases of ancillary charges if incurred.  
With the new rate design of zero allowance and monthly billing, the customers 
will be charged for only the water they use and on a more timely basis to 
encourage conservation.

Monthly Rates     South Sound American Water
First 400 cubic feet, or less   $ 21.40       --
Basic rate - zero allowance         --   $ 17.70
Per 100 cubic feet or fraction thereof      1.19      1.10
Safe Drinking Water Act Surcharge      1.00       --
Capital Improvement Surcharge         .80       --

Average 1,000 cubic feet    $ 30.34  $ 28.70

Ancillary Charges    South Sound American Water

Disconnect Visit    $ 10.00  $ 20.00
Reconnection Charge      20.00     30.00
NSF Check Charge      10.00     20.00
Late Fee (> 15 days)   None        3.00
Service Visit     None      30.00
Fire Flow (business)   None   $6/1,000 Square Feet
Billing Cycle     Bi-Monthly  Monthly

  This Commission neither approves nor disapproves the reasonableness of any 
fees, charges, rates, or accounting allocations involved with the proposed 
arrangement and reserves the right to review those fees, charges, rates, or 
accounting allocations in a future rate proceeding.

FINDINGS

  THE COMMISSION FINDS:

  1. South Sound Utilities, Inc., and American Water Resources, Inc., are 
Washington businesses operated as public service companies subject to the 
jurisdiction of this Commission under the provisions of chapter 80.12 RCW.

  2. As to form, the application herein, meets the requirements of chapter 
80.12 RCW and the rules and regulations of the Commission adopted pursuant 
thereto.

  3. It appears, upon investigation, that the application for sale and transfer 
is reasonable and consistent with the public interest and should therefore be 
approved.

O R D E R

  THE COMMISSION ORDERS:

  1. Subject to the conditions of this order, South Sound Utilities, Inc., is 
hereby authorized to sell the Sky Acres water system and American Water 
Resources, Inc., is authorized to purchase the Sky Acres water system pursuant 
to the application of sale and transfer filed with the Commission February 23, 
1998.

  2. No material change, revision, or amendment to the application and 
agreement shall become effective without the Commission's prior written 
approval.

  3. American Water Resources, Inc., shall file with the Commission within 60 
days after this effective date of this order, for its prior written approval, 
the journal entries by which they propose to record on their books the sale and 
transfer authorized herein.

  4. The reasonableness of any fees, charges, rates, or accounting allocations 
involved in carrying out the provisions of ordering paragraph no. 1 of this 
order are neither approved nor disapproved in this proceeding.

  5. This order shall in no way affect the authority of this Commission over 
rates, services, accounts, evaluations, estimates, or determination of cost or 
any matters whatsoever that may come before it, nor shall anything herein be 
construed as an acquiescence in any estimate or determination of cost or any 
valuation of property claimed or asserted.

  DATED at Olympia, Washington, and effective this 26th day of 
February, 1999.

  WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION




      MARILYN SHOWALTER, Chairwoman




      RICHARD HEMSTAD, Commissioner




      WILLIAM R. GILLIS, Commissioner