The County of Delaware v. PA PUC

CourtCommonwealth Court of Pennsylvania
DecidedSeptember 12, 2022
Docket455 C.D. 2021
StatusUnpublished

This text of The County of Delaware v. PA PUC (The County of Delaware v. PA PUC) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
The County of Delaware v. PA PUC, (Pa. Ct. App. 2022).

Opinion

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

The County of Delaware, : Petitioner : : No. 455 C.D. 2021 v. : : Submitted: June 23, 2022 Pennsylvania Public Utility : Commission, : Respondent :

BEFORE: HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE ANNE E. COVEY, Judge HONORABLE LORI A. DUMAS, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION BY JUDGE McCULLOUGH FILED: September 12, 2022

The County of Delaware, Pennsylvania (Petitioner) petitions for review of the March 30, 2021 Opinion and Order of the Pennsylvania Public Utility Commission (Commission), which (1) vacated the Recommended Decision of the Administrative Law Judge (ALJ) to deny the Application of Aqua Pennsylvania Wastewater, Inc. (Aqua), (Application), seeking approval to acquire the assets of the Delaware County Regional Water Quality Control Authority (DELCORA); (2) reopened the record; and (3) remanded the matter to the Office of Administrative Law Judge (OALJ) for further proceedings and a recommended decision evaluating and recommending the disposition of the Application based on new developments in the case after the close of the evidentiary record. Upon review, we quash the petition for review. I. History of the Proceeding This matter concerns Aqua’s Application filed on March 3, 2020, pursuant to sections 1102,1 13292 and 507 of the Public Utility Code (Code), 66 Pa. C.S. §§1102, 1329 and 507, seeking Commission approval to acquire DELCORA’s wastewater assets for $ 276.5 million. In its Application, Aqua requested the issuance of an Order and Certificates of Public Convenience for the approval of: (1) the acquisition by Aqua of DELCORA’s wastewater system assets situated within all or part of 49 municipalities within portions of Chester and Delaware Counties; (2) the right of Aqua to begin to offer, render, furnish and supply wastewater service to the public in portions of Delaware and Chester Counties; and (3) the assignment of 163 DELCORA contracts to Aqua. (Reproduced Record (R.R.) at 42a-62a.) The Application contained testimony describing what the seller, DELCORA, was planning to do with the majority

1 Section 1102 of the Code, 66 Pa.C.S. §1102, governs the Commission’s general review of a public utility’s request to acquire new assets. 2 Section 1329(c) of the Code, 66 Pa.C.S. §1329(c), addresses the issue of the Commission’s determination of the rate base value for assets acquired that will later be added to the rate base of the acquiring utility for ratemaking purposes. Section 1329(d)(1) specifies the materials and information to be included in a Section 1329 application filing, including “a rate stabilization plan, if applicable to the acquisition.” 66 Pa.C.S. 1329(d)(1). Section 1329(d)(2) provides that “[t]he Commission shall issue a final order on an application submitted under this section within six months of the filing date of an application meeting the requirements of subsection (d)(1).” 66 P.S. 1329(d)(2). After enactment of Section 1329, the Commission entered an Implementation Order, which in part, elaborated on the six-month deadline:

[W]e emphasize that the Commission’s proposed model timeline was only a guideline for achieving a Commission final order within the six- month deadline. . . . We would expect the proposed modifications to recognize the requirements of due process in a particular proceeding and, at the same time, be tailored to the development of a full and complete record for the Commission’s review.

Implementation of Section 1329 of the Public Utility Code, PUC Docket No. M-20162543193 (Order Entered October 27, 2016) at 35.

2 of the transaction proceeds. DELCORA’s plan was to place the transaction proceeds into an irrevocable trust dedicated to providing payments to customers to assist with future bills. Aqua explained in its Application that as the buying utility, its tariff would charge cost of service rates and further explained why a rate stabilization plan, as defined in section 1329(g) of the Code, was unnecessary. On May 14, 2020, Petitioner filed a complaint against DELCORA and the DELCORA Rate Stabilization Trust in the Court of Common Pleas of Delaware County (common pleas court) at Docket CV-2020-003185, asserting that DELCORA’s creation of a trust in connection with the proposed transaction violated DELCORA’s Articles of Incorporation, was ultra vires, and violated the Municipality Authorities Act, 53 Pa.C.S. §§5601-5623 (R.R. at 105a-106a.) On May 18, 2020, Petitioner filed a petition to intervene in the Application proceeding before the Commission, claiming that Aqua’s Application was not in the public interest and that the DELCORA Rate Stabilization Trust Agreement and related agreements associated with the Application violate applicable law. By Secretarial Letter dated June 11, 2020, the Commission’s Bureau of Technical Utility Services notified Aqua of the conditional acceptance of the Application for filing and directed Aqua to (1) provide notice of the filing of the Application; (2) amend its Application to include certain supplemental materials; and (3) ensure verification of the supplemental materials. (R.R. at 197a.) On June 23, 2020, Petitioner sought reconsideration (Reconsideration Petition) and rescission of the June 11, 2020 Secretarial Letter and reissuance of a new Secretarial Letter requiring Aqua to attach a rate stabilization plan to its Application. (R.R. at 198a.) On July 9, 2020, Aqua filed an answer to the Reconsideration Petition

3 arguing that section 1329 of the Code did not require submission of a rate stabilization plan given the relationship between Aqua’s Commission-determined rates and DELCORA’s proposed use of transaction proceeds through a trust. (R.R. at 198a.) By Secretarial Letter dated July 14, 2020, the Commission notified the parties that the docket was inactive but, if Aqua satisfied all of the conditions in the June 11, 2020 Secretarial Letter, and the docket became active as a result of that satisfaction, the Reconsideration Petition, and any responsive filings, would be accepted into the docket and assigned for formal action and disposition. (R.R. at 198a.) On July 15, 2020, Petitioner filed an amendment to its Reconsideration Petition (Amended Reconsideration Petition) averring “new and additional information concerning developments in a civil court proceeding that arose after Petitioner filed its [Reconsideration] Petition.” (R.R. at 198a.) Specifically, the civil court proceeding was a reference to the complaint Petitioner filed against DELCORA in the common pleas court. Petitioner argued that the Commission’s deferral of disposition of its Reconsideration Petition until after the Application was accepted for filing would violate Petitioner’s due process right to challenge the Commission’s determination. On July 23, 2020, Aqua filed a letter confirming completion and satisfaction of the notice requirements and conditions set forth in the June 2020 Secretarial Letter and requesting that the Commission finally accept its Application. (R.R. at 199a.) By Secretarial letter dated July 27, 2020, the Commission acknowledged Aqua’s completion of the requirements and conditions of filing and accepted Aqua’s Application for consideration. (R.R. at 199a.) On August 7, 2020, Petitioner filed with the Commission a petition for stay, arguing that the disputed issues in the proceeding it initiated before the common

4 pleas court at Docket No. CV-2020-003185 must be resolved prior to the Commission’s adjudication of the Application.

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The County of Delaware v. PA PUC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/the-county-of-delaware-v-pa-puc-pacommwct-2022.