Opinion ID: 2355085
Heading Depth: 3
Heading Rank: 4

Heading: Wiscasset treatment plant

Text: Using a 1982 test year, the Commission adjusted the rate base of the Wiscasset division to include some additions made in 1983 to the Wiscasset treatment plant. [10] The Town argues that this inclusion in rate base was improper because, according to the testimony of a substantial number of Wiscasset residents, no observable improvement in Wiscasset water resulted from those additions. On the other hand, the Commission chose to credit objective scientific testing indicating some improvement in the water as a product of those additions. Although the 1983 additions were but a part of a larger improvement planned for the treatment facility, the Commission acted within the proper scope of its discretion in finding that those additions, by themselves, were sufficiently useful and separable to warrant their recovery prior to the completion of the whole project. The Commission also was justified in finding that despite the use of those additions only during the summertime, they were nonetheless property of the public utility used or required to be used in its service to the public. 35 M.R.S.A. § 52 (1978). Finally, there was no error in the Commission's inclusion of those additions in the 1982 test year rate base even though they were not put into service until 1983. The general rule that the test year rate base should only include property providing service during that year, see New England Telephone & Telegraph Co., 448 A.2d at 294, may be relaxed to reflect subsequent known changes that [are] certain to alter significantly the assumed balance among revenues, expenses and plant. New England Telephone & Telegraph Co., 470 A.2d at 775. In the case at bar, the treatment plant additions did not produce additional revenue; the cost savings resulting from the 1983 additions were quantified and the test year expenses adjusted downward accordingly; and the additions, constituting about 25% of the Wiscasset division's rate base, were not a part of any routine, regularly recurring maintenance program. Thus, the Commission had sound basis for concluding that the treatment plant additions were too significant to ignore and that they could be included in the test year figures without impermissibly distorting the relationship among revenues, expenses, and rate base.