Audit Issue # 8: Allocation of Revenues to Pennichuck Water Service Company Sample Clauses

Audit Issue # 8: Allocation of Revenues to Pennichuck Water Service Company. The Audit Staff found that PWW receives monthly revenues from the City related to the purchase of water consumption data for purposes of the City’s sewer xxxxxxxx. Of the revenues received from the City, 90% is allocated to PWW and 10% is allocated to its affiliate, Pennichuck Water Services Company (PWSC). During the test year, approximately $118,000 was received from the City for PWW’s water consumption data, with approximately $106,000 allocated to PWW and approximately $12,000 allocated to PWSC. However, even though this allocation of revenues had been the Company’s standard practice dating back to the mid-1990s, and accepted by the Commission, there is no longer an apparent reason for the apportionment of any of these revenues to PWSC. However, given 1) the di minimis amount of revenues allocated to PWSC during the test year, and 2) the Commission’s past acceptance of this revenue allocation, the Settling Parties agree and recommend the Commission approve this allocation of revenues relative to the 2018 test year for purposes of calculating PWW’s revenue requirement in the instant rate proceeding. The Settling Parties further agree and recommend that, commencing with the Company’s 2020 operating year and following, any revenues received from the City for the Company’s consumption data should be fully attributed to PWW, only.
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