HK – Florida Public Service Commission transcript – Fees and Expenses

In 1 on December 30, 2008 at 12:59 am


         1        Q    And can you share that with us? 

         2        A    Yes.  I've examined the legal bills, the consultants' 

         3   bills and in-house charges from Aqua Services associated with 

         4   rate case expense. 

         5             I am recommending that the Commission disallow rate 

         6   case expense associated with billings from the Rutledge, Ecenia 

         7   Law Firm that were related to the last rate case.  There's 

         8   $40,000 worth of expenses associated with the 2006 rate case 

         9   that were included in the legal expenses.  I'm also 

        10   recommending that legal expenses associated with the refund 

        11   reports associated with the last rate case be disallowed. 

        12             I'm recommending that expenses associated with the 

        13   townhall meetings be disallowed.  I'm also recommending that 

        14   legal expenses associated with Mr. Rendell's — the lawyers 

        15   spent a lot of time examining the ethical issues associated 

        16   with Mr. Rendell's employment, and I'm recommending that those 

        17   expenses be disallowed. 

        18             I'm recommending that the law firm, Holland

        19   Knight's expenses associated with Lake Suzy matters be 

        20   disallowed.  They spent approximately $8,000, $9,000 on Lake 

        21   Suzy issues associated with the fact — as I understand it from 

        22   reading the legal bills, that particular system was owned by a 

        23   Texas company and there were some concerns apparently about how 

        24   that particular system could be a part of this rate case.  And 

        25   if you look at that legal bill, it's not even associated with 

                            FLORIDA PUBLIC SERVICE COMMISSION 


         1   the rate case.  It's an entirely different bill.  It has a 

         2   different in re in terms of what they're billing for. 

         3             In addition, on that particular bill, on those 

         4   particular bills Mr. May charged, I believe it was $460 an 

         5   hour; whereas, in the rate case he's charging $365. 

         6             I'm also recommending that legal expenses associated 

         7   with certain discovery matters be disallowed.  The company at 

         8   some point during the process changed their protocol in terms 

         9   of responding to OPC discovery.  And rather than providing us 

        10   with information electronically, they kept the information at 

        11   Holland & Knight and required that OPC come and examine those 

        12   documents.  In order for OPC to do that, the company had to 

        13   print the documents rather than provide that information 

        14   electronically, and I don't believe it's appropriate that the 

        15   ratepayers should pay for that added expense. 

        16             In addition, on the legal bills for Holland & Knight 

        17   there were charges associated with the return on equity 

        18   leverage proceeding.  At one point in time it appears from 

        19   reading the legal bills that they were thinking about 

        20   intervening in that docket.  They did not intervene in that 

        21   docket, so I'm recommending that those expenses be disallowed. 

        22   They're not associated with this rate case. 

        23             I'm also recommending that expenses from the law firm 

        24   be disallowed associated with the time to respond to the staff 

        25   deficiencies.  I'm also recommending that expenses be 

                            FLORIDA PUBLIC SERVICE COMMISSION 


         1   disallowed associated with the substitution of witnesses, 

         2   particularly with the one witness Mr. Rendell.  His testimony 

         3   was taken over by Mr. Smeltzer and there are legal fees 

         4   associated with that. 

         5             I'm also recommending that the consulting fees be 

         6   disallowed for the deficiencies, and there's quite a bit of 

         7   expense there.  And then I'm also recommending that $67,000 be 

         8   disallowed associated with AUS Consultants' fees.  In the last 

         9   rate case the — that particular firm did the billing analysis 

        10   in this proceeding, and in the last case those functions were 

        11   performed by more or less in-house individuals.  And so I'm 

        12   recommending that the difference in the hourly rate between 

        13   what was charged by AUS Consultants and the charge of the 

        14   individuals that are, they're in-house — some are in-house but 

        15   others are consultants that primarily work for the company that 

        16   are charging $100 an hour.  So what I've done is substituted 

        17   the $100 an hour for his time. 

        18        Q    Do you have any additional comments? 

        19        A    I'm just trying to make sure I've covered it all. 

        20        Q    Okay.

Posted via email from HKLaw Investigation


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