Florida Public Service Commission native order document 01966-2024

FILED 4/17/2024
DOCUMENT NO. 01966-2024
FPSC - COMMISSION CLERK
BEFORE THE FLORIDA PUBLIC SERVICE COMMISSION
In re: Application for staff-assisted rate case in
Polk County by Pinecrest Utilities, LLC.
DOCKET NO. 20230071-WU
-----------------~
ORDER NO. PSC-2024-0100-PAA-WU
ISSUED: April 17, 2024
The following Commissioners participated in the disposition of this matter:
MIKE LA ROSA, Chairman
ARTGRAHAM
GARY F. CLARK
ANDREW GILES FAY
NOTICE OF PROPOSED AGENCY ACTION ORDER
APPROVING RATE INCREASE FOR PINECREST UTILITIES, LLC.
BY THE COMMISSION:
NOTICE is hereby given by the Florida Public Service Commission (Commission) that
the actions discussed herein, except for (1) the reduction of rates after four years based upon the
recovery of rate case expense, (2) the granting of temporary rates in the event of protest, and (3)
the requirement for proof of adjustment of books a nd records, are preliminary in nature and will
become final unless a person whose interests are substantially affected files a petition for a
formal proceeding, pursuant to Rule 25-22.029, Florida Administrative Code (F.A.C.). The
reduction of rates after four years, the granting of temporary rates in the event of protest, and the
requirement for proof of adjustment of books and records are procedural agency actions a nd
subject to reconsideration and appeal as described below under the he ading, "NOTICE OF
FURTHER PROCEEDINGS OR JUDICIAL REVIEW."
Case Background
Pinecrest 	Utilities, 	LLC 	(Pinecrest 	or Utility) 	is 	a 	Class 	C 	water 	utility 	serving
approximately 138 residential customers in Polk County. The Utility was transferred to the
present operator in 2012. 1 Pinecrest's rates and charges were approved in its last staff-assisted
rate case (SARC) in 2013.2 According to the Utility's 2022 Annual Report, total gross revenue
was $59, 184 and total operating expense was $82,431.
'Ord er No. PSC-2012-0475-PAA-WU, issued on September 18, 2012, in Docket No. 2011031 I-WU, In re:
Application for transfer of Certificate No. 588-W from Pinecrest Ranch es, Inc., in Polk County, to Pinecrest
Utilities, LLC.
2 OrderNo. PSC-2013-0320-PAA-WU, issued on July 12 , 2013, in Docket No. 20120269-WU, In re: Application for
a staff-assist ed rate case in Polk County by Pinecrest Utilities, LLC.

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On May 26, 2023, the Utility filed its application for a SARC. 3 A test year ended
December 31, 2022, was selected for the purposes of interim and final rates. We approved an
interim rate increase of $10,772 (18.20 percent) for the Utility on July 17, 2023.4
A customer meeting was held on January 23, 2024, in which one customer provided
comments.
We have jurisdiction in this case pursuant to Sections 367.011, 367.081, 367.0812,
367.0814, 367.091, and 367.121, Florida Statutes (F.S.).
Review and Decision
1. Quality of Service
Pursuant to Section 367.081(2)(a)1, F.S., and Rule 25-30.433(1), Florida Administrative
Code (F.A.C.), in water rate cases, we shall determine the overall quality of service provided by
a utility. This determination is made from an evaluation of the quality of a utility’s product and a
utility’s attempt to address customer satisfaction. The Rule further states that the most recent
chemical analyses for the water system, outstanding citations, violations, and consent orders on
file with the DEP and the county health department, and any DEP and county health department
official’s testimony concerning quality of service shall be considered. In addition, any customer
testimony, comments, or complaints received by us are also reviewed. The operating condition of
the water system is addressed in Section 2.
A. Quality of Utility’s Product
In evaluation of Pinecrest’s product quality, we reviewed the Utility’s compliance with
the DEP’s primary and secondary drinking water standards. Primary standards protect public
health while secondary standards regulate contaminants that may impact the taste, odor, and
color of drinking water. In the DEP’s last Sanitary Survey Report dated March 20, 2023, no
chemical or bacteriological exceedances were noted, and the Utility was determined to be in
compliance with DEP standards. We also reviewed the DEP’s triennial Safe Drinking Water
Program chemical analysis of samples taken at the point of entry on June 14, 2021, and while the
Utility was determined to be in compliance by the DEP, we observed an exceedance in iron. In
response to our Second Data Request, 5 the Utility explained that this exceedance was due to iron
being a part of the ground water makeup at the well. As a result, the Utility treats the water with
Aqua Mag, which is used for iron sequestration. In addition, in response to our Seventh Data
Request, the Utility indicated that water testing for compliance with the DEP’s water quality
standards will be completed again this year.6
3Document No. 03388-2023, filed on May 26, 2023.
4Order No. PSC-2023-0199-PCO-WU, issued on July 17, 2023, in Docket No. 20230071-WU, In re: Application for
staff-assisted rate case in Polk County by Pinecrest Utilities, LLC.
5Document No. 05912-2023, filed on November 1, 2023.
6Document No. 00695-2024, filed on February 13, 2024.

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B. The Utility’s Attempt to Address Customer Satisfaction
We reviewed the Commission’s Consumer Activity Tracking System (CATS) records,
and discovered only one complaint recorded during the test year and four years prior for
Pinecrest. The complaint was received September 21, 2022, and was regarding improper
disconnection due to a water shutoff. The Utility responded timely that the event was due to
planned maintenance and the complaint was then closed. We also requested all complaints
received by the DEP during the test year and four years prior. The DEP responded that it did not
receive any complaints for Pinecrest during this timeframe.
We performed a supplemental review of the complaints filed in CATS during the course
of this docket, and one additional complaint was submitted on January 17, 2024. The complaint
expressed concerns regarding the rate increase, water color, and poor customer service. The
Utility responded with flushing the water line but had difficulties contacting the customer, and
was advised by us to provide a written response, which addressed the need for flushing of
customer faucets after vacant periods. The complaint has been closed. We also requested any
customer complaints received by the DEP during the course of this docket. The DEP responded
that it did not receive any complaints for Pinecrest during this timeframe.
We requested all complaints received by Pinecrest during the test year and four years
prior, and the Utility provided 21 complaints received during this timeframe, one of which was
duplicative of the initial complaint received through the CATS. The majority of the complaints
received by the Utility were during 2020. The Utility appears to have been responsive and
resolved concerns in a timely manner. Table 1 shows these complaints, as well as the comments
and complaints received during the course of this docket, by source and subject.
Table 0
Number of Comments and Complaints by Source and Subject
Subject of 	Utility 	CATS 	Written/Oral
Complaint 	Complaints 	Complaints 	Comments 	Total*
Leaking Water Meters 	4 	0 	0 	4
Service Interruptions 	5 	2 	3 	10
Billing 	5 	0 	0 	5
Water Odor 	4 	0 	0 	4
Noise 	2 	0 	0 	2
Water Color 	1 	1 	2 	4
Improper Disconnection 	1 	0 	0 	1
Poor Customer Service 	0 	1 	1 	2
General Water Quality Concerns 	0 	0 	1 	1
Rate Increase Concerns 	0 	1 	4 	5
Total* 	22 	5 	11 	38
*A single customer comment/complaint may be counted multiple times if it is associated with multiple categories.
A virtual customer meeting was held on January 23, 2024, and one customer provided
oral comments. This customer also submitted the most recent CATS complaint and written

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DOCKET NO. 20230071-WU
PAGE 4
comments 	to 	the 	docket 	file, 	and 	expressed 	concerns 	regarding 	the 	rate 	increase 	and
discoloration, noting they installed a private water filtration system. Three additional written
customer comments were submitted following issuance of the customer meeting notice or
following the customer meeting. These addressed opposition to rate increases, frequency of
interruptions due to repairs and resulting boiled water notices, water discoloration, and that the
water 	was 	not 	suitable 	for 	consumption 	and 	caused 	skin 	reactions. 	One 	comment 	also
complimented Utility staff’s customer service.
We note the concerns regarding secondary water quality, specifically odor and color, and
service interruptions have been addressed by the Utility. Regarding water color, as discussed
previously, we note that the Utility had an iron exceedance when it was last tested due to it
naturally occurring in the ground water, and the Utility has responded by treating the water with
Aqua Mag, and flushing customers’ water lines in response to complaints to address this issue.
Regarding water odor, the Utility tested the water for compliance in response to complaints.
Regarding the interruptions, in response to our Seventh Data Request, the Utility identified a
total of eight service interruptions for the test year (January 1, 2022, through December 31,
2022). 7 These interruptions were a result of either line breaks, loss of power at the water
treatment plant, loss of pressure on the system as a result of a power outage, tank inspection and
cleaning, emergency repairs, or leaks. The Utility issued boil water notices for each interruption,
and lifted them when safe to do so.
C. Conclusion
Pinecrest has been responsive to customer complaints and is currently in compliance with
DEP standards; therefore, we find that the quality of service be considered satisfactory.
2. Infrastructure and Operating Conditions
Rule 25-30.225(2), F.A.C., requires each water utility to maintain and operate its plant
and facilities by employing qualified operators, in accordance with the rules of the DEP. Rule
25-30.433(2), 	F.A.C., 	requires 	consideration 	of 	whether 	the 	infrastructure 	and 	operating
conditions of the plant and facilities are in compliance with Rule 25-30.225, F.A.C. In making
this determination, the Commission must consider testimony of the DEP and county health
department officials, sanitary surveys for water systems, citations, violations, and consent orders
issued to the utility, customer testimony, comments, and complaints, and utility testimony and
responses to the aforementioned items.
A. Water System Operating Conditions
Pinecrest’s water system has a permitted capacity of 150,000 gallons per day (gpd). The
water system has two wells with pumping capacities of 200 gallons per minute (gpm) and 90
gpm, respectively, and one hydropneumatic storage tank with a capacity of 5,000 gallons.
7Document No. 00695-2024, filed on February 13, 2024.

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Groundwater from the wells is treated through hypochlorination. We reviewed Pinecrest’s most
recent Sanitary Survey Report conducted by the DEP to determine the Utility’s overall water
facility compliance. A review of the Report dated March 20, 2023, indicated that Pinecrest’s
water treatment facility is in compliance with the DEP’s rules and regulations.
B. Conclusion
Pinecrest’s water treatment facility is currently in compliance with DEP regulations.
3. Used and Useful
As stated in Section 2, Pinecrest’s water system has two wells with pumping capacities of
200 gpm and 90 gpm, respectively, and one hydropneumatic storage tank with a capacity of
5,000 gallons. Pinecrest’s water distribution system is composed of 500 feet of 2-inch polyvinyl
chloride (PVC) pipe, 6,300 feet of 3-inch PVC pipe, 3,210 feet of 4-inch PVC pipe, 5,025 feet of
6-inch PVC pipe, and 20 feet of 4-inch galvanized pipe. There are nine fire hydrants throughout
the water distribution system.
A. Used and Useful Percentages
Rule 25-30.4325, F.A.C., addresses the method by which the U&U of a water system is
determined. In its last SARC, Pinecrest’s WTP and water distribution system were found to be
100 percent U&U. 8 The Utility has not increased the capacity of its WTP since rates were last
established. The Utility’s water distribution system continues to only provide service to existing
customers, the service area remains built out, and there continues to be no potential for
expansion of the service area. Therefore, consistent with the Commission’s previous decision,
we find that the Utility’s WTP and water distribution system be considered 100 percent U&U.
B. Excessive Unaccounted for Water
Rule 25-30.4325, F.A.C., additionally provides factors to be considered in determining
whether adjustments to operating expenses are necessary for EUW. EUW is defined as
“unaccounted for water in excess of 10 percent of the amount produced.” Unaccounted for water
is all water produced that is not sold, metered, or accounted for in the records of the utility.
EUW is calculated by subtracting both the gallons sold to customers and the gallons used
for other services, such as flushing, from the total gallons pumped and purchased for the test
year, and dividing by the sum of gallons pumped and purchased. The amount in excess of 10
percent, if any, is the EUW percentage.
Based on monthly operating reports, Pinecrest produced 12,493,332 gallons of water
during the test year (January 1, 2022, through December 31, 2022). We were able to verify the
Utility sold 5,110,602 gallons of water to customers. In its 2022 Annual Report, the Utility
8Order No. PSC-2013-0320-PAA-WU, issued on July 12, 2013, in Docket No. 20120269-WU, In re: Application for
staff-assisted rate case in Polk County by Pinecrest Utilities, LLC.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 6
reported that no water was purchased, and recorded 7,383,000 gallons of water loss from line
flushing and other events during the test year. This calculation results in approximately zero
unaccounted for water. However, upon our review, it appeared that the accounted for loss value
was determined by taking the difference between gallons of water produced and gallons of water
sold in each month of the Utility’s 2022 Annual Report, including a negative value for one
month. As such, we requested that the Utility provide documentation supporting the values
provided in the Utility’s 2022 Annual Report for water loss due to flushing and other events.
In response to our Fourth Data Request regarding the methodology used to determine the
values in the 2022 Annual Report, the Utility stated that the flushing valves were unmetered, but
that the Utility’s technician calculated a flushing value based on line diameter and flush
duration.9 In response to our Fifth Data Request asking for supporting documentation for those
values, the Utility responded it did not keep exact records and outlined its routine flushing
events, but noted additional flushing occurs based on operating conditions, customer complaints,
and other factors.10
In response to our Seventh Data Request, the Utility stated it is under no mandate from
the DEP to engage in additional flushing beyond routine maintenance or in response to customer
complaints.11 We also asked if any non-flushing values were included in the reported values,
which the Utility responded it also included water loss from leaks in the value. In the Utility’s
supplemental response to our Seventh Data Request, and its response to our Ninth Data Request,
the Utility provided estimates of water loss due to routine flushing and maintenance events, and
several known water leak events that resulted in water loss.12 We therefore elected to use the
estimates provided by the Utility to determine water loss resulting from flushing and other events
for the test year, rather than the 2022 Annual Report values.
For its calculation of EUW, we excluded August and September 2022 as the Utility
indicated that its flow meter had failed during these months, which resulted in low or no flow
data being recorded for portions of these months.13 The resulting calculation ([11,408,332 + 0 –
4,330,749 – 511,378] / [11,408,332 + 0]) for unaccounted for water is 57.6 percent. Therefore,
there is 47.6 percent EUW.
Pursuant to Rule 25-30.4325(10), F.A.C., we reviewed all relevant factors for the EUW
value, including whether the reason for losses was known, and whether a solution has been
implemented or is economically feasible. For example, the Utility’s estimates of major leaks may
be subject to error due to unknown duration of the leak before it was detected and able to be
repaired by the Utility. However, in reviewing the monthly values between those months with
large leaks reported and those without, we did not determine any large difference in unaccounted
for water. In response to our Ninth Data Request, the Utility did not state it had identified a
source for the losses, but speculated that the water meters may be faulty, noting that after the
9Document No. 06652-2023, filed on December 18, 2023.
10 Document No. 00267-2024, filed on January 22, 2024.
11 Document No. 00695-2024, filed on February 13, 2024.
12 Document Nos. 00757-2024, filed on February 19, 2024; and 00913-2024, filed on February 26, 2024.
13 Document No. 05912-2023, filed on November 1, 2023.

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flow meter failed in late 2022, the Utility conducted bucket tests on random customer meters,
and determined that there was an increasing number of dead meters throughout the system. 14 We
acknowledge that faulty water meters could contribute towards the value, but the magnitude of
the error made it unlikely to be the sole source. We reviewed the Utility’s annual reports for the
last ten-year period to determine if a trend existed in the disparity between gallons pumped and
gallons sold, as well as customer growth. Figure 1 displays gallons pumped and gallons sold data
from the Utility’s annual reports.
Figure 1
Pinecrest Gallons Pumped and Gallons Sold Data
Source: Utility’s Annual Reports.
As shown in Figure 1, it appears total gallons sold slightly declined within the last five
years of the period (2018 through 2022) as compared to the first five years of the period (2013
through 2017), while total gallons pumped increased substantially when comparing the same
periods. Between 2017 and 2018 alone, the Utility recorded an increase in total gallons pumped
of 4,040,000 gallons, while water sold declined by 734,000 gallons. Figure 2 displays the
Utility’s customer growth as identified in its last ten annual reports. In comparison, the Utility’s
customer base has only slightly increased within the last five years of the period as compared to
the first five years.
14 Document No. 00913-2024, filed on February 26, 2024.
7.07
6.16
7.38
8.27
9.77
13.81
17.07
14.45
16.05
12.49
7.07
6.16
	6.68
8.12
	7.67
6.94
	6.90
	6.90
	6.94
5.11
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
18.00
2013 	2014 	2015 	2016 	2017 	2018 	2019 	2020 	2021 	2022
Gallons (Millions)
Water Pumped 	Water Sold

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Figure 2
Pinecrest Customer Growth
Source: Utility’s Annual Reports.
As noted previously, the Utility did not identify the source of the disparity between
gallons pumped and gallons sold, but speculated that faulty meters were responsible according to
its response to our data request. Therefore, while we agree that faulty water meters may be a
potential source of some unaccounted for water, the trend of increasing pumped gallons appears
higher than potential losses from meters without significant increases in individual water
consumption.
We also note that this Commission already allows for a 10 percent unaccounted for water
percentage prior to finding unaccounted for water excessive. As will be discussed in Section 4,
the Utility requested a new flow meter and a meter replacement/retrofit project as part of its pro
forma project requests. If the Utility is able to demonstrate that these projects rectify this issue,
the Utility can seek an adjustment to eliminate any EUW adjustment through a petition for a
limited proceeding or a future SARC application, which may also require rates to be reset as well
to reflect the additional sales previously unaccounted for and that were not used in the
determination of rates in this SARC.
During our investigation of the values provided in the Utility’s 2022 Annual Report for
water loss related to flushing and other events, the Office of Public Counsel (OPC) also
expressed concerns with these values. In its letter dated February 2, 2024, OPC recommended
that an adjustment of 49.09 percent be made to purchased power and chemicals expenses for
EUW based on allowing 10 percent of total gallons of water produced to be allotted for
flushing. 15 While we agree with OPC that an adjustment is necessary, our EUW calculation is
based on information provided by the Utility regarding its flushing activities and other instances
of water loss. Therefore, we find its calculated value of a 47.6 percent adjustment to purchased
power and chemicals expenses is more appropriate. Based on the above analysis, we find that a
47.6 percent adjustment be made to purchased power and chemicals expenses.
15 Document No. 00523-2024, filed on February 2, 2024.
128
147
120 127 	132 	132 	133 142 	142 	143
134
120 	125 132 	133 	133 142 	143 	143 	140
0
20
40
60
80
100
120
140
160
2013 	2014 	2015 	2016 	2017 	2018 	2019 	2020 	2021 	2022
Number of Customers
Customers at Start of Year 	Customers at End of Year

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C. Service Interruption Records and Reporting
Pursuant to Rule 25-30.251(1) and (2), F.A.C., each utility is required to maintain a
record of all interruptions in service which affect 10 percent or more of its customers, and notify
us of these interruptions. The record is required to show the cause of the interruption, its date,
time, duration, remedy, and steps taken to prevent recurrence. In response to our Seventh Data
Request, Pinecrest provided its records for the test year and four years prior; however, these
records did not appear to address all items required by the Rule, nor did the Utility notify us of
the interruptions.16 Specifically, the remedy to the interruption or steps taken to prevent
recurrence did not appear to be outlined in the records. As such, we find that the Utility maintain
its service interruption records meeting the 10 percent threshold in the manner outlined in Rule
25-30.251(1), F.A.C., and notify us of any such interruptions on a going-forward basis.
D. Conclusion
Pinecrest’s WTP and water distribution system shall be considered 100 percent U&U.
Additionally, we find that a 47.60 percent adjustment to purchased power and chemicals
expenses be made for EUW.
4. Average Test Year Rate Base
The appropriate components of the Utility’s rate base include utility plant in service
(UPIS), land and land rights, accumulated depreciation, contributions-in-aid of construction
(CIAC), accumulated amortization of CIAC, and working capital. We determined that the
Utility’s books and records are in compliance with the National Association of Regulatory
Utility Commissioners’ Uniform System of Accounts (NARUC USOA). A summary of each
component and the approved adjustments are discussed below.
A. Utility Plant in Service
The Utility recorded a UPIS balance of $257,345. As part of Audit Finding 1 (AF-1), we
capitalized 	$1,093 	from 	operation 	and 	maintenance 	(O&M) 	account 	636 	related 	to 	the
replacement of a control box, resulting in an increase of $1,093.17 Additionally, as part of AF-1,
we decreased UPIS by $500 due to lack of supporting documentation from the Utility. Based on
the Utility’s response to our Audit Report, we decreased UPIS by $4,000 to reflect the
appropriate plant balance in Account 345 – Power Operated Equipment.18 Further, we decreased
UPIS by $3,511 to reflect an averaging adjustment.
Pro Forma Plant Additions
Table 	2 	shows 	Pinecrest’s 	three 	requested 	pro 	forma 	plant 	projects: 	1) 	a 	meter
replacement/retrofit project; 2) a flow meter replacement; and 3) a lawn mower replacement.
16 Document No. 00695-2024, filed on February 13, 2024.
17 Document No. 05904-2023, filed on October 31, 2023.
18 Document. No. 06125-2023, filed on November 20, 2023.

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Pinecrest 	explained 	that 	its 	meter 	replacement/retrofit 	project 	is 	the 	same 	as 	the 	meter
replacement program approved for Leighton Estates Utilities, LLC (Leighton) in its last SARC,
as Pinecrest will be using the same software and meters.19 Pinecrest intends to replace 82 and
retrofit 62 residential meters.
Pinecrest 	will 	also 	be 	transitioning 	its 	residential 	meters 	to 	Advanced 	Meter
Infrastructure (AMI) meters for compatibility with the Beacon Software approved by us in the
Leighton SARC for use by all of the Florida Utility Services 1 (FUS1) water systems. Pinecrest
asserted that AMI meters will allow the Utility to electronically obtain meter readings, provide
real-time data accessibility, and reduce customer service-related calls and associated work order
trips.
Pinecrest requested Beacon Software for the AMI meters. The cost allocated to Pinecrest
for use of the Beacon Software was $346.20 In response to our Sixth Data Request, the Utility
indicated that the vendor will not provide a final invoice for the Beacon Software until after file
integration is complete, and provided its updated estimate of $352 to be allocated to Pinecrest.21
Because no bid or invoice was provided to support this estimate, we included the $346 cost
allocation identified in the Leighton SARC in the total meter replacement/retrofit project cost in
Table 2. If the Utility can demonstrate that the final cost for incorporation of this software
increased, the Utility can request the differential in a future proceeding. Pinecrest intends to
replace 82 and retrofit 62 residential meters.
In addition, the Utility provided a bid reflecting the current costs for new meters and
meter retrofits for compatibility from Badger Meter. In response to our Third Data Request, the
Utility estimated that labor would cost about $22 for each meter replacement and retrofit.22
Because the meter replacement/retrofit project will be implemented by full-time employees of
FUS1 already accounted for through FUS1’s payroll, labor costs have been excluded.
The flow meter replacement pro forma project is a result of Pinecrest’s current flow
meter failing. In response to our Third Data Request, the Utility explained that the new flow
meter was purchased from the same vendor used for the meter replacement/retrofit project for
compatibility with the Beacon Software. The Utility indicated that it intends to purchase all
residential and flow meters from this this vendor on a going-forward basis for this reason. In
response to our Ninth Data Request, the Utility indicated that the new flow meter has been
installed.23 The total cost for this project is included in Table 2.
Lastly, the Utility is requesting a lawn mower replacement due to the current lawn mower
being near the end of its useful life. As our practice, we requested that three bids be provided for
this pro forma project. However, the Utility explained that it was only able to obtain bids from
two vendors within a reasonable distance as the tractor will have to be taken to the vendor to
19 Order No. PSC-2022-0435-PAA-WU, issued on December 22, 2022, in Docket No. 20220026-WU, In re:
Application for staff-assisted rate case in Marion County, and request for interim rate increase, by Leighton Estates
Utilities, LLC.
20 Document No. 04414-2022, filed on July 1, 2022, in Docket No. 20220026-WU, In re: Application for staff-
assisted rate case in Marion County, and request for interim rate increase, by Leighton Estates Utilities, LLC.
21 Document No. 00573-2024, filed on February 5, 2024.
22 Document No. 06130-2023, filed on November 20, 2023.
23 Document No. 00913-2024, filed on February 26, 2024.

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have the mower deck and attaching equipment installed. Of the two bids provided, the Utility
indicated that intends to select the least-cost vendor for this project.24 The total cost for this
project is included in Table 2. As these improvements are necessary for the Utility to provide
safe and reliable service to its customers, we find that these project costs are appropriate.
Table 2
Pro Forma Plant Items
Project 	Additions 	Retirements
Acct. 334 – Meter Replacement / Retrofit 	$2,368 	($819)
Acct. 334 – New Flow Meter 	1,862 	(1,397)
Acct. 343 – New Mower 	4,066 	(3,050)
Total Pro Forma 	$8,296 	($5,265)
Source: Utility responses to staff data requests.
As detailed above in Table 2, we increased UPIS by $8,296. This amount was offset by
retirements of $5,265. Table 3 on the following page summarizes our adjustments to UPIS.
Table 3
Commission Adjustments to UPIS
Description 	Adjustment
To reflect capitalization of control box replacement. 	$1,093
To reflect adjustments from lack of supporting documentation. 	(500)
To reflect appropriate plant balance of acct. 345. 	(4,000)
To reflect an averaging adjustment. 	(3,511)
To reflect pro forma additions. 	8,296
To reflect pro forma retirements. 	(5,265)
Total adjustments to UPIS. 	($3,887)
Source: Staff calculations.
As described above and summarized in Table 3, our adjustments to UPIS result in a
decrease of $3,887. Therefore, we find an average UPIS balance of $253,458 ($257,345 -
$3,887).
B. Land and Land Rights
The Utility recorded a land and land rights balance of $6,500. No adjustments were made
to land and land rights, therefore, we find land and land rights balance of $6,500.
C. Used and Useful
As discussed in Section 3, the Utility’s system is considered 100 percent U&U.
Therefore, no U&U adjustment is necessary.
24 Document No. 00695-2024, filed on February 13, 2024.

ORDER NO. PSC-2024-0100-PAA-WU
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D. Accumulated Depreciation
The Utility recorded an accumulated depreciation balance of $192,282. As part of Audit
Finding 2 (AF-2), we found the Utility was inconsistently recording accumulated depreciation
since 	the 	last 	rate 	case, 	and 	therefore 	decreased 	accumulated 	depreciation 	by 	$3,789.25
Additionally, we made an averaging adjustment, decreasing accumulated depreciation by $4,565.
WE also decreased accumulated depreciation by $5,079 for pro forma-related items. Therefore,
we find an average accumulated depreciation balance of $178,849 ($192,282 - $3,789 - $4,565 -
$5,079).
E. Contributions-in-aid-of-Construction
The Utility recorded a CIAC balance of $100,352. We made no adjustments to CIAC,
and therefore approve an average CIAC balance of $100,352.
F. Accumulated Amortization of CIAC
The Utility recorded an accumulated amortization of CIAC balance of $100,352. The
accumulated amortization of CIAC balance at the beginning of the test year was $97,541. As
such, we made an averaging adjustment to reduce accumulated amortization of CIAC by $1,406.
Therefore, we find an accumulated amortization of CIAC balance of $98,947 ($100,352 -
$1,406).
G. Working Capital Allowance
Working capital is defined as the short-term investor-supplied funds that are necessary to
meet operating expenses. Consistent with Rule 25-30.433(3), F.A.C., we used the one-eighth
O&M expense (less rate case expense) formula for calculating the working capital allowance.
Section 367.081(9), F.S., prohibits a utility from earning a return on the unamortized balance of
rate case expense. As such, for this calculation, we removed the rate case expense of $509. This
resulted in an adjusted O&M expense balance of $67,265 ($67,774 - $509). Following the
application of the aforementioned formula, we find a working capital allowance of $8,408
($67,265 ÷ 8).
H. Rate Base Summary
Based on the foregoing, we find that the appropriate test year average rate base is
$88,111. Rate base is shown on Schedule No. 1-A. The related adjustments are shown on
Schedule No. 1-B.
5. Rate of Return
The Utility’s capital structure consists of long-term debt, common equity and customer
deposits. We reclassified $18,408 originally recorded as “due to parent company” on the
25 Document No. 05904-2023, filed on October 31, 2023.

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DOCKET NO. 20230071-WU
PAGE 13
Utility’s 2022 Annual Report, as common equity. Additionally, in response to our Sixth Data
Request, the Utility stated the $8,296 pro forma cost will be paid by the Utility’s parent
company, FUS1. 26 Therefore, we applied this amount to the Utility’s common equity.
The Utility’s capital structure has been reconciled with our approved rate base. The
appropriate ROE is 8.50 percent based on our current approved leverage formula.27 We find an
ROE of 8.50 percent with a range of 7.50 percent to 9.50 percent, and an overall rate of return of
8.18 percent. The proposed ROE and overall rate of return are shown on Schedule No. 2.
6. Test Year Revenues
The Utility recorded test year operating revenue of $59,185, which included service
revenues of $57,145 and miscellaneous revenues of $2,040. A review of the Utility’s billing
register indicated 64 bills were related to vacant properties. We removed the bills to determine
the appropriate billing determinants. The Utility also had a price index that became effective on
June 1, 2023. To determine the appropriate service revenues, we annualized service revenues by
applying the adjusted number of billing determinants to the rates in effect on June 1, 2023. As a
result, we determined that the service revenues shall be $62,635, which is an increase of $5,490
($62,635 - $57,145). Furthermore, we increased miscellaneous revenues by $68 to adjust for
customer deposit interest that was incorrectly recorded as miscellaneous revenues. This results in
miscellaneous revenues of $2,108 ($2,040 + $68) during the test year. Therefore, we find that the
appropriate test year operating revenue for Pinecrest’s water system is $64,743 ($62,635 +
$2,108).
7. Operating Expenses
The Utility recorded an operating expense of $79,621. The test year O&M expenses have
been reviewed by us, including invoices and other supporting documentation. We have made
several adjustments to the Utility’s operating expense as described below.
A. Operation and Maintenance Expense
After review of the Utility’s records, we made no adjustments to the recorded expenses in
fuel for power production (616), materials and supplies (620), contractual services – professional
(631), contractual services – testing (635), rents (640), transportation (650), insurance (655), or
miscellaneous expenses (675). We find expenses for these accounts are shown on Schedule No.
3-C.
Salaries and Wages – Employees (601)
The Utility recorded salaries and wages – employees expense of $16,421. The Utility
submitted a request for a pro forma salary increase intended to attract and retain qualified
26 Document No. 00573-2024, filed on February 5, 2024.
27 Order No. PSC-2023-0189-PAA-WS, issued on June 28, 2023, in Docket No. 20230006-WS; In re: Water and
wastewater industry annual reestablishment of authorized range of return on common equity for water and
wastewater utilities pursuant to Section 367.081(4)(f), F.S.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 14
employees given the current economic climate.28 The Utility’s pro forma request was based on a
compensation study.29 After thorough review of the Utility’s request and compensation study, we
increased this account by $3,463. Therefore, we find salaries and wages – employees expense of
$19,884 ($16,421 + $3,463).
Salaries and Wages – Officers and Directors (603)
The Utility recorded salaries and wages – officers and directors expense of $3,201. In its
request for pro forma salary increases dated October 27, 2023, the Utility identified the need for
a new Salary and Benefits Administrator to assume some of the payroll responsibilities of the
Chief Financial Officer. After thorough review of the Utility’s request, we increased this account
by $795. Therefore, we find salaries and wages – officers and directors expense of $3,996
($3,201 + $795).
Employees Pensions and Benefits (604)
The Utility recorded employee pensions and benefits expense of $4. In its pro forma
salary request, the Utility stated it desires to provide its employees a retirement benefit beginning
in 2023. The parent company of the Utility, FUS1 believes that the addition of a retirement
benefit is necessary to attract and retain future qualified employees to serve its existing and
future customers, and therefore proposes to establish a “Simple IRA Plan” as defined under
Section 408(b) of the Internal Revenue Code. After a thorough review of the Utility’s request,
we increased this account by $402. Therefore, we find employee pensions and benefits expense
of $406 ($4 + $402).
Purchased Power (615)
The Utility recorded purchased power expense of $8,350. As discussed in Section 3, we
find an EUW adjustment of 47.6 percent. As such, we decreased purchased power expense by
$3,975. Therefore, we find purchased power expense of $4,375 ($8,350 - $3,975).
Chemicals (618)
The Utility recorded chemicals expense of $4,887. Similarly, as discussed in Section 3,
we made an EUW adjustment of 47.6 percent, reducing chemicals expense by $2,326. Therefore,
we find chemicals expense of $2,561 ($4,887 - $2,326).
Contractual Services – Other (636)
The Utility recorded contractual services – other expense of $8,908. During the audit, it
was found that a cost of $1,093 for the replacement of a control box for the Utility’s pumping
equipment was recorded in this account. We do not find this is a recurring expense and the
28 Document No. 05861-2023, filed on October 27, 2023.
29 Document No. 01002-2024, filed on March 4, 2024.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 15
replacement was necessary for the pumping equipment to operate. Based on this, we decreased
contractual services – other expense by $1,093 and capitalized this amount to plant account 311
consistent with AF-1. Therefore, we find contractual services – other expense of $7,815 ($8,908
- $1,093).
Regulatory Commission Expense (665)
The Utility recorded a regulatory commission expense of $816 as a deferred cost from its
previous limited alternative rate increase.30 The Utility did not record any rate case expense for
the instant docket. The Utility is required by Rule 25-22.0407, F.A.C., to mail notices of the rate
case overview, interim rates, final rates, and four-year rate reduction. We calculated noticing
costs to be $558. We calculated the distance from the Utility to Tallahassee as 214 miles. Based
on the 2023 IRS business mileage rate of $0.655, we calculated a round-trip travel and lodging
expense to the Commission Conference of $480.31 Additionally, the Utility paid a filing fee of
$1,000.32
We find a total rate case expense, consisting of noticing costs, travel and lodging
expenses, and filing fee of $2,038 ($558 + $480 + $1,000), which amortized over four years is
$509 ($2,038 ÷ 4 years). Therefore, we find a total regulatory commission expense of $1,325
($816 + $509).
Bad Debt Expense (670)
The Utility recorded bad debt expense of $763. We note that it is our practice to calculate
bad debt expense using a three-year average when sufficient information is available.33 In its
three most recent Annual Reports (2020, 2021, and 2022), the Utility recorded bad debt expenses
of $743, $2,357, and $763, respectively. We calculated the average bad debt expense for these
previous three years to be $1,288 (($743 + $2,357 + $763) ÷ 3) which represents an increase of
$525. Therefore, we find bad debt expense of $1,288 ($763 + $525).
B. Operation and Maintenance Expense Summary
The Utility recorded a test year O&M expense of $69,474. Based on the above
adjustments, we find O&M expense be decreased by $1,700. This results in a total O&M
30 Order No. PSC-2020-0396-PAA-WS, issued on October 22, 2020, in Docket No. 20200152-WS; In re:
Application for a limited alternative rate increase proceeding in Polk and Marion Counties by Alturas Water, LLC,
Sunrise Water, LLC, Pinecrest Utilities, LLC, and East Marion Utilities, LLC.
31 https://www.irs.gov/newsroom/irs-issues-standard-mileage-rates-for-2023-business-use-increases-3-cents-per-
mile.
32 Document No. 03753-2023, filed on June 22, 2023.
33 Order No. PSC-2022-0043-PAA-WU, issued on January 26, 2022, in Docket No. 20210055-WU, In re:
Application for staff-assisted rate case in Lake County by Brendenwood Waterworks, Inc.; Order No. PSC-2021-
0106-PAA-WS, issued on March 17, 2021, in Docket No. 20200169-WS, In re: Application for staff-assisted rate
case in Lake County, and request for interim rate increase, by Lake Yale Utilities, LLC.; Order No. PSC-2021-0107-
PAA-WU, issued on March 19, 2021, in Docket No. 20200168-WU, In re: Application for staff-assisted rate case in
Polk County, and request for interim rate increase, by McLeod Gardens Utilities, LLC.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 16
expense of $67,774 ($69,474 - $1,700). Our approved adjustments to O&M are shown on
Schedule No. 3-C.
C. Depreciation Expense
The Utility recorded depreciation expense of $9,020. Using the depreciation rates
prescribed in Rule 25-30.140, F.A.C., we increased this amount by $869 as part of AF-2. We
made adjustments decreasing depreciation expense by $1,356 to prevent over depreciation of
certain plant accounts. Additionally, we increased depreciation expense by $186 due to the
inclusion of pro forma plant items. These adjustments result in a net decrease of $301 ($869 -
$1,356 + $186). Therefore, we find depreciation expense of $8,719 ($9,020 - $301).
D. Amortization of CIAC
The Utility recorded amortization of CIAC of $2,811. We made no adjustments and
therefore approve amortization of CIAC of $2,811.
E. Taxes Other Than Income (TOTI)
The Utility recorded TOTI of $3,938. We increased TOTI by $250 to reflect the
appropriate regulatory assessment fees (RAFs) based on corrected Utility test year revenues.
Additionally, we increased TOTI by $270 to reflect the pro forma payroll taxes associated with
the pro forma increase in salaries explained previously in O&M accounts 601 and 603. Those
adjustments result in a test year TOTI increase of $520 ($250 + $270).
As discussed in Section 9, we find revenues be increased by $21,579 in order to reflect
the change in revenue required to cover expenses and provide the Utility an opportunity to earn
the approved rate of return. As a result, TOTI shall be increased by $971 to reflect RAFs of 4.5
percent of the change in revenues. Therefore, we find TOTI of $5,429 ($3,938 + $520 + $971).
F. Operating Expense Summary
The Utility recorded operating expenses of $79,621. The application of our approved
adjustments to the Utility’s approved operating expenses result in a total operating expense of
$79,111. Operating expenses are shown on Schedule No. 3-A, and the related adjustments are
shown on Schedule No. 3-B.
8. Operating Ratio Methodology
Rule 25-30.4575(2), F.A.C., provides that, in rate cases processed under Rule 25-30.455,
F.A.C., we will use the operating ratio methodology to establish a utility’s revenue requirement
when its rate base is not greater than 125 percent of O&M expenses, less regulatory commission
expense, and the use of the operating ratio methodology does not change a utility’s qualification
for a SARC.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 17
With respect to Pinecrest, we find a rate base of $88,111. After removal of rate case
expense, we have calculated an O&M expense of $67,265 ($67,774 - $509). Based on our
approved, the Utility’s rate base is 131 percent of its adjusted O&M expense. Based on this, the
Utility does not qualify for application of the operating ratio methodology.
9. Revenue Requirement
Pinecrest shall be allowed an annual revenue requirement increase of $21,579 (33.33
percent). This will allow the Utility the opportunity to recover expenses and earn an 8.18 percent
return on rate base. The calculation for revenue requirement is shown on Table 4 below.
Table 4
Revenue Requirement
Water Rate Base 	$88,111
Rate of Return 	8.18%
Return on Rate Base 	$7,210
Water O&M Expense 	67,774
Depreciation Expense 	8,719
Amortization 	(2,811)
Taxes Other Than Income 	5,429
Revenue Requirement 	$86,321
Less Test Year Revenues 	$64,743
Annual Increase 	$21,579
Percent Increase 	33.33%
Source: Staff calculations.
10. Rate Structure
Pinecrest is located in Polk County within the Southwest Florida Water Management
District. The Utility provides water service to 138 residential customers and there are no general
service customers. Approximately 19 percent of the residential customer bills during the test year
had zero gallons, indicating a non-seasonal customer base. The average residential water demand
is 3,094 gallons per month. Currently, the Utility’s water rate structure consists of a monthly
base facility charge (BFC) and a charge per 1,000 gallons for residential and general service
customers.
We performed an analysis of the Utility’s billing data in order to evaluate the appropriate
rate structure for the residential water customers. The goal of the evaluation was to select the rate
design parameters that: (1) produce the approved revenue requirement; (2) equitably distribute
cost recovery among the Utility’s customers; (3) establish the appropriate non-discretionary
usage 	threshold 	for 	restricting 	repression; 	and 	(4) 	implement, 	where 	appropriate, 	water
conserving rate structures consistent with our practice.
For this case, we find that 40 percent of the water revenues be generated from the BFC,
which will provide sufficient revenues to design gallonage charges that send pricing signals to

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 18
customers using above the non-discretionary level. The average people per household served by
the water system is 2.77; therefore, based on the number of people per household, 50 gallons per
day per person, and the number of days per month, the non-discretionary usage threshold shall be
5,000 gallons per month. Our review of the billing data indicates that discretionary usage above
5,000 gallons represents approximately 18 percent of the bills, which accounts for approximately
24 percent of water demand. This indicates that there is a moderate amount of discretionary
usage above 5,000 gallons.
We find a two-tier inclining block rate structure, which includes separate gallonage
charges for non-discretionary and discretionary usage for residential water rates. The rate blocks
are: 1) 0-5,000 gallons; and 2) all usage in excess of 5,000 gallons per month. Due to the
moderate usage above 5,000 gallons per month, we find that it is appropriate in this case to
approve a rate factor of 1.25 in the second tier because it will target those customers with higher
levels of consumption. General service customers shall continue to be billed a BFC and uniform
gallonage charge.
Based on our approved revenue increase of 34.5 percent, which excludes miscellaneous
revenues, the residential consumption can be expected to decline by 294,000 gallons resulting in
anticipated average residential demand of 2,916 gallons per month. We find a 5.8 percent
reduction in test year residential gallons for rate setting purposes. As a result, the corresponding
reductions are $252 for purchased power expense, $147 for chemicals expense, and $19 for
RAFs to reflect the anticipated repression, which results in a post repression revenue requirement
of $83,042.
The approved rate structures and monthly water rates are shown on Schedule No. 4. The
Utility shall file revised tariff sheets and a proposed customer notice to reflect our approved
rates. The approved rates shall be effective for service rendered on or after the stamped approval
date on the tariff sheets pursuant to Rule 25-30.475(1), F.A.C. In addition, the approved rates
shall not be implemented until our staff has approved the proposed customer notice and the
notice has been received by the customers. The Utility shall provide proof of the date notice was
given within 10 days of the date of the notice.
11. Appropriate Initial Customer Deposits
Rule 25-30.311, F.A.C., provides the criteria for collecting, administering, and refunding
customer deposits. Customer deposits are designed to minimize the exposure of bad debt expense
for the utility and, ultimately, the general body of ratepayers. An initial customer deposit ensures
that the cost of providing service is recovered from the cost causer. Historically, we have set
initial customer deposits equal to two times the average estimated bill. Currently, the Utility’s
initial customer deposit for the residential 5/8 inch x 3/4 inch meter size is $67 for water. This
amount does not cover two months’ average bills based on our approved rates. The Utility’s
anticipated post-repression average monthly residential usage is 2,916 gallons per customer.
Therefore, the average residential monthly bill based on our approved rates is approximately
$48.86.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 19
We find the appropriate initial customer deposit for the residential 5/8 inch x 3/4 inch
meter size shall be $98. The initial customer deposits for all other residential meter sizes and all
general service meter sizes shall be two times the average estimated bill. The approved initial
customer deposits shall be effective for services rendered or connections made on or after the
stamped approval date on the tariff sheets pursuant to Rule 25-30.475, F.A.C. The Utility shall
be required to collect the approved deposits until authorized to change them by us in a
subsequent proceeding.
12. Appropriate Miscellaneous Charges
The Utility is requesting to revise some of its existing miscellaneous service charges.
Section 367.091, F.S., authorizes us to establish, increase, or change a rate or charge other than
monthly rates or service availability charges. The Utility’s requested miscellaneous charges were
accompanied by its reason for requesting the charges, as well as the cost justification required by
Section 367.091(6), F.S. The Utility’s requested and revised miscellaneous service charges along
with the existing are shown below.
Table 5
Pinecrest’s Existing and Requested Miscellaneous Service Charges
Existing 	Requested
Initial Connection Charge 	$15.00 	Actual Cost
Normal Reconnection Charge 	$15.00 	$34.50
Violation Reconnection Charge 	$15.00 	$34.50
Premises Visit Charge (in lieu of disconnection) 	$10.00 	$34.50
Late Payment Charge 	$5.50 	$7.00
Source: Utility’s current tariff and responses to staff’s data requests.
A. Premises Visit and Violation Reconnection Charge
As shown on Table 5, Pinecrest’s request consists of several miscellaneous service
charges. However, Rule 25-30.460, F.A.C., does not allow for initial connection and normal
reconnection charges.34 The Utility’s requested initial connection and normal reconnection
charges are obsolete and inconsistent with the rule. The Utility’s calculation for the premises
visit charge and violation reconnection are shown on Table 6.
The Utility provided cost justification of $34.58 for both the premises visit and violation
reconnection charges which represents the cost of a trip to perform a specified service. We find
the cost justification is reasonable and supports the Utility’s requested charge of $34.50. In
addition, the requested charge defrays the cost to the cost causer. However, the violation
reconnection 	charge 	shall 	account 	for 	the 	discontinuance 	of 	service 	and 	the 	subsequent
reconnection of service. Therefore, the violation reconnection charge shall account for both
services at a charge of $69.00 ($34.50 x 2). Based on the rule, we find that the initial connection
34 Order No. PSC-2021-0201-FOF-WS, issued on June 4, 2021, in Docket No. 20200240-WS, In re: Proposed
amendment of Rule 25-30.460, F.A.C., Application for Miscellaneous Service Charges.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 20
and normal reconnection charges be removed. We find that the Utility’s requested premises visit
charge of $34.50 and a violation reconnection charge of $69.00 shall be approved.
Table 6
Calculation for Premises Visit and Violation Reconnection Charge
Activity 	Cost
Mileage ($0.67 per mile x 2/3 hour x 11) 	$7.37
Administrative Labor ($26.10 per hour x 1/3 hour) 	7.83
Field Labor ($26.10 per hour x 1/2 hour) 	13.05
CSM Labor ($25.30 per hour x 1/4 hour) 	6.33
Total 	$34.58
Source: Utility’s cost justification documentation.
B. Late Payment Charge
The Utility currently has a $5.50 late payment charge. The Utility is requesting a $7.00
late payment charge to recover the cost of labor, supplies, and postage associated with processing
late payment notices. The purpose of this charge is not only to provide an incentive for
customers to make timely payment, thereby reducing the number of delinquent accounts, but also
to place the cost burden of processing delinquent accounts solely upon those who are cost
causers. The Utility calculated the actual costs for its late payment charges to be $7.07. The
Utility indicated that it will take approximately 15 minutes per account to research, compile, and
produce late notices. The delinquent customer accounts will be processed by the administrative
employee, which results in labor cost of $6.33 ($25.30 x 0.25hr). This is consistent with our prior
decisions where we have allowed 5-15 minutes per account per month for the administrative
labor associated with processing delinquent customer accounts.35
In addition, the Utility included material cost of $0.74 for paper, envelopes, and postage,
which results in total costs of $7.07 ($6.33 + $0.74). The Utility’s calculation for its costs
associated with a late payment charge is shown on Table 7. We find the requested late payment
charge of $7.00 be approved.
35 Order Nos. PSC-2016-0041-TRF-WU, issued January 25, 2016, in Docket No. 20150215-WU, In re: Request for
approval of tariff amendment to include miscellaneous service charges for the Earlene and Ray Keen Subdivisions,
the Ellison Park Subdivision and the Lake Region Paradise Island Subdivision in Polk County, by Keen Sales, and
Utilities, Inc. and PSC-2015-0569-PAA-WS, issued December 16, 2015, in Docket No. 20140239-WS, In re:
Application for staff-assisted rate case in Polk County by Orchid Springs Development Corporation.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 21
Table 7
Late Payment Charge Cost Justification
Category 	Cost
Labor 	$6.33
Materials 	0.08
Postage 	0.66
Total Cost 	$7.07
Source: Utility’s cost justification documentation.
Table 8
Commission Approved Miscellaneous Service Charges
All Hours
Violation Reconnection Charge 	$69.00
Premises Visit Charge 	$34.50
Late Payment Charge 	$7.00
Source: Staff Calculations
C. Conclusion
Based on the above, we find that the appropriate miscellaneous service charges shown on
Table 8 shall be approved. The Utility shall be required to file a proposed customer notice to
reflect our approved charges. The approved charges shall be effective on or after the stamped
approval date on the tariff sheet pursuant to Rule 25-30.475(1), F.A.C. In addition, the approved
charges shall not be implemented until our staff has approved the proposed customer notice and
the notice has been received by customers. The Utility shall provide proof of the date notice was
given no less than 10 days after the date of the notice.
13. Four-Year Rate Reduction
Section 367.081(8), F.S., requires that the rates be reduced by the amount of rate case
expense previously included in rates immediately following the expiration of the recovery
period. With respect to Pinecrest, the reduction will reflect the removal of revenue associated
with the amortization of rate case expense and the gross-up for RAFs. The total reduction is
$533.
We find that the rates shall be reduced as shown on Schedule No. 4, to remove rate case
expense grossed-up for RAFs and amortized over a four-year period. Pursuant to Section
367.081(8), F.S., the decrease in rates shall become effective immediately following the
expiration of the rate case expense recovery period. Pinecrest shall be required to file revised
tariffs and a proposed customer notice setting forth the lower rates and rationale no later than one
month prior to the effective date of the new rates. If the Utility files revised tariffs reflecting this
reduction in conjunction with a price index, or pass-through rate adjustment, separate data shall
be filed for the price index and/or pass-through increase and the reduction in the rates due to the
amortized rate case expense.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 22
14. Approval of Rates on a Temporary Basis
This Order proposes an increase in rates. A timely protest might delay a rate increase
resulting in an unrecoverable loss of revenue to the Utility. Therefore, pursuant to Section
367.0814(7), F.S., in the event of a protest filed by a party other than the Utility, we approve the
proposed rates on a temporary basis. Pinecrest shall file revised tariff sheets and a proposed
customer notice reflecting our approved rates. The approved rates shall be effective for service
rendered on or after the stamped approval date on the tariff sheet, pursuant to Rule 25-30.475(1),
F.A.C. In addition, the temporary rates shall not be implemented until our staff has approved the
proposed notice, and it has been received by the customers. The additional revenue produced by
our approved rates and collected by the Utility shall be subject to the refund provisions discussed
below.
Pinecrest shall be authorized to initiate the temporary rates upon our approval of an
appropriate security for the potential refund and cost of the proposed customer notice. Security
shall be in the form of either a bond or letter of credit in the amount of $14,896. Alternatively,
the Utility may establish an escrow agreement with an independent financial institution.
If the Utility chooses a bond for securing the potential refund, the bond shall contain
wording to the effect that it will be terminated only under the following conditions:
1. 	We approve the rate increase; or,
2. 	If we deny the increase, the Utility shall refund the amount collected that is attributable to
the increase.
If the Utility chooses a letter of credit for securing the potential refund, the letter of credit shall
contain the following conditions:
1. 	The letter of credit is irrevocable for the period it is in effect.
2. 	The letter of credit will be in effect until a final Commission order is rendered, either
approving or denying the rate increase.
If security is provided through an escrow agreement, the following conditions shall be part of the
agreement:
1. 	The Commission Clerk, or his or her designee, must be a signatory to the escrow
agreement.
2. 	No monies in the escrow account may be withdrawn by the Utility without the prior
written authorization of the Commission Clerk, or his or her designee.
3. 	The escrow account shall be an interest bearing account.
4. 	If a refund to the customers is required, all interest earned by the escrow account shall be
distributed to the customers.
5. 	If a refund to the customers is not required, the interest earned by the escrow account
shall revert to the Utility.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 23
6. 	All information on the escrow account shall be available from the holder of the escrow
account to a Commission representative at all times.
7. 	The amount of revenue subject to refund shall be deposited in the escrow account within
seven days of receipt.
8. 	This escrow account is established by the direction of the Florida Public Service
Commission for the purpose(s) set forth in its order requiring such account. Pursuant to
Cosentino v. Elson, 263 So. 2d 253 (Fla. 3d DCA 1972), escrow accounts are not subject
to garnishments.
9. 	The account must specify by whom and on whose behalf such monies were paid.
In no instance shall the maintenance and administrative costs associated with the refund
be borne by the customers. These costs are the responsibility of, and shall be borne by, the
Utility. Irrespective of the form of security chosen by the Utility, an account of all monies
received as a result of the rate increase shall be maintained by the Utility. If a refund is
ultimately required, it shall be paid with interest calculated pursuant to Rule 25-30.360(4),
F.A.C.
The Utility shall maintain a record of the amount of the bond, and the amount of revenues
that are subject to refund. In addition, after the increased rates are in effect, pursuant to Rule 25-
30.360(6), F.A.C., the Utility shall file reports with the Commission Clerk’s office no later than
the 20th of every month indicating the monthly and total amount of money subject to refund at
the end of the preceding month. The report filed shall also indicate the status of the security
being used to guarantee repayment of any potential refund.
15. Adjustment to Books
Pinecrest shall be required to notify us, in writing, that it has adjusted its books in
accordance with our decision. The Utility shall submit a letter within 90 days of our final order in
this docket, confirming that the adjustments to all applicable NARUC USOA primary accounts
have been made to the Utility’s books and records. In the event the Utility needs additional time
to complete the adjustments, a notice providing good cause shall be filed not less than seven days
prior to the deadline. Upon providing a notice of good cause, our staff shall be given
administrative authority to grant an extension of up to 60 days.
Based on the foregoing, it is
ORDERED by the Florida Public Service Commission that Pinecrest has been responsive
to customer complaints and is currently in compliance with Department of Environmental
Protection standards; therefore, the quality of service be considered satisfactory. It is further
ORDERED that Pinecrest’s water treatment facility is currently in compliance with DEP
regulations. It is further

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 24
ORDERED that Pinecrest’s WTP and water distribution system shall be considered 100
percent U&U. Therefore, a 47.6 percent adjustment shall be made to purchased power and
chemicals expenses be made for excessive unaccounted for water (EUW). It is further
ORDERED that the appropriate average test year rate base for Pinecrest is $88,111. It is
further
ORDERED that the appropriate return on equity (ROE) is 8.50 percent with a range of
7.50 percent to 9.50 percent. The appropriate overall rate of return is 8.18 percent. It is further
ORDERED that he appropriate test year operating revenue for Pinecrest’s water system is
$64,743. It is further
ORDERED that the appropriate amount of operating expense for Pinecrest is $79,111. It
is further
ORDERED that Pinecrest does not meet the requirement for application of the operating
ratio methodology for calculating the revenue requirement. It is further
ORDERED that the appropriate revenue requirement is $86,321, resulting in an annual
increase of $21,579 (33.33 percent). It is further
ORDERED that the approved rate structure and monthly water rates are shown on
Schedule No. 4. The Utility shall file revised tariff sheets and a proposed customer notice to
reflect our approved rates. The approved rates shall be effective for service rendered on or after
the stamped approval date on the tariff sheets pursuant to Rule 25-30.475(1), F.A.C. In addition,
the approved rates shall not be implemented until we have approved the proposed customer
notice and the notice has been received by the customers. The Utility shall provide proof of the
date notice was given within 10 days of the date of the notice. It is further
ORDERED that the appropriate initial customer deposit for the residential 5/8 inch x 3/4
inch meter size shall be $98. The initial customer deposits for all other residential meter sizes
and all general service meter sizes shall be two times the average estimated bill. The approved
initial customer deposits shall be effective for services rendered or connections made on or after
the stamped approval date on the tariff sheets pursuant to Rule 25-30.475, F.A.C. The Utility
shall be required to collect the approved deposits until authorized to change them by the
Commission in a subsequent proceeding. It is further
ORDERED that the appropriate miscellaneous service charges are shown on Table 8 and
shall be approved. The Utility shall be required to file a proposed customer notice to reflect the
Commission-approved charges. The approved charges shall be effective on or after the stamped
approval date on the tariff sheet pursuant to Rule 25-30.475(1), F.A.C. In addition, the approved
charge shall not be implemented until Commission staff has approved the proposed customer
notice and the notice has been received by customers. The Utility shall provide proof of the date
notice was given no less than 10 days after the date of the notice. It is further

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 25
ORDERED that the rates shall be reduced as shown on Schedule No. 4, to remove rate
case expense grossed-up for RAFs and amortized over a four-year period. Pursuant to Section
367.081(8), F.S., the decrease in rates shall become effective immediately following the
expiration of the rate case expense recovery period. Pinecrest shall be required to file revised
tariffs and a proposed customer notice setting forth the lower rates and rationale no later than one
month prior to the effective date of the new rates. If the Utility files revised tariffs reflecting this
reduction in conjunction with a price index or pass-through rate adjustment, separate data shall
be filed for the price index and/or pass-through increase and the reduction in the rates due to the
amortized rate case expense. It is further
ORDERED that, pursuant to Section 367.0814(7), F.S., the approved rates are temporary
and subject to refund with interest, in the event of a protest filed by a party other than the Utility.
Pinecrest shall file revised tariff sheets and a proposed customer notice reflecting the approved
rates. The approved rates shall be effective for services rendered on or after the stamped approval
date on the tariff sheet, pursuant to Rule 25-30.475(1), F.A.C. It is further
ORDERED that the temporary rates shall not be implemented until Commission staff has
approved the proposed notice, and the notice has been received by the customers. Further, prior
to implementing any temporary rates, the Utility shall provide appropriate financial security. The
approved temporary rates collected by the Utility shall be subject to the refund provisions. It is
further
ORDERED that after the increased rates are in effect, pursuant to Rule 25-30.360(6),
F.A.C., the Utility shall file reports with the Commission’s Office of Commission Clerk no later
than the 20th of each month indicating both the current monthly and total amount subject to
refund at the end of the preceding month. The report filed shall also indicate the status of the
security being used to guarantee repayment of any potential refund. It is further
ORDERED that Pinecrest shall notify us, in writing, that it has adjusted its books in
accordance with our decision. Pinecrest shall submit a letter within 90 days of our final order in
this docket, confirming that the adjustments to all applicable NARUC USOA primary accounts
have been made to the utility’s books and records. In the event the utility needs additional time to
complete the adjustments, a notice providing good cause shall be filed not less than seven days
prior to the deadline. Upon providing a notice of good cause, Commission staff shall be given
administrative authority to grant an extension of up to 60 days. It is further
ORDERED that if no person whose substantial interests are affected by the proposed
agency action files a protest within 21 days of the issuance of the Proposed Agency Action
Order, a Consummating Order shall be issued. The docket shall remain open for Commission
staff’s verification that the revised tariff sheets and customer notice have been filed by the Utility
and approved by Commission staff. Once these actions are complete, this docket shall be closed
administratively.

ORDER NO. PSC-2024-0 l 00-P AA-WU
DOCKET NO. 20230071-WU
PAGE 26
By ORDER of the Florida Public Service Commission this 17th day of April, 2024.
JDI
)
Commissi
Florida Public 	ervice Commission
2540 Shumard Oak Boulevard
Tallahassee, Florida 32399
(850) 413-6770
www.tloridapsc.com
Copies 	furnished: 	A copy of this docWTient is
provided to the parties of record at the time of
issuance and, if applicable, interested persons.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 27
NOTICE OF FURTHER PROCEEDINGS OR JUDICIAL REVIEW
The Florida Public Service Commission is required by Section 120.569(1), Florida
Statutes, to notify parties of any administrative hearing or judicial review of Commission orders
that is available under Sections 120.57 or 120.68, Florida Statutes, as well as the procedures and
time limits that apply. This notice should not be construed to mean all requests for an
administrative hearing or judicial review will be granted or result in the relief sought.
As identified in the body of this order, our actions are preliminary in nature, except for
(1) the reduction of rates after four years based upon the recovery of rate case expense, (2) the
granting of temporary rates in the event of protest, and (3) the requirement for proof of
adjustment of books and records. Any person whose substantial interests are affected by the
action proposed by this order may file a petition for a formal proceeding, in the form provided by
Rule 28-106.201, Florida Administrative Code. This petition must be received by the Office of
Commission Clerk, at 2540 Shumard Oak Boulevard, Tallahassee, Florida 32399-0850, by the
close of business on May 8, 2024. 	If such a petition is filed, mediation may be available on a
case-by-case basis. If mediation is conducted, it does not affect a substantially interested person's
right to a hearing. In the absence of such a petition, this order shall become effective and final
upon the issuance of a Consummating Order.
Any objection or protest filed in this docket before the issuance date of this order is
considered abandoned unless it satisfies the foregoing conditions and is renewed within the
specified protest period.
Any party adversely affected by the Commission's procedural action in this matter may
request: (1) reconsideration of the decision by filing a motion for reconsideration with the Office
of Commission Clerk, within fifteen (15) days of the issuance of this order in the form prescribed
by Rule 25-22.060, Florida Administrative Code; or (2) judicial review by the Florida Supreme
Court in the case of an electric, gas or telephone utility or the First District Court of Appeal in
the case of a water or wastewater utility by filing a notice of appeal with the Office of
Commission Clerk and filing a copy of the notice of appeal and the filing fee with the
appropriate court. This filing must be completed within thirty (30) days after the issuance of this
order, pursuant to Rule 9.110, Florida Rules of Appellate Procedure. The notice of appeal must
be in the form specified in Rule 9.900(a), Florida Rules of Appellate Procedure.

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 28
PINECREST UTILITIES, LLC 	SCHEDULE NO. 1-A
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
SCHEDULE OF WATER RATE BASE
BALANCE 	BALANCE
PER 	COMM. 	PER
DESCRIPTION 	UTILITY 	ADJUST. 	COMM.
1. 	UTILITY PLANT IN SERVICE 	$257,345 	($3,887) 	$253,458
2. 	LAND & LAND RIGHTS 	6,500 	0 	6,500
3. 	ACCUMULATED DEPRECIATION 	(192,282) 	13,433 	(178,849)
4. 	CIAC 	(100,352) 	0 	(100,352)
5. 	ACCUMULATED AMORTIZATION OF CIAC 	100,352 	(1,406) 	98,947
6. 	WORKING CAPITAL ALLOWANCE 	$0 	$8,408 	$8,408
WATER RATE BASE 	$71,563 	$16,548 	$88,111

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 29
PINECREST UTILITIES, LLC 	SCHEDULE NO. 1-B
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
ADJUSTMENTS TO RATE BASE
WATER
UTILITY PLANT IN SERVICE
To reflect capitalization of pumping equipment from OM Acct 636 (AF-1). 	$1,093
To reflect audit adjustments due to lack of supporting documentation (AF-1). 	(500)
To reflect appropriate plant balance of acct 345 (Document No. 06125-2023). 	(4,000)
To reflect an averaging adjustment. 	(3,511)
To reflect pro forma additions. 	8,296
To reflect pro forma retirements. 	(5,265)
Total 	($3,887)
ACCUMULATED DEPRECIATION
To reflect appropriate accumulated depreciation balance since last rate case (AF-2). 	$3,789
To reflect an averaging adjustment. 	4,565
To reflect pro forma adjustments. 	5,079
Total 	$13,433
ACCUMULATED AMORTIZATION OF CIAC
To reflect an averaging adjustment. 	($1,406)
WORKING CAPITAL ALLOWANCE
To reflect 1/8 of test year O&M expenses. 	$8,408

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 30
PINECREST UTILITIES, LLC 	SCHEDULE NO. 2
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
SCHEDULE OF CAPITAL STRUCTURE
SPECIFIC 	BALANCE 	PRO RATA 	BALANCE 	PERCENT
PER 	ADJUST- 	AFTER 	ADJUST- 	PER 	OF 	WEIGHTED
CAPITAL COMPONENT 	UTILITY 	MENTS 	ADJUSTMENTS 	MENTS 	COMM 	TOTAL 	COST 	COST
LONG-TERM DEBT 	$1,726 	$0 	$1,726 	($42) 	$1,684 	1.91% 	5.40% 	0.10%
SHORT-TERM DEBT 	0 	0 	0 	0 	0 	0.00% 	0.00% 	0.00%
COMMON EQUITY 	76,750 	8,296 	85,046 	(2,089) 	82,957 	94.15% 	8.50% 	8.00%
CUSTOMER DEPOSITS 	3,558 	0 	3,558 	(87) 	3,471 	3.94% 	2.00% 	0.08%
DEFERRED INCOME TAXES 	0 	0 	0 	0 	0 	0.00% 	0.00% 	0.00%
TOTAL CAPITAL 	$82,034 	$8,296 	$90,330 	($2,219) 	$88,111 	100.00% 	8.18%
RANGE OF REASONABLENESS 	LOW 	HIGH
RETURN ON EQUITY 	7.50% 	9.50%
OVERALL RATE OF RETURN 	7.24% 	9.12%

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 31
PINECREST UTILITIES, LLC 	SCHEDULE NO. 3-A
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
SCHEDULE OF WATER OPERATING INCOME
TEST 	COMM. 	COMM. 	ADJUST.
YEAR PER 	ADJUST- 	ADJUSTED 	FOR 	REVENUE
UTILITY 	MENTS 	TEST YEAR 	INCREASE 	REQUIREMENT
TOTAL OPERATING REVENUES 	$59,184 	$5,558 	$64,743 	$21,579 	$86,321
33.33%
OPERATING EXPENSES:
OPERATION & MAINTENANCE 	$69,474 	($1,700) 	$67,774 	$0 	$67,774
DEPRECIATION 	9,020 	(301) 	8,719 	0 	8,719
AMORTIZATION OF CIAC 	(2,811) 	0 	(2,811) 	0 	(2,811)
TAXES OTHER THAN INCOME 	3,938 	520 	4,458 	971 	5,429
INCOME TAXES 	0 	0 	0 	0 	0
TOTAL OPERATING EXPENSES 	$79,621 	($1,481) 	$78,140 	$971 	$79,111
OPERATING INCOME / (LOSS) 	($20,437) 	($13,398) 	$7,210
WATER RATE BASE 	$71,563 	$16,548 	$88,111
RATE OF RETURN 	-25.86% 	-80.96% 	8.18%

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 32
PINECREST UTILITIES, LLC 	SCHEDULE 3-B
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
ADJUSTMENTS TO OPERATING INCOME 	PAGE 1 OF 2
WATER
OPERATING REVENUES
To reflect the appropriate test year Service Revenues. 	$5,490
To reflect the appropriate test year Miscellaneous Revenues. 	68
Total 	$5,558
OPERATION AND MAINTENANCE EXPENSE
Salaries and Wages - Employees (601 / 701)
To reflect Compensation Study (Document No. 01002-2024). 	$3,463
Salaries and Wages - Officers and Directors (603 / 703)
To reflect Compensation Study (Document No. 01002-2024). 	$795
Employee Pensions and Benefits (604 / 704)
To reflect Compensation Study (Document No. 01002-2024). 	$402
Purchased Power (615 / 715)
To reflect EUW adjustment. 	($3,975)
Chemicals Expense (618 / 718)
To reflect EUW adjustment. 	($2,326)
Contractual Services - Other (636 / 736)
To reflect capitalization of control box replacement to plant account 311. 	($1,093)
Rate Case Expense (665 / 765)
To reflect 1/4 rate case expense. 	$509
Bad Debt Expense (670 / 770)
To reflect 3-year average bad debt expense. 	$525
TOTAL OPERATION AND MAINTENANCE ADJUSTMENTS 	($1,700)

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 33
PINECREST UTILITIES, LLC 	SCHEDULE 3-B
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
ADJUSTMENTS TO OPERATING INCOME 	PAGE 2 OF 2
WATER
DEPRECIATION EXPENSE
To reflect auditing adjustments. 	$869
To reflect adjustments for fully depreciated plant. 	(1,356)
To reflect pro forma additions. 	186
Total 	($301)
TAXES OTHER THAN INCOME
To reflect appropriate test year RAF’s. 	$250
To reflect pro forma payroll tax increase (Document No. 05861-2023). 	269
Total 	$520
TOTAL OPERATING EXPENSE ADJUSTMENTS 	($1,481)

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 34
PINECREST UTILITIES, LLC 	SCHEDULE NO. 3-C
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
ANALYSIS OF WATER O&M EXPENSE
TOTAL 	STAFF 	TOTAL
PER 	ADJUST- 	PER
ACCT. # 	DESCRIPTION 	UTILITY 	MENT 	STAFF
601 	Salaries and Wages - Employees 	$16,421 	$3,463 	$19,884
603 	Salaries and Wages - Officers and Directors 	3,201 	795 	3,996
604 	Employee Pensions and Benefits 	4 	402 	406
615 	Purchased Power 	8,350 	(3,975) 	4,375
616 	Fuel for Power Production 	65 	0 	65
618 	Chemicals 	4,887 	(2,326) 	2,561
620 	Materials and Supplies 	5,421 	0 	5,421
631 	Contractual Services - Professional 	1,055 	0 	1,055
635 	Contractual Services - Testing 	2,750 	0 	2,750
636 	Contractual Services - Other 	8,908 	(1,093) 	7,815
640 	Rents 	2,049 	0 	2,049
650 	Transportation Expense 	2,561 	0 	2,561
655 	Insurance Expense 	8,004 	0 	8,004
665 	Rate Case Expense 	816 	509 	1,325
670 	Bad Debt Expense 	763 	525 	1,288
675 	Miscellaneous Expenses 	4,219 	$0 	4,219
Total O&M Expense 	$69,474 	($1,700) 	$67,774
Working Capital is 1/8 of O&M Less RCE 	$8,408

ORDER NO. PSC-2024-0100-PAA-WU
DOCKET NO. 20230071-WU
PAGE 35
PINECREST UTILITIES, LLC 	SCHEDULE NO. 4
TEST YEAR ENDED 12/31/2022 	DOCKET NO. 20230071-WU
MONTHLY WATER RATES
RATES 	COMMISSION-
PRIOR 	APPROVED 	COMM,. 	4-YEAR
TO 	INTERIM 	APPROVED 	RATE
FILING 	RATES 	RATES 	REDUC.
Residential and General Service
Base Facility Charge by Meter Size
5/8” x 3/4” 	$19.63 	$23.33 	$20.11 	$0.13
3/4” 	$29.45 	$35.00 	$30.17 	$0.19
1” 	$49.08 	$58.33 	$50.28 	$0.32
1-1/2” 	$98.15 	$116.65 	$100.55 	$0.64
2” 	$157.04 	$186.64 	$160.88 	$1.03
3” 	$314.08 	$373.28 	$321.76 	$2.06
4” 	$490.75 	$583.25 	$502.75 	$3.22
6” 	$981.50 	$1,166.50 	$1,005.50 	$6.44
Charge per 1,000 gallons – Residential and General
Service
$5.91 	$7.02 	N/A 	N/A
Charge per 1,000 gallons – Residential Service
0 – 5,000 gallons 	N/A 	N/A 	$9.86 	$0.06
Over 5,000 gallons 	N/A 	N/A 	$12.32 	$0.08
Charge per 1,000 gallons – General Service 	N/A 	N/A 	$10.34 	$0.07
Typical Residential 5/8” x 3/4” Meter Bill Comparison
3,000 gallons 	$37.36 	$44.39 	$49.69
6,000 gallons 	$55.09 	$65.45 	$81.73
10,000 gallons 	$78.73 	$93.53 	$131.01