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Saratoga County Water Authority - Ruling 6, May 23, 1995

Ruling 6, May 23, 1995


In the Matter
- of -
the Application of SARATOGA COUNTY WATER AUTHORITY for a Water Supply Permit pursuant to Environmental Conservation Law (ECL) Article 15, Title 15 and Title 6 of the Official Compilation of Codes Rules and Regulations of the State of New York (6 NYCRR) Part 601

RULING on Companies' Motion for Partial Summary Judgment

File No. 5-4100-22-1



Under cover letter of Usher Fogel, Esq., dated May 8, 1995 (received in the Office of Hearings May 9, 1995), Saratoga Water Services, Inc. (SWSI), and Luther Forest Corporation (LFC) (collectively, "the Companies") moved for an order

"(a) granting partial summary judgment finding that the Applicant will not make any material changes or improvements to the existing water system;

(b) in the alternative, ruling that whether the applicant had properly considered alternative sources of supply is an substantive and significant issue for adjudication in this proceeding; and

(c) for such other relief as the ALJ deems just and equitable."

Applicant's and DEC Staff's responses opposing the motion were received May 16, 1995.


The Companies state that their motion arises from information supplied by the Applicant during discovery. The Companies note that in his Interim Decision, the Commissioner stated:

"In this case, the Authority has requested the transfer of authority to operate the existing water supply system without any material changes. Therefore, it is unnecessary to examine any issue related to alternative water supply sources." (Interim Decision, pp. 1-2, emphasis added.)

The Companies argue that as a matter of fact and law, the Commissioner has already found that the Authority's proposed takeover of the Companies' system will not involve material improvements or changes to the operation of the existing system. The Companies note, however, that in response to a discovery request, Applicant indicated it would be offering testimony on the "proposed improvements to be made by The Authority relative to capital projects." [cit. om.]. The Companies contend that in view of the finding in the Interim Decision, the ALJ should issue a consistent ruling granting partial summary judgment that transfer of ownership will not involve any material changes or improvements to the operations of the existing system.

In the alternative, the Companies argue that the ALJ should rule that the issue of whether alternative supply sources have been properly considered should be adjudicated.


Applicant argues that summary judgment should not be granted or an issue added for adjudication; and that the testimony of the expert witnesses is needed on the issue of public necessity.

Applicant contends that the Companies' motion is an attempt to avoid full discussion of the merits of this particular application. Applicant cites language from the Interim Decision indicating that where only transfer of ownership is sought, the scope of regulatory review is limited to issues incident to the transfer. Applicant argues, in essence, that since we are dealing with an existing rather than new source of supply, the requirement to consider alternative sources does not apply.

Applicant notes that its proposed witnesses will testify to the operation and maintenance of the system by the Applicant, alternative valuations based on replacement costs and income capitalization, and the proposed improvements that will be made. Applicant intends to further use its expert witnesses on the issue of public necessity which involves economy of operation, improved service and improved reliability. Applicant contends that this testimony is relevant and is needed to demonstrate its position on public necessity, thus the motion should be denied.


Staff opposes the motion, essentially contending that the Commissioner's finding in the Interim Decision regarding "no material changes" being proposed related only to the proposed issue of alternative water supply sources. Staff argues that any intended improvement to the distribution system would be irrelevant to consideration of alternative sources of supply.

Staff argued that planned improvements to the existing water supply distribution system could be relevant to the public necessity issue if Applicant can show that they would result in better service to the users of the system. Staff contends that granting the motion would deprive Applicant of a fair hearing on the public necessity issue. Thus, Staff requests that the motion be denied.


The Companies' request for a ruling granting partial summary judgment that transfer of ownership will not involve any material changes or improvements to the operations of the existing system would be inconsistent with what Applicant has requested in its application. The "Joint Application for Permit" dated 6/18/92 under Item #13 "Project Description" states that "[t]he project consists of the acquisition of Saratoga Water Services, Inc., an existing approved private water works corporation by the Saratoga County Water Authority for public water supply purposes and improvements to the existing water system, including approximately 3,600 L.F. transmission main and additional water storage." Review of the "Application for Public Water Supply Permit" dated 6/18/92 under Item #3 indicates that the Applicant proposes to acquire existing facilities and install new facilities. Item #1 of that document essentially repeats the project description. Applicant, thus, applied not only to acquire an existing system, but to make certain improvements to it.

The Interim Decision cannot change the application. The portion of the Interim Decision relied on by the Companies related only to a proposed issue involving consideration of alternative water supply sources. The language cited by the Companies to support its motion must be viewed in that context, i.e., the Commissioner considered whatever changes were proposed to be immaterial relative to alternative sources. This doesn't mean that the proposed changes (improvements) would be immaterial relative to public necessity.

Granting the Companies' motion would either effectively change the application or take the Commissioner's statement in the Interim Decision out of context. Therefore, the Companies' motion must be denied.

However, both the Companies' motion, an implication by Applicant that the project is merely a transfer, and the unclear relationship between the numerous documents in the file and what constitutes the "application" under consideration, indicate a need to clarify the record on precisely what the application is for, before proceedings go much further. Since I will be contacting the parties to set up a conference on other matters (See Rulings of May 17 and May 19, 1995), I will add to the agenda clarification of the application with respect to the project being proposed.


The Companies' motion is denied. An on-the-record conference will be convened to clarify the application with respect to the project being proposed. The parties will be contacted shortly regarding setting up the conference.

Frank Montecalvo,
Administrative Law Judge
Albany, New York

Dated: May 23, 1995

To: Official Service List (5/10/95)

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