Illinois-American Water Co. v. Illinois Commerce Comm'n

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State: Illinois

Court: 2nd District Appellate

Docket No: 2-01-0746, 2-01-0752 cons. Rel

Case Date: 06/28/2002

Nos. 2--01--0746 & 2--01--0752 cons.

IN THE

APPELLATE COURT OF ILLINOIS

SECOND DISTRICT

ILLINOIS-AMERICAN WATER COMPANY,
as Successor in Interest to
Citizens Utilities Company of
Illinois, d/b/a Citizens Water
Resources,

Petitioner-Appellant,

ILLINOIS COMMERCE COMMISSION,

Respondent-Appellee.

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Petitioner for Review of an
Order of the Illinois
Commerce Commission.

ICC Docket No. 00--0194

NATIONAL ASSOCIATION OF WATER
COMPANIES, ILLINOIS-MISSOURI
CHAPTER,

Petitioner-appellant,

ILLINOIS COMMERCE COMMISSION,

Respondent-Appellee.

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Petition for Review of an
Order of the Illinois
Commerce Commission.

ICC Docket No. 00--0194

JUSTICE McLAREN delivered the opinion of the court:

Petitioners, Illinois-American Water Company, as successor ininterest to Citizens Utilities Company of Illinois, d/b/a CitizensWater Resources (Citizens), and National Association of WaterCompanies, Illinois-Missouri Chapter (Association), appeal adecision by respondent, Illinois Commerce Commission (theCommission), disapproving of an agreement between Citizens and adeveloper, Terra Cotta Company. We affirm.

Citizens was the original petitioner in case No. 2--01--0746. On February 19, 2001, we granted the motion of Citizens tosubstitute Illinois-American Water Company as the petitioner inthis proceeding. For reasons of simplicity and the accuracy ofhistorical fact, we will continue to refer to the petitioner incase No. 2--01--0746 as Citizens.

The following facts are taken from the record. Citizens is apublic utility that provides water and sewer service in sixcounties in northeastern Illinois. Terra Cotta is the owner anddeveloper of 1,400 acres to be developed with single-family homes,town homes, and a business park in Prairie Grove. On thisproperty, Terra Cotta built a 500,000-gallon elevated water storagetank, two wells, a well house and lift station, water and sanitarymains, and a 100,000-gallon-per-day water reclamation facility.

On February 16, 2000, Terra Cotta and Citizens entered into anagreement for the sale of Terra Cotta's water and sewer facilities. Citizens petitioned the Commission for a certificate of publicconvenience and necessity (certificate) to provide water andsanitary sewer services to a new development in McHenry County. The Commission granted the certificate. Citizens also requestedapproval of the agreement between it and Terra Cotta. Theagreement between Terra Cotta and Citizens provided that Citizenswould receive the water facilities for no money down and then wouldreimburse Terra Cotta for these facilities as new customers wereadded. However, regarding the sewer facilities, Citizens wouldreceive the existing facilities for approximately $1.4 million,without any reimbursement as new customers were added. Terra Cottaalso agreed to finance all future expansions of the sewagetreatment plant.

Under the Commission's regulations, when water service isextended to new customers, the utility is required to provide allwater supply (backbone) plants at its own cost and withoutcontribution from developers or customers. 83 Ill. Adm. Code