john n. hughes cases/2011-00443... · john n. hughes attorney at law professional service...
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JOHN N. HUGHES Attorney at Law
Professional Service Corporation 124 West Todd Street
Frankfort, Kentucky 40601
Telephone: (502) 227-7270 jnhughes@,fe)lfewpb.net
February 1,20 13
Jeff Derouen Executive Director Public Service Commission 21 1 Sower Blvd. Frankfort, KY 40601
FEB 1 2013
PUBL.IC SERVICE COM M ISS 101Y
Re: KY Frontier Gas Case No. 20 1 1-00443
Dear Mr. Derouen:
Attached are two updated responses to prior staff data requests-depreciation schedules and stock company consolidations previously filed in responses to items 12 and 16 respectively of the first data request to Kentucky Frontier Gas.
Please contact me if you have any questions about this matter.
%torney for KFG
Attachments
COMMONWEALTH OF KENTUCKY
BEFORE THE PUBLIC SERVICE COMMISSION
In the Matter of:
APPLICATION OF KENTUCKY FRONTIER GAS, LLC FOR APPROVAL OF CONSOLIDATION OF AND ADJUSTMENT OF RATES, APPROVAL OF AMR EQUIPMENT AND A CERTIFICATE OF CONVENIENCE AND NECESSITY FOR INSTALLATION OF AMR, PIPELINE REPLACEMENT
AND REVISION OF TARIFFS PROGRAM, REVISION OF NON-RECURRING FEES
) ) )
) ) 1
) CASENO. ) 2011-00443
SUPPLEMENTAL RESPONSE TO COMMISSION STAFF’S FIRST REQUEST FOR INFORMATION
Kentucky Frontier Gas, LLC. (“Frontier”), by counsel, files with the Commission
the original and seven copies of the following supplemental information
rankfort, KY 40601 Attorney for Frontier Gas Company, LLC
Supplemental response Item 12
Witness: Shute
See attached revised depreciation schedules.
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VI
16. Refer to Exhibit 6, Proposed Tariffs.
a. Given that Frontier has separate farm tap tariffs on file with the
Commission, explain why farm tap rates and tariff provisions are included as
part of its proposed gas utility tariff.
2) According to its Application, Frontier intends to have one set
of tariffs for all of its utility operations. Based on the nature of its
various acquisitions from 2008 to the present time, Frontier is
currently operating four different utilities: (1 ) Frontier, which
consists of all of the systems for which it acquired the utility’s
assets; and (2) Auxier Road; (3) Cow Creek and (4) Dema, the
three systems for which Frontier acquired the corporation’s
stock. Explain how Frontier envisions conducting business in
the future for the latter three utilities.
Witness: Shute
SUPPLEMENTAL RESPONSE:
Frontier originally expected to consolidate all three of the stock companies (Cow
Creek, Dema and Auxier Road) into Kentucky Frontier Gas, LLC. However, after a
review of the tax consequences of such a consolidation, Frontier determined that the
assets of Cow Creek and Dema should be transferred to Frontier and those two
companies dissolved, effective December 31, 201 2. Because of the unfavorable tax
liability that the Frontier members would have faced, Auxier was not included in the
consolidation. As a result of this action, Frontier will hold the assets of all of the
previously acquired companies, except Auxier. Those companies will operate as
Kentucky Frontier Gas, LLC with one rate and one tariff as proposed in the application
in this case.
Auxier Road Gas Company stock will remain wholly owned by Frontier and will
operate as Auxier Road Gas Company, d/b/a Kentucky Frontier Gas. The same rate
and tariffs for Frontier will apply to Auxier customers. Separate financial reports will be
maintained for Auxier.
Because this is a corporate reorganization among commonly owned entities
controlled by the same partners, Frontier believes no prior Commission approval was
required for this action pursuant to KRS 278.020 (7)(b).