USHER FOCEL - Government of New York

USHER FOCEL LAW OFFICE ATTORNEY AT LAW

557 CENTRAL AVENUE, SUITE 4A CEDARHURST, NY 1I516

BY ELECTRONIC MAIL

Hon. Jaclyn Brilling Secretary NYS Public Service Commission Three Empire State Plaza Albany, New York 12223

May 17,2011

TEL: 516.374.8400 X 108

FAX: 516.374.2600

CELL: 516.9673242

E-MAIL: [email protected]

Case No. 11-W - - Petition of Saratoga Water Services, Inc. Pursuant to Public Service Law, Section 89-f, for Authority to Issue and Sen Long Term Debt in an Amount Not to Exceed $1,389,500.

Dear Secretary Brilling:

Enclosed for filing with the Commission, please find the original Petition filed on behalf of Saratoga Water Services Inc. ("SWS") in the above-captioned matter.

The original SAP A form is also enclosed.

Thank you for your assistance in this matter.

Respectfully submitted,

cc: Alexander Mackay (by electronic mail)

STATE OF NEW YORK PUBLIC SERVICE COMMISSION

Case No. ll-W- Petition of Saratoga Water Services, Inc. Pursuant to Public Service Law, Section 89-f, for Authority to Issue and Sen Long Term Debt in an Amount Not to Exceed $1,389,500.

PETITION

Saratoga Water Services, Inc. by Alexander L. Mackey, President, pursuant to the Rules

and Regulations of the New York State Public Service Commission (PSC or Commission)

hereby petitions the Commission.

Identification of Petitioner

1. Alexander L. Mackey is the President of Saratoga Water services (Saratoga or

Company), a domestic transportation corporation providing water utility service to residential

and commercial customers residing in the Town of Malta, Saratoga county, State of New York.

Relief Requested

2. Saratoga requests that the Commission issue an Order pursuant to Public Service

Law Section 89-f authorizing the Company to issue and selllong-tenn debt in an amount not to

exceed $1,389,500 to The Adirondack Trust Company (Adirondack) in accordance with the

terms and conditions governing the long-term debt issuance as codified in the Commitment

Letter, dated April 19, 2011, a copy of which is annexed hereto as Exhibit "I"; to permit the

assets of the Company to be pledged and mortgaged to Adirondack as collateral security for

such long-term debt; and through its duly appointed officers, agents or employees, to execute all

documents and take all appropriate actions associated with and in furtherance of the issuance of

such long-term debt.

Factual Recitation

3. The NYS Department of Health (DOH) has directed Saratoga to construct and

install an additional supply production well--- Supply Well PW-9 ----to assure compliance with

the "Recommended Standards for Water Works". A copy of the correspondence from DOH

directing installation of PW -9 is annexed hereto as Exhibit 2.

4. In response thereto, Saratoga after discussion with its engineer and hydro-

geologist has developed an action plan detailing the steps that will be implemented to install the

new well. A copy of the November 11, 2010 letter from Lamont Engineers detailing the

implementation action plan is annexed hereto as Exhibit 3.

5. In addition, Saratoga has determined that installation of the new well reflecting all

related costs will total approximately $770,000. A copy of the total costing analysis is annexed

hereto as Exhibit 4.

6. Saratoga requires long term financing to support installation of this new well.

7. In Case No. 05-W-0154, the Commission authorized Saratoga to issue long term

debt in the amount $1,103,000 to Adirondack. There is currently a remaining principal balance

of approximately $619,500 on this loan In order the improve cash flow and take advantage of

2

the more beneficial interest rate climate, Saratoga also seeks to refinance the balance of this

existing loan.

8. The instant loan approval request is thus designed to provide initial financing for

installation of the new supply well PW-9 ($770,000), and refinance the existing long term loan

currently held with Adirondack ($619,SOO).

9. The purpose of this petition is to obtain approval of the long-term debt issuance

through Adirondack. The loan will be comprised ofthe following components:

411 An initial line of credit for a six month period of $770,000 at the rate of .S% over

the Adirondack Base lending Rate with interest only payments;

It After six months issuance of debt in the amount of $1,389 ,SOO for a1S year term

to close out the line of credit and consolidate the existing loan.

411 The long term loan will be fixed for five years at the rate of S.S% and then

adjusted to the Adirondack Base Lending Rate plus .S%.

III The loan will be secured by a first security interest in the assets ofthe Company, a

personal guarantee from the President of Saratoga, and pledging of additional

personal property.

It It is anticipated that the loan would close in December, 2011.

10. A copy of the original Certificate of Incorporation of Saratoga and Order of the

Commission in Case 98-W -0990 approving an amendment to the Certificate of Incorporation are

annexed hereto as Exhibit" S". The certificate authorizes two classes of stock of 179 shares of

the Class A voting stock has been issued.

3

11. Income statements and balance sheets for the years 2008-2010 are annexed hereto

as Exhibit "6". Copies of projected financial statements and cash flow for the period 2010-2014

are annexed hereto as Exhibit "7".

12. The cost and expenses of the proposed financing are estimated to be

approximately $15,000.

9. The proposed issuance of long-term debt for which authorization is now sought

from the Commission, has been approved by Saratoga. A copy of the resolution of the Board of

Directors and shareholders of the Company to this effect is annexed hereto as Exhibit "8".

10. The proposed long-debt loan debt issuance serves the public interest and is needed

to ensure and maintain the provision of safe and adequate utility service at just and reasonable

rates.

WHEREFORE, it is respectfully requested that the Public Service Commission issue an

Order pursuant to Public Service Law Section 89-f granting Saratoga Water Services, Inc.

authority to issue and sell long-term debt in an amount not to exceed $1,389,500 to The

Adirondack Trust Company in accordance with the terms and conditions of commitment letter,

dated April 19, 2001, together with the other relief requested herein.

4

Dated: Cedarhurst, N. Y. May 17,2011

Respectfully subIJi'~ted, 17 ,/") II? jr) j/ II

, / r)/ ,'fl", )/ /~ \J~fL-/,~e:f~~~ t~

Ush~r Fogel, E~q l~"/ \ Counsel for Saratoga Water Services, Inc. 557 Central Avenue, Suite 4A Cedarhurst, N. Y. 11516 Tel No. (518) 374.8400 x 308 E-mail: [email protected]

5

VERIFICATION

STATE OF NEW YORK ) ) 55.:

COUNTY OF SARATOGA )

Alexander L. Mackay, being duly sworn, deposes and says that deponent is the President of

Saratoga Water Services, Inc., the corporation named in the within Petition and knows the

contents thereof; that the same is true to deponent's own knowledge, except as to the matters

therein stated to be alleged on information and belief, and that as to those matters, deponent

believes it to be true.

Sworn to before me this f' of May, 7 2011

MICHAEL LOMAESTOO III ~ARY PUBUC STATE OF NEW"tOfIK

00. COMM,

COMMISSIONED IN SAflA'iOOA COUIIffY

Exhibit "1"

THE ADIRONDACK TRUST COMPANY 473 BROADWAY· SARATOGA SPRINGS. NY 12866-0326

April 19,2011

Saratoga Water Services, Inc. Alexander Mackay, President P.O. Box 2109 Malta NY 12020-8109

Dear Mr. Mackay,

I am pleased to inform you that we have approved the following credit accommodations as outlined below.

BORROWER:

AMOUNT:

PURPOSE:

ADVANCES:

TYPE:

RATE:

BANK FEE:

MATURITY:

REPAYMENT:

Saratoga Water Services, Inc.

$770,000

To put in a new production well.

Advances to be documented by a written request from borrower.

Line of Credit. To be converted to a fully amortizing 15 year term loan at the end of six months. (See Loan "2")

.5% (half percent) over The Adirondack Trust Company Base Lending Rate (floating).

Interest is computed on the basis of a 360 day calendar for the number of days the loan is outstanding (or in the billing period).

None

6 Months

Interest only.

518584-5844 - FAX 518 584-1107 'www.adirondacktrust.com

SECURITY:

GUARANTEES:

Loan #2:

a)

THE ADIRONDACK TRUST COMPANY

SARATOGA SPRINGS. N.V.

First security interest in inventory, accounts receivable, furniture, fixtures, and equipment.

b) Personal guarantee to be secured by a negative pledge and unfiled mortgage on 2 Stonebreak Rd. Malta NY.

Alexander L. Mackay

BORROWER: Saratoga Water Services, Inc.

AMOUNT: $1,389,500 (One million three hundred eighty nine thousand five hundred dollars and 0011 00)

PURPOSE: To term out line of credit, used to put in new production well referenced above and consolidate note # 288060.

TYPE: Term loan.

AMORTIZATION: (15) Fifteen years.

RATE:

BANK FEE:

MATURITY:

REPAYMENT:

SECURITY:

GUARANTEES:

Fixed for five years at 5.50% then adjusting to ATC base rate + .50%. ~

Interest is computed on the basis of a 360 day calendar for the number of days the loan is outstanding (or in the billing period).

1/4% on new money 0[$770,000 ($1,925)

(15) Fifteen years.

Principal and interest in an amount adequate to amortize the balance over 15 years.

a) First security interest in inventory, accounts receivable, furniture, fixtures, and equipment.

b) Guarantee to be secured by a negative pledge and unfiled mortgage on 2 Stonebreak Rd. Malta NY.

Alexander L. Mackay

2


SARATOGA SPRINGS. N.Y.

FINANCIAL COVENANTS:

OTHER:

a) Maintain a minimum debt service coverage ratio of 1.20x. Defined as earnings before interest, tax, depreciation and amortization less distributions divided by total debt service. (To be tested annually at FYE)

b) Limitation on future advances to related entities without bank consent.

c) Maintain a minimum Net Worth of$l ,750M. (To be tested annually at FYE)

a) The borrower shall execute a loan agreement which contains representations, warranties, covenants and conditions traditionally used by the Bank:.

b) For the life of the loan, provide the bank with the borrower's annual fiscal year-end financial statement prepared on a review basis within 90 days of fiscal year~end and, at the same time, current financial statements on all guarantors.

c) For the life of the loan, maintain fire and hazard insurance coverage in form and amounts acceptable to the bank: on the real estate and improvements, naming the bank as first mortgagee.

d) The loan for which you have been approved may not be assumed unless you obtain written approval from us. Any attempted transfer of any rights conferred by this loan is void, and you will remain liable for the payment under the loan.

e) This commitment will be automatically terminated should any of the information on your application or any other material you have supplied us change or prove to be inaccurate or misleading or should the value of the mortgaged property materially depreciate in value. Ifth1s commitment terminates under this Paragraph, we will have no obligation to make the loan.

f) Prior to closing, borrower to provide the bank with executed copies of construction contracts from the general contractor and any major subcontractors.

3


SARATOGA SPRINGS. N.Y.

g) Prior to any advance, borrower to provide the bank with a written request detailing the advance, accompanied by subcontractor invoices, in a manner acceptable to the bank.

h) Simultaneously, with each advance of funds, lien waivers may be required.

Please submit the following: 1) Copy of deed to 2 Stonebreak Rd., Malta NY 12020 2) Borrowing resolution and related documents authorizing aU aspect of this transaction 3) Proof of conformance with local zoning laws 4) Copies of existing leases for any portion of property to be mortgaged 5) Fire insurance policy and hazard insurance policy 6) Flood insurance. If this property falls within a flood designated area, we must receive an original flood insurance policy satisfactory to the bank or an application for such insurance, together with proof of payment of the first annual premium.

All terms and conditions of this commitment shall survive the loan closing and become part of the loan documentation.

This commitment is not assignable and shall expire on June 30, 2011. This commitment may be accepted by signing and returning the enclosed to the undersigned by May 15, 2011.

Please contact me at 584-5844 Ext. #2230 if you have any questions.

Thank you.

4

aZYours

,

Ed1u; P. Hart Vice President

THE ADIRONDAOK TRUST GOMPANY

SARATOGA SPRINGS, N.Y.

ACCEPTED: (-

~"'~ BY: ( .. d>Lj-Alexander ackay Date

Date

5

ST E OF NEW YORK DEPARTMENT OF HEALTH Flanigan Square 547 River Street Troy, New York 12180-2216 www.health.ny.gov

Nirav R. Shah, M.D., M.P.H. Commissioner

VIA ELECTRONIC MAIL

W. Richard Speidel Environmental Permits, Region 5 New York State Department of Environmental Conservation

P.O. Box 220 Warrensburg, NY 12885-0220

Dear Mr. Speidel:

February 15, 2011

RE: WSA #11,471; DEC #5-4140-00038/00022 NYS DOH Recommended Approval of WSA Affordable Storage Development Saratoga Water Services - PWS ID#: NY4511620 (T) Malta, Saratoga County

The New York State Department of Health (NYSDOH) has reviewed the Water Supply Application for the above referenced project. The application was received in this office on February 10, 2011. It is our understanding that the project involves the expansion of water services by the Saratoga Water Services (SWS) to the proposed Affordable Storage Development in the Town of Malta. The project will involve the installation of approximately 872 lineal feet of lO-inch PVC water main and 120 lineal feet of 6-inch water service lateral and 48 lineal feet of %-inch water service lateral, along with hydrants, valves, and appurtenances. The average water demand for the project is estimated to be approximately 330 gallons of water per day (gpd), to be supplied from the Knapp Road Well Field and Cold Spring Well Field.

Based upon our review of the application materials, we recommend approval of the application with the following conditions:

THAT the Saratoga Water Services (SWS) Plan of Action and Water Conservation Measures are carried out as detailed in the respective November 11, 2010 and June 9,2010 letters submitted by SWS to the NYS DOH, including immediate implementation of select activities when any corresponding trigger points described therein are observed; and

THAT the Saratoga Lake Golf Course irrigation system be under the physical control of SWS and efficiently managed by SWS in a manner that conserves water and minimizes the potential for disruption of residential water services; and

THAT the source capacity, as detailed in Recommended Standardsfor Water Works 3.2.1, will at all times equal or exceed the maximum daily demand with the largest producing well out of service; and

P:\Sections\Design\EASTERN\( 45) SARATOGA\Saratoga_ Water_Services\ WSA 11471_DOH Rec Approval.doc

Mr. Richard Speidel February 15, 2011 Page 2 of2

THAT approval of final plans and specifications for the water main extension shall be obtained from the NYS DOH - Glens Falls District Office prior to commencing construction; and

THAT the new water services for the Affordable Storage Development shall not be connected until the equipment for the SCW A emergency interconnection is procured.

If you have any questions, please contact our office at (518) 402-7676.

ecc: K. Sayers, NYSDOH - CRO K. Wheeler! A. Koonsman, NYSDOH - GFDO R. Streeter, NYSDEC - Region 5 M. Harrington, Lamont Engineers

Sincerely,

:er~<-L y-Brock Rogers, P.E. Public Health Engineer 2 New York State Department of Health Bureau of Water Supply Protection

P:\Sections\Design\EASTERN\(45) SARATOGA\Saratoga_ Water_Services\WSA 1 147 I_DOH Rec Approval.doc

S TE OF NEW YORK DEPARTMENT OF HEALTH Flanigan Square 547 River Street Troy, New York 12180-2216

Richard F. Daines, M.D. Wendy E. Saunders Commissioner Executive Deputy Commissioner

VIA ELECTRONIC MAIL

W. Richard Speidel Division of Environmental Permits Region 5 New York State Department of Environmental Conservation

232 Golf Course Road Warrensburg, NY 12885-0220

Dear Mr. Speidel:

January 25, 2010

RE: WSA #11,333; DEC #5-4140-00038/00016; Endorsement of WSA Malta Mobile Acres Saratoga Water Services - PWS ID#: NY45 1 1620 (T) Malta, Saratoga County

The New York State Department of Health (NYS DOH) has reviewed the Water Supply Application for the above referenced project. The application was received in this office on November 19,2009. The project involves the expansion of the Saratoga Water Services (SWS) service territory to encompass the existing I21-unit Malta Mobile Acres mobile home park, which is currently served by wells that have been determined to be under the direct influence of surface water. The project consists of extending a lO-inch water main approximately 430 feet from an existing water main to Malta Mobile Acres, where a 4-inch service line will be provided to the site.

Since the source of water at Malta Mobile Acres is vulnerable to contamination due to its GWUDr classification, the NYS DOH supports the connection of Malta Mobile Acres to SWS. However, the Recommended Standards for Water Works requires that the total developed groundwater source capacity for community water systems equal or exceed the design maximum day demand (MDD) with the largest producing well out of service. Based on materials provided in the application and in NYS DOH files, SWS may not have sufficient developed source capacity to meet this requirement at full build-out without temporary suspension of its non-community/seasonal service commitments (e.g., Luther Forest Tech Park construction activities or the Saratoga Lake Golf Club). For this reason, the SWS should develop additional source capacity (e.g., install proposed supply well PW -9), and future SWS water supply applications should include a detailed schedule for developing such capacity.

Based on the foregoing, the DOH has no objection to DEC issuing the requested water supply permit at this time with the following conditions:

THAT final plans and specifications for the proposed water facilities be approved by the DOH Glens Falls District Office; and

P:\Sections\Design\EASTERN\Saratoga\Saratoga_ Water_Services\ WSA I 1333 _end.doc

Mr. Richard Speidel January 25,2010 Page 2 of2

THAT the water district boundaries be provided in digital format. GIS format is preferred, particularly ESRI or Maplnfo. CAD file formats such as AutoCAD's DWG are also acceptable. Such files may be sent via e-mail [email protected].

The applicant should also be aware that without adequate documentation that the requirements of Recommended Standards for Water Works can be fully met, future SWS requests for water service area expansion may not be approved unless additional source capacity is developed.

If you have any questions, I may be reached at (518) 402-7676.

ecc: K. Sayers, NYS DOH - CDRO

Sincerely,

ff,--j. y Brock Rogers, P.E. Senior Sanitary Engineer New York State Department of Health Bureau of Water Supply Protection

K. Wheeler! A. Koonsman, NYS DOH - GFDO M. Shaw, NYS DOH - GFDO R. Streeter, NYS DEC M. Harrington, Lamont Engineers

P:\Sections\Design\EASTERN\Saratoga\Saratoga_ WatecServices\ WSA 11333 _end. doc

Exhibit "3"

mont gineers ENGINEERS. PLANNERS. FACIUTY OPERATIONS

lJed0u:ed to. Sewice . .. ~d to. &~

November 11, 2010

Me William Gilday, PE NYSDOH BPWS Flanigan Square 547 River St., 4th Floor Troy, NY 12180

Re: Saratoga Water Services, Inc. Maximum Day Demand and Source Capacity Analyses Revised Plan of Action - SCWA Emergency Connection Added

Dear Mr. Gilday:

Saratoga Water Services (SWS) hereby modifies its Plan of Action to attain Source Capacity in compliance with ''Ten States Standards", which requires that Maximum Day Demand be met with the largest producing well out of service. The revised schedule is presented below (new/modified items in bold):

Action Item

Commence Water Conservation Measures

Replace PW-7 Well Pump and Drop Pipe

Replace PW-8 Well Pump and Drop Pipe

Commence Design of PW-9 and Piping Connection

Procure Equipment for Emergency Connection with SCWA

Commence Construction of PW-9

Submit Plans and Specifications to DOH for Approval

Submit Water Supply Application to DEC

Start-up and Operation of PW-9

PO Box 610 l.eskilt, NY 12043

Tet: 51S-234-4028 Fax: 518-234-4613

www.lamonteng!neers.com lamonl@lamontengln8Ilfs,com

Completion Date

T rigger Point

June 30, 2010

August 31,2010

November 1, 2010 (or Trigger Point)

December 31,2010

August 1, 2011

October 15, 2011

October 15, 2011

December 15. 2011

o PO Bo)( 486 Roxbury, NY 12474

Tel: 607-326-3341 Fax: 607-326-3346

Obtain weekly data from interruptible services (starting now)

Update Water Demand Analysis Table quarterly based on actual build-out of developments

Establish Trigger Points for Future Upgrades (Well Pumps and Booster Pumps)

December 15, 2011

December 15, 2011

March 1, 2012

Once this Revised Plan of Action is approved by NYSDOH, we trust that SWS's compliance with the Plan of Action will result in unencumbered approval of reasonable Water Supply Applications while SWS increases its Source Capacity.

Should you have any questions or require additional information, please call.

Michael D. H rrington, P.E. Principal Engineer Lamont Engineers

Cc: Alec Mackay, SWS Jean Marcotte, SWS Aaron Koonsman, NYSDOH Glens Fails Brock Rogers. NYSDOH Troy Erik Schmitt, NYSDEC Albany Rob Streeter, NYSDEC Warrensburg Richard Speidel, NYSDEC Warrensburg

S:/SWS/OOBI

Exhibit 114"

Saratoga Water Services, Inc Production Well #9 (PW9) Cost Estimates 1400 gallon per minute (2.0 MGD)

Site Work Site preparation and Erosion Control 10" Transmission Pipe Installation Connection to Exisiting Pipe Building Modifications (8' stud wall)

Hydrogeologic Tasks Test Well Installation Production Well Installation Aquifer Pumping Test Aquifer Pumping Test Test Analysis Reports

Controls VFD, Well Transducer, Well Transmitter Box, Field Service

Pump Installation MobilizationlDemobilization Drop Pipe Pump/Motor Cable Misc. Fittings (incudes check valves) Pitless(lnciudes excavation) Hydrogeologist Supervision

Electrical Improvements Cabling and Wiring from Master Control Center to PW9 Manual Transfer Switch and plug for PW8 and PW9 Wiring PW8 for Emergency Power Contois Programming Control Wiring and VFD Installation

Subtotal Costs

Contingency at 10%

Permitting Engineering Construction Services

Grand Total

Costs $2,000 $6,000 $6,000 $1,000

$63,775 $337,000 $83,375

$5,500 $5,500

$14,650

$1,220 $10,270 $22,735

$8,165 $5,955

$36,715 $4,500

$11,000 $10,000 $10,000 $4,000 $4,000

$653,360

$65,336

$5,000 $41,304

$5,000

$770,000

Exhibit ((5"

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( )

OF MALTA STATE OF NEW YORK·

-~-------------------------------------------------

In the Hatter of the Application of WILLIAM IL MACKAY, proposed incorporator

for

Consent of the Town Superintendent of Highways and a majority of the members of the Town Board of the Town of Malta for the formation of a transportation corporation pursuant to Section 41 of the Transportation Corporations Law of the State of New York

CONSENT TO THE FORMATION OF SARATOGA WATER SERVICES, INC.

13 Grant Ave., Glens Falls, NY A TRANSPORTATION CORPORATION

We, the undersigned, the Town Superintendent of High~iiays and a majority

of the members of the Town Board, in the Town of Malta, County of Saratoga, State

of New York, do hereby consent to the formation of a water-works corporation

under the provisions of Articles 1 and 4 of the Transportation Corporations Law

of the State of New York, for the purpose of supplying a portion of the Town

of Malta, said portion more particularly described in the Certificate of .

Incorporation, with water, and we consent to the filing of the annexed certificate

of incorporation of the Saratoga Water Services, Inc.

this

IN WITNESS WHEREOF, we

)() \}.Alay of lvllll~c H·· have made and subscribed this consent in triplicate,

, 1978.

Town peri tendent of Highways, TOvffi of Malta, County of Saratoga State of New York

A Majority of the Members of the Town Board of the Town of Malta,

County of Saratoga, State of New York

STATE OF NEW YORK PUBLIC SERVICE COMMISSION

COMMISSIONERS PRESENT:

Maureen O. Helmer, Chairman John B. Daly Thomas J. Dunleavy James D. Bennett

At a session of the Public Service commission held in the City of

Albany on October 21, 1998

CASE 98-W-0990 - Petition of Saratoga Water Services, Inc., for Approval of a Plan of Corporate Reorganization.

ORDER APPROVING AMENDMENT TO CERTIFICATE OF INCORPORATION OF SARATOGA WATER SERVICES, INC.

(Issued and Effective December 2, 1998)

BY THE COMMISSION:

Saratoga Water Services, Inc. (Saratoga Water or the

company) filed a petition dated June 15, 1998, pursuant to

Section 89-g of the Public Service Law (PSL) requesting

Commission authority to permit it to reorganize by amending its

Certificate of Incorporation to increase the number of authorized

shares of voting common stock to 500, and to authorize the

issuance of 9,500 shares of non-voting comrnonstock.

When incorporated in 1978 in New York State as a

waterworks corporation, Saratoga Water was authorized to issue

200 shares of voting common stock. The sole shareholder,

Al~xander L. Mackay, currently holds 178 shares of the issued and

outstanding shares; 22 shares have not been issued. The company

supplies water to inhabitants of the Town of Malta and the. Town

of Stillwater in Saratoga County. The company had sales of about

$626,000 in 1997 and $572 1 000 in 1996.

Th~ comp~~y seeks to reorganize by amending its

certiticate of inco+,poration to authorize the issuance of 500

shq~es o~ votip9 ~oromo~ stock t without par value, and 9500 shares

of non-voting cQ~on $tQ~kf witnout par value. The shareholder's

178 stl.~res of voting c.:~:mmon stock will be exchanged for 5000

CASE 98-W-0990 j

shares of common stock consisting of 500 shares of Class A voting

shares and 4500 shares of Class B non-voting shares. The 22

shares of common stock, which are presently unissued, will be

changed into 5000 shares of Class B non-voting common stock. The

shareholder may transfer, by gift, shares of the voting and/or

non-voting common stock to his spouse and issue, or trust(s) for

their benefit. The company seeks to reorganize to provide for

the orderly succession of management and ownership of the company

in the event of the sole shareholder's disability, incapacity,

incompetency, or death.

Section 108(1) of the PSL prohibits the delivery to,

and the filing by, the Department of State of a Certificate of

Amendment of a Certificate of Incorporation that makes any

amendment specified in Sections 801(b) (8)-(12) of the Business

Corporations Law (BCL), "unless such certificate shall have

endorsed thereon the consent and approval of the Commission.""

Several of the amendments that appear in the company's

Certificate of Amendment are specified in the portions of BeL.

The proposed reorganization of Saratoga Water does not

have a negative impact on ratepayers or the operation of the

company, and as the company states, provides for the orderly

succession of management and ownership of the corporation. It

also appears that the company requires approval under PSL Section

108(1) as well as Section 89-g.

The Commission orders:

1. The proposed certificate of amendment is approved,

pursuant to Section 89-g and 108(1) subject to the condition that

it be executed substantially in the form attached to the petition

of Saratoga Water Services, Inc. dated June 15, 1998.

2. The Secretary of the Public Service Commission is

directed to endorse this consent and approval upon the

certificate when executed or to attach to the certificate such

consent and approval.

3. The consent and approval of the Commission to the

certificate of amendment may be revoked without further notice,

-2'-

CASE 98-W-0990

if the certificate approved in this Order is not filed with the

Secretary of State within 90 days from the date of service of

this Order.

4. Within 10 days after filing the certificate of

amendment with the Secretary of State, Saratoga Water Services t

Inc. shall file verified proof of such filing with the Secretary

of the Public Service Commission.

5. Upon the filing of the verified proof described in

Ordering Paragraph 4, this proceeding will be closed.

(SIGNED)

~3-

By the Commission t

DEBRA RENNER Acting Secretary

Exhibit "6"

3:40 PM

05/16/11 Accrual Basis

SARATOGA WATER SERVICES, INC. Profit & Loss

January through December 2010

Jan - Dec 10

Income FINANCE CHARGES INTEREST INCOME METERED SALES MISC WATER REVENUES SURCHARGE

Total Income

Expense AMORTIZATION EXPENSE ACCOUNTING FEES BANK CHARGES CREDIT CARD DISCOUNT DEPRECIATION DUES & SUBSCRIPTIONS GENERAL OFFICE EXPENSE INSURANCE

Health Insurance Other Liability Disability Work Comp Vehicle

Total INSURANCE

INTEREST EXPENSE NOTES 2005 Mort I nt Expense # 274110 2006 Bond Refin Int Exp #285 ... 2006 Mort Int Exp #288060

Total INTEREST EXPENSE

LEGAL FEES MAINT. MATERIALS & EXPENS ... NYS CORP TAX OPERATING TAXES PAYROLL EXPENSES Payroll fees PAYROLL TAXES Professional Fees POWER PURCHASED PURIFICATION SUPPLIES REAL ESTATE EXPENSES RENTS RETIREMENT EXPENSES SHOP & LAB EXPENSE TELEPHONE EXPENSE VEHICLE EXPENSE VEHICLE LEASE

Total Expense

Net Income

3,366.28 17.79

807,046.55 2,240.00

35,421.24

848,091.86

211.51 4,200.00

614.23 1,898.38

102,197.78 490.00

14,712.02

13,3'10.03 793.40

6,386.91 52.32

2,661.65 1,442.90

24,647.2'1

9,819.91 4,411.11

10,873.72 35,080.43

60,185.17

28,795.00 49,972.12

300.00 5,712.20

180,290.65 214.40

13,820.59 37,740.40 62,336.93 15,871.56 55,543.08 24,817.15 10,799.43 2,809.25 4,909.25

15,948.11 13,200.00

732,236.42

115,855.44

Page 1

3:40 PM


SARATOGA WATER SERVICES, INC.

As of December 31, 20'10

ASSETS Current Assets

Checking/Savings A TC - Checking Saratoga Water Srvs Sure!large Savings(Deposit Escrow} Property Tax Savings CAPITAL SAVINGS ACCOUNT

Total Checking/Savings

Other Current Assets ACCOUNTS RECEIVABLE

Total Other Current Assets

Total Current Assets

Fixed Assets FIRE PROTECTION/ORIGINAL COST LAND MAINS/ORIGINAL COST METERS10RIGINAL COST OFFICE EQUiPMENT/ORIGINAL c.., POWER & PUMPING/ORIGINAL C." SERVICES! ORiGINAL COST STRUCTURESfORIGINAL COST WELLS/ORIGINAL COST ACCUMULATED DEPRECIATION

Total Fixed Assets

Other Assets CIAC 2006 Bond Refinance Costs 2006 Bond Refin Accum Amort NOTES RECEIVABLE ORGANIZATION ORGANIZATION/ACCUMULATED"

Total Other Assets

TOTAL ASSETS

LIABILITIES & EQUITY Liabilities

Current Liabilities Other Current Liabilities

Customer Deposits ACCOUNTS PAYABLE ACCRUED INTEREST PAYABLE ACCRUED NYS CORP TAX NOTES PAYABLES

Une of Credit - #309920 Une of Credit #288050

Total NOTES PAYABLES

Dec 31,10

1,090.71 2,806,94

408.64 115.36

18,021.42 " .. -.-.. ~~---~----. -.

22,443.07

15,550.10

15,550.10 ", .. , ... ,"'''''''''''' """''''',

37,993.17

50,378.47 111,832.85

1,587,755.38 342,673.75

22,854,00 424,258.06

856,468.18 370,947.36

-1,596,030.10

=c==-=:-.

2,650,212.37

567,444.90 4,228.75

-1.056.02 70,106.55 51,959.79

-51,959.79

640,724.18

3,328,929.72

375.00 684.31

3,892.68 30000

68,327.56 100,714.00

169,041.56

Page 1

3:40 PM

05/16/11 ACCfllalBasis

SARATOGA WATER Balance

As of December 31, 2010

PAYROLL LIABiLITIES

Total Other Current Liabilities

Total Current Liabilities

Long Term Liabilities 2005 Consolidation Loan #274110 2006 Bond Refinance #285100 2006 Mortgage #288060

Total Long Term Liabilities

Total Liabilities

Equity COMMON STOCK PAID IN CAPITAL RETAINED EARNINGS Net income

Total

TOTAL LIABILITIES & EQUITY

INC.

Dec 31, 10

179,718.80

62,229.02 135,694.03 636,295.23

834,218.28

1,013,937.08

1,358,563.10 734,500.39 106,073.71 115,855,44

2,314,992.64

2

3:39 PM


SARATOGA WATER SERViCES, INC. Profit & Loss


Jan - Dec 09


Total Income


Other Liability Disabtlity Work Comp Vehicle

Total INSURANCE

I NTEREST EXPENSE NOTES 2005 Mort Int Expense # 274110 2006 Bond Refin Int Exp #285 ... 2006 Mort Int Exp #288060


LEGAL FEES MAl NT. MATERIALS & EXPENS ... NYS CORP TAX OPERATING TAXES PAYROLL EXPENSES Payroll fees PAYROLL TAXES Professional Fees POWER PURCHASED PURIFICATION SUPPLIES REAL ESTATE EXPENSES RENTS RETIREMENT EXPENSES SHOP & LAB EXPENSE TELEPHONE EXPENSE VEHICLE EXPENSE VEHICLE LEASE

Total Expense

Net Income

3,715.97 4009

731,437.85 1,769.70

36,379.77

773,343.38

211.51 2,000.00

534.87 1,690.68

101,103.69 1,110.00

17,090.74

1,010.01 6,020.19

0.51 2,615.26 1,372.52

11,018.49

8,480.62 6,745.51

12,464.40 39,843.84

67,534.37

18,750.00 24,054.04

299.90 5,672.04

182,898.27 208.50

14,846.29 55,242.12 60,959.80 11,109.75 54,412.01 22,548.69 '17,167.36 4,994.25 5,279.63

14,62656 14,200.00

709,563.56

63,77982

Page'1

3:40 PM



ASSETS

Balance Sheet As of December 31, 2009

Current Assets Checking/Savings

A TC - Checking Saratoga Water Srvs Surcharge Savings(Deposit Escrow) Property Tax Savings CAPITAL SAVINGS ACCOUNT





Fixed Assets FIRE PROTECTION/ORIGINAL COST LAND MAINS/ORIGINAL COST METERS/ORIGINAL COST OFFICE EQUIPMENT/ORIGINAL C POWER & PUMPING/ORIGINAL C SERVICES/ ORIGINAL COST STRUCTURES/ORIGINAL COST WELLS/ORIGINAL COST ACCUMULATED DEPRECIATION

Total Fixed Assets

Other Assets CIAC 2006 Bond Refinance Costs 2006 Bond Refin Accum Amort NOTES RECEIVABLE ORGANIZATION ORGANIZATION/ACCUMULATED ...

Total Other Assets

TOTAL ASSETS

LIABILITIES & EQUITY Liabilities

Current liabilities Other Current liabilities


Line of Credit - #309920 Line of Credit #288050


Dec 31,09

4,072.70 3,139.06

332.75 115.08

1,212.96 . ,--- ,,_.,,> .~-,,~ .. -- .. ~ •. ~.~ -_. ---~-.

8,872.55

13,830.41

13,830.41

22,702.96

50,378.47 111,832.85

1,587,755.38 322,249.91

22,854.00 424,258.06 479,074.42 856,468.18 370,947.36

-1,493,832.32

2,731,986.31

557,000.00 4,228.75 -844.51

138,856.55 51,959.79

-51,959.79

699,240.79

3,453,930.06

300.00 11,721.94 4,503.70

300.00

101,159.93 125,240.00

226,399.93

Page 1

3:40 PM


SARATOGA WATER SERViCES, INC. Balance Sheet


PAYROLL LIABILITIES

Total Other Current Liabilities



Total Long Term Liabilities

Total Liabilities

Equity COMMON STOCK PAID IN CAPITAL RETAINED EARNINGS Net Income

Total Equity

TOTAL LIABILITiES & EQUITY

Dec 31,09 -_._._----.-_ ...

4,883.21

248,108_78

248,108.78

106,014.95 159,106.30 685,076.99

950,198.24

1,198,307.02

1,358,563.10 690,684.39 142,595.73 63,779.82

2,255,623.04

3,453,930.06

Page 2

3:39 PM

05/16!11 Accrual Basis

SARATOGA WATER SERVICES, INC. Profit & Loss


Jan - Dec 08


Total Income


Other Liability Disability Work Comp Vehicle

Total INSURANCE

INTEREST EXPENSE NOTES 2005 Mort Int Expense # 274110 2006 Bond Refin Int Exp #285 ... 2006 Mort Int Exp #288060


LEGAL FEES MAINT MATERIALS & EXPENS ... NYS CORP TAX OPERATING TAXES PAYROLL EXPENSES Payroll fees PAYROLL TAXES Professional Fees POWER PURCHASED PURIFICATION SUPPLIES REAL ESTATE EXPENSES RENTS RETIREMENT EXPENSES SHOP & LAB EXPENSE TELEPHONE EXPENSE VEHICLE EXPENSE VEHICLE LEASE

Total Expense

Net Income

3,291.77 54.16

749,551.65 8,412.90

33,759.39

795,069.87

211.00 2,000.00

616.52 1,109.67

100,307.98 1,258.00

17,452.01

642.17 5,521.18

-2.88 3,653.56 1,253.83

11,067.86

10,334.58 10,550.87 14,057.40 45,477.99

80,420.84

16,005.78 25,144.53

300.00 2,268.87

172,872.16 211.47

13,095.08 37,583.85 72,433.08

6,359.11 57,026.28 25,372.15 16,952.99

5,984.00 4,669.75

21,316.26 13,000.00

705,039.24

90,030.63

Page 1

3:40 PM



ASSETS

Sheet As of December 31, 2008

Current Assets Checking/Savings

ATC - Checking Saratoga Water Srvs Savings(Deposit Escrovv) Property Tax Savings CAPITAL SAVINGS ACCOUNT





Fixed Assets FIRE PROTECTION/ORIGINAL COST LAND MAINS/ORIGINAL COST METERS/ORIGINAL COST OFFICE EQUIPMENT/ORIGINAL C. POWER & PUMPING/ORIGINAL C ... SERVICES! ORIGINAL COST STRUCTURES/ORiGINAL COST WELLS/ORIGINAL COST ACCUMULATED DEPRECIATION

Total Fixed Assets

Other Assets CIAC 2006 Bond Refinance Costs 2006 Bond Refin Accum Amort NOTES RECEIVABLE ORGANIZATION ORGANIZATION/ACCUMULATED ..

Total Other Assets

TOTAL ASSETS

LIABiLITIES & EQUITY Liabilities

Cummt Uiilbilitl@~ Other Current Liabilities


Line of Credit #288050


Dec 31,08

181.99 7,002.90

22,193.53

36,767.46

14,37429

14,37429

51,141.75

42,050.00 111.832.85

1,478,715.85 312,756.55

22,854.00 424,258.06 479,074.42

8 370,947.36

-1,392,728.63

2,706,228.64

332,000.00 4

-633.00 147,856.55

51,959.79 -51,959.79

.. ~ ~ - -.---~. --"",, +-~-~------

483,452.30

150.00 22,316.35

300.10

145,400.00

145,400.00

Page 1

3:40 PM


SARATOGA WATER SERVICES, INC. Balance Sheet


PAYROLL LIABILITIES

Total Other CurTent Liabilities



Total long Term Liabilities

Total Liabilities

Equity COMMON STOCK PAID IN CAPITAL RETAINED EARNINGS Net Income

Total Equity

TOTA.L LIABILITIES & EQUITY

Dec 31,08

5,192.16 . --- ._ ... .... --."--... ~ .. -----

178,897.03

178,897.03

147,485.88 180,027.56 728,004.22

1 ,055,517.66

1,234,414.69

1,358,563.10 443,524.39 114,289.88 90,030.63

2,006,408.00

3240,822.69

Page 2

Exhibit {{7"

Saratoga Water Services, Inc. 1 ~ .. __ . i 1___ I 1 _11-+1 ____ --1

Balance Sheet Pro Forma - Production Wei! #9 Financin9J JJ ~ I I i . , 1 i ' 1 11------

r-----~_=_-__ -".~=~============ _ _=__=__=~_~_:~~--:A:S;=O-f-:_-_:_:-:_!_-h---Aso-f ~t- As of i As of'l As of 12/31/20101 i 12/31/20111 12/31/2012 i 12/31/2013 i 12/31/2014

I It I i I -----~~.-------+-----.-H_--.-++- ~----_+I--f;-------

!----_c_u--:rr:-:-e_nt_A-c-s_se-c-t::-s_-,-______ ---+I _____ +-i +, ___ -----!-l--~--T-(----- i ____ _

_____ C ___ h_e_c_k~in~g~/S~a-Vi~n~gS------_-+II-~--1~L. ! iii I I ATC-Checking =-----c--_----i._----:$:-1-'-,0_9--j11 .. 1 $53,090,. $81,174 I $150,6111 I $220,617

r--------- Saratoga Water Ser Surcharge $2,807 i J $2,8071' I $2,807 I $2,807 i $2,807 Savings - Deposit Escrow I $4091 ! $409, I $409 i $409 $409

f----·----.::Pc-ro-p----'e"'rtC'y--=Ta-x-'-S:::-a-v7in-g-s-----+1 ---$=-1c'C1=5+-1 +1 -.- $115 i I $115: I' $115 1 L $115

Capital Savings Account I $18,02fl 1 $2,0211 I $2,021 i' $2,0211 -----c$-c'-2,-c-0-:--21c4

I ! I 1 I

Assets

___ T_ot_a_1 C_h_e_C_ki~ng~/_Sa_V_in-"g'-S ____ + __ $_2_2_'_,4_4311 $58'4~421 1_$86,526 $155,9631 $225,969

I __ ~~~_--:--:~----: ____ ---+I ___ ~I~ ---- I i ---~! +-------Other Current Assets I . J+ I

Accrued Interest Payable I it- -$3,893 -$3,893i[ -$3,8931 I -$3,893 !----___ A_c_co_u_n_ts_R __ e_c_ei_va_b_le ____ -+-_$.c.-1_5.:..,5 __ 5QU $15,550 $15,550 I 1 $15,550 I I $15,550

I I I ' 1 L ':,' i ! I I ' I i -------:T=-o-,-ta--=I-=O:-ccthC-e-r-=C,--ur·-re-n--C-t =A-ss-e·-c-ts-----1I----=-$17-:5=-, 5=5:cc.O-tL $11,6571 L -=-$1-:-1=-,6=-=5=7+, -t,--$::c-1c-:1--:,6=-=5=7T-

1

-t!----=-$1-:-1=-,6=-=5=i7

I!I

I I I i I ! i $167,62011 I, r----_T_o_ta_1 C-,---ur_re:....n._t _A_ss_e-'ts'---______ -+. __ $ ..... 3_7-'-, 9-,-9_3.:._ LL_JJO, 099l_il~_---'-$9.:..:.8'_'_, 1_8 __ 3+1 --fi_-"----'--'-_+--f_-'-$_23_7 ___ ,6_2--16

-.---.-------------+----- i~------+-~- .1 II --t1-11------l

I lJ. ! \

Fixed Assets -I,+-- i-~I----rr-----I--I +1 ----------.::::F-:-ire--=pr-o-:-te-c-c-:-tio-n--------+I,I, ---=$=5=0-=,3=7-::-18 1 I . ~50,378 i I $50,378 1 i --$-5-0-,3-7-8 i--

1

+1--$-5-0-,3-7-81

Land $111,8331 I $111,8331 I $111,8331 I $111,833: I $111,833 ~---~~---------------~~c~~__f-!____~--'--~~---'--~~~~~!--' +-~,~~~I

Mains $1,587,7551 I $1,587,7551 II $1,587,755 $1,587,7551 $1,587,755 i--.----c-:-----.----- .

Meters $342,6741 I $352,674\ $362,6741 II $374,674 ' $386,674 Office Equipment I $22,8541 I $22,854 I $22,8541 $22,8541 $22,854

------=---~~~--------------+--~~~.

Power & Pumping II $424,2581 i $424,258 $424,2581 $424,258 $424,258 Services $479,0751 I $479,0751 1 $479,075 '--:$:-C4=7-=-'9,'-=-0=75::-i'--+-$=-4=7=9'-::,0=75c:-1

c--"

1-----

Structures $856,4681 $856,468 I $856,4681 $856,468 i 1 $856,468 ------

1 __ --:W_e::...:.l1:.=-s~--c--:-=-~~------+---:--:'-$3=-7::-':0-'-,9=-:4.:.::.7+-1 +-:$1,140,9471 $1,140,947 $1, 140,947[ $1,140,947 Accumulated Depreciation -$1,596,030ll-$1,711,318 1-$1,865,106, -$2,018,8941 ,-$2,172,682

---T-o-t-a-I F-ix-e-d-A-s-se-t-s-'---------+-$'--2.c...,6-5-=-0c..:.,2-=-1-'-2t: $3,314,924[ i $3,171,1361 I $3,029,348

1

1

1 $2,887,560

Ii i r I I ,I II 1

, I ' : .

2006 Bond Refin Costs 1 $4,2291 i $4,229 I $4,229 I $4,229 $4,229 2006 Bond Refin Accum Amort I -$1,056[] -$1,2681 -$1,480 -$1,692 I -$1,904

___ CIAC ~ $567,4451 $567,445 $567,445 i $567,445 I $567,445 I I I I

Total Other_A_s_s __ e __ ts ________ ~II-$"--6-4-0'--, 7_25__f1,----i1f--- $605,513 11

$605,301 $605,089 I $604,877 , I I I I

':::T:-o-t=-a-:-I A·-;-s--s-e-:-ts---~-__ - _-_-_-_-_-_-_-_-_-_ -_ -_ -_ -_ -++1 ~$~3~, 3~2~8-=,_9:-O:3_~0l-L_~}' 990, 5361 1 $3,874,620 I $3,802,-=-0-5=7::1-1-11--, -=-$-=-3,=73=-=0:--:, 0:'-::6-3--

I I I I 1 ' T

I-L-ia-~-I~-i~-:-n~-C-i~-~-:~r-tie-s---------tl----jl:-- j I II I ----+: -+1---------1 Accounts Payable I $684H $684: II. . I I - \ I

1-__ -._-=O::-:-t=-he-r-C::-u-rr-en--:t~L7ia-:Cb-;C:ili~tie-s------+I---Il---- I . I! ---r-t------I

!=-_-_.--~~-~~=-~-. ~.,-:L-~-~-:-p=-da~a-r:~=~e-I,--e::i:=~:P8::0-a::-:::0=-=--=--=--=---=--~~~Jf=-~:~~:H-_$31~ . __ $3~ +-·-_·-._-_~-_ .. -=~:-:::~-:COO=--I Line of Credit 309920 1 $68,3281 l $62,3281 i $56,328 1! I! Line of Credit PW 9 I i $770,0001 I I I I I

I II II ~I II

_, __ T_o_ta_�_N_o_te_s_p_a"-ya_b_�e_-_-~_-~_-~-_~_-_~ $169,042 1 )' $863,002 1 i $56,32~+=-- ¢~. ____ $O

I ' 1 , ill _+' -+1 ___ --,-_1

Customer Deposits _'. ___ ~_r~_._.~75 [·-t-. ___ .J375U __ . $375\ . ___ $37511'~ $375 __ -,=-ayroll Liabililties [ $5,426lJ ______ $5,4~~ __ $5,4251 I $5,425 i! $5,426

Accrued Interest Payable I $3,893\1 - ~ ·-1-1 I ~----'f-I +\--------1 1_._T_ot_a_1 O._t_h_er_C_u_r_re __ n_t L_i_ab_il_iti_e_s ___ =I, $179,72011$8i;9,7s1T-$62,4281 r

l

$6'10~ $6,101

Long Term Li-ab-il-it·i-es------+-~-·rt----ti·- I--t-- ··-'-r------2005 Consolidation Loan I $62,2291 I $15,9651 I - I~-·----rr

f-- 2006 Bond Refinance -1 $135,694 i 1 $110, 5Q1LL ' $84,200 I I _ $55,92 q--$2-5-, 5-2-31

2006 Mortgage ! $636,2951 ~_ $585,806 'I I I I !.-+----~ 2012 PW9 Mortgage I I I ,_ :, I $1,294,60811 $1,230,1191 I $1,162,161

j !-r------, i . I ~

I-r--------=T=-_~.,-t_a-C-I~L-_o-n=_g-=I=-~=-rm-=--;-~=ia~b~ili_tc:-ie~s~~~~=_=-._ -+-rl--=-$8c::-:3c:-4C"C,2=-C1"C:'8rt-- $71 ~ ,278 ~k~78, 808 1 i $1 ,286,040 ii, $1,187,684

! !i i J i I .. 1 I 1 -r$1,013,938IT$1,582,0651 i $1,441,2361 1$1,292,1401 1 $1,193,785

! ·--li----!I I i I I ' ' , I I ' 1 ; ~-----------------+I----------'--: f·----------l-: ' ----r-+----.-

Equity ,I i I I' I Ii' r-~~~-~~~-------~I-==~~~~' , '

Paid in Capital ! $734,5001 \ $788,5401 \ $819,214\ I $875,542[! $875,542 -- - Common Stoc'Ck-----·· - I $1,358,563\ I $1,358,5631 $1,358,5631 I $1,358,5631l$T,358,563

Retained Earnings I $106,074i I $156,929\! $196,368\ I $188,422Il $205,811 I--cc-:N-et-~In-c-o_~m_-e_-_-_-"'_~_-~_-~_--_-_-_-_-_-_-1+i-=_-_-:-$1-c-1:-5-'-:-,8-55-1~-~ii--. $1 04,4391.L $59,239.1 I $87,390 I I $96,362

I ! I , 1 I I I I t----=T=-o"-ta"C"l =Eq-u-'7itc-y-------- 1 $2,314,992\ I $2,408,471\ I $2,433,3841 I $2-=,5:C:C0-=-9,-=9·-:-:17=-+1-~-t-1' -=$:-::2--=,5=3-=-6-=,2=78"O'i

Total Liabilities & E'-q-Ui-ty-------+i-$-3-,3-2-8-,9-3-+011 $3,990,53611 $3,874,62011 $3,802,0571 i $3,730,0~~

Total Liabilities

Saratoga Water Services, Inc. I 1 I __ ~_+-__ ~_ 1 -I-~--~-J- 1 _~J_~ ____ _ Income Statement Pro Forma - PTduction Wi" #9 Fin_<:lf!

Cin9 -+~----+~-~---i-+~----+-~l------""--=--=---=-==~=~==---=----~-~=-~~~ ~~juste~~tl=~-=~~~_~~~Ll-----=ll 1--[= -=

! 2010 ! I 2010 Ii 2011 Ii 2012 I! 2013 I i 2014 ~-"--~---~---"-~~- 1-' I ' --1 ~--

Income -------+-! --~~+=-~~=~1-1--==~~-=:f==-~+0==-=~=F+=~=====-Finance Charges I $3,36611 I $3,36611 $3,400 $3,450/ II $3,4751 I $3,500 I " " Interest Income $18[ $1~ ! $20 $20 I $221 I $22 Metered Sales I $807,047 $76-9-;-9131-j $777,3361 I $815,513 1$892,51311$923,417 Misc Water Revenues I $2,240'--- $2,2401 I $2,3001 I $2,3501' I $2,4001 1 $2,450

----;:s~-u-r-c-:-h"-a-rg--e-------jIIf----$::-:3'-=5"-,4-:-::2-;-1+---+ $35,4211: r' $34,235! I $34,235

1

I $34,235 1

1 I $28,661

--"~----~----------+-----l-i------L+- I I I i l"~ __ --I Total Income $848,0921 I $810,958! ! $817,291 I $855,5681 1 $932,6451~$958,050

-=---E-X~P,-:-:-~---~e-:rts-:-iz--:atC:-io--n-'::E=-x--pe-n--s--e------+'II-----::$:-:C2-C12C:--lil----ir-1 -----$"~-~:--:1-=-2 ~ $2121 I $212 i I $212 t-+- $212

Accounting Fees $4,200, I $4,2001 -1 $4,3501 I $4,5001 I $4,6001 i $4,600 i-----=B-a-n--k-C--ha-'r"--ge--s-------iI---'--$"-6--1-4+-ltt-+-I ---'--'-~~--j--+ii~ $6151 I $6251 I $6351 1-- $640

1 ___ C __ r __ ed __ it __ C-,-a--crd_D __ is __ co __ u __ n __ t __ ----'Ii----_$'-1"_,8 __ 9~8! ~ $1 ,898 \ I $1,955 1 I $2,015[ I $2,07511 I --$2,140 Depreciation _____ -+1 __ $'--.1_1_-:5'--,2881 1 $!15,28~l- i $115,2881 I $153,7881 U,:153,788 j $153-:788

_~es & Subscriptions I', $400rr-1 $490 LL $500 i I $500 I i $525 'I i $525 General Office Expense "$14,7141 I $14,7141 J $14,75011

1

$15,0001 I $15,250; U 15,500 Insurance $24,6471 i $24,647J I $26,1251 $27,690! r $29,3501 ! $31,115 Interest Expense Iii I I I ! ! I

1----- Notes I $9,820 I I - $9,820 I =L $18,600 I I $4,000 I I $3,000 I 1 ___ $2,000 2005 Mortgage I $4,411 i $4,411 i I $2,134TT $1681 I $O!! $0

_~ 2006 Bond I $10,8741 i $10,8741 'II $9,019

1

1

'I: $7, 149 1 I $5,1771 J ---$3,057

1----:--L_:9=:-:-0C-:-~:F~=~=So-o-~:gga,--a-",g",-g-:~--- i :::::::11 :::,:::; i :::::::\1 :~~:~~~III :~~:~~~I i ~~~:~~~ MaintiMatereials & E~pense I $49,9721 $49,9721 r $25,000 i $25,500 I $26,000 I $26,500 NYS Corp Taxes $300 $30011 $300' I $300 I $300 -r-- $300 Operating Taxes I $5,712\ $5,7121 1- $5,9361 $5,676 I $5,750' I $6,165 Payroll Expenses 1 $180,291 1

1

i $180,291 i I $183,897 $187,575 i $226,3261 I $230,853 Payroll Fees $214 r $214r I $225 $225 I $225 1 : $235 Payroll Taxes =t $13,8211 I $13,8211-1 $14,068 I $14,349[ I $17,3141 I $17,660

_ProfeSSional Fees I $37,7401 I $37,740 1 I $35,000 - $30,000t~ $30,000! :--$32;060 Power Purchased I $62, 337 1 I $58,3661 l $58,891 1 I $62,012; I $67,531\ I $74,554

Vehicle Expenses I $15,948J I $15,9~_ $16,000 i $17,0001 I $18,0001 1 $19,000 Vehicle Lease I $13,200J i $13,2QQ+-J~2001 II $14,4001 II $14,4001 1 $14,400

I I I Ii' I I'

1~~=-------------1~~~~ii I ii' , I I I

Total Expenses I $745,327 1

1- Ii $740,345L.1 $712,8521 I $796,329[ I $845,2551

1 i $861 688

~---~-----+I-----'.-+I ~I I I I I I I I I ' Net Income I $102'76i1~IQ~~_~_~i-+-$104,j391 I $59,23~ I $87, 390

1 i $96,3~~_ * Elimination of LFTC Construction revenue & expenses i I I I I I I i

Saratoga Water Services, Inc. __ J I L __ i _________ 1 L---------U--------Cash Flow Pro Forma - Production Well #9 Financing ilL I I +1-+1 _____ _

-- uu __ ----------------------~_1-~------1~---==~=--=n------11 -------- --------------.. ----.------- -----·---t------~--+-__1- -----~'-. ---- !--t-------

r--------------------------- IL..1QlL-_W __ }01..~ __ _W- 2013 L~ 2014 I I I I ' i I !

1--------------------------rt---------H----------H H- -------.-

I-0 __ p--c~_r:cc__:i-~n-~-:m-ct-~v-it-ie-s--:c___:___c___~~-=-.---------+,1-+,i-$-C-1--0-4-A39-11.111 I! $59,239 1

1

1 __ $87,390 II _.11 ____ $'-9_6-'-, 3_6?

Adjustments to reconcile Net Income _

-$67,958

-$30,398 Long Term Liabilities: 2006 Mortgage I I -$50,489 I -$585,806L+ II

___ Paid in Capital I I $54,040! $30,6741 ! $56,328, _____ Retained Earnings I I -$65,000 I -$65,0001 I -$65,0001 ih- Ii Ii II Ne~cash provided by Financing ActivitieS-II-$132,900!..L.._ $6-~2.2.041 !-$101,4401 I -$168,356

_N_e_t c_a_s_h_in_c_r_e_a_s_e_fo_r--'-p_e_rio_d _________ --_-----in $35,99911- -$28,Ossjl $71,622 11

Cash at beginning of p_er __ io __ d ___________ 1f--1_ +---! -----'-$2_2---'-,4_4_3-+1-:-1 $58,442: i $86,52711

I-:Cc--a-sh:----at-e-n---:-d-of-c-p-e----cri-od-----------, I $58,44211 $86,52711 $158,14911

-$70,000

$70,006

$158,149

$228,155

Exhibit "8"

MINUTES OF SPECIAL MEETING OF THE BOARD OF DIRECTORS

OF


March 31, 2011

Board Members Present Alexander L. Mackay, President/Treasurer Jean N. Marcotte, Vice President/Secretary

The special meeting was called to order at 9:00 a.m.

The Secretary then presented and read to the meeting a waiver of notice of meeting, subscribed by all the Directors of the Corporation, and it was ordered that it be appended to the minutes of this meeting.

After discussionl a motion was duly madel seconded and carried l it was

RESOLVED, that Alexander L. Mackay as President of Saratoga Water Servicesl

Inc. apply to borrow $1/389,500 ($770,000 new money and refinance $619,500 of the 2006 mortgage) from Adirondack Trust Company and apply to the NYS Public Service Commission for approval of said borrowing.

The meeting was then adjourned at 9: 15 a.m.

Dated: ~~arch 31, 2011

Notice of Proposed Rule Making Submitting Agency

TEXT/SUBSTANCE AND ATTACHMENTS SUBMITTED: [ ] E-MAIL (nysregisterra{dos.state.nv.us) [] DISK

NOTE:

1.

Typing and submission instructions are at the end of this from. Please be sure to COMPLETE ALL ITEMS. Incomplete forms and nonscannable text attachments will be cause for rejection of this notice.

A. [ x] Proposed action: Saratoga Water Services, Inc. has petitioned the Commission for the issuance of an Order authorizing the issuance of long term debt in the amount of$1,389,500.

B. [] This is a consensus rule making. A statement is attached setting forth agency's determination that no person is likely to object to the rule as written [SAP A §202(1 )(b )(i)].

c. [] This rule was previously proposed as a consensus rule making under LD. No. . Attached is a brief description of the objection that caused/is causing the prior notice to be withdrawn [SAPA§202(1)( e)].

D. [] This rule is proposed pursuant to [SAPA §207(3)], 5-Year Review of Existing Rules (see also item 16).

2. Statutory authority under which the rule is proposed: Public Service Law, Section 89-f.b

3. Subject of the rule: The subject of the proposed rule is the issuance oflong term debt by Saratoga Water Services, Inc. .

4. Purpose of the rule: The purpose of the proposed rule is whether the Commission should authorize the issuance of long term debt.

5. Public hearings (check box and complete as applicable): [ ] A public hearing is not scheduled. (SKIP TO ITEM 8) [ ] A public hearing is required by law and is scheduled below. [ ] A public hearing is not required by law, but is scheduled below.

Time: Date: Location:

6. Interpreter services (check only if a public hearing is scheduled): [ ] Interpreter services will be made available to hearing impaired persons, at no

charge, upon written request to the agency contact designated in this notice.

7. Accessibility (check appropriate box only if a public hearing is scheduled): [ ] All public hearings have been scheduled at places reasonably accessible to

persons with a mobility impairment. [ ] Attached is list of public hearing locations that are not reasonably accessible to

persons with a mobility impairment. An optional explanation is submitted regarding the nonaccessibility of one or more hearing sites.

8. Terms of rule (SELECT ONE SECTION): A. [] The full text of the rule is attached since it is under 2,000 words. B. [] A summary of the rule is attached since the full text of the rule is over 2,000

words. [ ] Full text is posted at the following State website: ________ _ [ ] Full text is not posted on a State website. [ ] Full text is not posted on a State website; this is a consensus rule or a rule defined in SAP A § 1 02(2)( a)(ii).

C. [] Pursuant to SAP A §202(7)(b), the agency elects to print a description of the subject, purpose and substance ofthe rule as defined in SAPA § 1 02(2)(a)(ii) [Rate Making].

9. The text afthe rule and any required statements and analyses may be obtainedfrom: Agency contact Agency Name Office address Telephone E-mail:

10. Submit data, views or arguments to (complete only if different than previously named agency contact): Agency contact Agency Name Office address Telephone E-mail:

11. Public comment will be received until:

2

----------

[ ] 45 days after publication of this notice (MINIMUM public comment period when full text is attached because it is under 2000 words or full text of rule has been posted on a State website or the rule is a consensus rule or a rule defined under SAPA §102[2][a][ii] [Rate Making].

[ ] 60 days after publication of this notice (MINIMUM public comment period when full text is not attached or full text is been posted on a State website or the rule is a consensus rule or a rule defined under SAPA §102[2][a][ii] [Rate Making].

[ ] 5 days after the last scheduled public hearing required by statute (MINIMUM, with required hearing). This box may not be checked and the minimum 60-day comment period applies if full text is not attached or full text is not posted on a State website or the rule is a consensus rule or a rule defined under SAP A §102[2][a][ii] [Rate Making].

[ ] Other: (specifY) ____________________ _

12. A prior emergency rule making for this action was previously published in the ___________ issue ofthe Register, LD. No. ________ _

13. Expiration date (check only if applicable): [ ] This proposal will not expire in 365 days because it is for a "rate making" as

defined in SAPA § 1 02(2)(a)(ii).

14. Additional matter required by statute: [ ] Yes (include material required by statute). [ ] No additional material required by statute.

15. Regulatory Agenda (The Division of Housing and Community Renewal; Workers' compensation Board; and the departments of Agriculture and Markets, Banking, Education, Environmental Conservation, Family Assistance, Health, Insurance, Labor, Motor Vehicles and State and other department specified by the Governor or his designee must complete this item. If your agency has an optional agenda published, that should also be indicated below): [ ] This action was a Regulatory Agenda item in the first January issue of the

______ (year) Register. [ ] This action was a Regulatory Agenda item in the last June issue of the

______ (year) Register. [] This action was not under consideration at the time this agency's Regulatory

Agenda was submitted for publication in the Register. [ ] Not applicable.

16. 5-Year Review of Existing Rules (ALL ATTACHMENTS MUST BE 2,000 WORDS OR LESS) [ ] Attached is a statement setting forth a reasoned justification for modification of

the rule. Where appropriate, include a decision of the degree to which changes in

3

technology, economic conditions or other factors in the area affected by the rule necessitate changes in the rule.

[ ] Attached is an assessment of public comments received by the agency in response to the listing of the rule in the regulatory agenda.

[ ] As assessment of public comments is not attached because no comments were received.

[ ] Not applicable.

17. Regulatory Impact Statement (ruS) (SELECT AND COMPLETE ONE; ALL ATTACHMENTS MUST BE 2,000 WORDS OR LESS, EXCLUDING SUMMARIES OF STUDIES, REPORTS OR ANALYSES [Needs and Benefits]):

A. The attached RIS contains: [] The full text of the RIS. [] A summary of the RIS. [ ] A consolidated RIS, because this rule is one of a series of closely related

and simultaneously proposed rules or is virtually identical to rules proposed during the same year.

B. A RIS is not attached, because this rule is: [] subject to a consolidated RIS printed in the Register under I.D.

No. ; issue date: ________ _ [ ] exempt, as defined in SAP A § 1 02(2)(a)(ii) [Rate Making]. [ ] exempt, as defined in SAP A § 102(11) [Consensus Rule Making].

C. A statement is attached claiming exemption pursuant to SAP A 202-a (technical amendment).

18. Regulatory Flexibility Analysis (RF A) for small businesses and local governments (SELECT AND COMPLETE ONE; ALL ATTACHMENTS MUST BE 2,000 WORDS OR LESS):

A. The attached RF A contains: [ ] The full text of the RF A. [ ] A summary of the RF A. [ ] A consolidated RF A, because this rule is one of a series of closely related

rules.

B. [] A statement is attached explaining why a RF A not required. This statement is in scanner format and explains the agency's finding that the rule will not impose any adverse economic impact or reporting, recordkeeping or other compliance requirements on small businesses or local governments and the reason(s) upon which the finding was made, including any measures used to determine that the rule will not impose such adverse economic impacts or compliance requirements.

4

C. A RF A is not attached, because this rule: [ ] is subject to a consolidated RF A printed in the Register under I.D.

No. ; issue date: ________ _ [] is exempt, as defined in SAPA §102(2)(a)(ii) [Rate Making]. [ ] is exempt, as defined in SAP A § 1 02(11) [Consensus Rule Making].

19. Rural Area Flexibility Analysis (RAF A) (SELECT AND COMPLETE ONE; ALL ATTACHMENTS MUST BE 2,000 WORDS OR LESS):

A. The attached RAF A contains: [ ] The full text of the RAF A. [ ] A summary of the RAF A. [ ] A consolidated RAF A, because this rule is one of a series of closely

related rules.

B. [] A statement is attached explaining why a RAF A not required. This statement is in scanner format and explains the agency's finding that the rule will not impose any adverse economic impact or reporting, recordkeeping or other compliance requirements on small businesses or local governments and the reason(s) upon which the finding was made, including any measures used to determine that the rule will not impose such adverse economic impacts or compliance requirements.

C. A RAF A is not attached, because this rule: [ ] is subject to a consolidated RAF A printed in the Register under LD.

No. ; issue date: ________ _ [ ] is exempt, as defined in SAP A § 1 02(2)( a) (ii) [Rate Making]. [] is exempt, as defined in SAPA §102(11) [Consensus Rule Making].

20. Job Impact Statement (JIS) (SELECT AND COMPLETE ONE; ALL ATTACHMENTS MUST BE 2,000 WORDS OR LESS):

A. The attached JIS contains: [ ] The full text of the JIS. [] A summary of the JIS. [ ] A consolidated JIS, because this rule is one of a series of closely related

rules.

B. [] A statement is attached explaining why a JIS not required. This statement is in scanner format and explains the agency's finding that the rule will not impose any adverse economic impact or reporting, recordkeeping or other compliance requirements on small businesses or local governments and the reason(s) upon which the finding was made, including any measures used to determine that the rule will not impose such adverse economic impacts or compliance requirements.

[] A JIS/Request for Assistance [SAPA §201-a(2)(c)] is attached.

5

C. A JIS is not attached, because this rule: [] is subject to a consolidated JIS printed in the Register under LD.

No. ; issue date: ________ _ [ ] is exempt, as defined in SAP A § 1 02(2)( a)(ii) [Rate Making]. [ ] is proposed by the State Comptroller or Attorney General.

AGENCY CERTIFICATION (To be completed by the person who PREPARED the notice.)

I have reviewed this form and the information submitted with it. The information contained in this notice is correct to the best of my knowledge.

I have reviewed article 2 of SAP A and Parts 260 through 263 of 19 NYCRR, and I hereby certify that this notice complies with all applicable provisions.

Name _______________ Signature ___________ _

Address ______________________________ ___

Telephone ___________ _ E-Mail ____________ _

Date ______________ _

Please read before submitting this notice:

1. Except for this form itself, all text must be typed in the prescribed format as described in the Department of State's Register procedures manual, Rule Making in New York.

2. Collate the original notice and attachments as: (1) from; (2) text or summary of rule; and, if any, (3) regulatory impact statement, (4) regulatory flexibility analysis for small businesses and local governments, (5) rural area flexibility analysis, (6) job impact statement. Submit the originals, as colleted and ONE copy of that collated set.

3. Mail or hand deliver hard copy of rule making package to: Department of State, Division of Administrative Rules, 41 State Street, Suite 330, Albany, NY 12231-0001.

4. E-mail text/substance and attachments to: [email protected] or attach a disk containing the text/substance and required material.

6

Summary of Proposed Rule

The Commission is considering a Petition in which Saratoga Water Services, Inc.

("Saratoga") requests that the Commission issue an Order pursuant to Public Service Law

Section 89-f authorizing the Company to issue and sell long-term debt in an amount not to

exceed $1,389,500 to The Adirondack Trust Company (Adirondack) in accordance with the

terms and conditions governing the long-term debt issuance as codified in the Commitment

Letter, dated April 19, 2011; to permit the assets of the Company to be pledged and mortgaged

to Adirondack as collateral security for such long-term debt; and through its duly appointed

officers, agents or employees, to execute all documents and take all appropriate actions

associated with and in furtherance of the issuance of such long-term debt.

7

Documents

USHER FOCEL - Government of New York