additional information - FGUA

2012 Mad Hatter Utilities Acquisition
The Florida Governmental Utility Authority (“FGUA”) acquired the Mad Hatter Utility, Inc. and Paradise
Lakes, LLC Systems (“Mad Hatter”) on Friday, June 29. The FGUA is a government owned utility
created under the provisions of Section 163.01, Florida Statutes, through an interlocal agreement
among Citrus, Hendry, Lee, Pasco, Polk, and DeSoto Counties in Florida. The FGUA was created in
1999 in part as a mechanism to move privately owned systems to public ownership, where a city or
county is not in a position to do so.
In 2007, Pasco County Commissioners, County Staff, and customers requested the FGUA target
certain investor-owned utilities to determine whether acquisition of certain private utilities could be
accomplished in a practical manner and under reasonable financial terms. In 2009, Mad Hatter was
included in these “candidate” systems. In late 2011, Mad Hatter filed a rate increase letter with the
Florida Public Service Commission seeking authorization of a substantial rate increase that, if
passed, would have more than doubled customers’ bills. With the opportunity to transition the utility
to public ownership and have more local control, and the prospect of much higher customer rates,
the FGUA negotiated an agreement to purchase Mad Hatter from its current owner.
In order to make the acquisition, the FGUA needed to raise rates to pay for the costs of acquisition,
operations and improvements. However, the approved FGUA rates are less than rates filed with the
Florida Public Service Commission by Mad Hatter. Rate information is provided throughout the FAQ
section. For more information, please review the FAQ on the following pages or call the Pasco
Customer Service Office at: 727-372-0115.

Mad Hatter Utilities – FGUA Acquisition FAQ
Q: Who is the FGUA
A: The FGUA is a single-purpose local government created by Florida Statutes, focused on water
and wastewater utility ownership, operation and management. The FGUA operates pursuant
to Florida’s open government Sunshine laws like all other local governments, and has a
record of full transparency in its business, and public accountability. The FGUA is known for
ensuring utilities are brought to public standards by necessary improvements, full regulatory
compliance, and a high level of customer service. It currently serves approximately 90,000
customers in seven systems in four counties.
Q. Why is this acquisition occurring
A: In collaboration with Pasco County Government, the FGUA acquired Mad Hatter to assist
Pasco County in easing the burden of a substantial rate increase, obtain more local control,
and to help support future system growth and reliability in the County by providing system
improvements and interconnections with Pasco County Utilities’ system. The FGUA purchase
allows Pasco County to interconnect its system for future growth and acquire the system
when it wishes in the future. The acquisition has been in the negotiation phase since 2009.
The Mad Hatter System was purchased for $14 million.
Q: How will customers benefit from the FGUA’s ownership
A: Customers will benefit from FGUA ownership in several ways. Since the FGUA is a local
government, customers have more direct influence over utility decisions such as rates,
capital improvements, and service levels. Customers get all of the benefits that current FGUA
customers receive, including online bill pay, EZ-pay, public web-based access to all records,
and quick response times to customer inquiries.
FGUA Customers receive exceptional customer service from their utility. A survey was
conducted earlier this year by an independent expert public opinion research firm to gauge
customer satisfaction. A random, statistically valid sample of customers were interviewed by
telephone, with 75% of respondents labeling the utility’s customer service as “good” or
“excellent,” 92% of respondents stating they were “satisfied” or “very satisfied” with
responses to emergencies and 91% of customers being “satisfied” or “very satisfied” with
responses to maintenance requests.
The FGUA works closely with other government agencies to ensure full regulatory compliance
to provide safe drinking water for all customers. In addition, the FGUA will be making
improvements to ensure better service reliability including adequate fire protection and that
future demands on the system can be met.

Mad Hatter Utilities – FGUA Acquisition FAQ
Q. What is the FGUA actively doing to engage the community
A: The FGUA held five public meetings with community leaders and residents to answer
questions, address their concerns, and provide an opportunity for full dialogue with the FGUA
prior to the acquisition. The FGUA has spoken to HOA leaders in the affected communities
and mailed an April 13, 2012 letter introducing the FGUA, notifying residents of the pending
Mad Hatter acquisition and public hearing process. The FGUA held a Special Masters
Hearing on May 15 th at Holy Trinity Lutheran Church in Lutz, FL which was open to all
customers and interested members of the community to provide public comment on the
acquisition and proposed rate increases. The FGUA will give the opportunity to participate in
a Utility Advisory Committee, a volunteer committee comprised of appointed customers that
will review capital improvement activity, system rates, policies and procedures and customer
service activities.
Q. What is FGUA’s relationship with Pasco County Government
A: The FGUA has a strong relationship with its host government, Pasco County. It is party to the
Interlocal Agreement governing the FGUA and has a seat on the Board of Directors. The
Board of County Commissioners reviewed and approved every step of the FGUA’s Mad Hatter
Acquisition. In addition, the FGUA works closely with Pasco County Utilities on a number of
initiatives, ranging from economical, joint bulk water and wastewater agreements to more
cost effectively use utility facilities and local capital improvement projects to collaborative
community outreach initiatives, including an annual school student poster contest. The FGUA
acts as an extension of Pasco County Utilities services.
Q: What types of improvements will be occurring
A: After thoroughly analyzing the system, the FGUA has identified $3.4 million in capital
improvements needed to address regulatory compliance and future growth to the system.
Improvements include: installing interconnections with Pasco County Utilities to ensure
future service reliability and capacity, converting the disinfectant process from free chlorine
to chloramines to be compatible with county-supplied water, installing SCADA (remote,
electronic monitoring systems) at well sites, and rehabilitating lift stations. Details of the
capital improvement projects will be more fully described to communities when they are to
commence.

Mad Hatter Utilities – FGUA Acquisition FAQ
Q: How much is my bill going to be after the acquisition
A: Individual customer bills will vary depending on a number of factors including the customer’s
meter size, water use, and the location within the Mad Hatter service area. Different
locations have different rates due to the capital improvements and operations costs
associated with the each area’s needs. A detailed schedule of proposed rates was included
in a customer letter mailed, April 13, 2012 and was published in the Tampa Bay Times on
April 21, 2012. This schedule will also be available on the FGUA website at www.fgua.com or
by calling the FGUA Pasco Office at 727-372-0115.
Q: How were the rates determined
A: The rates were determined through careful analysis of operations, maintenance, capital
improvement, as well as acquisition costs by an independent rate consultant. Rates were
set at levels necessary to sell bonds at favorable interest rates. The FGUA Board of Directors
approved the rates at a Public Hearing on Thursday, May 17.
Q: When will the new rates take effect
A: Bills were sent to customers in the Foxwood Community by Mad Hatter in mid-June. The next
bill customers received in the Turtle Lake, Paradise Lakes, and Linda Lakes areas were sent
from the FGUA but reflected the Mad Hatter rates. These bills were mailed in early July
consistent with the previous owner’s billing schedule. The Mad Hatter rates are being applied
for these bills because they are for meter reading cycles completed to FGUA ownership. The
FGUA approved rates took effect for all bills rendered after this initial mailing.
Q: Can you provide me with an example of what a typical bill l may look like
A: As an example, tables are provided below to show what a residential customer who uses
6,000 gallons of water and has a 5/8” meter could expect under the FGUA approved rates
and under the filed Mad Hatter Public Service Commission increase request. A similar table
was provided in an April 13, 2012 letter that was mailed to impacted customers.
Service Area
Previous
Rates
Mad Hatter
Proposed Rates
FGUA
Approved Rates
Mad Hatter West 1 $51.28 $103.95 $89.29
Mad Hatter East 2 $51.28 $103.95 $89.29
Paradise Lakes $43.24 N/A $89.29
Linda Lakes $62.29 $103.95 $89.29
1
Includes Foxwood and Cypress Cove developments
2
Includes Terra Bella, Twin Lakes, Turtle Lakes, Woodridge Highland Oaks,
Carpenter's Run, and Oak Grove

Mad Hatter Utilities – FGUA Acquisition FAQ
Base Charges
Usage Charges 3
Total
Service Area Water Wastewater Water Wastewater (6,000 gallon usage)
Mad Hatter West 1 $19.86 $15.67 $3.32 $5.64 $89.29
Mad Hatter East 2 $19.86 $15.67 $3.32 $5.64 $89.29
Linda Lakes $19.86 $15.67 $3.32 $5.64 $89.29
Paradise Lakes (Residential) $19.86 $15.67 $3.32 $5.64 $89.29
Paradise Lakes (Condos) $29.82 $32.59 - - $62.41
Notes: Rate table assumes a residential dwelling with a 5/8" meter and 6,000 gallons of usage. Please see Notice of
Public Hearing document for commerical rates, master metered rates, and other miscellanous fees.
1
Includes Foxwood and Cypress Cove developments
2
Includes Terra Bella, Twin Lakes, Turtle Lakes, Woodridge Highland Oaks, Carpenter's Run, and Oak Grove
3
Usage charges are per 1,000 gallons
Q: Why such a sharp increase in the rates Could the FGUA phase the increases s gradually
A: The rates for the increase must take effect in full immediately in order to cover the
acquisition, critically needed system improvements, and bond financing. Without these initial
increases, financing could not be obtained.
Q: Why is the FGUA’s Consolidated System involved in the transaction
A: The FGUA Consolidated System is being included in the transaction to secure favorable
financing for both systems. The Consolidated System was originally financed by a short-term
bank loan with a five-year maturity. By including the Consolidated System in the transaction,
the FGUA is able to lock in long term favorable financing and a lower interest rate for that
system as well as improving the marketability of Mad Hatter financing. As a result, the
acquisition cost and overall impact to customers is reduced.
Q: Does the FGUA gain a profit by purchasing and operating the system
A: The FGUA did not pursue the system to make a profit. The FGUA is a government entity and
does not earn a profit. Instead, the FGUA is focused on meeting critical water and wastewater
utility needs in partnership with county government. The FGUA received support from Mad
Hatter customers and county staff on an agreed purchase price of $14 million. The financing
obtained by the FGUA provides funding to purchase the utility and to execute the Capital
Improvement Plan, which is designed specifically to address water service and quality
concerns and to improve customer service.
Q: It appears that Mad Hatter Utilities, , Inc. is still in operation. Why is this
A: The FGUA acquired four utility service areas from Mad Hatter located in Pasco County (Linda
Lakes Groves, Paradise Lakes, Mad Hatter East and Mad Hatter West). However, Mad Hatter
Utilities, Inc. still maintains and operates three system areas in Hillsborough County.

Mad Hatter Utilities – FGUA Acquisition FAQ
Q: What payment options will be available to Mad Hatter Utility area customers
A: The FGUA provides many payment options. Customers may make payment by mailing their
payment to the FGUA, paying in person at the FGUA Pasco Customer Service Office, paying
over the phone by credit card, paying by Electronic Funds Transfer using a banking account
(EZ-Pay), paying online at the FGUA website at www.fgua.com, or by visiting any local Amscot
location. EZ-Pay forms are available online at the FGUA website by clicking on the “Customer
Center” link on the home page followed by clicking and downloading the “EZ-Pay
Authorization Agreement.” Customers interested in making an online payment may click on
the “Online Bill Pay” link, then on “Consolidated Customers” and then follow the instructions
provided.
Q: How will my customer service experience change as an FGUA customer
A: The FGUA’s mission focuses on providing excellent water and wastewater utility service
to its customers. In order to fulfill this mission, the FGUA Capital Improvement Plan
includes a strong emphasis on public involvement and developing positive relationships
with FGUA customers by increased communication with customers through community
meetings and billing inserts, as well as providing a Community Service Representative
team to address significant customer concerns.
Q: What can consumers do if they have issues with their water quality or service
A: Customers are encouraged to report any issue to the Pasco FGUA Utility Customer
Service Office at (727) 372-0115.
Q: How can I address my outstanding concerns
A: Customers may call our Pasco County Customer Service Office at 727-372-0115 or visit the
FGUA website at www.fgua.com. In addition, Customers interested in participating in the
Mad Hatter Customer Committee may contact Matt Rihs, Community Service Representative,
at (727) 372-0115, x330.