Maintenance, repairs and minor improvements are charged to expense as incurred. Improve-
ments which significantly increase the value of property, plant and equipment are capitalized.
Cash and Cash Equivalents
Cash and cash equivalents generally consist of cash, money market funds and other short-
term liquid investments with original maturities of three months or less.
Restricted Cash - RSF
This restricted cash balance consists of funds maintained for the Rate Stabilization Fund
(“RSF”), which was established in conformity with the requirements of NHPUC Order
25,292, as explained more fully in Note 12 of these financial statements. The RSF is an
imprest fund of $5 million, which is subject to funding above or below the imprest fund
balance, reflecting actual revenue performance as it relates to prescribed revenue levels
supported by the RSF. Of the approximately $5.7 million in restricted cash as of December
31, 2015 and in compliance with the rules governing the use of the RSF, approximately
$729,000 is reserved as a potential return to rate payers as a component of the new water
rates set as a result of the next promulgated rate case before the NHPUC, for which that
timing and occurrence is yet to be determined.
Restricted Cash — Bond Project Funds
This restricted cash balance consists of funds which resulted from the issuance of the Series
2014 and 2015 tax-exempt bonds in December of 2014 and October of 2015, respectively.
The new money proceeds, as described in Note 10, from those bond issuances are maintained
in a separate restricted cash account, and are subject to withdrawal as a reimbursement of
eligible capital project expenditures for the years 2014 through 2016, as defined by the
indenture and issuance documents associated with each offering. This fund was initially
funded at a level of $19.5 million, at the time the 2014 bonds were issued in December of
2014, then increased by approximately $7.5 million to approximately $27 million, with the
proceeds from the 2015 bond issuance, in October 2015. In the period beginning in
December of 2014 through December 31, 2015, a total of approximately $7.3 million has
been drawn from the fund for payment of closing costs and as reimbursements for qualifying
capital projects completed and “used and useful” during late 2014 and throughout 2015. In
late 2015, $17.2 million was drawn from these restricted cash amounts and invested in
financial instruments with varying maturities throughout 2016.
Restricted Cash — Bond Refund Escrow
This restricted cash balance consists of funds that resulted from the issuance of the Series
2014A tax-exempt bonds in December of 2014, as notated and fully described in Note 10 of
these audited financial statements. The refinance money proceeds, as described in Note 10,
from that bond issuance are maintained in a separate restricted cash account, pending the
completion of the refinance of existing tax-exempt bonds on January 20, 2015, the date at
which the required 30-day notice period to bondholders has expired from the date of
notification after the close of the December 15, 2014 bond closing. As of January 20, 2015,
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