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Item 5.1 - Visual slideshow presented by Staff at MeetingWATER AND WASTEWATER RATE STUDY AND PUBLIC WORKSHOP NOVEMBER 19, 2019 •Bill Estimator •Water •Residential rate structure options •Option 2b and Option 2c •Proposed target reserves •Wastewater •Residential rate structure options •Option 2b and Option 2c •Proposed target reserves •Timeline Agenda •167 unique downloads as of Nov. 19 Bill Estimator Water Rate Design Options and Reserves Water Rate Design: Fixed/Variable Water Rate Design: Option 2b Impacts Tier Tier Breakpoint (Units)% of Water Use % of Bills 1 20 42%49% 2 56 29%35% 3 >56 29%16% Avg. usage:37 units Fixed:20% Avg. summer usage:56 units Variable:80% 1.Average single-family household •Bi-monthly consumption: 37 units •Meter Size: ¾” 2.Tier Structure: •Current: 2-tier | 16%/84% F/V •Proposed: 3-tier | 20%/80% F/V Water Rate Design: Option 2b Example Bill Current Proposed (Mar. 2020)Proposed (Jan. 2021) Residential1,2 $240.60 $240.14 $251.18 Change ($)($0.46)11.04 Change (%)(0.2%)4.6% Water Rate Design: Option 2c Impacts Tier Tier Breakpoint (Units)% of Water Use % of Bills 1 20 42%49% 2 56 29%35% 3 >56 29%16% Avg. usage:37 units Fixed:25% Avg. summer usage:56 units Variable:75% 1.Average single-family household •Bi-monthly consumption: 37 units •Meter Size: ¾” 2.Tier Structure: •Current: 2-tier | 16%/84% F/V •Proposed: 3-tier | 25%/75% F/V Water Rate Design: Option 2c Example Bill Current Proposed (Mar. 2020)Proposed (Jan. 2021) Residential1,2 $240.60 $245.46 $256.78 Change ($)$4.86 11.32 Change (%)2.0%4.6% Option Pros Cons Opt. 2b: Three-tier structure with a 20/80 fixed/variable ratio •Mirrors essential water use, average use, and high volume •Moderate revenue stability •Stronger conservation signal •Less affordable for low volume users •Could lead to demand hardening Opt. 2c: Three-tier structure with a 25/85 fixed/variable ratio •Mirrors essential water use, average use, and high volume •Good revenue stability •Stronger conservation signal •Least affordable for low volume users •Could lead to demand hardening Water Rate Design: Option 2 Pros/Cons •Minimum reserve: 90 days of operating expenses •Target reserve (Workshop 1): 180 days of operating expenses •Target reserve (Workshop 2): 120 days of operating expenses Target Operating Fund Balances Water Financial Plan: Rate Comparison Wastewater Rate Design Options and Reserves •Fixed + variable residential rate •85% of lowest winter water bill for the property averaged over 3 years •Capped at 24 ccf Wastewater Rate Design: Option 2 Wastewater Rate Design: Option 2 Wastewater Rate Design: Option 2b Impacts Item Amount Fixed:25% Variable:75% Avg. winter wastewater generation:15 units Units Current ($)Proposed ($)Difference ($)Difference (%) 1 50.88 26.88 (24.00)(47.2%) 2 50.88 31.56 (19.32)(38.0%) 3 50.88 36.25 (14.63)(28.8%) 4 50.88 40.94 (9.94)(19.5%) 5 50.88 45.62 (5.26)(10.3%) 6 73.46 50.31 (23.15)(31.5%) 7 73.46 55.00 (18.46)(25.1%) 8 73.46 59.68 (13.78)(18.8%) 9 73.46 64.37 (9.09)(12.4%) 10 73.46 69.06 (4.40)(6.0%) 11 73.46 73.74 0.28 0.4% 12 73.46 78.43 4.97 6.8% 13 99.79 83.12 (16.67)(16.7%) 14 99.79 87.80 (11.99)(12.0%) 15 99.79 92.49 (7.30)(7.3%) 16 99.79 97.18 (2.61)(2.6%) 17 99.79 101.86 2.07 2.1% 18 99.79 106.55 6.76 6.8% 19 99.79 111.24 11.45 11.5% 20 107.33 115.92 8.59 8.0% 21 107.33 120.61 13.28 12.4% 22 107.33 125.30 17.97 16.7% 23 107.33 129.99 22.66 21.1% 24 107.33 134.67 27.34 25.5% Wastewater: Option 2b (F/V 25%/75%) 1.Average single-family household •Bi-monthly winter wastewater generation: 15 units 2.Tier Structure: •Current: 7-tier | 20%/80% F/V •Proposed: Variable + Fixed | 24 unit variable cap | 25%/75% F/V Wastewater Rate Design: Option 2b Example Bill Current Proposed (Mar. 2020)Proposed (Jan. 2021) Residential1,2 $99.79 $92.49 $98.32 Change ($)($7.30)$5.83 Change (%)(7.3%)6.3% Wastewater Rate Design: Option 2c Impacts Item Amount Fixed:30% Variable:70% Avg. winter wastewater generation:15 units Units Current ($)Proposed ($)Difference ($)Difference (%) 1 50.88 31.00 (19.88)(39.1%) 2 50.88 35.38 (15.50)(30.5%) 3 50.88 39.75 (11.13)(21.9%) 4 50.88 44.12 (6.76)(13.3%) 5 50.88 48.50 (2.38)(4.7%) 6 73.46 52.87 (20.59)(28.0%) 7 73.46 57.25 (16.21)(22.1%) 8 73.46 61.62 (11.84)(16.1%) 9 73.46 66.00 (7.46)(10.2%) 10 73.46 70.37 (3.09)(4.2%) 11 73.46 74.74 1.28 1.7% 12 73.46 79.12 5.66 7.7% 13 99.79 83.49 (16.30)(16.3%) 14 99.79 87.87 (11.92)(11.9%) 15 99.79 92.24 (7.55)(7.6%) 16 99.79 96.62 (3.17)(3.2%) 17 99.79 100.99 1.20 1.2% 18 99.79 105.37 5.58 5.6% 19 99.79 109.74 9.95 10.0% 20 107.33 114.11 6.78 6.3% 21 107.33 118.49 11.16 10.4% 22 107.33 122.86 15.53 14.5% 23 107.33 127.25 19.91 18.5% 24 107.33 131.61 24.28 22.6% Wastewater: Option 2c (F/V 30%/70%) 1.Average single-family household •Bi-monthly winter wastewater generation: 15 units 2.Tier Structure: •Current: 7-tier | 20%/80% F/V •Proposed: Variable + Fixed | 24 unit variable cap | 30%/70% F/V Wastewater Rate Design: Option 2c Example Bill Current Proposed (Mar. 2020)Proposed (Jan. 2021) Residential1,2 $99.79 $92.24 $98.05 Change ($)($7.55)$5.81 Change (%)(7.6%)6.3% Option Pros Cons Opt. 2b: Fixed + variable residential rate with a 25/75 fixed/variable ratio •Bills based on wastewater generation while also accounting for the fixed costs •Greater revenue stability •Bill is constant throughout the year once the wastewater flow is established –easy for customer to understand •Need to track winter water use to estimate wastewater flow Opt. 2c: Fixed + variable residential rate with a 30/70 fixed/variable ratio •Bills based on wastewater generation while also accounting for the fixed costs •Greatest revenue stability •Bill is constant throughout the year once the wastewater flow is established –easy for customer to understand •Need to track winter water use to estimate wastewater flow Wastewater Rate Design: Option 2 Pros/Cons •Minimum reserve: 90 days of operating expenses •Target reserve (Workshop 1): 180 days of operating expenses •Target reserve (Workshop 2): 120 days of operating expenses Target Operating Fund Balances Wastewater Financial Plan: Rate Comparison Workshop 1: Presentation of options Oct. 15, 2019 Workshop 2: Presentation of options Nov. 19, 2019 Set Public Hearing Jan. 7, 2020 Mail 218 Notice By Jan. 17, 2020 Public Hearing Mar. 3, 2020 Schedule Year 1: Rates Effective Mar. 3, 2020 Year 2: Rates Effective Jan. 1, 2021 Set Public Hearing Sept. 7, 2021 Mail 218 Notice By Sept. 17, 2021 Public Hearing Nov. 2, 2021 Year 1: Rates Effective Jan. 1, 2022 Year 2: Rates Effective Jan. 1, 2023First Two-Year Rate PeriodSecond Two-Year Rate Period Discussion