Agenda - 06-12-2007-4gg - Laserfiche WebLink

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as o. A 2 EFLAND SEWER SYSTEM Proposal for Rate Study for Small Wastewater Collection Utility the first five years of operations considering the initial unit rate as set forth in the Inter-Local Agreement and agreed upon by the eight (8) original member entities. PROJECT DETAILS Birmingham Water Works Board, .Alabama Cost of Service Study RFC conducted a cost of service study for the Bimvngham Water Works and Sewer Board Rate Study (the `Board"). The Board provides retail water service to over 200,000 customers, retail Bond Feasibility Rate Model sewer service to over 3,000 customers, and raw water to over 100 industrial accounts. RSE Process Through a cost of service study, RFC developed a rate stabilization and equalization ("RSE") Affordability Miscellaneous Fees process. As a part of a legal settlement with the Citp of Birmingham, the Board agreed to come under regulation by the Alabama Public Service Commission ("I'SC'~. Other utilities REFERENCE re ted b the Alabama PSC have develo ed RSE rocesses to sim rate film While Mr. Mac Underwood ~ y p P p~ g' General Manager the existing RSE's are based on rate of return metrics, the Board's RSE had to be developed Birmingham Water Works Board to ensure debt service coverage requirements are satisfied. The RSE process defines when a 3600 First Avenue North Birmingham, AL 35222 rate increase or decrease is warranted. Once the Alabama PSC accepts the RSE, the Board's Phone: (205) 244-4403 rates will increase without the Board being forced to enact the increase. By doing so, rate issues should become depoliticized. As part of the cost of service study, RFC also reviewed the methodology used to develop miscellaneous fees such as tap connection fees, reconnection fee, and bad order plumbing, and provided recommendations for revising the fee calculations. In addition, RFC examined potential affordability programs. RFC has also recently begun a project to develop system development charges for the Board. Over the past four years, RFC has assisted the Board in preparing official. statements for three bond offerings in the amounts of $300 million, $84 million, and $90 million. RFC developed a program. of rate increases necessary to pap the debt service and meet the bond requirements, assisted in preparing a presentation for the rating agencies, and RFC personnel participated in meetings with the rating agencies. PROJECT DETAILS Charlotte-Mecklenburg Utilities, North Carolina Cost of Service Study RFC originally assisted Charlotte-Mecklenburg Utilities ("Utilities") in developing a water Rate Study and sewer financial planning and rate model and related user manual The rate model has Rate Model been used to update rates and assist with Utilities' financial planning. The model focused on REFERENCE providing long-term. rates, management information, and graphic representations of model Mr. Doug Bean ou ut. Since the o al model develo men RFC has rovided assistance in u datin and Director ~' ~ P ~ p P g Charlotte Mecklenburg Utilities refining the rate model on an annual basis. Recently, RFC completed a comprehensive 5100 Brookshire Boulevard revision to the methodology used to calculate certain. industrial. waste charges. As part of Charlotte, North Carolina 28216 Phone: (704) 399-2221 this project, RFC examined many different approaches, calculated the costs and impacts of implementing a new approach, and participated in meetings with Utilities' Advisory Council and the public to discuss the new recommended approach. Additionally, RFC has assisted Utilities in performing risk analysis on its revenue stream. Following years of abnormally dry ~~ weather, the Charlotte area has received above average rainfall. As a result, revenues ONSULTANTS, NC.16