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7.A. - Page 61 <br /> use often reflect high levels of non-essential outdoor water consumption, such as for large <br /> yards and/or lack of water-wise landscaping, and/or very inefficient use of water. The City <br /> attributes most of the water used in this highest tier toward contributing to the need for the <br /> City's recycled water system and Water Resources Management Program. <br /> B) Transition to Uniform Quantity Charge for Non-Residential Accounts <br /> BWA recommends the City implement a commercial volumetric rate with a uniform rate that <br /> applies to each unit of water use, in order to more equitably recover costs from non-residential <br /> accounts. The City's current rate structure includes a 2-tiered inclining rate structure for <br /> commercial water use (excluding irrigation accounts) with the first 15 units of monthly water <br /> use billed at the lower tier rate and all additional water use billed at the higher rate. The impact <br /> of this structure is that smaller commercial customers obtain most of their water at substantially <br /> lower rates than larger commercial or institutional customers. <br /> Unlike residential customers, which are a relative homogenous class, commercial customers <br /> include an extremely wide range of accounts from small offices and stores to restaurants to <br /> large office buildings, hospitals, and schools, etc. These commercial accounts have widely <br /> different consumption patterns. Hence it is impracticable to develop a system of rate tiers that <br /> equitably apply to such a wide range of commercial accounts. With residential rates, higher tier <br /> rates generally apply to discretionary outdoor water use. However, with tiered commercial <br /> rates, higher tiers simply result in higher charges on customers with higher levels of water <br /> demand, regardless of how efficient the customers are with water use. <br /> For example, under the City's current rates, a small commercial account that uses water very <br /> inefficiently would still pay $4.82 per hcf, while a large customer or school that has invested <br /> heavily in water efficiency would pay $7.87 for most of their water use simply because they are <br /> a larger customer with higher water demand. <br /> I Water Utility Finances& Rates 34 <br /> \'\ Water&Sewer Financial Plans&Rate Studies <br />