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7.A. - Page 89 <br /> 3.10 Sewer Rate Derivation <br /> BWA derived updated sewer rates that account for both a) the overall rate increases identified in <br /> the financial projections, and b) proposed rate structure modifications. The proposed rates are <br /> designed to equitably apportion and recover costs from the City's customer base. The basic <br /> methodology used to develop new rates includes the following steps: <br /> Derive Unit Rates for Wastewater <br /> Flow& Strength <br /> Divide costs allocated for recovery from <br /> flow and strength by total loadings for <br /> each parameter to derive unit rates for <br /> wastewater flow, BOD, and SS. <br /> I <br /> Allocate Costs to Residential vs... <br /> Non-Residential Classes <br /> Multiply unit rates by the wastewater <br /> loadings of residential vs. non-residential <br /> customer classes. <br /> SI <br /> Residential Rate Derivation Non-Residential Rate Derivation <br /> Determine number of dwelling unit Apply underlying unit rates for flow and <br /> equivalents (DUEs) based on 75%fixed & strength to the wastewater strength <br /> 25% usage-based cost recovery. characteristics of each customer class. <br /> Divide costs allocated for residential cost <br /> recovery by total DUEs to determine a fixed <br /> rate per DUE. Apply to characteristics of <br /> each residential rate class. <br /> Updated rates for each customer class were derived based on a) first developing uniform underlying <br /> unit charges for wastewater flow and strength, and subsequently b) applying those unit charges to <br /> the wastewater characteristics of each customer type. This approach ensures rate equity between <br /> the various customer classes since all rates are based on the same underlying unit charges for <br /> wastewater flow and strength. Rates were developed using this approach for fiscal year 2018/19, <br /> the final year of the proposed 3-year rate projection. Rates in intervening years are phased in to the <br /> levels calculated for 2018/19. <br /> B Sewer Utility Finances& Rates 62 <br /> VV <br /> Water&Sewer Financial Plans&Rate Studies <br />