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<br />
<br />Water Rate Cost-of-Service Study
<br />Section 4. Cost-of-Service Analysis
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<br />HF&H Consultants, LLC | July 8, 2025 | Page 34 of 53
<br />Figure 4-7. System Wide Cost Allocation Factors
<br /> Source: Appendix A: Table 8, Table 8B, and Table 8C.
<br />
<br />The revenue requirements in Figure 4-5 are allocated to the demand and customer service
<br />functions in Figure 4-8, using the calculated factors from Figure 4-7. The resulting
<br />allocations indicate that slightly more than 63% of the revenue requirement is attributable to
<br />the demand service component and roughly 37% to the customer service, capacity and fire
<br />protection components. As previously mentioned, the Water Use Charge rates are designed
<br />to recover the costs allocated to the demand service component and the Service Charge rates
<br />are designed to recover the customer service, capacity, and fire protection costs.
<br />Figure 4-8. Service Function Allocations
<br /> ¹Goverment Code 53750.5 authorizes the inclusion of public fire protection costs in water rates.
<br />
<br />Customer Services Private
<br />Demand Public Fire Fire
<br />System-Wide Cost Allocation Factors Services Service Capacity Services Services Total
<br />a Demand 100.0% 0.0% 0.0% 0.0% 0.0% 100.0%
<br />b Capacity 0.0% 0.0% 100.0% 0.0% 0.0% 100.0%
<br />c Services 0.0% 100.0% 0.0% 0.0% 0.0% 100.0%
<br />Composite Allocations
<br />d O&M Revenue Services 0.0% 100.0% 0.0% 0.0% 0.0% 100.0%
<br />e O&M Admin Support Services 0.0% 100.0% 0.0% 0.0% 0.0% 100.0%
<br />f O&M Water Customer Services 53.3% 46.5% 0.2% 0.0% 0.0% 100.0%
<br />g O&M Water Supply and Distribution 64.5% 0.0% 35.5% 0.0% 0.0% 100.0%
<br />h O&M Water Supply and Distrib. (Fire Protection) 0.0% 0.0% 0.0% 80.7% 19.3% 100.0%
<br />i SFPUC Water Purchases 98.6% 0.0% 1.4% 0.0% 0.0% 100.0%
<br />j O&M Water Resource Management 93.8% 0.2% 6.0% 0.0% 0.0% 100.0%
<br />k O&M Composite 77.7% 7.9% 5.2% 7.4% 1.8% 100.0%
<br />l CIP Composite 0.0% 4.6% 95.4% 0.0% 0.0% 100.0%
<br />m Exp Composite 60.7% 7.4% 24.7% 5.8% 1.4% 100.0%
<br />Water Use Charge Service Charge
<br />FY 2025-26 Public Fire Private Fire
<br />Revenue Allocation Protection Protection
<br />Requirement Factor Demand Customer Capacity Services Services
<br />O&M Expenses
<br />61410-Revenue Services $2,509,087 d $0 $2,509,087 $0 $0 $0
<br />65142-Water Customer Services $2,723,818 f $1,451,622 $1,267,315 $4,881 $0 $0
<br />65144, 65147-Water Supply and Distribution $5,598,279 g $3,612,778 $0 $1,985,501 $0 $0
<br />65144-Water Supply & Distrib (Fire Protection) $4,353,012 h $0 $0 $0 $3,511,574 $841,439
<br />65145-SFPUC Water Purchases $26,695,000 i $26,325,000 $0 $370,000 $0 $0
<br />65146-Water Resource Management $1,916,272 j $1,797,098 $4,639 $114,534 $0 $0
<br />65144-Water Supply & Distrib. Rec. Water Debt $3,782,913 a $3,782,913 $0 $0 $0 $0
<br />Total Allocable O&M $47,578,381 $36,969,410 $3,781,042 $2,474,917 $3,511,574 $841,439
<br />O&M Composite 77.7%7.9%5.2%7.4%1.8%
<br />Capital Expenses (PAYGo)$13,161,266 l $0 $600,181 $12,561,086 $0 $0
<br />Subtotal - O&M and Capital $60,739,647 $36,969,410 $4,381,222 $15,036,002 $3,511,574 $841,439
<br />Unallocated O&M
<br />61710-Administrative Support Services $122,560 e $0 $122,560 $0 $0 $0
<br />Administrative Costs $122,560 $0 $122,560 $0 $0 $0
<br />Subtotal O&M, Capital, Non-Operating $60,862,207 $36,969,410 $4,503,782 $15,036,002 $3,511,574 $841,439
<br />Expense Composite 60.7%7.4%24.7%5.8%1.4%
<br />Non-Operating Revenue $0 $0 $0 $0 $0
<br />46205-Backflow Devices Admin Fee ($124,800)c $0 ($124,800)$0 $0 $0
<br />46210-Backflow Devices Testing Fee ($26,000)c $0 ($26,000)$0 $0 $0
<br />49725-Miscellaneous Revenue ($10,300)c $0 ($10,300)$0 $0 $0
<br />49901-Transfer from General Fund ($718,059)c $0 ($718,059)$0 $0 $0
<br />49910-Transfer from Sewer Fund ($769,566)c $0 ($769,566)$0 $0 $0
<br />Total Non-Operating ($1,648,725)$0 ($1,648,725)$0 $0 $0
<br />Transfers to/(from) Reserves ($6,263,116)m ($3,804,392) ($463,468) ($1,547,302) ($361,364) ($86,590)
<br />Total Revenue Requirement $52,950,366 $33,165,018 $2,391,589 $13,488,700 $3,150,210 $754,849
<br />$33,165,018 $2,391,589 $13,488,700 $3,150,210 $754,849
<br />62.6%35.9%1.4%
<br />ATTY/RESO.0109/CC RESO WATER RATES - EXHIBIT A
<br />REV: 11-05-25 MI
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