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Water & Wastewater Capital Charges

Water & Wastewater Capital Charges. Discussion Agenda July 14, 2009. Capital Charges. Background Methodology 2008 Update Other Utilities – Comparison Next Steps. Background. Capital Charges Paid by developers for infrastructure to serve growth

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Water & Wastewater Capital Charges

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  1. Water & Wastewater Capital Charges Discussion Agenda July 14, 2009

  2. Capital Charges • Background • Methodology • 2008 Update • Other Utilities – Comparison • Next Steps

  3. Background • Capital Charges • Paid by developers for infrastructure to serve growth • Mechanism for growth to “pay its own way” • Used only for growth related projects

  4. Background • Capital Charges • Discretionary source of funding • Cannot exceed full cost recovery • Can be set below full cost recovery

  5. Background • Current Charges • Based on 2004 study • Phased in over time • Set at full cost recovery • Considered future alternative water infrastructure

  6. Background • Current Charges • Water • $1,950 per ERC • 350 GPD • Wastewater • $3,668 per ERU • 300 GPD

  7. Capital Charges • Background • Methodology • 2008 Update • Other Utilities – Comparison • Next Steps

  8. Methodology • Combined Cost Basis Approach • Replacement cost of existing system infrastructure • Future capital improvements cost to develop future system capacity • Costs are brought to present value • Credit applied to remove Debt Service costs funded from rates

  9. Capital Charges • Background • Methodology • 2008 Update • Other Utilities – Comparison • Next Steps

  10. 2008 Update • Assumes groundwater and alternative water as sources of supply • 5 year planning horizon used for groundwater • 10 year planning horizon used for alternative water

  11. 2008 Update Water Current $1,950 Update $2,603 +$ 653 33.5% Wastewater Current $3,668 Update $3,673 +$ 5 0.1% Combined Current $5,618 Update $6,276 +$ 658 11.7%

  12. Capital Charges • Background • Methodology • 2008 Update • Other Utilities – Comparison • Next Steps

  13. Water Capital Charge Comparison

  14. Wastewater Capital Charge Comparison

  15. Capital Charges • Background • Methodology • 2008 update • Other Utilities – Comparison • Next Steps

  16. Next Steps • BCC Direction • Option A: • Proceed with DAB and LPA review • Conduct Public Hearing with BCC • Adopt updated charges • Option B: • Delay updated charges • Maintain existing Capital Charges at current levels • Update the report in two years

  17. Water & Wastewater Capital Charges Discussion Agenda July 14, 2009

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