HomeMy WebLinkAbout2020-10-15; Water and Wastewater Rate Changes Set for January 1, 2021; Gomez, Paz{city of
Carlsbad
To the members of the:
CITY COUNCIL
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CM ✓ ACM ✓ocM(3)✓ Ccarlsbad
Municipal Water District ·
Memo ID #2020228
Council/CMWD Board Memorandum
Oct. 15, 2020
To:
From:
Honorable Mayor Hall and Members of the City Council
Carlsbad Municipal Water District Board of Directors
Paz Gomez, Deputy City Manager, Public Works
Geoff Patnoe, Assistant City Manager Q , Via:
Re: Water and Wastewater Rate Changes ~for Jan. 1, 2021
This memorandum provides an update on the previously approved water and wastewater rate
increases that will go into effect on Jan. 1, 2021.
Background
Based on a Cost Of Service Study, on Nov. 19, 2019, the City Council held a Public Hearing and adopted
Resolution No. 2019-244, which established wastewater rates for the two calendar years 2020 and
2021. On the same date, the CMWD Board of Directors approved Resolution No. 1624 for two-year
rates for potable and recycled water services.
On Jan. 1, 2020, the first year of rate increases for the new wastewater, potable and recycled water
rates went into effect. On Jan. 1, 2021; the second year of approved rates will be implemented
(Attachments A and B).
Discussion
Before the Jan. 1, 2020 rate increase, potable water rates had not increased for two years and
wastew~ter rates for four years. Even with these new increases, ratepayers still be provided with low
rates when compared to other agencies in the region. These new increases allow for continued
investment in maintaining, replacing and modernizing aging infrastructure. The table below shows the
impact the rate changes have on a typical single-family residential customer. These amounts were
included in the Nov. 19, 2019, Staff Report (Attachment C). The effect on multi-family homes and
commercial accounts varies based on meter size and other factors.
Example of Monthly Bill
Jan. 1, 2019 Jan. 1, 2020 Jan. 1, 2021
Potable Water $68.81 $69.84 $71.33
Wastewater $27.81 $28.66 $29.52
Total Single Family Residential $96.62 $98.50 $100.85
City of Carlsbad -Carlsbad Municipal Water District
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 t
Council/CMWD Board Memo -Water and Wastewater Rate Changes Set for Jan. 1, 2021
Oct. 15, 2020
Page 2
COVID-19 Relief
During the COVID-19 pandemic state of local emergency, the following temporary relief measures for
ratepayers were established by the CMWD Board of Directors with Resolution No. 1639:
• Potable water service will not be discontinued due to non-payment
• Late fees will not be assessed
• Potable water business customers who closed their accounts due to the COVID-19 pandemic state
of emergency may discontinue water service, which will stop the accrual of any monthly fees
associated with having an active potable water service account; and when ready to reopen, may
have water service reestablished without paying a reconnection fee
The impact of these actions was a decrease in utility revenue of approximately $265,000. However,
staff expects impacted ratepayers to begin paying this amount back through payment plans at the
conclusion of the pandemic state of local emergency. In addition, not assessing late fees has resulted in
estimated lost revenue of approximately $300,000 since March 2020. The approximate annual revenue
that the city and CMWD receive in the three accounts totals $68 million.
Next Steps
On Jan. 1, 2021, the previously approved water and wastewater rates as shown in Attachments A and B
will go into effect.
Attachments: A. Water Rates in effect Jan. 1, 2021
B. Wastewater Rates in effect Jan. 1, 2021
C. Staff Report dated Nov. 19, 2019 (due to the size of this attachment, a hard copy is
available for review in the City Council Office)
cc: Scott Chadwick, City Manager/CMWD Executive Manager
Celia Brewer, City Attorney/CMWD General Counsel
Laura Rocha, Deputy City Manager, Administrative Services
Vicki Quiram, Utilities Director/CMWD General Manager
Kevin Branca, Finance Director
Ryan Green, Assistant Finance Director
Cheryl Gerhardt, Finance Manager
ATTACHMENT A
2021 WATER RATES TABLES
Ccarlsbad
Municipal Water District
Customers are assessed two fees monthly, a water delivery fee and a water usage fee.
Customer Class and Rate Type
ALL CUSTOMER CLASSES (except Fire Protection and Recycled)
Monthly Delivery Fee per meter size
5/8inch
314inch
1 inch
1.5 inch
2inch
2.5 inch
3inch
4inch
6inch
8inch
10inch
RECYCLED WATER
Monthly Delivery Fee per meter size
518inch
314inch
1 inch
1.5 inch
2inch
2.5 inch
3inch
4inch
6inch
8inch
10inch
FIRE PROTECTION
Monthly Delivery Fee per meter size
518inch
3/4 inch
1 inch
1.5 inch
2inch
2.5 inch
3inch
4inch
6inch
8inch
10inch
12inch
Monthly Base Rate
$25.52
$34.44
$52.28
$96.88
$150.40
$212.84
$275.28
$453.68
$899.69
$1,434.89
$2,059.30
$23.69
$32.69
$50.70
$95.73
$149.75
$212.84
$275.90
$455.93
$906.18
$1,446.47
$2,076.82
$7.93
$8.05
$8.30
$8.92
$9.66
$10.53
$1 .1.40
$13.89
$20.10
$27.55
$36.25
$57.37
Customer Class and Rate Type
SINGLE FAMILY RESIDENTIAL
Monthly Water Rates Per Unit ( 1 unit= 748 Gallons)
Tier 1 (0-10 Units)
Tier 2 (11-18 Units)
Tier 3 (19+ Units)
MULTI-FAMILY RESIDENTIAL
Monthly Water Rates Per Unit ( 1 unit= 748 Gallons)
Tier 1 (0-5 Units)
Tier 2 (6+ Units)
COMMERCIAL AND NON-RESIDENTIAL
AGRICULTURAL
IRRIGATION
RECYCLED WATER
Carlsbad Municipal Water District
Ccarlsbad
Municipal Water District
Monthly Base Rate
$4.13
$4.51
$7.18
$3.95
$5.04
$4.36
$4.71
$5.41
$3.79
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 I 760-431-1601 fax I www.carlsbadca.gov
2021 WASTEWATER RATES TABLES ATTACHMENT B
Customers are assessed one fee monthly, either a flat fee, a fee based on water usage,
or a per student fee.
{"city of
Carlsbad
Customer Class by Groups Monthly Base Rate
SINGLE FAMILY RESIDENTIAL
Flat Monthly Fee
Single Family Residential
Single Family w/Second Dwelling Unit
Per Unit of Water Used
RESIDENTIAL -OTHER
Multi-Family Residential
Mobile Ho'me
COMMERCIAL
Commercial -Group 2
Commercial -Group 3
Commercial -Group 4
Industrial Pretreatment Class Ill
BREWERIES
Brewery -Group 1
Brewery -Group 2
Brewery-Group 3
Brewery-Group 4
Per Student
SCHOOLS
Elementary
Junior High
High School
Boarding School
City of Carlsbad/Carlsbad Municipal Water District
$29.52
$44.28
$3.48
$3.48
$2.88
$4.38
$8.10
$4.82
$2.88
$9.34
$8.10
$11.60
$0.59
$0.87
$1.17
$6.09
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 I 760-431-1601 fax I www.carlsbadca.gov
Nov. 19, 2019 Item #16 Page 1 of 158
ATTACHMENT C
Meeting Date:
To:
From:
Staff Contact:
Subject:
Nov. 19, 2019
Mayor/ President and City Council / Board
Scott Chadwick, City Manager/ Executive Manager
Ligeia Heagy, Management Ana lyst
Ligeia. Heagy@carlsbadca.gov, 760-603-7360
Vicki Quiram, Utilities Director/ General Manager
Vicki.Quiram@carlsbadca.gov, 760-438-2722
CA Review~
Public Hearing for approval of a potable water rate structure
modification and proposed two-year rates for potable water, recycled
water and wastewater.
Recommended Actions
1. Hold a Public Hearing and Adopt a City Council Resolution approving two-year rates for
wastewater services; and
2. Adopt a Carlsbad Municipal Water District (CMWD) Resolution approving a potable water
rate structure modification and two-year rates for potable water and recycled water
services.
Executive Summary
On Dec. 18, 2018, the Board of Directors of the Carlsbad Municipal Water District (CMWD
Board) approved Resolution No. 1611 authorizing an agreement with Carollo Engineers, Inc.
(Carollo) for the 2019 Utilities Cost of Service Study (Study). The Study has been completed and
recommends revenue increases for wastewater and potable water services to provide
adequate funding for operations, maintenance and renewal of utilities infrastructure. Revenue
increases are met by rate increases and/or the use of fund reserves. Staff recommends using
both methods to mitigate rate impacts to customers.
For potable water, the Study recommends a 1% revenue increase effective Jan. 1, 2020, and
another 2% revenue increase effective Jan. 1, 2021. Potable water rates have been held flat for
the last two years. Staff recommends a combination of potable water rate increases and the
use of reserve funds to meet the revenue requirements in calendar years (CY) 2020 and 2021.
For recycled water, no revenue increase is needed at this time. Recycled water rates have also
been held flat for the last two years. Staff recommends that recycled water rates remain the
same through CYs 2020 and 2021.
Nov. 19, 2019 Item #16 Page 2 of 158
For wastewater, the Study recommends a 3% revenue increase effective Jan. 1, 2020, and
another 3% revenue increase effective Jan. 1, 2021. Wastewater rates have been held flat for
the last four years. Staff recommends a combination of wastewater rate increases and the use
of reserve funds to meet the revenue requirements in CYs 2020 and 2021.
The city and CMWD are required to notify customers at least 45 days in advance of a Majority-
Protest Public Hearing for City Council and the CMWD Board consideration of changes to the
rate structures and schedule of rates. On Sept. 17, 2019, the City Council and CMWD Board
approved setting the date of this Public Hearing for Nov. 19, 2019, to hold the Majority-Protest
Public Hearing and potentially approve the potable water rate structure modification and
proposed two-year utilities rates for potable and recycled water and wastewater.
Discussion
CMWD provides reliable, safe drinking (potable) and recycled water to homes and businesses
within a 32.3-square mile service area (Exhibit 6). There are approximately 30,170 potable and
recycled water connections within the service area. CMWD is estimating a 1% increase in
demand for fiscal year (FY) 2019-20 and a 1.8% increase by FY 2020-21. The demand increase is
due largely to new development.
The city provides wastewater services within a 30-square mile area (Exhibit 5). The wastewater
system meets stringent regulations as it conveys wastewater from homes and businesses to the
Encina Water Pollution Control Facility (EWPCF) for treatment. There are approximately 24,000
wastewater connections within the service area.
A portion of the water from EWPCF is further treated at the Carlsbad Recycled Water Facility
(CRWF) and is redelivered to customers through the CMWD recycled water system for
landscape irrigation and other industrial-type uses that require process water.
Cost of Service Study Process
Carollo recently completed the Study on behalf of the city and CMWD. The principal objectives
of the Study were as follows:
1) Water and Sewer Revenue Sufficiency Analysis -Develop multi-year forecasting
Microsoft Excel models for potable water, recycled water and wastewater. These
models contain the necessary data to determine the level of annual revenue required to
meet each system's projected annual operating, debt service and capital cost
requirements while maintaining adequate reserve levels.
2) Cost of Service Analysis -Complete a thorough cost allocation process to reflect the
appropriate distribution of system costs to system functions and ultimately rate classes,
based upon data such as average day, maximum day and peak-hour demands to ensure
a fair and equitable distribution of costs by rate classification.
3) Rate Calculation -Review each utility's existing rate structure and develop appropriate
modifications to ensure that rates reflect accepted industry practice and an equitable
distribution of costs, enhance transparency and adhere to cost-based pricing principles.
Nov. 19, 2019 Item #16 Page 3 of 158
Additionally, Carollo took a holistic look at each utility system and its relationship with each
customer class to ensure continued compliance with all applicable laws, including Proposition
218.
Potable and Recycled Water -Existing Rate Structures
The existing rate structures consist of a base monthly delivery charge and a volumetric usage
charge. The base monthly delivery charge is a fixed charge imposed regardless of water
consumption and is proportionate to the size of the customer's water meter. This fixed delivery
charge recovers operating costs such as staffing, customer service and utility billing, as well as a
portion of the infrastructure service costs including operations, maintenance and capital
replacement funding. The volumetric usage charge is based on actual water·consumption and
recovers the cost of purchased water, variable operating costs such as electricity and chemicals,
and approximately 50% of capital costs that are not funded using existing reserves.
Potable and Recycled Water -Proposed CY 2020 Rate Structure
The Study recommends one rate structure change for potable water -eliminating the Tier 3
category for the multi-family volumetric rate charge. Due to shifting customer demands, the
Tier 3 usage demand is very low (5%). Removing Tier 3 and adjusting the rates for Tier 2 ensures
the rate structure continues to reasonably reflect the proportional cost of providing service.
The Study does not recommend changes to the existing recycled water rate structure.
Potable Water Rates
Potable water rates were held flat for the last two years due to sufficient reserve
funding that met operating, maintenance and capital replacement costs. To meet the
Study's potable water revenue requirement, staff recommends a combination of
reserve funding and rate increases effective Jan. 1, 2020, and Jan. 1, 2021. Rates are
allocated to customer classes based on each class's proportionate share of the system,
which explains the va.riation in rate increases across customer classes.
The proposed increase in potable water rates is primarily driven by increases in the cost
of water purchased from the San Diego County Water Authority (SDCWA), increases in
cost of desalination water and increases in operating costs due to inflation.
CMWD is a member agency of SDCWA and purchases all its potable water from SDCWA.
This purchase comprises approximately 55% of CMWD's total annual Operating Budget
and includes 2,500 acre-feet annually of desalinated water, which is a local drought-
resilient water supply. SDCWA projected high increases in the cost of treated water for
FY 2019-20. However, SDCWA is mitigating rate impacts to member agencies through a
planned draw on their rate stabilization fund of approximately $22 million for FY 2019-
20 and $38 million for FY 2020-21.
Due to CMWD's specific allocated share of SDCWA fixed costs and projected water
purchases for FY 2019-20 and FY 2020-21, the effective increase in SDCWA purchase
costs for CMWD is approximately 3.5%. The SDCWA increase is primarily driven by:
Nov. 19, 2019 Item #16 Page 4 of 158
1) Decreased water sales demand forecast after the outcomes from drought
regulation and water conservation
2) An approximate 5% increase in Metropolitan Water District's (MWD) water rates
and transportation charges, which are passed-through via the SDCWA
3) Increased Capital Improvement Program (CIP) expenditures due to increases in
cost of steel and cement/concrete and shortage of skilled labor
4) Expenditures associated with shared reservoirs
5) Construction of new seawater intake-discharge facilities at the desalination plant
in Carlsbad to comply with updated environmental standards
The current and proposed potable water rates by customer class are shown in Exhibit 3.
Potable water is a very affordable beverage. Fifty dollars can purchase 3 gallons of brand
coffee, 8 gallons of brand soda, 15 gallons of milk, 45 gallons of bottled water or 7,256
gallons of CMWD water. A gallon of CMWD water costs less than a penny.
Recycled Water Rates
There will be no proposed rate increases for recycled water. Staff recommends
maintaining the current recycled water rates for CYs 2020 and 2021.
Wastewater Structure
There are no proposed changes to the existing wastewater rate structure. The Study does
recommend moving breweries into their own classes to establish rates that are commensurate
w ith their impact on the wastewater system. Brewery waste is typically very high in biochemical
oxygen demand {BOD) and total suspended solids {TSS) concentrations. The high
concentrations can lead to increased degradation of wastewater infrastructure and drive higher
treatment costs.
Customers would be migrated into one of four new brewery classes once their business is
identified as a brewery via the city's business license application process. Currently, there are
approximately 10 breweries in Carlsbad. Breweries will be placed into rate classes depending
on whether or not they also operate as a restaurant. The rates for each class are developed
based on the assumption that half of a user's wastewater is generated by brewing and half is
from the restaurant or general commercial operation (restrooms, breakrooms, etc.). The BOD
and TSS loading assumptions are adjusted for each type of user accordingly.
For breweries that haul their brewing waste offsite for treatment, those without restaurants
w ill be charged a rate equal to the C2 commercial rate, and those with restaurants will be
charged a higher rate. Breweries that fa ll into the B2 and B4 classes (those that do not haul
their brewery waste for outside treatment) would have higher rates than those that do haul
their waste for outside treatment.
The use of classes for breweries also assists staff in identifying these businesses, providing
outreach and ensuring that they are in compliance with waste discharge requirements. The
proposed new brewery classes are as follows:
Nov. 19, 2019 Item #16 Page 5 of 158
Bl -Brewery without a restaurant and hauls waste for outside treatment
B2 -Brewery without a restaurant and does not haul waste for outside treatment
B3 -Brewery with a restaurant and hauls waste for outside treatment
B4 -Brewery with a restaurant and does not haul waste for outside treatment
Staff reviewed brewery rates at neighboring agencies, and the proposed brewery rates are
reasonable in comparison. Additionally, staff hand delivered the rate notices, which explain the
new brewery classes and proposed rates, to each brewery. Also, staff has been working with
these businesses regarding requirements for placement into the Bl and B3 classes. In
recognition of the high concentration of waste produced, one brewery has already begun
diverting this waste stream and would therefore fall into the Bl or B3 class now.
Wastewater Rates
Wastewater rates have been held flat for the past four years, as the utility experienced lower
than anticipated expenditures for several years in a row that increased the reserves. The
recommended revenue increase is 3% effective for one year beginning Jan. 1, 2020, and 3% for
one year beginning Jan. 1, 2021. A portion of wastewater operating reserves will be used to
offset the rate increases.
The proposed rate increases are needed primarily for:
1. EWPCF's three-year 100% CalPERS retirement liability payoff
2. Increased energy and chemical costs
3. Capital budget for EWPCF infrastructure of $95 million over the next 10 years
4. Approximately $63 million over 15 years in the city's approved FY 2019-20 CIP
for assessment, repair and rehabilitation of the wastewater system to extend the
useful life of the system assets
5. Basic increases in the city's operating costs due to inflation
The current and proposed wastewater rates by customer class for wastewater are shown in
Exhibit 3.
Proposition 218 Notice
The City of Carlsbad and CMWD notified customers at least 45 days in advance of holding the
Public Hearing by mailing written notices of the proposed changes to the wastewater, potable
water and recycled water rate structures and schedule of rates to all property owners and
utility customers via U.S. mail on Oct. 1, 2019. The Public Hearing must be held a minimum of
30 days before changes to the rate structure or existing rates can be enacted. Customers have
the right to protest the changes by submitting their concerns in writing to the office of the city
clerk any time before close of tonight's Public Hearing.
If less than a majority of protests are received tonight, the City Council and CMWD Board may
consider the proposed changes to the potable water rate structure and schedule of rates for
wastewater, potable water and recycled water.
Nov. 19, 2019 Item #16 Page 6 of 158
Fiscal Analysis
If approved, the proposed potable water rate structure change and potable water and
wastewater rate increases will be effective Jan. 1, 2020, and Jan. 1, 2021, as described above,
and will provide adequate funding t o properly operate and maintain Carlsbad's water and _
wast ewater systems and maintain reserves. Exhibit 3 shows t~e current and proposed rate
changes for each utility.
Recommended Potable Water Rate Increase:
After holding rat es flat for the past two years, the Study recommends increasing potable water
revenue by 1% effective Jan. 1, 2020, and by 2% effective Jan. 1, 2021. For CY 2020, the 1% rate
revenue increase will impact each class differently due to the cost of service adjustment and
restructuring of the rates. For example, the Study's updated customer demand analysis found
that irrigation customers are responsible for slightly more peak usage costs than under the
current rate structure. Thus, the irrigation volumetric rate for CY 2020 has an increase above
the overall 1% rate revenue increase.
The Study also recommends adjusting the fixed delivery charges to account for shifting demand
patterns between classes, and to more closely align revenue collection with expenditures. For
example, the fixed delivery charge for a 5/8" meter is proposed to increase approximately
1.21% from $24.72 to $25.02, an increase of $0.30. The fixed delivery charge for a 3/4" meter is
proposed to increase approximately 1.20% from $33.36 to $33.76, an increase of $0.40.
The recommended increase in potable water rates is also influenced by the current desalination
rate associated with purchasing 2,500 acre-feet of water under the Uniform Member Agency
Purchase Contract (UMAPC). The current UMAPC desalination rate is approximat ely $2,788 per
acre-foot, in comparison to the SDCWA blended rate of approximately $1,750 per acre-foot.
Staff estimates the purchase of desalinated water would not have been necessary if customers
used water consistently at the winter demand level and did not exhibit a seasonal peak in
demand. Based on the supply cost allocation approach used in the Study, the cost of providing
desalinated water was allocated to customers that place a high-peak demand on the water
system, such as residential customers, above the average single-family residential winter water
use, agricultural and irrigation customers.
A target operating reserve of 40% of the Operations and Maintenance Budget, better than
anticipated financial results and long-range financial planning have helped temper the
recommended potable water rate increase by creating surplus operating reserves that CMWD
can utilize to reduce rate increases in the near-term.
Staff recommends using operating reserves to soften the potable water rate increases for the
next two years. Approximately 1.6% of reserves would be used during FY 2019-20 and
approximately 0.60% of reserves in FY 2020-21. If the rates were held flat for the next two
years, ratepayers would experience higher rate increases in future years to maintain reserves.
In addition to using operating reserves in FY 2019-20 for rate smoothing, approximately $2
million in capital reserves will be used to fund CIP projects. All proposed potable water rates are
shown in Exhibit 3.
Nov. 19, 2019 Item #16 Page 7 of 158
Recommended Recycled Water Rate:
No increase in recycled water revenue for the next two years is needed. Staff recommends
holding recycled water rates flat in CYs 2020 and 2021.
The recycled water volumetric rate is less than the potable water agricultural and irrigation
rates. The recycled water system provides a drought-resilient local supply, helps conserve
-potable water and reduces reliance on imported water. The recycled water rates are shown in
Exhibit 3 and reflect the utility's cost of providing services for CYs 2020 and 2021.
Recommended Wastewater Rates:
After holding the rates flat for the past four years, the Study recommends increasing
wastewater revenue by 3% for CY 2020 and an additional 3% for CY 2021. Staff recommends
using wastewater reserves over the next several years to partially offset rate increases.
Approximately 42% of operating reserves in FY 2019-20 and 1.3% of operating reserves in FY
2020-21 will be used to smooth rate increases. Additionally, $4.5 million of existing capital
reserves in FY 2019-20 and $13.8 million of existing capital reserves in FY 2020-21 will be used
to fund capital improvements. To maintain sufficient reserves, wastewater increases are
necessary in order to avoid a large increase later.
The proposed wastewater rates are shown in Exhibit 3 and reflect the utility's cost of providing
wastewater services for the next two years. The rates include new classes for breweries to
ensure cost recovery commensurate with their impact to the wastewater system.
Example Monthly Bill:
The following table provides an estimated monthly bill if the proposed increases are approved:
Current Bill Proposed Bill Proposed Bill
(Jan. 1, 2020) (Jan. 1, 2021)
Potable Water1a $68.81 $70.55 $72.42
Wastewater1b $27.81 $28.66 $29.52
Total Single Family Residential $96.62 $99.21 $101.94
1. Assumes an average single-family residence: a. Potable Water: 5/8" meter using 11 units per month, b. Wastewater:
Pays a flat monthly charge
Multi-Year Rates:
Proposition 218 requires noticing customers of the Public Hearing and potential changes to the
rate structures-and rate schedule. Using a multi-year rate approach and combining the noticing
spreads the costs among all three utilities, thereby increasing economies of scale.
While a 40% reserve funding level was established in the FY 2019-20 Operating Budget, the city
and CMWD will propose a more detailed reserve policy for utilities that uses additional best
practices and includes rate stabilization fund accounts.
7. Protest letters received as of Nov. 14, 2019
Nov. 19, 2019 Item #16 Page 8 of 158
Next Steps
If approved, the city and CMWD will implement a potable water rate structure modification and
two-year rates for wastewater, and potable and recycled water effective Jan. 1, 2020, for CY
2020, and Jan. 1, 2021, for CY 2021.
Staff will work with the City of Carlsbad's Finance Department to expand the current utilities
reserve policy for consideration during the FY 2020-21 budget process.
Environmental Evaluation (CEQA)
This project is exempt from the California Environmental Quality Act (CEQA) per State CEQA
Guidelines Section 15273(a) -modification, structuring, restructuring, or approval of rates,
tolls, fares, or other charges by public agencies.
Public Notification and Outreach
The California Constitution, Article XIIID, Section 6, states that local governments must hold a
Majority-Protest Public Hearing and notify property owners and customers at least 45 days in
advance of public hearings related to proposed water, recycled water and wastewater rates.
At the Public Hearing, if it is determined that a majority of affected customers and property
owners have submitted formal protests, the proposed fee changes must be rejected. This is a
requirement of Proposition 218, passed by California voters in 1996, to limit methods by which
local governments can create or increase taxes, fees and charges without taxpayer consent. Any
affected customers and property owners interested in objecting to the increases may file a
signed written protest with the office of the city clerk. The written protest must contain the
address of service, the rate change being protested and be received prior to close of the Public
Hearing. While protesters may appear at the hearing and be heard on the matter, only written
protests are considered as part of the majority protest.
Staff took the following actions at least 45 days prior to the Nov. 19, 2019, Public Hearing date:
• Notified affected customers and property owners by mail of the Public Hearing
• The Notice (Exhibit 3) provided information related to the Public Hearing proposed rates
• In addition, information about the Majority-Protest Public Hearing and proposed rates was
posted on the city's website at www.carlsbadca.gov/finance.
Information regarding public notifications of this item such as mailings, Public Hearing notices
posted in the newspaper and on the city website is available in the office of the city clerk.
Exhibits
1. City Council Resolution
2. CMWD Board Resolution
3. Notice of Public Hearing and Proposed Multi-Year Rates
4. 2019 Utilities Cost of Service Studies
5. City of Carlsbad Wastewater Service Area Map
6. CMWD Water Service Area Map
Nov. 19, 2019 Item #16 Page 9 of 158
RESOLUTION NO. 2019-244
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, APPROVING TWO-YEAR RATES FOR WASTEWATER
SERVICES.
WHEREAS, the California Constitution Article XIII D § 6(a)(2) requires local governments
hold a Majority-Protest Public Hearing and notify customers not less than 45 days in advance of
the Public Hearing before increasing in wastewater service rates; and
WHEREAS, the city is proposing wastewater service rate increases effective Jan. 1, 2020
and Jan. 1,2021;and
WHEREAS, On Oct. 1, 2019, Carlsbad residents and property owners were notified by mail
of the proposed new wastewater rates, thereby complying with the advance notice requirement
of 45 days; and
WHEREAS, on Nov. 19, 2019, the City Council of the City of Carlsbad held a Majority-
Protest Public Hearing regarding the increases in wastewater rates.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California,
as follows:
1. That the above recitations are true and correct.
2. That the City Council of the City of Carlsbad hereby approves the wastewater rate
increases of 3% effective Jan. 1, 2020, and Jan. 1, 2021.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City
of Carlsbad on the 19th day of November 2019, by the following vote, to wit:
AYES: Hall, Blackburn, Bhat-Patel, Schumacher.
NAYS: None.
ABSENT: None.
MA HALL, Ma or
IO~' Hec-w r.~z, Depv!j
1' BARBARA ENGLESON, City Clerk c;"tj
Cieri('
(SEAL)
Nov. 19, 2019 Item #16 Page 10 of 158
RESOLUTION NO. 1624
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CARLSBAD MUNICIPAL
WATER DISTRICT OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A
POTABLE WATER RATE STRUCTURE MODIFICATION AND TWO-YEAR RATES
FOR POTABLE WATER AND RECYCLED WATER SERVICES.
WHEREAS, the California Constitution Article XIII D § 6(a)(2) requires local governments hold a
Majority-Protest Public Hearing and notify customers not less than 45 days in advance of the hearing
before increasing water service rates; and
WHEREAS, the Carlsbad Municipal Water District (CMWD) is proposing a potable water rate
structure modification and two-year potable and recycled water service rates, effective Jan. 1, 2020, and
Jan. 1, 2021; and
WHEREAS, on Oct. 1, 2019, CMWD service area customers and property owners were notified by
mail of the proposed potable water rate structure modification and proposed two-year rates for potable
water and recycled water services; and
WHEREAS, on Nov. 19, 2019, the CMWD Board of Directors held a Majority-Protest Public Hearing
and approved the new potable water rate structure and two-year rates for potable water and recycled
water services.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of Carlsbad Municipal Water District
of the City of Carlsbad, California, as follows:
l. That the above recitations are true and correct.
2. That the Board of Directors of the Carlsbad Municipal Water District hereby approves the
potable water rate structure modification and two-year rates for potable and recycled water, effective
Jan. 1,2020,andJan. 1,2021.
PASSED, APPROVED AND ADOPTED at a Joint Special Meeting of the Board of Directors of the
Carlsbad Municipal Water District of the City of Carlsbad, California and the City Council of the City of
Carlsbad, California on the 19th day of November 2019, by the following vote, to wit:
AYES: Hall, Blackburn, Bhat-Patel, Schumacher.
NAYS:
ABSENT:
(SEAL)
Exhibit 3Nov. 19, 2019 Item #16 Page 11 of 158
Monthly Fire Protection Delivery Charge
Two Year Maximum Rate Increase
Current
Meter Size:
5/8" $7.69
3/4" $7,82
1• $8.06
1.5" $8.67
2· $9.39
2.5" $10.24
3• $11.10
4" $13.53
6" $19.61
8" $26.91
10" $35.42
12" $56.09
Wastewater Rates
1/1/2020
Proposed
$7.77
$7.89
$8.14
$8.67
$9.40
$10.33
$11.18
$13.62
$19.71
$27.01
$35.54
$56.25
1/1/2021
Proposed
$7.93
$8.05
$8.30
$8.92
$9.66
$10.53
$11.40
$13.89
$20.10
$27.55
$36.25
$57.37
Residential customers pay a flat monthly charge for waste-
water services, while most non-residential customers pay
a rate per unit of water used. The proposed wastewater
rate increase varies by wastewater customer class. The
proposed rate increase will pay for costs associated
with operations, maintenance, and replacement of aging
or failing infrastructure, as well as establishing and main-
taining an adequate operating reserve.
Brewery Rates
Previously Breweries were included in the Commercial
classes. Breweries will be moved into their own classes
and charged rates based on whether they also operate
a restaurant, and whether they haul their brewery
waste to a approved treatment facility for disposal.
The rates for each class are developed based on the
assumption that half of a user's wastewater is generated
by brewing and half is from the restaurant or general
operation (restrooms, breakrooms, ere.). The BOD and
TSS loading assumptions are adjusted for each type
of user accordingly. BODandTSS is hlghly corrosive to
sewer manholes and pipelines. Breweries that do not haul
their brewing waste off site for treatment will be charged
the applicable brewery rate.
Monthly Wastewater Rates
1/1/2020 1/1/2021
Current Proposed Proposed
Residential
Single Family $27.81 $28.66 I $29.52
Single Family $41.72 S42.99 I $44.28
w/2nd dwelling -Multi-Family $3.29 S3.38 $3.48
Mobile Home $3.29 $3.38 I $3.48
Commercial
Commercial II $2.70 S2.80 S2.88 --------;----+-----+----Commercial Ill $4.10 54.25 $4.38
Commercial IV $7.65 S7.87 $8.10
Schools
Elementary $0.55 S0.57
Junior High $0.82 S0.85
High School $1.10 S1.14
Boarding School SS.75 $5.91
Other
Nocurrenrcustome~ I $2.61 S2.88
Breweries
Brewery I• n/a $2.80
Brewery 2• n/a $9.07
Brewery3* n/a $7.87
Brewery4• n/a $11.26
' Group VIII -large Volume
, No current customers I n/a j n/a
Group IX -Industrial Pretreatment Class Ill
• NRG Plant I S4.53 I $4.68
*B1 and 83 Included in Commercial 2 or 3 previously
B2 and 84 included in Commercial 4 previously
$0.59
$0.87
$1.17
$6.09
$2.97
$2.88
$9.34
$8.1
S11.60
n/a
$4.82
IMPORTANT
~QTICE
Notice of Majority Pr~te~ Public Hearing
on Proposed Maxim Potable Water / and Wastewater Rat;nncreases
TUESDAY, NOV_' 19, 2019, AT 6 P.M.
City of Carlsbad
City Council Chambers
1200 Carlsbad Village Drive
Carlsbad, CA 92008
This notice contains information on proposed
changes to the water rate structure and proposed
multi-year rates for water and wastewater services.
For more information about the public hearing
process or the proposed changes, please call
760-602-2420, or visit the city's website at
www.carlsbadca.gov/finance.
Ccarlsbad
Municipal Wate r District
Nov. 19, 2019 Item #16 Page 12 of 158
Proposed Changes to Water and
Wastewater Rates
The Carlsbad Municipal Water District, a subsidiary district
of the City of Carlsbad, provides reliable safe drinking
water and recycled water within its service area, and
purchases 100 percent of its drinking water from the
San Diego County Water Authority (SDCWA). The cost
to purchase imported water continues to increase. The
District proactively plans for Increases in costs associated
with operations, maintenance, and replacement of
aging or failing infrastructure. To accommodate these
anticipated increases in cost, an increase in potable water
rates over the next two years is being proposed. Potable
water rates were held flat the last two years. No rate ·
increase is proposed for recycled water.
The City of Carlsbad owns and maintains a sanitary
sewer system that provides customers with wastewater
collection and conveyance services to a jointly owned
wastewater treatment plant (Encina). The City proactively
plans for increases In costs associated with operations,
maintenance, and replacement of aging or failing
infrastructure. n,e City also pays a percentage share of
the operation, maintenance, and capital replacement
costs at the Encina plant. To accommodate these
anticipated increases in cost, an increase in wastewater
rates over the next two years is being proposed. This
will be the first increase in four years, as the City has
successfully held rates flat for that time frame.
If the Carlsbad Municipal Water District Board of Directors
and the City of Carlsbad City Council approve the rate
increases at the public hearing on Nov. 19, 2019, tl1e new
rates for the upcoming year will be effective Jan. 1, 2020
and the second year will be effective on Jan. 1, 2021.
The proposed rates will enable the District and the
City to continue to provide quality services in a fiscally
responsible manner by funding ongoing operations,
maintenance, and replacement of the water and
wastewater system, as well as maintaining adequate
operating reserves.
How your Water Rate is Calculated
To meet the revenue needs for purchasing imported
water and maintaining the distribution system, the
proposed rate changes in the following tables are being
recommended. Proposed rates are allocated to each
customer class based on their proportionate use of the
water system.
There are two components to the water rates: the usage
charge and the mcinthly delivery charge. The usage
charge is the charge for the volume of water used. The
monthly delivery charge is a fixed charge based on the
size of the meter. Residential meters are typically 5/8" to
1•. Larger meters are primarily for larger water demands,
such as commercial buildings.
Monthly Potable Water Delivery Charge
Two Year Maximum Rate Increase
Meter Size:
5/8"
3/4"
1"
1.5"
2·
2.5"
3"
4"
6"
8"
10"
1 unit= 748 gallons
Current
S24.72
S33.36
$S0.62
$93.79
$145.58
S206.07
$266.52
S439.10
$870.76
$1,388.75
$1,993.06
1/1/2020
Proposed
$25.02
$33.76
$S1.25
$94.98
$147.4S
S208.67
$269.B8
$444.79
$882.05
$1,406.76
$2,018.92
Residential Water Rates
1/1/2021
Proposed
$25.52
$34.44
S52.28
S96.88
$150.40
S212.84
$275.28
$453.68
$899.69
$1,434.89
$2,059.30
Residential rates are grouped into tiers, with Tier l
having the lowest per unit rate and the Tier 2 having an
incrementally higher rate. The tier rate that is charged
depends on a customer's actual water usage. Tier 1
Is designed to meet water use essential for internal
residential use. Tier 2 is designed to meet exterior
landscaping requirements for typical residential
property. The water rate structure Is designed to be
more consistent with actual demand, ensure adequate
cost recovery for water services, and ensure adequate
reserve funding.
Non-Residential Water Rates
Non-residential customers have different water usage
needs than residential customers; therefore, the
usage charge is a flat per unit rate rather than a tiered
rate. Examples of non-residential customers include
commercial, agricultural, and irrigation.
Water Usage Charge
Two Year Maximum Rate Increase
1 unit= 748 gallons
11/1/2020 1/1/2021
($/unit) ($/unit) ($/unit)
Current Tier Current Proposed Proposed
Single Family Rates
Tier 1 (0-70 units) $3.94 S4.04 $4.13
ner 2 (>10) $4.69 $4.42 ,$4.51
Tier 3 (19+ units) $7.00 $7.04 $7.18
Multi-Family Rates
Tier 1 (0-5 units) $3.87 $3.87 $3.95
Tier2{>10) $4.67 $4.94 $5.04
Tier 3· (11 + units) $6.97 n/a n/a
Non-Residential Rates
Commercial S4.22 $4.27 $4.36
Agricultural Rates $4.53 $4.62 $4.71
Irrigation Rate $5.16 $5.31 $5.41
Recycled Water Rates
The recycled water rate will remain unchanged. The
recycled water cost is estimated based on the cost of
treatment, and operation and maintenance costs of the
distribution system, as well as adequate reserve funding.
Monthly Recycled Water Usage Charge
Two Year Rates
1 Unit= 748 gallons
Current
Recycled Water Rates I S3.7-9
Protesting the Rates
1/1/2020
Proposed
$3.79
1/1/2021
Proposed
$3.79
Monthly Recycled Water Delivery Charge
Two Year Rates
Current
Meter Size:
5/8" S 23.69
3/4" $ 32.69
1" S 50.70
1.5" $ 95.73
2" S 149.75
2.5" S 212.84
3" $ 275.90
4• $455.93
6" S 906.18
8" $1,446.47
10· $2,076.82
Fire Protection
1/1/2020
Proposed
$ 23.69
S 32.69
S 50.70
S 95.73
$ 149.75
S 212.84
S 275.90
S 455.93
S 906.18
$1,446.47
$2,076.82
1/1[2021
Proposed
S 23.69
S 32.69
S 50.70
S 95.73
S 149.75
$ 212.84
S 275.90
$455.93
$906.18
$1,446.47
$2,076.82
Some customers have separate fire meters and lines
for fire suppression sprinklers. The fire meters and
lines require maintenance, service, and a portion
of system capacity. The service connection size
is the basis of the charge and can be measured
either by the meter size or by the service line size.
In cases where a meter is installed, which restricts
the capacity of the connection and measures total
water consumption, the charges will be based on the
meter size. For fire lines that have a meter that is in
place only to inform the District when water is drawn
through the pipe and does not restrict water flows,
the charge will be based on the service line size.
Setting charges based on service connection size
ensures legal compliance and ratepayer equity.
As the property owner/ratepayer, you have the right to protest the proposed increases. Only one protest notice is allowed
per parcel. If you choose to protest, you must submira signed written protest to the City Clerk on or before the dose of
the hearing. The wr1tten protest must contain your full name and signature, parcel number, and the rate change being
protested. Email protests do not satisfy the signed written protesting requirement. If it is determined that a majority of
property owners have submitted a formal protest, the proposed fee change must be rejected. The protester may appear
at the hearing and be heard on the matter; however a written protest Is also required. Please send all protests to: Office
of the City Clerk, City of Carlsbad, 1200 Carlsbad VIiiage Drive, Carlsbad CA 92008.
Nov. 19, 2019 Item #16 Page 13 of 158
( City of
Carlsbad
Carlsbad Municipal Water District
Wastewater Cost of Service Study
FYE 2020 WASTEWATER
RATE STUDY
FINAL I October 2019
EXHIBIT 4
Nov. 19, 2019 Item #16 Page 14 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATE STUDY I CARLSBAD
Contents
Section 1 -Introduction
1.1 Study Purpose and Key Drivers
1.2 Background
1.2.1 Ongoing Water Conservatio_n Efforts
1.3 Project Approach
1.4 Project Findings and Recommendations
Section 2 -Assumptions and Data
2.1 Growth and Wastewater Usage
2.2 User Rate Categories
Section 3 -Revenue Requirement Analysis
3.1 Fiscal Policies
3.1.1 Fund Policies and Benchmarks
3.1.2 Operating Fund
3.1.3 Capital Fund
3.1.4 Bond Reserve
3.2 Debt
3.3 Capital Improvement Plan Funding
3.4 Operations and Maintenance Expenditures
3.5 Operating Revenues
3.6 Recommended Revenue Requirements
Section 4 -Cost of Service Analysis
4.1 Revenue Needs
4.2 Functional Allocation
Section 5 -Rate Design Analysis
5.1 Customer Allocation
5.1.1 Customer Class Loading and Allocation
5.2 Rate Design
Section 6 -Rate Comparison
i I OCTOBER 2019 I FINAL
1
1
1
2
2
3
5
5
5
7
8
8
8
9
9
9
9
11
12
12
14
14
15
17
17
18
21
23
Nov. 19, 2019 Item #16 Page 15 of 158
CARLSBAD I FYE 2020 WASTEWATER RATE STUDY I Wastewater Cost of Service Study
Appendices
Appendix A PROJECTED O&M COSTS
Appendix B Capital Improvement Plan
Appendix C REVENUE REQUIREMENT ANALYSIS
Appendix D FUNCTIONAL ALLOCATION
Appendix E WASTEWATER CUSTOMER ALLOCATION
Appendix F RATE DESIGN
Tables
Proposed Wastewater Rates by Customer Class
Capital Improvement Plan Expenditures($ millions)
Capital Improvement Plan Funding($ millions)
O&M Escalation Factors during Study Period
Operating Expenditures($ millions)
Current Rate Revenues($ millions)
Offsetting Revenues($ millions)
Revenue Requirement Summary($ millions)
Expenditures and Offsetting Revenues
Unit Cost Calculation
Loading Assumption by Class
Billed Usage by Customer Class for FY 2019/20
3
10
10
11
11
12
12
13
14
15
19
19
Table 1
Table 2
Table 3
Table 4
Table 5
Table 6
Table 7
Table 8
Table 9
Table 10
Table 11
Table 12
Table 13
Table 14
Allocation of Wastewater System by Customer Class (FY 2019/20) ($ millions) 20
Wastewater Rate by Customer Class 22
Figures
Figure 1
Figure 2
Figure 3
Wastewater Functional Allocation
Cost Allocation by Customer Class
Regional Monthly Single-Family Residential Rate Comparison
ii I OCTOBER 2019 I FINAL
16
21
23
Nov. 19, 2019 Item #16 Page 16 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATE STUDY j CARLSBAD
Abbreviations
BOD
Carollo
Ccf
CDFA
CEC
cf
CIP
CPUC
DWR
EDU
EWA
EWPCF
MFR
mgd
O&M
sou
SFR
SWRCB
TSS
Biological Oxygen Demand
Carollo Engineers, Inc.
Hundred cubic feet
California Department of Food and Agriculture
California Energy Commission
cubicfeet
Capital Improvement Plan
California Public Utilities Commission
Department of Water Resources
Equivalent Dwelling Unit
Encina Wastewater Authority
Encina Water Pollution Control Facility
Multi-Family Residential
million gallons per day
Operation and maintenance
Second dwelling unit
Single Family Residential
State Water Resources Control Board
Total Suspended Solids
FINAL I OCTOBER 2019 I iii
Nov. 19, 2019 Item #16 Page 17 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
-This Page Intentionally Left Blank-
iv I OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 18 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
1 Introduction
The City of Carlsbad (Carlsbad or the City) has undertaken a comprehensive cost-of-service rate design
study for its wastewater utility. This report summarizes the study approach, key findings, and
recommendations for the wastewater utility and detailed review of the cost-of-service methodology and
rate designs. In addition, a survey of wastewater rates has been conducted to compare the City's rates
with other regional cities/agencies.
This study includes an assessment of both the City's wastewater user rates and capacity fees. The
wastewater user rates and capacity fees are designed to distribute the cost of the operation and
improvement of the Encina Water Pollution Control Facility (EWPCF) equitably among all users in
accordance with California legal requirements as defined by Proposition 218 and California Government
Code §66013, respectively.
1.1 Study Purpose and l{ey Drivers
Several factors influence the need to conduct a comprehensive cost-of-service rate design study.
Identifying these issues upfront defines the strategic intent needed to complete this project successfully.
These issues include the following:
• The majority of the southwestern United States lies within a desert with scarce water resources.
Rapid population growth, potential climate changes, below average rainfalls, court mandated
delta flow restrictions, and the State's continuous water conservation effort have compounded
this scarcity.
• The State of California requires that all utility rates meet the cost-of-service requirements
imposed under Proposition 218. These principles underlie the approach to rate setting such that
all customers are charged rates that are fair and equitable based on the demands that each
customer class places on the system.
• The City has a set of clearly defined fiscal policies designed to promote the fiscal health of the
utility, including reserve requirements and debt coverage requirements. These fiscal policies are
not only designed to allow the utility to meet the level of service objectives, but also allow the
utility to mitigate potential rate spikes or cash flow deficiencies despite unexpected revenue
shortfalls.
1.2 Background
The City of Carlsbad is located in northern San Diego County, in southern California with a population of
over 100,000. The City maintains a separate wastewater enterprise fund with its own operating and
capital reserves.
The City provides wastewater service to roughly two thirds (2/3) of the City's population and is
responsible for the collection and conveyance of sewer discharges to EWPCF. This facility is jointly
owned by the cities of Carlsbad, Vista, Encinitas, the Buena Sanitation District, Vallecitos, and Leucadia.
EWPCF provides full secondary treatment, sludge handling, and disposal through a deep ocean outfall
that extends along the ocean floor to a point 1.5 miles off shore. Based on the City's customer data,
FINAL I OCTOBER 2019 I 1
Nov. 19, 2019 Item #16 Page 19 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
return to sewer factors given water usage, and certain reduction factors given current drought
conditions, the City's average daily wastewater flow is roughly 7 million gallons per day (mgd).
The City currently has approximately 24,000 active sewer accounts, consisting of single family
residential, multi-family residential, commercial, other, brewery, industrial, and schools.
1.2.1 Ongoing Water Conservation Efforts
After more than 5 years of drought in California, the Governor issued Executive Order B-40-17 in April
2017 ending the drought state of emergency in most of California. Precipitation and snowpack in water
year 2017 have fi lled the majority of California's lakes, rivers, and major reservoirs. However, long-term
conservation among Californians, improving water use efficiency, and strengthening local and regional
drought planning are still critical to the State's resilience to drought and on-going climate change. From
a wastewater perspective, flows would also decrease due to customers being water efficient, which in
turn can increase wastewater strengths and odor control costs, among other issues.
Directed by the Governor's Executive Order B-37-16 in May 2016, five State agencies-includ ing the
Department of Water Resources (DWR), State Water Resources Control Board (SWRCB), California
Public Ut ilities Commission (CPUC), California Department of Food and Agriculture (CDFA), and
California Energy Commission (CEC)-have developed a longer-term water conservation framework to
enhance the resilience against climate and drought. Although the drought state of emergency lifted
earlier this year, this framework will continue to guide the utilities to prohibit wasteful water use, manage
the water resources, and conserve a reliable water supply for the future.
1.3 Project Approach
Rate analyses are typically performed periodically so that revenues from rates adequately fund utility
operations and maintenance (O&M) and capital investments. Additionally, in California, water rates must
adhere to the cost-of-service requirements imposed by the State Constitution. California Constitution
article XIII D, Section 6 (Article XIII D) requires that property-related fees and charges, including water
rates, do not exceed the reasonable and proportional cost of providing the service. Article X, Section 2, of
the State Constitution establishes the need to preserve the State's water supplies and discourage the
wasteful or unreasonable use or reasonable method of use.
To achieve these requirements, a comprehensive rate study typically consists of the following
progression of three interconnected processes.
,Revenue.Requirement Analysis
~~'1'"""'.~T7>': ~~'1a,~ . . . .·· . ,:--· -•C,:ompares·ex°isting r~venues of tne utility to its operating;capital, and'pol!cy_: . f" driven costs to establish the adequacy of.t~E; existin~ cost recovery levels; · · ··
-~-Co~!:of-sery
' •_Identifies and apportions annual revenue requirements to functional rate '
components based on its application of the utility system.
~•Cons1aers' lfotn tHe level ano structure of tlie rate es1gn to collect'tlie. ,,_,_,cl, ... u ,. , \~ .. I, ~ • .. ,_ .. ,tr distributed revenue requirements fr9m ea,ch cjass of ~ervi_ce> · .,_. ·:-,. ,,
-, ... ~'-L'.· :·p . t - . i_i
2 I OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 20 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
1.4 Project Findings and Recommendations
Based on the analysis projections, the City will need to increase wastewater rate revenues to keep pace
with inflationary cost increases and necessary capital improvements to the City's systems and at Encina.
The use of reserves to fund a share of capital projects will help to minimize the necessary level of rate
increases. It is recommended that the City reviews its revenues and expenditures on an annual basis to
verify that the implemented rates are adequately recovering costs.
The key findings and recommendations are as follows:
• Proposed Rate Increases. Annual user rate revenue increases of 3.0 percent will be required in
each year of the study period to fund the activities of the City's Wastewater Department. The
proposed user rates largely retain the City's current rate structure and will include a cost of
service adjustment in FY 2019/20 based on the updated cost of service allocations followed by an
across the board increase in FY 2020/21.
• Minimum Operating Reserve. It is recommended that the City continues to complete financial
planning based on the current operating reserve policy that sets a minimum operating reserve of
40 percent of annual operating expenses. In the future, the City could consider this policy to
increase the minimum reserve target with Council approval or implementing a best practices
target above the 40 percent minimum for financial planning.
• Implement Brewery Specific Rates Classes. The proposed rate structure includes several new rate
classes for breweries that are designed to reflect the unique wastewater discharges that
different types of brewing operations generate. The City plans to work with brewers through the
implementation process to place each customer into the appropriate category based on their
operation and offer guidance on how they can mitigate costs by hauling brewing waste offsite
for treatment.
• Recommended Update to Flow and Loading Assumptions. It is recommended that the City
conduct a flow and sampling analysis starting prior to the next master plan, to update the flow
assumptions, Biological Oxygen Demand (BOD) and Total Suspended Solids (TSS) loadings
concentrations assumptions, return to sewer factors, and the Equivalent Dwelling Unit (EDU)
definition for each customer category. These updates would subsequently be used in the next
update of both user rates and capacity fees.
Table 1 outlines the recommended wastewater charges for FY 2019/20 and FY 2020/21.
Table 1 Proposed Wastewater Rates by Customer Class
GROUP!
SFR(l> $27.81 $28.66 $29.52
Single Family with 2nd dwelling<ll $41.72 $42.99 $44.28
MFR/MOBILE HOME (per ccf) $3.29 $3.38 $3.48
Multi-family residential (per ccf) $3.29 $3.38 $3.48
FINAL I OCTOBER 2019 I 3
Nov. 19, 2019 Item #16 Page 21 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
II. I FY 2019/20 I FY 2020/21
nt Rates 3.0~with COS 3_0%
, Adjustment
GROUP II -Commercial 2 (per ccf) $2.70 $2.80 $2.88
GROUP Ill -Commercial 3 (per ccf) $4.10 $4.25 $4.38
GROUP IV -Commercial 4 (per ccf) $7.65 $7.87 $8.10
GROUPV
Elementary School (per student) $0.55 $0.57 $0.59
Junior High School (per student) $0.82 $0.85 $0.87
High School (per student) $1.10 $1.14 $1.17
Boarding School (per student) $5.75 $5.91 $6.09
GROUP VI-Large Volume (no account)
Breweries
Bl -Brewery without a restaurant and n/a $2.80 $2.88 hauls waste for outside treatment
B2 -Brewery without a restaurant that
does not haul waste for outside n/a $9.07 $9.34
treatment
B3 -Brewery with a restaurant and n/a $7.87 $8.10 hauls waste for outside treatment
B4-Brewery with a restaurant that
does not haul waste for outside n/a $11.26 $11.60
treatment
Industrial Pretreatment Class Ill $4.53 $4.68 $4.82
Note:
(1) Indicates a flat monthly charge.
4 I OCTOBER 2019 I FINAL
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Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
2 -Assumptions and Data
This cost-of-service analysis accounted for fund balances, interest earnings, use of capacity fees, deposits
and withdrawals to the capital fund, and tracked the operating fund as a method of assessing the impacts
of adjustments to wastewater rates.
Data were provided by the City as the basis for the analyses for the rate study. The data included fiscal
policies and practices, historical and projected O&M expenditures, operating transfers, non-operating
revenues, debt service requirements, replacement funding, capital improvement needs, and customer
data. Based on the review of the data, a number of assumptions was developed and used as the basis for
performing the cost-of-service and preparation ofthe rate design. This section outlines these
assumptions as well as the limitations of the study.
2.1 Growth and Wastewater Usage
Based on staff projections, Carlsbad's population is expected to grow to approximately 130,000 by FY
2034/25. This population is considered the bu ild-out population for the purposes of this analysis. This
represents an increase of approximately 13 percent in total over the current rounded population of
116,000. It is expected that wastewater discharges will grow at a commensurate level over the same time
period.
2.2 User Rate Categories
Carlsbad classifies its wastewater customers as follows:
•
•
•
•
•
•
•
•
C c::1,-"11·
Group I
-Single family residential (SFR)
-Single family residential with second dwelling unit
Mobile Home
Multi-Family Residential
Group II -Commercial 2
Group Ill -Commercial 3
Group IV -Commercial 4
Group V -Schools
Elementary Schools
-Junior High Schools
High Schools
Boarding Schools
Group VI -Large volume (no account)
Breweries
Bl-Brewery without a restaurant and hauls waste for outside treatment
82 -Brewery without a restaurant that does not haul waste for outside treatment
83-Brewery with a restaurant and hauls waste for outside treatment
84-Brewery with a restaurant that does not haul waste for outside treatment
Industrial pretreatment class Ill (desalination plant)
FINAL I OCTOBER 2019 I 5
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CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
SFR customers are charged a fixed monthly fee. SFR with a second-dwelling unit (SDU) will have a higher
fixed monthly fee discussed later in this report. All commercial groups and group VI customers are
subject to a volumetric charge based on water usage. Schools are charged based on the number of
students.
The volumetric charges vary between customer classes based on each class's assumed flow and loadings.
Wastewater customers' effluent discharges are not individually metered; instead, each user's discharges
are estimated using wastewater billing records and/or metered water consumption records and assumed
strength characteristics. The City's billing system has a detailed listing of historic water consumption by
customer, property use classification, and month. The study recommends moving the breweries into
their own class to establish a rate that is commensurate with their impact on the wastewater system.
Brewery waste is typically very high in BOD and TSS concentrations. These high concentrations can lead
to increased degradation of wastewater infrastructure and drive higher treatment costs.
Customers would only be migrated into this class once they are confirmed as being a brewery, and only if
they discharge brewing related waste into the wastewater system. Breweries that haul brewing waste for
treatment at Encina Wastewater Authority (EWA) or another approved plant would be charged the
otherwise applicable rate rather than the brewery rate.
Customers in the Brewery category are split into separate rate classes based on whether or not they also
operate as a restaurant. The rates for each class are developed based on the assumption that half of a
user's wastewater is generated by brewing and half is from the restaurant or general commercial
operation (restrooms, breakrooms, etc.). The BOD and TSS loading assumptions are adjusted for each
type of user accordingly. Breweries who do not haul their brewing waste offsite for treatment will be
charged the applicable brewery rate that reflects the estimated strength of the wastewater that they
discharge to the system.
For breweries who haul their brewing waste offsite for treatment, those without restaurants will be
charged a brewery rate that is equal to the C2 commercial rate since it is assumed that all of their
wastewater discharges come from general commercial activities. Breweries with restaurants who haul
theoir brewing waste fo r offsite treatment will be charged a brewery rate that is equal to the C4
commercial rate, the standard rate for restaurants.
The Group VI -Large Volume rate category is currently not in use as the only customer in this category is
located outside the service area and no longer has a business presence within the City. Carollo Engineers,
Inc. (Carollo) recommends removing this customer class from the cost-of-service study as it would result
in a rate based solely on estimates and not data. A rate will be developed in the future if there are new
customers that fall within this category.
6 I OCTOBER 2019 I FINAL
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3 -Revenue Requirement Analysis
The revenue requirement analysis sets the basis for short-and long-term rate planning. More
importantly, the analysis serves as a means of evaluating each cost center's fiscal health and adequacy of
current rate levels. If revenue projections under ex'isting rates do not meet forecasted requirements,
rates need to be adjusted.
At the foundation of any utility rate study is a revenue requirement, which uses projected cash flows and
debt service requirements to project revenue shortfalls. Using historical records, future O&M
expenditures were projected. Ongoing expenditures were escalated annually on a line-item basis using a
range of escalation factors.
For example, variable costs like power were increased not only by general cost inflation but also with
increases in utility demands (see the section on operating and maintenance expenditures for more
information). Non-operating revenues and expend itures were also evaluated. The City's CIP was
incorporated as detailed in the capital improvement section.
Using these projections, a financial model was developed incorporating the preceding tasks and
assessing the forecasted revenues through a cash flow sufficiency test. A revenue requirement projection
for total service operations was therefore established. The model consists of a functional set of methods
and data that align with the utility's objectives.
The adequacy of the existing rate structure can be measured by comparing revenue requirement
projections against revenue projections under existing rates. If revenue projections under existing rates
do not meet forecasted requirements, rates need to be adjusted.
There are two sufficiency tests utilized to define the necessary annual revenues: the (1) cash flow and (2)
debt coverage tests. These sufficiency tests are commonly used to determine the amount of annual
revenue that must be generated from an agency's rates.
• Cash Flow Sufficiency Test: A utility must generate annual utility revenues adequate to meet
annual expenditure obligations of the utility. The cash flow test identifies projected cash
requirements in each given year. Cash requirements inclu de O&M expenses, debt service
payments, replacement funding, additions to fund balances, and rate funded capital
expenditures. These expenses are compared to total annual projected revenues. Revenues that
are available to meet this requirement include user ra~e revenue, interest earnings, non-
operating revenues, and miscellaneous revenues. Shortfalls are then used to estimate needed
rate increases.
• Bond Coverage Test: Annual rate revenues must satisfy debt coverage obligations. It measures
the ability of a utility to meet both legal and policy-driven revenue obligations. When a
municipality issues a bond, the official statement dictates the financial obligations that must be
met in order to remain in legal compliance. This official statement lists off bond covenants,
including a coverage factor. Coverage factors are usually set at a level between 1.0x to 2.0x of
annual debt service. The official statement also lists eligible revenues and expenditures to be
included in the coverage test. The coverage test does not include policy expenditures (i.e.,
additions to meet minimum fund balances and depreciation fund ing), capital expenditures, or
capacity fee revenues.
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Revenues must be sufficient to satisfy both the cash flow and coverage tests. If revenues are found to be
deficient through one or both of the tests, then the greater deficiency (shortfall) drives the rate increase.
Currently, the City has no debt and has no plans to issue debt during the study period. Consequently, the
cash flow test will drive the City's revenue requirements over the next five years.
3.1 Fiscal Policies
As a part of the Revenue Requirement Analysis, the utility's fiscal policies were reviewed and evaluated in
relation to capita l funding and appropriate levels for the operating, capital and bond reserves. Based on
the results of this review, these policies were incorporated within the financia l model by tracking fund
balances, interest earnings, use of capacity fees, deposits and withdrawals to funds, and tracking the
operating fund as a way to assess the impacts of adjustments to wastewater rates.
3.1.1 Fund Policies and Benchmarks
Utility fund policies are intended to be implemented as a measure of safety and security against future
events that may negatively impact the utility's financia l health. Fund balances can address variability and
timing of expenditures and receipts, as well as occasional disruptions in activities, costs, or revenues. The
general objectives of these polic ies are to facilitate stable and predictable rates and funding sources,
along with equitable recovery of costs from customers as they are being incurred (or accrued). Overall, a
utility's fund policies are a collection of rules and gu idelines. The collective use of individual funds will
allow the utility to minimize its exposure to revenue shortfalls and coverage defaults.
The City currently has a minimum target balance for its operating reserve set at 10 percent of annual
operating expenditures. The City's operating capital reserves remain well above the minimum target
balance, and the City will be using both operating and capital reserves to pay for capital projects for the
five-year study period.
3.1.2 Operating Fund
Carlsbad practice states that the utility should maintain a minimum balance for this fund equivalent to 10
percent of annual operating expenditures. As of the beginning FY 2019/20 fund balance is over 40
percent of annual operating expendi~ures.
The operating fund provides a minimum year-end unrestricted fund balance needed to accommodate
the cyclical nature of revenues and expenses. It provides a "cushion," which can be used to cover cash
balance fluctuations. This fund is intended to address both anticipated and unanticipated changes in
revenues and expenses. Anticipated changes may include billing and receipt cycles, payroll cycles, and
other payables. The operating fund can be used to meet cash deficiencies due to unanticipated changes
in usage, unforeseen expenditures, or drops in revenues.
The fund's target balance is characterized as a percentage of annual expenditures set at a level
commensurate to t he potential shortfall in revenues, based on the relative volatility of revenues of the
uti lity's volume based rate structure. In general, utilities that recover a significant portion of their costs
through volume charges will experience greater fluctuations in revenues due to seasonal usage patterns
and will face a greater degree of revenue risk than a utility with a flat rate structure. As noted, under
Carlsbad's current rate structure, single family residential customers and schools are charged a flat
monthly charge for sewer services and all other customers are charged on a volumetric basis.
Carlsbad should prepare itself for potential revenue volatility by maintaining an operating fund balance
that meets or exceeds the minimum target fund balance, as set by utility practices.
8 I OCTOBER 2019 I FINAL C c;:,r-••~·
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The operating fund will be used to cover capital projects during the study years.
3.1.3 Capital Fund
In addition to resources designed to protect against variations in operating costs and revenues, a capital
fund can help meet the cost of capital projects, repairs, replacements, and unexpected emergency capital
outlays. While it would be impractical to reserve against major system-wide failures such as a
catastrophic earthquake (utilities often hold insurance policies for such catastrophic events), it is
reasonable and prudent to identify and quantify possible failures of individual system components.
The City uses system reinvestment as the mechanism to determine capital funding levels. This provides a
relatively stable and predictable source of funding for capital projects. Depreciation is a commonly used
benchmark for system reinvestment.
The City funds depreciation by making annual contributions into the capital fund, which may then be
used to fund repair and replacement projects within the City's CIP. Based on the wastewater asset data
provided, annual depreciation amounts to $55.1 million in FY 2018/19. By using funds from the Capital
f und, the City has been able to fully fund their CIP and maintain stable impacts on rates by collecting
annual depreciation rather than setting rates to meet fluctuations in annual capital spending.
There are four major sources of funding for this capital balance: contributions from other agencies
(specif ically, the City of Vista), capacity fee revenues, interest , and depreciation funding.
In addition to the Operating Fund, the capital fund will be used to meet capital needs and in cash funding
a larger portion of its projected capital repair and replacement program during the study years. This will
save the wastewater utility ratepayers money.
3.1.4 Bond Reserve
The City has no current debt, thus no funds in the Bond Reserve.
3.2 Debt
The City has no current debt and has no plans to issue debt during the study period.
3.3 Capital Improvement Plan Funding
The City developed the current Capital Improvement Plan (CIP) to meet the ongoing major repair,
replacement, and expansion requirements of the wastewater system. The City categorizes its expansion-
related projects as 'connection projects' and replacement-related projects as 'replacement projects.'
The City has budgeted $22.7 million for 26 replacement projects for the next five years. In addition, there
are projects associated with the EWA's general improvement project s and planned asset replacements
totaling approximately $29.1 million. The City also has budgeted $7.2 million for 11 connection projects
for t he next five years. Table 2 shows the proj ected CIP project costs for FY 2019/20 through FY 2023/24.
The funding analysis includes a 3.5 percent per year capital cost escalation factor to account for increases
in construction and cont racting costs starting in FY 2020/21.
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CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Table 2 Capital Improvement Plan Expenditures($ millions)
FY2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Connection Fee Fund Projects I $1.63 $2.80 $0.32 $2.11 $0.32
Replacement Fund Projects I 5.16 10.28 2.68 2.35 2.25
Encina Capital Projects I 5.29 6.23 5.13 5.92 I 6.56 I
Total Wastewater Projects I $12.07 $19.31 $8.13 $10.39 $9.13 -
I TOT AL ESCALATED COST $12.07 I $19.99 $8.71 $11.52 $10.48
* Lme or column totals may not tie due to rounding
The City frequently adjusts this CIP based on engineering and planning needs for the wastewater system.
For the purposes of this rate analysis, only annual depreciation funding will be recovered each year
directly through rates. Funds are available within the operating reserve above the 40% policy target,
additional transfers may be made from the operating fund to pay for CIP projects. When significant
changes are made, Carlsbad will need to evaluate funding mechanisms (i.e., reserve balances, capacity
fee revenues, etc.) and t he timing of projects within its CIP to develop an optimized funding strategy
while mitigating any unnecessary rate impacts.
Table 3 shows projected sources of funds for connection fee projects as well as the resulting capital funds
balance. The t(ansfers and replacement funding line item represents the transfer of operating revenues
to the capital reserve for depreciation funding as well as additional transfers for cash funding of capital.
As shown in the tables, the City plans to draw on t he reserves to fund CIP projects over the next several
years.
Table 3 Capital Improvement Plan Funding($ millions)
I
FY2019/20 FY 2020/21 FY2021/22 FY 2022/23 FY 2023/24
Beginning Capital Funds Balance I $33.17 $28.71 $14.95 $12.33 $9.36 (Connection Fee and Replacement)
Transfers and Replacement Funding 6.78 4.76 4.87 6.80 6.54 ·--
Interest 0.42 0.36 0.22 0.20 0.17
Connection Fees 0.43 0.43 0.43 0.43 0.43
Use of Funds for Projects I $(12.07) $(19.31) $(8.13) $(10.39) $(9.13)
Year-End Balance $28.71 $14.95 $12.33 $9.36 $7.36
Change in Reserves $4.45 $13.76 $2.62 $2.97 $2.00
* Lme or column totals may not t,e due to rounding
An important aspect of the capital funding plan is that the City intends to draw on both existing
replacement reserves and existing connection fee reserves to fund capital projects. Since the
implementation of the City's existing connection fees, reduced volumetric discharges due to
conservation and changes in planned developments have reshaped the CIP projects that are necessary to
serve new users. While some of the projects init ially conceived and included in the connection fees have
changed, other projects have been modified or expanded to take their place. Further, replacements and
upgrades to the City's existing infrastructure are required to maintain the assets that serve new users and
to maintain the excess system capacity that will be needed to serve users that have not yet connected to
the system. To these ends, the City plans to allocate existing connection fee reserves, as well as a share
of future connection fees, to pay for replacement projects that have an excess capacity component. The
City will be updating their connection fees in a future study later this year.
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3.4 Operations and Maintenance Expenditures
The cost-of-service analysis utilizes City's FY 2017/18 budgets as the basis for forecasting future revenue
needs. O&M expenditures are assumed to increase commensurate with cost inflation and projected cost
increases associated with increases in wastewater flows due to growth and higher treatment standards.
Revenues and expenses are projected for future fiscal years using the annual escalation factors shown in
Table 4.
Table 4 O&M Escalation Factors during Study Period
• FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY2023/24
General Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
Labor Inflation 3.0% 3.0% 3.0% 3.0% 3.0%
Labor -PERS (Normal Cost) 12.4% 13.2% 13.2% 13.2% 13.2%
Labor -Health Insurance 7.5% 7.4% 7.1% 6.9% 6.6%
Chemicals Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
Utilities Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
~
Construction Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
Property Tax Increase 4.3% 3.8% 3.1% 3.7% 2.9%
Depreciation Funding I 2.8% 2.1% 1.2% 1.2% 1.2% -I-
I Interest Earnings 2.1% 2.2% 2.3% 2.4% 2.5%
Customer Demand Growth 1.0% 0.9% 0.6% 0.2% 0.2%
Gnrl lnfltn + Cstmr Dmnd Grwth 3.5% 3.4% 3.1% 2.7% 2.7%
No Annual Increase I 0.0% 0.0% 0.0% 0.0% 0.0%
One Time Expense -100.0% I -100.0% -100.0% -100.0o/o -100.0o/o
* Line or column totals may not tie due to rounding
The City transports its wastewater flows to EWA for treatment and has budgeted $4.1 million for EWA
services for FY 2019/20. The California Public Employees Retirement System (PERS) defines the
Unfunded Accrued Liability (UAL) as is the amortized dollar amount needed to fund past service credit
earned (or accrued) for members who are currently receiving benefits, active members, and for members
entitled to deferred benefits, as of the valuation date. The UAL is not included in the $4.1 million and
instead is an additional $953,000. These cost s are expected to increase with general inflation and
customer demand growth. Table 5 presents a summary of the projected operating expenditures for FY
2019/20 through FY 2023/24.
Table 5 Operating Expenditures($ millions)
FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY2023/24
Personne I $ 2.44 I $ 2.56 $ 2.67 $ 2.78 $2.88
Maintenance and Equipment 3.31 2.32 2.37 2.42 2.47
Encina Services (inc, Encina I
Pension Payoff) 5.06 5.19 5.33 4.23 4.34
---Depreciation Funding 3.80 3.90 3.99 4.09 4.19
Transfer to Capital Fund 2.98 -----Total Operating Expenses $17.58 $13.97 $14.36 $13.52 $13.89
* Lme or column totals may not tie due to roundmg
I
I
I
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If the actual escalation factors are greater than projected, the City could potentially pass through some
additional costs to its customers in accordance with California Government Code §53756, which will help
offset unforeseen costs and promote the fiscal stability of the wastewater utility.
3.5 Operating Revenues
Operating revenues are projected from budgeted revenues based on the escalation factors shown in
Table 5. Table 6 shows the projected user rate revenues based on the current rates and prior to the
inclusion of any rate increases for FY 2019/20 through FY 2023/24. This base level of rate revenue is
expected increases modestly over the study period based on the expected level of growth in customer
accounts.
Table 6 Current Rate Revenues($ millions)
Sewer Pre-Treat
TOTAL WASTEWATER RATE REVENUES $13.76 $13.88 $13.97 $14.00
0.03
s14.02 1
,. Line or column totals may not tie due to rounding
In addition to above rate revenues, the City also receives other offsetting revenues that can be used to
decrease the amount of revenues needed from user rates. Table 7 summarizes the projected offsetting
revenues for the wastewater fund.
Table 7 Offsetting Revenues($ millions)
FY FY FY FY FY
2019/20 2020/21 2021/22 2022/23 2023/24
Fines & Forfeitures $0.09 $0.09 $0.09 $0.09 $0.09
Income from Prop & Investments I 0.16 0.10 0.10 0.11 0.11
1 Interdepartmental 0.08 0.09 0.09 0.09 0.09
I Other Revenues 0.07 0.08 0.08 0.08 0.08
I TOT AL OFFSETTING REVENUES $0.41 $0.35 $0.36 $0.37 $0.37 I
-
----* Line or column totals may not r,e due to roundmg
3.6 Recommended Revenue Requirements
Rate revenue increases will be necessary in order to meet the City's projected operating and capital
funding needs. Annual rate revenue increases of 3-percent will enable the City to continue to fully fund its
capital program and meet its debt service requirements. Furthermore, by initiating annual increases now,
the City can mitigate larger increases in the fut ure and avoid the need for substantial debt issuances.
Though the financial analysis included projection for a five-year period, the City only intends to adopt
rates updated for FY 2019/20 and FY 2020/21. Table 8 below summarizes the revenue requirement
projection.
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Table 8 Revenue Requirement Summary($ millions)
I
FY FY FY FY FY
2019/20 2020/21 2021/22 2022/23 2023/24
Pre-Rate Increase
~~nues_w_i-th_o_u_t-ln-c-re_a_s-es-----+-$-1-3-.7-6_...__$_13_.8_8_+--$13.97 $14.00 $14.02
I Revenue from Previous Years' Increases --0-.4-2---+---0-.8-5--+--1-.3-0--+---1.-7-6-
~setting Revenues 0.41 0.35 0.36 0.37 0.37
Operating Revenues I $14.16 $14.64 $15.18 $15.67 $16.15
Less Operating Expenditures J (13.9~
--
(17.58) (14.36) (13.52) (13.89) -
Cash Flow Surplus/(Deficit) $(3.41) $0.68 $0.82 $2.15 $2.27
Rate Revenue Increase I 3.00% 3.00% I 3.00% 3.00% 3.00% -
Post-Rate Increase
Revenue from Increase I $0.41 $0.43 I $0.44 $0.46 $0.47 -
(Less): Rate Increase Delay (0.24) (0.25) (0.26) (0.27) (0.28) -l I I I I --
Cash Flow Surplus/(Deficit) $(3.24) $0.86 $1.00 I $2.34 $2.46
Operating Fund Reserve I
Beginning Operating Fund Balance $7.71 I $4.47 $4.45 $4.58 $4.21 ---'
Cash Flow $(3.24) $0.86 $1.00 I $2.34 $2.46
Transfer to Capital I . I (0.87) I (0.87) (2.71) (2.35) --ENDING OPERATING FUND BALANCE 1 $4.47 $4.45 $4.58 $4.21 $4.33
Percent of Operations I 41% I 40% I 40% 40% 40%
• Line or column totals may not tie due to rounding
Total operating expenses included in the cash flow sufficiency test include depreciation. The City
currently transfers an amount equal to annual depreciation as well as an additional capital funding
transfer from the operating reserves to the capital reserves each year. Over time, the City has b~en very
proactive in annually contributing to the replacement of its system. Based on the current fund balances,
the City can mitigate the necessary rate adjustments by reducing its annual capital funding transfers to
the capital fund over the next five years. This will allow the City to meet the operating reserve policy
target of 40 percent of operations costs.
The proposed rate revenue increases for FY 2019/20 will be implemented by a full cost of service
adjustment, and rate adjustments will vary by customer class. For 2020/21, the percentage rate revenue
increase is recommended to be applied to the FY 2019/20 cost of service-based rates.
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4 -Cost of Service Analysis
The purpose of a cost-of-service (COS) analysis is to provide a rational basis for distributing the full costs
of wastewater service to each customer in proportion to the demands they place on the system. The COS
analysis yields an appropriate method for allocating costs, which could be continued until substantial
changes in cost drivers or customer flow or loading patterns occur.
Using a COS analysis, user rates are developed to allocate O&M, debt service, and rehabilitation and
replacement costs to system users. Allocating costs begins by developing unit costs for each billable
constituent: customer, flow, BOD, and TSS. Unit costs are then applied to the flow and loading of each
customer category in order to allocate the costs to each customer. The City's current rate structure was
developed using a COS analysis. The overall procedure used to develop the user rates is as follows:
• Revenue Needs. Define t he annual revenue that must be recovered from user rates and permit
users.
• Functional Allocation. Determine the percentage allocation of O&M and capital costs to the
billable constituents: pumping, flow, BOD, and TSS.
• Unit Costs. Develop unit costs for each billable constituent by dividing the total cost allocated to
that constituent by the total wastewater flow or loadings of that constituent.
• Customer Category Rates. Assign costs to customer categories based on usage, then develop
rates for each customer category.
4.1 Revenue Needs
The revenue needs are defined as the amount of revenues that must be recovered through user rates and
industrial user rates in order to cover annual expenditures less any offsetting revenues. Expenditures and
offsetting reve nues for FY 2019/20 are shown in Table 9 below.
Table 9 · Expenditures and Offsetting Revenues
Ongoing Operating Expenses
$10,803,213
Other Operating Expenses
Re lacement Fundin (De reciation Fundin 3,800,000
Transfers to Capital Fund 2,975,000
Adjustment for Mid-Year Increase 240,749
LESS: Offsetting Revenues
Additions to (Use of) Reserves (3,241,279)
Fines and Forfeitures (87,800)
& Investments (161,870)
(83,400)
Other Revenues (74,800)
Connection Fees
RATE REVENUES REQUIRED $14,169,813
* Line or column totals may not tie due to rounding
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In FY 2019/20, $14.2 million must be recovered through wastewater service charges to cover the City's
annual expenditures.
4.2 Functional Allocation
The American Water Works Association (AWWA) defines a two-step process for recovering costs. First,
capital and O&M costs should be allocated to applicable functional categories. A functional category is a
primary function of the utility that costs can be allocated to, then recovered based on how customers
utilize the system. For this study, fourfunctional categories were assumed as follows:
• Flow costs are associated with the collection, pumping and treatment of sewage effluent, based
on volume regardless of strength. The City does not meter sewage discharges. Instead, flows by
each customer class are estimated using water consumption. The flow component is measured
in assumer flow in hundred cubic feet (ccf).
• BOD costs are associated with providing the transportation and treatment of dissolved
organisms within sewage effluent. BOD costs are allocated based on assumed BOD strength in a
user class' discharges. BOD is measured in pound.
• TSS costs relate to providing the transportation and treatment of solid objects within sewage
effluent. TSS costs are allocated based on assumed TSS strength in a user class' discharges. TBB
is measured in pound.
Once the functional categories have been defined, each operating and capital cost is allocated on a line
item basis to one or more of these functional categories. The functional costs are then allocated to
customer classes based on the unique demands each customer class places on the system.
The allocation metrics shown above are consistent with industry standards. Items that cannot be
reasonably allocated between these functional categories are allocated "As-All-Others" and costs are
split proportionally based on the allocation split of all other items. ·
Annual expenditures and off-setting non-rate revenues are allocated on a line-by-line item basis between
the functional components outlined above.
As noted, a total of $14.2 million must be collected through rates in FY 2019/20. Functional costs are
allocated as one of t he following: customer only, flow only, flow/BOD/TSS, as-all-others, or any other
metric deemed pragmatic. Costs allocated to each category can then be divided by the total of number
of units served by that category based on the metrics outlined in Table 10.
Table 10 Unit Cost Calculation
$ Allocable (in 1,000's) $7,057,775 $4,542,406 $2,569,632
% allocable 58.63% 25.85% 15.52%
TOTAL UNITS 3,736,824 ccf 5,454,181 lbs 5,138,340 lbs
UNIT COST $1.89/ccf $0.83/lbs $0.50/lbs
* Line or column totals may not tie due to rounding
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CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Figure 1 Wastewater Functional Allocation
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5 -Rate Design .Analysis
5.1 Customer Allocation
The City does not individually meter wastewater usage by its customers. Metering wastewater is an
expensive and generally inefficient process. Single family residential customers, including duplex and
'Ml' customers, incur a flat monthly charge for service. Schools are charged on a per student basis, and
all other customer classes are charged based on a percentage of water consumption, which is outlined in
this report.
For the purposes of this study, City staff provided wastewater billing records, including FY 2015/16 to FY
2017/18. FY 2017/18 data were utilized to develop usage information by !=UStomer class and by month.
Wastewater billing records list monthly charges by customer as well as the amount of water used by each
customer. Water consumption was not provided for those customers who receive a flat monthly bill (i.e.,
single family residences and schools). For these customers, data from the water utility billing system was
used to estimate discharges to the sewer system. In order to test the validity of the customer data, two
tests were performed: an accuracy test and a reliability test.
The accuracy test verifies that the correct data is being used by performing a price out on the provided
data set in order to calculate revenues and compare the result to the actual revenues listed in financial
statements. An acceptable margin of error for this test is +/-3 percent (actual revenues compared to
revenues calculated from the billing records). Based on the Comprehensive Annual Financial Report, the
actual wastewater rate revenues collected by the City in FY 2017/18 amounted to $13.9 M. Using the
customer data set provided, the calculated amount came to $13.8M, a difference of $0.lM. This minimal
level of discrepancy validates that the data provided is sufficiently accurate to be used in the model and
calculations.
Performing a reliability test is also necessary in order to confirm that the correct data is being used. From
a statistical standpoint, the definition of reliability is the consistency of a set of measurements. In other
words, "Can the provided data be considered a 'normal' year?" It is important to verify that a normalized
year of data is being used as the foundation for developing rates; otherwise, revenues may be over or
under collected. For example, during a wet year, consumption may be reduced. If a test for reliability is
not performed under these circumstances, then the customer base may be understated. Rates would
then be set at a level higher than needed and revenues would be over collected. While there is no
guarantee that a 'normal' year will occur in the years addressed by this study, for the sake of projections,
it is prudent to assume that this will be the case.
In performing the reliability test, historical data was reviewed and compared. When comparing historical
data, it is important to account for any growth within the customer data and also to take into
consideration any external forces (such as weather, conservation, etc.). Based on the data provided the
average winter water consumption has gradually increased since FY 2015/16. Starting in 2017, the state
finally started recovering from the extreme drought, which started in 2011. The state is now drought free
for the first time since 2011. Consequently, the water consumption has been presumably increased.
FINAL I OCTOBER 2019 I 17
Nov. 19, 2019 Item #16 Page 35 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
After the provided customer data sets were validated, the number of accounts, the amount of flow, BOD,
and TSS for each customer class were determined. This allowed for the allocation of costs from the
various functional categories (as described in the previous section) to each customer class. The customer
classes are defined as follows:
• Single Family Residential includes single fam ily residences, duplexes and Ml (multiple PD Us)
accounts. These users are charged a flat monthly wastewater bill.
• Multi-Family Residential includes multi-family residences and mobile homes. These users are
charged based on 90 percent of their water usage (per ccf).
• Group II Commercial includes soft water services, car washes, office buildings, professional
buildings, laundromats, department and retail stores, warehouses, hospital convalescent homes
and indoor theaters. These users are charged based on 95 percent of their water usage (per ccf).
• Group Ill Commercial includes hotels and motels without restaurants, repair and service
stations, shopping centers, amusement parks, nightclubs, nurseries and greenhouses,
commercial laundries, manufacturing and lumber yards. These users are charged based on 95%
of their water usage (per ccf).
• Group IV Commercial includes hotels and motels with restaurants, wholesale bakeries,
supermarkets, mortuaries, and restaurants. These users are charged based on 95% of their water
usage (per ccf).
• Group V includes schools:
Elementary Schools are billed on a per student basis.
Middle Schools are billed on a per student basis.
High Schools are billed on a per student basis.
Boarding Schools are billed on a per student basis.
• Group VI Large Volume includes organizations and social services. These users are charged
based on 95 percent of their water usage (per ccf). Currently, there is no accounts under this
class.
• Breweries include all businesses where beer or beverage brewing takes place. As a component
of the Study, the City will be adding several new brewery specific rate classes to account for the
unique wastewater discharges that breweries generate. The brewery proposed classes are:
Bl-Brewery without a restaurant and hauls waste for outside treatment. These users are
charged based on 82.5 percent of their water usage (per ccf).
B2 -Brewery without a restaurant that does not haul waste for outside treatment. These
users are charged based on 82.5 percent of their water usage (per ccf).
B3 -Brewery with a restaurant and hauls waste for outside treatment. These users are
charged based on 82.5 percent of their water usage (per ccf).
B4-Brewery with a restaurant and hauls waste for outside treatment. These users are
charged based on 82.5 percent their water usage (per ccf).
• Industrial Pretreatment Class Ill includes any user discharging waste other than domestic
waste, having a reasonable potential to adversely affect the Encina Water Pollution Control
Facility and requires annyal inspection and permits every three years. These users are charged
based on 95 percent of their water usage.
S.1.1 Customer Class Loading and Jlllocation
Carlsbad provided a table that outlines the assumed loading concentrations by user class. It is assumed
that these concentrations are accurate. No changes have been made to the assumed loading
concentrations that are shown in Table 11.
18 I OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 36 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
Table 11 Loading Assumption by Class
GROUP 1-SFR 200 200
GROUP I -MRF/MOBILE HOME 200 200
GROUP II -Commercial 2 130 121
GROUP Ill -Commercial 3 328 279
GROUP IV -Commercial 4 820 680
GROUP V SCHOOLS
Elementary School 130 100 10 gpd per
student
Middle School 130 100 15 gpd per
student
High School 130 100 20 gpd per
student
Boarding School 130 100 75 gpd per
student
GROUP VI -Large Volume (no accounts) 130 93
Breweries
Bl-Brewery without a restaurant and hauls waste 130 121 for outside treatment
B2 -Brewery without a restaurant that does not 1,265 810 haul waste for outside treatment
B3-Brewery with a restaurant and hauls waste for 820 680 outside treatment
84-Brewery with a restaurant that does not haul 1,610 1,090 waste for outside treatment
Industrial Pretreatment Class Ill
Hughes 41 52
Beckman Micro Oper 1 2,082 601
Culligan 5 51
-Using these assumptions, water consumption data, and the wastewater billing records, assumed usage
by each customer class was calculated and is summarized in Table 12.
Table 12 Billed Usage by Customer Class for FY 2019/20
,. -·~-;"~ Flo~v' - -BOD -TSS
, , -Mo_nthly Account (1,000 ccf) (1,000 lb) (1,000 lb)·
-~~--., .. ..,.,~'..'.t' ..... ...-)-.· ~~
GROUP I-SFR 21,644 2,095 2,616 2,616
GROUP I -MRF/MOBILE HOME 1,035 537 670 670
GROUP II -Commercial 2 1,120 427.85 348.06 320.10
GROUP Ill -Commercial 3 292 460.39 943.60 801.50
GROUP IV -Commercial 4 119 161.63 827.35 686.09
GROUP V -Elementary Schools 19 16.21 13.16 10.12
FINAL I OCTOBER 2019 I 19
Nov. 19, 2019 Item #16 Page 37 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
:,· ' -- -Flo~ Boo· .. ·tss ~-
.;_:'.fto!Jthly Account (1,000 ccf) (l1Q._q9.J.b) (1,QOQ)~f _
GROUP V • Junior High Schools 4 9.57 7.77 5.97
GROUP V • High Schools 4 17.80 14.45 11.11
GROUP V · Boarding Schools 1 7.10 5.76 4.43
GROUP VI• Large Volume (no accounts) 0.00 0.00 0.00
Breweries n/a n/a n/a
Industrial Pretreatment Class Ill 1 4.47 8.30 13.27
TOTAL: 24,238 3,737 5,454 5,138
* Line or column totals may not tie due to rounding
Using these assumptions and the unit costs developed in the functional allocation section of this
wastewater report, costs were allocated to each customer class as outlined in Table 13. Because the City
was still in the process of assigning brewery users into the brewery classes at the time of the analysis, the
total billed usage was not calculated for the breweries. The proposed brewery rates are calculated based
on the assumed loading concentrations and return to sewer factor for each brewery subclass.
Table 13 Allocation of Wastewater System by Customer Class (FY 2019/20) ($ millions)
--Custoi:n~r Class Flow BOD· TSS
GROUP 1-SFR $3,957 $2,178 $1,308
GROUP I -MRF/MOBILEHOME $1,014 $558 $335
GROUP II · Commercial 2 $808 $290 $160
GROUP Ill -Commercial 3 $870 $786 $401
GROUP IV· Commercial 4 $305 $689 $343
GROUP V · Elementary Schools $30.6 $11.0 $5.1
GROUP V • Junior High Schools $18.1 $6.5 $3.0
GROUP V · High Schools $33.6 $12.0 $5.6
GROUP V • Boarding Schools $13.4 $4.8 $2.2
GROUP VI • Large Volume (no accounts) $0.0 $0.0 $0.0
Breweries n/a n/a n/a
Industrial Pretreatment Class Ill $8.4 $6.9 $6.6
TOTAL: 7,058 4,542 2,570
* Line or column totals may not t,e due to rounding
The amount of revenues recovered by each customer class is summarized in Figure 2.
20 I OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 38 of 158
Industrial
Pretreatment Class Ill
$21,983
GROUP V -Boarding
Schools
$20,413
GROUP V -High
Schools
$51,217
$27,531
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
Commercial 4
$1,337,425
Figure 2 Cost Allocation by Customer Class
5.2 Rate Design
This task involved three separate activities -1) allocating costs by function (see the functional allocation
section), 2) allocating costs by customer class (see the customer allocation section), and 3) calculating
wastewater rates. Based on the rate evaluation performed under the previous tasks, it was determined
that in general, the City's current rate structure is capable of meeting the City's goals. The recommended
rates are based on "cost-of-service" principles that incorporate the work performed in previous tasks and
adhere to Proposition 218 requirements.
Once costs have been allocated to customer classes, rates can be developed. As noted, the single family
residential customer class is charged a flat monthly rate, schools are billed based on number of students,
and all other customers are charged based on a percentage of water consumed.
To calculate the single family residential (SFR) flat monthly charge, total cost allocable to the SRF
customer class is divided by the total number of bills that go out to this customer class per year. In order
to calculate the charge per student for each school type, the total costs allocable to each school type are
divided by the product of the number of months the school type is assumed to be in session and the
number students served by that school type.
Charges are developed for all other customer classes by dividing total costs allocable to that customer
class by the total assumed flow of that customer class. These customers are subject to a monthly
minimum charge for wastewater service. This minimum monthly charge is set at half of the monthly rate
that is incurred by SFR users. This minimum charge was accounted for when developing rates. Table 14
below outlines the resulting wastewater rates by customer class for the next five years.
FINAL I OCTOBER 2019 I 21
Nov. 19, 2019 Item #16 Page 39 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Table 14 Wastewater Rate by Customer Class
GROUP I
Single Family Residential (flat)
SFR w/ Second dwelling unit (flat)
Multi-Family Residential (per ccf)
MRF/Mobile Home (perccf)
GROUP II -Commercial 2 (per ccf)
GROUP Ill• Commercial 3 (per ccf)
GROUP IV• Commercial 4 (per ccf)
GROUPV
Elementary School (per student)
Junior High School (per student)
High School (per student)
Boarding School (per student)
GROUP VI • Large Volume (no accounts)
Breweries
Bl -Brewery without a restaurant and hauls waste for outside
treatment
B2-Brewery without a restaurant that does not haul waste for
outside treatment
B3 -Brewery with a restaurant and hauls waste for outside
treat_ment
B4 -Brewery with a restaurant that does not haul waste for
outside treatment
Industrial Pretreatment Class Ill
22 I OCTOBER 2019 I FINAL
$28.66 $29.52
$42.99 $44.28
$3.38 $3.48
$3.38 $3.48
$2.80 $2.88
$4.25 $4.38
$7.87 $8.10
$0.57 $0.59
$0.85 $0.87
$1.14 $1.17
$5.91 $6.09
$2.80 $2.88
$9.07 $9.34
$7.87 $8.10
$11.26 $11.60
$4.68 $4.82
Nov. 19, 2019 Item #16 Page 40 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
6 -Rate Comparison
Carollo conducted a survey of wastewater rates to compare the City,'s existing and proposed rates to
those of surrounding agencies. All wastewater systems face unique challenges, and they develop their
rates accordingly. Taking this into consideration, Figure 3 below summarizes regional monthly
wastewater bills for single family residential customers, including the City's current and proposed
monthly flat rates. As shown in the figure, the City's rate is the lowest amongst surveyed agencies. With
the proposed increases, the rate remains one of the lowest in surrounding area. Additionally, this survey
might not reflect rate increases currently under review, but not yet implemented.
$140
$120
=$100 m
~ $80 .s:: +" C ~ $60
Figure 3
-Fixed Charge Commodity Charge
Regional Monthly Single-Family Residential Rate Comparison
FINAL I OCTOBER 2019 I 23
Nov. 19, 2019 Item #16 Page 41 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Appendix A
PROJECTED O&M COSTS
E:SCAU.10R I"/ JOHH2O FY 2020121 FY 2021122 FY 2022,121 FY 2013/24
REVENUES
Chars es for s.r"kes
code line ltl!,m
5100 Commodity Usagl!!
511.2 5ewcrPre--Tre.at
5121 Sewer literals
other Char4ts for Scrrvic6
Finu •nd ForfeiturM
Late Charses
Othl!r Fines ;and forf•ltures
ln¢:om• frQm Propcrt:Y & lovfftment,
5300 lntc:rcit lt'tCQmo • Pooled Clsh
S>OS
5310
S,60
5361
lntcrest-UnrulldGaln5/Loucs
Interest lncornefrmOthr Inv
Sale of Clpjtill As.sets (c.1csh adJ)
DoNtc:d Anc:ts
Othc-r Income from Ptoperty &ln~tments
Tot.II Income from Ptoparty & tnwtstments
Interdepartmental
5430 t"t'c Labor
Other rnte,de-partrnen~I
Total lntetdepartmental
other Revenues
SSSO Prior Year fee Refur,ds.
5639 ....
5674
Misc R~mbtJr,ement El(fl,
MISC AR Write Offs
Other Other Re\l'f!n~
Total Other Revenuu
TOTAL REVENUES
EXPENDITURES
,.,rsonnl'I
tcdo linett.m
6100 R~Salaries
6101 lncentivf!P.ay-
6150 100 Worlcer's Ca.mp
62()0 Overtln»Salarles
6210 Standby Pay
6300 Parttlmes Salaries
6400 Temporary~p
6501 HHlth lnsur~nce
6510 Ufe lnwranc:e
6520 Vlsionlnsurilnce
6530 Medicire
6629 Cell Phone Refmbuf'sement
6630 Auto AHa.wance
6640 hrn~ Leave Accrual
66'1 Health'f£mpAwarcfs
66'3 ,1nal Vacatfon Pay ..,. fll'lillSlclc.Le.ave P.11y
66SS Ob.ability .... Unemplo~nt
6657 Worker's CompenUillon
6720 PERS
6723 PERS Unfunded LI.ab Up
6721 PERS (GAS8 53 CONTRA ACCOUNT}
6m Oper11tion Expense
6730 Soehl Security
6740 Oeferred Comp
Other PffsoMel
Total Pu ,onn.a Costs
OCTOBER 2019 I FINAL
ProjKtfon
Custor,'11'!:t De,ITW\d Growth 13,72a,.DOO
CUstomer Of.JMnd Growth ,.~"'
CUstorne:r ~.and Growth
Geiv~I lnfl•tlon
13,7S7,100
f--"'=ncc•""'='°""'=cc""=--=G<owt=cch_--11 S Cuitome:r~mandQowth .
87,800
lnterut Eamlnp: 161.870
Gffle~l lnfl1tJon
Ge.nerallnflltion
~llnfh1tlon
~llnft1tlon
~r11llntlltlon
1Gl,870
GffitBI lnflltJon a,,400
GmutJ lnffltfon
83,400
General lnftaUon
74,800
Gtn«rtlln~Oon
74,800
14.164,970
ProjeGtion
L.aborlnfladon l~S36,S13
labor Inflation
LAbor1nfl1don
Labor lnflatlon oo,na
Labor lnfl1tlon 25,552
Labor Inflation
LAbor 1nf11tk>n 20,000
L.abor 4 Health lmunnc.e 314,544
~llnflatfon 1,581
Gene-r.11nflatlon
Genefill Inflation l3,!H9
Ge:neAol Inflation ""' Ge:nen.l 1nn1t1on 2,100
Lilbcrlnfladon
Ge.netal lnftatlon
Lllbcrlnflltion
Labor Inflation 8.l.53
Genl!r:lllnftation 14,837
GM.tnl lnflltlon 4,107
Gener.al !nff.atlo.n 39,690
Labor· P£RS (Norm1I Cost) lJI0,681
litbor • PE.RS (NonMI Cost) 1.99,S27
Labor· KRS (Normal Cost)
Genenil lnfl.adon
GenetiillnflilllOn
Generill lnfl.aHon
Gener11I 1nf11;don
2,442,:385
ProjMbOn ProJeeilon Project-on Pro)t(tiOn
14,264,890 l4,7a7,950 15,265,790 15,751;310
,0,240 31,350 32:,360 33,390
14,2:95,130 14,8151,300 15,198,150 15,784,700
88,580 89,150 S s~.aso s 89,510
...... 89,150 89,3SO 89,510
98,270 102~30 109,920 1(15,320
98,270 102.430 109,920 105,11:20
8S,4'SIO 87,630 89,820 "2,070
85,490 37,630 89,820 92,070
s
761'70 78,590 80,SSO 82,560
76,670 78,590 80,550 B2,560
14,644,140 lS,1.77,100 15,667,790 s 16,154,160
Projedion Proj!ction Pr.ojectlon Pro)ectioft
1,582,610 1,630,090 1,678,990 1,729,360
OZ600 64,480 66.410 68,400
26,320 27,110 27.920 28,760
20,600 :21,220 21,860 22,520
337,760 361,840 386,730 412,370
1,620 ,...., 1,700 1,740
24,540 25,150 25,780 26,420
390 400 410 420
2,150 2,200 2,260 2,320
3,400 8.6SO 8,910 9,18!:I
lS,210 lS,590 15,980 16,3&'.)
4,210 4,320 4,4:,0 4,>40
40,6BC 4!,700 42,740 43,810
108,905 215,172 221,627 221.276
227,.263 255,109 277,705 288,111
2,563,257 2.674,6511 2,783,452 2,882,&07
Nov. 19, 2019 Item #16 Page 42 of 158
MP)t•n•n~ & Equlpir,cnt
7111 Other Mieh & Eqtlip
711S Velide R.nt~lf
71~ W.iSt:R~tals
7120 flAiKLHS41S
nio omee Eq.iip Maint
n11 Comml#'l!Qtlanfqulp MalnU•N~
7215 Sohwue M.tititenUiee
n .16 Ccm~r MfT~fflllM:41
mo V~le M11ntenancc
7221 W11ihindWut
m2 Othtr Equip MilN
m, PlpelN ~ntffllrKit
mo Rout!M 8Ulldln& MaintenatKe
n41 As))MII bpaks
n" Miit\tenarc., Rep1ir• rd Reh1b
7400 .....
7410 legil
7435 Admlnlrtr;)tJw
7490 ~ f',ofHSioMI SMlfc<M
7500 EncfMServbs
7500 El'ltiria ~ tPe~('>ft,ayet1)
7550 Mis,cebn.ous Ovtslc» Sarvfie»s
7551 Bal'lk.Sl!'.tvit',$
7553 Convn Am Support
7554 R ... tory/Pfflflittl"I Feel
7556 MlscS.Nie.@S
7558 L1undtyand Uniform MalntHl"ICe
7SS9 El1KttlnJ/SCA0AServbs
75'2 FOG lnsptttion Sff,,ice.s:
7563 Smutco-m WI R/Al•rm Serv6c.e-s
7564 Landsc1pi'figSffvic.H
7710 Msandl>\lbl!shinc
7711 Ol.11$ 11nd Sl.,b5aipJons
77ll 8oak:s and P\lbrie.uions
7713 Audio Vl,1111 Mltffllb
7715 Printitlg
mo Postage
7725 OfficeS(Jp~iH
m• Office Ft.lrnlture &Elf,lipment mo Cotnputet Softwue m, Mb,;, Compi.Aff Ke~6mire
7135 Ptcrno Mater1a1,
7745 FoodEX4)erM
7750 Keatan:tUgM.
7751 T•lephont-& Commt.nlcatlons
7752 Waste Dlspo,lil Se.Mots
7753 Water
7801 Buildil"l&Mail'ltenanc:e
7810 ElectrfulSuppUe:s
7&11 Janito~I Supplies
7820 Paru-VeHdn
7821 P■rts•Equip
7830 Rod<andMlne:ral Producls
7831 A~lt
7850 SrniillTook
7SS1 ~f¢1YEQ1,iprr,cn1
7852 Uniforms and.AttlUSOl'ie:s
7853 Moters/HttJrcs,
7857 Pe:rso~J Protective Eql,f.ptne:nt:
7880 GasolrrMtaild~I
7883 Chemicals
78 .. Tralnln&SwPlies
78 .. Medk:Ji1 ~IH-Dlspos1ble
7899 MIK~fes
8110 Employee Trairling
8120 T'ult!Offltmibl.n«ne:nt
mo Ttainirc/Tniili,c.itel5tt<ITtnel
8500 D@?fecl1tlon
8520 Confete«e Tralld
8522 MIK. Me:11b/Mlles
85,0 Bad Oebtf.xp-Other Inv/Bits
8534 RqOve:r/Short
""' NED Rctntal Aulst:.nce P.'lyment; ..... bterill Aul,tance i'roa,am
'610 S11tdcmenls
8700 Co-
8809 Vclicle Direct Chartt;s
8810 Velicle:Main1Manot(2}
8811 vci.;lc Rtpl..:emcnt
WO Ge:nerallilb
"""' lnformatfon Tedvloqit:s .. ,., Misc IMe:tde:pHtmental Oiirge:1 .... t&ChJ8ad:
8892 Utnity&atrg Chilr~tt
8510 f"UQl/lce,,C fffi
8511 Arbltr.lge CO$ts
8520 Printjp,11
8"21 lnterest~e
8922 Int E'xp-Capltatfzed hw.erest
Othff•HNt&Ught
Other-Puts & Equipment
Othct-YINrtCcwers
Addt'I Milnre,w,ce: & Equipment
Other M,inlenano & Er;iuipl1'eflt
Tot.I Mtinh:n•nce & Equipment Costs
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
JiiiiA #E·RW·~all+M&Nlii!·HlifMNiii·P:if'NFiF.PiiHM
Genera! tt\rlatiOn
G.nenill.nfli,t1on l)>lO -',030
Gat'Nt.11111nf\ation 1,000 1.030
Ge~tnflatlon
~"IH't11nfl•tion 500 510
G.n«al tnflatfon 1,000 -',030
Gent-1Wlnflatfon 74,250 7i,l10
G~lnfi.tlon
~.nen11rrnat10n 500 510
Gen.RI Inflation 2,500 2,$0
~llrtt'latiofl
~lnfl&tlcin 141,000 144,S30
Gt!'l'Wt'lllnflttfon
~allnflatie>n 10,000 10,250
~!hrl\ttlon 3,000 '·°"' ~lnflatkln
~lnflatlol\
Gentnl Inflation
Gene1'allnftatlCln 130,000 133,250
Gmlnfltn•Cstmr OmfdG,wth 4,101,.976 4,240,SCO
No AMual l1'CIW.S. 9Sl,50S 9SS,Sl0
Gffltnl ln:flatlon 170,000 1?'4.2SO
GtfJWallnflttion
Genenll~tlon
General Inflation 32.000 mm
GMlralirtnulon
~llnflltlon 5,000 S,130
~llnfiltlon 20.000 20,500
GtMJ-11 Jnfletlon '6,000 47,150
Ge:Mnl lnR1tJon &S,000 87,.130
~flnRatlon. 65,000 ..... o
Genenllnflltlon 2,000 2J)60
~tlrtflatk:in 11,000 11,280
~llntbt'lon 500 '10
G.Nr»l lnfllt.lan
~lnRIIISon 7,500 1,"30
Gmenl lnftlt.lon ,,soo 3,590
Gtnetal lnfbtion 5,000 S,130
~llnflldon 2,000 2J)60
Gtne~t lnflltion 1'),00:, 10,250
GeMr»l lnfaadon ,,ooo 3,l)80
Gen.tat lnRadon 2.000 2.0SO
~llnf'liUon
Utlll\itslntlation 285,(0;) 292,.130
Ut.llltiH lnfladcin n,ow 23,580
U~ftittlnllltion IS.OW 15.380
Utlldulnffatlon ,..000 3Ei,900
General lnfadon
Genenil lnlratbn 2,000 2,050
~11n'4tion ,00 '10
General tnflatSon 5,000 •~,o
G4-nc"'11"'1.ttion 106,000 108,650
Gel'leral tn'1ittJOn 1,000 1,D3()
~lfnl~tfon 277 280
Gener.I rnRil~n 2,500 2,5<0
Gfflffalfnfr..Gon 18,000 18,450
~rl'rflltbn 3,000 3,000
G•~lnflatSon
GeMral lnf~tion
UtlltJe:slnflation 2.000 '·°"' ~e11, l~1tion 60,000 61,500
~ lnft.tJon
G•ner1111'1flati04\
G~lntlltlon 20,000 20,500
Gil'Mttllnflatbn 500 SlO
Ge-l"ll'falltTf1a~n
Gentnltnflltion 3,000 3,000
Constna:.don lnflatbn 3,80),al) 3,895,000
~nenl1nftttlon 2S.000 25-,630
Gene:nlllrlladon S,000 S,130
Gentt-allnfJatlon
Genffallnflltlon 16.000 1•,400
No Annual lncrusc
,No.AMul.llnicruse S0.000 S0,000
GtNf'allnJiltlon
NoAMUA.llncrHse 440,000 4'0,000
GffleRllnflatlon 71,300 7',l)80
Gener at Inflation 80,400 82,410
G&iDenlllnfbtkm 217,766 223,llO
GMtritl lnllldon ...... 56,210
~llnflatlon 187,104 191,780
General Inflation 7•1,lJ0 759,640
~llnflation
GMeniil lnHadon
GeMl'ill lnllatic>n
GerW!1111llrdlltk>n
Gfflil1"11l ll'lft.tlon
Geneltlllnflltion
0ne rl!M·fxpe,tse
HCI AnnlAI lnct'HSe
No Aln.ll1 lnctHse
HoA.rn.JillrKTHR
Genima lrdlatbn
(C..k::lA,tedBelow) (1,.050,726)
12,160,!21 $ 11.,404,404
1,<)60
1,060
520
1,<)60
78,010
520
2,620
143,.lAO
10,5,10
.3,160
1,..,..,
4.374,270
9S3,Sl0
173,610
3.3,620
5,260
21,010
43,3,0
89,310
'8,300
2,100
11.560
520
7..,.,
3,680
5,260
2,100
10,SlO
3,160
2,100
299,430
24,170
15,760
37,820
2,100
320
5,260
111.370
1,060
290
2,620
18,910
3,160
2,100
63,040
21.010
520
3,160
3,992,380
26,270 ..,.,,
16,810
50,000
440,000
74,910
84,470
228,790
~,620
196,S70
778pl0
(1,08~'41)
U.636,199
$ •. s
1,090 1~20
1,090 1,120
530 540
1,090 1.,120
79,'l<O .81,960
530 540
2,6,0 2,760
151,840 lSS,640
io,no 11,0,0
5,240 '·""'
1-39,990 143,490
4,.C.93,450 4,613,660
(M<,7211 (m,m)
183,080 187,680
.... 60 !5.320
S,!90 5,520
21,540 22P80
49,540 50,71!()
91,540 93,830
70.010 71,760
2,150 2,200
U,850 12,150
'30 540
ll.coo 8,280
!,no '·"'° 5.390 S,520
2,150 2,200
10,770 11!)40
3,240 3,3,!0
2,150 2,200
300,920 ll4,5SO
24,770 25,3'90
16.].S0 16,550
'8,770 39,740
2,1SO 2,200
330 340
5,390 S,S20
ll,USO 117,000
-',090 1,120
300 310
2,600 2,760
19,380 19,860
.J,240 3,320
2,150 2,200
64,620 66,240
21,540 22,l)80
S>O 540
3,240 3,320
4,092.190 4,1.94,490
26,930 27/,00
5,3'0 5.520
17,230 17µo
S0,000 S0.000
440,000 440,000
76,7tJIJ 7S,700
8&,580 88,7.0
234,SlO 240,370
59,050 60~4()
201,480 206,520
198,100 818.0SO
(1)03,580) (1,125,651)
10,731,20 $ U.006,au
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 43 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
C•pftalOUtt&V
900S Cai;ilt.tl Out!ay < S 10k -New
9006 Capft.,I Outlay< $10k-Repl
9010 Cap Outlay-Vehk:l~s
9020 Computer Equip> $10k • Repl
9021 Office Equfpnent
9022 Other Eqtdpme;nt
9030 Offke fumiMe
9050 Capitaezed Assets
Other t.apltal Outlay
TotalCapbl OtJUay Co:rts
Other Flnandnr Uws .... TransfenOut
Tt11NfcrOvt-Debt Service
Toh I Other Fina ncfnc Usff Costs
TOTA.L ExPENDITUR:ES
· I
ESCAI.ATOI? FY 2019/20 FY 2020/21 FY 20:21/21 FY 2022123 n 2023/'24
Gffle.nllnflatlon
General l~tlon
Gc~ral lnfl.tlon
Ge:ntnl Inflation
~allnflAdon
~t1lltifl•don
Gencnl Inflation
Gen!nl lnfl.aUon
~Mtallnfladon
Constl'\letlon lnflatiOn 2,9"75,000 3,049,37.S 3,125,609 3,203,750 3,283,843
Gmir~ lnfladon
2,975,000 3,049,375 3,12.S,609 3,203,750 3,283,843
17,578,2l.3 17,017,036 17,486,499 16,724,470 17,172,763
.AOOrTIONAl. O!M £:C.F'&l!MUP:ES FY l019t20 ;y 2020/21 FY 2021/22 FY 2022/23 FY 202.3/24
m,woi,•<10,s,1,.., ... ,. ""'
Addt'IO&M 2
One-tim@ (EWA ~pi■ costs I
Ont-lim~ (OptJmi'lation, etc, I
less; Added RCVC!nuc
l6S: Bud&et Analysis Amounl
AddedO&M
OCTOBER 2019 I FINAL
bbor lnfl1Uon
Gene~I lnflitlon
One lime Expe~
One lime E.llPCnse
Gene~llnflatlon
One. llml! Exp,:nse
Gene-rtl ln"•tiOn
-s
{l,039,9i8)' (1,060,726) r-(l,081,941)' u.103,sso)' jl,12S,651)
11.oa•.•201 s 11,0<0,nGJ s 11,oat,9411 $ (1,10,,saoJ s 11,us,6S1J
Nov. 19, 2019 Item #16 Page 44 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
Appendix B
CAPITAL IMPROVEMENT PLAN
SEWER ?.EPU.C£1.1&ST l'!IDJ[-CTS FY1019/l0 fV 2020/21 fY 2021/ll FY '1D.2Z/2J FY 2023/24
Include Pttiojttt:Tltllt FundEns:Sour«: Total Budget
Agua Htclonda Llft.SUtion Biologiul Moniloring And Mainteruince 225,000 l>,000 2S,000 25,000 2S,000
Bw:na lnter«pto, Sew,er Access Ro::.d Improvement$ 1,150,000
Buc:N lntCl'«ptOf Sewer Improvements 3,7S8,499 226.SOO 2,170,000
ButlM lnterc,eptor ~Wtt Reafienmcnt • h st Segment 1,987,000 ~480,000
Chs,qwpin Lift S~tion For« Main Outfal RNtlj1lm«mt 320,000
Entin• CaJ;>iul Projec;ti: 128,754,044 5,290,7U 6,234)41 s.m,rm S,924,.$10 6,563,932
Foxes Landing lift St.ation WetW\l!I And P1n1p Rl!fll.acement 5,492,000
Loan• SewttReplTo SeWll!rCom 4,700,000
North Batlquitos lntBC:eptor Sewer Au:ess Road lrnpmv~nts 250,CXIO 250,000
Nonh 8allqultos Uh Suitlon fortemaln Rehabltltatlon SS0,000
Odor And Corrosion Prevention Assessment 3201000
Odon Center 3,9'5,000
Poinsettia Lane Lift Station Overflow 1,299,249 100,000
SCAOA 111'fFOYements 1,207,500 1.000.cm
Sewer lift Station Re:paln And Upgrades. 5,035,380 525,000 150,000 150,000 150.000 150,000
Sewer Line C.paiclty ln,pOYcmcnts 970,000 100.000 870,000
Sewer Linc COnditiQn ASffU~t 4~9'68,000 22S,000 225,000 225,000 225,000 225,000
Sewe.r Line Refurtilshments And Replacement 41,856,475 1,5.30,CXX> 1,530,(XXI l,&S0,000 l,SS0,000 1.S>0,000
Simsbury S~wer Extension 671,000
Terra mar 14TH Coastil Improvements S00,000 150,000
Tem,rnar ~r Replacement• El Athol And Los Robles 1,,250,000
Vallecltos lnten:eptorSl!wetCleanlngAndCCTV 250,000 250.000
VIiiage And 8arrlo Tr.iffk Clrdes 160,000
Villas Sewer Lift Station Replacement &So,000 130,000 no,ooo
Vist:11 Carbbid lntercept@r • Rehabli1,1tion (VCl & VC21 141,000 20,0CX> 121,cm
Wat@r, Recycled,. And Se'Wft' Muter Plan 447,680 2s,ooo 25,000
4,216,632 599,29; 2.960.301 4J2,390 99,747 23,664
TOTALSEW£R RE.PLACEMENT PROJECTS US,3'24,459 10,446,506 16,510,642 7,809,462 3,274,317 3,812,596
SE\VEP. CONtJECllOH rec P~OJECTS FY 2019/20 fY 2020/Zl FY ZOll/ZZ FY ZOll/13 FY '1;.0D/24
Include Project Titk FunctincSouree TotiilBudcet
Buena IMerteptot Sewer lmp,o...ements 550,000 S0,000
Faraday & £1 CamQ> Ru 1 Sewer Replacemi:.nt • Orion To PAR 11!16,000 46,DDD
Las Palmu Trunk Se'Nef 3,18£,.000 556,000 2.630.(XX)
lo.an Rep11y -Sewer CoMTO SewerR~~ 4,700,000
Sewer Model~ 2,400,000 300,000 300,000 300.000
Sewer Monitorq Pro&ram (capacity) 928,000 12S,Ol0 12S,DDD 22,000 22.DDD 22,000
~ C•rlsbad lntcn::cptOr • 6uem Vht~ lift St•tion lmpro·vements 1,125,000
Vi"sta Ci_rl$bad lntm:cptOr• Agua Ht?dionda ls&ForcetNln (VC12-VC13 30,367,000
Vista Carlsbad lnten:@ptor • lagoon Bllcfge R@plac@ment {VC1181 9,518,000
Vista CarlsbMI lnte,uptor • R@ach VC14 To VCl.S 20,745,000
Vista Carisb~ lnt@R:l!ptor • R@ach VO 2,689,000 591.000 2P92,000
TOTAL SEWER CONNECTION FEE PROJECTS 76,394,000 1,621,000 Z,801,000 322,000 2,114,000 322,000
S-'WtAAOP{J=Y lOJ9/2tl· FY2tla/24) UNESCA.\.ATEO ... 51,85J..S22 s SS,187,250 ... s 10,446,506 s 16.510,'42 S 7,809,462 S 9.114,.111 s 8,.e,12.$96 ........ 7,187/.:IXJ 1.S,85,301 .. ...... t,<>&OlO ?.&01.ooc:i ID.IX'> 2,114,000 322,l)OO
TOTAi.: 59,040,-SU 5 t:2,772,551 fot1l $ 12,074,506 s 19,111,642 s s.n:1.~2 s tO,!SS,!:111 $ 9,l.34,$$6
10-YEAR OP [FY '2019/'lD· FY 202:1/29) ESCALATED .,.,. 10-2,$39,9S'9 s 119,7<12,.180 ... ' ,.......,,. $ t7/J8,S,St.4 $ 8,365,681 $ 9,173,883 s 10,112,656 ........ 10,397,0::0 11,674,.153 Eli:l)lnSion ,..,.,IXJO ,,.,...,, 34-4,934 2.,343.830 369,502
TOTAL. 112,936,959 s 131,416,U) , .... s 12,014,SOC ' 19,9S7,S49 ' li,TI0,6l6 $ l1,Sl7,7l2 $ 10,482,158
JOTAl OP (fYlOH/20 • JY 2039/40) ... 153.US,l60 S 1'}6,270,383
(xp.1nslon 1.3,607,0CIJ 16,S30,42S
TOTAL: 1H,n2:",u;o $ n .2.,800,l!Oll
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 45 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Appendix C
REVENUE REQUIREMENT ANALYSIS
FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
CASH FLOW TESTS
REVENUES
Charges tor Services $ 13,757,100 $ 14,295,130 s 14,819,300 $ 15,298,150 $ 15,784,700
Fine.sand Forfeitures 87,800 88,580 89,150 89,350 89,510
Income from Property &Investments 161,870 98,270 102,430 109,920 105,320
Interdepartmental 83,400 85,490 87,630 89,820 92,070
Other Revenues 74,800 76,670 78,590 80,550 82,560
Connection Fees
Total Revenues 14,164,970 $ 14,644,140 s 15,177,100 $ 15,667,790 s 16,154,160
EXPENDITURES
Ongoing Operating Expenses
Personnel 2.44~,385 $ 2,563,257 2,674,691 $ 2,783,452 $ 2,882,607
Enclna Operations 4,101,976 4,240,800 4,374,270 4,493,450 4,613,660
Maintenance & Equipment 4,258,852 4,329,330 4,401,490 3,255,209 3,323,814
Capital Outlay
Other Financing Uses
Other Operating Expenses
One•tlme Funding (1,060,726) (1,081,941) (1,103,580) (1,125,651)
Rate Funded Capital
Debt Serv1ce
Total Operating Expenditures $ 10,803,213 $ 10,072,661 $ 10,368,510 $ 9,428,531 $ 9,694,429
Policy Expenditures
Replacement Funding 3,800,000 3,895,000 $ 3,992,380 s 4,092,190 4,194,490
Transfers to C.pltal Fund 2,975,000
Additions to Meet Minimum Fund Balances
Total Policy Expenditures $ 6,775,000 $ 3,895,000 3,992,380 $ 4,092,190 $ 4,194,490
POLICY OVERRIDES
Repla~ement Fund.Ing
Transfers to Capltal Fund
Additions to Meet Minimum Fund Balances(')
Total Expenditures $ 17,578,213 $ 13,967,661 $ 14,360,890 $ 13,520,721 $ 13,888,919
Includes transfer. 0of!S not indude depreciation
Cash Flow Surplus (Deficit) $ (3,413,243) $ 676,479 $ 816,210 $ 2,147,069 $ 2,26S,241
DEBT COVERAGE TEST
REVENUES
Operatil'€ Revenues $ 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 $ 16,154,160
Connection Fee Revenues AJlowed
Total REVENUES $ 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 s 16,154,160
EXPENDITURES
Personnel 2,442,385 $ 2,563,257 2,674,691 $ 2,783,452 $ 2,882,607
Maintenance & Equipment 4,258,852 4,329,330 4,401,490 3,255,209 3,323,814
Debt Service
On@•time Funding (1,060,726) (1,081,941) (1,103,580) (1,125,651)
Coverage
Total EXPENDITURES $ 6,701,237 $ 5,831,861 $ 5,994,240 $ 4,935,081 S,080,769
Bond Coverage Surplus (Deficit) $ 7,463,733 $ 8,812,279 9,182,860 $ 10,732,709 $ 11,073,391
OCTOBER 2019 I FINAL C ~,-11,..
Nov. 19, 2019 Item #16 Page 46 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
REVENUE REQUIREMENT FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Revenue Requirement $ (3,413,243) $ 676,479 $ 816,210 $ 2,147,069 $ 2,265,241
Cash Flow Driven Surplus Surplus Surplus Surplus
Month of implementation February February February Februa~ February
Calculated Increase (%) 59.55% 0.00% 0.00% 0.00% 0.00%
Calculated Single Family Rate($) $44.37 $28.66 $29.52 $30.41 $31.32
Override 3% 3% 3% 3% 3%
Resulting Single Family Rate($) $28.65 $29.52 $30.41 $31.33 $32.26
41% 40% 40% 40% 40%
Rate Increases
Rate Increase(%) 3.00% 3.00% 3.00% 3.00% 3.00%
Cumulative Rate Increase(%) 3.1% 6.1% 9.3% 12.7% 16.0%
SFRRate $28.66 $29.52 $30.41 $31.33 $32.26
CASHflOW
Revenues Before Rate Increase $ 14,164,970 $ 14,644,140 $ 15,177,100 $ 15,667,790 $ 16,154,160
Revenues From Rate Increase 412,713 428,854 444,579 458,945 473,541
less: Rate Increase Delay (240,749) (250,165) (259,338) (267,718) (276,232)
Less: Expenditures (17,578,213) (13,967,661) (14,360,890) (13,520,721) (13,888,919)
Annual Revenue Increase $ 171,964 $ 178,689 $ 185,241 $ 191,227 $ 197,309
Cash flow $ (3,241,279) $ 855,168 $ 1,001,451 $ 2,338,296 $ 2,462,549
Total Ending Balance s 33,180,290 $ 19,403,137 $ 16,908,968 $ 13,573,816 $ 11,691,330
1121 Days 703Doys 595Days 525Days 440Days
Operating Fund
Beginning Balance $ 7,708,047 $ 4,466,767 $ 4,453,355 $ 4,580,180 $ 4,212,844
Cash Flow (3,241,279) 855,168 1,001,451 2,338,296 2,462,549
Transfers from Operating to Capital fund (868,581) (874,626) (2,705,632) (2,347,361)
Ending Fund Balance $ 4,466,757 s 4,453,355 $ 4,580,180 $ 4,212,844 $ 4,328,032
Days of Operation 151 Days 146 Days 146Days 146Days 146 Days
41% 40% 40% 40% 40%
Coverage
Cove rage Factor No Debt No Debt No Debt No Debt No Debt
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 47 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Appendix D
FUNCTIONAL ALLOCATION
CURRENT YEAR, --
AUOO.TION l'~'OfX flOW BOD TSS A~ ,._11 O~hMo
flow/800/TSS 35" 42" "" "" so Ptttent customer "" "" "" 100"
Flow Only 100% °" "" °" As All Others "" "" "" 100!1
Plant In Sl!fVke 66% 21!1 13!1 °"
Pl.ANT IN SEP.VICf RCNLO now BOD TSS As Atl Otll!-rs
IM· IMPROVEMENTS
N -JOINTVl[NTUR[
lO-IAHD
ME· MACHINERY & EQUIPMENT
PP· PIPES & PUMPING
Plant•ln,.Senrke Sub Total
ReaUocation of •As AU Others"'
Total Allocatlon
Percentage AllocaUon
EXPENDITURES
Pe~nnel
Reg~l,aries
Incentive Pay
IODWork!!!r'sComp
Overtlme sala~
Standby Pay
Parttlmes S.iluie$
Temporary Help
Heatth Insurance
Life Insurance
V,:don lnsur.1 nee
Medicare
Cell Phone Reimbursement
Al.Ito Allowance
Earned Luve Accrual
HealthvEmpAwards
Fim11I Vati-tion Pav
Final Sick Leave Pay
DisabUity
Unemployment
Worker's Compensation
PERS
PERS Unfon~d LI.ab Exp
PER5 IGASB 68 CONTRA ACCOUNT)
Opelilt.ion Expense
5odal Security
Deferred Comp
Other Per50nnet
OCTOBER 2019 I FINAL
7,134,824 JOO% °" s 52,584,214 35% 42% 23% °" $ 2,629,102 100!1
165,978 loo,I
56,566,723 90!I 5% s" °" 119,080,841 76,218,724 24,991,168 15,0?S,868 2,795,080
1,832,017 600,69S 362:,368 (2,795,080)
119,080,841 78,050,741 2S,S91,864 lS,438,236
100% 66% 21" 13" ""
fYe 2020 ALLOCATION Fl.OW BOO TSS Ai; .A.II Othet1
l,S36,S13
60,778
25,552
20,000
314,544
1,584
23,939
380
2,100
8,153
14,837
4,107
39,690
190,681
199,527
AsAIIOthtts
AsAltOtheB
NAIJOtlwn.
AsAIIOtl,e,s
AsAIIOtl,.,.
AsAlf Othe~
/4S All Othl'rs.
As All Otho<>
A5All0theB
AsAltOtllen
AsAIIOthtrs
AsAIIOt.hor>
/!u All OtheB
As All Other>
As All Other>
As Alf Others
As All Othors
As All Other>
As AIIOthe"
M All Other,
AsAIIOthus
AsAIIOthoB
As All Othor>
As All Othor>
/!u AIIOthiers
AsAII Other,
As All Othe-n
"" "" "" '°"" "" "" "" 100%
"" "" "" 100"
°" °" "" 100%
"" "" o" 100%
"" "" "" 100%
°" °" °" 100%
°" °" °" 100%
"" "" °" 100%
"" "" "" 100%
"" °" "" 100%
°" "" "" 100%
"" "" "" 100%
°" "" "" 100%
"" "" "" 100%
"" "" "" 100%
"" "" "" 100%
"" "" °" 100%
"" "" "" 100%
"" "" "" 100%
"" "" °" '°"" "" °" °" 100%
°" "" "" 100%
"" "" "" 100%
°" °" °" 100%
"" "" "" 100%
"" "" "" 100%
Nov. 19, 2019 Item #16 Page 48 of 158
Maint.nan(:• Ii [quipm•nt
OtMJ Mach & £quip
Vehtde Rentals
Mhcl\t'ntab
Mkc:lt>ases
Offlt:e EqWp Malnt
Communk:.11tlon EqYip M1lnten1nc;e
So~r• Millnten~nc;e
Com11',1Cr Milll'l!Cl\ll'tt
\l'dtide Marn.1eNn«
Other Equip M.11int
Plpeline Ma&unanc:e
Routlrve &uHdtnc Malnte11ance
Maintcnanc;e, Re:p,,tr arld R~b
Audi< ,,..,
Admlflis1r1ttve
M~ ProfcuioNI SeMees
EndM~«$
Enclna St~ {Pt:nslcn Pay0tf)
MiU;tlJa~Ll$0tll1'dt.5eM'ees
Comm Arts S:uppon
RquNtory/P«mit~ Fus
Misc.SttvicH
Laundiy and Untlom, Mllnteance
Elt'ct:rlcat/SJ:>DA.s.tvicH
FOG lMl)tctkln Strkts
Sman:cov-e, wtfl/Al•rm 5erViUI
Landselping sei"'Ates
Ack and P!Jblishll'II
Dues end SUMCl'fptlo ns
BookS and Putitkatlons
Audio Vista I M&tt>rlak
Prlntq
Post•~
Office. SUppHiu
Offlca Fumltun & Equipnwnt
CompYter SOftw.ue
Misc. Comput« Hardware
Promo M.1tt'ffals
Food Expense
Hntar.dUght
T~epho~ & Convnunlcatlons
Waste Dtspoal Sefvk@s
Watl!I
Bul\diricM11lt'lttN1net:
ileet ... l!Upplle>
J1nltorial Suppl:IH
P.an.s-Vehldes
f'af'U-Eq,iSp
Rock ,1nd Mine-ral Products
Smal Tools
Safety Equipment
Um"ormsandAotusortu
Metet$/Flttlng1
~ONI Protective IEQU[pmcnl
Guollnc 11nd Oil
ChCmic:.411$
TqininQ~
M\SCSIJl)flltt:I,
Employ,tt Tralnfnc
TiUlllon Aelmbutsefflent
Tralninc/fralnfnl Relattd Travel
O!predatlon
Confer~-e Travel
Mlsc. Mnls/MRt:s
Bad Otht Exp• OUwr lrw/ailb
R~Owr/Sbort
NED Rcnt•I AssfsUt'ICe. Payn,~nu
btcnlA»bt1nc~ Pror,:1m
Conti~ies
Vehrelt Direct Charses
Vet.Ide Maintenance (2)
Vehkle Repla,cemMt
G!!l\t/111IUab
lnformat[on tec:hnolodes
Mkc lnlttdt'partmf:nnil Ch.af)tS
Misd:l&BKk
Ut!Mty8i11IntChar&e~ct
flsc1I Agt-nt Fff$
Arbi':~f;eCc»U
lnte,estEicpense
Int Exp..Caplt•R:zed lnwest
Other. HHt & Ucht
Other· Parts & E~prr.ent
Other• SINn Cown. Adcft, Malnlffllnat & Equlpmt"nt
Othl!lr M1lntm1~ & Equipment
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
. . . " .
-AIAHOthffl "" "" "" "''" 1,000 flow,_.., "'"" "" "" "" ~000 Flow,_ "'"" "" "" "" flow an,v 1009' "" "" "" 500 FlowOdv 1009' "" "" "" 1,000 Flowonlv 1009' "" "" "" 74,lSO flow~ 1009' "" "" "" FIOWontv 1009' "" "" "" 500 flown..a.. 1009' "" "" "" 2,500 1-lowr-. "'"" "" "" "" FfOWntiN '""" "" "" "" 141,0CO Flew......._· '""" "" "" "" Flow-'""" "" "" "" 10,000 FIClwnr.tv '""" "" "" "" 3,000 flow<:Mv "'"" "" "" "" As/,l)OO>tff "" "" "" 1009'
JiUAltOthtn "" "" "" 1009'
As AltOllMn "" "" "" 1009'
U0,000 AsAIIOthm "" "" "" 1009'
4,101,976 llow/llODlr>.S 35" .,,. ,.,. "" 953,!j()S Flow/90DITSS "" .,,. ,.,. "" 170.000 IUAltOllMn "" "" "" '""" JuAIIOthH's "" "" "" '""" -JuAAOlher1 "" "" "" '""" 32,000 ,,_,_ 1009' "" "" "" AsAlt°""" "" "" "" "'"" 5,000 /UAIIOCbtn "" "" "" '""" 20,000 flow°"'" "'"" "" "" "" 46,000 JuAIIOthm "" "" "" '""" 85,000 AJAlfOlMn "" "" "" 1009'
65,000 MA!IOlhm "" "" "" '""" zooo JUAIIOlhtn "" "" "" 1009'
11,000 kAllOlhen "" "" "" '""" 500 .. .,,°""" "" "" "" 1009'
IU/,l)Olhon "" "" "" 1009'
1,500 AIAIIOlhon "" "" "" 1009' ,,,oo A.sAJ1'0thns "" "" "" 1009'
5,000 MAlf:Qhffl "" "" "" 1009'
2,000 AsAIIOthm "" "" "" 1009'
10,000 MAll'otMn "" "" "" 1009'
3,000 As AllOthtrJ "" "" "" 1009'
~000 A.sAIJOthffl "" "" "" 1009'
/U A/IOlhon "" "" "" '""" 28',000 .... °""" "" "" "" '""" 23,000 .... """" "" "" "" '""" 15,000 "'"'"""" "" "" "" 1009'
36,000 .... """" "" "" "" '""" .AsAIIOthm "" "" "" 1009' zooo "'Alt°""" "" "" "" 1009'
300 MAltOtbtn "" "" "" 1009'
5,000 As AIIOtt,Ks "" "" "" 1009'
106,000 ,....-1009' "" "" "" 1,000 .. AJIOUNN "" "" '"' """ m .,AIIOthm "" '"' "" 1009'
t500 .. A/10thm "" "" "" 1009'
18.000 .,,i,_ "" "" "" 1009'
3,000 /U All0«W$ "" "" "" '""" "'AIIOthtn "" "" "" 1009' .,All"""" "" "" "" 1009' zooo AsAIJothet1 "" "" "" 1009'
60,000 Flow= 1009' "" "" "" MAltOlhtn "" "" "" 1009'
,.AIIOllMn "" "" "" '""" 20,000 kAIICXhars "" "" "" 1009'
500 ,., .. OllMn "" "" "" '""" .. AltOdl,,, "" "" "" 1009'
3,000 .... """" "" "" "" 1009'
"'"'°""" "" "" "" 1009'
2S,000 "'AJIOthon "" "" "" '""" 5,000 ,-A11011,en "" "" "" 1009'
MAIJOthffl "" "" "" 1009'
Hi,000 HAJl<>l,m "" "" "" 1009'
AJAltOlhffl: "" "" "" 1009'
50,000 AsAltOlhltt. "" "" "" 1009'
As/JJOthers "" "" "" '""" 440,000 MAIIOthon "" "" "" 1009'
71,300 As AIIOthers "" "" "" 1009'
""·""' MAIIOthffl "" "" "" 1009'
217,766 A1-AIIOth«s "" "" "" '""" 54,840 As AIIOtNn "" "" "" 1009'
187.104 As AJIOtheD "" "" "" '""" 741,110 .MAllOUwn "" "" "" '""" MAll0thon "" "" "" l-,.Al100-"" "" "" l-.. AJIC!dvn "" "" "" '""" AI...Uothers "" "" "" '""" .. AIIOlhtn "" "" "" 1009'
AsN!Ot~ "" "" "" '""" JuAIIOthen "" "" "" '""" MAIIOllMn "" "" "" '""" JdAIIOther1 "" "" "" 1009' .... """" "" "" "" '""" "'All0thon "" "" "" """' MN.I~ "" "" "" l"°"
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 49 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Caphal Outlay
C.ipital Outlay< $10k • New
Ca pita I Outlay< $10k -Rep I
Cap Outlav -Vehicles
Comput~r Equip~ S 10k • Repl
Office Equipment
Other Equipment
Office Furniture
Capital12:ed ASUlS
Other Capft~I 01.Jtlar;
Othe.r Financing UsH
Transfers Out
Transfer Out• ~ht Service
Operat1ng £xpenditure5Sub Total
Reallocation of "As AO Others•
Total Allocation
Perc.entage Allocation
' ' . .
$ Plant In Service
Plant In Senrice
Plant In Seivice
Plant In Se-Nice
Plant In Servfce
Pl~ nt In Service
Pl.im In Seniice
Plant In seMce
Plant In Sef\l'ice
lndude<lbelow As All Others
AsAII 0th!!~
10,807,2S3
10,803,213
100%
HOW BOD T.SS As All Ofhe,n:
66% m, 13% 0%
66% 21% 13% 0%
66% 21" 13" 0%
66% m, 13% 0%
66% 21" 13% 0%
66% 21" 13" 0%
66l' 21" 13% 0%
66% 21" 13% 0%
66% 21" 13% 0%
"" 0% 0% 100%
"" 0% 0% 100%
2,199,996 2,130,749 1,ln,486 5,294,982
2,114,824 2,D48,2$3 1,131,900 (5,294,982)
4,314,820 4,179,007 2,309,386
40% 39" >1%
RATE REVENUE f.!EQUUU:MENT FYE 2.()20 At.LOCATION FLOW 800 TSS A,: ,6,11 0Jhufl.
Operating E,xpense-5 10,803,213 ASO&M
One-Time Funding Plant ln Seivke
Rate Funded Capital Plant In SeNk:e
Replacement FwidJ,-g {Depreciation Funding} 3,800,000 Plam lnServfce
Transfers to Capital Fund 2,975,000 Plant In Service
Coverage Driven Increase Plant In Service
Adjustment for Mid Ye;ar Increase 240,749 As All Other>
Ley Offsetting RevenuM
Over/Under Collection of Revenues s (3,241,279) As All Other>
Fines and Forftit1A·e1 (87,800) As AllOthen
Income from Property & lnvestment'5 (161,870) AsAIIOthen
Interdepartmental (83,400) As All Other>
Other Revenues (74,800) As Al other>
Connect.On Fees Plant In service
Total ~te Revenues to be Collect@d 14,169,813
Realloation of '"As All Others"'
Total Aftoc.ation 14,169,813
OCTOBER 2019 I FINAL
40% 39% 66" 21"
66l' 21%
66% 21%
66% 21"
66" 21%
0% 0%
"" 0%
0% 0%
0% 0%
0% 0%
0% 0%
66% 21%
8,755,.448 S,635,034
(1,697,674) (1,092,628)
1,os1,ns 4,542,406
21%
13%
13%
13"
13%
13%
0%
0%
0%
0%
0%
0%
13%
3,187,731
(618,098)
2,569,632
0%
0~
0%
0%
0%
0%
100%
100%
100%
100%
100%
100%
0%
(3,408,400)
3,408,400
Nov. 19, 2019 Item #16 Page 50 of 158
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
Appendix E
WASTEWATER CUSTOMER ALLOCATION
GROUP I -CROUP II_ GROUP Ill -GROUP IV.. GROUP V • GROUP V • G~OUP V-GROUP V. GROu, VI -lndudrial
CUSTOMER S"TATISTICS GROUP I• SFR MRF/MO&llE I I El•mcntory Junior High H h Soord1ng Orew■mu. la,ge Volume P,e1reotment TOTAL
! HOME Comme,cio 'l ComMlr(•O 3 Comn1t rclol 4 Sthooh, Stl-,ooh 19h St ooh. Sthoola {no otcounl•) Clou Ill
Assumed Row (ccf)
SOD(lb<)
TSS[lb<)
EOUs [Monthly)
2,095,027 ccf
2,615,584 lbs
2,615,584 lbs
21,64S EOUs
S36,781 cd
670,1S61bs
670,1561bs
S,S46EDUs
427,847 ccf
348,060lbs
320,097 lbs
3,605 EDUs
460,388ccf
943,60011>$
801,.S01 lbs
6,075 EOUs
161,631 ccf
827,349 lbs
686,094 lbs
4,056EOUs
16,214 ccf
13,lSSlbs
10,12111>$
134 EDUs
9,570ccf
7,766 lbs
5,974 lbs
79 EOUs
17,804 cd
14,4481b5
11,114 lbs
147!DUs
7,096 ccf
5,758 lbs
4,430 lbs
S8EOUs
Occf
Dibs
Olt>s
OEDUs
Occf
Dibs
Olbs
OEOUs
4,465ccf 3,736,824 ctf
8,301 lb> S,454,18"1 lbs
13,269 lbs S, 138,340 lbs
65 EDUs 41,409 EOUs
GROUP I-GROUP II• GROUP HI_ GROUP IV. GROUP V -GROUP V-GROUP V-GROUP V -GROUP VI• lndu1tuol
FLOW CROUP 1-SFR MRF/M061lE Elemonto,y Junior 1-i1gh I h Roardfng 8rcw•tl•~ large Volumt Prn·hearmtnl Totol HOMf Con1me1tlal 'l Commer(lol 3 Comnierclal 4 Schooh S,hool'i H 9 Sc;hooh School, (no otccun!G) Clou 111
Allocation Basis: I AUl#llfd Flow c«n I· Assumed flow (ccf) 2,095,027 536,781 427,847 460,388 161,631 16,214 9,570 17,804 7,096 0 0 4,465 3,736,824
Allocation Adjustment Fac1or 1.0 1,0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 LO
Adjusted Assumed Flow (ccf} 2,095,027 536,781 427,847 460,388 161,631 16,214 9,S70 17,804 7,096 0 0 4,465 3,736,824
Allocated Cu$tomer Costs 3,956,8~8 1,03.3,823 $ 808,078 869,539 $ 30S,27S 30,624 18,076 33,627 13,402 8,434 7,057,1'75
GROUP I• OROUP II• GROUP Ill_ GROUP IV. GROUP V • GROUP V • CROUP V. GROUP V • OROUP VI· lndu1triol
800 GROUP I• SFR MRF/MO61LE Eleman1a,y Juruor ~19h h 8001d1ng Brewe11H large Volume P1etreatment Totol
HOME Cammerclul 2 Comm~rciol 3 Comm•rcial 4 Sthooh Sthooh High Sc ooh Schools ,no account•) Clau Ill
Allociltion Basis: 1,00..,.1 I:::_
80D(lt,,) 2,615,584 670,156 348,060 943,600 827,349 13,158 7,766 14,448 5,758 0 0 8,301 S,4S4,181
Allocation Adjustment Factor LOO 1.00 1.00 LO 1.0 1.0 1.0 1,0 1.0 1.0 1.0 1,0
Ad]usto<I BOD (lb>) 2,615,584 670,156 348,060 943,600 827,349 13,158 7,766 14,44! 5,758 0 0 8,301 S,454,181
Allocated Customer Costs: 2,178,337 5S8,126 s 289,875 785,859 689,041 10,958 6,468 12,033 4,796 6,913 4,542,406
GROUP 1.. GROUP 11.. GROUP Ill -GROUP IV-GROUP V.. GROUP V -GROUP V-GROU~ V -. GROUP VI.. lndu1tdal
TSS GR:OUP I• SFJI MRF(MOBILE , I I I Elomonlary Junior 1-l,uh , h S I Boarding B,ciwor1e1 Lorge Volu,ue Pret,eatment Tolal
MOME Comme,c.u, '2 Comm-,(/a 3 Comm•rc10 4 School• Schooh H19 choo • Schooh (no occounh,} Clan Ill
Allocatlon Basis: jm;sq l· TSS [lbs) 2,61S,58.I.I 670,156 320,(197 801,501 686,094 10,121 5,974 11,114 4,430 0 D 13,269 5,138,340
Allocation Adjustment Factor 1.0 1.0 1.0 1.0 1.0 1-0 1.0 LO 1.0 1.0 1.0 1.0
Adjusted TS5 (11>$) 2,615,584 670,156 320,097 801.S01 686,094 10,121 5,974 11,114 4,430 0 D 13,269 5,138,340
Allocated Customer Cos.ts 1,308,027 335,138 160,on 400,823 343,109 5,062 2,988 S,S58 Z21S 6,636 2,569,632
GROUP I -GROUP U. GROUP Ill• GROUP IV. GROUP V • Elem•nll:111 GROUP\/. CROUP\/. GROUP 't/. GIOUP VI• lndu,ltrnl COST ALLOCATION SUMMA.RY GROUP f. SFl't MRf/MOBllE . S I V Junior High I 0oordlng Biuw•rlH La,u• Velum• P,eheohr,enl To!al ., MOME Commorc,ol 2 Comme,clal 3 Comri,crclol 4 choo, School, High Schoo, Schoolt (no accounh} Ctou Ill
FLOW 3,956,898 1,013,823 803,078 869,539 305,275 30,624 18,076 33,627" 13,402 8,434 7,.0'S7,77S
BOO 2,178,337 553,126 289,875 785,859 689;04-1 10,9.58 6,468 12,033 4,796 6,913 4,542,406
TSS 1,308,027 335,138 100,on 400,823 343,109 S,062 z••s S,SS8 2,iis 6,636 2,Sfig,632
TOTAL 7,443,262 1,907,087 1,258,031 2,056,221 1,337,425 46,644 27,531 51,217 20,413 21.983 14,169,813
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 51 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Appendix F
RATE DESIGN
GROUP I -SFR # OF ACCOUNTS FLOW [cd) BOD [lbs) TSS [lbs)
Actual annual(# of bills)
Actual monthly
Monthly units
Monthly Amount Allocable Charge per month
Total to be Collected
Calculated Above
Difference
GROUP I -MRF/MOBILE HOME
# of Accounts below minimum (Annually)
Minimum Charge
s
$
$
Revenues to be Collected $
259,723
21,644
$0.00
120
$14.33
1,719.51
2.095,027
174,586 .
$8.07
$1S.24
$ 3,956,898
s 3,956,898
$
Assumed Flow
482
2,615,584
217,965
$10.07
$8.39
$ 2,178,337
$ 2,178,337
$
Monthly Rate
Assumed BOD
601.47
2,615,584
217,965
$10.07
$5.04
$ 1,308,027
s 1,308,027
$
$ 28.661
Assumed TSS
601.47
# OF ACCOUNTS FLOW {eel) BOD (lbs) TSS [lbs)
Actual annual(# of bills) 12,421 S36,781 670,156 670,156
Revenues s s 1,013,823 s 558,126 $ 335,138
Removal of Min Charge Revenues (914.10) (503.23) (302.17)
Revenues to be Collected $ -$ 1,012,908 $ 557,623 $ 334,836
Effective Unit Charge $0.00 $1.89 $0.83 $0.50
Actual annual w/o Minimum Charge Accounts 12,301 536,299 669,554 669,S54
Actual monthly w/o Minimum Charge Accounts 1,025 44,692 55,796 55,796
Monthly units w/o Minimum Charge Accounts 43.60 54.43 54.43
Monthly Amount Allocable Charge per month $0.00 $82 .. 35 $45.33 $27.22
Total to be Collected s s 1,012,908 $ 557,623 $ 334,836
Calculated Above 1,013,823 558,126 335,138
Difference $ $ (914.10) $ (503.23) $ (302.17)
See "Bills at or below minimum" tob for colculotion on II of accounts below minimum.
Per ccf Rate $ 3.381
OCTOBER 2019 I FINAL C c;a,,,-••~·
Nov. 19, 2019 Item #16 Page 52 of 158
GROUP II -Commercial 2
# of Accounts below minimum (Annually)
Minimum Charge
Revenues to be Collected $
Total Accts & Usage
Revenues $
Removal of Min Charge Revenues
Revenues to be Co fleeted $
Effective Unit Charge
Actual annual w/o Minimum Charge Accounts
Actual monthly w/o Minimum Charge Accounts
Monthly units w/o Minimum Charge Accounts
Monthly Amount Allocable Charge per month
Total to be Collected $
Calculated Above
Difference $
Wastewater Cost of Service Study I FYE 2020 WASTEWATER RATES I CARLSBAD
2,S68
$i4.33
36,797.46
Assumed Flow
7,701
Assumed BOD
6,264.84
Assumed TSS
5,761.52
# OF ACCOUNTS FlOW (ccf) BOD (lbs) TSS (lbs)
13,444 427,847 348,060 320,097
$ 808,078 $ 289,87S $ 160,077
(23,636) (8,479) (4,682)
$ 784,442 $ 281,396 $ 155,395
$0.00 $1.87 $0.82 $0.49
10,876 420,146 341,796 314,335
906 35,012 28,483 26,19S
38.63 31.43 28.90
$0.00 $72.12 $25.87 $14.29
s 784,442 $ 281,396 $ lSS,395
808,078 289,875 160,077
$ (23,636.33) $ (8,478.86) $ (4,682.27)
See "Bilis at or below minimum" tab for calculation on II of accounts below minimum.
GROUP Ill -Commercial 3
# of Accounts below minimum (Annually)
Minimum Charge
Revenues to be Collected $
113
$14.33
1,619.20
Assumed Flow
275
Per ccf Rate $ 2.so I
Assumed BOD
563.90
Assumed TSS
478.98
# OF ACCOUNTS FLOW (cd) BOD (lbs) TSS (lbs)
Total Accts & Usage 3,498 460,388 943,600 801,501
Revenues $ $ 869,539 $ 785,859 $ 400,823
Removal of Min Charge Revenues (685) (619) (316)
Revenues to be Collected $ $ 868,855 $ 785,240 $ 400,507
Effective Unit Charge $0.00 $1.89 $0.83 $0.50
Actual annual w/o Minimum Charge Accounts 3,385 460,113 943,036 801,022
Actual monthly w/o Minimum Charge Accounts 282 38,343 78,586 66,752
Monthly units w/o Minimum Charge Accounts 135.92 278.57 236.62
Monthly Amount Allocable Charge per month $0.00 $256.66 $231.96 $118.31
Total to be Collected $ -$ 868,855 $ 785,240 $ 400,507
Calculated Above 869,539 785,859 400,823
Difference $ $ (684.73) $ (618.84) $ (31S.63)
See "Bills at or below minimum" tab far calculation on II of accounts below minimum.
Per ccf Rate $ 4.25 1
FINAL I .OCTOBER 2019
Nov. 19, 2019 Item #16 Page 53 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
GROUP IV -Commercial 4
# of Accounts below minimum (Annually)
Minimum Charge
Revenues to be collected $
Total Accts & Usage
Revenues $
Removal of Min Charge Revenues
Revenues to be Collected $
Effective Unit Charge
Actual annual w/o Minimum Charge Accounts
Actual monthly w/o Minimum Charge Accounts
Monthly units w/o Minimum Charge Accounts
Monthly Amount Allocable Charge per month
Total to be Collected s
Calculated Above
Difference $
13
$14.33
186.28
Assumed Flow
15
Assumed BOD
74.75
Assumed TSS
61.99
# OF ACCOUNTS FLOW (ccf) BOD (lbs) TSS (lbs)
1,426 161,631 827,349 686,094
-$ 305,275 $ 689,041 $ 343,109
(43) (96) (48)
$ 305,232 $ 688,94S $ 343,061
$0.00 $1.89 $0.83 $0.50
1,413 161,617 827,274 686,032
118 13,468 68,940 57,169
114.37 585.43 485.48
$0.00 $216.00 $487.54 $242.77
$ 305,232 $ 688,945 $ 343,061
305,275 689,041 343,109
$ (42.52) $ (95.97) $ (47.79)
See "Bills at or below minimum• tab for calcu/otion an #-of accounts below minimum.
Per eel Rate $ 7.871
GROUP V -Elemenrary Schaal, # OF ACCOUNTS FLOW (ccf) BOD (lbs) TSS (lbs}
Actual annual 228 16,214 13,158 10,121
Actual monthly 19.00 1,351.18 1,096.49 843.46
Monthly units 71.11 57.71 44.39
Monthly Amount Allocable Charge per month $0.00 $134.32 $48.06 $22.20
Total to be Collected $ $ 30,624 $ 10,958 $ 5,062
Calculated Above 30,624 10,958 5,062
Difference $ $ $ $
Calculated Revenues $ 46,644
Number of Students 6,874
$/Student Rate $ 0.57
LINE# GROUP V • Junior High Schools # OF ACCOUNTS FLOW {tcf) BOD (lbs) TSS (lbs)
139 Actual annual 48 9,570 7,766 5,974 •
140 Actual monthly 4.00 797.53 647.20 497.85
141 Monthly units 199.38 161.80 124.46
142 Monthly Amount Allocable Cha!]e ~• month $0.00 ~376.58 $134.75 ~62.24
143 Total to be Collected s $ 18,076 $ 6,468 s 2,988
145 Difference $ ~ 18,075.67 $ 6,468.12 $ 2,987.63
Calculated Revenues $ 27,531
Number of Students 2,719
$/Student Rate $ 0.85
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 54 of 158
Wastewater Cost of Service Study I FYE 2020 WA'STEWATER RATES I CARLSBAD
LINE# GROUP V. High Schools # OF ACCOUNTS FLOW (eel) SOD (lbs) TSS (lbs)
146 Actual annual 48 17,804 14,448 11,114
147 Actual monthly 4.00 1,483.66 1,204.00 926.16
148 Monthly units 370.92 301.00 231.54
149 Monthly Amount Allocable Cha!le eer month $0.00 $700.55 $250.68 $115.79
150 Total to be Collected $ $ 33,627 $ 12,033 $ 5,558
152 Difference $ $ 33,626.51 $ 12,032.76 $ 5,557.94
Calculated Revenues $ 51,217
Number of Students 3,774
$/Student Rate $ 1.14
GROUP V • 8oording Schools # OF ACCOUNTS FLOW [ccf) BOD (lbs) TSS (lbs)
Actual annual 12 7,096 5,758 4,430
Actual monthly 1.00 591.33 479.87 369.13
Monthly units 591.33 479.87 369.13
Monthly Amount Allocable Charge per month $0.00 $1,116.85 $399.65 $184.60
Total to be Collected $ . $ 13,402 $ 4,796 $ 2,215
Difference $ $ 13,402.19 $ 4,795.78 $ 2,215.17
Calculated Revenues $ 20,413
$/Student Rate 288
$/Student Rate $ 5.91
lnduslriol Pretreotmenr Clos, Ill # OF ACCOUl~TS FLOW (eel) BOD libs) TSS (lbs)
Actual annual 12 4,465 8,301 13,269
Actua I monthly 1 372 692 1,106
Monthly units $366.34 $681.03 $1,088.61
Monthly Amount Allocable Charge per month $0.00 $691.91 $567.18 $544.40
Total to be Collected $ $ 8,434 $ 6,913 $ 6,636
Calculated Above 8,434 6,913 6,636
Difference $ $ $ $
Per ccf Rate $ 4.681
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 55 of 158
CARLSBAD I FYE 2020 WASTEWATER RATES I Wastewater Cost of Service Study
Brewery Rate .
Assumed Brewery Waste Concentration w/ Restaurant w/o Restaurant
BOD mg/I 2,400 2,400
TSS mg/I 1,500 1,500
Secondary Use Concentration w/ Restaurant (C4) w/o Restaurant
(C2)
BOD mg/I 820 130
TSS mg/I 680 121
Wastewater from Brewing 50% 50%
Wastewater from Secondary Use 50% 50%
Effective Concentration w/ Restaurant w/o Restaurant
BOD mg/I 1,610 1,265
TSS mg/I 1,090 810
System Unit Costs
Flow $1.89 per HCF
BOD $0.83 per lb
TSS $0.50 per lb
Unit Costs per HCF Sewer Discharge
Flow $1.89 $1.89
BOD $8.36 $6.57
TSS $3.40 $2.53
Total Rate per HCF of Dischage $13.64 $10.98
Return to Sewer 82.500% 82.500%
B4Rate 82 Rate
Rate per HCF of Water Used $11.26 $9.07
Group II -Commercial $2.80 Bl Rate
Group IV-Commercial $7.87 83 Rate
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 56 of 158
( City of
Carlsbad
EXHIBIT 4
Carlsbad Municipal Water District
Water Cost of Service Study
FYE 2020 POTABLE AND RECYCLED
WATER RATE STUDY
FINAL I October 2019
Nov. 19, 2019 Item #16 Page 57 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Contents
Section 1-Introduction
1.1 Study Purpose
1.2 Overview of the Rate Setting Process
1.2.1 Revenue Requirement Analysis
1.2.1 Water Demand Analysis
1.2.2 Cost of Service Analysis
1.2.3 Rate Design Analysis & Calculation
1.2.4 Rate Adoption
1.3 Project Objectives
1.3.1 Rate Study Best Practices and Legal Considerations
1.4 Current Rate Structure
1.5 Project Findings and Recommendations
Section 2 -Inputs and Assumptions
2.1 Potable and Recycled Water System Profile
2.2 Forecast Assumptions
2.3 Water Demand
2.4 Water Supply
Section 3 -. Revenue Requ irement Analysis
3.1 Capital Improvement Plan Funding
3.2 Operating Revenues & Expenses
3.3 Recommended Revenue Requirements
3.3.1 Cash Flow Sufficiency Test
3.3.2 Debt Coverage Test
Section 4 -Cost of Service Analysis
4.1 Functional Allocation Analysis
4.1.1 Functional Cost Categories -Potable Water
4.1.2 Functional Allocation Factors
4.1.3 Functional Allocation Peak Factor Analysis
4.1.4 Functional Allocation Results
4.2 Customer Class Allocation
1
1
1
2
2
2
3
3
3
4
4
4
7
7
7
8
8
10
10
12
14
14
16
17
17
18
19
20
21
21
FINAL I OCTOBER 2019 I i
Nov. 19, 2019 Item #16 Page 58 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
4.2.1 Potable Volumetric Cost Allocation
4.2.2 Supply Allocation
4.2.3 Fixed Cost Allocation
4.2.4 Potable Water Customer Allocation Results
Section 5 -Rat e Design Analysis
5.1 Rate Structure Objectives and Goals
5.2 Proposed Water Delivery Fees
5.3 Proposed Water Usage Fees
5.3.1 Residential Rates
5.3.2 Commercial, Agricultural, and Irrigation Rate Design
5.4 Proposed Potable Water Rates
5.5 Proposed Recycled Water Rates
5.6 Proposed Fire Service Rates
5.7 Regional Water Rate Comparison
Appendices
Appendix A
Append ix B
Appendix(
Appendix D
Appendix E
Appendix F
Appendix G
Appendix H
Appendix I
Appendix J
Tables
Table 1
Table 2
Table 3
Table 4
Table 5
CUSTOMER AND DEMAND FORECASTS
WATER SUPPLY PURCHASES AND COSTS
CAPITAL IMPROVEMENT PLAN
PROJECTED O&M COSTS
REVENUE REQUIREMENT ANALYSIS
POTABLE WATER FUNCTIONAL ALLOCATION
RECYCLED WATER FUNCTIONAL ALLOCATION
POTABLE WATER CUSTOMER ALLOCATION
RATE DESIGN ANALYSIS
SUPPLY ALLOCATION
Proposed Water Usage Fees
Current Water Delivery Fees
Water System Customer Profile
Escalation Factors
Forecasted Water Demand by Customer Class (CCF)
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Table 6
Table 7
Table 8
Table 9
Table 10
Table 11
Table 12
Table 13
Table 14
Table 15
Table 16
Table 17
Table 18
Table 19
Table 20
Table 21
Table 22
Table 23
Table 24
Table 25
Table 26
Table 27
Table 28
Table 29
Table 30
Table 31
Table 32
Table 33
Table 34
Table 35
Table 36
Table 37
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Water Supply Purchases (AF,$ millions)
Capital Improvement Plan Expenditures -Potable Water($ millions)
Capital Improvement Plan Expenditures -Recycled Water($ millions)
Capital Improvement Plan Expenditures and Funding -
Potable Water($ millions)
Capital Improvement Plan Expenditures and Funding -Recycled Water
Current Rate Revenue($ millions)
Offsetting Revenues -Potable Water($ millions)
Offsetting Revenues -Recycled Water($ millions)
Expenditures-Potable Water($ millions)
Expenditures-Recycled Water($ millions)
Cash Flow Sufficiency Test -Potable Water($ millions)
Cash Flow Sufficiency Test-Recycled Water($ millions)
Debt Service Coverage Test-Recycled Water
Functional Allocation -Potable Water
System Demand Factors
Extra Capacity Allocations
Functional Allocation Results Summary-Potable Water
Customer Class Service Units
Supply Allocation -Step 1
Supply Allocation -Step 2
Supply Allocation Summary
Fixed Cost Customer Allocation Factors
Potable Water Customer Allocation Summary, FYE 2020 ($ millions)
Proposed Monthly Water Delivery Fees -Potable Water
Proposed Monthly Water Delivery Fees -Recycled Water
Proposed Monthly Water Delivery Fees-Fire
SFR Rate Design -Base, Max Day, Max Hour
SFR Rate Design -Supply Costs
SFR Rate Design Summary, FYE 2020
Proposed Multi-Family Residential Tier Allotments
MFR Rate Design -Base, Max Day, Max Hour
MFR Rate Design -Supply Costs
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CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Table 38 MFR Rate Design Summary, FYE 2020
Table 39 Commercial, Agricultural, and Irrigation Rate Design Summary, FYE 2020
Table 40 Proposed Potable Water Delivery Fees
Table 41 Proposed Potable Water Usage Fees
Table 42 Proposed Recycled Water Delivery Fees
Table 43 Proposed Recycled Water Usage Fees
Table 44 Proposed Fire Service Delivery Fees
Figures & Equations
Figure 1
Equation 1
Figure 2
Conceptual Overview of the Rate-Setting Process
Tier Peak Factor Formula
Regional Monthly SFR Water Bill Comparison
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Water Cost of Service Study I POTABLE ANO RECYCLED WATER RATE STUDY I CARLSBAD
Abbreviations
ADD
AF
AWWA
Carollo
ccf
CIP
CMWDor
District
Desai
DSCR
DU
FYE
LWD
Ml Manual
MOD
MEU
MFR
MGD
MHD
MWD
O&M
PERS
SCADA
SDCWA
SFR
Study
UAL
UMAPC
VWD
c · c::ar-"11·
Average Day Demand
Acre Feet
American Water Works Association
Carollo Engineers, Inc.
Hundred cubic feet
Capital Improvement Plan
Carlsbad Municipal Water District
Carlsbad Desalination Plant
Debt Service Coverage Ratio
Dwelling Unit
Fiscal year ending
Leucadia Wastewater District
Principles of Water Rates, Fees, and Charges: Manual of Wi;zter Supply Practices Ml
Maximum Day Demand
Meter Equivalent Unit
Multi-Family Residential
million gallons per day
Max Hour Demand
Metropolitan Water Dist rict of Southern California
Operations and maintenance
Public Employees' Retirement System
supervisory control and data acquisition
San Diego County Water Authority
Single-Family Residential
Cost of Service Study
Unfunded Accrued Liability
Uniform Member Agency Purchase Contract
Vallecitos Water District
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-This Page Intentionally Left Blank-
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Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Section 1 -Introduction
The Carlsbad Municipal Water District (CMWD or the District) supplies potable and recycled water to
approximately 28,900 connections within a 32.3 square mile service area in Southern California. In fiscal
year ending (FYE) 2020, the District is projected to deliver approximately 14,200 acre-feet (AF) of potable
water and 4,000 AF of recycled water to customers. The District currently purchases all of its potable
water supplies from the San Diego County Water Authority (SDCWA) and entered into an agreement
with SDCWA to purchase supplemental water supplies from the Carlsbad Desalination Plant (Desai).
Recycled water is produced at the Carlsbad Water Recycling Facility, as well as purchased from the
Vallecitos Water District.
1.1 Study Purpose
Carlsbad retained Carollo Engineers, Inc. (Carollo) to perform a comprehensive Cost of Service Study
(Study) of the District's potable water, recycled water, and wastewater systems and to develop a rate
plan for the upcoming five-year period, FYE 2020 through FYE 2024. Although this Study presents a five-
year rate projection, at this time the District is adopting rates for the next two years. Caroll o's analysis
was guided by the policies and practices of the District, industry best practices for cost of service analyses
as outlined by the American Water Works Association (AWWA), and requirements for establishing water
rates within the State of California. The findings and recommendations of this cost of service analysis for
potable and recycled water are detailed within this report. The findings of the cost of service analysis for
wastewater are provided by Carollo in a separate report.
1.2 Overview of the Rate Setting Process
Rate analyses are performed periodically so that revenues continue to adequately fund utility operations,
maintenance, and necessary capital investments. In California, water rates must adhere to the cost of
service requirements imposed by Proposition 218 and the State Constitution. Proposition 218 requires
that property related fees and charges, including water rates, not exceed the reasonable and
proportional cost of providing the.service. The District's last rate study was completed by Carollo in 2016
and provided rates for FYE 2017 through FYE 2019.
The District has obligations to safeguard and preserve the State's limited water resources. Article X (2) of
the State Constitution establishes t he need to preserve the State's water supplies and discourage the
wasteful or unreasonable use of water by encouraging conservation. To achieve these multi-faceted
requirements-rates that must simultaneously be equitable and reasonable, while providing a
conservation message-Carollo's cost of service approach tests the adequacy of existing revenues,
recommends additional revenues where needed, and develops rates built on comprehensive cost
allocation and customer data analyses.
Carollo reviewed the District's current cost of service rate setting process. The processes presented
below are advocated by the AWWA. While the process is described in a linear step by step approach, it is
an iterative process, where the ultimate objective is to balance revenues with costs in an equitable
manner for customers.
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CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
1.2.1 Revenue Requirement Analysis
The methodology that Carlsbad applies to
establish annual rate revenue needs is
consistent with industry standards
established by the Principles of Water
Rates, Fees, and Charges: Manual of Water
Supply Practices Ml (Ml Manual), which is
published by AWWA, a national industry
trade group that makes recommendations
on generally accepted practices in the
water and sewer industry. The revenue
requirements analysis compares the
forecasted revenues of the utility to its
forecasted operating and capital reserve
costs to determine the adequacy of the
existing rates to recover the utility's costs.
If any shortfalls exist, rates may need to
increase.
Revenue Requirement Analysis
Compares existing revenues of the
district to its operating, capital reserves,
and policy driven costs to establish the
adequacy of the existing cost recovery
levels.
Water Demand Analysis
Forecasts water sales based on historical
bill ings, modifications to the rate
structure, and any regulatory
restrictions.
-
Cost of Service Analysis
Identifies and apportions annual revenue
requirements to functional components
based on its application to the District's
system, and then allocates to customer
classes and tiers based on system usage.
Rate Design & Calculation
Considers both the level and structure of
the rate design to collect the distributed
revenue requirements from each class of
service
Rate Adoption
The Study presents the basis for the
rates proposed to be adopted in
compliance with Proposition 218
1.2.1 Water Demand Analysis
Forecasting water sales and purchases is a
critical component in the rate setting
process. As part of t he budget process, the
District forecasts the expected water
usage based on historical demand,
proposed changes to rates, regulatory
impacts, weather, and other variables.
These forecasted water demands are then
compared against forecasted revenue
requirements, and rates are developed in
order to recover costs. Future demands are
based on historic sales and escalated for
projected growth and per capita demand
changes.
Figure 1 Conceptual Overview of the Rate-Setting Process
1.2.2 Cost of Service ~alysis
This step builds a link between the District's revenue requirements and the proposed rates for each
customer. After determining the revenue requirement, this step outline the cost to deliver each unit of
water and to serve each customer. Th is process takes each item in the water system's budget and
allocates the items based on what function is served. For example, some cost items support the ability to
deliver additional, more expensive water, while other costs are incurred to provide customer service or to
fund capital replacement. Organizing the budget in terms of end function allows the creation of a nexus ·
between the budget item and the rate. This organization bridges the costs incurred by t he District and
the unique and varied benefits delivered to each customer.
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1.2.3 Rate Design Analysis & Calculation
The rate design involves developing a rate structure that proportionately recovers costs from customers.
The rate structure must be tailored to the customer demand and account profile; built upon a nexus
between costs and the rates that customers are charged; resilient enough to handle changing cost and
demand scenarios; and flexible enough to meet multiple other unique criteria.
The rate design allows the District to develop unit costs that can then be layered based on requirements
to meet customer needs. This is a critical process for establishing tiered rates, as increasing usage incurs
additional costs making excess water more expensive to provide.
The final part of the rate design analysis is the rate calculation. This provides the nexus between the
revenue requirements, the functional cost allocation, and the final rates that customers are charged. This
process connects planned expenditures to the designed rates by establishing rates to match the
estimated revenue generation with expenditures.
1.2.4 Rate Adoption
To comply with the requirements of Proposition 218, the results of the Study are documented in th is
Report to support the District's public outreach regarding the proposed changes and provide the
rationale and justifications behind the changes and the anticipated financial impacts. While the
document should be easily understood, it must provide sufficie nt detail to fully support and document
the rate setting process.
In order to adjust rates, the District must prqvide a written notice 45 days prior to adoption of the rates.
During this 45 day notice period, any property owner or tenant directly responsible for the payment of
water or sewer service fees may submit a written protest to the proposed rate increases. If written
protests against the proposed rate increases are not presented by a majority of affected District property
owners or customers, the Board of Directors will be authorized to adopt the rate increases.
As the fol lowing sections of this Report will demonstrate, this process creates a fair and equitable
foundation for each charge and rate that the District levies.
1.3 Project Objectives
The Study aims to achieve several objectives related to the District's rate setting, cost recovery, and
financial planning methodologies. Specific objectives for the project include the following.
1. Review of the current financial plans for the District's potable and recycled water systems to
identify opportunities to improve long-term financial standing.
2. Evaluation and development of policy recommendations for the existing potable water and
recycled water rate structures to achieve the objectives of the District. Namely, the rate
structure should:
• Be easy to understand.
• Promote water use efficiency/conservation.
• Maintain continued compliance with cost of service requirements.
3. Thorough documentation of the cost of service analysis, including the functional allocation and
classification of costs, and the allocation of costs among customer classes.
4. Preparation of a rate design framework that proportionately recovers costs from the District's
customers and meets the goals outlined above.
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The Study identifies what actions the District should implement to maintain the financial viability of the
system in light of changing consumer demands, increasing purchased water costs, regulatory
requirements, and future infrastructure investments.
1.3.1 Rate Study Best Practices and Legal Considerations
Rates are typically designed to achieve multiple objectives. While industry standards provide a basis for
testing reasonableness, this basis does not on its own meet legal requirements-particularly the unique
legal requirements for agencies in California.
Within the cost of service approach and legal requirements, an agency's practices form the basis ofthe
detailed rate structure design elements, making it distinct to the agency and the community it serves.
Within the District's rate structure, these policies and practices encompass the entire structure including
the selection of rate design, methodology for allotting the amount of water use within customer tier
allocations, and how costs are allocated to target water usage in upper tiers. With its rate structure, the
District is able to satisfy its policy and practices objectives and proportionally recover costs from its
customers.
1.4 Current Rate Structure
The CMWD maintains separate rate structures for potable and recycled water customers. The following
section identifies how the District is currently charging their potable and recycled water customers.
Currently, potable and recycled water customers have two components to their bill:
1. Water Delivery Fee.
2. Water Usage Fee.
The Water Delivery Fee is a fixed monthly charge. It is assessed based on meter size. It is intended to
capture the costs of the water utility associated with providing customer service for each account, as we ll
as the costs of providing the system capacity to serve each account. The customer service component of
the charge is equal to all customers while the capacity component is varied based on meter equivalent
ratios as identified in the A WWA M6 Manual Water Meters -Selection, Installation, Testing, and
Maintenance.
The Water Usage Fee is a volumetric charge based on the amount of water consumed each month, as
measured by each customer's water meter. It is intended to capture the costs of the water utility that
vary with the amount of water provided.
1.5 Project Findings and Recommendations
Based on the an~!ysis proj~cti~n~1·the Qi~1j-ic½ will need to increase water rate revenues to keep pace with
increases in wholesale water supply .costs,_inflationary increases in operating expenses, and necessary
capital improvements to the D'istrict's systems. The use of reserves to fund a share of capital projects will
help to minimize the necessary level of rate increases. It is recommended that the District reviews its
revenues and expenditures on an annual basis to verify that the implemented rates are adequately
recovering costs.
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The key findings and recommendations are as follows:
• Proposed Potable Water Rate Increases. Annual user rate revenue increases of 1.0 percent in FY
2019/20 and 2.0 percent in FY 2020/21 will be required to fund potable water activities. The
proposed user rates largely retain the District's current rate structure and will include a cost of
service adjustment in FY 2019/20 based on the updated cost of service allocations followed by an
across the board increase in FY 2020/21.
• Multi-Family Tiered Rates. The proposed rate structure reduces the number of tiers for multi-
family users from the current 3 tiers to 2 tiers. The customer data analysis showed customer
usage patterns have shifted and that that very little consumption now occurs within the third
tier. This, coupled with the relatively low level of variation in water usage per dwelling unit
among multi-family customers, led to the determination that the simpler 2-tier structure is most
appropriate at this time.
• Recycled Water Rate Increases. No recycled water rate increases will be necessary during the
study period.
• Minimum Operating Reserve. It is recommended that the District continues to complete financial
planning based on the current operating reserve policy that sets a m inimum o·perating reserve of
40 percent of annual operating expenses. In the future, the District could consider this policy to
increase the minimum reserve target with Council approval or implementing a best practices
target above the 40 percent minimum for financial planning.
Table 1 and Table 2 outline the current and proposed water usage and water delivery fees.
Table 1 Proposed Water Usage Fees
!
Current Rates I Proposed Rates
Customer Class ~ ; I = 1 ~-~ I Usage I FYE
2020 -r FYE 2021 Tier Rate T L. ·t 1.0% and
1m1 COS 2.0%
1 10 ccf $3.94 1 10 ccf $4.04 $4.13
Single Family Residential 2 18 ccf $4.69 2 18 ccf 4.42 4.51
3 >18 ccf $7.00 3 >18 ccf 7.04 7.18
1 5 ccf $3.87 1 5ccf $3.87 $3.95
Multi-Family Residential 2 10 ccf $4.67 2 >5 ccf 4.94 5.04 per dwelling unit (DU) basis
3 >10 ccf $6.97 N/A
Commercial N/A All Usage $4.22 N/A All Usage $4.27 $4.36
Agricultural N/A All Usage $4.53 N/A All Usage $4.62 $4.71
Irrigation N/A All Usage $5.16 N/A All Usage $5.31 $5.41
Recycled N/A All Usage $3.79 N/A All Usage $3.79 $3.79
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CARLSBAD I POTABLE ANO RECYCLED WATER RATE STUDY I Water Cost of Service Study
Table 2 Current Water Delivery Fees
Meter Size I Current Rates I FYE 2020 Proposed I FYE 2021 Proposed
Potable Mont hly Charge 1.0% with COS 2.0%
5/8" $24.72 $25.02 $25.52
3/4" 33.36 33.76 34.44
1" 50.62 51.25 52.28
1.5" 93.79 94.98 96.88
2" 145.58 147.45 150.40
21/2" 206.52 208.67 212.84
3" 266.52 269.88 275.28
4" 439.10 444.79 453.68
6" 870.76 882.05 899.69
8" 1,388.75 1,406.76 1,434.89
10" 1,993.06 2,018.92 2,059.30
Recycled Monthly Charge 1.0% with COS 2.0%
5/8" $23.69 $23.69 $23.69
3/4" 32.69 32.69 32.69
l" 50.70 50.70 50.70
1.5" 95.73 95.73 95.73
2" 149.75 149.75 149.75
21/2" 212.84 212.84 212.84
3" 275.90 275.90 275.90
4" 455.93 455.93 455.93
6" 906.18 906.18 906.18
8" 1,446.47 1,446.47 1,446.47
10" 2,076.82 2,076.82 2,076.82
Fire Monthly Charge 1.0% with COS 2.0%
5/8" $7.69 $7.77 $7.93
3/4" 7.82 7.89 8.05
l" 8.06 8.14 8.30
1.5" 8.67 8.74 8.92
2" 9.39 9.48 9.66
21/2" 10.24 10.33 10.53
3" 11.10 11.18 11.40
4" 13.53 13.62 13.89
6" 19.61 19.71 20.10
8" 26.91 27.01 27.55
10" 35.42 35.54 36.25
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Water Cost of Service Study [ POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Section 2 -Inputs and .Assumptions
2.1 Potable and Recycled Water System Profile
FYE 2018 customer consumption data was used as the basis for forecasted demand and rate calculations.
Table 3 summarizes the FYE 2018 number of accounts and demand by customer class, including
the percentage of the totals.
Table 3 Water System Customer Profile
I
Number of I Account I FYE 2018 I Demand Customer Class A t Percentage of D d ( f) Percentage of
ccoun s Total eman cc Total
Single Family Residential 24,333 84.3% 3,443,366 41.6%
Multi-Family Residential 1,125 3.9% 729,706 8.8%
Commercial 1,679 5.8% 1,278,130 15.5%
Agricultural 21 0.1% 89,904 1.1%
Irrigation 825 2.9% 860,450 10.4%
Subtotal: Potable Water 27,948 6,401,556
Recycled Water 877 3.0% 1,869,935 22.6%
TOTAL, ALL CUSTOMERS 28,861 100.0% 8,271,491 100.0%
* Line or column totals may not tie due to rounding
2.2 Forecast Assumptions
The escalation factors used in this analysis are based on a review of both long-term and recent cost
escalation fact ors from the Engineering News-Record Index, an industry benchmarking resource, and
based on input from Carlsbad staff based on realized cost escalations. Other costs were escalated based·
on recent and specific cost trends. The escalators used for the Metropolitan Water District (MWD) and
SDCWA pass-through costs are presented in Appendix B of this Study. Other escalation factors include
account growth and changes in per account demands from each customer class. These factors for both
potable and recycled water are presented in Table 4.
Table 4 Escalation Factors
Escalation Factor I FYE 2020 I FYE 2021 I FYE 2022 FYE 2023 I FYE 2024
General Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
Labor Inflation 3.0% 3.0% 3.0% 3.0% 3.0%
Labor-PERS (Normal Cost) 12.4% 13.2% 13.2% 13.2% 13.2%
Labor-PERS (UAL) 15.0% 14.4% 15.7% 16.5% 16.7%
Labor-Health Insurance 7.5% 7.4% 7.1% 6.9% 6.6%
Chemicals Inflation 5.0% 5.0% 5.0% 5.0% 5.0%
Utilities Inflation 5.0% 5.0% 5.0% 5.0% 5.0%
C c::,,,,.,,,..
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CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY J Water Cost of Service Study
Escalation Factor I FYE 2020 I FYE 2021 [ FYE 2022 I FYE 2023 FYE 2024
Construction Inflation 2.5% 2.5% 2.5% 2.5% 2.5%
Property Tax Increase 4.3% 3.8% 3.1% 3.7% 2.9%
Depreciation Funding 2.8% 2.1% 1.2% 1.2% 1.2%
Interest Income 2.1% 2.2% 2.3% 2.4% 2.5%
Customer Demand Growth 1.0% 0.9% 0.6% 0.2% 0.2%
2.3 Water Demand
Water demand drives several key components of the revenue requirement analysis, as a large portion of
the District's water revenues and O&M costs are tied to the amount of water usage. Forecasted water
demand was calculated using the customer demand growth escalation factor presented in Table 4.
Detailed projections of customer accounts and demands are included for reference in Appendix A.
Table 5 Fore casted Water Demand by Customer Class (CCF)
Customer Class I FYE 2020 I FYE 2021 [ FYE 2022 I FYE 2023 I FYE 2024
Single Family Residential 3,311,487 3,344,148 3,368,974 3,377,018 3,381,525
Multi-Family Residential 701,759 708,680 713,941 715,646 716,601
Commercial 1,245,801 1,248,662 1,249,785 1,252,666 1,259,515
Agricultural 86,461 87,313 87,962 88,172 88,289
Irrigation 827,495 835,657 841,860 843,870 844,997
Recycled 1,741,529 1,758,705 1,771,761 1,775,992 1,778,362
TOTAL ALL CUSTOMER 7,914,531 7,983,166 8,034,283 8,053,363 8,069,289 CLASSES
* Line or column totals may not tie due to rounding
2.4 Water Supply
The District obtains its water from SDCWA, which in turn has two main sources: imported water (largely
from the Colorado River) and locally produced water from the Carlsbad Desalination Plant.
Water purchased from SDCWA has historically been the source of potable water sold by the District.
From FYE 2014 to FYE 2018 the District purchased an average of 14,270 acre-feet annually of water from
SDCWA.
Desalinated water deliveries began in July 2016 per the Uniform Member Agency Purchase Contract
(UMAPC). The District is required to purchase a minimum 2,500 acre-feet per year. Additional Desai
purchases of 416 AF are projected from FYE 2021 and beyond. Desalinated water deliveries are
estimated to represent approximately 23 percent of the overall water delivery costs for FYE 2018.
The District produces recycled water at the Carlsbad Water Recycling Facility and purchases recycled
water from Leucadia Wastewater District (LWD) and Vallecitos Water District (VWD). In FYE 2018, the
amount of recycled water purchased from LWD was 278 AF and 2,116 AF from VWD. The purchase
8 I OCTOBER 2019 I FINAL C c:::ar-"#1·
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Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
contract with LWD expired in FYE 2019 and no future purchases are expected. Purchases from VWD are
projected at 2,200 AF in FYE 2020 and 3,000 AF thereafter.
The District has previously received a $100/AF rebate from MWD and a $200/AF rebate from SDCWA,
with a maximum annual allowable yield eligible for rebate of 5,000 AF. These rebates expired in FYE
2019. Table 6 presents a summary of the District's forecasted water purchases in FYE 2020 through FYE
2024. Detailed projections of water purchases and costs are included for reference in Appendix B.
Table 6 Water Supply Purchases (AF, $ millions)
Source of Supply I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
SDCWA
Water Purchases (AF) 12,883 12,595 12,690 12,727 12,760
Fixed Charges $6.5 $6.5 $6.8 $7.0 $7.3
Variable Charges $16.8 $16.6 $17.3 $18.3 $19.3
TOTALSDCWA $23.3 $23.1 $24.2 $25.4 $26.6
Desalination
Water Purchases (AF) 2,500 2,916 2,916 2,916 2,916
Fixed Charges $4.1 $5.0 $5.2 $5.5 $5.7
Variable Charges $1.9 $2.3 $2,.3 $2,.4 $2.5
Other Charges $0.9 $1.0 $1.1 $1.1 $1.2
TOTALDESAL $6.9 $8.4 $8.7 $9.1 $9.5
Recycled Water
Water Purchases (AF) 4,198 4,239 4,271 4,281 4,287
VWD Charges $2.20 $1.72 $1.77 $1.83 $1.88
TOT AL RECYCLED $1.67 $1.72 $1.77 $1.83 $1.88
TOTAL WATER PURCHASES $32.76 $34.52 ($ MILLIONS) $36.29 $37.91 $39.62
* Line or column totals may not tie due to rounding
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CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Section 3 -Revenue Requirement .Analysis
The revenue requirement analysis is a comprehensive test of a utility's fiscal health, scrutinizing the
adequacy of current revenues, and setting the basis for rate planning. It reviews the utility's revenues,
expenses, debts, and reserve policies, assessing the viability of each metric going forward. Where cash
flows and balances are insufficient, the revenue requirement analysis determines the needed additional
cash flows to meet all funding goals.
The District's FYE 2020 budget expenses serve as the base year for O&M costs. Furthermore, Carollo
collected information related to current cash and restricted fund balances and policies, the budgeted
capital improvement plan expenditures, and all other operating and non-operating future revenues and
expenditures.
Once the revenue requirement is established by compiling all of the District's cost drivers, two tests are
utilized to define the annual revenues necessary.
1. The cas/J Dow su.iit:ieocytest looks for a net positive cash flow at the end of each fiscal year. This
test looks at whether revenues exceed expenses; when they do not, this test recommends
additional revenue.
2. The second test is the delJI .service coverage le.st. Utility bond issuances regularly include a stipulation
that the agency maintain sufficient cash flows to cover the planned debt service, plus an
additional percent of that debt service, typically between 25 and 40 percent.
3. Operating and Capital Budgets.
3.1 Capital Improvement Plan Funding
Though the District's CIP spending has been limited in recent years, significant improvements will likely
be required over time as the system ages. An analysis of the District's current assets found that the
system's total replacement value is approximately $1.3 billion for potable water assets, and $300 million
for recycled water assets. The prudent financial planning which led to reserve balance the District has
accumulated can be used to offset rate requirements at the time that improvements need to be
undertaken.
The District is in the process of finalizing a master plan for the potable and recycled water systems and
recently completed an asset management plan and a SCAD A assessment. Based on the results of those
studies, the District plans to increase capital investment over the coming years.
Table 7 and Table 8 summarize the projected capital improvement plan (CIP) expenditures for the
potable and recycled water systems. A detailed summary showing the District's projects can be found in
Appendix C.
Table 7 Capital Improvement Plan Expenditures -Potable Water($ millions)
CIP j FYE 2020 j FYE 2021 j FYE 2022 I FYE 2023 j FYE 2024
Connection Fee Fund Projects $1.5 $0.0 $6.3 $1.8 $0.3
Replacement Fund Projects 8.8 7.3 12.1 16.2 18.2
TOTAL POTABLE WATER PROJECTS $10.3 $7.3 $18.4 $18.0 $18.5
TOTAL ESCALATED COST $10.6 $7.6 $19.7 $20.0 $21.2
* Line or column totals may not tie due to rounding
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Table 8 Capital Improvement Plan Expenditures -Recycled Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Connection Fee Fund Projects $0.0 $0.0 $0.0 $0.0 $0.0
Replacement Fee Fund Projects 0.9 1.0 1.1 0.9 1.1
TOTAL RECYCLED WATER PROJECTS $0.9 $1.0 $1.1 $0.9 $1.1
TOTAL ESCALATED COST $0.9 $1.0 $1.2 $1.0 $1.2
* Line or column totals may not tie due to rounding
The District's potable CIP expense and funding is shown in Table 9 and Table 10. The transfers and
replacement funding line item represents the transfer of operating revenues to the capital reserve for
depreciation funding as well as additional transfers for cash funding of capital. As shown in the tables,
the District plans to draw on the reserves to fund CIP projects over the next several years.
An important aspect of the capital funding plan is that the District intends to draw on both existing
replacement reserves and existing connection fee reserves to fund capital projects. Since the
implementation of the District's existing connection fees, reduced water consumption due to
conservation and changes in planned developments have reshaped the CIP projects that are necessary to
serve new users. While some of the projects initially conceived and included in the connection fees have
changed, other projects have been modified or expanded to take their place. Further, replacements and
upgrades to the District's existing infrastructure are required to maintain the assets that serve new users
and to maintain the excess system capacity that w ill be needed to serve users that have not yet
connected to the system. To these ends, the District plans to allocate existing connection fee reserves, as
well as a share of future connection fees, to pay for replacement projects that have an excess capacity
component. The District will be updating their connection fees in a future study later this year.
Table 9 Capital Improvement Plan Expenditures and Funding -Potable Water ($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Beginning Capital Funds Balance $88.9 $87.6 $89.1 $78.5 $66.6 (Connection Fee and Replacement)
Transfers and Replacement Funding $6.1 $6.2 $6.3 $6.4 $5.8
Interest $1.0 $1.0 $1.3 $1.2 $1.0
Connection Fees $2.0 $1.9 $1.4 $0.5 $0.4
Use of Funds for Projects ($10.3) ($7.6) ($19.7) ($20.0) ($21.2)
Year-End Balance $87.6 $89.1 $78.5 $66.6 $52.7
Change in Reserves ($1.2) $1.5 ($10.6) ($11.9) ($14.0)
* Line or column totals may not tie due to rounding
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Table 10 Capital Improvement Plan Expenditures and Funding -Recycled Water
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Beginning Capital Funds Balance $12.4 $11.7 $10.9 $9.8 $9.0 (Connection Fee and Replacement)
Transfers and Replacement Funding $0.0 $0.0 $0.0 $0.0 $0.0
Interest $0.2 $0.2 $0.2 $0.1 $0.1
Connection Fees $0.0 $0.0 $0.0 $0.0 $0.0
Use of Funds for Projects ($0.9) ($1.0) ($1.2) ($1.0) ($1.2)
Year-End Balance $11.7 $10.9 $9.8 $9.0 $7.9
Change in Reserves ($0.7) ($0.9) ($1.0) ($0.8) ($1.1)
* Line or column totals may not tie due to rounding
3.2 Operating Revenues & Expenses
Operating revenues and expenses were projected for the next five years by applying the escalation
factors outlined in Table 4 to the District's FYE 2019 budgeted revenues and expenditures. Table 11
shows the District's projected potable and recycled water rate revenues for FYE 2020 through FYE 2024,
before applying any proposed rate increases. Increases in commodity charge revenue is projected on a
combination of customer demand growth and usage growth, while delivery charge revenue is escalating
due to customer demand growth. Recycled water revenues escalate in the same manner. Detailed
projections of O&M costs are included for reference in Appendix D.
Table 11 Current Rate Revenue($ millions)
Revenue Item I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Potable Water
Commodity Charges $28.31 $28.56 $28.74 $28.81 $28.86
Delivery Charges 11.90 12.01 12.08 12.11 12.13
TOT AL POT ABLE WATER $40.21 $40.56 $40.83 $40.92 $40.99
Recycled Wat er
Commodity Charges $6.68 $6.74 $6.78 $6.80 $6.81
Delivery Charges 1.11 1.12 1.13 1.13 1.13
TOTAL RECYCLED WATER $7.79 $7.86 $7.91 $7.93 $7.94
* Line or column totals may not tie due to rounding
In addition to above rate revenues, the District also receives other offsetting revenues. Table 12
summarizes the projected offsetting revenues for the potable water funds, and Table 13 summarizes the
projected offsetting revenues for the recycled water funds.
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· Table 12 Offsetting Revenues-Potable Water($ millions)
Revenue Item I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Other Charges for Services $0.28 $0.29 $0.30 $0.30 $0.31
Developer Fees
Tax Revenues 2 3.52 3.65 3.76 3.90 4.01
Licenses and Permits
Intergovernmental 0.02 0.02 0.02 0.02 0.03
Fines & Forfeitures 0.28 0.29 0.30 0.31 0.31
Income from Prop & Investments 0.86 0.88 0.90 0.92 0.94
Interdepartmental 0.11 0.11 0.11 0.12 0.12
Other Revenues 0.28 0.29 0.30 0.30 0.31
TOTAL OFFSETTING REVENUES $5.35 $5.53 $5.69 $5.88 $6.04
* Line or column totals may not tie due to rounding
Table13 Offsetting Revenues -Recycled Water($ millions)
Revenue Item I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Other Charges for Services $0.004 $0.35 $0.36 $0.38 $0.39
Developer Fees 0.25
Intergovernmental 0.15 4.54 4.68 4.82 4.97
Fines & Forfeitures 0.01
Income from Prop & Investments 0.03 0.03 0.03 0.03
Interdepartmental 0.09 0.35 0.35 0.36 0.37
Other Revenues 0.00 1.04 1.07 1.09 1.12
TOTAL OFFSETTING REVENUES $0.51 $6.31 $6.49 $6.68 $6.88
* Line or column totals may not tie due to rounding
Table 14 and Table 15 illustrate operating expenditures over the five year projection period for potable
·and recycled water, respectively. Potable operating expenses are projected to increase approximately
$6.3 million by FYE 2024. The increases are largely due to the rise purchased water costs. The Transfers
to Capital Reserve line ("Replacement Funding"), and the annual depreciation amount are transferred to
the capital reserve. Recycled expenses are going up approximately $0.2 million over the projection
period.
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Table 14 Expenditures -Potable Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Personnel $3.73 $3.91 $4.08 $4.24 $4.39
Maintenance & Equipment 11.94 10.75 11.22 11.56 11.90
Water Purchases (SDCWA and Desai) 24.04 25.77 27.12 28.47 29.89
Capital Outlay 0.37 0.38 0.39 0.40 0.41
Debt Service 0.00 0.00 0.00 0.00 0.00
Depreciation Funding 4.10 4.19 4.24 4.29 4.34
Transfer to Capital Fund 2.00 2.05 2.10 2.15 1.50
TOTAL OPERATING EXPENDITURES $46.18 $47.05 $49.16 $51.12 $52.44
* Line or column totols may not tie due to rounding
Table 15 Expenditures -Recycled Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Personnel $1.56 $1.64 $1.71 $1.78 $1.84
Maintenance & Equipment 2.62 2.68 2.76 2.76 2.84
Water Purchases 2.20 1.72 1.78 1.83 1.88
Capital Outlay 0.05 0.05 0.05 0.05 0.06
Debt Service 2.74 2.74 2.77 2.77 2.77
Depreciation Funding 0.00 0.00 0.00 0.00 0.00
Transfer to Capital Fund 0.00 0.00 0.00 0.00 0.00
TOTAL OPERATING EXPENDITURES $9.16 $8.83 $9.06 $9.19 $9.39
"Line or column totals may not tie due to rounding
3.3 Recommended Revenue Requirements
Rate revenue increases will be necessary in order to meet the District's projected operating needs. The
increases for potable water are primarily driven by increasing purchased water cost from SDCWA and the
delivery of desalinated water pursuant to the UMAPC.
The recommended increases will enable the District to continue to fully fund its capital program and
meet its debt service requirements. Furthermore, by initiating annual increases, the District can mitigate
larger increases in the future and avoid the need for substantial debt issuances.
3.3.1 Cash Flow Sufficiency Test
The cash flow sufficiency test evaluates revenues received by the District to see that they are adequately
covering both operating and non-operating expenses. Table 16 and Table 17 provide the cash flow
sufficiency tests for potable and recycled water, respectively.
The cost of service analysis includes proposed potable water rate increases of 1 percent in FYE 2020 and
2 percent per year thereafter. Based on t he projections, no recycled water rate increases for the five year
forecast are necessary. Though the financial analysis included projection for a five-year period, the
District only intends to adopt rate updated for FY 2019/20 and FY 2020/21.
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The proposed potable water rate revenue increases for FYE 2020 will be implemented by a full cost of
service adjustment, and rate adjustments will vary by customer class and rate component. For FYE 2021,
the percentage rate revenue increase is recommended to be applied to the FYE 2020 cost of service-
based rates.
Total operating expenses included in the cash flow sufficiency test include depreciation. The District
currently transfers an amount equal to annual depreciation as well as an additional capital funding
transfer from the operating reserves to the capital reserves each year. Overtime, the District has been
very proactive in annually contributing to the replacement of its system. Based on the current fund
balances, the District can mitigate the necessary rate adjustments by reducing its annual capital funding
transfers to the capital fund over the next five years. This will allow the District to meet the operating
reserve policy target of 40 percent of operations costs.
Table 16 Cash Flow Sufficiency Test-Potable Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Pre-Rate Increase
Rate Revenues without Increases $40.21 $40.56 $40.83 $40.92 $40.99
Revenue from Previous Years' Increases 0.00 0.41 1.23 2.08 2.94
Offsetting Revenues 5.35 5.53 5.69 5.88 6.04
Operating Revenues $45.56 $46.50 $47.75 $48.87 $49.97
Less Operating Expenditures ($46.18) ($47.05) ($49.16) ($51.12) ($52.44)
Cash Flow Surplus/(Deficit) ($0.62) ($0.55) ($1.41) ($2.24) ($2.47)
Rate Revenue Increase 1.0% 2.0% 2.0% 2.0% 2.0%
Post-Rat e Increase
Revenue from Increase $0.40 $0.82 $0.84 $0.86 $0.88
(Less): Rate Increase Delay1 (0.20) (0.41) (0.42) (0.43) (0.44)
Cash Flow Surplus/(Deficit) ($0.42) ($0.14) ($0.99) ($1.81) ($2.03)
Operating Fund Reserve
Beginning Operating Fund Balance $26.40 $25.98 $25.84 $24.85 $23.03
Cash Flow (0.42) (0.14) (0.99) (1.81) (2.03)
Other Transfers 0.00 0.00 0.00 0.00 0.00
ENDING OPERATING FUND BALANCE $25.98 $25.84 $24.85 $23.03 $21.00
Percent of Operations 56% 55% 51% 45% 40%
* Line or column totals may not tie due to rounding
Based on the study projections, no rate revenue increases will be needed for recycled water. Costs are
expected to increase only slightly over the study period and capital reserves are sufficient to fund the
planned CIP investments.
Additional detail of the revenue requirement analysis is included for reference in Appendix E.
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Table 17 Cash Flow Sufficiency Test-Recycled Water($ millions)
I FYE 2020 I FYE 2021 I FYE 2022 I FYE 2023 I FYE 2024
Pre-Rate Increase
Rate Revenues without Increases $7.79 $7.86 $7.91 $7.93 $7.94
Revenue from Previous Years' Increases 0.00 0.00 0.00 0.00 0.00
Offsetting Revenues 0.51 0.37 0.38 0.39 0.40
Operating Revenues $8.30 $8.23 $8.29 $8.32 $8.34
Less Operating Expenditures ($9.16) ($8.83) ($9.06) ($9.19). ($9.39)
Cash Flow Surplus/(Deficit) ($0.86) ($0.60) ($0.77) ($0.88) ($1.05)
Rate Increase 0.0% 0.0% 0.0% 0.0% 0.0%
Post-Rate Increase
Revenue from Increase $0.00 $0.00 $0.00 $0.00 $0.00
(Less): Rate Increase Delayl 0.00 0.00 0.00 0.00 0.00
Cash Flow Surplus/(Deficit) ($0.86) ($0.60) ($0.77) ($0.88) ($1.05)
Beginning Operating Fund Balance $9.52 $8.66 $8.06 $7.29 $6.41
Cash Flow (0.86) (0.60) (0.77) (0.88) (1.05)
Other Transfers 0.00 0.00 0.00 0.00 0.00
ENDING OPERATING FUND BALANCE $8.66 $8.06 $7.29 $6.41 $5.36
Percent of Operations 95% 91% 80% 70% 57%
* Line or column totals may not tie due to rounding
3.3.2 Debt Coverage Test
The District's annual debt obligat ion for FYE 2020 through FYE 2024 is approximately $2.7 million. The
District's current and projected debt obligations are State Revolving Fund loans for the recycled water
system. This is stated as a debt service coverage ratio (DSCR) of l.lOx. However, the District has a best
practices target of maintaining a bond coverage ratio of 125 percent, or 1.25x, of the annual debt service
obligation. The potable water system has no outstanding debt service obligations. Based on the
proposed rate revenue increases, the District will meet its debt coverage obligation for the entire five
year projections. Table 18 presents the calculation of the DSCR.
Table 18 Debt Service Coverage Test-Recycled Water
Budget Item I FYE 2020 I FYE 2021 FYE 2022 FYE 2023 FYE 2024
Recycled Revenues for Coverage $16.35 $16.20 $16.32 $16.37 $16.41 Test
Recycled Expenses for Coverage (6.43) (6.09) (6.29) (6.42) (6.62) Test
Net Revenue Available for $9.93 $10.11 $10.02 $9.94 $9.79 Coverage Test
Recycled Water Debt Service $2.74 $2.74 $2.77 $2.77 $2.77
Coverage (1.25x) 0.68 0.68 0.69 0.69 0.69
DSCR 2.90x 2.96x 2.89x 2.87x 2.82 x
* Line or column totals may not tie due to rounding
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Section 4 -Cost of Service Analysis
With the District's revenue requirements outlined, including necessary revenue increases, the next step is
to link each cost item with a specific service to the system that it supports. This is commonly referred to
as the cost of service analysis, or the functional cost allocation, because it connects each cost with a
functional category or purpose that it funds. The purpose of a cost of service analysis is to provide a
rational basis for distributing the full costs of the District's service to each customer class in proportion to
the demands they place on the system. For instance, expenses related to the billing system are allocated
under the umbrella of the customer service function, while baseline water purchases go to support the
base demand ful')ction.
The purpose of this cost of service study is to develop water rates that proportionally recover the full cost
for providing potable and recycled water services for the District's customers. The approach and analysis
presented withi n t his report reasonably achieve this objective and are projected to recover the District's
annual revenue needs absent substantial and unforeseen changes in the costs or customer water
demands. The cost of service process is comprised of four steps.
1. Revenue Requirement.
2. Functional Allocation.
3. Customer Class Allocation.
4. Rate Design.
The Functional Allocation builds on the Revenue Requirement analysis that was described in the previous
chapter by allocating each budget item to a specific functional category. The general functiona l
categories include customer, service, supply, base, peak, and fire. Allocating the budget to t hese
functional categories is a process of grouping expenditures into common cost areas so that those costs
can then be distributed to each customer based on the services provided. For example, customer costs
include utility billing expenditures, which are then charged to each customer based on the number of bills
received each year. The purpose of this process is to allocate costs to the distinct customer classes based
on each class's unique number of accounts, size of the meters, and demand characteristics and translate
each cost into a specific rate component.
4.1 Functional Allocation Analysis
In order to proportionally recover costs from the District's customers, the budget was evaluated by line
item, allocating each expenditure to a functional cost category. While a similar methodology was used
for the potable and recycled water analyses, there are some differences between the two funds and,
consequently, how costs are allocated. A detailed analysis of the functional allocation is presented in
Appendix F.
The AWWA Ml Manual outlines the two most widely used methods for allocation costs, wh ich are the
base-extra capacity method and the commodity demand methodology. Both methods recognize that
the cost of service customer depends not only on the total volume of water used, but also on the rate of
use or peak-demand requirements. The cost of service allocation completed in this study is established
on the base-extra capacity method. Carollo developed a detailed cost allocation that serves as the basis
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for the proposed rate adjustments. This analysis yields an appropriate method for allocating costs, which
could be sustained unless substantial changes in cost drivers or customer consumption patterns occur.
4.1.l Functional Cost Categories -Potable Water
In using the base-extra capacity method, costs are typically separated into five broad cost components.
1. Customer.
2. Base.
3. Extra capacity.
4. Recycled Water.
5. Fire.
The cost of service analysis has been completed using the five-year average of forecasted costs for FYE
2016 through 2020.
As noted in the AWWA Ml Manual, in detailed rate studies, some of these elements may be broken down
further into two or more subcomponents. Based on the District's expenditures and system
characteristics, the Customer component was separated into two subcomponents to better identify and
allocate costs that may vary based on the size of the meter rather than per account.
1. Customer (based on accounts).
2. Service (based on MEUs).
Similarly, the extra capacity functional allocation was split into two subcomponents based on calculated
peaking factors to better distinguish that all demand (and peaking) is not equal.
1. Max Day (based on maximum day demand).
2. Max Hour (based on maximum hour demand).
In addit ion, two categories were added to the functional allocation in order to recover costs from
imported water supplies; SDCWA and Desai.
Given the breakdown of the broad cost components as detailed above, the District's costs were allocated
among the following eight categories.
Customer. Customer costs are fixed expenditures that relate to the District's support activities, which
include utility billing, customer service, and administrative support. These expenditures are common to
all customers and uniformly recovered from each customer through the monthly delivery charge.
Service. Service costs are annual expenditures that the District will incur each year regardless of the
quantity of water sold. These costs include salaries, benefits, and system operational costs, excluding
water supply costs and conservation programs. The service costs also include fixed pass-through costs
from the SDCWA. Service costs are reasonably un iform across the different customer classes and are
collected based on each customer's meter size, which determines the instantaneous quantity of water
that can be drawn from the District's system and approximates that customer's potential demand on the
system.
lase-: Costs allocated to base are operating and capital costs incurred by the water system to provide a
basic level of service to each customer. These costs are tied to the amount of base (annualized minimum
month) demand.
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Max Day: Costs allocated to max day are operating and capital costs incurred by the water system to
provide a maximum day level of service to each customer. These costs are tied to the amount of
maximum day demand, as calculated in Section 4.1.3 .
Mu Hour. Costs allocated to max hour are operating and capital costs incurred by the water system to
provide a maximum day level of service to each customer. These costs are tied to the amount of
maximum day demand, as calculated in Section 4.1.3 .
SIJCW/l-. Costs associated with the lowest cost source of water supply, which is the non-desalinated water
purchased from SDCWA. These costs vary by the amount consumed.
DesaJ. Costs associated with the purchase of desalinated water, which is the higher cost source of supply.
Fite: Costs allocated to fire are operating and capital costs incurred to provide public and private fire
service. Fire costs are allocated to private fire lines as a percent of total capacity of public fire hydrants
and private fire service lines or meters, which restrict the flow of that fire line.
4.1.2 Functional Allocation Factors
In order to perform the functional allocation, the cost of service analysis combines information from the
revenue requirement analysis, the District's detailed operating budget, historical billing data, and
additional operational and system information provided by Carlsbad. The allocation to each functional
category was calculated based on the detailed budget and cost information, and then applied to the
calculated rate revenue requirements. The allocation factors used in the functional allocation are outlined
in Table 19 for potable water.
In the functional allocation, each line item in the District's budget is assigned an allocation factor
according to the functional categories it serves. The budgeted value for that line item is then allocated to
the functional categories based on the percentages associated with the allocation classification.
Table 19 Functional Allocation -Potable Water
Allocation Factor I Customer I Service I Base I ~:; I ~oa:r I Fire I SDCWA I Desai
Customer Only 100%
Service Only 100%
Customer/Service 50% 50%
Base Only 100%
Max Day 100%
• Max Hour 100%
Base/Max Day 63% 38%
Base/Max Day/Max 34% 21% 45% Hour
Max Day/Max Hour 50% 50%
Capacity/Demand 49% 17% 10% 22% 1.2%
SDCWAOnly 100%
Desai Only 100%
* Line or column totals may not tie due to rounding
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4.1.3 Functional Jlllocation Peak Factor Analysis
Water agencies must maintain a fair and equitable methodology for recovering costs both across and
within customer classes. To accomplish this, peak factors are a standard industry practice for identifying
relative demands on the utility system. The following peak factor calculations exhibit how MVWD's
customers place demands on the system, and provide a basis for recovering costs.
With the District's costs outlined from its budget, water production and distribution costs, as well as
other costs to be recovered through commodity rates, must be assigned to either the Base, Max Day,
Max Hour, or Recycled categories. The first step allocating variable costs among these categories is the
development of system demand factors. Table 20 illustrates total system demand factors for the District
in million gallons per day (MGD) based on FYE 2018 usage data. Average day demand is calculated based
on total usage divided by 365 days. The max day demand/max month factor and the max hour
demand/average day demand factors were provided by the most recent update of the CMWD Water
Master Plan.
Table20 System Demand Factors
System Demand Factor I Million Gallons per Day (MGD)
Average Day Demand (ADD) 13.12
Max Day Demand (MDD) 20.99
Max Hour Demand (MHD) 38.04
MDD / Max Month 1.60
MDD / ADD ("Max Day Coincidental Factor") 1.60
MHD / ADD ("Max Hour Coincidental Factor") 2.90
The resulting Max Day and Max Hour Coincidental Factors that are calculated from the system demand
factors are used to determine the extra capacity allocations, which allocate base, max day, and max hour
costs within the functional allocation analysis, as presented in Section 4.1.2. To develop the "Base/ Max
Day" functional allocation factor, the Max Day Coincidental Factor is divided between base and max day,
where base represents 1.00 of the ratio, and max day represents the remainder. The resulting "Base/
Max Day" allocation factor is 63 percent to base and 38 percent to max day. The same methodology is
applied to the "Base/ Max Day/ Max Hour" functional allocation factor using the Max Hour Coincidental
Factor, which results in 34 percent to base, 21 percent to max day, and 45 percent to max hour. The extra
capacity allocations are presented in Table 21 below.
Table 21 Extra Capacity Allocations
Factor I Ratio I Extra Capacity Allocation(%)
MDD / ADD ("Max Day Coincidental Factor") 1.60 100%
Base 1.00 62.5%
Max Day 0.60 37.5%
. MHD / ADD ("Max Hour Coincidental Factor") 2.90 100%
Base 1.00 34.5%
Max Day 0.60 20.7%
Max Hour 1.30 44.8%
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4.1.4 Functional Allocation Results
Once each cost is allocated, a combined allocation of the District's expenses is used as the basis for
allocating rate revenue requirements to each functional category and subsequently to each customer
class. The functional allocation also defines the spl it between costs recovered through fixed rate
components and those recovered through variable rate components.
4.1.4.1 POTABLE WATER FUNCTIONAL ALLOCATION RESULTS
The results of the potable waterfunctional allocation analysis are shown in Table 22. The majority of the
system's costs are related to variable supply costs for imported water from SDCWA. Combined with
Desalination costs, these source costs make up over 53 percent of the District's potable rate revenue
requirements.
The Service, Customer, and Fire cost components are collected through fixed rate components and total
approximately 31 percent of the District's potable costs. These costs are recovered through Carlsbad's
monthly delivery fee. The District's water usage fees recover the remaining 69 percent of costs, which are
allocated to the Base, Max Day, Max Hour, SDCWA, and Desai components.
Table 22 Functional Allocation Results Summary-Potable Water
All . 8 . I Revenue Requirement I Percent of Total Functional ocat1on as1s ($ .11. ) All t· m1 ions oca 10n
Customer $2.57 6.3%
Service 9.66 23.8%
Base 3.77 9.3%
Max Day 2.07 5.1%
Max Hour 1.21 3.0%
Fire 0.19 0.5%
SDCWA 15.01 37.0%
Desai 6.13 15.1%
TOTAL $40.61 100.0%
* Line or column totals may not tie due to rounding
4.2 Customer Class Allocation
The final step in the cost of service analysis is the allocation of costs to each customer class. This step
utilizes the results of the functional allocation and service units to proportionally allocate costs based on
the level of service provided to each customer (rate) class. Service units are metrics for each customer
class such as the number of accounts, number of meters by size, and usage characteristics that define the
level of service provided to each class. Each functional cost component is divided amongst the customer
classes in proportion to each classes' share of the service units used to allocate the respective functional
component.
Table 23 presents the total service units, otherwise known as the customer class characteristics, of each
customer class. These totals are used to proportionally allocate the functional cost components between
each customer class. The values presented in Table 23 are the projected values for FYE 2020.
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Table 23 Customer Class Service Units
S . U . I Single I Multi-I C . I I A . I I I 1 . • I F' I T I erv1ce nit Family Family ommema gncu tura mgat1on ire ota
Number of
Accounts 24,716 1,142 1,706 22 838 782 29,207
(Customer)
Number of ME Us 27,845 5,019 8,390 272 4,520 40,365 86,412 (Service)
Annual Water 3,320,201 703,605 1,249,080 86,688 829,673 6,189,248 Usage (ccf)
Max Month (ccf) 347,708 68,691 128,900 12,187 104,210 661,696
Max Day (ccf) 32,547 4,136 9,314 629 10,757 57,384
Max Hour (ccf) 58,992 7,497 16,882 1,140 19,497 104,008
SDCWA (ccf) 2,755,027 647,705 1,114,040 65,689 517,786 5,100,248
Desai (ccf) 565,174 55,900 135,039 20,999 311,887 1,089,000
* Line or column totals may not tie due to rounding
4.2.1 Potable Volumetric Cost Allocation
Costs allocated to the variable functional categories (Base, Max Day, Max Hour, SDCWA, and Desai) are
allocated based on the amount of demand in each of those categories for each class. This directly ties the
incremental cost of water to each class's consumption and to volumetric rate tiers (where applicable).
Every unit of water has both an element of base, max day, max hour, SDCWA, and Desai costs. The
elements are allocated across the total projected FYE 2020 demand and are summed to determine the
total cost allocated to each class.
4.2.2 Supply Allocation
The available water supplies are allocated based on unit costs. Non-desalinated water from SDCWA, the
lower'cost source, is used to fulfi ll all base demand requirements. Desalinated water, the more expensive
source, is used to fulfill peak demand requirements. The available supply from each priority is the basis to
allocate costs to each customer class and then usage to each tier (where applicable).
This approach recovers costs associated with the higher cost source of supply through the upper tiers. In
practice, this means that the costs of desalinated water are recovered from each class based on each
cla ss's incremental summer demands.
Allocation proportions are based on the projected consumption from each customer class for FYE 2020.
The allocation of available supply to each customer class was performed using the two step process
described below.
Step l: Allocate SDCWA water to all classes based on annualized three-month minimum usage.
The annualized minimum demand is assumed to represent the basic minimum level of usage for
each customer class. The remaining SDCWA water is available to be allocated to all customers in
step two of the supply allocation. Table 24 shows the calculations for Step 1 of the supply
allocation.
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Step 2: Allocate remaining SDCWA and Desai demand to all classes based on annualized average
usage. The remaining supply is allocated across classes based on proportional, annualized,
average monthly use. This represents each class's incremental use above their basic minimum
needs. Table 25 shows the calculations for Step 2 of the supply allocation.
Table 24 Supply Allocation -Step 1
I SDCWA I Desai I Total
Total amount to be allocated 5,100,248 1,089,000 6,189,248 ccf
I Annualized Three-I I I I Customer Class Month Min. (ccf) % of Usage SDCWA Desai Total
Single Family 2,611,096 54.1% 2,611,096 2,611,096
Multi-Family 633,469 13.1% 633,469 633,469
Commercial 1,079,650 22.4% 1,079,650 1,079,650
Agricultural 60,342 1.3% 60,342 60,342
Irrigation 438,359 9.1% 438,359 438,359
TOTAL 4,822,916 100% 4,822,916 4,822,916
* Line or column totals may not tie due to rounding
Table 25 Supply Allocation -Step 2
I SDCWA I Desai I Total
Amount remaining to be allocated 277,332 1,089,000 1,366,332 ccf
C I Annualized I Less I I o/c f I I I u~~::er Avg. Month previously Remaining u:ao e SDCWA Desai Total
(ccf) allocated g
Single Family 3,320,201 (2,611,096) 709,105 51.9% 143,931 565,174 709,105
Multi-Family 703,605 (633,469) 70,136 5.1% 14,236 55,900 70,136
Commercial 1,249,080 (1,079,650) 169,430 12.4% 34,390 135,039 169,430
Agricultural 86,688 (60,342) 26,347 1.9% 5,348 20,999 26,347
Irrigation 829,673 (438,359) 391,314 28.6% 79,427 311,887 391,314
TOTAL 6,189,248 (4,822,916) 1,366,332 100% 277,332 1,089,000 1,366,332
* Line or column totals may not tie due to rounding
The allocations to SDCWA and Desai from steps 1 and 2 are summed to determine the total supplies
allocated to each customer class. The costs allocated to SDCWA and Desai are t hen split between each
customer class proportionally based on their allocation of water from each supply. Table 26 shows the
total demand (ccf) allocated to each supply as a result of the calculations in Table 24 and Table 25.
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Table 26 Supply Allocation Summary
Customer Class [ SDCWA [ Desai [ Total
Single Family 2,755,027 565,174 3,320,201
Multi-Family 647,705 55,900 703,605
Commercial 1,114,040 135,039 1,249,080
Agricultural 65,689 20,999 86,688
Irrigation 517,786 311,887 829,673
TOTAL 5,100,248 1,089,000 6,189,248
* Line or column totals may not tie due to rounding
4.2.3 Fixed Cost Allocation
Fixed costs are allocated based on each class's share of accounts and MEUs. Customer costs are allocated
based on the number of accounts and Service costs are allocated based on the number of ME Us. All costs
allocated to the Fire functional category are allocated directly to fire customers. Table 27 summarizes the
service units and the percentage allocations used to allocate fixed costs to each customer class.
Table 27 Fixed Cost Customer Allocation Factors
C Cl I # A I Percent I # MEU I Percent I Private Fire I Fire Percent ustomer ass ccounts . s . . Allocation Allocation Accounts Allocation
Single Family 24,716 87% 27,845 60%
Multi-Family 1,142 4% 5,019 11%
Commercial 1,706 6% 8,390 18%
Agricultural 22 0.1% 272· 1%
Irrigation 838 3% 4,520 10%
Fire 782 100%
TOTAL 29,207 100% 86,412 100% 782 100%
* Line or column totals may not tie due to rounding
4.2.4 Potable Water Customer Allocation Results
Table 28 summarizes the total revenue requirements allocated to each potable water customer class for
FYE 2020. These allocated costs are subsequently used to determine the fixed delivery charges and
volumetric rates for each customer class. Additional detail of the customer allocation analysis is included
for reference in Appendix G.
Table 28 Potable Water Customer Allocation Summary, FYE 2020 ($ millions)
(Functional I Service Unit I SFR I MFR I Commercial I Agricultural I Irrigation I Fire omponent .. , .
Customer Accounts $2.23 $0.10 $0.15 $0.00 $0.08 $-
Service MEUs 2.02 0.43 0.76 0.05 0.50
Base Annual 1.17 0.15 0.34 0.02 0.39 Usage (ccf)
Max Day Max Day 0.69 0.09 0.20 0.01 0.23 Usage (ccf)
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;~:~~~~~t I Service Unit I SFR I MFR I Commercial I Agricultural I Irrigation I Fire
Max Hour Max Hour 8.11 1.91 3.28 0.19 1.52 Usage (ccf)
SDCWA SDCWA 5.84 1.05 1.76 0.06 0.95 Allocation
Desai Desai 3.18 0.31 0.76 0.12 1.76 Allocation
Fire MEUs 0.19
TOTAL $23.25 $4.04 $7.25 $0.46 $5.42 $0.19
* Line or column totals may not tie due to rounding
Section 5 -Rate Design Analysis
The rate design analysis links the cost allocated to each customer class with the projected demand for
each class. The resulting rates from this analysis must fully recover costs. Additionally, the analysis
should demonstrate that each customer class is paying their fair and proportionate share of system costs.
5.1 Rate Structure Objectives and Goals
With costs equitably allocated to each customer class, as outlined in Section 0, the District has some
flexibility in designing a rate structure that meets its policy and fiscal objectives. In determining the
appropriate rates and rate structures, the District considered various rate design alternatives and the
resulting impacts to both the District and its customers. Carollo utilized multiple criteria in judging each
rate structure.
1. Clear and understandable.
2. Easily administered.
3. Follows cost of service principles.
4. Provides revenue stability.
5. Provides affordability.
6. Complies with legal and regulatory requirements.
Given the numerous and competing elements of rate design, selection of an appropriate rate structure is
complex. There is no single structure that meets all objectives equally. The rate recommendations
presented within this report proportionally recover costs from system users, helps to stabilize annual rate
revenues, and are easy to both administer and understand by the District's customers as they provide
consistency with the existing rate structure. The following section summarize the calculations and
methodologies used to developed the proposed rates, additional detail of the rate design analysis is
included for reference in Appendix H.
5.2 Proposed Water Delivery Fees
Delivery charges are intended to recover the District's fixed operating costs. The proposed delivery
charges are a combination of the Customer and Service functional components. Separate delivery
charges were developed for recycled customers to reflect the specific costs of the recycled water system.
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To determine the delivery charge, the meter unit cost is multiplied by the meter capacity ratios
previously developed by the District to calculate the meter Service cost. These ratios are based on ratios
identified in the A WWA M6 Manual 'Water Meters -Selection, Installation, Testing, and Maintenance' and
represent the types of meters used by the District. The ratios are calculated using the average of
maximum flow for meters of each size.
The service cost is then added to the customer cost to calculate the cost based fixed charges. Table 29
(potable) and Table 30 (recycled) present the results of this calculation for FYE 2020.
The proposed revenue adjustments, as a percentage, do not equal or necessarily correlate to an
equivalent percentage increase to rates or monthly bills. The results of the cost of service analysis and
rate redesign will affect users differently based on their meter size and water consumptions habits.
Table 29 Proposed Monthly Water Delivery Fees-Potable Water
M 5. I Meter Equivalent I Customer I Service I T I F. d Ch eter 1ze . ota 1xe arge Ratio Component Component
5/8" 1.00 $7.52 $17.49 $25.02
3/4" 1.50 7.52 26.23 33.76
1" 2.50 7.52 43.72 51.25
1.5" 5.00 7.52 87.45 94.98
2" 8.00 7.52 139.92 147.45
21/2" 11.50 7.52 201.13 208.67
3" 15.00 7.52 262.35 269.88
4" 25.00 7.52 437.25 444.79
6" 50.00 7.52 874.51 882.05
8" 80.00 7.52 1,399.23 1,406.76
10" 115.00 7.52 2,011.39 2,018.92
* Line or column totals may not tie due to rounding
Table 30 Proposed Monthly Water Delivery Fees-Recycled Water
Meter Size I Meter Equivalent Ratio I Total Fixed Charge
5/8" 1.00 $23.69
3/4" 1.50 $32.69
1" 2.50 $50.70
1.5" 5.00 $95.73
2" 8.00 $149.75
21/2" 11.50 $212.84
3" 15.00 $275.90
4" 25.00 $455.93
6" so.co $906.18
8" 80.00 $1,446.47
10" 115.00 $2,076.82
* Line or column totals may not tie due to rounding
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Table 31 summarizes the proposed fixed charges for customers with fire line service. Currently the
District does not have a separate charge for private fire line customers. The service connection size is the
basis of the charge for customers that have fire line service. The size of the connection determines the
flow capacity, or quantity of water that can be drawn from the District's system in the event of a fire.
Service connection size can be measured either by consumption meter size or by service line size. In
cases where an installed meter restricts the capacity of the connection and measures total water
consumption, the charges will be based on the meter size. For fire lines that have a meter that is in place
only to inform the District when water is drawn through the pipe and does not restrict water flows, the
charge will be based on the service line size. Setting charges based on service connection size ensures
legal compliance and ratepayer equity.
Table 31 Proposed Monthly Water Delivery Fees -Fire
Meter Size I Meter Equivalent Ratio I Total Fixed Charge
5/8" 1.00 $7.77
3/4" 1.50 7.89
1" 2.50 8.14
1.5" 5.00 8.74
2" 8.00 9.48
21/2" 11.50 10.33
3" 15.00 11.18
4" 25.00 13.62
6" 50.00 19.71
8" 80.00 27.01
10" 115.00 35.54
12" 200.00 56.25
5.3 Proposed Water Usage Fees
The District's tiered customers include single-family and multi-family residential classes, referred to
collectively as residential customers. All other customer classes are billed a uniform rate, regardless 9f
usage. The volumetric rate for recycled customers is calculated based on the recycled water system's
unique costs.
5.3.l Residential Rates
The current rates for all residential customers utilize a three-tiered inclining block structure. The usage
allotments for each tier are constant throughout the course of the year. Tier allotments are based on the
water needs for each customer and on the actual usage patterns observed in the customer billing data.
5.3.1.1 SFR RATE DESIGN
The single-family residential tiered rates provide a strong relationship between the District's cost of
providing the water service and the customer's payment for that service. The tiered rates build from the
functional allocation presented in O and are structured to recover Base, Max Day, and Max Hour costs,
which are costs related to internal expenditures, as well as SDCWA and Desai water purchase costs.
Carollo does not propose any changes to the current SFR rate t ier break structure during the five-year
rate setting period.
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The development of the residential tiers is a two-step process. First, Base costs are allocated to ~ach tier
equally. Max Day and Max Hour costs are allocated to each tier based on the tier peak factor calculated
using Equation 1. For each tier the peak factor is multiplied by the projected FYE 2020 demand and
divided by the sum product of demand and both factors to calculate the percent of max day and max
hour to be allocated to each tier, as shown in Table 32.
Equation 1 Tier Peak Factor Formula
Table 32
Max Month Tier Usage (cc!) Tier Peak Factor=-------------Average Month Tier Usage (eel)
SFR Rate Design -Base, Max Day, Max Hour
Tier I Peak Factor I FYE 2020 Demand (ccf) I Base j Max Day I Max Hour
Tierl 1.06 2,106,380 63.5% 55.2% 55.2%
Tier2 1.32 715,224 21.5% 23.5% 23.5%
Tier3 1.73 498,597 15.0% 21.3% 21.3%
TOTAL 3,320,201 100% 100% 100%
* Line or column totals may not tie due to rounding
Next, SDCWA and Desai cost components are allocated between the t hree tiers. Using t he result of the
supply allocation (see Table 26), the forecasted FYE 2020 demand is allocated between the two supplies
as summarized in Table 33. The resulting percent allocation split between the tiers is used to allocate the
SDCWA and Desai costs between Tiers 1, 2, and 3.
Table 33 SFR Rate Design -Supply Costs
Tier I FYE 2020 Demand (ccf) I SDCWA (ccf) I Desai (ccf) I SDCWA I Desai
Tierl 2,106,380 2,106,380 76.5%
Tier2 715,224 648,647 66,577 23.5% 11.8%
Tier3 498,597 498,597 88.2%
TOTAL 3,320,201 2,755,027 565,174 100% 100%
* Line or column totals may not tie due to rounding
Using the percent allocations calculated in Table 32 and Table 33, the total revenue requirement for each
functional component is divided between Tier 1 and 2. The resulting proposed FYE 2020 SFR water usage
fees are presented in Table 34.
Table 34 SFR Rate Design Summary, FYE 2020
Functional R . Tier 1 Tier 2 Tier 3
I
FYE 2020 Revenue I . I I . equirement
Component ($ millions) ($/ccf) ($/ccf) ($/ccf)
Base $2.02 $0.61 $0.61 $0.61
Max Day 1.17 0.31 0.18 a.so
Max Hour 0.69 0.18 0.23 0.29
SDCWA 8.11 2.94 2.67
Desai 3.18 0.52 5.63
TOTAL $15.17 million $4.04/ ccf $4.42 / ccf $7.04 / ccf
* Line or column totals may not tie due to rounding
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5.3.1.2 MFR RATE DESIGN
Carollo proposes that the current tiers for multi-family residential customers be reduced from three to
two tiers. This is based on the observed historical demand profile of multi-family residential customers
and the goal of the District to encourage conservation. Based on FYE 2018 usage data, 78 percent of MFR
usage was Tier 1, 17 percent was Tier 2, and only 5 percent was Tier 3. Given the low amount of usage in
Tier 3, Carollo proposes that the District eliminate Tier 3 in order to better match their MFR customer
usage profile. A summary of the proposed changes to the multi-family residential tiers is presented in
Table 35.
The proposed monthly MFR Tier 1 allotment per dwelling unit remains at 5 ccf. This allotment is in
alignment with the monthly SDCWA allotment per account. Additionally, 5 ccf t ies closely to average
minimum month use per account, and to the indoor use of a four person household using of-55 gallons
per capita, per day. Any usage above 5 ccf will be charged the MFR Tier 2 rate.
Table 35 Proposed Multi-Family Residential Tier Allotments
Customer Class I Tier I Current Allotment I Proposed Allotment
Multi-Family Residential
{per DU)
* Line or column totals may not tie due to rounding
Tierl
Tier2
Tier3
5 ccf 5 ccf
5 ccf > Sccf
> 10 ccf NIA
Similar to single family residential, multi-family residential tiered rates provide a strong relationship
between the District's cost of providing the water service and the customer's payment for that service.
The tiered rates build from the functional allocation presented in Section 4 and are structured to recover
Base, Max Day, Max Hour, SDCWA, and Desai water purchase costs.
The process by which these costs are allocated between MFR Tier 1 and 2 are similar to those presented
in Section 5.3.1.1 Table 36 presents the allocation of base, max day, and max hour costs to each MFR
tier. Table 37 presents the process of allocating each supply cost component to the tiers. And finally,
Table 38 provides a summary of the FYE 2020 MFR rate design.
Table 36 MFR Rate Design -Base, Max Day, Max Hour
Tier I Peak Factor J FYE 2020 Demand (ccf) J Base I Max Day J Max Hour
Tierl 1.04 547,586 77.8% 72.2% 72.2%
Tier2 1.41 156,019 22.2% 27.8% 27.8%
TOTAL 703,605 100% 100% 100%
* Line or column totals may not tie due to rounding
Table37 MFR Rate Design -Supply Costs
Tier I FYE 2020 Demand (ccf) I SDCWA (ccf) I Desai (ccf) I SDCWA I Desai
Tierl 547,586 547,586 84.5%
Tier2 156,019 100,119 55,900 15.5% 100%
TOTAL 703,605 647,705 55,900 100% 100%
* Line or column totals may not tie due ta rounding
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Table 38 MFR Rate Design Summary, FYE 2020
Functional I FYE 2020 Revenue I Tier 1 I Tier 2
Component Requirement($ millions) ($/ccf) ($/ccf)
Base $0.43 $0.61 $0.61
Max Day 0.15 0.20 0.27
Max Hour 0.09 0.12 0.16
SDCWA 1.91 2.94 1.89
Desai 0.31 2.02
TOTAL $2.89 $3.87 $4.94
* Line or column totals may not tie due to rounding
5.3.2 Commercial, Agricultural, and Irrigation Rate Design
The water usage fee for the remaining customer classes are uniform rates charged regardless of usage.
Similar to the SFR and MFR rate design, the total cost of each functional category is divided by the total
usage for that customer class to produce a rate per ccf. The sum of all functional cat egory unit rate
results in the customer class water usage fee as shown in Table 39.
Table 39 Commercial, Agricultural, and Irrigation Rate Design Summary, FYE 2020
Customer Base Max Max SDCWA D I R Projected Rate
I I I I I I
Total Costs I I . esa to ecover Class ($ millions) Day Hour ($ millions) Demand (ccf) ($/ccf)
Commercial $0.76 $0.34 $0.20 $3.28 0.76 $5.33 1,249,080 $4.27
Agricultural 0.05 0.02 0.01 0.19 0.12 0.40 86,688 $4.62
Irrigation 0.50 0.39 0.23 1.52 1.76 4.40 829,673 $5.31
* Line or column totals may not tie due to rounding
5.4 Proposed Potable Water Rates
Table 40 and Table 41 present the current and adopted potable water rates for the next two years. The
FYE 2020 overall annual rate adjustment of one percent will be implemented as a full cost of service
adjustment and will therefore impact each rate uniquely. FYE 2021 will have a two percent rate revenue
increase applied equally to all rates.
Table 40 Proposed Potable Water Delivery Fees
Meter Size I Current I FYE 2020 I FYE 2021
Increase cos 2%
5/8" $24.72 $25.02 $25.52
3/4" 33.36 33.76 34.44
1" 50.62 51.25 52.28
1.5" 93.79 94.98 96.88
2" 145.58 147.45 150.40
21/2" 206.52 208.67 212.84
3" 266.52 269.88 275.28
4" 439.10 444.79 453.68
6" 870.76 882.05 899.69
8" 1,388.75 1,406.76 1,434.89
10" 1,993.06 2,018.92 2,059.30
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Table 41 Proposed Potable Water Usage Fees
Customer Class I Tier I Current ($/ccf) FYE 2020 I FYE 2021
Increase cos 2%
Tier l $3.94 $4.04 $4.13
Single Family Residential Tier2 4.69 4.42 4.51
Tier3 7.00 7.04 7.18
Tierl $3.87 $3.87 $3.95
Multi-Family Residential Tier2 4.67 4.94 5.04
Tier3 6.97 N/A N/A
Commercial N/A $4.22 $4.27 $4.36
Agricultural N/A $4.53 $4.62 $4.71
Irrigation N/A $5.16 $5.31 $5.41
5.5 Proposed Recycled Water Rates
Table 42 and Table 43 present the current and adopted recycled water rates over the next two years.
From FYE 2020 and FYE 2021, Carollo recommends no annual rate adjustment.
Table 42 Proposed Recycled Water Delivery Fees
Meter Size I Current I FYE 2020 I FYE 2021
Increase
5/8" $23.69 $23.69 $23.69
3/4" 32.69 32.69 32.69
l" 50.70 50.70 50.70
1.5" 95.73 95.73 95.73
2" 149.75 149.75 149.75
21/2" 212.84 212.84 212.84
3" 275.90 275.90 275.90
4" 455.93 455.93 455.93
6" 906.18 906.18 906.18
8" 1,446.47 1,446.47 1,446.47
10" 2,076.82 2,076.82 2,076.82
Table 43 Proposed Recycled Water Usage Fees
Customer Class I Tier I Current ($/ccf) I FYE 2020 I FYE 2021
Increase
Recycled N/A $3.79 $3.79 $3.79
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5.6 Proposed Fire Service Rates
Table 44 presents the current and adopted fire service delivery fee rates over the next two years. The FYE
2020 overall annual rate adjustment of orie percent will be implemented as a full cost of service
adjustment and will t herefore impact each rate uniquely. FYE 2021 will have a two percent rate revenue
increase applied equally to all rates.
Table 44 Proposed Fire Service Delivery Fees
Meter Size I Current I FYE 2020 I FYE 2021
Increase cos 2%
5/8" $7.69 $7.77 $7.93
3/4" 7.82 7.89 8.05
1" 8.06 8.14 8.30
1.5" 8.67 8.74 8.92
2" 9.39 9.48 9.66
21/2" 10.24 10.33 10.53
3" 11.10 11.18 11.40
4" 13.53 13.62 13.89
6" 19.61 19.71 20.10
8" 26.91 27.01 27.55
10" 35.42 35.54 36.25
5.7 Regional Water Rate Comparison
A regional survey of SFR water rates was conducted to compare the District's existing and proposed rates
to those of surrounding agencies. Although not all water systems are alike, such comparisons are
common. Care should be taken in drawing conclusions from such comparisons as all systems face unique
challenges and have developed their rates accordingly. Figure 2 compares the District's existing and
proposed rates for s ingle family residences, assuming an 11 unit water use and a 5/8" residential meter.
The monthly bill includes usage fee, service charges (including the SDCWA infrastructure access charge
when applicable), and miscellaneous charges such as pumping fees and Readiness-to-Serve charge. As
shown in the figure, t he District's average single-family residential monthly bill is currently $68.81. With
the proposed increases, the average bill would increase approximately $2.84 to $71.65. When compared
to the surrounding agencies, the District's proposed rate continues to falls below the average regional
monthly bill. Additionally, this survey does not reflect rate increases currently under review, but not yet
implemented.
32 I OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 95 of 158
Water Cost of Service Study J POTABLE ANO RECYCLED WATER RATE STUDY I CARLSBAD
$140
$120 -----$100 -s68.81 $71.65 _r ----------------$80 :-.
al$60 : : >-: t :i: ~ ., ; §$40
~ .c. ' . •• ,.,
$20 I I $-
-Fixed Charge
-Commodity Charge
--Regional Average
Figure 2 Regional Monthly SFR Water Bill Comparison
FINAL I OCTOBER 2019 I 33
Nov. 19, 2019 Item #16 Page 96 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Appendix A
CU STOMER AND DEMAND FORECASTS
Forecasted customer demands for potable and recycled water are based on actual demand data provided by the District for FYE 2018. Growth
projections for all customer classes follow population data projections developed by the City of Carlsbad. Residential dwelling unit growth was used
for all customer classes except for commercial customers, which is projected based on the average growth of commercial and industrial square feet.
Growth Input o.s" o.7" 1.0" 0.1" o.2" 0.1" o.•" o.•" o.4" 0.3% o.3" o.s" o.5" o.5" 0.4" o.5" o.6"
SMigk! Family
S/8" 2,792;376 2,811,925 2,839,659 2,360,740 2,867,570 2,871,397 2.689,003 2,906,786 2,917,385 2,926,748 2.934,756 2,949,771 2,963,845 2.978,683 2,99],75S 3,00S,829 3,024,612
3/4" 268,758 270,640 273,309 275,338 275.996 276,364 278,(164 279,770 280,790 281,691 282,462 2&3,907 285,262 286,690 287,948 289,303 291,111
I" 227,417 2i9,009 231.,268 232,985 233,541 233,853 235,291 236,735 237,598 238,360 239,013 240,236 241..382 242,590 243,655 244,801 206,331
1.s· 5,728 5,768 5,825 5,868 5,882 5,890 5,926 5,962 5,984 6,003 6,020 6,050 6,079 6,110 6,137 6,165 6,204
2" 2,840 2,860 2,88B 2,909 2,916 2,no 2,938 2,956 2,967 2,976 2.985 l,000 3,014 3,029 3,042 3,DS7 3,076
2.s· ..
4•
6"
8"
10·
Total 3,297,118 3,320,201 3,352.949 3,377,839 3,l8S,90S 3,390,424 3,41~182 3,432,210 3,444,725 3,4SS,n9 3,465,235 3t482,965 3r499c582 3,517,102 3,532,.537 3,5491154 3,571,.334
Growth Input o.s" 0.1% 1.0% 0.1" 0.2K 0.1" o.6% o.6" o.4" o.3" o.3% o.s% o.s" o.s" o.4" o.s% o.6"
MultiF;_,mnv
5/8 49,417 49,763 50,253 50,627 50,747 50,815 51,128 51,441 51.629 51,795 51,936 52,202 S2,451 52,714 52,945 53,194 53,527
3/4 21.930 22,083 22,301 22,467 22,520 22,550 22,689 22,828 22,911 22,98S 23,048 23,166 23,276 23,393 23,496 23,606 23,754
l" 57,9SO 58,355 58.931 59,368 59,510 59,589 59,956 60,324 60,544 60,738 60,904 61,216 61,508 61,816 62,D87 62,379 62,769
1.5• 178,463 179,713 181,485 '182,832 183,269 183,513 1841642 1ss,ns 186,453 187,051 187,563 188,522 189.422 190,370 191,206 192,105 193,300
2· 297,680 299,764 302,721 304.968 305.696 306,104 307,987 309,877 3U,007 312,005 3U,859 314,459 315,960 317,541 318,935, 320,435 322,438
2.5"
3" 44,6B6 44,998 45,442 45,780 45,889 45,950 46,233 46,516 46,686 46,836 46,964 47,204 47,430 47,6fil 47,876 48,101 48,401
4• 41,627 41,918 42,332 42,646 42,74& 42,805 43,068 43,332 43,490 43,630 43,749 43,973 <14,W 44,404 44,599 44,809 45,089
6" 6.962 7,011 7,080 7,133 7,150 7,159 7,203 7,247 7,274 7,297 7,317 7,355 7,390 7,427 7,459 7,494 7,541
8"
10·
Total 698,714 703,605 710,545 71$,820 717,529 718,487 7U,907 727,342 729,994 732,337 734,340 738,098 741,619 745,332 748,603 752,124 756,824
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 97 of 158
Growth Input
Comm~rdaV
lnstltutionaVOther
S/8
Total
Total
Total
3/4
1"
i.s·
2"
2.5'
3'
4'
6'
8'
10"
Growth Input
Agricultural
5/8
3/4
1·
1,5'"
2·
2.s•
3" ...
6'
8"
10•
GroW\h Input
Irrigation
5/8
3/4
1·
1.s·
2'
2.5"
3•
4'
6"
8"
10·
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
0.9% 1.lK 0.1" 0.2% 0.8" 1.6" 1.3" 1.3" 1.6% 1.7'< 1.7'< 1.1,. 0.9%
F.YE :Z019 FY£ 2020 FYE 2021 FYE 202.l FYE 2023, Pt'E ioz4 FYE 2.025 FYE 202.G fY( 201.7 FYE io.u FYE ZOl.9 FYE 2030 FYE 2031 (YE 2032 FYE 2033 FVE 2034 FVE 2035
36,264 37,011 37,096 37,130 37,215 37,419 37,722 38,319 38,820 39,319 39,942 40,634 41,316 41.817 42,196 42,619 43,056
17,852 18,220 18,262 18,278 18,320 18,420 18,570 18,863 19,110 19,356 19,662 20,003 20,339 20,586 20,n2 20,980 21,1.95
87,503 89,307 89,512 89,593 89,799 90,290 91,0ll 92,462 93,672 94,876 96,378 98,049 99,694 100,904 101.817 102,839 103,893
267,368 272,881 273,508 273,754 274,385 275,885 278,121 282,521 286,218 289,89& 294,488 299,593 304,620 308,316 311,107 314,230 317,449
691,200 705,452 707,071 707,708 709,339 713,217 718,999 730,373 739,930 749,444 761,309 n•,501 787,503 797,058 804,273 812,347 820,668
34,371 35,079 35,160 35,192 35,273 35.,466 35,753 36,319 l6,7~ 37,267 37,&57 38,513 39,159 39,635 39,993 40,395 40,809
43,169 44,059 44,161 44,200 44,302 44,544 44,906 45,616 46,213 46,807 47,548 48,372 49,184 49,'181 50,231 50,736 51,255
867 885 887 888 890 895 902 917 929 940 955 972 988 1,000 1,009 1,019 1,030
45,252 46,185 46,291 46,333 46,439 46,693 41,012 47,817 48,442 49,0(;5 49,842 50.706 51,557 52.'182 S2,6S5 53,183 53,728
1,223,845 1,249,080 1,251,948 1,253,074 1,255,962 1,262,829 1,273,067 1,293,205 1,310,128 1,316,972 1,347,91:n 1,171,350 1,394,361 1,411,279 l,424,0S4 t,438,349 1,453,032
0.5" 0,7'1 '·°" 0.7'1 0.2" o.,,. 0.6,. 0.6" 0.4" 0.3" 0.3" 0.5" 0,.5" 0.4" o.s" 0,6"
f'f't 2019 FVE 2010 FYC 2021 FYE. ~022 J.'YE 2023 FY£ 2024 FYE 1025 FYE 1026 NE 1027 f't't 2018 t--YE 2029 FYE 2010 FYE 2031 F'YE 2032 FYE 2033 F'YE 20~ FYE 20.lS
736 741 748 754 756 757 761 766 769 n1 n, 777 781 785 788 792 797
1,171 1,179 1,191 1,200 1,202 1,204 1,211 1,219 1,223 1,227 1,231 1,137 1,243 1,249 1,254 1,260 1,268
577 581 586 S91 592 593 597 600 602 604 606 609 612 615 618 621 625
4,49• 4,526 4,571 4,604 •,615 4,622 4,650 4,679 4,696 4,711 4,724 4,748 4,770 4,794 4,815 4,838 4,868
26,797 26,984 27,251 27,453 27,518 27,555 27,725 27,895 27,996 28,086 28,163 l8.307 28,442 28,585 28,710 28,845 29,025
52,311 52,6n 53,197 53,592 53,720 53,791 54,122 54,454 54,653 54,828 54,978 55,260 55,523 55,801 56,046 56,310 56,662
86,086 86,688 87,543 88,193 88,404 88,522 89,066 89,613 89,939 90,228 90,47S 90,938 91,372 91.,829 92.,2.U !12,666 93.245
0.5" 0,7'1 1.0" 0,7" 0.2" 0.1" 0.6" 0.6" 0.4" 0.3" 0.3% 0.5" 0.5" 0.5" 0.4" o.s" 0.6"
FYE. 2019 FVE 2010 FY£ 2021 fVE 2022 fYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2018 FYE 2029 FYE 2030 FYE .2031 t'V£ 2032 FY£ 2033 fYE 2014 F\'E Z03S
10,202 10,274 10,375 10,452 10,477 10,491 10,556 10,620 10,659 10,693 10,723 10,778 10.829 10,883 10,931 10,982 11,051
10,196 10,267 10,368 10,445 10,470 10,484 10,549 10,613 10,652 10,686 10,716 10,770 10,822 10,876 10,924 10,975 11,044
83,744 84,:330 85,162 85,794 85,999 86,114 86,64.ci 87,175 87,493 frT,774 88,014 8M64 88,886 89,331 89,723 90,145 90,709
248,348 250,087 252,553 254,428 255,036 255,376 256,947 '.258,524 259,466 260,299 261,011 262,347 263,598 264,918 266,081 267,332 269,003
413,471 416,367 420,474 423,595 424,606 425,173 427,789 430,413 431.983 433,369 434,SSS 436,nl 438,862 441,059 442,995 445,079 447,860
47,052 47,381 47,849 48,204 48,319 48,383 48,681 48,980 49,158 49,316 49,451 49,704 49,941 50,191 50,411 50,649 50,965
10,890 10,966 11,075 11,157 11,184 11,198 11.,267 11,336 11,378 11,414 11,446 11,504 11,559 11,617 11,668 11,723 ll,796
823,905 829,673 837,856 844,076 846,091 847,220 852,433 857,662 860,789 863,SSl 865,91S 870!345 874,497 878,876 882,733 886,S!S 892,427
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 98 of 158
CARLSBAD I POTABLE AND RECYCLED WATER RATE STUDY I Water Cost of Service Study
Total
Growth Input
5/8
3/4
1•
1.5'"
2"
2-S"
3" ..
6"
8"
10"
0.S"
541
4,888
152,422
S28,828
650,176
31,722
39,594
199,325
121,924
1 729,42.1
OCTOBER 2019 I FINAL
0.7"
54S S50
4,922 4,971
lSl,489 155,003
532,531 -S37,783
654,728 661,186
31,9~4 32,259
39,871 40,265
200,720 202,700
122.n1 123,988
1,741,529 1,758,705
0.7" 0.2" 0.1,. 0.6,.
554 556 556 S60
5,008 5,()20 5,026 5,057
156,154 1S6.526 156,735 157,700
541,nS 543,069 543,194 547,139
666,094 667,685 668,576 672,689
32,499 32,577 32,620 32,821
40,564 40,660 40,71S 40,965
204,205 204,692 204,966 206,227
124,909 125,207 125,374 126,145
1,771,761 1,775,992 1,ns,362 t,789,303
0.6,.
563
5,088
158,667
SS0,496
676,816
33,022
41,216
207.492
126,919
1,800,260
0.4,. 0.3% 0.3% 0,5" 0.S" O.S" 0.4,. 0.5,. 0,6"
S6S S67 569 S71 574 sn 580 S82 586
S,107 S,123 S,137 5,164 S,188 5,214 S.237 5,262 S,295
159,246 159,757 160,194 161.013 161,782 162.592 163,305 164,073 165.099
552,503 SS4):76 SSS.793 558,636 561,302 564,112 566,588 569,253 sn.s10
679,284 681,464 683,328 686,824 690,101 693,556 696,600 699.Sn 704.2SO
33,142 33,.249 33,340 33.SlO 33,670 33,839 33,9&7 34,147 34,361
41,367 ·~·99 41.613 41,826 42,025 42,236 42,421 42,621 42,887
208,248 208.917 209,488 210,560 211,565 212,624 213,557 214,561 215,902
127,382 127,791 128,141 128,796 129,411 130,059 130,629 131,244 132,064
1,806,844 1,812,643 1,817,602 1,826,902 1.835,618 1,844,808 1,852,904 1,861,620 1,873,254
Nov. 19, 2019 Item #16 Page 99 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Appendix B
WATER SUPPLY PURCHASES AND COSTS
Water Purchases Escalators
Customer Service Charge Increase
Emergency Storage Ch•rge lncre•se
Infrastructure Access Charge Increase
Supply Reliability Charge Increase
MWD Capacity Reservation Charge Increase
MWD Readiness to Service Charge Increase
Transportation Rate Increase
SDCWA M&I Melded Supply Rate Increase
SDCWA Melded Treatment Rate Increase
Desai• Fixed Capital Increase
Desai• Fixed Financing Increase
Desai -Fixed O&M Increase
Desai• Fixed Electricity Increase
Desai• Variable O&M Increase
Desai -Variable Electricity Increase
Desai• Conveyance Cost Increase
Desai -Indirect Costs Increase
Desai· T.O. Inefficiency Increase
Desa I· Wheeling Increase
FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024
5.00% 5.00% 5.00% 5.00% 5.00%
5.00% 2.00% 2.00% 2.00% 2.00%
10.00% 20.00% 1.00% 1.00% 1.00%
30.00% 5.00% 5.00% 5.00% 5.00%
3.00% 3.00% 3.00% 3.00% 3.00%
6.00% 6.00% 6.00% 6.00% 6.00%
10.00% 5.00% 5.00% 5.00% 5.00%
2.00% 6.00% 6.00% 6.00% 6.00%
2.00% 2.00% 2.00% 2.00% 2.00%
0.00% 2.50% 2.50% 2.50% 2.50%
9.70% 9.70% 9.70% 9.70% 9.70%
2.50% 2.50% 2.50% 2.50% 2.50%
2.50% 2.50% 2.50% 2.50% 2.50%
2.50% 2.50% 2.50% 2.50% 2.50%
3.00% 3.00% 3.00% 3.00% 3.00%
0.00% 2.50% 2.50% 2.50% 2.50%
1.50% 1.50% 1.50% 1.50% 1.50%
6.00% 6.00% 6.00% 6.00% 6.00%
6.00% 5.00% 5.00% 5.00% 5.00%
DRAFT I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 100 of 158
CARLSBAD j POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
SDCWA/MWD Purchases
Water Consumption Override
Water Purchases !Af1 12,923 12,636 I 12,131 I 12,768 I 12,802 I
Water Purchases jgfl 5,629,295 s,S04,o89 I s,54s,s13 I s,s61,613 I s,s16,426 I
Water Purchasee (MGD) ll.54 11.28 I 11.31 I 11.40 I 11.43 I
Customer Data (eel) 6,189,248 6,240,841 6,279,003 6,293.891 6,307,482
System Loss Qnput) 8.5% 8.5% 8.5% 8.5% 8.5%
System Loss (colculated} 5,100,248 4,970,631 5,008,793 5,023,681 5,037,272
Axed Charges (CY) [,£,,.1,w,1 ~ 9':~ (!I .,.m ~
Customer Service Charge s 812,784 $ 853,423 $ 896,094 $ 940,899 $ 987,944
Emergency Storage Charge 2,243,167 2,288,030 2,333,791 2,380,467 2,428,076
Infrastructure Access Charge 1,594,656 1,913,587 1,932,723 1,952,050 1,971,571
Supply Reliability Charge 1.329,m 1,396,262 1,466,075 1,539,378 1,616,347
MWD Capacity Reservation Charge 267,570 275,597 283,865 292,381 301,152
MWD Readiness to Service Charge 'YBas1 508,524 539,035 571,378 605,660 642,000
Fixed Charges (FY)
Customer Service Charge $ 816,858 $ 833,104 $ 874,759 $ 918,497 $ 964,422
Emergency Storage Charge 2,255,110 2,265,599 2,310,911 2,357,129 2,404,271
Infrastructure Access Charge 1,448,754 1,754,122 1,923,155 1,942,387 1,961,811
Supply Reliability Charge 1,214,769 1,363,017 1,431,168 1,502,727 1,577,863
MWD Capacity Reservation Charge 272,085 271,584 279,731 288,123 296,767
MWD Readiness to Service Charge 508,524 539,035 571,378 605,660 642,000
Total Axed Charges (FY) $ 6,516,099 $ 7,026,460 $ 7,391,101 $ 7,614,522 $ 7,847,133
Axed per AF $504 $556 $581 $596 $613
·1% 10% 4% 3% 3%
Variable Charges (CY) ~ ~"m ~ ~l r.i.-~ I
Transportation Rate s 132 $139 $146 $152.81 $160.45
SDCWA M&I Melded Supply Rate $ 925 $981 $1,039 $1,102 $1,168
SDCWA Melded Treatment Rate s 280 $286 $291 $297 $303
CWA Drought fee
Variable Price per AF $ 1,337 $1,404.70 $1,476.17 $1,551.63 $1,631.32
TotalVartable Costs (FY) s 17,071,393 s 17,321,580 s 18,337,823 s 19,329,282 $ 20,373,629
Total SDCWA & MWD Charges (FY} $23,587,492 $24,348,040 $25,728,925 $26,943,804 $28,220,762
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 101 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Desai Purchases
Contract Desai Water, Min. 2500 AF (1,5) 2,500 2,500 2,500 2,500 2,500
Additional desal water, AF (1) 416 416 416 416
Total Desai (AF) 2,500 2,916 2,916 2,916 2,916
In cq 1,089,000 1,270,210 1,270,210 1,270,210 1,270,210
Fixed Charges ($/ AF), Calendar Year (4,5) r~Icm r~ ' ' ,. ' Capital, Debt Service Charge $552.44 $566.25 $580.41 $59~ $609.79
Capital, Equity Return Charge $469.49 $515.03 $564.99 $619.80 $679.92
FlxedO&M $474.30 $486.16 $498.31 $510.77 $523.54
Flxed Electrictiy $152.15 $155.95 $159.85 $163.85 $167.95
Variable Charges ($/AF) (4,5)
Variable O&M $122.77 $125.84 $128.99 $132.21 $135.52
Variable Electricity $653.60 $673.20 $693.40 $714.20 $735.63
Other Costs ($/ AF) (4,5)
Conveyance (Pipeline Debt Payment) $218.26 $223.72 $229.31 $235.04 $240.92
Indirect Costs (2) $32.80 $33.29 $33.79 $34.30 $34.82
Administration Charge $10.30 $10.92 $11.58 $12.27 $13.01
Wheeling (Transportation Charge Including credit $101.83 $106.93 $112.27 $117.89 $123.78
Axed Costs($)
Capital $1,381,100 $1,651,188 $1,692,468 $1,734,779 $1,778,149
Financing $1,173,735 $1,501,842 $1,647,521 $1,807,330 $1,982,641
Fixed O&M $1,185,746 $1,417,630 $1,453,071 $1,489,398 $1,526,632
Fixed Electrictiy $380,378 $454,764 $466,133 $477,787 $489,731
Variable Costs($)
Variable O&M $306,936 $366,961 $376,135 $385,538 $395,177
Variable Electricity $1,633,992 $1,963,065 $2,021,957 $2,082,616 $2,145,094
Other Costs($)
Conveyance $545,650 $652,357 $668,666 $685,383 $702,517
Indirect Costs $82,007 $97,088 $98,544 $100,023 $101,523
T.O. Inefficiency $25,758 $31,847 $33,758 $35,783 $37,930
Wheeling (Transportation Charge lncludingcredrt $254,586 $311,796 $327,386 $343,755 $360,943
Total Desai Costs, CY (3) $ 6,969,887 $ 8,448,538 s 8,785,638 s 9,142,391 s 9,520,338
Desai Costs (FY Basis) s 6,969,887 s 8,448,538 s 8,785,638 s 9,142,391 s 9,520,338
Recycled Water Purchases
Assumptio ns
Potable Water Cost $ 1,321 $ 1,371 $ 1,440 $ 1,514 $ 1,591
Vallecitos Annual Escalation 3% 3% 3% 3% 3%
Reclaimed Water Increases
Expected AF to be Sold (Historical Sales &Custom 3,998 4,037 4,067 4,077 4,083
System Losses 5% 5% 5% 5% 5%
Recycled Water to be Purchased 4,198 4,239 4,271 4,281 4,287
Source of Supply (in AF)
Vallecitos Water District (VWD) 3,135 2,386 2,386 2,386 2,386
Carlsbad Water Recycling Facility (CWRF) 1,063 1,853 1,885 1,895 1,901
Total Recycled Water (AF) 4,198 4,239 4,271 4,281 4,287
5-J,eormoving overage 4,172 4,230 4,277 4,232 4,255
Unit Costs
Valledtos Water District (VWO) $ 702 $ 723 $ 745 $ 767 $ 790
Purchase Amount
Valledtos Water District (VWD) $ 2,200,000 $ 1,724,985 $ 1,776,735 $ 1,830,037 $ 1,884,938
Outside RW Purchases $ 2,200,000 $ 1,724,985 $ 1,776,735 $ 1,830,037 $ 1,884,938
DRAFT I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 102 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix C
CAPITAL IMPROVEMENT PLAN
Wat er Connection Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include
✓
✓
✓
✓
✓
✓
✓
Project Title
College Boulevard -Cannon Road to Badger lane (375 Zone)
College Boulevard -Cannon Road to Badger lane (490 Zone)
Desalinated Water Flow Control Facility
Poinsettia Lane -Cassia Road to Skimmer Court
Rancho Carlsbad Groundwater Supply
San Luis Rey Mission Basin Groundwater Supply
Water Modeling
Total Water Connection Projects
OCTOBER 2019 I FINAL
35,000
370,000
800,000 6,000,000
300,000 1,432,000
S0,000
300,000 300,000 300,000
$1,450,000 $0 $6,300,000 $1,837,000 $300,000
Nov. 19, 2019 Item #16 Page 103 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Water Replacement Projects FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Include
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
Project Title
ABANDON POTABLE SERVICES (NEW RECYCLED SERVICES)
AVIARA PARKWAY AND PLUM TREE WATERLINE
CARLSBAD BOULEVARD WATERLINE REPLACEMENT AT TERRAMAR
CAR.LSBAD WATER RECYCLING FACILITY (ENCINA CAPITAL PROJECTS)
CATHODIC PROTECTION PROGRAM
CRESTVIEW DRIVE TRANSMISSION MAIN
EL FUERTE AND CORINTIA STREET PRESSURE REDUCING STATION
FIRE FLOW SYSTEM IMPROVEMENTS
HYDROELECTRIC GENERATOR AT OESAL FLOW CONTROL FACILITY NO. 5
LIMITED ACCESS PIPELINE RELOCATION PROGRAM
MAERKLE FACILITY IMPROVEMENTS
MAERKLE RESERVOIR FLOATING COVER REPLACEMENT
MAERKLE RESERVOIR TRANSMISSION MAIN
MISCELLANEOUS PIPELINE REPLACEMENTS
NORMALLY CLOSED VALVE (INSTALL MOTORIZED VALVE)
ORION CENTER
PALOMAR AIRPORT WATERLINE REALIGNMENT
PRESSURE REDUCING STATION PROGRAM
RANCHO CARLSBAD GROUNDWATER SUPPLY
RECYCLED WATER LINE· CWRF TO AGUA HEDIONDA LAGOON
RECYCLED WATER PHASE 3 • CWRF EXPANSION
RECYCLED WATER PHASE 3 • PIPELINES
RECYCLED WATER PHASE 3 • RESERVOIR
RESERVOIR REPAIR AND MAINTENANCE PROGRAM
SAN DIEGUITO WATER INTERTIE AND PIPELINE EXTENSION
SAN LUIS REY MISSION BASIN GROUNDWATER SUPPLY
SANTA FE II INLET PIPELINE
SANTA FE II RESERVOIR SITE ELECTRICAL IMPROVEMENTS
SCADA IMPROVEMENTS
SIDEWALK/STREET CONSTRUCTION· VALLEY STREET MAGNOLIA AVENUE
TRI-AGENCY WATER TRANSMISSION PIPELINE REPLACEMENT
WATER CONDITION ASSESSMENT PROGRAM
WATER LOSS MONITORING
WATER VALVE REPAIR/REPLACEMENT PROGRAM
WATER, RECYCLED, AND SEWER MASTER PLAN
SCADA IMPLEMENTATION
Total Water Replacement Projects
C c;:,r.-••"·
s 850,000 $ $ $ $
100,000 1,000,500
500,000 2,500,000 150,000
180,000 180,000 190,000 190,000 190,000
800,000
90,000 390,000 390,000 390,000 390,000
200,000 2,075,000
2,000,000 1,000,000
100,000
1,000,000 8,301,000
3,320,000 1,530,000 1,730,000 2,690,000 2,800,000
225,000
600,000 600,000 600,000 600,000 600,000
200,000 1,000,000 1,960,000
50,000
25,000 2,370,000
350,000
390,000 400,000 410,000 410,000 420,000
100,000 100,000 100,000 100,000 100,000
890,000 910,000 930,000 940,000 960,000
50,000 25,000
174,750 897,046 3,144,481 3,486,084 2,479,194
$8,120,000 $6,135,000 $8,950,000 $12,715,500 $15,721,000
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 104 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Recycled Water Connection Projects FY 2019/20 FY 2020/21 FY 2021122 FY 2022/23 FY 2023/24
Include
Total Projects
Project Tltle
RECYCLED WATER LINE· CWRF TO AGUA HEDIONDA LAGOON
RECYCLED WATER PHASE 3 • PIPELINES
RECYCLED WATER PHASE 3 • CWRF EXPANSION
RECYCLED WATER PHASE 3 • RESERVOIR
$0 $0 $0 $0 $0
Recycled Water Replacement Projects FV 2019/20 FV 2020/21 FY 2021/22 FV 2022/23 FY 2023/24
Include Project Title
✓ CARLSBAD WATER RECYCLING FACILITY (ENCi NA CAPITAL PROJECTS) $ 202,800 $ 207,000 $ 211,000 s 215,000 s 219,000
✓ CATHODIC PROTECTION PROGRAM $ 20,000 $ 20,000 $ 20,000 $ 20,000 $ 20,000
✓ CWRF IRRIGATION AND LANDSCAPE . . . .
✓ MISCELLANEOUS PIPELINE REPLACEMENTS . . . 250,000 350,000
✓ ORION CENTER . . . . .
✓ RECYCLED WATER CONDITION ASSESSMENT PROGRAM 50,000 50,000 50,000 50,000 50,000
✓ RECYCLED WATER VALVE & APPURTENANCE REPLACEMENT PROGRAM 110,000 110,000 110,000 120,000 120,000
✓ SCADA IMPROVEMENTS 150,000 . . . .
✓ WATER, RECYCLED, AND SEWER MASTER PLAN 25,000 25,000 . . .
✓ SCADA IMPLEMENTATION 309,677 589,141 710,795 233,285 303,709
Total Projects $867,477 $1,001,141 $1,101,795 $888,285 $1,062,709
Total CIP Project Summary FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24
Total CIP (FY 2019-2040}
R&R 85% $ 6,412,227 $ 6,658,187 $ 13,196,276 $ 17,089,869 $ 19,262,903
Expansion 15% 4,750,000 1,650,000 6,300,000 1,837,000 300,000
Total CIP $ 11,162,227 $ 8,308,187 $ 19,496,276 $ 18,926,869 $ 19,562,903
Total 5--Year CIP (FY 2019-2023)
R&R 75% s 6,412,227 $ 6,891,223 $ 14,136,181 $ 18,947,843 $ 22,104,624
Expansion 25% 4,750,000 1,707,750 6,748,718 2,036,715 344,257
Total 5-Year CIP $ 11,162,227 $ 8,598,973 $ 20,884,898 s 20,984,558 $ 22,448,881
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 105 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Appendix D
PROJECTED O&M COSTS
Revenues
Charges for Suvkes
Code Line Item
4885 PlanChecfc
4976 Special Benefit District Serve
4995 Adminftts
5100 Commodity Usage
5101 Water Delivery Charses
5110 New Account Charges
Slll Badcflow Oevk:e
5113 Qulck Turnon Fees
5115 Scheduled Disconnect Fee
5124 Service lns1atl.1tion Fees
5125 Misc Conn Chg
5127 NonJurlsdlctional F-eu
Other Charges for Servf«s
Total Chal'l[e.s for Sen,ic,a:
Oeveklper fe.t$
Developer Connection Fees
Other Developer Fee.5
Total Oeveloperfeu
Tax Revenues
4010 Adjustments • Current Taxes
4011 Property Taxes• current
4012 Refund$ • Current Taxes
4015 Supplemental PropertyTaxe-s
4016 Refunds p Supplemental Taxes
4018 Unitary Tax (combine w/4011)
4020 Prior Years Propen.y Taxes
4021 Refund$· PriorYe.;uT.ixe5
4027 Surplus Property Tax Increment
4111 Sales and Use tax
OtherT.ax Reveinues:
Total Tax Revenuet
Licenses and pepnjts
4452 Fire -Protect Sys
Other Ucl!nns and Pf:tmlts
Tot81 lkenses and Permib
lntergovemmental
452S Homeowners Exemption
4753 SOCWA/MWO Credits
OU,e;r lntergovl!mrMntal
Total lnte!JOYem mental
Ge-ner1t tmll\lon
General Inflation
General lnfl.ation
Cust. Demand Grwlh + Usage Grwth
Cuuomer Oern.nd Growth
Gntl lnfltn -t-C~mr Omnd Grwth
GM lnfltn + Cstmr Omncf Grwth
Gnrl lnOtR+ cumr omnd Grwtil
Gnrl lnfltn + Cstmr Omnd Grwt.h
Grni lnfltn + Cstmr Dmnd Grwth
Gnt1 lnfltn-+ Cstrnr Omnd Grwth
GM 1nr1tn + Carn, Omnd Grwth
Gnrl lnfltn + CS'lrnr Omnd Grwt.h
(C.ilcuJ.ite.d
Gene..ral tnflatlon
Get,e.ral tnffation
Prooenv Tu: lncreut
General 1nfl.Iuon
Property Tu lncreue
<if-MDI lnflit1on
Gene-ral lnflaoon
Pro~Taxlnc:rease
General lnf11tJon
PropenyTu 1ncre.He
General lnflltlon
General Inflation
General lnf'btion
GtM.ral Inflation
Gene-r1:I Inflation
One Time ex nse
General Inflation
fY£ 2020 FYE .2021 FVE 2022 FYE 2023 FYE 202.4
Projectlon (Pre-Projection (Pre--Pro.}ectk)n {Pr•• Project,on (Pre• Pro)Kdon (Pre--
Rtte lncrea:se) Rat• lnueue) R11e lncn!'ast:) Rate Increase) Ral'f: Increase)
so so so so so
0 0 0 0 0
0 0 0 0 0
28,307,000 28,84l,9J3 29,610,224 30,270,239 30,9l9,737
11,900,000 12,125,293 lM47,863 12,725,328 13,002,574
135,200 139,776 144,l?S 148,103 1S2,06S
15,410 15,932 16,433 16,881 17,332
15,800 16~335 16,849 17,308 11,n1
8,200 8;478 8,744 8,983 9,223
103,100 106,589 109,944 112,939 US,961
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
s 40,484,7l0 $ 41,25S 314 s 42,354,233 s 43,299,780 s 44 244,664
s 211,110 I s 287,109 IS 296,145 IS 304,214 I s 312,352 I
so so so so so
3,220,000 3,342,03S 3,445,641 3,572,785 3,676,7S3
0 0 0 0 0
65,000 67,464 69,555 72,121 74,220
800 820 841 S62 883
58,200 59,655 6:1,146 62,675 64,242
39,200 40,686 41,947 43,495 44,760
12~0001 (22,550) 123,114) 123,692) 124,284)
155,725 161,627 166,637 172,786 1n.s14
0 0 0 0 0
0 0 0 0 0
3,516,925 $ 3,649,739 S 3,762,653 S 3,901,033 $ 4,014,389
so so so so so
0 0 0
$
S2l,!ll0 S22,34S S22,904 S23,476 $24,063
0 0 0
1,100 1,128 1,156 1,185 1,214
22,900 23,473 24,0S9 24,661 2s~2n
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 106 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
flnff & Forf~lture$
SID Reconne-et Fees
5212 Code! Vaolations
5222 Return Check Fee
522S Late Charges
5226 Door Har,cer Fee
5229 MISC RMS
Other Finu & Forfcitort:s
Total Anes & ForfeJtures
fnsome from Proo & Investments
5300
5305
5315
5320
5341
5342
5360
5361
5362
Interest Income -Pooled cash
tn1crest -Unre~liled Gains/Lo5$-es
lnttrest Income -Propeny Ta,c
FacUJtles A.entars
Other Rentals and Leasts
Cell Site Leases
Sale of Capital Ass.ets
Donated AS$ets
Scrap & Recyde
Other lncome from Prop & lnveslments
Total Income from Prop & lnviHlm•nU
lnterdee1rtmrn1at
S430 Eng labor
5442 Reimbursed Work for Other Dept.
Other lnterdepartmenta l
Total lnt~rdepartmental
Qther Reyenues
5542 Major FaciUtles
5550 Prior Year fee Refunds
5632 Stri.lglllS/Sigo,
S634 Misc Damages
S636 Lo.u RecOYCry
5638 Misc: Reimbursement Losses
5639 Misc Re)mbursement Expenses
5664 Mlsc AR Write Offs
5674 Mise Rt-Yenues
Other Other Revenues
TotaJ Other Revenu@s
0th££ fmaocjng sources
5900 T~nsfers tn
Other Other fi~ricing Sources
Total Other f",nanciog Sources
Total Revenues
OCTOBER 2019 I FINAL
General Inflation
General Inflation
General lnfla1ion
General Inflation
Gener,1 Inflation
Gener,! Inflation
General Inflation
lntaest Income
General Inflation.
Interest loc:ome.
General Inflation
General 1nf11tion
General Inflation
Cimt'rallnflation
One Time Ex:pe.~-
Genenl lnflitlon
General lnnation
Gerwral Inflation
Gene~I Inflation
Gent!-ral Inflation
Gener.ti loflatlon
General Inflation
General lnflatlon
Genenl lnflatk>n
Ge.ner1l lnfl1tlon
General Inflation
Generi1l lnfla1lon
General Inflation
Gener111 lnflatlon
General Inflation
No Annual Increase
Gene~I Inflation
FYE2020 M2021 M2022 M2023 f'YE2024
$3,100 S3,178 $3,257 $3,338 $3,422
$100 $103 $105 $108 $110
4,300 4,408 4,518 4,631 4,746
27l,700 279,518 286,505 293,668 301,010
3,900 3,998 4,097 4,200 4,305
0 0 0 0 0
0 0 0 0 0
284,100 $ 291,203 $ 298,483 $ 305,945 $ 313,593
$598,617 $611,787 $625,858 $ .. 0,878 $656,900
0 0 0 0 0
5,300 5,417 5,541 S,674 5,816
0 0 0 0 0
40,900 41,923 42,971 44,04S 45,146
213,SOO 21S,838 224,308 229,916 23S,664
0 0 0 0 0
0 0 0 0 0
400 410 420 431 442
0 0 0 0 0
8S8,717 $ 878,373 $ 899,098 $ 920,944 $ 943,968
$108,200
0
0
108,ZOO
$10,100
0
0
0
52,900
2,733
187,200
0
28,000
0
2ao,933
$0
0
$ll0,905
110,905 s
$10,353
0
0
0
54,223
2:,802
191,880
0
28,700
0
2s11gs1
so
$113,678
0
0
113,678
$10,611
0
0
0
SS,.578
2,872
196,677
0
29,418
0
29S,1S6
$_0
0
$116,520
116,SZO
S10,877
0
0
0
56,968
2,944
201,594
0
30,153
0
$0
46,496,963 s 47,747,360 $ 48,871.417
$119.,433
0
0
119,413
$11,149
0
0
0
58,392
J.017
206.,634
0
30,907
0
310.098
$0
0
4!>,971,422
Nov. 19, 2019 Item #16 Page 107 of 158
I
Expenditures
Per5onnel
Code line Item
6100 Reg Salarles
6101 lnctntl~t-Pay
6140 Other Personnel
6150 IOO Worker's Comp
6200 Overt1me Salaries
6210 Star.db)' Pay
6300 Pamimc Salaries
6310 EIKted Offidals' sa\.arits
6400 Temporary Help
6501 H@althlnsur.mc:e
6S10 Ufe lnsu~nce
6520 Vfslon lmuf'i~
6S30 Medicare
6620 MTG Physlc.ils
6629 Cell Phone AUowa nee
6630 Allio Allowance
6640 Earned leave Accn.,al
6651 Healthy Emp Aw1rd5,
6653 Final Vacatlon Pay
6654 Final Sick Leaive Pay
665S Dis.ability
6656 Ullemployment
6657 Worker's Compensation
6720 PERS
sno PERS UAL Exp
6721 PERS (GASB 68 Contra Account)
PERS. Repayment
6722 OPE8 E.x.pens~
6730 5oeial Security
6140 Deferred Comp
6741 Def Comp Match
Other PeriOmel
Total Pe,sonnel Costs
Maintenance & Equipment
7ll0 Off,ce Equip Rental
7111 Other Mach & Equip
7115 Vehicle Rentals
7119 Misc Rentals
7120 Misc Leases
7210 Offite Equip Maintenance
72U Communication Equip Maintl!f'lanc:e
7:n.s Software Maintenance
n20 Vehlde Maim
7221 Wash ,nd W-ax
7222 Other Equip Malntel'\itnee.
7225 Car Wash Repairs
7226 Pipeline Mainten.ince
7227 Fire Hydr,nt Maintenance
7230 Routine Building Malnten,ance
7241 Asphalt Repairs
7244 Street Swl!@plng
7249 Malntet1anu , Rtpalr and Rehab
7400 Audll
7410 Legal
743S Admlnlstntfve
7480 ClaimsAdmin
7490 M;sc Professio~I Services
7500 Encin.a Servkes
7510 City Generated
7511 CitJten Gt-nera.ted
7SSO Mkctllaneous Outside Services
7S51 Bank Se-MC@s
7552 Book Binding
7553 Comm Arts Support
7554 i:tegulatory/Permtttl,. Fees
?556 Misc Services:
Customer servke charge
Emergency Storage Ch1rge
7557 lnfrastructurn Access Charge
Supply Reliability Chargo
MWO Capadty Reservation Charge
MWO ReadJness to SeMec Charge
C c:a,-•,,..
Water Cost of Service Study I POTABLE AND RECYCLED WATE~ RATE STUDY I CARLSBAD
labor Inflation
Labor Inflation
Labor lnf~tion
bbotlnflation
bborlnflilion
labor Inflation
Labor lnftldon
Labor Inflation
Labor Inflation
bbor• He;iilth lns~nce
bborlnf11lion
Ubor lnffaUon
Labor Inflation
Labor Inflation
labor lnffatiOn
L.ibor lnfli1tion
bbor lnfl1tion
labor lnfl•Oon
labor Inflation
tabor Inflation
labor Inflation
Ubor Inflation
Ubor lnf11tlon
labor· PERS (Norm.al Cost I
Labor• PER.5 [Normal Con)
labor• PERS (Normal Cost)
ubof • PERS (UAl)
One Tlme Exo,mse:
labor INUltion
Ubor Inflation
Labor lnfl1Uon
Ubor lnfliilllion
General lnflitlon
General lnfl11ion
General 1nnat1on
G~Dllnflatfon
Generil Inflation
Gener,a.l lnflateon
Gffle.ral Inflation
General Inflation
General tnfl1tion
Gfflenl lnfbtJon
Gtnenl lnflatJon
General Inflation
General Inflation
General Inflation
Gener,1 lnflitlon
GeMr1cl ln01tlon
General Inflation
GeMral Inflation
General lnflatlon
Gener,I lnflitlon
Gener,I lrdlitlon
General fnfladon
General lnflatiOn
~neral Inflation
General lnfl,tion
Genen1l lnfliltlon
General Inflation
GeM:ral rnflatM>n
General lnflatlon
General ln.ftiltion
Ge~ri11 lnftilt5on
General lnflitlon
{Calcut.1cd]
(Calrulattd]
(Calculated]
(Calculated]
{Calculated)
{Cakul.ated)
Projection {Pre• Projt«lon (Pre--ProjC!a:ion (Pre-Projtedon (Pre-ProjeaJon (Pre•
Rate Increase) Rate Increase) Rate Increase) Rate: lnut•lt!) Rate lflC(ea~)
$2,340,216 $2,410,422 $2.482,73S $2,557,217 $2,633,934
so $0 $0 $0 so
0 0 0 0 0
0 0 0 0 0
Ul,063 114,395 117.627 121,362 125.002
22.S44 23,220 23,917 24,634 lS,373
9,888 10,185 10,490 10,805 ll,U9
7,000 7,210 1,426 7,649 ?,879
40,000 41.200 42.436 43,709 4S,020
447,441 480,462 514,719 550,132 586,606
2.360 2.431 2,S04 2.579 2,656
0 0 0 0 0
36,886 37,993 39,132 40,306 41,516
410 422 435 ... 461
2,550 2,627 2.7C15 2~786 2,870
0 0 0 0 0
0 0 0 0 0
17,750 18,283 18,831 19,396 19,978
0 0 0 0 0
22.575 23,252 23,950 24,668 25,408
6,315 6,504 6,700 6,901 7,108
60,120 6).924 63,781 65,695 67,666
289,851 318,176 327,721 337,553 347,679
303,753 346,137 388,548 422,964 438,813
0 0 0 0 0
5,133 5,287 S,446 5,609 5,m
0 0 0 0 0
0 0 0 0 0
3,725 855 s 3,910,129 s 4,079,303 s 4 244 413 s 4,394,875
$500 $513 $52S S538 $552
2.000 2.050 2.101 2.154 2.208
2.1s0 2,104 2,2S9 2,.315 2,373
S,000 5,125 5,253 5,384 5,519
].500 ].538 1.576 1,615 1,656
lll,000 134,275 137,632 14].073 144,599
450 46} 473 485 497
SOD 513 525 538 552
125,000 128,125 131,328 134,611 137/j77
50,000 51,250 52,531 53,845 55,191
5,000 S,125 5,253 5,384 S,519
40,000 41.000 42,025 43,076 44,153
5,000 5,12S 5,253 5,3&4 5,519
70,000 71.750 73,544 75,382 n ,.267
2.000 2,050 2.101 2,154 2,208
421.SOO 432,038 442.838 453,909 465,257
483,600 495,690 508,082 520,784 533,804
120,000 123,000 126,075 129,227 132.4S8
816,858 833,104 874,?S9 918;497 964,422
?,255,UO 2,265,599 2,310,911 2.357,129 2,404,271
1,448,754 1,754,122 1,923,155 1~42,387 1,961,8U
1,214,769 1.363,017 1,431.168 1,502,727 1.sn,863
272,085 271,584 279,731 288,123 296,767
508,524 S39.1)3S 571.378 6[15,660 642.000
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 108 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
7S58 Laundry and Uniform Malntenanc;e
7559 ElectricaVScada Servic;es
7560 W.t;ter Sa mpli"8 Services
7561 Water Conservation Setvlces
7564 Landscaping Services
7710 Ads and Publishing
7711 Dues and Subscriptions
7712 Books and Publiutions
7713 Audio-Visual Materlills
771S Printing
1no Postage
7725 Office Supplies
7726 Offke Furniture & Equipment
7730 Computer Softw~re
7731 Misc. Computer Hardware
7735 Promo Materlals
7741 Preschool
7745 Food E"xpense
7750 Heat alld Light
7751 Telephone &CommunlcatiOns
7752 Waste Disposal Scrvfct-s
77S3 WatN
7801 Building Maintena !\Ce
7810 Electrical Supplies
7811 J:anilori.al Supplies
7820 Parts•Vehtcle5
7821 Parts-Eciuip
7830 Rock and Mine:ra I Products
7831 Asphalt
7850 Small Tools
78Sl safety Equipment
7852 uniforms and Accessories
7853 Mel[!f"S/f'rttings • New Development
7863 Melef"S/Frttings • Replacement
7855 Flre Hose and Appliances
7856 Rescue Equipmem
7857 Personal Protective Equipment
7858 Breathing Apparatus Equipment
7865 Automated Meter Program
7880 Ga~line and Oil
7881 Propane
7882 Other Petrol Products
788.3 Ch~mitals
7890 CMWD Pure Watet•Outside A&ency
7892 Desai Costs
7899 Misc Supplies
8110 Employee Training
8120 Tuition Relmburnment
8130 Training/Training Related Travel
8500 Oepreclation
8510 Prop Taxes PO
8S20 Conference Travel
8522 Misc. Mta ls/Milts
85'30 Bad Oebt Exp• Other Inv/Bills
8534 RegOver/Short
8610 Settlements
8615 Interest on Deposit
8621 lnterfund servlces
8699 Misc Expenditures
8700 Contingencies
8809 Vehicle Direct Char&e.s
8810 Vehicle Maintenance
8811 Vehicle Replacement
8820 Strut Lighting
8822 Med~n Maintenance
8830 Genera I Lab
8840 Copy Services
885S Records MaRage:ment lnterdept
8860 lnformatk>n Technologies
8890 Misc Interdepartmental Charges
8891 Mi> Chg Sad<
8892 UtUity 8Ullng Charge-bad:
8910 FTscal Agent Fees
8911 Arbitrage Costs
8912 Misc Debt Expense"
8920 Principal
6921 Interest Expense
8922 Int Exp-Capital/zed Interest
6930 AmortJzation Expe-nse
8931 Issuance Costs
Other
Addrtionat Ma intenan,;e & EauiD1T1ent
Total Maintenance & Equipment Costs
OCTOBER 2019 I FINAL
Gefleral lnf~tlon
Gmtnl lnfladon
Gtneral Inflation
Gtntttal lnFlaHon
Generil lnflatlon
~er.11 Inflation
General lnfbtton
Gener'II lnflatk>n
Genenl Inflation
General Inflation
General lnfla1ion
Generil Jnflition
Genenl lnflaHon
Genenl lnflalk>n
GeM:nl Inflation
GeMral Inflation
General Inflation
General Inflation
Utllit~s lnfbuon
UtlUtiH Inflation
Utl!ities Inflation
Utiijtles Inflation
Geoeral lnfl.aitlon
Gene1'3l lnflatlon
Ge11eral lnfl1tion
General Inflation
Geoeral 1nfl.atlol'I
General lnflatiOl'I
General lnflnlon
General lnfladon
Gme.r.al lnfl.itlon
General Inflation
General lnflatton
General Inflation
General lnfJat~n
Gf:ntral lnfbtion
Genenl Inflation
General Inflation
Generi1l lnfb1tkm
UtlUOes Inflation
Gene,,I lnflatk>n
General Inflation
Chemicals tnfb,Uon
(C•lculat!!d]
(Calculated)
Ge.nenl Inflation
Ge.neral lnf~tlon
General Inflation
Ge-nera11nflation
Oepredatlon Fundina
General lnflnlon
Gffleral tnfliitlon
General lnfl.atlol'I
General Inflation
General lnfl:.ation
General Inflation
Gerienl Inflation
General Inflation
Gene,-1 lnf-lation
General Inflation
Genenl lnflat1on
Genenl lnfbtion
Gieneral Inflation
General lnflahon
Gener1l lrtfladon
GeMral Inflation
General lnflatlon
General Inflation
General lnfb.tion
Gene~I Inflation
Genc.~l lnfbtlon
General Inflation
Gentral Inflation
General Inflation
Genenl lnfl.aUon
[Ciilkulated)
[Caleulatod)
Gentnt Inflation
General Inflation
Genenil lnfl,tion
No Annual lncreue
No Anrw~l lncreue
FYE 2020 FYf :Z.021 FYE 20ll FYE 2023 FYE 2024
8,000 8,200 8,405 8,615 8,831
105,000 107,625 110,316 113,074 115,900
158,000 161,950 16S,999 170,149 174,402
22,SOO 23,063 23,639 24,230 24,836
60,000 82,000 B4,0SO 86,151 88,305 soo 513 525 538 5S2
40,000 41,000 42,025 43,076 44,153
1.200 l,'230 1,261 1,292 1,325
lS,000 lS,375 lS,759 16,153 16,557
7,000 7,175 7,354 7,538 7,TD
10,000 10,250 10,506 10,769 11,038
15,000 15,375 15,759 16,153 16,SS7
15,000 15,375 15,759 16,153 16,557
5,000 5,125 S,2S3 5,384 S,519
8,000 8,200 8,405 6,615 8,831
115,000 120,750 126,788 133,127 139,783
,38,000 39,!IOO 41,895 43,990 46,189
10,000 10,500 11,02S ll,S76 12,155
10,000 10,500 11,025 11,576 12,155
1,000 1,025 1,051 1,on 1,104
223,000 228,575 234,289 240,147 246,150
15,000 15,375 15,759 16,153 16,557
5,000 5,125 5,253 S,384 S,S19
lS,000 25,625 26,266 26,922 27,595
3,500 3,588 3,677 3,769 3,863
110,000 112,7'50 llS,.569 118,458 121,419
126,000 129,150 132,379 135,688 139,080
2,000 2,100 2,205 2,315 2,431
500 513 525 538 552
25,000 26,250 27,563 28/l41 30,36"
17,071,393 17,321,580 18,337,823 19,329,282 20,373,629
6,969,6"7 8,448,536 6,785,638 9,142,391 9.520,338
45,000 46,125 47,278 48,460 49,672
1,000 1,025 1,051 1,on 1,104
10,000 10,250 10,506 10,769 11,038
4,100,000 4,187,740 4,237,993 4,26",425 4,336,600
5,000 5,125 5,253 5,384 S,S!9
26,000 28,700 29,418 30,153 30,907
3,533 3,621 3,7U 3,805 3,900
10,000 10,250 10,506 10,769 11,038
72,800 74,620 76,486 78,398 80,358
164,900 169,023 173,243 1n.579 182,019
143,3•3 146,932 l50,60S 154,370 158.,.229
85,560 87,699 89,891 92,139 94,442
371,757 381,051 390,S77 400.,342 410,350
1,817,408 1,862,843 1,909,414 1,957,150 2,006,078
.
. ' [1,837,087) (1,874,094) (1,911,878) {1,950,382)
$ 40,080,085 $ 40,710,504 $ 42,586/067 $ 44,318,550 $ 46,137,309
Nov. 19, 2019 Item #16 Page 109 of 158
<;apttal Outlav
9003 Non-Bud&eted Cap Equip <S10K
900S Capit3I Outlay <$10K New
9006 Capital Outlay< $10K • Re.pl
9010 Cap Outlay• Vehk/es
9020 Computer Eq.,ip > $10K -Repl
9021 Offlee Equipment
9022 Other Equipment
9030 Office Furniture
9040 Redass Capital Outtay
90SO t:apit31iz~ Assets
othef Capital Outlay
Total Capital Outlay costs
Other Financing Uses
9999 Transfers Out
Other Other Fini~fng Uses
Total Other Financlns Uses Costs
Total Expenditures
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
General lnfl~lon
General lnflallon
Ge-neral lnflallon
GeOl!tal Jnf\.atton
Gfflen1I Inflation
Gcner1I lrdl.-tlon
c;.....,.11ari.t1on
General lr-llatk>n
Gen1tral lnffatiOn
OM Time Elcpen$t!
GeneniJ lnfl.ltion
Construction lnfbtion
FYE 1.020 fYE. 2021 FYH022 FYE 2023 FYE 2024 so $0 so so $0
S,43S S,574 S,714 S,857 6,003
0
365,000 374,125 383,478 393,06S 402,892
0
0
0
0
0
0
0
370,43a $ 379,699 $ 389,192 $ 398,922 $ 408,895
$2,000,000
0
$2,000,000
$2,0S0,000
$2,0S0,000
$2,101,250
$2,101,250
$2,153,781
$2,1S3,781
$2,207,626
$2,207,626
$ 46,176,379 $ 47,050,333 $ 49,155,812 $ 51,115,665 $ Sl,148,705
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 110 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix E
REVENUE REQUIREMENT ANALYSIS
FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024
Revenues
Water Operations $ 6
Commodity Cha 'lies s 28,307,000 s 28,842,910 $ 29,610,220 30,270,240 $ 30,929,740
Delivery Charges 11,900,000 12,125,290 12,447,860 12,725,330 13,002,570
Non-Rate Charges for Services 277,710 287,110 296,150 304,210 312,350
Developer Fees
Tax Revenues 3,516,920 3,649,740 3,762,650 3,901,030 4,014,390
Licenses and Permits
Intergovernmental 22,900 23,470 24,060 24,660 25,280
Fines & Forfeitures 284,100 291,200 298,480 305,940 313,590
Income from Prop & Investments 858,720 878,370 899,100 920,940 943,970
Interdepartmental 108,200 110,910 113,680 116,520 119,430
Other Revenues 280,930 287,960 295,160 302,530 310,100
Other financing sources
Total Water Revenues $45,556,480 $46,496,960 $47,747,360 $48,871,400 $49,971,420
Recycled Water Operations
Commodity Cha 'lies s 6,677,200 s 6,736,250 s 6,779,860 $ 6,795,080 s 6,806,990
Delivery Charges 1,113,300 1,123,150 1,130,420 1,132,950 1,134,940
Non-Rate Charges for Services 4,000 4,130 4,260 4,380 4,500
Developer Fees 250,000 256,250 262,660 269,220 275,950
Intergovernmental (CWA) 150,000
Fines and Fmfeltures 13,200 13,530 13,870 14,210 14,570
Income from Property & Investments
Interdepartmental 92,100 94,400 96,760 99,180 101,660
Other Revenues 2,000 2,050 2,100 2,150 2,210
Other Financing sources
Total Recycled Water Revenues $8,301,800 $8,229,760 $8,289,930 $8,317,170 $8,340,820
Total Revenues $ 53,858,280 54,n6,no $ 56,037,290 $ 57,188,570 $ 58,312,240
Expenditures
Water Operating Expenses
Personnel $ 3,725,855 $ 3,910,129 s 4,079,303 $ 4,244,413 $ 4,394,875
Maintenance & Equipment (w/o depreciation) 35,980,085 36,522,764 38,348,074 40,030,125 41,798,709
Capital Outlay 370,438 379,699 389,192 398,922 408,895
Other Financing Uses
Total Water Exeenditures $40,076,379 $40,812,593 $42,816,569 $44,673,459 $46,602,479
Recycled Water Operating Expenses
Personnel $ 1,558,540 s 1,635,472 s 1,707,021 s 1,776,773 $ 1,840,158
Maintenance & Equipment 4,817,493 4,406,955 4,533,298 4,591,601 4,723,608
Capital Outlay 50,000 51,250 52,531 53,845 55,191
Other Financing Uses
Total Recycled Water EJ<penditures $9,161,397 $8,829,041 $9,064,908 $9,194,276 $9,391,015
Other Operating EJ<penses
Oebt Service -Potable Water • $ $ s $ $
Debt Service -Recycled Water 2,735,365 2,735,365 2,772,058 2,772,058 2,772,058
Rate-Funded Capital~ Potable Water $ $ $ s
Rate-Funded Capital -Recycled Water
Total Water Exeendltures $ 40,076,379 $ 40,812,593 $ 42,816,569 $ 44,673,459 $ 46,602,479
Total Recycled Water Expenditures $ 9,161,397 $ 8,829,041 $ 9,064,908 $ 9,194,276 $ 9,391,015
Total Operating Expenditures $ 49,237,776 $ 49,641,634 $ 51,881,477 $ 53,867,734 $ 55,993,494
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 111 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Policy Expendit ures
Replacement Funding
Potable Water Repl Funding $ 4,100,000 $ 4,187,740 $ 4,237,993 $ 4,288,425 $ 4,338,600
Recycled Water Repl Funding
Transfets to Capital Reserve
Potable Water $ 2,000,000 $ 2,050,000 $ 2,101,250 $ 2,153,781 $ 1,500,000
Recycled Water
Additions to Meet Minimum Fund Balances
Potable Water $ $ $ $ $
Recycled Water
Total Poli~ Exeend~ures $6,100,000 $6,237,740 $6,339,243 $6,442,206 $5,838,600
Potable Water 6,100,000 6,237,740 6,339,243 6,442,205 5,838,600
Recycled Water
Total Expenditures for Cash Flow Test $55,337,776 $55,879,374 $58,220,720 $60,309,941 $61,832,094
Poroble warer 46,176,379 47,050,333 49,155,812 51,115,565 52,441,079
Recycled Water 9,161,397 8,829,041 9,064,908 9,194,276 9,391,015
Check TRUE TRUE TRUE TRUE TRUf
Cash Flow Surelus !Deficit! $ 11,479,496) ($1,152,654! ($2,183,430} !$3,121,371! !$3,519,854!
Potable Water (619,899) {553,373) {1,408,452) {2,244,265) {2,469,659)
Recycled Worer {859,597) {599,281) (774,978) {877,106) {1.~50,195)
Check TRUE TRUE TRUE TRUE TRUE
8ond Coverage I 1.2.Sx
Debt Coverage Test
Revenues
Water Revenues $ 91,112,960 $ 92,993,920 $ 95,494,726 $ 97,742,800 99,942,840
Water Connection Fee Revenues Allowed
Recycled Water Revenues 16,353,600 16,203,270 16,317,200 16,365,120 16,405,690
Recyded Water Ccnnectlon Fee Revenues Allowed
Total Revenues $ 107,466,560 $109,197,190 $ 111,811,926 $ 114,107,920 $ 116,348,530
Potable Wottt 91,112,960 92,993,920 95,494,726 97,742,800 99,942,840
Recyded Water 16,353,600 16,203,270 16,317,200 16,365,UO 16,405,690
ExpendlWres
Water Expenditures $ 40,076,379 40,812,593 $ 42,816,569 $ 44,673,459 $ 46,602,479
Recycled Water Expenditures 6,426,033 6,093,677 6,292,850 6,422,218 6,618,958
Debt Service -Potable Water
Debt Service • Recyded Water 2,735,365 2,735,365 2,n2,oss 2,n2,oss 2,772,058
Coveraie 683,841 683,841 693,014 693,014 693,014
Total Expenditures $ 49,921,617 $ 50,325,475 $ 52,574,492 $ 54,560,749 $ 56,686,509
Potable Water 40,076,379 40,812,593 42,816,569 44,673,459 46,602,479
Recycled Water 9,161,397 8,829,041 9,064,908 9,194,276 9,391,015
Bond Coverage Surplus (Deficit) $ 57,544,943 $58,871,715 $59,237,434 $59,547,171 $59,662,021
Potoble Water 51,036,581 52,181,327 52,678,157 53,069,341 53,340,361
Recycled Water 7,192,203 7,374,229 7,252,292 7,170,844 7,014,675
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 112 of 158
CARLSBAD J POTABLE, RECYCLED, AND WASTEWATER RATE STUDY J Water Cost of Service Study
FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024
Revenue Requirement -Pot able Water
Revenue Shortfalls $ (619,899) (553,373) (1,408,452) $ (2,244,265) $ (2,469,659)
cash Flow Dnven cash Flow Cash Flov.1 Driven Cosh Flow Driven cash Flow Driven Driven
Revenue Increase January Janua!1 Januarv January January
Calculated Revenue Increase(%) 3.1% 2.7% 6.7% 10.4% 11.2%
Rate Override(%) 1.00% 2.00% 2.00'/4 2.00% 2.00'Ai
Operating Ba/once In Doys of ExpendMures 183doys ll9days 162days 140 doys 119 doys
Coverage% of yeor, {30% ~ 110 Days) 50% 49% 44% 38% 33%
Implemented Rate Increase 1.0% 2.0% 2.0% 2.0% 2.0%
Cumulative Rate Increase 5.4% 7.5% 9.7% 11.9% 14.1%
Cash Flow • Water
Revenues Before Rate Increase $ 4S,S56,480 $ 46,496,960 $ 47,747,360 $ 48,871,400 $ 49,971,420
Revenues From Rate Increase 402,070 819,364 841,162 859,911 878,646
Less: Rate Increase Delay (201,035) (409,682) (420,581) (429,956) (439,323)
Less: Expenditures (46,176,379) (47,050,333) (49,155,SU) (51,11S,66S) (52,441,079)
Cash Flow $ (418,864) $ (143,691) $ (987,871) $ {1,814,309) $ !2,030,336)
Total Available Fund -Potable Water
Beginning Balance s U0,265,845 $ 105,534,246 s 106,877,770 $ 95,621,780 $ 82,734,005
Ending Fund Balance 105,534,246 106,877,770 95,621,780 82,734,005 67,420,365
Fund change $ (14,731,599) $ 1,343,524 (11,255,990} $ (U,887,775! $ (15,313,639)
961 Days 956Days 815 Days 676Days 528Doys
Operating Fund -Potable Water
Beginning Balance s 26,398,268 $ 25,979,404 s 25,835,713 $ 24,847,842 s 23,033,533
cash Flow (418,864) {143,691) (987,871) (1,814,309) (2,030,336)
Transfers to Cap·ta1 Fund
Endin2 Fund Balance 25,979,404 $ 25,835,713 24,847,842 $ 23,033,533 $ 21,003,197
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 113 of 158
Water Cost of Service Study j POTABLE AND RECYCLEU WATER RATE STUDY j CARLSBAD
FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024
Revenue Requirement -Recycled Water
Revenue Shortfalls $ (859,597) $ (599,281) $ (TT4,978) s (Bn,106) $ {l,OSQ,195)
Cash Flow Driven Cash Flow Cosh Flow Driven Cash Flew Driven Cosh Flow Driven Driven
Revenue Increase January Januarv January January January
calculated Rate Increase (%) 22.1% 15.3% 19.6% 22.1% 26.4%
Rate Override (%) 0.00% 0.00% 0.00% 0.1)0% 0.00"/4
Operating Balance in Days of Expendftures 49Zdays 483 days 4Z3days 364 days 295 days
Covero~e % of year, /30'/4 -llO Days/ 135% l3Z% 115% 100% 81%
Rate Increase(%) 0.0% 0.0% O.O"Ai 0.0% 0.0%
OJmulative Rate Increase(%} 6.4% 5.4% 5.4% 6.4% 5.4%
Cash Flows
Revenues Before Rate Increase s 8,301,800 $ 8,229,760 $ 8,289,930 $ 8,317,170 s 8,340,820
Revenues From Rate Increase
less: Rate Increase Delay
less: Expenditures (9,151,397) (8,829,041) (9,064,908) (9,194,276) (9,391,015)
Cash Flow $ (859,597! $ (599,281) $ (TT4,978) $ (BTT,106) (1,050,195)
Debt Coverage per Covenant
Debt Service $ 2,735,365 $ 2,735,365 $ 2,772,058 $ 2,772,058 $ 2,772,058
Net revenue (bond covenant definition of •net") 4,821,539 5,494,768 4,576,393 6,522,849 5,530,126
Debt service coverage 2 2 2
Total Available Fund • Recycled Water
Beginning Balance $ 35,660,258 s 14,520,410 s 14,096,800 s 13,484,585 $ 12,754,980
Ending Fund Balance (Includes Capital Fund) 14,520,410 14,096,800 13,484,585 12,754,980 11,839,726
Fund change (21,139,848) $ (423,610) $ (612,215) $ (729,605) $ (915,255)
825 Days 844 Days 782 Days 725DOYf 653 Days
Operating Fund
Beginning Balance $ 9,519,244 s 8,659,647 s 8,060,365 s 7,285,387 $ 6,408,281
Cash Flow (859,597) (599,281) (n4,978) (877,106) 11,050,195)
Transfers to Capital Fund
Ending Fund Balance $ 8,659,647 $ 8,060,365 $ 7,285,387 $ 6,408,281 $ 5,358,086
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 114 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix F
POTABLE WATER FUNCTIONAL ALLOCATION
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80,000 (U$t0fflf( ·liro'" SCIO CIMDfflef •lklf'n
40,000 (IJSIOfflt,I •ltOAff
1..200 (1,1~ ·IIOAfe
Custotr. •Noflr&
lj,000 (11$tofl'll!r • NO Rr.
l,»:J C~o,rw, •HoRra
10,,000 Cus__, •No Ar.
1S,OCO (1,1.'fflfnff -NoRrt
1$,.000 S.Met-ON
S,000 s-tteOnl
l.000 Cm:..,_ • No fi!W
CUJIIOfl'IS •Norw
CUJ~ -NoRre
US,000 cu~~ -NO Rrt
)$,000 C:IKIGINI • No fire
lO..OOO C.asto-•Nolht
10,000 Cwl!Omn -NORN-
S.000 ,,,.,. u= ~=~~~~~j~~;::~ U6,DOO
i.ooo CetofflC'fOn ~floArw
C.I.Olt>ctOl'i -Hoftn
J:!t,000 C.tomer l.i • No All!
s,ooa C111no1111, On • ttofillf
11,000 C•1om1r •floliff uu Om.tomer •lloffR
J(l,000 Cu.~ •Mo'-
(latomlf -NoflJe c....,'°""' •MoAlt
Cl,J\o,tntr •Mofiile
~r •floffw
C14ton\tf -Hoi:.,.,
eur.i-, l;w! • Ho fn
74,IOO Sttvt, _,,
16',,00 St,vke Inll
tO.>41 ~Odw
Cwtom1:rorw
,--111,~7 CuslDlllefOW. ,Noflnrc
l.,1;17,4011 Cus~arw --
Water Cost of Service Study I POTABLE ANO RECYCLED WATER RATE STUDY I CARLSBAD
7,7H
...., ... ..... .,,.
,S,000
,_
, .... ..... .. ,.
11SIICO .....
l0,000
11),000
....
2.t.,.331 ·-
••n
4lM6l
4n,10&
UlSll
l&J..Jn
e5t.ol2 ,.,.,,,,,.
14VJ~ .......
u,au ....
...
'"'"" 14.817
U0,000 ,,.,,.,
_.,. ...
71.!Ul ,.,,,.
241.&01
ffi-HWRR-1-11 • $ $ • $
l,000 ., .. ·-
m,ooo
... , .. 24~7
L121,SSS ""5» .. , .... ,..,,. m..., ,..,,., lSl,.$$1
105,000
1'8,000 ...,,. u.""
>!,000
45,000
4,;, I
• $ • $
W1
, ....
...
u
2,.1U
"" ... ..
,.,.,
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 116 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
C.plblOiitlay
HDn"lkl"'1cledCtpfqap'-S1l $
Capi~Olld•y<$10t:"-
CiopCM.lly•Vthl~
Coq,ul:N (""' •$101t• ~
Offke(~l ~(~
C..pl~llaclAsseb
OtbN c,piUI OUtiay
Opar.1ol$tl( Opet,~ Slllt Tt S
R<!~ado,.of~AsADOIMrs"
M·€i5MHIII M
, ...
·m 'rlibl_ S,O& I • ,.._ .
. .
• I
• I
I
AsAIOthtn I ' 40,.0,s,.,,, ' 2.tl7,5Ali
t0.07'.ffl ' Z,tl?,3A6
'·"'
CM
$
'
$
,;;
. ' ffi·liWHi·
. ' '
' ' a,t,SJ,7" ' S.t,Q.704 $ 1,721,91) $ .. ., .. ' 140,0Q
t,.ClltM $ J.ZJ0,704 ' 1,7U,tU ' u.,s, ' 140,oP ....,. .... ~,,. ... ..,,.
tii·ffM M
H, 2
. '
' ' ' ' 17,1171,ffi ' ~--$
$ 17,011,,U $ 5,.•9,&11 $
I 42.'1l, I 11.•" ....
.. .,, ·@MN iii· lffi
OloMAltallall S 2'17,JIC S IJ)l.\ffl S .1)341011 S 1)21,913 $ l,l,150 $ l40,Cl!l1 $ 17,P7J,Jtl $ 6,.9M,.&a7 $
~u,f:vr,de,dC.pl.fl
l'oOl!ot-Watallel!lhi~(OieflHdldan
c, ......
tn,Offi.r:MF!ftm:oun
AdJ.forMld'feulfKIHY
~•~U'CN.rJt,SfoirkMCN --Tu:"'""""'" ~•l!d'-illtt, -"~•ft\.111
Alles&.fotW!urH
lloc:ome~fl'"¥t,""""1,1nehb
ln!o,kp,"""nl.ll --OIM,01n,no;i,c:S¢auoc;e
Tol:illit.ta~•tokc..a.«..i
lk.11(,<11:ioNlol"AIAIIOtllltf'I"
OCTOBER 2019 I FINAL
...... .,,., --4,100,DOO C. &~
lJ)OOJXIO e. &Derund
f,t.llJJ~lt MAIOl!Mn I $
j Pla.nUnS.MCA! j $
..,.,..
tte,4,loo)
l&U.1~
(lOU(q
( ......
«l.60',071)
..,...,,
.... ..._ .... _,
""°""' "'-""""" ......... .........
A!.AI011htu .... _ ..........
AsMOlt11u .... -.
'
'
lDOO,OJ? 1C'K,,fi7 -04,U8 tU,'6l 4'368
91$,6,U l4C.tU 206)9' ~•,m 24,.)75
• s • $ • s • $ • s
• 5 • S • S • S • S • S
. s
. ' . '
1.,11,)"6 $ 1Q.N-.•~ ' o1,2R.tn ' p,»,m1 11,324,'511 (U6,316)
l,SQ!i,6U ' ,.~oo i l;l5',.tU ' I I
. ' . '
us:z.,.., ' """"' ......... ' .. I
. ' • $
l,J,s,tH ' (156,l") ..,,,_,., ' ,,.
. ' . '
,,...,. ' .....,,, ,..,.,, ' .. I
• 5 f'I .• A-6')
. ' . '
. ' • $ lOl.,,GJ)
s an.no,
17,COJ,,Hl ' 6,1189,.a&l ' (5,$61,10,)
(2.GS«i,Z,Z) 1--.n,1 $.J4),JCl9
U.OlJ,161 s ,,_,, $
"" I u• ..
Nov. 19, 2019 Item #16 Page 117 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Appendix G
RECYCLED WATER FUNCTIONAL ALLOCATION
CUstomff/S•!'Yke;
Custom ff/Source
ServlceOnty
(U$tOmetOtlly
V~ableOnly
Ju.AJ!Othff$
Pl.Int In S.MCe
Recyded Mlins
Ritc:y<:lcd Wat et Stationi
Recycled Watu hcillty
Const.ruction In PrOJfl!'SS
Ph11nt-ln•$•rvke Sub Toto,J
R.111Jocation of•~ All ~hen.•
Tota,Alloutkln
R~lng Al!ocations
R•c,cl,HI Wat•r Opuatinf Exp•nd/tutt$
Personnel
Reg sat.IMS
lnc:•nti'M P~y
Othcf'Penon,i,cl
100 Wof'ker's Comp
Ovfflime S..tlrles
Sundbyhy
,,.~!Sala,i~,
Elected Ofr11eia1s' Sa!ariu
TemprolfY ~
HHlth lnswance
LJfe lns1.m1nce
Vision Jnsunnce
Cell Phone Allowance
l\utoAl1omnce
Ea med Leave ActrUII
'1Hlthy EmpAw,uds
Fll'lll Vacation P.iy
F'mel sack leave P¥'/
OlabRity
UJ'MmpfQyrTHJnt
WoJter's CompeM1tlon
PERS
PERS-Repayl'l\e.flt
one Exii«~e
Soct•I Security
Deff.redComp
Def C.Omp M;atc;h
Other Personnel
Co.n A»clototlon Bas/J LI __ ..,:fYE..:.:.:20::;20::...._----1
Fbc•d Chor~ J£mmod.:ty Chorg~ I
""' ""' "" ""' """ "" """' "" ,_ "" App#u :c vo,.lll'l,,,ie /urittfons, f:':;:~::::/::a:~_!::::.gM, lt«m~~-----1 r----~-----~----~-_.:; """' "" "'"' "" .,,. "" ""
42,11$,946
8,220.212
14/~Sl,103"
6S,290,260
65,290,260
1,009,950
,,.,.. ·-
S,,00
l9S,343 .. ,
lS,24-0
J80
l.3SO
5,338
10.277
2,615
23,710
125,33$
131,517
500
Sctviceorw
S.f\lfieeOtw
S.,,,,ic.'tfflN'
Senoke-Onlv
Senol~Or'lhl
SetvluOnl\t
Scf'\llc:9'0nlv
S.Nlc.Ontv
S.Mc.Onlv
~lce-Onhr
S.niiceOnlv
S.NiteOnll/
Scni!ceOnt,,
Custom.rOnlv
CustomerOnlY
S.rvkeOnlu
S.rvluOl'lv
Service Orly
Scrvlc•Orfv
S.rvi~Orh
Servl~eOriv
SeMceO,._,
ScMciti Oriv
V1nlbleOnly
Vui1W..Onl\t
S.MCeOriv s.-n~,
s.--
Servict:O.riv
s $ I "' I
380
\,350
100!1 "" "'"" "" ,..,. "" ""'" 42,113,946 s 23,171,314
42.lUl,9415 s 23,171,314 s
"" I "" I ""
1,0)9,950 $
1:7,344 ·-
S/100
195,343
"'
15,244
5,338
10,277
2,us
23,710
12S,33.S
131,517
500
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 118 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Mainteaanee & Equipment
Off!e4 [qup Rent.al
Other Mach & E~
MlscRentab
Mlschues
Office Equ!p Mairv:«141ra
Software Maintenance
VehlcltMIW,t
WHh.JndWu:
Other Equip ~!ntemnc-e'
Rol.AA)e &ulldlnc Malnte.mc:e
Asphlh: Repairs
Mltinte.rpnee, Repair ilndRehlb
Audit
letal
Administntive
Cliilrm:Admin
Mhc Profession,) Services
Endnos..vlo,s
EncW SHvices {Pension Pa-yoff}
CityGener.Jted
M~IMOUS Ou.tslda Stfvices
Book 8Wldif11
Regu'lttory/Pe<mlttingfff1.
Mlsc:Servi'~
MWO/CWA F"u:ed 0.rge:s
Laundry u,d Uniform Malme.ara
£.lectrkaVSCADA ~le:~
Landscapincser-AO!s
Ads and P\t,1$hirc
Oun tine! Subscriptions
Books o11nd Publlc:.1tions
Audlo-Vlwal M•lffllls
Prlntlnr
Post•&e
Office 5tlppltes
Office Ft,niture & fqu'pment
Computer Softw.are-
Misc, Comput•r Klrdw.a,e
Promo Materllls
P,esc:hoot
Heat 11nd Light
Telephone & Communicalions
W.asto Ol~po;i,I Si::1"111~
Water
Ndlrw,M.ilnteNince
Electric.al Supplies
Julitorial Supplies
Parts.-fqulp
Roctand1Mlntn1 Product$ ........
Smalt Tools
Saft?V E(l(Jprnent
Uniforms and Acte1$0rit!
Mctcrl/Fttil"I&'$ • New
Mete(V'Flttlnp • Rephttt!m.nt
Ffrt! HoH and Appliances
Rescue Equipment
PC1"sonal Protktive Equipment
Brcalhinc Apparal\1$ Equipnw:nt
ShootingRanaeS1JPPIIH
Gasolfn• arid 01
CMWD Pure Water-Outsfck! Al,enc:y
CMWO Purch Water•FIOffl City
MlscS1..if'Pies
EmployH Tr.ilnlng
TuitlonA.flmbuNement ,
Tr.ainlrc/Tulnifll. Rel.lted T~v~
Prop Toes PD
Confem-a/Mn tinf:T~-..1
MJsc..Me.ats/WM
&.Id Otbt &p• Other Inv/Bills
Reg Over/Short
PrtorPeriod~tmtnt
Repayments
lnte:re:ston~poslt
M[Sc: Expe:,idtur~s
Vehicle Direct Ch;,tge-s
Vehl'clt> MalntHnc.
Vt!liCit> Repl.ac:etrlt!'nt
SueetUghtlnc
MNfl;an M1Jntenace
~MnlUab
Record,: Man.:igemeJ1t lntetdept
tnlorm.:itlonTCCMOloglcs
Misc lnt@rd@partrnt-ntal Chuees
Mis a.Back
Utility &IIK"l Chirieback
Other
AdditfoNI Maintenance & Equipment
OCTOBER 2019 I FINAL
S00
22,400
S00
S00
1,000
1,000
3,243
86,000
lfo27,0B7
188,0CX)
3,000
3S,OOJ
22,000
8,500
500
4,000
1,000
1,000
2,500
S.000
2.000
2,500
180,000
12,000
4,500
S00
66,500
1,000
1,000
600
1,900
3,000
15,0IXI
20,000
2;1.00p;xJ
18,000
7,000
""
u.sco
2,SCO
2,500
1,000
8,000
23,300
12,0715
29,150
102,912
421,128
(375,303 )
Variable Only
VarllbleOnly
Variltia.Onl
Varilble:Onl
Varilbk-Only
Variable On!
Vairllb5eOnly
VarilW.On!y
VariltNOnly
VarllbleOnl
VarllW.Only
VuJlbleOnl
Variable Only
V,11riabte-Only
Val'RIW.Onl
Varilbtt:Only
Vart.br.eOnl
Varilble Onl
ValilbleOnly
v~nableOnlv
VarfableOnl
VaN!bfeOnlv
~rfableOnl
VarfableOnl
VariableOnlv
VarfableOn}v
V;,rfabl41Onfy
Vari;11bl4Onlv
Custome,~
V.arllbleOnl
V.ariaWeOnlv
VaNlblcOnl
CUSlome{ unru
Customer<-
Varf11bleOnl =-~· CU::510me<°"""'
CllstofMfn......
Cu;tomel'"unN
V1rfableOnly
V.1rfableOnfv
V.u1ableOnly
Vulable n..,.,
V.at11ble()n1y
Va~bJ•r-
V,ui,1ble Orly
Vart.1bleOntv
Viltlablef\M,
Vilfiab1e.--..
Vari.able. UNV
Variable Only
V1riable0Ny
Variable[..,.,
Vuiabl.'"'"""
Cunomer Only
Customer Only
ServlotOnly
ServiceOnlv
V;ariabee n.w
VarlitHOnfrw
VeritbleO~
varwblcn...i...
V.1riabl. UfllV
Varilt.Onfv
Varbblftn..i..
V•fllbkOnlt,
cunornerOnlv
Customer Ont
Variable Only
Custom1trOntv
V,1riaWeOnly
Custom.-Ontv
CU5.tomerOnlv
AJAIIOthers
VarfabteOnlv
Varf•bleOnlv
V-1riaibl0-Only
Varf.lbleOnlv
Van"1bleOnlY
VarfableOnlv
V1riabl4Onlv
Variable Only
Vulable :1n.1v
VutableOnty
Variable
VarlablennN
Ci.mr>merOnl'v
V,11rJabl0-LinN
Va,~b!en..1u
VarilbleOnty
Variableurw
Cust0«1er Onl
Varilble,,.,,.,
VarifbleOnho
s
,,000
8,SCO
500
4.000
1.000
1.000
2:,00
1,900
•.ooo
7µ:,J
"" ·~""
2,S00
2,500
29.lSO
15.000
20,000
500
'22,400
500
S00
1,000
1,000
S,241
86,000
1Rl.7P87
188,000
30,000
;s,000
22,000
5,000
2µ:,J
2:,00
180,000
12,000
4,500
S00
'6,500
1,000
lµxJ
600
8,000
23,;oo
12,.076
102,912
421,118
(37S)03)
Im:1111
™
1.000
Nov. 19, 2019 Item #16 Page 119 of 158
Caplbl Outi.y
Noll>-&uds..ted Cap fqulp<SlOk
C.1pita1 CM.11y <SIOK Ne.w
C•pOutlay • Vehkle-1
Cornp,ttt Eqiatp > $1<>: -Repl
Offiee EqufptMn1.
Othe.r equiprntr'lt
Cap(~liaclAiH"ts
OpiU1 Projec.u
Othet Clpfhl Ouday
Other Fin1ndn1 Us.u
Othtt Other Anancq: Lfsas
Ope~un, (xpudit\;Ns Sub Total
ftullocadon of "As Alt Othws•
TotalAlocaOon
Optr.ittJll[~s
O.bt
Rate f\Clded C,pltal
Aepl11cement Functnc jDepHclatton F'wld!na)
T~Mfers to C.pl::al Reserve
C.shFlows
btu PIDtttier RtfflMI
0¥MNndtr Co1Kt'°'1 0Ut1Wru.1u
-odJu•""""
0/fstttiillg R.Ky<hd Wotu R~WIW~S
AdJ.forMJdYnrlraeue
Non-R•~• ChtlJff Jor Stnrn;ti
~loperfees
lme,gowmmenul (CWA)
FinM and Fo.rfett~~
lncorM from Property & l~stl'l'lents
lnt~i:partmcMII
OlMr FTNndflC5o11<H
Totilll ltlle hv-et11.1es to be-Collected
RHllonllon of "'As All Oth•n•
Totaa~atlon
"""'
"''"
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
V•rilbleOnlv
v,r1ai.on1y
50,000 V,1NbleOnlv
Varilbk-Onlw
V1t11b&I-Only
Vartabl•Ol'llv
Ylrili~Ol'llv
VarilbleOnlv
'V1rJl~OnlY
V11'11bltOnly
6,426,033
6,&26,033 I---'==
l:,73S,36S 1--...:..:;== A,OlM
V•rilbleOnlv
VaNbltOnN
{•,l)OO)
{2SO,OCO
(150,000
(1'.2001
I
I
(92,1001
(2,000 I
1,no,soo
7,791)500
V1rilbh0nlv
Custom•rLINV
AsAllOtNrs
Varilblt:Only
NAJI Others
NAIi Others
MAl100ffl
AsAIIOthu1
NAllOthcn
AsAllOtt.rs
AsAIIOthars:
As All Others
/uAl!Othf!n
AsAllOthtrs
I
I
I
I
$
s
s
$
80,240 $
12.49
80,292 $
1.25% I
"'
80.292 ~$
,..,.,
IU,015)
61,171
's
's
;s
$
$
1,460,293 $
227.21
1,460,520 $
22.71" I
1,460,520
1,450,.slO
1211,SSO) i,.~.,. s ,.,. I
S0,000
4,184,460
760.22
.c,aas.220
76.02"
4,885,220
2,13S,36S
7,620,515
I
(1,140,333}
6,480,ZS-Z
'"'
$
$
$
$
1,000
(1,000.00)
··-
(859,597)
14.0CO)
(250,000)
(150,l)OO)
(13,200)
(1,370,197}
1,370,1'7
.,.
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 120 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix H
POTABLE WATER CUSTOMER ALLOCATION
Alloc.ction Yf'or I fYE 2020 .,. MFR NR AR IR
Cu~tomcr Stohstlcs Singh:-F-omi1y ,.,~111-Fom!ly Comm.rc1ol A9nc;uhurol lrttgohon ~uv
Number of Attt>unts
Number of MEUs
A,t,nualWate-rUsa1e-
Mu.Month
MnDay
Mu Hou,
SOCWA
De,al
Atloc:•tion 8.&SI$.:
Albc,1ted Customer Com
Allocation Bul-s:
AlloCilted Customer Costs
AllocatJon Basis:
Alouted Customer Costs
,\location Bask:
Alooated Customu Costs
Allocation aasts::
Albeated Customer Costs
Allocation 8asis:
Allocetod o.tstomer costs
Atlon tion Bu is:
Aloeauon Ba Sis:
Aloeated CustomarCom
Custcml!I'
8asc
MaxOay
Max How
SOCWA -· 0 ... 1
Fire
Teti!
OCTOBER 2019 I FINAL
24,716
27,845
3,320.201
347,70,,
32,547
S.S,99-2
2,755,.027
565,174
87" I Numbcrof.Atcount$'. I '24,716
$ 2,230,900
Number of ME Us j ""' 27,845
S,844,260
I Ann~I Water Usage-I 54" 3,320,201
2,020,318
S7"
Max Dav I ,,,541
$ !::173,659
57%
Mn.Hour I .. ,..,
$ 667,597
54"
SOCWA I ,.m}J21
$ 8,109,736
s,,.
Desai I S6s.114
$ 3,181,145
rtl.llYlberofM.EUs
2,230,900
2,020,318
1,.l73,6S9
687,597
8,109,736
>,844,260
3,181,14S
231247,616
1,.142
5,019
7O3,60S
68,691
4,136
7,497
647,705
55,900
.,.
1,142
103,W
"" 5,019
1,053417
U%
703,605
428,U9
7"
4-,136
149,152
7"
7,497
87,382
"" 647,70S
1,906,594
SS.900
3'14,641
103,111
428,139
249,152
87,382
1,906,594
1,0$3,417
314,641
4,042,436
1.706
8,390
1,249,080
128,900
9,314
J6,U2
1,114,040
135,039
'" 1.706
153,971
'"" 8,390
1,760,Sn
""' J..249,080
760,0S6
16"
9,314
llS,SGS
"" 16,882
196,769
"" 1..11410lO
3,279,304
"" 135.039
760,084
153,971
760,056
llS,86S
196,769
3,279,304
1,760,877
760,084
7,246,926
22
272
86,688
12,181
629
l.140
6S,689
20,999
"" 22
1,964
'" ,n
S7,193
1.40%
U ,688
SZ,749
LlO!I .,.
22,&al
1.101'
1,140
13,281
l.29"
65,689
193,364
1.93%
20.999
118,19S
1,964
52,749
22,682 u.isa
193,364
57,193
U8,19S
4S9,43S
838
4,520
&29,673
104,210
10,757
19,497
517,7S6
311..,887
'" 838
'""
948,753
"" 829,673
504,SSO
"" 1O,7S7
387,903
227,256
'°" S17,78li
1,524,162
""' 311,887
1,7SS,489
75,667
504,850
387,903
227,256
1,524,16'2
948,753
vssµ,
S,424,080
782
40,365
40,365
188,m
18&,S77
lH,S77
2',207
8-6,4U
6,189,248 cc:f
66l,696ccf
57,384cd
104,00S ccf
5,100.249 cd
1,089,000cer
'°"" 28,425
2,565,613
46,047
9,66',SOO
11)0%
6,189,248
l,766,112
100!<
S7,3MI
2.069,262
"'"" 104,008
1,112,292
5,100,248
15,013,161
1,089,000
6-,129,SSS
40365
188,Sn
2,565.613
3,766,112
2,069,262
1.212.292
1S,OJ3,l61
9,664,SOO
6,129,SSS
1ss.sn
401609,070
Nov. 19, 2019 Item #16 Page 121 of 158
Water Cost of Service Study I POTABLE ANO RECYCLED WATER RATE STUDY I CARLSBAD
Appendix I
RATE DES IGN ANALYSIS
First yeorofroteoi ustme~ IMSii,,iiNi!MriM• ii;i-Customer Service Fire Base Max Day M•• Hour SDCWA Desai -Allocated 2020 Revenue Requirement S 2,230,900 S 5,844,260 $ $ 2,020,318 $ 1,173,659 $ 687,597 $ 8,109,736 $ 3,181,145 $ 23,247,616
Recovered through Account Charges
Number of Accounts
Monthly Fixed Charge Per Account
Recovered through Unit Charges
Effective Number of MEUs (FY 2021)
Monthly Fixed Charge Per MEU
Recovered through Volume Charges
lier Limits (eel}
Tierl
lier 2
Tier 3
Tier Usage
Tier 1
Tier 2
Tier3
I
I
I
Volume Charge ($/ccf)
0
11
19
%
63%
22%
15%
100'¼
Tier Volume Charge perccf:
Tlerl
Tier2
Tler3
C c::a,,,...,,,..
I
I
I
I
I
I
UnnerUmit
10
18
999999
ccf
2,106,380
715,224
498,597
3,320,201
24,716 I
21,845 1
lier Peak Factor
1.06
1.32
1.73
I
100%
$ 7.52 $
$ $
s s $
100% 100'¼
17.49 $ s $ $
1 100% 100%
PeakingAllocations~l __ 34_% __ ~----~-21%
All Tiers
Tier l
Tier 2
Tler3
Tier 1
Tier2
lier3
$
$
$
$
1,144,897
1,144,897
63.44%
21.54%
15.02%
0.61
TRUE
0.61
0.61
0.61
686,938
686,938
55.2%
23.5%
21.3%
$ 0.35 $
TRUE
$ 0.31 $
$ 0.39 $
$ 0.50 $
$ s 7.52
$ s 17.49
100% 100% 100%
45%
1,488,366 2,755,027 565,174 TRUE
274,545 2,106,380
715,224 648,647 66,577
498,597 498,597
55.2% 76.5% 0%
23.5% 23.5% 11.8%
21.3% 0.0% 88.2%
0.21 $ 2.44 $ 0.96
TRUE TRUE TRUE
Rounded Rates
0.18 $ 2.94 $ $ 4.04
0.23 s 2.67 s 0.52 $ 4.42
0.29 $ $ 5.63 $ 7.04
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 122 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Multi-Family Residential (MFR) Customer Servlce Fire Base Max Day MaJ< Hour SOCWA Desai -Allocated 2020 Revenue Requirement $ 103,111 $ 1,053,417 $ 428,139 $ 149,152 $ 87,382 $ 1,906,594 $ 314,641 _s ___ 4,_04_z..,,4_36_
Recovered through Account Charges 100%
_N_um_b_er_o_f_A_cco_u_n_ts~(_FY_2_0_2~1)~------~----~1,_14_2~1 -------------------------------------------_____ _
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ 7.52
Recovered through Unit Charges .-----~ !._ ____ _.__-'1"'00%=--'----'1"'00%""'---'------'-------'---------'------'-------'
_Ef_fe_ct_i_ve_N_u_m_b_e_ro_f_M_E_U_s~(F_V_2~0_21~)-----~----~S,_01_9~1 _$ ______ $,-------,-----,-$----------------------,-----_____ _
Monthly Fixed Charge Per MEU 17.49 $ $ $ $ $ s 17.49
Recovered through Volume Charges I I I 100% I 100% I 100% I 100% I 100%
Tier Limits (ccf/DU)
ller 1
Tier2
Tler3
Tier Usage
Tlerl I
ller2 I
ner3 I
0
6
11
%
78%
22%
Total MFR Usage 100%
Volume Charge ($/ccf)
nerVolume Charge perccf:
nerl
ller2
T1er3
Upper limit
I s
I 10
I 999999
ccf
I 547,586
I 156,019
I
703,605
Commercial
Allocated 2020 Revenue Re9uirement
Recovered through Account Charges
Number of Accounts (FY 2021)
Monthly Fixed Charge Per Account
Recovered through Unit Charges
Effective Number of MEUs ( FY 2021)
Monthly Fixed Charge Per MEU
Recovered through Volume Charges
Projected BIiied Water Usage (eel)
Volume Charge (Sleet)
OCTOBER 2019 I FINAL
Tler Peak Factor
1.04
1.41
1.55
703,605
1,7061
s,390 I
1,249,oso 1
PeaklngAllocatlons~I ----~~----~----~ 87% I 13% I 13% I
All llers ccf
Tier 1
Tier 2
ller 3
Tierl
Tler2
Tier3
s
$
$
615,126
547,586
67,540
n.8%
22.2%
0.0%
TRUE
0.61 s
0.61 s
0.61 $
88,480 88,480
88,480
72.2% 72.2%
27.8% 27.8%
0.0% 0.0%
TRUE TRUE
0.21 $ 0.12
0.20 $ 0.12
0.27 $ 0.16
647,705 55,900
547,586
100,119 55,900
84.5% 0.0%
15.5% 100.0%
0.0% 0.0%
TRUE TRUE
$ 2.71 $ 0.45
$ 2.94 $
$ 1.89 $ 2.02
Customer Service Fire Base MaK Day Max Hour SOCWA Desai
-------------------------------------------$ 153,971 $ 1,760,Sn $ $ 760,056 $ 335,865 $ 196,769 $ 3,279,304 $ 760,084
100%
$ 7.52 $ $ $ $ $ $ $
I 100% 100%
$ $ 17.49 $ $ $ $ $ $
I 100% 100% 100% 100% 100%
$ s $ $ 0.61 $ 0.27 $ 0.16 $ 2.63 $ 0.61
TRUE
Rounded Rates
$ 3.87
$ 4.94
$ -$ 7,246,926
$ 7.52
$ 17.49
Rounded Rates
$ 4.27
Nov. 19, 2019 Item #16 Page 123 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Agricultural Customer Service Fire Ba,e Max Day Max Hour SDCWA Desai --------------------------------------------Allocated 2020 Revenue Requirement $ 1,964 $ 57,193 $ $ 52,749 $ 22,682 $ 13,288 $ 193,364 $ 118,195 $ 459,435
Percent Recovered Through Acccunt Charges 100%
Number of Accounts 22 1
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ $ $ $ $ 7.52
Recovered through Unit Charges I 100% 100%
Effective Number of MEUs (FY 2021) m l
MonthlX Fixed Charge Per MEU $ $ 17.49 $ $ $ $ $ $ $ 17.49
Reccvered through Volume Charges I I I 100% I 100% I 100% I 100% 100%
Projected Billed Water Usage (ccf) 86,6881 Rounded Rates
Volume Charg!,JS/cd) s $ $ $ 0.61 $ 0.26 s 0.15 $ 2.23 $ 1.36 $ 4.62
Irrigation Customer Service fire Base Max Day Max Hour SDCWA Desai -Allocated 2020Revenue Requirement $ 75,667 $ 948,753 $ $ 504,850 $ 387,903 $ 227,256 $ 1,524,162 $ 1,755,489 $ 5,424,080
Percent Recovered Through Account Charges 100%
Number of Accounts 8381
Monthly Fixed Charge Per Account $ 7.52 $ $ $ $ s $ $ 7.52
Recovered through Unit Charges I 100% 100%
Effective Number of MEUs (FY 2021) 4,s20 I
Monthly Fixed Charge Per MEU $ $ 17.49 $ s $ s $ $ $ 17.49
Recovered through Volume Charges I I 100% I 100% I 100% I 100% 100%
Projected Billed Water Usage (ccf} 829,673 1 Rounded Rates
Volume Charge ($/ccf! $ $ $ $ 0.61 $ 0.47 $ 0.27 $ 1.84 $ 2.12 $ 5.31
Fire Cuslomer Servite-Fire Base Max Day MaK Hour SDCWA Desai -Allocated 2020 Revenue Re9uirement $ 188,Sn 188,Sn
Percent Recovered Through Account Charges 38%
Number of Accounts 182.00 I
Monthll Fixed Charge Per Account $ 7.52 $ 7.52
Recovered through Unit Charges 63%
Effective Number of MEUs !FY 2021! 40,3651 Rounded Rates
Monthll Fixed Char,e Per MEU $ 0,24 $ 0.25
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 124 of 158
CARLSBAD I POTABLE, RECYCLED, AND WASTEWATER RATE STUDY I Water Cost of Service Study
Appendix J
SUPPLY ALLOCATION
Supply Allocation SDCWA Desai Total
Total Available for Retail (ccf) 5,100,248 1,089,000 6,189,248
Annualized Month Minimum Use
Remaining Available Before Allocation 5,100,248 1,089,000 6,189,248
Amount to be Allocated 4,822,916 4,822,916
Allocated Min. 3 Month Remaining
Single Family 2,611,096 2,611,096 2,611,096 2,611,096
Multi-Family 633,469 633,469 633,469 633,469
Commercial/Non-Residential 1,079,650 1,079,650 1,079,650 1,079,650
Agricultural 60,342 60,342 60,342 60,342
Irrigation 438,359 438,359 438,359 438,359
Total (ccf) 4,822,916 4,822,916 4,822,916 4,822,916
Remaining to Allocate 277,332 1,089,000 1,366,332
Annualized Average Use
Remaining Available Before Allocation 277,332 1,089,000 1,366,332
Amount to be Allocated 277,332 1,089,000 1,366,332
Less Previously
Allocated Average Month Allocated Remaining
Single Family 3,320,201 (2,611,096) 709,105 143,931 565,174 709,105
Multi-Family 703,605 (633,469) 70,136 14,236 55,900 70,136
Commercial/Non-Residential 1,249,080 (1,079,650) 169,430 34,390 135,039 169,430
Agricultural 86,688 (60,342) 26,347 5,348 20,999 26,347
Irrigation 829,673 (438,359) 391,314 79,427 311,887 391,314
Total (ccf) 6,189,248 (4,822,916) 1,366,332 277,332 1,089,000 1,366,332
Remaining to Allocate
OCTOBER 2019 I FINAL
Nov. 19, 2019 Item #16 Page 125 of 158
Water Cost of Service Study I POTABLE AND RECYCLED WATER RATE STUDY I CARLSBAD
Total Supply Allocation SDCWA Desai Total
Single Family Single Family 2,755,027 565,174 3,320,201
Multi-Family Multi-Family 647,705 55,900 703,605
Commercial/Non-Residential Commercial/Non-Residential 1,114,040 135,039 1,249,080
Agricultural Agricultural 65,689 20,999 86,688
Irrigation Irrigation 517,786 311,887 829,673
Total (ccf) 5,100,248 1,089,000 6,189,248
d1eck: 5,100,248 1,089,000 6,189,248
Single Family 54% 52% 106%
Multi-Family 13% 5% 18%
Commercial/Non-Residential 22% 12% 34%
Agricultural 1.3% 1.9% 3%
Irrigation 10.2% 28.6% 39%
100% 100% 200%
FINAL I OCTOBER 2019
Nov. 19, 2019 Item #16 Page 126 of 158
CITY OF CARLSBAD WASTEWATER BOUNDARY
PACIFIC
OCl:AN
----CITY OF CARLSBAD WASTEWATER BOUNDARY
EXHIBIT 5
Nov. 19, 2019 Item #16 Page 127 of 158
PACIFIC
OCEAN
----CMWD BOUNDARY
NOT TO SCALE
EXHIBIT6
Exhibit 7
Nov. 19, 2019 Item #16 Page 128 of 158
To City Clerk:
RECEIVED
OCT 3 O 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
I am a property owner of Carlsbad, 90029. I am protesting the
proposed rate increases. The increases will put a real strain on cost of living for my
family. We are pleading with you to not increase the rates. My husband and I are
both hard-working individuals and find it difficult to pay mortgage and bills to live
in this area. Please, please do not increase the rates.
Thank you for understanding.
Best,
0:--~
Erin Esko Coha
Nov. 19, 2019 Item #16 Page 129 of 158
To City Clerk:
I am a property owner of Carlsbad, 90029. I am protesting the
proposed rate increases. The increases will put a real strain on cost of living for my
family. We are pleading with you to not increase the rates. My wife and I are both
hard-working individuals and find it difficult to pay mortgage and bills to live in
this area. Please, please do not increase the rates.
Thank you for understanding.
Bes~~~
Aluphen Coha
Nov. 19, 2019 Item #16 Page 130 of 158
Nov. 19, 2019 Item #16 Page 131 of 158
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OCT 3 0 2019
,-CITY OF CARLSBAD
CITY CLERK'S OFF/CE
:
I
Nov. 19, 2019 Item #16 Page 132 of 158
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CITYOFc
1 CITY CLEBK~~~~E .. "j
I
Nov. 19, 2019 Item #16 Page 133 of 158
Sonia De La Fuente
Carlsbad CA 92029
October 24, 2019
City Clerk's Office
1200 Carlsbad Village Drive
Carlsbad, CA 92008
City Clerk of Carlsbad,
Subject: Protesting the Proposed Rate Increase.
RECEIVED
OCT 2 B 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
I attest I'm the owner of this parcel and as the property owner of 2808 Atadero Ct. Carlsbad, CA 92009 I
protest this rate increase.
Sonia De La Fuente
Nov. 19, 2019 Item #16 Page 134 of 158
Office of the City Clerk
City of Carlsbad
RECEIVED
OCT 2 S 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
Craig Arterburn
Carlsbad, CA 92008-4319
October 24, 2019
1200 Carlsbad Village Drive
Carlsbad, CA 92008 Re: Protest of Proposed Water Rate Increases
Carlsbad City Clerk and City Council:
I write in protest of the residential 5/8 inch meter size rate increases for January 1, 2020 and 2021.
Pertinent information regarding my parcel and account:
1. Parcel Number
2. Account Number
3. Meter Number
4. Meter Size 5/8 inch
I'm protesting the proposed water rate increase for the following reasons:
1. I am on a fixed retirement income where annual COLA increases don't come close to
mitigating increases in any of my utilities.
2. Other than possible replacement of aging and/or failing infrastructure within the water system,
I don't see any benefit to the increase.
3. Operations and maintenance costs shouldn't change significantly to require an increase-
especially twice in two years.
4. The city already requested a 1.1 % trash collection rate increase in 2017 ( effective 2018?), and
now another increase is being requested for 2020 through FY 2021-22.
5. Past Governor Moonbeam's outrageous fuel and vehicle registration tax, rammed through the
corrupt state legislature without a vote of the people, is still costing us hundreds of dollars each
year.
With the exception of #2, the rate increases reek of a clandestine way for employee pay raises. On
my fixed income, I 'm not keen on helping to pay for other peoples' mortgages, car payments, and
kids' college tuition. When does it end? When will COLA ever match actual real inflation? C•z;~
CRAIG ARTERBURN
Nov. 19, 2019 Item #16 Page 135 of 158
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-_;-f,._;--;:: /fr>} V7o_,d/ ~ A-CL-u: . /. '':;?
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c:? r~ I/ v'--). (A_y w .4-ft ! r I .e~, -4'
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5 :rv ~ ,1,,,,.c) lJ,_r1,,, f::' y di1 So {/ t!,R) /JINc;4)
?~~~wCVL~
~ Ms. Patricia Haueen
.. l,clrJSOaa, CA 92011
Nov. 19, 2019 Item #16 Page 136 of 158
\o : 6 k\, ~ t G--v \-s\-,
Fv~: M<lA-'1l~ ~c
RECEIVED
OCT 2 8 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
Nov. 19, 2019 Item #16 Page 137 of 158
I
-)-.:>
\ o \ ·-z_ o ) l ~
I
RECEIVED
nrr 9. d. ?OtQ
r.1TY OF CARLSBAD
CITY CLERK'S OFFICE
Nov. 19, 2019 Item #16 Page 138 of 158
I I
I
-,~
. >
''!
' .
ClTY OF C . .
CITY CLERK'S OFFICE
Nov. 19, 2019 Item #16 Page 139 of 158
Maria Bucci
Carlsbad, CA 92010
10/11/2019
Dear Office of the City Clerk,
RECEIVED
OCT 1 7 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
I am a resident and property owner in Carlsbad, California and am submitting a formal, written
protest to the rate increase of the Proposed Maximum Potable Water and Wastewater Rate.
Sincerely,
Maria Bucci
J_
___ ,,_-----------------------------
Nov. 19, 2019 Item #16 Page 140 of 158
October 9. 201"'
Office of the City Clerk
Citv of Carlsbad
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Dear City Clerk,
RECEIVED ·
OC1 1 5 20l9
CITY OF CARLSBAD
CITY CLERK'f' OFFICE
Patrice Danaher
Carlsbad, CA 92010
I am protesting the residential rates the City Council plans to approve at the public
hearing on Nov. 19, 2019. My parcel number is The specific rate
changes I am protesting are the Monthly Potable Water Delivery Charge proposed for
1 / l /2020 and 1 / l /202 l; and Water Usage Charge proposed for 1 / l /2020 and
1/1/2021.
Sincerely yours,
~~
Patrice Danaher
Nov. 19, 2019 Item #16 Page 141 of 158
TO: Office of the City Clerk, City of Carlsbad
1200 Carlsbad Village Drive
Carlsbad, CA 92008
RECEIVED .
OC1 15 20,9
CITY OF CARLSBAD
CITY CLERK'S OFFICE
I am writing to protest the Proposed Maximum Potable Watercruu vvastewater Rate increases. The
rate change I am protesting is Monthly Potable Water Delivery Charge for Parcel number
My account number is Account It is going from $24.72 to $25.02 on
01/01/2020 and $25.52 on 01/01/2021.
I am also protesting the Water Usage Charge going from $3.94 to $4.04 on 01/01/2020 and $4.13
on 01/01/2021
Si d
Carlsbad, Ca 92010
Nov. 19, 2019 Item #16 Page 142 of 158
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~
~I
\
/b -q·-19
RECEIVED
OCT 1 5 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
Nov. 19, 2019 Item #16 Page 143 of 158
~o ~
~ I 'f .:l._ t' 0 ~
RECEIVEu
OCT 1 5 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
~ ~_,(0,-,. ~ L__F;-y-...J..../0 " ..
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~
Nov. 19, 2019 Item #16 Page 144 of 158
October 10, 2019
Carlsbad Municipal Water District
Office of the City Clerk, City of Carlsbad
1200 Carlsbad Village Dr.
Carlsbad, CA 92008
To Whom it May Concern,
This is a letter to submit a formal protest to the proposed fee change.
Protester:
Parcel Number:
Current Owner: Lisa A Jenkins
Carlsbad, CA 92008
RECEIVED
OCT 15 2019
CITY OF CARLSBAD
CITY CLERK'S OFF ICE 1
Nov. 19, 2019 Item #16 Page 145 of 158
October 13, 2019
RE: WATER RATES INCREASE PROTEST
RECEIVED
OCT 1 5 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
I protest the rate increase to water A~D wastewater residential rates which will be heard at the Public
Hearing on 11/19/19.
Thank you,
James Brown
Carlsbad, CA 92008
Nov. 19, 2019 Item #16 Page 146 of 158
\ide,;t fUo1)<e
. f.< a.t< c~"'~ ~ ~ proh 14 : oil rqtt
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l L , L 1 o LP ~ 1 IL J iut 1
OCT O 7 2019
crrv OF CARLSBAD -
CITY CLERK'S OFF!C£__
M
Nov. 19, 2019 Item #16 Page 147 of 158
; Watec Bat" lncre
To Gcity of Carlsbad) CC/BCC Bl ■ m
Water Rate Increases 3 De..+ :;N)f 9
We are protesting the proposed increase for Carlsbad water and
wastewater rates. We are retired and on a fixed income and feel
that should be considered when proposing such an increase.
~~
Cherie Mclarty
Michael R. Mclarty
c:-:, B I M •..
RECEIVED
OCT O 7 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
ii
Nov. 19, 2019Item #16 Page 148 of 158I /v c.i'< e.A>lf I <, i, /( l(S e. _17',y-WI/ fc ~ j ~ ct~ ":f IL r + , ,,__, ( µ , v< ,d ,_ /!-, 7-r ~ ;/ ,,cJ ,~-cl) . . /-j r--t1 _.L cl O ,,,v" T l( S" (? ,/'?"'?1 lt r✓\ (_t.;~e t<. ~ ft:~ ~-Tari, c,'9ee/4l_ C /V t:t ( ( -rx t t'V_Ji-5 R. e ; J7v ~ c:. c Ct 4;-s a.r(.. t-#" . _ A_ f/•~f'~s-ecf 0 c~ ~;3: A'<ST f.~ f<Q,:t~c-f-c~(,, ::r ~ o L~ a~J. c.N l rr-,hA ve S-oc:1cJ. S't!cu,e,~ P0tz-/7Y\ ()--;rJ c~ ... ,r Jl L ( ';::. t L> CL ' II E"ff. y ±/ ,=-F-J-M u /\-.1e j-e,'--, s e --' _4-, --. -~ -.---~~ ---. ----·-----.., • • • -. • - • . 4 _;l°r.'" 1 ___ , ************·········••\ Ms. Patricia Haugen Carlsbad, CA 92011 --.........•............
Nov. 19, 2019 Item #16 Page 149 of 158
City Clerk
City of Carlsbad
1200 Carlsbad Village Dr
Carlsbad, CA 92008
RE: parcel
To whom it may concern:
Water rate increases
RECEIVED
NOV -6 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
November 2, 2019
This is a formal protest to the rate increase to the water usage and delivery charges. I am opposed to
these rate increases because I think the charge is already too high. We are already trying to save water,
not using any excess and still paying too much. I hope this proposed increase does not go through
because it will affect us too much financially.
Sincerely,
Carlsbad, CA 92009
Nov. 19, 2019 Item #16 Page 150 of 158
RECEIVED -,
NOV -6 2019
cT{y~ OF CARLSBAD
I LERK'S OFFICE I
1 l-I -~019
J~a.r S ~ ' / Jf\o.6°'-lfh J
-=r: wo'-"-\d. \ ·,\(e_ -\--0 ~k +k\----=r-pro+e~\.-+~~ 1
p , Df o s.ed r-o. ~ -, 1' c. i' e.°' se.. , Y°Y'd no. v'A-<2... ; 'i:i
. fY'-0-" pv-e.,,_ \-~ ¼ !""'Ao..>" 'f\ , , N\~ ~e. r V i U/... a_J J I"~ S
~ &, \ s b c..c:\ , C Pi C? ::i co1
\ ~ a. Y\ \c ~"'-v-..., .
Nov. 19, 2019 Item #16 Page 151 of 158
City of Carlsbad
1200 Carlsbad Village Dr
Carlsbad, CA 92008
October 30, 2019
Re: Water rate increases ,
To whom it may concern:
RECEIVED
NOV -6 20'9
CITY OF CARLSBAD
CIT'< CLERK'S OFFICE
I am writing to formally protest the rate increases you are proposing to the water usage and
delivery charges. I do not think you should be charging more than you are charging already. The
rates are already too high. Please rethink these rate increases because they will affect a lot of us in a
very negative way. Thank you for your attention,
Susana M. Cuellar
Carlsbad, Ca 92009
Parcel
Nov. 19, 2019 Item #16 Page 152 of 158
RECEIVED
NOV 1 2 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
08 Ocrnbrn 20 l 9
PROTESTING THE INCREASE IN WATER RATES
MuNicipAl WATER DEPARTMENT
I AM THE OWNER of PARCEL NUMbER
I AM pROTESTiNq THE iNCREASE iN WATER RATES foR OUR l ANd ½ iNCH METER SERViNq A
COMMERCiAl pROpERiyy.
SiqNiNq foR THE HFM TRUST ANd THE MKM TRuST.
Nov. 19, 2019 Item #16 Page 153 of 158
RECEIVED
NOV 1 2 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
08 Ocmbm 20 l 9
PROTESTING THE INCREA5E IN WATER RATES
MuNicipAL WATER DEPARTMENT
I AM THE OWNER of PARCEL NUMbER
I AM pROTESTiNCj THE iNCREASE iN WATER RATES foR OUR 5 /8 iNCH METER SERViNCj A COMMERCiAL
pROpERT)I.
SiqNiNq foR THE HFM TRUST ANd THE MKM TRusT.
Nov. 19, 2019 Item #16 Page 154 of 158
RECE\VED
NO\J 1 2 20\9
CARLSBAD
C\i'< O~RK'S OFFICE. C\i'< CLt:e
08 Ooobrn 201 9
PROTESTING THE INCREASE IN WATER RATES
MuNicipAl WATER D EPARTMENT
I AM T~IE OWNER of pARcEl NUMbER
I AM pROTESTiNCj THE iNCREASE iN WATER RATES fOR OUR 1 iNCH METER SERViNCj A NON-RESidENTiAl
iRRiCjATiON pROpERl)f.
SiCjNiNCj foR THE HFM TR usT ANd THE MKM TRUST.
Nov. 19, 2019 Item #16 Page 155 of 158
RECEIVED
NOV 1 2 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
08 OcrnbER 2019
PROTESTING THE INCRfA<iE IN WATER RATES
MuNicipAl WATER DEPARTMENT
I AM Tl-IE OWNER of pARcEl NUMbER
I AM pROTESTiNCj Tl-IE iNCREASE iN WATER RATES fOR OUR 2 iNCH METER SERViNCj A SiNCjlE fAMily
1-iOME.
SiCjNiNCi foR THE HFM TRUST ANd THE MKM TRusT.
Nov. 19, 2019 Item #16 Page 156 of 158
RECEIVED
NOV 12 2019
CITY OF CARLSBAD
CITY CLERK'S OFFICE
08 Oaobm 201 9
PROTESTING THE INCREA5E IN WATER RATES
MuNicipAl WATER DEPARTMENT
I AM THE OWNER of pARcEl NUMbER
I AM pROTESTiNCj THE iNCREASE iN WATER RATES foR OUR 2 iNCH METER SERViNCj A SiNCjlE fAMily
HOME.
SiqNiNq foR THE HFM TRUST ANd THE MKM TRUST.
Nov. 19, 2019 Item #16 Page 157 of 158
/\II Receive -Agenrl.;; Item # ~
For the Inform; : , ;11 of the:
CITY COL: .• It.
Date \\ \ \~ CA )0 CC .::f2_
CM ..1,COO 'P DCM (3) ;._.-----,
Office of the Ci~y Clerk RECEIVED
City of Carlsbad!: NOV l &. 2019
1"200 Carfsbad 'Village Dr.
C I b d CA 912008 CITY OF CARLSBAD ar s a ' CITY CLERK'S OFFICE
Dear City Clerk,,
r protest ttie pro,posed Tier 1 sfngre famffy rate that fs currentry
at $3.94/unit prclposed TO $4.04/unit effective 1/1/2020 as well
Yne proposed "T() $4.21/unit effective 1n12021.
,tiry· rrame 1s J'ac:que~ne Srmon and i rrve at
, Carlsbad, C~A 92011. Parcel #
Parcer #
Nov. 19, 2019 Item #16 Page 158 of 158
P-ecei ved \ \-\9-\ ~
~ ~ RR,C<Jrci.
Reclaimed water inequality in
city of Carlsbad
My concern is the lack of progress being made to bring reclaimed
water to all the citizens of
Carlsbad. I have lived in the Alicante Hills HOA for five years now, and
our biggest expense is our
water bill. By not having the reclaimed water and the benefits of the
cheaper rates we lose roughly
$10,000 dollars per year, $50,000 in the five years I have lived here. Why
have my tax dollars gone
to benefit some areas that enjoy the cheaper rates while others are paying
the high costs of non reclaimed
water rates. You don't treat other city services such as fire,
police,gas,and electric that way,providing
for some and not for others. I propose that all citizens should be given
the benefits of the reclaimed water
rates or none do, why should some benefit with the savings provided by our
tax dollars and others do not.
If the city had made constant progress to provide for all you could justify
the wait,but this is not the case
I propose that by charging those who have the reclaimed water benefits the
same amount that those who do not,
the excess profits could be used to bring the reclaimed water to all, and
then allow everyone to reap the
benefits of the reclaimed water rates, or start giving those who have
helped fund the advantages of the
reclaimed water the same low rate.
Respectfuly, Dave Allen
Carlsbad, CA
Nov. 19, 2019
All Receive -Agenda Item # _UR _
For the Information of the:
CllY COUNCIL
Oate iW-cA ~cc':f_
CM ¥1-COO ~ DCM (3) ~
Council Memorandum
To: City Council and Carlsbad Municipal Water District Board
From: Vicki Quiram,.Utilities Di_rector/General Manager
Via: Paz Gomez, Deputy City Manager, Public Works
{city of
Carlsbad
Re: Additional Materials for the Nov. 19, 2019 Council Meeting Regarding Staff
Report Item No. 16 -Public Hearing for approval of a potable water rate
structure modification and proposed two-year rates for potable water, recycled
water and wastewater.
This memorandum provides additional materials for the Nov. 19, 2019 Joint City Council and
Carlsbad Municipal Water District Board Meeting related to Agenda Item No. 16, Exhibit 3,
regarding holding a public hearing for water rates. The information in the published materials
overstate the current and proposed monthly recycled water delivery charge rates.
In Exhibit 3, the published materials state the current and proposed monthly recycled water
delivery charge rates are:
Monthly Recycled Water Delivery Charge
Two Year Rates
1/1/2020
Current Proposed
Meter Size:
5/8" $ 23.69 $ 23.69
3/4" $ 32.69 $ 32.69
1" $ 50.70 $ 50.70
1.5" $ 95.73 $ 95.73
2" $ 149.75 $ 149.75
2.5" $ 212.84 $ 212 .84
3" $ 275.90 $ 275.90
4" $ 455.93 $ 455 .93
6" $ 906.18 $ 906.18
8" $1,446.47 $1,446.47
10" $2,076.82 $2,076.82
Joint Carlsbad Municipal Water District/ Utilities Department
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 t
1/1/2021
Proposed
$ 23.69
$ 32.69
$ 50.70
$ 95.73
$ 149.75
$ 212.84
$ 275.90
$ 455.93
$ 906.18
$1,446.47
$2,076.82
Carlsbad Municipal Water District Board
Nov. 19,2019
Page 2
Exhibit 3 should state the current and proposed monthly recycled water delivery charge rates
are:
Monthly Recycled Water Delivery Charge
Two Vear Rates
1/1/2020 1/1/2021
Current Proposed Proposed
Meter Size:
5/8" $ 23.34 $ 23.34 $ 23.34
3/4" $ 32.22 $ 32.22 $ 32.22
1" $ 49.97 $ 49.97 $ 49.,97
1.5" $ 94.35 $ 94.35 $ 94.35
2" $ 147.59 $147.59 $ 147.59
2.5" $ 209.77 $ 209.77 $ 209.77
3" $ 271.92 $ 271.92 $ 271.92
4" $ 449.35 $ 449.35 $ 449.35
6" $ 893.11 $ 893.11 $ 893.11
8" $1,425.61 $1,425.61 $1,425.61
10" $2,046.87 $2,046.87 $2,046.87
As the cost of service study did not rely on the overstated rates, the error did not affect the cost
of service study results. Therefore, staff continues to recommend there be no increase in
recycled water rates for calendar years 2020 and 2021.
cc: Scott Chadwick, City Manager
Elaine Lu key, Chief Operations Officer
Celia Brewer, City Attorney
Public Hearing for
CY2020 & 2021 Utilities Rates
Vicki Quiram, Utilities Director
Ligeia Heagy, Utilities Department
November 19, 2019
Requested Action
•Adopt the proposed calendar year 2020 and
2021 utilities rates.
2
California Proposition 218
•Overview –Majority Protest Public Hearing
•Schedule
–Sep. 17, 2019: Set the majority-protest public hearing date for Nov. 19, 2019
–Oct. 1, 2019: Mailed the Notice of Hearing (minimum 45 days ahead of
public hearing)
–Nov. 19, 2019: Hold majority-protest public hearing, set rates
–Jan. 1, 2020: Implement new rates
•Protest process
3
Utilities Cost of Service Study
•Carollo Engineers, Inc.
•Objectives:
–Ensures charges are aligned with the cost of
providing services
–Comply with Prop 218, state constitution, and
legal requirements
4
Potable Water Revenue
5
•No rate increase for last two years
•Revenue increase of
–1% for CY2020, and
–2% for CY2021
•Increase primarily driven by:
–SDCWA and MWD increases –cost of water (55%)
–SDCWA capital improvement program
–Demand changes
Potable Water –Rates
6
Potable Water -Single Family 5/8ths Meter -Delivery Charge History
$30.00
$24.72 $24.72 $25.02 $25.52
$25.00 $24.11
$21.08 $22.19
$20.07
ov $20.00 ~
n;! ..c u ~ $15.00
,v
.::!
Q)
o $10.00
$5.00
$0.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Water Rate Comparison –Single Family Residential
7
Regional Monthly SFR Water Bill
$140
$120
$100
iii $80 r: r· .. .. ,1""1 r , ..
> :c .... $60 c:: 0 ~
$40 I
$20 ' $-.. . . . . ... . . . . . . . .. . . . . .. . .. .. . •
• .. .. • -Fixed Charge
-Commodity Charge
--Regional Average
Recycled Water Revenue and Rates
8
•No revenue increase recommended
•No rate increases proposed
Recycled Water –Rate History and Value
9
$6.00
$5.00
41 $4.00 ... ro ci:
u ·;:
; S3.00
E ::,
g $2.00
$1.00
$-
Volumetric Charge -Recycled Water Rate vs. Potable Irrigation Rate
$4.15 $4.22
$3.85 si.so ......... . .......... S3.53
$3.27
2011 2012 2013 2014
Recycled Water Rate -Potable Irrigation Rate
$4.44
2015
$4.67
2016
Calendar Year
$5.03
2017
S5.16
······ .....
$3.79
2018
S5.16 ··········· ················
$5.31 ....... ?.?·41
·········
$3.79 $3.79 $3.79
2019 2020 2021
......... Linear (Recycled Water Rate) ......... Linear (Potable Irrigation Rate)
Wastewater Revenue
10
•No increases for the last 4 years
•Revenue increase
–3% for CY2020
–3% for CY2021
•Increased costs associated with Encina Wastewater Authority
–CalPers pension obligation -100% pay-off over 3 years ($4.1M)
–Capital Improvement Program ($95M –over the next 10 yrs)
•Inflation (chemicals and energy)
•Wastewater CIP (asset management plan & SCADA)
Wastewater –Historical Rates
11
Wastewater -Single Family Fixed Monthly Charge
$30.00 $29.52
$29.00 $28.66
QJ $27.81 $27.81 $27.81 $27.81 ~ $28.00
~ u
2!:-$27.00
~ $26.03 .... C:
~ $26.00 $25.52
,:,
QJ $25.00 .2:S u..
$24.00
$23.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Wastewater Rate Comparison –Single Family Residential
12
$160
$140
$120
$100
$80
$60
$4o I s211s~
$20
$-
Regional Monthly SFR Wastewater Bill
.~111 11 1111
-Commodity Charge
Example of Monthly Bill Changes
13
Current Bill Proposed Bill
(Jan. 1, 2020)
Proposed Bill
(Jan. 1, 2021)
Potable Water $68.81 $69.84 $71.33
Wastewater $27.81 $28.66 $29.52
Total SF Residential $96.62 $98.50 $100.85
What does one gal of water cost for the average residential customer?
Less than one
Penny!
What Can Buy You?
14
9,257 gallons
39 gallons
15 gallons
7 gallons
3 gallons
Requested Action
15
•Adopt the proposed CY2020 & CY2021
utilities rates.
The Following is the previous presentation –in
case we need to refer to one of the slides
during the question period
16
Public Hearing for
CY2020 & 2021 Utilities Rates
Vicki Quiram, Utilities Director
Ligeia Heagy, Utilities Department
September 17, 2019
Requested Action
•Set the date for a public hearing on the
proposed CY2020 & CY2021 utilities rates.
18
California Proposition 218
•Overview –Majority Protest Public Hearing
•Schedule
–Sep. 17, 2019: Set the majority-protest public hearing date for Nov. 19, 2019
–Oct. 1, 2019: Mailed the Notice of Hearing (minimum 45 days ahead of
public hearing)
–Nov. 19, 2019: Hold majority-protest public hearing, set rates
–Jan. 1, 2020: Implement new rates
•Protest process
19
Utilities Cost of Service Study
•Carollo Engineers, Inc.
•Objectives:
–Comply with Prop 218, state constitution, and
legal requirements
–Update data on current customer usage demands
–Ensure sufficient funding for operations
20
Utilities Cost of Service Study
•Process
–Revenue Requirement
–Functional Allocation
–Customer Class Allocation
–Rate Design
21
Customer Classes
Potable Water Wastewater
Single Family Single Family
Multi-family Multi-family
Non-Residential Commercial
Commercial Schools
Agriculture
Irrigation
Customer Classes - Examples
22
Utilities Cost of Service Study
23
Results
•Rebalances rates to account for shifting demand between classes
•Potable rate structure revision to mirror usage patterns
-Proposed Tier 3 deletion for multi-family residential (<5%)
•Reserve Policy for each utility: target of 40% of operating budget
Potable Water Revenue
24
•Revenue increase of 1% for CY2020, and 2% for CY2021
•Increase primarily driven by:
–Demand pattern shifts between customer classes
–SDCWA and MWD increases –cost of water
–SDCWA capital improvement program
SDCWA Demand Forecast
25
Historical & Forecasted Water Sales
700
600
_, 500 a: u..
~ 400 ~
"O ~ 300 V, ::,
0 = I-200
100
0
Revenue Impact:
• In 2008 $1 /AF= $620,000
• In 2015, $1 /AF= $500,000
• In 2019, $1/AF=$395,000
56% increase ($1.56/AF) to generate
2008 levels ($620,000)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Fiscal Year
• Forecasted Deliveries
4
SDCWA Cost Breakdown
26
Recommended CY 2020 Cost of Water Breakdown
$1,800
$1,600
$1,400
$1,200
LL. $1,000 :::: = $800
$600
$400
$200
$-
■ Transportation *
■ Supply Reliability*
Storage•
■ Customer Service •
■ Melded M&I Treatment Rate
■ Melded M&I Supply Rate
Untreated Water Cost
Approved
CY 2019
$120.00
$80.00
$171.00
$61.00
$276.00
$909.00
$1,341.00
$1,617.00
Preliminary St. %L'. CY 2020
$132.00 $12.00 10.0%
$104.00 $24.00 30.0%
$181.00 $10.00 5.8%
$64.00 $3.00 4.9%
$280.00 $4.00 1.4%
$925.00 $16.00 1.8%
$1,406.00 $65.00 4.8%
$1,686.00 $69.00 4.3%
10
Potable Water –where does the money go?
27
Other Financing Uses
4%
Personnel
7%
M & 0 & Capital Outlay
12%
FY 2020 Expenses
Depreciation
7%
MWD/CWA Fixed charges
11%
Water Purcha,
44%
• Water Purchases • MWD/CWA Fixed charges • M & 0 & Capital Outlay • Personnel • Other Financing Uses • CIP • Depreciation
Potable Water –Rates
28
Potable Water -Single Family 5/8ths Meter -Delivery Charge History
$30.00
$24.72 $24.72 $25.02 $25.52
$25.00 $24.11
$21.08 $22.19
$20.07
ov $20.00 ~
n;! ..c u ~ $15.00
,v
.::!
di
o $10.00
$5.00
$0.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
2019 Water Rate Comparison –Single Family Residential
29
Regional Monthly SFR Water Bill
$140
$120
$100
iii $80 r: r· .. .. ,1""1 r , ..
> :c .... $60 c:: 0 ~
$40 I
$20 ' $-.. . . . . ... . . . . . . . .. .. . . .. . .. .. . •
• .. .. • -Fixed Charge
-Commodity Charge
- -Regional Average
Recycled Water Revenue and Rates
30
Good news!
•No revenue increase recommended
•No rate increases proposed
Recycled Water –where does the money go?
31
FY 2020 Expenses
• Water Purchases • M & 0 & Capital Outlay • Personnel • Debt Service • Encina Services • CIP • Depreciation
Recycled Water –Rate History and Value
32
$6.00
$5.00
41 $4.00 ... ro ci:
u ·;:
; S3.00
E ::,
g $2.00
$1.00
$-
Volumetric Charge -Recycled Water Rate vs. Potable Irrigation Rate
$4.15 $4.22
$3.85 si.so ......... . .......... S3.53
$3.27
2011 2012 2013 2014
Recycled Water Rate -Potable Irrigation Rate
$4.44
2015
$4.67
2016
Calendar Year
$5.03
2017
S5.16
······ .....
$3.79
2018
S5.16 ··········· ················
$5.31 ....... ?.?·41
·········
$3.79 $3.79 $3.79
2019 2020 2021
......... Linear (Recycled Water Rate) ......... Linear (Potable Irrigation Rate)
Wastewater Revenue
33
•Revenue increase of 3% for CY2020, and 3% for CY2021
•Increased costs associated with Encina Wastewater Authority
–CalPers pension obligation -100% pay-off over 3 years ($4.1M)
–Capital Improvement Program ($95M –over the next 10 yrs)
•Inflation (chemicals and energy)
•Wastewater CIP (asset management plan & SCADA)
Wastewater –where does the money go?
34
M & 0 & Capital Outlay
19%
• M & O & Capital outlay • Personnel • Other Financing Uses • Encona Ser111ces • Encina CIP • CIP Depreciation
Wastewater –Historical Rates
35
Wastewater -Single Family Fixed Monthly Charge
$30.00 $29.52
$29.00 $28.66
Q.J $27.81 $27.81 $27.81 $27.81 ~ $28.00
.c u
2--$27.00 .c -$26.03 C
~ $26.00 $25.52
-c:,
-~ $25.00
I.I..
$24.00
$23.00
2014 2015 2016 2017 2018 2019 2020 2021
Calendar Year
Wastewater - Breweries
36
Breweries FY 2020 FY 2021
B1 – Brewery without a restaurant
and hauls waste for outside treatment $2.80 $2.88
B2 – Brewery without a restaurant
that does not haul waste for outside
treatment
$9.07 $9.34
B3 – Brewery with a restaurant and
hauls waste for outside treatment $7.87 $8.10
B4 – Brewery with a restaurant that
does not haul waste for outside
treatment
$11.26 $11.60
PROPOSED
2019 Wastewater Rate Comparison –Single Family Residential
37
$160
$140
$120
$100
$80
$60
$4o I s211s~
$20
$-
Regional Monthly SFR Wastewater Bill
.~111 11 1111
-Commodity Charge
Example of Monthly Bill Changes
38
Current Bill Proposed Bill
(Jan. 1, 2020)
Proposed Bill
(Jan. 1, 2021)
Potable Water1a $68.81 $70.55 $72.42
Wastewater1b $27.81 $28.66 $29.52
Total SF Residential $96.62 $99.21 $101.94
Requested Action
39
•Approve the proposed CY2020 & CY2021
utilities rates.