HomeMy WebLinkAbout; ; 2021 Potable and Recycled Water Rate Study; 2021-10-01Carlsbad Municipal Water District
Water Cost-of-Service Study
2021 POTABLE AND RECYCLED
WATER RATESTUDY
FINAL | October 2021
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Contents
Section 1 – Introduction 1
1.1 Study Purpose 1
1.2 Overview of the Rate Setting Process 1
1.2.1 Revenue Requirement Analysis 2
1.2.2 Water Demand Analysis 2
1.2.3 Cost-of-Service Analysis 2
1.2.4 Rate Design Analysis & Calculation 3
1.2.5 Rate Adoption 3
1.3 Project Objectives 3
1.3.1 Rate Study Best Practices and Legal Considerations 4
1.4 Current Rate Structure 4
1.5 Project Findings and Recommendations 4
Section 2 – Inputs and Assumptions 7
2.1 Forecast Assumptions 7
2.2 Potable and Recycled Water Customer Base 7
2.2.1 Water Demand Forecast 8
Section 3 – Revenue Requirement Analysis 9
3.1 Operating Revenues 10
3.2 Operating Expenses 11
3.3 Water Supply 12
3.4 Capital Improvement Plan Funding 13
3.5 Recommended Revenue Requirements 15
3.5.1 Cash Flow Sufficiency Test 15
3.5.2 Debt Coverage Test 18
Section 4 – Cost-of-Service Analysis 19
4.1 Legal and Policy Guidance 20
4.1.1 Legal Guidance 20
4.2 Industry Guidance 20
4.3 Functional Cost Allocation –Potable 21
4.3.1 Functional Cost Categories – Potable 21
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4.4 Rate Component Allocation – Potable 23
4.4.1 Rate Component Descriptions –Potable 23
4.5 Extra Capacity Allocation Factors –Potable 24
4.5.1 Max Day Demand –Potable 24
4.5.2 Max Hour Demand –Potable 25
4.6 Allocation of Revenue Requirements to Cost Components –Potable 26
4.7 Functional Allocation Results –Potable 32
4.7.1 Potable Water Functional Allocation Results 32
4.8 Customer Class Allocation 32
4.8.1 Potable Volumetric Cost Customer Class Allocation 33
4.8.2 Potable Fixed Cost Customer Class Allocation 36
4.8.3 Potable Water Customer Allocation Results 37
4.8.4 Functional Cost Allocation –Recycled 37
4.8.5 Rate Component Allocation –Recycled 38
4.8.6 Allocation of Revenue Requirements to Cost Components – Recycled 39
4.8.7 Functional Allocation Results – Recycled 43
Section 5 – Rate Design Analysis 44
5.1 Rate Structure Objectives and Goals 44
5.2 Potable Water Delivery Fees 44
5.3 Potable Water Usage Fees 47
5.3.1 Residential Rates 47
5.3.2 Commercial, Agricultural, and Irrigation Rate Design 51
5.4 Recycled Water Rates 51
5.4.1 Recycled Water Delivery Charges 51
5.4.2 Recycled Water Usage Rates 52
5.5 Proposed Potable Water Rates 52
5.6 Proposed Recycled Water Rates 53
5.7 Proposed Fire Service Rates 54
5.8 Regional Water Rate Comparison 55
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Appendices
AppendixA CUSTOMER AND DEMAND FORECASTS
AppendixB WATER SUPPLY PURCHASES AND COSTS
AppendixC CAPITAL IMPROVEMENT PLAN
AppendixD PROJECTED O&M COSTS
AppendixE REVENUE REQUIREMENT ANALYSIS
AppendixF POTABLE COST OF SERVICE ANALYSIS
AppendixG RECYCLED COST OF SERVICE ANALYSIS
AppendixH POTABLE WATER CUSTOMER ALLOCATION
AppendixI RATE DESIGN ANALYSIS
AppendixJ SUPPLY ALLOCATION
Tables
Table1 Proposed Water Usage Fees 5
Table2 Proposed Water Delivery Fees 6
Table3 Escalation Factors 7
Table4 Water System Customer Profile 8
Table5 Forecasted Water Demand by Customer Class (CCF)8
Table6 Current Rate Revenue ($ millions)10
Table7 Offsetting Revenues –Potable Water ($ millions)10
Table8 Offsetting Revenues –Recycled Water ($ millions)10
Table9 Expenditures –Potable Water ($ millions)11
Table 10 Expenditures –Recycled Water ($ millions)11
Table 11 Water Supply Purchases (AF, $ millions)12
Table 12 Capital Improvement Plan Expenditures –Potable Water ($ millions)13
Table 13 Capital Improvement Plan Expenditures – Recycled Water ($ millions)13
Table 14 Capital Improvement Plan Expenditures and Funding –
Potable Water ($ millions)14
Table 15 Capital Improvement Plan Expenditures and Funding –
Recycled Water ($ millions)15
Table 16 Cash Flow Sufficiency Test –Potable Water ($ millions)16
Table 17 Cash Flow Sufficiency Test –Recycled Water ($ millions)17
Table 18 Debt Service Coverage Test – Recycled Water ($ millions)18
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Table 19 Functionalized O&M Expenses –Potable ($ millions)22
Table20 Max Day Allocation 24
Table21 Max Hour Allocation 25
Table22 Extra Capacity Allocation 25
Table23 Functional Allocation Factors –Potable 28
Table24 Fixed Asset Allocation (Plant-in-Service) – Potable ($ millions)29
Table25 O&M Allocation to Rate Components – Potable ($ millions)30
Table26 Revenue Requirements Allocation to Rate Components –Potable ($ millions)31
Table27 Functional Allocation Results Summary –Potable Water ($ millions)32
Table28 Customer Class Service Units 33
Table29 Supply Allocation –Step 1 35
Table 30 Supply Allocation –Step 2 35
Table 31 Supply Allocation Summary 36
Table 32 Fixed Cost Customer Allocation Factors 36
Table 33 Potable Water Customer Allocation Summary, FYE 2022 ($ millions)37
Table 34 Functionalized O&M Expenses –Recycled ($ millions)38
Table 35 Functional Allocation Factors –Recycled 40
Table 36 Fixed Asset Allocation (Plant-in-Service) – Recycled ($ millions)40
Table 37 O&M Allocation to Rate Components –Recycled ($ millions)41
Table 38 Revenue Requirements Allocation to Rate Components –Recycled ($ millions)42
Table 39 Functional Allocation Results Summary –Recycled ($ millions)43
Table 40 Fixed Unit Costs –Potable 45
Table 41 Proposed Monthly Water Delivery Fees –Potable 45
Table 42 Proposed Fixed Unit Costs –Fire 46
Table 43 Proposed Monthly Water Delivery Fees –Fire 46
Table 44 Proposed Single-Family Residential Tier Allotments 47
Table 45 Single-Family Rate Design –Base, Max Day, Max Hour 48
Table 46 Single-Family Rate Design –Supply Costs 48
Table 47 Single-Family Rate Design Summary, FYE 2022 48
Table 48 Proposed Multi-Family Residential Tier Allotments 49
Table 49 Multi-Family Rate Design –Base, Max Day, Max Hour 49
Table 50 Multi-Family Rate Design –Supply Costs 50
Table 51 Multi-Family Rate Design Summary, FYE 2022 50
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Table 52 Commercial, Agricultural, and Irrigation Rate Design Summary, FYE 2022 51
Table 53 Fixed Unit Costs –Recycled 51
Table 54 Proposed Monthly Water Delivery Fees –Recycled 51
Table 55 Recycled Water Usage Rate Design Summary, FYE 2022 52
Table 56 Proposed Potable Water Delivery Fees 52
Table 57 Proposed Potable Water Usage Fees 53
Table 58 Proposed Recycled Water Delivery Fees 53
Table 59 Proposed Recycled Water Usage Fees 54
Table 60 Proposed Fire Service Delivery Fees 54
Figures
Figure 1 Conceptual Overview of the Rate-Setting Process 2
Figure 2 Cost-of-Service Analysis Steps 19
Figure 3 Single Family Monthly Demands for Supply Allocation 34
Figure 4 Regional Monthly Single-Family Water Bill Comparison – Average Customer 55
Figure 5 Regional Monthly Single-Family Water Bill Comparison – High Use Customer 56
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Abbreviations
ADD Average Day Demand
AF Acre Feet
AWWA American Water Works Association
Carollo Carollo Engineers, Inc.
ccf Hundred cubic feet
CIP Capital Improvement Plan
CMWD or District Carlsbad Municipal Water District
Desal Carlsbad Desalination Plant
DSCR Debt Service Coverage Ratio
DU Dwelling Unit
FYE Fiscal year ending
LWD Leucadia Wastewater District
M1 Manual Principles of Water Rates, Fees, and Charges: Manual of Water Supply
Practices M1
MDD Maximum Day Demand
MEU Meter Equivalent Unit
MFR Multi-Family Residential
MGD million gallons per day
MHD Max Hour Demand
MWD Metropolitan Water District of Southern California
O&M Operations and maintenance
PERS Public Employees' Retirement System
SCADA Supervisory Control And Data Acquisition
SDCWA San Diego County Water Authority
SFR Single-Family Residential
Study Cost-of-Service Study
UAL Unfunded Accrued Liability
UMAPC Uniform Member Agency Purchase Contract
VWD Vallecitos Water District
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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) 2022, the District is projected to deliver approximately 13,000 acre-feet (AF) of potable water
and 4,300 AF of recycled water to customers. The District currently purchases its potable water supplies
from the San Diego County Water Authority (SDCWA) and in 2016 the CMWD Board entered into a purchase
agreement with SDCWA for 2,500 acre-feet per year ofdesalinated water as local supply. Desalinated water
supplies are produced at the Carlsbad Desalination Plant (Desal). 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, Fiscal Year Ending (FYE)2022 through FYE 2026. Although this Study
presents a five-year rate projection, the District is adopting rates for the next two or three yearsat this time.
Carollo’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, and so that the rates paid by customers accurately reflect
the costs of the services that they receive. 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, do not exceed the reasonable andproportional cost of
providing the service. The District’s last rate study was completed by Carollo in 2019 and provided rates for
FYE 2020 through FYE 2021.
The District also has obligations to safeguard and preserve the State’s limited water resources. Article X (2)
of the State Constitution establishes the 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-servicerate 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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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 M1 (M1 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.
1.2.2 Water Demand Analysis
Forecasting water sales and purchases is a
critical component in the rate setting
process. As part of the 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.
1.2.3 Cost-of-Service Analysis
After determining the revenue requirement, this step outlinesthe cost to deliver each unit of water and to
serve each customer. This process takes each item in the water system’s budget and allocates the each
item’s cost 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 the District and the unique and
varied benefits delivered to each customer.
Revenue Requirement AnalysisCompares 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 AnalysisForecasts water sales based on historical billings, modifications to the rate structure, and any regulatory restrictions.
Cost-of-Service AnalysisIdentifies 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 & CalculationConsiders both the level and structure of the rate design to collect the distributed revenue requirements from each class of service.
Rate AdoptionThe Study presents the basis for the rates proposed to be adopted in
compliance with Proposition 218.
Figure 1 Conceptual Overview of the Rate-Setting Process
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1.2.4 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 supply, infrastructure, operating, and maintenance 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.
1.2.5 Rate Adoption
To comply with the requirements of Proposition 218, the results of the Study are documented in this Report
to support the District’spublic 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 sufficient detail to fully support and document the rate setting process.
In order to adjust rates, the District must provide 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 following 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 of the
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 be recovered in the 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 Feeis a fixed monthly charge. It is assessed based on meter size. It is intended to capture
the costs associated with providing customer service for each account, as well as a portion of the costs of
providing and maintaining 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 AWWA 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 byeach 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 analysis projections, the District 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 District’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. The City has historically set rates on a calendar year basis and will continue to do so
through the study period. Tables and figures throughout the report are show results in fiscal years to match
the District’s accounting practices.
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The key findings and recommendations are as follows:
Proposed Potable Water Rate RevenueIncreases.Annual user rate revenue increases of 2.0 percent
for FYE 2022 through FYE 2026 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 FYE 2022 based on the updated cost-of-service allocations followed by an across-the-board
increase in FYE 2023 and beyond. The first increase based on this study will be delayed by two
months and implemented on March 1, 2022. Subsequent increases will be implemented on January
1 of each year.
Recycled Water Rate Revenue Increases.Annual user rate revenue increases of 4.0 percent for
FYE 2022 through FYE 2026 will be required to fund recycled water activities. The proposed user
rates largely retain the District’s current rate structure and will include a cost-of-service adjustment
in FYE 2022 based on the updated cost-of-service allocations followed by an across-the-board
increase in FYE 2023 and beyond.
Minimum Operating Reserve.It is recommended that the District continues to complete financial
planning based on the current operating reserve practicethat sets a minimum operating reserve of
40 percent of annual operating expenses. In the future, the District could consider this practice to
increase the minimum reserve target with Council approval or implementing a best practice target
above the 40percent minimum for financial planning.
Table 1 and Table2 outline the current and proposed water usage and water delivery fees.
Table 1 Proposed Water Usage Fees
Customer Class
Current Rates Proposed Rates
Tier Usage
Limit Rate Tier Usage
Limit FYE 2022 FYE 2023
Potable Water Usage Fees 2.0%
w/ COS(1)2.0%(2)
Single Family
Residential
1 10 $4.13 1 10 $3.84 $3.92
2 18 $4.51 2 18 $4.77 $4.87
3 > 18 ccf $7.18 3 > 18 ccf $7.39 $7.54
Multi-Family Residential
per dwelling unit (DU) basis
1 5 $3.95 1 5 $3.79 $3.87
2 >5 ccf $5.04 2 >5 ccf $5.89 $6.01
Commercial N/A All ccf $4.36 N/A All ccf $4.34 $4.43
Agricultural N/A All ccf $4.71 N/A All ccf $4.70 $4.80
Irrigation N/A All ccf $5.41 N/A All ccf $5.47 $5.58
Recycled Water Usage Fees
4.0%
w/ COS(1)4.0%(2)
Recycled N/A All ccf $3.79 N/A All ccf $3.94 $4.09
Notes:
(1)Proposed rates for FYE 2022 include a cost-of-serviceadjustment and increases for specific rates vary from the 2.0-percent(potable) and
4.0-percent (recycled)overall rate revenue increases.
(2) Proposed rates for FYE 2023 and subsequent years are calculated by applying the proposed overall rate revenue increase to the FYE2022
rate proportionally.
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Table 2 Proposed Water Delivery Fees
Meter Size Current Rates Proposed Rates
FYE 2022 FYE 2023
Potable Monthly Charge 2.0% w/ COS
(1)2.0%(2)
5/8"$25.52 $27.81 $28.37
3/4"$34.44 $37.33 $38.08
1"$52.28 $56.37 $57.50
1.5"$96.88 $103.97 $106.05
2"$150.40 $161.09 $164.31
2 1/2"$212.84 $227.73 $232.29
3"$275.28 $294.37 $300.26
4"$453.68 $484.77 $494.46
6"$899.69 $960.76 $979.97
8"$1,434.89 $1,531.95 $1,562.59
10"$2,059.30 $2,198.33 $2,242.30
Recycled Monthly Charge 4.0% w/ COS
(1)4.0%(2)
5/8"$23.34 $23.45 $24.39
3/4"$32.22 $32.86 $34.18
1"$49.97 $51.69 $53.76
1.5"$94.35 $98.76 $102.71
2"$147.59 $155.23 $161.44
2 1/2"$209.77 $221.13 $229.97
3"$271.92 $287.02 $298.50
4"$449.35 $475.28 $494.30
6"$893.11 $945.95 $983.78
8"$1,425.61 $1,510.74 $1,571.17
10"$2,046.87 $2,169.67 $2,256.45
Fire Monthly Charge(3)2.0% w/ COS
(1)2.0%(2)
5/8"$7.93 $8.33 $8.50
3/4"$8.05 $8.45 $8.62
1"$8.30 $8.67 $8.85
1.5"$8.92 $9.24 $9.43
2"$9.66 $9.93 $10.12
2 1/2"$10.53 $10.72 $10.94
3"$11.40 $11.52 $11.75
4"$13.89 $13.79 $14.07
6"$20.10 $19.48 $19.87
8"$27.55 $26.30 $26.83
10"$36.25 $34.26 $34.95
12”$57.37 $53.60 $54.67
Notes:
(1)Proposed rates for FYE 2022 include a cost-of-serviceadjustment and increases for specific rates vary from the 2.0-percent (potable) and
4.0-percent (recycled)overall rate revenue increases.
(2) Proposed rates for FYE 2023 and subsequent years are calculated by applying the proposed overall rate revenue increase to the FYE2022
rate proportionally.
(3)Customers with private fire protection connections are charges a fixed monthly fee based on the size of their connection.
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Section 2 –Inputs and Assumptions
Financial, operational, and billing information provided by the District serves as the backbone of the revenue
requirement and cost-of-service analysis. The projections developed for this analysis are based on several
sources of information including the budgeted revenues and expenditures for FYE 2022, actual revenues and
expenditures from several prior fiscal years, outstanding debt obligations, water purchase records, and other
pertinent information. The analyses were completed by adding supplemental information and calculations
to the District’s existing financial models.
2.1 Forecast Assumptions
The escalation factors used in this analysis are based on a review of both long-term and recent cost
escalation factors from the Engineering News-Record Index, an industry benchmarking resource, and
informed by input from Carlsbad staff to reflect 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 Table3.
Table 3 Escalation Factors
Escalation Factor FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
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)13.2%13.2%13.2%13.2%13.2%
Labor – PERS (UAL)15.7% 16.5% 16.7% 17.0% 16.8%
Labor – Health Insurance 7.1%6.9%6.6%6.4%6.1%
Chemicals Inflation 5.0% 5.0% 5.0% 5.0% 5.0%
Utilities Inflation 5.0%5.0%5.0%5.0%5.0%
Construction Inflation 3.5% 3.5% 3.5% 3.5% 3.5%
Property Tax Increase 3.1%3.7%2.9%3.0%3.2%
Depreciation Funding 1.2% 1.2% 1.2% 1.2% 1.2%
Interest Income 2.3%2.4%2.5%2.5%2.5%
Customer Growth 0.3%0.7%0.5% 0.5% 0.2%
2.2 Potable and Recycled Water Customer Base
Detailed customer billing records for January 2018 through March of 2021 were analyzed to develop
customer demand and account projections for the study. Cost of service allocations and rate design
allocations were performed using projected accounts and demands for FYE 2022. Table4 summarizes the
projected FYE 2022 number of accounts and demand by customer class, including thepercentage of the
totals.Currently, the District serves approximately 28,000 potable water accounts and 920 recycled water
accounts. Water demands for FYE 2022 are expected at 5.89 million hundred cubic feet (ccfs)of potable
water and 1.85 million ccfs of recycled water demands.
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Table 4 Water System Customer Profile
Customer Class Number of
Accounts
Account
Percentage of
Total
FYE 2022
Demand (ccf)
Demand
Percentage of
Total
Single Family Residential 24,179 83.6%3,226,108 41.7%
Multi-Family Residential 1,241 4.3%734,848 9.5%
Commercial 1,736 6.0%1,185,208 15.3%
Agricultural 16 0.1% 74,408 1.0%
Irrigation 813 2.8%669,145 8.6%
Subtotal: Potable Water 27,984 5,889,716
Recycled Water 922 3.2%1,853,214 23.9%
Total Water Service Customers 28,906 100.0% 7,742,930 100.0%
Private Fire Protection Connections 1,116
Line or column totals may not tie due to rounding.
2.2.1 Water Demand Forecast
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. Changes in demands for
existing customers are not expected and thus the forecasted water demand was calculated using the
customer growth escalation factor presented in Table3. Table5 shows the projected water demands by
customer class for FYE 2022 through FYE 2026. Detailed projections of customer accounts and demands are
included for reference in Appendix A.
Table 5 Forecasted Water Demand by Customer Class (CCF)
Customer Class FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Potable Water Demands
Single Family Residential 3,226,108 3,257,927 3,267,993 3,293,597 3,311,634
Multi-Family Residential 734,848 742,095 744,388 750,220 754,329
Commercial 1,185,208 1,187,929 1,191,572 1,192,417 1,195,049
Agricultural 74,408 75,142 75,374 75,965 76,381
Irrigation 669,145 675,745 677,833 683,143 686,885
Total Potable Water Demands 5,889,716 5,938,839 5,957,160 5,995,343 6,024,278
Recycled Water Demands 1,853,214 1,871,492 1,877,274 1,891,982 1,902,344
Total All Customers 7,742,930 7,810,330 7,834,434 7,887,325 7,926,622
Line or column totals may not tie due to rounding.
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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, and other requirements 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 2022budget 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’scost drivers, three tests are
utilized to define the annual revenues necessary.
1.The cash flow sufficiency test 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 debt service coverage test. Utility bond or loan issuances regularly include a
stipulation that the agency maintain sufficient cash flows to cover the planned debt service, plus an
additionalpercentof that debt service, typically between 25 and 40percent.Debt coverage is often
presented as a ratio, for example a 25 percent coverage target is shown as 1.25x.
3.The third test is the reserve sufficiency test which determines whether projected cash balances are
sufficient to guard the utility in the event of unforeseen costs or revenue shortfalls. As an essential
service provider, the District needs to maintain resources to continue water service in the event of
natural disasters or other emergencies. Reserves provide a source of funds for immediate repairs or
other needs so that disruptions to service can be minimized or avoided.
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3.1 Operating Revenues
Operating revenues were projected for the next five years by applying the escalation factors outlined in
Table3 to the District’s FYE 2022budgeted revenues. Table6 shows the District’sprojected potable and
recycled water rate revenues for FYE 2022through FYE 2026, before applying any proposed rate increases.
Increases in commodityand delivery charge revenues are projected based on customer growth.Recycled
water revenues escalate in the same manner.
Table 6 Current Rate Revenue ($ millions)
Revenue Item FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Potable Water
Commodity Charges $26.6 $26.8 $26.9 $27.1 $27.1
Delivery Charges $12.3 $12.3 $12.4 $12.5 $12.5
Total Potable Water $38.9 $39.1 $39.3 $39.5 $39.6
Recycled Water
Commodity Charges $6.3 $6.3 $6.4 $6.4 $6.4
Delivery Charges $1.2 $1.2 $1.2 $1.2 $1.2
Total Recycled Water $7.5 $7.6 $7.6 $7.6 $7.6
Line or column totals may not tie due to rounding.
In addition to above rate revenues, the District also receives other offsetting revenues. Table 7summarizes
the projected offsetting revenues for the potable water funds, andTable8 summarizes the projected
offsetting revenues for the recycled water funds.
Table 7 Offsetting Revenues – Potable Water ($ millions)
Revenue Item FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Non-Rate Charges for Services $0.32 $0.33 $0.34 $0.35 $0.36
Tax Revenues $3.68 $3.82 $3.93 $4.04 $4.17
Intergovernmental $0.01 $0.01 $0.01 $0.01 $0.01
Fines & Forfeitures $0.10 $0.11 $0.11 $0.11 $0.12
Income from Prop & Investments $0.64 $0.65 $0.67 $0.69 $0.70
Interdepartmental $0.05 $0.05 $0.05 $0.05 $0.05
Other Revenues $0.09 $0.09 $0.09 $0.09 $0.09
Total Offsetting Revenues $4.88 $5.05 $5.19 $5.34 $5.51
Line or column totals may not tie due to rounding.
Table 8 Offsetting Revenues –Recycled Water ($ millions)
Revenue Item FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Other Charges for Services $0.001 $0.001 $0.001 $0.001 $0.002
Fines & Forfeitures $0.004 $0.004 $0.004 $0.005 $0.005
Income from Prop & Investments ($0.023)$0.000 $0.000 $0.000 $0.000
Interdepartmental $0.020 $0.021 $0.021 $0.022 $0.022
Total Offsetting Revenues $0.002 $0.026 $0.027 $0.028 $0.028
Line or column totals may not tie due to rounding.
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3.2 Operating Expenses
Most operating expenses were projected for the next five years by applying the escalation factors outlined in
Table3 to the District’s FYE 2022budgeted expenditures. Costs for water purchases from outside agencies
were calculated based on projected water demands and wholesale rates.Table 9 and Table 10 illustrate
operating expenditures over the five-yearprojection period for potable and recycledwater, respectively.
Potable operating expenses are projected to increase approximately $4.1 million by FYE 2026. The increases
are largely due to the rise in 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 $1.0 million over the projection period.Detailed projections of O&M costs are
included for reference in AppendixD.
Table 9 Expenditures – Potable Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Personnel $4.18 $4.84 $5.04 $5.26 $5.48
Maintenance & Equipment $4.38 $4.40 $4.50 $4.60 $4.71
Water Purchases (SDCWA and Desal)$31.36 $33.01 $34.42 $35.99 $37.61
Replacement Funding $4.50 $4.55 $4.61 $4.66 $4.71
Transfer to Capital Fund $4.00 $0.00 $0.00 $0.00 $0.00
Total Operating Expenditures $48.41 $46.80 $48.57 $50.52 $52.51
Line or column totals may not tie due to rounding.
Table 10 Expenditures – Recycled Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Personnel $1.84 $2.14 $2.23 $2.33 $2.42
Maintenance & Equipment $3.10 $3.11 $3.20 $3.29 $3.39
Water Purchases (Vallecitos)$2.27 $2.34 $2.41 $2.48 $2.55
Debt Service $1.88 $2.90 $2.90 $2.90 $2.25
Rate-Funded Capital $2.59 $0.00 $0.00 $0.00 $0.00
Replacement Funding $1.40 $1.42 $1.43 $1.45 $1.47
Total Operating Expenditures $13.07 $11.90 $12.17 $12.45 $12.08
Line or column totals may not tie due to rounding.
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3.3 Water Supply
The District obtains its potable 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.
Desalinated water deliveries began in 2016 per the Uniform Member Agency Purchase Contract (UMAPC).
The District is required to purchase a minimum 2,500 acre-feet of desalinated water per year, and purchases
are expected to remain at that level through FYE 2026.
The District produces recycled water at the Carlsbad Water Recycling Facility (CWRF)and purchases
recycled water from Vallecitos Water District (VWD). Recycled water purchased from Vallecitos is
strategically used in portions of the CMWD service area closest to interagency interties. Purchases from
VWD are projected to stay at the current level of 2,386 acre-feet per year through FYE 2026.
Table 11 presents a summary of the District’s forecasted potable and recycled water purchases in FYE 2022
through FYE 2026. Detailed projections of water purchases and costs are included for reference in
Appendix B.
Table 11 Water Supply Purchases (AF, $ millions)
Source of Supply FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Potable Water
Potable Water Demands 13,521 13,634 13,676 13,763 13,830
Unaccounted for Water (system loss)1,156 1,165 1,169 1,176 1,182
Total Potable Water to Purchase 14,677 14,799 14,845 14,940 15,012
SDCWA
Water Purchases (AF)12,177 12,299 12,345 12,440 12,512
Fixed Charges $6.7 $6.9 $7.1 $7.3 $7.6
Variable Charges $17.5 $18.8 $19.8 $21.0 $22.2
Total SDCWA Purchase Costs $24.3 $25.7 $27.0 $28.4 $29.8
Desalination
Water Purchases (AF)2,500 2,500 2,500 2,500 2,500
Fixed Charges $4.5 $4.6 $4.7 $4.8 $4.9
Variable Charges $2.0 $2.0 $2.1 $2.1 $2.2
Other Charges $0.7 $0.7 $0.7 $0.7 $0.7
Total DESAL Purchase Costs $7.1 $7.3 $7.4 $7.6 $7.8
Recycled Water
Recycled Water Demands 4,254 4,296 4,310 4,343 4,367
Unaccounted for Water 213 215 215 217 218
Total Recycled Water to Purchase 4,467 4,511 4,525 4,561 4,586
Water from CWRF 2,081 2,125 2,139 2,174 2,199
VWD Water Purchases (AF)2,386 2,386 2,386 2,386 2,386
VWD Charges $2.3 $2.3 $2.4 $2.5 $2.6
Total Recycled Purchase Costs $2.3 $2.3 $2.4 $2.5 $2.6
Line or column totals may not tie due to rounding.
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3.4 Capital Improvement Plan Funding
The District finalized a master plan for the potable and recycled water systems in 2019 as well as an asset
management plan and a SCADA master plan. Based on the results of those studies, the District plans to
increase capital investment over the coming years to repair and replace critical infrastructure and maintain
water system reliability.
Prior to the completion of the plans,the District’s CIP spending had been limited. However, the District
continued to set aside funds for capital projects throughout that time in anticipation of increased
investments.This prudent financial planning,which led to the reserve balance the District has accumulated,
will allow for capital improvements to be completed for the potable water system while minimizing rate
impacts.
Table 12 and Table 13 summarize the projected capital improvement plan (CIP) expenditures for the potable
and recycled water systems.Over the study period, potable system improvements will total $93.2 million
and recycled water improvements will total $12.5 million, both in FYE 2022 dollars. The capital funding
projections account for cost inflation by applying a 3.5-percent annual escalation factor to the planned CIP
costs. A detailed summary showing the District’s projects can be found in Appendix C.
Table 12 Capital Improvement Plan Expenditures – Potable Water ($ millions)
CIP FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Connection Fee Fund Projects $3.5 $4.3 $0.0 $8.2 $0.0
Replacement Fund Projects $22.7 $12.1 $21.9 $13.2 $7.2
Total Potable Water Projects $26.2 $16.5 $21.9 $21.5 $7.2
Total Escalated Cost $26.2 $17.0 $23.5 $23.8 $8.2
Line or column totals may not tie due to rounding.
Table 13 Capital Improvement Plan Expenditures – Recycled Water ($ millions)
CIP FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Connection Fee Fund Projects $3.3 $0.0 $0.0 $0.0 $0.0
Replacement Fee Fund Projects $5.3 $0.6 $1.2 $1.2 $0.9
Total Recycled Water Projects $8.6 $0.6 $1.2 $1.2 $0.9
Total Escalated Cost $8.6 $0.6 $1.3 $1.4 $1.0
Line or column totals may not tie due to rounding.
The District’s potable and recycled CIP expenses and funding is shown in Table 14 and Table 15. The
transfers and replacement funding line item represents the transfer of operating revenues to the capital
reserve for depreciation funding as well as any planned 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.
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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 will 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 plans
to update their connection fees in a future study within the next twelve months.
The District continually seeks sources of outside funding from grants and low interest loans to offset the rate
impacts of capital funding. For FYE 2022, the District has secured $0.8 million in federal grants for the D-4
Tank projectto improve the recycled water distribution and storage system. The District also expects
approximately $16.9 million in State Revolving Fund (SRF) loan disbursements. The disbursements include
$14.2 million for previously completed Phase 3 Recycled Water projects that were initially funded with cash
or reserves. The remaining $2.7 million of expected disbursements is for the costs of the D-4 tank.For
projection purposes, annual debt service associated with the SRF loan was estimated assuming a 2 percent
interest rate and a 30-year term, resulting in an annual payment of $203,000. The District’s recent
correspondence with the State indicated that the rate will be lower, at 1 percent. This change will lead to a
modest levelof cost savings which may offset a portion of recycled water rate increases in future years. The
projected debt service is included in the “Debt Service” line of Table 10.
Table 14 Capital Improvement Plan Expenditures and Funding – Potable Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Total Recycled Water Projects (Escalated)$26.2 $17.0 $23.5 $23.8 $8.2
Amount to be Rate Funded $0.0 $0.0 $0.0 $0.0 $0.0
Amount to be Funded with Reserves $26.2 $17.0 $23.5 $23.8 $8.2
Beginning Capital Funds Balance
(Connection Fee and Replacement)$94.3 $86.8 $77.2 $60.6 $43.6
Transfers and Replacement Funding $16.5 $4.6 $4.6 $4.7 $4.7
Interest $1.5 $1.4 $1.2 $1.0 $0.7
Connection Fees $0.7 $1.4 $1.0 $1.2 $0.3
Use of Funds for Projects ($26.2)($17.0)($23.5)($23.8)($8.2)
Year-End Balance $86.8 $77.2 $60.6 $43.6 $41.1
Change in Reserves ($7.5)($9.7)($16.6)($17.0)($2.4)
Line or column totals may not tie due to rounding.
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Table 15 Capital Improvement Plan Expenditures and Funding – Recycled Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Total Recycled Water Projects (Escalated)$8.6 $0.6 $1.3 $1.4 $1.0
Amount to be Rate Funded $2.6 $0.0 $0.0 $0.0 $0.0
Other Funding Required $6.0 $0.6 $1.3 $1.4 $1.0
Beginning Capital Funds Balance
(Connection Fee and Replacement)$3.1 $0.0 $8.4 $8.6 $8.8
Transfers and Replacement Funding $1.4 $1.4 $1.4 $1.4 $1.5
Grants $1.4 $0.0 $0.0 $0.0 $0.0
SRF Loan Disbursements(1)$0.0 $16.9 $0.0 $0.0 $0.0
Refund to Operating for Prior Cash Funding $0.0 ($9.4)$0.0 $0.0 $0.0
Interest $0.0 $0.0 $0.1 $0.1 $0.1
Use of Funds for Projects ($6.0)($0.6)($1.3)($1.4)($1.0)
Year-End Balance $0.0 $8.4 $8.6 $8.8 $9.4
Change in Reserves ($3.1)$8.4 $0.3 $0.2 $0.6
Line or column totals may not tie due to rounding.
3.5 Recommended Revenue Requirements
Rate revenue increases will be necessary in order to meet the District’s projected operating needs and to
continue to fund capital investments. 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
increases for recycled water are driven primarily by the need to fund capital improvements while
maintaining a positive reserve balance.
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.
3.5.1 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. Though the financial analysis included
projections for a five-year period, the District may adopt rate updates a period of up to five years.
3.5.1.1 POTABLE WATER
Based on the analysis, 2-percent rate revenue increases are needed in each year to adequately cover the
revenue requirements of the potable water system. The proposed potable water rate revenue increases for
FYE 2022will be implemented by a full cost-of-service adjustmenton March 1, 2021, and rate adjustments
will vary by customer class and rate component. For FYE 2023 and onward, the percentage rate revenue
increase is recommended to be applied to the FYE 2022 cost-of-service-based rateson January 1 of each
year.
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Total operating expenses included in the cash flow sufficiency test include depreciation. When sufficient
budget and fund balance are available, The District 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 District has been 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 spending down reserves
to fund capital projects overthe next five years.
Table 16 Cash Flow Sufficiency Test – Potable Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Pre-Rate Increase
Rate Revenues without Increases $38.9 $39.1 $39.3 $39.5 $39.6
Revenue from Previous Years’ Increases $2.0 $2.8 $3.7 $4.6 $5.4
Offsetting Revenues $4.9 $5.1 $5.2 $5.3 $5.5
Operating Revenues $45.7 $47.0 $48.2 $49.4 $50.5
Less Operating Expenditures ($48.4) ($46.8) ($48.6) ($50.5) ($52.5)
Cash Flow Surplus/(Deficit)($2.7)$0.2 ($0.4)($1.1)($2.0)
Rate Revenue Increase 2.0% 2.0% 2.0% 2.0% 2.0%
Post-Rate Increase
Revenue from Increase $0.8 $0.8 $0.9 $0.9 $0.9
(Less): Rate Increase Delay(1)($0.5)($0.4)($0.4)($0.4)($0.5)
Cash Flow Surplus/(Deficit)($2.4)$0.6 $0.0 ($0.7) ($1.5)
Operating Fund Reserve
Beginning Operating Fund Balance $26.4 $16.0 $16.6 $16.6 $15.9
Cash Flow ($2.4)$0.6 $0.0 ($0.7)($1.5)
Other Transfers ($8.0) $0.0 $0.0 $0.0 $0.0
Ending Operating Fund Balance $16.0 $16.6 $16.6 $15.9 $14.4
Ending Capital Funds Balance $86.8 $77.2 $60.6 $43.6 $41.1
Combined Ending Cash Balance $102.8 $93.7 $77.2 $59.5 $55.5
Days of O&M Costs 940 Days 810 Days 641 Days 474 Days 424 Days
Operating Fund Percent of Operations(2)40%39%38%35%30%
Notes:
(1) Adjustment to account for rate implementation in the middle of the fiscal year, March 1, 2022 and January 1of each subsequent year.
(2)The operating fund balance is drawn below the 40 percent target due to the planned replacement funding transfers to the capital
reserve. The District could reduce these transfers in future years to retain 40percent of operating costs in the operating fund which
would lead to a commensurate decrease in the capital fund balance.
Line or column totals may not tie due to rounding.
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3.5.1.2 RECYCLED WATER
Based on the analysis, 4-percent rate revenue increases are needed in each year to adequately cover the
revenue requirements of the recycled water system. The proposed recycled water rate revenue increases for
FYE 2022will be implemented by a full cost-of-service adjustment, and rate adjustments will vary by rate
component. For FYE 2023, thepercentage rate revenue increase is recommended to be applied to the
FYE 2022 cost-of-service-based rates.
Total operating expenses included in the cash flow sufficiency test include depreciation. The District
currently transfers an amount equal to annual depreciation as well as an additional capital funding transfer
from the operating reserves to the capital reserves each year. Over time, the District has been proactive in
annually contributing to the replacement of its system. Based on the current fund balances, the District can
mitigate the necessary rate adjustments by spending down reserves to fund capital projects over the next
five years.
Additional detail of the revenue requirement analysis is included for reference in Appendix E.
Table 17 Cash Flow Sufficiency Test –Recycled Water ($ millions)
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Pre-Rate Increase
Rate Revenues without Increases $7.5 $7.6 $7.6 $7.6 $7.6
Revenue from Previous Years’ Increases $0.7 $1.0 $1.4 $1.8 $2.1
Offsetting Revenues $0.0 $0.0 $0.0 $0.0 $0.0
Operating Revenues $8.2 $8.6 $9.0 $9.4 $9.8
Less Operating Expenditures ($13.1) ($11.9) ($12.2) ($12.4) ($12.1)
Cash Flow Surplus/(Deficit)($4.9)($3.3)($3.2)($3.0)($2.3)
Rate Revenue Increase 4.0% 4.0% 4.0% 4.0% 4.0%
Post-Rate Increase
Revenue from Increase $0.3 $0.3 $0.4 $0.4 $0.4
(Less): Rate Increase Delay(1)($0.2)($0.2)($0.2)($0.2)($0.2)
Cash Flow Surplus/(Deficit)($4.7)($3.1) ($3.0)($2.8) ($2.1)
Operating Fund Reserve
Beginning Operating Fund Balance $9.7 $5.0 $11.2 $8.2 $5.4
Cash Flow ($4.7)($3.1)($3.0)($2.8)($2.1)
Other Transfers $0.0 $9.4 $0.0 $0.0 $0.0
Ending Operating Fund Balance $5.0 $11.2 $8.2 $5.4 $3.3
Ending Capital Funds Balance $0.0 $8.4 $8.6 $8.8 $9.4
Combined Ending Cash Balance $5.0 $19.6 $16.9 $14.2 $12.7
Day of O&M Costs 252 Days 942 Days 785 Days 642 Days 556 Days
Operating Fund Percent of Operations 69%148%105%67%40%
Note:
(1)Adjustment to account for rate implementation in the middle of the fiscal year, March 1, 2022 and January 1of each subsequent year.
Line or column totals may not tie due to rounding.
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3.5.2 Debt Coverage Test
The District's current and projected debt obligations are State Revolving Fund loans which historically
required the agency’s annual operating revenues are sufficient to cover annual operating expenses plus
110 percentof the annual debt service payments. This is stated as a debt coverage ratio (DSCR) of 1.10x.
However, the District has a policy target of maintaining a bond coverage ratio of 125 percent of the annual
debt service obligation. The outstanding debt agreements allow both potable and recycled water revenues
to be used in the calculation of debt coverage. Based on the proposed rate revenue increases, the District
will meet its debt coverage obligation. Table 18 presents the calculation of the DSCR.
Table 18 Debt Service Coverage Test –Recycled Water ($ millions)
Budget Item FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Post Increase Revenues
Potable Water Operating Revenues $46.0 $47.4 $48.6 $49.9 $51.0
Recycled Water Operating Revenues $8.3 $8.6 $9.0 $9.4 $9.8
Total Revenues for Coverage $54.3 $56.0 $57.6 $59.3 $60.8
Potable Water Operating Expenses ($39.9)($42.2)($44.0)($45.9)($47.8)
Recycled Water Operating Expenses ($7.2) ($7.6) ($7.8) ($8.1) ($8.4)
Net Revenue Available for Debt Service $7.2 $6.2 $5.8 $5.3 $4.6
Recycled Water Debt Service $1.9 $2.9 $2.9 $2.9 $2.3
DSCR 3.83x 2.14x 2.00x 1.84x 2.06x
Line or column totals may not tie due to rounding.
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Section 4 –Cost-of-Service Analysis
The Cost-of-Service analysis follows a step-by-step approach to tying the District’s expenses to the rates
charged to customers. Those steps are outlined in the figure below.
Figure 2 Cost-of-Service Analysis Steps
Based on the revenue requirement analysis outlined in the preceding chapter, the functional allocation
designates each budget item to a functional category, which is then translated into a specific cost/rate
component. Those functional categories and their associated costs are allocated to the distinct customer
classes based on each class’s unique account, meter, and demand characteristics. A customer class consists
of users that commonly create or share responsibility for certain costs incurred by the utility, which is
determined by customer consumption data (including peak demand) in order to combine similar groups of
customers.
Cost Functionalization
The District's expenses are
allocated to functional
categories on a line-by-line
basis.
Rate Component Allocation
The functional categories are
allocated to cost components
based on engineering standards.
Customer Class and Tier
Allocation
The cost components are
reallocated to each class or tier
based on demand profiles.
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4.1 Legal and Policy Guidance
4.1.1 Legal Guidance
This Report should not be considered legal guidance and it does not offer any assurances of compliance with
any other state, federal, or other laws. However, it is guided by the best available legal guidance and strives
to match that guidance.
All water rates in California must meet the requirements outlined in the California State Constitution,
Article XIII D, Section 6. The rates recommended in this Report are developed based on the guidance from
the 2015 decision by the Court of Appeal in Capistrano Taxpayers Association v. City of San Juan Capistrano,
(2015) 235 Cal. App. 4th 1494 as well as other legal authority and provisions of the Constitution.
In San Juan Capistrano, the court stated that any rates, including tiered rates, must “correspond to the
actual cost of providing service at a given level of usage.”Id. at 1498. Furthermore, the court stated:
“And, we emphasize, there is nothing at all in [California Constitution Article XIII D, section 6,]
subdivision (b)(3) or elsewhere in Proposition 218 that prevents water agencies from passing on
the incrementally higher costs of expensive water to incrementally higher users. That would
seem like a good idea. But subdivision (b)(3) does require they figure out the true cost of water,
not simply draw lines based on water budgets...Our courts have made it clear they interpret
the Constitution to allow tiered pricing; but the voters have made it clear they want it done in a
particular way.” San Juan Capistrano at 1510-11.
This statement from the court outlines several fundamental principles for this rate analysis:
Rates must be based on the cost of providing water service.
Tiered pricing is an acceptable methodology under Proposition 218.
Increasing block rates that pass incrementally higher costs of expensive water onto incrementally
higher demand users is an acceptable methodology of proportionately allocating the costs of
service under Proposition 218.
4.2 Industry Guidance
While Proposition 218is the ultimate test for rates, industry guidance and commonly accepted rate-setting
practices can serve as a template for achieving cost-based rates. The AWAA M1 Manual outlines the two
most widely used methods for allocation of functionalized costs to cost components:
Base-Extra Capacity Method, where costs are allocated among: (1) a base category to provide
baseline water service or average day demand; (2) an extra capacity category to provide peak
demand service, often split into maximum day and maximum hour components; (3) a customer
category to provide services that do not vary with water usage, such as customer service and billing;
and (4) direct fire protection.
Commodity-Demand Method, where costs are allocated among: (1) a commodity category for
costs that are directly driven by demand; (2) a demand category for building and maintaining peak
system capacity; (3) a customer category to provide services that do not vary with water usage, such
as customer service and billing; and (4) direct fire protection.
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Both methodologies recognize that cost-of-service “depends not only on the total volume of water used, but
also on the rate of use, or peak demand requirements.”1 Costs incurred by the District are not incurred
uniformly, or simply based on the total quantity or volume of water used. The cost-of-service changes based
on both when, how, and how much water is used. Both methodologies account for this by including an extra
capacity or demand category, in recognition of costs associated with capacity that is not used consistently
which impacts operating costs and capital asset related costs to accommodate peak flows.
For this analysis, the Base-Extra Capacity methodology was selected. The following sections discuss how
costs are allocated to the system’s functions, cost components, and customer classes using this
methodology.
4.3 Functional Cost Allocation –Potable
4.3.1 Functional Cost Categories –Potable
The functional cost allocation assigns the revenue requirement for the test year by major function. The
Study developed a list of functions specific to the District’s water system. Each functional component is
allocated to specific cost components, which can then be assigned to rates. The functional components used
for the District are:
Customer Account Service:Costs for materials and outside services directly related to customer
communication such as outreach, printing, and postage.
Meters and Services:Costs associated with water meters and service connections.
Administration:Costs related to the overall management and oversight of the water system including legal
costs, permitting and regulatory fees, studies, and as well as other related items. This category also includes
the costs that the water utility pays to other City of Carlsbad departments for services that they provide such
as customer billing and information technology services.
Distribution:Costs associated with delivering water to customers including the operation and maintenance
of the water distribution system facilities.
Supply:The District’s internal costs associated with water purchased from SDCWA and desalinated water.
These costs include a portion of operations and maintenance staff costs, water sampling services, chemicals,
lab costs, and other related items.
SDCWA Variable:The variable portion of the costs that the District pays to SDCWA for treated water
supplies.
SDCWA Fixed: The fixed portion of the costs that the District pays to SDCWA for treated water supplies not
including the Infrastructure Access Charge (IAC).
SDCWA IAC: This category includes the costs of the SDCWA IAC, a fixed charge that SDCWA levies on the
District based on the District’s count of MEUs.
Desalination: The costs that the District pays to purchase desalinated water.
Conservation:Costs associated with conservation programs, such as rebates, and communications aimed at
increasing overall water supply and reliability through encouraging or mandating customers that use large
amounts of water to reduce water usage in order to increase water supply and reliability.
1 AWWA,M1 Manual, p. 61.
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Fire Protection: Costs that the District incurs specifically related to providing fire protection. The ability to
provide fire protection service is intrinsic to the water system based on typical water system planning and
engineering, those intrinsic characteristics are accounted for in costs allocated to the other categories, most
notably within the Meters and Services and Distribution categories.
Cross Connection Control:Costs related to the District’s cross-connection control program.
Engineering:Costs related to the District’s engineering activities.
General:Costs associated with other expenses that provide an overall benefit to the water system such as
staff costs for management personnel who oversee all aspects of the water operation. This category also
includes costs that do not fit any of the other categories such as asphalt repairs, landscaping services,
miscellaneous supplies, and other overhead expenses.
4.3.1.1 O&M EXPENSE FUNCTIONALIZATION – POTABLE
The District’s O&M expenses were functionalized into each of the above categories using the FYE 2022
budgeted operating expenses. Table 19 presents a summary of the O&M cost functionalization. A detailed
table of the functionalization is included in AppendixF.
Table 19 Functionalized O&M Expenses – Potable ($ millions)
Functional Component Personnel
Maintenance
& Equipment
Budget
Adjustments
Total
Allocated
Resulting
Allocation
Customer Account
Service $0.00 $0.04 ($0.00)$0.03 0.09%
Meters and Services $0.65 $1.05 ($0.07) $1.63 4.09%
Admin $0.30 $2.39 ($0.11)$2.58 6.46%
Distribution $1.45 $1.59 ($0.12) $2.91 7.29%
Supply $0.20 $0.39 ($0.02)$0.56 1.41%
SDCWA Variable $0.00 $17.52 ($0.72) $16.80 42.09%
SDCWA Fixed $0.00 $4.89 ($0.20)$4.69 11.75%
SDCWA IAC $0.00 $1.86 ($0.08) $1.78 4.46%
Desal $0.00 $7.09 ($0.29)$6.80 17.04%
Conservation $0.09 $0.03 ($0.00) $0.11 0.27%
Fire Protection $0.00 $0.07 ($0.00)$0.07 0.16%
Cross Connection Control $0.14 $0.03 ($0.01) $0.17 0.42%
Engineering $0.40 $0.07 ($0.02)$0.45 1.14%
General $0.95 $0.44 ($0.06) $1.33 3.33%
Total O&M Expenses $4.18 $37.44 ($1.71)$39.91 100.00%
Line or column totals may not tie due to rounding.
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4.4 Rate Component Allocation –Potable
After O&M costs are functionalized, they can be allocated to rate components along with capital costs and
other revenue requirement elements. These rate components are the foundation of the individual rates,
with each component corresponding to individual or multiple rate components.
The District’s rate components are used to allocate costs to the fixed monthly service charges and the
volumetric rates. The volumetric components include base, extra capacity (maximum day and maximum
hour), SDCWA, desalination, and conservation. The customer-related rate components (customer, service,
and private fire protection)are the basis of the fixed monthly service charges.
Fire protection costs are separated into private and public. While private fire protection costs are only
allocated to private fire customers through the private fire service charge, the public fire protection costs are
attributable to all othercustomer classes and recovered via the service component.
4.4.1 Rate Component Descriptions –Potable
The following describes each of the cost components for the District.
Volumetric Components
Base:This category includes a portion of operating and capital costs related to internal source of supply and
distribution costs, up to a level that meets the District’s baseline(average day) demands throughout the
year. Base also includes a portion of general and administrative costs associated with the operations and
management of those functions.
Extra Capacity –Max Day:This category includes a portion of O&M and capital costs for water distribution
related to meeting maximum day demands. Max dayalso includes a portion of general and administrative
costs associated with the operations and management of those functions. Lastly, the costs of the District
conservation activities are included in this category.
These costs are incremental to those required for Base service. For example, they include capital costs
related to oversizing the system to meet excess max day demand.
System peaking factors are used to determine the appropriate allocations to the Extra Capacity cost
components. For the purpose of this study, the maximum day peaking factor is 2.06 based on the District’s
water use records. This means that the maximum day demand is assumed to be 2.06 times the average day
demand, and the maximum hour demand is assumed to be three times the average day demand.
The calculation of the allocation basis from these peaking factors is detailed in the next section.
Extra Capacity –Max Hour:The Max Hour category is similar to the Max Day category but covers the
additional costs related to peak above Max Day. These costs are incremental to those required for Base and
Max Day service. The Max Hour peaking factor is 2.90 timesthe average hour demand. The Max Hour
peaking factor was developed in the District’s master plan.
SDCWA:This category includes the variable costs of purchasing treated water from SDCWA.
Desalination:This category includes the costs of purchasing desalinated water through the UMAPC.
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Fixed Components
Service:Costs associated with customer meters and service lines and the associated capacity. The fixed
costs charged to the District by SDCWA are also included in this component. These costs are included in the
fixed charge based on the meter’s hydraulic capacity.
Customer:Costs related to operational support activities including accounting,administration,billing, and
customer service. These expenditures are common to all customers and are reasonably uniform across the
different customer classes.
Private Fire Protection:Costs associated with providing private fire protection services via dedicated
connections. A portion of the distribution system and service costs are included as the system must have
sufficient hydraulic capacity to support the pressures and flow demands for fire protection service.
4.5 Extra Capacity Allocation Factors –Potable
For costs related to either Max Day or Max Hour, the peaking factors for each component need to be
normalized into a 100 percent scale to allow allocation of costs. The peaking factors are generated as a ratio
of the peak demand for a given time period (max month, max day, etc.) to the average demand for the same
time period.
For Base-Extra Capacity, this relies on Max Day Demand (MDD) and Max Hour Demand (MHD) flow criteria.
District staff provided average day demand (ADD) and MDD conditions for the past three fiscal years based
on SCADA monitoring data. The Max Hour Demand (MHD) peaking factor is based on the District’s 2019
Master Plan.
4.5.1 Max Day Demand –Potable
For MDD, the highest demand day is approximately 24.50 mgd based on the peak demand from FYE 2020
which occurred on August 23, 2019.Table20 outlines the calculation of the allocation basis from these
peaking factors. Base corresponds with ADD of 11.89 mgd, which is set at 100 percent. The incremental Max
Day capacity required above ADD to meet MDD is 12.61 mgd, or 106 percentof base.
The percentages associated with total MDD capacity need to be normalized into a 100 percentbasis. After
normalizing, 49 percent of capacity is associated with Base demand and 51 percent is associated with the
incremental capacity needed to meet MDD.
Table 20 Max Day Allocation
Peaking Factor MGD Percent of Base
Normalized
Allocation
Base (Average Day)11.89 100%48.5%
Incremental Max Day 12.61 106%51.5%
Total Max Day 24.50 206%100%
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4.5.2 Max Hour Demand –Potable
Table21outlines the calculation of the allocation basis from the MHD peaking factors. The District’s 2019
master plan determined a MHD peaking factor of 2.90. Applied to the ADD of 11.89 mgd, the 2.90 MHD
factor results in estimated max hour demands of 34.98 mgd. Base corresponds with ADDof 11.89 mgd,
which is set at 100 percent. The incremental Max Day capacity required above ADD to meet MDD is 12.61
mgd, or 106 percentof base. The incremental Max Hour capacity required above MHD is 9.98 mgd, or
84 percentof base.
The percentages associated with total MHD capacity need to be normalized into a 100percentbasis. After
normalizing, 34 percentof capacity is associated with Base demand, 37 percentis associated with the
incremental capacity needed to meet MDD, and 29percent is associated with the incremental capacity
needed to meet MHD.
Table 21 Max Hour Allocation
Peaking Factor MGD Percent of Base
Normalized
Allocation
Base (Average Day)11.89 100%34.5%
Incremental Max Day 12.61 106%36.6%
Incremental Max Hour 9.98 84%29.0%
Total 34.98 290%100%
Line or column totals may not tie due to rounding.
Certain costs related to distribution systemO&M or sizing are split between the extra capacity components,
max day and max hour. The allocation for those costs outlined in Table 22. The allocation is developed based
on the incremental max day and max hour demands’ proportional share of total extra capacity. With the
incremental max day demands of 12.61 mgd and incremental max hour demands of 9.98 mgd, the extra
capacity allocation is 56 percent to max day and 44percentto max hour.
Table 22 Extra Capacity Allocation
Peaking Factor MGD
Extra Capacity
MGD
Extra Capacity
Allocation
Base (Average Hour)11.89 n/a n/a
Incremental Max Day 12.61 12.61 55.8%
Incremental Max Hour 9.98 9.98 44.2%
Total 34.98 22.59 100%
Line or column totals may not tie due to rounding.
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4.6 Allocation of Revenue Requirements to Cost Components –Potable
The next step in the Cost-of-Service analysis is to allocate revenue requirements to each cost component
outlined in Section 4.4.1.Each functional category allocation from Section 4.3.1 is then reallocatedto a rate
component.
The percentages connecting each functional category with a rate component are outlined in Table23.
These percentages are then used to distribute the O&Mfunctional category totals from Table 19 into the
rate components, with results summarized in Table 25. Other revenue requirement elements including
capital costs, replacement funding, and offsetting revenues are also allocated rate components in this step.
Finally, revenue requirement elements allocated to each rate component are summed to determine the
total revenue requirements, by rate component, for the FYE 2022 test year.The resulting allocation is shown
in Table26.
Functionalized O&M expenses and the other revenue requirement elements are allocated to the rate
categories based on the how and why the costs are incurred, and the services provided to each rate payer by
those activities. The O&M expenses and other revenue requirement elements are allocated to rate
components as follows:
Customer and Administration:These costs are considered to be equal for all customers regardless of their
water demands or the size of their water meters. Thus, to account for each billed connection’s share of these
costs, they are allocated to the customer and private fire protection rate components.
Meters and Services:This category includes service costs that are common to all customers as well as costs
that vary based on the size of each connection. Meters and services costs are split between the customer,
service, and private fire components. Fiftypercent of costs are allocated between private fire and customer
proportional to the number of potable connections and fire protection connections. The remaining
fiftypercentof costs are allocated between the service and private fire protection proportional to the
number of potable MEUs and private fire protection MEUs.
Distribution:Distribution costs are split between the max day and max hour components. This allocation
accounts for the oversizing of the distribution system, including pipelines, pump stations, storage facilities
and other infrastructure to meet peak demands. This system oversizing drive increased operating and
capital costs which are in turn recovered from the extra capacity components.
Supply:These costs are common to all units of water sold and do not vary based on system peaking. They
are allocated to the base rate component.
SDCWA Fixed and SDCWA IAC:These costs are assessed to the District, by SDCWA, on a fixed basis tied to
a combination of rolling average water purchases, MEUs, and maximum capacity demands.Thus, they can
reasonably be recovered through the District’s fixed delivery charge. Therefore, these costs are allocated to
the service rate component to reflect the capacity needed to serve each customer.
SDCWA Variable:These costs are allocated to the SDCWA component which is later allocated to each
customer class based on their allocated share of SDCWA water purchases.
Desalination:These costs are allocated to the desalination component which is later allocated to each
customer class based on their allocated share of water purchases.
Conservation:These costs are allocated to the max dayrate component as the conservation program is
aimed at helping users reduce their incremental demands.
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Fire Protection:These costs are allocated to the service and the private fire rate components proportionally
based on the number of MEUs for normal service meters and private fire protection connections.
Cross Connection Control:These costs are fixed in nature and are allocated to the service rate component.
Engineering:The District’s engineeringefforts include planning and managingcapital projects as well as
supporting operations.These costs are allocated across the rate components based on the allocation of the
water system’s fixed assets.
General:These costs are for items andactivities that provide a general benefit to the water system. They
are therefore allocated to the rate components based on the weighted average of O&M expenses.
Capital Costs:Capital related revenue requirements including replacement funding and transfers to the
capital replacement reserveare allocated based on the water system’sfixed assets.This reflects that the
District, as well as most utilities, spend CIP typically in accordance with the current functionalization of the
system. For instance, if 25percent of the value of the system is related to storage tanks and reservoirs, as is
the case with the District, then it is reasonable to assign approximately 25percentof the CIP to storage
tanks and reservoirs because it is assumed the District will invest a proportional amount of maintenance,
repair, and replacement on storage.While some agencies rely on project specific capital allocations, that
process can lead to shifting and rate spiking as projects of different types are completed. Allocating capital
costs using the overall fixed asset replacement cost ties the long-term costs of capital investments to the
District’s physical system while avoiding rate spikes and shifting allocations. A summary of the allocation of
fixed assets in shown in Table24.
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Offsetting Revenues and Operating Cash Flows:Offsetting revenues and cash flows are allocated based
on theweighted average allocation of all other revenue requirements.
The allocation factors used in the potable water functional allocation are outlined in Table23.
Table 23 Functional Allocation Factors – Potable
Allocation Factor Customer Service Base Max
Day
Max
Hour
Private
Fire SDCWA Desal
Customer Only(1)96.2%3.8%
Service Only(2)98.5%1.5%
Service Only – No
Fire 100.0%
Customer and
Meter Service(3)48.1%49.3%2.7%
SDCWA Only 100.0%
Desal Only 100.0%
Base 100.0%
Max Day 100%
Max Day/Max
Hour(4)55.8%44.2%
Plant-In-Service(5)0.1% 51.2% 4.2%23.9%19.0%1.5%
Notes:
(1) Allocation proportional to the number of connections for retail potable customers and private fire protection connections.
(2)Allocation proportional to the number of MEUs for retail potable customers and private fire protection MEUs with private fire protection
component adjusted to reflect only the portion of the system related to providing system wide fire protection.
(3)Allocation split to customer and service components with 50percent to customer and 50percent to service, allocations adjusted to
account for customer and capacity related costs that are attributable to private fire protection.
(4)Allocation based on extra capacity demands as described in Table22.
(5)Allocation of fixed assets as shown in Table 24.
Line or column totals may not tie due to rounding
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Table 24 Fixed Asset Allocation (Plant-in-Service)– Potable ($ millions)
Asset Class
Replacement
Value Customer Service Base Max Day Max Hour
Systemwide
Fire Protection
Land $10.4 100%
Buildings $10.8 100%
Water Service & Meters $1.1 50%50%
Machinery & Equipment $0.2 100%
Fire Hydrants $0.0 100%
Reservoirs $96.7 34%17%18%14%16%
Pipes & Pumping $273.6 35%28%22%15%
Construction in Progress $0.0
Total Allocation $392.9 $0.6 $150.5 $16.7 $94.0 $74.5 $56.7
Percentage Allocation 0.1%38.3%4.2%23.9% 19.0%14.4%
Reallocation of Systemwide Fire Protection to Service and Private Fire Protection
Customer Service Base Max Day Max Hour
Private Fire
Protection
Fixed Asset Allocation for Cost-of-Service 0.1%51.2%4.2%23.9%19.0%1.5%
Line or column totals may not tie due to rounding.
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Table 25 O&M Allocation to Rate Components – Potable ($ millions)
Operating Expenditures Customer Service Base Max Day Max
Hour
Private
Fire SDCWA Desalination As All
Others Total
Customer Account Service $0.03 ----$0.00 ---$0.03
Meters and Services $0.78 $0.80 - - - $0.04 --- $1.63
Admin $2.48 ----$0.10 ---$2.58
Distribution - - - $1.62 $1.29 - --- $2.91
Supply --$0.56 ------$0.56
SDCWA Variable - - - - - - $16.80 -- $16.80
SDCWA Fixed -$4.69 -------$4.69
SDCWA IAC - $1.78 - - - - --- $1.78
Desal -------$6.80 -$6.80
Conservation - - - $0.11 - - --- $0.11
Fire Protection -$0.06 ---$0.00 ---$0.07
Cross Connection Control - $0.16 - - - $0.00 --- $0.17
Engineering $0.00 $0.23 $0.02 $0.11 $0.09 $0.01 ---$0.45
General - - - - - - -- $1.33 $1.33
Operating Expenditures Subtotal $3.30 $7.74 $0.58 $1.84 $1.37 $0.15 $16.80 $6.80 $1.33 $39.91
Reallocation of "As All Others" $0.11 $0.27 $0.02 $0.06 $0.05 $0.01 $0.58 $0.23 ($1.33) -
Total Allocation $3.41 $8.00 $0.60 $1.90 $1.42 $0.16 $17.38 $7.03 -$39.91
Line or column totals may not tie due to rounding.
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Table 26 Revenue Requirements Allocation to Rate Components – Potable ($ millions)
Rate Revenue Requirement Customer Service Base Max Day Max
Hour
Private
Fire SDCWA Desalina
tion
As All
Others Total
Operating Expenses $3.41 $8.00 $0.60 $1.90 $1.42 $0.16 $17.38 $7.03 -$39.91
Debt - - - - - - - - - -
Rate Funded Capital ----------
Replacement Funding
(Depreciation Funding)$0.01 $2.31 $0.19 $1.08 $0.85 $0.07 - - - $4.50
Transfer to Capital Fund $0.01 $2.05 $0.17 $0.96 $0.76 $0.06 ---$4.00
Cash Flows - - - - - - - -($2.42) ($2.42)
Adjustment for Mid-Year Increase --------$0.54 $0.54
Less Offsetting Revenues - - - - - - - - ($4.88) ($4.88)
Total Rate Revenues to be
Collected $3.42 $12.36 $0.96 $3.94 $3.03 $0.29 $17.38 $7.03 ($6.76)$41.65
Reallocation of "As All Others" ($0.48) ($1.73) ($0.13) ($0.55)($0.42) ($0.04)($2.43)($0.98) $6.76 -
Total Allocation $2.95 $10.63 $0.83 $3.39 $2.61 $0.25 $14.95 $6.05 -$41.65
Line or column totals may not tie due to rounding.
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4.7 Functional Allocation Results –Potable
Once each revenue requirement element is allocated, a combined allocation of the District’s expenses is
used as the basis for allocating rate revenue requirements to each functional category and subsequently to
each customer class. The functional allocation also defines the split between costs recovered through fixed
rate components and those recovered through variable rate components.
4.7.1 Potable Water Functional Allocation Results
The results of the potable water functional allocation analysis are shown in Table27.The largest single
component of the system's costs are related to variable supply costs for imported water from SDCWA.
Combined with Desalination costs, these source costs make up approximately 52percent of the District’s
potable rate revenue requirements.
The Service, Customer, and Fire cost components are collected through fixed rate components and total
approximately 33 percent of the District's potable costs. These costs are recovered through Carlsbad’s
monthly delivery fee. The District’s water usage fees recover the remaining 67 percent of costs, which are
allocated to the Base, Max Day, Max Hour, SDCWA, and Desalination components.
Table 27 Functional Allocation Results Summary – Potable Water ($ millions)
Allocation Basis Revenue Requirement
($ millions)
Percent of Total Functional
Allocation
Customer $2.95 7.1%
Service $10.63 25.5%
Base $0.83 2.0%
Max Day $3.39 8.1%
Max Hour $2.61 6.3%
Fire $.25 0.6%
SDCWA $14.95 35.9%
Desalination $6.05 14.5%
Total $41.65 100.0%
Line or column totals may not tie due to rounding.
4.8 Customer Class Allocation
The final step in the cost-of-serviceanalysis 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.
Table28presentsthe 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 Table28 are the projected values for FYE 2022.
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Table 28 Customer Class Service Units
Service Unit Single
Family
Multi-
Family Commercial Agricultural Irrigation Fire Total
Number of Accounts
(Customer)24,179 1,241 1,736 16 813 1,116 29,100
Number of MEUs
(Service) 27,620 5,487 8,890 186 4,355 50,230 96,768
Annual Water Usage
(ccf)3,226,108 734,848 1,185,208 74,408 669,145 -5,889,716
Max Month (ccf) 341,684 69,225 113,821 10,020 76,557 - 611,306
Max Day (ccf)28,891 3,864 5,963 525 7,252 -46,495
Max Hour (ccf)1,694 227 350 31 425 - 2,727
SDCWA (ccf)2,669,882 653,624 973,597 58,164 445,449 -4,800,716
Desal (ccf)556,226 81,223 211,611 16,245 223,696 - 1,089,000
Line or column totals may not tie due to rounding.
4.8.1 Potable Volumetric Cost Customer Class Allocation
Costs allocatedto the variable functional categories (Base, Max Day, Max Hour, SDCWA, and Desal) 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 Desalcosts. The elements are
allocated across the total projected FYE 2022demand and are summedto determine the total cost allocated
to each class.
4.8.1.1 BASE ALLOCATION
Base costs are allocated to each class in proportion to their share of annual water usage.
4.8.1.2 EXTRA CAPACITY ALLOCATIONS
Max Day and Max Hour costs are allocated to each class in proportion to their shares of Max Day and Max
Hour demands, respectively.
4.8.1.3 SUPPLY ALLOCATIONS
The available water supplies are allocated based on unit costs and the amount of water from each source
assigned to each customer class. Non-desalinated water from SDCWA, the lower cost source, is used first to
fulfill all base demand requirements. Desalinated water, the more expensive source, is used to fulfill the
remaining base demand requirement and subsequently 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 incremental peak
usage and in turn the upper tiers, where applicable. In practice, this means that the costs of desalinated
water are recovered from each class based on each class's incremental demands above their annual average
demands.
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Allocation proportions are based on the projected consumption from each customer class for FYE 2022. The
allocation of available supply to each customer class was performed using the two step process described
below.
Step 1: Allocate SDCWA water, and desalination water as needed,to all classes based on the
annual consumption for each class within the average use for each class. This level of
demand represents 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. Table29 shows the calculations for Step 1of the supply allocation.
Step 2: Allocate remaining desalinated water supply to all classes based on their incremental
demands above average demands. This represents each class’s incremental use above their
basic minimum needs.Table 30shows the calculations for Step 2 of the supply allocation.
As an example, Figure 3 shows the amount of consumption for the single-family customer class for Step 1
and Step 2 of the supply allocation. The total FYE 2022 projected demand for the single-family class is
3,226,108 ccfs;the average monthly demand is 268,842 ccf. In Step 1, supplies are allocated to recover the
sum of monthly usage occurring within average demands, a totalof 2,899,357 ccfs. This amount is the total
of the blue bars shown in the figure. In Step 2, supplies are allocated to cover the sum of all monthly
demands occurring above the average demands, a total of 326,751 ccfs. This amount is the total of the
orange bars. This methodology is applied to the other customer classes’ projected demands to complete the
supply allocation process.
Figure 3 Single Family Monthly Demands for Supply Allocation
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
CCFProjected Single Family Demands
Increment Within Average Use Increment Above Average Use Single Family Average
Step 2: Total amount above
average use = 326,751 ccf.
Step 1: Total amount within
average use = 2,899,357
ccf.
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Table 29 Supply Allocation – Step 1
SDCWA Desal Total
Total Supplies to be Allocated 4,800,716 1,089,000 5,889,716
Customer Class
Sum of
Monthly
Demands
within Annual
Average (ccf)
% of
Usage SDCWA Desal Total
Single Family 2,899,357 55.6%2,669,882 229,475 2,899,357
Multi-Family 709,803 13.6% 653,624 56,179 709,803
Commercial 1,057,277 20.3%973,597 83,680 1,057,277
Agricultural 63,163 1.2% 58,164 4,999 63,163
Irrigation 483,735 9.3%445,449 38,286 483,735
Total 5,213,335 100% 4,800,716 412,619 5,213,335
Line or column totals may not tie due to rounding.
Table 30 Supply Allocation – Step 2
SDCWA Desal Total
Amount Remaining to be Allocated 0 676,381 676,381
Customer Class
Annual
Usage
(ccf)
Less
Previously
Allocated
Remaining % of
Usage SDCWA Desal Total
Single Family 3,226,108 (2,899,357)326,751 54.8%0 326,751 326,751
Multi-Family 734,848 (709,803) 25,044 12.5% 0 25,044 25,044
Commercial 1,185,208 (1,057,277)127,931 20.1%0 127,931 127,931
Agricultural 74,408 (63,163) 11,246 1.3% 0 11,246 11,246
Irrigation 669,145 (483,735)185,410 11.4%0 185,410 185,410
Total 5,889,716 (5,213,335) 676,381 100% 0 676,381 676,381
Line or column totals may not tie due to rounding.
The allocations to SDCWA and Desalination from steps 1 and 2 are summed to determine the total supplies
allocated to each customer class. The costs allocated to the SDCWA and Desalination rate components are
then split between each customer class proportionally based on their allocation of water from each supply.
Table 31shows the total demand (ccf)allocated to each supply as a result of the calculations in Table29 and
Table 30.
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Table 31 Supply Allocation Summary
Customer Class SDCWA Desal Total
Single Family 2,669,882 556,226 3,226,108
Multi-Family 653,624 81,223 734,848
Commercial 973,597 211,611 1,185,208
Agricultural 58,164 16,245 74,408
Irrigation 445,449 223,696 669,145
Total 4,800,716 1,089,000 5,889,716
Line or column totals may not tie due to rounding.
4.8.2 Potable Fixed Cost Customer Class 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 MEUs. All costs
allocated to the Private Fire rate component are allocated directly to fire customers. Table 32 summarizes
the service units and the percentage allocations used to allocate fixed costs to each customer class.
Table 32 Fixed Cost Customer Allocation Factors
Customer Class # Accounts Percent
Allocation # MEUs Percent
Allocation
Private Fire
Accounts
Fire Percent
Allocation
Single Family 24,179 83.1%27,620 28.5%--
Multi-Family 1,241 4.3%5,487 5.7%--
Commercial 1,736 6.0%8,890 9.2%--
Agricultural 16 0.1% 186 0.2%--
Irrigation 813 2.8%4,355 4.5%--
Fire 1,116 3.8%50,230 51.9%1,116 100.0%
Total 29,100 100.0% 96,768 100.0% 1,116 100.0%
Line or column totals may not tie due to rounding.
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4.8.3 Potable Water Customer Allocation Results
Table 33 summarizes the total revenue requirements allocated to each potable water customer class for
FYE 2022. 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 AppendixH.
Table 33 Potable Water Customer Allocation Summary, FYE 2022 ($ millions)
Functional
Component Service Unit Single-
Family
Multi-
Family Commercial Agricultural Irrigation Fire
Customer Accounts $2.54 $0.13 $0.18 $0.00 $0.09 -
Service MEUs $6.31 $1.25 $2.03 $0.04 $1.00 -
Base Annual
Usage (ccf)$0.45 $0.10 $0.17 $0.01 $0.09 -
Max Day Max Day
Usage (ccf)$2.10 $0.28 $0.43 $0.04 $0.53 -
Max Hour Max Hour
Usage (ccf)$1.62 $0.22 $0.33 $0.03 $0.41 -
SDCWA SDCWA
Allocation $8.31 $2.04 $3.03 $0.18 $1.39 -
Desal Desal
Allocation $3.09 $0.45 $1.18 $0.09 $1.24 -
Fire MEUs - ---- $0.25
Total $24.44 $4.47 $7.36 $0.39 $4.74 $0.25
Line or column totals may not tie due to rounding.
4.8.4 Functional Cost Allocation –Recycled
4.8.4.1 FUNCTIONAL COST CATEGORIES – RECYCLED
The functional cost allocation for recycled water follows an approach similar to that laid out for potable
water in the previous sections. The allocation assigns the revenue requirement for the test year by major
function. The Study developed a list of functions specific to the District’s recycled water system. Each
functional component is allocated to specific cost components, which can then be assigned to rates. The
recycled water functional components used for the District are:
Customer Account Service:Costs for materials and outside services directly related to customer
communication such as outreach, printing, and postage.
Meters and Services:Costs associated with recycled water meters and service connections.
Administration:Costs related to the overall management and oversight of the recycled water system
including legal costs, permitting and regulatory fees, studies, and other related items. This category also
includes the costs that the recycled water utility pays to other City of Carlsbad departments for services that
they provide such as customer billing and information technology services.
Distribution:Costs associated with delivering recycled water to customers including the operation and
maintenance of the water distribution system facilities.
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Supply:The costs that the District pays to purchase recycled water from Vallecitos as well as the costs paid
to the Encina Wastewater Authority for the operation of the CWRF.
Cross Connection Control:Costs related to the District’s cross-connection control program.
Engineering:Costs related to the District’s engineering activities.
General:Costs associated with other expenses that provide an overall benefit to the water system such as
staff costs for management personnel who oversee all aspects of the water operation. This category also
includes costs that do not fit any of the other categories such as asphalt repairs, landscaping services,
miscellaneous supplies, and other overhead expenses.
4.8.4.2 O&M EXPENSE FUNCTIONALIZATION – RECYCLED
The District’s O&M expenses were functionalized into each of the above categories using the FY 2022
budgeted operating expenses. Table 34 presents a summary of the O&M cost functionalization. A detailed
table of the functionalization is included in AppendixG.
Table 34 Functionalized O&M Expenses –Recycled ($ millions)
Functional Category Personnel
Maintenance
& Equipment
Budget
Adjustments
Total
Allocated
Resulting
Allocation
Customer Account
Service $0.00 $0.01 ($0.00)$0.00 0.07%
Meters and Services $0.09 $0.20 ($0.02) $0.28 3.89%
Admin $0.06 $0.65 ($0.04)$0.68 9.46%
Distribution $0.34 $0.90 ($0.06) $1.18 16.34%
Supply $0.04 $3.86 ($0.20)$3.71 51.46%
Cross Connection Control $0.57 $0.04 ($0.03) $0.58 8.06%
Engineering $0.48 $0.01 ($0.03)$0.46 6.45%
General $0.25 $0.07 ($0.02) $0.31 4.27%
Total O&M Expenses $1.84 $5.76 ($0.39)$7.20 100.00%
Line or column totals may not tie due to rounding.
4.8.5 Rate Component Allocation –Recycled
After O&M costs are functionalized, they can be allocated to rate components along with capital costs and
other revenue requirement elements. These rate components are the foundation of the individual rates,
with each component corresponding to individual or multiple rate components.
The District’s rate components are used to allocate costs to the fixed monthly service charges and the
volumetric rates. For recycled water, the volumetric components include base, and supply. Due to the
relative homogeneity of the recycled water customer base a uniform volumetric charge is applied to all
customers, thus the extra capacity components are not necessary in the recycled water allocation. The
customer-related rate components (customer, and service)are the basis of the fixed monthly service
charges.
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4.8.5.1 RATE COMPONENT DESCRIPTIONS – RECYCLED
The following describes each of the cost components for the District.
Volumetric Components
Base:This category includes the District’s volumetric costs for delivering recycled water to customers.
Supply:This category includes the variable costs of purchasing recycled water from Vallecitos and the costs
the District pays to the Encina Wastewater Authority for the operation of the CWRF.
Fixed Components
Service:Costs associated with customer meters and service lines and the associated capacity. These costs
are included in the fixed charge based on the meter’s hydraulic capacity.
Customer:Costs related to operational support activities including accounting,administration,billing, and
customer service. These expenditures are common to all customers and are reasonably uniform across the
different customer classes.
4.8.6 Allocation of Revenue Requirements to Cost Components –Recycled
Functionalized O&M expenses and the other revenue requirement elements are allocated to the rate
categories based on the how and why the costs are incurred, and the services provided to each rate payer by
those activities. The O&M expenses and other revenue requirement elements are allocated to rate
components as follows:
Customer: These costs are considered to be equal for all customers regardlessof their water demands or the
size of their water meters and are thus allocated to the customer rate component.
Administration: These costs are fixed in nature and are allocated to the service rate component.
Meters and Services: This category includes service costs that are common to all customers as well as costs
that vary based on the size of each connection. Meters and services costs are split between the customer
and service categories. Twenty-five percentof costs are allocated to customer and 75-percent of costs are
allocated to service.
Distribution: Distribution costs are allocated to the base component.
Supply: These costs are common to all units of water sold and do not vary based on system peaking. They
are allocated to the supply rate component.
Cross Connection Control: Due to the regulatory requirements of providing recycled water service, the
recycled water system has a more extensive cross connection control program than the potable system.
These costs are allocated to the base rate component.
Engineering: The District’s engineeringefforts include planning and managing capital projects as well as
supporting operations.These costs are allocated across the rate components based on the allocation of the
recycled water system’s fixed assets.
General: These costs are for items and activities that provide a general benefit to the water system. They
are therefore allocated to the rate components based on the weighted average of O&M expenses.
Capital Costs: Capital related revenue requirements including replacement funding and transfers to the
capital replacement reserve are allocated based on the recycled water system’sfixed assets. This reflects
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that the District, as well as most utilities, spend CIP typically in accordance with the current functionalization
of the system. A summary of the allocation of fixed assets in shown in Table 36.
Offsetting Revenues and Operating Cash Flows: Offsetting revenues and cash flows are allocated based
on theweighted average allocation of all other revenue requirements.
The allocation factors used in the recycled water functional allocation are outlined in Table 35.
Table 35 Functional Allocation Factors –Recycled
Allocation Factor Customer Service Base Supply
Customer Only 100.0%
Customer and Meter Service 25.0% 75.0%
Service Only 100.0%
Base Only 100.0%
Supply Only 100.0%
Plant In Service 20.0% 60.9% 19.1%
Allocation of fixed assets as shown in Table 36.
Line or column totals may not tie due to rounding.
Table 36 Fixed Asset Allocation (Plant-in-Service) – Recycled ($ millions)
Asset Class Replacement
Value Service Base Supply
Land $65.8 20%80%0%
Buildings $11.3 20%80%0%
Water Service & Meters $24.2 20%0%80%
Total Allocation $101.30 $20.3 $61.7 $19.3
Percentage Allocation 20.0%60.9%19.1%
Line or column totals may not tie due to rounding.
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Table 37 O&M Allocation to Rate Components –Recycled ($ millions)
Operating Expenditures Customer Service Base Supply As All Others Total
Customer Account Service $0.00 ----$0.00
Meters and Services $0.07 $0.21 ---$0.28
Admin -$0.68 ---$0.68
Distribution --$1.18 --$1.18
Supply ---$3.71 -$3.71
Cross Connection Control --$0.58 --$0.58
Engineering -$0.09 $0.28 $0.09 -$0.46
General ----$0.31 $0.31
Operating Expenditures Subtotal $0.07 $0.98 $2.04 $3.80 $0.31 $7.20
Reallocation of "As All Others"$0.00 $0.04 $0.09 $0.17 ($0.31)-
Total Allocation $0.08 $1.03 $2.13 $3.97 -$7.20
Line or column totals may not tie due to rounding.
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Table 38 Revenue Requirements Allocation to Rate Components –Recycled ($ millions)
Rate Revenue Requirement Customer Service Base Supply As All Others Total
Operating Expenses $0.08 $1.03 $2.13 $3.97 -$7.20
Debt --$1.88 --$1.88
Rate Funded Capital -$0.52 $1.58 $0.49 -$2.59
Replacement Funding (Depreciation Funding) -$0.28 $0.85 $0.27 -$1.40
Transfer to Capital Fund ------
Cash Flows ----($4.75) ($4.75)
Adjustment for Mid-Year Increase ----$0.22 $0.22
Less Offsetting Revenues ----($0.00) ($0.00)
Total Rate Revenues to be Collected $0.08 $1.83 $6.44 $4.73 ($4.53)$8.54
Reallocation of "As All Others"($0.03) ($0.63)($2.23) ($1.64)$4.53 -
Total Allocation $0.05 $1.19 $4.21 $3.09 -$8.54
Line or column totals may not tie due to rounding.
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4.8.7 Functional Allocation Results –Recycled
Once each revenue requirement element is allocated, a combined allocation of the District’s expenses is
used as the basis for allocating rate revenue requirements to each functional category and subsequently to
each customer class. The functional allocation also defines the split between costs recovered through fixed
rate components and those recovered through variable rate components.
4.8.7.1 RECYCLED WATER FUNCTIONAL ALLOCATION RESULTS
The results of the recycledwater functional allocation analysis are shown in Table 39. The Service and
Customer components are collected through fixed rate components and total approximately 14.8 percent of
the District's potable costs. These costs are recovered through the monthly delivery fee. The recycledwater
usage fees recover the remaining 85.2 percent of costs, which are allocated to the Base and Supply
components.
Table 39 Functional Allocation Results Summary –Recycled ($ millions)
Allocation Basis Revenue Requirement
($ millions)
Percent of Total Functional
Allocation
Customer $0.05 0.6%
Service $1.19 14.0%
Base $4.21 49.3%
Supply $3.09 36.2%
Total Revenue Requirements $8.54 100.0%
Line or column totals may not tie due to rounding.
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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 4, 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, help 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 sectionssummarize the calculations and methodologies used to
develop the proposed rates.Additional detail of the rate design analysis is included for reference in
AppendixI.
5.2 Potable 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.
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 AWWA 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 41
presents the results of this calculation for FYE 2022.
The proposed revenue adjustments, as apercentage, do not equal or necessarily correlate to an
equivalentpercentage increase to rates or monthly bills. The results of the cost-of-service analysis and rate
design will affect users differently based on their meter size and water consumptions habits.
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Table 40 Fixed Unit Costs – Potable
Monthly Fixed Charges Customer Service
Allocated Fixed Revenue Requirements $2,945,000 $10,633,000
Accounts MEU
Customer Units 27,984 46,538
Per Account Per MEU
Monthly Unit Charges $8.77 $19.04
Table 41 Proposed Monthly Water Delivery Fees – Potable
Meter Size Meter Equivalent
Ratio
Customer
Component Service Component Total Fixed Charge
5/8"1.00 $8.77 $19.04 $27.81
3/4"1.50 $8.77 $28.56 $37.33
1"2.50 $8.77 $47.60 $56.37
1.5"5.00 $8.77 $95.20 $103.97
2"8.00 $8.77 $152.32 $161.09
2 1/2"11.50 $8.77 $218.96 $227.73
3"15.00 $8.77 $285.59 $294.37
4"25.00 $8.77 $475.99 $484.77
6"50.00 $8.77 $951.98 $960.76
8"80.00 $8.77 $1,523.17 $1,531.95
10"115.00 $8.77 $2,189.56 $2,198.33
Line or column totals may not tie due to rounding.
Table 43 summarizes the proposed fixed charges for customers with private fire line service. 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.
The total allocated revenue requirements for private fire protection are split between an amount to be
collected on a per account basis and an amount to be collected on a meter equivalent unit basis. The split
between these components is based on the detailed cost allocation. Line items that include a private fire
service allocation that are customer related are allocated to the account charge, those that are allocated to
the service component are collected via the unit component of the charge.
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Table 42 Proposed Fixed Unit Costs – Fire
Item Amount
Allocated 2022 Revenue Requirement $246,000
Percent Recovered Through Account Charges 44.2%
Number of Accounts 1,116
Monthly Fixed Charge Per Account $8.10
Recovered through Unit Charges 55.8%
Effective Number of MEUs (FY 2021)50,230
Monthly Fixed Charge Per MEU $0.23
Table 43 Proposed Monthly Water Delivery Fees – Fire
Meter Size Meter Equivalent
Ratio
Customer
Component
Service
Component Total Fixed Charge
5/8"1.00 $8.10 $0.23 $8.33
3/4"1.50 $8.10 $0.34 $8.45
1"2.50 $8.10 $0.57 $8.67
1.5"5.00 $8.10 $1.14 $9.24
2"8.00 $8.10 $1.82 $9.93
2 1/2"11.50 $8.10 $2.62 $10.72
3"15.00 $8.10 $3.41 $11.52
4"25.00 $8.10 $5.69 $13.79
6"50.00 $8.10 $11.37 $19.48
8"80.00 $8.10 $18.20 $26.30
10"115.00 $8.10 $26.16 $34.26
12”200.00 $8.10 $45.49 $53.60
Line or column totals may not tie due to rounding.
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5.3 Potable 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 of
usage. The volumetric rate for recycled customers is calculated based on the recycled water system's unique
costs.
5.3.1 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 SINGLE-FAMILY 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 Table 43 and are structured to recover Base, Max Day, and Max Hour
costs, which are costs related to internal expenditures, as well as SDCWA and Desal water purchase costs.
Based on an analysis of customer billing data, Carollo does not propose any changes to the current single-
family rate tier break structure during the five-year rate analysis period.
Table 44 Proposed Single-Family Residential Tier Allotments
Customer Class Tier Allotment
Single-Family Residential
Tier 1 10 ccf
Tier 2 18 ccf
Tier 3 > 18 ccf
The Tier 1 allotment of 10 ccf corresponds roughly to the median monthly consumption for single-family
customers and falls just below the average monthly use of 11 ccf. This level of consumption is considered to
be efficient for indoor usage and places a lower burden on the system’s infrastructure and on ongoing supply
costs due to lower peak demands. The Tier 2 incremental allotment of 8 ccf, to a total allotment of 18 ccf,
corresponds roughly to the upper 75th percentile of usage during the maximum month. This level of usage
places an incrementally higher burden on the system than tier 1, and is therefore responsible for a greater
share of peaking related costs. Usage above 18 ccf per month places the greatest burden on the system due
to the highest peaking and thus pays the highest rate.
Single-family tiered rates are calculated by allocating the rate component costs that were allocated to the
single-family customer class to each tier, then dividing the total costs allocated to each tier by the projected
consumption in each tier.The costs allocations are developed based on the demands and extra capacity
needs of each tier, as determined by an evaluation of the District billing data.
Base costs are allocated to each tier equally as they are the same for all units of water regardless of peaking.
Max Dayand Max Hour costs are allocated to each tier based on the Max Day and Max Hour extra capacity
of each tier, respectively. Billing data for single family customers was evaluated on a per-tier basis to
determine each tier’s extra capacity. A detailed summary of that evaluation is included in AppendixF.
Percentage allocations for Base, Max Day, and Max Hour costs are calculated for each component
proportional to each tier’s share of demands, Max Day, and Max Hour, as shown in Table 45.
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Table 45 Single-Family Rate Design – Base, Max Day, Max Hour
Tier FYE 2022 Demand Max Day Extra Capacity Max Hour Extra Capacity
ccf Base Alloc.ccf Alloc.ccf Alloc.
Tier 1 1,898,561 58.8%1,422,564 19.3%3,219,436 43.0%
Tier 2 575,037 17.8% 1,861,942 25.3%1,558,280 20.8%
Tier 3 752,509 23.3%4,073,690 55.4%2,706,341 36.2%
Total 3,226,108 100.0% 7,358,196 100.0% 7,484,058 100.0%
Line or column totals may not tie due to rounding.
Using the result of the supply allocation (see Table 31), supplies are allocated to fulfill the forecasted
FYE 2022 demand as summarized in Table 46. Costsfor purchased water from SDCWA and Desalination are
allocated between the three tiers by first using the lower cost source of supply, SDCWA, to satisfy demands
in the lower tiers. Once all SDCWA supplies allocated to single family have been exhausted, single family’s
share of Desalination water is used to satisfy remaining demands. The resulting percent allocation split
between the tiers is used to allocate the SDCWA and Desalination costs between Tiers 1, 2, and 3.
Table 46 Single-Family Rate Design – Supply Costs
Tier FYE 2022 Demand (ccf)SDCWA (ccf)Desal (ccf)SDCWA Desal
Tier 1 1,898,561 1,898,561 -71.1% -
Tier 2 575,037 575,037 -21.5% -
Tier 3 752,509 196,284 556,226 7.4%100.0%
Total 3,226,108 2,669,882 556,226 100.0% 100.0%
Line or column totals may not tie due to rounding.
Using thepercent allocations calculated in Table 45 and Table 46, the total revenue requirement for each
functional component is divided between Tiers1, 2, and 3. The resulting proposed FYE 2022 single-family
water usage fees are presented in Table 47. Rates for each tier are calculated by dividing the total revenue
requirements for each tier by the projected demands within each tier.
Table 47 Single-Family Rate Design Summary, FYE 2022
Functional Component
FYE 2022 Revenue
Requirement
($ millions)
Tier 1
($ millions)
Tier 2
($ millions)
Tier 3
($ millions)
Base $0.45 $0.27 $0.08 $0.11
Max Day $2.10 $0.41 $0.53 $1.17
Max Hour $1.62 $0.70 $0.34 $0.59
SDCWA $8.31 $5.91 $1.79 $0.61
Desalination $3.09 --$3.09
Total Requirements $15.58 $7.28 $2.74 $5.56
FYE 2022 Demand (ccf)1,898,561 575,037 752,509
Proposed FYE 2022 Rate $3.84/ccf $4.77/ccf $7.39/ccf
Line or column totals may not tie due to rounding.
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5.3.1.2 MULTI-FAMILY RATE DESIGN
The 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 Table 33 and are structured to recover Base, Max Day, and Max Hour
costs, which are costs related to internal expenditures, as well as SDCWA and Desal water purchase costs.
Carollo does not propose any changes to the current multi-family rate tier break structure during the five-
year rate analysis period.
Multi-family customers do not have yards and home owners associations maintain separate meters for
irrigation. On average each multi family dwelling unit uses less water than an average single-family
customer. Therefore, the tier per dwelling unit (DU) allotments for multi-family customers are lower than
per account allotments of the single-family class.The proposed monthly multi-family Tier 1 allotment per
dwelling unit remains at 5 ccf. 5 ccf ties closely to average minimum month use per dwelling unit.Any usage
above 5 ccf will be charged the multi-familyTier 2rate.
Table 48 Proposed Multi-Family Residential Tier Allotments
Customer Class Tier Allotment per
Dwelling Unit
Multi-Family Residential (per DU)Tier 1 5 ccf
Tier 2 > 5 ccf
Line or column totals may not tie due to rounding.
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 Desal water purchase costs.
Multi-family tiered rates are calculated by allocating the rate component costs that were allocated to the
multi-family customer class to each tier, then dividing the total costs allocated to each tier by the projected
consumption in each tier. The costs allocations are developed based on the demands and extra capacity
needs of each tier, as determined by an evaluation of the District billing data.
Base costs are allocated to each tier equally as they are the same for all units of water regardless of peaking.
Max Day and Max Hour costs are allocated to each tier based on the Max Day and Max Hour extra capacity
of each tier, respectively. Billing data for multi-family customers was evaluated on a per-tier basis to
determine each tier’s extra capacity. A detailed summary of that evaluation is included in AppendixF.
Percentage allocations for Base, Max Day, and Max Hour costs are calculated for each component
proportional to each tier’s share of demands, Max Day, and Max Hour, as shown in Table 49.
Table 49 Multi-Family Rate Design – Base, Max Day, Max Hour
Tier FYE 2022 Demand Max Day Extra Capacity Max Hour Extra Capacity
ccf Base Alloc.ccf Alloc.ccf Alloc.
Tier 1 589,672 80.2%370,512 54.1%970,857 74.6%
Tier 2 145,176 19.8% 314,111 45.9% 329,853 25.4%
Total 734,848 100.0% 684,623 100.0%1,300,710 100.0%
Line or column totals may not tie due to rounding.
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Using the result of the supply allocation (see Table 31), supplies are allocated to fulfill the forecasted
FYE 2022demand as summarized in Table 50. Costs for purchased water from SDCWA and Desalination are
allocated between the two tiers by first using the lower cost source of supply, SDCWA, to satisfy demands in
Tier 1, before remaining SDCWA supplies are allocated to Tier 2.Once all SDCWA supplies allocated to
multi-family have been exhausted, multi-family’s share of Desalination water is used to satisfy remaining
demands. The resulting percentallocation split between the tiers is used to allocate the SDCWA and
Desalination costs between Tiers 1 and 2.
Table 50 Multi-Family Rate Design – Supply Costs
Tier FYE 2022 Demand (ccf)SDCWA (ccf)Desal (ccf)SDCWA Desal
Tier 1 589,672 589,672 -90.2% -
Tier 2 145,176 63,953 81,223 9.8% 100.0%
Total 734,848 653,624 81,223 100.0%100.0%
Line or column totals may not tie due to rounding.
Using thepercent allocations calculated in Table 49 and Table 50, the total revenue requirement for each
functional component is divided between Tiers1 and 2. The resulting proposed FYE 2022 multi-family water
usage fees are presented in Table 51. Rates for each tier are calculated by dividing the total revenue
requirements for each tier by the projected demands within each tier.
Table 51 Multi-Family Rate Design Summary, FYE 2022
Functional Component FYE 2022 Revenue
Requirement ($ millions)
Tier 1
($/ccf)
Tier 2
($/ccf)
Base $0.10 $0.08 $0.02
Max Day $0.28 $0.15 $0.13
Max Hour $0.22 $0.16 $0.05
SDCWA $2.04 $1.84 $0.20
Desal $0.45 -$0.45
Total Requirements $3.09 $2.23 $0.86
FYE 2022 Demand (ccf)589,672 145,176
Proposed FYE 2022 Rate $3.79/ccf $5.89/ccf
Line or column totals may not tie due to rounding.
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5.3.2 Commercial, Agricultural, and Irrigation Rate Design
The water usage fee for the remaining customer classes are uniform rates charged for each ccf of
consumption. Rates are calculated for each customer class by dividing each class’s allocated share of
variable revenue requirements by its projected consumption.A summary of the rate calculation for
Commercial, Agricultural, and Irrigation customers is shown in Table 52.
Table 52 Commercial, Agricultural, and Irrigation Rate Design Summary, FYE 2022
Customer
Class
Base
($ millions)Max Day Max Hour SDCWA Desal
Total Costs
to Recover
($ millions)
Projected
Demand
(ccf)
Rate
($/ccf
)
Commercial $0.17 $0.43 $0.33 $3.03 $1.18 $5.14 1,185,208 $4.34
Agricultural $0.01 $0.04 $0.03 $0.18 $0.09 $0.35 74,408 $4.70
Irrigation $0.09 $0.53 $0.41 $1.39 $1.24 $3.66 669,145 $5.47
Line or column totals may not tie due to rounding.
5.4 Recycled Water Rates
5.4.1 Recycled Water Delivery Charges
Recycled water delivery charges are calculated using the same methodology as the potable water delivery
charges discusses previously, but with the revenue requirements and customer units of the recycled water
system. Table 53 shows the recycled water unit costs per account and per MEU.
Table 53 Fixed Unit Costs –Recycled
Monthly Fixed Charges Customer Service
Allocated Fixed Revenue Requirements $51,000 $1,193,000
Accounts MEU
Customer Units 922 5,282
Per Account Per MEU
Monthly Unit Charges $4.62 $18.83
Table 54 shows the calculation of recycled water delivery charges for FYE 2022.
Table 54 Proposed Monthly Water Delivery Fees – Recycled
Meter Size Meter Equivalent Ratio Customer Component Service
Component Total Fixed Charge
5/8"1.00 $4.62 $18.83 $23.45
3/4"1.50 $4.62 $28.24 $32.86
1"2.50 $4.62 $47.07 $51.69
1.5"5.00 $4.62 $94.13 $98.76
2"8.00 $4.62 $150.61 $155.23
2 1/2"11.50 $4.62 $216.50 $221.13
3"15.00 $4.62 $282.40 $287.02
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Meter Size Meter Equivalent Ratio Customer Component Service
Component Total Fixed Charge
4"25.00 $4.62 $470.66 $475.28
6"50.00 $4.62 $941.32 $945.95
8"80.00 $4.62 $1,506.12 $1,510.74
10"115.00 $4.62 $2,165.05 $2,169.67
Line or column totals may not tie due to rounding.
5.4.2 Recycled Water Usage Rates
Recycled water usage rates are calculated by dividing the total variable revenue requirements by the
projected recycled water demands. Table 55 shows the calculation of the recycled water usage rate for
FYE 2022.
Table 55 Recycled Water Usage Rate Design Summary, FYE 2022
Customer Class Base
($ millions)Supply
Total Costs to
Recover ($
millions)
Projected Demand
(ccf)
Rate
($/ccf)
Commercial $4.21 $3.09 $7.29 1,853,214 $3.94
Line or column totals may not tie due to rounding.
5.5 Proposed Potable Water Rates
Table 56 and Table 57 present the current and proposed potable water rates for the next two years, as well
as projected rates for FYE 2024 through FYE 2026. The FYE 2022overall annual rate adjustment of 2percent
will be implemented as a full cost-of-service adjustment and will therefore impact each rate uniquely.
FYE 2023 to FYE 2026 will have a 2percentrate revenue increase applied equally to all rates.
Table 56 Proposed Potable Water Delivery Fees
Meter Size Current FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Increase 2.0%
w/ COS Adj.2.0%2.0%2.0%2.0%
5/8" $25.52 $27.81 $28.37 $28.94 $29.52 $30.11
3/4"$34.44 $37.33 $38.08 $38.84 $39.62 $40.41
1"$52.28 $56.37 $57.50 $58.65 $59.82 $61.02
1.5"$96.88 $103.97 $106.05 $108.17 $110.34 $112.54
2" $150.40 $161.09 $164.31 $167.60 $170.95 $174.37
2 1/2"$212.84 $227.73 $232.29 $236.93 $241.67 $246.50
3" $275.28 $294.37 $300.26 $306.26 $312.39 $318.63
4"$453.68 $484.77 $494.46 $504.35 $514.44 $524.73
6" $899.69 $960.76 $979.97 $999.57 $1,019.56 $1,039.95
8"$1,434.89 $1,531.95 $1,562.59 $1,593.84 $1,625.71 $1,658.23
10" $2,059.30 $2,198.33 $2,242.30 $2,287.15 $2,332.89 $2,379.55
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Table 57 Proposed Potable Water Usage Fees
Customer Class Tier Current
($/ccf)FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Increase --
2.0%
w/ COS
Adj.
2.0%2.0%2.0%2.0%
Single Family
Residential
Tier 1 $4.13 $3.84 $3.92 $4.00 $4.08 $4.16
Tier 2 $4.51 $4.77 $4.87 $4.97 $5.06 $5.17
Tier 3 $7.18 $7.39 $7.54 $7.69 $7.84 $8.00
Multi-Family
Residential
Tier 1 $3.95 $3.79 $3.87 $3.95 $4.02 $4.10
Tier 2 $5.04 $5.89 $6.01 $6.13 $6.26 $6.38
Commercial N/A $4.36 $4.34 $4.43 $4.52 $4.61 $4.70
Agricultural N/A $4.71 $4.70 $4.80 $4.89 $4.99 $5.09
Irrigation N/A $5.41 $5.47 $5.58 $5.69 $5.81 $5.92
5.6 Proposed Recycled Water Rates
Table 58 and Table 59 present the current and proposed recycled water rates for the next two years, as well
as projected rates for FYE 2024 through FYE 2026. The FYE 2022 overall annual rate adjustment of 4percent
will be implemented as a full cost-of-service adjustment and will therefore impact each rate uniquely. FYE
2023 to FYE 2026 will have a 4percent rate revenue increase applied equally to all rates.
Table 58 Proposed Recycled Water Delivery Fees
Meter Size Current FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Increase --4.0%
w/ COS Adj.4.0%4.0%4.0%4.0%
5/8" $23.34 $23.45 $24.39 $25.36 $26.38 $27.43
3/4"$32.22 $32.86 $34.18 $35.54 $36.97 $38.44
1" $49.97 $51.69 $53.76 $55.91 $58.14 $60.47
1.5"$94.35 $98.76 $102.71 $106.81 $111.09 $115.53
2" $147.59 $155.23 $161.44 $167.90 $174.62 $181.60
2 1/2"$209.77 $221.13 $229.97 $239.17 $248.74 $258.69
3" $271.92 $287.02 $298.50 $310.44 $322.86 $335.77
4"$449.35 $475.28 $494.30 $514.07 $534.63 $556.02
6" $893.11 $945.95 $983.78 $1,023.14 $1,064.06 $1,106.62
8"$1,425.61 $1,510.74 $1,571.17 $1,634.02 $1,699.38 $1,767.35
10" $2,046.87 $2,169.67 $2,256.45 $2,346.71 $2,440.58 $2,538.20
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Table 59 Proposed Recycled Water Usage Fees
Customer Class Current
($/ccf)FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Increase --4.0%
w/ COS Adj.4.0%4.0%4.0%4.0%
Recycled $3.79 $3.94 $4.09 $4.26 $4.43 $4.61
5.7 Proposed Fire Service Rates
Table 60 presents the current and adopted fire service delivery fee rates over the next two years. The
FYE 2022overall annual rate adjustment of 2percent will be implemented as a full cost-of-service
adjustment and will therefore impact each rate uniquely. FYE 2023to FYE 2026 will have a 2percentrate
revenue increase applied equally to all rates.
Table 60 Proposed Fire Service Delivery Fees
Meter Size Current FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Increase --2.0%
w/ COS Adj.2.0%2.0%2.0%2.0%
5/8" $7.93 $8.33 $8.50 $8.67 $8.84 $9.02
3/4"$8.05 $8.45 $8.62 $8.79 $8.96 $9.14
1"$8.30 $8.67 $8.85 $9.02 $9.21 $9.39
1.5"$8.92 $9.24 $9.43 $9.62 $9.81 $10.00
2"$9.66 $9.93 $10.12 $10.33 $10.53 $10.74
2 1/2"$10.53 $10.72 $10.94 $11.15 $11.38 $11.60
3"$11.40 $11.52 $11.75 $11.98 $12.22 $12.47
4"$13.89 $13.79 $14.07 $14.35 $14.64 $14.93
6"$20.10 $19.48 $19.87 $20.26 $20.67 $21.08
8"$27.55 $26.30 $26.83 $27.36 $27.91 $28.47
10" $36.25 $34.26 $34.95 $35.65 $36.36 $37.09
12"$57.37 $53.60 $54.67 $55.76 $56.88 $58.01
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5.8 Regional Water Rate Comparison
A regional survey of single-family 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 4compares the District's existing and
proposed rates for single family residences, assuming an 11 unit water use and a 5/8" residential meter.The
5/8” meter size is the most common for the District’s customers and 11 ccf is the average monthly
consumption.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, the District's average single-family residential monthly bill is currently
$71.33.With the proposed increases, the average bill would decrease slightly by approximately $0.35 to
$70.98 due to the cost-of-service adjustment in FYE 2022. With the proposed rates for FYE 2023, the
average bill would be $72.44. Overall, the proposed rates for FYE 2022 will increase single family rate
revenues by 1.9percent, however bill increases for individual users will vary based on their consumption and
meter size.
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.
Figure 4 Regional Monthly Single-Family Water Bill Comparison – Average Customer
$70.98 $71.33 $72.44
$-
$20
$40
$60
$80
$100
$120
$140
Monthly BillAverage User Regional Monthly SFR Water Bill
Total Monthly Charge
Regional Average
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FINAL |OCTOBER 2021|56
As another point of comparison, Figure 5 compares the bill for a higher usage single family customer to the
surrounding agencies. This comparison is based on a ¾” meter and 20 ccf of consumption. This level of
consumption is equal to the average consumption in the maximum month for single family customers with
¾” meters. As shown in the figure, the District's monthly bill for this assumed user is currently $120.84. With
the proposed increases, the bill would increase to $123.43 in FYE 2022. With the proposed rates for
FYE 2023, the average bill would be $125.98.
Figure 5 Regional Monthly Single-Family Water Bill Comparison – High Use Customer
$120.84 $123.43 $125.98
$-
$50
$100
$150
$200
$250
Monthly BillHigh User Regional Monthly SFR Water Bill
Total Monthly Charge
Regional Average
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix A
CUSTOMER AND DEMAND FORECASTS
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Growth Input 0.5% 0.7% 1.0% 0.3% 0.8% 0.5% 0.6% 0.2% 0.8% 0.8% 0.5%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8 49,278 49,623 50,112 50,267 50,661 50,938 51,245 51,338 51,733 52,127 52,373
3/4 20,569 20,713 20,918 20,982 21,147 21,262 21,390 21,429 21,594 21,759 21,861
1"58,317 58,725 59,304 59,487 59,953 60,282 60,645 60,755 61,223 61,689 61,980
1.5"178,047 179,293 181,062 181,621 183,044 184,046 185,154 185,492 186,919 188,342 189,231
2"325,360 327,638 330,870 331,892 334,492 336,324 338,348 338,966 341,573 344,173 345,799
2.5"- - - - - - - - - - -
3"50,159 50,510 51,008 51,166 51,567 51,849 52,161 52,256 52,658 53,059 53,310
4"41,110 41,398 41,806 41,935 42,264 42,495 42,751 42,829 43,158 43,487 43,692
6"6,899 6,947 7,016 7,038 7,093 7,132 7,174 7,188 7,243 7,298 7,332
8"- - - - - - - - - - -
10"- - - - - - - - - - -
Total 729,739 734,848 742,095 744,388 750,220 754,329 758,868 760,253 766,101 771,933 775,580
Multi Family
Growth Input 0.5% 0.7% 1.0% 0.3% 0.8% 0.5% 0.6% 0.2% 0.8% 0.8% 0.5%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8"2,690,743 2,709,581 2,736,306 2,744,760 2,766,265 2,781,414 2,798,153 2,803,259 2,824,821 2,846,325 2,859,773
3/4"251,230 252,989 255,484 256,273 258,281 259,696 261,258 261,735 263,748 265,756 267,012
1"251,962 253,726 256,229 257,020 259,034 260,453 262,020 262,498 264,517 266,531 267,790
1.5"5,849 5,890 5,948 5,966 6,013 6,046 6,082 6,094 6,140 6,187 6,216
2"3,895 3,922 3,961 3,973 4,004 4,026 4,050 4,057 4,089 4,120 4,139
2.5"- - - - - - - - - - -
3"- - - - - - - - - - -
4"- - - - - - - - - - -
6"- - - - - - - - - - -
8"- - - - - - - - - - -
10"- - - - - - - - - - -
Total 3,203,679 3,226,108 3,257,927 3,267,993 3,293,597 3,311,634 3,331,564 3,337,644 3,363,315 3,388,919 3,404,930
Single Family
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Growth Input 0.9% 2.1% 0.2% 0.3% 0.1% 0.2% 0.3% 0.0% 1.2% 1.5% 1.6%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8 34,699 35,415 35,496 35,605 35,630 35,709 35,811 35,816 36,244 36,799 37,369
3/4 18,040 18,412 18,454 18,511 18,524 18,565 18,618 18,621 18,843 19,132 19,428
1"81,194 82,868 83,058 83,313 83,372 83,556 83,795 83,806 84,808 86,106 87,441
1.5"252,208 257,408 257,999 258,790 258,974 259,546 260,287 260,323 263,435 267,466 271,612
2"651,380 664,811 666,338 668,381 668,855 670,331 672,247 672,339 680,377 690,787 701,496
2.5"11,738 11,980 12,008 12,044 12,053 12,080 12,114 12,116 12,261 12,448 12,641
3"73,171 74,680 74,852 75,081 75,134 75,300 75,515 75,526 76,429 77,598 78,801
4"34,539 35,251 35,332 35,440 35,465 35,543 35,645 35,650 36,076 36,628 37,196
6"544 555 557 558 559 560 562 562 568 577 586
8"3,750 3,827 3,836 3,848 3,851 3,859 3,870 3,871 3,917 3,977 4,038
10"- - - - - - - - - - -
Total 1,161,263 1,185,208 1,187,929 1,191,572 1,192,417 1,195,049 1,198,464 1,198,629 1,212,958 1,231,516 1,250,609
Commercial/
Institutional/Other
Growth Input 0.5% 0.7% 1.0% 0.3% 0.8% 0.5% 0.6% 0.2% 0.8% 0.8% 0.5%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8 - - - - - - - - - - -
3/4 624 628 634 636 641 645 649 650 655 660 663
1"1,134 1,142 1,153 1,157 1,166 1,172 1,179 1,182 1,191 1,200 1,205
1.5"580 584 590 592 596 600 603 604 609 614 617
2"6,310 6,354 6,417 6,437 6,487 6,523 6,562 6,574 6,625 6,675 6,707
2.5"- - - - - - - - - - -
3"17,120 17,240 17,410 17,464 17,601 17,697 17,803 17,836 17,973 18,110 18,195
4"48,123 48,460 48,938 49,089 49,473 49,744 50,044 50,135 50,521 50,905 51,146
6"- - - - - - - - - - -
8"- - - - - - - - - - -
10"- - - - - - - - - - -
Total 73,891 74,408 75,142 75,374 75,965 76,381 76,841 76,981 77,573 78,163 78,533
Agricultural
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Growth Input 0.5% 0.7% 1.0% 0.3% 0.8% 0.5% 0.6% 0.2% 0.8% 0.8% 0.5%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8 9,113 9,177 9,267 9,296 9,369 9,420 9,477 9,494 9,567 9,640 9,685
3/4 7,721 7,775 7,851 7,876 7,937 7,981 8,029 8,044 8,105 8,167 8,206
1"70,696 71,191 71,894 72,116 72,681 73,079 73,519 73,653 74,219 74,784 75,138
1.5"200,508 201,912 203,904 204,534 206,136 207,265 208,512 208,893 210,500 212,102 213,104
2"325,215 327,492 330,722 331,744 334,343 336,174 338,197 338,814 341,420 344,020 345,645
2.5"- - - - - - - - - - -
3"- - - - - - - - - - -
4"39,143 39,417 39,806 39,929 40,241 40,462 40,705 40,780 41,093 41,406 41,602
6"12,096 12,181 12,301 12,339 12,436 12,504 12,579 12,602 12,699 12,796 12,856
8"- - - - - - - - - - -
10"- - - - - - - - - - -
Total 664,493 669,145 675,745 677,833 683,143 686,885 691,018 692,280 697,604 702,915 706,236
Irrigation
Growth Input 0.5% 0.7% 1.0% 0.3% 0.8% 0.5% 0.6% 0.2% 0.8% 0.8% 0.5%
FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031
5/8 576 580 585 587 592 595 599 600 604 609 612
3/4 5,202 5,238 5,290 5,306 5,348 5,377 5,409 5,419 5,461 5,502 5,528
1"162,197 163,332 164,943 165,453 166,749 167,662 168,671 168,979 170,279 171,575 172,386
1.5"562,742 566,682 572,271 574,039 578,537 581,705 585,206 586,274 590,783 595,281 598,093
2"691,872 696,716 703,588 705,762 711,291 715,187 719,491 720,804 726,348 731,877 735,335
2.5"- - - - - - - - - - -
3"33,757 33,993 34,328 34,434 34,704 34,894 35,104 35,168 35,439 35,709 35,877
4"42,133 42,428 42,847 42,979 43,316 43,553 43,815 43,895 44,233 44,570 44,780
6"212,108 213,593 215,699 216,366 218,061 219,255 220,575 220,977 222,677 224,372 225,432
8"129,743 130,651 131,940 132,347 133,384 134,115 134,922 135,168 136,208 137,245 137,893
10"- - - - - - - - - - -
Total 1,840,329 1,853,214 1,871,492 1,877,274 1,891,982 1,902,344 1,913,792 1,917,285 1,932,032 1,946,740 1,955,937
Recycled Water
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix B
WATER SUPPLY PURCHASES AND COSTS
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Water Purchases Escalators
Customer Service Charge Increase (2)(3)5.00%5.00%5.00%5.00%5.00%
Emergency Storage Charge Increase (2)(3)2.00%2.00%2.00%2.00%2.00%
Infrastructure Access Charge Increase (2) (3)1.00%1.00%1.00%1.00%1.00%
Supply Reliability Charge Increase (2)(3)5.00%5.00%5.00%5.00%5.00%
MWD Capacity Reservation Charge Increase (2)(3)3.00%3.00%3.00%3.00%3.00%
MWD Readiness to Service Charge Increase 6.00%6.00%6.00%6.00%6.00%
Transportation Rate Increase (3)5.00%5.00%5.00%5.00%5.00%
SDCWA M&I Melded Supply Rate Increase (3)6.00%6.00%6.00%6.00%6.00%
SDCWA Melded Treatment Rate Increase (3)2.00%2.00%2.00%2.00%2.00%
Desal - Fixed Capital Increase (1)2.50%2.50%2.50%2.50%2.50%
Desal - Fixed Financing Increase (1)9.70%9.70%9.70%9.70%9.70%
Desal - Fixed O&M Increase (1)2.50%2.50%2.50%2.50%2.50%
Desal - Fixed Electricity Increase (1)2.50%2.50%2.50%2.50%2.50%
Desal - Variable O&M Increase (1)2.50%2.50%2.50%2.50%2.50%
Desal - Variable Electricity Increase (1)3.00%3.00%3.00%3.00%3.00%
Desal - Conveyance Cost Increase (1)2.50%2.50%2.50%2.50%2.50%
Desal - Indirect Costs Increase (1)1.50%1.50%1.50%1.50%1.50%
Desal - T.O. Inefficiency Increase (1)6.00%6.00%6.00%6.00%6.00%
Desal - Wheeling Increase (1)5.00%5.00%5.00%5.00%5.00%
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
SDCWA/MWD Purchases
Water Consumption Override
Water Purchases (AF)12,177 12,299 12,345 12,440 12,512
Water Purchases (ccf)5,304,160 5,357,481 5,377,369 5,418,816 5,450,224
Water Purchasee (MGD)10.87 10.98 11.02 11.11 11.17
Customer Data (ccf)5,889,716 5,938,839 5,957,160 5,995,343 6,024,278
System Loss (input)8.5%8.5%8.5%8.5%8.5%
System Loss (calculated)4,800,716 4,849,839 4,868,160 4,906,343 4,935,278
Fixed Charges (CY) (1,2,3)CY 2022 CY 2023 CY 2024 CY 2025 CY 2026
Customer Service Charge 821,100$ 862,155$ 905,263$ 950,526$ 998,052$
Emergency Storage Charge 2,084,796 2,126,492 2,169,022 2,212,402 2,256,650
Infrastructure Access Charge 1,861,044 1,879,654 1,898,451 1,917,435 1,936,610
Supply Reliability Charge 1,352,460 1,420,083 1,491,087 1,565,642 1,643,924
MWD Capacity Reservation Charge 293,856 302,672 311,752 321,104 330,738
MWD Readiness to Service Charge (FY basis)397,800 421,668 446,968 473,786 502,213
Fixed Charges (FY)
Customer Service Charge 807,150$ 841,628$ 883,709$ 927,894$ 974,289$
Emergency Storage Charge 2,047,662 2,105,644 2,147,757 2,190,712 2,234,526
Infrastructure Access Charge 1,857,888 1,870,349 1,889,053 1,907,943 1,927,023
Supply Reliability Charge 1,350,210 1,386,272 1,455,585 1,528,364 1,604,783
MWD Capacity Reservation Charge 287,640 298,264 307,212 316,428 325,921
MWD Readiness to Service Charge 397,800 421,668 446,968 473,786 502,213
Total Fixed Charges (FY)6,748,350$ 6,923,824$ 7,130,283$ 7,345,128$ 7,568,755$
Fixed per AF $554 $563 $578 $590 $605
-1%2%3%2%2%
Variable Charges (CY) (1,2,3)CY 2022 CY 2023 CY 2024 CY 2025 CY 2026
Transportation Rate 173$ 182$ 191$ 200$ 210$
SDCWA M&I Melded Supply Rate 1,009 1,070 1,134 1,202 1,274
SDCWA Melded Treatment Rate 310 316 323 329 336
CWA Drought Fee
Variable Price per AF 1,492$ 1,567$ 1,647$ 1,731$ 1,820$
Total Variable Costs (FY)17,516,149$ 18,813,849$ 19,840,212$ 21,010,647$ 22,212,882$
Total SDCWA & MWD Charges (FY)$24,264,499 $25,737,673 $26,970,495 $28,355,775 $29,781,637
DESAL PURCHASES
Contract Desal Water, Min. 2500 AF (1,5) 2,500 2,500 2,500 2,500 2,500
Additional desal water, AF (1)- - - - -
Total Desal (AF)2,500 2,500 2,500 2,500 2,500
In ccf 1,089,000 1,089,000 1,089,000 1,089,000 1,089,000
Fixed Charges ($/AF), Calendar Year (4,5)CY 2022 CY 2023 CY 2024 CY 2025 CY 2026
Capital, Debt Service Charge $1,812.49 $1,857.80 $1,904.24 $1,951.85 $2,000.65
Capital, Equity Return Charge 0.00 0.00 0.00 0.00 0.00
Fixed O&M 0.00 0.00 0.00 0.00 0.00
Fixed Electrictiy 0.00 0.00 0.00 0.00 0.00
Variable Charges ($/AF) (4,5)
Variable O&M $793.53 $813.37 $833.71 $854.55 $875.91
Variable Electricity 0.00 0.00 0.00 0.00 0.00
Other Costs ($/AF) (4,5)
Conveyance (Pipeline Debt Payment)$221.46 $227.00 $232.67 $238.49 $244.45
Indirect Costs (2)33.04 33.53 34.04 34.55 35.07
Administration Charge 10.80 11.45 12.14 12.86 13.64
Wheeling (Transportation Charge Including credits) (2)0.00 0.00 0.00 0.00 0.00
Fixed Costs ($)
Capital 4,531,218$ 4,644,498$ 4,760,610$ 4,879,626$ 5,001,616$
Financing - - - - -
Fixed O&M - - - - -
Fixed Electrictiy - - - - -
Variable Costs ($)
Variable O&M 1,983,836$ 2,033,432$ 2,084,268$ 2,136,375$ 2,189,784$
Variable Electricity - - - - -
Other Costs ($)
Conveyance 553,654$ 567,495$ 581,682$ 596,225$ 611,130$
Indirect Costs 82,596 83,835 85,092 86,368 87,664
T.O. Inefficiency 27,004 28,624 30,341 32,162 34,091
Wheeling (Transportation Charge Including credits)- - - - -
Total Desal Costs, CY (3)7,178,307$ 7,357,883$ 7,541,994$ 7,730,755$ 7,924,286$
Desal Costs (FY Basis)7,090,728$ 7,268,095$ 7,449,939$ 7,636,374$ 7,827,520$
Recycled Water Purchases
Assumptions
Leucadia Price (% of Potable Water) (1)No Purchases No Purchases No Purchases No Purchases No Purchases
Potable Water Cost 1,439$ 1,530$ 1,607$ 1,689$ 1,775$
Vallecitos Annual Escalation 3%3%3%3%3%
Reclaimed Water Increases
Expected AF to be Sold (Historical Sales &Customer Data)4,254 4,296 4,310 4,343 4,367
System Losses 5%5%5%5%5%
Recycled Water to be Purchased 4,467 4,511 4,525 4,561 4,586
Source of Supply (in AF)
Leucadia Wastewater District (LWD)- - - - -
Vallecitos Water District (VWD)2,386 2,386 2,386 2,386 2,386
Carlsbad Water Recycling Facility (CWRF)2,081 2,125 2,139 2,174 2,199
Total Recycled Water (AF)4,467 4,511 4,525 4,561 4,586
5-year moving average #N/A #N/A #N/A 4,500 4,530
Unit Costs
Leucadia Wastewater District (LWD)-$ -$ -$ -$ -$
Vallecitos Water District (VWD)951$ 979$ 1,009$ 1,039$ 1,070$
Purchase Amount
Leucadia Wastewater District (LWD)-$ -$ -$ -$ -$
Vallecitos Water District (VWD)2,268,646$ 2,336,705$ 2,406,806$ 2,479,010$ 2,553,381$
Outside RW Purchases 2,268,646$ 2,336,705$ 2,406,806$ 2,479,010$ 2,553,381$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
DESAL PURCHASES
Contract Desal Water, Min. 2500 AF (1,5) 2,500 2,500 2,500 2,500 2,500
Additional desal water, AF (1)- - - - -
Total Desal (AF)2,500 2,500 2,500 2,500 2,500
In ccf 1,089,000 1,089,000 1,089,000 1,089,000 1,089,000
Fixed Charges ($/AF), Calendar Year (4,5)CY 2022 CY 2023 CY 2024 CY 2025 CY 2026
Capital, Debt Service Charge $1,812.49 $1,857.80 $1,904.24 $1,951.85 $2,000.65
Capital, Equity Return Charge 0.00 0.00 0.00 0.00 0.00
Fixed O&M 0.00 0.00 0.00 0.00 0.00
Fixed Electrictiy 0.00 0.00 0.00 0.00 0.00
Variable Charges ($/AF) (4,5)
Variable O&M $793.53 $813.37 $833.71 $854.55 $875.91
Variable Electricity 0.00 0.00 0.00 0.00 0.00
Other Costs ($/AF) (4,5)
Conveyance (Pipeline Debt Payment)$221.46 $227.00 $232.67 $238.49 $244.45
Indirect Costs (2)33.04 33.53 34.04 34.55 35.07
Administration Charge 10.80 11.45 12.14 12.86 13.64
Wheeling (Transportation Charge Including credits) (2)0.00 0.00 0.00 0.00 0.00
Fixed Costs ($)
Capital 4,531,218$ 4,644,498$ 4,760,610$ 4,879,626$ 5,001,616$
Financing - - - - -
Fixed O&M - - - - -
Fixed Electrictiy - - - - -
Variable Costs ($)
Variable O&M 1,983,836$ 2,033,432$ 2,084,268$ 2,136,375$ 2,189,784$
Variable Electricity - - - - -
Other Costs ($)
Conveyance 553,654$ 567,495$ 581,682$ 596,225$ 611,130$
Indirect Costs 82,596 83,835 85,092 86,368 87,664
T.O. Inefficiency 27,004 28,624 30,341 32,162 34,091
Wheeling (Transportation Charge Including credits)- - - - -
Total Desal Costs, CY (3)7,178,307$ 7,357,883$ 7,541,994$ 7,730,755$ 7,924,286$
Desal Costs (FY Basis)7,090,728$ 7,268,095$ 7,449,939$ 7,636,374$ 7,827,520$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Recycled Water Purchases
Assumptions
Leucadia Price (% of Potable Water) (1)No Purchases No Purchases No Purchases No Purchases No Purchases
Potable Water Cost 1,439$ 1,530$ 1,607$ 1,689$ 1,775$
Vallecitos Annual Escalation 3%3%3%3%3%
Reclaimed Water Increases
Expected AF to be Sold (Historical Sales &Customer Data)4,254 4,296 4,310 4,343 4,367
System Losses 5%5%5%5%5%
Recycled Water to be Purchased 4,467 4,511 4,525 4,561 4,586
Source of Supply (in AF)
Leucadia Wastewater District (LWD)- - - - -
Vallecitos Water District (VWD)2,386 2,386 2,386 2,386 2,386
Carlsbad Water Recycling Facility (CWRF)2,081 2,125 2,139 2,174 2,199
Total Recycled Water (AF)4,467 4,511 4,525 4,561 4,586
5-year moving average #N/A #N/A #N/A 4,500 4,530
Unit Costs
Leucadia Wastewater District (LWD)-$ -$ -$ -$ -$
Vallecitos Water District (VWD)951$ 979$ 1,009$ 1,039$ 1,070$
Purchase Amount
Leucadia Wastewater District (LWD)-$ -$ -$ -$ -$
Vallecitos Water District (VWD)2,268,646$ 2,336,705$ 2,406,806$ 2,479,010$ 2,553,381$
Outside RW Purchases 2,268,646$ 2,336,705$ 2,406,806$ 2,479,010$ 2,553,381$
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix C
CAPITAL IMPROVEMENT PLAN
WATER CONNECTION PROJECTS FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Include Project Number Project Title Expansion Replacement
50131 College Boulevard - Cannon Road To Badger Lane (375 Zone)100%0%250,000$ 844,817$
50121 College Boulevard - Cannon Road To Badger Lane (490 Zone)100%0%300,000 1,160,000
50381 Desalinated Water Flow Control Facility No. 5 100%0%1,056,749 8,200,000
50591 Hydroelectric Generation at Water Facilities 100%0%400,000 1,875,000
50451 Poinsettia Lane - Cassia Road to Skimmer Court (Reimbursement Agreement)100%0%595,066
19621 Rancho Carlsbad Groundwater Supply 100%0%400,000 125,000
50441 San Luis Rey Mission Basin Groundwater Supply 100%0%277,500 300,000
50581 Water Modeling 100%0%189,591 25,000 25,000 25,000
WATER CONNECTION PROJECTS TOTAL:3,468,906$ 4,329,817$ 25,000$ 8,225,000$ -$
SUMMARY OF WATER CONNECTION PROJECTS UNESCALATED ESCALATED FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
5-YEAR CIP (2022-2026)UNESCALATED
R&R -$ -$ R&R -$ -$ -$ -$ -$
Expansion 16,048,723 17,096,252 Expansion 3,468,906 4,329,817 25,000 8,225,000 -
TOTAL:16,048,723$ 17,096,252$ Total 3,468,906$ 4,329,817$ 25,000$ 8,225,000$ -$
10-YEAR CIP (2022-2031)ESCALATED
R&R -$ -$ R&R -$ -$ -$ -$ -$
Expansion 22,973,723 25,917,216 Expansion 3,468,906 4,481,361 26,781 9,119,205 -
TOTAL:22,973,723$ 25,917,216$ Total 3,468,906$ 4,481,361$ 26,781$ 9,119,205$ -$
TOTAL CIP (2022-2035)
R&R -$ -$
Expansion 24,973,723 28,890,013
TOTAL:24,973,723$ 28,890,013$
WATER REPLACEMENT PROJECTS FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Include Project Number Project Title Expansion Replacement
52051 Abandon Potable Services (New Recycled Services)0%100%51,153$ 50,000$ 500,000$ 500,000$
50601 Aviara Parkway and Plum Tree Waterline 0%100%200,000 200,000 900,500
50481 Carlsbad Boulevard Waterline Replacement at Terramar 0%100%627,894 2,800,000
52031 Carlsbad Water Recycling Facility (Encina Capital Projects)0%100%-
50071 Cathodic Protection Program 0%100%1,437,014 190,000 190,000 190,000 190,000
50331 Crestview Drive Transmission Main 0%100%300,000 500,000
50431 Fire Flow Capacity System Improvements 0%100%- 1,710,000 100,000 100,000
50351 Limited Access Pipeline Relocation Program 0%100%329,446 900,000 729,446 2,000,000 1,000,000
50091 Maerkle Facility Improvements 0%100%940,113
50361 Maerkle Reservoir Floating Cover Replacement 0%100%586,996
50011 Maerkle Reservoir Transmission Main 0%100%600,348 1,000,000 4,557,000
50501 Normally Closed Valve (Install Motorized Valve)0%100%481,089
35722 Orion Center 0%100%695,050
50551 Palomar Airport Waterline Realignment 0%100%1,456,894
50201 Pressure Reducing Station Program 0%100%2,831,352 600,000 600,000 600,000 600,000
50612 Rancho Carlsbad Groundwater Supply 0%100%400,000 125,000
50271 Recycled Water Line - Carlsbad Water Recycling Facility to Agua Hedionda Lagoon 0%100%303,763
52081 Recycled Water Phase 3 - Pipelines 0%100%305,295
52101 Recycled Water Phase 3 - Reservoir 0%100%942,784
50241 Reservoir Repair and Maintenance Program 0%100%2,039,904 1,960,000
50442 San Luis Rey Mission Basin Groundwater Supply 0%100%77,500
50571 Santa Fe II Inlet Pipeline 0%100%- 495,000 2,370,000
50461 Santa Fe II Reservoir Site Electrical Improvements 0%100%25,000
55422 SCADA Improvements 0%100%250,000 300,000 5,000,000 3,000,000 295,000
50081 Tri-Agency Water Transmission Pipeline Replacement 0%100%1,500,000 1,418,015 1,418,015
60192 Valley & Magnolia sidewalks 0%100%63,260
50511 Water Infrastructure Condition Assessment Program 0%100%1,632,153 410,000 410,000 420,000 420,000
50521 Water Loss Monitoring Program 0%100%250,687 50,000 100,000 100,000 100,000
39041 Water System Rehabilitation and Replacement 0%100%2,673,849 2,690,000 2,800,000 3,000,000 3,000,000
50191 Water Valve Repair/Replacement Program 0%100%1,742,236 940,000 960,000 960,000 960,000
0%100%
WATER REPLACEMENT PROJECTS TOTAL: 22,743,780$ 12,123,015$ 21,879,961$ 13,240,000$ 7,165,000$
SUMMARY OF WATER REPLACEMENT PROJECTS UNESCALATED ESCALATED FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
5-YEAR CIP (2022-2026)Unescalated
R&R 77,151,756$ 81,630,889$ R&R 22,743,780$ 12,123,015$ 21,879,961$ 13,240,000$ 7,165,000$
Expansion - - Expansion -$ -$ -$ -$ -$
TOTAL:77,151,756$ 81,630,889$ Total 22,743,780$ 12,123,015$ 21,879,961$ 13,240,000$ 7,165,000$
10-YEAR CIP (2022-2031)Escalated
R&R 118,920,756$ 134,835,633$ R&R 22,743,780$ 12,547,321$ 23,438,361$ 14,679,425$ 8,222,002$
Expansion - - Expansion - - - - -
TOTAL:118,920,756$ 134,835,633$ Total 22,743,780$ 12,547,321$ 23,438,361$ 14,679,425$ 8,222,002$
TOTAL CIP (2022-2035)
R&R 150,200,756$ 181,330,172$
Expansion - -
TOTAL:150,200,756$ 181,330,172$
SUMMARY OF WATER DISTRIBUTION SYSTEM FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
5-YEAR CIP (2022-2026)Unescalated
R&R 77,151,756$ 81,630,889$ R&R 22,743,780$ 12,123,015$ 21,879,961$ 13,240,000$ 7,165,000$
Expansion 16,048,723 17,096,252 Expansion 3,468,906 4,329,817 25,000 8,225,000 -
TOTAL:93,200,479$ 98,727,141$ Total 26,212,686$ 16,452,832$ 21,904,961$ 21,465,000$ 7,165,000$
10-YEAR CIP (2022-2031)Escalated
R&R 118,920,756$ 134,835,633$ R&R 22,743,780$ 12,547,321$ 23,438,361$ 14,679,425$ 8,222,002$
Expansion 22,973,723 25,917,216 Expansion 3,468,906 4,481,361 26,781 9,119,205 -
TOTAL:141,894,479$ 160,752,850$ Total 26,212,686$ 17,028,681$ 23,465,142$ 23,798,629$ 8,222,002$
TOTAL CIP (2022-2035)
R&R 150,200,756$ 186,357,722$
Expansion 24,973,723 28,890,013
TOTAL:175,174,479$ 215,247,735$
RECYCLED WATER REPLACEMENT PROJECTS FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Include Project Number Project Title Expansion Replacement
52032 Carlsbad Water Recycling Facility (Encina Capital Projects)0%100%3,322,054$ 315,000$ 320,000$ 310,000$ 200,000$
52131 Carlsbad Water Recycling Facility Irrigation and Landscape 0%100%175,000$
Carlsbad Water Recycling Facility Roof Replacement 0%100%450,000$
35725 Orion Center 0%100%278,000$
52111 Recycled Water Condition Assessment Program 0%100%683,619$ 50,000 50,000 50,000 50,000
Recycled Water Pipeline Replacement 0%100%-$ 350,000 350,000 350,000
52121 Recycled Water Valve and Appurtenance Replacement Program 0%100%260,000$ 120,000 120,000
55423 SCADA Improvements 0%100%87,000$ 100,000 500,000 400,000 300,000
Recycled Water Line - Carlsbad Water Recycling Facility to Agua Hedionda Lagoon 100%0%(44,342)$
52082 Recycled Water Phase 3 - Pipelines 100%0%650,000$
52102 Recycled Water Phase 3 - Reservoir 100%0%2,708,913$
RECYCLED WATER REPLACEMENT PROJECTS TOTAL:8,570,244$ 585,000$ 1,220,000$ 1,230,000$ 900,000$
SUMMARY OF RECYCLED WATER REPLACEMENT PROJECTS UNESCALATED ESCALATED FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
5-YEAR CIP (2022-2026)Unescalated
R&R 9,190,673$ 9,564,536$ R&R 5,255,673$ 585,000$ 1,220,000$ 1,230,000$ 900,000$
Expansion 3,314,571 3,314,571 Expansion 3,314,571 - - - -
TOTAL:12,505,244$ 12,879,107$ Total 8,570,244$ 585,000$ 1,220,000$ 1,230,000$ 900,000$
10-YEAR CIP (2022-2031)Escalated
R&R 13,450,673$ 14,990,862$ R&R 5,255,673$ 605,475$ 1,306,895$ 1,363,723$ 1,032,771$
Expansion 3,314,571 3,314,571 Expansion 3,314,571 - - - -
TOTAL:16,765,244$ 18,305,433$ Total 8,570,244$ 605,475$ 1,306,895$ 1,363,723$ 1,032,771$
TOTAL CIP PROJECT SUMMARY (COMBINED Potable Water and Recycled Water)UNESCALATED ESCALATED FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
TOTAL CIP (2022-2035)Unescalated
R&R 167,827,429$ 202,528,234$ 85.58%R&R 23,099,961$ 14,470,000$ 8,065,000$ 9,205,800$ 9,205,800$
Expansion 28,288,294 32,204,584 14.42%Expansion 25,000 8,225,000 - 1,385,000 1,385,000
Total CIP 196,115,723$ 234,732,818$ Total 23,124,961$ 22,695,000$ 8,065,000$ 10,590,800$ 10,590,800$
TOTAL 5-YEAR CIP (2022-2026)Escalated
R&R 86,342,429$ 91,195,425$ 81.68%R&R 24,745,256$ 16,043,148$ 9,254,773$ 10,933,603$ 11,316,279$
Expansion 19,363,294 20,410,823 18.32%Expansion 26,781 9,119,205 - 1,644,946 1,702,519
Total 5-Year CIP 105,705,723$ 111,606,248$ Total 24,772,036$ 25,162,352$ 9,254,773$ 12,578,548$ 13,018,797$
TOTAL 10-YEAR CIP (2022-2031)
R&R 132,371,429$ 149,826,496$ 83.43%
Expansion 26,288,294 29,231,787 16.57%
Total 10-Year CIP 158,659,723$ 179,058,283$
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix D
PROJECTED O&M COSTS
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
REVENUES Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Charges for Services
4885 Plan Check General Inflation -$ -$ -$ -$ -$
4976 Special Benefit District Servc General Inflation - - - - -
4995 Admin Fees General Inflation - - - - -
5100 Commodity Usage Cust. Grwth + Usage Grwth 28,288,971 29,048,358 29,772,564 30,533,284 31,193,016
5101 Water Delivery Charges Customer Growth 12,541,986 12,878,662 13,199,740 13,537,007 13,829,501
5110 New Account Charges Gnrl Infltn + Cstmr Dmnd Grwth 132,416 136,615 140,691 144,974 148,826
5111 Backflow Device Gnrl Infltn + Cstmr Dmnd Grwth 138,859 143,262 147,536 152,028 156,068
5113 Quick Turnon Fees Gnrl Infltn + Cstmr Dmnd Grwth 5,456 5,629 5,797 5,973 6,132
5115 Scheduled Disconnect Fee Gnrl Infltn + Cstmr Dmnd Grwth 4,350 4,488 4,622 4,763 4,889
5124 Service Installation Fees Gnrl Infltn + Cstmr Dmnd Grwth 42,600 43,951 45,262 46,640 47,879
5125 Misc Conn Chg Gnrl Infltn + Cstmr Dmnd Grwth - - - - -
5127 Non Jurisdictional Fees Gnrl Infltn + Cstmr Dmnd Grwth - - - - -
Other Charges for Services Gnrl Infltn + Cstmr Dmnd Grwth - - - - -
Total Charges for Services 41,154,638$ 42,260,965$ 43,316,212$ 44,424,669$ 45,386,312$
323,681$ 333,945$ 343,908$
Developer Fees
Developer Connection Fees [ Calculated ]
Other Developer Fees General Inflation - - - - -
Total Developer Fees -$ -$ -$ -$ -$
Tax Revenues
4010 Adjustments - Current Taxes General Inflation -$ -$ -$ -$ -$
4011 Property Taxes - Current Property Tax Increase 3,465,441 3,593,316 3,697,881 3,806,969 3,929,553
4012 Refunds - Current Taxes General Inflation - - - - -
4015 Supplemental Property Taxes Property Tax Increase 41,438 42,967 44,217 45,522 46,988
4016 Refunds - Supplemental Taxes General Inflation - - - - -
4018 Unitary Tax (combine w/4011)General Inflation 27,968 28,667 29,384 30,118 30,871
4020 Prior Years Property Taxes Property Tax Increase 33,828 35,076 36,097 37,162 38,358
4021 Refunds - Prior Year Taxes General Inflation (18,520) (18,983) (19,458) (19,944) (20,443)
4027 Surplus Property Tax Increment Property Tax Increase 130,344 135,154 139,087 143,190 147,800
4111 Sales and Use tax General Inflation - - - - -
Other Tax Revenues General Inflation - - - - -
Total Tax Revenues 3,680,499$ 3,816,197$ 3,927,209$ 4,043,017$ 4,173,128$
Licenses and Permits
4452 Fire Protect Sys General Inflation -$ -$ -$ -$ -$
Other Licenses and Permits General Inflation - - - - -
Total Licenses and Permits -$ -$ -$ -$ -$
Intergovernmental
4525 Homeowners Exemption General Inflation 7,401$ 7,586$ 7,776$ 7,970$ 8,169$
4632 Federal Grants - Capital One Time Expense - - - - -
4753 SDCWA/MWD Credits One Time Expense - - - - -
4754 SDCWA Rebates One Time Expense - - - - -
Other Intergovernmental General Inflation - - - - -
Total Intergovernmental 7,401$ 7,586$ 7,776$ 7,970$ 8,169$
Fines & Forfeitures
5221 Reconnect Fees General Inflation 1,365$ 1,399$ 1,434$ 1,470$ 1,507$
5212 Code Violations General Inflation - - - - -
5222 Return Check Fee General Inflation 3,000 3,075 3,152 3,231 3,311
5225 Late Charges General Inflation 96,903 99,326 101,809 104,354 106,963
5226 Door Hanger Fee General Inflation 3,383 3,468 3,554 3,643 3,734
5229 Misc Fines General Inflation - - - - -
Other Fines & Forfeitures General Inflation - - - - -
Total Fines & Forfeitures 104,651$ 107,267$ 109,949$ 112,698$ 115,515$
Income from Prop & Investments
5300 Interest Income - Pooled Cash Interest Income 368,799$ 377,650$ 387,091$ 396,769$ 406,688$
5305 Interest - Unrealized Gains/Losses General Inflation - - - - -
5315 Interest Income - Property Tax Interest Income 6,098 6,244 6,400 6,560 6,724
5320 Facilities Rentals General Inflation - - - - -
5341 Other Rentals and Leases General Inflation 46,980 48,155 49,358 50,592 51,857
5342 Cell Site Leases General Inflation 215,249 220,630 226,146 231,800 237,595
5360 Sale of Capital Assets General Inflation - - - - -
5361 Donated Assets One Time Expense - - - - -
5362 Scrap & Recycle General Inflation - - - - -
Other Income from Prop & Investments General Inflation - - - - -
Total Income from Prop & Investments 637,126$ 652,679$ 668,996$ 685,721$ 702,864$
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Interdepartmental
5430 Eng Labor General Inflation 40,000$ 41,000$ 42,025$ 43,076$ 44,153$
5442 Reimbursed Work for Other Dept.General Inflation 5,000 5,125 5,253 5,384 5,519
Other Interdepartmental General Inflation - - - - -
Total Interdepartmental 45,000$ 46,125$ 47,278$ 48,460$ 49,672$
Other Revenues
5542 Major Facilities General Inflation -$ -$ -$ -$ -$
5550 Prior Year Fee Refunds General Inflation - - - - -
5632 Str Lights/Signs General Inflation - - - - -
5634 Misc Damages General Inflation - - - - -
5636 Loss Recovery General Inflation 49,000 50,225 51,481 52,768 54,087
5638 Misc Reimbursement Losses General Inflation - - - - -
5639 Misc Reimbursement Expenses General Inflation - - - - -
5664 Misc AR Write Offs General Inflation - - - - -
5674 Misc Revenues General Inflation 36,000 36,900 37,823 38,768 39,737
Other Other Revenues General Inflation - - - - -
Total Other Revenues 85,000$ 87,125$ 89,303$ 91,536$ 93,824$
Other Financing Sources
5900 Transfers In No Annual Increase -$ -$ -$ -$ -$
Other Other Financing Sources General Inflation - - - - -
Total Other Financing Sources -$ -$ -$ -$ -$
TOTAL REVENUES 45,714,315$ 46,977,945$ 48,166,723$ 49,414,070$ 50,529,485$
CHECK (from data) 45,466,455
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
EXPENDITURES Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Personnel
6100 Reg Salaries Labor Inflation 2,662,637$ 2,742,517$ 2,824,792$ 2,909,536$ 2,996,822$
6101 Incentive Pay Labor Inflation - - - - -
6140 Other Personnel Labor Inflation - - - - -
6150 IOD Worker's Comp Labor Inflation - - - - -
6200 Overtime Salaries Labor Inflation 110,000 113,300 116,699 120,200 123,806
6210 Standby Pay Labor Inflation 24,000 24,720 25,462 26,225 27,012
6300 Parttime Salaries Labor Inflation 18,776 19,339 19,919 20,517 21,133
6305 Intern Salaries Labor Inflation 7,429 7,652 7,881 8,118 8,361
6310 Elected Officials' Salaries Labor Inflation 7,000 7,210 7,426 7,649 7,879
6400 Temporary Help Labor Inflation 40,000 41,200 42,436 43,709 45,020
6501 Health Insurance Labor - Health Insurance 505,472 540,249 576,067 612,820 650,386
6510 Life Insurance Labor Inflation 1,860 1,916 1,973 2,033 2,094
6511 AD&D City Paid Labor Inflation 931 959 987 1,017 1,047
6520 Vision Insurance Labor Inflation - - - - -
6530 Medicare Labor Inflation 40,825 42,050 43,311 44,610 45,949
6620 MTG Physicals Labor Inflation - - - - -
6629 Cell Phone Allowance Labor Inflation - - - - -
6630 Auto Allowance Labor Inflation 1,625 1,674 1,724 1,776 1,829
6640 Earned Leave Accrual Labor Inflation - - - - -
6651 Healthy Emp Awards Labor Inflation - - - - -
6653 Final Vacation Pay Labor Inflation 35,000 36,050 37,132 38,245 39,393
6654 Final Sick Leave Pay Labor Inflation - - - - -
6655 Disability Labor Inflation 24,092 24,814 25,559 26,326 27,115
6656 Unemployment Labor Inflation 13,361 13,761 14,174 14,599 15,037
6657 Worker's Compensation Labor Inflation 50,210 51,716 53,268 54,866 56,512
6720 PERS Labor - PERS (Normal Cost)323,511 362,012 372,873 384,059 395,580
6720 PERS UAL Exp Labor - PERS (UAL)453,612 470,610 493,166 503,166
6721 PERS (GASB 68 Contra Account)Labor - PERS (Normal Cost)- - - - -
PERS - Repayment Labor - PERS (UAL)- - - - -
6722 OPEB Expense One Time Expense - - - - -
6723 PERS Unfunded Liability Expense Labor - PERS (Normal Cost)310,869 351,903 398,354 450,937 510,461
6730 Social Security Labor Inflation - - - - -
6740 Deferred Comp Labor Inflation 705 726 748 770 793
6741 Def Comp Match Labor Inflation - - - - -
Other Personnel Labor Inflation - - - - -
Total Personnel Costs 4,178,302$ 4,837,380$ 5,041,396$ 5,261,179$ 5,479,397$
Maintenance & Equipment
7110 Office Equip Rental General Inflation 500$ 513$ 525$ 538$ 552$
7111 Other Mach & Equip General Inflation 2,000 2,050 2,101 2,154 2,208
7115 Vehicle Rentals General Inflation 17,150 17,579 18,018 18,469 18,930
7119 Misc Rentals General Inflation 14,000 14,350 14,709 15,076 15,453
7120 Misc Leases General Inflation - - - - -
7210 Office Equip Maintenance General Inflation - - - - -
7211 Communication Equip Maintenance General Inflation 3,000 3,075 3,152 3,231 3,311
7215 Software Maintenance General Inflation 50,000 51,250 52,531 53,845 55,191
7216 Computer Maintenance General Inflation - - - - -
7220 Vehicle Maint General Inflation 30,000 30,750 31,519 32,307 33,114
7221 Wash and Wax General Inflation 23,450 24,036 24,637 25,253 25,884
7222 Other Equip Maintenance General Inflation 100 103 105 108 110
7225 Car Wash Repairs General Inflation - - - - -
7226 Pipeline Maintenance General Inflation 234,500 240,363 246,372 252,531 258,844
7227 Fire Hydrant Maintenance - City General Inflation 21,000 21,525 22,063 22,615 23,180
7228 FIRE HYDRANT MAINTENANCE - OTHER General Inflation 25,000 25,625 26,266 26,922 27,595
7230 Routine Building Maintenance General Inflation 5,000 5,125 5,253 5,384 5,519
7241 Asphalt Repairs General Inflation 50,000 51,250 52,531 53,845 55,191
7244 Street Sweeping General Inflation - - - - -
7249 Maintenance, Repair and Rehab General Inflation 10,000 10,250 10,506 10,769 11,038
7400 Audit General Inflation - - - - -
7410 Legal General Inflation 70,000 71,750 73,544 75,382 77,267
7435 Administrative General Inflation 45,000 46,125 47,278 48,460 49,672
7480 Claims Admin General Inflation - - - - -
7490 Misc Professional Services General Inflation 521,500 534,538 547,901 561,598 575,638
7500 Encina Services General Inflation - - - - -
7510 City Generated General Inflation - - - - -
7511 Citizen Generated General Inflation - - - - -
7550 Miscellaneous Outside Services General Inflation 500,100 512,603 525,418 538,553 552,017
7551 Bank Services General Inflation 38,600 39,565 40,554 41,568 42,607
7552 Book Binding General Inflation - - - - -
7553 Comm Arts Support General Inflation - - - - -
7554 Regulatory/Permitting Fees General Inflation 143,400 146,985 150,660 154,426 158,287
7556 Misc Services General Inflation - - - - -
***PassThru Charges 7557 Customer Service Charge [ Calculated ]807,150 841,628 883,709 927,894 974,289
7557 Emergency Storage Charge [ Calculated ]2,047,662 2,105,644 2,147,757 2,190,712 2,234,526
7557 Infrastructure Access Charge [ Calculated ]1,857,888 1,870,349 1,889,053 1,907,943 1,927,023
7557 Supply Reliability Charge [ Calculated ]1,350,210 1,386,272 1,455,585 1,528,364 1,604,783
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
7557 MWD Capacity Reservation Charge [ Calculated ]287,640 298,264 307,212 316,428 325,921
7557 MWD Readiness to Service Charge [ Calculated ]397,800 421,668 446,968 473,786 502,213
7558 Laundry and Uniform Maintenance General Inflation 8,000 8,200 8,405 8,615 8,831
7559 Electrical/Scada Services General Inflation 85,000 87,125 89,303 91,536 93,824
7560 Water Sampling Services General Inflation 147,500 151,188 154,967 158,841 162,812
7561 Water Conservation Services General Inflation 22,500 23,063 23,639 24,230 24,836
7564 Landscaping Services General Inflation 93,000 95,325 97,708 100,151 102,655
7710 Ads and Publishing General Inflation 500 513 525 538 552
7711 Dues and Subscriptions General Inflation 42,500 43,563 44,652 45,768 46,912
7712 Books and Publications General Inflation 1,200 1,230 1,261 1,292 1,325
7713 Audio-Visual Materials General Inflation - - - - -
7715 Printing General Inflation 15,000 15,375 15,759 16,153 16,557
7720 Postage General Inflation 7,000 7,175 7,354 7,538 7,727
7725 Office Supplies General Inflation 11,000 11,275 11,557 11,846 12,142
7726 Office Furniture & Equipment General Inflation 15,000 15,375 15,759 16,153 16,557
7730 Computer Software General Inflation 10,000 10,250 10,506 10,769 11,038
7731 Misc. Computer Hardware General Inflation 5,000 5,125 5,253 5,384 5,519
7735 Promo Materials General Inflation 6,000 6,150 6,304 6,461 6,623
7741 Preschool General Inflation - - - - -
7745 Food Expense General Inflation - - - - -
7750 Heat and Light Utilities Inflation 126,270 132,584 139,213 146,173 153,482
7751 Telephone & Communications Utilities Inflation 13,600 14,280 14,994 15,744 16,531
7752 Waste Disposal Services Utilities Inflation 12,000 12,600 13,230 13,892 14,586
7753 Water Utilities Inflation 17,000 17,850 18,743 19,680 20,664
7801 Building Maintenance General Inflation - - - - -
7810 Electrical Supplies General Inflation - - - - -
7811 Janitorial Supplies General Inflation - - - - -
7812 Sign Materials General Inflation - - - - -
7820 Parts-Vehicles General Inflation - - - - -
7821 Parts-Equip General Inflation 223,000 228,575 234,289 240,147 246,150
7830 Rock and Mineral Products General Inflation 15,000 15,375 15,759 16,153 16,557
7831 Asphalt General Inflation 5,000 5,125 5,253 5,384 5,519
7850 Small Tools General Inflation 5,000 5,125 5,253 5,384 5,519
7851 Safety Equipment General Inflation 25,000 25,625 26,266 26,922 27,595
7852 Uniforms and Accessories General Inflation 4,000 4,100 4,203 4,308 4,415
7853 Meters/Fittings - New Development General Inflation 106,000 108,650 111,366 114,150 117,004
7863 Meters/Fittings - Replacement General Inflation 136,000 139,400 142,885 146,457 150,119
7855 Fire Hose and Appliances General Inflation - - - - -
7856 Rescue Equipment General Inflation - - - - -
7857 Personal Protective Equipment General Inflation - - - - -
7858 Breathing Apparatus Equipment General Inflation - - - - -
7865 Automated Meter Program General Inflation - - - - -
7880 Gasoline and Oil Utilities Inflation 2,000 2,100 2,205 2,315 2,431
7881 Propane General Inflation 500 513 525 538 552
7882 Other Petrol Products General Inflation - - - - -
7883 Chemicals Chemicals Inflation 33,000 34,650 36,383 38,202 40,112
7890 CMWD Purc Water-Outside Agency [ Calculated ]17,516,149 18,813,849 19,840,212 21,010,647 22,212,882
7892 Desal Costs [ Calculated ]7,090,728 7,268,095 7,449,939 7,636,374 7,827,520
7899 Misc Supplies General Inflation 45,000 46,125 47,278 48,460 49,672
8110 Employee Training General Inflation 6,000 6,150 6,304 6,461 6,623
8120 Tuition Reimbursement General Inflation - - - - -
8130 Training/Training Related Travel General Inflation 4,500 4,613 4,728 4,846 4,967
8500 Depreciation Depreciation Funding 4,500,000 4,553,550 4,606,827 4,660,266 4,713,859
8510 Prop Taxes PD General Inflation 5,000 5,125 5,253 5,384 5,519
8520 Conference Travel General Inflation 1,500 1,538 1,576 1,615 1,656
8522 Misc. Meals/Miles General Inflation 7,000 7,175 7,354 7,538 7,727
8530 Bad Debt Exp - Other Inv/Bills General Inflation 47,850 49,046 50,272 51,529 52,817
8532 Disposal of Assets One Time Expense - - - - -
8534 Reg Over/Short General Inflation - - - - -
8610 Settlements General Inflation - - - - -
8615 Interest on Deposit General Inflation - - - - -
8621 Interfund Services General Inflation - - - - -
8699 Misc Expenditures General Inflation - - - - -
8700 Contingencies General Inflation - - - - -
8809 Vehicle Direct Charges General Inflation 34,003 34,853 35,724 36,618 37,533
8810 Vehicle Maintenance General Inflation 160,512 164,525 168,638 172,854 177,175
8811 Vehicle Replacement General Inflation 178,609 183,074 187,651 192,342 197,151
8820 Street Lighting General Inflation - - - - -
8822 Median Maintenance General Inflation - - - - -
8830 General Lab General Inflation 158,530 162,493 166,556 170,719 174,987
8840 Copy Services General Inflation - - - - -
8855 Records Management Interdept General Inflation - - - - -
8860 Information Technologies General Inflation 632,427 648,238 664,444 681,055 698,081
8890 Misc Interdepartmental Charges General Inflation 1,805,116 1,850,244 1,896,500 1,943,912 1,992,510
8891 Mis Chg Back General Inflation - - - - -
8892 Utility Billing Chargeback General Inflation - - - - -
8910 Fiscal Agent Fees General Inflation - - - - -
8911 Arbitrage Costs General Inflation - - - - -
8912 Misc Debt Expense General Inflation - - - - -
8920 Principal [ Calculated ]- - - - -
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
8921 Interest Expense [ Calculated ]- - - - -
8922 Int Exp-Capitalized Interest General Inflation - - - - -
8930 Amortization Expense General Inflation - - - - -
8931 Issuance Costs General Inflation - - - - -
Other No Annual Increase - - - - -
Additional Maintenance & Equipment [ Calculated Below ](1,705,116) (1,840,752) (1,901,466) (1,965,515) (2,030,038)
Total Maintenance & Equipment Costs 40,233,029$ 41,958,652$ 43,527,235$ 45,253,996$ 47,030,151$
Capital Outlay
9003 Non-Budgeted Cap Equip <$10K General Inflation -$ -$ -$ -$ -$
9005 Capital Outlay <$10K New General Inflation - - - - -
9006 Capital Outlay < $10K - Repl General Inflation - - - - -
9010 Cap Outlay - Vehicles General Inflation - - - - -
9020 Computer Equip > $10K - Repl General Inflation - - - - -
9021 Office Equipment General Inflation - - - - -
9022 Other Equipment General Inflation - - - - -
9030 Office Furniture General Inflation - - - - -
9040 Reclass Capital Outlay General Inflation - - - - -
9050 Capitalized Assets One Time Expense - - - - -
Other Capital Outlay General Inflation - - - - -
Total Capital Outlay Costs -$ -$ -$ -$ -$
Other Financing Uses
9999 Transfers Out One Time Expense 4,000,000$ -$ -$ -$ -$
Other Other Financing Uses General Inflation - - - - -
Total Other Financing Uses Costs 4,000,000$ -$ -$ -$ -$
Total Expenditures 48,411,331$ 46,796,032$ 48,568,631$ 50,515,175$ 52,509,547$
CHECK (from data) 52,321,219
Rate Revenues Without Increases FOR REFERENCE - DOSE NOT IMPACT MODEL CALCULATIONS
Commodity Usage Cust. Grwth + Usage Grwth 26,603,537$ 26,782,039$ 26,911,513$ 27,057,971$ 27,100,600$
Water Delivery Charges Customer Growth 12,250,496 12,332,694 12,392,314 12,459,756 12,479,385
Total Rate Revenues Without Increases $38,854,033 $39,114,733 $39,303,827 $39,517,726 $39,579,985
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
REVENUES Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Charges for Services
5100 Commodity Usage Customer Growth 7,023,679$ 7,353,639$ 7,684,756$ 8,035,641$ 8,370,233$
5101 Water Delivery Charges Customer Growth 1,186,865 1,242,622 1,298,575 1,357,867 1,414,407
5110 New Acct Charges Gnrl Infltn + Cstmr Dmnd Grwth 1,120 1,156 1,190 1,226 1,259
5111 Backflow Device Gnrl Infltn + Cstmr Dmnd Grwth 186 192 198 204 209
5113 Quick Turnon Fees Gnrl Infltn + Cstmr Dmnd Grwth - - - - -
5115 SCHEDULED DISCONNET FEE Gnrl Infltn + Cstmr Dmnd Grwth 40 41 42 44 45
5124 Service Installation Fees Gnrl Infltn + Cstmr Dmnd Grwth - - - - -
5115,17 Other General Inflation - - - - -
Total Charges for Services 8,211,891$ 8,597,649$ 8,984,761$ 9,394,982$ 9,786,153$
Developer Fees
Developer Connection Fees [ Calculated ]-$ -$ -$ -$ -$
5542 Major Facilities General Inflation - - - - -
Total Developer Fees -$ -$ -$ -$ -$
Intergovernmental (CWA)
4592 State Grants - Capital General Inflation -$ -$ -$ -$ -$
4632 Federal Grants - Capital One Time Expense - - - - -
4753 SDCWA/MWD Credits [ Calculated ]- - - - -
Other Intergovernmental (CWA)General Inflation - - - - -
Total Intergovernmental (CWA)-$ -$ -$ -$ -$
Fines and Forfeitures
5221 Reconnect Fees General Inflation -$ -$ -$ -$ -$
5222 Return Check Fee General Inflation 50 51 53 54 55
5225 Late Charges General Inflation 4,181 4,286 4,393 4,502 4,615
5226 Door Hanger Fee General Inflation - - - - -
5342 Cell Site Leases General Inflation -
Other Fines and Forfeitures General Inflation - - - - -
Total Fines and Forfeitures 4,231$ 4,337$ 4,445$ 4,556$ 4,670$
Income from Property & Investments
5300 Interest Income - Pooled Cash Interest income (23,389)$ -$ -$ -$ -$
5305 Interest-Unrealzd Gains/Losses General Inflation - - - - -
5310 Interest Income Frm Othr Inv General Inflation - - - - -
5360 Sale of Capital Assets General Inflation - - - - -
5361 Donated Assets One Time Expense - - - - -
Other Income from Property & Investments General Inflation - - - - -
Total Income from Property & Investments (23,389)$ -$ -$ -$ -$
Interdepartmental
5430 Eng Labor General Inflation 20,000$ 20,500$ 21,013$ 21,538$ 22,076$
5442 Reimbursed Work for Other Dept.General Inflation - - - - -
Other Interdepartmental General Inflation - - - - -
Total Interdepartmental 20,000$ 20,500$ 21,013$ 21,538$ 22,076$
Other Revenues
5550 Prior Year Fee Refunds General Inflation -$ -$ -$ -$ -$
5639 Misc Reimbursement Exp.General Inflation - - - - -
5674 Misc Revenues General Inflation - - - - -
5664 Misc AR Write Offs General Inflation -
Other Other Revenues General Inflation - - - - -
Total Other Revenues -$ -$ -$ -$ -$
Other Financing Sources
5900 Transfers In No Annual Increase -$ -$ -$ -$ -$
Other Other Financing Sources General Inflation - - - - -
Total Other Financing Sources -$ -$ -$ -$ -$
TOTAL REVENUES 8,212,733$ 8,622,486$ 9,010,219$ 9,421,076$ 9,812,899$
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
EXPENDITURES Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Projection (Pre-
Rate Increase)
Personnel
6100 Reg Salaries Labor Inflation 1,217,881$ 1,254,418$ 1,292,050$ 1,330,812$ 1,370,736$
6101 Incentive Pay Labor Inflation - - - - -
6140 Other Personnel Labor Inflation - - - - -
6150 IOD Worker's Comp Labor Inflation - - - - -
6200 Overtime Salaries Labor Inflation 30,000 30,900 31,827 32,782 33,765
6210 Standby Pay Labor Inflation 4,000 4,120 4,244 4,371 4,502
6300 Parttimes Salaries Labor Inflation 9,388 9,670 9,960 10,259 10,566
6305 Intern Salaries Labor Inflation 3,716 3,827 3,942 4,061 4,182
6310 Elected Officials' Salaries Labor Inflation - - - - -
6620 Mgt Physicals Labor Inflation -
6400 Temproary Help Labor Inflation - - - - -
6501 Health Insurance Labor - Health Insurance 211,460 226,008 240,993 256,368 272,083
6510 Life Insurance Labor Inflation 882 908 935 963 992
6511 AD&D - City Paid Labor Inflation 441
6520 Vision Insurance Labor Inflation - - - - -
6530 Medicare Labor Inflation 18,290 18,838 19,404 19,986 20,585
6629 Cell Phone Allowance Labor Inflation - - - - -
6630 Auto Allowance Labor Inflation 488 503 518 533 549
6640 Earned Leave Accrual Labor Inflation - - - - -
6651 Healthy Emp Awards Labor Inflation - - - - -
6653 Final Vacation Pay Labor Inflation 14,000 14,420 14,853 15,298 15,757
6654 Final Sick Leave Pay Labor Inflation - - - - -
6655 Disability Labor Inflation 11,021 11,352 11,692 12,043 12,404
6656 Unemployment Labor Inflation 6,114 6,297 6,486 6,681 6,881
6657 Worker's Compensation Labor Inflation 21,890 22,547 23,223 23,920 24,637
6720 PERS Labor - PERS (Normal Cost)147,973 165,583 170,551 175,667 180,937
PERS - Repayment Labor - PERS (Normal Cost)- 207,481 215,256 225,573 230,147
6722 OPEB Expense Labor Inflation - -
6723 PERS Unfunded Liability Exp Labor - PERS (Normal Cost)142,158 160,922 182,164 206,210 233,430
6730 Social Security Labor Inflation - - - - -
6740 Deffered Comp Labor Inflation 353 364 374 386 397
6741 Def Comp Match Labor Inflation - - - - -
Other Personnel Labor Inflation - - - - -
Total Personnel Costs 1,840,054$ 2,138,158$ 2,228,471$ 2,325,911$ 2,422,553$
Maintenance & Equipment
7110 Office Equp Rental General Inflation -$ -$ -$ -$ -$
7111 Other Mach & Equip General Inflation - - - - -
7119 Misc Rentals General Inflation 500 513 525 538 552
7120 Misc Leases General Inflation - - - - -
7210 Office Equip Maintenance General Inflation - - - - -
7211 Communication Equip Maintenance General Inflation - - - - -
7215 Software Maintenance General Inflation 1,700 1,743 1,786 1,831 1,876
7216 Computer Maintenance General Inflation -
7220 Vehicle Maint General Inflation - - - - -
7221 Wash and Wax General Inflation 1,500 1,538 1,576 1,615 1,656
7222 Other Equip Maintenance General Inflation 500 513 525 538 552
7225 Car Wash Repairs General Inflation -
7226 Pipeline Maintenance General Inflation 55,000 56,375 57,784 59,229 60,710
7227 FIRE HYDRANT MAINT - CITY General Inflation 5,000 5,125 5,253 5,384 5,519
7230 Routine Building Mainteance General Inflation 1,000 1,025 1,051 1,077 1,104
7241 Asphalt Repairs General Inflation 1,000 1,025 1,051 1,077 1,104
7249 Maintenance, Repair and Rehab General Inflation 3,243 3,324 3,407 3,492 3,580
7400 Audit General Inflation - - - - -
7410 Legal General Inflation - - - - -
7435 Administrative General Inflation - - - - -
7480 Claims Admin General Inflation - - - - -
7490 Misc Professional Services General Inflation 188,480 193,192 198,022 202,972 208,047
7500 Encina Services General Inflation 1,575,000 1,614,375 1,654,734 1,696,103 1,738,505
7500 Encina Services (Pension Payoff)No Annual Increase - (71,778) (73,704) (75,823) (78,002)
7510 City Generated General Inflation - - - - -
7511 Citizen Generated General Inflation - - - - -
7550 Miscellaneous Outside Services General Inflation 191,000 195,775 200,669 205,686 210,828
7551 Bank Services General Inflation 1,200 1,230 1,261 1,292 1,325
7552 Book Binding General Inflation - - - - -
7554 Regulatory/Permitting Fees General Inflation 30,000 30,750 31,519 32,307 33,114
7556 Misc Services General Inflation - - - - -
7557 MWD/CWA Fixed Charges General Inflation - - - - -
7558 Laundry and Uniform Mainteance General Inflation 3,000 3,075 3,152 3,231 3,311
7559 Electrical/SCADA services General Inflation 35,000 35,875 36,772 37,691 38,633
7564 Landscaping Services General Inflation 22,000 22,550 23,114 23,692 24,284
7710 Ads and Publishing General Inflation - - - - -
7711 Dues and Subscriptions General Inflation 8,300 8,508 8,720 8,938 9,162
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
7712 Books and Publications General Inflation 500 513 525 538 552
7713 Audio-Visual Materials General Inflation - - - - -
7715 Printing General Inflation 4,000 4,100 4,203 4,308 4,415
7720 Postage General Inflation 1,000 1,025 1,051 1,077 1,104
7725 Office Supplies General Inflation 1,000 1,025 1,051 1,077 1,104
7726 Office Furniture & Equipment General Inflation 2,500 2,563 2,627 2,692 2,760
7730 Computer Software General Inflation 5,000 5,125 5,253 5,384 5,519
7731 Misc. Computer Hardware General Inflation 2,000 2,050 2,101 2,154 2,208
7735 Promo Materials General Inflation 1,000 1,025 1,051 1,077 1,104
7741 Preschool General Inflation - - - - -
7750 Heat and Light Utilities Inflation 329,400 345,870 363,164 381,322 400,388
7751 Telephone & Communications Utilities Inflation 900 945 992 1,042 1,094
7752 Waste Dispoal Services Utilities Inflation - - - - -
7753 Water Utilities Inflation 4,500 4,725 4,961 5,209 5,470
7801 Building Maintenance General Inflation - - - - -
7810 Electrical Supplies General Inflation 500 513 525 538 552
7811 Janitorial Supplies General Inflation - - - - -
7820 Parts-Vehicles General Inflation -
7821 Parts-Equip General Inflation 67,500 69,188 70,917 72,690 74,507
7830 Rock and Mineral Products General Inflation 1,000 1,025 1,051 1,077 1,104
7831 Asphalt General Inflation 1,000 1,025 1,051 1,077 1,104
7850 Small Tools General Inflation 600 615 630 646 662
7851 Safety Equipment General Inflation 16,900 17,323 17,756 18,199 18,654
7852 Uniforms and Accessories General Inflation 3,000 3,075 3,152 3,231 3,311
7853 Meters/Fittings - New General Inflation 23,700 24,293 24,900 25,522 26,160
7863 Meters/Fittings - Replacement General Inflation 20,000 20,500 21,013 21,538 22,076
7855 Fire Hose and Appliances General Inflation - - - - -
7856 Rescue Equipment General Inflation - - - - -
7857 Personal Protective Equipment General Inflation - - - - -
7858 Breathing Apparatus Equipment General Inflation - - - - -
7860 Shooting Range Supplies General Inflation - - - - -
7880 Gasoline and Oil Utilities Inflation - - - - -
7883 Chemicals General Inflation -
7890 CMWD Purc Water-Outside Agency General Inflation 2,268,646 2,336,705 2,406,806 2,479,010 2,553,381
7891 CMWD Purch Water-From City Utilities Inflation 18,000 18,900 19,845 20,837 21,879
7899 Misc Supplies General Inflation 7,000 7,175 7,354 7,538 7,727
8110 Employee Training General Inflation 750 769 788 808 828
8120 Tuition Reimbursement General Inflation - - - - -
8130 Training/Training Related Travel General Inflation 6,000 6,150 6,304 6,461 6,623
8500 Depreciation Depreciation Funding 1,400,000 1,416,660 1,433,235 1,449,860 1,466,534
Depreciation - Phase III Expansion Construction Inflation - - - - -
8510 Prop Taxes PD General Inflation - - - - -
8520 Conference/Meeting Travel General Inflation 500 513 525 538 552
8522 Misc. Meals/Miles General Inflation 4,500 4,613 4,728 4,846 4,967
8530 Bad Debt Exp - Other Inv/Bills General Inflation 2,900 2,973 3,047 3,123 3,201
8534 Reg Over/Short General Inflation - - - - -
8610 Settlements General Inflation - - - - -
8612 Prior Period Adjustment One Time Expense - - - - -
8614 Repayments General Inflation - - - - -
8615 Interest on Deposit General Inflation - - - - -
8699 Misc Expenditures General Inflation - - - - -
8700 Contingencies General Inflation - - - - -
8809 Vehicle Direct Charges General Inflation -
8810 Vehicle Mainteance General Inflation 20,940 21,464 22,000 22,550 23,114
8811 Vehicle Replacement General Inflation 25,931 26,579 27,244 27,925 28,623
8820 Street Lighting General Inflation - - - - -
8822 Median Maintenace General Inflation - - - - -
8830 General Liab General Inflation 61,130 62,658 64,225 65,830 67,476
8855 Records Management Interdept General Inflation - - - - -
8860 Information Technologies General Inflation 152,514 156,327 160,235 164,241 168,347
8890 Misc Interdepartmental Charges General Inflation 577,147 591,576 606,365 621,524 637,062
8891 Mis Chg Back General Inflation - - - - -
8892 Utility Billing Chargeback General Inflation - - - - -
8910 Fiscal Agent Fees General Inflation - - - - -
8911 Arbitrage Costs General Inflation - - - - -
8920 Principal [ Calculated ]1,659,000 2,295,671 2,346,586 2,398,658 1,805,054
8921 Interest Expense [ Calculated ]218,000 601,472 550,556 498,484 445,229
8922 Int Exp-Capitalized Interest One Time Expense - - - - -
Other General Inflation - - - - -
Additional Maintenance & Equipment [ Calculated Below ](390,465) (398,275) (406,240) (414,365) (422,652)
Total Maintenance & Equipment Costs 8,641,915$ 9,763,178$ 9,938,792$ 10,119,141$ 9,657,652$
CODE LINE ITEM ESCALATOR FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
Capital Outlay
9006 Non-Budgeted Cap Equip <$10K General Inflation -$ -$ -$ -$ -$
9005 Capital Outlay <$10K New General Inflation - - - - -
9010 Cap Outlay - Vehicles General Inflation - - - - -
9020 Computer Equip > $10K - Repl General Inflation - - - - -
9021 Office Equipment General Inflation - - - - -
9022 Other Equipment General Inflation - - - - -
9050 Capitalized Assets One Time Expense - - - - -
9060 Capital Projects One Time Expense - - - - -
Other Capital Outlay General Inflation - - - - -
Total Capital Outlay Costs -$ -$ -$ -$ -$
Other Financing Uses
9999 Transfers Out One Time Expense -$ -$ -$ -$ -$
Other Other Financing Uses General Inflation - - - - -
Total Other Financing Uses Costs -$ -$ -$ -$ -$
TOTAL EXPENDITURES 10,481,969$ 11,901,336$ 12,167,263$ 12,445,051$ 12,080,204$
Rate Revenues Without Increases
Commodity Usage Customer Growth 6,298,912 6,341,176 6,371,831 6,406,508 6,416,601
Water Delivery Charges Customer Growth 1,201,465 1,209,527 1,215,374 1,221,988 1,223,913
Total Rate Revenues Without Increases 7,500,377$ 7,550,702$ 7,587,205$ 7,628,496$ 7,640,514$
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix E
REVENUE REQUIREMENT ANALYSIS
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
CASH FLOW TEST
REVENUES
Commodity Charges 28,288,970$ 29,048,360$ 29,772,560$ 30,533,280$ 31,193,020$
Delivery Charges 12,541,990 12,878,660 13,199,740 13,537,010 13,829,500
Non-Rate Charges for Services 323,680 333,940 343,910 354,380 363,790
Developer Fees - - - - -
Tax Revenues 3,680,500 3,816,200 3,927,210 4,043,020 4,173,130
Licenses and Permits - - - - -
Intergovernmental 7,400 7,590 7,780 7,970 8,170
Fines & Forfeitures 104,650 107,270 109,950 112,700 115,520
Income from Prop & Investments 637,130 652,680 669,000 685,720 702,860
Interdepartmental 45,000 46,130 47,280 48,460 49,670
Other Revenues 85,000 87,130 89,300 91,540 93,820
Other Financing Sources - - - - -
TOTAL REVENUES 45,714,320$ 46,977,960$ 48,166,730$ 49,414,080$ 50,529,480$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
EXPENDITURES
Ongoing Operating Expenses
Personnel 4,178,302$ 4,837,380$ 5,041,396$ 5,261,179$ 5,479,397$
Maintenance & Equipment (w/o depreciation)35,733,029 37,405,102 38,920,408 40,593,730 42,316,292
Capital Outlay - - - - -
Other Financing Uses - - - - -
Other Operating Expenses
Debt Service - - - - -
Rate-Funded Capital - - - - -
Total Operating Expenditures 39,911,331$ 42,242,482$ 43,961,805$ 45,854,909$ 47,795,689$
Policy Expenditures
Replacement Funding 4,500,000$ 4,553,550$ 4,606,827$ 4,660,266$ 4,713,859$
Transfer to Capital Fund 4,000,000 - - - -
Additions to Meet Minimum Fund Balances - - - - -
Total Policy Expenditures 8,500,000$ 4,553,550$ 4,606,827$ 4,660,266$ 4,713,859$
TOTAL for Cash Flow Test 48,411,331$ 46,796,032$ 48,568,631$ 50,515,175$ 52,509,547$
CASH FLOW SURPLUS (DEFICIT)(2,697,011)$ 181,928$ (401,901)$ (1,101,095)$ (1,980,067)$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
DEBT COVERAGE TEST
1.25 x Bond Coverage
REVENUES
Water Revenues 45,714,320$ 46,977,960$ 48,166,730$ 49,414,080$ 50,529,480$
Water Connection Fee Revenues Allowed
Total Revenues 45,714,320$ 46,977,960$ 48,166,730$ 49,414,080$ 50,529,480$
EXPENDITURES
Water Expenditures 39,911,331$ 42,242,482$ 43,961,805$ 45,854,909$ 47,795,689$
Debt Service - - - - -
Coverage - - - - -
Total Expenditures 39,911,331$ 42,242,482$ 43,961,805$ 45,854,909$ 47,795,689$
BOND COVERAGE SURPLUS (DEFICIT)5,802,989$ 4,735,478$ 4,204,925$ 3,559,171$ 2,733,791$
REVENUE REQUIREMENT
Revenue Shortfalls (2,697,011)$ 181,928$ (401,901)$ (1,101,095)$ (1,980,067)$
Cash Flow Driven Surplus Cash Flow Driven Cash Flow Driven Cash Flow Driven
Month of implementation March January January January January
Calculated Revenue Increase (%)19.82%0.00%1.87%5.00%8.80%
Revenue Increase Override (INPUT in Dashboard)2.00%2.00%2.00%2.00%2.00%
Implemented Rate Increase 2.00%2.00%2.00%2.00%2.00%
Cumulative Rate Increase 12.5%14.7%17.0%19.4%21.8%
SFR Rate $27.81 $28.37 $28.93 $29.51 $30.10
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026
CASH FLOW
Revenues Before Rate Increase 45,714,320$ 46,977,960$ 48,166,730$ 49,414,080$ 50,529,480$
Revenues From Rate Increase 816,619 838,540 859,446 881,406 900,450
LESS: Rate Increase Delay (544,413) (419,270) (429,723) (440,703) (450,225)
LESS: Expenditures (48,411,331) (46,796,032) (48,568,631) (50,515,175) (52,509,547)
Cash Flow (2,424,805)$ 601,198$ 27,822$ (660,392)$ (1,529,842)$
Total Available Fund - Potable Water
Beginning Balance 120,695,327$ 102,801,186$ 93,727,737$ 77,160,731$ 59,513,370$
Ending Fund Balance 102,801,186 93,727,737 77,160,731 59,513,370 55,541,211
Fund change (17,894,141)$ (9,073,449)$ (16,567,007)$ (17,647,360)$ (3,972,159)$
941 Days 810 Days 641 Days 474 Days 424 Days
Operating Fund - Potable Water
Beginning Balance 26,403,277$ 15,964,532$ 16,565,730$ 16,593,552$ 15,933,160$
Cash Flow (2,424,805) 601,198 27,822 (660,392) (1,529,842)
Transfers to Capital Fund - - - - -
Ending Fund Balance 23,978,472$ 16,565,730$ 16,593,552$ 15,933,160$ 14,403,318$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026CASH FLOW TESTREVENUESCommodity Charges7,023,680$ 7,353,640$ 7,684,760$ 8,035,640$ 8,370,230$ Delivery Charges1,186,870 1,242,620 1,298,570 1,357,870 1,414,410 Non-Rate Charges for Services1,350 1,390 1,430 1,470 1,510 Developer Fees- - - - - Intergovernmental (CWA)- - - - - Fines and Forfeitures4,230 4,340 4,450 4,560 4,670 Income from Property & Investments(23,390) - - - - Interdepartmental20,000 20,500 21,010 21,540 22,080 Other Revenues- - - - - Other Financing Sources- - - - - TOTAL 8,212,740$ 8,622,490$ 9,010,220$ 9,421,080$ 9,812,900$ EXPENDITURESOngoing Operating ExpensesPersonnel1,840,054$ 2,138,158$ 2,228,471$ 2,325,911$ 2,422,553$ Maintenance & Equipment (w/o depreciation)5,364,915 5,449,376 5,608,415 5,772,138 5,940,835 Capital Outlay- - - - - Other Financing Uses- - - - - Other Operating ExpensesDebt Service - Recycled Water1,877,000 2,897,142 2,897,142 2,897,142 2,250,283 Rate-Funded Capital - Recycled Water2,589,677 - - - - Total Operating Expenditures11,671,646$ 10,484,676$ 10,734,028$ 10,995,191$ 10,613,671$ Policy ExpendituresReplacement Funding1,400,000$ 1,416,660$ 1,433,235$ 1,449,860$ 1,466,534$ Transfer to Capital Fund- - - - - Additions to Meet Minimum Fund Balances- - - - - Total Policy Expenditures1,400,000$ 1,416,660$ 1,433,235$ 1,449,860$ 1,466,534$ TOTAL for Cash Flow Test13,071,646$ 11,901,336$ 12,167,263$ 12,445,051$ 12,080,204$ CASH FLOW SURPLUS (DEFICIT)(4,858,906)$ (3,278,846)$ (3,157,043)$ (3,023,971)$ (2,267,304)$
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026DEBT COVERAGE TESTRecycled Operations1.25 xBond CoverageREVENUESRecycled Water Revenues8,212,740$ 8,622,490$ 9,010,220$ 9,421,080$ 9,812,900$ Recycled Water Connection Fee Revenues AllowedTotal Revenues8,212,740$ 8,622,490$ 9,010,220$ 9,421,080$ 9,812,900$ EXPENDITURESRecycled Water Expenditures7,204,969$ 7,587,534$ 7,836,886$ 8,098,049$ 8,363,388$ Debt Service - Recycled Water1,877,000 2,897,142 2,897,142 2,897,142 2,250,283 Coverage469,250 724,286 724,286 724,286 562,571 Total Expenditures9,551,219$ 11,208,961$ 11,458,314$ 11,719,477$ 11,176,241$ BOND COVERAGE SURPLUS (DEFICIT)($1,338,479) ($2,586,471) ($2,448,094) ($2,298,397) ($1,363,341)REVENUE REQUIREMENTRevenue Shortfalls(4,858,906)$ (3,278,846)$ (3,157,043)$ (3,023,971)$ (2,267,304)$ Cash Flow Driven Cash Flow Driven Cash Flow Driven Cash Flow Driven Cash Flow DrivenMonth of implementationMarchJanuary January January JanuaryCalculated Revenue Increase (%)177.54% 76.29% 70.29% 64.38% 46.34%Revenue Increase Override (INPUT in Dashboard)4.00%4.00%4.00%4.00%4.00%Implemented Rate Increase4.00%4.00%4.00%4.00%4.00%Cumulative Rate Increase -1.0%3.0%7.0%11.4%15.8%SFR Rate$23.45$24.39$25.36$26.38$27.43
FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026CASH FLOWRevenues Before Rate Increase8,212,740$ 8,622,490$ 9,010,220$ 9,421,080$ 9,812,900$ Revenues From Rate Increase328,422 343,850 359,333 375,740 391,386 LESS: Rate Increase Delay(218,948) (171,925) (179,667) (187,870) (195,693) LESS: Expenditures(13,071,646) (11,901,336) (12,167,263) (12,445,051) (12,080,204) Cash Flow(4,749,432)$ (3,106,921)$ (2,977,376)$ (2,836,101)$ (2,071,612)$ Debt Coverage per Covenant Debt Service1,877,000$ 2,897,142$ 2,897,142$ 2,897,142$ 2,250,283$ Net revenue (bond covenant definition of "net")1,117,245 1,206,882 1,353,001 1,510,902 1,645,205 Debt service coverage0.60 x0.42 x0.47 x0.52 x0.73 xTotal Available Fund - Recycled WaterBeginning Balance12,814,944$ 4,980,414$ 19,589,045$ 16,863,493$ 14,242,789$ Ending Fund Balance (includes Capital Fund)4,980,414 19,589,045 16,863,493 14,242,789 12,737,432 Fund change(7,834,530)$ 14,608,631$ (2,725,553)$ (2,620,703)$ (1,505,357)$ 252 Days 942 Days 785 Days 642 Days 556 DaysOperating FundBeginning Balance9,729,846$ 4,980,414$ 11,223,493$ 8,246,117$ 5,410,016$ Cash Flow(4,749,432) (3,106,921) (2,977,376) (2,836,101) (2,071,612) Transfers to Capital Fund- 9,350,000 - - - Ending Fund Balance4,980,414$ 11,223,493$ 8,246,117$ 5,410,016$ 3,338,404$
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix F
POTABLE COST OF SERVICE ANALYSIS
Line Allocation Basis Customer Account
Service
Meters and
Services Admin Distribution Supply
SDCWA
Variable SDCWA Fixed SDCWA IAC Desal Conservation Fire Protection
Cross
Connection
Control
Engineering General As All Others
1 Customer Account Service Determined based on detailed staff cost allocation.100%0%2 Meters and Services Applies to customer service related functions.100%0%3 Admin 100%0%
4 Distribution 100%0%
5 Supply 100%0%
6 SDCWA Variable 100%
7 SDCWA Fixed 100%0%
8 SDCWA IAC 100%0%
9 Desal 100%0%10 Conservation 100%0%11 Fire Protection 100%0%
12 Cross Connection Control 100%0%
13 Engineering 100%0%
14 General 100%0%
15 Staff Allocation Determined based on detailed staff cost allocation.0%16%7%35%5%0%0%0%0%2%0%3%10%23%0%
16 Vehicle Costs Allocation Determined based on typical CMWD vehicle use 0%30%0%44%6%0%0%0%0%0%0%5%0%14%0%
17 Uniforms Cost Allocation Determined based on uniformed staff positions 0%32%0%54%8%0%0%0%0%0%0%6%0%0%0%18 Miscellaneous Professional Services - 7490 Determined based on line item allocation 3%0%30%35%0%0%0%0%0%0%4%0%10%17%0%19 Miscellaneous Outside Services - 7550 Determined based on line item allocation 0%3%0%90%2%0%0%0%0%0%0%0%0%5%
20 As Weighed Average 100%
Notes
Operating Expenditures 2022 Customer Account
Service
Meters and
Services Admin Distribution Supply
SDCWA
Variable SDCWA Fixed SDCWA IAC Desal Conservation Fire Protection
Cross
Connection
Control
Engineering General As All Others
21 Water Operating Expenditures
22 Personnel
23 Reg Salaries 2,662,637$ Staff Allocation -$ 412,948$ 191,167$ 920,970$ 127,443$ -$ -$ -$ -$ 54,844$ -$ 92,181$ 257,914$ 605,170$ -$
24 Incentive Pay -$ Staff Allocation - - - - - - - - - - - - - - -
25 Other Personnel -$ Staff Allocation - - - - - - - - - - - - - - -
26 IOD Worker's Comp -$ Staff Allocation - - - - - - - - - - - - - - -
27 Overtime Salaries 110,000$ Staff Allocation - 17,060 7,898 38,047 5,265 - - - - 2,266 - 3,808 10,655 25,001 -
28 Standby Pay 24,000$ Staff Allocation - 3,722 1,723 8,301 1,149 - - - - 494 - 831 2,325 5,455 -
29 Parttime Salaries 18,776$ Staff Allocation - 2,912 1,348 6,494 899 - - - - 387 - 650 1,819 4,267 -
30 Intern Salaries 7,429$ Staff Allocation - 1,152 533 2,570 356 - - - - 153 - 257 720 1,688 -
31 Elected Officials' Salaries 7,000$ Staff Allocation - 1,086 503 2,421 335 - - - - 144 - 242 678 1,591 -
32 Temporary Help 40,000$ Staff Allocation - 6,204 2,872 13,835 1,915 - - - - 824 - 1,385 3,875 9,091 -
33 Health Insurance 505,472$ Staff Allocation - 78,394 36,291 174,836 24,194 - - - - 10,412 - 17,500 48,962 114,885 -
34 Life Insurance 1,860$ Staff Allocation - 288 134 643 89 - - - - 38 - 64 180 423 -
35 AD&D City Paid 931$ Staff Allocation - 144 67 322 45 - - - - 19 - 32 90 212 -
36 Vision Insurance -$ Staff Allocation - - - - - - - - - - - - - - -
37 Medicare 40,825$ Staff Allocation - 6,332 2,931 14,121 1,954 - - - - 841 - 1,413 3,954 9,279 -
38 MTG Physicals -$ Staff Allocation - - - - - - - - - - - - - - -
39 Cell Phone Allowance -$ Staff Allocation - - - - - - - - - - - - - - -
40 Auto Allowance 1,625$ Staff Allocation - 252 117 562 78 - - - - 33 - 56 157 369 -
41 Earned Leave Accrual -$ Staff Allocation - - - - - - - - - - - - - - -
42 Healthy Emp Awards -$ Staff Allocation - - - - - - - - - - - - - - -
43 Final Vacation Pay 35,000$ Staff Allocation - 5,428 2,513 12,106 1,675 - - - - 721 - 1,212 3,390 7,955 -
44 Final Sick Leave Pay -$ Staff Allocation - - - - - - - - - - - - - - -
45 Disability 24,092$ Staff Allocation - 3,736 1,730 8,333 1,153 - - - - 496 - 834 2,334 5,476 -
46 Unemployment 13,361$ Staff Allocation - 2,072 959 4,621 639 - - - - 275 - 463 1,294 3,037 -
47 Worker's Compensation 50,210$ Staff Allocation - 7,787 3,605 17,367 2,403 - - - - 1,034 - 1,738 4,864 11,412 -
48 PERS 323,511$ Staff Allocation - 50,173 23,227 111,898 15,484 - - - - 6,664 - 11,200 31,337 73,528 -
49 PERS UAL Exp -$ Staff Allocation - - - - - - - - - - - - - - -
50 PERS (GASB 68 Contra Account)-$ Staff Allocation - - - - - - - - - - - - - - -
51 PERS - Repayment -$ Staff Allocation - - - - - - - - - - - - - - -
52 OPEB Expense -$ Staff Allocation - - - - - - - - - - - - - - -
53 PERS Unfunded Liability Expense 310,869$ Staff Allocation - 48,212 22,319 107,525 14,879 - - - - 6,403 - 10,762 30,112 70,655 -
54 Social Security -$ Staff Allocation - - - - - - - - - - - - - - -
55 Deferred Comp 705$ Staff Allocation - 109 51 244 34 - - - - 15 - 24 68 160 -
56 Def Comp Match -$ Staff Allocation - - - - - - - - - - - - - - -
57 Other Personnel -$ Staff Allocation - - - - - - - - - - - - - - -
Operating Expenditures 2022 Customer Account
Service
Meters and
Services Admin Distribution Supply
SDCWA
Variable SDCWA Fixed SDCWA IAC Desal Conservation Fire Protection
Cross
Connection
Control
Engineering General As All Others
58 Maintenance & Equipment
59 Office Equip Rental 500$ Staff Allocation -$ 78$ 36$ 173$ 24$ -$ -$ -$ -$ 10$ -$ 17$ 48$ 114$ -$
60 Other Mach & Equip 2,000$ Staff Allocation - 310 144 692 96 - - - - 41 - 69 194 455 -
61 Vehicle Rentals 17,150$ Vehicle Costs Allocation - 5,179 - 7,577 1,082 - - - - - - 849 - 2,462 -
62 Misc Rentals 14,000$ General - - - - - - - - - - - - - 14,000 -
63 Misc Leases -$ General - - - - - - - - - - - - - - -
64 Office Equip Maintenance -$ Staff Allocation - - - - - - - - - - - - - - -
65 Communication Equip Maintenance 3,000$ Staff Allocation - 465 215 1,038 144 - - - - 62 - 104 291 682 -
66 Software Maintenance 50,000$ Admin - - 50,000 - - - - - - - - - - - -
67 Computer Maintenance -$ General - - - - - - - - - - - - - - -
68 Vehicle Maint 30,000$ Vehicle Costs Allocation - 9,059 - 13,255 1,894 - - - - - - 1,485 - 4,307 -
69 Wash and Wax 23,450$ Vehicle Costs Allocation - 7,081 - 10,361 1,480 - - - - - - 1,161 - 3,367 -
70 Other Equip Maintenance 100$ General - - - - - - - - - - - - - 100 -
71 Car Wash Repairs -$ Staff Allocation - - - - - - - - - - - - - - -
72 Pipeline Maintenance 234,500$ Distribution - - - 234,500 - - - - - - - - - - -
73 Fire Hydrant Maintenance - City 21,000$ Fire Protection - - - - - - - - - - 21,000 - - - -
74 FIRE HYDRANT MAINTENANCE - OTHER 25,000$ Fire Protection - - - - - - - - - - 25,000 - - - -
75 Routine Building Maintenance 5,000$ General - - - - - - - - - - - - - 5,000 -
76 Asphalt Repairs 50,000$ General - - - - - - - - - - - - - 50,000 -
77 Street Sweeping -$ General - - - - - - - - - - - - - - -
78 Maintenance, Repair and Rehab 10,000$ General - - - - - - - - - - - - - 10,000 -
79 Audit -$ General - - - - - - - - - - - - - - -
80 Legal 70,000$ Admin - - 70,000 - - - - - - - - - - - -
81 Administrative 45,000$ Admin - - 45,000 - - - - - - - - - - - -
82 Claims Admin -$ General - - - - - - - - - - - - - - -
83 Misc Professional Services 521,500$ Miscellaneous Professional Services - 7490 13,173 1,907 154,494 184,280 588 - - - - 253 21,955 426 53,882 90,542 -
84 Encina Services -$ General - - - - - - - - - - - - - - -
85 City Generated -$ General - - - - - - - - - - - - - - -
86 Citizen Generated -$ General - - - - - - - - - - - - - - -
87 Miscellaneous Outside Services 500,100$ Miscellaneous Outside Services - 7550 1,100 15,000 - 449,000 10,000 - - - - - - - - 25,000 -
88 Bank Services 38,600$ Admin - - 38,600 - - - - - - - - - - - -
89 Book Binding -$ Admin - - - - - - - - - - - - - - -
90 Comm Arts Support -$ Admin - - - - - - - - - - - - - - -
91 Regulatory/Permitting Fees 143,400$ Admin - - 143,400 - - - - - - - - - - - -
92 Misc Services -$ General - - - - - - - - - - - - - - -
93 Customer Service Charge 807,150$ SDCWA Fixed - - - - - - 807,150 - - - - - - - -
94 Emergency Storage Charge 2,047,662$ SDCWA Fixed - - - - - - 2,047,662 - - - - - - - -
95 Infrastructure Access Charge 1,857,888$ SDCWA IAC - - - - - - - 1,857,888 - - - - - - -
96 Supply Reliability Charge 1,350,210$ SDCWA Fixed - - - - - - 1,350,210 - - - - - - - -
97 MWD Capacity Reservation Charge 287,640$ SDCWA Fixed - - - - - - 287,640 - - - - - - - -
98 MWD Readiness to Service Charge 397,800$ SDCWA Fixed - - - - - - 397,800 - - - - - - - -
99 Laundry and Uniform Maintenance 8,000$ Uniforms Cost Allocation - 2,570 - 4,327 618 - - - - - - 485 - - -
100 Electrical/Scada Services 85,000$ Distribution - - - 85,000 - - - - - - - - - - -
101 Water Sampling Services 147,500$ Supply - - - - 147,500 - - - - - - - - - -
102 Water Conservation Services 22,500$ Conservation - - - - - - - - - 22,500 - - - - -
103 Landscaping Services 93,000$ General - - - - - - - - - - - - - 93,000 -
104 Ads and Publishing 500$ Admin - - 500 - - - - - - - - - - - -
105 Dues and Subscriptions 42,500$ Staff Allocation - 6,591 3,051 14,700 2,034 - - - - 875 - 1,471 4,117 9,659 -
106 Books and Publications 1,200$ Staff Allocation - 186 86 415 57 - - - - 25 - 42 116 273 -
107 Audio-Visual Materials -$ General - - - - - - - - - - - - - - -
108 Printing 15,000$ Customer Account Service 15,000 - - - - - - - - - - - - - -
109 Postage 7,000$ Customer Account Service 7,000 - - - - - - - - - - - - - -
110 Office Supplies 11,000$ Staff Allocation - 1,706 790 3,805 526 - - - - 227 - 381 1,066 2,500 -
111 Office Furniture & Equipment 15,000$ Staff Allocation - 2,326 1,077 5,188 718 - - - - 309 - 519 1,453 3,409 -
112 Computer Software 10,000$ Admin - - 10,000 - - - - - - - - - - - -
113 Misc. Computer Hardware 5,000$ Admin - - 5,000 - - - - - - - - - - - -
114 Promo Materials 6,000$ Admin - - 6,000 - - - - - - - - - - - -
115 Preschool -$ General - - - - - - - - - - - - - - -
116 Food Expense -$ General - - - - - - - - - - - - - - -
117 Heat and Light 126,270$ Distribution - - - 126,270 - - - - - - - - - - -
118 Telephone & Communications 13,600$ Staff Allocation - 2,109 976 4,704 651 - - - - 280 - 471 1,317 3,091 -
119 Waste Disposal Services 12,000$ Staff Allocation - 1,861 862 4,151 574 - - - - 247 - 415 1,162 2,727 -
120 Water 17,000$ Staff Allocation - 2,637 1,221 5,880 814 - - - - 350 - 589 1,647 3,864 -
121 Building Maintenance -$ General - - - - - - - - - - - - - - -
122 Electrical Supplies -$ General - - - - - - - - - - - - - - -
123 Janitorial Supplies -$ General - - - - - - - - - - - - - - -
124 Sign Materials -$ General - - - - - - - - - - - - - - -
125 Parts-Vehicles -$ General - - - - - - - - - - - - - - -
126 Parts-Equip 223,000$ Distribution - - - 223,000 - - - - - - - - - - -
127 Rock and Mineral Products 15,000$ Distribution - - - 15,000 - - - - - - - - - - -
128 Asphalt 5,000$ Distribution - - - 5,000 - - - - - - - - - - -
129 Small Tools 5,000$ Distribution - - - 5,000 - - - - - - - - - - -
130 Safety Equipment 25,000$ Staff Allocation - 3,877 1,795 8,647 1,197 - - - - 515 - 866 2,422 5,682 -
131 Uniforms and Accessories 4,000$ Uniforms Cost Allocation - 1,285 - 2,164 309 - - - - - - 242 - - -
132 Meters/Fittings - New Development 106,000$ Meters and Services - 106,000 - - - - - - - - - - - - -
133 Meters/Fittings - Replacement 136,000$ Meters and Services - 136,000 - - - - - - - - - - - - -
134 Fire Hose and Appliances -$ General - - - - - - - - - - - - - - -
135 Rescue Equipment -$ General - - - - - - - - - - - - - - -
136 Personal Protective Equipment -$ General - - - - - - - - - - - - - - -
137 Breathing Apparatus Equipment -$ General - - - - - - - - - - - - - - -
Operating Expenditures 2022 Customer Account
Service
Meters and
Services Admin Distribution Supply
SDCWA
Variable SDCWA Fixed SDCWA IAC Desal Conservation Fire Protection
Cross
Connection
Control
Engineering General As All Others
138 Automated Meter Program -$ General - - - - - - - - - - - - - - -
139 Gasoline and Oil 2,000$ Distribution - - - 2,000 - - - - - - - - - - -
140 Propane 500$ Distribution - - - 500 - - - - - - - - - - -
141 Other Petrol Products -$ General - - - - - - - - - - - - - - -
142 Chemicals 33,000$ Supply - - - - 33,000 - - - - - - - - - -
143 CMWD Purc Water-Outside Agency 17,516,149$ SDCWA Variable - - - - - 17,516,149 - - - - - - - - -
144 Desal Costs 7,090,728$ Desal - - - - - - - - 7,090,728 - - - - - -
145 Misc Supplies 45,000$ General - - - - - - - - - - - - - 45,000 -
146 Employee Training 6,000$ Staff Allocation - 931 431 2,075 287 - - - - 124 - 208 581 1,364 -
147 Tuition Reimbursement -$ General - - - - - - - - - - - - - - -
148 Training/Training Related Travel 4,500$ Staff Allocation - 698 323 1,556 215 - - - - 93 - 156 436 1,023 -
149 Depreciation Included in Capital Allocation
150 Prop Taxes PD 5,000$ General - - - - - - - - - - - - - 5,000 -
151 Conference Travel 1,500$ Staff Allocation - 233 108 519 72 - - - - 31 - 52 145 341 -
152 Misc. Meals/Miles 7,000$ Staff Allocation - 1,086 503 2,421 335 - - - - 144 - 242 678 1,591 -
153 Bad Debt Exp - Other Inv/Bills 47,850$ Admin - - 47,850 - - - - - - - - - - - -
154 Disposal of Assets -$ General - - - - - - - - - - - - - - -
155 Reg Over/Short -$ General - - - - - - - - - - - - - - -
156 Settlements -$ General - - - - - - - - - - - - - - -
157 Interest on Deposit -$ General - - - - - - - - - - - - - - -
158 Interfund Services -$ General - - - - - - - - - - - - - - -
159 Misc Expenditures -$ General - - - - - - - - - - - - - - -
160 Contingencies -$ General - - - - - - - - - - - - - - -
161 Vehicle Direct Charges 34,003$ Vehicle Costs Allocation - 10,268 - 15,024 2,146 - - - - - - 1,683 - 4,882 -
162 Vehicle Maintenance 160,512$ Vehicle Costs Allocation - 48,471 - 70,919 10,131 - - - - - - 7,946 - 23,044 -
163 Vehicle Replacement 178,609$ Vehicle Costs Allocation - 53,936 - 78,915 11,274 - - - - - - 8,842 - 25,642 -
164 Street Lighting -$ General - - - - - - - - - - - - - - -
165 Median Maintenance -$ General - - - - - - - - - - - - - - -
166 General Lab 158,530$ Supply - - - - 158,530 - - - - - - - - - -
167 Copy Services -$ General - - - - - - - - - - - - - - -
168 Records Management Interdept -$ General - - - - - - - - - - - - - - -
169 Information Technologies 632,427$ Meters and Services - 632,427 - - - - - - - - - - - - -
170 Misc Interdepartmental Charges 1,805,116$ Admin - - 1,805,116 - - - - - - - - - - - -
171 Mis Chg Back -$ General - - - - - - - - - - - - - - -
172 Utility Billing Chargeback -$ General - - - - - - - - - - - - - - -
173 Fiscal Agent Fees -$ General - - - - - - - - - - - - - - -
174 Arbitrage Costs -$ General - - - - - - - - - - - - - - -
175 Misc Debt Expense -$ General - - - - - - - - - - - - - - -
176 Principal -$ General - - - - - - - - - - - - - - -
177 Interest Expense -$ General - - - - - - - - - - - - - - -
178 Int Exp-Capitalized Interest -$ General - - - - - - - - - - - - - - -
179 Amortization Expense -$ General - - - - - - - - - - - - - - -
180 Issuance Costs -$ General - - - - - - - - - - - - - - -
181 Other -$ General - - - - - - - - - - - - - - -
182 Additional Maintenance & Equipment (1,705,116)$ As Weighed Average - - - - - - - - - - - - - - (1,705,116)
183 Capital Outlay
184 Non-Budgeted Cap Equip <$10K -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
185 Capital Outlay <$10K New -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
186 Capital Outlay < $10K - Repl -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
187 Cap Outlay - Vehicles -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
188 Computer Equip > $10K - Repl -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
189 Office Equipment -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
190 Other Equipment -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
191 Office Furniture -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
192 Reclass Capital Outlay -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
193 Capitalized Assets -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
194 Other Capital Outlay -$ Supply -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
195 Other Financing Uses
196 Other Other Financing Uses -$ As Weighed Average -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
197 Operating Expenditures Sub Total 39,911,331$ 36,273$ 1,702,289$ 2,687,563$ 3,033,274$ 586,286$ 17,516,149$ 4,890,462$ 1,857,888$ 7,090,728$ 112,149$ 67,955$ 173,375$ 474,283$ 1,387,773$ (1,705,116)$
198 Reallocation of "As All Others"(1,486) (69,746) (110,115) (124,280) (24,021) (717,675) (200,373) (76,122) (290,522) (4,595) (2,784) (7,104) (19,432) (56,860) 1,705,116
199 Total Allocation 39,911,331$ 34,787$ 1,632,543$ 2,577,448$ 2,908,994$ 562,264$ 16,798,475$ 4,690,089$ 1,781,766$ 6,800,206$ 107,554$ 65,170$ 166,272$ 454,850$ 1,330,913$ -$
200 Resulting Allocation 100%0.1% 4.1% 6.5%7.3%1.4% 42.1% 11.8% 4.5% 17.0%0.3%0.2%0.4%1.1%3.3% 0.0%
Cost Allocation Basis FYE 2022
Line Allocation Basis Customer Service Base Max Day Max Hour Private Fire SDCWA Desal As All Others
1 Customer Only Applies to customer service related functions.96.2%3.8%0%
3 Service Only Applies to service related functions.98.5%1.5%0%
4 Service Only - No Fire Applies to service related functions, excludes fire.100.0%0%
5 Customer and Meter Service 50% to Customer Functions, 50% related to Meter Size 48.1%49.3%2.7%0%
10 SDCWA Only Applies to costs associated with SDCWA only.100.0%0%
11 Desal Only 0.0%0.0%0.0%100.0%0%
12 Base Applies to base water usage.100.0%0%
13 Max Day Applies to high demand water functions.100.0%0%
17 Max Day/Max Hour Split 50-50 between Max Day and Max Hour.55.8%44.2%0%
20 Plant-In-Service Based on allocated assets 0.1%51.2%4.2%23.9%19.0%1.5%0.0%0.0%0%
21 As All Others Applies total allocation to remaining line items.100%
22 Operating Expenditures 2022 Allocation Customer Service Base Max Day Max Hour Private Fire SDCWA Desal As All Others
23 Functionalized Operating Expenditures
24 Customer Account Service 34,787$ Customer Only 33,453$ -$ -$ -$ -$ 1,334$ -$ -$ -$
25 Meters and Services 1,632,543$ Customer and Meter Service 784,972 804,139 - - - 43,433 - - -
26 Admin 2,577,448$ Customer Only 2,478,616 - - - - 98,832 - - -
27 Distribution 2,908,994$ Max Day/Max Hour - - - 1,623,491 1,285,503 - - - -
28 Supply 562,264$ Base - - 562,264 - - - - - -
29 SDCWA Variable 16,798,475$ SDCWA Only - - - - - - 16,798,475 - -
30 SDCWA Fixed 4,690,089$ Service Only - No Fire - 4,690,089 - - - - - - -
31 SDCWA IAC 1,781,766$ Service Only - No Fire - 1,781,766 - - - - - - -
32 Desal 6,800,206$ Desal Only - - - - - - - 6,800,206 -
33 Conservation 107,554$ Max Day - - - 107,554 - - - - -
34 Fire Protection 65,170$ Service Only - 64,202 - - - 969 - - -
35 Cross Connection Control 166,272$ Service Only - 163,800 - - - 2,471 - - -
36 Engineering 454,850$ Plant-In-Service 640 233,085 19,307 108,861 86,198 6,761 - - -
37 General 1,330,913$ As All Others - - - - - - - - 1,330,913
38 Operating Expenditures Sub Total 39,911,331$ 3,297,680$ 7,737,081$ 581,571$ 1,839,907$ 1,371,700$ 153,799$ 16,798,475$ 6,800,206$ 1,330,913$
39 Reallocation of "As All Others"113,760 266,907 20,063 63,471 47,320 5,306 579,499 234,587 (1,330,913)
40 Total Allocation 39,911,331$ 3,411,441$ 8,003,987$ 601,633$ 1,903,378$ 1,419,020$ 159,104$ 17,377,974$ 7,034,793$ -$
41 Resulting Allocation 100%8.5%20.1%1.5%4.8%3.6%0.4%43.5%17.6%0.0%
Fixed Charge Commodity Charge
Notes
42 Rate Revenue Requirement 2022 Allocation Customer Service Base Max Day Max Hour Private Fire SDCWA Desal As All Others
43 Operating Expenses 39,911,331$ Resulting O&M Allocation 3,411,441$ 8,003,987$ 601,633$ 1,903,378$ 1,419,020$ 159,104$ 17,377,974$ 7,034,793$ -$
44 Debt - Service Only - - - - - - - - -
45 Rate Funded Capital - Service Only - - - - - - - - -
46 Replacement Funding (Depreciation Funding)4,500,000 Plant-In-Service 6,331 2,305,991 191,008 1,077,000 852,784 66,887 - - -
47 Transfer to Capital Fund 4,000,000 Plant-In-Service 5,627 2,049,769 169,785 957,334 758,030 59,455 - - -
48 Cash Flows (2,424,805) As All Others -$ -$ -$ -$ -$ -$ -$ -$ (2,424,805)$
49 Less Offsetting Revenues
50 Adj. for Mid Year Increase 544,413 As All Others -$ -$ -$ -$ -$ -$ -$ -$ 544,413$
51 Non-Rate Charges for Services (323,680) As All Others -$ -$ -$ -$ -$ -$ -$ -$ (323,680)$
52 Developer Fees - As All Others - - - - - - - - -
53 Tax Revenues (3,680,500) As All Others - - - - - - - - (3,680,500)
54 Licenses and Permits - As All Others - - - - - - - - -
55 Intergovernmental (7,400) As All Others - - - - - - - - (7,400)
56 Fines & Forfeitures (104,650) As All Others - - - - - - - - (104,650)
57 Income from Prop & Investments (637,130) As All Others - - - - - - - - (637,130)
58 Interdepartmental (45,000) As All Others - - - - - - - - (45,000)
59 Other Revenues (85,000) As All Others - - - - - - - - (85,000)
60 Other Financing Sources - As All Others - - - - - - - - -
61 Total Rate Revenues to be Collected 41,647,579$ 3,423,399$ 12,359,747$ 962,426$ 3,937,712$ 3,029,834$ 285,446$ 17,377,974$ 7,034,793$ (6,763,752)$
62 Reallocation of "As All Others"(478,298) (1,726,833) (134,465) (550,154) (423,311) (39,881) (2,427,950) (982,861) 6,763,752
63 Total Allocation 41,647,579$ 2,945,102$ 10,632,915$ 827,961$ 3,387,558$ 2,606,523$ 245,565$ 14,950,023$ 6,051,933$ -$
64 Resulting Allocation 100%7%26%2%8%6%1%36%15%0%
65 Unit Cost Calculations Customer Service Base Max Day Max Hour Private Fire SDCWA Desal
66 Allocation Basis # Accounts # MEUs Usage (ccf)Peak Usage Peak Usage Usage Usage Usage
67 Total Units 349,201 1,161,220 7,672,372 3,087,135 3,087,135 - -
68 Amount Allocable to Constituent 2,945,102$ 10,632,915$ 827,961$ 3,387,558$ 2,606,523$ 245,565$ 14,950,023$ 6,051,933$
69 Unit Costs 8.43$ 9.16$ 0.11$ 1.10$ 0.84$ -$ -$ -$
70 Plant In Service Replacement Cost % Total Customer Service Base Max Day Max Hour Fire Protection SDCWA Desal As All Others
71 Land 10,447,332$ 2.7%100%0%
72 Buildings 10,764,503$ 2.7%100%0%
73 Water Service & Meters 1,105,608$ 0.3%50%50%0%
74 Machinery & Equipment 229,190$ 0.1%100%0%
75 Fire Hydrants 17,889$ 0.0%100%0%
76 Reservoirs 96,735,194$ 24.6%34%17%18%14%16%0%
77 Pipes & Pumping 273,633,042$ 69.6%35%0%28%22%15%0%
78 Construction in Progress - 100%
79 Plant-In-Service Sub Total 392,932,758 552,804$ 150,492,437$ 16,678,482$ 94,041,937$ 74,463,699$ 56,703,399$ -$ -$ -$
80 Reallocation of "As All Others"- - - - - - - - -
81 Total Allocation 392,932,758$ 552,804$ 150,492,437$ 16,678,482$ 94,041,937$ 74,463,699$ 56,703,399$ -$ -$ -$
82 Resulting Allocation 100%0.1%38.3%4.2%23.9%19.0%14.4%0%0%0%
2022
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix G
RECYCLED COST OF SERVICE ANALYSIS
Cost Allocation Basis FYE 2022
Line Allocations Customer Account Service Meters and
Services Admin Distribution Supply
Cross Connection
Control Engineering General As All Others
1 Customer Account Service 100%0%
2 Meters and Services 100%0%3 Admin 100%0%
4 Distribution 100%0%
5 Supply 100%0%
9 Cross Connection Control Applies total allocation to remaining line items.100%0%
10 Engineering 100%0%
11 General 100%0%12 Staff Allocation 0%5%4%18%2%31%26%14%0%
13 Vehicle Costs Allocation 0%11%0%26%3%53%0%7%
14 Uniforms Cost Allocation 0%14%0%32%5%50%0%0%
15 As All Other 100%
16 Plant In Service See Plant in Service section below.0%0%0%78%22%0%0%0%0%
17
Plant In Service Original Cost Customer Account Service Meters and
Services Admin Distribution Supply
Cross Connection
Control Engineering General As All Others
18 Recycled Mains 43,766,075$ 100%0%19 Recycled Water Stations 8,198,346 100%0%
20 Recycled Water Facility 14,951,103 100%0%
21 Construction in Progress - 100%
22 Plant-In-Service Sub Total 66,915,523$ -$ -$ -$ 51,964,420$ 14,951,103$ -$ -$
23 Reallocation of "As All Others"- - - - - - -
24 Total Allocation 66,915,523$ -$ -$ -$ 51,964,420$ 14,951,103$ -$ -$
25 Resulting Allocations 100%0%0%0%78%22%0%0%
26
Operating Expenditures FYE 2022 Customer Account Service Meters and
Services Admin Distribution Supply
Cross Connection
Control Engineering General As All Others
27 Recycled Water Operating Expenditures
28 Personnel
29 Reg Salaries 1,217,881$ Staff Allocation -$ 60,326$ 42,859$ 224,254$ 29,397$ 376,799$ 316,085$ 168,161$ -$
30 Incentive Pay - Staff Allocation - - - - - - - - -
31 Other Personnel - Staff Allocation - - - - - - - - -
32 IOD Worker's Comp - Staff Allocation - - - - - - - - -
33 Overtime Salaries 30,000 Staff Allocation - 1,486 1,056 5,524 724 9,282 7,786 4,142 -
34 Standby Pay 4,000 Staff Allocation - 198 141 737 97 1,238 1,038 552 -
35 Parttimes Salaries 9,388 Staff Allocation - 465 330 1,729 227 2,905 2,437 1,296 - 36 Intern Salaries 3,716 Staff Allocation - 184 131 684 90 1,150 964 513 -
37 Elected Officials' Salaries - Staff Allocation - - - - - - - - -
38 Mgt Physicals - Staff Allocation - - - - - - - - -
39 Temproary Help - Staff Allocation - - - - - - - - -
40 Health Insurance 211,460 Staff Allocation - 10,474 7,442 38,937 5,104 65,423 54,882 29,198 -
41 Life Insurance 882 Staff Allocation - 44 31 162 21 273 229 122 - 42 AD&D - City Paid 441 Staff Allocation - 22 16 81 11 136 114 61 -
43 Vision Insurance - Staff Allocation - - - - - - - - -
44 Medicare 18,290 Staff Allocation - 906 644 3,368 441 5,659 4,747 2,525 -
45 Cell Phone Allowance - Staff Allocation - - - - - - - - -
46 Auto Allowance 488 Staff Allocation - 24 17 90 12 151 127 67 -
47 Earned Leave Accrual - Staff Allocation - - - - - - - - - 48 Healthy Emp Awards - Staff Allocation - - - - - - - - -
49 Final Vacation Pay 14,000 Staff Allocation - 693 493 2,578 338 4,331 3,634 1,933 -
50 Final Sick Leave Pay - Staff Allocation - - - - - - - - -
51 Disability 11,021 Staff Allocation - 546 388 2,029 266 3,410 2,860 1,522 -
52 Unemployment 6,114 Staff Allocation - 303 215 1,126 148 1,892 1,587 844 -
53 Worker's Compensation 21,890 Staff Allocation - 1,084 770 4,031 528 6,773 5,681 3,023 -
54 PERS 147,973 Staff Allocation - 7,330 5,207 27,247 3,572 45,781 38,405 20,432 -
55 PERS - Repayment - Staff Allocation - - - - - - - - -
56 OPEB Expense - Staff Allocation - - - - - - - - -
57 PERS Unfunded Liability Exp 142,158 Staff Allocation - 7,042 5,003 26,176 3,431 43,982 36,895 19,629 -
58 Social Security - Staff Allocation - - - - - - - - -
59 Deffered Comp 353 Staff Allocation - 17 12 65 9 109 92 49 -
60 Def Comp Match - Staff Allocation - - - - - - - - - 61 Other Personnel - Staff Allocation - - - - - - - - -
Applies to variable functions.
Notes
Applies to customer and service related functions
Applies to customer and source related functions
Applies to only source functions.
Applies to only customer functions.
26
Operating Expenditures FYE 2022 Customer Account Service Meters and
Services Admin Distribution Supply
Cross Connection
Control Engineering General As All Others
62 Maintenance & Equipment
63 Office Equp Rental -$ Staff Allocation -$ -$ -$ -$ -$ -$ -$ -$ -$
64 Other Mach & Equip - Staff Allocation - - - - - - - - -
65 Misc Rentals 500 General - - - - - - - 500 -
66 Misc Leases - General - - - - - - - - -
67 Office Equip Maintenance - Staff Allocation - - - - - - - - -
68 Communication Equip Maintenance - Staff Allocation - - - - - - - - -
69 Software Maintenance 1,700 Admin - - 1,700 - - - - - -
70 Computer Maintenance - Admin - - - - - - - - -
71 Vehicle Maint - Vehicle Costs Allocation - - - - - - - - - 72 Wash and Wax 1,500 Vehicle Costs Allocation - 160 - 385 45 800 - 110 -
73 Other Equip Maintenance 500 General - - - - - - - 500 -
74 Car Wash Repairs - General - - - - - - - - -
75 Pipeline Maintenance 55,000 Distribution - - - 55,000 - - - - -
76 FIRE HYDRANT MAINT - CITY 5,000 Distribution - - - 5,000 - - - - -
77 Routine Building Mainteance 1,000 Distribution - - - 1,000 - - - - - 78 Asphalt Repairs 1,000 Distribution - - - 1,000 - - - - -
79 Maintenance, Repair and Rehab 3,243 Distribution - - - 3,243 - - - - -
80 Audit - Admin - - - - - - - - -
81 Legal - Admin - - - - - - - - -
82 Administrative - Admin - - - - - - - - -
83 Claims Admin - Admin - - - - - - - - - 84 Misc Professional Services 188,480 Distribution - - - 188,480 - - - - -
85 Encina Services 1,575,000 Supply - - - - 1,575,000 - - - -
85 Encina Services (Pension Payoff)- Supply - - - - - - - - -
86 City Generated - General - - - - - - - - -
87 Citizen Generated - General - - - - - - - - -
88 Miscellaneous Outside Services 191,000 Distribution - - - 191,000 - - - - -
89 Bank Services 1,200 Admin - - 1,200 - - - - - -
90 Book Binding - Admin - - - - - - - - -
91 Regulatory/Permitting Fees 30,000 General - - - - - - - 30,000 -
92 Misc Services - General - - - - - - - - -
93 MWD/CWA Fixed Charges - General - - - - - - - - -
94 Laundry and Uniform Mainteance 3,000 Uniforms Cost Allocation - 420 - 945 135 1,500 - - -
95 Electrical/SCADA services 35,000 Distribution - - - 35,000 - - - - - 96 Landscaping Services 22,000 General - - - - - - - 22,000 -
97 Ads and Publishing - Admin - - - - - - - - -
98 Dues and Subscriptions 8,300 Staff Allocation - 411 292 1,528 200 2,568 2,154 1,146 -
99 Books and Publications 500 Staff Allocation - 25 18 92 12 155 130 69 -
100 Audio-Visual Materials - General - - - - - - - - -
100 Printing 4,000 Customer Account Service 4,000 - - - - - - - - 101 Postage 1,000 Customer Account Service 1,000 - - - - - - - -
102 Office Supplies 1,000 Staff Allocation - 50 35 184 24 309 260 138 -
103 Office Furniture & Equipment 2,500 Staff Allocation - 124 88 460 60 773 649 345 -
104 Computer Software 5,000 Admin - - 5,000 - - - - - -
105 Misc. Computer Hardware 2,000 Admin - - 2,000 - - - - - -
106 Promo Materials 1,000 Admin - - 1,000 - - - - - - 107 Preschool - Admin - - - - - - - - -
108 Heat and Light 329,400 Distribution - - - 329,400 - - - - -
109 Telephone & Communications 900 Staff Allocation - 45 32 166 22 278 234 124 -
110 Waste Dispoal Services - Staff Allocation - - - - - - - - -
111 Water 4,500 Staff Allocation - 223 158 829 109 1,392 1,168 621 -
112 Building Maintenance - General - - - - - - - - -
113 Electrical Supplies 500 Distribution - - - 500 - - - - -
114 Janitorial Supplies - General - - - - - - - - -
115 Parts-Equip 67,500 Distribution - - - 67,500 - - - - -
116 Rock and Mineral Products 1,000 Distribution - - - 1,000 - - - - -
117 Asphalt 1,000 Distribution - - - 1,000 - - - - -
118 Small Tools 600 Distribution - - - 600 - - - - -
119 Safety Equipment 16,900 Staff Allocation - 837 595 3,112 408 5,229 4,386 2,333 - 120 Uniforms and Accessories 3,000 Uniforms Cost Allocation - 420 - 945 135 1,500 - - -
121 Meters/Fittings - New 23,700 Meters and Services - 23,700 - - - - - - -
122 Meters/Fittings - Replacement 20,000 Meters and Services - 20,000 - - - - - - -
122 Fire Hose and Appliances - General - - - - - - - - -
123 Rescue Equipment - General - - - - - - - - -
124 Personal Protective Equipment - General - - - - - - - - - 125 Breathing Apparatus Equipment - General - - - - - - - - -
126 Shooting Range Supplies - General - - - - - - - - -
127 Gasoline and Oil - General - - - - - - - - -
128 CMWD Purc Water-Outside Agency 2,268,646 Supply - - - - 2,268,646 - - - -
26
Operating Expenditures FYE 2022 Customer Account Service Meters and
Services Admin Distribution Supply
Cross Connection
Control Engineering General As All Others
129 CMWD Purch Water-From City 18,000 Supply - - - - 18,000 - - - -
130 Misc Supplies 7,000 General - - - - - - - 7,000 -
131 Employee Training 750 Staff Allocation - 37 26 138 18 232 195 104 -
132 Tuition Reimbursement - Staff Allocation - - - - - - - - -
133 Training/Training Related Travel 6,000 Staff Allocation - 297 211 1,105 145 1,856 1,557 828 -
134 Prop Taxes PD -$ General - - - - - - - - -
135 Conference/Meeting Travel 500 Staff Allocation - 25 18 92 12 155 130 69 -
136 Misc. Meals/Miles 4,500 Staff Allocation - 223 158 829 109 1,392 1,168 621 -
137 Bad Debt Exp - Other Inv/Bills 2,900 Admin - - 2,900 - - - - - -
138 Reg Over/Short - General - - - - - - - - -
139 Settlements - General - - - - - - - - - 140 Prior Period Adjustment - General - - - - - - - - -
141 Repayments - General - - - - - - - - -
142 Interest on Deposit - General - - - - - - - - -
143 Misc Expenditures - General - - - - - - - - -
144 Contingencies - General - - - - - - - - -
145 Vehicle Direct Charges - Vehicle Costs Allocation - - - - - - - - - 145 Vehicle Mainteance 20,940 Vehicle Costs Allocation - 2,234 - 5,375 628 11,168 - 1,536 -
146 Vehicle Replacement 25,931 Vehicle Costs Allocation - 2,766 - 6,656 778 13,830 - 1,902 -
147 Street Lighting - General - - - - - - - - -
148 Median Maintenace - General - - - - - - - - -
149 General Liab 61,130 Admin - - 61,130 - - - - - -
150 Records Management Interdept - General - - - - - - - - - 151 Information Technologies 152,514 Meters and Services - 152,514 - - - - - - -
152 Misc Interdepartmental Charges 577,147 Admin - - 577,147 - - - - - -
153 Mis Chg Back - General - - - - - - - - -
154 Utility Billing Chargeback - General - - - - - - - - -
155 Other - General - - - - - - - - -
156 Additional Maintenance & Equipment (390,465) As All Other - - - - - - - - (390,465)
157 Capital Outlay
158 Non-Budgeted Cap Equip <$10K -$ Distribution -$ -$ -$ -$ -$ -$ -$ -$ -$ 159 Capital Outlay <$10K New - Distribution - - - - - - - - -
160 Cap Outlay - Vehicles - Distribution - - - - - - - - -
161 Computer Equip > $10K - Repl - Distribution - - - - - - - - -
162 Office Equipment - Distribution - - - - - - - - -
163 Other Equipment - Distribution - - - - - - - - -
164 Capitalized Assets - Distribution - - - - - - - - - 165 Capital Projects - Distribution - - - - - - - - -
166 Other Capital Outlay - Distribution - - - - - - - - -
167 Other Financing Uses
168 Other Other Financing Uses - Distribution -$ -$ -$ -$ -$ -$ -$ -$ -$
169 Operating Expenditures Sub Total 7,204,969$ 5,000$ 295,654$ 718,463$ 1,241,380$ 3,908,900$ 612,431$ 489,591$ 324,016$ (390,465)$
170 Reallocation of "As All Others"(257.04) (15,198.94) (36,934.66) (63,816.76) (200,948.34) (31,483.78) (25,168.86) (16,656.97) 390,465.34
171 Total Allocation 7,204,969$ 4,743$ 280,455$ 681,528$ 1,177,564$ 3,707,952$ 580,947$ 464,423$ 307,359$ -$
172 Percentage Allocation 100%0.07%3.89%9.46%16.34%51.46%8.06%6.45%4.27%0.00%
Cost Allocation Basis FYE 2022
Line Allocations Customer Service Base Supply As All Others
1 Customer Only 100.0%0%
2 Customer and Meter Service 25.0%75.0%0%
3 Service Only 100.0%
4 Base Only 100.0%0%
5 Supply Only 100.0%0%
6 As All Others Applies total allocation to remaining line items.100%
7 Plant In Service See Plant in Service section below.0%20%61%19%0%
8
Plant In Service Original Cost Customer Service Base Supply As All Others
9 Recycled Mains 65,806,156$ 20%80%0%
10 Recycled Water Stations 11,333,778 20%80%0%
11 Recycled Water Facility 24,156,590 20%80%0%
12 Construction in Progress - 100%
13 Plant-In-Service Sub Total 101,296,525$ -$ 20,259,305$ 61,711,948$ 19,325,272$ -$
14 Reallocation of "As All Others"- - - - -
15 Total Allocation 101,296,525$ -$ 20,259,305$ 61,711,948$ 19,325,272$ -$
16 Resulting Allocations 100%0%20%61%19%0%
17
Operating Expenditures 2022 Allocation Customer Service Base Supply As All Others
18 Functionalized Operating Expenditures
19 Customer Account Service 4,743$ Customer Only 4,743 - - - -
20 Meters and Services 280,455 Customer and Meter Service 70,114 210,341 - - -
21 Admin 681,528 Service Only - 681,528 - - -
22 Distribution 1,177,564 Base Only - - 1,177,564 - -
23 Supply 3,707,952 Supply Only - - - 3,707,952 -
24 Cross Connection Control 580,947 Base Only - - 580,947 - -
25 Engineering 464,423 Plant In Service - 92,885 282,936 88,602 -
26 General 307,359 As All Others - - - - 307,359
27 Operating Expenditures Sub Total 7,204,969$ 74,857$ 984,754$ 2,041,446$ 3,796,554$ 307,359$
28 Reallocation of "As All Others"3,335.63 43,880.81 90,967.24 169,175.16 (307,358.85)
29 Total Allocation 7,204,969$ 78,192$ 1,028,634$ 2,132,414$ 3,965,729$ -$
30 Percentage Allocation 100%1.09%14.28%29.60%55.04%0.00%
Fixed Charge
Notes
Applies to customer and related functions
Applies to customer and source related functions
31
Rate Revenue Requirement 2022 Allocation Customer Service Base Supply As All Others
32 Operating Expenses 7,204,969$ As O&M 78,192$ 1,028,634$ 2,132,414$ 3,965,729$ -$
33 Debt Service 1,877,000 Base Only - - 1,877,000 - -
34 Rate Funded Capital 2,589,677 Plant In Service - 517,935 1,577,685 494,057 -
35 Replacement Funding 1,400,000 Plant In Service - 280,000 852,909 267,091 -
36 Transfer to Capital Fund - Plant In Service - - - - -
37 Cash Flows (4,749,432) As All Others - - - - (4,749,432)
38 Less Offsetting Revenues
39 Offsetting Recycled Water Revenues
40 Adj. for Mid Year Increase 218,948$ As All Others -$ -$ -$ -$ 218,948$
41 Non-Rate Charges for Services (1,350) As All Others - - - - (1,350)
42 Developer Fees - As All Others - - - - -
43 Intergovernmental (CWA)- As All Others - - - - -
44 Fines and Forfeitures (4,230) As All Others - - - - (4,230)
45 Income from Property & Investments 23,390 As All Others - - - - 23,390
46 Interdepartmental (20,000) As All Others - - - - (20,000)
47 Other Revenues - As All Others - - - - -
48 Other Financing Sources - As All Others - - - - -
49 Total Rate Revenues to be Collected 8,538,972$ 78,192$ 1,826,570$ 6,440,008$ 4,726,876$ (4,532,674)$
50 Reallocation of "As All Others"(27,114) (633,374) (2,233,112) (1,639,074) 4,532,674
51 Total Allocation 8,538,972$ 51,079$ 1,193,195$ 4,206,895$ 3,087,803$ -$
52 Percentage Allocation 100%1%14%49%36%0%
53
Retail Unit Cost Calculations 2022 Customer Service Base Supply
54 Allocation Basis # Accounts # MEUs Usage (ccf)Usage (ccf)
55 Total Units 11,061 63,379 1,853,214 1,853,214
56 Amount Allocable to Constituent 51,079$ 1,193,195$ 4,206,895$ 3,087,803$
57 Per Unit Costs 4.62$ 18.83$ 2.27$ 1.67$
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix H
POTABLE WATER CUSTOMER ALLOCATION
Allocation Year FYE 2022
SFR MFR NR AR IR
Line Customer Statistics Single Family Multi-Family Commercial Agricultural Irrigation Fire Total
1 Number of Accounts 24,179 1,241 1,736 16 813 1,116 29,100
2 Number of MEUs 27,620 5,487 8,890 186 4,355 50,230 96,768
3 Annual Water Usage 3,226,108 734,848 1,185,208 74,408 669,145 5,889,716 ccf
4 Max Month 341,684 69,225 113,821 10,020 76,557 611,306 ccf
5 Max Day 28,891 3,864 5,963 525 7,252 46,495 ccf
6 Max Hour 1,694 227 350 31 425 2,727 ccf
7 SDCWA 2,669,882 653,624 973,597 58,164 445,449 4,800,716 ccf
8 Desal 556,226 81,223 211,611 16,245 223,696 1,089,000 ccf
9 Customer Single Family Multi-Family Commercial Agricultural Irrigation Total
10 86%4%6%0%3%100%
11 Allocation Basis:Number of Accounts 24,179 1,241 1,736 16 813 27,984
12 Allocated Customer Costs 2,544,593$ 130,623$ 182,669$ 1,689$ 85,527$ 2,945,102$
13 Service Single Family Multi-Family Commercial Agricultural Irrigation Total
14 59%12%19%0%9%100%
15 Allocation Basis:Number of MEUs 27,620 5,487 8,890 186 4,355 46,538
16 Allocated Customer Costs 6,310,599$ 1,253,608$ 2,031,096$ 42,522$ 995,089$ 10,632,915$
17 Base Single Family Multi-Family Commercial Agricultural Irrigation Total
18 54.78%12.48%20.12%1.26%11.36%100%
19 Allocation Basis:Annual Water Usage 3,226,108 734,848 1,185,208 74,408 669,145 5,889,716
20 Allocated Customer Costs 453,518$ 103,303$ 166,613$ 10,460$ 94,067$ 827,961$
21 Max Day Single Family Multi-Family Commercial Agricultural Irrigation Total
22 62.14%8.31%12.82%1.13%15.60%100%
23 Allocation Basis:Max Day 28,891 3,864 5,963 525 7,252 46,495
24 Allocated Customer Costs 2,104,935$ 281,561$ 434,427$ 38,243$ 528,392$ 3,387,558$
25 Max Hour Single Family Multi-Family Commercial Agricultural Irrigation Total
26 62.14%8.31%12.82%1.13%15.60%100%
27 Allocation Basis:Max Hour 1,694 227 350 31 425 2,727
28 Allocated Customer Costs 1,619,621$ 216,644$ 334,266$ 29,426$ 406,566$ 2,606,523$
29 SDCWA Single Family Multi-Family Commercial Agricultural Irrigation Total
30 55.61%13.62%20.28%1.21%9.28%
31 Allocation Basis:SDCWA 2,669,882 653,624 973,597 58,164 445,449 4,800,716
32 Allocated Customer Costs 8,314,342$ 2,035,467$ 3,031,902$ 181,129$ 1,387,184$ 14,950,023$
33 Desal Single Family Multi-Family Commercial Agricultural Irrigation Total
34 51.08%7.46%19.43%1.49%20.54%
35 Allocation Basis:Desal 556,226 81,223 211,611 16,245 223,696 1,089,000
36 3,091,129$ 451,383$ 1,175,991$ 90,277$ 1,243,152$ 6,051,933$
37 Private Fire Fire Total
38 Allocation Basis:Number of MEUs 50,230 50,230
39 Allocated Customer Costs 245,565$ 245,565$
40 Cost Allocation Summary Single Family Multi-Family Commercial Agricultural Irrigation Fire Total
41 Customer 2,544,593$ 130,623$ 182,669$ 1,689$ 85,527$ -$ 2,945,102$
42 Base 453,518 103,303 166,613 10,460 94,067 - 827,961
43 Max Day 2,104,935 281,561 434,427 38,243 528,392 - 3,387,558
44 Max Hour 1,619,621 216,644 334,266 29,426 406,566 - 2,606,523
45 SDCWA 8,314,342 2,035,467 3,031,902 181,129 1,387,184 - 14,950,023
46 Service 6,310,599 1,253,608 2,031,096 42,522 995,089 - 10,632,915
47 Desal 3,091,129 451,383 1,175,991 90,277 1,243,152 - 6,051,933
48 Private Fire - - - - - 245,565 245,565
49 Total 24,438,737$ 4,472,590$ 7,356,964$ 393,747$ 4,739,976$ 245,565$ 41,647,579$
2021 Carlsbad Potable & Recycled Water Financial Model_10082021_appendix
Customer Allocation - Appendix H Page 1 of 1
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix I
RATE DESIGN ANALYSIS
First year of rate adjustment FYE 2022
Line Customer Service Private Fire Base Max Day Max Hour SDCWA Desal Total
1 Allocated 2022 Revenue Requirement -$ 453,518$ 2,104,935$ 1,619,621$ 8,314,342$ 3,091,129$ 15,583,545$
2 Recovered through Account Charges 100%
3 Number of Accounts
4 Monthly Fixed Charge Per Account 8.77$ -$ -$ -$ -$ -$ -$ -$ 8.77$
5 Recovered through Unit Charges 100%100%
6 Effective Number of MEUs (FY 2021)
7 Monthly Fixed Charge Per MEU -$ 19.04$ -$ -$ -$ -$ -$ 19.04$
8 Recovered through Volume Charges 100%100%100%100%100%
9 Tier Usage %ccf Tier Use per Tier
Max Day Extra
Capacity
Max Hour Extra
Capacity SDCWA Desal
10 Tier 1 59%1,898,561 Tier 1 1,898,561 1,422,564 3,219,436 1,898,561 -
11 Tier 2 18%575,037 Tier 2 575,037 1,861,942 1,558,280 575,037 -
12 Tier 3 23%752,509 Tier 3 752,509 4,073,690 2,706,341 196,284 556,226
13 100%3,226,108 All Tiers 3,226,108 7,358,196 7,484,058 2,669,882 556,226
14 Tier Limits (ccf)Upper Limit
15 Tier 1 0 10 Tier 1 58.8%19.3%43.0%71.1%0.0%
16 Tier 2 11 18 Tier 2 17.8%25.3%20.8%21.5%0.0%
17 Tier 3 19 999999 Tier 3 23.3%55.4%36.2%7.4%100.0%
All Tiers 100.0% 100.0% 100.0% 100.0% 100.0%
18 Volume Charge ($/ccf)0.14$ 0.65$ 0.50$ 2.58$ 0.96$
TRUE TRUE TRUE TRUE TRUE
19 Tier Volume Charge per ccf:Rounded Rates
20 Tier 1 0.14$ 0.21$ 0.37$ 3.11$ -$ 3.84$
21 Tier 2 0.14$ 0.93$ 0.59$ 3.11$ -$ 4.77$
22 Tier 3 0.14$ 1.55$ 0.78$ 0.81$ 4.11$ 7.39$
Single Family Residential (SFR)
First year of rate adjustment FYE 2022
23 Customer Service Private Fire Base Max Day Max Hour SDCWA Desal Total
24 Allocated 2022 Revenue Requirement -$ 103,303$ 281,561$ 216,644$ 2,035,467$ 451,383$ 3,088,359$
25 Recovered through Account Charges 100%
26 Number of Accounts (FY 2021)
27 Monthly Fixed Charge Per Account 8.77$ -$ -$ -$ -$ -$ -$ -$ 8.77$
28 Recovered through Unit Charges 100%100%
29 Effective Number of MEUs (FY 2021)
30 Monthly Fixed Charge Per MEU -$ 19.04$ -$ -$ -$ -$ -$ -$ 19.04$
31 Recovered through Volume Charges 100%100%100%100%100%
32 Tier Usage %ccf Tier Peak Factor Tier Use per Tier
Max Day Extra
Capacity
Max Hour Extra
Capacity SDCWA Desal
33 Tier 1 80%589,672 1.03 Tier 1 589,672 370,512 970,857 589,672 -
34 Tier 2 20%145,176 1.22 Tier 2 145,176 314,111 329,853 63,953 81,223 TRUE
35 Tier 3 - 2.44 Tier 3
36 Total MFR Usage 100%734,848 734,848 All Tiers (ccf)734,848 684,623 1,300,710 653,624 81,223
37 Tier Limits (ccf/DU)Upper Limit Tier 1 80.2%54.1%74.6%90.2%0.0%
38 Tier 1 0 5 Tier 2 19.8%45.9%25.4%9.8%100.0%
39 Tier 2 6 10 Tier 3 0.0%0.0%0.0%0.0%0.0%
40 Tier 3 11 999999 All Tiers (ccf) 100.0% 100.0% 100.0% 100.0% 100.0%
TRUE TRUE TRUE TRUE FALSE
41 Volume Charge ($/ccf)0.14$ 0.38$ 0.29$ 2.77$ 0.61$
42 Tier Volume Charge per ccf:Rounded Rates
43 Tier 1 0.14$ 0.26$ 0.27$ 3.11$ -$ 3.79$
44 Tier 2 0.14$ 0.89$ 0.38$ 1.37$ 3.11$ 5.89$
45 Tier 3 -$
Multi-Family Residential (MFR)
First year of rate adjustment FYE 2022
46 Customer Service Private Fire Base Max Day Max Hour SDCWA Desal Total
47 Allocated 2022 Revenue Requirement -$ 166,613$ 434,427$ 334,266$ 3,031,902$ 1,175,991$ 5,143,198$
48 Recovered through Account Charges 100%
49 Number of Accounts (FY 2021)
50 Monthly Fixed Charge Per Account 8.77$ -$ -$ -$ -$ -$ -$ -$ 8.77$
51 Recovered through Unit Charges 100%100%
52 Effective Number of MEUs (FY 2021)
53 Monthly Fixed Charge Per MEU -$ 19.04$ -$ -$ -$ -$ -$ -$ 19.04$
54 Recovered through Volume Charges 100%100%100%100%100%
55 Projected Billed Water Usage (ccf)1,185,208 Rounded Rates
56 Volume Charge ($/ccf)-$ -$ -$ 0.14$ 0.37$ 0.28$ 2.56$ 0.99$ 4.34$
Commercial
First year of rate adjustment FYE 2022
57 Customer Service Private Fire Base Max Day Max Hour SDCWA Desal Total
58 Allocated 2022 Revenue Requirement -$ 10,460$ 38,243$ 29,426$ 181,129$ 90,277$ 349,535$
59 Percent Recovered Through Account Charges 100%
60 Number of Accounts
61 Monthly Fixed Charge Per Account 8.77$ -$ -$ -$ -$ -$ -$ -$ 8.77$
62 Recovered through Unit Charges 100%100%
63 Effective Number of MEUs (FY 2021)
64 Monthly Fixed Charge Per MEU -$ 19.04$ -$ -$ -$ -$ -$ -$ 19.04$
65 Recovered through Volume Charges 100%100%100%100%100%
66 Projected Billed Water Usage (ccf)74,408 Rounded Rates
67 Volume Charge ($/ccf)-$ -$ -$ 0.14$ 0.51$ 0.40$ 2.43$ 1.21$ 4.70$
Agricultural
First year of rate adjustment FYE 2022
68 Customer Service Private Fire Base Max Day Max Hour SDCWA Desal Total
69 Allocated 2022 Revenue Requirement -$ 94,067$ 528,392$ 406,566$ 1,387,184$ 1,243,152$ 3,659,360$
70 Percent Recovered Through Account Charges 100%
71 Number of Accounts
72 Monthly Fixed Charge Per Account 8.77$ -$ -$ -$ -$ -$ -$ -$ 8.77$
73 Recovered through Unit Charges 100%100%
74 Effective Number of MEUs (FY 2021)
75 Monthly Fixed Charge Per MEU -$ 19.04$ -$ -$ -$ -$ -$ -$ 19.04$
76 Recovered through Volume Charges 100%100%100%100%100%
77 Projected Billed Water Usage (ccf)669,145 Rounded Rates
78 Volume Charge ($/ccf)-$ -$ -$ 0.14$ 0.79$ 0.61$ 2.07$ 1.86$ 5.47$
Irrigation
First year of rate adjustment FYE 2022
79 Private Fire Total
80 Allocated 2022 Revenue Requirement 245,565$ 245,565$
81 Percent Recovered Through Account Charges 44%
82 Number of Accounts 1,115.83
83 Monthly Fixed Charge Per Account 8.10$ 8.10$
84 Recovered through Unit Charges 56%
85 Effective Number of MEUs (FY 2021)50,230 Rounded Rates
86 Monthly Fixed Charge Per MEU 0.23$ 0.23$
Private Fire
WATER COST OF SERVICE STUDY | 2021 POTABLE AND RECYCLED WATER RATE STUDY | CMWD
FINAL |OCTOBER 2021
Appendix J
SUPPLY ALLOCATION
Line
1 Supply Allocation SDCWA Desal Total
2 Total Available for Retail (ccf)4,800,716 1,089,000 5,889,716
3 Annualized 6-Month Minimum Use
4 Remaining Available Before Allocation 4,800,716 1,089,000 5,889,716
5 Amount to be Allocated 4,800,716 412,619 5,213,335
6 Allocated Min. 6 Month Remaining
7 Single Family 2,899,357 2,899,357 2,669,882 229,475 2,899,357
Tier 1
Tier 2
Tier 3
8 Multi-Family 709,803 709,803 653,624 56,179 709,803
Tier 1
Tier 2
9 Commercial/Non-Residential 1,057,277 1,057,277 973,597 83,680 1,057,277
10 Agricultural 63,163 63,163 58,164 4,999 63,163
11 Irrigation 483,735 483,735 445,449 38,286 483,735
12 Total (ccf)5,213,335 5,213,335 4,800,716 412,619 5,213,335
Remaining to Allocate - 676,381 676,381
Annualized Average Use
Remaining Available Before Allocation - 676,381 676,381
Amount to be Allocated - 676,381 676,381
13 Allocated Average Month
Less Previously
Allocated Remaining
14 Single Family 3,226,108 (2,899,357) 326,751 - 326,751 326,751
15 Multi-Family 734,848 (709,803) 25,044 - 25,044 25,044
16 Commercial/Non-Residential 1,185,208 (1,057,277) 127,931 - 127,931 127,931
17 Agricultural 74,408 (63,163) 11,246 - 11,246 11,246
18 Irrigation 669,145 (483,735) 185,410 - 185,410 185,410
19 Total (ccf)5,889,716 (5,213,335)676,381 - 676,381 676,381
Remaining to Allocate - 0 0
20 Total Supply Allocation SDCWA Desal Total
21 Single Family Single Family 2,669,882 556,226 3,226,108
22 Multi-Family Multi-Family 653,624 81,223 734,848
23 Commercial/Non-Residential Commercial/Non-Residential 973,597 211,611 1,185,208
24 Agricultural Agricultural 58,164 16,245 74,408
25 Irrigation Irrigation 445,449 223,696 669,145
26 Total (ccf)4,800,716 1,089,000 5,889,716
27 Check:4,800,716 1,089,000 5,889,716
28 Single Family 56%51%55%
29 Multi-Family 14%7%12%
30 Commercial/Non-Residential 20%19%20%
31 Agricultural 1.2%1.5%1.3%
32 Irrigation 9.3%20.5%11.4%
33 100%100%100%