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Home My WebLink AboutHandouts Utility rate study presentation 01-23-171/23/2017 1 WESTLAKE UTILITY RATE WORKSHOP January 23, 2017 1/23/2017 2 WESTLAKE UTILITY RATE WORKSHOP Current Water and Sewer Revenues are underperforming (revenues<expenditures) by approximately 19% and 17% respectively. Water and Sewer Fund Status 1/23/2017 3 WESTLAKE UTILITY RATE WORKSHOP Water and Sewer Rate Considerations •Current Water and Sewer Revenues are underperforming (revenues<expenditures) by approximately 19% and 17% respectively. •Phase 2 Fort Worth Waterline project $4M over a four year period ($1M/year) •Southlake sewer payment increase of $410,000 for N-1 flows •The Town’s wholesale wastewater provider, Trinity River Authority, treatment cost 1/23/2017 4 WESTLAKE UTILITY RATE WORKSHOP PROPOSED RATE IMPACT •The average residential water charges will be increased by approximately 8.5%. •The average residential sewer charges will be increased by approximately 13.8%. •The average commercial water charges will be increased by approximately 8.5%. •The average commercial sewer charges will be increased by approximately 13.9% Westlake Community Values CAPITAL INVESTMENT –Ensure the infrastructure and capital investments of the Town are maintained to sustain the community’s quality of life. FISCAL STEWARDSHIP AND ORGANIZATIONAL EFFECTIVENESS — Maintain a balanced approach to revenue forecasting and expenditure allocation to ensure the necessary resources for long - term sustainability. 1/23/2017 5 WESTLAKE UTILITY RATE WORKSHOP 1/23/2017 6 WESTLAKE UTILITY RATE WORKSHOP Council’s Financial Policy Utility rates and rate structures for water and sewer services will be constructed to target full cost of service recovery. Annually the Town will review and adopt water and sewer utility rates and a rate structure that generates revenue sufficient to fully cover operating expenses, meet the legal restrictions of all applicable bond covenants, provide for an adequate level of working capital, and recover applicable general/administrative costs. 1/23/2017 7 WESTLAKE UTILITY RATE WORKSHOP •The rate study should address both current and future system needs. •The Council should have a clear understanding of the rate study. POLICY GOALS FOR RATE STUDY 1/23/2017 8 WESTLAKE UTILITY RATE WORKSHOP •Ratemaking is the process of allocating revenue requirements to customers via the price of water •Water systems, regulators, courts, and policy analysts follow several accepted ratemaking principles (AWWA) What is Ratemaking? 1/23/2017 9 WESTLAKE UTILITY RATE WORKSHOP AWWA Policy 1. Every water utility should receive sufficient revenues from water service and user charges to enable it to finance all operating and maintenance expenses and all capital costs. 2.Water utilities should maintain their funds in separate accounts. Such funds should not be diverted to uses unrelated to water utilities… 3. Every water utility should adopt a uniform system of accounts … 4. Water rate schedules should distribute the cost of water service equitably… Source: AWWA 1/23/2017 10 WESTLAKE UTILITY RATE WORKSHOP •Revenue Requirement Projections –How much money is needed? •Cost of Service Analysis –From whom should the money be collected? •Design of recommended rates –How should services be priced? Key Issues When Evaluating Rates: 1/23/2017 11 WESTLAKE UTILITY RATE WORKSHOP •Does the rate meet revenue requirements? •Is the rate sound for planning and management purposes? •Is the process in accordance with accepted industry standards? Utility’s Perspective of Rates 1/23/2017 12 WESTLAKE UTILITY RATE WORKSHOP •Are the existing or proposed rates fair and equitable? •Are the existing or proposed rates affordable? •Are the existing or proposed rates easy to understand? •Are they competitive with neighboring communities? Customer’s Perspective of Rates 1/23/2017 13 WESTLAKE UTILITY RATE WORKSHOP 1/23/2017 14 WESTLAKE UTILITY RATE WORKSHOP 1/23/2017 15 WESTLAKE UTILITY RATE WORKSHOP $270.59 $252.82 $331.33 $331.42 $283.21 $307.50 $412.95 $240.88 $248.93 $0 $100 $200 $300 $400 $500 $600 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed AquaSource Bartonville Argyle Water Charges (45,000 gallons/month -1" meter) 2017 Utility Rate Study + $24.29 member-owned non-profit utilityInvestor Owned Utility member-owned non-profit utility 1/23/2017 16 WESTLAKE UTILITY RATE WORKSHOP $67.28 $52.67 $76.50 $134.31 $141.05 $161.05 $0 $40 $80 $120 $160 $200 Keller (20,000 gal cap)Southlake (10,000 gal cap) Roanoke Trophy Club (18,000 gal cap) Westlake - Current Westlake - Proposed Average Westlake Residential Sewer (15,000 gallons/month -1" meter) 2017 Utility Rate Study +$20.00 1/23/2017 17 WESTLAKE UTILITY RATE WORKSHOP $270.59 $252.82 $331.33 $331.42 $283.21 $307.50 $67.28 $52.67 $76.50 $134.31 $141.05 $161.05 $337.87 $305.49 $407.83 $465.73 $424.26 $468.55 $0.00 $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed Average Westlake House (45,000 gals water & 15,000 gals sewer) (20,000 gal. sewer cap) (10,000 gal. sewer cap) (12,000 gal. sewer cap) (10,000 gal. sewer cap) 1/23/2017 18 WESTLAKE UTILITY RATE WORKSHOP $1,256 $1,182 $1,654 $1,339 $1,445 $1,569 $1,732 $4,475 $1,441 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed AquaSource Bartonville Argyle Westlake Commercial Average (186,000 gallons/month -2" meter) 2017 Utility Rate Study + $124.00 1/23/2017 19 WESTLAKE UTILITY RATE WORKSHOP $641.74 $613.37 $1,373.00 $1,225.67 $1,502.10 $1,710.90 $0 $500 $1,000 $1,500 $2,000 Keller Southlake Roanoke Trophy Club Westlake - Current Westlake - Proposed Average Westlake Commercial Sewer (186,000 gallons/month -2" meter)+$157.8 2017 Utility Rate Study +$208.80 1/23/2017 20 WESTLAKE UTILITY RATE WORKSHOP 13,865 11,424 1,772 1,774 9,277 7,139 3,218 3,318 745 323 - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 Water Customers Sewer Customers Water Customers Sewer Customers Water Customers Sewer Customers Water Customers Sewer Customers Water Customers Sewer Customers Keller Roanoke Southlake Trophy Club Westlake COMPARISON OF UTILITY CUSTOMERS 1/23/2017 21 WESTLAKE UTILITY RATE WORKSHOP $70.79 $76.29 $65.76 $137.04 $121.30 $129.42 $158.78 $99.63 $101.83 $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed AquaSource Bartonville Argyle Average JT Ottinger / Mahotea Boone House (11,000 gallons/month -1" meter) + $8.12 2017 Utility Rate Study 1/23/2017 22 WESTLAKE UTILITY RATE WORKSHOP $417.38 $380.29 $504.65 $477.78 $410.26 $447.15 $572.55 $408.28 $394.96 $0 $100 $200 $300 $400 $500 $600 $700 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed AquaSource Bartonville Argyle Average Wyck Hill / Aspen Lane House (66,000 gallons/month -1" meter) 2017 Utility Rate Study + $36.89 1/23/2017 23 WESTLAKE UTILITY RATE WORKSHOP $452.33 $410.64 $546.50 $513.83 $440.51 $480.40 $67.28 $52.67 $76.50 $134.31 $141.05 $161.05 $0.00 $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed Average Glenwyck Farms House (71,000 gals water & 15,000 gals sewer) (20,000 gal. sewer cap) (10,000 gal. sewer cap) (12,000 gal. sewer cap) (10,000 gal. sewer cap) 1/23/2017 24 WESTLAKE UTILITY RATE WORKSHOP $759.89 $677.72 $914.78 $831.07 $706.71 $773.00 $67.28 $52.67 $76.50 $134.31 $141.05 $161.05 $0.00 $200.00 $400.00 $600.00 $800.00 $1,000.00 $1,200.00 Keller Southlake Roanoke Trophy Club Westlake Current Westlake Proposed Average Vaquero House (115,000 gals water & 15,000 gals sewer) (20,000 gal. sewer cap) (10,000 gal. sewer cap) (12,000 gal. sewer cap) (10,000 gal. sewer cap)