Water & Sewer Rates Workshop
How are Wholesale Water Rates Determined? Township is a wholesale customer of Great Lakes Water Authority Relationship is governed by a model contract, same for all customers, no “negotiating” Rate methodology developed by Technical Advisory Committee(TAC) TAC determines factors and their impact which influences rates Overall, wholesale rates are determined by GLWA annually based on their revenue requirements Community revenue requirement based on volume (2-yr average) and composed on commodity and fixed rates
How are Wholesale Water Rates Determined? Intrinsic rate factors: Distance to treatment plants Elevation relative to treatment plants Variable rate factors: Annual Volume (mcf) Max Day Demand (MGD) Peak Hour Demand (MGD)
Factor 1: Distance to Treatment Plants
Factor 2: Elevation Relative to Treatment Plants Key Elevations WG-01 (30.5 Mile) – 788’ WG-02 (26 Mile) – 733’ Wash. Twp. Hall – 695’ Stratford – 875’ Macomb Twp. Hall – 615’ Shelby Twp. Hall – 675’ Clinton Twp. Hall – 600’ Water Works Park – 585’ Lake Huron – 581’
Variable Factors Affect of Variable Rates Annual Volume goes up, rates go down Max day demand goes up, rates go up Peak hour demand goes up, rates go up Goal of Tank No change to volume No change to max day demand Lower peak hour demand equal to max day demand
How Does the Tank Work? Eliminates Peak Hour Demand Tank is filled during approved GLWA period (11 PM – 5 AM) Flow is released from the system during daytime peaks 5 AM to 10 AM 6 PM to 9 PM SCADA controls all actions Tank is filled and emptied using system pressure and pumps
How Does the Tank Work? Max Day Peak Hour
How Does the Tank Work?
Results of Tank Construction Township requests non-scheduled contract opener Review of operational data from summer of 2016 Exhibit B revised to making max day equal to peak hour Wholesale revenue requirement to GLWA decreases Savings passed onto customers
Why 1st Quarter FY2017 Bills Were So High Two factors combined to impact Q1 FY2017 bills: +/-25% increase from GLWA effective July 1, 2015 Drought or near drought conditions all summer
Why 1st Quarter FY2017 Bills Were So High *Note - lowest rainfall for this quarter in 10 years
How Do Township Bills Compare Commodity Rate Comparison (residential customer) Washington Rochester Hills Shelby Twp. $3.60/cf $5.32/cf $3.954/cf $3.53/cf $5.37/cf $5.077/cf Water Sewer Fixed Charge Comparison Washington Rochester Hills Shelby Twp. $45.00/qtr. $4.35/qtr. $2.50/qtr. $49.50/qtr. $4.35/qtr. $1.65/qtr. Water Sewer
How Do Township Bills Compare Effects of Fixed Charge and Commodity Rate Washington* Rochester Hills* Shelby Twp.* $217.49 $159.93 $193.10 $302.27 $267.31 $320.21 $395.89 $385.89 $460.57 $226.90 $171.86 $207.21 $1,142.55 $984.99 $1,181.09 1st Qtr.** 2nd Qtr. 3rd Qtr. 4th Qtr. *Assumes 1 REU with average annual usage of 10,723 cf **Quarter refers to calendar year quarter, i.e. 1st Qtr = January through March
Changes to Billing Process Rate changes take effect October 1 each year Delays in changes from County/GLWA Irrigation scheduling, Township to provide suggested times Potential move to monthly bills Budget/payment plan options Irrigation/second meter options
Questions