Stella Werner Office BuildingRockville, Maryland
2 Water Filtration Plants
6 Wastewater Treatment Plants
(WWTP)
3 Water Storage Dam/Reservoirs
60 Water Storage Tanks
53 WWTP Pumping Stations
42,000+ Fire Hydrants
17,000 Solar Panels
0 Water Quality Violations
WSSC At A Glance
2
Why Change?
Rate Structure Setting Milestones
Extensive Public Outreach
Commissioners’ Policy Priorities
Basis for Rate Structure Options
Rate Structure Options & Bill Impacts
Timeline for Selection of New Rate Structure
3
1. WSSC’s current rate structure was adopted 25 years ago and good management practice dictates periodic review of rate structure alternatives.
2. The Maryland Public Service Commission (PSC) ordered WSSC to develop a new rate structure. The PSC found the existing rate structure to be preferential to low-usage customers.
3. A new rate structure is intended:
• To better align costs to produce and deliver safe, clean water with rates;
• To reflect customer and Commission rate setting policy goals and objectives; and
• To provide a more predictable revenue stream to pay for infrastructure improvements.
4
Current 16-Tier rate structure charges customers at their highest level of water use back to the 1st
drop
Common practice is to charge for usage that falls within each tier
5
CombinedWater & Sewer Rates Per 1,000 Gallons
Average Daily Consumption (ADC) Effective
Range July 1, 2017
(Gallons Per Day)
0-49 $ 7.95
50-99 9.12
100-149 10.38
150-199 11.83
200-249 13.27
250-299 14.38
300-349 15.29
350-399 15.99
400-449 16.46
450-499 16.95
500-749 17.28
750-999 17.68
1,000-3,999 18.26
4,000-6,999 18.67
7,000-8,999 18.94
9,000 & Greater 19.36
WSSC’sCurrent 16-Tier Rate Structure
June – October 2016: Bi-County Rate Structure Working Group develops viable rate structure options
November 2016 – January 2017: Stakeholder Representative Group meets to review & provide input on rate structure options
April 2017: Cost of Service Study completed
May – July 2017: WSSC holds public informational meetings on rate structure options
June – September 2017: WSSC Commissioners hold 4 special public sessions on rate structure policies & options
6
7
11 public meetings attended by nearly 1,000 WSSC customers
4 special Commission meetings on the rate structure
3 direct mailings to all customers
All WSSC meetings livestreamed and seen by nearly 2,000 viewers
Radio ads on key stations
English/Spanish outreach
Paid social media ads
News releases/earned media
Elected official notification
wsscwater.com/ratestudy
8
Policy Considerations Score
Revenue Stability 17
Conservation/Demand Management 15
Rate Stability 15
Affordability 14
Ease of Understanding 12
Ease of Implementation 11
Minimize Customer Impacts 11
Cost Based Rates 6
Experts developed industry best practice rate structure options
Only one customer class per Maryland state law
Only consumption within a tier is billed at that tier’s rate
9
Basis for rate design is 3 person household
Typical household size in WSSC service area is 3 people
93% of all bills are for residential customers
75% of residential households are 3 or less people
95% of residential households are 5 or less people
10
26 gallons per person per day is the World Health Organization estimate of minimum sanitary needs
80 gallons per day – Minimum sanitary needs for a 3 person household
165 gallons per day – Based on average per person consumption of 55 gpd for a 3 person household
275 gallons per day – Based on average per person consumption of 55 gpd for a 5 person household
9,000 gallons per day – Consistent with WSSC’s top tier in current rate structure
11
12
Water & Sewer Tiers (gpd)
Uniform No Tiers in a Uniform Rate
3 BlockInclining
Option A
0-80
Option B
0-165
81-165 166-275
>165 >275
4 BlockInclining
Option A
0-80
Option B
0-80
81-165 81-165
166-275 166-9,000
>275 >9,000
13
Annual bill is between 1.0% and 1.3% of Median Household Income
Lowest income bracket is between 4.0% -5.0% of Household Income
Average Family Impact – Using 55 gpd per Person for a 3-person Household
Combined Rate($/kgal)
Current Bill($/quarter)
Bill ($/quarter)
$Change($/quarter)
Uniform $14.73 $205.45 $248.95 $43.50
14
15
16
3 Block Option A: Annual Bill is 0.8% - 1.1% of Median Household Income
Lowest income brackets is between 3.4% - 4.2% of Household Income
3 Block Option B: Annual Bill is 0.7% - 1.0% of Median Household Income
Lowest income brackets is between 3.0% -3.7% of Household Income
Average Family Impact – Using 55gpd per Person for a 3-Person Household
W/Sewer Tiers (gpd)
CombinedRate ($/kgal)
Current Bill($/quarter)
Bill($/quarter)
$ Change($/quarter)
3 BlockInclining
Option A
0-80 $10.66
$205.45 $210.06 $4.6181-165 $13.43
>165 $17.61
Option B
0-165 $10.41
$205.45 $184.15 ($21.30)166-275 $13.89
>275 $19.96
17
18
19
4 Block Option A: Annual Bill is 0.8% - 1.1% of Median Household Income
Lowest income brackets is between 3.3% - 4.0% of Household Income
4 Block Option B: Annual Bill is 0.8% - 1.1% of Median Household Income
Lowest income brackets is between 3.4% -4.1% of Household Income
Average Family Impact – Using 55gpd per Person for a 3-Person Household
W/Sewer Tiers (gpd)
CombinedRate ($/kgal)
Current Bill($/quarter)
Bill($/quarter)
$ Change($/quarter)
4 BlockInclining
Option A
0-80 $10.66
$205.45 $200.62 ($4.83)81-165 $12.25
166-275 $14.86
>275 $18.74
Option B
0-80 $10.66
$205.45 $207.34 $1.8981-165 $13.09
166-9,000 $16.16
>9,000 $20.52
20
21
22
All 5 of the proposed rate structure options are subject to change by the WSSC Commissioners
The Commission could request different or additional options based on public hearing input, the need for further analysis, or other policy reasons
23
Your feedback is very important to us
Each speaker has a maximum of 3 minutes
Happy to answer questions after testimony portion of meeting
Written testimony accepted through noon on Oct. 31, 2017
Mail to: WSSC Budget Division, 14501 Sweitzer Lane, Laurel, MD 20707
Email: [email protected]
24
25
Water & Sewer Tiers (gpd)
Uniform$14.73 ($/kgal)
$14.73 ($/kgal)
3 Block Inclining
Option A
0-80 $10.66
Option B
0-165 $10.41
81-165 $13.43 166-275 $13.89
>165 $17.61 >275 $19.96
4 Block Inclining Option A
0-80 $10.66
Option B
0-80 $10.66
81-165 $12.25 81-165 $13.09
166-275 $14.86 166-9,000 $16.16
>275 $18.74 >9,000 $20.52