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u N 4. Detailed Proposal <br /> City of Pleasanton I Water and Wastewater Rate Study <br /> Cost of Service Study Steps (Continued) <br /> a Step 6 - Summary of the Cost of Service: The previous step distributed plant and <br /> expenses to each customer class of service. From this process, a summary page can be <br /> developed that compares the difference between the current levels of rate revenues <br /> received from each class of service, and the distributed cost of service for each class. <br /> The summary page provides an important measure of the equity of the current rates in <br /> comparison to the cost of service. In addition to the summary page, average unit costs <br /> (i.e., cost-based rates) are also developed for each customer class of service. Average <br /> unit costs provide the City with an understanding of the cost/rate relationship between <br /> fixed and variable costs. <br /> • Step 7 - Internal Review Meeting: HDR will meet with City staff to review the results of <br /> the draft water and wastewater cost of service analyses. HDR will explain the overall <br /> methodology used within the cost of service analyses, along with the key assumptions <br /> used within each study. <br /> Task 5 - Proposed Water and Wastewater Rates <br /> Task Objective: Utilize the cost information developed as a part of the previous tasks to <br /> develop water and wastewater rate design alternatives for consideration <br /> by the City that comply with Proposition 218. As appropriate, develop rate <br /> structure alternatives to address the City's rate design goals and <br /> objectives, while providing rates that recover the cost of providing service. <br /> As part of this task, other miscellaneous water wastewater fees will also be <br /> reviewed and updated. <br /> Task Approach: • Utilize the results of the revenue requirement and cost of service <br /> analyses to establish the proposed: <br /> ✓ Potable water rates. <br /> ✓ Recycled water rates. <br /> ✓ Wastewater rates. <br /> ✓ Conservation (drought) rates. <br /> • Review the current rate structure. <br /> • Develop customer bill comparisons. <br /> • Develop neighboring bill comparisons. <br /> • Review and update of other miscellaneous water and wastewater fees. <br /> 4-10 15007 <br />