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City of Pleasanton
<br />2025 Water Rate Study
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<br />Water Resources Economics
<br />57
<br />3.6 ALLOCATION TO COST COMPONENTS
<br />PRELIMINARY COST-OF-SERVICE ALLOCATION AND GENERAL REALLOCATION
<br />Table 3-10 shows the preliminary cost-of-service allocation prior to any adjustments and the adjusted cost-of-service allocations after the
<br />General cost reallocation. The Operating costs (Line 1) are equal to the total Operating revenue requirements (Table 3-1, Line 16) allocated to
<br />each cost component based on the Operating allocation (Table 3-6, Line 11). The Capital costs (Line 2) are equal to the total Capital revenue
<br />requirements (Table 3-1, Line 16) allocated to each cost component based on the Capital allocation (Table 3-7, Line 11). The Revenue Offsets
<br />(Line 3) are equal to the total Revenue Offset requirements (Table 3-1, Line 16) and are allocated based on the Revenue Offset allocation (Table
<br />3-8, Line 10). Note that the total cost-of-service (Line 4) is equal to the total rate revenue requirement for FY 2024 (Table 3-1, Line 16).
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<br />The next step is to reallocate General costs (Line 5) based on the proportion of costs in each cost component (except General and Revenue
<br />Offset, which is restricted to specific revenues only) in the preliminary allocation. The total revenue requirement (Line 6) stays the same after the
<br />General cost reallocation.
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<br />Table 3-10: Cost-of-Service Allocation by Cost Component (Preliminary, General)
<br />Line Revenue Requirement Meter Customer Water Supply Delivery Conser-
<br />vation Rev. Offset General Total
<br />1 Operating Costs $112,834 $725,950 $18,934,125 $507,779 $225,289 $0 $6,351,368 $26,857,345
<br />2 Capital Costs $545,199 $0 $124,517 $9,481,377 $0 $0 $468,606 $10,619,699
<br />3 Revenue Offsets $0 $0 $0 $0 $0 ($470,000) $0 ($470,000)
<br />4 Primary Allocation $658,033 $725,950 $19,058,642 $9,989,155 $225,289 ($470,000) $6,819,974 $37,007,044
<br />5 General Cost Allocation $146,386 $161,495 $4,239,787 $2,222,188 $50,118 $0 ($6,819,974) $0
<br />6 Adjusted for General $804,419 $887,445 $23,298,430 $12,211,343 $275,407 ($470,000) $0 $37,007,044
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