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12.J.3. REUSE RATE STUDY <br />Director Olson recalled that on January 19, 2010, the Board requested staff and the <br />Consultant review additional items in order to clarify the potential rates, the possibility of R&R <br />(renewal and replacement) at a 10% rate, the time value of money, and the rate study as if it were <br />a return on an investment process or utility basis which provides four rates/options in the <br />process. He said the end goal is to establish the rates and keep them stable for five years or <br />more. <br />Eric Brodkey, Camp Dresser & McKee, Inc., provided the project's history, the four <br />exhibits under consideration, and the proposed rates for each. <br />The Board discussed the reuse water system, proposed rates, reductions in use, and <br />residents using reuse water as an alternative. <br />Vice Chairman Solari suggested approving the reuse rate at 60 cents per 1,000 gallons for <br />the first year, then increasing it annually by 4 cents until it caps out at 88 cents per 1,000 gallons <br />for five years. <br />Commissioner Wheeler supported Vice Chairman Solari's approach but suggested <br />increasing the annual amount from 4 cents to 7 cents. <br />MOTION WAS MADE by Vice Chairman Solari, <br />SECONDED by Commissioner Wheeler, to set a reuse <br />rate beginning at 60 cents per 1,000 gallons, increasing the <br />rate annually by 7 cents per year until it caps out at 88 <br />cents per 1,000 gallons, and at that time reevaluate the <br />rates. <br />24 <br />February 16, 2010 <br />