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Item 4 - PH on MWMC Reg. SDCs
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Item 4 - PH on MWMC Reg. SDCs
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6/14/2004
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Appendix C1 <br /> <br /> Local Wastewater System Charge Detail <br /> <br />1.0 Local Wastewater System Methodology <br /> 1.1 Local Wastewater SDC Formula <br /> The general methodology used to develop SDCs includes the following four steps: <br /> <br /> · Determine value of growth-related capacity <br /> · Define system capacity <br /> · Calculate unit cost of growth-related capacity <br /> · Develop SDC rate schedule <br /> <br /> Each step is discussed below and related information is displayed in Table 6. <br /> <br /> 1.1.1 Step 1 -- Determine Value of Growth-Related Capacity (In 1998 dollars -- see current values in Table 6) <br /> <br /> In Eugene, as in most communities, a portion of the capacity needed to serve <br /> new development will be met through a combination of existing available system <br /> capacity, and additional capacity added by planned system improvements. The <br /> reimbursement fee is intended to recover the costs associated with the growth- <br /> related (or available) capacity in the existing system, and the improvement fee is <br /> based on the costs of capacity-increasing future improvements needed to meet <br /> the demands of growth. <br /> <br /> Reimbursement Fee <br /> <br /> Calculation of the reimbursement fee begins with a review of utility fixed asset <br /> records to determine the value of the existing local wastewater system. The <br /> system value is based on Replacement Cost New which is a method that <br /> involves assigning asset values on the basis of what it would cost in current <br /> dollars to construct an equivalent set of infrastructure assets subject to current <br /> market conditions, regulatory requirements, and technological advances. The <br /> total value of the existing local wastewater system, including gravity lines (net of <br /> assessments), force mains (or pressure lines), and pump stations was estimated <br /> to be $96.1 million. Approximately $8.9 million of assets were funded from <br /> grants. Like assessments, grant funds are deducted from the system value in <br /> the SDC analysis because general system users did not fund these assets. Net <br /> of grants, the total value of the existing system is approximately $87.2 million. <br /> <br /> Because reimbursement fees are intended to recover the value of the system's <br /> unused or available capacity, the total equity in the system is split between <br /> existing customers and new development based on the estimated proportionate <br /> use of capacity. The reimbursement cost basis is equal to the system equity <br /> associated with the capacity available to serve new customers. App.roximately <br /> 52% of the existing system is available to meet the demands of new customers. <br /> Therefore, the value of available (or growth-related) capacity in the existing <br /> system is $45.3 million (net of grants). <br /> <br /> City of Eugene SDC Methodologies Wastewater, <br /> <br /> <br />
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