Item 4 - PH on MWMC Reg. SDCs - Laserfiche WebLink

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SYSTEM DEVELOPMENT CHARGE METHODOLOGY Once project costs have been allocated to system component and project type categories, and the costs have been distributed to the system capacity parameters, the final step in the project cost allocation process is to assign costs to user types. For the purposes of the SDC methodology, there are two user types: 1) existing customers, and 2) new customers or growth. Costs that are allocated to growth are incorporated into the SDC improvement fee calculation. Costs allocated to existing customers must be paid through some other funding sources (e.g., existing reserves or future user rates). As indicated in Figure 3, the allocation of project costs to growth is a function of the type of project and a detailed capacity analysis that identifies growth's share of: 1) planned capacity expansion, and 2) total future load. Costs by capacity parameter are allocated to growth as follows: Capacity Projects: Growth's share of capacity expansion (%) X project cost ($) Performance Upgrades: Growth' s share of total future system capacity (%) X project cost ($) Rehabilitation Projects: Allocation to growth = 0% Where: 1. Growth's share of capacity expansion = Projected growth capacity requirement (not met by existing available capacity) divided by additional capacity to be added to the system by planned improvements. 2. Growth's share of total future system capacity = Projected growth capacity requirement (total) divided by total future system capacity requirement. Table 6 summarizes the growth allocation percentages by project type. The documentation for these figures is provided in Appendix C. TABLE 6 Growth Allocation Percentages by Project Type Project Type Average Flow Peak Flow BOD TSS Capacity (growth's sham of capacity 100% 29.4% 100% 100% expansion) Performance (growths sham of total 26.1% 10.8% 25.9% 26.1% future system capacity) Rehabilitation 0% 0% 0% 0% Source: 2004 Facilities Plan Step Four- Adjustments The methodology includes the following adjustments to the reimbursement and improvement fee cost bases: · Gifts or grants from federal or state government or private persons. Existing (and if applicable in the future, planned) asset costs are reduced by the percent of the asset that is funded by grants. SEA31003271388(DG).DOC/041040034