Laserfiche WebLink
<br />TABLE 2 <br />Example Calculation for Single (Average Flow) Capacity Parameter* <br />Existing Future <br />Element Total System Expansion <br />Determine Capacity Needs <br /> <br />Systemwide Capacity (mgd) 60 50 10 <br />Existing Users (mgd) 45 45 0 <br />Growth (mgd) 15 5 10 <br />Determine Cost Basis Needs <br /> 10% 100% <br />Systemwide Cost $50,000,000 $12,000,000 <br />Growth Cost $17,000,000 $5,000,000 $12,000,000 <br />Determine SDC Schedule <br /> <br />Weighted Average Unit Cost ($/mgd) $1,133,333 $333,333 $800,000 <br />User Capacity Requirement (mgd) 0.00035 0.00035 0.00035 <br />Total SDC <br />$396.67 $116.67 $280.00 <br />*Example only; not MWMC specific <br />The example reimbursement fee cost basis includes 10 percent ($5 million) of existing <br />system value, associated with providing 5 mgd of capacity. The improvement fee cost basis <br />includes the costs to expand the facilities by 10 mgd, in this case estimated to be $12 million. <br />The total costs allocated to growth are equal to the total capacity required by growth (5 mgd <br />existing +10 mgd expansion) = 15 mgd total. <br />At this point the SDC schedule can be developed. First, the weighted average unit costs are <br />developed. This is accomplished by dividing the reimbursement fee and improvement fee <br />cost bases by the total growth capacity units (15 mgd in this case). By dividing the individual <br />fee elements by the total growth units, the combined fee is based on a weighted average cost <br />per unit. This is demonstrated in Table 2 where the individual unit costs are $333,000 per <br />mgd ($5 million/15 mgd) and $800,000 per mgd ($12 million/15 mgd), respectively, for <br />reimbursement and improvement elements; and $1.1 million per mgd ($17 million/15 mgd) <br />overall. The SDC for a user who requires 350 gallons per day (.000350 mgd) would equal <br />$116.67 reimbursement ($333,333 X 0.000350) + $280 improvement ($800,000 X 0.00035) for a <br />total of $396.67. The same fee would result from using the total cost per unit ($1.13 per <br />gallon per day) multiplied by the 350-gallon-per-day user requirements. <br />As the example demonstrates, the methodology meets the key requirements of the law, as <br />identified in Table 1: <br />? <br />Determines the amount of available capacity that exists and allocates costs to growth <br /> <br />accordingly. <br />? <br />Allocates improvement costs to growth in proportion to future capacity needs. <br /> <br />Page 8 OF 39 <br /> <br /> <br /> <br />