Consumption-Based Fixed Rate Water Model

As reported in The Davis Enterprise (Davis, California) - How the city arrived at the proposed rates.

The city describes the consumption-based fixed rate model this way: ”The supply-charge fee is calculated by using the projected annual revenue requirement related to water supply and treatment and dividing it by the total projected six-month peak period (May through October) water use of the water utility to produce a per-ccf rate.

“The individual fee per customer is then calculated by taking the per-ccf rate and multiplying it by the individual customer’s prior year’s six-month peak period water use. Each year, this CBFR amount is recalculated based on an individual’s actual water use during the prior six-month May-through-October peak consumption period. So for Jan. 1, 2015, the May-October of 2014 total volume will be used. The supply charge will comprise approximately 67 percent of an average monthly water bill.”

While perhaps complex, the city felt comfortable enough that it could print this rate structure on Prop. 218 notices that are sent to property owners to inform them of pending rate increases.