People’s Vanguard of Davis and Davis Media Access Invite Public to “Measure I” Forum
The People’s Vanguard of Davis, a 501(c)(3) non-profit, and Davis Media Access (DMA) are co-sponsoring a roundtable forum on Measure I, also known as “The Surface Water Project.” Voters will have the opportunity to vote on Measure I in an all-mail only Special Election, March 5, 2013.
The purpose of this event is:
- To enable community members to hear the perspective of proponents and opponents of the water project
- To enable community members to obtain answers to critical questions and express opinions about the water project.
Both proponents and opponents of Measure I have been invited to participate. Each side has been given the opportunity to have three people on the panel. Two of the three are considered advocates or supporters of either “No on I” or “Yes on I” and the third person is considered a technical expert on a critical aspect of the project including hydrology, financing and water policy
The proponents representing Yes on Measure I include Joe Krovoza and Alf Brandt.
Opponents representing No on Measure I include former city councilmember Sue Greenwald
The technical experts who will be present include: Professor Graham Fogg for hydrology, Rob Roscoe for finance and Walt Sadler for water policy.
- Graham Fogg, PhD, is a Professor of Hydrogeology and Hydrogeologist at UC Davis with specific expertise in groundwater contaminant transport; groundwater basin characterization and management; long-term sustainability of regional groundwater quality; vulnerability of aquifers to non-point-source groundwater contaminants.
- Walt Sadler, PE, has over 40 years of experience both as a consultant and staff for Municipal Agencies; Past Chair of the Sacramento Groundwater Authority (SGA); involved in the design, construction, and management of numerous water supply projects including aquifer storage and recovery (ASR) wells, water supply wells, water treatment facilities, pump stations and distribution facilities throughout the Central Valley.
- Robert S. Roscoe, PE, has over 35 years of experience in public water supply finance, management and engineering. He is the President of Sacramento Suburban Water District Financing Corporation; General Manager of Sacramento Suburban Water District, which serves a population of about 170,000; and Chair of the Regional Water Authority Representing water purveyors in Sacramento, El Dorado Placer and Yolo Counties.
“The format will be a question & answer roundtable discussion among proponents and opponents of Measure I and technical experts on water,” said David Greenwald, Executive Director of the Vanguard who will moderate the forum. “Davis Media Access (DMA) is serving as a co-sponsor of the forum, which will be aired on Channel 15 and on their website at a later date to-be-determined. We’re happy to be partnering with DMA, because they are such a valuable resource to our community. It’s the reason we have teamed up with them over the years to bring town hall forums to the citizens of Davis.”
Editorial Board Members of the Vanguard encourage citizens to attend and learn more about Measure I. “The purpose of the roundtable discussion is to educate members of the community on this important issue facing voters in March. It’s an all-mail ballot issue that is just around the corner and the Editorial Board and I want to make sure that voters have the opportunity to hear both sides and ask questions,” said Greenwald. For more information about the forum please call Cecilia at (530) 400-2511.
i find myself at an interesting quandary. i am not comfortable with this project but i don’t want to reward harrington’s conduct.
No argument here, GI. Maybe we could get to a more comfortable place about the project if Michael wasn’t so prolific in his misrepresentations about the project itself and motives of those who support the project.
I’m not ready to give David a pass for the one-sided tone and content of the dozens(?) of reports in recent months. I think if the [i]Vanguard[/i] would have called out Michael for his most egregious comments, the issue would have had a better level of understanding amongst its readers by now.
On the other hand, my feeling is that a majority of voters already have made a judgment about “Harrington’s conduct” on this matter.
Sigh …. personal attacks again.
Our Committee knows we are dead-on right to oppose this unnecessary pork barrel project wearing lipstick, so your shooting the messenger does nothing against us, or advance your project.
The forum is all about the Yes on I. They set it up with the DV, and then told us how high to step and march.
The City is a political litigant, and it’s in their chambers, using their equipment, using their paid staff, and two of the three “experts” are their experts/consultants.
SO the Yes on I has 2 advocates, and two of the three experts.
None of the three “experts” are neutral, yet the DV pretends they are.
David Greenwald refused to call me or email back all week to discuss the process or forum protocal. He set it up with Yes on I, and told us their decision.
This forum is not neutral, and not objective, and basically a campaign tool for the Yes on I, using a non-profit organization and city facilities.
I call them as I, and the No on I Committee, see them.
David: if you argue with me, I will post all the emails.
Here we go again; we can’t even have a debate without controversy.
David, please respond asap to this attack.
I for one, do not want to come if it truly ISNT formatted into as objective a forum/debate as possible.
I would urge both sides to choose articulate, concise proponents for their side(s).
Michael, there is a long history of the Vanguard hosting forums. Was the recent School Board Candidate forum all about Jose Granda and Claire Sherman? Or was it all about Susan Lovenberg and Nacy Peterson?
The format is set up to encourage the two sides of the discussion to talk with/debate one another. Do you have doubts about the loyalty of Sue Greenwald and Mark Siegler (the two advocates for the No On Measure I side) to your cause?
The No On I team put forward Walt Sadler as their choice as an expert. The Yes On I team put forward Jay Lund as their choice as an expert. Jay could not attend due to a prior commitment, so the Yes On I side has no expert at all. The Vanguard Editorial Board felt we needed someone to address straightforward questions about interest rates and financing and hydrology so we added Graham Fogg and Rob Roscoe because of their clear expertise in those two areas. Final project costs are as yet unknown, but that is a separate issue from finance and interest.
Here are the bios of the three experts. What is there about any of the three of them that is questionable?
[i]Graham Fogg, PhD – Professor of Hydrogeology and Hydrogeologist at UC Davis with specific expertise in groundwater contaminant transport; groundwater basin characterization and management; long-term sustainability of regional groundwater quality; vulnerability of aquifers to non-point-source groundwater contaminants.
Robert S. Roscoe, PE – Over 35 years of experience in public water supply finance, management and engineering; President of Sacramento Suburban Water District Financing Corporation; General Manager of Sacramento Suburban Water District, which serves a population of about 170,000; Chair, Regional Water Authority Representing water purveyors in Sacramento, El Dorado Placer and Yolo Counties;
Walt Sadler, PE – Over 40 years of experience both as a consultant and staff for Municipal Agencies; Past Chair of the Sacramento Groundwater Authority (SGA); Involved in the design, construction, and management of numerous water supply projects including aquifer storage and recovery (ASR) wells, water supply wells, water treatment facilities, pump stations and distribution facilities throughout the Central Valley.[/i]
The intent of having the expert panel is to provide a dispassionate voice if and when a question produces answers from the two panels that are clearly at odds with one another. If no such situation arises then they may end up not saying anything throughout the forum.
SODA said . . .
[i]”Here we go again; we can’t even have a debate without controversy.
David, please respond asap to this attack.
I for one, do not want to come if it truly ISNT formatted into as objective a forum/debate as possible.
I would urge both sides to choose articulate, concise proponents for their side(s).”[/i]
SODA, did my response to David above answer your concerns?
1. The Yes panel and the No panel will ask the questions. The experts will not ask questions. After each panel has asked and answered the questions prepared by the two panels, questions will be taken from the audience.
2. As we did in the School Board candidate forum, each panel will ask one of their questions, listen to the other panel’s answer, and then provide their own answer to the question. Then that process will be repeated with the other panel asking one of their questions. Each panel will ask five questions. The intent of having the expert panel is to provide a dispassionate voice if and when a question produces answers from the two panels that are clearly at odds with one another. In such a case, the expert panel will signal to the moderator that they have [u]objective information[/u] to share on the question that will help the audience weigh the differences between the advocacy answers that the two panels have provided to that question.
3.The intent of the format is to encourage debate directly between the two sides. Each panel will be talking directly to the other panel.
Yes, Matt and thanks once again!
I like the idea of the experts and hope there will be statements that are made that the experts can ‘correct, clarify, refute’ in the interest of honest data.
I wish though that the two sides were not the ones asking the questions, but perhaps it will work out fine. I had hoped there would be a format that would take some of the claims on both sides and have each address those. That is what is so confusing to me!
The DV refused to discuss forum process with us.
The No on I will attend, under protest.
Michael – You wrote:
[quote]The forum is all about the Yes on I. They set it up with the DV, and then told us how high to step and march. [/quote]
As a member of the Vanguard Editorial Board (David, Cecelia Escamilla Greenwald, Matt Williams, Tia Wills and me) I can tell you and all the Vanguard readers that this statement is not true. The Vanguard Editorial Board ALONE discussed whether to sponsor a water forum and decided to use the format we had used during the School Board Candidates forum, whereby each side (in that case each candidate) formulates and asks the questions of each other and then have a chance to answer their own questions. This approach was greatly appreciated by the candidates in that forum and we decided it would be good to use it in this forum as well.
Also, like the candidate’s forum we decided to reserve time for questions from the audience.
As to the the use of experts, I don’t see anywhere where we said they would be neutral. We only said they would be experts in a particular area of the entire water issue: policy/legal, hydrology and financing. The reason we decided to have experts was in case questions came up that required particular expertise for a full answer. The intent was NOT that they would “cheerlead” for one side or the other. Given the format, it would be easy for either side to call out if they felt an expert was overtly promoting one side or the other. The water issues are highly complex and we felt it was in the public’s interest to have complex questions responded to.
We asked each side to suggest two people who would be proponents of their position and to suggest one technical expert. Matt has explained how we arrived at the final three experts. Only proponents and opponents ask questions but the experts can weigh in with answers as appropriate
I was tasked with taking these points and developing a full design for the forum. I did that–writing out a clear purpose statement and proposing time limits, etc.
[b]At NO TIME did I ever consult with a proponent of Measure I in formulating the design of the forum[/b].
Though you will no doubt not believe me, the entire conversation among members of the Vanguard Editorial Board was about how to have a forum during which the questions that are circulating in the minds of the citizens of Davis could be clearly answered. Our overarching concern was to create an environment in which the sides could clearly share their perspectives, with members of the public going away better informed than when they came in.
I would ask you to retract the incorrect statements you have made here. For my part, I greatly desire the participation of both sides on Saturday and think we will have the kind of dialogue on this challenging issue that we all desire.
SODA said . . .
[i]”Yes, Matt and thanks once again! I like the idea of the experts and hope there will be statements that are made that the experts can ‘correct, clarify, refute’ in the interest of honest data.
I wish though that the two sides were not the ones asking the questions, but perhaps it will work out fine. I had hoped there would be a format that would take some of the claims on both sides and have each address those. That is what is so confusing to me!”[/i]
There will be a significant amount of time after the panel questions for audience questions. What are some of the questions you would like to see answered. Which claims would you like to have the confusion reduced?
Will it be live-streamed, or — even better — recorded?
[i]I would ask you to retract the incorrect statements you have made here.[/i]
Yes, that would be good.
It will be recorder, that’s DMA’s involvement.
1. The issue of fines. When, how much, if at all?
2. Both sides address the need for the 12 units for Davis. Is it too much or allows for small amt growth?
3. What the negotiations with W Sac really were; is it viable to come back if I fails? The whole issue of perpetual contract.
4. Taste test of W Sac water VS what JPA will be (ozone treated vs chlorinated)
5. What do the No on I group propose if I fails?
That’s a start. These were recent he said/she said issues that have confounded the thinking.
“”Davis Media Access (DMA) is serving as a co-sponsor of the forum, which will be aired on Channel 15 and on their website at a later date to-be-determined. We’re happy to be partnering with DMA, because they are such a valuable resource to our community.”
Yeah, now I realize I should have read all the way through!
Thanks SODA –good questions–really good questions. I share some of them. Hopefully we will hear some helpful input on these questions on Saturday.
It sounds like the the Vanguard Editorial Board put a lot of effort into creating an informative and fair forum, with equal opportunity for both Yes and No to select participants.
How will you control for “speechifying” during audience questions?
Apologies: Editorial Board Member is Tia Will not “Wills” (sorry Tia–failed to proofread).
Ryan – Our plan is to take written questions from the audience and have the moderator read them.
What if you cannot attend, nor view streaming on an iPad? Can a video of the forum be posted somewhere to view later?
“Our plan is to take written questions from the audience and have the moderator read them.”
Are you going to read all of the questions or will they be cherry-picked?
rusty49 – I doubt we will have time to read all the questions. We expect that some will be touched upon in the initial back and forth between proponents and opponents. We also expect that there will be some overlap in questions (similarities of theme). However, it is possible that some selection will have to be made. We will attempt to select them to assure that the broadest diversity of questions is achieved.
So the simple answer to your question is “No” we will not be cherry picking questions. We genuinely want as broad a set of issues raised as possible given the time constraints.
Ryan – From the press release above:
“Davis Media Access (DMA) is serving as a co-sponsor of the forum, which will be aired on Channel 15 and on their website at a later date to-be-determined.”
not possible to get on ipad if using the same technology….old issue.
I can confirm that the Yes on Measure I committee had no input in forum process or format. In fact, I will be sending this article to our forum participants and other members of our committee to let them know what the process and format will be.
As a programming note, unfortunately, Alf Brandt will not be available next Saturday like he had hoped. Elaine Roberts Musser will take his place as one of the Yes on Measure I advocates.
I would like to get a better understanding of how the ground water and surface water “blending” is going to take place and will all of Davis basically get the same benefit(?) if this project is approved.
When they first installed water meters in the south area, I don’t think duplexes were included. Is that still the case?
The water forum this afternoon at Rancho Yolo was quite informative,
but Elaine’s portion was way too long. The Yes on I people took 40 minutes of the hour allotted. The time scheduled had to be extended so the No group had a fair chance to explain their position.
The relationship of increased water supply, and its location, to developer interests, was most enlightening.
“The relationship of increased water supply, and its location, to developer interests, was most enlightening.”
Let’s hope the rest of Davis can become enlightened.
I stand by what I posted.
In the future, if the DV or any other group wants a forum, a better process should be:
1. Invite reps from both campaigns, candidates, etc to a formal sit down. Discuss the forum, location, process, ground rules, moderator, experts or not, how many advocates per side.
This was not done, and was basically jammed down our throats. We repeatedly, over and over, attempted to discuss. THe idea of having Matt as moderator was …. revealing. Basically we got a f-u, it’s our way or the highway. Then days of silence. Then the posting this morning.
In the end, we will show up and try our best against this huge, well-oiled, well-funded political machine that is going to use the DV and our own city chambers for this dog and pony show that to us appears rigged for the Yes on I and plays to all of their money and organization. No on I has little money, and an all-volunteer small band of local residents who have no conflicts of interest.
I am an aviation and marine trial attorney, and i know a neutral forum and process when I see one.
There is not a bat’s chance in heck that the way this forum was handled, or its location, or the piling on of these “experts” presented as some sort of innocents or “Joe Fridays” is neutral or conducive to our going in there on Saturday afternoon and being treated fairly.
The DV is going to get this one, but not again using the same process it did here. Just letting you know.
BTW, I know that emails are terrible ways to solve problems, and it’s always better to sit down and work things out before misunderstandings set in and wreck the process. I tried over and over to sit down with the DV to discuss, and was refused. Their process to the No on I ended with the f-u email, and then when I stood my ground for a dialogue, a member of the Board went around me and straight to others on No on I, playing people off each other.
SODA: good point about the video stream being playable on ipad and iphones. How to fix?
No on I was very convincing this afternoon. Hard to hide the truth for long.
The truth about what?
Does everyone registered to vote get to vote on this even if they aren’t currently paying water bills or owning any property in Davis?
Registered voters who live in Davis get to vote on this.
I’m glad that the Vanguard Editorial Board went ahead with their plans and did not allow Mike Harrington to script the forum. I really don’t care for Mike’s petulant whining over not getting his way.
Thank you. I was reading the rate structure and realize that there is something fundamental I don’t understand.
Why does the City to propose rates when the actual operating cost is not being incurred? Shouldn’t those rates just be estimates?
[REF] ([url]http://public-works.cityofdavis.org/water/rates/proposed-water-rates/all-debt-scenario-rates[/url])
* * *
The following is just to explain what the perspective I come from because I understand that my view could be detached from how reality works.
In my mind the order is this:
1. City makes an estimate of the monthly cost of the water system
2. From that estimate, City gives us a monthly estimate of our bills
3. City asks us whether those monthly estimates seem affordable
4. We either agree or reject the proposal. If we agree, then the plan proceeds
5. water system is now being built, and the bills start to need to be paid
6. Each month, City checks our water usage and split the monthly bill accordingly
In step 2, the monthly estimate should include everything that the city needs to spend for the construction of the new plant and for the operation of the existing system.
For example, suppose Davis has only two people: You and me, and in February 2013, you used 55% of the water and I used 45%. If the monthly cost is $1 million for February 2013, then when February ends, you will pay $550K and I will pay $450K, even if you only used 5.5 gallons of water and I only used 4.5 gallons. The rate would not be fixed.
Why are the rates fixed? What if the City collects too much or too little?
On the water bills, could we see these graphs:
1) Estimated monthly total expenses of the water system
2) Actual monthly total expenses of the water system
3) Actual monthly total water usage of the city
4) My monthly water usage as a percentage of (3)
5) My monthly water bill as a percentage of (2)
Such a graph will help me get a update on the status of the project every time I see my bill. It allows me to see if the actual expenses deviate from the estimation, and whether I pay a disproportional amount for my usage.
Edgar Wai asked . . .
[i]”Why does the City to propose rates when the actual operating cost is not being incurred? Shouldn’t those rates just be estimates?”[/i]
Edgar, the rates included in the Prop 218 are indeed estimates. The way Prop 218 works the public sees the worst case scenario of expected costs. Those expected costs are supported by the detailed cost of service analysis prepared by Bartle Wells Associates, the City’s rate consultant. Prop 218 rules set an upperbound that actual rates can not exceed. That allows citizens like you and me to project the impact that the publicly noticed Prop 218 rates will have on our individual lives.
Should actual costs prove to be lower when actual construction bids are in hand, the governing body (in our case City Council) can choose to implement rates that are lower than the Prop 218 rates.
Re: Matt
Thank you.
“Should actual costs prove to be lower when actual construction bids are in hand, the governing body (in our case City Council) can choose to implement rates that are lower than the Prop 218 rates.”
Why can’t the rates be automatically calculated based on the actual costs when they are lower than the estimate? Then there will be no need to decide where the surplus would go, or what expenses would need to be cut when there is a deficit.
Are the 5 items I listed above on the current water bills?
As of now, when a residence calculate their percent of water used and the percent of bills paid, do these percentages match?
Suppose the inelastic expense of the water system is $100/month and the elastic expense is $1 per gallon.
If the rates are not fixed, 10 people using 10 gallons each would incur an expense of $100 + 10x10x$1 = $200. Split that for 10 people each person pays $20.
If the rates are fixed so that each person pays for $10 inelastic cost regardless whether they use the water, and $1 for each gallon they use, then the results are exactly the same. Each person will pay $20.
So far so good.
But what happens when the city expands and now has 11 people, each using 10 gallons?
Without fixed rate, we first calculate the total expenses, which is $100 + 11x10x$1 = $210. Split that and we get $19 per person. The bill for each person is now smaller because more people are splitting the inelastic cost.
With fixed rate, the calculation goes the other direction. We don’t start with the total expense of the system, we start with the amount we collect, which is: 11x ($10 + 10x$1) = $220. Since we know from the last paragraph that the total expense is actually $210, the billing system collected $10 extra.
I think the billing system should not be designed to collect this extra $10.
Edgat Wai said . . .
[i]”6. Each month, City checks our water usage and split the monthly bill accordingly .”[/i]
What you describe is in principle what the City is actually going to do. The time line of billing is indeed monthly.
With that said, there is a huge practical Achilles Heel associated with actually recalculating the full cost split for all the customers in the system each and every month. Specifically, such a monthly recalulation would create substantial fluctuations in individual customer bills. That uncertainty would be a customer service nightmare.
The total system-wide costs during a fiscal year will have very little month to month variation; however, the aggregate system consumption has very substantial month to month variation. 407,000 ccf in January/February, 574,000 in March/April, 961,000 in May/June, 1,187,000 in July/August, 906,000 in September/October and 514,000 in November/December. Dividing those very different numbers (July/August is essentially triple January/February is going to produce bills in July/August that are about one third of the size of the ones in January/February because you are dividing the same number up into many, many more parts. So when you are using more you would pay less and when you are using less you would pay more. How many people could wrap their heads around that conundrum.
To solve that you follow the exact same process you have described, but only calculate the split once a year, and then carry that split forward through for 12 months until the next split is calculated.
y from
Edgar Wai said . . .
[i]”Why can’t the rates be automatically calculated based on the actual costs when they are lower than the estimate? Then there will be no need to decide where the surplus would go, or what expenses would need to be cut when there is a deficit.”[/i]
Good question. The reason (as I understand it) is that adjusting actual rates has to be done by a discretionary decision by the district’s governing body (in our case the Council).
If you look at the video of tonight’s Council meeting you will see me make a public comment that asks Council to put together a permanent Rates Committee that would be tasked with evaluating the actual May-October data in early November and then forward to Council a recommended rate adjustment based on the actual consumption data. That would mean nothing would slip through the cracks, and the process would be transparent. I believe that would elevate the level of public trust.
Edgar Wai said . . .
[i]”I think the billing system should not be designed to collect this extra $10.”[/i]
That is the beauty of the CBFR system. It absolutely will not collect the extra $10. What it will collect is 100% of the system’s fixed costs . . . no more, no less. That means fiscal stability for the water agency [u]and[/u] fair rates at the lowest possible level for the consumers.
BTW, I’m not sure what you mean by “elastic cost” and “inelastic cost.” Can you explain those terms?
Re: Matt
Thank you for your reply and patience.
I think what I referred to as inelastic and elastic costs, you would call fixed cost and variable cost. I wasn’t using those terms following any standard terminology. I will use fixed cost and variable costs in the following.
The Fixed cost will include the construction cost and other costs that are not proportional to the clean water produced or consumed. Variable cost is directly proportional to the amount produced or consumed.
Based on what you said, the water system has very little variable cost. To me it means that the system is always running at full capacity regardless of consumption. Is this the water system:
o Every month, the system processes the same amount of water
o There is a storage for clean water, so that the extra water processed in winter can be used in the summer.
According to your numbers, the water system would have to process at least 379K ccf per month. Suppose the system is sized so that it produces 500K ccf per month at a cost of $500K. If no processed water is wasted, then each ccf would cost the consumer $1, because that is the cost of its production.
But the reality is that in such a system, 121K ccf per month would be wasted. To cover the cost of $500K, each consumer will have to pay $1.32/ccf. The rate $1.32/ccf is computed once a year.
If there is always a consumer for the extra clean water produced, the rate could stay at $1/ccf.
If the water processing can partially shut itself off when enough water is processed, the rate could stay at $1/ccf.
In this model, if everyone decide to cut water consumption in half, the plant is still producing 500K ccf per month, and 310K ccf per month will be wasted. To pay the fixed production cost, now the water rate would have to become $2.64/ccf.
The costs are still covered, but there is no incentive to save water because the rates are calculated to pay for the fixed cost. Is this the effect of CBFR? This matches the effect you described:
[i]”It absolutely will not collect the extra $10. What it will collect is 100% of the system’s fixed costs . . . no more, no less. That means fiscal stability for the water agency and fair rates at the lowest possible level for the consumers.”[/i]
The rates will be fair for all, but the consumers will be paying too much for their water if the plant is processing too much water. There is also no incentive to save water because the cost is fixed. (?)
In the actual system, will the plant adjust the operation so that if it is producing too much water it just shuts down itself to cut operation cost. If it can do this perfectly, the plant will only produce the same amount of water that is consumed with no wasted clean water. And in that case, the rate would just be $1/ccf in the example above. There will be no need to have a year-end tally, because the rate would just be the production cost per ccf.
If we only bill everyone once a year, we will know that the cost is not $1 per ccf but $1.32 per ccf. If the city could charge $1.32 per ccf, then the city is free to discard the extra 121K ccf of processed water. The consumers are paying $1.32 per ccf instead of $1 per ccf to cover the cost of the wasted processed clean water. The system processes too much water. It would be okay if the processing plant could shut down when there is enough stored clean water. If it can’t shut down the consumer are paying for the wasted processing.
If the system can partially shut down, then there is no reason to tally the consumption because the cost of each ccf consumed would just be the monthly fixed cost divided by the clean water processed.
Do you happen to know:
o How much water can the system process per month
o The storage size of clean water
o Can the processing throughout be adjusted (can it partially shut down to cut operation cost?)
o How much of the month cost of the built plant is fixed, and how much depends on the amount of water processed or distributed
Edgar, the issues you are addressing may best be addressed by a face-to-face discussion with the supporting charts and spreadsheets that Frank Loge and I have put together in our detailed and exhaustive research leading up to our formulation and refinement of the CBFR billing model. My cell phone number is 530-297-6237. Please give me a call and lets schedule some time together.
BTW, the questions you are asking are SUPERB.
[IMG]http://i1104.photobucket.com/albums/h321/mwill47/Commodity-DemandAWWA_zps99ea13e7.jpg[/IMG]
The graphic above provides a simple depiction of the Commodity-Demand model with the costs of water service allocated based on the characteristics of the expenditures. Allocation of major system capital expenditures could vary somewhat depending on the period of time used for the analysis. Because system capital expenditures can and do change over time, long term cost of service analyses frequently placed capital expenditure costs in the commodity cost category.
Throughout the 20th Century this model stood tall for a lot of reasons, one of which was that water consumption patterns supported a long term view of both system costs and rates. However, in the 21st Century changes in both water demand practices and water demand itself have transformed the steady year-to-year pattern of consumption show in green in the graphic below to the more challenging pattern shown in red. Further, this pattern is expected to continue due to the fact that the overall efficiency of urban water use has been increasing in virtually all communities throughout the United States.
[IMG]http://i1104.photobucket.com/albums/h321/mwill47/OWASAWaterSales_zps89c232d1.jpg[/IMG]
These changing consumption levels have forced water agencies to shift the time line of their cost and rate analyses from long term to short term to deal with the significant revenue losses associated with the reduced consumption.
Long term commodity-demand analyses have tended to be driven by the engineering decisions that created the water system. However, the shorter term analyses agencies have been forced to undertake in recent years are significantly affected by the decisions that an agency makes in financing its major capital costs. In our example water agency, the City of Davis, California, the result of those financing decisions are depicted in the graphic below. What was a 56-36 Commodity-Demand split of costs from the engineering perspective becomes a 72-20 Fixed-Variable split of costs from the accounting perspective, otherwise known as the Income Statement.
[IMG]http://i1104.photobucket.com/albums/h321/mwill47/Commodity-DemandCBFR_zps5d9021e5.jpg[/IMG]
The challenge that the resultant 80% fixed costs proportion poses is that the typical agency rate structure generates no more than 30% fixed revenue, so for each unit of conservation an agency loses considerably more revenue than cost. Further, the bottom-line of that structural deficit is that the more customers conserve the greater the agency’s deficit becomes.
As a solution to this problem we developed an extension of the philosophy that created water budget rate structures, by allocating fixed costs into a rate structure on a budget . . . the Consumption-Based Fixed Revenue water rate system that was recommended by the WAC and adopted by Council.
Re: Matt
Sorry I didn’t realize that I was talking to one of the people that created the CBFR. Thank you for your service.
I have been trying to identify my concerns so that there is a clear basis of comparison. So far I come up with these main items:
Concerns:
2) The water agency should have neither a profit nor a deficit
4) The billing rates should be proportional to water consumed for each individual
5) The water plant should not be treating too much water and asking the consumer to pay for that excess
6) The overall water bill for each individual should be minimized
8) The data about the water system should be available for the public for independent analysis
9) The water bills should make it easy for a person to tell if the water system is addressing their concerns
[img]http://skylet.net/docs/2013-01-30_-_Water.png[/img]
The whole list is here: [Scoring Sheet] ([url]http://skylet.net/docs/2013-01-30_-_Water.htm[/url]).
These are all the concerns I can think of. I think that if the water bill can show the data I listed, there will be less room for things to go wrong. I am hoping to get a better sense of how much monetary risk we are facing.
I have just sent you an Excel sheet that tries to show an estimation of concerns (2), (4), (5), (6) over 36 years. I hope that the table makes enough sense that you could fill out with your estimates.
If that is possible, it will be easy for me to compare rate and operation models.