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Janice Beecher and Jason Kalmbach Institute of Public Utilities Michigan State University beecher@msu.edu ipu.msu.edu Please do not distribute by electronic or other means or cite without permission. 2010 Great Lakes Water Rate Survey. MICHIGAN STATE UNIVERSITY.
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Janice Beecher and Jason Kalmbach • Institute of Public UtilitiesMichigan State University • beecher@msu.edu ipu.msu.edu • Please do not distribute by electronic or other means • or cite without permission. 2010 Great Lakes Water Rate Survey MICHIGAN STATE UNIVERSITY
2010 Great Lakes Water Rate Survey • Top ten water systems by service population from eight Midwestern states, by service population size as reported in EPA Consumer Confidence Reports • Illinois, Indiana, Michigan*, Minnesota*, New York, Ohio, Pennsylvania, and Wisconsin (*no economic regulatory authority) • Data gathered from websites & personal communications. • Nine water providers no rate information available directly on the website
Public fire-protection in fixed charges: average by meter size
Public fire-protection in fixed charges: range by meter size
Fixed charges and variable unit rates for 100 ccf by usage level
Water utility cost-trend analysis • Data from the Wisconsin Public Service Commission • Period: 2000-2009 • Benchmarking analysis • Annual financial reports • Class AB water utilities • N ranges from 72 to 94 • Informative but not generalizable to other water systems
Note: rate disparity between private and public systems (Beecher) • Income, property, and other taxes and fees (e.g., franchise) • Profits (equity returns to “owners” are less for public) • Financing (including SRF for cities) • Scale and density economies (favor cities) • Locational cost differentials (varies) • Contributions and system development fees (cities) • Costing practices (depreciation v. replacement expense) • Hidden subsidies (but also transfers) • Rate practices (outside-city rates) • Cost avoidance and deferrals (sometimes) • Investment incentives (private) • Economic regulation (cost-based rates) Note: significant variations from system to system Some municipal utilities actually provide transfers