Rockbridge PSA, VA Rate Analysis Report 1 · rockbridgtr cotjnty pi-]blic servictr at]thority 150...

ROCKBRIDGtr COTJNTY PI-]BLIC SERVICtr AT]THORITY

150 SOUTH MAIN STREET, LEXINGTON, VIRGINIA PHONE: 540-463-4329 FAX: 540-463-3126

April 2L,20ll

Mr. Carl E. Brown, PresidentCarl Brown Consulti ng, LLC1014 Carousel Dr.Jefferson City, MO 65101

Dear Mr. Brown,

I want to thank you for the great work you did for us, assisting ahead of a significant financial

transition phase. Not only was your report complete and easy to understand, but your

presentation helped our board and county staffto understand rates, and the variables and

complexity involved in developing them. Our capital fee structure in particular will be revised,

to encourage commercial development.

Working with you was an easy and pleasurable experience for our management staff. I have no

doubt we will keep up our rate study analyses in the future, especially since your fees are very

competitive. I have told other utilities about your worlg and will continue to do so.

If you ever need a reference, please give me a call.

With best regards,_u -\- ) M4t 'n^'-

,,4laren S. AustinExecutive Director

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__________________________________________________________________________________ Carl Brown Consulting, LLC 1014 Carousel Drive Jefferson City Missouri 65101 [email protected]

www.carlbrownconsulting.com www.gettinggreatrates.com (573) 619-3411 (573) 632-2810 fax

Proposal for Water and Sewer Rate Studies

Rockbridge County Public Service Authority,

Lexington, Virginia

Purpose and Need

This proposal describes the need, responsibilities, timing, investment and other issues for rate studies (later referred to as “studies” or “analyses”) of the water and sewer systems. These studies will be performed by Carl Brown Consulting, LLC (later referred to as “I”) for the Rockbridge County Public Service Authority, Lexington, Virginia (later referred to as “you”). To adequately fund current operation of your systems and services, build and maintain reserves, fund capital improvements and establish rates that are fair to all ratepayers, you need to analyze your rates and fees, set them appropriately and periodically reset them. The services proposed are intended to support you as you satisfy those needs.

Firm Location, Revenues, Qualifications and References

Firm revenues, qualifications and references are detailed in the document, “Qualifications and References for Carl Brown Consulting,” attached.

Carl Brown Consulting is based in Jefferson City, Missouri. We operate nation-wide. Our work focuses almost exclusively on rate analysis and rate setting. Carl Brown, President will conduct these analyses in their entirety. He has been doing rate analysis work since 1993. For most of that time he has also been teaching practitioners all over the U.S. on rate analysis and rate setting, writing a rate setting book and designing rate analysis software.

You may expect your analysis results package to look much like the attached rate study report package.

For conflict of interest purposes, Carl Brown Consulting has never had any ties to the Rockbridge County Public Service Authority beyond conducting a rate setting workshop which staff and a board member attended.

Form of Agreement

This proposal and your acceptance (probably by e-mail message) of one or more service packages is all the agreement I need. If you wish to prepare a formal contract you may do so but it is not necessary and that will take extra time.

My business model is a throwback – I operate on handshakes and the modern-day electronic equivalents. Basically, if I were to walk away from your project (I have yet to do that) you would owe me nothing. If you walk away from the project for any or no reason you would owe me nothing. This arrangement may seem to place me in jeopardy but it has worked very well because my service is based upon my satisfying my clients’ real needs. It is not based upon satisfying stipulations in a contract that may or may not satisfy their real needs.

Carl Brown Consulting, LLC

Creating Informed Decisions

Rockbridge County Public Service Authority, Lexington, VA Proposal, 12/14/2010, Page 2 of 5



Guarantee

In the unlikely event you feel I am not fulfilling the commitments in this proposal, simply tell me what you feel the problem is. I will do my best to make it right by you. If I still am not able to satisfy you, notify me by mail or e-mail. I will cease the services in question at that point, you will owe me nothing for those services and I will refund any payments you may have already made for those services. This has been my guarantee policy from the day the company was formed. No client has invoked this guarantee to date and I don’t plan to have you be the first.

Scope of Services That you may Select or Decline, at Your Option

The following service packages are intended to satisfy your rate study and rate setting needs.

Service package 1 is analysis of your water system’s usage and other fee adjustment needs. Importantly, this will include analysis of your capital fees and fees charged to customers in the Long Hollow area.

Service package 2 is the same as service package 1 except it is for your sewer system.

Service package 3 is for on-site visits1. Each visit will be one instance of this service package.

You may add or drop service packages at any time.

Use of Electronic Technology

I do almost all analysis work electronically. I strongly prefer, whenever possible, to receive all data and information electronically, generally transferring it by e-mail attachment. I prefer to receive volume usage, income and expense and other numerical data in a spreadsheet format and textual material in a word processor format. When I return material to you that you need to manipulate further, such as a revised ordinance, I will return it electronically in a format you can conveniently use. You will receive my analysis reports, the studies and my recommendations electronically as PDFs.

Approach and General Timeline

I intend to produce the majority of the user charge analysis output using my proprietary software called CBGreatRates©.

Rate analysis is an iterative, non-linear process. However, it can be broken down into several groupings of work as follows:

1. I will call your contact person, probably the day after being notified that I will be doing the analyses, to discuss data needs and get them started on initial data retrieval.

1 I generally recommend one on-site visit to present the completed studies and recommendations and to answer questions at a public board meeting, especially when I analyze more than one utility. You may choose as many on-site visits as you desire and change your mind as your needs become clearer.




2. Your staff will assemble and send to me usage data, rate charts, financial statements, capital improvement plans, equipment replacement and refurbishment plans and schedules, supply agreements and other information concerning your systems and services. I will guide your staff through the entire process. Where data is missing I will help you create estimates. Initial data retrieval will be accomplished early on but some data will be acquired throughout the project. My preference is to begin with the water system first and follow soon after with the sewer system. That is because sewer rate setting depends upon water usage data. I also like to use the model created for the water system as the template for the sewer system so both analyses will be in nearly the same format.

3. I will analyze this information and build your rate analysis models, coordinating periodically with your contact person. Jointly, we will arrive at a set of financial goals for your systems and services. Key model building will be complete about six weeks after starting. Some modeling will continue through nearly the end of the project. Once models have been built, unlimited “what-if” scenarios can be run to find the optimum mix of rate and fee levels and structures, funding options, reserve levels, etc. to suit your needs.

4. During the last half of the project I will examine as many scenarios of your possible future as it makes sense. I will share with you all that are potentially useful.

5. You will likely choose to consider adopting rates and funding levels from perhaps the two most promising scenarios for each service. Final output will include a cover letter, a report of my analysis and recommendations, which is largely a step by step action plan, and copies of the studies.

6. If you choose service package 3, I will present my final analysis results and recommendations to your board in person. While there I would hope to meet with staff to discuss how to effectuate needed changes to billing, equipment replacement scheduling, etc. If there are no issues that require in-person discussion I will be glad to participate in a board meeting to discuss the rates and fees I recommend by speaker phone at no additional cost.

7. As you draft proposed amendments to your ordinances and budgets to effectuate the rate, fee and other changes, at your request I will review those changes to assure that they accomplish what you intend to accomplish.

8. The board will consider and pass ordinance amendments to effectuate new rates, fees, budget revisions and other changes. Note: Boards often like to “take it slow” at this point. If necessary I will point out the revenues that will be lost each day the board postpones adjusting rates in order to encourage the board to move forward promptly.

9. As needed during later weeks and even years I will check in with you to see that you are on track and doing well and give you guidance if needed.

Expected Results

With the completion of the studies:

1. You will be able to successfully settle upon desired financial performance levels for your systems and services.




2. You will arrive at new user charge rates and fees that will adequately fund the systems and services for a substantial period of time. The studies will project your rates, fees, operating costs, capital improvements and all other important costs and revenues, plus important financial performance indicators 10 years into the future. Equipment replacement and refurbishment plans will be projected 20 years into the future.

3. You will be able to set rates, fees and other charges that are fair to your ratepayers.

4. You will be able to inform and promote to your board and to your ratepayers and property owners the need to adjust rates and fees now and to keep them current.

5. You will be able to acquire needed funding for capital improvement and equipment replacement projects depicted in the analyses and/or fund improvements from system revenues and reserves.

6. Being well funded you will successfully comply with your permit to dispense water, NPDES permit and other requirements from the regulatory agencies.

Work Coordination

I will communicate primarily with your designated contact person and with others, as you see fit, to do the analysis work.

Timing

My part of this project will probably consume about six weeks and much of that will occur at the same time that you are gathering data for the analyses or making decisions. Your part of this project will take longer. If we initiate the project quickly, you gather data quickly and it takes you two months to consider and adopt new rates, we can complete this project by early May, 2011.

Investment

These are your complete investments for my services, materials and travel costs, based upon the service descriptions above:

Service package 1, water user charge analysis – $4,512

Service package 2, sewer user charge analysis – $3,552

Service package 3, on-site visits – $1,858 each

If you choose service packages 1, 2 and one visit from package 3, the most likely group of services for you to choose, the total investment will be $9,922. Once the project gets started you may add or drop service packages as your needs become clearer.




Action item: If you accept this proposal call me to tell me what services you desire, or give me the same information in writing by e-mail message.

Proposal Acceptance

This proposal is effective through December 31, 2011 if you choose at least service package 1 or 2 by January 31, 2011. If my part of the project has not been completed by December 31, 2011, all fees for service packages not yet completed will escalate by 25 percent. (Aside from lagging performance on your part there is no reason this project will not be completed in a few months. I escalate fees only for this reason. If the analysis is drawn out for a full year I will end up having to gather updated data and reanalyzing, increasing my work markedly. More importantly, if you need to increase rates you would lose substantial revenue during such a long time lag. I don’t want these things to happen for me or for you so the escalation is intended to get and keep you focused on project completion.) Once you tell me what service packages you desire and you provide data to work with, I will immediately start to produce the analyses.

Payment

I will first invoice you for the total project amount upon your acceptance of this proposal. If you pay this initial invoice within 30 days of the invoice date you may deduct five percent from the invoice amount. Otherwise, I will re-invoice you for one-half of the project dollar amount after 90 days from proposal acceptance and the balance when I submit the final report set. You shall promptly pay the full amounts of those invoices. If you request and pay for services but later cancel those services, I will refund those fees to you. If I cancel any services in this proposal (I have yet to do such a thing), you will owe me no fees for those services and I will refund any fees you have already paid for those services.

In Closing

I am looking forward to the opportunity to conduct your rate studies so you can get your rates and finances set on a good course.

Best regards, Carl Brown Consulting, LLC

Carl E. Brown President



February 23, 2011 The Honorable Torben H. Pedersen, Chairman Rockbridge County Public Services Authority 150 South Main Street Lexington, VA 24450 Subject: User Charge Analysis Results Dear Mr. Pedersen: Enclosed please find the results of the water and sewer utility user charge analyses I recently completed for the Authority. Before turning to the analyses, I want to tell you this. Karen Austin and Melissa Alexander were both so good to work with. I was amazed at how well they understood the management and financial condition and needs of the systems. They do a fantastic job of monitoring the financial performance of the systems and producing some of the best guidance and decision-making materials I have ever seen regardless of system size. There was no piece of data or information that I needed that they couldn’t find or produce in minutes. I have worked with very capable system managers before but not to this degree. I don’t think any of my 160-plus client systems have had managers who had a better grasp of their systems’ finances. On top of that, both were always a joy to deal with. The Authority is well-served by having such staff and that made for a very enjoyable assignment for me, as well. Turning to my findings, the report will cover the details but generally, I was pleasantly surprised to find that the utilities’ rates are generating very close to the correct amount of revenues. I credit the guidance of Karen and Melissa, and good board decisions for that. Most of my clients must initially raise their rates by 20 to 45 percent and adjust their rate structures markedly, as well. In your case, you need rate restructuring but not that much extra revenue. The report is long, detailed and technical. You, the board and others should read through it but do not obsess over the details. Karen and Melissa can certainly handle the details with ease. If you have any questions, I suggest you first talk with Karen or Melissa because it is likely they will know the answers. If you still need help, please feel free to give me a call. It will be much easier for me to talk you through issues than it would be for you to study the charts to find the answers on your own.

Carl Brown Consulting, LLC

Creating Informed Decisions

Rockbridge County, VA Public Services Authority Rate Analysis Letter, 2/23/2011, Page 2 of 2



Before or even long after you adjust rates I want you and your staff to feel free to just give me a call anytime you have a question about the analyses, my recommendations or even things that may not be related to the analyses at all. A year from now you may need to call me, and that is just fine. If I can help you simply on the phone or by e-mail, and I usually can, I will do so. There will be no extra charge because that is just part of my service to get your rates set where they need to be. If the issue of concern requires substantial analysis we can then talk about if and how you would like me or someone else to help you. Whether I help you with the issue or I find someone else who is more appropriate to help you, I want to make sure you get and keep strong and fairly structured rates. I note that you will need to make several additional capital improvements, some of which will require loan and/or grant funding. You need to handle such issues to the Authority’s best advantage so when they arise, do feel free to call on me and I will help if I can. Finally, I am sure you know of other cities, districts and service authorities that need rate setting assistance. I am especially thinking about your water and sewer treatment providers because you have a vested interest in they’re getting their rates to you set correctly. There are many others that need such help, too. I hope you will tell these folks about me. I get almost all of my business by referrals from past clients and I hope to be able to trace several future clients back to my work with the Rockbridge PSA. Best regards, Carl Brown Consulting, LLC

Carl E. Brown President Enclosures



Water and Sewer Rate and Fee Analysis Report

Rockbridge County Public Services Authority

Lexington, Virginia

Prepared February 23, 2011

Carl Brown, President Carl Brown Consulting, LLC

Rockbridge County, VA Public Services Authority Rate Analysis Report, 2/23/2011, Page 2 of 12



Table of Contents Legal Disclaimer ............................................................................................................................. 2 Purpose ........................................................................................................................................... 2 Summary......................................................................................................................................... 2 Action Items ................................................................................................................................... 4 Discussion of Significant Issues ..................................................................................................... 4

Rate Adjustment Scenarios ........................................................................................................ 4 Decision Criteria ......................................................................................................................... 5 Availability and Potential Demand Charges .............................................................................. 6 Rate Affordability ........................................................................................................................ 7 Growth Rate and Hook-up Fees ................................................................................................. 8 Depreciation and Capital Improvements ................................................................................... 8 Equipment Replacement ............................................................................................................ 9

Basic and Policy Action Items ........................................................................................................ 9 Principles ....................................................................................................................................... 11 General Background ...................................................................................................................... 11 Closing .......................................................................................................................................... 12 Analysis Models ........................................................................................................... Attachments

Legal Disclaimer

It is imperative that all readers understand that this report and the accompanying analysis models are not legal recommendations. For legal issues consult your attorney.

Purpose

This report is intended to help the staff of the Rockbridge County Public Services Authority (simply called the “Authority” throughout the report) prepare proposed rate and fee revisions and to help the board to better understand the Authority’s situation and what should be done about it.

This report is part of a package that includes the following:

A cover letter,

This narrative report that details the findings and recommendations, and

The analysis models themselves which depict what will happen if you adjust rates and fees in the ways described in each model.

Unlike many reports, this one starts with the more specific items. Therefore, after a summary the report covers actions you should take to make the recommended rate adjustments. It then covers progressively more general items and issues.

Summary

Analysis determined that your water system has total reserves that are strong right now and they are generating revenues that are adequate for short- term needs. While those reserves would dwindle if rates were not incrementally increased in the future, they would not drop to zero for several years. Because new debt service will start in the next few years, total reserves




will be drawn down slightly even if rates are adjusted as proposed, but reserves will recover in the last half of the 10-year modeling period. The sewer system is in a similar situation. Therefore, rate adequacy is only a minor issue at this time. I credit that to the Authority’s decision recently to increase rates in anticipation of coming needs.

The analyses and this report will cover rate adequacy but they will focus more on rate structure appropriateness and fairness. To that end, my analyses determined that several changes to the rate and fee structures would serve the Authority well, including:

1. Adjust user rates so the minimum charge comes closer to capturing all fixed costs. Right now the minimum charges are too low, especially for the sewer system. This change will allow for relatively lower unit charges.

2. Initiate potential demand-based surcharges that will capture a substantial portion of the costs the systems incur to develop high-flow capacity. These surcharges would be based upon water meter size and apply to water and sewer. Water meter size is generally the limiting factor for high water flow. It is a good proxy for high sewer flow, as well.

3. Reduce availability fee revenues by 40 percent overall. In the future you may even want to reduce availability fees even more but I recommend you at least reduce them at this time to make the service area more competitive with nearby areas for economic development.

4. Initiate “Extra Service Unit” surcharges as explained later in the report.

This report includes two analysis models for each of the systems. These analyses are built on the same basic model so once you become familiar with one, you will understand the other. In addition, rates and fees for both utilities have been built using the same basic structure so there is a high level of consistency between the two.

The models were built to match the systems’ actual financial statements as much as possible. However, the intent of the rate modeling is to see to it that the resulting rates are adequate to pay all system expenses for the next 10 years, maintain responsible reserves and collect fees from customers on a fair basis. For modeling purposes, it does not matter whether funds are held in the general system account, a debt service sinking fund, debt coverage reserve fund, etc. Therefore, the models account for funds in a more simplified way than the accounting records of the systems. When it comes to segregating funds, staff knows best how to do that so the models do little in this regard and leave the segregating up to staff.

Some fund balances shown in the models are negative during some years. However, the “Total Assets Excluding Hard Assets” amount at the bottom of Chart 5 of each model is the important overall balance to track. As to system accounting, if a segregated fund runs precariously low staff will recommend transfers to prevent problems.

The analysis models should not be considered by anyone as a dictum on where rates and fees must be set – that is the prerogative of the board. However, the models do provide guidance that will help you to, in an informed way, set rates and fees successfully. They also give indications of how the modeled rates and fees will affect the various users.

As you set and later reset your rates I suggest you follow the guidance I give in my book, “How to Get Great Rates.” I gave a copy to Karen Austin. I suggest you also use the “Replacement Scheduler©” spreadsheet, at no charge, from http://www.gettinggreatrates.com/ggrn/store/products.asp?cat=13 and use it for future equipment replacement scheduling.




Action Items (Use the following as a checklist of rate setting “to-do” tasks.) The following actions are required to achieve the results predicted by the analyses, also called “models” and “scenarios.”

1. Adjust all rates and fees as described here on or near July 1, 2011.

2. Set the minimum charge for all customers as shown in Chart 1 of each model. These minimum charges include a surcharge for potential demand capacity that is further detailed in Chart 2C.

3. Continue billing on a bi-monthly cycle.

4. Continue including no usage allowance with the minimum charge, except in the case of Long Hollow where you should continue the 4,000 gallon usage allowance.

5. Set all unit charge rates as shown in Chart 1 of each model. Where there is a gap in the volumes displayed in the chart, keep the rate the same as the rate for the volumes above and below it. (Some volume classes have been hidden just to make the tables less bulky.)

6. Set an extra service unit surcharge as shown at the bottom of Chart 1.

7. Assuming financial performance was well predicted by the scenarios, effective on the one-year anniversary of the initial rate adjustments, and every year thereafter until a new analysis determines otherwise, raise all rates and fees by four percent for each system. This rate of increase is shown near the top of Chart 2A of each scenario.

Note: If you copy only a handful of charts as handouts for the public attending your rate setting meeting, charts 1, and 14 are the most useful charts for them to view.

Discussion of Significant Issues

Fees for Septage

Several septage haulers contribute waste. They are charged a minimum charge during any billing period during which they haul at least one load. They also pay a unit charge for the volume hauled. During months when they contribute no volume they pay nothing. Waste that originates inside the County is assessed one unit charge rate. Outside-of-County waste pays a higher rate.

The unit charge rates that septage haulers pay are directly related to the fees charged by the treatment plant. Therefore, the unit charges will change when, and in direct relation to changes to rates charged by the treatment provider. However, because the minimum charge is tied to the Authority’s minimum charge, that fee should change along with everyone else’s minimum charge rates.

Note that all of the charts in the analysis model show the minimum charge for septage as a small amount compared to the current rate you are familiar with. That is because the amount in the model is 1/6th of the current and proposed minimum charge amounts. It was necessary to show this rate in this way to remain consistent with the calculation methodology used for all other rates because the methodology assumes that each user pays at least the minimum charge every billing period – bi-monthly. If you retain the current minimum charge policy, simply




multiply the minimum charge shown in the model by six. Otherwise, bill septage haulers this amount every billing period.

Rate Adjustment Scenarios

In this report there is one full scenario for the water system. That is called “Rockbridge County PSA, Water Rates Scenario 1,” just called “…Water Rates Scenario 1.” I ran another scenario for this system, “…Water Rates Scenario 2,” which depicts rates needed if the extra service unit surcharges are not adopted. However, because everything else about …Water Rates Scenario 2 is essentially the same as …Water Rates Scenario 1, I present only Chart 1, the proposed rates, from …Water Rates Scenario 2. The rates in …Water Rates Scenario 2 would result in rates that are approximately 1.5 percent higher than those in …Water Rates Scenario 1.

Likewise, there is one full scenario for the sewer system. That is called “Rockbridge County PSA, Sewer Rates Scenario 1,” just called “…Sewer Rates Scenario 1” in this report. And, I ran another scenario for this system, “…Sewer Rates Scenario 2,” which depicts rates needed if those extra service unit surcharges are not adopted. I present only Chart 1, the proposed rates, from …Sewer Rates Scenario 2, as well. Like the water rates, these rates would also be about 1.5 percent higher if the extra service unit surcharges are not adopted.

Note: I modeled funding the “N Lee High Pressure Zone Transfer Project” as a loan funded project and as an equipment replacement and refurbishment item from equipment replacement reserves. There would be almost no financial or rate difference between the two funding methods; therefore, only the replacement reserves funding method is presented here. The bottom line on the options for funding the project is this. When it comes time to do this project, the willingness of the board and staff to deal with the “hassle factor” and cost of getting a loan versus using reserves will be the determining factor for how you fund this project. You should proceed to plan and build the project and decide which way to fund it when the time gets closer.

Decision Criteria

Several key criteria impact your situation and how you should set future rates. These include:

The water and sewer rates were modeled so that the water system will have $100,000 more in inflation-adjusted reserves excluding hard asset values and repair and replacement reserves in 10 years than it has now. The sewer system will have $150,000 more. In other words, you will have that much more purchasing power in 10 years for things other than repair and replacement. And the repair and replacement funds will maintain their own strong balances, as well.

The costs for purchased water and contract wastewater treatment services are far and away the largest single expense for each system. These costs will increase in the future and, therefore, markedly increase your rate revenue needs.

For water, two substantial improvement projects will be completed soon. These will increase debt service approximately five-fold, eventually making this expense nearly as great as purchased water. This will also markedly increase your rate revenue needs. The County is currently paying a large portion of existing water debt service. It is assumed this will continue. Debt service for the sewer system is already substantial, though most of it is currently being paid by the County. The models depict reducing the County’s funding assistance to zero over the 10-year modeling period. After that the system will start paying the County back.




The Authority now has a rate and fee structure that is already sound and in the same basic format as what I propose. The analysis models necessarily compare various possible rate and fee structures with the current rates and fees (often called the “do-nothing” or “do nothing different” scenario) to give readers a basic understanding of what would happen to them under the proposed rates as compared to what they were paying during the test year. However, a more useful base for comparison is the current plan for future rate increases. Two such comparisons are shown in charts 8B and 9B.

With only a few special exceptions, customers pay rates that include a minimum charge and a uniform unit charge for all volume of service used based upon water meter readings. This is a simple, straightforward structure and I recommend keeping it. However, my analyses showed that the current minimum charges are not high enough to capture all fixed costs of the systems. That is generally considered to be a major purpose of minimum charges. I recommend raising the minimum charges over time so these charges will capture a higher percentage of the fixed and high-flow capacity costs. The rates I recommend will start this process.

Water user rates for Long Hollow were set in the past on a basis that cannot be reproduced using the proposed rate adjustment methodology. Therefore, these rates are proposed to be adjusted as follows: The minimum charge will be set by multiplying the usage allowance of 4,000 gallons (four units) times the unit charge that Long Hollow users will pay, plus the minimum charge that all other residential users will pay. The Long Hollow unit charge will be increased (decreased) from the current level by the same dollar amount that other residential users’ unit charge rate will be increased (decreased).

The overall rate increase percentage shown at the top of Chart 2A of each analysis compares the proposed rates with those in effect during the test year.

Availability and Potential Demand Charges

The Authority’s current rate structure includes availability fees that charge customers for the capacity the systems must build to be able to serve them. In this way availability fees recoup capacity costs from new users on the front end when they become new users. I reviewed the Authority’s methods and policies and find them to be sound. It would be good if more systems had such advanced policies. However, not all systems in or near Rockbridge County do. This places the Authority’s service area in a weaker competitive position to attract development. I propose a solution for this problem, called a potential demand surcharge.

Like availability fees, potential demand surcharges recoup capacity costs from users. But they do it over time, based upon meter size, rather than on the front end. This methodology will increase the bi-monthly minimum charge of each user over what it otherwise would be and make the Authority’s service area more competitive with nearby communities to attract development.

To be clear, I do not propose eliminating availability fees. Rather, I propose reducing them so that the total revenue they generate will be reduced by 40 percent as compared to the availability fees collected during the test year. Use whatever combination of cuts to the availability fees the Authority sees fit to reduce these revenues by this overall percentage.

The potential demand fees will generate enough revenue to make up this 40 percent revenue reduction, plus a bit more at current availability fee revenue rates. It is hard to pin down the revenue change any better than that because availability fees are tied to new development which




Affordability Index: The monthly charge for (typically) 5,000 gallons of residential service divided by the median monthly household income for the area served by the system. An index of 1.0, meaning a household pays one percent of its income to pay its bill for 5,000 gallons of service, is generally considered affordable. Affordability index is a primary factor in determining grant and loan eligibility and grant amount.

can vary drastically, as we have all seen lately. However, potential demand fees are very dependable because they are based upon the existing customer base.

While high potential demand costs are not and cannot be known absolutely, they can be reasonably estimated. These costs can then be assessed to the various meter sizes to equate potential demand costs with the capacity to exert demand. Quite simply, the larger the meter the greater the potential demand a user can exert on the system.

Referring to Chart 2C of each model, note that at the bottom of the charts the high-flow capacity costs are laid out. The percentage of the total system capital costs that are attributable to high-flow customers should be 25 percent or more. In other words, at least 25 percent of the total cost to build the system was to enable high peak flow, generally for the larger users as represented by meter size.

However, the percentage in this chart was kept at a lower level simply to enable the systems to keep the total of the availability fees and the potential demand surcharges close to the level of the current availability fee revenues.

Extra Service Unit Surcharges

The scenarios assume that the Authority will initiate a system of surcharges for those customers that serve sub-users. Sub-users include mobile homes in mobile home parks where the Authority only bills the park owner/operator, businesses within a strip mall where only the mall owner/operator is billed, apartments in an apartment complex where only the complex owner/operator is billed and similar situations. By way of example, all other things being equal, a 1,000-unit apartment complex will cause more fixed costs for the utility than a 10-unit complex. That cost difference is what the extra service unit surcharges target. These costs are calculated in Chart 18B of each scenario.

Such costs, and the surcharges, are similar to potential demand surcharges with this difference. Potential demand surcharges recapture primarily capital costs to build system capacity and are related to the capacity to exert demand on the system. Extra service unit surcharges recapture estimated fixed costs across the cost spectrum.

Extra service unit surcharges will generate about 1.5 percent of total rate revenues; not a significant percentage. More importantly, they help to make the resulting rates fairer in structure.

If the Authority prefers to not adopt extra service unit surcharges, it should adopt water and sewer rates as shown in Chart 1 of …Scenario 2 for each system. These rates are marginally higher to make up for the revenue shortfall created from not charging extra service unit surcharges.

Rate Affordability

The affordability index of your current rates and my proposed rates are shown numerically in Chart 5 and graphically in Chart 9 of each analysis model. (Your rates are paid bi-monthly so those rates were converted to a monthly basis to make this comparison.) The initial rate increases push the affordability index up, meaning rates to the 5,000 gallon per month residential household become less affordable. The affordability index will then rise very




gradually over the next 10 years as rates increase incrementally to cover inflation, new debt service and other new or increased costs. All of this means that rates will become slightly less affordable with time if the systems’ costs rise as rapidly as projected and household incomes do not rise faster than the Census Bureau’s projections indicate.

In my experience, on an affordability basis the proposed rates are about normal for systems that are funding themselves sustainably or close to it. Systems with lower affordability indices usually have wealthier customers or more likely, their rates are not sustainable. That is regrettably very common right now but it will change, system by system, because there is no good alternative to being sustainable.

Growth Rate and Hook-up Fees

Connections grew modestly during the test year (the heart of the building recession). That bodes well for Rockbridge County because most of the Country saw no growth and many areas actually saw declines in users. The number of connections and the growth in connections is shown at the top of Chart 2A of each scenario. In the future the Authority should resume growth at nearly its previous rate but to be conservative I kept the growth rate slightly lower. The growth rate will affect both costs and revenues going forward, especially user fees, hook-up fees and availability/potential demand fees. The models take these changes into account.

Depreciation and Capital Improvements

Depreciation is a real event. Built facilities wear out with use and age with time, reducing and eventually eliminating their value and function. However, that wear out and aging process does not occur in a straight line as most depreciation schedules depict. Facilities usually function well for the first 75 percent or more of their useful lives and then they start a rapid decline. In addition, depreciation is “backwards looking” in that it considers the value of the system when it was initially built rather than considering the future cost to build a new system that would serve users as they desire in the future plus satisfy additional functions required by tighter environmental and health standards and customer desires.

Water utilities are made up of core components such as wells, treatment plants, towers and lines. These components wear and age slowly. Their useful lives define the maximum useful life of the utility as a whole.

Water utilities are also made up of secondary components that age and especially wear out with use more rapidly. These include pumps, motors and other mechanical parts that move. All of these parts are replaceable or can be refurbished to extend the useful life of the system as a whole.

Depreciation financially models the aging and breakdown process. It is a useful concept and it is even required to adhere to generally accepted accounting principles (GAAP). However, almost never is depreciation actually funded by placing those funds into an account to be available to pay for a new system when it is needed. Thus, it has limited value for municipal system rate setting.

Core components are generally funded as capital improvements, paid for initially with loan and perhaps grant proceeds, with loans retired in subsequent years by debt payments. This process works well because it generally has users pay for facilities dedicated to them during the time they get benefit from them. Paying for such components over time also generally works well because rarely do such components unexpectedly break down and need immediate replacement.




The capital improvement program includes a running balance. At the end of each year you should endeavor to retain in your various CIP and debt service reserves balances that total at least the balance shown near the bottom of Chart 5 that is called, “CIP Reserves.”

Equipment Replacement

Secondary components wear out. That process is fairly predictable generally but it is not so predictable for individual equipment items. Pumps, motors, rolling stock and other moving parts can fail one to several years earlier than expected and require immediate replacement to keep the system functioning. Problems may result if the system does not have reserves to pay for replacements. For this reason it is prudent to schedule equipment replacements, refurbishments and the like and set aside funds ahead of time to pay for these expenses when they occur.

To make the utility financially sound you should dedicate the amount shown at the bottom of Chart 17 of the analysis model for replacement and refurbishment of the utility’s equipment. This will enable you to handle equipment replacements when they are needed without disrupting the utility’s general budget.

The replacement fund includes a running balance. At the end of each year you should endeavor to retain in this fund the balance shown on the right side of this chart.

It is important to note that the replacement annuity was based upon staff estimates of replacement needs going forward. I recommend you download the spreadsheet called “ReplacementScheduler©” and update the schedule so it can recalculate the annuity amount each year.

Basic and Policy Action Items Use the following as a checklist of “to-do” tasks. Many if not all of these things you are already doing but they bear repeating.

1. If your current late payment penalties are not at least $10.00 or 10 percent of the outstanding balance each month, whichever is greater, set them at these rates to give late payers more incentive to pay on time.

2. Before you officially propose or adopt new rate language, you may mail or e-mail the rate charts, ordinances or agreements to me and, as a part of this project, I will verify that your language will effectuate the intended rate and policy adjustments.

3. Determine how long, on average, it takes to perform the various services you provide in the field, such as after-hours service, meter disconnects and reconnects, special meter readings, etc. Be sure to include all the time you actually pay staff for performing these services. Then determine how much it costs the Authority per hour, on average, to have staff perform these services. This includes benefits, taxes, use of Authority vehicles, tools and minor equipment, etc. It should also include a fair amount to cover the time that office staff devotes to working on these services to track them, bill for them, etc. This should be the hourly rate you will charge for these services. In addition, set a minimum that you will charge for showing up, whether the service takes an hour to perform or 10 minutes. In essence, set your fees in the same way plumbers and similar technicians do – a set fee for showing up, which buys the customer a set amount of time, and an hourly rate if the job takes longer than the show up charge will cover. While accounting for time and other investments in the various functions is important, do not make the process




burdensome. For many functions you likely can just estimate your time occasionally and charge fees based upon those estimates.

4. Staff performs services for developers and others. This may include review and approval of water system expansion plans and connection applications. For all such services you should determine their full costs and set fees and charges to fully recover those costs.

5. Retain required funds in interest bearing debt service and debt reserve accounts when required by your lender(s).

6. It makes sense to do equipment replacement and capital improvement planning comprehensively. However, the two types of expenses will usually be funded differently. Equipment replacement should generally be funded from operating revenues on a “saved ahead of time” basis. Capital improvements are usually paid for with grant and loan proceeds and then paid for over time after the improvements have been built. Therefore, you should plan for each type of expense using separate schedules as soon as practical. Use charts 3 and 17 as models for these tasks. As mentioned before, you can also download my equipment replacement schedule to make replacement scheduling easier.

7. Have me conduct a full rate analysis again when your actual financial performance and my projections diverge significantly, but not longer than five years from now to make sure your rates remain adequate for the system and fair to your ratepayers. In addition, before embarking on capital improvements and funding acquisition, have me study your options in depth so you can maximize your funding success and minimize your costs.

8. Start adopting management strategies that are included in what is most commonly called, “advanced asset management.” These strategies can yield better service and reduced costs for utilities, especially those looking to build new facilities or replace existing facilities soon. Visit my Web site at http://carlbrownconsulting.com/ for more information on asset management or call me to discuss how the Authority might move into asset management.

9. If you do not already do so, consider “paying” developers to install over-sized lines and other equipment and features when such installations would facilitate future development more economically. To illustrate:

You may have a developer who would needs to install a two inch water distribution line to serve the needs of their development. However, other properties in the area that would use that same line when developed later may require it to be four inches in diameter. In that case you and the initial developer would determine the additional cost of installing the four inch line and the Authority would reimburse the developer for that portion of the cost. (The incrementally higher cost of installing a larger line is small but the value of having that line in place and ready for use when needed is very large.) That reimbursement may be in the form of a discount on the developer’s connection fees.

Later, when other developments use the four inch line you would charge those developer(s) their proportionate share of the cost to make that line available for their use. In addition, you may, and I suggest that you do, charge an additional amount or percentage to serve as reimbursement for the Authority’s expenses to finance the upsizing and to cover risk. These costs are substantial. In that way, lines and other systems would be built in the most economical fashion possible. Plus, the Authority could recoup its investment in up-sized lines and facilities, and cover its risks of loss.




Be careful about how this cost sharing may affect your cash flow. I strongly suggest you set up a separate fund to which you will deposit connection and developer fees and from which you will pay for system upsizing. Manage this fund so it will fully cash flow itself and maintain a reserve over expected disbursements of at least 50 percent.

10. Continue to track your volume usage, incomes and expenses on a regular basis so the data and information you generate will continue to support future rate adjustments as well as they did this one.

11. As a reminder, check with your attorney for language and legality of all charges and issues discussed.

Principles I use several guiding principles when I help systems set their utility rates, fees and policies.

As you read this report and the analyses, keep in mind that my recommendations have been weighed against these principles:

1. Water, sewer and all other utilities are businesses, regardless of who owns them. Businesses must cash flow properly.

2. In addition to functioning in a business-like manner, a utility has a responsibility to its customers to nearly guarantee its long-term prosperity for their benefit. The customers expect the service to be there whenever they want to use it. Thus, a utility must err on the conservative side by maintaining strong reserves that will enable it to weather financial storms.

3. If a service costs the utility money, the utility should recover that cost from the most logical “person” if that makes good business and community administration sense. For example, generally “growth should pay for growth.” Developers should fairly pay for their consumption of utility capacity. Likewise, service users should pay for their use. Each user or class of users should pay their fair share of service costs.

4. If adjusting a rate, fee or policy will turn currently “good” customers into “bad” customers, consider the necessity of the change carefully before making it. For example, while it may be warranted, raising the minimum charge markedly to your residential customers may make it very difficult for fixed, low-income customers to pay their water bills. That may cause more of them to pay late or not pay at all. That may trigger the Authority’s processes of having the Authority’s attorney write threatening letters to those customers and eventually require shutoff of service. Thus, in the attempt to generate more net revenue by raising rates, net revenues may actually go down.

General Background I made assumptions and estimates where necessary for the analyses. Using sensitivity tests

and my experience in performing over 160 rate analyses, I am confident these assumptions are adequate for your rate setting purposes at this time.

Notable asumptions and issues include these:




The analyses use the test year of July 1, 2009 through June 30, 2010. This is the one-year period from which actual cost, revenue, usage and other data were gathered. The test year is the starting point for the analyses. Costs, revenues and all other data will change in future years based upon inflation, growth, the proposed rates and fees and many other things. Essentially the analyses seek “best fit” rates to satisfy many issues facing the system. Therefore, you cannot look at the analysis charts several years out and view financial predictions like they are accounting records. Future costs, revenues and other data, though they are based upon solid starting data and change rates, are predictions and estimates only.

I assumed that you will continue to bill on a bi-monthly basis.

I assumed that future operating costs will rise at varying inflation rates, as shown in Chart 2B. Some costs, like electricity for pumping, will rise due to inflation and due to additional use caused by customer growth.

Because the Authority has been growing strongly (except for the current slowdown period), the number of user connections and customers changes each year. For future years these averages increase based upon your estimated rate of growth for each year.

The working capital goal for your system is shown at the bottom of Chart 2B. To guard against serious financial upset, I recommend you maintain at least this reserve level to help you make it through unusual times without having to take drastic rate or operating cost-cutting measures.

Closing Your current rates are projected to keep the systems solvent for several years, but at

dropping reserve levels. Your planned future rate increases would make that financial picture better. However, if you will restructure and increase rates as modeled in the analyses I am confident your financial condition will remain very strong and allow you to make the improvements the systems will require over the next several years.

While your rate revenues do not need to rise much, your rates should be restructured to better equate rates paid with the types of costs incurred. Generally, the minimum charges need to be increased more than the unit charges. This is especially true for the sewer rates.

I recommend you make initial rate adjustments as soon as possible and follow up annually with across the board inflationary rate and fee increases. In several years, after several rounds of inflationary increases, it will then be time to reanalyze and restructure rates again to keep them as fair to the ratepayers as you reasonably can make them.

You now should do those things listed in the Action Items sections above.

Rockbridge County PSA, Water Rates Scenario 1

Rate Analysis Modeling Results

This model assumes initial rate adjustments as reflected in Chart 1. Annually thereafter rates will be increased as shown near the top of Chart 2A. The model compares the system's financial outlook under the proposed rates with the outlook if no adjustments are made to make it easy to understand the outcome of the proposed changes.

For most, the best way to read and understand what this model means is this. Scan the "Index of Charts and Pages" to see how the model is laid out. Scan the "Definitions" for any terms you are not already familiar with. Read and even ponder charts 1 and 6-14. These will show you how the proposed rate adjustments will affect ratepayers and the system. If you need more detail than that, review the entire model. Finally, rate setting involves much more than just rates so you need to read the accompanying narrative report to understand what you need to do and why.

Several tables in this model depict volume usage and user rates for the various customer classes. The model includes a continuum of volumes but many volume classes had no use. Most of these lines have been hidden simply to make the tables less bulky. However, all volume classes that had use or that are break points for rate blocks are shown. For volume classes that are not shown, rates will be the same as the previous rate that is shown.

February 24, 2011This rate analysis scenario was produced byCarl E. Brown, Carl Brown Consulting, LLC

1014 Carousel Drive, Jefferson City, Missouri 65101(573) 619-3411

[email protected]

CBGreatRates© Version 5.2

http://www.carlbrownconsulting.com/�

mailto:[email protected]�

Name What Each is or Does

Definitions The meaning of terms used in this report and in rate setting generally

Financial Highlights A summary of financial outcomes produced by the proposed rates

Chart 1 - Proposed Rate Chart User rates proposed in this model for each user class

Chart 2A - User Base and Operating Incomes

Basic user base and user rate statistics and operating revenues projected for next 10 years

Chart 2B - Operating Costs and Net Income

Operating costs projected for next 10 years, excluding debt service

Chart 2C - Potential Demand Minimum Charges Based on Meter Size

If applicable to this analysis, a calculation of surcharges to apply to minimum charges, based upon meter size or similar criteria, that will recoup part or all of the costs incurred to provide high-flow capacity.

Chart 3 - Capital Improvement Program Capital improvements and how they will be paid over next 10 years, including debt service

Chart 4A - Rate Adjustments and Incomes for Modeling Year

Current rates, proposed rates and the blended revenues they will produce during the year rates are adjusted

Chart 4B - Rate Statistics Effects of proposed rates on user classes and special users

Chart 5 - Indicators Financial results that proposed rates and projected operating and capital costs will

Chart 6 - Operating Ratio Graph of operating ratio for next 10 years

Chart 7 - Coverage Ratio Graph of coverage ratio for next 10 years

Chart 8 - 5,000 Gallon Residential User's Bill

Graph of bill for a 5,000 gallon per month residential user for next 10 years (used in grant and loan eligibility determinations)

Chart 9 - Affordability Index Graph of affordability index of residential user's bill for next 10 years (used in grant and loan eligibility determinations)

Chart 10 - Working Capital Graph of working capital for next 10 years

Chart 11 - Working Capital and CIP Reserves Discounted for Inflation

Graph of working capital and CIP (capital improvement program) reserves adjusted for inflation for next 10 years

Chart 12 - Current Position Graph of current position for next 10 years

Chart 13 - Residential Use and Revenues Graph of usage vs. revenues for next 10 years for single family residential users

Chart 13B - Residential Use and Revenues

Graph of usage vs. revenues for next 10 years for all users except single family residential

Chart 13C - Tap Fee Reserve Balance Balance of tap fees reserved for CIP for next 10 years, if applicable

Chart 14 - Old Rates, New Rates and Changes

Illustrates effects of proposed user rates on ratepayers (increases or decreases)

Chart 15 - Test Year Usage Volume of service used by customers during the test year

Chart 16A - Rates During Test Year The test year (current) user rate chart

Chart 16B - Reserves, AMHI Reserves available at the start of the test year and incomes received during the test year

Chart 17A - Equipment Replacement Details Chart

Detailed schedule of equipment replacements for next 20 years

Chart 17 - Replacement Schedule Calculation of the annual annuity (yearly savings amount) needed to pay for all equipment replacements as they come due

Chart 18 - All-in Test Year Costs and Rate Structure Calculations

Sumation of test year system costs and calculation of "proportional to use" cost recovery rates for fixed cost and variable cost (cost to produce)

Chart 18B - Test Year Extra Service Unit Costs

If applicable to this analysis, cost of providing service to units such as apartments and mobile homes when they are not billed separately.

Rockbridge County PSA, Water Rates Scenario 1Index of Charts and Other Results

DefinitionsCBGreatRates© Version 5.2

Affordability Index The monthly charge for (typically) 5,000 gallons of residential service divided by the median monthly household income for the area served by the system. An index of 1.0, meaning a household pays one percent of its income to pay its bill for 5,000 gallons of service, is generally considered affordable. Affordability index is a primary factor in determining grant and loan eligibility and grant amount.

Capacity Charge, also commonly called an ‘Impact Fee’ or ‘Availability Charge’

A charge that buys a new customer system capacity. This is a charge levied on a new customer that recovers all or part of the capital costs to build capacity to be able to serve that customer’s actual or potential demand. This charge may be a few thousand dollars for a residential customer to many thousands of dollars for a large industrial customer.

Capital Improvement Plan or Program (CIP)

A listing of anticipated capital improvements. These are the more expensive items such as water towers, treatment plants and lines, that generally require bond or grant funding. They do not include equipment replacement items.

Capital Improvement Reserves

Cash reserves dedicated to funding the CIP

Comprehensive Rate Analysis

A thorough examination of a system’s operating, capital improvement, equipment replacement and all other costs, revenues, current rates, number of users and their use of the system, growth rates and all other issues surrounding the system. This examination will determine how rates and fees should be set in the future to cash-flow the system properly, to build appropriate reserves and to be fair the ratepayers. It also will determine how policies should be adjusted to enable the system to operate well now, operate well in the medium-range future (about 10 years) and prepare for expected and expectable events such as capital improvements and equipment replacement.

Connection Charge A charge that buys a new customer connection to the system. This charge is levied on a new customer to recover all or part of the costs a system incurs in the course of connecting the new customer to the system. This may include labor costs for staff or others on-site; equipment sold by the system to the new customer for making the connection; equipment, tools and supplies used by system staff for making the connection; and the like. This charge may be a few hundred dollars for a residential customer to thousands of dollars for a large industrial customer.

Conservation (Inclining) Rates

Unit charges that go up as the volume used goes up

Cost to Produce There are several ways to define cost to produce. Each is acceptable for different purposes. Generally, cost to produce is the total of all variable costs required to get service to a utility’s customers during one year divided by the total units of service delivered during that year. In a proportional to use rate structure, this will be the variable cost. See "Cost Calculations" at the bottom of Chart 18.

Cost to Serve Rates Rates where fixed and variable costs generated by each user class are paid by that class with minimum and unit charges, respectively.

Coverage Ratio (CR) Incomes and reserves available to pay debt divided by the amount of the debt for that year. Most systems should have a CR of 1.25 or higher.

Current Position For a year, the sum of all incomes and undedicated reserves minus all current financial obligations for that year. Future obligations (next year’s loan payments) and depreciation are not included. Current position is a good measure of overall financial health.

Declining Rates Rates where unit charges go down as the volume used goes up

Flat Rates Rates where all users pay exactly the same fee regardless of the volume of service they use

Equivalent Dwelling Unit (EDU)

Based upon number of water using fixtures, average flow, potential flow or similar criteria, the service consumption rate of the average single family home is rated at one EDU. All other types of customers are then compared on this measuring basis and the EDUs are calculated. Generally the purpose of this exercise is to calculate fees that each EDU must pay.

Extra Service Unit A refinement of the EDU system used to asssess a surcharge for each living or business unit within a multiple unit facility; apartments in an apartment complex, shops in a strip mall or a motel rooms in a

Extra Service Unit Costs Incremental costs incurred, importantly including debt service, to provide service to extra service units. In systems with few extra service units or little debt service, these costs are usually negligible.

Incremental Rate Adjustments

Rate increases done, generally annually, following the initial rate adjustment. The goal of these rate increases is to keep the system’s income and reserve levels on track. Rate structure fairness is a small issue, if it is an issue at all. Such increases are usually small, in the two to five percent per year range.

Initial Rate Adjustments Rate adjustments done in follow up to the comprehensive rate analysis. Generally, the goal of such adjustments is to establish rates that put the system’s income and reserve levels on track with the system’s financial needs and do it with a structure that is fair to the ratepayers.

Inflow & Infiltration (I&I) In a sewer system, water that gets into the collection system by way of illicit connections (inflow) such as gutter downspouts and leaks in manholes and sewer lines (infiltration)

Infrastructure Hard assets, such as water towers, treatment plants and lines needed to provide service to customers connected to the system

Life-cycle Cost The total cost to design, build, operate, maintain and eventually dispose of an asset. One asset may cost less to build but be more expensive to operate and maintain, yielding a higher life-cycle cost.

Operating Costs Definitions vary. For rate setting purposes operating costs are costs incurred because a system is owned and operated. Such costs are generally recovered through user fees.

Operating Revenues Revenues generated by user fees

Operating Ratio (OR) Current incomes and undedicated reserves minus current expenses, not including debt. An OR of 1.0 is "break even." Most systems should have an OR of 1.25 or higher.

Payback Period Time required for the investment made to get this analysis to return that investment through increased user and other fees

Potential Demand The volume of service that a user could demand for a short period of time at full volume use. The potential demand limiting factor is usually the size of the customer's meter or service line.

Proportional to Use Rates Rates where the minimum charge recovers all fixed costs, the unit charge recovers all variable costs, the unit charge is the same for all volume sold, and there is no usage allowance in the minimum charge.

Replacement Schedule A timetable that describes equipment replacement and important repairs that are too infrequent and/or too expensive to cover as annual operating costs but not so expensive that they need to be covered as capital improvements.

Replacement Reserves Cash reserves used to fund the Replacement Schedule

Return on Investment The dollar amount or percentage of revenue gain enabled by this analysis

Tap Fee, also called a "Hook up Fee"

A charge that gives a new customer the right to connect to the system. This fee may include the costs of administering the connection program, such as staff time to ‘sign up’ new customers, get them into the system’s billing program, do an inspection of the service connection to assure that it meets the system’s standards and the like. This charge is usually minimal for a residential customer and maybe a few thousand dollars for a large industrial customer. Capacity and connection fees are commonly added to tap fees and the total fee is just called a 'tap' fee.

Test Year The one year period from which data was gathered to be the basis of the rate analysis

Usage Allowance The volume, if any, that is "given away" with the minimum charge. Most systems give away no volume. Those that give away an unlimited volume have what are called "flat rates."

User Fee, User Charge, User Rates

Fees assessed to customers for use of the system. Does not include tap, capacity or connection fees, late payment penalties or other types of charges.

Water Loss Measured by volume or percent, the part of a water system's net water production that does not get to customers. This loss also includes billable volume lost due to under-registering customer meters.

Working Capital or Net Income

The amount left in the operating fund after paying all costs due during that month, year or other time period. Working capital of $0 is "break even."

Working Capital Goal The desired percentage above "break even" for the operating fund. Small systems (a few hundred connections) generally should target 35 percent or greater. Larger systems can target less, down to a minimum of about 20 percent for systems with 5,000 or more connections but the goal for each system should be based upon the needs of that system.

Rockbridge County PSA, Water Rates Scenario 1Financial Highlights CBGreatRates© Version 5.2

6/30/10 6/30/11 6/30/15 6/30/20Rate revenues collected $929,511 $1,027,485 $1,455,741 $1,979,554Sum of incomes $1,066,665 $1,144,641 $1,671,443 $2,221,481Sum of operating costs $824,373 $994,125 $1,334,351 $1,607,623Net income gain or loss ( - ) $242,292 $150,516 $337,092 $613,858Capital improvement reserves $576,817 $408,147 $110,713 $641,234Replacement reserves $174,125 $169,115 $206,397 -$50,020Current position* $320,384 $470,899 $667,176 $803,812*All current incomes plus reserves minus all current obligations

Increase or decrease ( - ) in total assets, excluding hard assets, due to this analysis N.A. -$11,706 $1,068,773 $4,007,213

Return on Investment and Payback Period CalculationsReturn on investment due to this analysis, projected one and five years into the future N.A. -206% 18853%

Payback period, in days, made possible by this analysis 9

Return rate and payback period are based upon the following investments:

Fees to Carl Brown Consulting $5,169

Estimated value of city staff time and incidentals to assemble needed information $500

Total Investment $5,669

This analysis was produced using the program CBGreatRates, copyright 2010. You are encouraged to distribute this report so long as credit is ascribed to the author, Carl E. Brown of Carl Brown Consulting, LLC.

Results for Years Ending on

This analysis package examines a "proposed rates scenario" that depicts what will happen under the adjusted rates and other changes recommended for the system. The results of this scenario are compared to the results you can expect if you do not adjust rates at all during the 10 years following the test year.

In the following table you can see several key financial benchmarks made possible by the proposed rates. The first column below is the test year, the year from which historical data was used to build the model. The second is the year following the test year - the year during which initial rate adjustments (typically) go into effect. The last two columns are the fifth and tenth years following the test year.

With the exception of tables that depict test year data, all other tables and charts depict the financial performance made possible by the modeled rate changes. The easiest way to grasp the financial future of the system is to view the line graphs. Another table shows the bills your users are paying now compared to the bills they would pay under the proposed rates scenario.

Rockbridge County PSA, Water Rates Scenario 1Chart 1 - Proposed Rate Chart CBGreatRates© Version 5.2

Starting with bills on and after June 30, 2011 user rates will be as follows:

Class Bottom Use in Gallons

Class Top Use in Gallons

Minimum Charge per Billing Cycle

Usage Allowance in 1,000 Gallons

Unit Charge This Class per 1,000

Gallons0 999 $11.50 0.000 $0.00

1,000 1,999 $11.50 0.000 $0.00 90,000 9,999,999 $11.50 0.000 $0.00

0 999 $19.14 0.000 $4.32 1,000 1,999 $19.14 0.000 $4.32 2,000 2,999 $19.14 0.000 $4.32

90,000 9,999,999 $19.14 0.000 $4.320 999 $41.94 0.000 $4.32

1,000 1,999 $41.94 0.000 $4.32 90,000 9,999,999 $41.94 0.000 $4.32

0 999 $71.59 0.000 $4.32 1,000 1,999 $71.59 0.000 $4.32 2,000 2,999 $71.59 0.000 $4.32

90,000 9,999,999 $71.59 0.000 $4.320 999 $113.10 0.000 $4.32

1,000 1,999 $113.10 0.000 $4.32 2,000 2,999 $113.10 0.000 $4.32

90,000 9,999,999 $113.10 0.000 $4.320 999 $231.72 0.000 $4.32

1,000 1,999 $231.72 0.000 $4.32 2,000 2,999 $231.72 0.000 $4.32

90,000 9,999,999 $231.72 0.000 $4.320 999 $397.78 0.000 $4.32

1,000 1,999 $397.78 0.000 $4.32 2,000 2,999 $397.78 0.000 $4.32

90,000 9,999,999 $397.78 0.000 $4.320 999 $51.87 4.000 $8.18

1,000 1,999 $51.87 4.000 $8.18 2,000 2,999 $51.87 4.000 $8.18

90,000 9,999,999 $51.87 4.000 $8.180 999 $0.00 0.000 $0.00

1,000 1,999 $0.00 0.000 $0.00 90,000 9,999,999 $0.00 0.000 $0.00

Extra Service Units $5.56 0.000 $0.00Note: Rates for volume classes not shown are the same as adjacent rates. Fireline rates are a simple flat rate.

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Rockbridge County PSA, Water Rates Scenario 1 CBGreatRates© Version 5.2

Chart 2A - User Base and Operating Incomes This chart depicts incomes during the test year, this year and for the next 10 years.

Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting

7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

User BaseNA 2169 2187 2205 2227 2260 2306 2358 2411 2465 2520 2577

NA 18 18 22 33 45 52 53 54 55 57 58

NA 0.83% 0.83% 1.00% 1.50% 2.00% 2.25% 2.25% 2.25% 2.25% 2.25% 2.25%

NA NA 14.7% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%

NA NA $19.14 $19.91 $20.70 $21.53 $22.39 $23.29 $24.22 $25.19 $26.20 $27.24

NA NA $4.32 $4.50 $4.67 $4.86 $5.06 $5.26 $5.47 $5.69 $5.92 $6.15

Operating Incomes

Water & Fireline Sales NA $929,511 $1,027,485 $1,237,646 $1,300,023 $1,372,304 $1,455,741 $1,548,034 $1,646,180 $1,750,548 $1,861,532 $1,979,554

Late Charges, Penalties NA $13,228 $8,960 $10,793 $11,337 $11,967 $12,695 $13,499 $14,355 $15,265 $16,233 $17,262

Hookup Fee % Above $6,975 $7,033 $8,886 $14,001 $19,706 $23,517 $25,008 $26,593 $28,279 $30,072 $31,979

Interest NA $7,851 $1,602 $2,354 $2,817 $2,914 $3,233 $3,336 $3,458 $3,601 $3,719 $3,857

Availability Fees NA $90,060 $80,000 $66,194 $100,283 $135,717 $155,735 $159,239 $162,822 $166,485 $170,231 $174,061

Reconnection NA $6,243 $6,243 $6,243 $6,243 $6,243 $6,243 $6,243 $6,243 $6,243 $6,243 $6,243

Trip Charges NA $60 $60 $60 $60 $60 $60 $60 $60 $60 $60 $60

Inspection Charge NA $150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150

Account Charge NA $3,540 $3,540 $3,540 $3,540 $3,540 $3,540 $3,540 $3,540 $3,540 $3,540 $3,540

Misc & Bad Check Revenue NA $3,317 $3,837 $4,031 $4,255 $4,513 $4,800 $5,104 $5,427 $5,772 $6,137 $6,527

Bad Debt NA -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751 -$1,751

Lease-Glasgow Interconnection NA $7,482 $7,482 $7,482 $7,482 $7,482 $7,482 $7,482 $0 $0 $0 $0

Total Regular Income $1,066,665 $1,144,641 $1,345,627 $1,448,440 $1,562,845 $1,671,443 $1,769,944 $1,867,077 $1,978,192 $2,096,167 $2,221,481

(First year balances and incomes are actual, subsequent years are projected.)

Infla./De-flation (–)

Factor

Adjusted, Then Annually Readjusted Unit Charge/Billable Volume Unit for Uniform Rates Only

Adjusted, Then Annually Readjusted Minimum Charge/Billing Period for Uniform Rates Only

Average Users for the Year

Users Added/Lost During the Year

User Growth/Loss Rate

Rate Increases Initiated in Future Years


Chart 2B - Operating Costs and Net Income This chart depicts expenses during the test year, this year and for the next 10 years.

Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

(Note: Some future costs will experience inflation. Those costs that go up as use goes up are also increased by the growth rate in users and the percentage by which that cost is variable as reported in Chart 4.)

Administration Salaries, Benefits, etc. 5.0% $126,890 $135,899 $142,694 $149,829 $157,320 $165,186 $173,446 $182,118 $191,224 $200,785 $210,824

Operations Salaries, Benefits, etc. 5.0% $121,361 $129,978 $136,476 $143,300 $150,465 $157,989 $165,888 $174,182 $182,891 $192,036 $201,638

Licenses & Permits 2.0% $4,568 $4,659 $4,752 $4,847 $4,944 $5,043 $5,144 $5,247 $5,352 $5,459 $5,568

Maintenance of Wells 3.0% $739 $1,750 $1,803 $1,857 $1,912 $1,970 $2,029 $2,090 $2,152 $2,217 $2,283

Purchased Water 3.0% $418,027 $510,148 $513,126 $529,899 $628,938 $651,914 $675,729 $700,414 $726,001 $752,523 $780,013

O&M Water Pump Sta. Equip. 3.0% $2,256 $2,323 $2,393 $2,465 $2,539 $2,615 $2,693 $2,774 $2,857 $2,943 $3,031

Power for Pumping Water 5.0% $42,812 $58,200 $61,110 $64,166 $67,374 $70,742 $74,280 $77,994 $81,893 $85,988 $90,287

O&M of Water Buildings 3.0% $247 $255 $262 $270 $278 $287 $295 $304 $313 $323 $332

O&M W Treatment Equipment 3.0% $1,283 $750 $773 $796 $820 $844 $869 $896 $922 $950 $979

Water Treatment Supplies & Expenses 5.0% $2,704 $2,850 $2,993 $3,142 $3,299 $3,464 $3,637 $3,819 $4,010 $4,211 $4,421

Sampling/Analysis 3.0% $4,399 $5,936 $6,114 $6,298 $6,486 $6,681 $6,881 $7,088 $7,301 $7,520 $7,745

Maintenance of Water Tanks 3.0% $3,578 $2,000 $2,060 $2,122 $2,185 $2,251 $2,319 $2,388 $2,460 $2,534 $2,610

Maintenance of Mains & Accessories 3.0% $2,292 $4,875 $5,021 $5,172 $5,327 $5,487 $5,651 $5,821 $5,996 $6,176 $6,361

Water Services 3.0% $3,420 $10,000 $10,300 $10,609 $10,927 $11,255 $11,593 $11,941 $12,299 $12,668 $13,048

Maintenance of Large Meters 3.0% $1,696 $2,000 $2,060 $2,122 $2,185 $2,251 $2,319 $2,388 $2,460 $2,534 $2,610

Maintenance of Hydrants 3.0% $2,754 $4,500 $4,635 $4,774 $4,917 $5,065 $5,217 $5,373 $5,534 $5,700 $5,871

Bank Service Charge-W 3.0% $263 $54 $56 $57 $59 $61 $63 $64 $66 $68 $70

Uncollected Water Expenses 3.0% $3,145 $1,080 $1,112 $1,146 $1,180 $1,216 $1,252 $1,290 $1,328 $1,368 $1,409

Office Supplies & Software 3.0% $3,623 $7,830 $8,065 $8,307 $8,556 $8,813 $9,077 $9,349 $9,630 $9,919 $10,216

Financial, Legal, Payroll Contract 5.0% $5,065 $11,668 $12,252 $12,864 $13,508 $14,183 $14,892 $15,637 $16,419 $17,240 $18,102

Insurance Premiums-W 5.0% $8,620 $7,430 $7,802 $8,192 $8,602 $9,032 $9,483 $9,957 $10,455 $10,978 $11,527

Transportation (Vehicles)-W 3.0% $6,593 $9,653 $9,943 $10,241 $10,548 $10,865 $11,191 $11,526 $11,872 $12,228 $12,595

Board Members Comp/Travel-W 3.0% $1,205 $1,617 $1,665 $1,715 $1,767 $1,820 $1,874 $1,930 $1,988 $2,048 $2,110

Uniform Rental, Dues, Subscrip, Training, Misc 5.0% $2,973 $8,117 $8,523 $8,949 $9,397 $9,866 $10,360 $10,878 $11,422 $11,993 $12,592

O&M of General Equip/Property-W 3.0% $5,963 $8,181 $8,426 $8,679 $8,940 $9,208 $9,484 $9,769 $10,062 $10,363 $10,674

Telephone, Pager 5.0% $2,229 $2,445 $2,567 $2,696 $2,830 $2,972 $3,120 $3,276 $3,440 $3,612 $3,793

Postage-W 5.0% $3,412 $3,220 $3,381 $3,550 $3,728 $3,914 $4,110 $4,315 $4,531 $4,757 $4,995

Outside Services-Mowing-W 3.0% $8,294 $11,250 $11,588 $11,935 $12,293 $12,662 $13,042 $13,433 $13,836 $14,251 $14,679

Engineering-Nonconstruction-W 5.0% $2,000 $10,000 $10,500 $11,025 $11,576 $12,155 $12,763 $13,401 $14,071 $14,775 $15,513

Engineering-Billed by PSA-W 5.0% $725 $761 $799 $839 $881 $925 $972 $1,020 $1,071 $1,125 $1,181

Amort of Interest, Admin for Construction 0.0% $3,141 $3,141 $3,141 $3,141 $3,141 $3,141 $3,141 $3,141 $3,141 $3,141 $3,141

One-time Pmt Adj to Tank & Other Replace Funds 0.0% $28,097 $26,385 $0 $0 $0 $0 $0 $0 $0 $0 $0

Annual Payment to Tank & Other Replace Funds 0.0% $140,476 $140,476 $140,476 $140,476 $140,476 $140,476 $140,476 $140,476 $140,476 $140,476 $140,476

User Charge Analysis Services 5.0% $0 $5,169 $0 $0 $5,699 $0 $0 $6,283 $0 $0 $6,927

Debt Service 0.0% CIP CIP CIP CIP CIP CIP CIP CIP CIP CIP CIP

Adjustment to Replacement Payment NA -$140,476 -$140,476 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Costs $824,373 $994,125 $1,126,868 $1,165,479 $1,293,098 $1,334,351 $1,383,289 $1,440,583 $1,487,475 $1,542,907 $1,607,623

Net Income (or Loss) $242,292 $150,516 $218,759 $282,960 $269,746 $337,092 $386,655 $426,494 $490,717 $553,259 $613,858

Working Capital Goal: 50% In Dollars, That is: $412,187 $497,063 $563,434 $582,740 $646,549 $667,176 $691,644 $720,292 $743,737 $771,454 $803,812


Factor

(First year costs and net incomes are actual, subsequent years are projected.)



Class Name

Meter Size in Inches

Meter Square

Inch Capacity

Number Meters

This Size

Total Square

Inch Capacity

Each Meter

Size Group

Total Potential Demand

of a Meter This Size

Potential Demand

Charge per Meter per

Billing Period

Charge Modify-

ing Factor1

Adjusted Potential Demand


Billing Period2

New Minimum

Charge Base Rate

Total Minimum

Charge per Billing Period

Total Annual Demand

Charge Fees by Meter

Size3

Five Eighths 0.625 0.307 1,998 613 $56 $9.27 10% $0.93 $18.21 $19.14 $11,109Three Quarters 0.750 0.442 0 0 $56 $9.27 10% $0.93 $18.21 $19.14 $0

One Inch 1.000 0.785 53 42 $142 $23.72 100% $23.72 $18.21 $41.94 $7,591One & a Half Inch 1.500 1.767 11 20 $320 $53.38 100% $53.38 $18.21 $71.59 $3,630

Two Inch 2.000 3.142 52 164 $569 $94.89 100% $94.89 $18.21 $113.10 $29,701Three Inch 3.000 7.069 3 21 $1,281 $213.50 100% $213.50 $18.21 $231.72 $3,843

Four Inch 4.000 12.566 0 0 $2,277 $379.56 100% $379.56 $18.21 $397.78 $0Five Inch 5.000 19.635 0 0 $3,558 $593.06 100% $593.06 $18.21 $611.28 $0Six Inch 6.000 28.274 0 0 $5,124 $854.01 100% $854.01 $18.21 $872.23 $0

Seven Inch 7.000 38.485 0 0 $6,974 $1,162.40 100% $1,162.40 $18.21 $1,180.62 $0Eight Inch 8.000 50.266 0 0 $9,109 $1,518.24 100% $1,518.24 $18.21 $1,536.46 $0Nine Inch 9.000 63.617 0 0 $11,529 $1,921.53 100% $1,921.53 $18.21 $1,939.74 $0Ten Inch 10.000 78.540 0 0 $14,234 $2,372.25 100% $2,372.25 $18.21 $2,390.47 $0

Over-sized meters: 120 247 $44,764

All meters: 2,118 860 $55,873

High-flow Capacity Costs

Large Meter MaintPlant and Distribution

*Costs are amortized for 40 years at a 5.0 percent interest rate. $181.23

$1,696

(This is the amount of additional revenue this surcharge will produce when collected over a full year.)

N.A. N.A.

Total Cost From Balance Sheet

High-flow % of Total Cost High-flow Cost

Capital cost of potential demand per square inch of meter size

Annualized High-flow Cost*

$154,156N.A.

$2,645,180$13,225,901 20.0% $2,645,180 $155,853$13,225,901 20.0%

This chart depicts minimum charges that are commensurate with the potential of each customer, based on their connection or meter size, to place flow demands on the system. For simplicity, all five-eighths and three-quarter inch meters serving residential properties are assumed to have the same flow capacity and will pay the same potential demand surcharges.

1 Charge Modifying Factor is used to raise or lower the charges to be levied on each size class because small meter and residential users are less prone to wide variations in use, and thus, their peak usage is lower on a percentage basis.2 Adjusted Potential Demand Charge per Meter per Billing Period is the dollar amount that should be added to the standard minimum charge to arrive at the total minimum charge for each meter size class.3 Total Annual Demand Charge Fees by Meter Size - The sum at the bottom of this column is the dollar amount that these meter size based charges will generate in one year.

4 Annualized High-flow Cost to supply potential demand is the total dollar amount of capital investment that these charges seek to recover. The sum at the bottom of the last column of this chart, the amount that will actually be collected by these surcharges, will fall short of this amount if the Charge Modifying Factor for any size class is less than 100%.

Rockbridge County PSA, Water Rates Scenario 1 CBGreatRates© Version 5.2Chart 3 - Capital Improvement Program This chart depicts the capital improvements needed for the next 10 years and how they will be paid for. Costs reflect inflation.

This Year Next Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year 9th Year 10th YearYear Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting

CIP Spending Plan 7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

Capital Improvements to be Paid With Debt

Long Hollow Water System $0 $0 $421,200 $0 $0 $0 $0 $0 $0 $0 $0

Route 251 Improvements $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

16" TM To NLex Tanks $0 $0 $2,609,653 $0 $0 $0 $0 $0 $0 $0 $0

Natural Bridge Station/AV-2004 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Hydraulic Model--NLex System $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

N Lee High Pressure Zone Transfer Project $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Ext. to Natural Bridge Hotel Area $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Ext. to Fancy Hill -DEQ Grant $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Capital Improvements to be Paid With Debt $0 $0 $3,030,853 $0 $0 $0 $0 $0 $0 $0 $0

Capital Improvements to be Paid With Cash

Long Hollow Water System, Grant Funded $32,713 $0 $1,035,216 $0 $0 $0 $0 $0 $0 $0 $0

Route 251 Improvements $11,600 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

16" TM To NLex Tanks $14,993 $100,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

Natural Bridge Station/AV-2004 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Hydraulic Model--NLex System $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

N Lee High Pressure Zone Transfer Project $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Ext. to Natural Bridge Hotel Area $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Ext. to Fancy Hill -DEQ Grant $0 $0 $0 $1,081,600 $0 $0 $0 $0 $0 $0 $0

Long Hollow Water System, Reserves Funded $0 $0 $119,600 $0 $0 $0 $0 $0 $0 $0 $0

Total Cap Imprvmts to be Paid With Cash $59,306 $100,000 $1,154,816 $1,081,600 $0 $0 $0 $0 $0 $0 $0

Total CIP Planned Spending $59,306 $100,000 $4,185,669 $1,081,600 $0 $0 $0 $0 $0 $0 $0

CIP Funding Plan

CIP Reserves Carryover Plus Transfers in $653,294 $576,817 $534,371 $609,710 $519,984 $479,481 $472,900 $501,457 $607,300 $774,446 $996,305

CIP Reserves Interest Earned (or Paid) $0 $5,768 $4,081 $3,461 $3,140 $1,630 $1,107 $1,036 $1,400 $2,489 $4,148

Grants $59,306 $0 $1,035,216 $1,081,600 $0 $0 $0 $0 $0 $0 $0

Loan Originated Next Year $3,030,853 $0 $0 $0 $0 $0 $0 $0 $0

Total CIP Fund Sources $712,600 $582,585 $4,604,522 $1,694,771 $523,125 $481,111 $474,007 $502,493 $608,700 $776,935 $1,000,453

New Debt Payment Plan Payments for future loans assume 100 percent financing for projects, term of: 20 years and 4.000% interestLoan(s) Originated Before Test Year $76,478 $74,438 $72,798 $76,108 $137,094 $147,382 $147,382 $139,449 $136,782 $139,114 $136,204

Loan Originated Next Year $223,015 $223,015 $223,015 $223,015 $223,015 $223,015 $223,015 $223,015

Total Debt Obligations $76,478 $74,438 $72,798 $299,123 $360,110 $370,397 $370,397 $362,465 $359,797 $362,130 $359,220

Total CIP Spending Plus Debt Repayment $135,784 $174,438 $4,258,467 $1,380,723 $360,110 $370,397 $370,397 $362,465 $359,797 $362,130 $359,220

CIP Reserves Balance $576,817 $408,147 $346,055 $314,048 $163,015 $110,713 $103,609 $140,028 $248,903 $414,805 $641,234Notes: Several capital improvements are being completed now or were recently completed.


Chart 4A - Rate Adjustments and Incomes for Modeling Year 7/1/10 Through 6/30/11This chart depicts how rates would be set for this scenario.

$388 Current average hook up fee 1st rate block multiplier 100%

$388 Proposed average hook up fee 2nd rate block multiplier 100%

$0 3rd rate block multiplier N.A.

6/30/11After rate adjustments are made, customers will be billed every other month.

0 999 $3,017 $11.50 0.000 $0.00 $10 $3,0261,000 1,999 $0 $11.50 0.000 $0.00 $0 $0

0 999 $21,563 $19.14 0.000 $4.32 $83 $21,6461,000 1,999 $13,721 $19.14 0.000 $4.32 $49 $13,7702,000 2,999 $19,479 $19.14 0.000 $4.32 $67 $19,5463,000 3,999 $22,825 $19.14 0.000 $4.32 $77 $22,9024,000 4,999 $29,557 $19.14 0.000 $4.32 $98 $29,6555,000 5,999 $33,123 $19.14 0.000 $4.32 $108 $33,2306,000 6,999 $33,225 $19.14 0.000 $4.32 $107 $33,3327,000 7,999 $33,259 $19.14 0.000 $4.32 $106 $33,3658,000 8,999 $32,194 $19.14 0.000 $4.32 $102 $32,2959,000 9,999 $28,843 $19.14 0.000 $4.32 $91 $28,934

10,000 14,999 $89,197 $19.14 0.000 $4.32 $276 $89,47315,000 19,999 $37,914 $19.14 0.000 $4.32 $115 $38,02920,000 24,999 $16,624 $19.14 0.000 $4.32 $50 $16,67425,000 29,999 $8,045 $19.14 0.000 $4.32 $24 $8,06930,000 34,999 $7,144 $19.14 0.000 $4.32 $21 $7,16535,000 39,999 $5,562 $19.14 0.000 $4.32 $16 $5,57940,000 44,999 $3,944 $19.14 0.000 $4.32 $12 $3,95545,000 49,999 $3,995 $19.14 0.000 $4.32 $12 $4,00750,000 54,999 $3,266 $19.14 0.000 $4.32 $10 $3,27655,000 59,999 $2,520 $19.14 0.000 $4.32 $7 $2,52760,000 64,999 $1,388 $19.14 0.000 $4.32 $4 $1,39365,000 69,999 $2,063 $19.14 0.000 $4.32 $6 $2,06970,000 74,999 $2,522 $19.14 0.000 $4.32 $7 $2,52975,000 79,999 $1,025 $19.14 0.000 $4.32 $3 $1,02880,000 84,999 $719 $19.14 0.000 $4.32 $2 $72185,000 89,999 $1,136 $19.14 0.000 $4.32 $3 $1,13990,000 9,999,999 $20,634 $19.14 0.000 $4.32 $60 $20,694

0 999 $925 $41.94 0.000 $4.32 $3 $9281,000 1,999 $256 $41.94 0.000 $4.32 $1 $2572,000 2,999 $126 $41.94 0.000 $4.32 $0 $1273,000 3,999 $416 $41.94 0.000 $4.32 $1 $4184,000 4,999 $502 $41.94 0.000 $4.32 $2 $5045,000 5,999 $761 $41.94 0.000 $4.32 $3 $7636,000 6,999 $703 $41.94 0.000 $4.32 $2 $7057,000 7,999 $313 $41.94 0.000 $4.32 $1 $3148,000 8,999 $605 $41.94 0.000 $4.32 $2 $6079,000 9,999 $781 $41.94 0.000 $4.32 $3 $783

10,000 14,999 $2,171 $41.94 0.000 $4.32 $7 $2,17815,000 19,999 $1,765 $41.94 0.000 $4.32 $6 $1,77020,000 24,999 $2,461 $41.94 0.000 $4.32 $8 $2,46825,000 29,999 $2,326 $41.94 0.000 $4.32 $7 $2,33330,000 34,999 $1,312 $41.94 0.000 $4.32 $4 $1,31635,000 39,999 $1,332 $41.94 0.000 $4.32 $4 $1,33640,000 44,999 $1,696 $41.94 0.000 $4.32 $5 $1,70145,000 49,999 $2,305 $41.94 0.000 $4.32 $7 $2,31250,000 54,999 $1,758 $41.94 0.000 $4.32 $5 $1,76355,000 59,999 $1,327 $41.94 0.000 $4.32 $4 $1,33160,000 64,999 $1,442 $41.94 0.000 $4.32 $4 $1,44665,000 69,999 $4,007 $41.94 0.000 $4.32 $12 $4,01970,000 74,999 $1,009 $41.94 0.000 $4.32 $3 $1,01275,000 79,999 $1,058 $41.94 0.000 $4.32 $3 $1,06280,000 84,999 $3,353 $41.94 0.000 $4.32 $10 $3,36385,000 89,999 $1,199 $41.94 0.000 $4.32 $4 $1,20390,000 9,999,999 $39,833 $41.94 0.000 $4.32 $116 $39,949

Class Bottom Use in

Gallons

Class Top Use in

Gallons

Fire

line

5/8"

Met

ers

1" M

eter

sProposed User Rates and Blended User Rate Revenues for the Modeling Year

The part of the proposed average hook up fee, above, that will be devoted to future capital improvements

Date when fees will first be collected at adjusted rates - actual adjustment will probably occur one billing period earlier.

New Minimum

Charge Base Rates1

Total Revenues

for Modeling Year

New Unit Charge This

Class per 1,000 Gallons

Revenues at

Proposed Rates

Revenues at Test

Year Rates

New Usage Allowance in

1,000 Gallons

0 999 $0 $71.59 0.000 $4.32 $0 $01,000 1,999 $52 $71.59 0.000 $4.32 $0 $52

10,000 14,999 $106 $71.59 0.000 $4.32 $0 $10715,000 19,999 $807 $71.59 0.000 $4.32 $3 $80920,000 24,999 $571 $71.59 0.000 $4.32 $2 $57325,000 29,999 $317 $71.59 0.000 $4.32 $1 $31830,000 34,999 $881 $71.59 0.000 $4.32 $3 $88435,000 39,999 $623 $71.59 0.000 $4.32 $2 $62540,000 44,999 $1,333 $71.59 0.000 $4.32 $4 $1,33745,000 49,999 $487 $71.59 0.000 $4.32 $2 $48950,000 54,999 $260 $71.59 0.000 $4.32 $1 $26170,000 74,999 $344 $71.59 0.000 $4.32 $1 $34580,000 84,999 $385 $71.59 0.000 $4.32 $1 $38685,000 89,999 $824 $71.59 0.000 $4.32 $2 $82790,000 9,999,999 $43,174 $71.59 0.000 $4.32 $126 $43,301

0 999 $1,542 $113.10 0.000 $4.32 $6 $1,5491,000 1,999 $243 $113.10 0.000 $4.32 $1 $2442,000 2,999 $341 $113.10 0.000 $4.32 $1 $3423,000 3,999 $179 $113.10 0.000 $4.32 $1 $1804,000 4,999 $561 $113.10 0.000 $4.32 $2 $5645,000 5,999 $391 $113.10 0.000 $4.32 $1 $3926,000 6,999 $306 $113.10 0.000 $4.32 $1 $3077,000 7,999 $424 $113.10 0.000 $4.32 $2 $4268,000 8,999 $331 $113.10 0.000 $4.32 $1 $3329,000 9,999 $229 $113.10 0.000 $4.32 $1 $230

10,000 14,999 $732 $113.10 0.000 $4.32 $3 $73515,000 19,999 $451 $113.10 0.000 $4.32 $2 $45320,000 24,999 $699 $113.10 0.000 $4.32 $2 $70125,000 29,999 $1,510 $113.10 0.000 $4.32 $5 $1,51530,000 34,999 $1,870 $113.10 0.000 $4.32 $6 $1,87635,000 39,999 $2,325 $113.10 0.000 $4.32 $8 $2,33340,000 44,999 $2,274 $113.10 0.000 $4.32 $7 $2,28145,000 49,999 $1,903 $113.10 0.000 $4.32 $6 $1,91050,000 54,999 $872 $113.10 0.000 $4.32 $3 $87455,000 59,999 $628 $113.10 0.000 $4.32 $2 $63060,000 64,999 $2,035 $113.10 0.000 $4.32 $6 $2,04165,000 69,999 $1,436 $113.10 0.000 $4.32 $5 $1,44070,000 74,999 $1,126 $113.10 0.000 $4.32 $4 $1,12975,000 79,999 $1,606 $113.10 0.000 $4.32 $5 $1,61180,000 84,999 $2,083 $113.10 0.000 $4.32 $6 $2,08985,000 89,999 $1,748 $113.10 0.000 $4.32 $5 $1,75390,000 9,999,999 $254,393 $113.10 0.000 $4.32 $749 $255,142

0 999 $0 $231.72 0.000 $4.32 $0 $035,000 39,999 $290 $231.72 0.000 $4.32 $1 $29190,000 9,999,999 $52,564 $231.72 0.000 $4.32 $155 $52,719

0 999 $0 $397.78 0.000 $4.32 $0 $01,000 1,999 $0 $397.78 0.000 $4.32 $0 $0

90,000 9,999,999 $0 $397.78 0.000 $4.32 $0 $0

0 999 $4,947 $51.87 4.000 $8.18 $18 $4,9651,000 1,999 $2,735 $51.87 4.000 $8.18 $10 $2,7452,000 2,999 $5,028 $51.87 4.000 $8.18 $18 $5,0463,000 3,999 $4,786 $51.87 4.000 $8.18 $17 $4,8044,000 4,999 $5,475 $51.87 4.000 $8.18 $19 $5,4945,000 5,999 $6,912 $51.87 4.000 $8.18 $24 $6,9366,000 6,999 $7,088 $51.87 4.000 $8.18 $24 $7,1117,000 7,999 $6,808 $51.87 4.000 $8.18 $22 $6,8308,000 8,999 $5,732 $51.87 4.000 $8.18 $18 $5,7519,000 9,999 $5,398 $51.87 4.000 $8.18 $17 $5,415

10,000 14,999 $19,447 $51.87 4.000 $8.18 $61 $19,50815,000 19,999 $5,347 $51.87 4.000 $8.18 $16 $5,36420,000 24,999 $1,632 $51.87 4.000 $8.18 $5 $1,63725,000 29,999 $692 $51.87 4.000 $8.18 $2 $69430,000 34,999 $254 $51.87 4.000 $8.18 $1 $25535,000 39,999 $294 $51.87 4.000 $8.18 $1 $29455,000 59,999 $474 $51.87 4.000 $8.18 $1 $47685,000 89,999 $717 $51.87 4.000 $8.18 $2 $71990,000 9,999,999 $935 $51.87 4.000 $8.18 $3 $937

0 999 $0 $0.00 0.000 $0.00 $0 $01,000 1,999 $0 $0.00 0.000 $0.00 $0 $02,000 2,999 $0 $0.00 0.000 $0.00 $0 $0

90,000 9,999,999 $0 $0.00 0.000 $0.00 $0 $0

Extra Service Units $0 $5.56 0.000 $0.00 $51.65 $51.65$1,024,257 Rate Rev at Adjusted Rates $3,228

Total Blended Rate Revenues for the Year 2 $1,027,485

Note 2: Blended Rate Revenues for the one-year period 7/1/10 through 6/30/11 assume the following:12.0 months at the old user charge rates and 0.0


1,000 Gallons



Revenues at

Proposed Rates

Total Blended

Revenues for Modeling

Year

Leak

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ng

Class Bottom Use in

Gallons

Class Top Use in

Gallons

Revenues at Test

Year Rates

New Minimum

Charge Base Rates1

2" M

eter

s1

1/2"

Met

ers

3" M

eter

s4"

Met

ers

Long

Hol

low

(5/8

" Met

ers)

Rate Rev at Current Rates

Note 1: Not applicable.

months at the new user charge rates.

Rockbridge County PSA, Water Rates Scenario 1Chart 4B - Rate Statistics CBGreatRates© Version 5.2

This chart shows the equitability of the rates as modeled in the Rate Setting Chart.

Your average residential customer uses 7,400 Gallons per billing cycle.


Class Top Use in Gallons % Users % Usage

% Rev at Current Rates

% Rev at Proposed

Rates 0 999 1.83% 0.00% 0.29% 0.30%

1.83% 0.00% 0.29% 0.30%

0 999 9.11% 0.15% 2.11% 2.56%1,000 1,999 4.25% 0.53% 1.34% 1.52%2,000 2,999 4.98% 1.05% 1.90% 2.08%3,000 3,999 4.98% 1.47% 2.23% 2.38%4,000 4,999 5.62% 2.14% 2.89% 3.03%5,000 5,999 5.56% 2.61% 3.23% 3.34%6,000 6,999 5.02% 2.77% 3.24% 3.31%7,000 7,999 4.56% 2.91% 3.25% 3.28%8,000 8,999 4.04% 2.92% 3.14% 3.15%9,000 9,999 3.32% 2.70% 2.82% 2.80%

10,000 14,999 8.60% 8.83% 8.71% 8.55%15,000 19,999 2.74% 4.01% 3.70% 3.57%20,000 24,999 0.97% 1.82% 1.62% 1.55%25,000 29,999 0.39% 0.90% 0.79% 0.74%30,000 34,999 0.29% 0.82% 0.70% 0.66%35,000 39,999 0.20% 0.64% 0.54% 0.51%40,000 44,999 0.13% 0.46% 0.39% 0.36%45,000 49,999 0.12% 0.47% 0.39% 0.36%50,000 54,999 0.09% 0.39% 0.32% 0.30%55,000 59,999 0.06% 0.30% 0.25% 0.23%60,000 64,999 0.03% 0.17% 0.14% 0.13%65,000 69,999 0.04% 0.25% 0.20% 0.19%70,000 74,999 0.05% 0.30% 0.25% 0.23%75,000 79,999 0.02% 0.12% 0.10% 0.09%80,000 84,999 0.01% 0.09% 0.07% 0.06%85,000 89,999 0.02% 0.14% 0.11% 0.10%90,000 9,999,999 0.17% 2.56% 2.01% 1.85%

65.37% 41.54% 46.42% 46.96%

0 999 0.18% 0.00% 0.09% 0.11%1,000 1,999 0.04% 0.00% 0.03% 0.03%2,000 2,999 0.02% 0.00% 0.01% 0.01%3,000 3,999 0.06% 0.02% 0.04% 0.04%4,000 4,999 0.06% 0.02% 0.05% 0.05%5,000 5,999 0.09% 0.04% 0.07% 0.08%6,000 6,999 0.07% 0.04% 0.07% 0.07%7,000 7,999 0.03% 0.02% 0.03% 0.03%8,000 8,999 0.06% 0.04% 0.06% 0.06%9,000 9,999 0.07% 0.05% 0.08% 0.08%

10,000 14,999 0.16% 0.17% 0.21% 0.21%15,000 19,999 0.10% 0.15% 0.17% 0.17%20,000 24,999 0.12% 0.23% 0.24% 0.24%25,000 29,999 0.10% 0.23% 0.23% 0.22%30,000 34,999 0.05% 0.13% 0.13% 0.12%35,000 39,999 0.04% 0.14% 0.13% 0.12%40,000 44,999 0.05% 0.18% 0.17% 0.16%45,000 49,999 0.06% 0.25% 0.23% 0.21%50,000 54,999 0.04% 0.19% 0.17% 0.16%55,000 59,999 0.03% 0.15% 0.13% 0.12%60,000 64,999 0.03% 0.16% 0.14% 0.13%65,000 69,999 0.08% 0.45% 0.39% 0.37%70,000 74,999 0.02% 0.12% 0.10% 0.09%75,000 79,999 0.02% 0.12% 0.10% 0.10%80,000 84,999 0.06% 0.39% 0.33% 0.31%85,000 89,999 0.02% 0.14% 0.12% 0.11%90,000 9,999,999 0.31% 4.82% 3.89% 3.59%

1.96% 8.28% 7.39% 7.01%

1" M

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s5/

8" M

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sFi

relin

e

Compare the % of Usage and % of Revenue for this volume of use, and others, in the chart below to get an idea of how proportional to actual volume use the rates are as proposed in this analysis.

If your rates are absolutely proportional to use on a volumetric basis, your % of usage and % of revenues figures will be the same within all the classes. That is not possible if you have any minimum charge.

Normally, the % of usage figure will be lower than the % of revenue for the lower volume classes. That will switch for the higher volume classes. Even for declining rate structures, this switch should occur near the volume of the average residential user, typically near 5,000 gallons/month (668 cu ft).

In urban and suburban areas the average monthly use for residential or general customers can be twice that used by their rural and "old town" counterparts. Use is largely dependent upon who lives in a community. Older people living in longer established neighborhoods tend to use less volume than younger people living in more recently developed areas. Consider this.


Class Top Use in Gallons % Users % Usage % Rev at

Current Rates

% Rev at Proposed

Rates 0 999 0.00% 0.00% 0.00% 0.00%

1,000 1,999 0.01% 0.00% 0.01% 0.01%10,000 14,999 0.01% 0.01% 0.01% 0.01%15,000 19,999 0.04% 0.06% 0.08% 0.08%20,000 24,999 0.02% 0.05% 0.06% 0.06%25,000 29,999 0.01% 0.03% 0.03% 0.03%30,000 34,999 0.03% 0.08% 0.09% 0.09%35,000 39,999 0.02% 0.06% 0.06% 0.06%40,000 44,999 0.04% 0.13% 0.13% 0.13%45,000 49,999 0.01% 0.05% 0.05% 0.05%50,000 54,999 0.01% 0.03% 0.03% 0.03%70,000 74,999 0.01% 0.04% 0.03% 0.03%80,000 84,999 0.01% 0.04% 0.04% 0.04%85,000 89,999 0.01% 0.09% 0.08% 0.08%90,000 9,999,999 0.19% 5.26% 4.22% 3.91%

0.42% 5.92% 4.90% 4.61%

0 999 0.12% 0.00% 0.15% 0.19%1,000 1,999 0.02% 0.00% 0.02% 0.03%2,000 2,999 0.02% 0.00% 0.03% 0.04%3,000 3,999 0.01% 0.00% 0.02% 0.02%4,000 4,999 0.04% 0.01% 0.05% 0.07%5,000 5,999 0.02% 0.01% 0.04% 0.05%6,000 6,999 0.02% 0.01% 0.03% 0.04%7,000 7,999 0.02% 0.01% 0.04% 0.05%8,000 8,999 0.02% 0.01% 0.03% 0.04%9,000 9,999 0.01% 0.01% 0.02% 0.03%

10,000 14,999 0.04% 0.03% 0.07% 0.08%15,000 19,999 0.02% 0.03% 0.04% 0.05%20,000 24,999 0.02% 0.05% 0.07% 0.07%25,000 29,999 0.05% 0.11% 0.15% 0.16%30,000 34,999 0.06% 0.15% 0.18% 0.19%35,000 39,999 0.06% 0.20% 0.23% 0.24%40,000 44,999 0.06% 0.20% 0.22% 0.23%45,000 49,999 0.04% 0.17% 0.19% 0.19%50,000 54,999 0.02% 0.08% 0.09% 0.09%55,000 59,999 0.01% 0.06% 0.06% 0.06%60,000 64,999 0.04% 0.20% 0.20% 0.20%65,000 69,999 0.02% 0.14% 0.14% 0.14%70,000 74,999 0.02% 0.11% 0.11% 0.11%75,000 79,999 0.02% 0.16% 0.16% 0.15%80,000 84,999 0.03% 0.21% 0.20% 0.20%85,000 89,999 0.02% 0.18% 0.17% 0.17%90,000 9,999,999 1.07% 30.38% 24.84% 23.19%

1.91% 32.55% 27.56% 26.07%

0 999 0.00% 0.00% 0.00% 0.00%35,000 39,999 0.01% 0.02% 0.03% 0.03%90,000 9,999,999 0.10% 6.32% 5.13% 4.81%

0.11% 6.34% 5.16% 4.84%

0 999 0.00% 0.00% 0.00% 0.00%90,000 9,999,999 0.00% 0.00% 0.00% 0.00%

0.00% 0.00% 0.00% 0.00%

0 999 0.75% 0.01% 0.48% 0.55%1,000 1,999 0.42% 0.05% 0.27% 0.30%2,000 2,999 0.76% 0.16% 0.49% 0.56%3,000 3,999 0.73% 0.22% 0.47% 0.53%4,000 4,999 0.76% 0.29% 0.53% 0.60%5,000 5,999 0.81% 0.38% 0.67% 0.73%6,000 6,999 0.73% 0.40% 0.69% 0.73%7,000 7,999 0.62% 0.39% 0.66% 0.69%8,000 8,999 0.46% 0.33% 0.56% 0.57%9,000 9,999 0.39% 0.32% 0.53% 0.53%

10,000 14,999 1.14% 1.17% 1.90% 1.88%15,000 19,999 0.23% 0.33% 0.52% 0.50%20,000 24,999 0.06% 0.10% 0.16% 0.15%25,000 29,999 0.02% 0.04% 0.07% 0.06%30,000 34,999 0.01% 0.02% 0.02% 0.02%35,000 39,999 0.01% 0.02% 0.03% 0.03%55,000 59,999 0.01% 0.03% 0.05% 0.04%85,000 89,999 0.01% 0.05% 0.07% 0.06%90,000 9,999,999 0.01% 0.06% 0.09% 0.08%

7.90% 4.38% 8.27% 8.62%

0 999 0.04% 0.99% 0.00% 0.00%1,000 1,999 0.00% 0.00% 0.00% 0.00%2,000 2,999 0.00% 0.00% 0.00% 0.00%

90,000 9,999,999 0.00% 0.00% 0.00% 0.00%0.04% 0.99% 0.00% 0.00%

Extra Service Units 20.46% 0.00% 0.00% 1.60%

1 1/

2" M

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s2"

Met

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3" M

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Met

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Long

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" Met

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Leak

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ng


Chart 5 - Indicators This chart depicts the affordability of future rates, the financial health of the system and the ending balances in various accounts for 10 years. CBGreatRates© Version 5.2

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Capacity Indicators 7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

$35.71 $39.15 $46.77 $48.65 $50.59 $52.62 $54.72 $56.91 $59.18 $61.55 $64.01

$27.50 $31.18 $32.43 $33.73 $35.07 $36.48 $37.94 $39.45 $41.03 $42.67 $44.38

$45,803 $47,045 $48,320 $49,630 $50,975 $52,357 $53,776 $55,234 $56,731 $58,269 $59,848

0.72% 0.80% 0.81% 0.82% 0.83% 0.84% 0.85% 0.86% 0.87% 0.88% 0.89%

1.39 1.47 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50

8.54 6.48 5.75 2.05 1.45 1.30 1.28 1.39 1.69 2.15 2.79

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Reserves 6/30/10 6/30/11 6/30/12 6/30/13 6/30/14 6/30/15 6/30/16 6/30/17 6/30/18 6/30/19 6/30/20

$320,384 $470,899 $563,434 $582,740 $646,549 $667,176 $691,644 $720,292 $743,737 $771,454 $803,812

$576,817 $408,147 $346,055 $314,048 $163,015 $110,713 $103,609 $140,028 $248,903 $414,805 $641,234

$174,125 $169,115 $43,189 $125,154 $111,875 $206,397 $259,890 $37,116 $63,660 -$36,479 -$50,020

$897,200 $879,047 $873,110 $826,479 $716,251 $660,697 $648,428 $673,422 $745,917 $855,755 $1,000,743

Tank & Other Replace Funds

Cash & Cash Equivalents (Current Position)

CIP Reserves

Affordability Index is the percent of AMHI needed by a 5,000 gallon per month residential user to pay their bill. Rates near 1.0% are common in the U.S. and are generally considered affordable. Federal grant agencies generally will not consider awarding grants if this indicator is less than 2.0%.

1.0 is break even for Operating Ratio. Below 1.0 indicates operating in the "red." Generally, the operating ratio should be at least 1.15 for large systems, 1.30 or more for medium systems and perhaps as high as 2.0 for small systems.

Coverage Ratio applies only to years with debt service. 1.0 is break even. Generally, the coverage ratio should be at least 1.25.

All Assets Except Hard Assets and R&R, Discounted for Inflation (Future

Purchasing Power)

Equivalent Average Monthly Bill Actually Paid by All Customers Throughout the

Year

Equivalent Final Monthly Bill for a 5,000 gal per Month Residential User

Annual Median Household Income (AMHI)

Affordability Index for Proposed Rates

Estimated Operating Ratio for Proposed Rates

Estimated Coverage Ratio for Proposed Rates

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 6 - Operating Ratio

Proposed Rates

Current Rates

Rockbridge County PSA

-8.00

-6.00

-4.00

-2.00

0.00

2.00

4.00

6.00

8.00

10.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 7 - Coverage Ratio

Proposed RatesCurrent Rates

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

$50.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 8 - 5,000 Gal Residential User's Bill

Proposed Rates

Current Rates


0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

1.00%

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 9 - Affordability IndexProposed Rates

Current Rates

-$100,000

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 10 - Working CapitalProposed RatesCurrent RatesGoal

Rockbridge County

-$3,000,000

-$2,500,000

-$2,000,000

-$1,500,000

-$1,000,000

-$500,000

$0

$500,000

$1,000,000

$1,500,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 11 - Future Purchasing Power of Liquid Assets

At Proposed Rates

At Current Rates

-1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0-99

9

1000

-199

9

2000

-299

9

3000

-399

9

4000

-499

9

5000

-599

9

6000

-699

9

7000

-799

9

8000

-899

9

9000

-999

9

1000

0-14

999

1500

0-19

999

2000

0-24

999

2500

0-29

999

8000

0-84

999

8500

0-89

999

9000

0-99

9999

9

Chart 13 - Residential Use & Revenues

% Usage


% Rev at Proposed Rates


-$100,000

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 12 - Current Position


0%

5%

10%

15%

20%

25%

30%

35%

1" M

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1 1/

2"

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2" M

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3" M

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Long

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ollo

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(5/8

" M

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Chart 13B - All Other Use & Revenues

% Usage




$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 8B - System-wide Average User's BillProposed Rates

Current Regime


0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 9B - Over-all Affordability IndexProposed Rates

Current Regime

Rockbridge County PSA, Water Rates Scenario 1Chart 14 - Old Rates, New Rates and ChangesThis chart compares current and proposed rates. CBGreatRates© Version 5.2

6/30/110 999 0.000 $10.00 $11.50 $1.50 15%

1,000 1,999 0.000 $10.00 $11.50 $1.50 15%

0 999 0.189 $14.38 $19.96 $5.58 39%1,000 1,999 1.452 $19.61 $25.41 $5.81 30%2,000 2,999 2.465 $23.80 $29.79 $5.99 25%3,000 3,999 3.446 $27.85 $34.02 $6.17 22%4,000 4,999 4.445 $31.99 $38.34 $6.35 20%5,000 5,999 5.463 $36.20 $42.73 $6.54 18%6,000 6,999 6.430 $40.20 $46.91 $6.71 17%7,000 7,999 7.432 $44.34 $51.23 $6.89 16%8,000 8,999 8.422 $48.44 $55.51 $7.07 15%9,000 9,999 9.484 $52.83 $60.09 $7.27 14%

10,000 14,999 11.953 $63.05 $70.76 $7.72 12%15,000 19,999 17.010 $83.98 $92.61 $8.64 10%20,000 24,999 22.001 $104.64 $114.18 $9.55 9%25,000 29,999 26.924 $125.01 $135.46 $10.44 8%30,000 34,999 32.479 $148.01 $159.46 $11.46 8%35,000 39,999 37.218 $167.62 $179.94 $12.32 7%40,000 44,999 41.843 $186.76 $199.92 $13.16 7%45,000 49,999 47.242 $209.11 $223.26 $14.14 7%50,000 54,999 52.779 $232.03 $247.18 $15.15 7%55,000 59,999 57.270 $250.62 $266.59 $15.97 6%60,000 64,999 63.440 $276.16 $293.25 $17.09 6%65,000 69,999 67.529 $293.08 $310.92 $17.84 6%70,000 74,999 72.463 $313.50 $332.24 $18.74 6%75,000 79,999 78.800 $339.74 $359.63 $19.89 6%80,000 84,999 83.100 $357.53 $378.21 $20.67 6%85,000 89,999 87.667 $376.44 $397.94 $21.51 6%90,000 9,999,999 180.319 $760.01 $798.39 $38.38 5%

0 999 0.059 $31.72 $42.19 $10.47 33%1,000 1,999 1.186 $36.38 $47.06 $10.67 29%2,000 2,999 2.500 $41.82 $52.73 $10.91 26%3,000 3,999 3.511 $46.00 $57.10 $11.10 24%4,000 4,999 4.460 $49.93 $61.20 $11.27 23%5,000 5,999 5.457 $54.05 $65.50 $11.45 21%6,000 6,999 6.475 $58.26 $69.90 $11.64 20%7,000 7,999 7.460 $62.34 $74.15 $11.81 19%8,000 8,999 8.556 $66.87 $78.88 $12.01 18%9,000 9,999 9.455 $70.58 $82.76 $12.18 17%

10,000 14,999 12.462 $83.03 $95.75 $12.73 15%15,000 19,999 17.341 $103.23 $116.84 $13.61 13%20,000 24,999 21.965 $122.37 $136.82 $14.46 12%25,000 29,999 27.331 $144.58 $160.01 $15.43 11%30,000 34,999 31.800 $163.07 $179.32 $16.25 10%35,000 39,999 38.129 $189.27 $206.67 $17.40 9%40,000 44,999 43.325 $210.78 $229.13 $18.35 9%45,000 49,999 47.780 $229.22 $248.38 $19.16 8%50,000 54,999 52.743 $249.76 $269.82 $20.06 8%55,000 59,999 56.160 $263.90 $284.59 $20.68 8%60,000 64,999 61.700 $286.84 $308.53 $21.69 8%65,000 69,999 66.454 $306.51 $329.07 $22.56 7%70,000 74,999 73.200 $334.44 $358.22 $23.79 7%75,000 79,999 77.167 $350.85 $375.36 $24.51 7%80,000 84,999 81.922 $370.54 $395.91 $25.38 7%85,000 89,999 88.433 $397.49 $424.05 $26.56 7%90,000 9,999,999 180.037 $776.73 $819.97 $43.25 6%

Median or Actual

Average use in 1,000 Gallons

Percent Increase or

Decrease (-) After Rate

Adjustment

Proposed Average Bill Starting onCurrent

Average Bill

Bill Increase or (Decrease)

After Rate Adjustment



Fire

line

5/8"

Met

ers

1" M

eter

s

6/30/110 999 0.500 $49.87 $73.75 $23.88 48%

1,000 1,999 1.000 $51.94 $75.91 $23.97 46%2,000 2,999 2.000 $56.07 $80.23 $24.15 43%3,000 3,999 3.500 $62.28 $86.70 $24.43 39%4,000 4,999 4.500 $66.41 $91.02 $24.61 37%5,000 5,999 5.500 $70.55 $95.34 $24.79 35%6,000 6,999 6.500 $74.68 $99.66 $24.97 33%7,000 7,999 7.500 $78.82 $103.97 $25.16 32%8,000 8,999 8.500 $82.95 $108.29 $25.34 31%9,000 9,999 9.500 $87.09 $112.61 $25.52 29%

10,000 14,999 14.000 $105.72 $132.06 $26.34 25%15,000 19,999 16.143 $114.59 $141.31 $26.73 23%20,000 24,999 22.750 $141.94 $169.87 $27.93 20%25,000 29,999 26.500 $157.46 $186.07 $28.62 18%30,000 34,999 30.800 $175.25 $204.65 $29.40 17%35,000 39,999 38.333 $206.44 $237.21 $30.77 15%40,000 44,999 41.833 $220.92 $252.33 $31.41 14%45,000 49,999 47.000 $242.31 $274.66 $32.35 13%50,000 54,999 51.000 $258.87 $291.94 $33.08 13%55,000 59,999 57.500 $285.77 $320.03 $34.26 12%60,000 64,999 62.500 $306.47 $341.64 $35.17 11%65,000 69,999 67.500 $327.16 $363.24 $36.08 11%70,000 74,999 71.000 $341.65 $378.37 $36.72 11%75,000 79,999 77.500 $368.55 $406.46 $37.90 10%80,000 84,999 81.000 $383.04 $421.58 $38.54 10%85,000 89,999 87.500 $409.95 $449.67 $39.72 10%90,000 9,999,999 323.032 $1,385.05 $1,467.68 $82.63 6%

0 999 0.045 $76.69 $113.30 $36.61 48%1,000 1,999 1.000 $80.64 $117.42 $36.79 46%2,000 2,999 2.000 $84.77 $121.74 $36.97 44%3,000 3,999 3.000 $88.91 $126.06 $37.15 42%4,000 4,999 4.000 $93.04 $130.38 $37.33 40%5,000 5,999 5.000 $97.18 $134.69 $37.51 39%6,000 6,999 6.000 $101.32 $139.01 $37.70 37%7,000 7,999 7.000 $105.45 $143.33 $37.88 36%8,000 8,999 8.000 $109.59 $147.65 $38.06 35%9,000 9,999 9.000 $113.72 $151.97 $38.24 34%

10,000 14,999 10.850 $121.38 $159.96 $38.58 32%15,000 19,999 17.667 $149.59 $189.42 $39.82 27%20,000 24,999 23.500 $173.74 $214.62 $40.88 24%25,000 29,999 26.875 $187.71 $229.21 $41.50 22%30,000 34,999 31.444 $206.62 $248.95 $42.33 20%35,000 39,999 37.390 $231.23 $274.65 $43.41 19%40,000 44,999 42.222 $251.23 $295.53 $44.29 18%45,000 49,999 46.857 $270.42 $315.56 $45.14 17%50,000 54,999 51.333 $288.95 $334.90 $45.95 16%55,000 59,999 57.000 $312.40 $359.39 $46.98 15%60,000 64,999 63.000 $337.24 $385.31 $48.08 14%65,000 69,999 67.750 $356.90 $405.84 $48.94 14%70,000 74,999 71.667 $373.11 $422.76 $49.66 13%75,000 79,999 78.000 $399.32 $450.13 $50.81 13%80,000 84,999 81.600 $414.22 $465.69 $51.46 12%85,000 89,999 86.500 $434.51 $486.86 $52.36 12%90,000 9,999,999 330.741 $1,445.66 $1,542.51 $96.85 7%



Median or Actual


Current Average Bill

Proposed Average Bill Starting on



Percent Increase or


Adjustment

1 1/

2" M

eter

s2"

Met

ers

6/30/110 999 0.500 $145.51 $233.88 $88.37 61%

1,000 1,999 1.500 $149.64 $238.19 $88.55 59%2,000 2,999 2.500 $153.78 $242.51 $88.73 58%3,000 3,999 3.500 $157.92 $246.83 $88.91 56%4,000 4,999 4.500 $162.05 $251.15 $89.10 55%5,000 5,999 5.500 $166.19 $255.47 $89.28 54%6,000 6,999 6.500 $170.32 $259.78 $89.46 53%7,000 7,999 7.500 $174.46 $264.10 $89.64 51%8,000 8,999 8.500 $178.59 $268.42 $89.82 50%9,000 9,999 9.500 $182.73 $272.74 $90.01 49%

10,000 14,999 12.500 $195.15 $285.70 $90.55 46%15,000 19,999 17.500 $215.84 $307.31 $91.46 42%20,000 24,999 22.500 $236.54 $328.91 $92.37 39%25,000 29,999 27.500 $257.23 $350.52 $93.28 36%30,000 34,999 32.500 $277.93 $372.13 $94.20 34%35,000 39,999 35.000 $288.28 $382.93 $94.65 33%40,000 44,999 42.500 $319.32 $415.34 $96.02 30%45,000 49,999 47.500 $340.02 $436.94 $96.93 29%50,000 54,999 52.500 $360.71 $458.55 $97.84 27%55,000 59,999 57.500 $381.41 $480.16 $98.75 26%60,000 64,999 62.500 $402.11 $501.76 $99.66 25%65,000 69,999 67.500 $422.80 $523.37 $100.57 24%70,000 74,999 72.500 $443.50 $544.98 $101.48 23%75,000 79,999 77.500 $464.19 $566.58 $102.39 22%80,000 84,999 82.500 $484.89 $588.19 $103.30 21%85,000 89,999 87.500 $505.58 $609.80 $104.21 21%90,000 9,999,999 708.118 $3,074.94 $3,292.20 $217.26 7%

0 999 0.500 $213.21 $399.93 $186.73 88%1,000 1,999 1.500 $217.34 $404.25 $186.91 86%2,000 2,999 2.500 $221.48 $408.57 $187.09 84%3,000 3,999 3.500 $225.62 $412.89 $187.27 83%4,000 4,999 4.500 $229.75 $417.21 $187.45 82%5,000 5,999 5.500 $233.89 $421.52 $187.64 80%6,000 6,999 6.500 $238.02 $425.84 $187.82 79%7,000 7,999 7.500 $242.16 $430.16 $188.00 78%8,000 8,999 8.500 $246.29 $434.48 $188.18 76%9,000 9,999 9.500 $250.43 $438.79 $188.36 75%

10,000 14,999 12.500 $262.85 $451.76 $188.91 72%15,000 19,999 17.500 $283.54 $473.36 $189.82 67%20,000 24,999 22.500 $304.24 $494.97 $190.73 63%25,000 29,999 27.500 $324.93 $516.58 $191.64 59%30,000 34,999 32.500 $345.63 $538.18 $192.55 56%35,000 39,999 37.500 $366.33 $559.79 $193.46 53%40,000 44,999 42.500 $387.02 $581.40 $194.37 50%45,000 49,999 47.500 $407.72 $603.00 $195.28 48%50,000 54,999 52.500 $428.41 $624.61 $196.20 46%55,000 59,999 57.500 $449.11 $646.22 $197.11 44%60,000 64,999 62.500 $469.81 $667.82 $198.02 42%65,000 69,999 67.500 $490.50 $689.43 $198.93 41%70,000 74,999 72.500 $511.20 $711.03 $199.84 39%75,000 79,999 77.500 $531.89 $732.64 $200.75 38%80,000 84,999 82.500 $552.59 $754.25 $201.66 36%85,000 89,999 87.500 $573.28 $775.85 $202.57 35%90,000 9,999,999 5,045.000 $21,097.33 $22,202.96 $1,105.63 5%



Median or Actual




Percent Increase or


AdjustmentCurrent

Average Bill


3" M

eter

s4"

Met

ers

6/30/110 999 0.191 $40.00 $51.87 $11.87 30%

1,000 1,999 1.534 $40.00 $51.87 $11.87 30%2,000 2,999 2.433 $40.00 $51.87 $11.87 30%3,000 3,999 3.466 $40.00 $51.87 $11.87 30%4,000 4,999 4.489 $43.91 $55.87 $11.96 27%5,000 5,999 5.462 $51.69 $63.82 $12.14 23%6,000 6,999 6.406 $59.23 $71.54 $12.31 21%7,000 7,999 7.382 $67.03 $79.52 $12.49 19%8,000 8,999 8.380 $75.01 $87.68 $12.67 17%9,000 9,999 9.489 $83.87 $96.74 $12.87 15%

10,000 14,999 11.934 $103.42 $116.74 $13.31 13%15,000 19,999 16.973 $143.73 $157.96 $14.23 10%20,000 24,999 21.556 $180.38 $195.45 $15.07 8%25,000 29,999 27.667 $229.26 $245.44 $16.18 7%30,000 34,999 30.600 $252.72 $269.43 $16.71 7%35,000 39,999 35.500 $291.91 $309.52 $17.61 6%40,000 44,999 42.500 $347.90 $366.78 $18.88 5%45,000 49,999 47.500 $387.89 $407.68 $19.79 5%50,000 54,999 52.500 $427.88 $448.59 $20.70 5%55,000 59,999 58.000 $471.88 $493.58 $21.70 5%60,000 64,999 62.500 $507.87 $530.39 $22.52 4%65,000 69,999 67.500 $547.86 $571.29 $23.43 4%70,000 74,999 72.500 $587.85 $612.20 $24.34 4%75,000 79,999 77.500 $627.84 $653.10 $25.26 4%80,000 84,999 82.500 $667.84 $694.00 $26.17 4%85,000 89,999 88.100 $712.63 $739.82 $27.19 4%90,000 9,999,999 115.200 $929.42 $961.55 $32.12 3%

Extra Service Units $0.00 $5.56 $5.56 #DIV/0!



Percent Increase or


AdjustmentClass Bottom

Use in GallonsClass Top

Use in Gallons

Median or Actual




Long

Hol

low

(5/8

" Met

ers)

Rockbridge County PSA CBGreatRates© Version 5.2

Chart 15 - Test Year Usage One-year period being analyzed starts 7/1/2009

This chart shows usage by your customers, averaged across the entire test year. Date this scenario created 1/14/2011



Median or Actual Average use in 1,000 Gallons Ju

ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.000 50 50 50 50 50 50 501,000 1,999 0.000 0 0 0 0 0 0 02,000 2,999 2.500 0 0 0 0 0 0 0

Subtotal: 500 999 0.189 249 249 249 249 249 249 249

1,000 1,999 1.452 116 116 116 116 116 116 1162,000 2,999 2.465 136 136 136 136 136 136 1363,000 3,999 3.446 136 136 136 136 136 136 1364,000 4,999 4.445 153 153 153 153 153 153 1535,000 5,999 5.463 152 152 152 152 152 152 1526,000 6,999 6.430 137 137 137 137 137 137 1377,000 7,999 7.432 124 124 124 124 124 124 1248,000 8,999 8.422 110 110 110 110 110 110 1109,000 9,999 9.484 91 91 91 91 91 91 91

10,000 14,999 11.953 235 235 235 235 235 235 23515,000 19,999 17.010 75 75 75 75 75 75 7520,000 24,999 22.001 26 26 26 26 26 26 2625,000 29,999 26.924 11 11 11 11 11 11 1130,000 34,999 32.479 8 8 8 8 8 8 835,000 39,999 37.218 6 6 6 6 6 6 640,000 44,999 41.843 4 4 4 4 4 4 445,000 49,999 47.242 3 3 3 3 3 3 350,000 54,999 52.779 2 2 2 2 2 2 255,000 59,999 57.270 2 2 2 2 2 2 260,000 64,999 63.440 1 1 1 1 1 1 165,000 69,999 67.529 1 1 1 1 1 1 170,000 74,999 72.463 1 1 1 1 1 1 175,000 79,999 78.800 1 1 1 1 1 1 180,000 84,999 83.100 0 0 0 0 0 0 085,000 89,999 87.667 1 1 1 1 1 1 190,000 9,999,999 180.319 5 5 5 5 5 5 5

Subtotal: 1,783

Fire

line

5/8"

Met

ers




ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.059 5 5 5 5 5 5 51,000 1,999 1.186 1 1 1 1 1 1 12,000 2,999 2.500 1 1 1 1 1 1 13,000 3,999 3.511 2 2 2 2 2 2 24,000 4,999 4.460 2 2 2 2 2 2 25,000 5,999 5.457 2 2 2 2 2 2 26,000 6,999 6.475 2 2 2 2 2 2 27,000 7,999 7.460 1 1 1 1 1 1 18,000 8,999 8.556 2 2 2 2 2 2 29,000 9,999 9.455 2 2 2 2 2 2 2

10,000 14,999 12.462 4 4 4 4 4 4 415,000 19,999 17.341 3 3 3 3 3 3 320,000 24,999 21.965 3 3 3 3 3 3 325,000 29,999 27.331 3 3 3 3 3 3 330,000 34,999 31.800 1 1 1 1 1 1 135,000 39,999 38.129 1 1 1 1 1 1 140,000 44,999 43.325 1 1 1 1 1 1 145,000 49,999 47.780 2 2 2 2 2 2 250,000 54,999 52.743 1 1 1 1 1 1 155,000 59,999 56.160 1 1 1 1 1 1 160,000 64,999 61.700 1 1 1 1 1 1 165,000 69,999 66.454 2 2 2 2 2 2 270,000 74,999 73.200 1 1 1 1 1 1 175,000 79,999 77.167 1 1 1 1 1 1 180,000 84,999 81.922 2 2 2 2 2 2 285,000 89,999 88.433 1 1 1 1 1 1 190,000 9,999,999 180.037 9 9 9 9 9 9 9

Subtotal: 5315,000 19,999 16.143 1 1 1 1 1 1 120,000 24,999 22.750 1 1 1 1 1 1 130,000 34,999 30.800 1 1 1 1 1 1 135,000 39,999 38.333 1 1 1 1 1 1 140,000 44,999 41.833 1 1 1 1 1 1 190,000 9,999,999 323.032 5 5 5 5 5 5 5

Subtotal: 11

1" M

eter

s1

1/2"

Met

ers




ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.045 3 3 3 3 3 3 31,000 1,999 1.000 1 1 1 1 1 1 12,000 2,999 2.000 1 1 1 1 1 1 14,000 4,999 4.000 1 1 1 1 1 1 15,000 5,999 5.000 1 1 1 1 1 1 16,000 6,999 6.000 1 1 1 1 1 1 17,000 7,999 7.000 1 1 1 1 1 1 18,000 8,999 8.000 1 1 1 1 1 1 1

10,000 14,999 10.850 1 1 1 1 1 1 115,000 19,999 17.667 1 1 1 1 1 1 120,000 24,999 23.500 1 1 1 1 1 1 125,000 29,999 26.875 1 1 1 1 1 1 130,000 34,999 31.444 2 2 2 2 2 2 235,000 39,999 37.390 2 2 2 2 2 2 240,000 44,999 42.222 2 2 2 2 2 2 245,000 49,999 46.857 1 1 1 1 1 1 150,000 54,999 51.333 1 1 1 1 1 1 160,000 64,999 63.000 1 1 1 1 1 1 165,000 69,999 67.750 1 1 1 1 1 1 170,000 74,999 71.667 1 1 1 1 1 1 175,000 79,999 78.000 1 1 1 1 1 1 180,000 84,999 81.600 1 1 1 1 1 1 185,000 89,999 86.500 1 1 1 1 1 1 190,000 9,999,999 330.741 29 29 29 29 29 29 29

Subtotal: 5280,000 84,999 82.500 0 0 0 0 0 0 085,000 89,999 87.500 0 0 0 0 0 0 090,000 9,999,999 708.118 3 3 3 3 3 3 3

Subtotal: 30 999 0.500 0 0 0 0 0 0 0

1,000 1,999 1.500 0 0 0 0 0 0 090,000 9,999,999 5,045.000 0 0 0 0 0 0 0

Subtotal: 00 999 0.191 21 21 21 21 21 21 21

1,000 1,999 1.534 11 11 11 11 11 11 112,000 2,999 2.433 21 21 21 21 21 21 213,000 3,999 3.466 20 20 20 20 20 20 204,000 4,999 4.489 21 21 21 21 21 21 215,000 5,999 5.462 22 22 22 22 22 22 226,000 6,999 6.406 20 20 20 20 20 20 207,000 7,999 7.382 17 17 17 17 17 17 178,000 8,999 8.380 13 13 13 13 13 13 139,000 9,999 9.489 11 11 11 11 11 11 11

10,000 14,999 11.934 31 31 31 31 31 31 3115,000 19,999 16.973 6 6 6 6 6 6 620,000 24,999 21.556 2 2 2 2 2 2 225,000 29,999 27.667 1 1 1 1 1 1 1

Subtotal: 2160 999 314.358 1 1 1 1 1 1 1

1,000 1,999 02,000 2,999 03,000 3,999 0

Subtotal: 1Average for the Year 2,169

558 558 558 558 558 558 558Extra Service Units

2" M

eter

s3"

Met

ers

4" M

eter

sLo

ng H

ollo

w (5

/8" M

eter

s)Le

aks

and

Flus

hing

Rockbridge County PSAChart 16A - Rates During Test Year CBGreatRates© Version 5.2These charts show current rates, starting reserve balances and activity, and incomes for the test year.



Median or Actual Average use in 1,000 Gallons

Base Minimum Charge

Usage Allowance in

1,000 Gallons


Gallons0 999 0.000 $10.00 0.000 $0.00

1,000 1,999 0.000 $10.00 0.000 $0.00

0 999 0.189 $13.60 0.000 $4.141,000 1,999 1.452 $13.60 0.000 $4.142,000 2,999 2.465 $13.60 0.000 $4.14

90,000 9,999,999 180.319 $13.60 0.000 $4.14

0 999 0.059 $31.48 0.000 $4.141,000 1,999 1.186 $31.48 0.000 $4.14

90,000 9,999,999 180.037 $31.48 0.000 $4.14

0 999 0.500 $47.80 0.000 $4.141,000 1,999 1.000 $47.80 0.000 $4.142,000 2,999 2.000 $47.80 0.000 $4.14

90,000 9,999,999 323.032 $47.80 0.000 $4.14

0 999 0.045 $76.50 0.000 $4.141,000 1,999 1.000 $76.50 0.000 $4.142,000 2,999 2.000 $76.50 0.000 $4.14

90,000 9,999,999 330.741 $76.50 0.000 $4.14

0 999 0.500 $143.44 0.000 $4.141,000 1,999 1.500 $143.44 0.000 $4.142,000 2,999 2.500 $143.44 0.000 $4.14

90,000 9,999,999 708.118 $143.44 0.000 $4.14

0 999 0.500 $211.14 0.000 $4.141,000 1,999 1.500 $211.14 0.000 $4.142,000 2,999 2.500 $211.14 0.000 $4.14

90,000 9,999,999 5,045.000 $211.14 0.000 $4.14

0 999 0.191 $40.00 4.000 $8.001,000 1,999 1.534 $40.00 4.000 $8.002,000 2,999 2.433 $40.00 4.000 $8.00

90,000 9,999,999 115.200 $40.00 4.000 $8.00

0 999 314.358 $0.00 0.000 $0.001,000 1,999 0.000 $0.00 0.000 $0.002,000 2,999 0.000 $0.00 0.000 $0.00

Extra Service Units NA $0.00 NA NA

2" M

eter

sFi

relin

e5/

8" M

eter

s1"

Met

ers

1 1/

2" M

eter

s3"

Met

ers

4" M

eter

sLo

ng H

ollo

w

(5/8

" Met

ers)

Leak

s an

d Fl

ushi

ng

Rockbridge County PSAChart 16B - Reserves, AMHI CBGreatRates© Version 5.2

Reserve Starting Balances as of 7/1/09 and Debits and Credits*

$78,092 Cash & Cash Equivalents $161,191 Tank & Other

Replace Funds

$653,294 CIP Reserves


$45,803 AMHI for Rockbridge County PSA for the year 2009, by Census estimate

2.7% Historical rate of growth in AMHI for Rockbridge County PSA

Chart 16C - IncomesThis chart shows incomes for the test year.

Incomes for 7/1/09 Through 6/30/10

$929,511 Water & Fireline Sales

$13,228 Late Charges, Penalties

18 Number New Hookups$970,880

$388 Average New Hookup Fee

$6,975 Hookup Fee

$7,851 Interest$0

$0 Surcharge Fees

$90,060 Availability Fees

$6,243 Reconnection

$60 Trip Charges

$150 Inspection Charge

$3,540 Account Charge

$3,317 Misc & Bad Check Revenue

-$1,751 Bad Debt

$7,482 Lease-Glasgow Interconnection

$1,066,665 Total Regular Income

Predicted billable user fees:

Hookup Fee dedicated to cap improvements:

This chart shows starting reserve balances and activity not shown elsewhere and median household income for the test year.

Rockbridge County PSA, Water Rates Scenario 1Chart 17A - Equipment Replacement Details ChartThis schedule depicts detailed equipment replacement and refurbishment during the next 20 years.CBGreatRates© Version 5.2, Replacement Scheduler© Version 1.4

Year Beginning

Computer Equipment/Basic Software

Backflow Prevention, Then Meter

Replacement Fire Hydrants Telemetry Handhelds1" Gas Trash

PumpNB & AV

Well Pumps Weed Eater Pickup TruckPick Up

TruckPick Up

TruckPick Up

TruckPick Up

Truck

7/1/09 $1,000 $11,491 $0 $0 $0 $190 $0 $0 $8,717 $0 $0 $0 $0

7/1/10 $2,500 $17,400 $0 $10,500 $0 $0 $30,000 $0 $0 $0 $0 $0 $0

7/1/11 $1,000 $12,000 $0 $204,642 $0 $0 $0 $225 $0 $10,000 $0 $0 $0

7/1/12 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $10,000 $0 $0

7/1/13 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $0 $10,000 $0

7/1/14 $1,000 $12,000 $7,000 $0 $6,000 $190 $0 $0 $0 $0 $0 $0 $10,000

7/1/15 $1,000 $12,000 $7,000 $0 $0 $0 $30,000 $0 $10,000 $0 $0 $0 $0

7/1/16 $1,000 $12,000 $7,000 $0 $0 $0 $0 $225 $0 $0 $0 $0 $0

7/1/17 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $10,000 $0 $0 $0

7/1/18 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $10,000 $0 $0

7/1/19 $1,000 $12,000 $7,000 $0 $6,000 $190 $0 $0 $0 $0 $0 $10,000 $0

7/1/20 $1,000 $12,000 $7,000 $0 $0 $0 $30,000 $0 $0 $0 $0 $0 $10,000

7/1/21 $1,000 $12,000 $7,000 $0 $0 $0 $0 $225 $10,000 $0 $0 $0 $0

7/1/22 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/23 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $10,000 $0 $0 $0

7/1/24 $1,000 $12,000 $7,000 $0 $6,000 $190 $0 $0 $0 $0 $10,000 $0 $0

7/1/25 $1,000 $12,000 $7,000 $0 $0 $0 $30,000 $0 $0 $0 $0 $10,000 $0

7/1/26 $1,000 $12,000 $7,000 $0 $0 $0 $0 $225 $0 $0 $0 $0 $10,000

7/1/27 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $10,000 $0 $0 $0 $0

7/1/28 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/29 $1,000 $12,000 $7,000 $0 $6,000 $190 $0 $0 $0 $10,000 $0 $0 $0

7/1/30 $1,000 $12,000 $7,000 $0 $0 $0 $30,000 $0 $0 $0 $10,000 $0 $0

7/1/31 $1,000 $12,000 $7,000 $0 $0 $0 $0 $225 $0 $0 $0 $10,000 $0

7/1/32 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $10,000

7/1/33 $1,000 $12,000 $7,000 $0 $0 $0 $0 $0 $10,000 $0 $0 $0 $0

Replacement Scheduler Version 1.4, copyright 2008. The program itself may not be copied but report output may be so long as credit is ascribed to the developer, Carl E. Brown of Carl Brown Consulting, LLC.

Rockbridge County PSA, Water Rates Scenario 1Chart 17A - Equipment Replacement Details Chart

Year Beginning

Billing Software

Data Logger & Software

Accounting Software

Inventory Software

Gas Pipe Saw

AC Pipe Cutter

Electrical Panel

Appurten-ances

Leak Detection

Equipment Upgrade

Shop Upgrades

Well Bldgs, Pump

Stations, etc.Director's

Vehicle

7/1/09 $7,790 $0 $0 $0 $0 $1,874 $0 $0 $0 $0 $0 $0

7/1/10 $0 $0 $0 $0 $0 $0 $8,500 $0 $0 $0 $0 $12,500

7/1/11 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/12 $0 $5,000 $0 $0 $600 $0 $0 $0 $0 $0 $0 $0

7/1/13 $0 $0 $2,500 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/14 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/15 $0 $0 $0 $375 $0 $0 $0 $0 $0 $5,000 $5,000 $0

7/1/16 $7,790 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/17 $0 $0 $0 $0 $0 $0 $0 $5,525 $2,795 $0 $0 $0

7/1/18 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/19 $0 $5,000 $0 $0 $0 $1,874 $0 $0 $0 $0 $0 $0

7/1/20 $0 $0 $2,500 $0 $600 $0 $8,500 $0 $0 $0 $0 $12,500

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/22 $0 $0 $0 $375 $0 $0 $0 $0 $0 $0 $0 $0

7/1/23 $7,790 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/24 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/25 $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,000 $5,000 $0

7/1/26 $0 $5,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/27 $0 $0 $2,500 $0 $0 $0 $0 $5,525 $2,795 $0 $0 $0

7/1/28 $0 $0 $0 $0 $600 $0 $0 $0 $0 $0 $0 $0

7/1/29 $0 $0 $0 $375 $0 $1,874 $0 $0 $0 $0 $0 $0

7/1/30 $7,790 $0 $0 $0 $0 $0 $8,500 $0 $0 $0 $0 $12,500

7/1/31 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/32 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/33 $0 $5,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0


Year Beginning

Handheld Radios Dump Truck Backhoe

Small TLB Tractor

Air Compressor,

Jack Hammer, Bits Brush Hog Trailer

Portable Generator

Service Truck

Small Tool Generator

Phase3 PS Generator

FFTM #3 Generator

FFTM #1 Generator

7/1/09 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/10 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/11 $0 $0 $0 $20,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/12 $0 $0 $0 $0 $0 $0 $0 $16,500 $0 $300 $0 $0 $0

7/1/13 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $100,000 $0 $0

7/1/14 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/15 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/16 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/17 $2,850 $38,000 $0 $0 $0 $0 $4,350 $0 $0 $0 $0 $0 $0

7/1/18 $0 $0 $38,000 $0 $0 $1,500 $0 $0 $0 $0 $0 $100,000 $0

7/1/19 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $60,000

7/1/20 $0 $0 $0 $0 $11,200 $0 $0 $0 $0 $0 $0 $0 $0

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/22 $0 $0 $0 $0 $0 $0 $0 $0 $20,000 $0 $0 $0 $0

7/1/23 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/24 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/25 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/26 $0 $0 $0 $20,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/27 $2,850 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/28 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/29 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/30 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/31 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/32 $0 $38,000 $0 $0 $0 $0 $4,350 $16,500 $0 $300 $0 $0 $0

7/1/33 $0 $0 $38,000 $0 $0 $1,500 $0 $0 $0 $0 $100,000 $0 $0


Year Beginning

FFTM #2 Generator

Nlex PS Generator Welder

Sm Trench Box

Shoring Equipment

N Lee High Pressure Zone

Transfer Project

Adjustment to Balance

Total Annual Replacement

Costs

7/1/09 $0 $0 $0 $0 $0 $0 -$14,287 $0 $0 $0 $0 $0 $16,774

7/1/10 $0 $0 $0 $0 $0 $0 $86,550 $0 $0 $0 $0 $0 $167,950

7/1/11 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $247,867

7/1/12 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $52,400

7/1/13 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $132,500

7/1/14 $0 $0 $0 $2,500 $0 $0 $0 $0 $0 $0 $0 $0 $38,690

7/1/15 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $70,375

7/1/16 $0 $0 $0 $0 $0 $250,000 $0 $0 $0 $0 $0 $0 $278,015

7/1/17 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $83,520

7/1/18 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $169,500

7/1/19 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $103,063

7/1/20 $60,000 $0 $1,250 $0 $0 $0 $0 $0 $0 $0 $0 $0 $156,550

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $30,225

7/1/22 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $40,375

7/1/23 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $37,790

7/1/24 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $36,190

7/1/25 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $70,000

7/1/26 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $55,225

7/1/27 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $43,670

7/1/28 $0 $0 $0 $0 $1,750 $0 $0 $0 $0 $0 $0 $0 $22,350

7/1/29 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $38,438

7/1/30 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $88,790

7/1/31 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $30,225

7/1/32 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $89,150

7/1/33 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,500

Rockbridge County PSA, Water Rates Scenario 1Chart 17 - Replacement Schedule CBGreatRates© Version 5.2, Replacement Scheduler© Version 1.4

This schedule calculates the annual annuity to fund all replacement and refurbishment from the detailed schedule.4.00% Average Inflation Rate for the Following Water System Equipment for the Term of This Replacement Schedule 1.00% Average Interest Rate on Balances Invested for the Term of This Replacement Schedule 4.00% Average Interest Rate on Amounts Borrowed for the Term of This Replacement Schedule

Year Beginning Item Description

This Year's Costs in

Current Dollars

One-time Transfers From Operating Fund

One-time Transfers to

Operating Fund

End of Year Balance in Future

Dollars

Minimum Desired End of

Year Balance in Future Dollars

7/1/09 Test year replacements $16,774 $28,097 $0 $174,125 $187,469

7/1/10 Total of replacements from detailed replacement schedule $167,950 $26,385 $0 $169,115 $194,968

7/1/11 Total of replacements from detailed replacement schedule $247,867 $0 $0 $43,189 $202,767







7/1/18 Total of replacements from detailed replacement schedule $169,500 $0 $0 -$36,479 $266,827












Starting Account Balance $161,191 $187,469

Minimum Annual Annuity $121,476

Discretionary Annuity $19,000

Required Annual Deposit to Replacement Account $140,476

Minimum Desired Balance in Today's

Dollars

Notes: This schedule summarizes equipment replacements detailed in Chart 17A.The minimum desired balance is twice the average annual replacement cost amount. The required annual deposit was calculated based upon these assumptions.

Rockbridge County PSAChart 18 - All-in Test Year Costs and Rate Structure Calculations CBGreatRates© Version 5.2

Operating Costs

Item Amount

% of This Cost

That is Fixed

% of This Cost

That is Variable

Total Costs After

Adjustment for Special Costs

Below

Fixed Costs After

Adjustment for Extra

Service Unit Costs

Variable Costs

Extra Service Unit Costs, if

Applicable, From Chart

18B

Administration Salaries, Benefits, etc. $126,890 100.0% 0.0% $126,890 $124,294 $0 $2,597

Operations Salaries, Benefits, etc. $121,361 25.0% 75.0% $121,361 $24,132 $91,021 $6,209

Licenses & Permits $4,568 100.0% 0.0% $4,568 $3,633 $0 $935

Maintenance of Wells $739 0.0% 100.0% $739 $0 $739 $0

Purchased Water $418,027 0.0% 100.0% $418,027 $0 $418,027 $0

O&M Water Pump Sta. Equip. $2,256 0.0% 100.0% $2,256 $0 $2,256 $0

Power for Pumping Water $42,812 0.0% 100.0% $42,812 $0 $42,812 $0

O&M of Water Buildings $247 25.0% 75.0% $247 $49 $186 $13

O&M W Treatment Equipment $1,283 25.0% 75.0% $1,283 $255 $962 $66

Water Treatment Supplies & Expenses $2,704 0.0% 100.0% $2,704 $0 $2,704 $0

Sampling/Analysis $4,399 100.0% 0.0% $4,399 $3,499 $0 $900

Maintenance of Water Tanks $3,578 25.0% 75.0% $3,578 $711 $2,683 $183

Maintenance of Mains & Accessories $2,292 25.0% 75.0% $2,292 $456 $1,719 $117

Water Services $3,420 25.0% 75.0% $3,420 $855 $2,565 $0

Maintenance of Large Meters $1,696 0.0% 100.0% $1,696 $0 $1,696 $0

Maintenance of Hydrants $2,754 25.0% 75.0% $2,754 $548 $2,065 $141

Bank Service Charge-W $263 100.0% 0.0% $263 $258 $0 $5

Uncollected Water Expenses $3,145 25.0% 75.0% $3,145 $786 $2,359 $0

Office Supplies & Software $3,623 100.0% 0.0% $3,623 $3,549 $0 $74

Financial, Legal, Payroll Contract $5,065 100.0% 0.0% $5,065 $4,961 $0 $104

Insurance Premiums-W $8,620 100.0% 0.0% $8,620 $8,443 $0 $176

Transportation (Vehicles)-W $6,593 25.0% 75.0% $6,593 $1,615 $4,945 $34

Board Members Comp/Travel-W $1,205 100.0% 0.0% $1,205 $959 $0 $247

Uniform Rental, Dues, Subscrip, Training, Misc $2,973 25.0% 75.0% $2,973 $591 $2,230 $152

O&M of General Equip/Property-W $5,963 25.0% 75.0% $5,963 $1,186 $4,472 $305

Telephone, Pager $2,229 100.0% 0.0% $2,229 $1,773 $0 $456

Postage-W $3,412 100.0% 0.0% $3,412 $2,713 $0 $698

Outside Services-Mowing-W $8,294 100.0% 0.0% $8,294 $6,596 $0 $1,697

Engineering-Nonconstruction-W $2,000 25.0% 75.0% $2,000 $398 $1,500 $102

Engineering-Billed by PSA-W $725 25.0% 75.0% $725 $144 $544 $37

Amort of Interest, Admin for Construction $3,141 25.0% 75.0% $3,141 $625 $2,356 $161

One-time Pmt Adj to Tank & Other Replace Funds $28,097 25.0% 75.0% $28,097 $7,024 $21,073 $0

Annual Payment to Tank & Other Replace Funds $140,476 25.0% 75.0% $140,476 $35,119 $105,357 $0

User Charge Analysis Services $0 100.0% 0.0% $0 $0 $0 $0

Debt Service $76,478 50.0% 50.0% $76,478 $37,456 $38,239 $782

Grand Total All Costs $1,041,326 $1,041,326 $272,628 $752,508 $16,191

Cost Calculations for "Proportional" Rates $1,041,326

Fixed Cost/User Every Other Month = $22.19$0

11%

Percentage of Water Loss to Allocate to Fixed Costs is 0%

41%

$17,062

Test Year Usage Metered Through Customer Meters 190,511,630 Gallons

+ Test Year Water Loss 24,366,244 Gallons

= Total Test Year Volume 214,877,874 Gallons

Surchargeable Services are Estimated at

Water Loss is Estimated at

As Compared to Service Sold, the Relative Cost of Water Loss is Estimated at

Resulting Cost of Water Loss

This chart depicts all costs for the test year and distributes those costs to fixed and variable categories for the purpose of calculating the "proportional to use" rate structure (see Definitions).

Variable Costs (Cost to Produce)/1,000 Gallons Sold = $3.95

Gallons/Billing Cycle Used by Average General Customer = 7,400

Rockbridge County PSAChart 18B - Test Year Extra Service Unit Costs CBGreatRates© Version 5.2

Item

Fixed Costs After

Adjustment for Special

Costs (From Chart 18)

Proportional Benefit that Accrues to

Extra Service Units*

% That Extra Service Units are of Total # of Customers

% of This Cost to

Charge to Extra Service

UnitsExtra Service

Unit CostsAdministration Salaries, Benefits, etc. $126,890 10.0% 20.5% 100.0% $2,597

Operations Salaries, Benefits, etc. $30,340 100.0% 20.5% 100.0% $6,209

Licenses & Permits $4,568 100.0% 20.5% 100.0% $935

Maintenance of Wells $0 100.0% 20.5% 100.0% $0

Purchased Water $0 100.0% 20.5% 100.0% $0

O&M Water Pump Sta. Equip. $0 100.0% 20.5% 100.0% $0

Power for Pumping Water $0 100.0% 20.5% 100.0% $0

O&M of Water Buildings $62 100.0% 20.5% 100.0% $13

O&M W Treatment Equipment $321 100.0% 20.5% 100.0% $66

Water Treatment Supplies & Expenses $0 100.0% 20.5% 100.0% $0

Sampling/Analysis $4,399 100.0% 20.5% 100.0% $900

Maintenance of Water Tanks $894 100.0% 20.5% 100.0% $183

Maintenance of Mains & Accessories $573 100.0% 20.5% 100.0% $117

Water Services $855 0.0% 20.5% 100.0% $0

Maintenance of Large Meters $0 100.0% 20.5% 100.0% $0

Maintenance of Hydrants $688 100.0% 20.5% 100.0% $141

Repair & Replacement Expense-W $0 100.0% 20.5% 100.0% $0

Bank Service Charge-W $263 10.0% 20.5% 100.0% $5

Uncollected Water Expenses $786 0.0% 20.5% 100.0% $0

Office Supplies & Software $3,623 10.0% 20.5% 100.0% $74

Financial, Legal, Payroll Contract $5,065 10.0% 20.5% 100.0% $104

Insurance Premiums-W $8,620 10.0% 20.5% 100.0% $176

Transportation (Vehicles)-W $1,648 10.0% 20.5% 100.0% $34

Board Members Comp/Travel-W $1,205 100.0% 20.5% 100.0% $247

Uniform Rental, Dues, Subscrip, Training, Misc $743 100.0% 20.5% 100.0% $152

O&M of General Equip/Property-W $1,491 100.0% 20.5% 100.0% $305

Telephone, Pager $2,229 100.0% 20.5% 100.0% $456

Postage-W $3,412 100.0% 20.5% 100.0% $698

Outside Services-Mowing-W $8,294 100.0% 20.5% 100.0% $1,697

Engineering-Nonconstruction-W $500 100.0% 20.5% 100.0% $102

Engineering-Billed by PSA-W $181 100.0% 20.5% 100.0% $37

Amort of Interest, Admin for Construction $785 100.0% 20.5% 100.0% $161

Annual Payment to Tank & Other Replace Funds $35,119 0.0% 20.5% 100.0% $0

User Charge Analysis Services $0 0.0% 20.5% 100.0% $0

Debt Service $38,239 10.0% 20.5% 100.0% $782Grand Total All Costs $288,818 $16,191

As compared to fixed costs, extra service unit costs accrue at the following average rate: 21.8%

Resulting Cost/Service Unit Every Other Month: $4.84

This chart depicts costs that extra service units cause the system to incur. Such units are commonly apartments within an apartment complex where only the owner is billed for service, mobile homes within a mobile home park where only the park operator is billed, shops within a stip mall where only the mall operator is billed, etc.

* Compared to customers of record, extra service units get this percentage of benefit out of each of these cost items.

(This is the dollar benefit a single service unit receives from these fixed costs.)








[email protected]




Rockbridge County PSA, Water Rates Scenario 2Chart 1 - Proposed Rate Chart CBGreatRates© Version 5.2







Gallons0 999 $11.50 0.000 $0.00

1,000 1,999 $11.50 0.000 $0.00 90,000 9,999,999 $11.50 0.000 $0.00

0 999 $19.46 0.000 $4.40 1,000 1,999 $19.46 0.000 $4.40 2,000 2,999 $19.46 0.000 $4.40

90,000 9,999,999 $19.46 0.000 $4.400 999 $42.26 0.000 $4.40

1,000 1,999 $42.26 0.000 $4.40 90,000 9,999,999 $42.26 0.000 $4.40

0 999 $71.91 0.000 $4.40 1,000 1,999 $71.91 0.000 $4.40 2,000 2,999 $71.91 0.000 $4.40

90,000 9,999,999 $71.91 0.000 $4.400 999 $113.43 0.000 $4.40

1,000 1,999 $113.43 0.000 $4.40 2,000 2,999 $113.43 0.000 $4.40

90,000 9,999,999 $113.43 0.000 $4.400 999 $232.04 0.000 $4.40

1,000 1,999 $232.04 0.000 $4.40 2,000 2,999 $232.04 0.000 $4.40

90,000 9,999,999 $232.04 0.000 $4.400 999 $398.10 0.000 $4.40

1,000 1,999 $398.10 0.000 $4.40 2,000 2,999 $398.10 0.000 $4.40

90,000 9,999,999 $398.10 0.000 $4.400 999 $52.50 4.000 $8.26

1,000 1,999 $52.50 4.000 $8.26 2,000 2,999 $52.50 4.000 $8.26

90,000 9,999,999 $52.50 4.000 $8.260 999 $0.00 0.000 $0.00

1,000 1,999 $0.00 0.000 $0.00 90,000 9,999,999 $0.00 0.000 $0.00

Extra Service Units $0.00 0.000 $0.00Note: Rates for volume classes not shown are the same as adjacent rates. Fireline rates are a simple flat rate.

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Rockbridge County PSA, Sewer Rates Scenario 1







[email protected]




Name What Each is or Does

Definitions The meaning of terms used in this report and in rate setting generally

Financial Highlights A summary of financial outcomes produced by the proposed rates

Chart 1 - Proposed Rate Chart User rates proposed in this model for each user class

Chart 2A - User Base and Operating Incomes

Basic user base and user rate statistics and operating revenues projected for next 10 years

Chart 2B - Operating Costs and Net Income

Operating costs projected for next 10 years, excluding debt service


If applicable to this analysis, a calculation of surcharges to apply to minimum charges, based upon meter size or similar criteria, that will recoup part or all of the costs incurred to provide high-flow capacity.

Chart 3 - Capital Improvement Program Capital improvements and how they will be paid over next 10 years, including debt service

Chart 4A - Rate Adjustments and Incomes for Modeling Year

Current rates, proposed rates and the blended revenues they will produce during the year rates are adjusted

Chart 4B - Rate Statistics Effects of proposed rates on user classes and special users

Chart 5 - Indicators Financial results that proposed rates and projected operating and capital costs will

Chart 6 - Operating Ratio Graph of operating ratio for next 10 years

Chart 7 - Coverage Ratio Graph of coverage ratio for next 10 years

Chart 8 - 5,000 Gallon Residential User's Bill

Graph of bill for a 5,000 gallon per month residential user for next 10 years (used in grant and loan eligibility determinations)

Chart 9 - Affordability Index Graph of affordability index of residential user's bill for next 10 years (used in grant and loan eligibility determinations)

Chart 10 - Working Capital Graph of working capital for next 10 years

Chart 11 - Working Capital and CIP Reserves Discounted for Inflation

Graph of working capital and CIP (capital improvement program) reserves adjusted for inflation for next 10 years

Chart 12 - Current Position Graph of current position for next 10 years

Chart 13 - Residential Use and Revenues Graph of usage vs. revenues for next 10 years for single family residential users

Chart 13B - Residential Use and Revenues

Graph of usage vs. revenues for next 10 years for all users except single family residential

Chart 13C - Tap Fee Reserve Balance Balance of tap fees reserved for CIP for next 10 years, if applicable

Chart 14 - Old Rates, New Rates and Changes

Illustrates effects of proposed user rates on ratepayers (increases or decreases)

Chart 15 - Test Year Usage Volume of service used by customers during the test year

Chart 16A - Rates During Test Year The test year (current) user rate chart

Chart 16B - Reserves, AMHI Reserves available at the start of the test year and incomes received during the test year

Chart 17A - Equipment Replacement Details Chart

Detailed schedule of equipment replacements for next 20 years

Chart 17 - Replacement Schedule Calculation of the annual annuity (yearly savings amount) needed to pay for all equipment replacements as they come due

Chart 18 - All-in Test Year Costs and Rate Structure Calculations

Sumation of test year system costs and calculation of "proportional to use" cost recovery rates for fixed cost and variable cost (cost to produce)

Chart 18B - Test Year Extra Service Unit Costs

If applicable to this analysis, cost of providing service to units such as apartments and mobile homes when they are not billed separately.

Rockbridge County PSA, Sewer Rates Scenario 1Index of Charts and Other Results

DefinitionsCBGreatRates© Version 5.2

Affordability Index The monthly charge for (typically) 5,000 gallons of residential service divided by the median monthly household income for the area served by the system. An index of 1.0, meaning a household pays one percent of its income to pay its bill for 5,000 gallons of service, is generally considered affordable. Affordability index is a primary factor in determining grant and loan eligibility and grant amount.

Capacity Charge, also commonly called an ‘Impact Fee’ or ‘Availability Charge’

A charge that buys a new customer system capacity. This is a charge levied on a new customer that recovers all or part of the capital costs to build capacity to be able to serve that customer’s actual or potential demand. This charge may be a few thousand dollars for a residential customer to many thousands of dollars for a large industrial customer.

Capital Improvement Plan or Program (CIP)

A listing of anticipated capital improvements. These are the more expensive items such as water towers, treatment plants and lines, that generally require bond or grant funding. They do not include equipment replacement items.

Capital Improvement Reserves

Cash reserves dedicated to funding the CIP

Comprehensive Rate Analysis

A thorough examination of a system’s operating, capital improvement, equipment replacement and all other costs, revenues, current rates, number of users and their use of the system, growth rates and all other issues surrounding the system. This examination will determine how rates and fees should be set in the future to cash-flow the system properly, to build appropriate reserves and to be fair the ratepayers. It also will determine how policies should be adjusted to enable the system to operate well now, operate well in the medium-range future (about 10 years) and prepare for expected and expectable events such as capital improvements and equipment replacement.

Connection Charge A charge that buys a new customer connection to the system. This charge is levied on a new customer to recover all or part of the costs a system incurs in the course of connecting the new customer to the system. This may include labor costs for staff or others on-site; equipment sold by the system to the new customer for making the connection; equipment, tools and supplies used by system staff for making the connection; and the like. This charge may be a few hundred dollars for a residential customer to thousands of dollars for a large industrial customer.

Conservation (Inclining) Rates

Unit charges that go up as the volume used goes up

Cost to Produce There are several ways to define cost to produce. Each is acceptable for different purposes. Generally, cost to produce is the total of all variable costs required to get service to a utility’s customers during one year divided by the total units of service delivered during that year. In a proportional to use rate structure, this will be the variable cost. See "Cost Calculations" at the bottom of Chart 18.

Cost to Serve Rates Rates where fixed and variable costs generated by each user class are paid by that class with minimum and unit charges, respectively.

Coverage Ratio (CR) Incomes and reserves available to pay debt divided by the amount of the debt for that year. Most systems should have a CR of 1.25 or higher.

Current Position For a year, the sum of all incomes and undedicated reserves minus all current financial obligations for that year. Future obligations (next year’s loan payments) and depreciation are not included. Current position is a good measure of overall financial health.

Declining Rates Rates where unit charges go down as the volume used goes up

Flat Rates Rates where all users pay exactly the same fee regardless of the volume of service they use

Equivalent Dwelling Unit (EDU)

Based upon number of water using fixtures, average flow, potential flow or similar criteria, the service consumption rate of the average single family home is rated at one EDU. All other types of customers are then compared on this measuring basis and the EDUs are calculated. Generally the purpose of this exercise is to calculate fees that each EDU must pay.

Extra Service Unit A refinement of the EDU system used to asssess a surcharge for each living or business unit within a multiple unit facility; apartments in an apartment complex, shops in a strip mall or a motel rooms in a

Extra Service Unit Costs Incremental costs incurred, importantly including debt service, to provide service to extra service units. In systems with few extra service units or little debt service, these costs are usually negligible.

Incremental Rate Adjustments

Rate increases done, generally annually, following the initial rate adjustment. The goal of these rate increases is to keep the system’s income and reserve levels on track. Rate structure fairness is a small issue, if it is an issue at all. Such increases are usually small, in the two to five percent per year range.

Initial Rate Adjustments Rate adjustments done in follow up to the comprehensive rate analysis. Generally, the goal of such adjustments is to establish rates that put the system’s income and reserve levels on track with the system’s financial needs and do it with a structure that is fair to the ratepayers.

Inflow & Infiltration (I&I) In a sewer system, water that gets into the collection system by way of illicit connections (inflow) such as gutter downspouts and leaks in manholes and sewer lines (infiltration)

Infrastructure Hard assets, such as water towers, treatment plants and lines needed to provide service to customers connected to the system

Life-cycle Cost The total cost to design, build, operate, maintain and eventually dispose of an asset. One asset may cost less to build but be more expensive to operate and maintain, yielding a higher life-cycle cost.

Operating Costs Definitions vary. For rate setting purposes operating costs are costs incurred because a system is owned and operated. Such costs are generally recovered through user fees.

Operating Revenues Revenues generated by user fees

Operating Ratio (OR) Current incomes and undedicated reserves minus current expenses, not including debt. An OR of 1.0 is "break even." Most systems should have an OR of 1.25 or higher.

Payback Period Time required for the investment made to get this analysis to return that investment through increased user and other fees

Potential Demand The volume of service that a user could demand for a short period of time at full volume use. The potential demand limiting factor is usually the size of the customer's meter or service line.

Proportional to Use Rates Rates where the minimum charge recovers all fixed costs, the unit charge recovers all variable costs, the unit charge is the same for all volume sold, and there is no usage allowance in the minimum charge.

Replacement Schedule A timetable that describes equipment replacement and important repairs that are too infrequent and/or too expensive to cover as annual operating costs but not so expensive that they need to be covered as capital improvements.

Replacement Reserves Cash reserves used to fund the Replacement Schedule

Return on Investment The dollar amount or percentage of revenue gain enabled by this analysis

Tap Fee, also called a "Hook up Fee"

A charge that gives a new customer the right to connect to the system. This fee may include the costs of administering the connection program, such as staff time to ‘sign up’ new customers, get them into the system’s billing program, do an inspection of the service connection to assure that it meets the system’s standards and the like. This charge is usually minimal for a residential customer and maybe a few thousand dollars for a large industrial customer. Capacity and connection fees are commonly added to tap fees and the total fee is just called a 'tap' fee.

Test Year The one year period from which data was gathered to be the basis of the rate analysis

Usage Allowance The volume, if any, that is "given away" with the minimum charge. Most systems give away no volume. Those that give away an unlimited volume have what are called "flat rates."

User Fee, User Charge, User Rates

Fees assessed to customers for use of the system. Does not include tap, capacity or connection fees, late payment penalties or other types of charges.

Water Loss Measured by volume or percent, the part of a water system's net water production that does not get to customers. This loss also includes billable volume lost due to under-registering customer meters.

Working Capital or Net Income

The amount left in the operating fund after paying all costs due during that month, year or other time period. Working capital of $0 is "break even."

Working Capital Goal The desired percentage above "break even" for the operating fund. Small systems (a few hundred connections) generally should target 35 percent or greater. Larger systems can target less, down to a minimum of about 20 percent for systems with 5,000 or more connections but the goal for each system should be based upon the needs of that system.

Rockbridge County PSA, Sewer Rates Scenario 1Financial Highlights CBGreatRates© Version 5.2

6/30/10 6/30/11 6/30/15 6/30/20Rate revenues collected $963,451 $1,016,119 $1,513,330 $2,057,865Sum of incomes $1,068,238 $1,080,608 $1,620,608 $2,181,676Sum of operating costs $740,597 $866,359 $1,215,770 $1,536,527Net income gain or loss ( - ) $327,642 $214,248 $404,839 $645,149Capital improvement reserves $74,187 $141,179 $305,983 $95,294Replacement reserves $446,357 $458,251 $508,825 $603,691Current position* $370,298 $433,180 $607,885 $768,264*All current incomes plus reserves minus all current obligations

Increase or decrease ( - ) in total assets, excluding hard assets, due to this analysis N.A. -$13,197 $1,338,113 $4,687,584

Return on Investment and Payback Period CalculationsReturn on investment due to this analysis, projected one and five years into the future N.A. -277% 28112%

Payback period, in days, made possible by this analysis 6

Return rate and payback period are based upon the following investments:

Fees to Carl Brown Consulting $4,260

Estimated value of city staff time and incidentals to assemble needed information $500

Total Investment $4,760

This analysis was produced using the program CBGreatRates, copyright 2010. You are encouraged to distribute this report so long as credit is ascribed to the author, Carl E. Brown of Carl Brown Consulting, LLC.

Results for Years Ending on

This analysis package examines a "proposed rates scenario" that depicts what will happen under the adjusted rates and other changes recommended for the system. The results of this scenario are compared to the results you can expect if you do not adjust rates at all during the 10 years following the test year.

In the following table you can see several key financial benchmarks made possible by the proposed rates. The first column below is the test year, the year from which historical data was used to build the model. The second is the year following the test year - the year during which initial rate adjustments (typically) go into effect. The last two columns are the fifth and tenth years following the test year.

With the exception of tables that depict test year data, all other tables and charts depict the financial performance made possible by the modeled rate changes. The easiest way to grasp the financial future of the system is to view the line graphs. Another table shows the bills your users are paying now compared to the bills they would pay under the proposed rates scenario.

Rockbridge County PSA, Sewer Rates Scenario 1Chart 1 - Proposed Rate Chart CBGreatRates© Version 5.2







Gallons0 999 $122.25 0.000 $0.00

1,000 1,999 $122.25 0.000 $0.00 2,000 2,999 $122.25 0.000 $0.00

90,000 9,999,999 $122.25 0.000 $0.000 999 $29.43 0.000 $7.74

1,000 1,999 $29.43 0.000 $7.74 2,000 2,999 $29.43 0.000 $7.74

90,000 9,999,999 $29.43 0.000 $7.740 999 $61.01 0.000 $7.74

1,000 1,999 $61.01 0.000 $7.74 90,000 9,999,999 $61.01 0.000 $7.74

0 999 $102.08 0.000 $7.74 1,000 1,999 $102.08 0.000 $7.74 2,000 2,999 $102.08 0.000 $7.74

90,000 9,999,999 $102.08 0.000 $7.740 999 $159.58 0.000 $7.74

1,000 1,999 $159.58 0.000 $7.74 2,000 2,999 $159.58 0.000 $7.74

90,000 9,999,999 $159.58 0.000 $7.740 999 $323.88 0.000 $7.74

1,000 1,999 $323.88 0.000 $7.74 2,000 2,999 $323.88 0.000 $7.74

90,000 9,999,999 $323.88 0.000 $7.740 999 $553.90 0.000 $7.74

1,000 1,999 $553.90 0.000 $7.74 2,000 2,999 $553.90 0.000 $7.74

90,000 9,999,999 $553.90 0.000 $7.740 999 $4.90 0.000 $80.00

1,000 1,999 $4.90 0.000 $80.00 2,000 2,999 $4.90 0.000 $80.00

90,000 9,999,999 $4.90 0.000 $80.000 999 $4.90 0.000 $100.00

1,000 1,999 $4.90 0.000 $100.00 2,000 2,999 $4.90 0.000 $100.00

90,000 9,999,999 $4.90 0.000 $100.00Extra Service Units $6.30 0.000 $0.00Note: Rates for volume classes not shown are the same as adjacent rates.

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Rockbridge County PSA, Sewer Rates Scenario 1 CBGreatRates© Version 5.2

Chart 2A - User Base and Operating Incomes This chart depicts incomes during the test year, this year and for the next 10 years.

Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting

7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

User BaseNA 946 959 972 982 997 1017 1039 1063 1087 1111 1136

NA 13 13 10 15 20 23 23 24 24 25 26

NA 1.37% 1.37% 1.00% 1.50% 2.00% 2.25% 2.25% 2.25% 2.25% 2.25% 2.25%

NA NA 20.6% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%

NA NA $29.43 $30.61 $31.83 $33.10 $34.43 $35.81 $37.24 $38.73 $40.28 $41.89

NA NA $7.74 $8.04 $8.37 $8.70 $9.05 $9.41 $9.79 $10.18 $10.59 $11.01

Operating Incomes

Sewer and Septage Sales NA $963,451 $1,016,119 $1,286,607 $1,351,452 $1,426,593 $1,513,330 $1,609,275 $1,711,303 $1,819,799 $1,935,175 $2,057,865

Late Charges, Penalties NA $9,879 $7,040 $8,914 $9,363 $9,884 $10,485 $11,150 $11,856 $12,608 $13,408 $14,258

Hookup Fee % Above $2,744 $2,782 $2,134 $3,363 $4,733 $5,648 $6,006 $6,387 $6,792 $7,223 $7,681

Interest NA $6,355 $1,851 $2,166 $2,670 $2,780 $2,916 $3,039 $3,181 $3,344 $3,488 $3,653

Availability Fees NA $80,150 $49,216 $35,963 $54,484 $73,735 $84,611 $86,515 $88,461 $90,452 $92,487 $94,568

Reconnection NA $1,293 $912 $912 $912 $912 $912 $912 $912 $912 $912 $912

Inspection Charge NA $188 $50 $50 $50 $50 $50 $50 $50 $50 $50 $50

Account Charge NA $2,340 $2,700 $2,700 $2,700 $2,700 $2,700 $2,700 $2,700 $2,700 $2,700 $2,700

Misc & Bad Check Revenue NA $1,978 $75 $79 $83 $88 $94 $100 $106 $113 $120 $128

Bad Debt NA -$138 -$138 -$138 -$138 -$138 -$138 -$138 -$138 -$138 -$138 -$138

Total Regular Income $1,068,238 $1,080,608 $1,339,387 $1,424,939 $1,521,337 $1,620,608 $1,719,609 $1,824,820 $1,936,632 $2,055,424 $2,181,676

(First year balances and incomes are actual, subsequent years are projected.)


Factor

Adjusted, Then Annually Readjusted Unit Charge/Billable Volume Unit for Uniform Rates Only

Adjusted, Then Annually Readjusted Minimum Charge/Billing Period for Uniform Rates Only

Average Users for the Year

Users Added/Lost During the Year

User Growth/Loss Rate

Rate Increases Initiated in Future Years


Chart 2B - Operating Costs and Net Income This chart depicts expenses during the test year, this year and for the next 10 years.

Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

(Note: Some future costs will experience inflation. Those costs that go up as use goes up are also increased by the growth rate in users and the percentage by which that cost is variable as reported in Chart 4.)

Administration Salaries, Benefits, etc. 5.0% $66,481 $71,201 $74,761 $78,499 $82,424 $86,546 $90,873 $95,417 $100,187 $105,197 $110,457

Operations Salaries, Benefits, etc. 5.0% $120,206 $128,741 $135,178 $141,937 $149,034 $156,486 $164,310 $172,525 $181,152 $190,209 $199,720

Licenses & Permits 2.0% $218 $25 $26 $26 $27 $27 $28 $28 $29 $29 $30

Maintenance of Sewer Mains 3.0% $2,355 $4,000 $4,120 $4,244 $4,371 $4,502 $4,637 $4,776 $4,919 $5,067 $5,219

Sewage Treatment by Contract Varies $457,079 $516,391 $625,866 $654,311 $687,419 $723,973 $762,470 $803,015 $845,715 $890,686 $938,048

O&M Sewer Pumping Equip 3.0% $5,808 $4,000 $4,120 $4,244 $4,371 $4,502 $4,637 $4,776 $4,919 $5,067 $5,219

Power for Pumping Sewer 5.0% $13,086 $17,500 $18,375 $19,294 $20,258 $21,271 $22,335 $23,452 $24,624 $25,855 $27,148

O&M of Sewer Buildings 3.0% $96 $500 $515 $530 $546 $563 $580 $597 $615 $633 $652

Sewage Chem. Supplies & Exp. 5.0% $5,971 $5,300 $5,565 $5,843 $6,135 $6,442 $6,764 $7,103 $7,458 $7,831 $8,222

Sewer Services 3.0% $2,157 $2,000 $2,060 $2,122 $2,185 $2,251 $2,319 $2,388 $2,460 $2,534 $2,610

Maintenance of Meters 3.0% $887 $2,060 $2,122 $2,185 $2,251 $2,319 $2,388 $2,460 $2,534 $2,610 $2,688

Bank Service Charge-S 3.0% $204 $46 $47 $49 $50 $52 $53 $55 $57 $58 $60

Uncollected Sewer Expenses 3.0% $2,309 $920 $948 $976 $1,005 $1,035 $1,067 $1,099 $1,131 $1,165 $1,200

Office Supplies, Software, Phone, Pager 3.0% $4,489 $8,753 $9,015 $9,286 $9,564 $9,851 $10,147 $10,451 $10,765 $11,088 $11,420

Financial, Legal, Payroll Contract 5.0% $468 $5,305 $5,570 $5,848 $6,141 $6,448 $6,770 $7,109 $7,464 $7,837 $8,229

Insurance Premiums-S 5.0% $7,052 $6,330 $6,646 $6,978 $7,327 $7,694 $8,078 $8,482 $8,906 $9,352 $9,819

Transportation (Vehicles)-S 3.0% $5,395 $8,223 $8,470 $8,724 $8,985 $9,255 $9,533 $9,819 $10,113 $10,417 $10,729

Board Members Comp/Travel-S 3.0% $986 $1,377 $1,419 $1,461 $1,505 $1,550 $1,597 $1,644 $1,694 $1,745 $1,797

Uniform Rental, Dues, Subscrip, Training, Misc 5.0% $1,744 $5,924 $6,220 $6,531 $6,858 $7,200 $7,561 $7,939 $8,335 $8,752 $9,190

O&M of General Equip/Prop-S 3.0% $5,945 $6,969 $7,178 $7,393 $7,615 $7,844 $8,079 $8,321 $8,571 $8,828 $9,093

Postage-S 5.0% $2,463 $2,530 $2,657 $2,789 $2,929 $3,075 $3,229 $3,390 $3,560 $3,738 $3,925

Outside Services-Mowing-S 3.0% $3,060 $3,750 $3,863 $3,978 $4,098 $4,221 $4,347 $4,478 $4,612 $4,750 $4,893

Engineering-Nonconstruction-S 5.0% $0 $5,000 $5,250 $5,513 $5,788 $6,078 $6,381 $6,700 $7,036 $7,387 $7,757

One-time Transfer to Replacement Funds 0.0% $32,135 $30,742 $0 $0 $0 $0 $0 $0 $0 $0 $0

Annual Payment to Replacement Funds 0.0% $108,347 $108,347 $108,347 $108,347 $108,347 $108,347 $108,347 $108,347 $108,347 $108,347 $108,347

User Charge Analysis Services 5.0% $0 $4,260 $0 $0 $4,697 $0 $0 $5,178 $0 $0 $5,709

Debt Service 0.0% CIP CIP CIP CIP CIP CIP CIP CIP CIP CIP CIP

Outside Services-Other 5.0% $0 $690 $725 $761 $799 $839 $881 $925 $971 $1,019 $1,070

Septage Treatment Expense Varies $0 $23,823 $28,874 $30,186 $31,714 $33,400 $35,176 $37,047 $39,017 $41,091 $43,276

Adjustment to Replacement Payment NA -$108,347 -$108,347 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Costs $740,597 $866,359 $1,067,934 $1,112,056 $1,166,445 $1,215,770 $1,272,586 $1,337,520 $1,395,190 $1,461,293 $1,536,527

Net Income (or Loss) $327,642 $214,248 $271,453 $312,883 $354,893 $404,839 $447,023 $487,300 $541,442 $594,131 $645,149

Working Capital Goal: 50% In Dollars, That is: $370,298 $433,180 $533,967 $556,028 $583,222 $607,885 $636,293 $668,760 $697,595 $730,646 $768,264


Factor

(First year costs and net incomes are actual, subsequent years are projected.)

Rockbridge County PSA, Sewer Rates Scenario 1 CBGreatRates© Version 5.2Chart 3 - Capital Improvement Program This chart depicts the capital improvements needed for the next 10 years and how they will be paid for. Costs reflect inflation.

This Year Next Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year 9th Year 10th YearYear Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting Year Starting

CIP Spending Plan 7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

Capital Improvements to be Paid With Debt

Raphine/Fairfield Sewer $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Rt 60/I81 Ext. $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Capital Improvements to be Paid With Debt $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Capital Improvements to be Paid With Cash

Raphine/Fairfield Sewer $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Rt 60/I81 Ext. $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Cap Imprvmts to be Paid With Cash $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total CIP Planned Spending $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

CIP Funding Plan

CIP & Debt Reserves Carryover Plus Transfers in $454,442 $225,554 $311,845 $451,739 $561,486 $657,217 $724,598 $761,264 $788,486 $796,654 $783,648

CIP & Debt Reserves Interest Earned (or Paid) $0 $742 $1,412 $1,609 $2,338 $2,770 $3,060 $3,064 $2,759 $2,356 $1,761

County Loan, Net Assistance From County $309,862 $605,000 $537,778 $470,556 $403,334 $336,112 $268,890 $201,668 $134,446 $67,224 $2

Total CIP Fund Sources $764,304 $831,296 $851,034 $923,905 $967,158 $996,100 $996,548 $965,996 $925,691 $866,234 $785,411

New Debt Payment Plan Payments for future loans assume 100 percent financing for projects, term of: 20 years and 4.000% interestCounty Loan $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117

Total Debt Obligations $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117

Total CIP Spending Plus Debt Repayment $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117 $690,117

CIP & Debt Reserves Balance $74,187 $141,179 $160,917 $233,788 $277,041 $305,983 $306,431 $275,879 $235,574 $176,117 $95,294Notes: The County is currently loaning the Authority funds toward payment of debt service. However, the County's contribution to those payments will be reduced each year, starting in 2011. By the end of 2019 the County will no longer be contributing to this debt service and soon the Authority will begin repaying the County.



Class Name

Meter Size in Inches

Meter Square

Inch Capacity

Number Meters

This Size

Total Square

Inch Capacity

Each Meter

Size Group

Total Potential Demand

of a Meter This Size

Potential Demand


Billing Period

Charge Modify-

ing Factor1

Adjusted Potential Demand


Billing Period2

New Minimum

Charge Base Rate

Total Minimum

Charge per Billing Period

Total Annual Demand

Charge Fees by Meter

Size3

Five Eighths 0.625 0.307 843 259 $77 $12.84 10% $1.28 $28.15 $29.43 $6,495Three Quarters 0.750 0.442 0 0 $77 $12.84 10% $1.28 $28.15 $29.43 $0

One Inch 1.000 0.785 37 29 $197 $32.86 100% $32.86 $28.15 $61.01 $7,328One & a Half Inch 1.500 1.767 10 18 $444 $73.93 100% $73.93 $28.15 $102.08 $4,584

Two Inch 2.000 3.142 43 134 $789 $131.44 100% $131.44 $28.15 $159.58 $33,517Three Inch 3.000 7.069 3 21 $1,774 $295.74 100% $295.74 $28.15 $323.88 $5,323

Four Inch 4.000 12.566 0 0 $3,155 $525.75 100% $525.75 $28.15 $553.90 $0Five Inch 5.000 19.635 0 0 $4,929 $821.49 100% $821.49 $28.15 $849.64 $0Six Inch 6.000 28.274 0 0 $7,098 $1,182.95 100% $1,182.95 $28.15 $1,211.09 $0

Seven Inch 7.000 38.485 0 0 $9,661 $1,610.12 100% $1,610.12 $28.15 $1,638.27 $0Eight Inch 8.000 50.266 0 0 $12,618 $2,103.02 100% $2,103.02 $28.15 $2,131.16 $0Nine Inch 9.000 63.617 0 0 $15,970 $2,661.63 100% $2,661.63 $28.15 $2,689.78 $0Ten Inch 10.000 78.540 0 0 $19,716 $3,285.96 100% $3,285.96 $28.15 $3,314.11 $0

Over-sized meters: 93 202 $50,752

All meters: 936 461 $57,247

High-flow Capacity Costs

Large Meter MaintPlant and Distribution

*Costs are amortized for 40 years at a 5.0 percent interest rate. $251.03

This chart depicts minimum charges that are commensurate with the potential of each customer, based on their connection or meter size, to place flow demands on the system. For simplicity, all five-eighths and three-quarter inch meters serving residential properties are assumed to have the same flow capacity and will pay the same potential demand surcharges.

1 Charge Modifying Factor is used to raise or lower the charges to be levied on each size class because small meter and residential users are less prone to wide variations in use, and thus, their peak usage is lower on a percentage basis.2 Adjusted Potential Demand Charge per Meter per Billing Period is the dollar amount that should be added to the standard minimum charge to arrive at the total minimum charge for each meter size class.3 Total Annual Demand Charge Fees by Meter Size - The sum at the bottom of this column is the dollar amount that these meter size based charges will generate in one year.

4 Annualized High-flow Cost to supply potential demand is the total dollar amount of capital investment that these charges seek to recover. The sum at the bottom of the last column of this chart, the amount that will actually be collected by these surcharges, will fall short of this amount if the Charge Modifying Factor for any size class is less than 100%.

$1,970,095$19,700,953 10.0% $1,970,095 $115,701$19,700,953 10.00%

Capital cost of potential demand per square inch of meter size

Annualized High-flow Cost*

$114,814N.A. $887

(This is the amount of additional revenue this surcharge will produce when collected over a full year.)

N.A. N.A.

Total Cost From Balance Sheet

High-flow % of Total Cost High-flow Cost


Chart 4A - Rate Adjustments and Incomes for Modeling Year 7/1/10 Through 6/30/11This chart depicts how rates would be set for this scenario.

$211 Current average hook up fee 1st rate block multiplier 100%

$211 Proposed average hook up fee 2nd rate block multiplier 100%

$0 3rd rate block multiplier N.A.

6/30/11After rate adjustments are made, customers will be billed every other month.

0 999 $151 $29.43 0.000 $0.00 $1 $1521,000 1,999 $0 $29.43 0.000 $0.00 $0 $02,000 2,999 $0 $29.43 0.000 $0.00 $0 $0

0 999 $2,466 $122.25 0.000 $0.00 $9 $2,4741,000 1,999 $0 $122.25 0.000 $0.00 $0 $02,000 2,999 $0 $122.25 0.000 $0.00 $0 $0

0 999 $10,807 $29.43 0.000 $7.74 $62 $10,8691,000 1,999 $9,381 $29.43 0.000 $7.74 $45 $9,4262,000 2,999 $12,169 $29.43 0.000 $7.74 $53 $12,2223,000 3,999 $15,091 $29.43 0.000 $7.74 $62 $15,1534,000 4,999 $19,648 $29.43 0.000 $7.74 $78 $19,7255,000 5,999 $21,958 $29.43 0.000 $7.74 $84 $22,0426,000 6,999 $22,429 $29.43 0.000 $7.74 $84 $22,5137,000 7,999 $23,898 $29.43 0.000 $7.74 $88 $23,9858,000 8,999 $22,772 $29.43 0.000 $7.74 $82 $22,8549,000 9,999 $18,394 $29.43 0.000 $7.74 $65 $18,460

10,000 14,999 $65,561 $29.43 0.000 $7.74 $227 $65,78915,000 19,999 $25,326 $29.43 0.000 $7.74 $85 $25,41120,000 24,999 $10,500 $29.43 0.000 $7.74 $35 $10,53425,000 29,999 $6,188 $29.43 0.000 $7.74 $20 $6,20830,000 34,999 $4,362 $29.43 0.000 $7.74 $14 $4,37635,000 39,999 $3,339 $29.43 0.000 $7.74 $11 $3,34940,000 44,999 $3,156 $29.43 0.000 $7.74 $10 $3,16645,000 49,999 $3,443 $29.43 0.000 $7.74 $11 $3,45450,000 54,999 $3,083 $29.43 0.000 $7.74 $10 $3,09355,000 59,999 $1,657 $29.43 0.000 $7.74 $5 $1,66260,000 64,999 $923 $29.43 0.000 $7.74 $3 $92665,000 69,999 $964 $29.43 0.000 $7.74 $3 $96770,000 74,999 $1,577 $29.43 0.000 $7.74 $5 $1,58275,000 79,999 $577 $29.43 0.000 $7.74 $2 $57980,000 84,999 $1,203 $29.43 0.000 $7.74 $4 $1,20785,000 89,999 $1,902 $29.43 0.000 $7.74 $6 $1,90890,000 9,999,999 $14,451 $29.43 0.000 $7.74 $45 $14,496

0 999 $412 $61.01 0.000 $7.74 $2 $4141,000 1,999 $220 $61.01 0.000 $7.74 $1 $2212,000 2,999 $112 $61.01 0.000 $7.74 $0 $1123,000 3,999 $494 $61.01 0.000 $7.74 $2 $4964,000 4,999 $547 $61.01 0.000 $7.74 $2 $5505,000 5,999 $907 $61.01 0.000 $7.74 $3 $9116,000 6,999 $907 $61.01 0.000 $7.74 $3 $9107,000 7,999 $269 $61.01 0.000 $7.74 $1 $2708,000 8,999 $585 $61.01 0.000 $7.74 $2 $5879,000 9,999 $830 $61.01 0.000 $7.74 $3 $833

10,000 14,999 $1,864 $61.01 0.000 $7.74 $7 $1,87015,000 19,999 $1,476 $61.01 0.000 $7.74 $5 $1,48120,000 24,999 $2,487 $61.01 0.000 $7.74 $8 $2,49625,000 29,999 $2,295 $61.01 0.000 $7.74 $8 $2,30330,000 34,999 $777 $61.01 0.000 $7.74 $3 $78035,000 39,999 $1,849 $61.01 0.000 $7.74 $6 $1,85540,000 44,999 $1,712 $61.01 0.000 $7.74 $6 $1,71845,000 49,999 $3,368 $61.01 0.000 $7.74 $11 $3,37950,000 54,999 $2,464 $61.01 0.000 $7.74 $8 $2,47255,000 59,999 $1,722 $61.01 0.000 $7.74 $5 $1,72860,000 64,999 $2,367 $61.01 0.000 $7.74 $8 $2,37465,000 69,999 $6,083 $61.01 0.000 $7.74 $19 $6,10370,000 74,999 $1,102 $61.01 0.000 $7.74 $3 $1,10675,000 79,999 $2,325 $61.01 0.000 $7.74 $7 $2,33280,000 84,999 $4,940 $61.01 0.000 $7.74 $16 $4,95685,000 89,999 $642 $61.01 0.000 $7.74 $2 $64590,000 9,999,999 $47,246 $61.01 0.000 $7.74 $147 $47,393

New Minimum

Charge Base Rates1

Total Revenues

for Modeling Year



Revenues at

Proposed Rates

Revenues at Test

Year Rates


1,000 Gallons

Proposed User Rates and Blended User Rate Revenues for the Modeling Year

The part of the proposed average hook up fee, above, that will be devoted to future capital improvements

Date when fees will first be collected at adjusted rates - actual adjustment will probably occur one billing period earlier.O

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Class Top Use in

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0 999 $0 $102.08 0.000 $7.74 $0 $01,000 1,999 $91 $102.08 0.000 $7.74 $0 $92

10,000 14,999 $183 $102.08 0.000 $7.74 $1 $18415,000 19,999 $1,389 $102.08 0.000 $7.74 $4 $1,39420,000 24,999 $981 $102.08 0.000 $7.74 $3 $98425,000 29,999 $543 $102.08 0.000 $7.74 $2 $54530,000 34,999 $1,511 $102.08 0.000 $7.74 $5 $1,51535,000 39,999 $1,066 $102.08 0.000 $7.74 $3 $1,07040,000 44,999 $2,281 $102.08 0.000 $7.74 $7 $2,28845,000 49,999 $834 $102.08 0.000 $7.74 $3 $83650,000 54,999 $445 $102.08 0.000 $7.74 $1 $44670,000 74,999 $587 $102.08 0.000 $7.74 $2 $58880,000 84,999 $657 $102.08 0.000 $7.74 $2 $65985,000 89,999 $1,407 $102.08 0.000 $7.74 $4 $1,41190,000 9,999,999 $43,304 $102.08 0.000 $7.74 $133 $43,437

0 999 $2,197 $159.58 0.000 $7.74 $6 $2,2031,000 1,999 $327 $159.58 0.000 $7.74 $1 $3282,000 2,999 $852 $159.58 0.000 $7.74 $2 $8553,000 3,999 $355 $159.58 0.000 $7.74 $1 $3564,000 4,999 $1,108 $159.58 0.000 $7.74 $3 $1,1115,000 5,999 $575 $159.58 0.000 $7.74 $2 $5776,000 6,999 $199 $159.58 0.000 $7.74 $1 $1997,000 7,999 $412 $159.58 0.000 $7.74 $1 $4138,000 8,999 $639 $159.58 0.000 $7.74 $2 $6419,000 9,999 $440 $159.58 0.000 $7.74 $1 $441

10,000 14,999 $922 $159.58 0.000 $7.74 $3 $92515,000 19,999 $567 $159.58 0.000 $7.74 $2 $56920,000 24,999 $964 $159.58 0.000 $7.74 $3 $96725,000 29,999 $1,014 $159.58 0.000 $7.74 $3 $1,01730,000 34,999 $2,658 $159.58 0.000 $7.74 $8 $2,66635,000 39,999 $2,537 $159.58 0.000 $7.74 $8 $2,54440,000 44,999 $3,649 $159.58 0.000 $7.74 $11 $3,66045,000 49,999 $3,415 $159.58 0.000 $7.74 $10 $3,42550,000 54,999 $1,020 $159.58 0.000 $7.74 $3 $1,02355,000 59,999 $1,119 $159.58 0.000 $7.74 $3 $1,12360,000 64,999 $3,010 $159.58 0.000 $7.74 $9 $3,01965,000 69,999 $1,919 $159.58 0.000 $7.74 $6 $1,92570,000 74,999 $1,990 $159.58 0.000 $7.74 $6 $1,99675,000 79,999 $1,416 $159.58 0.000 $7.74 $4 $1,42180,000 84,999 $2,210 $159.58 0.000 $7.74 $7 $2,21685,000 89,999 $2,309 $159.58 0.000 $7.74 $7 $2,31690,000 9,999,999 $400,579 $159.58 0.000 $7.74 $1,220 $401,799

0 999 $0 $323.88 0.000 $7.74 $0 $035,000 39,999 $549 $323.88 0.000 $7.74 $2 $55190,000 9,999,999 $90,312 $323.88 0.000 $7.74 $276 $90,588

0 999 $0 $553.90 0.000 $7.74 $0 $01,000 1,999 $0 $553.90 0.000 $7.74 $0 $0

90,000 9,999,999 $0 $553.90 0.000 $7.74 $0 $0

0 999 $5 $4.90 0.000 $80.00 $0 $51,000 1,999 $101 $4.90 0.000 $80.00 $0 $1022,000 2,999 $184 $4.90 0.000 $80.00 $1 $1854,000 4,999 $386 $4.90 0.000 $80.00 $1 $3875,000 5,999 $431 $4.90 0.000 $80.00 $1 $432

15,000 19,999 $2,712 $4.90 0.000 $80.00 $8 $2,72020,000 24,999 $3,416 $4.90 0.000 $80.00 $9 $3,42525,000 29,999 $2,326 $4.90 0.000 $80.00 $6 $2,333

0 999 $9 $4.90 0.000 $100.00 $0 $910,000 14,999 $1,169 $4.90 0.000 $100.00 $3 $1,17290,000 9,999,999 $0 $4.90 0.000 $100.00 $0 $0

0 999 $0 $0.00 0.000 $0.00 $0 $090,000 9,999,999 $0 $0.00 0.000 $0.00 $0 $0

Extra Service Units $0 $6.30 0.000 $0.00 $51.58 $51.58$1,012,763 Rate Rev at Adjusted Rates $3,356

Total Blended Rate Revenues for the Year 2 $1,016,119

Note 2: Blended Rate Revenues for the one-year period 7/1/10 through 6/30/11 assume the following:12.0 months at the old user charge rates and 0.0

Note 1: Not applicable.

months at the new user charge rates.

Rate Rev at Current Rates

Revenues at Test

Year Rates

New Minimum

Charge Base

Rates1

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1,000 Gallons



Revenues at

Proposed Rates

Total Blended

Revenues for Modeling

Year

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Class Bottom Use

in Gallons

Class Top Use in

Gallons

Mai

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Rockbridge County PSA, Sewer Rates Scenario 1Chart 4B - Rate Statistics CBGreatRates© Version 5.2

This chart shows the equitability of the rates as modeled in the Rate Setting Chart.

Your average residential customer uses 7,137 Gallons per billing cycle.


Class Top Use in

Gallons % Users % Usage % Rev at

Current Rates

% Rev at Proposed

Rates 0 999 0.29% 0.00% 0.24% 0.25%

1,000 1,999 0.00% 0.00% 0.00% 0.00%0.29% 0.00% 0.24% 0.25%

0 999 8.30% 0.12% 1.07% 1.84%1,000 1,999 4.57% 0.46% 0.93% 1.33%2,000 2,999 4.57% 0.78% 1.20% 1.58%3,000 3,999 4.61% 1.11% 1.49% 1.85%4,000 4,999 5.06% 1.57% 1.94% 2.31%5,000 5,999 4.88% 1.86% 2.17% 2.51%6,000 6,999 4.39% 1.98% 2.21% 2.50%7,000 7,999 4.18% 2.18% 2.36% 2.61%8,000 8,999 3.61% 2.12% 2.25% 2.45%9,000 9,999 2.65% 1.75% 1.82% 1.95%

10,000 14,999 7.72% 6.48% 6.47% 6.77%15,000 19,999 2.21% 2.61% 2.50% 2.54%20,000 24,999 0.72% 1.11% 1.04% 1.03%25,000 29,999 0.35% 0.66% 0.61% 0.60%30,000 34,999 0.21% 0.47% 0.43% 0.42%35,000 39,999 0.14% 0.36% 0.33% 0.32%40,000 44,999 0.12% 0.35% 0.31% 0.30%45,000 49,999 0.12% 0.38% 0.34% 0.33%50,000 54,999 0.09% 0.34% 0.30% 0.29%55,000 59,999 0.05% 0.18% 0.16% 0.16%60,000 64,999 0.02% 0.10% 0.09% 0.09%65,000 69,999 0.02% 0.11% 0.10% 0.09%70,000 74,999 0.03% 0.18% 0.16% 0.15%75,000 79,999 0.01% 0.06% 0.06% 0.05%80,000 84,999 0.02% 0.13% 0.12% 0.11%85,000 89,999 0.03% 0.21% 0.19% 0.18%90,000 9,999,999 0.12% 1.64% 1.43% 1.33%

58.81% 29.29% 32.07% 35.67%

0 999 0.13% 0.00% 0.04% 0.06%1,000 1,999 0.06% 0.00% 0.02% 0.03%2,000 2,999 0.02% 0.00% 0.01% 0.01%3,000 3,999 0.09% 0.02% 0.05% 0.06%4,000 4,999 0.09% 0.03% 0.05% 0.06%5,000 5,999 0.14% 0.05% 0.09% 0.10%6,000 6,999 0.13% 0.06% 0.09% 0.10%7,000 7,999 0.03% 0.02% 0.03% 0.03%8,000 8,999 0.07% 0.04% 0.06% 0.06%9,000 9,999 0.09% 0.06% 0.08% 0.09%

10,000 14,999 0.17% 0.15% 0.18% 0.20%15,000 19,999 0.10% 0.13% 0.15% 0.15%20,000 24,999 0.15% 0.23% 0.25% 0.25%25,000 29,999 0.12% 0.22% 0.23% 0.23%30,000 34,999 0.03% 0.08% 0.08% 0.08%35,000 39,999 0.07% 0.19% 0.18% 0.18%40,000 44,999 0.06% 0.18% 0.17% 0.16%45,000 49,999 0.10% 0.35% 0.33% 0.32%50,000 54,999 0.07% 0.26% 0.24% 0.23%55,000 59,999 0.05% 0.18% 0.17% 0.16%60,000 64,999 0.06% 0.25% 0.23% 0.22%65,000 69,999 0.14% 0.65% 0.60% 0.57%70,000 74,999 0.02% 0.12% 0.11% 0.10%75,000 79,999 0.05% 0.25% 0.23% 0.22%80,000 84,999 0.09% 0.53% 0.49% 0.46%85,000 89,999 0.01% 0.07% 0.06% 0.06%90,000 9,999,999 0.43% 5.26% 4.67% 4.37%

2.59% 9.38% 8.89% 8.58%

If your rates are absolutely proportional to use on a volumetric basis, your % of usage and % of revenues figures will be the same within all the classes. That is not possible if you have any minimum charge.

Normally, the % of usage figure will be lower than the % of revenue for the lower volume classes. That will switch for the higher volume classes. Even for declining rate structures, this switch should occur near the volume of the average residential user, typically near 5,000 gallons/month (668 cu ft).

In urban and suburban areas the average monthly use for residential or general customers can be twice that used by their rural and "old town" counterparts. Use is largely dependent upon who lives in a community. Older people living in longer established neighborhoods tend to use less volume than younger people living in more recently developed areas. Consider this.

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Compare the % of Usage and % of Revenue for this volume of use, and others, in the chart below to get an idea of how proportional to actual volume use the rates are as proposed in this analysis.

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Class Top Use in

Gallons% Users % Usage % Rev at

Current Rates

% Rev at Proposed

Rates 0 999 0.00% 0.00% 0.00% 0.00%

1,000 1,999 0.01% 0.00% 0.01% 0.01%10,000 14,999 0.01% 0.01% 0.02% 0.02%15,000 19,999 0.08% 0.09% 0.14% 0.13%20,000 24,999 0.05% 0.07% 0.10% 0.09%25,000 29,999 0.02% 0.04% 0.05% 0.05%30,000 34,999 0.06% 0.12% 0.15% 0.14%35,000 39,999 0.03% 0.09% 0.11% 0.10%40,000 44,999 0.07% 0.20% 0.23% 0.21%45,000 49,999 0.02% 0.08% 0.08% 0.08%50,000 54,999 0.01% 0.04% 0.04% 0.04%70,000 74,999 0.01% 0.06% 0.06% 0.05%80,000 84,999 0.01% 0.07% 0.06% 0.06%85,000 89,999 0.02% 0.14% 0.14% 0.13%90,000 9,999,999 0.29% 4.72% 4.28% 3.96%

0.72% 5.75% 5.47% 5.09%

0 999 0.16% 0.00% 0.22% 0.19%1,000 1,999 0.02% 0.00% 0.03% 0.03%2,000 2,999 0.06% 0.01% 0.08% 0.07%3,000 3,999 0.02% 0.00% 0.04% 0.03%4,000 4,999 0.07% 0.02% 0.11% 0.10%5,000 5,999 0.03% 0.01% 0.06% 0.05%6,000 6,999 0.01% 0.00% 0.02% 0.02%7,000 7,999 0.02% 0.01% 0.04% 0.04%8,000 8,999 0.03% 0.02% 0.06% 0.06%9,000 9,999 0.02% 0.01% 0.04% 0.04%

10,000 14,999 0.05% 0.03% 0.09% 0.08%15,000 19,999 0.02% 0.03% 0.06% 0.05%20,000 24,999 0.03% 0.06% 0.10% 0.08%25,000 29,999 0.03% 0.06% 0.10% 0.09%30,000 34,999 0.08% 0.18% 0.26% 0.24%35,000 39,999 0.07% 0.18% 0.25% 0.23%40,000 44,999 0.09% 0.27% 0.36% 0.32%45,000 49,999 0.08% 0.27% 0.34% 0.30%50,000 54,999 0.02% 0.08% 0.10% 0.09%55,000 59,999 0.02% 0.09% 0.11% 0.10%60,000 64,999 0.06% 0.26% 0.30% 0.27%65,000 69,999 0.03% 0.17% 0.19% 0.17%70,000 74,999 0.03% 0.17% 0.20% 0.18%75,000 79,999 0.02% 0.13% 0.14% 0.13%80,000 84,999 0.03% 0.20% 0.22% 0.20%85,000 89,999 0.03% 0.21% 0.23% 0.21%90,000 9,999,999 1.77% 43.19% 39.55% 36.34%

2.96% 45.68% 43.29% 39.68%

35,000 39,999 0.01% 0.03% 0.05% 0.05%90,000 9,999,999 0.20% 9.76% 8.92% 8.22%

0.21% 9.79% 8.97% 8.27%

0 999 0.00% 0.00% 0.00% 0.00%90,000 9,999,999 0.00% 0.00% 0.00% 0.00%

0.00% 0.00% 0.00% 0.00%

0 999 0.02% 0.00% 0.00% 0.00%1,000 1,999 0.01% 0.00% 0.01% 0.01%2,000 2,999 0.01% 0.00% 0.02% 0.02%4,000 4,999 0.01% 0.00% 0.04% 0.03%5,000 5,999 0.01% 0.00% 0.04% 0.04%

15,000 19,999 0.02% 0.03% 0.27% 0.22%20,000 24,999 0.02% 0.03% 0.34% 0.28%25,000 29,999 0.01% 0.02% 0.23% 0.19%

0.13% 0.10% 0.94% 0.79%

0 999 0.05% 0.00% 0.00% 0.00%10,000 14,999 0.01% 0.01% 0.12% 0.10%

0.06% 0.01% 0.12% 0.10%

Extra Service Units 34.03% 0.00% 0.00% 1.54%

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Chart 5 - Indicators This chart depicts the affordability of future rates, the financial health of the system and the ending balances in various accounts for 10 years. CBGreatRates© Version 5.2

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Year Starting

Capacity Indicators 7/1/09 7/1/10 7/1/11 7/1/12 7/1/13 7/1/14 7/1/15 7/1/16 7/1/17 7/1/18 7/1/19

$84.87 $88.30 $110.29 $114.70 $119.28 $124.06 $129.02 $134.18 $139.55 $145.13 $150.93

$41.78 $53.39 $55.53 $57.75 $60.06 $62.46 $64.96 $67.56 $70.26 $73.07 $75.99

$45,803 $47,045 $48,320 $49,630 $50,975 $52,357 $53,776 $55,234 $56,731 $58,269 $59,848

1.09% 1.36% 1.38% 1.40% 1.41% 1.43% 1.45% 1.47% 1.49% 1.50% 1.52%

1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50

1.11 1.20 1.23 1.34 1.40 1.44 1.44 1.40 1.34 1.26 1.14

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Balance Ending on

Reserves 6/30/10 6/30/11 6/30/12 6/30/13 6/30/14 6/30/15 6/30/16 6/30/17 6/30/18 6/30/19 6/30/20

$370,298 $433,180 $533,967 $556,028 $583,222 $607,885 $636,293 $668,760 $697,595 $730,646 $768,264

$74,187 $141,179 $160,917 $233,788 $277,041 $305,983 $306,431 $275,879 $235,574 $176,117 $95,294

$446,357 $458,251 $387,446 $371,996 $455,284 $508,825 $593,316 $646,386 $669,092 $531,350 $603,691

$444,486 $574,359 $694,885 $789,816 $860,264 $913,867 $942,724 $944,639 $933,169 $906,763 $863,558

$890,842 $1,032,610 $1,082,331 $1,161,812 $1,315,548 $1,422,692 $1,536,040 $1,591,025 $1,602,261 $1,438,113 $1,467,249

$444,486 $574,359 $667,089 $727,894 $761,106 $776,190 $768,671 $739,424 $701,227 $654,129 $598,043

Cash & Cash Equivalents (Current Position) + CIP & Debt Reserves

All Assets Except Hard Assets and R&R, Discounted for Inflation (Future

Purchasing Power)

Equivalent Average Monthly Bill Actually Paid by All Customers Throughout the

Year

Equivalent Final Monthly Bill for a 5,000 gal per Month Residential User


Affordability Index for Proposed Rates

Estimated Operating Ratio for Proposed Rates

Estimated Coverage Ratio for Proposed Rates

Total Assets, Excluding Hard Assets

Replacement Funds

Cash & Cash Equivalents (Current Position)

CIP & Debt Reserves

Affordability Index is the percent of AMHI needed by a 5,000 gallon per month residential user to pay their bill. Rates near 1.0% are common in the U.S. and are generally considered affordable. Federal grant agencies generally will not consider awarding grants if this indicator is less than 2.0%.

1.0 is break even for Operating Ratio. Below 1.0 indicates operating in the "red." Generally, the operating ratio should be at least 1.15 for large systems, 1.30 or more for medium systems and perhaps as high as 2.0 for small systems.

Coverage Ratio applies only to years with debt service. 1.0 is break even. Generally, the coverage ratio should be at least 1.25.

1.00

1.10

1.20

1.30

1.40

1.50

1.60

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 6 - Operating RatioProposed Rates

Current Rates


-5.00

-4.00

-3.00

-2.00

-1.00

0.00

1.00

2.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 7 - Coverage Ratio

Proposed Rates

Current Rates

$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

$80.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 8 - 5,000 Gal Residential User's Bill

Proposed Rates

Current Rates


0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 9 - Affordability IndexProposed Rates

Current Rates

-$400,000

-$200,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 10 - Working Capital

Proposed RatesCurrent RatesGoal

Rockbridge County

-$5,000,000

-$4,000,000

-$3,000,000

-$2,000,000

-$1,000,000

$0

$1,000,000

$2,000,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 11 - Future Purchasing Power of Liquid Assets

At Proposed Rates

At Current Rates

0%

1%

2%

3%

4%

5%

6%

7%

8%

0-99

9

1000

-199

9

2000

-299

9

3000

-399

9

4000

-499

9

5000

-599

9

6000

-699

9

7000

-799

9

8000

-899

9

9000

-999

9

1000

0-14

999

1500

0-19

999

2000

0-24

999

2500

0-29

999

8000

0-84

999

8500

0-89

999

9000

0-…

Chart 13 - Residential Use & Revenues

% Usage




-$400,000

-$200,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 12 - Current Position


-10%

0%

10%

20%

30%

40%

50%

1" M

eter

s

1 1/

2" M

eter

s

2" M

eter

s

3" M

eter

s

Sept

age

In

Sept

age

Out

Chart 13B - All Other Use & Revenues

% Usage




$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

$160.00

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 8B - System-wide Average User's BillProposed Rates

Current Regime


0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Chart 9B - Over-all Affordability IndexProposed Rates

Current Regime

Rockbridge County PSA, Sewer Rates Scenario 1Chart 14 - Old Rates, New Rates and ChangesThis chart compares current and proposed rates. CBGreatRates© Version 5.2

6/30/110 999 0.000 $13.56 $29.43 $15.87 117%

1,000 1,999 1.500 $13.56 $29.43 $15.87 117%2,000 2,999 2.500 $13.56 $29.43 $15.87 117%

0 999 0.000 $97.56 $122.25 $24.69 25%1,000 1,999 1.500 $97.56 $122.25 $24.69 25%2,000 2,999 2.500 $97.56 $122.25 $24.69 25%

0 999 0.202 $14.97 $30.99 $16.02 107%1,000 1,999 1.437 $23.61 $40.54 $16.92 72%2,000 2,999 2.440 $30.63 $48.29 $17.66 58%3,000 3,999 3.437 $37.60 $55.99 $18.39 49%4,000 4,999 4.449 $44.68 $63.81 $19.14 43%5,000 5,999 5.455 $51.71 $71.59 $19.88 38%6,000 6,999 6.453 $58.69 $79.30 $20.61 35%7,000 7,999 7.450 $65.66 $87.00 $21.34 33%8,000 8,999 8.417 $72.43 $94.48 $22.05 30%9,000 9,999 9.472 $79.80 $102.62 $22.82 29%

10,000 14,999 12.025 $97.66 $122.36 $24.70 25%15,000 19,999 16.909 $131.85 $160.14 $28.29 21%20,000 24,999 22.005 $167.51 $199.54 $32.03 19%25,000 29,999 27.220 $204.01 $239.88 $35.87 18%30,000 34,999 32.317 $239.68 $279.29 $39.61 17%35,000 39,999 37.392 $275.20 $318.54 $43.34 16%40,000 44,999 42.670 $312.14 $359.36 $47.22 15%45,000 49,999 46.730 $340.55 $390.75 $50.20 15%50,000 54,999 52.538 $381.20 $435.67 $54.47 14%55,000 59,999 56.600 $409.63 $467.08 $57.46 14%60,000 64,999 63.300 $456.52 $518.90 $62.38 14%65,000 69,999 66.200 $476.81 $541.32 $64.51 14%70,000 74,999 72.367 $519.97 $589.02 $69.04 13%75,000 79,999 79.600 $570.60 $644.96 $74.36 13%80,000 84,999 83.100 $595.09 $672.02 $76.93 13%85,000 89,999 87.667 $627.05 $707.34 $80.29 13%90,000 9,999,999 202.290 $1,429.41 $1,593.94 $164.53 12%

0 999 0.082 $37.05 $61.64 $24.59 66%1,000 1,999 1.020 $43.61 $68.89 $25.27 58%2,000 2,999 2.700 $55.37 $81.87 $26.51 48%3,000 3,999 3.525 $61.13 $88.25 $27.11 44%4,000 4,999 4.463 $67.69 $95.49 $27.80 41%5,000 5,999 5.475 $74.77 $103.32 $28.55 38%6,000 6,999 6.445 $81.56 $110.81 $29.26 36%7,000 7,999 7.467 $88.70 $118.71 $30.01 34%8,000 8,999 8.567 $96.39 $127.21 $30.82 32%9,000 9,999 9.450 $102.57 $134.03 $31.46 31%

10,000 14,999 12.353 $122.88 $156.48 $33.60 27%15,000 19,999 17.978 $162.25 $199.98 $37.73 23%20,000 24,999 21.838 $189.27 $229.83 $40.57 21%25,000 29,999 27.230 $227.00 $271.53 $44.53 20%30,000 34,999 31.400 $256.18 $303.78 $47.59 19%35,000 39,999 38.350 $304.83 $357.53 $52.70 17%40,000 44,999 43.200 $338.77 $395.03 $56.27 17%45,000 49,999 47.689 $370.18 $429.75 $59.56 16%50,000 54,999 52.833 $406.19 $469.53 $63.34 16%55,000 59,999 55.650 $425.90 $491.31 $65.41 15%60,000 64,999 61.700 $468.24 $538.10 $69.86 15%65,000 69,999 66.442 $501.42 $574.77 $73.34 15%70,000 74,999 72.700 $545.23 $623.17 $77.94 14%75,000 79,999 76.950 $574.97 $656.04 $81.07 14%80,000 84,999 82.075 $610.84 $695.67 $84.83 14%85,000 89,999 85.600 $635.51 $722.93 $87.42 14%90,000 9,999,999 175.249 $1,263.04 $1,416.35 $153.31 12%

Ove

rage

U

nmet

ered

Sew

er

Unm

eter

ed5/

8" M

eter

s1"

Met

ers

Proposed Average Bill Starting onCurrent

Average Bill



Class Top Use in

Gallons

Class Bottom Use in

Gallons

Median or Actual


Percent Increase or


Adjustment

6/30/110 999 0.500 $86.86 $105.94 $19.09 22%

1,000 1,999 1.000 $90.35 $109.81 $19.45 22%2,000 2,999 2.000 $97.35 $117.53 $20.19 21%3,000 3,999 3.500 $107.84 $129.13 $21.29 20%4,000 4,999 4.500 $114.83 $136.85 $22.02 19%5,000 5,999 5.500 $121.82 $144.58 $22.76 19%6,000 6,999 6.500 $128.81 $152.31 $23.49 18%7,000 7,999 7.500 $135.81 $160.03 $24.23 18%8,000 8,999 8.500 $142.80 $167.76 $24.96 17%9,000 9,999 9.500 $149.79 $175.49 $25.70 17%

10,000 14,999 14.000 $181.29 $210.29 $29.00 16%15,000 19,999 16.143 $196.28 $226.86 $30.58 16%20,000 24,999 22.750 $242.53 $277.96 $35.43 15%25,000 29,999 26.500 $268.77 $306.96 $38.19 14%30,000 34,999 30.800 $298.86 $340.21 $41.35 14%35,000 39,999 38.333 $351.59 $398.47 $46.88 13%40,000 44,999 41.833 $376.08 $425.54 $49.46 13%45,000 49,999 47.000 $412.24 $465.49 $53.25 13%50,000 54,999 51.000 $440.23 $496.43 $56.19 13%55,000 59,999 57.500 $485.72 $546.69 $60.97 13%60,000 64,999 62.500 $520.72 $585.36 $64.64 12%65,000 69,999 67.500 $555.71 $624.03 $68.32 12%70,000 74,999 71.000 $580.21 $651.09 $70.89 12%75,000 79,999 77.500 $625.70 $701.36 $75.67 12%80,000 84,999 81.000 $650.19 $728.43 $78.24 12%85,000 89,999 87.500 $695.69 $778.70 $83.01 12%90,000 9,999,999 232.880 $1,713.34 $1,903.21 $189.87 11%

0 999 0.079 $155.21 $160.19 $4.98 3%1,000 1,999 1.000 $161.65 $167.31 $5.66 4%2,000 2,999 2.000 $168.65 $175.04 $6.39 4%3,000 3,999 3.000 $175.64 $182.77 $7.13 4%4,000 4,999 4.000 $182.63 $190.49 $7.86 4%5,000 5,999 5.000 $189.63 $198.22 $8.60 5%6,000 6,999 6.000 $196.62 $205.95 $9.33 5%7,000 7,999 7.000 $203.61 $213.68 $10.06 5%8,000 8,999 8.000 $210.60 $221.40 $10.80 5%9,000 9,999 9.000 $217.60 $229.13 $11.53 5%

10,000 14,999 10.500 $228.09 $240.72 $12.63 6%15,000 19,999 18.000 $280.58 $298.73 $18.15 6%20,000 24,999 23.333 $317.91 $339.97 $22.07 7%25,000 29,999 25.667 $334.24 $358.02 $23.78 7%30,000 34,999 31.571 $375.56 $403.68 $28.12 7%35,000 39,999 37.667 $418.22 $450.82 $32.60 8%40,000 44,999 42.375 $451.17 $487.23 $36.06 8%45,000 49,999 46.857 $482.54 $521.89 $39.35 8%50,000 54,999 50.000 $504.53 $546.20 $41.66 8%55,000 59,999 57.000 $553.53 $600.33 $46.81 8%60,000 64,999 63.000 $595.52 $646.73 $51.21 9%65,000 69,999 68.333 $632.85 $687.98 $55.13 9%70,000 74,999 71.667 $656.17 $713.76 $57.58 9%75,000 79,999 78.000 $700.50 $762.74 $62.24 9%80,000 84,999 82.000 $728.49 $793.67 $65.18 9%85,000 89,999 86.667 $761.15 $829.76 $68.61 9%90,000 9,999,999 350.322 $2,606.73 $2,869.13 $262.39 10%

2" M

eter

s1

1/2"

Met

ers

Class Bottom Use in

Gallons

Class Top Use in

Gallons

Median or Actual






Percent Increase or


Adjustment

6/30/110 999 0.500 $301.58 $327.75 $26.17 9%

1,000 1,999 1.500 $308.57 $335.47 $26.90 9%2,000 2,999 2.500 $315.56 $343.20 $27.64 9%3,000 3,999 3.500 $322.56 $350.93 $28.37 9%4,000 4,999 4.500 $329.55 $358.66 $29.11 9%5,000 5,999 5.500 $336.54 $366.38 $29.84 9%6,000 6,999 6.500 $343.53 $374.11 $30.58 9%7,000 7,999 7.500 $350.53 $381.84 $31.31 9%8,000 8,999 8.500 $357.52 $389.56 $32.04 9%9,000 9,999 9.500 $364.51 $397.29 $32.78 9%

10,000 14,999 12.500 $385.51 $420.49 $34.98 9%15,000 19,999 17.500 $420.50 $459.16 $38.66 9%20,000 24,999 22.500 $455.49 $497.82 $42.33 9%25,000 29,999 27.500 $490.49 $536.49 $46.01 9%30,000 34,999 32.500 $525.48 $575.16 $49.68 9%35,000 39,999 35.000 $542.98 $594.49 $51.52 9%40,000 44,999 42.500 $595.46 $652.49 $57.03 10%45,000 49,999 47.500 $630.46 $691.16 $60.70 10%50,000 54,999 52.500 $665.45 $729.83 $64.38 10%55,000 59,999 57.500 $700.44 $768.49 $68.05 10%60,000 64,999 62.500 $735.44 $807.16 $71.73 10%65,000 69,999 67.500 $770.43 $845.83 $75.40 10%70,000 74,999 72.500 $805.42 $884.50 $79.07 10%75,000 79,999 77.500 $840.42 $923.16 $82.75 10%80,000 84,999 82.500 $875.41 $961.83 $86.42 10%85,000 89,999 87.500 $910.40 $1,000.50 $90.10 10%90,000 9,999,999 708.118 $5,254.72 $5,800.97 $546.25 10%

0 999 0.500 $469.28 $557.76 $88.49 19%1,000 1,999 1.500 $476.27 $565.49 $89.22 19%2,000 2,999 2.500 $483.26 $573.22 $89.96 19%3,000 3,999 3.500 $490.26 $580.95 $90.69 18%4,000 4,999 4.500 $497.25 $588.67 $91.42 18%5,000 5,999 5.500 $504.24 $596.40 $92.16 18%6,000 6,999 6.500 $511.23 $604.13 $92.89 18%7,000 7,999 7.500 $518.23 $611.85 $93.63 18%8,000 8,999 8.500 $525.22 $619.58 $94.36 18%9,000 9,999 9.500 $532.21 $627.31 $95.10 18%

10,000 14,999 12.500 $553.21 $650.51 $97.30 18%15,000 19,999 17.500 $588.20 $689.17 $100.97 17%20,000 24,999 22.500 $623.19 $727.84 $104.65 17%25,000 29,999 27.500 $658.19 $766.51 $108.32 16%30,000 34,999 32.500 $693.18 $805.18 $112.00 16%35,000 39,999 37.500 $728.17 $843.84 $115.67 16%40,000 44,999 42.500 $763.16 $882.51 $119.35 16%45,000 49,999 47.500 $798.16 $921.18 $123.02 15%50,000 54,999 52.500 $833.15 $959.84 $126.69 15%55,000 59,999 57.500 $868.14 $998.51 $130.37 15%60,000 64,999 62.500 $903.14 $1,037.18 $134.04 15%65,000 69,999 67.500 $938.13 $1,075.85 $137.72 15%70,000 74,999 72.500 $973.12 $1,114.51 $141.39 15%75,000 79,999 77.500 $1,008.12 $1,153.18 $145.07 14%80,000 84,999 82.500 $1,043.11 $1,191.85 $148.74 14%85,000 89,999 87.500 $1,078.10 $1,230.52 $152.41 14%90,000 9,999,999 5,045.000 $35,780.59 $39,576.77 $3,796.18 11%

3" M

eter

s4"

Met

ers





Percent Increase or


Adjustment

Class Bottom Use in

Gallons

Class Top Use in

Gallons

Median or Actual


6/30/110 999 0.000 $2.24 $4.90 $2.66 119%

1,000 1,999 1.225 $100.16 $102.82 $2.66 3%2,000 2,999 2.250 $182.08 $184.74 $2.66 1%3,000 3,999 3.500 $281.96 $284.62 $2.66 1%4,000 4,999 4.750 $381.92 $384.58 $2.66 1%5,000 5,999 5.300 $425.84 $428.50 $2.66 1%6,000 6,999 6.500 $521.72 $524.38 $2.66 1%7,000 7,999 7.500 $601.64 $604.30 $2.66 0%8,000 8,999 8.500 $681.56 $684.22 $2.66 0%9,000 9,999 9.500 $761.48 $764.14 $2.66 0%

10,000 14,999 12.500 $1,001.40 $1,004.06 $2.66 0%15,000 19,999 16.750 $1,341.36 $1,344.02 $2.66 0%20,000 24,999 21.100 $1,689.28 $1,691.94 $2.66 0%25,000 29,999 28.750 $2,301.20 $2,303.86 $2.66 0%30,000 34,999 32.500 $2,601.08 $2,603.74 $2.66 0%35,000 39,999 37.500 $3,001.00 $3,003.66 $2.66 0%40,000 44,999 42.500 $3,400.92 $3,403.58 $2.66 0%45,000 49,999 47.500 $3,800.84 $3,803.50 $2.66 0%50,000 54,999 52.500 $4,200.76 $4,203.42 $2.66 0%55,000 59,999 57.500 $4,600.68 $4,603.34 $2.66 0%60,000 64,999 62.500 $5,000.60 $5,003.26 $2.66 0%65,000 69,999 67.500 $5,400.52 $5,403.18 $2.66 0%70,000 74,999 72.500 $5,800.44 $5,803.10 $2.66 0%75,000 79,999 77.500 $6,200.36 $6,203.02 $2.66 0%80,000 84,999 82.500 $6,600.28 $6,602.94 $2.66 0%85,000 89,999 87.500 $7,000.20 $7,002.86 $2.66 0%90,000 9,999,999 5,045.000 $403,600.12 $403,602.78 $2.66 0%

0 999 0.000 $2.24 $4.90 $2.66 119%1,000 1,999 1.500 $152.09 $154.75 $2.66 2%2,000 2,999 2.500 $251.99 $254.65 $2.66 1%3,000 3,999 3.500 $351.89 $354.55 $2.66 1%4,000 4,999 4.500 $451.79 $454.45 $2.66 1%5,000 5,999 5.500 $551.69 $554.35 $2.66 0%6,000 6,999 6.500 $651.59 $654.25 $2.66 0%7,000 7,999 7.500 $751.49 $754.15 $2.66 0%8,000 8,999 8.500 $851.39 $854.05 $2.66 0%9,000 9,999 9.500 $951.29 $953.95 $2.66 0%

10,000 14,999 11.550 $1,156.24 $1,158.90 $2.66 0%15,000 19,999 17.500 $1,751.09 $1,753.75 $2.66 0%20,000 24,999 22.500 $2,250.99 $2,253.65 $2.66 0%25,000 29,999 27.500 $2,750.89 $2,753.55 $2.66 0%30,000 34,999 32.500 $3,250.79 $3,253.45 $2.66 0%35,000 39,999 37.500 $3,750.69 $3,753.35 $2.66 0%40,000 44,999 42.500 $4,250.59 $4,253.25 $2.66 0%45,000 49,999 47.500 $4,750.49 $4,753.15 $2.66 0%50,000 54,999 52.500 $5,250.39 $5,253.05 $2.66 0%55,000 59,999 57.500 $5,750.29 $5,752.95 $2.66 0%60,000 64,999 62.500 $6,250.19 $6,252.85 $2.66 0%65,000 69,999 67.500 $6,750.09 $6,752.75 $2.66 0%70,000 74,999 72.500 $7,249.99 $7,252.65 $2.66 0%75,000 79,999 77.500 $7,749.89 $7,752.55 $2.66 0%80,000 84,999 82.500 $8,249.79 $8,252.45 $2.66 0%85,000 89,999 87.500 $8,749.69 $8,752.35 $2.66 0%90,000 9,999,999 5,045.000 $504,499.59 $504,502.25 $2.66 0%

Extra Service Units $0.00 $6.30 $6.30 #DIV/0!

Sep

tage

Out

Sep

tage

In



Percent Increase or


Adjustment

Class Bottom Use in

Gallons

Class Top Use in

Gallons

Median or Actual




Rockbridge County PSA CBGreatRates© Version 5.2

Chart 15 - Test Year Usage One-year period being analyzed starts 7/1/2009

This chart shows usage by your customers, averaged across the entire test year. Date this scenario created 2/7/2011




ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.000 2 2 2 2 2 2 21,000 1,999 1.500 0 0 0 0 0 0 02,000 2,999 2.500 0 0 0 0 0 0 03,000 3,999 3.500 0 0 0 0 0 0 0

Subtotal: 20 999 0.000 4 4 4 4 4 4 4

1,000 1,999 1.500 0 0 0 0 0 0 02,000 2,999 2.500 0 0 0 0 0 0 03,000 3,999 3.500 0 0 0 0 0 0 0

Subtotal: 40 999 0.202 119 119 119 119 119 119 119

1,000 1,999 1.437 66 66 66 66 66 66 662,000 2,999 2.440 66 66 66 66 66 66 663,000 3,999 3.437 66 66 66 66 66 66 664,000 4,999 4.449 73 73 73 73 73 73 735,000 5,999 5.455 70 70 70 70 70 70 706,000 6,999 6.453 63 63 63 63 63 63 637,000 7,999 7.450 60 60 60 60 60 60 608,000 8,999 8.417 52 52 52 52 52 52 529,000 9,999 9.472 38 38 38 38 38 38 38

10,000 14,999 12.025 111 111 111 111 111 111 11115,000 19,999 16.909 32 32 32 32 32 32 3220,000 24,999 22.005 10 10 10 10 10 10 1025,000 29,999 27.220 5 5 5 5 5 5 530,000 34,999 32.317 3 3 3 3 3 3 335,000 39,999 37.392 2 2 2 2 2 2 240,000 44,999 42.670 2 2 2 2 2 2 245,000 49,999 46.730 2 2 2 2 2 2 250,000 54,999 52.538 1 1 1 1 1 1 155,000 59,999 56.600 1 1 1 1 1 1 160,000 64,999 63.300 0 0 0 0 0 0 065,000 69,999 66.200 0 0 0 0 0 0 070,000 74,999 72.367 1 1 1 1 1 1 175,000 79,999 79.600 0 0 0 0 0 0 080,000 84,999 83.100 0 0 0 0 0 0 085,000 89,999 87.667 1 1 1 1 1 1 190,000 9,999,999 202.290 2 2 2 2 2 2 2

Subtotal: 843

Ove

rage

U

nmet

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Sew

er

Unm

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ed5/

8" M

eter

s




ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.082 2 2 2 2 2 2 21,000 1,999 1.020 1 1 1 1 1 1 12,000 2,999 2.700 0 0 0 0 0 0 03,000 3,999 3.525 1 1 1 1 1 1 14,000 4,999 4.463 1 1 1 1 1 1 15,000 5,999 5.475 2 2 2 2 2 2 26,000 6,999 6.445 2 2 2 2 2 2 27,000 7,999 7.467 1 1 1 1 1 1 18,000 8,999 8.567 1 1 1 1 1 1 19,000 9,999 9.450 1 1 1 1 1 1 1

10,000 14,999 12.353 3 3 3 3 3 3 315,000 19,999 17.978 2 2 2 2 2 2 220,000 24,999 21.838 2 2 2 2 2 2 225,000 29,999 27.230 2 2 2 2 2 2 230,000 34,999 31.400 1 1 1 1 1 1 135,000 39,999 38.350 1 1 1 1 1 1 140,000 44,999 43.200 1 1 1 1 1 1 145,000 49,999 47.689 2 2 2 2 2 2 250,000 54,999 52.833 1 1 1 1 1 1 155,000 59,999 55.650 1 1 1 1 1 1 160,000 64,999 61.700 1 1 1 1 1 1 165,000 69,999 66.442 2 2 2 2 2 2 270,000 74,999 72.700 0 0 0 0 0 0 075,000 79,999 76.950 1 1 1 1 1 1 180,000 84,999 82.075 1 1 1 1 1 1 185,000 89,999 85.600 0 0 0 0 0 0 090,000 9,999,999 175.249 6 6 6 6 6 6 6

Subtotal: 3715,000 19,999 16.143 1 1 1 1 1 1 120,000 24,999 22.750 1 1 1 1 1 1 130,000 34,999 30.800 1 1 1 1 1 1 135,000 39,999 38.333 1 1 1 1 1 1 140,000 44,999 41.833 1 1 1 1 1 1 190,000 9,999,999 232.880 4 4 4 4 4 4 4

Subtotal: 10

1" M

eter

s1

1/2"

Met

ers




ly-0

9

Aug

ust-0

9

Sep

tem

ber-

09

Oct

ober

-09

Nov

embe

r-09

Dec

embe

r-09

Janu

ary-

10

Febr

uary

-10

Mar

ch-1

0

Apr

il-10

May

-10

June

-10 Average Number

Users in Each Class

0 999 0.079 2 2 2 2 2 2 22,000 2,999 2.000 1 1 1 1 1 1 14,000 4,999 4.000 1 1 1 1 1 1 15,000 5,999 5.000 1 1 1 1 1 1 18,000 8,999 8.000 1 1 1 1 1 1 1

10,000 14,999 10.500 1 1 1 1 1 1 120,000 24,999 23.333 1 1 1 1 1 1 125,000 29,999 25.667 1 1 1 1 1 1 130,000 34,999 31.571 1 1 1 1 1 1 135,000 39,999 37.667 1 1 1 1 1 1 140,000 44,999 42.375 1 1 1 1 1 1 145,000 49,999 46.857 1 1 1 1 1 1 160,000 64,999 63.000 1 1 1 1 1 1 165,000 69,999 68.333 1 1 1 1 1 1 170,000 74,999 71.667 1 1 1 1 1 1 180,000 84,999 82.000 1 1 1 1 1 1 185,000 89,999 86.667 1 1 1 1 1 1 190,000 9,999,999 350.322 25 25 25 25 25 25 25

Subtotal: 430 999 0.500 0.0 0.0 0.0 0.0 0.0 0.0 0

35,000 39,999 35.000 0.2 0.2 0.2 0.2 0.2 0.2 090,000 9,999,999 708.118 2.8 2.8 2.8 2.8 2.8 2.8 3

Subtotal: 30 999 0.000 0.3 0.3 0.3 0.3 0.3 0.3 0

1,000 1,999 1.225 0.2 0.2 0.2 0.2 0.2 0.2 02,000 2,999 2.250 0.2 0.2 0.2 0.2 0.2 0.2 03,000 3,999 3.500 0.0 0.0 0.0 0.0 0.0 0.0 04,000 4,999 4.750 0.2 0.2 0.2 0.2 0.2 0.2 05,000 5,999 5.300 0.2 0.2 0.2 0.2 0.2 0.2 0

15,000 19,999 16.750 0.3 0.3 0.3 0.3 0.3 0.3 020,000 24,999 21.100 0.3 0.3 0.3 0.3 0.3 0.3 025,000 29,999 28.750 0.2 0.2 0.2 0.2 0.2 0.2 0

Subtotal: 20 999 0.000 0.7 0.7 0.7 0.7 0.7 0.7 1

10,000 14,999 11.550 0.2 0.2 0.2 0.2 0.2 0.2 015,000 19,999 17.500 0.0 0.0 0.0 0.0 0.0 0.0 0

Subtotal: 10 999 0.000 1 1 1 1 1 1 1

1,000 1,999 0Subtotal: 1

Average for the Year 946

488 488 488 488 488 488 488

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Sept

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Extra Service Units

2" M

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Rockbridge County PSAChart 16A - Rates During Test Year CBGreatRates© Version 5.2These charts show current rates, starting reserve balances and activity, and incomes for the test year.



Median or Actual Average use in 1,000 Gallons

Base Minimum Charge

Usage Allowance in

1,000 Gallons


Gallons0 999 0.000 $13.56 0.000 $0.00

1,000 1,999 1.500 $13.56 0.000 $0.002,000 2,999 2.500 $13.56 0.000 $0.00

0 999 0.000 $97.56 0.000 $0.001,000 1,999 1.500 $97.56 0.000 $0.002,000 2,999 2.500 $97.56 0.000 $0.00

0 999 0.202 $13.56 0.000 $7.001,000 1,999 1.437 $13.56 0.000 $7.002,000 2,999 2.440 $13.56 0.000 $7.00

90,000 9,999,999 202.290 $13.56 0.000 $7.00

0 999 0.082 $36.48 0.000 $7.001,000 1,999 1.020 $36.48 0.000 $7.00

90,000 9,999,999 175.249 $36.48 0.000 $7.00

0 999 0.500 $83.36 0.000 $7.001,000 1,999 1.000 $83.36 0.000 $7.002,000 2,999 2.000 $83.36 0.000 $7.00

90,000 9,999,999 232.880 $83.36 0.000 $7.00

0 999 0.079 $154.66 0.000 $7.001,000 1,999 1.000 $154.66 0.000 $7.002,000 2,999 2.000 $154.66 0.000 $7.00

90,000 9,999,999 350.322 $154.66 0.000 $7.00

0 999 0.500 $298.08 0.000 $7.001,000 1,999 1.500 $298.08 0.000 $7.002,000 2,999 2.500 $298.08 0.000 $7.00

90,000 9,999,999 708.118 $298.08 0.000 $7.00

0 999 0.500 $465.78 0.000 $7.001,000 1,999 1.500 $465.78 0.000 $7.002,000 2,999 2.500 $465.78 0.000 $7.00

90,000 9,999,999 5,045.000 $465.78 0.000 $7.00

0 999 0.000 $2.24 0.000 $80.001,000 1,999 1.225 $2.24 0.000 $80.002,000 2,999 2.250 $2.24 0.000 $80.00

90,000 9,999,999 5,045.000 $2.24 0.000 $80.00

0 999 0.000 $2.24 0.000 $100.001,000 1,999 1.500 $2.24 0.000 $100.002,000 2,999 2.500 $2.24 0.000 $100.00

90,000 9,999,999 5,045.000 $2.24 0.000 $100.00

0 999 0.000 $0.00 0.000 $0.001,000 1,999 0.000 $0.00 0.000 $0.00

Extra Service Units NA $0.00 NA NA

3" M

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Sep

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Sep

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Mai

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Met

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1 1/

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Rockbridge County PSAChart 16B - Reserves, AMHI CBGreatRates© Version 5.2

Reserve Starting Balances as of 7/1/09 and Debits and Credits*

$497,099 Cash & Cash Equivalents $ 437,653.69 Replacement Funds

$0 CIP & Debt Reserves


$45,803 AMHI for Rockbridge County PSA for the year 2009, by Census estimate

2.7% Historical rate of growth in AMHI for Rockbridge County PSA

Chart 16C - IncomesThis chart shows incomes for the test year.

Incomes for 7/1/09 Through 6/30/10

$963,451 Sewer and Septage Sales

$9,879 Late Charges, Penalties

13 Number New Hookups$972,176

$211 Average New Hookup Fee

$2,744 Hookup Fee

$6,355 Interest$0

$0 Surcharge Fees

$80,150 Availability Fees

$1,293 Reconnection

$188 Inspection Charge

$2,340 Account Charge

$1,978 Misc & Bad Check Revenue

-$138 Bad Debt

$1,068,238 Total Regular Income

Hookup Fee dedicated to cap improvements:

This chart shows starting reserve balances and activity not shown elsewhere and median household income for the test year.

Predicted billable user fees:

Rockbridge County PSA, Sewer Rates Scenario 1Chart 17A - Equipment Replacement Details ChartThis schedule depicts detailed equipment replacement and refurbishment during the next 20 years.CBGreatRates© Version 5.2, Replacement Scheduler© Version 1.4

Year Beginning

Computer Equipment/Basic Software

Rehab Manholes

(10ft)

Sewer Portion of

Meters TelemetryRt 60 Sewer

MeterBirdfield

Sewer Meter Deep Hole Sliplining Handhelds

Pump Impellers & Assemblies

2/yr1" Gas Trash

Pump Weed Eater Pickup Truck

7/1/09 $1,000 $0 $489 $0 $0 $0 $3,323 $0 $0 $0 $190 $0 $8,717

7/1/10 $2,500 $0 $6,350 $0 $0 $0 $321,677 $0 $0 $0 $0 $0 $0

7/1/11 $1,000 $1,500 $0 $92,148 $0 $45,000 $0 $0 $0 $0 $0 $225 $0

7/1/12 $1,000 $1,500 $0 $0 $45,000 $0 $0 $30,000 $0 $3,600 $0 $0 $0

7/1/13 $1,000 $1,500 $0 $0 $0 $0 $0 $0 $6,000 $3,600 $0 $0 $0

7/1/14 $1,000 $1,500 $0 $0 $0 $0 $0 $30,000 $0 $3,600 $190 $0 $0

7/1/15 $1,000 $1,500 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $10,000

7/1/16 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $0 $0 $225 $0

7/1/17 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $3,600 $0 $0 $0

7/1/18 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $6,000 $3,600 $0 $0 $0

7/1/19 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $3,600 $190 $0 $0

7/1/20 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $0 $0 $0 $0

7/1/21 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $0 $0 $225 $10,000

7/1/22 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $3,600 $0 $0 $0

7/1/23 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $6,000 $3,600 $0 $0 $0

7/1/24 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $3,600 $190 $0 $0

7/1/25 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/26 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $0 $0 $225 $0

7/1/27 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $3,600 $0 $0 $10,000

7/1/28 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $6,000 $3,600 $0 $0 $0

7/1/29 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $3,600 $190 $0 $0

7/1/30 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $0 $0 $0 $0

7/1/31 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $0 $0 $0 $225 $0

7/1/32 $1,000 $1,500 $6,000 $0 $0 $0 $0 $30,000 $0 $3,600 $0 $0 $0

7/1/33 $1,000 $1,500 $6,000 $0 $0 $0 $0 $0 $6,000 $3,600 $0 $0 $10,000

Replacement Scheduler Version 1.4, copyright 2008. The program itself may not be copied but report output may be so long as credit is ascribed to the developer, Carl E. Brown of Carl Brown Consulting, LLC.

Rockbridge County PSA, Sewer Rates Scenario 1Chart 17A - Equipment Replacement Details Chart

Year Beginning

Pick Up Truck

Pick Up Truck

Pick Up Truck

Pick Up Truck

Billing Software

Data Logger & Software

Accounting Software

Inventory Software

Gas Pipe Saw

AC Pipe Cutter

Liquid Level Controller

Shop Upgrades

Pump Stations, etc.

7/1/09 $0 $0 $0 $0 $7,790 $0 $0 $0 $0 $625 $0 $0 $0

7/1/10 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,200 $0 $0

7/1/11 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/12 $0 $10,000 $0 $0 $0 $5,000 $0 $0 $600 $0 $0 $0 $0

7/1/13 $0 $0 $10,000 $0 $0 $0 $2,500 $0 $0 $0 $0 $0 $0

7/1/14 $0 $0 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/15 $0 $0 $0 $0 $0 $0 $0 $375 $0 $0 $0 $5,000 $5,000

7/1/16 $0 $0 $0 $0 $7,790 $0 $0 $0 $0 $0 $0 $0 $0

7/1/17 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/18 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/19 $0 $0 $10,000 $0 $0 $5,000 $0 $0 $0 $625 $0 $0 $0

7/1/20 $0 $0 $0 $10,000 $0 $0 $2,500 $0 $600 $0 $5,200 $0 $0

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/22 $0 $0 $0 $0 $0 $0 $0 $375 $0 $0 $0 $0 $0

7/1/23 $10,000 $0 $0 $0 $7,790 $0 $0 $0 $0 $0 $0 $0 $0

7/1/24 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/25 $0 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $5,000 $5,000

7/1/26 $0 $0 $0 $10,000 $0 $5,000 $0 $0 $0 $0 $0 $0 $0

7/1/27 $0 $0 $0 $0 $0 $0 $2,500 $0 $0 $0 $0 $0 $0

7/1/28 $0 $0 $0 $0 $0 $0 $0 $0 $600 $0 $0 $0 $0

7/1/29 $10,000 $0 $0 $0 $0 $0 $0 $375 $0 $625 $0 $0 $0

7/1/30 $0 $10,000 $0 $0 $7,790 $0 $0 $0 $0 $0 $5,200 $0 $0

7/1/31 $0 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/32 $0 $0 $0 $10,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/33 $0 $0 $0 $0 $0 $5,000 $0 $0 $0 $0 $0 $0 $0


Year Beginning

Handheld Radios

Director's Vehicle Dump Truck Backhoe

Small TLB Tractor

Air Compressor,

Jack Hammer, Bits Brush Hog Trailer

Portable Generator

Service Truck

Small Tool Generator

Electrical Panel

Willow Springs

Generator

7/1/09 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/10 $0 $12,500 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/11 $0 $0 $0 $0 $20,000 $0 $0 $0 $0 $0 $0 $0 $0

7/1/12 $0 $0 $0 $0 $0 $0 $0 $0 $16,500 $0 $300 $0 $0

7/1/13 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/14 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/15 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/16 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/17 $2,850 $0 $38,000 $0 $0 $0 $0 $4,350 $0 $0 $0 $0 $0

7/1/18 $0 $0 $0 $38,000 $0 $0 $1,500 $0 $0 $0 $0 $0 $80,000

7/1/19 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/20 $0 $12,500 $0 $0 $0 $4,800 $0 $0 $0 $0 $0 $0 $0

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/22 $0 $0 $0 $0 $0 $0 $0 $0 $0 $20,000 $0 $0 $0

7/1/23 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $10,000 $0

7/1/24 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/25 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/26 $0 $0 $0 $0 $20,000 $0 $0 $0 $0 $0 $0 $0 $0

7/1/27 $2,850 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/28 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/29 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/30 $0 $12,500 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/31 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

7/1/32 $0 $0 $38,000 $0 $0 $0 $0 $4,350 $16,500 $0 $300 $0 $0

7/1/33 $0 $0 $0 $38,000 $0 $0 $1,500 $0 $0 $0 $0 $0 $0


Year Beginning

NBS Generator

Rt 251(use portable?) Generator Welder Sewer Jet

W&S shoring equip-20 yr

Sm. Trench Box

Adjustment to Balance

Total Annual Replacement

Costs

7/1/09 $0 $0 $0 $0 $0 $0 $5,676 $0 $0 $0 $0 $0 $27,809

7/1/10 $0 $0 $0 $0 $0 $0 -$220,450 $0 $0 $0 $0 $0 $127,777

7/1/11 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $169,873

7/1/12 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $113,500

7/1/13 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $24,600

7/1/14 $0 $0 $0 $0 $0 $2,500 $0 $0 $0 $0 $0 $0 $48,790

7/1/15 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $22,875

7/1/16 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $46,515

7/1/17 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $67,300

7/1/18 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $177,600

7/1/19 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $27,914

7/1/20 $80,000 $0 $1,250 $130,000 $0 $0 $0 $0 $0 $0 $0 $0 $285,350

7/1/21 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,725

7/1/22 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $62,475

7/1/23 $0 $80,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $125,890

7/1/24 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $52,290

7/1/25 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $28,500

7/1/26 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $86,325

7/1/27 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $27,450

7/1/28 $0 $0 $0 $0 $1,750 $0 $0 $0 $0 $0 $0 $0 $50,450

7/1/29 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $23,289

7/1/30 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $73,990

7/1/31 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,725

7/1/32 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $111,250

7/1/33 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $72,600

Rockbridge County PSA, Sewer Rates Scenario 1Chart 17 - Replacement Schedule CBGreatRates© Version 5.2, Replacement Scheduler© Version 1.4

This schedule calculates the annual annuity to fund all replacement and refurbishment from the detailed schedule.4.00% Average Inflation Rate for the Following Sewer System Equipment for the Term of This Replacement Schedule 1.00% Average Interest Rate on Balances Invested for the Term of This Replacement Schedule 4.00% Average Interest Rate on Amounts Borrowed for the Term of This Replacement Schedule

Year Beginning Item Description

This Year's Costs in

Current Dollars

One-time Transfers From Operating Fund

One-time Transfers to

Operating Fund

End of Year Balance in Future

Dollars

Minimum Desired End of

Year Balance in Future Dollars

7/1/09 Test year replacements $27,809 $32,135 $0 $446,357 $158,749

7/1/10 Total of replacements from detailed replacement schedule $127,777 $30,742 $0 $458,251 $165,099




















Starting Account Balance $437,654 $158,749

Minimum Annual Annuity $90,347

Discretionary Annuity $18,000

Required Annual Deposit to Replacement Account $108,347

Minimum Desired Balance in Today's

Dollars

Notes: This schedule summarizes equipment replacements detailed elsewhere.The minimum desired balance is twice the average annual replacement cost amount. The required annual deposit was calculated based upon these assumptions.

Rockbridge County PSAChart 18 - All-in Test Year Costs and Rate Structure Calculations CBGreatRates© Version 5.2

Operating Costs

Item Amount

% of This Cost

That is Fixed

% of This Cost

That is Variable

Total Costs After

Adjustment for Special Costs

Below

Fixed Costs After

Adjustment for Extra

Service Unit Costs

Variable Costs

Extra Service Unit Costs, if

Applicable, From Chart

18BAdministration Salaries, Benefits, etc. $66,481 100.0% 0.0% $66,481 $64,219 $0 $2,262

Operations Salaries, Benefits, etc. $120,206 25.0% 75.0% $120,206 $19,825 $90,155 $10,227

Licenses & Permits $218 100.0% 0.0% $218 $144 $0 $74

Maintenance of Sewer Mains $2,355 0.0% 100.0% $2,355 $0 $2,355 $0

Sewage Treatment by Contract $457,079 0.0% 100.0% $457,079 $0 $457,079 $0

O&M Sewer Pumping Equip $5,808 0.0% 100.0% $5,808 $0 $5,808 $0

Power for Pumping Sewer $13,086 0.0% 100.0% $13,086 $0 $13,086 $0

O&M of Sewer Buildings $96 25.0% 75.0% $96 $16 $72 $8

Sewage Chem. Supplies & Exp. $5,971 0.0% 100.0% $5,971 $0 $5,971 $0

Sewer Services $2,157 25.0% 75.0% $2,157 $539 $1,618 $0

Maintenance of Meters $887 0.0% 100.0% $887 $0 $887 $0

Bank Service Charge-S $204 100.0% 0.0% $204 $197 $0 $7

Uncollected Sewer Expenses $2,309 25.0% 75.0% $2,309 $577 $1,732 $0

Office Supplies, Software, Phone, Pager $4,489 100.0% 0.0% $4,489 $4,337 $0 $153

Financial, Legal, Payroll Contract $468 100.0% 0.0% $468 $453 $0 $16

Insurance Premiums-S $7,052 100.0% 0.0% $7,052 $6,812 $0 $240

Transportation (Vehicles)-S $5,395 25.0% 75.0% $5,395 $1,303 $4,046 $46

Board Members Comp/Travel-S $986 100.0% 0.0% $986 $651 $0 $336

Uniform Rental, Dues, Subscrip, Training, Misc $1,744 25.0% 75.0% $1,744 $288 $1,308 $148

O&M of General Equip/Prop-S $5,945 25.0% 75.0% $5,945 $980 $4,459 $506

Postage-S $2,463 100.0% 0.0% $2,463 $1,625 $0 $838

Outside Services-Mowing-S $3,060 100.0% 0.0% $3,060 $2,019 $0 $1,041

Engineering-Nonconstruction-S $0 25.0% 75.0% $0 $0 $0 $0

Surchargeable Services Except Extra Service Units NA 0.0% 100.0% $0 $0 $0 $0

Inflow and Infiltration NA 0.0% 100.0% $0 $0 $0 $0

One-time Transfer to Replacement Funds $32,135 25.0% 75.0% $32,135 $8,034 $24,101 $0

Annual Payment to Replacement Funds $108,347 25.0% 75.0% $108,347 $27,087 $81,260 $0

User Charge Analysis Services $0 100.0% 0.0% $0 $0 $0 $0

Debt Service $0 50.0% 50.0% $0 $0 $0 $0

Grand Total All Costs $848,944 $848,944 $139,104 $693,937 $15,902

Cost Calculations for "Proportional" Rates $848,944

Fixed Cost/User Every Other Month = $27.31$0

0%

Percentage of Inflow and Infiltration to Allocate to Fixed Costs is 0%

56%

$0

Test Year Usage Metered Through Customer Meters 123,283,440 Gallons

+ Test Year Inflow and Infiltration 0 Gallons

= Total Test Year Volume 123,283,440 Gallons

Surchargeable Services are Estimated at

Inflow and Infiltration is Estimated at

As Compared to Service Sold, the Relative Cost of Inflow and Infiltration is Estimated at

Resulting Cost of Inflow and Infiltration

This chart depicts all costs for the test year and distributes those costs to fixed and variable categories for the purpose of calculating the "proportional to use" rate structure (see Definitions).

Variable Costs (Cost to Produce)/1,000 Gallons Sold = $5.63

Gallons/Billing Cycle Used by Average General Customer = 7,137

Rockbridge County PSAChart 18B - Test Year Extra Service Unit Costs CBGreatRates© Version 5.2

Item

Fixed Costs After

Adjustment for Special

Costs (From Chart 18)

Proportional Benefit that Accrues to

Extra Service Units*

% That Extra Service Units are of Total # of Customers

% of This Cost to

Charge to Extra Service

UnitsExtra Service

Unit CostsAdministration Salaries, Benefits, etc. $66,481 10.0% 34.0% 100.0% $2,262

Operations Salaries, Benefits, etc. $30,052 100.0% 34.0% 100.0% $10,227

Licenses & Permits $218 100.0% 34.0% 100.0% $74

Maintenance of Sewer Mains $0 100.0% 34.0% 100.0% $0

Sewage Treatment by Contract $0 100.0% 34.0% 100.0% $0

O&M Sewer Pumping Equip $0 100.0% 34.0% 100.0% $0

Power for Pumping Sewer $0 100.0% 34.0% 100.0% $0

O&M of Sewer Buildings $24 100.0% 34.0% 100.0% $8

Sewage Chem. Supplies & Exp. $0 100.0% 34.0% 100.0% $0

Sewer Services $539 0.0% 34.0% 100.0% $0

Maintenance of Meters $0 100.0% 34.0% 100.0% $0

Bank Service Charge-S $204 10.0% 34.0% 100.0% $7

Uncollected Sewer Expenses $577 0.0% 34.0% 100.0% $0

Office Supplies, Software, Phone, Pager $4,489 10.0% 34.0% 100.0% $153

Financial, Legal, Payroll Contract $468 10.0% 34.0% 100.0% $16

Insurance Premiums-S $7,052 10.0% 34.0% 100.0% $240

Transportation (Vehicles)-S $1,349 10.0% 34.0% 100.0% $46

Board Members Comp/Travel-S $986 100.0% 34.0% 100.0% $336

Uniform Rental, Dues, Subscrip, Training, Misc $436 100.0% 34.0% 100.0% $148

O&M of General Equip/Prop-S $1,486 100.0% 34.0% 100.0% $506

Postage-S $2,463 100.0% 34.0% 100.0% $838

Outside Services-Mowing-S $3,060 100.0% 34.0% 100.0% $1,041

Engineering-Nonconstruction-S $0 100.0% 34.0% 100.0% $0

Inflow and Infiltration $0 0.0% 34.0% 100.0% $0

One-time Transfer to Replacement Funds $8,034 0.0% 34.0% 100.0% $0

Annual Payment to Replacement Funds $27,087 0.0% 34.0% 100.0% $0

User Charge Analysis Services $0 0.0% 34.0% 100.0% $0

Debt Service $0 10.0% 34.0% 100.0% $0Grand Total All Costs $155,007 $15,902

As compared to fixed costs, extra service unit costs accrue at the following average rate: 19.9%

Resulting Cost/Service Unit Every Other Month: $5.43

This chart depicts costs that extra service units cause the system to incur. Such units are commonly apartments within an apartment complex where only the owner is billed for service, mobile homes within a mobile home park where only the park operator is billed, shops within a stip mall where only the mall operator is billed, etc.

* Compared to customers of record, extra service units get this percentage of benefit out of each of these cost items.

(This is the dollar benefit a single service unit receives from these fixed costs.)








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Rockbridge County PSA, Sewer Rates Scenario 2Chart 1 - Proposed Rate Chart CBGreatRates© Version 5.2







Gallons0 999 $124.22 0.000 $0.00

1,000 1,999 $124.22 0.000 $0.00 2,000 2,999 $124.22 0.000 $0.00

90,000 9,999,999 $124.22 0.000 $0.000 999 $29.89 0.000 $7.86

1,000 1,999 $29.89 0.000 $7.86 2,000 2,999 $29.89 0.000 $7.86

90,000 9,999,999 $29.89 0.000 $7.860 999 $61.46 0.000 $7.86

1,000 1,999 $61.46 0.000 $7.86 90,000 9,999,999 $61.46 0.000 $7.86

0 999 $102.54 0.000 $7.86 1,000 1,999 $102.54 0.000 $7.86 2,000 2,999 $102.54 0.000 $7.86

90,000 9,999,999 $102.54 0.000 $7.860 999 $160.04 0.000 $7.86

1,000 1,999 $160.04 0.000 $7.86 2,000 2,999 $160.04 0.000 $7.86

90,000 9,999,999 $160.04 0.000 $7.860 999 $324.34 0.000 $7.86

1,000 1,999 $324.34 0.000 $7.86 2,000 2,999 $324.34 0.000 $7.86

90,000 9,999,999 $324.34 0.000 $7.860 999 $554.36 0.000 $7.86

1,000 1,999 $554.36 0.000 $7.86 2,000 2,999 $554.36 0.000 $7.86

90,000 9,999,999 $554.36 0.000 $7.860 999 $4.98 0.000 $80.00

1,000 1,999 $4.98 0.000 $80.00 2,000 2,999 $4.98 0.000 $80.00

90,000 9,999,999 $4.98 0.000 $80.000 999 $4.98 0.000 $100.00

1,000 1,999 $4.98 0.000 $100.00 2,000 2,999 $4.98 0.000 $100.00

90,000 9,999,999 $4.98 0.000 $100.00Extra Service Units $0.00 0.000 $0.00Note: Rates for volume classes not shown are the same as adjacent rates.

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Rockbridge PSA, VA Rate Analysis Report 1 · rockbridgtr cotjnty pi-]blic servictr at]thority 150...

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