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<br />DRAFT REPORT <br /> <br />IT!. ANALYSIS OF TEST YEAR DATA <br /> <br />A. Water Utility System Data <br />The City maintains daily treated water production data at the treatment plant. Over the last six <br />fiscal years, the City's peak to average day ratio has ranged from a high of 1.77 in FY 2000 to a <br />low of 1.50 in FY 2004. However, due to Tenaska Ill's change in its consumption pattern, (i.e. <br />lower average day use with similar peak day demand) it is anticipated that the peak to average <br />day ratio will increase. Table A-I in Appendix A shows the system demand and capacity factors <br />for the test year, reflecting the change in Tenaska Ill's consumption pattern. <br /> <br />B. Allocation Operation and Maintenance Expenses to Functional Cost Components <br />In order to recognize that certain facilities of the City's water utility system are used in common <br />by two, three, four or all five of the customer classes identified in Section II, five customer <br />groups have been formed for system cost allocation purposes. These cost factors have also been <br />separated into three principal components of Base, Extra Capacity, and Customer costs to <br />provide a means of further distributing functionalized costs to the various customer classes on <br />the basis of the respective responsibilities of each group for each particular cost function. <br /> <br />Each element of cost is allocated to functional cost components of the system on the basis of the <br />parameter or parameters having the most significant influence on the magnitude of the element <br />of cost. Operation and maintenance expenses are allocated directly to appropriate cost <br />components. Similarly, debt service costs are allocated to the appropriate cost functions. <br /> <br />C. Distribution of Functionalized Cost Components to Customer Groups <br />This is the final step in determining the revenue requirement of each individual group of <br />customers from the total revenue requirement of the water system as a whole. The <br />functionalized cost factors are determined for each individual customer group on the basis of <br />each group's annual usage characteristics. <br /> <br />City of Paris, Texas <br />Water and Wastewater Cost of Service Study <br />May 2005 <br /> <br />8 <br />