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City of Santa Ana, CA 1 SANITARY SEWER AND WATER FINANCIAL PLAN <br />5.3 Classify plant investment to the functional <br />costs categories such as supply, collection, <br />pump stations, treatment, transmission, <br />distribution, and meters. <br />5.4 Classify operating, administrative, <br />engineering, 0&M, power, etc. to the <br />functional costs categories identified in <br />subtask 5.3. <br />5.5 <br />Allocate the classified costs of the sanitary <br />sewer and water systems to the customer <br />classes based on the cost components identified in subtask 5.2. <br />5.6 Estimate class service characteristics associated with each of the <br />functional cost elements by recognizing the bill distribution <br />analysis performed in subtask 3.2. <br />53 Develop unit costs of service based on the cost allocations. The <br />unit costs of service are applicable to all system users and each <br />class' proportional responsibility for total system costs. The <br />relative responsibility of each class customer will be specifically <br />determined based on each class' estimated service requirements. <br />5.6 Prepare a comparison of class revenues under existing rates with <br />allocated class costs of service to determine the level of cost <br />recovery by class, and in total, and to demonstrate any needed <br />adjustments to align class revenues and allocated costs. <br />Task 6-- Rate Design <br />The objective of this task is to evaluate the City's existing rates and <br />identify potential modifications to the rates and rate structures. As part of <br />this task, an analysis of the City's billing system capability will be <br />incorporated. In general the design of rates and rate structures intend to <br />accomplish the following: <br />» Be consistent with all applicable laws, statues, rules and regulations <br />governing fees, rates, and charges such as Proposition 218. <br />Address revenue sufficiency, stability, customer clarity, price signaling, <br />and water conservation goals as set forth in SBx7-7. <br />Specific subtasks are: <br />6.1 Analyze the existing rate structure and develop alternative rate <br />structures that address, at minimum, the following: <br />R; A rate structure that incorporates water conservation rate <br />programs <br />BLACK & VEATCH I Methodology <br />25D-19