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Watson & Associates Economists Ltd. 3.
Review with Municipality personnel prior to proceeding with rate determination. This discussion
will address potential short to medium term impacts of utilizing alternative capital financing
methods as a means of controlling rate levels.
1.4 Operating Cost and Revenue Analysis (Task #4)
Review and update operating costs and related annual cost components such as maintenance
costs, testing, engineering/administration, reading/billing/collecting, etc. Break down into fixed and
variable components.
• From the future forecasts identified in Task #2, assess potential cost implications. Identify
sensitivity impacts (fixed vs. variable cost factors) and cost drivers.
• Provide discussion on reserve funds for various purposes (i.e. working fund, rate stabilization, life
cycle, etc).
1.5 Rate Calculations (Task #5)
• Water and wastewater billings are currently calculated using a base charge (determined by meter
size) and a consumption charge. Current 2012 rates are as follows:
The water and wastewater rates will be updated using the rate structure (noted above) as
implemented in the previous rate study. Also, other rate structures can be discussed with staff,
as requested.
1.6 Report Preparation (Task #6)
Finalize the long term plans prepared as part of previous tasks for capital (existing system/future)
and operating needs from a value engineering and/or long-term life cycle perspective.
Prepare a capital/operating implementation plan from a technical and cost perspective.
Provide the findings of the analysis in a letter report.
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H:\PROPOSAL\Lambton Shores\2012 DC W&WW\W & WW\Lambton Shores 2012 WWW Proposal.doc