Okay, welcome to our public meeting regarding our rate case. Today, we are gonna go a little more in
depth into the rate case. We are joined today by Jennifer Wilson, our consultant with Crow, who's gonna
review our revenue requirements report. We are joined by consultants from Stantec, who will review our
cost of service study and rate allocation. And we also have Mark Menafee, our capital projects engineer.
and Matt Havy, our Assistant Director of Finance to help answer any questions people may have. With that,
I'll hand it off to Jennifer. Thank you, Kat. I'm Jennifer Wilson with Crow, and I have served as the
rate consultant to prepare the revenue requirement analysis for Bloomington Water Utility. Next slide, please.
As part of our task, we go in and we look at 2022, 2023, and 2024
and we look at the balance sheet and all the other financial statements of the utility. We use the year
end 2024 as the test year, and we made adjustments to it for fixed known and measurable changes,
which then computes to the revenue requirements of the operation and maintenance expenses, current and
proposed debt and lease payments, and annual extensions and replacements, which is paying for capital
items with cash. Next tab.
Some of the key considerations out of doing the study is that you have $84 million worth of projects
that need to be done. And we have proposed two bond issuances that will fund 54.5 million of those projects.
The rest of it will be funded with cash on hand as the revenues come in year over year. And we're having that,
that's called extensions and replacements. And that will be increased to $7.1 million of annual funding
from revenues each year.
Next slide. When we looked at the operation and maintenance expenses as compared to revenues, the first
columns of lines there, the first one is 2022 and the revenues came in about $20 million and the expenses
were 18.1.
which meant that the utility had about $1.9 million of annual funding of capital improvements.
And as I said before, we're gonna increase that up to $7.1 million. The set next year in 2023,
it was a negative $1.9 million. And in 2024, there was $3.8 million as there was a rate increase in
the beginning of the year 2024. Next slide.
We've looked at the year of 2024 and made adjustments for fixed known and measurable items and then
include the payment of shared services and pilot. So there was about $3.2 million worth of adjustments
that we made from the test year to what a pro forma year is gonna be in 2025. Next slide. This graph
shows operation and maintenance and taxes and what that
a total of $14.9 million of operation and maintenance and taxes goes towards. So a majority of it, 42%,
is going towards employee costs for salaries and wages and the related employee costs related to that.
Purchase power is about 11% of that total. And you can see the other lines dividing out what those other
expenses are. Next, Pam.
As I said, there's a capital improvement plan of $84 million. We are funding $54 million with bonds
and those two bonds will be done in 2026 and 2028. Our goal, which I'll show it here in the next slide
is that we are doing capitalized interest when we fund those bonds so that we're not increasing debt
service and we'll be utilizing the debt roll off and I'll show that in the next slide. But we are funding
about 28 million
with cash on hand over that four year time period. Next slide. The next one. There we go. This is the debt.
And so currently the debt service is at $7.1 million and will continue that way until the year 2029.
And then it drops down to $1.7 million. We're taking that opportunity to fund
$54.5 million worth of projects by financing those projects through two series of bond issues so that
the debt service goes back up to $7.1 million and is maintained at that level for a number of years.
So basically we're filling in the reduction in debt service with the issuance of new debt and thus being
able to get a lot of the improvements that Kat will talk about. Next slide.
Here's the total revenue requirements. The big dark blue one is the operation and maintenance expenses,
and that's at $14.4 million. Taxes is $475,000. Debt service, as I said, is at $7.1 million right now,
and will continue that way after the issuance of debt. And then annual extensions and replacements,
which is funding for capital projects with cash as it comes in each year, is gonna be set at 7.1 million.
That's a total of $29.1 million of revenue requirements. We currently are bringing in 22.6 million.
So that's a deficit of $6.5 million that needs to be made up with rates. So we're proposing a revenue
increase of 30.5%. Now that does not mean everyone's bill will go up 30.5%. What that means is that
we need revenues to go up 30.5%
the next person that will be speaking, Stantec, they have prepared a cost of service study to allocate
those expenses to the customer classes that are causing those expenses so that those that are causing
the expenses will have a larger increase than 30.5 and those classes that are not, might not see a 30.5%
increase. So that's a long way of saying that rates are determined by the cost of service study.
That's my presentation. And at this point, I'm going to hand it over to Stantec, who prepared,
who's the cost of service study expert. So Andy or Danica? Good evening, everyone. Danica Katz with Stantec.
We also have Andy Burnham on from Stantec as well. As Jennifer mentioned, as well as Kat, this evening
we're going to be presenting on the cost allocation and rate design
component of this rate case and we'll step through each of those pieces. So next slide please. All right,
I just want to highlight here some of the objectives of the cost of service analysis. So what we do
is we utilize the revenue requirements that Jennifer just talked through as our test year and as defined
by Crow, which ultimately flow into the cost of service analysis.
And what we do is we utilize that to go through all of the expenses, things of that nature, and go through
and functionalize those costs, and ultimately divvy those up by customer class. And the goal of that
is to determine the cost to serve each class compared to the
current revenues that are being collected by each of those classes. So ultimately, just to become consistent
with the cost of providing service for each of those customer classes. As we go through the study,
one of the big things I want to point out here is that for this pre-case, we've utilized city AMI or
automated metering infrastructure, which has really allowed us to use data-driven
data-driven customer data in order to come up with peaking factors that are specifically from that data.
We've also used 2024 billing records as a basis for the analysis. And then just also want to highlight
here that as we go through the cost of service process, this is very much along with AWWA industry guidance.
as we approach the base extra capacity methodology for this cost allocation. Next slide, please.
And so here's the cost of service summary that came out of our analysis. And as Jennifer mentioned,
you can see in that top right corner as well as in the blue bars, that 30.5% overall increase.
compared to the orange bar, which is the existing or current revenue for each of those customer classes
along the bottom axis there. So what that would show is there's a 19.8% increase for residential,
whereas general service may see slightly higher than that, at about 42%. It just shows that spread based
on the findings from the cost of service.
across those different customer classes. You can see public fire protection going down at that 17.2%.
And to Jennifer's point there that not everyone is seeing that 30.5% based on the cost of service findings
specific to those customer classes.
And so once we get through the cost of service summary and get to the findings there by customer class,
that ultimately drives the proposed rates that you're seeing here compared to the current rates that
are in place. On the left-hand side, you'll see the charges specific to the fixed component.
So the base charge that goes up by meter size.
So what you'll see there is starting at that smallest 5 eighths meter, currently at that $6.50.
And then you're seeing that proposed rate there on the right hand of that table at $8.16. And that scales
up by those meter sizes.
On the right hand side we showed the component for the usage or what's sometimes referred to as the
volumetric per thousand gallons. And so we've shown each of the individual customer classes as well
as their current and proposed rate. So you can see there for residential currently at that $4.38
and then the $5.31 under the cost of service or proposed
rates there and so forth, or IU master meter as well as wholesale general service and irrigation.
And we'll also be pulling all of this together kind of into a summary that shows some of those impacts
for some specific customers or more common customers for each of those classes. So we can jump to that
next slide, which should show those.
Oh, sorry, I forgot the public fire protection and private fire protection. So through the rate design,
we've also gone ahead and done something very similar to what we did on the regular rates and go ahead
and calculate those for the public from both inside city as well as outside city. And that leftmost
table also by meter size. And you can see there that those rates are
like decrease from the current rates and that is in line with the cost of service graph that you saw
in a couple of the prior slides. And then on the right side, we've got our private fire connections
or private fire lines by line size with the current rates there and then the proposed rate.
We should have the customer impacts. Perfect. So we wanted to show here some monthly bill impacts for
a residential customer at a five-case meter, that smallest meter size. So we've shown a handful of usages
in thousand gallons on that leftmost column, as well as that current bill, which would include the fixed
component, their volumetric usage charge,
as well as the public fire protection charge. So you can kind of see all of those tables that we just
looked at kind of all snapped together here to get the full picture of what those impacts would be.
So for someone who's using maybe 1,000 gallons, a smaller residential user, we'll see a $2.32
change for that monthly bill, which is about $17.8.
And then you can see for some of those larger users, just a slightly higher impact there on the dollar change.
And then next slide, we have something similar for the general service category, which includes
your commercial customers, industrial, interdepartmental customers of that type. And so we're showing
two different situations here at three-quarter inch meter, small, medium, and large, at that 1,000, 5,000,
and 10,000 increment. So for that small three-quarter inch commercial meter, maybe seeing about a $3.30
change there, or about a $22.
and a little bit higher on those larger meters with a little bit larger usage. And then also wanted
to show a one inch meter down below as well. Those are the two most common meter sizes for the general
surface category. So we're showing a 15,000 gallon, a 20,000 gallon, and a 25,000 gallon user there.
see that those charges are anywhere from $32.85 up to that $54. And these also contain the city public
fire protection charge as well. And next slide, I think that was all that we had. So happy to answer
any questions that may come up.
Next question. Should I go up there? Sure. I don't have to. You don't have to. Can I go back to that,
the graph slide you talked about, to set inches for each category? Yeah, absolutely. Glad you can hear me.
One more. There we go. That one there, yep. OK. The first question is just in terms of terminology.
I think we're used to seeing those commercial, industrial, interdepartmental broken out. And why is
it that those are grouped into general service now? Yeah, great question. So one of the pieces to this
analysis, specifically for the general service, with the AMI data that we have, we're able to go through
pretty data-driven
intense analysis on the AMI data and we're able to determine that the commercial and industrial classes
behaved very similarly when it came to their demands, usage, things of that nature, as well as the fact
that the industrial class is very small. I believe there's only 17 or 18 accounts specifically within
that class. And so through discussions, we talked with the city about consolidating that
Commercial and industrial into a general service class and so that's why you see those kind of rolled
up here in this presentation If you were to look at the current rates versus the proposed rates That's
the overall
percent increase in revenue for that customer class, not specifically the rate increases, because those
are dependent on the meter size and the usage and things of that nature. Right. Could we, sometime well
before the September 8 meeting, see the
percentage-wise increases in rates for the current rates versus these that are proposed. Yeah, absolutely.
So on the tables that are on the next slide, I'd like to see the percent changes there. Yeah. Yeah.
And I mean, this is a little bit of a bigger ask, but seeing the historical changes over our last few
rates increases would be useful as well, I think.
That's something that you wouldn't be responsible for, but maybe staff can do to show what's happened
historically. Yeah, we can work with staff to show something like that in there. And then let's go back
to that slide right before this one. Oh, sorry. So go back to that. I have one more question. I mean,
one you just had. Yeah. So when you show the two current rates for general service,
Are those the two for commercial and industrial? Correct. Yep. Yes, one of those represents the current
rate for industrial and the current rate for commercial. OK. I mean, it might be useful just to break
those out into two lines. General service used to be just two lines, I think, would be helpful for comparison
purposes. Anyway, yeah.
That's a lot. Thank you. Yeah, absolutely. Great question. And then, so I mean, I did this on my own
based on current rates and the new increases and what the percentage increases would be.
So if the residential rates are going up less than those of the other customer categories, is it
reasonable to say that our residential customers have been subsidizing these other customer classes.
I guess I'm being cautioned against drawing that kind of a conclusion because we really looked at a
test year and the customer usage characteristics and cost in that year and it's very well recognized that
We do these cost of service allocations. They are to a degree a snapshot in time. And so while we try
to normalize the test here, there can certainly be variances and fluctuations from one year to the next.
So I don't know that I'd necessarily draw a room for that conclusion, because we've not had a chance
to do that analysis to see what's really transpired in those years. But if you had the data from all
the years before, since the last rate increase, you'd be able to do that? I mean, in essence, you could
go back and do
a true up, if you will, based on actuals to say, well, how did our rates perform if we have the AMI
information for those historical periods? And the cost in the appropriate degree of detail, that type
of analysis could be performed. But there very well may be some data limitations in terms of the level
of precision you can do that with from the AMI system. That data, I don't know how far back that goes
to the last rate case, which was filed in 2021.
Sure, and the level of effort involved, I understand. Absolutely. Good one as well. OK. Well, are there
any instances where there's a proposed increase that doesn't fully account for the cost of any particular
customer class at this time?
I think I'll let Danica speak to it a little more specifically, but I do believe for the irrigation
and service classification, that does reflect the limitation of the increase for this particular case.
Is that in the report that we can have access to and read? At present, the report hasn't been prepared.
It will be developed as part of the application and filing materials.
be putting kind of the narrative together about the cost of service outcomes, but it will certainly
be identified in terms of what the full cost of service is for irrigation and what's been proposed this year.
I'll say this is a substantial step towards cost of service, but it's stopping just short of that,
recognizing the magnitude of the increase that's presented here. Thank you, sir. So just to clarify,
even though irrigation as a customer class has a very large increase and still not
enough to cover the entire cost of service. Yes. That's correct. Yes. Could someone maybe talk a little
bit about what that customer class is? Because I think when people see irrigation, they think, oh,
CBU knows that I'm using this water to water my lawn, which is, of course, not the case. That would be creepy.
So what is irrigation as a customer class?
Give us some examples so that we understand who these people are, whose rates are going to be increasing
the most. Sure. So our irrigation customer class is a mix of residential, general service, and IU.
We don't have any wholesale irrigation customers. This is based on irrigation meters. So there are specific
meters that are
irrigation only meters. And those meters are what are going to have these rates. So yes, CBU is not
able to know whether or not you're using your garden hose at home to water your garden. And that's not
what this is about. This is specifically for metered water that is specific to irrigation. So it's a
little more large scale type of irrigation. So Indiana University has some meters
that are irrigation meters. Yes. Those are built differently than Indiana University meters. Yes.
As long as we're bringing up Indiana University, last time around they were an intravenor. This time
around there were some required meetings that had to take place. I think the intent was to
Increase the probability that potential interveners might be, I don't know, more coordinated or on the
same page with the cost of service approach to avoid the need for an intervening case. Without speaking
on behalf of Indiana University, is CBU optimistic that this case is going to proceed without the kind
of intervention that we saw last time around?
I'm going to actually offer Dave McGimsey to answer that question. He's been helping us through the
legal process.
We don't know.
more for water here in Bloomington based on this proposed increase? We also had a few more slides to
explain the rate increases a little bit more.
to talk about our capital improvement projects. I didn't want to interrupt. There was good questions
happening. So I think we can go forward with that and then we can take some more questions after that.
All right. So just a little background on CBU. So we are a municipally owned water, wastewater and stormwater
utility service. We serve the residents of Bloomington and the surrounding area.
We operate under the guidance of a seven member utility service board and that board is appointed by
both the mayor and city council. We're responsible for the treatment and distribution of drinking water
for the city of Bloomington through the Monroe water treatment plant seen here. It has been owned and
operated since its construction in 1967. We are also the sole provider of water to Monroe County.
In addition to our water services, we also handle the collection, treatment, and disposal of wastewater
through the ownership and operation of two wastewater treatment facilities, Dillman Road wastewater
treatment plant and Blucher Pool wastewater treatment plant. This rate case is specifically for water though,
and this is specifically a water rate case which is not associated with sewer.
We also manage the collection and disposal of stormwater for the city of Bloomington. We currently employ
approximately 195 full and part-time employees, and we all work diligently to provide water quality
service to Bloomington residents, and our staff is very proud of the work that we do. So this is a slide
that Stantec had. I added to the side here
just to help with a little clarity what the difference between the current and proposed rates are for
both the fixed charges and usage charges for our different customer classes. So you may notice in our
fixed charges based on meter size, after one and one half meter and larger, the proposed rate actually
goes down. And that again is based off of the information we got from the cost of service study.
For our different customer classes, residential, we'll see their usage charge go up 93 cents. General service,
which again, we talked about commercial and industrial, we'll see their charges go up $1.85 and $2.12
respectively. Wholesale, we'll see an increase of $1.46 per unit. IU master meter, we'll see $1.77 increase.
and their non-master metered charges will go up $1.85. And then irrigation, which we discussed a bit
in our questions, will have an increase of $6 per unit. Again, a unit is 1,000 gallons of water.
Our public fire protection, which I wanted to kind of simplify a little bit. When you talk about public
fire protection, we're talking about
You know, the service of our hydrants, the cost to maintain those, to make sure that our emergency personnel
can reliably have that water when they need it. And so most customers have public fire protection.
And so all of the public fire protection rates have actually gone down because of the data provided
in our cost of service study.
And then next, we'll talk about the private fire protection. These rates have gone up. And what private
fire protection is is basically fire lines. So you imagine a building with a sprinkler system.
This is what private fire protection is versus the public fire protection.
Danica did a good job of looking at just kind of how your water bills would go up and looking at those
percent changes. For those of you who were here on Monday, you may recognize this slide. This is my own bill.
And so I just like to show how a regular single family residential users bill may change after this
rate increase.
And so my current charges for this past month with a small sanitation cart and using three units of
water was 7101. After our rate increase, or after the proposed rate increase, it would change to 7535.
The average for single-family residential usage is about 3.5 units.
But really we see anywhere between three and five being pretty standard bills for a single family residential
home. I also wanted to take a look at where our rates, where our proposed rates will put us in comparison
to cities and towns in Indiana with over 25,000 people population.
So our combined water and sewer rate is currently 24th out of these 39 cities and towns. The proposed
changes to water will only take us up to potentially 23. You may note in this slide, apologies if it's
hard to see, but every city or town that has a two next to it in parentheses, that means that there
is a proposed rate change for that city or town in the future. So this may shuffle and will likely shuffle
again lower in this list. Here's that same list, but now we're just looking at our water rate.
So our water rate right now puts us at 30th of 39, so we're in the lower third. This potential rate
increase for water will keep us still in that lower half of rates in the state of Indiana. All right,
and now I'm gonna take a moment to look at some of our capital improvement
plan projects. So I think one of the questions people ask is how much, and then the second question
they're going to ask is what are you going to use it for? So I'd like to present some of the projects
that we are planning to use these additional funds for. So first I'll start with water treatment plant
projects. In total, we're planning on spending $30.7 million in projects just at our water treatment plant.
These projects include electrical upgrades. These electrical upgrades will update our obsolete systems,
increase resiliency and provide enhanced cybersecurity at our plants. We also have a project to rehabilitate
our sedimentation basins. What this is and what this does is will restore critical water clarification
equipment. This is gonna improve the efficiency of our early treatment processes.
This project will enhance CB's ability to remove organic and inorganic materials from the raw water
drawn from Lake Monroe, helping us to address seasonal taste and odor issues. We'll also do some chemical
building improvements and feed line replacement. This addresses treatment reliability and staff safety,
along with restoring a safe and sustainable fluoride system.
We also have a project that will do high service pump rebuilds and variable frequency drives or VFDs.
Our high service pump rebuilds will provide redundancy and increase resiliency in our treatment processes.
The addition of these VFDs will help prevent service interruptions by preventing wear on the pipes at
the plant and throughout our system. Essentially how that works is instead of an on-off, it's variable and so
it's easier on our pipes. Additional water treatment plant projects include a maintenance project.
So this has miscellaneous maintenance projects, but it's a combination of multiple maintenance projects,
including the completion of an asset management system that will allow for our improved maintenance
assessment and replacement practices. This is gonna improve the longevity of our equipment.
We also have treatment plant water handling and delivery updates. What this does is it's gonna improve
the air quality monitoring to improve our worker safety. We'll see maintenance to address leaks in the
pipe gallery. There is also a replacement of a backwash header valve actuator. This will also provide
funds for items required tank inspections and maintenance.
And really a lot of this is about just maintaining, you know, a lot of this is repairs, a lot of this
is replacement, but if we don't have our funds for maintenance, you know, what are we doing?
So the last two projects here for water treatment.
at our water treatment plant. There's a bypass pumping improvement project. What this will do is increase
our resiliency by adding another way to withdraw from the lake should our main intake tower suffer a
severe failure. So this ensures continued water production. And then we have our residuals project.
This will increase generally the efficiency and consistency of our filter processes, helping us to maintain
water quality in
reliable treatment capacity. Next, we have projects that we are planning on doing in our distribution system.
These projects total $34.4 million and are in two main categories. The first category is our booster
stations and our storage tanks. We're gonna do rehabilitations and upgrades there. In addition to these
rehabilitations and upgrades, we're going to
at emergency generators that will improve our preparedness and reliability during natural disasters,
electrical grid issues, or other emergencies. Our second category is water main projects, maintenance,
testing, and replacement. Essentially, this is just to improve and maintain our ability to replace our
water mains, repair water mains, and
do our hydrant maintenance and testing. And then finally, we have $18.7 million, which is the water
funding portion for the proposed Winston Thomas Service Center. I think at multiple presentations this
year and the past year, I have discussed the fact that we are outgrowing our current facilities.
We are outgrowing them in regards to personnel, equipment, and adequate inventory storage. This will
be a purpose-built service center to improve logistics for field crews, allowing faster deployment and
better emergency response. It also allows for stronger protections of our capital assets, such as our
specialized service vehicles, which are currently being stored in the elements.
Building our service center that meets the utility's needs moving forward is an investment that will
save our resources over time. By investing now, CBU is setting up for operational excellence,
fiscal responsibility, and community resilience. And that is
at the end of my presentation, so I'm happy to take additional questions. Again, we have our capital
projects engineer here. If you have questions about capital projects, our assistant director of finance,
Matt Havy. Happy to take any questions. I have a question about the slide that showed your bill.
Three units of water, but two units of sewer.
Yeah, so. Summer that they don't get charged for wastewater for that. Question about the capital improvement
plan. At the current rate. Water main replacement
How long would it take to replace the entire system? Or do you need to take advantage of those terms?
That's a great question. I don't have a great answer for that. But I will say that our current water
main replacement rate is not as high as we'd like it to be due to a lack of funding. And so I think
it would take a very, very long time. Mark, you agree? A very long time.
There are pipe systems out there that are 80, 90 years old that we're working to replace. But there's
a certain limit on how much work you can actually do, right? So even with unlimited funding,
there's just the physical challenge of, I mean, to complain that you were digging up the entire city.
So the $19.8 million, if you
realistically factoring in the limitations on how much could feasibly be done, what would be your desired
amount of funding in a year to get us back on pace where we have some prospect of sort of getting on top of
We analyze, we take different criteria, analyze the materials of the pipes, the age of the pipes,
the frequency that the pipes in certain areas have had main breaks. And so we try and analyze.
It's not always just the latest or the oldest pipe that gets replaced. It's a pipe that we've analyzed
to figure out this is a likely
spot for a main break. Exactly what that amount is, you know, there are limitations, just a number of
employees and the amount of work that can get done in a year. Jennifer, you have it in front of you, yeah.
So in the revenue requirements of that $7.1 million that we're building into annual extensions
and replacements, in the later, in the beginning years, we are dividing some of those water main projects
up between bond financing and
revenue, but in the later years, we're trying to build it to about $5 million per year for water main
projects. So $5 million out of the $7.1 million of annual extensions or replacements. That's the target
we believe we need to accommodate a replacement that keeps us not going into infrastructure debt,
just right at that line. Where did we come up? How did we determine that now?
I came up with that number as we look at the total overall five year plan and what I try to do is pick
out the items that are very costly. There are over $7 million. I'm trying to get to an average of $7
million funding. It happens to work out that the water main projects ends up being the item that we're
trying to build to in the later years. We'll be funding a lot of the big projects at the water treatment
plant, the service center. Those million dollar projects will be funded through bonds
Cause we have to spend that down, but we're trying to build up the 7.1 million and the water main projects.
It happens to be the area that we're trying to build it up into as well. Yes. This is a five year plan
starting 2025 going to 2029.
but obviously the rates are not in place here in 2025. And so a lot of, yeah. So if the target's 5 million,
then we're however many million short per year, and we're continuing to be, to increase in working debt.
Correct. So in the first few couple of years, we've put about 3 million of that into the bond financing
to get you started. And then we're trying to, and do other big projects
But that is the part where we were trying to play between how much is funded ongoing through revenue
each year and how much is being funded through the bonds. So for the next great increase in four years,
it would be great to know exactly what we need, not exactly your best estimate of what we need to not
to not go any further.
Yes, absolutely. And I also think, you know, going back to what Mark said about how we
have been doing more and more analysis on the pipes so that we can have a more strategic approach to
how we're doing main replacement instead of just saying, hey, this is really old. Let's replace it.
Maybe this really old pipe has never had a main break. It was made out of an excellent material.
And it's been reliable. In a stable area. In a stable area. And so as we use
do this analysis we're actually creating you know a criticality scale and we're trying to knock those
ones that are at that top of that criticality scale we're trying to get those first and you know once
we actually are able to have more funds in our water main replacement we'll be able to see how much
we can do both in-house with our crews but also how much we will be able to contract out as well.
Glad we're thinking that way and planning that way. Thank you. Any other thoughts, questions? So within
the next two weeks, will we be receiving additional information about
the cost of services study, will we have access to these briefings? Okay. I got a question for Danica.
If you're still there, Danica. I sure am. Or your cohort. So if we can go back to the slide that had the
the rates by customer class. It's the one right after that percentage-wise revenue increase by customer class.
The first time we show the rates. Yeah, that's fine. So looking at this, like our wholesale cost to provide,
well, our rate for wholesale in Indiana University Master is really, really similar, right? Right about
$3 per 1,000 gallons.
So if that cost were correct, we would say that it costs about the same to provide a wholesale customer
a water as it does Indiana master meter. And the increases are ballpark pretty close, right? One's 50%
and the other's short of 60%.
So knowing that the plant's the plant and that the 36 inch mains coming in, that's all fixed.
Nothing differs there. Are the costs then attributable solely to the distribution system and pipes and
any pumps that provide those customers? Is that how we come up with the costs? I don't know much about how that
the service study is conducted. Sure, yes. You're talking about the differences in wholesale and IEU
as far as the cost goes, the cost allocation? Yeah, any customers. I mean, generally, but I'm interested
in those two because they're so close together, or were. They must have been, it was decided that they were
It was the same cost basically, the same amount of infrastructure in the ground to provide them that water.
And now it's just slightly different, but still very, very similar. Yeah, well, I think as Andy mentioned
earlier, this is a snapshot in time, right? And so when you see those rates similar, it's based on the
demand data that we discovered through the
AMI analysis and how those costs get distributed based on the way that they use the system. So at this
point in time, for this test year specifically, what we would say is that, you know, based on the findings
from the AMI that those two customer costs behave in a similar manner. You know, after that, too, Danica,
if it goes to the question, is that, you know, for the interconnection points in the nature of the distribution,
slash transmission system that's being used, you know, there is consideration and recognition that wholesale
customers have limited points of interconnection as does Indiana University Master Meter customers.
And they time more in at the transmission system because they have their own distribution networks, you know,
whether they're wholesale customers, you know, and or additional on, you know, on property distribution
systems like in the case of Indiana University. So those are the
The two big drivers are just the peaking characteristics that they each have as evidence in the ANI data,
then the nature of the types of costs that are included based upon their service characteristics,
how they tie into the system. Those are the two big drivers for the rates for Indian University and
wholesale as compared to the other customer classes. Yeah. Thank you. I got a lot to learn on this.
I'm looking forward to seeing the study. Thank you.
Questions or comments? I see one formulating. Yeah. Traditionally, this time of year, the water starts
tasting really bad and smelling really funky. How are things looking this year from a CPU's point of view?
How are things looking? We have had some elevated readings of Geosmin and MIB. Those are responsible
for taste and odor. We've switched over to our coconut-based carbon, and so we're hoping that we can
mitigate it with that. Also, the
Lower temperatures that we're seeing now and all the rain that we've gotten, I'm hoping will also help
to mitigate that because typically you see that after longer periods of drought and high temperatures.
So our shields have been engaged. Yes, our shields have been engaged. It seemed like about three weeks
ago we had a little bit of taste issue and then it was gone. Did anyone else experience this?
When did we implement the switch over to coconut? I believe that was today. Oh, OK. Yeah. Right, Hector? Yep.
Are there any questions on Zoom or anyone on Zoom? Okay. Okay, well, hearing none, everyone have a lovely
three day weekend. Thank you.