Title
An Ordinance to Amend Sections 2:61 through 2:64, and 2:69, and to Repeal Section 2:73 of Chapter 29 (Change Water, Sewer, and Stormwater Rates) of Title II of the Code of the City of Ann Arbor (Ordinance No. ORD-18-12)
Memorandum
Your approval is requested to amend Sections 2:61 through 2:64, and 2:69, and to repeal Section 2:73 of Chapter 29 of Title II of the Code of the City of Ann Arbor to adjust water, sewer, and stormwater rates and charges. The structural and price adjustments for water and sewer are a result of a comprehensive cost of service and rate design study for water and sewer (2017). The rate adjustments for stormwater are based on a level of service study conducted for stormwater (2016).
The last water and sewer cost of study was conducted in 2003, and rates and other charges have been indexed annually since then, but no cost of service adjustments have been made since the last study. In 2017, the City retained Stantec Consulting Services to provide their expertise in utility engineering and financial services. In compliance with the requirement that rates and charges be based on the costs to provide the services, the available data regarding those services and costs were collected and analyzed. The data included the patterns of water and sewer service usage by customers, including data regarding different types of use by different categories of customers, along with data regarding the costs to provide those services. The review and analysis of the data, and the principle that charges must be based on the cost to provide service, resulted in the proposed changes to Chapter 29 regarding charges to rate classifications, and changes to charges for water and sewer services. Based on the analysis, the rates and other charges were adjusted to align with the cost to serve each rate classification.
The study also included public feedback through focus groups and a public advisory committee, and a survey. The Environmental Commission also rec...
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