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Dfr. John Gcrhardson Page 35 <br /> T�ovc�rnbcr 10, 19'7? <br /> Pa�e T«o � <br /> � <br /> 2 . 'The systcm � s equitable. Orono ' s curi•ent 1-ate sti-l�cture <br /> is set up so tliat there is a mi�iir>>tim char�;e of � �7 .50 <br /> for uscrs that consume less than 10, 000 �allons per <br /> quarter of �vater . G�nerally, these users are elderly <br /> , people on fixed incor>>es . Rou�hly 9. 5jo of the current <br /> ctistomers consume less than 5, 000 �alloils per quai�ter, <br /> and another 13 . 8 0 of tl�e custor,��rs consw;�e b�t«�een <br /> 5, 000 and 10, 000 �allons per quari;er . U»der the proposed <br /> rate structure, those customers consuming below 8, 0000 <br /> ��allons will be charged `�7 . 20 per quarter u•hich results <br /> � in a unit cost of at least $0. 90/1000 gallons. Thus, <br /> r.�ost small users will have a s��all decrease in rates, <br /> }�et their unit cost for «:ater is {;reater th�n for <br /> users consurning over 8, 000 �allons. <br /> During inflationary periods, one ��rould eapect rates to <br /> increase to keep pace with increasin� operating costs . The <br /> proposal does not ii�l��act low volume users, of �r•hom many are <br /> e�pected to be on. fixed incomes . Simultaneously , Uy setting a <br /> r.�inir�um quarterly rate, the higher costs per connection associated <br /> . with low volur�e users can be recovered. <br /> In the case of larger users, the financial impact is <br /> demonstrated by the following comparison : <br /> Consumption Per Quarter Quarterly Charge Based on - <br /> ' (1000' s Gallons) Existing Rates $0. 90 1000 Gall�ns <br /> � 0 <br /> '' �15. 00 �18. 00 <br /> � 30 22 . 50 27 . 00 <br /> 50 34 . 50 45 . 00 <br /> � 100 59. 50 90. 00 <br /> 200 99. 50 180. 00 <br /> A typical three person household can expect to consume <br /> 20, 000 to 30, 000 gallons per quarter. Thus, their rates would <br /> increase by �3 . U0 to �4. 50 per quarter. <br /> � One of the foremost concerns regarding the lar�e volume <br /> users is that if the �roposal is adopted, these users will be <br /> more careful in their consumption habits and therefore revenues <br /> will decrease. Obviously there is a ecological concern that <br /> �vould sug�est that decreased consumption is good. To assess the <br /> loss of revenue impact , if all those users that consume over <br /> 50, 00� gallons per quarter were to effectively renuce consumption <br /> by 20`�, revenues �vould decrease by roughly �1700 to 52200 from 1978 <br /> to 1980. Total revenues �vould be adequate to meet operatins <br /> expenses because a minimum char�e is imposed on low volume users. <br /> � <br /> � - <br /> e <br />