1. 2010 Great Lakes Water Rate Survey MICHIGAN STATE UNIVERSITY Janice Beecher and Jason Kalmbach I NSTITUTE OF P UBLIC U TILITIES  MICHIGAN STATE UNIVERSITY beecher@msu.edu  ipu.msu.edu Please do not distribute by electronic or other means or cite without permission.

2. Beecher - 2 2011 2010 Great Lakes Water Rate Survey  Top ten water systems by service population from eight Midwestern states, by service population size as reported in EPA Consumer Confidence Reports  Illinois, Indiana, Michigan*, Minnesota*, New York, Ohio, Pennsylvania, and Wisconsin (*no economic regulatory authority)  Data gathered from websites & personal communications.  Nine water providers no rate information available directly on the website

3. Beecher - 3 2011 Watershed map and systems in the sample – not final

4. Beecher - 4 2011 Service population

5. Beecher - 5 2011 System service populations

6. Beecher - 6 2011 Sample characteristics

7. Beecher - 7 2011 Effective date of tariff

8. Beecher - 8 2011 Billing cycles

9. Beecher - 9 2011 Billing combinations

10. Beecher - 10 2011 Tariff charges

11. Beecher - 11 2011 Rate structures

12. Beecher - 12 2011 Peaking-factor rate (Ann Arbor, MI)

13. Beecher - 13 2011 Rate structures by ownership

14. Beecher - 14 2011 Public fire-protection in fixed charges: average by meter size

15. Beecher - 15 2011 Public fire-protection in fixed charges: range by meter size

16. Beecher - 16 2011 Fixed charges and variable unit rates for 100 ccf by usage level

17. Beecher - 17 2011 Conservation and assistance policies

18. Beecher - 18 2011 Average charges by state

19. Beecher - 19 2011 Average charges by system characteristics

20. Beecher - 20 2011 Average charges for 0 cf (0 gal.)

21. Beecher - 21 2011 Average charges for 1,000 cf (7,480 gal.)

22. Beecher - 22 2011 Average charges for 50,000 cf (374,000 gal.)

23. Beecher - 23 2011 Average charges for 1 mil. cf (7.4 mil. gal).

24. Beecher - 24 2011 Monthly bills by system size and ownership

25. Beecher - 25 2011 Comparison to AWWA rate survey (2008)

26. Beecher - 26 2011 Water utility cost-trend analysis  Data from the Wisconsin Public Service Commission  Period: 2000-2009  Benchmarking analysis  Annual financial reports  Class AB water utilities  N ranges from 72 to 94  Informative but not generalizable to other water systems

27. Beecher - 27 2011 Utility plant to revenue ratios (capital intensity)

28. Beecher - 28 2011 Utility plant investment by function

29. Beecher - 29 2011 Ratio of value of plant additions to retirements

30. Beecher - 30 2011 Operating revenues and expenses per water sold

31. Beecher - 31 2011 Operating expenses per water sold

32. Beecher - 32 2011 Operating expenses by water source

33. Beecher - 33 2011 Pumping statistics

34. Beecher - 34 2011 Revenue trends by customer class

35. Beecher - 35 2011 Trends in residential water sales and revenues

36. Beecher - 36 2011 Note: rate disparity between private and public systems (Beecher)  Income, property, and other taxes and fees (e.g., franchise)  Profits (equity returns to “owners” are less for public)  Financing (including SRF for cities)  Scale and density economies (favor cities)  Locational cost differentials (varies)  Contributions and system development fees (cities)  Costing practices (depreciation v. replacement expense)  Hidden subsidies (but also transfers)  Rate practices (outside-city rates)  Cost avoidance and deferrals (sometimes)  Investment incentives (private)  Economic regulation (cost-based rates) Note: significant variations from system to system Some municipal utilities actually provide transfers