Streamline - Winter 2017 - 33

Table 1: Overarching Results of RATES Programs

$109,067,878
$2,225,875
$6,123
1.75
$10,715
36,353%
5.0

Projected 5-year Revenue Increase, All Utilities Combined
Average Revenue Increase per Utility Analyzed
Average Fee per Utility Analyzed
Average Number of Utilities Analyzed for Each Client
Average Fee per Client (Mainly Cities) for All
Utilities Analyzed
Average Five-year Return on Rate Analysis Fee Investment
Average Days to Payback of the Analyst's Fees

of the revenue increase in five days. For
the next five years or so, minus five days,
the increased revenues are available to
pay for needed improvements and such.
All this averaging might make it seem
like fees are not nailed down. They are.
We scope each project and charge fees
on a lump-sum basis: $XX for a water
rate analysis, $YY for sewer and $ZZ
for an on-site visit. Going in, clients
know exactly what their project will
cost. The uncommon situation where
we charge by the hour is when attorneys
are involved (lawsuits).
The five-year average return on investment rate is 36,353 percent. That's right,
not single or double digits of percent,
but thousands of percent. Beat that,
Wall Street!
Table 2, shows electric utilities saw the
greatest average rate revenue increases.

Electric is often considered the "cash
cow" of utilities, but those rates still
needed to go up.
You might be gratified to know that
water rates needed to go up the least.
On average, the water utilities were only
$334,000 per year short of the revenues
they should have been collecting. But, a
third of one-million-dollars per year is
a lot to be short.
In Table 3, you can see we analyzed 49
utilities but only had 29 clients - many
cities and a few districts have us analyze
multiple utilities. And, we didn't have
29 different clients. Eight of our clients
so far have been repeats. They had us
analyze something. After that experience, they came back and had us analyze
again. Sometimes that was to update a
previous analysis. Sometimes it was to
analyze a different utility.

Table 2: Returns by Utility Type

Utility Type
Water
Sewer
Electric
Trash

Number
24
19
3
3

Revenue Increase
Total
Average
$40,059,063
$1,669,128
$49,447,795
$2,602,516
$13,307,281
$4,435,760
$6,253,739
$2,084,580

Table 3: Basic RATES Program Client Data

2,839
49
29
8
6
4

©WHO IS DANNY/SHUTTERSTOCK.COM

Average Connections or Customers of Each Client
Utilities Analyzed
Clients (Cities, Districts)
Repeat Clients
Analyses Where a Return on Investment (lawsuits, rate
disputes, etc.) Calculation is Not Relevant
Analyses Underway Now

There are two big picture results
we crow about. The hidden one is the
improvement in rate structure fairness
that rate analysis enabled these utilities
to achieve. You can't show rate structure fairness in a return on investment
calculation. However, it yields an important, if unmeasurable, return - goodwill. Every public servant and utility
needs goodwill.
The in-your-face satisfying result is
the increase in revenues - $109 million. That will buy these systems a lot
of improvements, equipment repair and
replacement, you name it. That enables
a lot of good service. Good service buys
goodwill. We're double-dipping on the
goodwill return.
There are many articles in this magazine edition, and all the editions that
came before it, about a problem and its
fix. At the heart of almost every utility
problem is (the lack of) money. Money
www.vrwa.org

33


http://www.vrwa.org

Table of Contents for the Digital Edition of Streamline - Winter 2017

From the President: Ammonia-Nitrogen
From the Executive Director: Your Most Important Tool
VRWA’s 2017 Expo
How to Pass a Certification Test – The First Time
Slips, Trips and Falls – Winter Safety Tips
Looking Forward to Being of Service
Floodplain Management
No Wipes in the Pipes
Going Green?
Need Cash? Check the Meter!
The Rate Setting Results…Are In
Introducing JumpStart – A New App for Operators to Test Their Skills Before Testing!
Throwing My Loop: Christmas Lights on the Barn!
VRWA Member Corner
eLearning Benefits
Membership Application
Benefits for VRWA Members
Board of Directors
VRWA Committees
Index to Advertisers/Ad.com
Streamline - Winter 2017 - Intro
Streamline - Winter 2017 - cover1
Streamline - Winter 2017 - cover2
Streamline - Winter 2017 - 3
Streamline - Winter 2017 - 4
Streamline - Winter 2017 - 5
Streamline - Winter 2017 - 6
Streamline - Winter 2017 - 7
Streamline - Winter 2017 - 8
Streamline - Winter 2017 - From the President: Ammonia-Nitrogen
Streamline - Winter 2017 - 10
Streamline - Winter 2017 - From the Executive Director: Your Most Important Tool
Streamline - Winter 2017 - VRWA’s 2017 Expo
Streamline - Winter 2017 - 13
Streamline - Winter 2017 - 14
Streamline - Winter 2017 - 15
Streamline - Winter 2017 - 16
Streamline - Winter 2017 - 17
Streamline - Winter 2017 - How to Pass a Certification Test – The First Time
Streamline - Winter 2017 - 19
Streamline - Winter 2017 - Slips, Trips and Falls – Winter Safety Tips
Streamline - Winter 2017 - Looking Forward to Being of Service
Streamline - Winter 2017 - 22
Streamline - Winter 2017 - Floodplain Management
Streamline - Winter 2017 - 24
Streamline - Winter 2017 - No Wipes in the Pipes
Streamline - Winter 2017 - 26
Streamline - Winter 2017 - Going Green?
Streamline - Winter 2017 - Need Cash? Check the Meter!
Streamline - Winter 2017 - 29
Streamline - Winter 2017 - 30
Streamline - Winter 2017 - 31
Streamline - Winter 2017 - The Rate Setting Results…Are In
Streamline - Winter 2017 - 33
Streamline - Winter 2017 - 34
Streamline - Winter 2017 - Introducing JumpStart – A New App for Operators to Test Their Skills Before Testing!
Streamline - Winter 2017 - 36
Streamline - Winter 2017 - Throwing My Loop: Christmas Lights on the Barn!
Streamline - Winter 2017 - 38
Streamline - Winter 2017 - VRWA Member Corner
Streamline - Winter 2017 - 40
Streamline - Winter 2017 - eLearning Benefits
Streamline - Winter 2017 - Membership Application
Streamline - Winter 2017 - Benefits for VRWA Members
Streamline - Winter 2017 - 44
Streamline - Winter 2017 - VRWA Committees
Streamline - Winter 2017 - Index to Advertisers/Ad.com
Streamline - Winter 2017 - cover3
Streamline - Winter 2017 - cover4
http://www.nxtbook.com/naylor/VRWQ/VRWQ0119
http://www.nxtbook.com/naylor/VRWQ/VRWQ0418
http://www.nxtbook.com/naylor/VRWQ/VRWQ0318
http://www.nxtbook.com/naylor/VRWQ/VRWQ0218
http://www.nxtbook.com/naylor/VRWQ/VRWQ0118
http://www.nxtbook.com/naylor/VRWQ/VRWQ0417
http://www.nxtbook.com/naylor/VRWQ/VRWQ0317
http://www.nxtbook.com/naylor/VRWQ/VRWQ0217
http://www.nxtbook.com/naylor/VRWQ/VRWQ0117
http://www.nxtbook.com/naylor/VRWQ/VRWQ0416
http://www.nxtbook.com/naylor/VRWQ/VRWQ0316
http://www.nxtbook.com/naylor/VRWQ/VRWQ0216
http://www.nxtbook.com/naylor/VRWQ/VRWQ0116
http://www.nxtbook.com/naylor/VRWQ/VRWQ0415
http://www.nxtbook.com/naylor/VRWQ/VRWQ0315
http://www.nxtbook.com/naylor/VRWQ/VRWQ0215
http://www.nxtbook.com/naylor/VRWQ/VRWQ0115
http://www.nxtbook.com/naylor/VRWQ/VRWQ0414
http://www.nxtbook.com/naylor/VRWQ/VRWQ0314
http://www.nxtbook.com/naylor/VRWQ/VRWQ0214
http://www.nxtbook.com/naylor/VRWQ/VRWQ0114
http://www.nxtbook.com/naylor/VRWQ/VRWQ0413
http://www.nxtbook.com/naylor/VRWQ/VRWQ0313
http://www.nxtbook.com/naylor/VRWQ/VRWQ0213
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0113
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0412
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0312
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0212
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0112
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0411
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0311
http://www.nxtbook.com/nxtbooks/naylor/VRWQ0211
http://www.nxtbookMEDIA.com