United States
             Environmental Protection
             Agency
             Office Of Water
             (WH-547)
EPA 832-B-92-003
August 1992
4>EPA
Determining Wastewater
User Service Charge Rates

A Step By Step Manual
                                        Printed on Recycled Paper

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                                                                               1
                                        INTRODUCTION
Good financial management is a critical part of all wastewater opera-
tions. It allows you to establish the user  service charge rates neces-
sary to keep  your utility financially healthy and running smoothly.
This publication was designed to help small to  medium-sized waste-
water utility  operations decide how much they should be charging
their residential, commercial,  and industrial customers  for wastewater
services. It includes a Lotus 1-2-3 computer model program and
manual procedures to help you calculate specific values for your
system's user service charges.

Using a model  computer program to help calculate your user service
charge rates has many advantages. As you  know, setting rates can  be
a difficult and time-consuming  task, involving  lots of paper, pages  of
statistics, and hours of work. Computers simplify these tasks. This
computer program quickly and  accurately calculates user service
charge rates using specific information from your wastewater opera-
tions. In addition, once you have collected the basic information, this
computer program makes it easy for you to see  the effects of a
change in  different operating  variables. Unfortunately,  the program
cannot make  the difficult decision of when  to increase user service
charges. However, it will quickly give you information to support
those decisions.

The computer program is  designed to be  as  easy  to use as possible.
The only requirements are that you have an IBM-PC or PS/2 compat-
ible computer and Lotus 1-2-3, version 2.01, 2.2, or higher. The  pro-
gram  only requires that you have general familiarity with your com-
puter and know how  to start Lotus  1-2-3. The instructions in this
manual and  on the computer  screen will lead you  through the  pro-
gram.
                     INFORMATION You  NEED
The computer program supplied with this manual will ask you for
information about your wastewater system, its costs, treatment waste-
load, and other information.  To save  time, have the  following infor-
mation at hand before starting the computer  program:

•  financial  statements. The  latest annual financial statements for your
   wastewater  operations. If  you combine the finances  for water and

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wastewater operations,  you'll need to break the records down into
separate water and wastewater accounts.

current user  service charge rate schedule. This is the existing rate
schedule used to bill your customers. If your billing system
doesn't use metered fresh water to bill for wastewater service, the
program will  need information on the number and type of
customers.

total wastewater flow.  The total annual flow  in gallons (not  mil-
lions of gallons) treated by your  treatment plant over the same 12-
month period covered by the  financial statements. (Multiply cubic
feet by 7.5 to get gallons of flow.)

total metered water flow (if applicable). The  total annual metered
drinking water in gallons (not millions  of gallons)  provided to
your wastewater customers over the same 12-month period covered
by the  financial statements. The annual metered water flow should
be sub-grouped  by user type:  residential,  commercial/institutional,
and industrial.

total industrial  wastewater flow.  The program will require the
total industrial wastewater flow through the  treatment plant,  for
both metered  and unmetered systems. If this  figure is not  avail-
able, you will have to  estimate the flow.

total annual  influent BOD  and SS. The pounds (not  millions of
pounds) of biochemical oxygen demand (BOD) and suspended
solids  (SS) treated  by  your plant  over the same 12-month period
covered  by the  financial statements.

the number of customers by type (for unmetered water only).
Type means residential  single-family, one- and two-bedroom apart-
ments,  three-or-more bedroom apartments, commercial (such as
stores, restaurants, office buildings) and institutional  (such  as
churches, hospitals, government buildings), and industries.  Nor-
mally, industrial wastewater is metered and analyzed  by the
wastewater utility to accurately assess each industrial  user's service
charges.

an IBM-compatible computer  with Lotus  1-2-3, version 2.01, 2.2,
or higher. An IBM PC,  PC-XT, or PS/2, or compatible with Lotus
1-2-3, version 2.01, 2.2  or higher  and enough memory to run  Lotus
1-2-3. The Lotus 1-2-3  program included with  this manual is  avail-
able in 3.5"-730Kb  format, or 5.25"-360Kb  format. A fixed disk
(hard disk) drive  isn't  required, but the files  necessary to  run the
program may be copied to  a fixed disk drive.

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                                         ASSUMPTIONS
The computer program is designed using the  following assumptions:

•  wastewater flow. The program uses  an equivalent dwelling unit
   (EDU) methodology for unmetered fresh water systems. An equiva-
   lent dwelling unit (1.0 EDU) is a single-family detached residence.
   The program assumes a one- or two-bedroom apartment equals
   0.75 EDU, a three-bedroom apartment  or larger equals 1.0 EDU, a
   commercial/institutional user equals  2.5 EDUs, restaurants and
   taverns equal 10.0 EDUs, and industrial users are charged based
   on actual  wastewater  flows. Extraneous wastewater flows  (i.e.,
   infiltration and inflow) are distributed to users in the same manner
   as normal wastewater flows.

•  financial management. The wastewater operations are  assumed to
   be financially self-sufficient municipal  utility  operations.

•  uniform rates. All users are  billed on a uniform  rate to assure  fair
   and equitable distribution of the wastewater  operational costs to
   each user. (For example, all users  pay their proportionate share of
   the wastewater operational costs.) The uniform rate calculated by
   the program is based  on total volume (gallons) of wastewater and
   the normal BOD and  SS content for  residential wastewater.  The
   cost of treating high strength BOD and SS wastewater is  included
   as a surcharge in the uniform industrial rate.

   A  surcharge occurs only when the program determines that the
   BOD or SS concentration of the wastewater treated by your plant
   exceeds  that normally expected from domestic sewage. (Normal
   domestic strength wastewater  is assumed to contain .002294 pounds
   of BOD and SS per gallon, or 2,294  pounds per 1 million  gallons
   of wastewater.) The program then  assumes that industry is the
   source of  the excess treatment load and develops an industrial
   surcharge  rate.

   Some wastewater utilities use the declining  block rate structure,
   where higher volume  users pay a lower rate per  1,000 gallons of
   wastewater treated. This approach  isn't used  by this program be-
   cause it doesn't  equitably  charge users  for the cost of wastewater
   services.

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STARTING THE  PROGRAM
Before using the computer program, you're  encouraged to first read
through  this manual  and  assemble the required information.

COPY THE DISK

   Make a back-up copy  of the program disk, use the back-up copy,
   and put the original disk in a safe place. If you have a hard disk,
   you can copy either the  version 2.01 files (RATE201.WK1 and
   NEWRATES.PRN) or the version 2.2 (or  higher) files (RATE.WK1
   and NEWRATES.PRN) from the floppy disk that came with the
   manual onto your hard disk drive. Be sure to copy both files;
   both  are necessary.

LOAD LOTUS 1-2-3

   Load  Lotus 1-2-3  on your computer in  the normal manner.

LOAD RATE.WK1

   Make sure that Lotus 1-2-3 knows where to look for the
   RATE.WK1 files by setting the directory  with the SLASH KEY (/)
   File-Directory sequence, and then typing the appropriate directory
   (A: or C:\LOTUS if your files are on a  fixed disk, etc.). Follow
   the usual Lotus file retrieve sequence by  pressing  SLASH KEY File-
   Retrieve, and load RATE.WK1.

   When RATE.WK1 loads,  it begins an automatic program that will
   lead you through  the entire process. Read the screens carefully;
   follow the  instructions shown on each  screen and observe the rules
   that follow.
GENERAL  INSTRUCTIONS
To enter the information for a specific question, type the appropriate
response and press  ENTER.  While you're typing, the information being
typed will appear at the top of the screen.  You may correct errors in
a line you are entering by using BACKSPACE  and the left and right
ARROW keys, and re-typing. After you press ENTER  (RETURN key), the
information will  appear in the proper location on  the screen. In some
parts of the program where the data is necessary  to calculate new

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rates, you'll have a second chance to edit  your entries on the entire
screen before  going on to the next screen.

When entering numbers into  the program,  don't  use commas or cur-
rency signs. The program will insert commas and currency signs
where necessary. If you wish to enter a decimal, such as  dollars and
cents, you must  type the decimal  point. For example, $3 would be
entered simply as 3 (no currency sign), while $2.75  would be entered
as 2.75  (decimal  point, but still no currency sign). Three million
(3,000,000) would be entered  as 3000000 (no commas).

If you follow  the directions, you  shouldn't  have  any difficulty. How-
ever,  if you become completely lost  or  enter the wrong information,
the program can be stopped by holding down the CTRL (Control) key
and pressing the BREAK key once.  After pressing  this key  sequence, an
error message  will  flash on the screen;  just press ENTER once, and
then re-load the  program from the disk to  re-start.  This is usually  not
necessary;  even if the information  entered  is incorrect, the program
will still run through to  completion.

Occasionally, you'll type  something or do something the program
doesn't  expect  or won't accept. An electronic beep will  sound. This is
neither  disastrous nor unusual, even for experienced Lotus 1-2-3  users.
There is always a reason; study the screen  and follow the directions
carefully, and the beeps will  be minimized.

After  running the program, the results  of your work — the informa-
tion you enter and  the recommended new  rates — will be saved to a
text file named NEWRATES.PRN.  This  file should never  be  erased! If
you want to  see the results of a program  run, print the file  using  a
word  processor or  copy it to  another directory. You  can print or copy
the file, but don't erase or delete  the original file.

It's not necessary or recommended that you save the RATE.WK1 file
after running  the program. However, if you are  proficient with Lotus
1-2-3, you  can  save the file under a different name.  To save  the
spreadsheet file,  rename it  so  that the original RATE.WK1 file
remains  intact.

If you are an  EPA wastewater construction grantee,  you may wish  to
calculate only the user charge (operations,  maintenance, and equip-
ment  replacement)  rates.  To accomplish this, simply  enter  a 0 for
principal and  interest payments on the  WASTEWATER COLLECTION
AND  TREATMENT EXPENSES screen, and  exclude all revenues
collected for debt service.

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                 INTRODUCTORY SCREENS
                 After starting RATE.WK1, an introductory  screen appears,  as shown
                 in Figure 1.
                                              Welcome to

                                             DETERMINING
                                    WASTEWATER USER SERVICE CHARGE RATES

                                            developed lor the
                                       U. S. Environmental Protection Agency
                                               by the
                                       Municipal Technical Advisory Service
                                           University of Ten
                                                1991
                                      (Please press the ENTER key to continue.)
Figure 1:
Introductory
Screen
                 Pressing ENTER  takes you to a second screen that asks for the name
                 of your jurisdiction (city, county, district, etc.), which may be up to
                 72 characters long.  Please don't  try to bypass this screen: the pro-
                 gram uses  your jurisdiction name to track some of its actions.  You
                 must type  an entry and press ENTER before  the program will proceed.

                 The  next two screens give  basic instructions on what information the
                 program will need, as shown in Figures 2 and 3 on the next page.
                 Read the first screen, press ENTER, then read the  second screen and
                 press ENTER again. You will be presented with three choices  at the
                 top of the  screen: CONTINUE, QUIT, or READ THE INSTRUCTIONS
                 AGAIN. You can move the highlighted cursor  from choice to choice
                 with the SPACE  BAR or the  right  and left ARROW keys. The second line
                 of the screen will show explanatory text for each choice as  you move
                 from one choice to the next. Make  a  choice by highlighting the text
                 with the cursor and pressing ENTER.

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                         Anytown, USA
              Determining User Service Charge Rates

     This Lotus 1-2-3 program will help you to determine your user
service charges tor wastewater treatment. You should read through the
manual which accompanies this program before proceeding. If you
havent read the manual, you should choose "QUIT" after reading this
screen and the next screen.

     To use the Wastewater User Service Charge Rates Program, you
should have the following Information at hand:
(1)   The latest financial statements and/or budgets for your wastewater
     operation, Including all revenues and expenses;
(2)   If you meter water consumption, you need the current billing
     schedule (rates per 1,000 gallons of wastewater treated);

              Please press ENTER for more Instructions
                                                                                                   Figure 2:
                                                                                                         First
                                                                                                 Instruction
                                                                                                     Screen
(3)   If you do NOT meter or estimate water consumption, you need the
     number of wastewatar customers In each of the following classes:
     (a)  Single-family residences;
     (b)  Apartments with 1-2 bedrooms, and with 3 or more bedrooms;
     (c)  Commercial and Institutional users other than restaurants;
     (d)  Restaurants; and
     (e)  Industries.
(4)   The actual total annual wastewater flow of your plant and the total
     flow of all Industrial users (In gallons).
(5)   If you meter water use, total annual metered water flow broken
     down by type of user (residential, commercial, and Industrial).
(6)   The biochemical oxygen demand (BOD) and suspended solids (SS)
     (both In pounds) content of the wastewater which comes Into the
     plant (Influent) each year.

If you have this Information at hand, press ENTER and select CONTINUE;
otherwise press ENTER and select QUIT, and return to this program
later.
        Please press ENTER when you have read this screen.
                                                                                                   Figure 3:
                                                                                                     Second
                                                                                                 Instruction
                                                                                                      Screen

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  8
               METERED/UNMETERED  SCREEN
               This screen (Figure 4) asks you to identify how you determine users'
               wastewater flow (METERED or UNMETERED). Your choice here will
               determine the direction the program follows from this point on. Use
               the SPACE BAR or ARROW keys  to make a choice, and press ENTER.
                          METERED/UNMETERED
                             Is your fresh water supply METERED or UNMETERED?
                                  (Press the right or ton ARROW key
                                to select "METERED" or "UNMETERED")
Figure 4:
Metered/
Unmetered
Screen

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      CURRENT WASTEWATER  BILLING
          SCHEDULES (METERED ONLY)
This screen, shown in Figure 5 with example data, asks you to  enter
your current billing schedule (per 1,000 gallons of use) for wastewater
user service charges.  This information is used  for comparison pur-
poses at the end of the program, where new wastewater bills are
compared to the average bills under the existing rates for billing
classes you enter on  this screen. It begins by asking for the first step,
beginning with zero usage.
             Anytown,USA
             METERED water
                      r Service Charge Rates
                   Currant Wastewater Services Billing Schedule
                           Monthly Rates
                         11111111111 n n 1111111 i-t + t M
               Total Gallons Treated
              From...      To...
                0
              2,001
              4,001
              6,001
             10,001
2,000
4,000
6,000
10,000
 Rate per
1,000 gallons

 $2.00
  1.90
  1.80
  1.50
  1.40
                                                                      Figure 5:
                                                                 Metered Water
                                                                Billing Schedule
                                                                  (with example
                                                                         data)
Type the first usage figure, with no commas (for example, 2000), and
press ENTER. Then enter the rate per 1,000 gallons  for this class  (no
currency signs or commas; only decimal points if necessary). When
you press ENTER, the program starts the next step  by  taking  the pre-
vious figure and adding 1 to  it. Continue entering steps as before.
You may enter up to 10 rate steps, but no more.  You must enter at

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 10
least two rate steps for the program to proceed. When you enter
your last step (for example, 10,000 gallons  and  above), leave the To
step blank and press ENTER. In version 2.01, type a 0 and press EN-
TER. Then enter the rate for that step. The program then displays the
EDIT MENU (see page 11). If your  rate structure uses uniform rates
(the same rate per 1,000 gallons for all  levels of usage), just enter
two rate steps at that rate.
Figure 6:
Instructions for
Unmetered
Users
                ENTERING  CUSTOMERS BY  TYPE
                (UNMETERED ONLY)
                If you choose UNMETERED water on the METERED/UNMETERED
                screen,  a  message (see Figure 6) says you will be asked to provide
                information about the number of customers by type of users. This
                information is essential to  arriving at recommended rates for a flat
                rate wastewater user service  charge system.
                                ENTERING THE NUMBER OF CUSTOMERS BY TYPE OF USER

                                On the next screen, you will be asked to enter the number of
                             customers by type of user (residential, apartments, commercial, etc.).
                             This Information Is necessary to evaluate the the amount of waste
                             being treated by your plant and determine If a surcharge for Industrial
                             users Is necessary.
                                  Please press ENTER when you are ready to proceed.

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Pressing ENTER takes you to a screen, shown in Figure 7 with ex-
ample data. You should enter the number of customers  by class (no
commas  in the number).  If you  don't have any customers in a par-
ticular class, enter a zero. After entering the last figure, the EDIT
MENU will appear.
11
                Anytown, USA
                Determining UMT Service Charge Rates
                Number of User* by Type - UNMETERED WATER
                                               NUMBER of
                      TYPE OF CUSTOMER            CUSTOMERS

                Single Family Residences                 8,000
                Apartments (1-2 bedroom)                 1,500
                Apartments (3 or more bedrooms)             1,000
                Commercial/Institutional                   900
                Restaurants and Taverns                   100
                Industrial                            100
                                                                                Figure 7:
                                                                                Entering
                                                                             Numbers of
                                                                              Unmetered
                                                                           Users by Type
                                                                           (with example
                                                                                   data)
                                                EDIT  MENU
The  EDIT MENU is a feature that  will appear on a number of screens
after  you enter the last data item on  the screen. It allows you to
make changes  to any  of the  data you have just  entered before leaving
the screen.  Highlighting  YES and pressing ENTER displays a  message
explaining that an entry can be changed  by highlighting it  with the
cursor (use the up, down, left, and right ARROW  keys), typing the
new data,  and pressing ENTER.  Only the  data you entered on this
screen should  be changed. Changing  any other  information on the
screen could have unpredictable and  possibly unpleasant results!

If you change  an item on  the screen and  press  ENTER,  you  will  be
asked if there  are  any other changes to be made. A NO selection lets
you  move  to the  next screen by  pressing ENTER.

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  12
                   WASTEWATER  OPERATIONAL
                   EXPENSES
                  The next screen (see  Figure 8)  is an  introduction to entering your
                  wastewater collection and  treatment expenses.  This portion of the
                  program will require the use of your financial statement(s).
                                    ENTERING YOUR WASTEWATER OPERATIONAL COSTS

                                  On tha next screen, you will be asked to enter your system's total
                               cost of operations. The figures you will be asked to enter Include the
                               typical Items tor your wastewater collection AND treatment operations:
                                  Salaries and benefits
                                  Utilities
                                  Equipment replacement fund (reserve for replacement) contributions
                                  Chemicals, supplies and parts
                                  Contract services
                                  Administrative costs and office supplies
                                  Principal and Interest payments
                                  Any other costs
                                  As you enter these figures, help will be available to explain what
                               each category Includes. Help Is also In the manual. Please Include ALL
                               costs; the help screens are Just "reminders," not comprehensive lists.
                                     Please press ENTER when you are ready to proceed.
Figure 8:
Instructions
for Entering
Operational
Costs

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After reading the introductory screen, press ENTER and the data entry
screen will appear (see Figure 9). You  will be  prompted for the fiscal
year covered  by the figures you  are  about to enter. Just type the year
(for  example, 1990).  Don't type FY; the program will  add that prefix.
If  the  figures are for a 12-month period other  than  a fiscal year, you
may edit the FY prefix after completing  data entry  on this  screen by
using  the  EDIT MENU that  appears following the last entry.
13
               What fiscal year are thaaa figures for?
                     Anytown, USA
                     Wastewater Collection and Treatment Expenses
                     Salaries and Fringe Benefits
                     Utilities
                     Equipment Replacement Fund
                     Chemicals;, Supplies and Parts
                     Contract Service*
                     Administrative Costs & Office Supplies
                     Principal and Interest Payments
                     Other Costs
                                                                                  Figure 9:
                                                                                  Entering
                                                                             Collection and
                                                                           Treatment Costs
                                                                                (fiscal year)
This screen is different from the other screens of the program in that
it  offers help in classifying  your expenditures. After entering  the fiscal
year and pressing ENTER, a menu choice  for SALARIES AND PRINCES
appears  (see Figure  10). Moving the  highlighted  cursor to HELP! and
pressing ENTER  takes you to a screen of  explanatory information on
SALARIES AND FRINGES  (see Figure 11). After reading the screen,
return to the EXPENSES screen  by pressing ENTER. You then must
highlight the expense item title  and press ENTER  again before typing
an amount. Continue in the same way through all of the items  on the
screen.  After  you have entered all  the  figures, the program will com-
pute the total (see Figure  12 on page 15), and the  EDIT MENU will
appear  after you enter the last item. Remember,  no commas and no
currency signs.

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   14
                                                Salaries and Fringes  HELP!
                                                Ready to enter salaries and fringes expenses (press ENTER)
                                                         Anytown, USA
                                                         Wastewater Collection and Treatment Expenses
                                                         FY1990
                                                         Salaries and Fringe Benefits
                                                         unities
                                                         Equipment Replacement Fund
                                                         Chemicals, Supplies and Parts
                                                         Contract Services
                                                         Administrative Costs & Office Supplies
                                                         Principal and Interest Payments
                                                         Other Costs
Figure 10:
Entering Salaries
and Fringes
                                                                SALARIES AND FRINGES: HELP

                                                     Salaries and fringe benefits Includes ALL of the following Items
                                                for all employees of the wastewater collection and treatment
                                                operation, Including office and administration employees:
                                                Salaries
                                                Wages
                                                Temporary Salaries
                                                Overtime Pay
                                                Sick Pay
                                                Holiday Pay
                                                Longevity Pay
                                                Bonuses
Social Security
Health and Hospltallzatlon Insurance
Retirement Contributions
Workers' Compensation
Unemployment Compensation
Employee Training
Life Insurance Costs
Other Employer Contributions
                                                        Please press ENTER when you are ready to proceed
Figure 11:
Salaries and
Fringes

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                     Anytown, USA
                     Wastawatar Collection and Treatment Expenses
                     FY1990
                     Salaries and Fringe Benefit*                $1,367,000
                     Utilities                             127,000
                     Equipment Replacement Fund                330,000
                     Chemicals, Supplies and Parts                 45,000
                     Contract Service*                        67,000
                     Administrative Costs & Office Supplies          138,000
                     Principal and Interest Payments               195,000
                     Other Costs                            56,000

                                        TOTAL EXPENSES:  $2,325,000
                                                                                       15
                                                                                      Figure 12:
                                                                                    Wastewater
                                                                                  Collection and
                                                                                      Treatment
                                                                                      Expenses
                                                                                  (with example
                                                                                           data)
Following is the text of the  EXPENSES  HELP screens for easy refer-
ence:

SALARIES  AND FRINGES: HELP

   Salaries and fringe benefits includes  all of the  following items for
   all employees of the wastewater collection and treatment  operation,
   including office  and administration employees:

   •   salaries,
   •   wages,
   •   temporary salaries,
   •   overtime  pay,
   •   sick pay,
   •   holiday pay,
   •   longevity pay,
   •   bonuses,
   •   Social Security,
   •   health and hospitalization  insurance,
   •   retirement contributions,
   •   workers'  compensation,
   •   employee training,
   •   life insurance costs, and
   •   other  employer contributions.

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16
UTILITIES: HELP

   Utilities includes any expenditure for natural gas, electric  power,
   telephones, and  water service for the treatment  plant and  the col-
   lection system.  Be sure to include the power costs for  operation of
   collection  system pumps and  lift  stations, as well as any charges
   for  telephone lines required to monitor and control  the collection
   system. Utilities may also  include the cost of refuse collection for
   the  treatment plant.

EQUIPMENT  REPLACEMENT: HELP

   Each wastewater operation should have some method  of setting
   aside  funds for  the  replacement  of major equipment items. One  of
   the  most frequently used techniques  is  an equipment replacement
   fund or reserve for equipment  replacement.  This should include  any
   funds your wastewater operation  sets aside to pay for  future repair
   and/or replacement of  items  such as lift  pumps, vehicles,  and
   other  major pieces of equipment used  to  collect and treat  waste-
   water.

CHEMICALS,  SUPPLIES, AND PARTS:  HELP

   This category includes all  of  the  following typical items, and any
   similar  items:

   •  treatment chemicals,
   •  laboratory supplies,
   •  gas, oil, diesel fuel, grease, etc.,
   •  machinery and equipment  parts,
   •  automotive parts,
   •  electrical, painting, plumbing,  and carpentry  supplies,
   •  repair  parts for collection  lines,
   •  consumable  tools,
   •  concrete, metal, and plastic pipe  and culverts used  for  repairs,
   •  cement, crushed  stone,  gravel, sand, and dirt,
   •  building materials,
   •  asphalt, and
   •  other repair  and maintenance  supplies.

CONTRACT SERVICES: HELP

   This category  includes  any services purchased from providers who
   are not part of  the  wastewater  operation. Typical items include:

   •  freight, express,  and truck charges,
   •  contract printing and duplication  services,
   •  legal services,
   •  data processing services,
   •  architectural  and engineering services,

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   •  plant  and collection system repair and maintenance services,               Hj "*7
   •  automotive repair and maintenance services, and                           •  •
   •  leased equipment  costs.

ADMINISTRATIVE COSTS AND  OFFICE SUPPLIES:  HELP

   Administrative costs includes any expenditures that could be  con-
   sidered indirect, overhead, and/or not directly attributable to the
   actual collection and  treatment of wastewater. Included in this
   category  would be any costs  of utility billing and  revenue collec-
   tion, management  of  the  wastewater system, and office supplies.
   Typical items  of expenditure  would include:

   •  postage,
   •  travel costs,
   •  data  processing costs,
   •  printing, publications,  subscriptions, and professional  dues,
   •  office and  utility billing supplies,
   •  wastewater share of water meter-reading costs,
   •  delinquent  accounts collection costs,
   •  liability and structural insurance, and
   •  rents  and leases.

PRINCIPAL  AND INTEREST: HELP

   This category  includes  the annual debt service cost associated with
   borrowing and repaying money for the wastewater system. The
   annual payments on bonds, notes, revenue anticipation notes, state
   and/or federal loans, mortgages, and any other short or long-term
   debt should be included.  In addition  to the annual principal and
   interest  on these loans, bank service charges,  bond sale  expenses,
   and costs associated with redeeming bond  coupons should be in-
   cluded as well.

OTHER EXPENSES:  HELP

   This category  covers  any  expenditure items you may not have
   included elsewhere. Be aware that most "other" items can often  be
   properly accounted for under Administrative Costs.  This category
   would include the amount of any  actual annual funds placed in a
   specific  reserve account for facility  replacement or  depreciation.

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   18
                    OTHER  REVENUES
                   Other revenues  are all revenues that come into the wastewater system
                   other than user  service charges  and surcharges.  An  introductory
                   screen explains other  revenues  (see Figure  13).
                                          ENTERING "OTHER REVENUES" INFORMATION

                                      On the next screen, you will be asked to enter all revenue* other
                                   than user service charges. "Other" revenue Includes connection lees,
                                   special assessments, Interest on Investments, and any other revenue
                                   derived from any source other than user service charges and
                                   surcharges, Including any minimum fixed fee charged to users that Is
                                   not related to wastewater usage.
                                         Please press ENTER when you are ready to proceed.
Figure 13:
Instructions
for Entering
Other Revenues

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At  the OTHER REVENUES data  entry screen (see Figure  14), you're
asked to enter all other revenues.  While  the listing may  not  be com-
prehensive,  please enter all operating revenues other  than user service
charges  and  surcharges in  some  category on this  screen.  This screen
follows  the  format of  the  preceding screens, prompting for each  entry.
The program  then calculates a total, and allows use of the EDIT
MENU after  the  last entry.
                                   19
                  Anytown, USA
                  Determining User Sarvlca Charge Rates
                  Other Wastawater Revenues
                        Connection Fees
                        Special Assessments
                        Minimum Service Fee
                        Interest on Investments
                        Other Revenues
$10,000
 5,000
 20,000
 25,000
 3,000
                               TOTAL, OTHER REVENUES:  $63,000
                                                                                     Figure 14:
                                                                                Entering Other
                                                                                     Revenues
                                                                                 (with example
                                                                                          data)

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  20
                  TREATMENT  PLANT  STATISTICS
                  Instructions  on entering  wastewater flow and BOD and SS statistics
                  for your  treatment plant appear  on the next screen (see Figure  15).
                                   ENTERING INFORMATION ABOUT YOUR TREATMENT PLANT

                                   On the next screen, you are asked to enter the Biochemical
                                 Oxygen Demand (BOD) and Suspended Solids (SS) which your
                                 treatment plant receives every year, and how much i
                                 through the plant every year. You will be asked to enter these figure* In
                                 pounds for BOD and SS, and gallons for total flow. For example. If your
                                 plant handles 7 million pounds of Influent BOO per year, you would
                                 enter "7000000" (no commas) for that question.

                                   The numbers you provide would be tor the same period which you
                                 Indicated for the fiscal year In the "Expenses' section, which was:

                                                  FY1990

                                    Remember, these are ANNUAL figures, not daily or monthly.

                                      Please press ENTER when you are ready to proceed.
Figure 15:
Instructions
for Entering
Treatment Plant
Statistics
                                                                      \
                  After reading the information screen, pressing ENTER  takes  you to a
                  data entry screen (see Figure 16 on the next page) where the first
                  item requested  is ANNUAL  WASTEWATER FLOW. This should be an-
                  nual — not  monthly or daily flow — and it should  be  in  gallons —
                  not hundreds, or thousands, or millions of gallons. It may seem cum-
                  bersome typing all  those zeros, but it ensures accuracy  in  the rate cal-
                  culations  and avoids the confusion of using terms such as "MGD" or
                  "flow in  OOOs." The next three items follow the same format: annual
                  influent BOD, SS figures in pounds (not long or short tons or  hun-
                  dredweight), and total annual industrial wastewater  flow.  All four of
                  these figures are  critical to  determining the user service charge  basic
                  rate and  the  industrial  surcharge, if any.  The annual total  wastewater
                  and industrial wastewater flows, BOD,  and SS  figures are for the
                  same reporting  period  (fiscal year or other 12-month period) that was
                  used for  the  WASTEWATER  OPERATIONAL EXPENSES figures.

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                  Anytown, USA
                  Determining User Sarvlca Charge Rates
                  Traatmarrt Plant Information
                  (ANNUAL RGURES)
                      What was the total ANNUAL flow
                      through your treatment plant
                      (In gallons):

                      How much Influent BOD did your
                      treatment plant receive
                      (In ANNUAL pounds):

                      How much Influent SS did your
                      treatment plant receive
                      (In ANNUAL pounds):

                      Total ANNUAL INDUSTRIAL
                      WASTEWATER flow:
   FY1990





1,000,000,000



   2,500,000



   2,200,000


 100,000,000
                                                                                             21
                                                                                              Figure 16:
                                                                                               Entering
                                                                                              Treatment
                                                                                        Plant Statistics
                                                                                          (with example
                                                                                                   data)
For  jurisdictions  that use metered water  to bill wastewater operational
costs, two  additional items are requested at the  bottom  of the  screen
(see  Figure 16a): annual metered water flow  figures in  gallons  for
residential, and  commercial/institutional  wastewater treatment users.
                       Total ANNUAL RESIDENTIAL
                       METERED WATER flow.

                       Total ANNUAL
                       COMMERCIAL/INSTITUTIONAL
                       METERED WATER flow:

                       Total METERED WATER FLOW
  750,000,000



   50,000,000

  900,000,000
                                                                                            Figure 16a:
                                                                                               Entering
                                                                                         Metered Water
                                                                                             Flow (with
                                                                                         example data)

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  22
                 RECOMMENDED  USER
                 SERVICE  CHARGE  RATES
                 The last  step in the program is the actual  calculation  of the basic
                 user service charge per 1,000 gallons of waste water treated, and an
                 industrial surcharge per 1,000 gallons, if required.  The resulting infor-
                 mation is placed, for metered water systems, in a  table that compares
                 typical wastewater  service charge bills under existing rates and the
                 new recommended  rate, including any industrial surcharges (see Fig-
                 ure 17).
Figure 17:
Recommended
Rates - Metered
Systems (with
example data)
                            Anytown, USA
                            Determining User Service Charge Rates
                            New Wastewater Rates Table - METERED WATER

                                       Rates per 1,000 gallons treated
                            User Type &
                             Gallons
                              Used
                              3,000
                              5,000
                              3,000
                              5,000
Current
Rate per
1.000G
 New
Rate per
 1,0000
                                    Residential, Commercial and Institutional
$2.00
 1.90
$2.00
 1.90
                                            Industrial
 $2.31
 2.31
 $4.38
 4.38
Monthly
 BUI
$6.92
 11.53
$13.13
 21.89

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For unmetered systems,  the  results are presented  on text  screens  (see
Figures 18 and  19)  containing  the  new basic service charge  rate, the
industrial  service charge  rate including any  surcharge, and  estimates
of  bills for  typical  residential  and  commercial  users.
23
                      RECOMMENDED WASTEWATER USER SERVICE CHARGE RATES

                        Baaed an the Information you have entered In the model, new
                    uniform wastewater user service charge rates have been calculated for
                    your jurisdiction. The new rates, Including Industrial surcharge rates If
                    necessary, have been saved on the default disk for your Lotus 1-2-3
                    flies as a file named NEWRATES.PRN. After you leave this screen, the
                    model stops running and the screen will show the area where the new
                    rates are displayed, which Is the same area saved as NEWRATES.PRN.
                    By using the arrow keys, you can view any part of the rate table which
                    may not appear on the screen.

                        NEWRATES.PRN Is a "Print" file, which means that It can t.i
                    printed using any word processor or any method which will print
                    standard ASCII-format text files. It CANNOT by printed from Lotus 1-2-3.

                        Before running the model again, you should either print or copy
                    NEWRATES.PRN If you want to save the results of this model run. DO
                    NOT erase or move NEWRATES.PRN; this would cause an error.

                           Please press ENTER when you are ready to proceed.
                                                                                                     Figure 18:
                                                                                               Recommended
                                                                                                   Wastewater
                                                                                                  User Service
                                                                                                 Charge Rates

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  24
                                    Anytown, USA
                                    Determining Wastewater User Service Charge Rates
                                    New Wastewater Rates Table - UNMETERED WATER

                                    The new wastewator user charge for residential customers at the rat* ol
                                    $2.08 per 1,000 gallons results In a "flat rate" monthly bill for a
                                    residential customer of:

                                                                    $ 11.64
                                    The new wastewater "flat rate" monthly bills for other users are as
                                    follows:
                                    Apartments (1&2 bedroom):                $ 8.73
                                    Apartments (3+bedrooms):                $ 11.64
                                    Restaurants and Taverns:                 $116.39
                                    Commercial/Institutional:                  $ 29.10

                                    The new wastewater user charge rate for Industrial customers,
                                    Including any surcharge:

                                                  $3.94 per 1,000 gallons
Figure 19:
Recommended
Rates-
Unmetered
Systems (with
example data)
                    The  recommended  new  rates and the  information  you entered into the
                    program is placed  in  a  text  file named NEWRATES.PRN, which  is
                    saved  to the default directory  for your Lotus 1-2-3 worksheet files.
                    This is a standard  ASCII text  file which can be printed  with any
                    word processor  or  any  other software  that can print ASCII files.

                    PRINTING  FROM  WORDPERFECT 5.0 OR  5.1

                    To print NEWRATES.PRN with  WordPerfect 5.0 or 5.1, start
                    WordPerfect the way you normally would, press  List Files,  and
                    type in the full name of  the directory where NEWRATES.PRN was
                    saved, which should be the  default  directory for your LOTUS 1-2-3
                    files, such  as C:\123 or  C:\123\FILES  or C:\LOTUS, etc. Find
                    NEWRATES.PRN in the  list  of files, highlight it and press  <1>  or
                      to retrieve  the file just  as you would a normal WordPerfect  docu-
                    ment.  Alternatively, press   Retrieve,  and type  in the  full
                    directory path and name  of  the file, and press ENTER. The file will be
                    converted  to  WordPerfect format  as  it is retrieved.  You will  want to
                    edit  the file before  printing  because it will  contain  extra blank lines
                    at  the beginning, at one location in the  middle  of the first page, and
                    at  the end of the text. You  may also need  to adjust the margins
                    and/or type  size.

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PRINTING  FROM MICROSOFT WORD

To print NEWRATES.PRN with Microsoft Word, start Word the way
you normally would and  select TRANSFER and then LOAD. Next  type
the full path and name of the file (e.g.  C:\123\NEWRATES.PRN) and
press  ENTER. You cannot use the   key  to list files in  LOAD be-
cause  NEWRATES.PRN doesn't end in .DOC like a standard Word
document.  The  file  will be converted to  Word format as it is retrieved.
You will want  to edit  the file before printing because it will contain
extra  blank lines at the beginning, at one location in  the middle of
the first page,  and  at  the  end  of  the text. You may also need to
adjust the  margins  and/or type size.

PRINTING  FROM IBM  DOS OR MS-DOS

To print NEWRATES.PRN directly from  DOS,  leave Lotus  1-2-3 or any
other  application and get to a  DOS prompt  (C:>, A:>, etc.). Make
sure you are in the directory  which contains your complete copy of
DOS.  On a hard disk  system, this will usually be C:\DOS or CABIN
or sometimes just C:\  if you keep DOS  in your root  directory.

Type  Print  [drive] [path] \NEWRATES.PRN, and press ENTER.  Drive  is the
letter  of the drive where the NEWRATES.PRN file is saved, and path
is  the directory or subdirectory where it  is stored. For  example, Print
C:\LOTUS\FILES\NEWRATES.PRN. DOS  will respond with  a question:
"Name of list device [PRN]:." PRN is the default destination  for the
file, and represents  the printer attached to your computer, or the  first
printer (LPT1 in DOS parlance) attached  to your network. If you want
to print the file to any other port  or device (LPT2, COM1,  COM2, etc.)
you should type it in here. Otherwise, just press ENTER and
NEWRATES.PRN will print on  the  printer attached to your computer's
parallel printer  port.

RE-STARTING THE PROGRAM

If  you want to see  the effect  of changing the  expenses, revenues, or
other  variables  on your wastewater rates, you  can do  this by
re-starting  the  program from the beginning.  The results of the pro-
gram  run you  just  completed  (NEWRATES.PRN) should be viewed
and printed before  running the program  using different assumptions
because the initial results will  be  replaced in that file by  new results.
25

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  26
              How THE PROGRAM WORKS  AND
              CALCULATING NEW RATES
              MANUALLY
The Lotus 1-2-3 program which calculates your waste water user service charges is
designed to minimize the time and effort required for this task. If you wish to gain a
more complete understanding of the program, the following worksheet describes
how the program calculates the user service charge rates. You can use the step-by-
step worksheet to manually calculate new user rates if you don't have access to an
IBM-compatible computer with Lotus 1-2-3.

If you meter fresh water, fill in items 1 through 4a.
If you don't meter fresh water, enter only items 3 and 4a.
Annual Residential Metered Water Flow (gallons)
Annual Commercial/Institutional Metered Water Flow (gallons)
Annual Industrial Metered Water Flow or Wastewater Flow (gallons)
Total Annual Metered Water Flow (1+2+3)
Total Annual Wastewater Flow
If you don't meter fresh water, fill in Items 5 - 11.
Number of EDUs
Type of Unit Units per unit
Single family residences 1 .00
Apartments (1-2 bedrooms) 0.75
Apartments (3+ bedrooms) 1.00
Commercial/Institutional 2.50
Restaurants and taverns 10.00
Industries
Grand Total EDUs (5+6+7+8+9)
1
2
3
4
4a

Total EDUs
(Units x EDUs per)
5
6
7
8
9
10

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Non-Industrial Wastewater Flow                                                        f\ ™T
[Item 4a minus Item 3]                                    _ 11            M f

For both metered and unmetered systems, fill in Items 12 - 19, and 20 - 23 or 26 - 32.

Total Annual Influent BOD (pounds)                       _  12

Calculate Normal Annual Influent BOD (pounds)
[Item 4a times .002294 pounds per gallon]                   _  13

Calculate Excess BOD
[Item 12 minus Item 13] If Item 12 is less than Item 13, enter 0.  _  14

Percentage Excess BOD
                                                       _  15
Total Annual Influent SS (pounds)                         _ 16

Calculate Normal Annual Influent SS (pounds)
[Item 4a times .002294 pounds per gallon]                   _ 17

Calculate Excess SS
[Item It minus Item 17] If Item 16 is less than Item 17, enter 0. _ 18

Percentage Excess SS
[(Item 18 divided by Item 17) times 100]                      _ 19

If both Items 15 and 19 equal zero, then complete Items 20 through 23 and the
appropriate metered item (24) or unmetered items (25 through 25e).

Total Expenses (see pages 11-16)                          _ 20

Other Revenue (see pages 17-18)                          _ 21

Net Expenses [Item 20 minus Item 21]                      _ 22

1,000s of Gallons Wastewater [Item 4a divided by 1,000]        _ 23

Metered Water

Actual Wastewater Rate (per 1,000 gallons)
[Item 22 divided by Item 23]                                _ 24

New User Service Charge Rate (per 1,000 gallons)
[Item 24 times (Item 4a divided by Item 4)]                   _ 24a

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28
Unmetered Water

New User Service Charge Rate (per 1,000 gallons)
[Item 22 divided by Item 23]                                	 25

   Residential, per month
   [((Item 11 divided by 12,000) divided by Item 10)
   times Item 25]                                         	25a

   Apartments, 1-2 bedroom, per month
   [Item 25a times 0.75]                                   	25b

   Apartments, 3+ bedrooms, per month)
   [Item 25a times 1.00]                                   	25c

   Commercial/Institutional, per month
   [Item 25a times 2.50]                                   	25d

   Restaurants/Taverns, per month
   [Item 25a times 10.00]                                  	25e

If either item 15 or 19 is greater than zero, then complete Items 26 through 32 and the
appropriate metered items (33 through 34b) or unmetered items (35 through 36a).

Total Expenses (see pages 11-16)                           	 26

Other Revenue (see pages 17-18)                           	 27

Net Expenses [Item 26 minus Item 27]                       	 28

1,000s of Gallons Wastewater [Item 4a divided by 1,000]        	 29

Enter Item 15 or 19, whichever is greater                     	% 30

Portion of Treatment Costs Attributable to
Normal Strength Wastewater
[100 divided by (100 plus Item 30)]                           	 31

Portion of Treatment Costs
Attributable to Excess BOD or SS
[Item 30 divided by (100 plus Item 30)]                        	 32

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Metered Water

Actual Wastewater Rate (per 1,000 gallons)
[(Item 28 times Item 31) divided by Item 29]	33

New User Service Charge Rate (per 1,000 gallons)
[Item 33 times (Item 4a divided by Item 4)]                    	33a

Actual Industrial Wastewater
Surcharge Rate (per 1,000 gallons)
[(Item 28 times Item 32) divided by (Item 3 divided by 1,000)]     	 34

New Industrial Wastewater
Surcharge Rate (per 1,000 gallons)
[Item 34 times (Item 4a divided by Item 4)]                    	34a

Total New Industrial User Service Charge Rate
(per 1,000 gallons) [Item 33a plus Item 34a]                   	34b

Unmetered Water

New User Service Charge Rate (per 1,000 gallons)
[(Item 28 times Item 31) divided by Item 29]                    	 35

    Residential, per month
    [((Item 11 divided by 12,000) divided by Item 10)
    times Item 35]                                          	35a

    Apartments, 1-2 bedroom, per month
    [Item 35a times 0.75]                                    	35b

    Apartments, 3+ bedrooms, per month
    [Item 35a times 1.00]                                    	35c

    Commercial/Institutional, per month
    [Item 35a times 2.50]                                    	35d

    Restaurants/Taverns, per month
    [Item 35a times 10.00]                                   	35e

New Industrial Wastewater
Surcharge Rate (per 1,000 gallons)
[(Item 28 times Item 32) divided by (Item 3 divided by 1,000)]     	 36

Total New Industrial User Service Charge Rate
(per 1,000 gallons) [Item 35 plus Item 36]                     	36a
29

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ACKNOWLEDGMENTS
This publication and computer program were prepared by Haig
Farmer of the U.S.  Environmental Protection Agency, and William J.
Finane, Jr. and Sharon H. Fitzgerald of The University of Tennessee
Municipal Technical Advisory Service (MTAS).

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