Monday, April 15, 2013

Introduction to a Rate Analysis

Though I started this Internship January 14, 2013, it has taken me some time to figure out the blog.  I have been working with the City of Gunnison's Public works Department to analyze their rates for water and sewer.  I just recently started the sewer rates, so the majority of my blogs will be on the water rate analysis I have performed.

As you all know, the resources we use do not come to our houses for free.  The City of Gunnison has meters for water, sewer and electricity in each house within the City limits.  Each month, these values are read and the consumer is charged per how much they used the given month.  The City is responsible for providing a safe and efficient product and therefore the cost of business increases each year.  Outdated or broken equipment as well as an inefficiencies in the system, such as a water leak, must be fixed as soon as possible to maintain a quality product and a profitable system.  The City of Gunnison has not increased their rates for water or sewer since 2009.  Since the cost of business increases each year, this has created an inefficient system that cuts into its reserve funds each year.

I was hired on by the City of Gunnison to take a closer look at these rates.  I will be taking into account future drought possibilities, costs of business and rates of similar communities.  After looking into this information, I will be able to suggest possible future rates for the City Council to review.

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