April 2013

Week 11 (April 1-5)

I began the week by finishing entering the sewer rates in Excel, I now had the information from each community I was going to compare rates with.  I compared the cost for commercial as well as residential charges at a minimum monthly rate as well as various amounts of usage, just as I had done with the water rates.

On Wednesday, Ken Coleman contacted me to come and pick up my proposal.  I went to his office to pick up my proposal and we talked about all the changes he wanted to see in the next draft.  Ken had gone through my proposal thoroughly, marking up everything he wanted to be changed, explained further or cut out. I told him how I had already changed the rate increase options to A, B and C.  I also told him how I had seen a news report on Denver Water within the past week and thought I could add in a section on the drought implications for this summer.  He agreed that it would be a good addition to the paper as well.  I spent the rest of the week going through the edits Ken had given me.  I added a section about the effects of two insufficient years of snowfall.  Denver Water had already declared its district to be in a Stage 2 Drought effective immediately.  In a stage two drought, not only are there restrictions on watering lawns and general water use, but there is also a rate increase in effect in order to promote conservation of water by the customer.  This could be another good reason for a rate increase for the City of Gunnison as well. 

At this meeting, Ken also advised me that I not prepare a PowerPoint for my presentation to City Council.  He said they are usually too difficult to run and would be unappealing to the members of council.  We still agreed that my proposal would be too long to rely on the members to read it prior to my presentation and that I should also make a summary, something one or two pages that they could quickly read to get the gist of my project.  As I went through the corrections that Ken gave me, I also set up my summary.

  

Week 12 (April 8-12)

Since I was presenting my findings to council next Tuesday, I spent Monday finishing tuning up my rate proposal as per what Ken Coleman had suggested.  I also completed my summary that included a couple charts. At the end of the day Monday, I e-mailed my new proposal and summary to Joe and Ken Coleman for review.

When I came in Wednesday morning, Joe’s supervisor, Ken Bradford “Tex” called me into his office.  Joe had passed along my report to him and he had some things he wanted to go over with me.  He had gone through the whole document and made his comments that he wanted me to look over later, but he had a very important piece of information for me.  Up until this time, I believed that I was supposed to be requesting a rate increase.  Tex informed me that Joe would like a rate increase, but it probably wasn’t going to happen.  Rather than to spend the time with council answering questions about what would happen if a rate increase were to occur, Tex wanted me to focus on the biggest problem with the current system, unaccounted water.  We spent the rest of our meeting brainstorming ideas that the water department could use to cut down on this problem.  Tex agreed that I should still suggest the rate increase as the next step, but fixing the unaccounted water needed to occur first.

I spent the rest of the week fixing my proposal and summary as to what Tex and I had spoken about and sent my final copies to him to be printed out for council on the following Tuesday.

Week 13 (April 15-19)

Tuesday, April 16, I presented my findings to the city council.  I spent most of Monday preparing what I was going to say as I was extremely nervous.  I was the last of the five internships to present on Tuesday night.  As I listed to the other interns give their reports, I realized that I had a lot of good information in my report and I was not scared anymore.  I gave my presentation to council quickly but still displaying all of the information that I had found.  The council members were then given a chance to ask me questions, and they had a lot of them.  I was able to answer them all immediately and with references to my report.  They then asked me how I had enjoyed the internship thus far.  I told them about how much I had learned and how it was very interesting to see another side of the water equation in the City.  If it were up to me alone, I would set the prices much higher in hopes that the water would be used much less!  My supervisors then all complimented the work I had done and clarified a couple points I had made.

I spent the rest of the week editing my proposal as to clarify the questions from the council meetings.  I also began working on the rate analysis for sewer once again.

Week 14 (April 22-26)

The beginning of the week Joe gave me a copy of an e-mail he had received from Wendy Hanson in the City of Gunnison’s finance department! She had gone through my report and had lots of clarifications for me.  She apologized for not reading the proposal before I went to City Council with it, but this is a learning process for everyone involved!  Wendy said that as this project goes on, they will begin to have students meet with some sort of committee, including a finance representative to make sure that the information is all accurate before it is made public at Council.

The first discrepancy Wendy had was how I said bills were assessed.  I was led to believe that the user was billed per 1,000 gallons that they used.  Anything over the 1,000 gallons was then billed to the customer the next month.  Wendy informed me that this was incorrect.  The users are billed per gallon that they use each month, the rates just increase at the tiers.  I assumed that this was the way it was billed to begin with, but I was told otherwise.  It was an easy fix in my summary and proposal.

The other discrepancy that Wendy saw in my work was my value of $2.03 for each 1,000 gallons the city provides to the customer.  Wendy got a number of $1.70.  I e-mailed Wendy telling her how I had come up with the number and we decided it would be best to meet up and talk.  I met with Wendy on Friday and we went over our numbers.  The discrepancy came from the fact that I included the capital costs of the City and she did not.  She informed me that this money comes from the minimum monthly payments and should not be included in the cost per 1,000 gallon for the City that I had come up with.  I spent the rest of the week making these, and the other changes Wendy informed me of, to both my summary and proposal.

Week 15 (April 29- May 3)

I began the week going through my final draft of my report one last time, I want this thing to be bullet proof when I finally turn it in! I decided to add one last section on the monthly minimum.  I made a graph that compared only the monthly minimums for the like communities.  Since Woodland Park does not have one, it was not included in this graph.  I then placed the graph in the section that I introduce Option A.  I explain that by looking at Figure 7 (the graph) one can see that the addition of a $5 to the monthly minimum still keeps Gunnison with one of the lowest monthly minimums in the comparison study.

I then began working on the sewer rate analysis.  I compiled as much as I could of the information that was on my water rate analysis Excel form.  I made graphs and took a look at the numbers.  Surprisingly, the City of Gunnison sewer rates are very close to the average.  I do not believe that a rate increase would be necessary after taking a look at all the information.  Not only were the values close to the average of the other twenty-one cities in the study, but the revenue coming in was covering the budget as well. 

On Friday, I sat down with Tex and Joe to conduct an exit interview.  We talked about all the things I had learned.  I explained to them how when I started this internship, I had no idea what I was in for.  It was so interesting for me to see a different side of the water issues, especially in a place where I had learned so much about, Gunnison.  I also explained to them how different it is going from focusing on conservation and sustainable use of resources to saving the most money and very little environmental consideration.  Both Tex and Joe then commended me for my work and told me that they would stay in touch to let me know what happens when they present my findings to the new council.  Joe mentioned that it may take a couple tries with council to get a rate increase approved, but my information will help them to make a good case!

March 2013

Week 8 (March 4-8)

This week I finished up my proposal. I also calculated the average cost for the City of Gunnison to treat and supply water to the customer.  Since 2009, I found that on average, it costs the City $2.03 per 1,000 gallons used.  This is a problem that I included with the current system in that the highest tier does not even account for this amount.  In total, my proposal is now 16 pages, with four pages of graphs that compare the rates for the City of Gunnison to other communities that are similar.  I have provided four options for rate increases.  Option A consists of a $5 addition to the monthly minimum, followed by a 5% rate increase to each tier.  Option B consists of a 20% increase across all tiers, Option C a 15% increase and Option D a 10% increase to each tier.  In my suggestions, I ask that Option A be adopted immediately in order to build up the reserves as quickly as possible.  I also suggested that if Option B or C be adopted that they be phased in.  For example Option B would have a 10% increase effective immediately followed by another 10% increase in, or around the month of September 2013.  This would allow for the customers to gradually accept the rate increase! On Friday, I sent Joe a copy of my rough draft proposal.

Week 9 (March 11-15)

This week, I heard back from Joe that my proposal was good and that he would like me to make a PowerPoint for when I will be presenting my proposal to council.  I spent most of the week going through my proposal once again, as well as making a PowerPoint for when I will be need to meet with council.

Once I was done with that, I began collecting the rates for sewer departments around the state.  I did this the same way that I did for the water, beginning by looking at all of their websites for the information and sending out an almost exact e-mail to the cities that I couldn’t find rates for.  I will call the communities I haven’t heard back from when I return from Spring Break.

 

March 18-22 SPRING BREAK

Week 10 (March 25-29)

At the beginning of the week, Joe and I visited Ken Coleman, the City Manager of Gunnison.  I did a preliminary proposal from him and he had lots of changes that he wanted me to make.  First off, he advised that I suggest an increase in the meter prices.  For example, the charge I used as my base was for $3.99, Ken Suggested that I make it $4.00 even.  He also suggested that I re-evaluate my options for rate increase.  Ken liked my option A in which there is a dollar amount increase  to the monthly minimum as well as an increase in the rates.  He suggested that I change my other Options so that each Option Generates the same amount of revenue.  I spent my week fixing both of these issues that Ken had.  I developed only three Options for rate increase.  Option A remained the same while Option B became a $4 raise to the monthly minimum and a 10% increase to the rates and Option C became a $3 increase to the monthly minimum and a 15% increase to all of the tiered rates.

After I was done making these, as well as the other minor changes Ken, Joe and myself discussed, I began working on the sewer rates once again.  I started by calling the three communities I had not heard from and then began entering the rates into an excel graph as I had for the water rates.

February 2013

Week 4 (Feb 4-8)

            I spent the first part of the week completing my charts.  I added on to the first chart by finding the populations of each community.  I messed around with the chart a bit, organizing it by different rates to get a feel of where Gunnison lied on the charts in comparison to all the other communities.  When I added the populations, I saw that Gunnison had lower rates than every community.  In fact the only community that even came close to the rates of Gunnison was Alamosa.  Alamosa’s rates were pretty similar, but still higher and the next closest communities were almost double what Gunnison charges.  This is due to the fact that Gunnison has not increased its rates for years, while other communities raise their rates between 3-10% each year.

            With the populations included, I wanted to see what the rates were for the communities that were most like the size of Gunnison’s population.  So I made a third chart that compared the populations between 4,000-7,000 members since Gunnison sits at about 5,886 members.  From the original list of communities that Joe gave me, this range included only Aspen, Carbondale, Eagle, Estes Park and Salida.  Once again, the charges for Gunnison didn’t even account for half of what these other communities were charging their customers.

            At this point, Joe had been telling me that an increase of about 5% is what was usual and about what we should be doing.  When I showed him these graphs and talked to him about how much other similar communities have been charging, this began to change.  For the rest of the week, I kept crunching number and testing situations.  I began entering a 5% increase, a 10% increase and finally a 20% increase onto each of my charts for comparison.  Even with a 20% increase, bills were only raised a couple of dollars since the rates were so low to begin with.  This is where I have left off this week.

Week 5 (Feb 11-15)

            This week I have spent most of my time looking over the past expenses and revenues, the future fixed expenses and the five-year capital improvement plan for the water department.  I have been compiling this data into charts on the same excel sheet as before.  It was interesting to see the budget that the department is given each year and how much they actually spend, usually going over and dipping into reserves in each category.  Once looking at this, it was obvious that the rates needed to drastically increase.  Not only does the department need to be charging more to account for the expenses of each year, they needed to increase to replenish the reserves and to account for the capital improvements necessary.

            Joe and I also spent some time looking at the amount of water that is pumped out of a well each month and how much is actually billed to the customers.  I was surprised to see how much more is pumped than is billed.  Of course some of the pumped water escapes through leaks, fire hydrant testing and other random occurrences, but that should only be a small fraction of the actual amount billed and most months it was almost double.  I asked Joe what else it could be that is causing this large discrepancy.  We only really talked about one problem, the meters.  The meters around the city of Gunnison are extremely outdated and could be reading completely inaccurate numbers.

            This is when I began thinking that we needed to increase the minimum monthly payment.  I started playing with numbers and decided that a $5 increase on a monthly payment and a 5% increase across the board for the rest of the rates would be the best way to go.   Immediately this $5 addition will go to installing new meters around town.  This will not only make reading the meters quicker as they are all electronically linked to the system, but it will also increase the accuracy that the meter reads and hopefully cut back on the unaccounted for water.  After these new meters are payed off, this extra revenue can go towards other system improvements and eventually help to reimburse the reserves.  The revenue increase of 5% will also account for inflation in the expenditures of the department.

 

Week 6 (Feb 18-22)

            This week Joe gave me a computer program that is to help me develop a rate structure.  I began going through the program and filling out all of the information, even though most of it is information I already have in my excel charts.  It was good for me to go through this program though because it organized my information in a way that was easier for me to read the information as a whole.

            The program was also beneficial for me to go through because it brought some questions to my attention.  I finished out filling out and reading the 56 pages today and now I feel like I have everything I need to get going on a rate increase proposal.  I did bring to Joe’s attention the information that I will need to move forward, which I discovered while filling out the program.  For instance, I need to know how much water is used to flush systems, for fire training and things like that.  I discovered that on an average over the past two years, the City of Gunnison has been pumping a way higher volume of water than it is billing its customers.  On average, 34% of the water pumped is not billed for which is completely unacceptable.  The introduction of updated meters will help cut this number back, but not completely.  Having a number for how many gallons are spent flushing systems and such will help make my report more accurate.

            I also would like to figure out how many customers each month are using more than “x” gallons.  For instance, if there are a lot of people using over 20,000 gallons a month maybe we need to include another tier to promote more water conservation.  I also would like to know how many new connections are made each year as they provide much more revenue than the average water sales.  I also asked Joe what he would like the reserves to be.  It has been depleted much more than it has been replenished in the past few years, so I am going to attempt to build it up to where it should be.

Week 7 (Feb 25-Mar 1)

            At the beginning of the week I read through old rate increase proposals to get a better sense of what I would be doing next.  I also took a look at the proposal that the City of Salida had available online from 2012.  I noticed that all of the graphs had an average included in their comparisons, so therefore I added one to each of my tables and graphs as well. 

            This week I also went over everything that Joe wanted to see in the proposal for the rate increase.  I also made sure to clarify some last minor details that I wanted to include in the proposal.  Joe agreed to look into them for me, but he may not figure them out in time for my first draft.  When going through the numbers we also realized that all of my Gunnison calculations were for a larger meter size than the average.  I had calculated all the rates at a 3/4” meter when the average user only has a 5/8” meter.  This resulted in my numbers all actually being higher than what the average person pays.  It did not take me long to correct my mistake and fix my averages as well.

            Friday I began writing the proposal.  I have decided to break it up into 8 sections to introduce the current plan in place, its problems, provide my graphs, explanations, suggestions and finish with my other options and any other needed data.  I chose to write my proposal this way, because it is how it was introduced in the past.  I only began the proposal this week, but I look to have a draft to Joe by Wednesday next week.  I will begin to work on setting up the sewer rate study as I wait for instructions from Joe on what to do for the next draft of my proposal.

January 2013

Week 1 (Jan 14-18)

            The first day at the internship I spent my time reading through old water and sewer rate studies and read through old books on how to perform a rate analysis.  These were both very helpful in helping me to understand the process of collecting all the data I would need and how to analyze the information I gathered.  The books that I was provided showed me different ways in which we could charge for water use, which will be interesting to see if I will be given the chance to completely restructure the rate tiers or if I will just be increasing the current rates.  The latter part of the week I spent doing more reading from the books Joe provided me.  I then created a list of twenty like communities that we will be comparing to Gunnison’s water rates. I began going onto websites for each community to find their water and sewer rates or contact information for the Finance Department.

Week 2 (Jan 21-25)

This week we had Monday off for Martin Luther King Day so I only was at the office Wednesday and Friday.  I continued going on to the websites of the like communities to find their water and sewer rates.  Some of the rates were very hard to find, or I couldn’t find them at all, while other communities had links to their rates on their homepage.  Once I found the rates, I printed them out and filed them for once all the information was gathered.  I also made note of the contact information for the finance department of each city just in case I did not get enough information or I had a question in the future.  For the communities that I could not find rates for, I constructed an e-mail that I sent out on Friday.

I am an intern for the City of Gunnison, Public Works Department, working on a rate analysis of water use. I am writing this request to municipalities which have similarities to the City of Gunnison for the purpose of obtaining information on your sewer and water rates for commercial and residential use as well as water and sewer tap fees.

I have been able to find this information on some city/town websites, so if this information is available on-line I was unable to find it and would greatly appreciate a response as to where I should be looking. If not, could you please fax (970-641-8021) or e-mail the information as a reply to myself (the above address) or to my supervisor, Joe Doherty (joe@cityofgunnison-co.gov).

I would like to thank you for your assistance in this matter and this department will be more than willing to reciprocate to any similar requests that you may have in the future.

Best Wishes,

Brittany Saeman

            I will be looking for the responses to the e-mails on Monday and making sure I have all of the data collected that I will need from each of the like communities.

Week 3 (Jan 28- Feb 1)

            This week I spent compiling all of the data I had received.  Any community that did not respond to the e-mail was called.  Once I had all of the rates, I began to make a couple charts in Microsoft Excel.  The first chart showed what each community charged as a base rate (for both residential and commercial as most communities have different rates).  I then figured out what each community billed for 5,000 gallons of water, 10,000 gallons of water and 15,000 gallons of water, once again for both residential and commercial rates.  I chose to calculate at these numbers because this is where the City of Gunnison tiers their water rates (tier 1: 0-5,000 gal, tier 2: 5,001-10,000 gal and tier 3: 10,001-15,000).  With this table, I will be able to compare the rates of other communities to our own.  Some of the rates were at a fixed rate and therefore no math was involved, but some were more difficult.  For instance, lots of smaller communities bill on a quarterly system and therefore I had to calculate what they were being charged on a monthly rate.

            After completing this chart, I began to make my second chart, with all the same communities.  This chart told what the communities were charging per 1,000 gallons used at 5,000 gal, 10,000 gal and 15,000 gal.  Once again, I chose these values because that is where the City of Gunnison changes their rates.    These two charts together are all that I will need to compare Gunnison’s water rates to those of other cities.  I also found and printed out a rate study report on the City of Salida’s website.  They had a chart like mine, comparing the rates in Salida to like communities, and I will also be able to use their rate analysis as a reference when I am trying to write my proposal.

            This week Joe also gave me an article to read in Headwater’s Magazine that was talking about the water rates in Colorado.  The article focused on water rates in the Front Range, but explained the significance of fixed and tiered water rates.  After talking with Joe, we have decided not to change the system currently in place, but to increase the current system at rate of x%.

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.

The Pamphlet Distribution Report for March

So, after cruising around Gunnison for an hour and checking on the stashes of ORE pamphlets, I have come to the conclusion that people need to seriously pick more of them up.  Anyway, below is a summary of the current status of the pamphlets around town and on campus as of March 27th, for those of you who may be interested in finding a few of 'em.  Beside each number of pamphlets for each business, I have put the number of pamphlets that I have added to each cache, assuming they needed a restocking and I had enough of a given booklet on hand.  Also, my apologies for the extreme length of this post.  No compromise on the full list of booklets!

On Western’s Campus

Kelley Hall:

Main Recycle Bins:

-           3x EnergySmart +1 = 4x

-           9x ORE Information

-           2x Local Farms First +1 = 3x

-           10x EnergyWise

-           6x Pocket Guide to Energy Efficiency

-           8x Green Business Directory

Student Room:

-           8x Green Business Directory

-           1x Local Farms First +1 = 2x

-           5x EnergyWise

-           4x EnergySmart

-           4x ORE Information

-           4x Pocket Guide to Energy Efficiency

Downstairs Table #2:

-           2x Green Business Directory

-           0x Local Farms First

-           5x EnergySmart

-           4x ORE Information

-           5x EnergyWise

-           4x Pocket Guide to Energy Efficiency

Upstairs Table #1:

-           2x Green Business Directory

Upstairs Table #2:

-           0x Green Business Directory

-           4x ORE Information

Upstairs Table #3:

-           2x Green Business Directory

Taylor Hall Downstairs:

Recycle Bins #1:

-           2x ORE Information +3 = 5x

-           3x Green Business Directory +2 = 5x

Recycle Bins #2:

-           5x ORE Information

-           1x Green Business Directory +4 = 5x

Leslie J. Savage Library:

Main Table:

-           1x Green Business Directory +3 = 4x

-           9x ORE Information

-           3x Pocket Guide to Energy Efficiency

-           9x Local Farms First

-           10x EnergySmart

-           10x EnergyWise

College Center:

Main Booklet Table:

-           20x ORE Information (took 38 back with me)

-           8x Green Business Directory

-           17x EnergySmart (were originally 69, took 52 back)

-           10x EnergyWise

-           6x Local Farms First

-           13x Pocket Guide to Energy Efficiency

Freecycle:

-           7x Green Business Directory

-           9x Pocket Guide to Energy Efficiency

-           5x ORE Information

-           5x Local Farms First

-           5x EnergySmart

-           5x EnergyWise

Around Gunnison

Natural Foods Market:

-           4x Green Business Directory +1 = 5x

-           5x EnergySmart

-           5x EnergyWise

-           1x ORE Information +5 = 6x

-           5x Pocket Guide to Energy Efficiency

Mocha’s:

-           4x Green Business Directory +1 = 5x

-           4x ORE Information +1 = 5x

-           3x Local Farms First +3 = 6x

The Bean:

-           9x Green Business Directory

-           9x ORE Information

-           7x Pocket Guide to Energy Efficiency

-           18x EnergyWise

-           5x EnergySmart

-           4x Local Farms First +6 = 10x

Brick Cellar:

-           9x Green Business Directory

-           10x Local Farms First (undetermined)

-           10x EnergyWise (undetermined)

-           10x EnergySmart (undetermined)

-           10x ORE Information (undetermined) +9x

-           3x Pocket Guide to Energy Efficiency

Mario’s Pizza:

-           9x ORE Information

-           6x Pocket Guide to Energy Efficiency

-           7x Local Farms First

-           9x EnergySmart

-           9x EnergyWise

-           7x Green Business Directory

 

Totals Delivered:

-           Green Business Directory: 140x

-           ORE Information: 134x

-           EnergySmart: 83x

-           EnergyWise: 88x

-           Pocket Guide to Energy Efficiency: 90x

-           Local Farms First: 106x

Total Booklets Delivered to Locations: 641

Overall, the Local Farms First booklets seem to do the best, followed by the Green Business Directory.  The ORE Information and Pocket Guide to Energy Efficiency pamphlets do alright, not great though.  I am tempted to stop handing out the EnergySmart and EnergyWise pamphlets, as almost none of them have been taken over the past few months.  Perhaps this is just due to where I've put them.  Before the end of the semester, I am going to try to add a few more locations to the list, including Global Linings and the gardening place on Tomichi across from Sonic (the name eludes me at the moment).  If anyone else has a good idea or two, please post a comment and let me know.  My hope is that these handy little pamphlets will not only help to get the word out about ORE, but will also help out the businesses that I've placed 'em at.  Until next time.