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City of Dallas

Dallas, Texas, United States

Water and Wastewater Cost of Service Rate Study 

In 2017 – 2018, Raftelis completed a cost of service rate study for Dallas Water Utilities (DWU). DWU annually updates its current cost of service, but recent changes in customer demand patterns has caused DWU to consider the overall proportional demand placed on the system by its customers and customer classes. The focus of the study was on the completion of cost of service studies for water and wastewater retail services and consideration of alternative rate structures to address changes in customer characteristics and consumption behavior. Raftelis reviewed the current approach, considering recalibrating the cost of service process, and assessed the effectiveness of its existing rate structure compared to the current objectives of the utility. 

For successful evaluation of the retail classes, clearly and accurately identifying the retail costs and how they integrate with DWU’s existing wholesale cost of service model, which uses the utility basis approach, was a primary consideration during the cost of service process. Raftelis reviewed the wholesale cost of service to ensure all costs are accurately being allocated to the respective classes and that the overall cash needs of the utility are being met. Raftelis developed a new cost of service model for use by staff for future use and that will integrate with DWU’s existing wholesale model. 

Stormwater Rate Structure Change 

Raftelis is assisting the City of Dallas (City) to study and implement a stormwater rate structure change. The rate structure change represents a significant effort on the part of the City to assure the financial stability of its Storm Drainage Fund, recover costs more equitably from its ratepayers, and to do both in a transparent fashion. Raftelis conducted a stormwater cost of service analysis and updated the City’s stormwater financial plan, and we are implementing the rate structure change. As part of the rate review, Raftelis updated the City’s available impervious area data to evaluate the potential rate structures, and performed a stormwater account review in addition to evaluating the City’s current billing mechanism.  

The City has decided to proceed with implementing the recommend rate structure change, and Raftelis is currently in the process of updating the City’s stormwater billing data and developing an integrated stormwater billing system to facilitate billing data and account maintenance. Raftelis is also assisting the City with necessary rate ordinance changes and with public outreach around the rate structure changes. This includes developing a public-facing stormwater fee finder site for customers to look up their potential stormwater fees as well as information for the general public on the proposed rate impacts.  

Raftelis is also supporting customer service in responding to customer inquiries and is continuing to assist the City in developing targeted outreach to affected customers.