ORANGE WATER AND SEWER AUTHORITY
SCHEDULE OF RATES, FEES, AND CHARGES

APPLICABLE TO ALL CUSTOMER BILLINGS ON AND AFTER OCTOBER 1, 2005
UNLESS OTHERWISE NOTED

SECTION I: SCHEDULE OF WATER RATES AND FEES

SECTION II: SCHEDULE OF SEWER RATES AND FEES

SECTION III: SCHEDULE OF MISCELLANEOUS CHARGES

Background and Authorization

In providing essential public water and sewer services to the Chapel Hill , Carrboro and portions of southern Orange County , Orange Water and Sewer Authority (OWASA) incurs substantial operating and capital expenses. OWASA operates as a nonprofit enterprise fund and has no legislative authority to levy taxes nor does OWASA receive tax revenues from local governments for ongoing operations. OWASA finances its ongoing water and sewer operations and extensive capital improvements almost entirely through customer paid fees and charges.

North Carolina G.S. 162A-9 requires that OWASA’s "rates, fees and charges shall be fixed and revised so that the revenues of the authority, together with any other available funds, will be sufficient at all times" to fund operating and maintenance expenses and to pay the principal and interest on all debt issued or assumed by OWASA. OWASA's rates are generally established under a cost-of-service rate-making methodology. Each customer pays for the costs incurred by OWASA to provide the services and/or facility capacity required to meet customer demand.

The OWASA Board of Directors has determined that revisions presented in the attached Schedule of Rates Fees, and Charges are necessary to adequately fund OWASA's ongoing operations and long-range Capital Improvements Program. Additional revenues generated by these rate adjustments will provide OWASA with the financial resources necessary to: (1) fund operating costs; (2) adequately maintain existing water and sewer facilities; (3) fully comply with increasingly stringent environmental and public health standards; (4) meet debt service requirements; and (5) to create additional facility capacity in order to stay abreast of water and sewer service demand in a growing, dynamic community.

The attached Schedule of Rates, Fees, and Charges will replace the schedule adopted on June 10, 2004 which became effective on October 1, 2004.

SECTION I: WATER RATES AND FEES

MONTHLY WATER RATES

Water charges are billed monthly at approximately 30-day intervals. Charges are due upon receipt of the bill, becoming delinquent 21 days after the original billing date. Monthly water rates consist of two components: a monthly service charge and a commodity (volume) charge.

Water Service Charge

This charge is calculated to recover costs related to certain direct and indirect customer service efforts, meter and lateral maintenance, and capital costs associated with supplying water to the customers' property. Applicable to all metered water accounts, independent of the quantity of water consumed, the monthly charge is based on meter size as follows:

Water Irrigation Service Charge

This charge is calculated to recover certain direct and indirect customer service, meter and lateral maintenance, and water capital costs associated with supplying water to properties with irrigation systems. Applicable to all metered irrigation water accounts, regardless of the quantity of water consumed, the monthly charge is based on meter size as follows:

Compound meter arrangements are billed on the largest meter in the grouping.

In addition to the applicable charge for the primary meter, existing sub-meters are billed according to the above schedule. Sub-meters are no longer available and no additional sub-meters will be installed.

Meter changes from one size to another are billed at the rate applicable for the size of the new meter.

Meter readings for first and final bills are billed at a prorated amount based on days of service.

Water Commodity Charge

This charge is calculated to recover the remaining direct and indirect costs of water supply and treatment, water distribution, general administration and water capital not recovered by the monthly service charge. This charge is applicable to all water accounts based on meter readings of water consumed.

When no meter reading is available due to an inoperative, damaged or inaccessible meter, consumption is estimated based on prior usage at the location and current use of the facilities at that time.

To achieve demand reduction during peak water usage periods, the OWASA Board of Directors adopted a conservation rate structure. A reduced commodity charge will be in effect during lower demand months (October through April), and a higher commodity charge will be in effect during high demand months (May through September).

Off-peak rate per 1,000 gallons (October through April) $2.74

Peak seasonal rate per 1,000 gallons (May through September) $5.20

Conservation Water Commodity Charges Under Mandatory Water Uses Restrictions

The peak seasonal conservation rate structure will be extended or invoked during periods of mandatory water use restrictions regardless of the time of year. During the various mandatory conservation stages, an inverted block pricing structure will be imposed in conjunction with the seasonal rate for residential and irrigation only customers. The inverted block structure for single family and multifamily individually metered residential and irrigation only customers is summarized in the following table.

INTERLOCAL WATER TRANSFER CHARGES

The purpose of this charge is to recover costs associated with the provision of supplemental water supply under contractual agreement with other water purveyors. The specific rates to be charged will be negotiated with the other party based upon specific conditions, but using the cost-of-service rate-making approach and approved by the Executive Director. The commodity charge for such interlocal water transfers shall not be less than seventy-five percent (75%) of the equivalent uniform water commodity charge applicable to all water accounts within OWASA’s service area unless OWASA and the other purveyor(s) have entered into an agreement establishing water transfer charges. This charge will not be subject to seasonal adjustments.

Equivalent Uniform Water Commodity Charge

Not less than seventy-five percent (75%) (unless OWASA and the other purveyor(s) have entered into an agreement establishing water transfer charges) of:

$3.93 Per 1,000 gallons

TEMPORARY HYDRANT METER CHARGE

Service from a fire hydrant for construction purposes is subject to priority use of such hydrant for fire protection. Temporary hydrant meters are available April through November and may be used by a customer at a single location for a period not to exceed 60 days. Subject to availability of inventoried hydrant meters, a $200.00 service charge, payable in advance, is collected for setting and removing the meter. In addition, a security deposit is required in accordance with the following schedule:

Security Deposit
$ 1,000.00

Monthly billings for temporary hydrant meters consist of two charges: (1) a service charge for that size meter, and (2) a commodity charge based on monthly readings of the meter. When the hydrant meter is returned undamaged, the security deposit is to be applied to the final bill and any credit balance will be refunded within thirty (30) days.

WATER AVAILABILITY FEE

Water availability fees are calculated to recover a portion of the capital costs of providing water system facility capacity. The availability fee is applicable to each new connection to a water main, regardless of who may have paid for the installation of the water main to which the connection is to be made. For the purpose of availability fees, customer accounts are divided into three categories: (1) Single Family Residential, (2) Multifamily Residential, Individually Metered; and (3) Nonresidential. The Nonresidential category includes master-metered multifamily apartment complexes and all commercial, University, and institutional accounts. The use of these categories is justified by distinctive patterns of water and sewer consumption.

WATER SERVICE AND METER INSTALLATION CHARGE

The purpose of this charge is to recover costs of extending service from the distribution system to individual properties, and includes the installation of a service connection from the water main to the curb or property line and the setting of a meter within the premises, subject to satisfactory easement or license being provided by the applicant. Where a suitable stub-out for service has been made and is available, the "meter-only" charge will apply. Complete water service installation and meter-only charges are as follows:

Complete installations are determined on a time and materials basis for 1-1/2 inch and 2 inch meters. For 3 inch and larger meters the applicant is responsible for providing a meter box or vault constructed to the configuration and standards of OWASA. All meters, regardless of size, are to be purchased from OWASA. A $60.00 delivery fee for 3-inch and larger meters will be applied.

WATER MAIN TAPPING FEE

The purpose of this charge is for making a tap into an OWASA water main. The tap fee must be paid in advance of OWASA performing the work, with a minimum of 48 hours advance notice given to OWASA.

The applicant shall be responsible for opening the ditch, providing adequate working clearance at the point of tap, adequately shoring the trench sidewalls, dewatering and such other associated activities as to provide a suitable and safe condition for OWASA personnel to complete the tap. Additionally, the applicant shall be responsible for providing an appropriate size tapping sleeve and tapping valve, and a backhoe or similar device shall be available on-site for lowering the tapping unit into the ditch line. All permits, bonds and paving shall be the responsibility of the applicant. The charge will be for time and equipment plus an allowance for overhead, but not less than $250.00.

The base fee noted above includes one (1) site visit by OWASA to determine if the applicant is ready for OWASA to perform the tap. A re-inspection fee of $55.00 will be charged for each additional site visit required to determine if the water main is accessible and all required material and safety measures are in place.

HYDRAULIC FIRE FLOW TESTING

This charge recovers the cost of hydrant ‘fire flow’ testing of the water distribution system. Test result data provide developer’s engineers to determine available flows and pressures in the systems they are designing for new developments.

$200.00 per test

SECTION II: SEWER RATES AND FEES  

MONTHLY SEWER RATES

Sewer charges are billed monthly at approximately 30-day intervals. Charges are due upon receipt of the bill, becoming delinquent 21 days after the original billing date. Monthly sewer rates consist of two components: a monthly service charge and a commodity (volume) charge.

Sewer Service Charge

This charge is calculated to recover the direct and indirect customer service, service and inspection maintenance, and capital costs associated with providing sewer service to the customers’ property. Applicable to all sewer accounts, regardless of whether or not there is a commodity charge, the monthly service charge is based on water meter size as follows:

Sewer Commodity Charge

This charge is calculated to recover the remaining direct and indirect costs of wastewater treatment and collection, maintenance, inspection, customer service and administration and sewer capital costs not recovered by the monthly service charge. This charge is applicable to all accounts receiving sewer service based on the water meter reading, sewer meter reading if applicable, or estimated volume of discharge as determined by OWASA.

$3.44 per thousand gallons

INTERLOCAL WASTEWATER COLLECTION, TREATMENT AND DISPOSAL CHARGES

The purpose of this charge is to recover costs associated with the provision of wastewater collection, treatment and disposal services under contractual agreement with other wastewater service providers. The specific rates to be charged will be negotiated with the other party based upon specific conditions, but using the cost-of-service rate-making approach and approved by the Executive Director. The uniform commodity charge for such interlocal wastewater services shall not be less than seventy-five percent (75%) of the sewer commodity charge applicable to all sewer accounts within OWASA’s service area unless OWASA and the other purveyor(s) have entered into an agreement establishing water transfer charges.

Not less than seventy-five percent (75%) (unless OWASA and the other purveyor(s) have entered into an agreement establishing water transfer charges) of:

$3.83 Per 1,000 gallons

MONTHLY RATES FOR SEWER ONLY ACCOUNTS

For existing sewer only accounts where there is no water meter, OWASA shall use the following as the basis for calculating the fixed monthly charges: (1) the monthly service charge shall be determined by the water meter size which would be required to supply water service to the property; (2) the billable quantity will be estimated using national engineering standards as the basis, but in no case shall the billable quantity be less than 6,000 gallons per month and at a rate of $3.83 per thousand gallons.

For special commercial and industrial customer classifications where the proportion of water consumed to wastewater discharged is extremely large, a metered sewer account may be approved. Metered sewer accounts must also pay the appropriate monthly sewer service charge based on the sewer meter size.

SEWER AVAILABILITY FEE

The purpose of this fee is to recover a portion of the capital costs of providing sewer system facility capacity. The availability fee is applicable to each new connection to a sewer main, regardless of who may have paid for the installation of the main to which the connection is to be made. For the purpose of availability fee, customer accounts are divided into three categories: (1) Single Family Residential; (2) Multifamily Residential, Individually Metered; and (3) Nonresidential. The Nonresidential category includes master-metered Multifamily apartment complexes plus all other commercial, The University, and institutional accounts. The use of these categories is justified by distinctive patterns of water and sewer consumption.

Sewer Availability Rates :

SEWER TAP CHARGE

This charge is for making a tap of the applicant's private sewer lateral into the main sewer line or sewer manhole of OWASA. The tap fee must be paid in advance of OWASA performing the work, with a minimum of 48 hours advance notice given to OWASA.

The applicant shall be responsible for opening the ditch, providing adequate working clearance at the point of tap, adequately shoring the trench sidewalls, dewatering and such other associated activities as to provide a suitable and safe condition for OWASA to connect the service lateral of the applicant into the facilities of OWASA. The minimum charge is based on a standard 4" service tap to the sewer line. All 6" lines and larger must be tapped into a manhole. All permits, bonds and pavement repairs are the responsibility of the applicant.

The charge will be for time and equipment plus an allowance for overhead, but not less than $285.00.

The base fee noted above includes one (1) site visit by OWASA to determine if the applicant is ready for OWASA to perform the tap. A re-inspection fee of $55.00 will be charged for each additional site visit required to determine if the sewer main is accessible and all required material and safety measures are in place.

HIGH STRENGTH WASTE SURCHARGE

The purpose of this charge is to recover operation and maintenance costs from customers whose wastewater discharge into the system is in excess of certain parameters for normal strength domestic wastewater as determined by OWASA. Based on local sampling and analysis, normal strength domestic wastewater has been determined to have the following pollutant characteristics:

High Strength Waste Surcharges shall apply at the following rates to all wastes exceeding the above concentrations:

SECTION III: MISCELLANEOUS CHARGES

SERVICE INITIATION FEE

The purpose of this charge is to defray the labor and administrative costs associated with the establishment of a water and/or sewer account. This includes establishing service and account records for billing. Applicable to all accounts requiring field work, be it setting a meter, reconnection of service or reading the meter.

$40.00 per event
$70.00 per event, outside of normal business hours of OWASA

RECORD CHANGE CHARGE

The purpose of this charge is to defray the administrative costs associated with the transfer of responsibility for an account from one customer to another. This does not require field work and is done at the request of the new customer. Record changes are conditional on the customer signing a statement assuming responsibility for the account balance, paying the record change charge, any delinquent amounts and any applicable security deposit.

$10.00 per record change

CHARGE FOR RECONNECTION OF DELINQUENT ACCOUNTS

Disconnection of water and/or sewer service for the reason of nonpayment may occur at the option of OWASA no sooner than 21 calendar days after the date of initial billing. The purpose of this charge is to offset the costs of special handling of delinquent accounts, which may include, but not limited to, the disconnection and reconnection of service due to nonpayment of the customer's bill. This charge is to be applied to all accounts scheduled for disconnection for nonpayment and is applicable on or after the specified disconnect date, regardless of whether the service was disconnected or not. Reconnection resulting from disconnection due to nonpayment will be made within 24 hours of receipt of full payment of balance due plus reconnection charge and applicable security deposit.

$40.00 per event, during OWASA’s normal business hours
$70.00 per event, outside OWASA’s normal business hours

CHARGE FOR TEMPORARY DISCONNECTION/SUBSEQUENT RECONNECTION AT CUSTOMER'S REQUEST

The purpose of this charge is to recover the cost to temporarily disconnect and subsequently reconnect water service at the request of a customer. Such requests may result from an emergency condition or routine plumbing system maintenance need. The charge may be waived if the customer provides documentation that a master cutoff valve has been installed within thirty (30) days of the date of the temporary service disconnection. However, this charge will not be waived for any customer that had a master cutoff valve on the premises before the temporary service disconnection. $40.00 per event

RETURNED CHECK CHARGE

Checks or automatic bank drafts made payable to OWASA are accepted as payment on account subject to collection. When a check or bank draft is not honored for payment by the bank or other institution on which it is drawn, a Returned Check Charge will be applied to the customer's account as follows:

The customer will be notified of the returned check charge and instructed to pay the amount due immediately. Failure to respond within the time allowed will result in disconnection of water service and an additional charge for reconnection. The customer may also be required to pay a security deposit.

SECURITY DEPOSITS

OWASA may require security deposits from customers to ensure payment of the final bill. To offset administrative costs in handling these monies, no interest will be paid on security deposits.

Security deposits shall be required on all accounts other than those in the name of (1) owners or tenants of single-family residential properties, detached or attached units, who can provide a satisfactory credit history or reference to OWASA, and (2) local, State and Federal governments or agencies thereof. Security deposits shall be required for accounts other than those in (1) and (2) above and shall be an average of three months' billing charges or $50.00, whichever is greater. In (1) above where satisfactory credit history or reference is not provided, the initial security deposit shall be $25.00. All security deposits must be paid at the time application for service is made and in advance of service initiation.

Any customer whose service has been disconnected for nonpayment of billing charges twice within a six month period of time will be required to pay a $25.00 security deposit prior to reconnection of service. Repeated disconnections will require additional security deposits until the customer has accumulated a security deposit balance, which will cover an average of three months’ billing charges.

Security deposits of residential customers may be refunded after the customer has established a satisfactory payment history of twelve (12) consecutive months. Otherwise, security deposits will be applied to the final bill when a customer's account is terminated.

BULK WASTEWATER CHARGES

Normal Domestic Septage

The purpose of these charges is to recover the costs associated with the service rendered by OWASA to those customers who discharge normal domestic septic tank wastes into the wastewater treatment facilities of OWASA. Applicable to those customers who have an account established at OWASA’s Customer Service Office, charges for handling normal domestic septage will be billed to the customer on a monthly basis. The monthly bill will include two components: (1) an administrative charge for special services required to receive this type waste and rendering the monthly bill; and (2) a charge for the treatment of the septage as determined by OWASA. This charge is calculated as follows:

Other High Strength Waste

Other wastes may be discharged to OWASA’s septage facilities only with prior approval by OWASA and upon OWASA’s direct inspection of the actual discharge. The costs associated with these services will be as follows:

Waste concentrations shall be as determined by OWASA.

TANK SALES OR BULK WATER SALES

The purpose of this charge is to recover the labor and administrative costs associated with the supply of bulk quantities of water to tank trucks or trailers from a metering point on the premises of OWASA. Applicable to all tank or bulk water sales, the following charges apply for each loading.

Bulk sales are subject to administrative regulations and controls for protection of the system and efficient operation. Water tank trucks or trailers are only authorized to withdraw water from locations expressly authorized by OWASA and for which adequate usage monitoring measures are provided. Charges for bulk sales are not subject to seasonal adjustments.

DIRECT SALES OF SUPPLIES

Applicable to the direct sale of supplies from inventory to municipalities or contractors, the supplies will be billed at the most recent cost plus a handling charge of 10%.

BOAT RENTAL AND LAKE USER FEES

General Public

Applicable to all persons using row boats and canoes on University Lake and Cane Creek Reservoir during scheduled hours of operation as established by OWASA, boat rental and lake user charges will be as follows:

OWASA CUSTOMERS AND ORANGE COUNTY RESIDENTS

ALL OTHERS

Applicable to all The University of North Carolina at Chapel Hill students, faculty and staff affiliated with boating or crew clubs sanctioned by The University.

$25.00 per boat per semester
$ 8.75 per member per semester

FIELD TEST OF 5/8" METER

Upon a customer's written request, OWASA will conduct a special field test of the customer's 5/8" water meter. There will be no charge for testing meters (1) which have not been tested during the past five years, or (2) which are found to be overregistering. Overregistering meters will be replaced by OWASA at no charge to the customer.

If, however, the meter has been tested within the past five years and the results of the meter test indicate proper or underregistering, the customer will be charged $50.00 or the meter test.

SHOP TESTING OF METER

Upon a customer's written request, OWASA will conduct a special shop test of the customer's water meter that is larger than 5/8 inches. There will be no charge for testing meters (1) which have not been tested during the past five years, or (2) which are found to be over-registering. Over-registering meters will be replaced by OWASA at no charge to the customer.

If, however, the meter has been tested within the past five years and the results of the meter test indicate proper or under-registering, the customer will be charged $80.00 for the in-house meter test.

FIELD TEST OF LARGE METERS

Upon a customer's written request, OWASA will conduct a special field test of the customer's water meter that is larger than 5/8 inches. There will be no charge for testing meters (1) which have not been tested during the past five years, or (2) which are found to be over-registering. Over-registering meters will be replaced by OWASA at no charge to the customer.

If, however, the meter has been tested within the past five years and the results of the meter test indicate proper or under-registering, the customer will be charged a meter test fee based on the actual time and equipment required to complete the field test. This charge shall not be less than $100.00.

PLAN REVIEW AND CONSTRUCTION OBSERVATION FEES

The purpose of this charge is to recover the operating cost for providing review of construction plans for the extension of water and sewer facilities. The charge also recovers the operating cost for providing field observation on the installation of these facilities. The plan review and construction observation fees are applicable to all extensions of the public water and/or sewer system regardless of the party which may be undertaking the improvements. The fees will be applied separately to water main and sewer main extensions, but in no case shall the fee be less than $100.00.

PLAN REVIEW AND CONSTRUCTION OBSERVATION FEES CONTINUED:

CHARGES FOR MISCELLANEOUS SERVICES

Charges for miscellaneous services provided by OWASA shall be on a time and materials basis and include out-of-pocket expenses, cost of materials and services supplied by third parties, and overhead. Typical applications would be for repair of damages to water and sewer lines by outside parties, special services for billing information, expenses related to spill containment responses, etc.

TRANSFER OF CHARGES

Any unpaid balance from past due charges for water and/or sewer services of terminated accounts or Charges for Miscellaneous Services will be transferred to any available active account(s) through which the customer is receiving services. The payment status of the active account through which the customer is receiving service will be determined by the payment status of transferred accounts.

OWASA may temporarily withhold service from a customer, or refuse service (including but not limited to individuals, corporations, or partnerships), from whom any unpaid, past due balance which is not in dispute is due OWASA for services or charges.

Accounts or portions of accounts, including charges for material or damaged property that are disputed and delinquent fees and delinquent assessment charges, may be submitted to the courts by the Executive Director, upon approval by General Counsel, for collection if such amounts do not exceed $1,500.00. For amounts exceeding $1,500.00, approval of the Board of Directors shall also be required prior to filing action for collection.

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RESOLUTION ADOPTING SCHEDULE OF RATES, FEES, AND CHARGES APPLICABLE TO ALL CUSTOMERS ON AND AFTER OCTOBER 1, 2005

WHEREAS, Orange Water and Sewer Authority has an adopted Schedule of Rates, Fees, and Charges as permitted under North Carolina General Statute 162A-9 and Section 7.04 of OWASA’s Amended and Restated Bond Order (Bond Order); and

WHEREAS, General Statute 162A-6(9) and Section 7.04 of OWASA’s Bond Order provide for the revision of such Rates, Fees, and Charges; and

WHEREAS, during the preparation of the Fiscal Year 2005-2006 budget, the need for rate adjustments to OWASA’s Schedule of Rates, Fees, and Charges was confirmed to finance and provide sufficient revenues for the ongoing operations and the Capital Improvements Program; and

WHEREAS, notice of a Public Hearing to receive comments on the proposed adjustments to Rates, Fees and Charges was published in The Chapel Hill News on Sunday, May 15, 2005; and

WHEREAS, A Public Hearing was held on May 26, 2005 for the purpose of receiving public comment on the proposed adjustment to the Schedule of Rates, Fees, and Charges.

NOW, THEREFORE, BE IT RESOLVED:

1. That the attached Schedule of Rates, Fees, and Charges be, and hereby is, adopted by the Board of Directors as the revised rate policy of Orange Water and Sewer Authority.
   
   
2. That the revised rates shall become effective for all service billings rendered on and after October 1, 2005.
   
   
3. That the Executive Director is authorized to make discretionary judgments regarding charges when it is determined to be in the interest of OWASA in resolving a customer’s appeal.
   
   
4. That the Executive Director is hereby directed to give proper notice to The University of North Carolina at Chapel Hill as required by the Sale and Purchase Agreements and to take the necessary steps to implement the revised Schedule of Rates, Fees, and Charges.
   

Adopted this 9th day of June, 2005.

______________________________
Mark Marcoplos, Chair

ATTEST:

__________________________
Penny Rich, Secretary-Treasurer