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Water Rates FAQ

Click on a topic below to view the answers.

Why did you raise the rates on January 1, 2019?

The Service Authority’s goal is to set fair and equitable rates and fees while doing its part to provide clean safe drinking water to its customers and protect the environment. A key element of providing clean drinking water and protecting the environment is ensuring that the Service Authority’s infrastructure is maintained and in good working condition. This requires a significant capital investment every year. The Service Authority periodically recommends changes to rates to ensure we invest in our system in order to properly maintain our infrastructure, meet environmental regulations and continue to deliver the quality and reliability our customers expect from us.

How does the Service Authority set rates?

The Service Authority sets its rates based on the actual cost of service as it does not make a profit. An independent financial consultant, Stantec Consultants, Inc., conducted a rate study for the Service Authority and recommended an adjustment to the rates. The Service Authority’s Board of Directors has authorized a public hearing to consider the rates. The Service Authority’s rate setting philosophy is governed by the following principles:

  • Cost of service: The Service Authority’s rates must generate the revenue required to invest in and operate the system, perform needed repairs and replace its existing infrastructure. Customers pay the cost of providing service to their home or business.
  • Equity in rates: Rates provide equity among all customers, so that the rates for each customer class are fair and reflect the cost of serving that customer class.
  • Simple to understand: Rates should be easy to understand and calculate.
  • Stability: Rates should provide a stable revenue stream from year to year in order to ensure the reliable operation of the system.
  • Growth pays for growth: Revenue requirements for system operation and system expansion are developed separately. The cost of growth (treatment capacity, storage, etc.) is paid by new development while the cost of operations and capital replacements is paid by existing customers.
  • Minimize "rate shock": Rates should be adjusted in modest amounts annually to phase increases in gradually to ease the impact on customers.
  • Maintain Service Authority’s credit ratings: Rates are set to maintain the Service Authority’s strong credit rating. Strong ratings represent the Service Authority’s ability to meet its obligations in good times and bad and lower the Service Authority’s cost to borrow funds for large capital projects.

 

Does the Service Authority receive tax money from Prince William County?

No, the Service Authority does not receive any tax dollars from the County.

Why do you set your rates for three years at a time?

Setting rates for three years at a time allows rate increases to be phased in over time and avoid large rate increases in a single year that would burden our customers.

Can we defer rate adjustments?

The deferral of necessary rate adjustments could require the Service Authority to postpone necessary infrastructure replacement projects. Additionally, keeping rates artificially low results in higher rate increases in the future when the Service Authority is required to catch up with deferred infrastructure replacement.

How much more am I paying now that rates have increased?

A typical residential monthly water and sewer bill using 6,000 gallons increased by $1.40 in January 2019 and will increase by $1.90 in 2020 and $1.95 in 2021.

What are other local jurisdictions charging for water and sewer service?

In comparison with other local jurisdictions, the Service Authority’s rates in fiscal year 2021 remain competitive.

Why are some other jurisdictions able to provide water and sewer service at lower rates?

Each water and sewer utility sets its rates based on its own priorities, operating environment and capital needs. Some jurisdictions defer rate increases until it is absolutely necessary and some may delay the replacement of aging infrastructure.

The Service Authority is primarily a retail service provider and purchases most of its water from advanced water treatment plants owned by Fairfax Water. The Authority also participates in the Upper Occoquan Service Authority, which is one of the most advanced and costly water reclamation facilities in the country. Both of these factors impact the Service Authority’s cost of service and its rates.

The Service Authority is careful to ensure its rates are competitive with surrounding jurisdictions while making the investments necessary to provide clean safe drinking water to its customers and protect the environment.

What is considered an affordable water and sewer bill?

The Environmental Protection Agency’s affordability guideline for water and sewer service is 3.0% of median household income. Based on the Service Authority’s typical household consumption of 6,000 gallons per month, the Service Authority’s monthly water and sewer bills for fiscal years 2019 through 2021 are less than 1.0% of median household income.

Why does the Service Authority charge Commercial High Demand Charges?

The Service Authority’s water system is designed and constructed to supply drinking water on demand. As the County grows, the Service Authority expands the capacity of its water system to meet the needs of additional customers. New customers pay an Availability Fee at the time of connection based on the cost of expanding the system to meet those needs.
When commercial customers use more than their allocated water capacity, this reduces available capacity for the Service Authority’s other customers. To reduce the impact of some commercial customers placing high demands on the water system, the Service Authority assesses Commercial High Demand Charges to recover the cost of providing the additional water system capacity.

Why are High Demand Charges in place year round?

Commercial High Demand Charges are in place year round as commercial customers’ excess use is not limited to the residential peak season (May through October).

Why are some commercial customers exempt from High Demand I Charges?

Commercial customers with water-only or sub-metered service are subject to High Demand I and II. Commercial customers with both water and sewer service are only subject to High Demand II. This ensures equity between different types of commercial accounts and between residential and commercial customers.

Why did Commercial High Demand Charges go up?

Commercial High Demand Charges are based on the cost of capacity, the same as the Residential Peak Use Charges. In fairness to all our customers, these charges should be the same. Initially, the Commercial High Demand Charges were set lower than Residential Peak Use Charges to allow commercial customers to budget for the increased cost. To ensure our rates are equitable for all customers, the Service Authority has been gradually reducing the difference between Commercial High Demand Charges and Residential Peak Use Charges. In January 2021, this transition will be complete and the two charges will be the same.

Where can I get more information about the rates and fees?

Additional details and answers to questions can be provided by the Service Authority at 4 County Complex Court, Woodbridge, VA 22192, Monday through Friday, 8:30 a.m. – 5 p.m., telephone (703) 335-7910 or email finance@pwcsa.org.

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