4th Edition

Water and Wastewater Finance and Pricing The Changing Landscape, Fourth Edition

Edited By George A. Raftelis Copyright 2015
    596 Pages 329 Color Illustrations
    by CRC Press

    A Strategy Guide for Water Utility Managers and Executives, and a Compendium of Best Financial Practices for Utility Financial Leaders, a "How-To" Guide for Rate and Finance Technicians and a Reference Point for Policymakers

    Detailing utility financial plans and rate structures, and highlighting how they align with community sustainability goals and utility objectives, is the focus of the fourth edition of Water and Wastewater Finance and Pricing: The Changing Landscape. Working from a historical perspective, this revised and updated text addresses the current pricing and financial management challenges involved in the water and wastewater industry. It builds on the concepts used in the standard manuals of the American Water Works Association and the Water Environment Federation, and offers additional insight into the long-term sustainability of water systems.

    Provides Practical Applications of Finance and Pricing Approaches

    This comprehensive guide to financial and pricing practices delves into a number of factors that have impacted how utility finances its capital program and how it structures rates to recover revenue requirements. Among numerous management challenges, the book addresses such issues as reduced per capita usage and customer demand, a weak economy, social media, balancing community environmental sustainability with financial sufficiency, an increased focus on water demand management and efficiency, and the concern over rate affordability. The author factors in the rate-setting process, implementing a cost-of-service and rate model as key input in each chapter, and also presents a strong financial and rate plan for achieving long-term sustainability.

    What’s New in the Fourth Edition:

    • Presents cutting-edge management approaches and initiatives, and the importance of strong financial management in addressing strategic financial and pricing goals
    • Expands the discussion on traditional financing options, factoring in the current economic climate
    • Explores in detail how to integrate risk considerations into the development of effective financial and rate plans.
    • Includes techniques for projecting demand by retail, wholesale and other customer classes
    • Provides methodologies for the development of water reuse, wholesale, and wheeling rates
    • Contains computer models that include scenario builders, rate dashboards, and graphical presentations of key rate and financing concepts
    • Discusses effective public education approaches to gain stakeholder support of a utility’s financial and rate plan
    • Introduces "triple bottom line" concepts into selecting an appropriate financial and rate plan
    • Expands the concepts of water and wastewater financial planning into the stormwater discipline

    Water and Wastewater Finance and Pricing: The Changing Landscape, Fourth Edition focuses on water and wastewater financial management and pricing, and is geared toward professionals assigned to develop water and wastewater financial plans and rates, senior managers with the responsibility for the long term financial sustainability of the utility, investors evaluating the financial strength of utilities, engineers/consultants planning water and wastewater facilities, academics teaching financial and pricing principles as a part of public policy curriculum, regulators needing to understand the financial viability of utilities under their purview, and policy makers desiring to support effective financial and rate plans for their constituencies.

    Part ONE Overview of Financial Environment and the Role of Utility Management

    Overview of Financial and Pricing Challenges Confronting the Water and Wastewater Industry

    George A Raftelis

    The First Step to Financial Sustainability: Establishing a Strong Utility Management Foundation

    Darin H Thomas, Douglas O Bean, and Thomas E Arn

    Strategic Planning for Water and Wastewater Utilities

    Gerald Wexelbaum

    Part TWO Financing Water and Wastewater Capital Facilities

    Public-Sector Financing Options: Long-Term Financing, Short-Term Financing, and Credit Enhancements

    James M Traudt

    System Development and Other Capital Recovery Charges

    Frank M Davis

    Part THREE Water and Wastewater Pricing

    Water and Wastewater Rate-Setting Process

    Alexis F Warmath

    Projection of Customer Demand

    Marco (Mike) H Rocca and Anthony D Hairston

    Identification of Revenue Requirements

    Joseph F Crea

    Determination of Cost of Service

    Christopher PN Woodcock

    Designing a Water and Wastewater Rate Structure

    Thomas A Beckley

    Conservation and Efficiency Rate Structures

    Sanjay Gaur, Paul L Matthews, and Khanh Phan

    Rate Making for Outside-City Retail and Wholesale Service

    Elaine V Conti and John J Wright

    Recycled Water Rates

    Sudhir D Pardiwala

    Designing an Effective Financial Planning and Pricing Computer Model and Dashboard

    Steve P Vuoso

    Part FOUR Selecting the Appropriate Financial Plan and Rate Approach, and Gaining Stakeholder Commitment

    Selecting the Appropriate Capital Improvement and Financial Plan

    William G Stannard

    Public Outreach and Gaining Stakeholder Commitment

    Peiffer A Brandt, Henrietta HP Locklear, and Catherine J Noyes

    Part FIVE A lternative Delivery Methods and Public–Private Partnerships

    Role of the Private Sector and Alternative Delivery Methods

    Harold J Smith and Gordon L Culp

    Legal and Contractual Considerations Related to Alternative Delivery Methods

    Eric S Petersen

    Part SIX Selected Topics

    Evaluating Risk in Utility Finance, Rate Setting, and Capital Planning

    J Bart Kreps

    Benchmarking Rates and Charges

    Rocky Craley

    Valuation of Water and Wastewater Utility Assets

    Melissa M Levin

    Financial Capability and Affordability

    Jon P Davis and Manuel P Teodoro

    Expanding Financing and Pricing Concepts into Stormwater

    Keith Readling, PE and Henrietta HP Locklear

    Part SEVEN Appendices




    George A. Raftelis, CPA, prior to founding Raftelis Financial Consultants, Inc., was the director of Ernst & Young’s National Environmental Consulting Practice. He has assisted more than 500 water and wastewater utilities worldwide. He received a BS in mathematics with a minor in economics from Eckerd College in St. Petersburg, FL, 1969. He attended the Fuqua School of Business at Duke University and received an MBA with a concentration in finance in 1975. He is the author of The Comprehensive Guide to Water and Wastewater Finance and Pricing, third edition; written technical articles for various periodicals; chaired major committees of water and wastewater industry associations tasked with developing financial and rate best practices; has been a frequent speaker on financial issues in association conferences, and served as coauthor and/or editor of several manuals.

    "This book should be on every water/wastewater utilities bookshelf."
    —Timothy A Houghton, City and County of Honolulu, Department of Environmental Services, Hawaii, USA