Rate Study

Comprehensive Cost of Service Analysis and Rate Study

WSSC’s current rate structure was adopted 25 years ago and good management practice dictates periodic review of rate structure alternatives. A new rate structure is intended to better align costs to produce and deliver safe, clean water with rates, to reflect customer and Commission rate setting policy goals and objectives, and to provide a more predictable revenue stream to pay for infrastructure improvements. Additionally, the Maryland Public Service Commission (PSC) recently ordered WSSC to develop a new rate structure. WSSC’s current rate structure was deemed unreasonable by the PSC because they found it to be preferential to low-usage customers. 

In May 2016, WSSC initiated a comprehensive water and wastewater cost of service analysis and rate study. The study’s goal: to help WSSC establish water and wastewater rate structures that achieve the multiple objectives of revenue stability, equitable cost recovery, and ratepayer affordability.

Cost of Service Study


Current Status

On Wednesday, November 15, 2017, WSSC Commissioners endorsed management’s recommendations and sent three rate structure alternatives to Montgomery and Prince George’s County officials for their review. The recommendation follows a transparent and collaborative public process involving nationally-renowned rate structure experts, an authority on Maryland water conservation and extensive customer outreach.

  • The three recommended rate structures are:
  • 3-tier inclining rate structure alternatives 3A and 3B
  • 4-tier inclining rate structure alternative 4A
Water and Sewer Tiers
Type of Rate Structure Options Gallons Per Day Rate per 1,000 Gallons
3-Tier Inclining Option A 0-80 $10.66
81-165 $13.43
>165 $17.61
3-Tier Inclining Option B 0-165 $10.41
166-275 $13.89
>275 $19.96
4-Tier Inclining Option A 0-80 $10.66
81-165 $12.25
166-275 $14.86
>275 $18.74

 

 

 

 

 

 

 

 

 

 

 

All three rate structure alternatives reflect customer input and Commission rate setting policy goals and objectives. Additionally, these alternatives provide a more predictable revenue stream to pay for infrastructure improvements and better align costs with rates.

Presentation to the Montgomery County Transportation and Environment Committee meeting on February 1, 2018


Timeline for Selection and Implementation

  • Feedback from the counties to the Commissioners is expected by spring 2018.
  • The Commissioners plan to select a new rate structure in June 2018.
  • The implementation of the selected new tiered rate structure, which will change how WSSC bills customers, must wait for a new billing system, expected to be ready in July 2019.

Public Outreach

Throughout the rate structure development process, WSSC engaged in an extensive public outreach campaign to garner input and feedback from residential and non-residential customers, elected officials and other interested stakeholders in both counties. In total, WSSC held or participated in more than 20 public meetings and/or hearings since spring 2017, which were attended by more than 1,200 customers and generated more than 300 total comments on the proposed rate structures. Additionally, all WSSC meetings were livestreamed and seen by nearly 2,500 viewers.

Public Hearing Information
Special Commission Meetings on Rate Structure
Media Coverage 
Timeline
Background/Details 

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