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<br />BARTLE WELLS ASSOCIATES 4 | Pag e <br /> City of San Leandro Draft 2024 Wastewater Rate Study <br />2.2 Rate-Study Process <br />The general process used for this cost-of-service rate study is summarized in the following diagram. <br /> <br />Figure 1 – Cost-of-Service Rate Study Process <br /> <br /> <br />Key elements of the study include: <br />1) Project Initiation and Data Collection – Review financial policies; collect financial and other relevant data; <br />and review rate structures; <br />2) Demand Analysis – Analyze past customer demands and customer characteristics to forecast future demands; <br />3) Financial Plans – Develop financial projections to evaluate annual revenue requirements from rates and the <br />overall level of rate increases needed to fund the costs of providing service and support long-term financial <br />stability; <br />4) Cost Allocation – Group the City’s costs in terms of the function they serve as a basis to proportionally allocate <br />the revenue requirement from rates; <br />5) Cost-of-Service Rate Design – Develop rates that proportionately recover costs; and <br />6) Prop 218 Process – Ensure compliance with the substantive and procedural requirements of Proposition 218. <br /> <br />2.3 Constitutional Requirements for Rates <br />The wastewater rates proposed in this report are designed to comply with two key articles of the California <br />Constitution: Article 13D and Article 10, as explained below. <br /> <br />2.3.1 Article 13D, Section 6 <br />Proposition 218 was adopted by California voters in 1996 and added Articles 13C and 13D to the California <br />Constitution. Article 13D, Section 6 governs property-related charges, which the California Supreme Court has <br />Project <br />Initiation <br />and Data <br />Collection <br />Demand <br />Analysis <br />Financial <br />Plan <br />Cost <br />Allocation <br />Rate <br />Design <br />Prop. 218 <br />Process