City of Madison - File #: 67459

• File #: 67459
• Version: 1
• Name: Authorizing the General Manager to file, on behalf of the Utility, a conventional rate case with the PSCW for the test year 2022 that includes accelerated depreciation of water mains (expense depreciation) and a means tested Customer Assistance Program (C
• Type: Resolution
• Status: Passed
• File created: 9/15/2021
• In control: Water Utility
• On agenda: 10/5/2021
• Final action: 10/5/2021
• Enactment date: 10/12/2021
• Enactment #: RES-21-00692
• Title: Authorizing the General Manager to file, on behalf of the Utility, a conventional rate case with the PSCW for the test year 2022 that includes accelerated depreciation of water mains (expense depreciation) and a means tested Customer Assistance Program (CAP).
• Sponsors: Nasra Wehelie

Date	Ver.	Action By	Action	Result
10/5/2021	1	COMMON COUNCIL	Adopt	Pass
9/28/2021	1	WATER UTILITY BOARD	RECOMMEND TO COUNCIL TO ADOPT - REPORT OF OFFICER	Pass
9/27/2021	1	FINANCE COMMITTEE	Return to Lead with the Recommendation for Approval	Pass
9/22/2021	1	WATER UTILITY BOARD	Refer
9/21/2021	1	COMMON COUNCIL	Refer	Pass
9/15/2021	1	Water Utility	Referred for Introduction

Fiscal Note
The proposed resolution authorizes the General Manager of Madison Water Utility (the Utility) to file for a conventional rate case with the Public Service Commission of Wisconsin (PSCW) for test year 2022; no fiscal impacts for FY 2021.

Title
Authorizing the General Manager to file, on behalf of the Utility, a conventional rate case with the PSCW for the test year 2022 that includes accelerated depreciation of water mains (expense depreciation) and a means tested Customer Assistance Program (CAP).

Body
WHEREAS, the Utility’s current rates are not adequate to support its long-term Capital Improvement Program (CIP), specifically the water main replacement program; and

WHEREAS, the Utility is committed to maintaining at least the current level of funding for the water main replacement program; and

WHEREAS, the Utility has an outstanding total debt obligation of $245M as of August 31, 2021 and an annual debt service payment of $18.3M for 2021, which is higher than the Utility’s current Operations and Maintenance Expenditures and hence desires to limit further borrowing; and

WHEREAS, the PSCW will generally allow 1.3% depreciation on water mains which amounts to $1.8M of annual depreciation for the Utility; and

WHEREAS, the Utility can strengthen its short and long-term financial position by seeking PSCW approval to generate an additional $5M of depreciation in ‘Expense Depreciation’ to invest in the water main replacement program; and

WHEREAS, the Utility desires to provide financial relief to its eligible customers by implementing a means tested CAP to fulfill its commitment to make drinking water accessible and affordable for all customers; and

WHEREAS, the Utility will use the Federal Department of Housing & Urban Development (FDHUD) income standards for Madison to determine eligibility for the CAP; and

WHEREAS, the Utility anticipates an estimated annual cost of approximately $650,000 to fund the CAP; and

WHEREAS, the implementation ...