Developing an Equitable Water Rate Structure

An effective rate structure is essential to a balanced budget. In order to be fair to all customer classes, and to guarantee income to pay for all the costs of service, utilities establish rate structures. By assessing a wide array of factors and identifying which are most important, utility managers can choose or design a rate structure that meets community and utility pricing objectives, furthers city policies, and promotes common philosophies. Monthly water charges and type of rate structure (uniform, declining block, and inverted block) for twenty‐two major US cities are included in this article.