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ATTACHMENT 1 TO <br /> AMENDMENT ONE TO <br /> AGREEMENT TO PROVIDE RECYCLED <br /> WATER TREATMENT AND DELIVERY SERVICES <br /> Attachment 1 is a sample calculation of how replacement expenditures under Sections 1.4.2 and <br /> 2.2.1 are incorporated into the actual year end rate calculation. <br /> Background: At the beginning of each budget year, DERWA sets a provisional rate for the year <br /> based upon the adopted budget. At the end of each budget year, DERWA calculates the actual <br /> rate based upon actual expenditures during the year. This example shows how replacement costs <br /> of less than $100,000 are incorporated into the actual year end rate calculation. <br /> Example Section 1.4.2 Pipeline AB: <br /> Replacement cost = $60,000 <br /> Total recycled water delivered by DERWA during budget year: <br /> e DSRSD = 2,600 AFY <br /> e EBMUD = 2,100 AFY <br /> o Pleasanton = 1,500 AFY (excluding Val Vista Park) <br /> o Total = 6,200AFY <br /> Unit rate of replacement cost: <br /> e $60,000/6,200 AF = $9.68/AF <br /> Actual operating costs are used to calculate year end rate and $9.68/AF would be added to <br /> DSRSD, EBMUD and Pleasanton rates to get the final rate for the year. (Note: final total rates <br /> would not be the same as the Pleasanton rate is based upon only treatment costs plus a <br /> percentage of DERWA overhead. However the replacement add on would be the same for all 3 <br /> entities.) <br /> Example Section 2.2.1 Val Vista Park Service: <br /> Replacement cost= $25,000 <br /> Total recycled water delivered by DERWA during budget year <br /> G Pleasanton= 1,800 AFY (including Val Vista Park) <br /> Unit rate of replacement cost: <br /> e $25,000 / 1,800 AFY = $13.89/AF <br /> Actual treatment operating costs are used to calculate Pleasanton year end rate and $13.89/AF <br /> would be added only to Pleasanton rate to get the final Pleasanton rate for the year. <br /> Page 7 of 7 <br />