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Financing for Environmental Compliance

Planning Process Step Five: Conduct a Rate Analysis

The cost to provide service changes over time. A rate analysis should be conducted periodically to ensure that rates cover the full cost of providing a service. The rate analysis should determine whether the current rate structure is covering current costs and whether the rate will need to be changed to meet future costs.

Some state agencies have published state-specific rate studies. Please contact your state environmental quality agency to obtain available state air, waste and water rate information.


The 2004 American Water Works Association Water and Wastewater Survey states that the average monthly wastewater rates for the average customer1 are: 

Setting Small Drinking Water System Rates for a Sustainable Future (PDF) (62 pp, 341K, About PDF)
EPA created this rate setting guide to help small drinking water systems bring in enough money to cover the full costs of doing business now and in the future. This guide is designed to help owners, operators, and managers of community water systems (CWSs) serving 3,300 or fewer persons understand the full costs of providing a safe and adequate supply of drinking water to their customers and how to set water rates that reflect those costs.


A broader discussion of full-cost accounting in a municipal solid waste context can be found at http://www.epa.gov/epaoswer/non-hw/muncpl/fullcost/questions.htm

1(1,000 cf/ 7,480 gallons)

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