sec.41Full cost recovery for water and sewerage services

### sec.41 Full cost recovery for water and sewerage services A local government conducting a relevant business activity must— conduct a 2-part charge assessment for the providing of water services; and decide whether a 2-part charge is to be applied for water services; and if a 2-part charge is to be applied for water services—apply the charge in accordance with the decision; and apply full cost recovery for water and sewerage services; and identify and disclose cross-subsidies and community service obligations in the providing of water and sewerage services; and disclose a class of consumers who are provided with water and sewerage services at an amount below full cost and the amount. A local government applies full cost recovery for a service if the estimated total revenue for the financial year is more than the estimated total costs of providing the service in the financial year. A 2-part charge assessment is an assessment of the cost effectiveness of the application of a 2-part charge for a business activity that is the provision of water services. A 2-part charge is a utility charge that is made up of the following 2 parts— a fixed charge for using the infrastructure that supplies water to a person (a consumer ) who is liable to pay the charge; a variable charge for using the water, based on the amount of water that is actually used by the consumer. The total revenue includes revenue from performing community service obligations, less the cost of performing the obligations. The total costs , of providing a service, include— the operational costs of providing the service; and a reasonable allocation of the administrative and overhead costs of conducting the local government’s business activities to which this section applies; and the cost of resources used in providing the service, based on— if the resources have an identifiable cost—that cost; or otherwise—the price at which the resources can be obtained on the open market on similar terms; and depreciation of each asset used in providing the service, based on— the depreciable amount for the asset, allocated over its useful life; or an amount the local government decides is appropriate in the circumstances; and the return on the capital used in providing the service, based on a positive rate the local government decides. The capital used in providing the service is the total value of the assets used for the service (using an accepted accounting method), less the liabilities attributable to the service. (sec.41-ssec.1) A local government conducting a relevant business activity must— conduct a 2-part charge assessment for the providing of water services; and decide whether a 2-part charge is to be applied for water services; and if a 2-part charge is to be applied for water services—apply the charge in accordance with the decision; and apply full cost recovery for water and sewerage services; and identify and disclose cross-subsidies and community service obligations in the providing of water and sewerage services; and disclose a class of consumers who are provided with water and sewerage services at an amount below full cost and the amount. (sec.41-ssec.2) A local government applies full cost recovery for a service if the estimated total revenue for the financial year is more than the estimated total costs of providing the service in the financial year. (sec.41-ssec.3) A 2-part charge assessment is an assessment of the cost effectiveness of the application of a 2-part charge for a business activity that is the provision of water services. (sec.41-ssec.4) A 2-part charge is a utility charge that is made up of the following 2 parts— a fixed charge for using the infrastructure that supplies water to a person (a consumer ) who is liable to pay the charge; a variable charge for using the water, based on the amount of water that is actually used by the consumer. (sec.41-ssec.5) The total revenue includes revenue from performing community service obligations, less the cost of performing the obligations. (sec.41-ssec.6) The total costs , of providing a service, include— the operational costs of providing the service; and a reasonable allocation of the administrative and overhead costs of conducting the local government’s business activities to which this section applies; and the cost of resources used in providing the service, based on— if the resources have an identifiable cost—that cost; or otherwise—the price at which the resources can be obtained on the open market on similar terms; and depreciation of each asset used in providing the service, based on— the depreciable amount for the asset, allocated over its useful life; or an amount the local government decides is appropriate in the circumstances; and the return on the capital used in providing the service, based on a positive rate the local government decides. (sec.41-ssec.7) The capital used in providing the service is the total value of the assets used for the service (using an accepted accounting method), less the liabilities attributable to the service. - (a) conduct a 2-part charge assessment for the providing of water services; and - (b) decide whether a 2-part charge is to be applied for water services; and - (c) if a 2-part charge is to be applied for water services—apply the charge in accordance with the decision; and - (d) apply full cost recovery for water and sewerage services; and - (e) identify and disclose cross-subsidies and community service obligations in the providing of water and sewerage services; and - (f) disclose a class of consumers who are provided with water and sewerage services at an amount below full cost and the amount. - (a) a fixed charge for using the infrastructure that supplies water to a person (a consumer ) who is liable to pay the charge; - (b) a variable charge for using the water, based on the amount of water that is actually used by the consumer. - (a) the operational costs of providing the service; and - (b) a reasonable allocation of the administrative and overhead costs of conducting the local government’s business activities to which this section applies; and - (c) the cost of resources used in providing the service, based on— (i) if the resources have an identifiable cost—that cost; or (ii) otherwise—the price at which the resources can be obtained on the open market on similar terms; and - (i) if the resources have an identifiable cost—that cost; or - (ii) otherwise—the price at which the resources can be obtained on the open market on similar terms; and - (d) depreciation of each asset used in providing the service, based on— (i) the depreciable amount for the asset, allocated over its useful life; or (ii) an amount the local government decides is appropriate in the circumstances; and - (i) the depreciable amount for the asset, allocated over its useful life; or - (ii) an amount the local government decides is appropriate in the circumstances; and - (e) the return on the capital used in providing the service, based on a positive rate the local government decides. - (i) if the resources have an identifiable cost—that cost; or - (ii) otherwise—the price at which the resources can be obtained on the open market on similar terms; and - (i) the depreciable amount for the asset, allocated over its useful life; or - (ii) an amount the local government decides is appropriate in the circumstances; and