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Staff is recommending option B on the basis that if any reduction in inflows can be <br />achieved the future losses will be mitigate without further dramatic increases. Inflow <br />reduction is our best opportunity to control rates. Even after the steps we have already <br />taken(line repairs, sealing of manholes, and the sump pump program), inflow continues <br />to be a problem. Staff believes the next step is to determine the source of inflow (roof <br />drains, bad mains, bad services, etc.) and then take steps to eliminate it. If we can not <br />reduce inflows, more dramatic rate increases will be necessary in the future. <br />If you have any questions please feel free to contact either of us. <br />F.AShcilyRAI3ud <br />2004 \FINAL MEMO RE. WS 12A'rES.doc <br />