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In response to challenges to contractually determined wholesale rates, rising revenue requirements, and demands for rate equity, the Austin (Texas) Water and Wastewater Utility is scheduled to implement wholesale cost-based rates in November 1992. Rate alternatives derived from a comprehensive cost-of-service analysis will reflect hourly water demand data currently being collected for the utility's major customer classes. Water demand monitoring sites ensure statistical representation of customer class demands, and the three types of monitoring equipment were selected to minimize data collection costs, to provide sufficient data resolution, and to allow direct transfer of data to a relational data base. Preliminary results are encouraging. Includes reference, tables, figures.