This paper considers the optimization of public infrastructure systems, recognizing that these systems serve multiple user classes. Under the guidance of a policy-making body, the analyst chooses both the system design, including its layout and control, and the prices to be charged for the service. The goal of the optimization is to maximize society's welfare recognizing that the system's performance will in general depend on the system's demand, and vice versa. The optimization problem is first formulated in its full complexity. Under defined circumstances, the problem decomposes into...