Water rates likely to go up annually for several years

December 29, 2012

By Caleb Heeringa

New: Dec. 29, 11:14 a.m.

Sammamish Plateau Water and Sewer District is trimming its staff by three and a half positions. But customers are still likely to see annual rate increases of up to 5 percent for water and 17 percent for sewer in the coming years as the district puts money away for future replacement of its infrastructure and pays off debt from old projects.

The district’s board of commissioners unanimously approved the agency’s $25.1 million budget for 2013 at a Dec. 3 meeting. The budget calls for three full time positions to be cut, including a finance analyst, an engineer and a planner. An executive assistant position will also switch from full-time to half-time. The district also recently froze the salaries of several top managers after a market analysis showed them to be 12 percent to 17 percent higher than average compared to neighboring water districts and cities. These measures will save the district approximately $330,000 in personnel costs.

But with labor costs only making up about 21.5 percent of the district’s budget, those savings only make a dent in overall costs. The district plans to increase its contribution to its’ capital replacement fund by $458,000 – from approximately $3.11 million per year to $3.56 million, bringing the fund’s total up to $13.36 million by the end of 2013. The fund reflects the commission’s policy choice to save now for the eventual replacement of pipes and other infrastructure, rather than hit customers with a large bill when those pipes fail.

The district is also dealing with a proposed assumption of some of its service area by the city of Issaquah. Earlier this year Issaquah commissioned a study on the impact of providing water service to neighborhoods in its city limits that are currently served by the district. The results are expected early next year. The district and city of Issaquah have sent each other dueling public disclosure requests in recent months, something the budget notes has been a “drag on staff time.” With the assumption in mind, the district’s budget calls for an additional $350,000 to be budgeted for legal help above and beyond the $150,000 a year the district pays its normal attorney, John Milne. In September, the board also approved spending up to $50,000 on a public relations consultant.

The district also continues to grapple with the fact that the revenues it collects from new development, and new connections to its system, don’t measure up to the debt payments it incurred to pay for past projects, much less the capital investments it expects to have to make in the coming years. The district brought in $392,320 in revenue for sewer facilities from connection fees in 2012. In 2013, it expects to pay $430,000 on debt for similar projects it finished in recent years and has $995,960 in sewer projects earmarked to begin in 2013.

Commissioner Lloyd Warren said he was hopeful that an updated sewer comprehensive plan process, due next year, would help address that shortfall. He said he wanted the district to be careful not to assume all of the capital projects on its five-year plan would end up being built when adjusting the district’s rates for sewer and water.

“I don’t think we should plug every single capital project into the rate model – not every one is going to be built,” Warren said.

The district has seen annual rate increase between 7 percent and 13 percent every year since 2009. It made a fundamental change to its rate structure earlier in 2012, opting for a higher base charge but charging customers less per cubic foot of water. Comm-issioners were hopeful that it would help stabilize the district’s revenue stream, which tended to fluctuate significantly depending on how much water residents were using – something that varies depending on the weather. The district is withholding judgment on whether the new rate structure worked, since it only went into effect in the middle of last year.

The rate change also reflected the district’s continued desire to separate the sewer and water sides of its business model, which had been intermingled in years past. The district’s water only customers have typically seen their rate payments subsidizing the district’s water and sewer customers.

Despite the personnel cuts, district customers will likely see rate increases next year and in the years beyond because of the continued disparity between sewer revenues and sewer expenses and an increasing amount of revenue being squirrelled away for future replacement projects. A rate forecast provided at the Dec. 3 meeting calls for water rate increases of around 5 percent a year and sewer rate increases of around 17 percent a year for the foreseeable future. Those rises would be closer to 6 percent and 18 percent, respectively, if the district hadn’t eliminated positions in the 2013 budget.

Rate adjustments are expected to occur in the spring.

Bookmark and Share
Other Stories of Interest: ,

Comments

5 Responses to “Water rates likely to go up annually for several years”

  1. Carmina Flores on January 4th, 2013 10:37 pm

    Is anyother resident in Sammamish upset about this rate hike? And they state this will go on for several years? I can’t help but notice they are budgeting for more legal help and a PR consultant in the coming 2013 budget. Oh, by the way the link to view the budget on their website does not work.

  2. Janet Sailer on January 8th, 2013 3:14 pm

    Carmina, here is a direct link to the budget on our website:

    http://www.sammplat.wa.org/DistrictBudget.pdf

    Our Information Services Manager said that customers who use Google Chrome or Mozilla Firefox as their browsers sometimes have problems accessing the information on our website. He recommended trying to access our website using Internet Explorer. Please give that a try and let me know if that works. If not, please call me at (425) 392-6256 x 204 and I will make sure you get a copy of the budget. We apologize for the inconvenience!

    Janet Sailer
    Planning and Outreach Coordinator

  3. Janet Sailer on January 9th, 2013 10:08 am

    We have heard from customers who have been having difficulty accessing our District budget document on our website. Our Internet Services Department offers this information to help you to access the file:

    Customers using Google Chrome and Mozilla Firefox may have trouble viewing our files. Our IS Department recommends searching using Internet Explorer. Please go to the following links for more information: http://support.mozilla.org/en-US/questions/775819 and https://support.mozilla.org/en-US/kb/pdf-files-are-blank-and-cant-be-downloaded-mac

    Customers using Apple products such as Macintosh computers or iPads also appear to be having problems. See the above links for more information.

    As an alternate, you can right-click the link in Internet Explorer and select “Save target as” (in Google Chrome click “save link as”). The file that displays will be “DistrictBudget.pdf.”

    Adobe Reader must be installed on your computer to view the file.

    The District’s budget document is a very large file (9MB) so it may take some time to download. If customers are attempting to access the document with a slow connection, it may time out.

    If at any time you cannot access our files, please call Janet Sailer at (425) 392-6256 x 204 and I will be sure to email or mail a hard copy of the budget to you. We apologize for any inconveniences customers may have accessing our files. Thank you for your patience!

  4. Janet Sailer on January 9th, 2013 2:15 pm

    Correction to my previous post: Customers using Apple iOS and Mozilla Firefox may have trouble viewing our files. This is a known issue when trying to access PDF files within the Mozilla browser. Please go to the following links for more information: http://support.mozilla.org/en-US/questions/775819 and https://support.mozilla.org/en-US/kb/pdf-files-are-blank-and-cant-be-downloaded-mac

  5. Ian on January 23rd, 2013 9:30 pm

    Actually you should watch your recent water bill carefully: the water/sewer district overcharged the metro charge part. Their explanation: any invoice/bill coming after 01/01/2013 will use the new King County metro charge amount of about $39, even for your Nov/Dec of 2012 usage. This is totally bonus and wrong: I checked with King county and was told what they charged on the district was still about $36. So the district would do this quietly and for as many as 10,000 customers, what they got would be close to $70,000, what a steal!

Got something to say?

Before you comment, please note:

  • These comments are moderated.
  • Comments should be relevant to the topic at hand and contribute to its discussion.
  • Personal attacks and/or excessive profanity will not be tolerated and such comments will not be approved.
  • This is not your personal chat room or forum, so please stay on topic.