Water rate increases planned
By John Larson
Tacoma Weeklyjlarson@tacomaweekly.com
Published on: November 20, 2008
Tacoma residents can count on their water bills going up $2.14 per month in 2009. A typical commercial customer inside the city limit can expect an increase of $21.97. Meanwhile railroads served by Tacoma Rail can expect rate increases. Rising fuel and labor costs, regulatory obligations and needed infrastructure upgrades are impacting all three divisions of Tacoma Public Utilities (TPU). Tacoma City Council examined the proposed TPU budget for 2009-10 during a budget workshop Nov. 18.
Because of increased fuel costs and a downturn in cargo volume through Port of Tacoma, Tacoma Rail plans to raise its intermodal rates 13.3 percent and commercial rates 14.2 percent. The main impact will be on its two major customers, Burlington Northern and Union Pacific. The two railroads provide Tacoma Rail with 75 percent of its customers.
Dan McCabe, section manager for finance for Tacoma Rail, told the council the railroads are aware of the planned increases and understand the reasons, noting they have raised their own rates for their customers considerably since 2006.
Tacoma Rail has 98 employees, and budgeted for 111 in the next biennium. “We will not fill those positions if we do not have the volumes to support them,” McCabe said.
Tacoma Water plans to raise its rates by 8 percent next January and another 10 percent in January 2010.
Labor costs are expected to increase by $5.4 million in the next biennium.
Replacing the aging McMillin Reservoir will cost $55 million. Upgrades to distribution infrastructure will cost another $31 million.
The microorganism crypto spiridium in the water supply caused a severe disease outbreak in Milwaukee some years ago. As a result, the federal government is requiring water systems to prepare to prevent it from entering their supplies. Tacoma Water Superintendent John Kirner said using ultraviolet light would cost less than filtration, although there is a possibility they would be required to use both.
Mayor Bill Baarsma noted that the Milwaukee outbreak was caused by cattle grazing in the watershed that supplies that city. The Green River watershed that supplies Tacoma, in contrast, has a few deer, rather than thousands of cattle. Baarsma said the chance of an outbreak here is highly unlikely, but Kirner noted Tacoma Water has to follow the federal mandate.
Tacoma Water is doing what it can to limit the size of the rate increase, Kirner told the council. It will save about $300,000 in the next biennium by reducing the parts per million of fluoride it adds to water supplies. It is cutting back on painting exposed transmission lines.
“We are scraping pretty hard to get these savings,” he remarked.
Tacoma Water is anticipating a rate increase of 13 percent in 2011. A lesser rate increase now would simply result in higher ones in the future, Kirner said. “If we do not increase the rates this time, it will result in having to raise the rates even higher next time.”
Tacoma Power Superintendent Gary Armfield discussed the situation with his division of TPU. It anticipates having to add staff to address current shortages. But just because it has identified the shortages does not mean all the positions will be filled in the next biennium, he said. The level of activity in the port will factor in this. “The staffing decisions will be made on actual need,” Armfield said.
The TPU board passed the budget at its Oct. 22 meeting. It needs the final approval of the council, which will vote on it Dec. 2.
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