Tumwater rate study: large capital program could require a one‑time spike in 2027

Tumwater’s Public Works Committee heard a presentation Thursday, Feb. 6, 2025, from Corolla Engineers showing that funding nearly $80 million in planned water system capital projects through 2035 could require a substantial single‑year rate increase under some scenarios — a 31.2% jump in 2027 in one modeled case — unless the city spreads costs using debt or other smoothing strategies.

The study, presented by Isla Barnes of Corolla Engineers and introduced by Patrick Soderberg, Tumwater’s water and resource and sustainability program manager, lays out the model assumptions, revenue requirements, affordability benchmarks and an impact‑fee update and provides a scenario tool staff can use in annual financial planning.

Why it matters: Tumwater faces large, growth‑driven projects (the presentation lists a Southeast reservoir and system extension near $25 million among about $80 million in identified capital over an 11‑year planning horizon). The study’s scenarios show that timing and method of funding those projects — pay‑as‑you‑go from rate revenue, issuing debt, or a mix — materially change near‑term rate needs and reserve balances and will affect affordability for lower‑income households.

Barnes told the committee the model follows American Water Works Association guidance…