Snoqualmie staff propose ‘maximum‑debt’ CIP scenario; committee asks for rate design next meeting

City staff and advisors presented the utility capital improvement program (CIP) and utility rate study to the Public Works Committee, laying out project priorities across water, wastewater and stormwater and offering three scenarios for rate design. The committee directed staff to develop a rate design based on a staff‑recommended “maximum‑debt” scenario that would borrow more now to smooth near‑term rate spikes.

Dylan (project manager/presenter) walked the committee through the CIP spreadsheet and an 11x17 summary sheet that color‑coded projects by utility and criticality. Dylan described three scenarios: an “ordinance” scenario embedded in the prior rate ordinance, a “coverage” scenario focused on debt‑coverage ratios, and a “maximum‑debt” scenario that delays or reduces some capital projects, increases debt borrowing in the near term and smooths the rate increases expected in 2025.

The presentation covered multiple water projects that staff said drive much of the near‑term rate pressure: pressure‑zone conversions and pressure‑reducing‑valve (PRV) work to improve fire flow in the downtown “599” zone; a PRV‑stations study to optimize pressure regulation; additional booster pumps in the 705 and 1040 zones to improve supply to the ridge; and a 1040 reservoir addition tied to future development and a possible mill‑site project.

Staff discussed the South Well Field and an aquifer storage and recovery (ASR) pilot. Jeff (water staff) and Dylan said the South Well Field is a backup supply with taste and odor issues; an ASR pilot (pilot testing scheduled to begin in spring) would pump wintertime surplus from Canyon Springs into the aquifer to improve drought resilience and could reduce the need for more costly South Well Field upgrades if the pilot succeeds. Staff said they expect to know whether ASR will be viable by late 2025 and noted that if ASR succeeds the city would likely avoid larger South Well Field construction.

Canyon Springs also drew attention: staff described an aging chlorine generator that is undersized for the volume needed if ASR proceeds, and long‑term erosion and slope instability that threaten access to primary spring infrastructure. Staff said the city performs twice‑yearly geologic assessments at that site and recommended an equipment upgrade and later stabilization work.

Staff emphasized that the sewer CIP is the largest driver of rate increases. Dylan proposed several specific adjustments: delay or bundle river‑crossing projects into a later feasibility package tied to the state’s SR‑202 work; reduce the scope of a large 3rd/4th Street sewer project where engineering has overestimated costs; and maximize bonding across utilities to spread costs over more years. Committee members asked for packaged options and for the staff recommendation to be shown alongside alternatives. Several members expressed support for the “maximum‑debt” approach as the most promising path to reduce the 2025 peak rate increase, while acknowledging tradeoffs and the need to avoid risky deferments that could increase costs later.

The committee asked staff to prepare a rate design for the “maximum‑debt” scenario for the next Public Works Committee meeting and then to present the ordinance and rate design to full council. Staff outlined a timeline that would return to committees with a proposed rate design, proceed to council for ordinance readings and adopt rates in time for the next budget cycle. No formal council vote on rates occurred at this meeting; the committee’s action was a direction to staff to prepare and return with the requested materials.