Anacortes council approves $4.5 million interfund loan to accelerate CSO pump station work

The Anacortes City Council on Oct. 13 approved Ordinance 5006, authorizing an interfund loan of $4,500,000 from the water fund to the wastewater fund to start the combined sewer overflow (CSO) pump station project.

The loan, structured as a five-year simple-interest repayment at the five‑year Treasury rate of 3.61%, will provide cash liquidity so construction can begin on a pump station staff say is 100% designed and bid-ready. Public works staff said the pump station will reduce the risk of sanitary sewer overflows by increasing the system’s ability to empty the large trunk line that runs down R Avenue and relieve surcharging manholes near the Safeway area.

“Adding the CSO pump station will allow us to drain the trunk line faster so there’s capacity in the R Avenue pipe and we won’t have sewage coming out of manholes during heavy rain,” Public Works Director Andy Rayam told council. Rayam said the existing trunk line becomes surcharged during intense storms, producing manhole overflows at locations in the system; the pump station will intercept flow at a weir, pump it through the new outfall and send it to the treatment plant instead of allowing an overflow to the surface.

Rayam said the design is complete and that a delay would require refreshing the plans, which he estimated could cost $250,000 to $500,000. He also noted that typical CSO abatement grants target projects that eliminate CSOs, not projects that improve system function, and that pursuing grants would likely add about 18 months before work could begin.

Council members asked staff whether the city had any history of permitted overflows and how much of the city remains on combined sewer. Rayam said the permit currently allows one combined sewer overflow event per year and estimated that most rooftops remain connected to the combined system while roads now mostly have separate storm sewers. He said he could not provide a precise percentage of combined versus separated area without further analysis.

Councilmember Moulton moved to adopt Ordinance 5006; Councilmember Walters seconded. The motion passed with a unanimous roll-call vote.

City staff said the loan would be repaid from the sewer fund over five years and that preliminary budget work shows an approximate $5-per-month sewer rate increase would cover the annual loan payment; the council noted that a formal rate decision would come during the 2026 budget process.

Rayam and other staff emphasized operational and regulatory risks of delay, telling council the city has observed the modeled surcharge locations in the field and that relieving the trunk hydraulics now is the most effective approach to avoid future sanitary sewer overflows.

Votes at a glance: Ordinance 5006 — interfund loan of $4,500,000 from the water fund to the wastewater fund — approved.