Sequim staff preview 2026 budget and propose new utility rates, third‑tier water charge to encourage conservation

City staff presented an initial overview of the proposed 2026 budget and an accompanying update to the city’s rates and fees during the Sept. 22 council meeting.

City Manager and Finance Director Sue Hegener described the materials distributed to council — the manager’s budget message, ordinance, and a digital budget book available Sept. 12 — and encouraged councilors to submit questions in October. Hegener said staff would schedule one‑on‑one meetings with council members who request deeper department briefings ahead of required public hearings on rates, fees and the property tax levy.

Hegener noted an automated review built into the city’s budget software that compares the document to Government Finance Officers Association best practices. “On the first pass we got a 98.1% score,” she said.

Finance staff also presented a comprehensive update to Chapter 3.68 (fees and charges). Sue Hegener and Finance Director (presentation lead) said the review cleaned duplicative language, clarified fee descriptions, incorporated a previously approved five‑year schedule of water and sewer rate increases, and applied a 3% inflationary factor to general facility charges (GFCs).

Significant utility changes include the addition of a third consumption tier for large water users. Staff said the third tier had already been applied to multifamily and single‑family customers but had not previously reached the largest commercial users; the higher third tier will now apply to excessive consumption by large users to encourage conservation and more fairly distribute utility costs. The package also removes duplicated rate language across customer classes.

Staff urged councilors to submit questions in October so department directors can provide detailed answers; the council set deadlines tied to county property tax timelines and intends to hold public hearings on rates, fees and the final budget in November.