Mil Creek council approves $2.96M CIP increase and short‑term loan to fix citywide catch basins

Mil Creek City Council on April 14 adopted amendments to the 2025–2030 capital improvement plan and approved an interfund loan from the real estate excise tax (REIT) fund to the Surface Water utility to finance a citywide catch‑basin repair program.

Staff told the council they completed 3,350 catch‑basin inspections and identified approximately 1,000 basins that require repair. The low construction bid for the repair program came in about $5.4 million; with contingency and construction management the project estimate is roughly $7 million. The CIP currently carried about $4.04 million for the project, leaving an identified funding gap of $2.96 million.

Finance staff proposed and the council approved a budget amendment to add $2.96 million to the Citywide Catch Basin Repair project (SW00003) and authorized an interfund loan from REIT Fund 314 to Surface Water Fund 401 to finance the work so that construction can proceed this year. Staff said the interfund loan will be an interim financing arrangement limited to a three‑year term under state auditor guidance; the city will pursue longer‑term bonding next year to reduce rate impacts.

Finance staff presented modeled impacts of three financing options: a three‑year interfund loan would raise the equivalent surface‑water fee by roughly $109 (about a 47% increase over current levels) in 2026; a 20‑year bond would add about $23 (≈10%); a 30‑year bond about $19 (≈8%). Staff said the plan is to start with the three‑year loan to enable immediate construction and pursue bonding before the end of the year to spread costs.

Councilors pressed on prevention and maintenance: staff said many repairs resulted from deferred or missed maintenance and that the city will scale preventive maintenance and inspection to reduce future replacements. The council passed the CIP amendment and the interfund loan ordinance (votes recorded on the public record as passing unanimously).

Next steps: award of the construction contract and project scheduling to meet the Department of Ecology and in‑water work windows; staff also plans an RFP for financial advisory services to evaluate bonding alternatives and to minimize long‑term rate impacts.

Ending: The catch‑basin repairs must show measurable progress toward correction by the Department of Ecology deadlines (staff cited an in‑water work window and an October 1, 2028 completion requirement for remaining repairs).