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Mountlake Terrace to reimburse Snohomish County PUD roughly $950,000 to underground utilities on Main Street
Summary
City staff told the council the interlocal agreement with Snohomish County PUD will require the city to cover about $950,000 of utility undergrounding costs on Main Street because state law limits PUD reimbursement; council members asked for clearer exhibits before a July 2 consent vote.
Mountlake Terrace staff told the council on June 11 that an interlocal agreement with the Snohomish County Public Utility District (PUD) will require the city to pay the majority of the cost to move PUD utilities underground on Main Street.
"The overall cost to go from their existing overhead to underground is about 1.5 million," Public Works Director Gary Shimik said. He said state law limits how the PUD calculates reimbursable costs, meaning the PUD can reimburse only an "overhead-to-overhead" baseline (about $500,000 in this segment), leaving the city to fund the remaining difference. "What you see basically in this document is that as part of our project we will be reimbursing them about $950,000 for this effort to go from the existing above ground to below ground," Shimik said.
Shimik said the ILA is project-based and similar to language used for Main Street phase one, and that legal counsel for both the city and the PUD have reviewed costs. He also said the PUD will perform additional "betterment" work that the PUD will pay for separately.
Council members asked for more clarity and for additional exhibits before the ILA is placed on a consent agenda. Staff proposed delaying final council action to July 2 so the PUD can take the matter to its board and the city can add cost exhibits and clarifying language to the draft agreement.
The City Council took no final action on the ILA at the work session; staff said the document will return with more detailed exhibits and board approvals before council consideration.
