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Cascade Water Alliance outlines $1.1–$1.3B supply program and flags near-term rate steps for members
Summary
Cascade Water Alliance told the Redmond City Council it plans a multidecade Cascade Supply Program tied to Tacoma supply access, estimated at $1.1–$1.3 billion, and proposed funding that would add about $0.33 per CCF in 2027 and $0.35 per CCF in 2028 (roughly $0.68/CCF above 2026). Staff said the plan relies on bonds and potential WIFIA assistance and will be updated at design milestones.
Cascade Water Alliance presented a long-term plan on July 21 that would connect Tacoma's water supply to the Alliance's service area and build treatment capacity at Lake Tapps, a program the utility described as spanning decades and multiple phases. John Taylor, Cascade's new chief executive officer, said the project would "guarantee this region long term water security" and provide multiple sources of supply to improve resilience against shocks such as earthquakes.
Cascade economist Andy Baker walked the council through the capital funding plan and the near-term budget implications. Baker said the program is being planned in three phases and that staff ran broad sensitivity analyses to test cost and schedule uncertainty. "This is not an inexpensive project," he told the council, and presented a current planning-level estimate of "somewhere between 1.1 and $1,300,000,000." Baker said the recommended funding strategy includes 9.5 percent rate steps in both 2027 and 2028 and translated that into customer-facing terms: "the proposed rate increase translates to 33¢ per CCF in 2027 more than the current level in 2026. And then in 2028, an additional 35¢ per CCF," for roughly $0.68 per CCF above 2026 levels.
Baker said the primary near-term driver is new debt service associated with bond issuance for the capital program and that the plan builds in triggers for major updates, notably a design milestone around 2029 (10% design/cost update) and construction-bid pricing in 2032. He also identified Water Infrastructure Finance and Innovation Act (WIFIA) loans and other outside funding as important potential sources that would be pursued as the project reaches applicable milestones.
Council members asked how those wholesale changes would be communicated to retail customers and multifamily property owners. Taylor and Baker said Cascade does not communicate directly with individual customers and that member utilities would carry customer outreach; Cascade will provide materials to local utility and customer-service staff. On water quality compatibility, Cascade staff said they have completed a blending study comparing Tacoma and Seattle sources and found the sources compatible, with Tacoma performing better on many constituents in the desktop analysis.
Cascade plans to bring its budget package to the Cascade board in September and to revisit the capital funding plan in the 2028 biennial update. The council did not take action on Cascade's presentation; Cascade staff asked that the city continue to engage with them as the plan and budget proceed through board and regulatory review.
