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Committee advances 2027–2029 water-rate ordinance with technical amendment and RSF withdrawal authorization
Summary
The committee unanimously recommended passage of Council Bill 121245 (2027–2029 water rates). Members adopted a technical amendment to remove duplicate municipal-code changes and the bill authorizes the SPU general manager to withdraw up to $19.8 million from the Revenue Stabilization Subfund if the balance remains above $17.1 million; staff said the RSF currently holds about $38 million.
The Governance and Utilities Committee on July 29 advanced Council Bill 121245, the ordinance establishing retail water rates for 2027 through 2029, adopting a staff-sponsored technical amendment and forwarding the bill to the full council.
Council central staff summarized that the ordinance would set a 4.3% rate increase in each year of the 2027–2029 rate period, revise Utility Discount Program eligibility consistent with recent council action, and authorize potential withdrawals from the water fund Revenue Stabilization Subfund (RSF) of up to $19,800,000 provided the RSF balance remains above $17,100,000. "Section 5 of the bill authorizes the general manager and chief executive officer of SPU to make 1 or more withdrawals from the RSF up to a cumulative maximum of $19,800,000," a staff presenter said; staff added the current RSF balance is about $38,000,000.
SPU rates and financial-planning manager Maria Ko presented regional comparisons and said Seattle's typical average monthly bill for single-family residents is $50.71. Staff explained the rate package uses "rate smoothing" to reduce volatility across the three-year period and proposes shifting toward a larger share of fixed revenue (higher base service charges) to increase month-to-month predictability.
Council members asked for historical context on reserve policies, the consequences of shifting annual hydrant inspections from the Fire Department to SPU (a possible $273,000 annual assumption in the rate study), and how rate decisions interact with bond ratings. Staff said the financial policies were last updated in 2005 and that SPU is treating about $17.1 million as a practical minimum to protect bond ratings.
The committee adopted amendment 1 (technical cleanup removing duplicative UDP code language and adding the RSF authorization to the title) by roll call and then passed the bill as amended (roll call 5–0). The committee will forward its recommendation to the Aug. 4 City Council meeting for final action.
