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    SPU seeks feedback on rate increase plan

    Without service changes, your bill is set to go up nearly 30 percent in the next six years. Weigh in on the rate hikes at public meetings in February and March.

    Storm water drainage, sewage treatment, trash disposal, drinking water delivery. These are the unglamorous underpinnings of any city. And in Seattle they’re about to get more expensive.

    To maintain current service levels, Seattle Public Utilities says that customer rates would need to rise about 4.7 percent annually over the next six years.

    If the utility makes no operations changes, the average bi-monthly household bill would increase from $325 in 2015 to $422 by 2020. That's a jump of about $16 per year, according to a study SPU conducted last year. That study was part of SPU’s effort to develop a “strategic business plan.” Coming up with the plan involves of scrutinizing expenditures, looking for efficiencies and gathering customer feedback. When it's finished, the plan will help guide the utility’s priorities and rates in the coming years.

    During February and early March, SPU will hold a series of public meetings, offering customers a chance to weigh in on the strategic plan, how they’d like to see the utility spend its money and which services they think could be cut back to keep the rate increases lower. SPU’s 2014 budget is roughly $925 million and is funded mostly through revenue from its retail and wholesale customers.

    “My goal is, at the end of the day, we’re going to come in with a number that’s lower than 4.7 percent,” says SPU director Ray Hoffman. “We’re looking at reductions that would not impact the level of services appreciably.”

    The utility charges customers separate rates for water, sewer services and garbage, recycling and yard waste pickup. SPU also charges property owners drainage fees, which pay for maintaining the city's storm water infrastructure. The fees are included as an item on King County property tax bills. The 4.7-percent figure factors in increases across all those individual rates.

    Source: SPU

    A nine-person “customer review panel” began working on the new SPU business plan last April. Panel members include representatives from the Fremont Chamber of Commerce, the Seattle Fairmont Olympic Hotel, Nucor Steel, Seattle Housing Authority, a local real estate firm, an economics professor and a retired civic engineer.

    Inflation tied to operations and maintenance, which includes labor costs, accounts for about 53 percent of the projected rate increases. Other big drivers are a roughly $500 million spend on sewage infrastructure upgrades, yearly payments to King County for wastewater treatment and nearly $180 million to rebuild transfer stations.

    The sewage upgrades are largely the result of a consent decree SPU signed last year with the Environmental Protection Agency and the state Department of Ecology. Under the agreement, SPU has to make the investments in order to reduce sewage and storm water overflows into lakes, creeks and Puget Sound.

    Wastewater treatment bills from the county cost SPU about $130 million annually, according to the utility's most recent Drainage and Wastewater Fund Rate Study. SPU and some of King County’s other wholesale wastewater treatment customers are getting ready to discuss possible changes to their contracts, which could lower costs.

    The payments to King County are "the single largest line item in our wastewater bill,” says SPU's Hoffman. “As their largest customer I think they need to pay attention to what our needs and interests are.”

    When the business plan is completed later this year, SPU will deliver it to the City Council and the Mayor’s Office. The Council and the Mayor approve the city’s utility rates.

    “Nobody likes to see their bills go up,” says Hoffman. “Our first goal is to make sure [customers] can provide us with their perspective on how we should be spending our money.”

    A schedule of the public meetings at which the utility's strategic plan will be discussed can be found on SPU's website. The first meeting is February 5.

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    Posted Wed, Jan 22, 6:09 a.m. Inappropriate

    That proposed annual rate increase of 4.7 percent -- is that compounded annually over the six years? If so, that's an increase of 32 percent over current rates.

    I looked over SPU's website last night and could find nothing discussing any rate increase. Why are they keeping this under wraps?

    Posted Wed, Jan 22, 7:44 a.m. Inappropriate

    Ummm, read the last line of the article that discusses the upcoming SPU public meetings, see the front page article in the Seattle Times today, and see the home page of the SPU website (upper right) where it says "Attend a Workshop on Future Utility Rates".

    Click the link for meeting time and places. Details are in the current strategic plan, which also is posted on the meeting page.


    Posted Wed, Jan 22, 7:49 a.m. Inappropriate

    My bad. The posted strategic plan is through 2014. The rate structure they are working on is for the next plan.


    Posted Wed, Jan 22, 11:56 a.m. Inappropriate

    The future rate structure that SPU doesn't share with Web readers. Their web content is all fluff and no meat.

    I'm glad the news media were able to ferret out the plan for huge rate hikes. Why do agencies like SPU play "hide the ball" with the ratepayers?

    Posted Wed, Jan 22, 7:50 a.m. Inappropriate

    A consent decree between the Feds, the State and the City. We all consent to take more money from the public. On three! Break!


    Posted Wed, Jan 22, 8:16 a.m. Inappropriate

    Perhaps the city should own and manage its own composting facilities. Unless I'm mistaken, We pay Cedar Grove to compost our foodwaste, and we buy it back for our lawns and gardens. We're required to compost, and the city pays a hefty price to have it turned into useable material. This buy back could offset some expenses, if the city owned and operated the facilities.


    Posted Wed, Jan 22, 9:01 a.m. Inappropriate

    Not only do we pay Cedar Grove to DO the composting, we pay them to transport it from our homes to their facilities, plus we provide their business with the raw material. They should be paying US, not us paying them. I'd love to know (but don't have time to investigate) why the city/county/whoever has made this sweet deal for us to provide a private business with its raw materials and pay it/them/whoever to pick it up and transport it to them. Why are we subsidizing them?

    As for the main subject of this article: I don't see what difference public comment will make if anyone even attends these meetings. They'll make their statements spinning why we must pay. We'll say that's ridiculous and we don't want to pay or can't pay, and we'll suggest they reduce both numbers of executives and their compensation. They'll say they can't/won't do either. We'll get doubled utility bills, halved services, and a big hit on our property taxes. I believe this is a foregone conclusion, so I don't see any reason to even attempt to comment at their meetings. Time to move is coming.


    Posted Thu, Jan 23, 2:42 p.m. Inappropriate

    I doubt that there has ever been a time when a city department held a public comment meeting that actually changed what the city was planning on doing anyway.


    Posted Wed, Jan 22, 9:06 a.m. Inappropriate

    4.7% per year sounds high. First off, inflation isn't anywhere near that level (perhaps it will be, but it hasn't).

    Second, out of our existing fees, what percent goes to operation & maintenance versus projects? Is it currently roughly 50%? Why or why not should we allocate a different percentage in the future?

    Third, the existing graph showing rates over the last few years is cherry-picked. There have been a number of steep price increases over the last few years, but I'm willing to bet if you go back 20 years you'll see that as an anomaly.

    In short, to the extent I'm able, I'm willing to pay for increases. But, I need to be convinced that A) the projects are worth the expenditures and B) within reason, the proposed solutions are the most cost effective.


    Posted Wed, Jan 22, 9:54 a.m. Inappropriate

    Dems and public sector unions "collectively bargaining" over the spoils of the public's wallet.


    Posted Wed, Jan 22, 10:15 a.m. Inappropriate

    It is my opinion that SPU is one of the most expensive utilities in the country. Would Crosscut be interested in completing a survey of costs assessed by like utilities in the nation? It is stunning that their rates continue to escalate EVERY year. Is it possible for SPU to review how effectively they use their income each year as opposed to constantly turning over their cost over runs to the captive rate payer?

    Posted Wed, Jan 22, 10:23 a.m. Inappropriate

    Isn't SPU considering cutting trash collections by 50%? Is this part of their plan to "maintain current service levels?" So SPU is telling us that our collection service is going to be cut 50% and prices are going up 32% over the next six years?

    I know it's illegal, but I'm seriously considering using the water in our rain barrels to flush the toilet instead of watering the yard.


    Posted Wed, Jan 22, 12:07 p.m. Inappropriate

    mspat rightfully states that the proposed 'public hearings' probably won't make any difference because the decisions have already been made. None the less, I think it's a mistake for people who oppose or are at least skeptical about these rate hikes to avoid attending and speaking up at these meetings. Far too often the only ones who show up are the organized activists who WANT the programs that result in such tax hikes. It's important to let our local officials know that the cost of living in Seattle is getting way to high, and that actions by the government pushing it even higher will stir up popular resistance.

    Posted Wed, Jan 22, 11:14 p.m. Inappropriate

    Please break out the rates for residential users and commercial users, currently and over the last ten, twenty and thirty years. I believe that commercial users have escaped paying their share of the increase.

    Further, the assumption that the storm water/sewage problem is only solvable by a $500 million (though I have seen figures of $770 million) fix desrves scrutiny.

    I seems to me that too much reportage on this entire subject is simply a rough reprinting of government press releases.

    As I.F.Stone once said (and I paraphrase here): "A press release is only the beginning of the story. The story is finding out what the press release should have said."

    Dick Falkenbury

    Posted Thu, Jan 23, 2:05 p.m. Inappropriate

    SPU has a bloated administrative structure - I'd be curious to know what growth in employment and wages at SPU has been over the past dozen or so years, and compare that to the growth in the city population and average city wages. I'd bet the SPU bureaucracy has grown faster...both in numbers and salary....

    Posted Sat, Jan 25, 8:37 p.m. Inappropriate

    But we have 'free recycling'! Does anyone really believe that all those smashed glass bottles and jars, junk mail, loose cardboard boxes, newspapers, etc. actually get recycled and sold off so as to offset the garbage rates? Audit, please!


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