City Council - Special Meeting

Thank you.

I'll make a motion to approve the agenda.

A motion and a second. All those in favor, please say aye. Aye. Any opposed? Mayor, you have an agenda.

All right. Wonderful. Item number five. Clerk, do we have any comments online or in person?

I don't have anybody online. Okay. No, no comments.

Wow. Okie doke. We're on to item number six. I do not see any place for the mayor's comments. So I'm going to just speak real quick before we jump into number six. Thank you council members for going back to Washington DC in March. Those legislative efforts are important because since then, city staff has been able to work with our congressional delegation. And I'm smiling tonight because the Senate and the House came to a continuing resolution that is waiting for the president to sign. And that extends our two and a half million dollar grant for another year. So hard work on all of our part. And it starts with council support. So thank you. Thank you. Thank you very much. All right, tonight, action item number six is to approve a hiring of a temporary financial analyst. I do want to comment on why we are canceling our, because this directly ties into why we're canceling our retreat and pivoting. The need to be nimble, we just weren't ready. We're in the position where we need to rebuild our finance department. No surprise, new director, there's a need for that. In an effort to be transparent and to be able to show our work, just as important to be able to show council our work and then to have accurate information. Uh, we, we need to postpone that so that we'll have some time during September to build that. Cause we do have three vacancies. Um, we have one person who's resigning one person on protective leave, and then we have that open position. So, um, there's a need in our finance department. And so we're rebuilding. It's a bummer that we're doing this in budget season rather than in February, but that's where we're at. So we need to be nimble and, uh, work together and we'll get through that. And so be fine. We have until December 31st. So we have plenty of time. We still have 16 more Tuesdays.

All right.

All right. Lindsay.

Thank you, Mayor, for introducing it. And I will just follow up with that. Yes, we are here this evening asking for some grace on the approval of a finance analyst position. The city does hold the existing budget funds within the finance department. And so the ask here this evening is just for the approval to move forward per our attorney's request that we did need to bring it forward, although the city does have existing budget within the salaries and the professional services line item. And so I guess I will stop there and see if there are any questions.

Thank you, Lindsay. I just want to make sure I'm clear. The memo to staff says that there is a $33,000 budget impact. But what you're saying is it's not an additional $33,000. It is already in the budget and will be used to fund this position.

That is correct. So the $33,000 is the impact of what we're estimating this additional position to be. However, exactly as you stated, that $33,000 is within the existing budget and is not an additional ask.

Okay. Thank you.

How long will the temporary be? How long is the position, the term limit?

We are following the city's employee handbook, which is right below. So there it states, I believe, for this city, it's, I believe, five months within a calendar year.

So the $33,000 is just covering the $26,000. It seems low for five months, I guess.

Great question. So it's not a full-time position. It's temporary help. So therefore, it's not a full-time requested position.

There's also no benefits associated with it because it's temporary. So that's why you see the low amount. And I will add, if Council does make a motion, I know there's a written motion here, but I'd like to add to that, that we need to establish the salary range in that motion, which is NR 47.

Regarding the term of this position, it does say five months in a calendar year, so it could be that this person, let's say they were hired tomorrow, could work the last four months of this year and then they could work an additional five months in 2027 because that would be a new calendar year. Is that accurate?

I think technically I will lean to human resources, but I'm pretty sure that is, I would lean to, I'll stop talking and lean to be an expert.

I would say if you did the motion not to exceed $33,000, then we'd have to come back for council approval no matter what. Got it.

Thank you.

So I have a question. I understand that it nets out. But I can't imagine we just have $33,000 sitting there, not earmarked for anything. That would be great news if we had extra money like that sitting around. So where is this coming from within the budget? What will it be transferred from?

Great question. So the finance department currently has a senior financial analyst position that is vacant. And so that was already budgeted within the 2026 fiscal year that was not filled. And so since I've walked into being your finance director, we worked very hard to get that description. Again, grateful it just closed yesterday, but we're still at... hopeful that we will have somebody in that seat within October. And that timeline might not be that quick. So we're just at a point at which we need internally help now, because I believe that you would like to actually see a budget and have lots of time to work through that. And that's what one of the main goals is, but we also have internally, a department to run. And so it becomes extremely challenging when you have all of these vacancies, keeping the operations moving forward in every department in addition to basically your statutory requirements, which are to have a budget. And then, as was previously stated, I'm new to you. And so probably every director here can back me up and say, I'm definitely a little bit different on how I'm approaching this. And so and I think that's a good thing in the sense of a different perspective, a different ask, a different way of an idea or perspective. presentation of this first budget will be a true mayor's preliminary budget holistically. And so my vision of what I would like to bring forward for you as a finance director is a little bit different than maybe what has been presented as a first touch to you in the past. And so I just sum that up as differences.

And then are we looking to hire externally for this position? Because if the goal is to get someone in now, I mean, I'm just trying to imagine what the applicant pool is like for part-time, cap at $33,000, hit the ground running because we have a budget to build. That seems like a really niche employee if we don't already have something queued up. So is that the plan?

Go ahead.

So as you know, I've been doing this a long time. So I called in a favor, somebody that retired from Monroe from the finance department and ran public works finance for years when I was a public works director. And then she was also there in that capacity the entire time I've been here. So I think she retired last year. So she is going to come out of retirement and can only work so many hours. So that's part of this equation, too. She can't go over those hours because she'll impact her retirement.

I'll be honest for a second. I thought you said you were going to be the financial analyst.

You're queuing that up. But I have a lot of people that are willing to jump in. We're not letting him retire. This person is willing to do this for us to get us out of this pickle. Awesome. Okay.

I guess just to be clear, it's not your intent to make this position permanent in this 27 year. It's just to bridge our need for vacancies now. Yep.

That is correct. And I will add to that, that we are working towards a permanent solution with a senior financial analyst. And there has to be some grace because when you hire somebody, they're learning. They can't just walk in and know your systems, your process. And so there's a lot of that taking place where there has to be a little bit of grace for a learning period. And gaining the knowledge, learning the systems. We are very fortunate to have somebody that our city administrator knows that we're able to bring in because the other bonus, they know our software system. There will be no education on that front. They can hit the ground running. And so that is a very grateful place to be. And but this is a stopgap. The bigger solution is to take it and have the senior financial analyst. And that is the long term solution. But immediately we're in a situation where my department. is too lean, period, end of story, really. And due to some things that are out of our control, the protected leave, that's just a situation that a lot of the departments are up against right now. It's a real challenge. how to continue your operations in addition to walking forward your budgets and everything else that you need to be working on. Meanwhile, looking at a different system, a different product, a different way of building it to have a conversation with being very thoughtful that we have new council members, making sure we give you appropriate time with the numbers to ask all the questions that you would like to ask. Um, but at this point it's, it's very lean and we need some, some help.

It's going to be a question for Jean. Do you anticipate that we will still have a full day retreat at some point later? I noticed, um, we talked about an extra meeting in September, but is, is there a, is there a desire to continue to have a full day or do you think we'll do this in meetings and workshops? Um,

What we've talked about right now is to just try and fill our workshops because it was so challenging to find a date that worked for everybody and going into the holidays, it might be a challenge. That being said, we were always prepared to put a retreat together and get in the same room, even if it's an early Tuesday or whatever it might be. Because our goal, again, like I put in my email, is to make sure that council has all the information they need to be able to approve a budget by the end of the year. And there's a lot of moving parts. So we will do whatever it takes to make sure that everybody's comfortable.

Great. Thank you. Yeah. And Councilman Rodgers, just to add on to that. So in Jean's email, we're going to meet on the fifth Tuesday of September, as it stands right now, the 29th. So that'll be a special meeting.

I guess I don't want to belabor that in the middle of our agenda here. I would like to allot some time for further discussion on that point just because I do have – I don't know if concerns is the right word, but I'm mindful of the fact that we have several new council members, a new finance director. There's a lot of new stuff to work out, and so just my initial reaction was – that maybe more time in the form of a retreat would be useful this year. But I'm also aware of all the challenges we've discussed tonight.

I sense we'll get a clearer picture of that once we get this additional help in there. That'll free Lindsay up to do some more research. traditional director work in the budget. And then, you know, we'll let you know for sure. Our goal is that the council has transparent information that we can prove and show or demonstrate rather, that's probably a better way to say. And then that way the council can have the conversation about their policy priorities.

That's good. And if we need to, then yeah, we'll, we'll adjust.

It's one of those things that's still evolving, Ryan. So we'll figure it out. And we have time. We do have time. Well, yeah.

I will add one more thing just to be incredibly transparent. Once we holistically put a budget together, although I'm new to you, I am not new to having budget conversations and walking through this whole process. So please be assured, I definitely know how this whole thing is working. And my future vision for all of the council and this city is that every single department will be walking you through their department budget. So to directly, you will get to ask them questions about how they, what's in their supplies, what's in the professional services, what does that make up? So you will get the direct one-on-one with each department. Then we will have a separate, at some point we will go through and we will walk through the CIP, the capital improvement plan all together. So then you will hear directly from each director, public works, parks, and community development on their projects specifically. And this has been a proven method in the past for me so that you will walk through each piece of the budget very granularly so you will understand how it's working and how everybody blends together to operate your city.

And my apologies, Director Vaughn, when I said a new finance director, I did not mean, I realize now that could have come across as inexperienced. That's not what I meant. I was referring back to your comment of new to us and just how we work together. So thank you for following up.

Any more questions, comments? All right. Is there a motion?

I move to authorize staff to fill the temporary finance analyst position per the employee handbook at salary range NR 47 not to exceed $33,000 in 2026 using existing finance department budget.

Second.

All right. Properly first and seconded. Any more conversation? Hearing none, all in favor say aye. Aye. Any opposed? All right. Motion carries. Thank you, counsel. All right. Item number seven, discussion items, public engagement guide. Is this Christy or Alicia?

Good evening, Mayor. Thank you. And City Council. I'm going to go ahead and introduce our amazing intern this year, Alicia McPhee. She's been great at helping us dig out of our backlog of projects that we had on hold. And one of these particular items is our public engagement guide. This guide is intended to be used across all departments. We've presented it to other departments and are currently receiving feedback from them. And so tonight it is her opportunity to present to city council. So I will turn it over to Alicia.

Perfect. Good evening, everyone. Yes, I'm the planning and community development intern this summer. And one of my main projects so far has been updating and reformatting the public engagement guide. And so today I will be presenting a brief overview of the guide. And some background, the guide was created and presented to the planning commission in June of 2025, but then was placed on hold due to priority shifting to long range planning. And the guide was picked up again this summer due to the department's bandwidth expanding from hiring an intern. And at the beginning of August, the guide was presented to the planning commission again And two weeks ago, the guide was presented to city staff from different departments. And the main goal of the guide is to provide staff with a one-stop resource to use when planning for public engagement. And the guide includes tools, methods, and guidance for all levels of engagement. And it is intended to help staff communicate projects early, gather input, and find solutions for engagement setbacks And all of this supports the city's mission of providing a safe, desirable community with open communication and public service. And on this slide, it's showing all the different sections currently within the Public Engagement Guide. And additionally, this guide is intended to be a living document that should be edited to best meet the city's mission, values, and strategic plan. And so for the next couple slides, I will be giving an overview of a couple different sections within the guide. So this guide adopts the public participation spectrum framework, which is designed to assist in selecting the appropriate level of participation based on the intended role of the public. The framework identifies five different levels of participation. participation, which is informing the public to understand issues, options, and solutions, consulting the public by gathering feedback, involving the public to ensure public concerns are considered throughout, collaborating with the public by actively involving them in each step and decision. And lastly, empowering the public by placing final decision-making with them. And also within this section, there are guiding questions, a visual that illustrates how communication flows between the city and the public at each level, a flow chart to help assist in determining which participation level is needed for your specific project, and an updated and expanded public participation spectrum table, which is the table on the slide here. And this table provides more details, examples, and challenges for each level. And overall, the public participation spectrum framework intends to help reduce over and under engagement and ensure adequate engagement will be met for each project. The guide also includes guidance for successful facilitation and how to ensure productive conversations, staying on topic, and that all voices are being heard within a discussion. On the left of this slide, there is the ground rules for collective creativity, which focuses on creating an atmosphere of positivity and moving forward within community collaboration. And then on the right, there are tips and guiding questions for creating meaningful community engagement with all members of the community. Next, there are resources that can be used for identifying stakeholders, collecting and organizing stakeholder interest and information, and determining the level of impact each stakeholder will have on the project. Additionally, there is an extensive list of common stakeholders the city works with that is categorized by audience. And some example of those audiences are environmental organizations, housing project partners, and community groups. At the end of the guide, there are more tools, resources and templates that can assist staff. The templates include project boards, posters, reports and timelines that the staff can input their specific project information and use. And additionally, there are 15 engagement techniques that are identified because they fit the city's goals and are innovative and underutilized and each of those techniques are listed alongside considerations strengths and potential weaknesses or issues that can arise. We have received a lot of great feedback from the planning commission and city staff from different departments on the resources, templates, and usability of the guide. So edits and additional resources were brought forward and have been incorporated into the guide, as well as creating and linking a public engagement templates and examples folder within SharePoint. So having that easy access of finding those templates And for next steps with the guide, continuing to gather input and feedback on the guide, releasing the guide to staff to use, and since the guide is intended to be a living document, continuously editing and updating the guide to best support city staff. And that is the presentation going over the guide. If anyone has any questions, comments, concerns.

I just wanted to thank you. Good job. And it was very thorough. There's a lot in that guide. So I think if anyone has any questions, it's pretty easy to find in there. It was laid out very well. And I can definitely, as I was looking through it and reading through it, think of several times a city has used these methods successfully engaging our citizens with different projects we have. So I just wanted to say it was very thorough and I think will be a useful guide for our city. Thank you. Perfect. Of course.

Uh, on, um, page 3 of the guide, which is page 10 of the packet. The figure 1 is the public participation relationship visual. I like that. I just had a couple of questions about 2 of the comments. So, under collaborating. It's collaborating with the public to ensure they are actively involved in every step in decision. So I'm just wondering. If we want to go that far as saying every step and then empowering the public by placing the final decision on them, what does that mean, placing the final decision on the public?

With that one, it was more of when the public would be voting on something. And so whenever those votes determine the outcome.

Are you thinking that we should include a blanket statement in there to put applicable decision-making body? Because in some cases, obviously, it will be the city council or a park board.

Ultimately, that's what I'm getting at, right? There are many decisions where we want their input and they aren't making the decision. Correct, correct. And so I didn't see explicitly in the text leading up to this about it specifically being in a situation where they're voting. In that situation, yeah, they are going to own that. Most scenarios, I would say, we're seeking their feedback to help guide our own decision-making, but not have them be the final decision-maker.

Perfect. We appreciate that, and we will make the revisions. Thank you.

I have a question. On the same graphic, the informed consults involve Collaborate, Empower, and I don't see social media as an example of informing. And I think we've talked a lot about social media and maybe calling that out along with the website would be good. And the other item, the way I read it is that each level builds on the previous one. So consulting would also include informing and so on. Am I understanding it correctly to get to that? That each level would build upon the previous. Okay.

Yeah.

Thank you.

I do see on page seven where it says notify, it does have social media listed on there.

I just want to reiterate, I think this is a great guide and puts some sort of structure in place to some things that are already happening. One thing I wanted to point out on appendix for the list of common stakeholders, I think there's just a minor typo where it says city staff. The second bullet is parking and recreation board. I think that's meant to be parks and recreation. Thank you for that. Yep.

I don't know. We're talking a lot about parking.

It's an issue. We don't have a board. Maybe we need a parking board.

We need a parking commission. Department of parking. Right.

Well, I love it because we've presented it three or four different times. And every time we get different comments from different groups. So this is very helpful.

It's a lot of information.

So I'll just say one thing to piggyback on Nathan's point, only because I'm now noticing it. The next graphic on page 11 at the very end, it does specify that you can intend to give decision-making authority to the public on all or part of the decision. So I think that distinction is in here. Maybe it's just worth ensuring that it's consistent across all the graphics and examples.

Thank you. We'll do that.

Thank you. And great work.

Yeah, no, I was going to say this is fantastic. And I think a lot of the complaints that I hear within the city citizens is either not knowing information or not being able to find information. And I think that this is a really great step towards addressing those concerns within our community. And I really appreciate the work with the department and our intern. Thank you very much.

Thank you.

All right, thank you. All right, we'll move on to item number 7B, stormwater utility rate study. Shannon.

Sorry, we needed to pass the microphone. Good evening, Mayor and Council. Tonight, we're going to bring to you a presentation about the stormwater utility. The stormwater utility is an enterprise fund. And what that means is it is a special accounting fund that is used to support our stormwater utility. So that's catch basin, stormwater facilities, treatment facilities, stormwater pipes our capital projects and that fund the revenue comes from fees that are attached to every parcel in the city the way that those fees are attached to the parcel depends on the type of parcel it is and then the amount of impervious surface that's on that parcel that's something that we're going to explain to you tonight in the presentation Tonight we have at FCS, this is our consultant that we've hired to do this rate study. We're going to take a look at the fees that we currently have in place, and we're going to evaluate those fees based on our current needs and our future needs to manage the stormwater utility. The last time we did a study like this was in 2018, and this is just the first presentation to kick it off. We know that several of our council members here are new, and because we haven't done one since 2018, this presentation is really intended to just give you a lot of information on how do we calculate these fees, what are the things that we consider when we evaluate if we're Charging the right fee, and this is really the 1st presentation that you'll get of several that will be coming after this that will hopefully be setting some new fees here by for the end of the year that will be implemented in 2027. So with that, I'm just going to pass it over to Taji. He's with FCS and he's going to run through this presentation. During the presentation, if you have any questions, maybe just note them down and we'll have an opportunity to discuss it after the presentation. But if there's something really pressing, feel free to just speak up if need be. And Taji, I'll pass it off to you.

All right. Thank you, Shannon. Can you all hear me okay? Yes. All right. Let me share my presentation and we'll get going. All right. Is that coming through okay? Yes. All right. Well, good evening, Mayor and Council. I'm Tagi Ocker, Senior Project Manager with FCS. As Shannon mentioned, we're the consultants working with FCS your surface water and finance staff on the stormwater rate study. And as she mentioned, we completed the previous study about eight years ago, so good to be back to help update it. And just want to reiterate, tonight is an overview, not a decision point. So by the end, hopefully you'll have a good understanding of why we're doing the study, how stormwater is funded today, and then what to expect over the next couple of months as we bring forward rate options. So quick roadmap for tonight. We'll start with why we're here, what we need from you, then we'll get into some background on what is stormwater, what does the utility do, some general items like that. And then we'll look at specifically Lake Stevens stormwater utility, what it does, what types of infrastructure it has and needs to take care of. And then we'll get into the rates and what drives those rates and what residents pay to date. And then we'll close out with a schedule for the rest of the study. So this is, you know, informational briefing. We're not asking you to prove anything this evening. We're right at the beginning of the study. In about October or so, we'll come back with refined draft rate scenarios for you to consider and react to, provide feedback on. And the goal would be then to adopt final rates at a 2027 council meeting. towards probably the end of November. And that would allow us to then hit a key deadline, which is by September 1st, the city's got to notify Snohomish County. Snohomish County provides the actual billing of the stormwater rate. It's a rate on the property tax bill. So we've got a lot to do between now and then, but we're already gathering and analyzing the data and well on our way. We're generally proposing to break this study into two phases. Phase one is what we're currently working on right now. It's essentially a five-year financial plan. We'll take a look at the lake management assessment fee and then bring back results for council review. Phase two, if it were to proceed and get contracted, would be a separate phase, primarily focusing on auditing the impervious surfaces citywide. and impervious surfaces is how that stormwater rate gets billed throughout the city. We'll validate customer billing data and then consider whether there are rate structure changes that might be appropriate down the road. But tonight we're just focusing on phase one and that's all we're focusing on throughout 2026. So let's start with some stormwater basics and why cities manage stormwater. Some of this may be review, but good to cover our basis here. So stormwater is simply rain or sometimes snow melt that runs off streets, parking lots, roofs, impervious surfaces instead of soaking into the ground. So as it flows across those impervious hard surfaces, it can pick up some pollutants, contaminants that pile up, sediment, fertilizer, brake dust, other types of debris on the roadway. essentially by stopping that water from soaking into the ground naturally, it can also speed up how fast that water moves. So if you don't manage it correctly, there's fast moving polluted water and that can cause some issues like flooding, erosion and pollution in water bodies, including Lake Stevens itself. So generally to manage all of that, stormwater systems can be expensive to run. They're built on a lot of physical infrastructure. It might not be as obvious as, say, a water pipe or a water pump station, a sewer treatment plant, but there's a lot of pipes, ditches, ponds, catch basins, treatment facilities throughout the city that need to be built, maintained, and eventually replaced when it comes to the end of the useful life of those assets. So they tend to last a fairly long time, but that also requires long-term management, both operationally, so through inspections, maintenance, and then also by financially managing those assets, setting aside money for the eventual repair and replacement before those items can fail. Some people ask, well, why do we do this? Stormwater management is not optional. As a phase two permittee, the City of Lake Stevens needs to meet a whole host of permit requirements, planning, pollution detection, runoff control, system maintenance, education and outreach. These are legal requirements that essentially set a minimum level of service that the city must provide. in addition to a lot of the capital related items that we touched on the previous slide. Now let's look at what this can look like specifically within the city. So here's a general scale of what the city maintains. Nearly 175 miles of pipe, over 6,600 catch basins, and over 130 city maintained stormwater facilities like ponds, treatment systems, So off to the right, we have a zoomed out version of the city. Shows all of it, the catch basins, culverts, ditches, pipes, outfalls, where it eventually reaches natural waters. This just shows more of a zoomed in picture. But as you can see, quite the extensive set of infrastructure throughout the city. And this system is what the rate study is built around. maintaining it, taking good care of it, and supporting the staff needed to do those activities. A couple of recent examples of capital projects we'll talk about in the next two slides. This is a recent example of some stormwater work getting bundled together with other city projects. This is the 91st Avenue southeast sidewalk project, which In addition to providing some stormwater benefits, also improved access to schools. So in this case, bioswales were added, so essentially planted landscaped drainage to help manage runoff and improve water quality. Total project about $2.3 million of that roughly 25% was covered from the stormwater fee to cover the stormwater portion of that project. So I'll give you an example of some some of the areas where you're spending your dollars. Another one, similar story, 131st Avenue Northeast infrastructure. City added planted drainage swales here to protect water quality, improve groundwater recharge. It's adjacent to a PUD well site, so taking care of that is important. Total project cost, $2.5 million, about 180 of that coming from stormwater fees for drainage-specific work. So two recently completed projects. This project is on the horizon. The timber bridge replacement at 36th Street and Catherine Creek. Reaching the end of its useful life and already causing some lane closures due to some deterioration and erosion. City plans to replace it with a larger concrete bridge next summer at the cost of $3.6 million. City is currently working on Financing that through a 20-year loan to be repaid with stormwater revenues. So a good example of Sometimes we cash fund projects. Sometimes we borrow to spread out the cost of capital say over a longer time period Beyond these big capital projects system needs constant routine upkeep so we have a couple of pictures here of of various maintenance related activities. One of the jetting crew, when they find a problem, they use the Vactor truck to clean sediment out of the catch basins. City also runs scheduled street sweeping to keep debris out of the system in the first place. And then the bottom right, you can see filters to help strain out pollutants. And those need to be replaced on a routine basis. So under The permit, once an inspection finds a problem, the city has a clock running to fix it. As little as six months to fix it for catch basins, up to two years for larger issues that require more construction related efforts. But a lot going on here in terms of the maintenance side as well. Staff have been using camera inspections or CCTV to look at the inside of some of the pipes throughout the city to get a condition assessment. And this isn't the case throughout the city, but some of the problems that you might expect with the aging system, tree roots can grow into pipe joints, blocking the flow. There are sections where you can see in the pictures where the pipe wall is actually collapsed or cracked, and that left alone could lead to sinkholes potentially. There's other examples of sediment buildup that can choke out capacity, reduce the capacity of the original pipe. And then some of the older metal pipe sections, there's also some examples of corrosion. So staff use this information to help prioritize which pipes to replace and when. So this type of pipe replacement is a capital cost that also needs to be factored in to the rate study. So that's the program, and now we'll talk about how it's actually paid for today. So essentially, as mentioned at the beginning, stormwater operates as an enterprise fund. So stormwater rates provide a dedicated funding source that stays with the utility, and that helps pay for maintaining the pipes, catch basin ponds, other infrastructure, some of the regulatory requirements that come along with the stormwater utility. So currently, the city charges based on an equivalent service unit, or ESU, where one ESU equals 3,000 square feet of impervious surface area. So most single-family homes pay one ESU. Larger non-residential properties pay more if they have more impervious areas. In terms of what benefits the program provides, it helps protect water quality, reduce flood risk throughout the city, helps maintain that infrastructure already in place, and help support lake management efforts as well. So in short, rates help ensure that the community can meet its stormwater responsibilities while protecting residents' property and local waterways. For a typical home, the rate was $273 per year in 2025. currently is $281 in 2026 and currently projected based on the current schedule to be 290 in 2027. So in this year, 2026, that's about $23 per month. The rates in this period have been increasing by about 3% per year. Part of the study is to evaluate whether or not that planned rate for 2027 is sufficient to meet projected needs or if other adjustments might be necessary. And kind of here's the problem in a nutshell. Since 2021, the rates have been increasing by about 3% per year. But some of the costs that the utility must account for have been increasing faster than that. So we see Lake Stevens rate here in the solid blue line, 3% per year. This shows the cumulative change between 2021 and today. Construction costs, which of course drive some of the capital project expenses, are climbing by about 4% per year based on a local construction cost index. General inflation, which can have an impact on salaries, supplies, materials, services, has been increasing by about 5% per year. So, of course, when your revenue grows slower than your costs, that gap has to be made up somewhere. And that's a big part of why we're doing the study now rather than later. It's pretty common for cities to do a stormwater rate study every four to eight years. make sure rates are in line with the cost of providing service. We can see some of those cost factors showing up in this graphic here. What we see here are the actual 2024 revenues and expenses. The revenue is that yellow line. And then the expenses are those stacked columns. You've got salaries in blue, benefits in orange, supplies and services in yellow and green, and then a smaller slice there for outstanding debt principle and debt interest. So a couple of years ago, revenues exceeded those costs by about $800,000. That could be put towards capital projects, but you can see in the most recent two budgets, 25 and 26, revenues were just below expenses, essentially leaving little to no money to set aside for capital projects. So any capital projects during that time would have needed to come from drawing down existing cash reserves. So one of the few key items we want to touch on in the study and focus on here is a utility operates as an enterprise fund, meaning rates must cover the full cost of providing service. That can include operating expenses, meeting reserve requirements, and funding long-term infrastructure investments, capital replacement, maybe new capital facilities as warranted. So bottom line, All we're doing with a rate study is forecasting out your costs, comparing against that the revenues under today's rates, and then seeing if there's a mismatch there, and if there is, what rates would need to be to fully cover the utility over the study period. So here's the math about how we get from the revenue requirement to an actual rate. So you'll take the total annual revenue requirement, everything we've just discussed, divide that by the customer-based, measured in what's called ESUs or equivalent service units. And again, recall that one ESU, that's just a standard unit to fairly compare how much impervious area there is on one property type versus the other. So the larger impervious footprints generally pay more, proportionately more. So you divide the total need by the total ESUs, and that gives you the annual rate. That's the number that ultimately shows up on a resident's property tax statement. It's a rate that also gets billed alongside property taxes and other fees. So they don't get a monthly or bimonthly bill. It's an annual fee that they see. So when we're putting together a long-term forecast, it's important to think about different ways. How might we fund capital projects? If you can get grants, great. But otherwise, the question comes down to cash versus debt or some hybrid approach. Debt financing helps keep rates a little bit lower in the short term and helps spread out that cost over a longer time period. So as new customers connect, they begin to help pay towards debt. that annual debt service, where more is the cash, pay as you go. Some benefits are you avoid debt interest, but might require higher rates upfront. So typically, it's common to see a utility take a hybrid approach, you know, cash funding, routine repair and replacement projects, and perhaps saving debt for larger one-time type projects that would be hard to save up for in advance. So this slide walks through some specific assumptions that would be built into the financial forecast, things like inflation rates, the study period, growth projections, reserve targets. These are the inputs that will drive what we'll bring back in October. We just wanted to kind of lay the groundwork right now in terms of what we'll be basing the study on. So we'll be focusing on about a five-year period, making sure you have enough cash in the bank to meet your rainy day reserve funds, some modest customer growth assumptions based on what we're seeing throughout the region and different cost indices. We'll take your current budget estimates and inflate them somewhere between three and five percent per year depending on the cost type and some benefits we've seen have gone up even more than that on an annual basis. I will make sure that The rates will cover both your existing and potential planned borrowing, as well as cash funding a portion of the capital plan. So before we wrap up, I think it's helpful to see how Lake Stevens compares to other Washington communities. A few years ago, we surveyed more than 60 cities and counties across Washington on their ESU value, equivalent service unit. Essentially, that's how much impervious area counts as one billing unit. So you can see in that dark blue column there, Lake Stevens comes in a bit below the median, but very close to it. So cities in line with how similar communities are structuring their billing. So that's good. In terms of the actual rate, we also surveyed mostly a different group, but showing what the Current 2026 single family annual stormwater rate is, and you can see at $281 per year towards the middle of the group, I think just below the midpoint there. So some useful context as you think about where a future rate adjustment might land relative to other communities. So where do we go from here? Here's the schedule for the rest of the study. So this month in September, we're continuing to gather and analyze the data. And then throughout September, October, we will be reviewing draft scenarios internally and then with city staff. And then we'll bring forward in October draft results to a council meeting for your review. In November, we'll take any feedback we get in October, make tweaks as needed, and then present a final rate option report. And that's where we'll be asking for a decision so that by December 1st, the city can then notify Snohomish County so it can be included on schedule for next year's property tax bill. So with that, I open it up for Q&A questions, comments you might have. If it's rate finance related, I can help answer those. If it's more operationally capital, I might defer to city staff.

Yeah, can you go back to the timeline? So I'm trying to balance the fact that this is an enterprise fund and so to some degree it needs to be self-contained, I guess is the word I would use. But you also talked about the minimum level of service required by law versus doing a level of service above that. And so how do we balance the budget conversation specific around this activity, this enterprise fund and the overall budget activity, right? If we would say, hey, we're willing to, raise our rates here because we want some level of service, but we're going to pull back rates in some other fund so that the community isn't hit too hard. I mean, I'm not saying towards this one fund. I'm not saying that. I'm just saying I want to look at all of the budget conversation together. I'm hesitant to set any rates without looking that outside of the whole context of the overall budget. Even though this must be self-contained, it's still a piece of the bigger budget puzzle. So how do we balance those things?

I hear your concern. And this enterprise fund, the rules around an enterprise fund specifically mean, as your words self-contained, I think that's a great description. So it has to – the revenues have to support – Any form of expenditures that are coming from that direct fund. So any expense, whether it's staff benefits, supplies, capital, that whole package, debt, which we're working internally towards. We've gained the design from the Public Works Trucks Fund and have submitted an application. I'm drawing a blank on the project name. 36th Street Bridge, thank you for the assist. And so that basically the surface water fund has to, I mean, I understand that you're concerned of wanting to have the whole budget. However, this piece of it has to stand alone. Does that make sense? Yes.

It does, I guess. Go ahead, Shannon.

Oh, so maybe I can just ask a clarifying question. Council Member Packard, what you're referring to is how are we looking at level of service for stormwater? And there's a regulatory component and then there's potentially an enhanced style level of service. And your concern mainly is that as we look at the budget as a whole and we look at level of service throughout the city, we may be scaling back on our level of service in other areas because of the impacts of the budget. And how are we balancing looking at an enhanced level of service in stormwater versus maybe scaling back somewhere else? Is that correct?

or scaling back in stormwater to the minimum or closer to the minimum because we feel like we need to increase rates in some other area. And so I'd like to look at the holistic impact on the community, if we do need to raise rates somewhere, where does it make sense to do that? And how do we balance those things? Because in isolation, we might say, oh, yeah, only going up to 290 or 295. Okay, it's only 12 bucks a year or whatever. No big deal. But then that happens three or four or five times as we look at all the different budget components and it adds up. So It doesn't mean we need to have this, in my view, fully fleshed out, right? The full budget doesn't need to be done, but I don't want to do it in isolation. I'd like to at least have some other larger budget context before making decisions on this.

Yeah, I think this timeline is consistent with that. I think this matches the budget process as we're going to work through it. So you're sort of asking about household impact. That kind of works well. So, yeah, I think this is consistent with that, and I think that's a prudent thing to do.

Thank you.

I have a couple of questions. So the 290 is the adopted budgeted for 27 as an increase and the potential in November is to ask above that. Is that my understanding? Am I understanding that correctly?

Yes, you are understanding that correctly. In our current fee schedule, the rate is set at 290 for 2027. In this rate study, we will evaluate that rate and determine if that rate is appropriate or if there is another rate that is more appropriate to serve the utility.

The other, as we were talking about rates and there's a minimum per parcel, but there's, you know, room to charge more for bigger parcels, but there's not really, it doesn't seem like there's room to charge less than the minimum. Is that correct? Is the one ESU? You're correct. And the other, as I was thinking about this, there are some HOAs that maintain their own retention ponds and that fee for maintaining those facilities is factored into the HOA dues. But, you know, the city maintains some stormwater ponds for some, you know, developments that have dissolved their HOAs or, and I guess for somebody that does belong in an HOA that maintains a stormwater facility, it feels like, they may be hit twice with more, whereas they can say, why doesn't the city maintain all retention ponds so that we pay this fee, especially those developments that have townhomes or that I guess the surface area that's impervious is less than maybe than the minimum. And I guess that I see as a question coming up.

Yeah. That that's a great question so currently the city does not maintain any private stormwater facilities. With the exception of stormwater facilities that were dedicated at the time that those neighborhoods were developed and those are typically a lot of our older facilities that were. dedicated many years ago. And so because the city owns those properties, those are the ones that we do maintain. But you bring up a great question. And this is actually a topic that we have discussed several times over the last several years is, you know, is it in the city's best interest to maintain all of the stormwater facilities and then charge a rate to do that to where HOAs aren't maintaining their own?

don't know that we have an answer to that right now and that's not something that's currently in the level of service scope for this rate study but um i think that's something that we can continue to look at if there's an interest to do that and one one last one i guess um i noticed that in the capital projects that we do it's always um so the stormwater fund is used to pay a portion of of the capital project and we've heard in the past of some some folks that came in i believe And they were questioning the percentage of the capital project that is using stormwater funds, that it may be greater because stormwater is an enterprise fund and there'll be more money set aside for that. How is that? I know it's project by project, but I guess at what point do you evaluate whether like the 91st Street, for example, How much money do you allocate from the fund to the project to kind of fill in? Overall, we're all benefiting from the capital project, but it feels like sometimes that might be questioned on the percentage of usage.

Yeah, that's a great question. So the stormwater utility fund pays for the stormwater portion of the project. Some projects may have a higher contribution from the stormwater fund. fund because the stormwater portion of the project may be a higher design. It may have to include detention. It may need to include treatment. And so it's really project dependent on how that is evaluated on how much is contributed from the fund.

One thing to add. Regarding the HOAs that have been dissolved, We've explored that, and it's interesting because it's not really true. I mean, it's not true in that when they dissolve, they're not responsible for their stormwater ponds. They're still responsible for their stormwater ponds. It doesn't matter if they put their hand up and say, we voted to dissolve. Now the city owns the stormwater pond. That doesn't work that way. Shannon's team's done an exceptional job identifying those ponds and getting the word out. And they have this fantastic portal, if you haven't seen it. It's worth looking at for homeowners where they have questions about these things and they can go find the pond in their neighborhood and get information and try to get their coalition of neighbors back together to maintain these ponds. So the city does not by default take them on should HOA dissolve. I just wanted to clarify that.

Yeah. Okay. Yeah. What happens if the neighborhood gets together and no one wants to clean it and nothing gets done, then what happens?

You know what? I'm going to pass that to Shannon.

That's a wonderful question.

A lot of wonderful questions tonight for you, Shannon.

That is a challenge, and that is not a challenge that our city faces alone. Other jurisdictions have this challenge as well. As Aaron talked about, we have a program that we've been trying to get going around this. We've started with education. We've started with helping them with resources on how to find people to do the work. We've been pretty successful, actually, in just informing people on what to do and why they have to do it. There are ones that we are not successful on as well and that have been dissolved for 20 years and nobody wants to maintain it. We have looked at options for an enforcement program and it's something that we're still working on as our capacity allows us to do. And that may look like in the form if the city does come in and actually maintain it for them and bill them for that maintenance. And they would get billed at a proportionate rate that they own the stormwater facility. So for an example, if there are 50 homes in the neighborhood that all contribute to one stormwater pond, each person would have a 150th portion of the cost to maintain it bill. And that's a pretty big program. And then if we don't have people paying the bills and we're talking about liens on homes and things, it's definitely something on our mind and it is something what we're working on. It's something that we have it seems like several times a year, a conversation with all of our neighboring jurisdictions that are also going through this. And we don't have a perfect answer yet. And I don't know if there is one, but we're working on that.

Thank you.

Yeah.

I was going to say, I remember a presentation. I think it was a couple of years ago and more neighborhoods than not didn't even know they existed, you know, and, and, kind of felt blindsided when the city reached out to educate. And I don't know if maybe we could look up what meeting that was so that if our new council members wanna just kind of briefly take a peek at what that program is, they have something they can easily look up on YouTube.

So on that note, I actually live in one of those neighborhoods and we have a dissolved HOA and a detention pond that is not being maintained. And when the city brought that proposal to council, I remember watching that meeting and I used the portal to go on, look up my address, see all of the information. I went down to the pond and I saw they have like a sign there that you can scan the code. There's contact information to contact. I think it's the conservation district. They can come out and help homeowners organize a cleanup crew. depending on what the extent of the necessary cleanup is. And so my neighborhood in particular, you know, I reached out to several different neighbors and I didn't really get much response, but we haven't heard anything since then. And as far as I know, nothing has been done with it. So it sounds like pretty much on par with it's something that we know needs to be taken care of. And we know that we have these. but competing priorities, right? So yeah. But I think what you guys have done so far for education has been fantastic. I really appreciated having that.

Yeah. Thank you.

I just want to share as someone who lives there and I was blindsided, but it broke down to about, I think there was like a hundred, a hundred homes in my neighborhood that were assigned to that detention pond. And I think the estimate that was thrown around for Our particular one was $1,500 to $2,000 to get it cleaned. Break that up, it's a couple hundred dollars per household. So we're not looking at like huge, huge dollars. And obviously, the more derelict it is, the more it's going to cost to fix.

I think for me, the perspective was on the other side where HOAs do put money aside, do maintain them, and then feels like you're double charged for maintaining a a detention pond that the city counts in its inventory as one of the whatever hundreds um if in your inventory then you set aside how many are privately maintained maybe that kind of puts it in perspective but it it will feel like And it'll be a pushback of why am I maintaining? Why would we rally up? Or it's more about money, not the necessarily volunteer work. It's all about how much money do I pay for the maintenance? And it's not much, but I think, yeah, it'll, it might come.

That's a great segue into my first question, the money we pay to keep stuff up. On slide 18, I'm looking at the CPI line and the construction index line, and I'm noticing down at the bottom they're based on some pretty large cities. Specifically, it looks like the CPI line is based on Seattle, Tacoma, and Bellevue, and then the construction cost index is Seattle exclusively. And so I'm curious how much of that 5% inflation for the blue line and 4% for the orange line is actually affecting us in Lake Stevens, because if it's lower for us, then our 3% increase is a lot closer to the inflation we'd actually be experiencing here.

Yeah, that's a great question. These are the most local indices that are available. But yeah, to your point, these are not Lake Stevens. Based on what we've seen in other communities throughout western Washington, some of the same trends tend to apply, whether or not it's north or south of those areas. But yeah, point taken there.

Okay. And because also the one comparable that jumped out at me on slide 26 is Linwood. I guess 25 and 26, they measure an ESU almost the same as we do, but their population is very similar. I know the makeups of the cities are different, but they're charging significantly less than we do. And so I'm curious, you know, I would expect them to be hit harder by these inflationary effects from some of these bigger cities down south than we would. yet somehow they're measuring an ESU roughly the same and they're charging significantly less. So I was curious if you could, anyone could shed any light on why that might be to help explain that difference.

Well, one thing that's important to keep in mind when doing these comparisons, every city's unique. It's apples and oranges. This came up recently and we did a study for Normandy Park, just wrapped up here. And their rates were comparatively higher than most of their neighbors. And at least in that case, it was they're mostly residential. There's not a larger commercial base with big impervious footprints to spread the costs over. And they had some, you know, topography issues to deal with that others didn't have. So it really depends on, you know, customer makeup, how big or small the service area is. And also, you know, it could be that some of these cities are choosing a lower or higher level of service as well. Maybe some are content being reactive for the time being. Others might be choosing to be more proactive for whatever reason. So really hard to know exactly why that might be. different but just know that yeah it's it's a apples to oranges comparison but if we do a study and don't do this type of comparison councils will often ask well what are our neighbors paying in other cities and counties so just wanted to kind of point out some of those often cited comparisons here

It seems like also going back to Councilman Packard's point, these decisions are part of bigger decisions that every council makes in every city. And I think about Linwood and I think about their retail business. sales tax income, like it very much could be that in that city, they have such a large revenue from that, that increasing stormwater rates for them isn't something that they see as part of their overall revenue package for their city is, you know, an important area. So, I mean, every city up there, I think, I think to his point, that's a, that's really good. It's apples and oranges because that's council members sitting in these seats, making decisions based on the complexities of their city and revenue decisions.

And maybe I misunderstood the discussion earlier about the stormwater funds having to exist in a vacuum and be self-contained and meet a minimum level of service. My assumption was that Linwood would have to meet at least some level of service and that their stormwater revenues and projects would be broken out similar to the way ours were.

I had a question as we're comparing cities. Lake Stevens is unique. in that we have, as far as I know, I think the largest lake in our county, several salmon spawning streams throughout our city. All of these things, from my perception, would require a higher level of stormwater control than a city that doesn't have a large lake, that doesn't have a lot of salmon spawning streams, that doesn't have the environment that we have here in Lake Stevens. Would that be an accurate thought?

Yeah, you bring up a good point. I think what we're looking at is exactly that, and what we've been talking about, that these cities are unique. And so we set those – these rates are set based on that level of service. There is a minimum that all of us have to meet per the regulatory requirements, but that minimum – you know it does vary between cities based on what our priorities are so it really when we've set these rates in 2018 we looked at what are our priorities we looked at capital projects we looked at new permit requirements that were coming up we looked at equipment that the city needed to replace and that's what helps set those rates when we look at the comparison of linwood to We are really looking at two different types of cities. We may have similar populations, but they may have much more. I don't know the exact number, but they have likely more ESUs than we do. And so that number that they divide by, when you saw that the total number revenue that they need divided by the number of ESUs sets that rate. They have a much more commercial-based infrastructure, and so they might have more ESUs than we do. And so their revenue may actually be higher at that lower rate to support the level of service that they are providing to the stormwater utility. So we're unique in that sense that this is based on our level of service and then also just the number of ESUs that we have in the city based on the composition of our city.

Would it be incorrect to assume then that there's also a proportional demand placed on their stormwater system from those extra ESUs? Because I was assuming that their costs would also be higher with a more complex system to service more ESUs.

Yeah, and it potentially is. It potentially is. It's just it's hard for us to know without really diving into their infrastructure, into what their level of service is and what their operating costs are and where they may have where they might have some efficiencies with their other utilities too, as far as what the equipment they're using or how they're maintaining things. It's really just kind of like a feel of, you know, where do we sit amongst everyone else? But if we really want to start comparing it, we need to look at the assets. We need to look at their maintenance schedules. We need to look at what type of level of service are they providing and how did they calculate that rate?

That's fair enough. So that segues nicely into my last question, which is comparing us to ourselves. Slide 19. I guess the first thing I want to make sure I'm clear on is what falls under the green box of services? What services are we talking about there?

Slide 19. It's 20?

Or 65? Yes, that one. Thank you. Gotcha.

Okay, we added one slide, the project slide, the upcoming project slide. So shifted all of the page numbers. Got it.

Okay, sorry about that.

Yeah, it's slide 20.

So yeah, it's services, I guess, just at a high level. What does that entail?

I... We may have to get back to you specifically on that. I think what that is, is when you break down the different fund types, you have supply funds and then you have service funds. And so services may be something like hiring our consultant as a professional service. We have a contract with the conservation district as a professional service, and then we have supplies. So that's pipes and that's filters and that's, you know, throw and go that we have as supplies. So I think that's just the different fund type. And then you have salaries and benefits. And then of course, our debt. And so that's where the services is. And I like 98% sure that's what it is. Okay, we are 100% sure.

So it's all right. So it's not costs related to the level of service we provide.

No, it is just simply the type of

fund that's yeah the professional service okay i feel much better now because for a minute there it looked like we were spending way more money on staff and benefits while our services dropped dramatically so all of these combined is what provides the level of service got it thank you okay can i say one more thing about this topic here

Yes, go ahead. Council Member Packard.

I'm willing to – I'd like to pull the thread on Linwood. And so I think I'm interested in what they do. And their public works director is – I worked with him for years. And so this will be an easy thread to pull. I'll come back and we'll report on the nuance of – Of Linwood in particular. I don't want to do all of them, but because it would take me the rest of the year in my life. But let's just do the one and then we'll see. We'll see what it is. I'm interested.

Yeah, I mean, if it can be done and they're. You know, there's learnings that can be shared, you know, all that. Great. But just know that my question was satisfied. So anything extra is appreciated, but it is extra. So thank you.

I do want to say that I think the purpose of the comparison between municipalities is really looking at the burden on the household. So that's really the intent of it. um so i'm interested in theirs in particular but keep that in mind as you're looking at that is not not always like what do they do it's more about how is the burden um distributed in other municipalities and are we out of line with it um and that's kind of that that litmus test more of that than than the other but anyway

No, I totally agree, and I would say that. And then the other half of it for me is where is our inflationary impact? Like is it really Seattle, Bellevue, Tacoma, or do we have a little fudge room there?

Oh, yeah. We'll take another look at that. But, yeah, it's the metro area. And we've been through that before, but let's come back and report on that as well. Okay, thank you.

So a couple of different trains of thought, and I'm trying to figure out how to keep them concise. So Councilwoman Raya, you've talked about something doing smaller than what this minimum is. And so I'm thinking about, yeah, how does a townhome get charged versus a single family home? Part of what I'm getting towards is I'll call it attainable housing, not necessarily the context of affordable housing and what that means. I'm calling it attainable housing. And the impact of an affordable housing is included in that. But I'm just trying to make point there that right for all of us trying to find out, buy a house in the city and live in the city. And then also for those who have lived in the city for a long time and have a home and feel like they're getting priced out of their own home. Um, so, um, yeah. So what, what, what, what policies, I mean, I see Bellingham has zero to a thousand, thousand to 2000, you know, above 2000 kind of thing. They've broken that up. Have we looked at doing something like that? Does that make sense for our city since we're largely single family homes and Maybe that doesn't make sense to break that up for any reason. And then part of this is connected again to this context, but also the broader context of what does it mean for us to change how we do our rate increases to say, for example, if you bought your house, you don't pay a rate increase until that house gets sold. And then at that point, the rate increases to whatever the level it should be or something to that effect. And that's a much broader conversation for the city council in terms of how we would want to approach that. This is an example of that, but those are just some of my thoughts. I don't know if it's a question right now, but.

Yeah, no, I appreciate those thoughts. And maybe I can just provide some additional information for us to consider. So when you talk about a townhome versus a single family home, the way that we evaluate the rates is there's a specific requirement. So any multifamily property, so that may include townhomes there, is then evaluated based on the amount of impervious surface. And so We actually calculate how much impervious surface is on it, divide it by 3,000, and that's the ESUs. So you may have one person in a townhome actually paying less than an ESU because they're paying that portion for the entire property, whereas a single family home is paying for their home on their lot, and that's just that flat one ESU rate. And so there is opportunity there. you know, if you live in an apartment complex, you're not, every person in that apartment is not paying the one ESU. They're paying that proportion impact for the entire complex. And so that may look like less than one ESU. So maybe that provides some clarification on that front. As far as you know, how do we come up with this 3,000? Or is there opportunity for these really large homes that probably do have more than 3,000 square feet on their property versus these really tiny lots that we have that maybe don't have that much? That's really what we were talking about in this next phase of a rate study. And to do that, we have a lot of opportunity. There's a lot of tools out there right now to To be able to really look at all the impervious surface across the city and actually make that evaluation. Do look at all of our single family residential parcels. And then what is the span of impervious surface? And is the 3000 number correct? Or do we actually need a couple of those tiers to be able to charge people more proportionately? I think that's a great question, and I think that is something that we may want to consider doing. It's not included right now because that actually requires us to look at some additional information and gather all that additional information to be able to make those policy decisions. But we are proposing that as the next phase to this. This phase really is just can we sustain what we need to do, the equipment that we need, the capital projects that we know we have coming, the replacements that we desperately need, are our rates set correctly for that? Yeah.

That's a great question and definitely a trend that cities are considering. Why charge one rate for all? It's very common, I'd say the industry standard, but as rates are across the region becoming higher and higher, more and more communities are looking at a tiered single family rate structure, like a small, medium, large rate. So you might, if you have a smaller footprint, you might fall into the small bucket and say, pay half of 281. If you have a much larger home and a bigger driveway and a paved sport court, you might fall into that large tier. So Bellingham, they have this, Whatcom County has this, Gig Harbor, Des Moines, they all have tiered rates. It's an emerging trend. I'd say not very common yet, but becoming more and more of an interest as trying to provide a little bit more rate fairness. 10, 15 years ago when rates were much smaller, five bucks a month, it wasn't as big of an importance. But as regulations are increasing, it's costing more to maintain the infrastructure. That's an excellent way to do that. So I'm glad you brought that up. something we can look at in phase two.

Yeah, and to be perfectly fair, I'm not saying it is a good idea, right? It may be a bad idea when you look at, like, we all contribute to the infrastructure, right? Like, we all want the roads. We all want to go around the lake. We all want to participate in the lake. We want to, you know what I mean? So just because I have more impervious surface doesn't mean that I'm necessarily, in my view, maybe contributing more Even I'll say a single family home from 20 years ago might have the same impervious surface as my home now. But, you know, some of these new complexes, like not all impervious surfaces created equal because I have like, you know, a lot of these new homes have seven feet between houses. Right. And I don't care that that's seven feet, like not that much water is sinking into that ground. It's going somewhere else. Right. So, yeah. I don't want to put some undue burden on the wrong people. There are unintended consequences of my question or my request. And so it's just a request to say, hey, what does this look like? And then we can see if it makes sense or not.

And just one thing on your train of thought on that when it comes to impervious services. multifamily dwellings have a lot more vehicles sitting on those imperial or on those surfaces. So a lot more oil drippage, that type of things, which have a direct reflection based upon the number of vehicles driving on it, the number of vehicles parked on it compared to a single family home, which granted we seem to have more teens with cars these days than we did many years ago. But it's quite a contrast, the number of vehicles sitting on that surface. when it's multifamily versus single family.

That becomes a big onion to your point. That's what I'm saying.

It can get really deep.

25, 30 years ago, we weren't putting three houses on an 8,000 square foot lot like we are now, right? We didn't make those exceptions. We didn't do that stuff, right? So now if you're going to be more dense, meaning you're going to cram more homes onto a lot, what normally would support three houses, you've got 12 houses there, right? That's going to increase the capacity of stormwater runoff. Is that fair to say?

Yeah, I think so. I think an important note is it's not just tied to the property that is paying the fee. It's also the utility maintains all of the stormwater infrastructure. So it's all of the surfaces of the roads, the curb gutters, catch basins, all the things. And so it is a bit – it might be confusing for the fee and the way it's set up if you really tied it hard to the impervious surface in that way. Does that make – so – but it's not a bad idea. It's an interesting like pull the thread and see what it is and see what it does. But it is – it's not apples to apples in that way. Yeah.

Yeah. And I don't want to make it complex. Like you don't need some messy formula. It takes, we can't have 10 tiers and what about this? And what about that? Like you can't go there. I get it.

Yeah. The other thing I'd like to point out on this topic and I want to be respectful of time, but is the biggest rate payers, the school district.

Well, which means us because we're paying the school district. whatever it is to do stuff like that.

For capital, but they just pay, they're the biggest rate payer. So we're going to come back to you. We'll talk about this and I have a good feeling they'll be at a future meeting to talk about it as well.

So, sorry, last thing, one thing, Shannon, based on something you said that might be helpful, at least to me. So if I look at slide 20 now, same one with the green bar, If we get that yellow line up to the top of the column there, that is we're not setting aside any extra money for capital projects. We're effectively breaking even. Is that correct? Anything above that column is money we can sock away for capital projects. I would be curious to know, of the projects you mentioned that we know are coming up, ballpark costs, what is that gap we want to try and close? How far above the column do we need to get this line over how many years to be able to afford the things that we know are coming?

Yeah, that's a great question and that's a great segue into when we bring those draft rates and we will look at the capital projects that we know we have and we'll look at what does it take to fund those with the rates.

Okay, thank you. Anything else on this topic?

I'm glad we're not paying any debt interest according to this chart. That's good. It's there if you zoom way. Is it way in there?

Tiny, but it's there. Wow.

Very small, low interest.

We did just sign up for well. Just a couple weeks ago, a month ago, whatever we did say we would apply for a 20 year loan, which would have some debt connected to it. We are considering absorbing some.

All right. Thank you, counsel. And thank you, Shannon. Complex and in-depth.

Thank you. Good questions.

All right. Our last item agenda or agenda item is Sarah with our parks department report. Sarah.

Thank you, Council. Sarah Garso, Parks and Recreation Department, bringing you a department report today. I won't read through all of it, but I'll touch on some of the highlights and then turn it over if you have any questions. I wanted to point out revenue generation. After Council approval to bring in new revenue items and benefits, basically new rentable items for the public. The Lakeside Shelter has had 26 rentals, which has brought in $5,850 plus technology fees. That has been since June up until last week with four reservations that are pre-booked for future filling. Oak Hill has been less popular. We've had three rentals, but a lot of this is marketing and getting the word out. We still hear a lot of people don't know that these facilities are available. Going into spring next year, we'll probably increase some signage on site in order to get the foot traffic to see more people. get that spread through the community. The other thing we did was bring in the self-serve kiosk for paddle boards and kayaks. That was installed in late May. There were only 13 rentals in May. But as you look at June and July, we're still waiting for August numbers to come in. But we've had a total of 324 rentals out of that kiosk, bringing in just over $1,000 back to the city as we receive 10% of their revenues. So overall, those programs are doing well for just being released over the last few months. A playground update, I had sent a email out to all of council to let you know about Sarita's Playground, which is the two to five year old playground at Lundeen Park. One of the platforms at that location has been secured and is shut off for the public. That was due to the crack in the public. We are keeping a really close eye on the playground and have increased inspections. The playground itself is 19 years old. Commercial playgrounds in public settings like ours typically last only 20 years. And factors that go into that are how heavily they're used, how much they're maintained, and that maintenance includes tightening nuts and bolts over their lifespan as well, tighten them as soon as they get loose instead of waiting for reports to come in. Some weather factors such as sun exposure can also contribute to that. So this has seen its full life at this point. The manufacturer has also stopped making parts. They don't even have the molds to put them back into production to create additional parts for this. The structure overall is aged and we've been watching it for a while, increasing safety inspections there. we anticipate we will need to fully depreciate this and schedule it for removal here in the fall. So we're keeping an eye on it. We want to keep it open as long as we can for the public, while it's safe, of course. With that, we will be looking at a fundraising campaign and grant opportunities for its replacement. Playgrounds are really loved by the community, and often we can secure sponsors, especially through daycares, private preschools, healthcare industry, as well as a handful of grants. So more to come on that topic. For playgrounds as a whole, the park supervisor has evaluated all of our playgrounds through the system as we realized they were not on our replacement schedule for capital. With that, we'll be integrating it into the updated 16 and 20 year plans. as we continue through this year. So we'll keep track of them and ensure we're planning future replacements so that we're not removing playgrounds without having secure funding and a plan for them. I gave a update on each of our capital projects. The two that are the largest and impact the public the most are the ones that are under construction or going to be under construction. And so that's Frontier Heights Phase 2. That is coming to a substantial completion in the next couple of weeks. However, the grass still needs to be established because it was recently planted, I believe just last week. And we also need to get the landscaping installed. That includes irrigation and all of the plans for the sensory garden. So we are working on that right now. That landscaping piece hasn't yet gone out to bid. So we will either be doing that this fall or coming back in to do that in the spring. And we're looking at the most cost effective way to do that and looking at our options now. As far as we're concerned as a parks department, it doesn't make too big of a difference if we do it in fall versus spring. The difference is we wouldn't have to manually water all of the plants if we do it in fall versus spring. But it won't impact the ground or cost more money to do it one or the other. So we're making the best decision based on timeline and weather. Of course, we don't want to be planting in December as that's too late. The other one is the Davies Beach Pier resurfacing project. Bid has been completed. We have selected our contractor, and we're gathering all of the requirements in order to get into contracting with them. From there, they are looking to order the exact material that we need, specifically the see-through decking that we have for light transparency, and we'll be working on actual dates that the work will occur, which is likely to be here in September. That entire dock, the pier, will be shut down to the public during that So we are starting with signage on site now to let people know it's an age infrastructure that signage is being updated as soon as we have anticipated dates for closure so that the public's aware. Good news is we made it past Labor Day for the public through the summer. The other thing I have as a topic is just future items that the Parks Department is working on to bring to Council. There are two that I did not list here in this Council packet. One of those is that the Parks Department is working with the Planning and Community Development Department to update codes for signage and so Lake Stevens municipal code chapter 14 has all of the text for signage, and what we're doing is looking for exceptions in the code for the parks department to allow us to have sponsorship signs in parks. Ball fields and sports fields commonly have advertising around the outside of those fences to help generate revenue. And we're also looking at wording to ensure that we can have some promotional signage on site for contracted concessions. So for instance, the kiosk for paddleboard, right now they can't have a sign in the park without getting a permit from the city. Since it's under the blanket of parks, we're going to make that easier and look at it. Of course, we're not looking to completely commercialize parks or plaster it with advertising, but a natural balance that you would see and expect to have at parks. Other items on City Council topics to come forward is looping back around regarding the Cavalero Park, the RFP that was put out for community recreation and sports complex. That was a failed solicitation, and we'll bring that forward in a topic to dive into. how it was bid out, the solicitations received, and what a successful one would look at, and then look to pivot as what's the next steps for the city as far as a community center goes. So that is coming back soon. We'll have the modifications to the in-kind contribution program. This will establish decision deadlines. So we'll have an application deadline, a decision deadline, and then a budget for that as previously requested by council. We will be bringing two topics forward for the mill. One of them is for increasing usage for community and youth focused programming here at the mill. The other one will be for the policy update we just discussed in last council meeting regarding cancellations, refunds, and adding language for fatalities and serious injuries, and also staggering timeframes for diminishing refunds. We also have an update to the park service level operations maintenance standards that'll include all of the parks that we maintain. As you remember, we had taken over the locations previously overseen by HOAs that are owned by the city. So we'll make sure that is complete in there. And we'll also be bringing discussions about parks revenue and specifically updating the parks impact fee. The biggest change that will occur with the parks impact fee is with RCW updates. We do have to update our rates as soon as the PROS plan was adopted. We have a time frame in order to get that through. But there was also a language change in RCW that has us charge the impact fees either on bedroom count or square footage. We're unable to say single family or multifamily residence. And so we're working on that language now, and we'll be bringing it back to make sure that we are compliant with the law. Are there any questions or discussion?

I just have a quick question just for general knowledge. The two to five playground at Lundeen, what's a general replacement cost for something like that?

The best answer I can give you is we are anticipating around $75,000 to replace it. And that would be for purchasing the structure and installing it. However, it ties greatly into the size of playground. The $75,000 that we're estimating at this time would be a similar size structure.

Comparable. Exactly. Thank you.

Yeah. Is the lakeside shelter, is that the one on Lending that we just made available? That used to be like a kind of a concession stand. That is correct. And 26 rentals just this summer, the first summer it was available. Correct. That is correct. Yes. Just huge success up till now.

Huge success. Good job. Thank you. And more importantly, it's a service to the citizens.

And yes, it was something that was wanted, obviously. Absolutely. Good job. Whoever's thought of that. That was a great thinking outside the box. I like it.

Team effort.

I'll pass it on.

Thank you.

Is there any reason why you need to start the Davies Pier resurfacing and shut down Davies Beach prior to end of September kind of thing? I mean, when are you, like next Thursday, it's still going to be 78 degrees projected, right? So I think there's still a lot of appetite, even though there's school in session to still be boating. And I'm concerned about shutting down half of our boat launches prematurely.

So to isolate this, it's going to be only the wooden pier that is a U-shape. The boat launch as well as the docks for boating remain open. The grassed area can remain open and the toilets can remain open. The actual swim area as well as that U-shaped wood is what is being replaced and is the direct work area. Now, to be clear, we still don't have a contract today with the contractor. And after we get the contract is when he would reasonably order materials. Contractors typically don't start racking up bills before that is. And they were they were having an original sourcing issue and delaying getting materials. And so although we're anticipating this to be September, I can rephrase that to say late September. And that would be if all the dominoes fall correctly. It could very well be into October.

Thank you.

You're welcome. We also agree we did not want it shut down during heavy use season.

All right. Thank you, Sarah. Thank you. There isn't a good of the order, but we're at the end of our agenda. Are there motions?