City Council - Regular Meeting

Thanks, mayor.

Good evening, everybody, and welcome to the North End City Council meeting for 02/17/2026. Will the clerk please call roll?

Mayor pro tem Errol Tremolotta? Here. Council member Brendan Elwood?

Present.

Council member Mark Jocelyn? Present. Council member Heather Cullen? Here. Council member Rob McFarland?

Here.

Council member Christine Arrestic?

Present.

Council member Susan Torgerson? Here. All are present, your honor.

Thank you so much. Will council member Rustic please lead us in the flag salute? Thank you, council member, for that. Welcome, everybody. Good evening once again. Mayor Pro Tem Tremolano. Will you please make the motion to approve tonight's agenda?

Motion to approve agenda for 02/17/2026 as presented.

Thank you, sir. Do I have a second? Second. Thank you. Motion by miss mister Tremolano and second by miss Rustic. All in favor?

Aye. Aye.

Any opposed? Motion passes unanimously. Thank you very much. Before we move well, we're gonna move on to consent agenda. But before we move on any further, counsel, does anyone wish to pull an item from the consent agenda, for debate? Seeing no one, let's take a vote. Motion, let's take that vote. All in favor?

Your honor.

Oh, yep.

I move approval of tonight's consent agenda.

Thank you, Vicky. Second. Thank you. Motion by mister Johnson, second by mister,

Brendan Ellwood. All in favor?

Aye.

Thank you. Thank you. That is, moving forward going unanimously. Audience participation, if there's anyone wishing to speak on an item that's on our agenda tonight or not an item that's not on our agenda, you're welcome to come to the podium at this time. Please state your name and spell your last name for the clerk if you don't mind, and you have three minutes to speak. Thank you, George. Welcome. First.

George Anderson, a n d e r s o n, 1360 Southwest 13th Place. I'm just commenting on the presentation last week or the last meeting from FCS on the water and sewer rates and just expressing a little concern that nobody seemed to be a little concerned that the water rates now are approximately 10% higher than our next highest priced municipality, Sammamish, and we're looking at raising that more. So we will be 16% higher than our neighbors in Snoqualmie. I understand that we have to be able to afford the water and past decisions that have been made, whether it's on the storage processing or other, water things. But it does seem to me with the discussions that have been had on making more affordable living arrangements and things like that, it really starts eating into it when you have to spend $70 a month more for water than a family would in Issaquah.

And that's pretty much it.

Thank you, George. Anybody else wish to speak?

Okay. Hi, Patty. Welcome.

Oh, no. We're not scary.

Hi. I'm Patty Pitcher, and I live at 8323 Moon Valley Road. And I just wanted to encourage you guys to think about expanding the tree street tree program here. We used to live in New England, and there was a really huge difference in the quality of life in the towns that had really big beautiful street trees and the ones that didn't. And the towns themselves were just much more vibrant.

The community life was really incredible. And I know that we've been planning there's little trees and things will grow, but I think that it's kind of like, now is the time to do it with it's pretty clear that the federal government is not gonna come through with good climate change programs, and street trees really, really affect climate issues in a lot of ways. And I could tell you all the million reasons why they're good, but I wrote up a little thing that I was gonna give you. And I didn't know that all you people would be here too, so I didn't bring enough. Know?

They only brought enough for that. But I just wanted to, like, ask you to imagine what it's like to live in a town where when you get outside, there's big beautiful trees and you're walking down. In the summer, the trees shade you, and it just feels really good in your body. And then in the winter, it helps with the wind, which is a really significant thing in North Bend. And then in the fall with the color you know, if you plant the right trees, you can have really beautiful color.

And since so many of our businesses rely on people coming in to you know, it's just gonna make North Bend a much more enjoyable place to be. So and it's not actually that expensive to do street trees, and you can create neighborhood programs where you make the trees available and then, you know, streets actually come together and plant together and take over the care of them and stuff like that if you're creative about it. So, anyways, I just wanted to encourage you to

do that. Thank you, Patty. I hate speaking with. Sorry. Did great. Did great.

Come come back again.

So these are all the.

A

lot of maple, a lot of elm, but then the elm died, and they they have a lot of different ones. We we actually lived in the town that didn't have the street trees, and our our whole town, like, basically dried up. So

Anybody else wish to speak

tonight? No. Good evening. Welcome.

Hi.

My name is Nicola Overstreat, o v e r s t r e e t, and I live at 704 Southeast 11th. I also wanted to comment on the water and sewer, rate increases. I do really appreciate the effort that went into making them as low as possible. But with our proposed rates being the highest of our surrounding cities, I I actually worry the most about the sort of outsized impact that utility rate increases have on lower income households. We hopefully, a lot of the households in our community will feel the increase pretty marginally, but it's particularly those that already spend most of their earnings on, you know, housing costs and essentials that will feel it more acutely.

And, you know, back in back in 2023, our housing needs assessment showed that a lot of our low income households are cost burdened and do spend a significant portion of their earnings on just being able to live here. And that affordability issue affects all of us because it means that, you know, businesses struggle to find employees because potential employees can't afford to live here. So, yeah, the the thing that concerns me the most is really the disproportionate impact that rate increases have. And the sewer and water fee schedules already break out, you know, discounted rates for seniors and low income housing units and different rates for multifamily complexes. But those building types are all getting a 28% increase in monthly water costs between 2025 and 2030, which, again, on a monthly basis, like, that cost might seem incremental.

But to a family that's already struggling, that 28% increase could be very significant. So I encourage you to think about the disproportionality of that impact, and I encourage you to think about ways to mitigate it.

Thanks. Thank you very much. Anybody else? Anybody online?

Yes. We have Michael Thomas.

Okay. I'll give him a sec here. Michael, are you with us?

I'm present. Can you hear

me? Excellent. You're on.

Yes. Michael Thomas. Come and spell it. Last name, t h m a s. 1231 La Forest Drive, S E.

I had sent in comment on two items on this to the agenda, one of which was the work with WSB, formerly Golder, but also on the public hearing. I'm gonna reserve my comments with respect to the water rate for the hearing, and we'll try to differentiate these as much as possible. One of the things is these items are actually related. I feel it's prudent for, the water rate benefits such as the reduction in mitigation payments. So actually wait for the analysis from WSP and any of the regulatory approvals that might be associated with that.

There's certainly certainly the benefits of that. I can understand why people might be exploring that. I am concerned that the that you need to wait for this the results of the study to quantify the benefits here. I am supportive of the work with WSP, with changes. One of the things I think that needs to be done is include 2025 in the analysis, given that was the first year of the Intertie.

And also, 2025 was a was a rough year. It's very important that we include both good and bad years, and I do appreciate council's observation last meeting of the difficulty of the snowpack. Two other items that are, very important are, and it's an exclusion of this of WSP study is, I feel an analysis of the changes to SP management of Chester Morse are needed. Their aim is posed in SP's 2019 water system plan that would affect that both good and negative ways, and particularly, Hobo Springs and the Snoqualmie River itself given the seepage influences both of those. That's a key key item.

And further dialogue with SPU on the management strategy of Chester Morris and its impact to, Hope Springs and the recorded mitigation that we currently have as well as, this work item proposed to change the mitigation strategy, which may involve substantial, regulatory review. And that's of that's of concern. A few comments on the study itself is, I'm concerned with, approvals for changing the position of Solol Wells to a primary supplier or first selected, and then Hobo Springs to secondary. I'm also, concerned about cases of extreme drought, low flow that if you use the water first for cost savings purposes, are you gonna have them for when it's dry or when you have low flow? That really is is troublesome.

And I believe some of these studies may be embodied in the work with WSP. So, again, I feel this work with WSP is very important. I endorse it with some changes, but I feel that the water rate setting is premature. I know I'm down to my last few ten seconds, I reserve further comments on the, on this matter at the public hearing for the water rates. Thank you. This concludes my comment.

Thank you very much, Michael. Anybody else online wish to speak at this time?

Not at this time.

Okay. Excellent. Thank you very much. We're gonna move on to announcements, presentations, and appointments. And guess what? We got the proclamation for Twin Peaks day. Let me begin. Whereas the television show Twin Peaks created by Mark Frost and David Lynch debuted in 1990 and changed television forever by breaking new ground and inspiring numerous other television shows. And whereas Twin Peaks returned to television again in 2017, challenging viewers anew and garnering awards and critical acclaim. And whereas Twin Peaks captivated television viewers worldwide with scenes filmed in North Bend and the Snoqualmie Valley that emphasize the natural beauty and history of our region.

And whereas Twin Peaks has drawn tourists year round to North Bend, the Snoqualmie Valley, and the greater Seattle area for more than thirty five years. And whereas Twin Peaks has placed many North Bend and Snoqualmie Valley locations, landmarks, and businesses into popular culture, not limited to Tweets Cafe, the North Bend Theater, Volition Brewing, EJ Roberts Park, the Mount Sai Motel, Snoqualmie Falls, Mount Sai, O'Lalley State Park, the Salish Lodge and Spa, the Snoqualmie Lumber Mill and Dirtfish Rally School, and the Roadhouse Restaurant and Inn. And whereas, February 24 is celebrated by Twin Peaks fans worldwide as the day when the character of FBI special agent Dale Cooper arrived in the town of Twin Peaks. Now, therefore, I, Mary Miller, mayor, do your by proclaim Tuesday, 02/24/2026 as Twin Peaks Day in the city of North Bend and call upon all citizens to join in the celebration throughout the Snoqualmie Valley with doughnuts, cherry pie, and a darn fine cup of coffee. That never gets old for me.

Congratulations. Okay. Would, Carl, would you like to come up to the podium and say anything? I am I putting you on the spot? I I guess I put you on the spot.

I'm always happy to just come and say thank you. This is the ninth year that that North Bend has done an official Twin Peaks Day. It's been a wonderful partnership. My goal was to improve the perception of the fans that the Valley was welcoming to them, and I can see in these nine years the changes it's made. And so I just appreciate once again your willingness to do this.

I'm very happy to. Thank you for being here. I think we're gonna have a photo op. And if people aren't aware online, we've got the welcome, to Twin Peaks sign out in our lobby area, and we'll walk out there after I do one photoshoot with the proclamation to Carl, and then we'll walk out with the Downtown Foundation executive director, Jessica Self. And we got a couple more people who like to be in the picture, I'm sure. Dory, would you like to be in the picture for Yeah. Yeah. Okay. Let's go. Okay. Everybody will be right back.

Freaking about for a little bit.

Yeah. Guys wanna be in the shop too,

of course?

Yeah. That's awesome. Perfect.

We'll just do this. Get over here. Sorry,

Brie. Oh, she's got

the shirt. Get in here. She has a shirt.

Takes a good while. Oh, sorry.

Should've taken very much for you. Nice. You guys. Guys. One

more. And then I just. Smiles right here is good. Yes. I'll turn it on for over here. Everybody's in the staff is

all coming. Same group? Okay. Perfect. Let's go.

Thank you for waiting and having a little pause in the moment. We're gonna move on to commission and committee reports. Let's start with, council member Torgerson community and economic development, please. Sure.

Let me find my paperwork. No. All nice and organized.

There it is. I knew

it was here. Okay. So, actually, today, we had, our community and economic development committee meeting, today at 4PM. We started off with a report from the Snow Valley Chamber, gave us a lot of updates on what's going on in both Snoqualmie as well as North Bend. Then we went on to talk about the planning commission work plan for 2026, and we're gonna be bringing that to council in the future.

We also talked about the binding site plan amendments, which are basically by some state senate bill fifty six eleven requires that we have a binding site plans be available for dividing properties, and, basically, the purpose is to make it easier for, people to to split their lots. Maybe they wanna add a ADU. Then we talked about the North Bend municipal code twenty zero eight amendments, efficiency, economic development, and equity consideration amendments. These amendments, are gonna be coming to us at either March 3 or March 17 council meeting. And then we also discussed, a motion for authorizing professional services agreement amendment for Facet Northwest for on calls consulting services.

That's for landscaping complaints with city code. And then, we also talked about the January 2026 activities report for CED in which James gave us a lot of, nice little updates about what's going on in our community. Our next meeting, I believe, is March 17, 04:00.

Thank you very much. Moving on to finance and administration and east side fire and rescue. Council member Rustic, please.

Yes. Thank you. Start with finance and administration committee met on, Tuesday, February 3 and had a pretty lengthy agenda again, but we talked about, the agreement with King County for receipt and use of parks property tax levy funds, and this item was approved as recommended. The second item was a year end 2025 citywide financial status report where we had a brief discussion, but no action was taken. Third was the twenty twenty seven, twenty twenty eight biennial budget development planning calendar.

The committee, asked staff to revise the calendar and add two midyear 2026 budget work work study sessions for the council. So just ahead of heads up to the council, give us more chance to take a look at that, biennial budget. Number four was the King County Sheriff's Office I ILA in transition update. And then number five, financial reports, citywide revenue manual, and CIP budget reporting worksheet. Number six was to talk about the 2026, f and a planning calendar.

And then finally, we did have a walk on agenda item to talk about the 2026 salary schedule, which was on a last council member last council's agenda. So that was it for f and a. And then, Eastside Fire and Rescue met, excuse me, this last Thursday, February 12. There was a oath of office taken by deputy director Angie Baird, so they've had quite a few new team members join. And so she filled the final position, which was great to meet her.

We held annual elections for the east side fire and rescue chair and vice chair, received updates on some of the activities that the the board for or the, yeah, east side fire board, they had just recently had an off-site and, set their plans for, the 2026 year. And no surprise, the majority of the item will be around the budget and budget, items that will support their biennial budget. So I will, excuse me, bring those back to the council as it progresses throughout the year. Other than that, it was that was about it. So thank you.

Thank you very much. Let's see. Transportation public works. Council member Collin, please.

Yeah. We last met on January 27 at 04:00 in our council room. Number one on our agenda was to confirm TPW committee monthly meeting day and time, which we are switching to 3PM versus 4PM. Number two, Don Deberg gave us a monthly update on the number six on Meadowbrook Sewer Ullead project, which is quite lengthy. Number three, Tom Moore gave us a monthly update on S R 202 shared use trail project.

Number four, mister Tom Moore gave us a resolution accepting TIB grant funds for the 2026 sidewalk gaps project. Number five, Tom Moore, resolution accepting TIB grant funds for the 2026 overlay project. So lots of grant funds, which is awesome. Number six, Tom Moore motion authorizing a design service contract with PH Consulting for 2026 pavement overlay project. Again, great projects for helping our roads.

Number seven, Donda Berg, motion authorizing purchase of replacement service truck with state contract because we have really outdated truck fleets, which maybe nobody knew. But they were really old, and we need to update them. Number eight, Don Deberg. Motion authorizing purchase of, oh, the pick pickup trucks with state contract, which we have to go through, apparently. So we're gonna get a Ford f one fifty and two Ford f two fifties that were in really poor condition.

So that will be great. That will help our public it will help our service. Number nine, Tom Moore authorizing professional service contract with GNO for stormwater management plan update. And number 10, Dondeburg motion authorizing professional services contract with GNO for design of ACE hardware water meter replacement. Oh, sheesh.

I keep going. Number 11, Don DeBurg. Motion authorizing professional services contract with WSP to update the city's water mitigation operation and monitoring plan. And finally, number 12, Dondberg, Motion authorizing work order with Gray and Osborne to prepare and design report for the South Forklift Station rehabilitation. And that is it, your honor.

Thank you so much. Council member, work stay, mayor pro tem, doctor Molada. Yes.

Sorry.

My notes.

Can you jump me for a second?

Well, your honor, we we passed the public health and safety, so my colleague would Yes.

Go for that.

Well, let's go Let's go back to very important public health and safety. My goodness.

Okay. My apologies. Council member Brendan Elwood was absent that day. He had some other things he needed to take care. So I volunteered to take his spot as chair.

So, on February 3, we met, and we, had some guests. Our guests were King County sheriff office sergeant Paul, King County sheriff office contracting manager Christensen, and King County sheriff office chief Chang. And, we started off with a briefing from King County. We had, the city finance director, Shaw, provide us with a presentation about the proposed ILA, and then later it was presented at the council meeting that day. We had a fire update from Eastside Fire and Rescue, interim deputy chief of operations.

Justin Walker provided us with the following updates. The monthly report on calls for service in December, staffing and training and fleet updates, leadership team retreat and legislative day, Fire District 38 meeting with city of North Bend regarding sustainable fire service, finishing the 2025 annual report and preparing for audits, Turnout time, rig check, and inspection improvements, prefile fire plans were discussed. Uniform policy and EFR branding, disaster inventory supplies and life pack fifteens, 30,000 k Department of Natural Resources, DNR grant is secured in additional grant submissions. And, he also spoke about mobile integrated health core. And then we received a police update from interim chief, Horaci, provided the following updates about monthly report on calls for service in December, reports on incidents of interest, and, upcoming transition with the King County Sheriff's Office, and then concerns about regarding, legislative bills for homelessness.

Our city administrator, Emory, provided the following updates, the fire district thirty eight meeting with City of North Bend regarding sustainable fire service. She's to bring information from the meeting to a future public's health and safety committee meeting. Motels in North Bend and Snoqualmie are being sold. Local nonprofit Reclaim relies on these accommodations for their motel voucher program, and then, Reclaim executive director Kirk to present a at a future city council meeting regarding these issues. Future agenda topics were shared, and then, we ended the meeting at 5PM. Our next public health and safety meeting is gonna be on March 3 at 4PM.

Thank you so much, council member. I'm gonna make one slight correction. I think I said I did say work study. I meant, council retreat. So mayor pro tem help from Aleta. Yes. Away.

So we had our council retreat on Tuesday, February 10 up at the Snoqualmie Inn in the Falls Conference Room. This was a lengthy but productive, about five hour retreat with all council in attendance as well as staff. We reviewed quite a few items on our sort of visioning exercises and shared future. And by the way, there's an updated document in your inboxes, if you haven't seen this evening, from our facilitator, Una. Working on how council can work together, our our individual visions of where the city should be, not only in the near term, but the long term, and, a continuing working document, which we will move forward with in the next thirty to sixty days.

We're populating in a in a a second date to have a follow-up works excuse me, retreat. Part two, to hone in on more of the tactical part of, that visioning exercise.

Thank

you very much for that. Planning commission, parks commission, economic development, mister Henderson, please take it away.

Great. Hi. Pardon me. Good evening, mayor and council members. The planning commission met on February 4 for two agenda items.

First was a hearing and recommendation of approval on amendments to the city's binding site plan regulations to address the state requirement that binding site plans may be made available for use with property zoned multifamily residential. Second was a hearing and recommendation of approval on amendments to comprehensive plan and development regulation amendment procedures that criteria for future staff reports such as permitting efficiency, fiscal, and cultural resources to support planning commission and council decision making. The planning commission will next meet on March 4 for a briefing about content neutrality, supreme court case law, and how that could pertain to our future signed regulations. The Parks Commission met on January 28 and discussed scoping for amendments to the park element of the comprehensive plan, including perspective amendments to the park's capital facility elements, comments received from the Snoqualmie tribe, and finally, amendments needed in consideration of an update to the park's impact fee rate study being performed by the city's consultant, Bowman. The parks commission also reviewed and provided comments on revisions to the draft plans for the Ballarat Plaza project being coordinated by public works and the city's consultant site workshop.

The Parks Commission will next meet in March and will discuss draft amendments to the park element as well as their findings of a reconnaissance exercise they will be conducting around the city to prepare recommendations for future pedestrian and bicycle wayfinding signage improvements. The economic development commission met on January 22 to discuss and finalize their top 10 priorities for 2026, which focused on mountain town character, outdoor recreation, creative arts, and support for local businesses. The North Bend and Sokomi Economic Development Commissions will hold a joint meeting to actually tomorrow on February 18 where they will each discuss their top priorities and identify priorities that they can jointly work on in 2026. And finally, on February 11, the mayor and city staff hosted a commissioner appreciation dinner to recognize and thank the members of the Planning Commission, Economic Development Commission, and Parks Commission for all their volunteer time and efforts over the last year in advancing staff, advising staff in council, and making North Bend a terrific place. Thank you.

Excellent. Okay. Moving on to regional committee reports. Anybody on council have anything you wish to offer tonight? Mister Dusson?

Thank you, your honor. The Sound Cities Association public issues committee met virtually on February 11. Prior to the meeting, there was a presentation by Malou Chavez, the executive director of the Northwest Immigrant Rights Project. It was very well attended. It was very informative.

They provide free legal services, which is just a remarkable thing. Malou shared a presentation on defending and advancing immigrant rights in a shifting legal landscape. The presentation covered the history and work of the Northwest Immigrant Rights Project, the current landscape of heightened immigration enforcement and its impact to communities, what individuals can do if at risk of deportation, and what local governments can do to protect communities. So I will share that presentation out and perhaps make sure that it gets sent to council. It was the first meeting of the year.

The meeting in January was canceled. There is a new chair of the pick committee, Lydia SF Dawson. The executive director, Robert Feldstein, talked about the fact that there's significant turnover. There's 62 new faces that are elected officials in SCA cities and 17 new mayors, which is nearly half. So then it was agenda setting, talking about IRE's issues of interest and concern to neighboring cities to sort of set an agenda going forward for the staff who are incredibly helpful and well informed.

Issues that were mentioned, land use regulations, affordable housing, economic development, human services, surveillance and privacy related to flock and ring cameras, impact of AI and technology, criminal justice sales tax, which is an issue of interest to us, and it's impacting our our city and the ability to access those funds, flood response and emergency management, of course, given events that we all live through here. I think that covers, the most of it. It was just, issue setting and looking forward. The next meeting will be held, March 11, and that will be in person only. Thank you.

Good council member Joslyn. Any other, committee regional committee reports to share tonight? Council? No? Okay. Let us move on to our main agenda. Item number six, public hearing ordinance amending taxes, rates, and fees schedule regarding water utility rates. Mister Chaw, I turn it over to you. And thank you.

Thank you, mayor. For the record, Martin Chaw, finance director. But before you tonight are items six and seven. It's a public hearing or continuation of public hearing for the ordinance amending water rates and ordinance amending sewer rates. I do have a short presentation for you to summarizing our discussion from last week.

Again, these two ordinances would adjust water and sewer rates through 2030. The objectives of these rates is to ensure financial sustainability for the for both utilities, maintaining a quality drinking water and services to the community, as well as maintaining our compliance with debt covenants, as well as the city's, positive double a minus credit rating, for the utilities. This item was advertised for public hearing on on the January 23, was reviewed by TPW, in November, f and a on January 13, and then, again, last at our previous meeting, first reading and opening for public hearing, and then tonight for the second final reading.

Any clarifying questions for

Well, I still have a few more slides to go, Mir. Sorry. My computer's a little bit slow here. So in terms of the history of rate adjustments council, this slide here shows water and sewer rate adjustments going back to the year 2021. As you can see for water adjustments, it was about 2.4% in 2021, then five and a half percents per year through '25.

And then for this rate study, six and a half percent starting in '26 through year through the year 2030. For the sea utility, it's a 2.4% to 2.5% between the years '2 2021 through 2026, and then 3% for the years '27 through 2030. When we think about the water utility council, there are really two primary sources of revenue for the for each utility. One is what's called general facility charges. So these would be onetime charges assessed on new customers connecting to each utility.

What this graphic shows, the top graphic compares the actual GFC collections for the years 2021 through 2025 and the projected GFC collections for the years 2021 through 2030. And, again, this this timeline encompasses both rate studies, the one prepared in 2021 and the one prepared now in 2025. Obviously, a a forecast is simply that. It's a forecast, and it's difficult to predict what would happen year to year. But as you can see on the bottom graphic, our consultants were fairly accurate in terms of forecasting what the actual collections would be for the first five years of the study period.

And as you can see on the blue chart where the where the left left hand side of the bottom graphic, we have about 3,100,000.0 of actual GFC revenues collected and about about 3,100,000.0 in terms of what was projected. For the CERG GFCs, we have similar graphics here, again, showing the GFC revenue collections as well as projections between '21 and 2030. And as you can see on this graphic, we've collected an actual amount of 7,500,000.0 versus about 5,500,000.0 in terms of the rate study forecast. Service charges, and these are would be the rates paid by customers for for daily operations of each utility. For the water utility, as you can see, the forecasted rate to revenues were fairly predictive of the actual revenues coming in between the years 2021 to 2025.

And as you can see on the bottom graphic there, 12,700,000.0 in terms of actual revenues collected versus 12,900,000.0 in terms of what was forecasted. For the sewer utility, again, a similar graphic where the forecasted line of revenue collections were fairly predictive of the actual revenues that came in with actual revenues during the five first five year period of about 30,400,000.0 excuse me, 20,400,000.0 versus the rate study forecast of of just just over 20,000,000. So this is the last slide of my presentation. I know there were questions about comparability with other jurisdictions. I can pull those slides up if you wish for the water or sewer as well as the combined utility.

But what I wanted to do with these slides here is to just share with you the performance, the financial performance of the water and sewer utility, its GFCs, as well as its rate revenues.

Thank you, mister Cha. Counsel, do you have any clarifying questions for mister Cha? Mister mister McFarland?

Only me. I've got a number, and thank you for the presentation, Martin. I I knew you could get there. I I wanted to say I was somewhat comforted by the GFC data and felt in keeping with the rate increases and everything else that was going on. I I was curious how you interpret that data, though, if you have what your view particularly, of course, the spikes.

Sure. Absolutely. In in in the world of financial planning council member, it's important to remember that while while a forecast goes year to year, you know, we're trying to predict what would happen from one year to the next. The goal of of of a financial plan is is to forecast what our resources are over a particular window. For example, like a five or six year window and how those resources would align to the forecasted expenses over that same period.

And the goal of the of of a financial forecast then is to is to forecast with some level of certainty that that the organization will have sufficient revenues over that window to cover the expenses over that same period. So when we we reviewed the data here for the water and sewer GFCs, what this showed us is that while it's difficult to predict the timing of individual development projects that would bring in GFC revenues from year to year, the the forecast of actual GFC revenues over that five year window was fairly close. So that gave me confidence in in that the work of the consultants were were solid. The information that the city provided to the consultants for the basis of forecast was was also solid. And then finally, you know, the consultants that we use, you know, they they work on this with many other jurisdictions.

So they they've had an opportunity to really fine tune their methodology. So so the, you know, the review of the GFC revenues in the first two slides, councilman, as well as the rate revenue on this on this on the last two slides were really kinda give me confidence that that we're on the right track for our rate studies covering the period going up through 2030.

Yeah. That's great. Thank you. You know, as I looked at the rate increases and differential between water and sewer, occurred to me that some might be confused by the water rates seemingly going up so much faster than the sewer, particularly in that we've just built a multimillion dollar sewer plant, and that would seem to say that's where a lot more revenue would be needed. Can you comment to why you feel that the water rates are outstripping sewer in the need for revenue?

Sure. So in in Washington State laws, each utility is required to operate as an independent business enterprise. So in other words, the the utility business for governments is as close as one can come to a private entity, and that the revenue from rates must be sufficient to pay for the expenses of the of the business without any subsidy from general taxes. So the water utility and the sewer utility are each tested as independent businesses. So while the layperson may look at what was happening in the sewer utility and the rate increases that we needed there to finance the wastewater treatment plant expansion.

Those monies that we collect for sewer utility operations can only be used for sewer utility needs. And, similarly, revenues that we collect for the water utility and what and water rates can only be used for water operations.

Great. Is there anything in particular that happened in the water system that that you feel that drove the need for increasing those rates at a higher clip than sewer? I'm I I'm struggling to myself understand that one.

And I think the answer to that, councilman, is I I think the when we take a look back at the previous rate study, the best I can describe it is that the previous rate study and the previous several years of the city budget was refocused on ensuring that the sewer utility was operating was really operating optimally. And that's why we constructed the wastewater treatment plant and made the made those upgrades to to that facility. For this rate study, we returned our attention to the water utility. And as I mentioned at our last at our previous meeting that the initial analysis by the rate consultants indicated a much higher need for a rate increase for the water utility. And what we did was was there were several things.

Number one, we staff felt that that would be unacceptable to the community. So we worked with the consultant to revise this the capital improvement plan for the water utility. And as a result, we pushed many of the larger projects towards the back half of this of the study period. So the study period being 2026 through 2030. So those larger projects got pushed out into the latter years of that window.

And that enabled the the city the ability to buy down, so to speak, the the trajectory for the water rate adjustments to to what's being proposed for you tonight, council. Thank you.

Mayor, I've got two more questions, but I'm happy to yield momentarily.

Sir, anybody else on council? Let's start with Brendan, and we'll go move on to Heather and then Christina. Thank you for that.

Thank you. Just one question that was probably explained at the last meeting, and I've heard it before. I just think it'd be great to hear it again. When we start comparing our costs in North Bend with other more established communities, one of the things that I think we have to look at is a lot of our infrastructure is new. And so I'm wondering if you could just weigh in a little bit on when we have an established infrastructure and we're just paying for maintenance is kinda one thing. The sewer is where it is. It's always been there. Those rates are there. Water is where it is. Here in North Bend, because we have new development, new growth, We have to have new plumbing, and we have today's rates to pay for that.

So how much of an influence or factor do you think our costs are influenced by the simple fact that we are growing at a time when we're growing? For example, if we didn't have an eleven year moratorium, water moratorium, a couple dozen years ago, we would have been growing at the same rate of other neighboring communities. We'd have different infrastructure in place, but we've had to play catch up, so to speak. Then when you look at other bigger issues like COVID, the push for population, people leaving Bellevue, Seattle, Kirkland, and moving out this way. So now we have, population pressures, which are new.

We have to keep up pace for that. We have real estate dollars in value. North Bend real estate is a high premium. Landowners that were sitting on it for twenty years now want to capitalize on that and start building on it. But now we have new infrastructure growth. So I just I know that's a lot of, like, commentary in a question, but but I also think it it's helpful, at least for me, to to bite the bullet on some of these things, knowing that we're playing catch up, and some of those newer costs are associated with at a time point in time for the city of North Bend historically. Now we're having to pay for those new infrastructure costs. So I'm just wondering if you could weigh in a little bit on that.

One of the defining features, councilman, of public utilities is is the infrastructure and the replacement of of aging infrastructure. One of the most apparent examples of that for me in public policy was and this is just as an illustration councilman is for the City Of Manhattan over in New York. Several years ago, they had to replace one of three major water mains that feeds the city of Manhattan. And the engineering challenge there was to figure out a way to shut down one water main and keep and have two water mains feed the entire city while that one was being replaced. I use that as an example of of the challenges here within North Bend where, yes, we're a growing community.

Yes. Some of our infrastructure is new. But in order to pay for that new infrastructure, the per the one of the major funding sources of that is general facility charges. So there's an alignment there. There's a nexus between GFCs and and growth related projects.

The other aspect is maintaining our utility. So as the utility system expands, as the as the pipe system ages, we need to stay in front of that and maintain and replace the aging infrastructure as needed. As shown on this graphic here on let me reshare my screen. As shown in this graphic here, councilman, the presentation that we had presented last week with the with FCS for the for the six year planning period for the water utility, As you can see on the on the text box on the upper left, the major projects coming in during the six year window is or or two major water main replacements on 428th Avenue as well as the Middle Fork and South Fork segments. And those are valued at almost $4,000,000.

And just to provide give you a sense as to what that means, Our utility, it's the water utility business is a $3,000,000 a year business. That $3,000,000 has to go towards operations Mhmm. The water mitigation payments, the the maintenance as as well as the the replacement as well and the construction of projects. So so that's one of the key drivers of the of the water CIP. On the CIRI CIP and excuse me.

There's a similar graphic here for the CEERCIP. As you can see, there's an outlier in 2028, and that reflects the searing Silver Creek project. As you can see, the outsized value of that at twenty three million dollars. Now a a layperson might look at that and wonder, well, wait a minute. Why if there's such an expensive project in one year, how are we able to maintain a a a rate trajectory of only two and a half percent, right, for the serial utility?

And the answer to that is that within the serial utility, we we have a fairly healthy fund balance. So the so the fund balance over time is being drawn down to finance these scheduled projects for the for the sea utility.

If I may, because this slide is up, I just wanna bring attention to the fact that there's $224,800,000.0 in grant funding identified there that's coming into our city that's in addition to rates collected by from residents. I think that's a significant number.

Yes. Thank you for that reminder, councilman. Great notation.

Yeah. Because the $22,000,000 to put that on the backs of folks in Silver Creek doesn't make sense, but I remember we did have that grant to help fund that. But I also think it's important to note that the more sewer pipe you lay, it it lends itself for more residential development. And that is one of the cons with with expansion of the sewer system is you have more residential growth. So balance balancing those budgets with the community needs is a big deal.

But thank you for that, Martin. I just wanted to get that clarification. And then also just highlight the original point that you made, which is funding payments for the utilities specifically go to those funds. I've had a a resident question where some of the monies are going for those sewer rates. If, for example, I think it's like 30, maybe 35% of the community is on septic, they don't pay sewer because they're on septic, but there are different tax. They're taxed for their stormwater but not sewer, whereas somebody who's on sewer is also taxed on sewer and stormwater. But those monies that are being paid for those utility bills go to those funds specifically. Correct?

Yep. Yeah. And just to clarify, councilman, the 6% city utility tax is only applied on water services and sewer services

Right.

And and and not in the storm. Yeah.

Thank you for that clarification. And those tax and just real quick while I have you. So the the taxes that are on top of those services, the 6%, where do those tax dollars go? Is it into those funds directly?

Those the revenue from from that utility tax, that 6% utility tax, goes to the general fund.

That goes into the general fund. Okay. And I think that was the the the concern that this resident was expressing to me is that tax revenue from from sewer goes into the general fund, and those people that are on septic don't pay their fair share of sales tax that goes into the general fund. But that could be a sidebar comment. I just wanted to bring that up because I respected the individual's point of view in reaching out. Thank you.

Thank you, mister Elwood. Miss Cullen.

Brendan took my question, and he did it much more eloquently than myself. But I'm wondering and I know it's apples and oranges, but in comparison to cities of similar size, where are we at?

So good question, councilwoman. Let me point you through this one slide here, which is the combined utility billing for a single family residential customer. The stack bar in the far right, the second to the last, is is the combined utility billing for North Bend under existing rates or twenty twenty five rates. And the proposed would be the adjusted rates for against stormwater, sewer, and and water.

So to add to that, why do we have to raise that quickly compared to the other cities?

So there's a couple of answers to that, councilman. So first of all, comparing ourselves to another city for utility services is a little bit difficult in that their operations could be a little bit different from ours. So for example, we have a wastewater treatment plant, whereas these other cities some of these other cities may not. We also have the challenge of, for example, when we go back to the to the survey graphics on the water and sewer CIP, we have those AC water main prep projects coming up in 2030 and the Silver Creek project in about 2028, although that is a majority of that is being grant funded. We also have the debt service associated with the wastewater treatment plant that was constructed, and we're still paying debt service on that.

And sorry to add to that. So the other cities don't have to pay for their sewage waste plants? They

they get a free ride?

No. It's not a free ride. Cities that are hooked up to, for example, King County Metro will pay a metro wastewater treatment charge, and that shows up on their bill, and it's a separate billing from King County for for sewer services. So for those cities, let's say Bellevue, Redmond, Issaquah, those cities have conveyed their wastewater to King County for treatment. So those cities the residents in those cities receive a separate billing for sewer services.

The billings that you that you see here are only for the city side of services. And I do have Sergei Terasov online from FCS, and he can help assist his firm works with so many other jurisdictions. He can probably provide a little bit more color on the pro the operating profile of other jurisdictions compared to ours.

Yeah. I can offer a couple comments if you'd like, Martin.

Oh, yes. Go ahead.

Typically, again, it's as we always say, it's a little bit of an apples and oranges comparison when we look at the costs for other utilities because, again, we're not responsible. We don't know what their policy objectives are, what their infrastructure life cycles are, and, just policy on on deferred maintenance. We know a lot of utilities are choosing to maintain versus replace, and get and be proactive. Others are, the opposite. If you have recently replaced the treatment plan project, post COVID timelines, post the pandemic, costs have been skyrocketing magn magnitude fold over 200% in some instances specifically for that type of infrastructure cost.

So the utilities that just due to the life cycle of their infrastructure haven't had to address those needs yet are have not had to, incur those larger costs. You know, we work with utilities that had an estimate for a treatment plant that was 11,000,000 ten years ago. Now they're actually paying 30,000,000. So it's all about timing of when these costs are incurred. Magnitude of scale as well.

Economies of scale is a big factor. You have your own treatment plan, as Martin indicated, for your community. Others are purchasing wholesale treatment. And based on some of the draft forecast and forecast that King County is an example treatment has released, they're forecasting double digit increases in their King County treatment costs due to the regulatory requirements that are being put on them, for many years to come, more than five years, maybe even ten years plus. So many other utilities are facing these issues.

Your timing of the adjustments for the sitting of spend, you just went through a replacement of your infrastructure for a fairly small in terms of city number of populations versus other communities have more people to more businesses, more communities to spread similar costs through. So it's just kind of the the general differential between the the cost.

I think we have I do have a question, but if yours is related to that comment, go ahead.

Sergei, I appreciate your time. You presented to us in a work study, and at that time, you suggested that of these 11 cities we see listed here, a number of them may currently be going through a similar process of look reevaluating and likely are also going to be facing increases in their utility rates. Do do you have any idea how many of these other cities are currently engaged in a similar process?

Me, personally, I have worked with maybe half of the utilities on the list, and I know several of my colleagues have also, worked or working on several studies. We're fine you know, we finalized a couple of those studies, which have or have not published them. Again, this presentation was developed a little bit ago. It doesn't we don't update it before every single meeting, so we would have to double check if they posted their rates, more recently, if they've updated their rate schedules yet or not. But, me personally, I've worked with quite a few of these, utilities, and they all have, done a study last year or the year before and have a multiyear rate strategy in place.

Thank you, Sergei. Thank you, mister Johnson. And, Rustic, I think you're next.

Thank you. Most of my questions were already, addressed, and I appreciate that. But what resources are available for any residents that may need additional assistance with utility bills? Can you touch on that, please?

Sure. So within the city of North Bend, we have the low income and senior discount for income qualified account holders. They can find more information on the city's website, or if they can contact the the finance department, we'll be happy to send them information on that. But that provides for a 50% discount to their to their utility bill. The in addition to that, there there are other resources available through other organizations to assist with with utility bills.

For example, HopeLink, the regional human services provider, they offer assistance for energy assistance through the federal low income home energy assistance program. And that program provides assistance towards paying for energy bills through, for example, put to sound energy.

Miss Torquerson?

Yeah. In looking at this table of all the different cities, do we know what the comparison is? Like, for example, is it a a three fourth inch meter, or, like, do we know what they're all comparing to each other?

Yes. They're all being compared using a five eighths inch residential meter.

Five eighths? Okay.

And 20 cubic meters of water usage per month, which is a fairly typical water usage for a for for purse four person household. Okay. Thank you, miss Cohen.

To add to council member Rustic's question, To get the 50% discount, which you said residents would need to know to go to the city, and is there a lot of hoops that they would have to jump through to get that discount?

Oh, it's a it's an annual application, and the resident just needs to provide proof of household income. So it'll be tax return information if they qualify for a discounted property tax billing from King County, for example. The information they provide to the county as part of that can also be used for for the city's program.

And to add to that, how do we get the word out to the citizens that this is a potential possibility for them?

We do advertise this on the city's website. We our our staff shares that with with residents when they call for when they call with questions or asking for assistance on on if they're expressing difficulty in terms of paying for the utility bill, our our staff know to direct residents towards that program.

I think we've haven't heard from Merrill or pro tem. K. Mister McFarlane.

I think

I should have her yielded the floor. Sergei, I'm rather shocked that you can't dynamically update this chart that's up on the board right in front of us as as the others set their rates. Yeah. But but beyond that, I think it's it's interesting information through a couple of decades of watching similar charts go up when we're in these conversations around rates. It always occurs to me that it's it's a it's a plus and a minus because we all are curious, well, how do we compare?

But at the end of the day, it doesn't matter because it's only about the revenue that we need to cover our bill. And so sometimes this chart seems to be a disservice to us. So sorry I had to make that comment. On the 50% and the discount, so I hope that at least annually it's also going out in the bill to make sure that all residents are aware of it. And is that a sliding scale, or is it a you either qualify or you don't?

It's either you qualify or

you don't. K. Thank you. Okay. Then just two more questions that I had originally.

That's fine.

So I was looking at the GFC chart that you shared a little while ago and and the spike that we obviously see, I assume that was driven heavily by, I guess, the other council members mentioned the COVID effect. I remember when COVID hit, we were actually thought we were gonna go into the toilet on collections and on on revenue, and instead it spiked. And so we saw from '21 that that start to jump and you know, through '23, and then it dove, which I think is kind of the almost natural. Right? Do you attribute that to COVID, or do you think there is something else going?

I don't know if it was due to COVID councilman. I do know that GFCs are very sensitive to development development activities. So to the extent that the city is able to keep future rate adjustments in check, one of the ways to do that is to ensure that we have sufficient revenues coming in through the GFCs through new development to pay for new infrastructure. Because otherwise, the the existing customers would be would be born solely with that responsibility.

Yeah. So so I think you kind of alluded to it and answered my colleague who's pointing out correctly that the, yeah, the GFC driven by growth and how do we balance that. We build a plant to absorb the growth. Now we gotta fund the growth to pay for the plant, that kind of a thing that we're always dealing with. I seem to recall that that in the first few years of the twenties, the city had a backlog of permitted projects in the neighborhood of, like, 500, 600 units, which is what I assume a lot of that spike absorbed.

And I believe I saw in a recent community economic development report that we're now down to maybe something like 75, a 100 in backlog. It seems fortunate in one way that we have that backlog that could be absorbed and drive that revenue that we needed at that time, which helped put off the rates. I'm I'm curious. Are are you concerned about the rate of backlog not being there to support the GFCs going forward?

Sure. I'm a little concerned about that. You know, the the projection for future GFC revenues is dependent on new growth coming in. So to the extent that that that that new growth doesn't come in as, yeah, strongly as planned, then that would require us to go back and revisit some of the core assumptions, for the, for the present rate study.

Thank you. That's all.

Thank you very much. Okay. I think we've covered everybody. At this time, if, anyone from the public would like to speak to this agenda item, please come forward. Anybody online?

We have Michael Thomas online.

Okay. Thank you. Michael? Hi, Michael.

Can you hear me, counsel?

We can.

Can you hear me?

Yes.

Okay. Thank you. Michael Thomas. Common spelling, t h o a s for last name, 1231 La Forest Drive, S E. Thanks for the, update and discussion. But I do want to reiterate some of the comments I made in writing on the, on this rate study in the basis, and particularly in germane to water. I will also have remarks as a separate item on sewer. I believe that's point of process. It's a separate agenda item, and I may wanna make some remarks on sewer. On water, I already stated concerns that, there may be risks in, taking advantage of, changes to the order of mitigation water.

Again, that study, I think, is central to understanding that, and there are many items in it. The other item that I see central to this is, ecology and others, approving, the changes to this, mitigation and operations and monitoring plan. My apology for the earlier characterization of that. That also is essential, and I would be concerned that folks are taking a risk here, with that, rate reduction. I do sympathize with the increase in water rates from my fellow citizens, and and I'm very concerned by that.

A couple of things that did occur to me having deep understanding of this, and it's a question I didn't see addressed was in the past plans, it was envisioned, and I believe it's in the 2025 WSP draft, water system plan draft, that it was envisioned for Solol to purchase more water to support growth beyond what was exchanged by mitigation. How is that accounted for in the rate analysis? Again, for looking at growth for, you know, new connections, you know, so long needing to purchase water or purchase as envisioned could be a source of additional revenues. And that was something I didn't see, see see see asked or analyzed. To me, you know, this this is this is one item.

The point there being is, is, again, what's what's the impact of of those, of those I of those items? And, this concludes my comment really on on the water rate rate setting items again. There was one item I did want to mention. It was in passing in the two three hearing about a water system merger. I feel that, there are many issues that have to be addressed.

This is a quite charged issue, given the past history of the city acquiring and then threatening eminent domain and or condemnation of the Salal Association. As an item also for ratepayers in Salal, the city charges 50% more for those that are outside of the city. I don't know how items like that would be would be resolved. So I do wanna express some concerns. I think that might be something that, again, was perhaps an early remark, but it's certainly something that's, important to bring to the attention considering that, you know, affordability for water and sewer is a citywide issue, and it's not just, you know, one water system. We all pay for this together. This concludes my remarks on water. I would expect an opening also and comment on sewer. Thank you.

Thank you very much. I think that's it for online. Just confirming.

That's correct.

Thank you, sir. Well, we are gonna close the public hearing. Pardon me? Oh, so sorry, George.

I just My apologies. George

Anderson. No. 1660 Southwest 13th Place. Just one comment while we're looking at the rates of the different communities. And I know it was mentioned that it's hard to determine where their increases are gonna be. I did a quick Google on Snoqualmie. And last May, they announced that they are doing raises of their rates from 2025 to 2030. Are those numbers included in that chart that was presented?

No. The Snoqualmie rate that chart is a is a static point in time. It was from May 2025, though. Yes. It would be whatever the rates were published at that time, which was in in the last half of twenty twenty five.

Okay. So I would assume that that would be included?

It again, it would be whatever rates that they have published at that time, George. Okay.

Thanks, Mark.

Sorry. Yeah. But that's alright.

Thank you. I I hope I've got everybody who wishes to speak

tonight. Oh, come on up. Alright. One more.

You're welcome. Of course.

Yeah. Just on the on the assistance that's available for lower income households that, at least from what I remember, I think the threshold for combined income for that is something like 49,000 a year. So if someone in if a household is making, you know, 55 k, they won't qualify for that assistance and, frankly, would really struggle to live in North Bend and pay for housing costs and utilities even as a renter. So I don't know that the programs that we have in place go far enough to mitigate cost impacts for folks who don't meet that exact threshold. And, yeah, still encourage you to think about it.

Thanks. Thank you.

Okay. I think we'll now close public hearing. And, miss Rustic, I think this came through. Well, I know it came through. F and a. You'd to make the motion? Yes. Thank you.

Motion to approve a b 26 dash zero one nine, an ordinance increasing water utility rates and amending the taxes rates and fee schedule as a second and final rating.

Thank you. Do I have a second?

Second.

Oh, thank you. Motion by made by council member Rustic, second by mister McFarlane. Miss Rustic, would you like to add anything to your motion?

I'm losing my voice, so I don't think I have a whole lot to add. I I know that, this is a difficult challenge for residents. I also know that it's our job as council members and staff to maintain our water supply and ensure that, it remains safe. I know that when we have to make repairs, the costs are so much higher than what we would possibly anticipate, and we need to make sure that we continue to keep things operating properly. So with that, I will support this tonight. Thank you.

Thank you. Council member Farlin, would you like to add anything?

Thank you, mayor. I'm finding myself struggling with this one because by and large, I'm a realist, and these are the facts in front of us. And and not only do I believe them because of the reputation of the company that prepared them and our finance staff, but the increasing costs are are a reality. Yet I'm really struggling to support at where we are because they are pretty stiff. And so, you know, we've talked a bit about that, you know, it's an it's it's both unfortunate and fortunate that we look at that chart compared to other cities.

We know it's in flux. Other cities are moving up. Also, citizens that expressed their concerns for what that looked like against others, but ours is driven by our cost. And and they are driven by the choices that past councils have made as well. And I seem to recall, and I believe Martin alluded to this earlier this evening, that prior councils made somewhat of a choice that and potentially that was in the water more so than the sewer to hold down the increases during those times to smooth that transition to a degree.

And so some of this may in fact be feeling like, well, now it's catching up with us and we get to be the ones sitting here today. And I'm not I wanna be clear. I'm not accusing the prior counsel of any misdeed saying they made a very logical choice to be careful with the rate increase for other drivers. As has also been mentioned, there's several other factors that work into the rates. The the rate at which we grow, the rate at which we replace infrastructure that's worn out.

One of the slides that was up there looking at the worn out pipe going under the rivers, That's something that really, in my mind, I wanna pull it forward yet revenue to do so. Right? It's because that's those those, if I recall, are the two largest sources of leakage that we have right now that are that's costing us a lot of money just in water dripping back to the river, which is sometimes seen as a good thing, but in this regard, not so good. So that so there's that. Right?

So and then the conversation that came up, and and thank you for the council members that raised that about the discounts that are available. So there is there are other mechanisms, and that's really, I guess, what I'm wanting to share with my council members and the public is it's not only about this rate. And particularly when it comes to those in need, as was mentioned, maybe we need to be reevaluating what the threshold is. Maybe there needs to be more of a graduated threshold. Maybe there's more that we can do within a graduation between 50% and not.

I don't know what those look like, but I'm suggesting that for those of that need that, that's something that this council should be looking at harder versus a yes or a no. And I'll get off the soapbox.

Thanks. Thank you, council member McFarlane. Anybody else in council wish to add anything to this? Mister Jocelyn?

Thank you. I appreciate all the good conversation and discussion and efforts on behalf of staff, the FCS as well. I appreciate the public coming forward to share their thoughts. This is a tough one. It's not what any of us would hope, and yet it is, I believe, firmly based in reality in a realistic look.

Enterprise funds won the way they do. They have to pay for themselves, you know, and they can't be commingled or crossed up. It costs money to run a system like this. I do want to point out that in the water utility financial plan, 26% of the expenditures go to capital improvements over six years through 2030. That's a significant number.

That's a big deal. That's not just operations, and it's best to maintain systems. Deferred maintenance is gonna, you know, bite you in the backside in the end if you don't pay attention to it. And so as with so many things, I believe this study and this council is trying hard to strike a balance on this. I'm totally supportive of this notion.

I I mean, I wanna speak to cost burdened households. It's not insignificant, and I don't think that's lost on any of us here, that these decisions that we make impact people's lives, especially folks on fixed incomes who are cost burdened. I want to share council members McFarlane's commitment essentially to look at ways to mitigate impacts, whether we graduate the scale, raise the threshold. I'm interested in digging into that and seeing what approaches this council might take to, again, do something to bring down or diminish the impacts on those most in need in our community. With that said, I will be voting in support of this this evening even though I wish that weren't true.

Thank you.

Thank you. I'll take a look one more look around. Mister Trevalada.

Yeah. I didn't have any questions, but I guess I'll have a comment. There's the comparisons are well noted, but, you know, council member Jocelyn and I sat on an SCA call at sometime q three, q four of last year, and the large discussion about King County sewer and water rates and the futures of that, and it was very bleak, far bleaker than some of the tough numbers that we saw. So I think, and council member Ellwood makes some good points, about sort of, for lack of a better word, bringing this town into the twenty first century in terms of infrastructure and what that front investment costs. I think, these increases are what they are for where we are today.

I would caution council that although I'll support this, I don't want this to be a Band Aid for the future. I think there's tough decisions ahead. I think growth is one one proponent of it, but I think there's also utility users and and other areas where we can look at incorporating them. A one water system, which I've spoke to since I showed up at council is it makes no sense to have two water systems in this town. It will never make sense from an economic development standpoint, and we are going to hit a tipping point at some point where this is never going to make sense.

And it's either gonna be the burden of the taxpayers of the city of North Bend, or it's gonna be the greater North Bend community figuring this out together and how we solve for that. So I don't know that, you know, adding GFCs to to soften the blower is the only answer. It's part of the answer. I think there's unincorporated expansion in in UGA, bigger picture items. We have we've talked about it on various issues that there are folks on either side of the river and up on the ridge that or, excuse me, on Wilderness Rim that are members of our community.

They're our neighbors. They're every day in our community, but we have separate financial investments and and in, responsibilities that just make no sense for a town of our size. That is something that's a much more complex problem to solve, but I would hope this council embraces that challenge so that we aren't necessarily doing what a council of twenty years ago may have done, which is sort of Band Aid until next year or Band Aid until that next sewer water rate increase is here. I I know coming off of our visioning exercise and the retreat, it was very big picture. It was very five, ten years ahead.

And so some of those conversations are are frankly ones that I think we need to have. Otherwise, we will find ourselves in this position in eighteen, twenty four months all over again, and we'll just we'll look at what it was changed and, you know, did we get a new business here? Did we get a the new business here? But the the rates are going one way. The cost and operating expenses are going one way, and that's not a North Bend specific problem. Right? That's King County. That's Western Washington. I mean, those are all all the desirable places in the in the country that are facing these issues among with others. So I'll support it.

It's a tough pill to swallow. No doubt. And I all the notes thank you for council member McFarlane and Jocelyn noting that, you know, I think we certainly should be looking at how to how to help the the folks that are gonna struggle with this and and opening new routes and and maybe refocusing the the limits on on those those vouchers or what have we for the for the help there, a 100%. But I just want our council to acknowledge that this is a long term problem that we should be discussing and not just a simple rate increase for next year. So appreciate it.

Thank you. Anybody else? Miss Torgerson?

I I reiterate everything that councilmember Tramalauda just said. I have the same thoughts what, mister McFarlane stated regarding our organization that created these numbers for us. I think they could have updated it. I think the numbers are misleading. I think Redmond is at 250 for 2026.

I think I read online somewhere. And, yeah, I've been hearing a lot as well, with King County, and and their rates significantly have been increased. And it's been in the news, and it's it's distressing. And I feel like we're blessed that we have our own wastewater treatment center, that it's not going up like it is in in those other cities. So in in I think that it would have been nice to have to see the numbers being been updated for the other cities.

Yeah. I'm I'm gonna be supporting it, and I like, I don't want to either because it's it's very it's tough to all of us are struggling with finances. I do wanna also reiterate what other council members are saying is we need to to work on the policy and and on the, it's called our low income senior and low income disabled utility discount application. I think that we need to re review that policy in our finance and administration committee. So I should put that on there and update that accordingly, but I agree with my what my other council members are saying.

Miss Cullen? Just one more thing. We we have had our costs increase on our police services, on our fire services, now our water and sewer services, and it just doesn't seem like it's letting up. And the prices of everything, including groceries, whatever it is, going up, up, up. And it it just seems it's exhausting. That's all I have to say.

Thank you. Mister Elwood.

Thank you, your honor. It's interesting hearing my colleagues here talk because I I'm hearing, despite the bullet, just approve it, but I'm also hearing we need more exploration. We need sharper pencils. And I appreciate, what was done on the CIP and to kinda shift things around to to assume some of those costs. So just a question real quick, Martin.

When thinking about factoring in new updated data from other rate studies that could be happening that were post this analysis and other creative avenues because I'm sure you and your team looked quite deeply at how we could really sharpen the pencils for a minute. And I'm not talking about households that are under a certain MCAD. I'm just talking generally speaking here. What more benefit would you see in having other data from other neighboring cities, number one, brought into the fold? I mean, one, it just gives me more of a comparable rate.

Like, are we apples to apples and whatever? How would you use those data, those insights? But two, what are areas that you see that could be opportunities to sharpen our pencils? Because one of my concerns here is we approve it, and then we forget about it. We set it and forget it. That seems to be councils whatever council it is, that just we have so much on the work agenda. There's so many things that we have to pump through. The state is constantly churning all these different things. So we our attention is very we have a limited amount of time to attend to important things, but this is another one of those important things that we need to spend the time to do. So my big concern is that we'll approve it.

We swallow the poison pill tonight because it's something we have to do, and maybe that's another question. What is our actual shot clock on this? And then we forget it. And I don't wanna forget it. So I'm just wondering just right now off the cuff live, and I apologize because I don't wanna spring questions on you and put you in a theoretical discussion, but at the same time, as I'm hearing all my colleagues here echoing the same sentiment, which is we need to do it. We have to move forward with our community. These are just things that we have to do to pay for the cost of where we are today in the city of North Bend, but we wanna do more to find better savings, better better cost efficiencies, if you will, for residents. So do you mind just responding to that very long winded question?

Well, sure. Absolutely. No. No. No problem. So three part question. So the first one on the interjurisdictional comparisons, councilman. Certainly, we can bring in additional data from other jurisdictions, what their current billing is, whether they're under a whether they're conducting a current rate study and where that's pointed. In the at the end of the day, as councilman McFernan mentioned, this the rate study is really financing our business. Right.

Right? So the anecdotal information from another jurisdiction may be may be illuminating as to what's happening there, but it really doesn't help us. But but that said, we'll be happy I'll be happy to work with Sergei, update that comparative slide, and bring that back to you. In terms of tools to mitigate the rate increases, it's a it's a level of service question, councilman. So going back to the utility slide or or for the water utility, where we were looking at high value a couple of high value projects being pushed out to the end of the forecast period.

And as you recall, I think at the last meeting, I also mentioned to you that or maybe this was discussed at FNA, that within the water utility, there's a within rate study, there's a plan to bring in one additional FTE to assist with catching up with deferred system maintenance. We can certainly take a look at that and, for example, not approve that additional staff person. And I believe the back of the envelope calculation that we made was that it would buy down the rate increase for sewer I mean, for water by about 1%. So instead of six and a half percent, it's five and a half percent. We could take a look at the water projects at the end of the 2030 planning period and whether or not those are really needed at that time, or can they be pushed out a couple years further.

And, you know, the the goal being to reduce the slope of that rate to trajectory. Like, the the slope of that line currently being six and a half percent and decreasing that.

We can certainly take a look

at some of those. The caution I have, councilman, is on pages twenty four and fifty four, if you rate packet, we have a six year financial plan for each utility. So on page 24, for example, we have a six year financial plan for the water utility. And the key metric here, councilman, is if you take a look at the beginning fund balance in '20 at in January 2026 and the ending fund balance as of 12/31/2030, we're driving down that cash balance from 1,900,000.0 to half $1,000,000. And this is with a six and a half percent rate adjustment.

Right? So if we decrease that slope of that line, then what may come back is we would drive down the fund balance even further unless we we cut costs. For the serial utility on page 54, you know, we start off with a $14,000,000 fund balance, and we we're driving that down to about 5,700,000.0. Now it's an from my comments earlier, we we cannot have resources cross lines. Right?

So we couldn't use part of that 5,700,000.0 and push that over to the water utility and try to help subsidize operations in the in in water operations. So there's a there's a balancing act of level of service, of the needs of the maintenance needs of the of each utility and as well as the capital needs. And if that's something that council you wish us to explore, I'll be I'll be happy to. The other tact that we could take, counsel, is you tell us, what's acceptable in terms of a percent rate increase. So for example, if a two and a half percent rate increase for is fine, but a six and a half percent for water is not, but I'll make a number out.

But a 5% increase would would be acceptable, then let us know that. And I can go back to staff you know, to Don's group, to Sergei, and then we'll come back to you with a scenario as to what we would have to cut to stay within that 5% ceiling. And in terms of your third question on timeline, the ordinance approves rates through 2030. There's no there's no rule that you have to adopt rates for that period. We staff proposed adopting rates for that window to coincide with the rate study that we have.

But, certainly, you can council can adopt a rate schedule for one year, two years, and then we come back and we check-in with you after that twenty four month period, for example, and and see where we're at and and tweak rates as needed for years three and four, for example. So we kinda hopscotch the way through the the study period. So there are tools, but it but the last the the latter two would yield the most probably the most information for as an alternative for counsel.

Thank you. Because as I'm thinking through what council member Colin pointed out is the total share of wallet. Right? Like, how many what is every household having to spend? We're we have our police services. We have sales tax. We have cost of goods. I mean, there's so many things hitting at once. What are those controllable levers that we can really dig in on and maybe not Mhmm. Do radical increases for long term, but just do some manipulation over time?

Don't wanna get into the trap of deferred maintenance because I've been on this council long enough to kind of experience that that sour taste as well. But what I'm hearing from you is that there is opportunity here to actually do a little bit more exploring. But I would need to understand what are the trade offs of those explorations and just volley it to my colleagues is that would that even be worthwhile pursuit if we explore this further because we're not up against the specific shot clock. We can look at the scheduling of this and break it over time as as our finance director just described. So I think there are levers that we can take a cautious step forward while we actually refine the point that we need to get to, but understanding full well what those trade offs are, especially if it's level of service and and so forth.

And you were gonna say something.

Sure. And I'll I'll put Don on the spot here. You know, the and it is a it is a question of trade offs. Like, the maintenance worker that's being proposed Mhmm. For deferred maintenance, the capital projects that that are being proposed. And if we push those out, what does it mean? So I might ask Don to respond to those.

Yeah. So excuse me. As far as the maintenance worker, right now, we're just grabbing a couple pieces of pieces of knowledge I've got in my head. Right now, we're about ten years behind on valve maintenance. So if we do have a water break or we have a need to shut down the specific section of line, Many of our valves don't fully seat, so we have to widen that shutdown there. So if we wanna shut down block because

Manhattan project that Martin just talked about a little while ago. Right? Sorry? The Manhattan project?

Yes. Exactly. We do keep up on our our blow offs, for example, because that that has an effect on water quality. One of the things that we're about three to four years behind on is air vac maintenance. So air vacs are little devices that release air out of the water pipes.

They're just kinda naturally built up in them. If those things malfunction, there's a couple things that could happen. One is it sticks open, lets bunch of water leak out. There's a significant water loss that could happen with that. If it sticks closed, then we're building a bigger and bigger bubble of air in there, which eventually that pipe is gonna airlock and unintentionally shut down a portion of town.

So those are a couple of things. Hydrant maintenance is another one. We're probably two to three years behind on hydrant maintenance. I don't think I need to speak to what happens if hydrant doesn't work. So as Martin alluded to earlier, that maintenance position, it's gonna it's intended to help us catch up on some of that deferred maintenance.

As far as the CIP projects, the the bulk of the money in the CIP is replacing aging infrastructure. So if I remember right, the average age of our pipes right now is about 45 to 50 years old. Many of those pipes were built in the fifties, sixties, seventies, and they're made of asbestos cement, which has a fifty year life cycle generally. So what we've been seeing is a lot of leakage through those older pipes. Our distribution system losses, since I've been here, have hovered anywhere between about 10% to about 30%.

So 10 to 30% of the water we produce is lost to leakage. So we we do need to get a handle on that. That's a lot of wasted money, one. Two, state law requires that three year rolling average for DSL be under 10%. If not, we need to have a water loss action plan to address that and bring that loss within the 10%. So, again, the bulk of our CIP is is to reduce that distribution system loss number.

Mister Tremlada?

I don't disagree where council member Elwood's going, but maybe I can offer maybe a strategy for us going forward. Martin, we're continuing to talk budget, you know, through the year and the planning going forward. Maybe I mean, I think inevitably, we're talking about an increase, whether it's this percentage proposed or there's like, to your point, we'll give you a number and we'll shrink. But maybe we can run scenarios as we move forward with the budget where we take this increase and flatline it, right, versus showing the increase and work that into the planning. Right? Because it's a little bit ripping the Band Aid off. Like, I I think we're gonna have an increase regardless. Right? But your point's well taken is it can't just be put on the shelf and forgotten about. But maybe if we envelope this into the budget planning going forward and say, look.

As a council, we we did it. We hit the increase. We'd like to avoid that moving forward. So how do we plan accordingly, whether it's economic development or other other items that we're pulling for? But let's keep water and sewer at this rate as we look at these different scenarios for five, six years out. I mean, if I I don't I think that's somewhat included in what we've discussed in the past as we've seen the increases, but and maybe it's an additional scenario planning that we could discuss that can maybe answer the concerns of council Narelle would have. What we don't wanna do is pass an increase and then be back passing another increase in a year or two.

Jocelyn?

Yeah. I know we've been on this for some time, and I appreciate the concerns. That are shared. At the same time, Don, I want to thank you for reaffirming to me the depth of the conversation that is already taking place in our agenda bill tonight. The guiding principles that were brought forward include maintaining current levels of service, maintain current financial self sufficiency, meet debt service coverage requirements, maintain minimum reserves, which are in fact being drawn down significantly if you look at the schedules that Martin cited, and maintaining utility AA credit rating, all of which seemed very worthwhile to me learning, you know, as I've heard before that the average age of our pipe is 45 to 50 years old, which is end of life made out of asbestos and cement, reinforces to me the necessity of the matter that's before us tonight, and I will continue to be in support.

Thank you.

Okay. Great. Alright. Let me get out of here.

Your honor? Yeah.

May I follow-up?

Yes. You may.

So and I respect that. And and I don't think that figuring out how to sharpen the pencil, figure out different schedule of of of of increases, or trying to understand different trade offs and what levers that we can pull deviate from those guiding principles. I I think those are still achievable with further analysis on this. And now I'm not saying kick this down the road. What I'm saying is I want a different firmer commitment from us as a body to continue this so we don't just approve it and then forget it.

I think council member Tramolata's point about rolling this into the budget talking budget cycling and thinking about that or just just reflecting on recent memory, all the work that we've done with the police services contract. You know, we started with this bucket. It's gonna cost this over time. We realized savings to get it down to here, and we're still exploring how to continue to make that that transition to the new police services economical for our residents in the best case scenario. So I don't know how to bake that in to this particular policy decision that we're making other than just say, yep.

We approve these rates, and now we're gonna move on to the next agenda item. So I would be open if legal counsel or if Martin would offer a suggestion here, but I do not want us to walk away from this. And just a dais promise that we're gonna continue to look at this is one thing, and I have no reason to doubt that my colleagues will not continue this this marching exploration, but I want something a little bit more firmer in the commitment. I think I think we had owed that to our residents.

Councilmember Elwood, if I can offer perhaps we add this to f and a as to add on to the calendar for the budget cycle piece. I know that's not baked into the to the motion, but that's something that we can definitely like we just did with another topic, we can bake that right in tonight and add that to f and a, and then that gets pushed through as far as our what our priorities are to talk through this year as as you mentioned to add it into the budget cycle. So we can definitely add that in right now and add it to the calendar so that without putting it into the motion itself.

Yeah. Yeah. And what I can add to that comment from Amber is, you know, for other jurisdictions that do approve, for example, a multiyear rate adjustment ordinance, that they would evaluate the the financial performance of the utility at at at certain mile posts. So for example, we would evaluate, for example, let's say, in November 2026. Hey. How are we performing relative to the forecast in the rate study? And is that a positive or negative variance? And why is that? Mhmm. And and does that mean that we can that the adjustment rate adjustment for 2027 can be tempered a little bit?

So we can we can certainly do that where we get on a cycle where we evaluate and do a deep dive on on the financial performance of each utility once every twelve months.

Well yeah. I think we spoke very well.

I I hate to continue the conversation because I know we've been at it for quite a while. So perhaps I can close out by assuring that I have combined my comments to talk about water and sewer collectively. So when we get to sewer, I'm not gonna have much to say if anything. So I wanna assure you of that verse. You know, as we're playing Jinga, and we all know we're playing Jinga, whatever we pull is gonna push something else. Right? And maybe the tower falls. As council member, we're like bookends here. Right? Because we we don't wanna lose sight of it.

But to be clear, I honestly came in tonight and even during this discussion was not sure, am I voting no? Am I abstaining? Or am I voting yes? But ultimately, I do think it is what we have before us. It is the right move.

We do and and therefore, I've changed I've I've landed that I am going to support it, but but I'm not discounting that the things that I want us to look at are things that could impact the future rate increase or if we got super lucky, maybe even a rate increase being approved tonight that's down the road a ways. Right? But for the most part, I gotta say, I don't believe we're gonna find that solution because I I understand very much so what's behind most of this. I'm hopeful And but some of the things that we can do, we we we may be able to have an impact. So I'm done.

Okay. Ready ready to make the motion. Motion to approve a b 20 dash zero one nine, an ordinance increasing water utility rates and amending the taxes, rates, and fees schedule as a second and final reading. All in favor? Aye. Any opposed? Motion passes unanimously. Thank you for the rigorous discussion. This is a heavy duty topic, and I appreciate it for this effort tonight. Gonna move on to, another public hearing continuing. Item number seven, ordinance amending taxes, rates, and fees schedule regarding sewer rate utility rates. Mister Chaw, once again, we look to your expertise. Thank you.

Thanks, mayor. My staff report, that I covered, earlier, covered this item as well, mayor. So all the guy all the principles, the strategies that we discussed of visiting the financial performance of the of the s of the water utility would apply also to the sewer utility. Great. So, again, I'll I'll be happy to to entertain further discussion on this on this utility, but everything I mentioned earlier would apply to this program as well.

Thank you, mister Chaw. Once more, we'll go around. If anyone's interested to add anything else.

Just just one.

Oh, here comes okay. Mister Elwood.

No. I I appreciate the discussion, and I think it's the right discussion. And I think decisions like this, we really should care less what the clock says. We need to have these open discussions. These are critical. We have residents. Each one of us probably can share anecdotes or two of people coming to you concerned about the total spend and the decisions that we're making here. And, sure, it may not impact me, but it may impact five or six other people, and I could be up here doing right by them. Yes. I can do it for the right by the city, higher order thinking, future thinking, but I don't wanna leave people behind in that decision making.

So I appreciate the dialogue that we're having and the commitment to continue the discussions and and see how those levers can over time. But the the one area that I also wanna place emphasis on to make sure it's on our calendar and schedule is the the subsidies for certain income level households. What are those levels that we can you know, is it a gradient scale as council member McFarlane suggested? You know, what what what can we do? What room do we have there?

What sort of grant monies are available? Are there certain tax funds that we can attribute to allowing us to accommodate certain subsidies? What is it that we can do in that Rubik's? Because these are gonna start adding on to a lot of our residents. And as we continue to talk about more workforce housing, affordable housing, yeah, maybe we can get some of those units to where we're getting with that level, but then to live here and reside here is gonna be impossible. So you can't build a place for somebody to come and live if they can't continue to reside. So these are the total expense that we have to be thinking about on all of these important decisions. So I didn't wanna lose sight of that because it was something that we started to talk about on the water and just wanna bring it back up so that it's top shelf, on agendas and priorities for us. Thank you.

Thank you, mister Elwood, one more time. Mister Tremolotta.

Yeah. I would just reiterate quickly what I said also that I I would like to have some dynamic scenario planning, Martin, as we go forward because in your points while taking council member, wouldn't I I do think we should explore that. But whether it's sliding scale or we we move the the limit to another number, there's you know, you make it $65,000. Somebody's making $70,000. They're gonna feel it just as bad, and they're not gonna qualify. It's always gonna be kind of that next group. So I wanna be dynamic in being able to look at at least the opportunity cost of discounts. So we're gonna say, look. We're done. We're flatlining.

What does it look like? What are we losing where do we have to pull other levers? And then at least consider that scenario. It may not be the scenario we we should take, but we should understand that because things like this will always be is there's gonna be fatigue. And to council member Collin's point, like, everything's becoming more expensive.

And so if we're just adding even 1 more dollar onto that bill, it's going to be affected for everyone. Obviously, there's groups that are gonna be more affected than others. But like I said, no matter where we move that bar, there's always gonna be people that are gonna struggle. And then, frankly, there's people that are well above those incomes that are just they have other costs that are associated. Maybe they have, you know, family members living with them or other you know, there's just a 101 different reasons why why this would apply pressure to those families. And so I I wanna make sure we're looking at the solution across all demographics while also being cognizant of those most in need. So if we could do that as we move forward with the budget, I think that would be good discussion.

K. I'll just I have one.

Miss Trusick, really quick. I'll just commit to and I've taken notes that finance committee will address some of these topics and bring it to the council for further consideration. Appreciate the suggestions.

Great. Good. K. Anyone from the public? I'm opening up to you if there's any interest. Okay. Anyone online tonight?

Yes. We have Michael Thomas again.

Okay. Michael, you're on again.

Good evening, counsel. Can you hear me?

Yes.

Okay. Great. Michael Thomas again. Common spelling, last name, t h m e s. 1231 La Forest.

It's very interesting listening to the com combined water and sewer rate discussion. I'm gonna limit my remarks to sewer given knowledge and some of this maybe questions. I recall in the, discussion for financing the sewer plant several years back that there was particular, target established for growth, and I believe that was in the neighborhood of 1,748 connections or residential connections. I am interested being a septic owner that, it does occur to me that an increase in GFCs could be a source of these of more people would be converting from septic to sewer. And one of your examples for that is, potentially Sewer Creek.

But my understanding of the Sewer Creek of the Solar Creek item is, is, frankly, that only pays the ULED or the, basically, pipes and lift stations. Again, I think people that facing that may be facing these kind of conversions will need assistance. The county's analysis, in participating in the, in the, septic code changes that that a a a sewer conversion was close to 90,000, whereas a septic replacement was 46,000. So I'm very concerned about the affordability for people facing these conversions. For folks in Silver Creek, perhaps they're lucky you're gonna have some subsidy, but I'm still concerned by the cost of the GFC, for these people as well as anyone else.

Also, the the monthly rates on on sewer are certainly higher, than septic. Again, again, I think people that need to look at, look at this issue overall is the people on septics also need assistance either for, supporting their existing septic system, and there is some assistance for the county for maintenance, but also for, sewer conversion and not just for Silver Creek. And that's a I think that's a key point, for all of us as we try to maintain our lower costs of, of living. Again, it would be good to get some insight as to where the, where we stand on growth of sewer connections with respect to paying for the existing sewer plant. I didn't see that.

And, again, I saw a source of that to be septic conversions, but there are parts of this of of the city that may never be within range of this. So, you know, that's another item. Finally, there was a comment about annexation earlier, and that would also apply to sewer. There are areas significantly outside city limits that have zero sewer, and, you know, what point does that outstrip the capacity of your existing sewer plant? So it's a kind of an open question that folks might ask is, well, if you're gonna start thinking about, you know, annexing, places that are currently still within the UJ with outside city limits, well, then how do you provide sewer for it?

Anyway, this concludes my comment. Again, I appreciate the long discussion, and, hopefully, there's some color as to where we stand on the on the, number of connections that support the GFC and also to express concerns about keeping our septic costs down for people that that have that have these and any conversion costs down as well and support for that and support for maintaining. Thank you. This concludes my comment.

Thank you, Michael. Okay. We will now close the, public hearing. And, miss Rustic, this came through FNA again. Would you please make the motion?

Yes. Thank you. Motion to approve a b 26 dash o two o, an ordinance increasing sewer utility rates and amending the taxes, rates, and fee schedule as a second and final reigning.

Thank you. Do we have a second?

Second.

Thank you. Motion by miss miss Rustic, a second by miss German McFarland. Miss Rustic, do

you have anything you'd like to add? I don't have anything additional to add. Thank you

so much. Mister McFarland, would you like to add another

comment? K.

Any other council wish to have one further comment? Or k. Oh, mister Jocelyn.

I believe council member Elwood attended the utility rate study, and I just wanted to reiterate the degree to which this issue is we are not alone in this. It's gotten and and has it's It's top of shelf, top of mind for almost every city. The projections in terms of the Brightwater Treatment Plant and what's going to be happening to sewer rates for those folks in King County who utilize that system is is really frightening. I wanna thank the folks who came before me who had the insight in spite of the challenges and financial commitments and even the concerns just raised by the public going forward, but that this city has its own wastewater treatment plan is is a big deal. Thank you.

Well, if I may just add, I'm really grateful that we did phase two when we did. I keep oh, yes. Correct. So with that, I'm gonna make the motion to approve a b 26 dash zero two zero in ordinance, increasing sewer utility rates, and amending the tax rates and fees schedule as a second and final reading. All in favor?

Aye. Aye. Any opposed?

Motion passes unanimously. Thank you again for the rigorous, conversation tonight. Okay. Item number eight, motion authorizing contract with WSP for mitigation operation and monitoring plan update. We're shifting gears slightly. Well, a bit. Let's drink the bird. It's time for you.

It is. Thank you, your honor and counsel. The water mitigation operations and monitoring plan is a relatively short document at about 41 pages long. It was originally developed in 2007 right before we started using the Centennial Well in 2009. The plan is referenced in the Centennial Well water right in several locations as kind of the the guidebook as to how to operate and how to mitigate.

And it describes the data that the city will monitor, the calculations used each day for calculating the daily water mitigation requirement, and how the city will report Centennial Well and mitigation water usage to ecology, the Snoqualmie tribe, the Tulalip tribe. The Centennial Well water right required the plan to be updated after the first two years of operation, which would have been 2011, and once every six years after that to coincide with water system plan updates, but it was never updated. So we are looking at our first update to this plan since since we began using this Centennial Well, and it's kind of an important plan. So, again, the plan's fairly short and simple, but there's a lot going on behind the curtain. There's a lot of analysis that needs to be done, a lot of modeling that needs to be done, a lot of calculations that need to be done to support this update.

So that's why the cost seems kind of excessive for a 41 page document. It's a lot of work to get the back end done before you can get this document written. So the, scope of work, the key items in the scope of work are to update the forecast report to reflect new data and assumptions to provide a current basis for the updated o and m and water system plans. Collecting and analyzing data from 2019, I know that the agenda bill says 2024. We are gonna look at 2025 data to update water and mitigation demand forecasting, leakage rates, and streamflow profiles.

That's a lot of the analysis that I just spoke about. Updating projections for Mount Sai Springs and Hobo Springs flows and evaluating the effectiveness of stream flow augmentation, otherwise known as mitigation, to understand the current mitigation capacity and efficiency. Forecast modeling has not been completed with Salal as the primary mitigation source, which, as you all are aware, that's kind of our plan going forward. So they're going to run several scenarios to understand the different operational strategies and how we can best optimize both mitigation sources to minimize cost to the city and coordinating the water system plan updates to ensure consistency and integration between the two plants. Upon completion of the draft, the plan will be sent to the Department of Ecology, the Snoqualmie tribe, and the Tulalip tribe for review.

Once they get their comments back to us, we'll need to address those and finalize it and adopt it here in house. So the firm that we've selected to prepare this update is WSP, formerly known as Golder Associates. They were very heavily involved in getting these Centennial Wildwater right. They did all of the modeling for the mitigation system way back in the day. Those same models are the ones that are gonna be updated for this effort.

And from my understanding, there's gonna be some work to get those models updated. So they really are the right people to to do this work. There's there's not a lot of catch up work for them to do to be able to hit the ground running on this, so we feel strongly that that they are the right firm. The anticipated cost is $165,000 that will come out of the water operations fund. This work was included in the rate study and is included in the 2026 budget. So with that, I will entertain any questions. Thank you.

Thank you, mister DeBerg. Counsel, do you have any questions clarifying questions? Miss Rustic? I

have to ask this question. I'm sorry. What you know, 2,007 was the last time it was updated. So what would happen if we don't do this?

At this point, actually, we have a draft version of comments from King County on our water system plan. This this particular plan was brought up in the draft comments for the water system plan. I know the Tulalip Drive and Snoqualmie Drive have both brought up updating this plan in the past as has ecology. I don't know what the regulatory repercussions would be if we choose not to do this. Operationally, this is, again, going to it's gonna guide our operations in the future to make the best use of both mitigation sources.

As part of the update, they're going to look at the mitigation algorithm to see if there's any modifications necessary that could result in a reduction of the mitigation requirement. So it could save us money over the long term. That's that's what the hope is.

Thank you. Yeah. Anybody else? Mister Tremolotta?

Yeah. The 165,000 from the water operations fund. Correct? What is that? You might have said it. Sorry. But what is that in context? What does that fund look like right now? When

you ask, councilman, what does that fund look like? You know, it's about a $3,000,000 a year business, so we bring in about 3,000,000 a year in rate revenue. So 165,000 is about I know. If I'm doing my math right, it's about 5%. Yeah. It's about, half a percent.

Jocelyn? I guess in the spirit of the current questioning, right, this is not money that's coming out of the general fund. This is money that's coming out of the enterprise fund, which as you just pointed out, it's a $3,000,000 a year fund. If anything, it might push down the rate increase that we just voted on, or somehow this $165,000 is rolled into that plan through 2030 that we just spent a good part of our evening having a conversation about. Is that correct?

No. Not quite. So, yes, we can take that $1.65, plow back into utility. But with the member councilman, it's a onetime expense. So I think if we wanted to impact the trajectory of the rate adjustments over time, we're really looking at looking for ongoing cost savings.

Thank you.

Great. Anybody else? Okay.

I

believe this came through TPW, miss Colon.

Sure.

Thank you. Motion to approve a B26Dash021 authorizing a professional service agreement with WSP to update the city's mitigation, operation, and monitoring plan in an amount not to exceed a $165,100 in a form and content approved by the city attorney. Do I have a second?

Second.

Thank you. Motion by, miss Colon and signed by mister McFarlane. Miss Colon, would you like to speak to your motion?

Thank

you. Mister McFarlane, care to

Just one comment. Yeah. I'm more than confident that we'll get significant input by interested and impacted parties when this draft is complete. So in that respect, I'm not concerned that we're jumping any guns in that respect. And and, of course, you were mentioning that it's quite overdue.

I think it's also fair to say that the system itself didn't change much for most of the history of this. And so in some ways, there wouldn't a lot perhaps that did need updated, so don't beat yourself up too bad, Don. However, that did change when the city reached agreement with Salal on the Intertie system. And so it is certainly overdue for an update now. And so I'll certainly be supporting.

I have a little bit before.

Sorry. It's cool.

It's okay. I am tired of kicking the can down the road. I think it's time that we do this. It's makes no sense to me that why we wouldn't, and that's what I have to say about that. Thank you very much. Anybody else

in council have any comments to make? Miss miss Rustic?

Yeah. I appreciate that, councilmember Cullen, and I merely asked the question just to review both sides of the this scenario, but I do plan to support this. Thank you.

Alright. I think we're ready. Motion to approve a B26Dash1021 authorizing professional services agreement with WSP to update the city's mitigation operation and monitoring plan in an amount not to exceed a $165,100 in a form of content approved by the city attorney. All in favor? Aye. Any any opposed? Motion cat carries unanimously. Thank you one and all. Moving on to our last agenda item, motion authorizing work order with GNO regarding self work lift station. Mister DeBerg, you're on again. Thank you again.

Yes. Thank you again, elected officials. So way back in the way back in 02/1617, we developed a plan called the wastewater system facilities plan. That took a holistic look at our sewer system and recommended several improvements to the system. Big one that we just completed was wastewater treatment plant, so now we're kinda looking out at the collection system.

So in that plan, the South Fork Lift Station was identified as a lift station that had some not insignificant deficiencies. There are some capacity limitations there with the size of the existing pumps. The age and condition of the equipment is less than ideal, especially ten years on since that plan was developed. There's ventilation issues. There's odor control issues.

There's standby power issues. There's there's a number of issues with this lift station. Further, we've got three development projects that are in various stages of design and permitting that combined are expected to slightly exceed the capacity of the list station. So right now is kind of kind of the time to address this. And in the December floods, we actually had a pump failure out there due to a leak in the system that was dripping water right on top of that pump that's supposed to stay dry.

So, it's kind of a opportune time to start looking at that station and what we need to do to it and what we can afford to do to it. So, this particular item is step one of that. It's preparing a preliminary design report for the rehabilitation of that station. So it's kind of a feasibility analysis of what's wrong with it, what can we do with it. Here's a bunch of different options.

Here's about what they'll cost. We take a look at that, kinda go through the shopping list and say, yeah. Let's do this, this, and this, and maybe we cannot not do this because, you know, we're running into budget constraints. So Gray and Osborne is the engineering firm that we've selected to do this work. Again, they're very familiar with our system.

They've done a lot of work for us. There's little background and catch up work that they need to do to get going on this. They they were the, authors of the wastewater facilities plan, so very knowledgeable of our system. Two, let's see. Yeah.

Cost impact is about $62,000. Because there is a growth component, we can use capital funds in this. However, it's probably largely gonna be funded by the sewer sewer operations fund. Again, this this work was included in the rate study and is in the 2026 budget. So that's all I've got. And I

Thank you, mister DeBurgh. Can you clarify any questions?

Any insight on the need for a professional land surveyor and field survey crews on a project like this if, in my mind, we're rebuilding something that's already in situ?

Yeah. So we will be doing the topo and boundary survey out there. So we'll get a good idea of what's excuse me. What's out there, how much room we have to do what we need to do, and, how we can do that.

Thank you.

Anybody else? Okay, miss Cole. This came through TPW again. Make the motion.

No. I would. Thank you, your honor. You're welcome. Motion to approve a B26Dash022 authorizing a work order with Gray and Osborne Incorporated to prepare a preliminary design report for the rehabilitation of the South Fork Lift Station in an amount not to exceed $61,800 in a form and content approved by the city attorney.

Do I have a second?

Second. Second.

Yeah. We're gonna give that to miss Rustic, because she's actually good. Was it him? Okay. Motion by miss Cohen, second by miss Rustic. And miss Cohen, would you like to add, or would you like to comment to your motion?

I think it's important to look into fixing things that might not be working right.

Thank you, miss Rustic. Yes. This is a perfect example when we were talking about the rate study of a project that, you know, costs are so much larger. We have an existing station. This is just the preliminary design, the first phase, which is probably only about 5% of the overall project, and yet it's, you know, $61,000. So I definitely support it. It's just definitely a perfect example of, you know, just how expensive it is to maintain our infrastructure. So thank you. Thank you. Anybody else from council? Mister McFarlane?

Just echo council member Rustic's comment. It it we're just on the beginning of this. We'll be seeing an engineering contract on the chosen solution, then we'll be seeing construction contracts. So I agreed that this is alerting the public. But, again, it's within our utility. This is something that's it's worn out. Time to replace.

Yeah. I've actually been out there firsthand. Okay. Motion to approve a B26Dash022 authorizing work order with Gray and Osborne Inc to prepare a preliminary design report for the rehab rehabilitation of South Fork Lift Station in an amount not to exceed $61,800 in a form and content approved by the city attorney. All in favor? Aye. Any opposed? Motion carries in is unanimous. Thank you, one and all. Closing out we're almost closing out the night. Mayor council administrative concerns and initiatives. Let's mark let's start with mister McFarlane, please.

Nope. Sorry.

What oh, no. I'm starting with you. Busy.

I was busy pulling up my comments to hear you've asking for my comment. Okay. Ready when you are. Okay. No more seconds for me tonight.

Thought for the night. In a short time, this council will again be offered a chance to make an impact for those in need right here at home. And I'm sure we'll hear from many interested parties in the community. I encourage you to listen very carefully to the words from the podium and from the dais to perhaps to a deeper meaning. This train's been a long time coming, which takes me to my song of the night.

Couple of months ago, a new movie came out about Bob Dylan. Frankly, it was just okay, but his music is enduring. And one you surely know is Blowin' in the Wind from 1963. So paraphrasing some lines out of it. Yes. And how many times can a man turn his head and pretend that he just doesn't see? Again, I encourage you to give the song a listen, read the words, understand what's being said in the context of what's going on in our country today. Thank you, mayor.

Thank you. Mister mister Jocelyn.

I believe what my fellow council member is referencing is our work study coming up next week on the two thirty main affordable main housing project, perhaps among other things. And that's a conversation that I'm looking forward to. That's all this evening. Thank you.

Thank you, sir. Mister Tremolotta.

Yep.

Nineteen percent of adults struggle each year with some type of anxiety disorder. Ten percent of adults have some level of mood disorder. So these are depression, anxiety, panic, what have you. Each year, approximately forty four million American adults will experience a serious mental health condition, and less than half of them will seek treatment due to stigma and discrimination. So I'll continue to speak from the diocese about mental health and how much it matters and encourage everybody to seek the help they need, seek a friend, seek a family, have a cup of coffee, make the phone call, check-in on each other. Mental health matters.

Thank you very much, mister Tremolotta, miss Rustic.

Thank you, your honor. I don't have anything this evening. K. Missus Cohen.

I would like to thank the Snoqualmie Valley Basketball League from The Ridge for donating clothes to help me with my homeless population in Harborview, and they were so generous. I had so much, and I ended up giving it to Reclaim in Snoqualmie. And they just keep giving, and now they call me the donation lady, which I'm like, awesome. I don't wanna be that lady, but I am. And then, also, I just wanna say thank you very much. They've been very generous.

Wonderful. Miss Torgerson.

Why yes. I just wanted to say a couple things about community and economic news. For those of you who don't know, Old Navy outlet just opened up this weekend, and they were super busy. Lots of cute clothes in there as well as other things. And then pretty soon, we're gonna have, bath body bath and body works coming.

So keep an eye open for that. I can't wait to go there myself. And then, some of you might know that there's a big soccer tournament coming down the Pike here. It starts on June 15 in our local area and goes to July 6. And these games are gonna bring lots of tourists, and, hopefully, they'll be visiting our town and helping our businesses. And, for everybody else, look out for some watch parties because they're they should be pretty fun. And if you have a if you need a movie tip, I saw solo meo this weekend, and it was awesome. You gotta go see it.

Fun. Mister Elwood.

Thank you. Yes. Mental health is a very important topic that we need to pay attention to, and so I appreciate council member trying a lot of keeping it top of mind for us. On a, I guess, lighter note, but also kind of segues from mental health of dealing with anxiety and, all sorts of interesting stuff. Valley Center Stage, which is our local community theater, partners with Salal Grange, which is so it's two nonprofits working together.

Salal Grange does community benefits for open mic nights. They make blankets for homeless. There's a lot of food drives. There's a lot of things that they do. And and where I get into the anxiety piece is the performance arts. What we have, folks that come through Valley Center Stage to be a part of productions and including the one that we're recently putting on, which is Macbeth, to to think about it in one way, we have probably over 30 some odd people have volunteered to be a part of this production. Now Valley Center Stage doesn't pay anybody. I'm on the board. Board members don't get paid. Matter of fact, be on the board, and you spend a lot of money.

But it's a it's a nonprofit that really allows opportunity for people to explore something new. In this particular production, we have folks that have just recently retired that it's always been a thing for them to try to get in front and speak in front of people, do things like that. Other folks that, you know, maybe have, wanted to understand art, painting, building, construction. We we've had volunteers, interns from Two Rivers High School here show up, help build the sets. We try to organize through the schools to help them, at least provide that opportunity.

You know, when you support the local arts, especially in a community theater dynamic, it's more than just going and seeing a show, which is a cool thing. It's more than just, you know, going and seeing a show that helps you think about things a little bit differently, maybe ease your mind off of the travesties that you may be seeing going on in in the world around you. But it also provides an opportunity for people to express themselves and to unite and come together on one common thing, which is art, which is cool. Production, for example, you have actors, obviously, have to learn their lines, develop characters, learn you have people coming together, don't even know each other, working together in a very stressful situation to try to figure out how to make this character or that character tell the story that you're trying to tell. We have light designers, sound designers.

We have a construction. We have set painting. We have costumers, wardrobe, I mean, all of these different things go into telling a story in a live performance environment. And these are all people that come together, work really hard for five or six weeks on a production, launch the production. It may last three weekends. In our case, it's three weekends. And then they go, and you may never see them again. Right? You see them in another show someplace else, or they show up later, or they keep coming back. But I just wanna highlight that there is a production now.

It closes this weekend of Macbeth, which is a pretty good production. I'm involved with it. That's why I say it's pretty good. But the point that I'm trying to make is that there's a lot of people that come together to make that happen and that storytelling come alive. Working professionals, retired professionals, people that have no money, but they just need a community, and it becomes their tribe. So it's a beautiful thing. So come check us out. Just doing so, even if you don't like the the topic, even if you think the performance sucks, it doesn't matter because your your ticket is helping these people do something cool in the community that they wouldn't otherwise have the opportunity to do. But please perform or please, support all your local arts or any sort of community endeavors like that. Thank you.

Wonderful. Miss Emery.

Just wanna say thank you to our public work staff planning for our potential snow event that we we're going to have today, which I guess it is snowing at that moment in time. So I wanna say safe travels to staff that are gonna be on their way home to Nyan council. So I just wanted to say thank you to our public works team who work around the clock to get that get that prep going.

No. Can't quite see the snow from my view, but, I'll believe you. Okay. Please join me for my meetup of the mayor series starting again tomorrow at 11:00. I'll be at the Trail Of Youth. Please come with any questions you have. We'll if don't have the answer at hand, we'll we'll go and find it for you. It's always fun. The Trail Youth is located at 226 East North Bend Way. I just wanna say quickly that, thank you to the city of North Snoqualmie who donated the original welcome to Twin Peaks sign that we used tonight for a proclamation. We've that's an example of working together. Two cities just just helping each other. It's always open to that. And thank you again to council tonight for your excellent engagement. I appreciate that.

To staff, amazing job as as always, And to our community who spoke up tonight, whether online or in person, thank you for being here to the very end. And I won't say it's bitter. I hope it's not bitter. I just said it was bitter, didn't I? Okay. Thank you very much. And with that, I'm gonna let's see. Let's have a motion for adjournment. Okay. Second. Thank you. Thank you one and all. Be safe in the snowy conditions.

Alright.