With over 70% of residents voting to approve in the November 2012 election, Shoreline voters have authorized the City to create a water utility and thereby acquire and operate the Seattle Public Utilities' (SPU) water system in Shoreline by moving forward with negotiating a final agreement.
Timetable for negotiations
Over the next year, the City will be working closely with the City of Seattle to finalize a purchase agreement. We anticipate continuing those discussions in December with the hope of having an agreement ready for review by Shoreline and Seattle city councils by spring. Both councils will need to approve the agreement before it is finalized. The goal is to complete that process by fall.
Once the purchase agreement has been signed, Shoreline will begin developing operations plans and preliminary work on the initial capital improvements that need to be completed before the transfer of the system in 2020. Planning work will take place over several years. Beginning in 2016, the City will also begin preparing a Comprehensive Water Plan, as required by the State. The plan will be adopted in 2017. Construction of initial capital improvements and separation of the water system from Seattle will begin in 2018.
In the meantime, beginning in 2015, the City will work closely with Ronald Wastewater District (RWD) to prepare for merging the wastewater utility into the City in 2017. Planning for and integrating RWD into City operations at the same time we are planning for acquiring the water utility will allow the City to look for mutual operational efficiencies that benefit both utilities. These efficiencies or savings to the utilities could come from sharing the cost of billing services, equipment, facilities and personnel.
What will the water system acquisition cost?
$26.6 million - Purchase price (pays for the infrastructure)
$14.2 million - Initial capital and separation costs*
$40.8 million - Total cost for acquisition
*2 million gallon storage tank, pump stations and controls, utility buildings, heavy equipment and vehicles, and tools and inventory = $8.3 million. Separation = $5.9 million.
The City of Shoreline, SPU and the Seattle Mayor's Office came to an agreement on the purchase price using an agreed upon valuation method for utilities.
How will the City pay for the acquisition?
- No property taxes will be used.
- Acquisition, separation, and initial improvements will be paid for with a "revenue bond".
- The revenue bond will be repaid from water utility revenues.
- The full cost will be paid through the City's water utility rates.
- There will be no increase in rates above SPU's projected rates.
Timeline
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Related Documents:
Staff Report for June 11, 2012 Council Meeting (PDF)
Staff Report for May 7, 2012 Council Meeting (PDF)
Staff Report for March 5, 2012 Council Meeting (PDF)
Presentation for March 5, 2012 Council Meeting (PDF)
Staff Report for January 23, 2012 Council Meeting (PDF)
Staff Report for May 23, 2011 Council Meeting (PDF)
Staff Report for April 18, 2011 Council Meeting (PDF)
Presentation for April 18, 2011 Council Meeting (PDF)
SPU Water System Map (PDF)