Dedicated to the citizens of Mason County, Washington since 1886
Dedicated to the citizens of Mason County, Washington since 1886
More connections needed to offset cost increase
More than 50 people fired up their computers, tablets or phones to join a Zoom room for a public hearing about the Belfair sewer project Monday evening.
The hearing lasted more than four hours, with staff presenting information to the public, followed by community questions, public testimony and commissioners voting to continue the public hearing at 9:15 a.m. on March 1 before making a decision on what to do next.
Belfair sewer information
County Administrator Mark Neary started the hearing and recommended not acting at the end of the public hearing so staff can compile more information.
"My goal tonight is to really educate, not only our board, but also the public on the Belfair sewer system and some of the challenges we have in front of us," Neary said.
Public Works Director Loretta Swanson presented a history of the sewer project. The planning began 20 years ago to address water quality and growth management planning requirements. The facility plan and environmental impact statement was worked on from 2001-2004 and construction began afterward. The facility became operational in 2012.
Mason County Deputy Director of Utilities and Waste Richard Dickinson said the system has 125,000 gallons per day of capacity. The facility is a membrane bioreactor, he added.
"That's how good they are," Dickinson said. "They have openings of less than 2 microns, so they're very efficient, very good, [but] they're kind of expensive."
He said staff training has improved, and the number of employees has risen from four to eight.
"Making these and ensuring these are operated and maintained to be optimum and reliable is imperative," Dickinson said.
Swanson said 421 equivalent residential units (ERUs) are connected to the plant. She said to pay everything off with the 421 ERUs, the additional monthly charge per ERU would cost an added $256 per month per user and to balance the operations and maintenance costs with existing ERUs, the increase would need to be $208.25. The other way to pay for everything is adding more connections. To balance all of the debt, an additional 1,128 ERUs would be needed and to balance just the maintenance and operations costs, it would be an additional 214 ERUs.
"We're looking for more connections so we can keep our rates at a reasonable amount," Swanson said.
Mason County uses real estate excise taxes for debt payments and rural sales tax money to pay for system improvements, which generates $1.25 million yearly. The county is trying to find other ways to make up the difference, including refinancing existing debt. The county has asked for legislative assistance through rate relief and grants, and has received a loan offer recently to construct the sewer extension. Development barriers have been taken down by the county, including code revisions, zoning changes and the planned action environmental impact statement.
Swanson said the estimated construction costs for the proposed sewer extension is $3.9 million and the county is using $4.5 million as a 15% contingency plan. The extension begins at the Olympic View and Olympic Ridge projects just above the McDonald's and post office, and that portion of the extension is being built by the housing developers. From there, it will go under the railroad tracks and run behind property along state Route 3 until it reaches the edge of Mason Transit Authority's Belfair Park and Ride property.
Swanson presented three options for the project. The first is to keep the status quo and acquire no new debt. Another option is to continue the project as planned and add $4.5 million of debt. The third option would be to build a portion of the project, such as complete construction under the railroad crossing, lift stations or the lines between lift stations, which could cost $1.2 to $3.7 million.
Swanson talked about how the construction will be paid. The county has received and executed a loan offer from the state Public Works Board and the maximum amount of the loan is $8 million. In the loan agreement, it states "the contractor shall adopt a rate increase of $87 to the base monthly rate per ERU or demonstrate there has been an increase ERU(s) prior to project completion." Loan security includes language stating "this loan is a revenue obligation of the contractor payable solely from the net revenue of the sanitary sewer system."
"When commissioners approved this loan, they were clear in their direction that they want this to be a general obligation as opposed to a revenue obligation and so we are in discussions with [the state Department of] Commerce to make amendments to that," Swanson said about the loan. "That has not happened at this point so these are the conditions that are in effect today."
The loan agreement also includes the scope of work to "construct two or three sewer lift stations, gravity sewer and pressure main extending from the Belfair Waste Reuse facility to the Puget Sound Industrial Center at Lake Flora Road." Swanson said after conversations with the port and Bremerton city officials, the port said they are not interested in connecting at the moment. That's why the county wants to go back to the Legislature and update them and ensure the project is meeting the legislative intent.
Staff presented a breakdown of costs and deficits over time based on the phased ERUs up to 794, which includes the additional ERUs being built at Olympic Ridge and Olympic View. The staff also showed the different utility rates in the surrounding area. Belfair pays about $96 and the maximum tolerable rate is $114.73. Port Orchard and inside Bremerton city limits pays about $64 per ERU and outside of Bremerton city limits, it's about $97 per ERU. Shelton pays about $133 per ERU, North Bay pays about $119 per ERU and Rustlewood pays $112 per ERU.
County staff announced an interactive map posted about the Belfair UGA and utilities that are within the UGA at https://mason.maps.arcgis.com/apps/mapviewer/index.html?webmap=7f5f58fccdec4f5cb026ed3f6d1a6a98.
Testimony
Staff presented for almost two hours before the public was able to ask questions and make comments. Some of the questions focused on where the line is being planned, who benefits the most from extension plans and what the current rate of growth is in the county to justify the extension.
Belfair-area resident Adam Bernbaum asked commissioners whether they would commit to not raising the rates. Commissioner Kevin Shutty has said he's committed to keeping rates stable while evaluating options.
"That's not a commitment I'm backing away from," Shutty said. "Obviously, there's some financial analysis that recommends we increase rates over time like we do to the other utilities in the county annually but as we're going through this planning phase right now, I'm certainly committed to keeping rates where they are and won't back off of that commitment."
Commissioner Sharon Trask said she agreed with Shutty's comments, adding that when the commissioners voted on the loan in March 2020, they did not want to increase the rates "at least not at this time."
"I would feel more comfortable if we were stable and if Belfair was stable," Trask said.
Commissioner Randy Neatherlin said that is why the $87 rate increase in the contract was "a huge scare," although he didn't directly answer the question.
Neary said from a financial perspective, he worries when he hears the commissioners say that the county will not increase rates. The rate has been $96 since 2012.
"The costs of operation and maintenance will continue to increase, you will continue to have materials cost more money, so from a purely financial perspective - but understanding the potential impact to customers within this area - I personally worry and am a little bit concerned about what that looks like moving forward," Neary said. "Because ultimately, my concern is if you try and catch ratepayers up all at once, then that significant impact is a true hardship. I'm not trying to pretend and say it's not a hardship to see a $5 or $6 increase per ERU, that's significant, but I do worry from a financial perspective about not entertaining a potential increase in rates."
Belfair-area resident Kim Wilson asked why there was no plan to extend the sewer to the west of state Route 3 and put in a sewer line down Old Belfair Highway. Community Development Administrator Kell Rowen answered Wilson, explaining the return on investment in bringing sewer connections down the Old Belfair Highway is "pretty low density relative to what urban growth areas should be."
"It is speculative, but the county already has received, we've had preapplication conferences for a considerable amount of development and we also just received a special use permit for a large warehouse development north of Log Yard Road," Rowen said. "Not sure what the number of ERUs would be but of course, if the sewer extension was there, they'd be required to hook up. There are tax revenues based on a conversion, it's currently undeveloped land and that would be warehouses, that is a significant impact to the county overall."
Neary said 177 comments were submitted through email, with 169 against and eight people supporting proceeding with the sewer extension. The county could not determine whether eight emails were for or against the extension.
Public testimony featured speakers for and against.
County resident Brad Carey said he is in favor of the extension because the sewer needs more connections to make the sewer system go from "red to black."
"If people want their sewer rates to stay the same, or be reduced, or at least go up 3% annual inflation rate, but not anything more than that, they must get more connections," Carey said.
Allyn resident Phil Wolff testified that he thinks the priority should be to extend the sewer down Old Belfair Highway and to Belfair State Park because of the environment.
Rob Drexler, who has homes in Shelton and Tahuya and a business in Belfair, said he is against the proposed plan. Drexler was on the Belfair sewer advisory committee and said he was glad about commissioner Neatherlin's op-ed in the Journal and his Facebook post.
"Unlike before, we've had no community involvement in this and that's a crying shame," Drexler said. "That's a crying shame that there has not been a meeting, there hasn't been anything that has warned anyone in the north end area about what's going on and that is absolutely unconscionable in my opinion."
Brenda Hirschi asked the commissioners to not make a decision after the public hearing because she doesn't feel she has seen a long-term financial plan for the planned extension.
"This is not ready yet to pull the trigger and what's furthermore, I'm still left really questioning that we have two developers, Olympic Ridge and Olympic View, that have paid for the infrastructure, paid to bring in the sewer line and we're going to go out and borrow money especially in light of this additional information that we got tonight that there are capital improvements that are needed for this sewer system," Hirschi said.
Aliahna Watts said it's obvious who is going to profit off of an extension, which is property owner David Overton, who owns the land around where the proposed extension is planned for.
"Did you hear that?" Watts asked Overton.
Overton, a Tacoma resident, provided his testimony, stating his family has been in the community since the 1920s. He said his family was part of a team that wanted to be part of the solution and found development partners that were part of a team that helped 371 connections and almost doubled the system in Belfair, which he said he is proud of.
"If the county wants to extend sewer lines through our land as well as benefiting the other [Route] 3 frontage properties as well as designing the site to handle all of the industrial properties to the west of [Route] 3, we'll lean in and we will help deliver projects, just like the largest projects that Belfair has seen that is solving the problem," Overton said. "... There were a lot of people that were saying, 'When you're in a hole, stop digging,' and I think that's right and I think the county commission stopped digging. But you know what you don't do with a hole? You don't just look at it and say let's wait till the sides collapse and fall in and that hole fills itself up. Instead, we've got a county commission that said we're going to put a foundation in that hole. We're going to put that hole to utility and we're going to build something that gets us out of that hole and I'm proud to be part of the solution versus saying 'Hey, we shouldn't do anything.' "
Decision
Before commissioners deliberated, Neary said he believes staff has additional questions that need to be answered and they need to go back to the Legislature to show the revised scope and get approval.
"Factoring that information into this analysis to really take a true whole picture look at what are our options and what is the correct decision moving forward," Neary said. "I'll tell you that you have some amazing staff here that are really dedicated to ensuring that the public is aware of what is going on. I think that they are going to continue to work forward so I would recommend that we continue this hearing to a future date."
Commissioners Shutty and Trask voted for continuing the public hearing at 9:15 a.m. on March 1. Commissioner Neatherlin voted against the continuance.
Neatherlin said he appreciated the comment about waiting 30 days, but he said it's a lot bigger than the words in the loan document. It's the loan itself, too, he said.
"It's the idea of putting in investment money into something the developer should be doing themselves," Neatherlin said. "Also, if we are going to do that, to capture that money, to make sure that we get it and it doesn't go with the land sale. There's so much to this. One of the biggest parts mentioned was a cost-benefit analysis, boy could I not agree more on something. This whole process that we've been through, we keep finding information almost daily. It means that we're in a situation where we're trying so hard to push this thing through that we still didn't have the information to make our decisions on."
Neatherlin said he wants to come back with a holistic analysis of the system.
Trask thanked everyone who participated in the hearing and who submitted comments. Trask was in favor of continuing the hearing and said there are so many elements that are not being put into the equation that need to be looked at. She thanked staff for informing her about the sewer project. She said she believes the project was set back by years due to the recession in 2008.
"Increasing the debt, I don't support that. There are other ways, there's a possibility that we could use ARPA (American Rescue Plan Act) funds," Trask said. "There are funds that won't increase our debt but still gives us the opportunity to grow and to live up to the requirements, the mandates that we have, according to the UGA and GMAs. I'd like to say that I was raised to be ethical and to care for the community I live in. I know that I can say my family is proud of who I am and what I have done for Mason County. I would never selfishly manipulate the system we have in place to benefit myself and I hope others could say the same."
Shutty said it was great to have the amount of participation received and he trusts staff to bring back more information to make the correct decision.
"We know that this issue is one that has been difficult for everyone. Whether you were one of the decision-makers who decided on this project when the sewer was first built in Belfair to whether you were a citizen on the sewer advisory committee or you were a commissioner who inherited the sewer system as it was and as it is today," Shutty said. "This sewer challenges our community in incredible ways. These are issues that are dry but these are really the foundational responsibilities of local government, cities and counties and there's no way that we can avoid having to plan into the future for the Belfair sewer, regardless of what you believe is the case about why we have it and how big it is and who it should serve and who it shouldn't and all that kind of stuff."
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