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Tualatin talks liquid assets

Revisiting the water master plan, City Council faces some uncertainties in the face of growth


Discussion about the Tualatin’s water master plan became a larger debate during Monday's City Council work session, with city leaders addressing the city’s growth over the next two decades.

The city is required to update the water master plan every eight to 10 years, and has not formally done so since 2004. Although Tualatin water use has come in under projections made in 2003, developments planned in the southwest industrial area and the Basalt Creek area present increased demand within the next 20 years.

With water available through a long-term contract with the city of Portland Water Bureau and emergency reserves at an aquifer storage and recover facility, Tualatin currently has access to a total of 11.8 million gallons of water per day during its peak season, summer. Maximum daily demand is currently at 9.5 million gallons per day. The City Council heard this supply could prove inadequate within its 20-year planning horizon. It is projected that the city could require 13 million gallons per day by 2030.

This would require not only an additional supply source, but also significant improvements to infrastructure to handle the increased volume of water. One such improvement might be a proposed 16-inch pipe along 124th Avenue. Such improvements would cost the city an estimated $20 million or more over as many years.

The council discussed whether it would be more prudent to cover such costs through a water rate increase or through a hike in the city’s system development charges, which apply to new building projects and some building improvement projects.

According to Councilor Ed Truax, who sits on both the Regional Water Suppliers Consortium and Willamette River Coalition, the answer was a balance of both.

Truax explained there was already an assumed water rate increase: an annual compounded interest rate of 3.2 percent that takes into account Portland’s expected rate increases. An additional one percent increase, he said, would provide approximately $2 million each year for water-related infrastructure improvements.

“The rate formula that we use to buy water from Portland is tied to the infrastructure that is used in that system to deliver our water, and the cost of managing the system, so those costs are primarily fixed,” Truax explained. “What we can assume is that we will get very modest steady increases (from Portland) over a long period of time.”

According to City Manager Sherilynn Lombos, Tualatin’s contract with the city of Portland Water Bureau was set to expire in 2016, but in the absence of any cancellation, automatically renewed itself. Currently, Tualatin’s contract is valid through 2026, and requires five years advanced notice prior to cancellation. While it appears Tualatin is locked in to this agreement with the city of Portland for most of its planning horizon, Truax explained that other water sources would prove even more expensive.

“The first policy question in my mind is, what do we do as a city to make sure we have infrastructure in place to allow for the growth that we need to keep our assessed valuation (as a city)?” Truax said. “What we have to do, in my opinion, is modest rate increases (to) give ourselves the cash flow to begin (infrastructure improvements), and we pay ourselves back” with greater tax revenue that comes through an increased assess valuation as the city expands development. Truax argued that the city would then derive even more income from system development charges paid as a result of the city’s growth.

Still, Traux urged the council not to rush into any decisions about whether it would need additional water sources.

He supported recommendations from city engineers that the City Council revisit the master water plan in two years. Too many factors remained unknown for the city to commit to any major changes in water supply, he said.

“A lot is going on around us that has yet to play out,” Truax said, adding that Tigard, which also buys much of its water wholesale from Portland, was in the process of re-examining its own “water course.” Meanwhile, the city of Hillsboro was conducting public hearings regarding future water supply.

Other unknown factors include the rate at which Stafford Triangle develops, and how the Basalt Creek area would be divided between Tualatin and Wilsonville.

But Mayor Lou Ogden voiced concern about a vague future water supply. With the agreement that the city would revisit the master plan in about 18 months — a period during which projected growth wouldn’t create a demand that exceeds the current maximum reserve of 11.8 million gallons per day — the council came to a consensus in favor of a 4.25 percent water rate increase, which could take effect within the next year.

That is an increase of nearly 10 cents per unit, which is measured as 100 cubic feet of water or 748 gallons. On average, a Tualatin family uses about eight units per month. Current water rates are $2.29 per unit, so the average monthly cost to Tualatin customers is $18.32 per month. After the rate increase, these customers could expect to pay about $19.09.

The council then discussed whether Tualatin should set a single citywide SDC — currently $3,266 — or a reduced general SDC of $2,661 with a separate SDC that would apply to the southwest industrial area, which would be $5,613. Concerned that the second option would stymy development, the council opted to stick with a single SDC that would be increased to $4,428.

Changes to the water master plan will be opened for public comment in February. The Planning Commission is expected to present their feedback on Feb. 21. The council is scheduled to formally accept changes on March 11.



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