Economic development concerns are prompting the Skagit County Public Utility District to reconsider how it charges new water customers a one-time development fee, and the topic is expected to come up at a meeting this afternoon.
The PUD uses a complicated scale to charge a system-development fee based on both the amount of water the customer plans to use and the size of the water meter needed to accommodate that volume. The existing scale was implemented in 1999.
But General Manager Dave Johnson is proposing that the PUD charge a flat rate based only on meter size. However, fees for customers needing larger meters, and therefore more water, would be determined on a case-by-case basis.
The current structure can limit economic development, Johnson said.
“The problem is that it is contrary to promoting economic development, and it creates ill will in the community,” he said at last week’s PUD commission meeting.
Johnson gave Sierra Pacific Industries’ new timber mill in rural Burlington as an example. Under the current fee scale, Sierra Pacific would be in the 11th step on the 4-inch meter scale because it’s estimated that the mill will use up to 90 million gallons of water annually. That means Sierra Pacific would have to pay $643,500. The first step in the 4-inch meter scale, however, charges just $58,500.
When Sierra Pacific was quoted that 11th-step fee a few years ago, Johnson said the timber company countered that it could obtain its own water rights and drill wells instead of using PUD water. But a 1996 water memorandum of agreement between Skagit County, area municipalities and tribes calls for piped water whenever possible.
Local leaders were upset at the idea of Sierra Pacific drilling wells and joined the discussion, said Johnson, who has held his post since July and was not here when the issue first arose.
Sierra Pacific has not paid its development fee yet because it has been receiving PUD water through a temporary service agreement since it opened for business in January 2007. That temporary agreement was extended for another 90 days at the March 4 PUD commission meeting after Johnson reported the district and Sierra Pacific were nearing a final agreement.
Sierra Pacific spokeswoman Sheri Nelson declined to comment Friday, citing ongoing negotiations between her company and the PUD.
PUD commissioners will further discuss system development fees today at their weekly meeting, which begins at 4:30 p.m. at the PUD office, 1415 Freeway Drive in west Mount Vernon.
Other items on the agenda include a draft of the agency’s strategic plan and a presentation by NoaNet, a wholesale fiber optic company that could assist the PUD when it completes a telecommunications line between Mount Vernon and Concrete.
* Franny White can be reached at 360-416-2148 or
