The water system in South Fidalgo is changing hands, but customers shouldn’t notice much of a change.

The Anacortes City Council approved a plan at its meeting Monday to transfer the Fidalgo Island Water System from the Skagit Public Utility District to the City of Anacortes.

City Director of Public Works Fred Buckenmeyer said he’s been working toward the transfer for more than a decade.

“This is a milestone for me this evening,” he said.

The 65-year-old Fidalgo Island Water System provides water to 732 commercial and resident customers in Similk Beach, Dewey Beach, Gibralter, Fidalgo Heights and Summit Park.

Currently, the city supplies water to Skagit PUD to sell to those residents. Cutting out the middle man could mean improved maintenance and emergency response times for customers and increased opportunities for the city, according to Brian McDaniel, the City of Anacortes water system manager.

“These customers will be better served by the city, just based on geographic location,” he said.

The transfer would increase the city’s annual water revenue by $470,000 and an additional $32,900 in utility tax, McDaniel said. The system is self-sustaining, so it shouldn’t cost the city any extra to run, he said.

A memorandum of understanding was already completed in 2019 between the two entities. Then, in early March 2020, the Skagit PUD and the city hosted a joint open house.

On July 27, the Skagit PUD commissioners authorized its general manager to sign the agreement. The City Council then approved the agreement Monday.

Prior to signing the agreement, water staff looked at the system to make sure things are working as it should, McDaniel said. That includes leakage, which is low, he said.

Before the transition is complete, Skagit PUD has two years to complete some capital improvements in the system, totaling about $1.5 million of work, including reservoir abandonment (when the reservoirs don’t work with placement of city water systems) and pipe replacement.

Then, over the next 20 years, the city will replace pipeline that includes asbestos. By combining the two water systems, the city is easier able to complete that necessary work in a cost-effective way, McDaniel said.

Before the transfer would be complete, however, the Skagit PUD agreed to complete three projects, including replacing a reservoir and a concrete pipeline that contains asbestos.

“There are opportunities for us to make improvements for us to do more routing of water and other operational strategies will be open to us that aren’t right now,” McDaniel said.

Skagit PUD mostly serves Burlington, Mount Vernon and Sedro-Woolley, but it also has some remote systems including Potlatch Beach on Guemes Island. It has provided the water to the Similk Bay area since 1956 and Gibralter and Dewey Beach since 1961.


– Reporter Questen Inghram contributed to this report.

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