April 2024 Utility Rate and Income-Based Discount Program Updates

UTILITY Rate Adjustments Go into Effect April 1

New rates are necessary to support the separate business units of Water, Sewer, and Stormwater at the City. Significant investments are needed to maintain and upgrade our aging systems. The utilities require $20 million in City investment in the next five years, which is in addition to $10 million in anticipated grant funding for the system. Learn more about some of sewer system upgrades in our video on Sewer System Investments. Watch the eight-minute video on our YouTube channel.

On February 20, 2024, Port Townsend City Council passed historic ordinances for utility rates and utility tax to address our aging sewer and stormwater infrastructure. In tandem with the new rate structure, Council voted to expand the City's Income-Based Discount Program in order to address affordability of the rate increases. The ordinances have been presented and discussed in several Council meetings since late 2023, including Infrastructure and Development Committee, Regular Meetings, and Council Workshops. All meetings and presentations on utilities from February 2024, can be found below and additional meetings in the Agendas & Minutes archive on our website.

Overview

The City's current stormwater and sewer rate ordinances require rate increases annually to keep up with inflation and fund capital improvements. A study was conducted to set rates for the next five years, and the new rates will be effective starting April 1, 2024.

The new ordinances include four main components, with detail below:

Updating sewer and stormwater rates including merging the capital surcharge into the base rate;
Updating the code for an expanded Income-Based Discount Program;
Updating the System Development Charges (SDC) amount and structure;
Updating the utility tax rate based on gross revenue calculations and proposed rate structure.

Details:

Sewer rates will increase by 13% each year and stormwater rates will increase by 10% each year for the next five years.
The City’s Income-Based Utility Discount Program has expanded from one level of eligibility to include three tiers of eligibility with discounts ranging from 25% to 75% off the base rate. Information on eligible income levels and how to apply are forthcoming.
Stormwater and SDC rates are now based on a graduated scale for the square footage of impervious area. The stormwater fees now include an urban forestry fee for tree planting and maintenance.
The utility tax rate is currently 18% and will be reduced to 16% starting April 1, 2024, to reflect changes in the rate structure and maintain general fund revenue as budgeted in 2024. City taxes fund general government services such as parks, streets, police, facilities, planning, and more. Other taxes included in your rates are State Business & Occupation Tax at 1.75% and State Sewer Collections Tax at 3.852%.