Chelan PUD Commissioners consider rate options in Peshastin Water District acquisition

PESHASTIN – Chelan PUD Commissioners received updates and public comments regarding the Peshastin Water District (PWD) acquisition at the commission meeting on Jan. 22.

Since the community forum, refinements were made to the proposed rate adders after considering declines in market interest rates and the utilization of existing PWD cash that could be applied toward capital projects. 

The updated estimated rate adders per month were $16 for a residential customer, $30 for a commercial customer, and $1655 for an industrial customer. The estimates are slightly lower than those presented during the community meeting on Jan. 17, which estimated $17 a month for a residential customer, $33 per commercial, and $1780 per industrial.

PWD General Manager Steve Keene presented to the commission the reasons that led PWD to request Chelan PUD’s acquisition.

“We have done a lot to improve our system and the financial status of what we are, but we still need the PUD to help with the depth of our operations,” said Keene.

However, Keene requested that PUD reconsider whether a rate adder was necessary and to implement it incrementally if it was. 

“We’re also part of the PUD already. We’re residential, commercial and industrial electric and sewer customers. We’re already part of your system,” said Keene. “If it’s going to take three years to do any capital improvements, how much more do we have to be a part of your system before the capital improvements we need could be accommodated like it would with any other part of your customer base?”

During the public hearing, Ray Schmitten and Shawn Cox spoke on behalf of the two largest grower co-ops in the area, Blue Bird Inc. and Hi-Up Growers. 

“We appreciate the PUD’s interest. I think it’s important for us to have a healthy water supply, obviously a consistent city water supply, with our history, great fire suppression is important apparently, and of course cost is a great [consideration] and why I’m here today,” said Schmitten.

Schmitten agreed with Keene’s statement, asking for more considerations. Cox agreed.

“Much like Ray, we’re food processors. We need safe, reliable, consistent water for both processing food and fire suppression. With the current times in farming, we’re a small co-op, we’re made up of about 47 different small growers. We average about 30 acres [per] farms of pears, for our growers. Any type of increase, especially during these economic times is really tough,” said Cox. 

A third speaker, a Peshastin resident, expressed similar concerns, calling the rate adder “inappropriate.” 

“What we are giving is a commitment to be there for you and to shore up your capital improvements as they are needed, whether something happens from an emergency perspective, or whether we can plan for it down the road. That partnership I believe serves us and serves Peshastin quite well. The question is, how do we get down to the rate adder?” said PUD Commissioner Kelly Allen.

PUD Treasurer Heather Irelan presented two other options for rate adder implementation, besides the rate plan as proposed. A second option would adopt the rate adder in increments over the next three years and adjust the term or rate as additional funding comes in. A third option would adopt the rate plan but delay implementation for 36 months. During that delay, PUD would reevaluate funding sources.

PUD Commissioner Garry Arseneault supported the merger, but had concerns with other options possibly affecting his district negatively.

“There are risks associated with the acquisition of any water district,” said Arseneault. 

PUD Commissioner Carnan Bergren made a case against the rate adder, claiming a number of similar projects in which PUD had not implemented rate adders to a community.

“One of the things I think would be important for you to consider is who paid for the fiber network when we subsidized 90 to 100 million dollars? Where was the rate adder on that for the people that were taking service?” said Bergren.

A resolution seeking the adoption of the rate plan as well as a resolution seeking approval of internal loan terms is tentatively scheduled for Feb. 5.

Taylor Caldwell: 509-433-7276 or taylor@ward.media