Sept. 8, 2010

Media contact: Chris Gleason, Community & Media Services manager, (253) 223-2293

Tacoma Water management presented its 2011/2012 budget to the Tacoma Public Utility Board today. To balance the $164 million budget, the utility proposed a rate increase that would raise residential customers’ bills by an estimated $1.75 per month in both 2011 and 2012.

Some of the key items that will affect Tacoma Water’s budget in the coming biennium include:

· Government requirements – Tacoma Water will continue its progress on a new filtration plant in 2011. The $200 million (estimated cost) plant will meet a federal requirement to treat for cryptosporidium.

· Aging pipes and equipment – To ensure reliable service, the utility will spend $42.5 million on replacing pipes and equipment in 2011 and 2012.

· Economic impacts – Tacoma Water did not see the growth it anticipated in 2009 and 2010, and expect little growth in the next two years. The utility must rely on existing customers to provide the revenue needed to operate the utility.

“There is never a good time for a rate increase,” said Linda McCrea, Tacoma Water superintendent. “We have worked very hard to minimize the costs we can control to reduce the financial impact on the people we serve.”

About 70 percent of Tacoma Water’s costs are fixed. Some of the cost-cutting measures on the non-fixed costs include:

· Reducing 30 positions in the 2011/12 budget

· Reducing operating expenses by 2 percent – a $3.2 million difference

· Downsizing its vehicle fleet

· Financing its debt at a low interest rate, which saved ratepayers about $4 million

Both the Public Utility Board and the Tacoma City Council must approve the budget and rates. The Public Utility Board will conduct a first reading of Tacoma Public Utilities’ budget on Oct. 13 and a final reading on Oct. 27. The City Council is scheduled to vote on Tacoma Public Utilities’ budget in November.

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About Tacoma Water
Tacoma Water is one of Tacoma Public Utilities’ three divisions. It has a proud tradition of operating and maintaining one of the United States’ oldest municipally owned water systems. We provide high-quality water at competitive prices.