Chase bill on utility district voting moves from State Senate to House

Wednesday, March 25, 2015

By Evan Smith

A bill that State Sen. Maralyn Chase introduced to ensure that ratepayers have a voice in a city assumption of water or sewer districts is under consideration in the state House of Representatives after it passed the Senate two weeks ago.

Democrat Chase says that the purpose of the bill is to give voters the ultimate control over whether a city or town can assume jurisdiction of such districts.

The bill passed the Senate March 11 by a 28-21 vote. The House committee on local government approved it March 19 and sent it to the Rules Committee.

Chase, the prime sponsor of Senate Bill 5048, represents the 32nd Legislative District, including the City of Shoreline, part of northwest Seattle, Lynnwood, Woodway and nearby unincorporated areas of Southwest Snohomish County, and parts of Edmonds and Mountlake Terrace.

She has opposed Shoreline’s attempt to assume the Ronald Wastewater District without a public vote.

“These special-purpose districts are created by a vote of the people, for the people," she said recently. “As such, 100 percent of the taxes we pay for our water and sewer systems should be dedicated to providing the services and maintaining the system. 
“These funds should not be diverted, or ‘repurposed’ for other uses such as new developments or other non-water-sewer projects unless the voters approve.”

SB 5048 would let voters call for a referendum on any attempt by a city or town to assume jurisdiction of all or part of a water or sewer district.

As with other special-service districts such as fire districts or school districts, ratepayer revenue must be spent solely for the purposes of the utility districts. However, Chase noted, if a city assumes ownership of a water or sewer district, the city may levy taxes without limits, without restrictions on what the funds are used for, and without a vote of the citizens who voted to create the district. She added that water and sewer districts are the only special-service districts that do not have a cap on the taxes that can be levied if a municipality assumes one of these districts.

“Across the state, in the wake of the Great Recession, municipalities are struggling to make ends meet — and are assuming control of water and sewer districts to increase their revenue flow for other programs and projects,” Chase said. “That’s not why people vote to create a water or sewer district. People want a reliable water and sewer system — not a funding mechanism outside of their control for projects they don’t approve.”

Utility taxes are among the most regressive taxes levied on citizens, Chase noted, adding, “Water and sewer are basic necessities and low-income ratepayers have no choice in accepting or refusing service or paying the ever-increasing taxes. For example, low-income working families pay 17 percent of their income in taxes compared to wealthy families who pay only 2.8 percent. 

“This bill will ensure that the democratic process can work the way it was meant to work,” Chase said. “If it’s truly in the public’s best interest for a city to assume a water or sewer district, then the city rulers should have nothing to fear from a vote by the people who would be paying the tax.”

Evan Smith can be reached at schsmith@frontier.com.



8 comments:

Anonymous,  March 26, 2015 at 7:53 AM  

Imagine that, allowing people to vote to get rid of a government that they had to vote to get started.

The trend on the East Coast is for the creation of water and sewer special purpose districts because that is all they do. All the funds that are collected from providing this service are channeled back into the service, less the fees charged to the utility by the cities in which it operates. In the City of Shoreline's case, it currently charges Ronald Wastewater in excess of $800,000.00 annually for the right to have pipes in the City right of way. This money goes directly to the General Fund of the City to be used as they see fit - not one cent is spent on providing wastewater service.

As the City goes forward with the assumption of Ronald, this fee will continue in the form of a utility tax. Utility taxes are not limited and do not have to be voted on.

Cities are tasked with providing a huge number of services, from parks to social services, and they are doing so with less money.

The key to all of this is that there would be no city, no school, no park without water and sewer. This is not a service that should be subject to the political arena. Elected officials should not have to choose between repairing streets or providing safe drinking water. One is readily visible and one is not seen at all.

Special purpose districts are formed when there is no one else to provide these services. Many have been in existence for 50+ years and operate effectively and efficiently.

Give the people the vote on whether or not they want the City to take over a District. Support this bill!

Janet Way March 26, 2015 at 10:27 AM  

I strongly support this bill and Senator Chase' brave and determined advocacy.
Pay attention Shoreline! You are being railroaded in more ways than one. And hold on to your wallets! And watch your utility bills closely. Then pay attention again when you do vote on City Council races!

Anonymous,  March 26, 2015 at 6:58 PM  

I have yet to see any evidence that water and sewer districts are better at providing these services than cities. I've seen quite a bit of breathless hyperbole, and undeserved righteous indignation, but no talk about the flow of money.

Ronald Wastewater District, as anyone who has had to deal with them, had significant management shortcomings. Jettisoning the former general manager was a huge step in the right direction.

Take a look around at utility rates. Compare the rates cities charge for their utilities compared to water and sewer districts. Do your own research. Make up your own mind. Don't simply take the word of fake populists like Janet Way and Senator Chase. They apparently think the public is too stupid to vote in council members that make the right decisions. So they rely on vague, emotional arguments. Don't be sucked in by their baseless drivel.

Tom Jamieson March 27, 2015 at 11:45 AM  

Nowhere in the City's case for Ronald has been an accusation that it has been mismanaged. On the contrary, they have repeatedly sung the praises of Ronald's fine service to the community.The City's argument for assuming the District has been one of achieving synergies through consolidation. I don't accept that argument, of the 90,000 governments in this country, two thirds are special purpose districts. They have their place, something the City has never acknowledged. The citizens of this community created Ronald and should be able to vote on its future.

Anonymous,  March 27, 2015 at 2:04 PM  

@6:58, Your statements about the former GM are defamatory.Talk about baseless drivel. RWD's GM was terminated without cause. I am appalled the editor lets your comment stand.

Anonymous,  March 27, 2015 at 6:19 PM  

I agree with @2:04. Bogus accusations of $1000 office chairs and other lies from disgruntled souls with an ax to grind.

Anonymous,  March 27, 2015 at 9:06 PM  

Ah. Well, it takes more than simply "an axe to grind" for a majority of sitting commissioners to show a top-level manager the door. Speculate all you want about those axes, it seems those sitting at the grinding wheel and those in charge of the district came to the same conclusion, no?

Heh.

And Mr. Jamieson, why do you not accept the argument? Despite the lofty numbers you espouse, surely you understand that the reason for all those special purpose districts is BECAUSE there were no municipal entities established to provide those services. It does not mean that people at one time made a CHOICE to be served by these districts, as OPPOSED to the same services being provided by a city or county or whatnot. It's fun to use numbers though. Sounds real smart and stuff.

Tom Jamieson March 28, 2015 at 3:33 PM  

I do not accept the theoretical argument that a city-run utility is always better. Nor do I argue (as others have) that special purpose districts are superior. But Ronald works. And that is not theory. That is fact.

The City ignores the fact that Ronald already exists, and has operated successfully for over 60 years. It has more experience as a sewer utility than the City has as a city. The City thinks such experience can be transferred by an accounting journal entry. And it leaves out the cost of takeover. Its so-called Utility Unification Efficiency Study was concerned only with the cost of operation, not the cost of assumption, which to date has been huge. They tried to get Ronald to pick up the tab. Even the pro-city majority at Ronald balked at that.

The City has never taken an objective look at running a sewer utility. If it had it would have disclosed the complexity rather than the simplicity.

Institutional choices for service provision are complex. For each service, there are many decisions to be made in choosing the best service delivery option for a particular community.

Should the service be provided by the private, non-profit, or public sector?

If by public sector, should it be provided at the federal, state, or local level?

If at the local level, should the choice be made by local government officials, private developers, or metropolitan residents?
Once the decision has been made to provide the service through local government, and the decision maker has been decided, then and only then can a proper choice be made between special purpose government and general purpose government.

There are some 90,000 governments currently in existence in the United States. These include school districts, fire departments, utility districts, port authorities, library districts, cemeteries, and scores of others.

Special purpose governments provide substantial administrative and fiscal independence from general purpose local governments, thus limiting investment risk, and a dependency on fickle priorities based on competing interests for unrestricted funds.
Districts have their proper place in this vast array. They are the right choice in many cases. Counties, cities and special purpose districts are all biased in favor of their own self-preservation. They cannot be expected to make the institutional choices outlined above.

Only the state legislature and the citizens of the state have the ability and inclination to choose from the various institutional possibilities. And only the people of a particular community have the perspective and the right to make the local choice.

The people reserve the right to dismantle the instruments we have created, including our institutions. The people should not surrender to their county or city government the power to assume the assets of their special purpose districts and the operation of those assets. Nor should they give the special purpose districts they have created the authority to abdicate on their responsibility by handing over their jurisdiction to the cities. The exception would be subordinate governments created ex officio, but such is not the case here.

Past legislatures apparently have given local governments the power to horse trade our infrastructure, and this has caused much unrest and litigation within our communities. The GMA addresses the question of which urban services should be provided in rural areas, and which in urban areas. It is concerned with planning for optimal land use by selected counties and cities, not with optimal government.

This has been distorted like a game of telephone into a question of the demerits of special purpose districts. But such a question ought not be decided by rule. It must be decided in examination of the particulars, which is where assumption legislation always seems to originate.

Utility taxes are no more regressive than hamburgers, but I agree with Sen. Chase, utility assumption decisions should be left to the local control of the voters.

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