CITY OF SEATTLE
ORDINANCE __________________
COUNCIL BILL __________________
title
AN ORDINANCE relating to Seattle Public Utilities; authorizing the General Manager/Chief Executive Officer of Seattle Public Utilities to execute the First Amended and Restated Contract between The City of Seattle and its long-term, full and partial requirements contract holders for the supply of water; authorizing the withdrawal of funds from the Water Fund Revenue Stabilization Subfund; providing budget authority to use such funds to provide payments to Water Utilities as required under the proposed contracts; amending Ordinance 127156, which adopted the 2025 Budget, including the 2025-2030 Capital Improvement Program; changing appropriations to various departments and budget control levels, and from various funds in the Budget; imposing a proviso; and ratifying and confirming certain prior acts; all by a 3/4 vote of the City Council.
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WHEREAS, Seattle, through its Water Fund, serves 16 cities and water utilities under long-term full and partial requirements contracts for water supply that were authorized in 2001 by Ordinance 120362 and in 2011 by Ordinance 123559; and
WHEREAS, these contracts have periodic reopeners to amend certain portions of the contracts, with the current reopener period concluding in 2025; and
WHEREAS, Seattle has completed negotiations with all 16 of the cities and water utilities to amend the 2001 and 2011 City of Seattle Full and Partial Requirements Contract for the Supply of Water; and
WHEREAS, the amendments provide: (a) certainty for Seattle and its contract holders via the automatic extensions of the contract term every 10 years and the expansion of stranded cost provisions; (b) flexibility and modernization via updates to many contract provisions; (c) expanded authority for the joint Seattle-customer Operating Board; and (d) the same contract for both partial and full requirements customers with each water utility’s specific requirements established in an exhibit to the amended contracts; and
WHEREAS, one of these contract updates provides for the direct return of up to $27,000,000 of past overpayments to the contract holders and this payment will affect the Water Fund’s financial policy performance; and
WHEREAS, the Water Fund Revenue Stabilization Subfund represents past overpayments by customers and Seattle intends to use these funds as the source of the payment to customers; and
WHEREAS, the withdrawal of Water Fund Revenue Stabilization Subfund will mitigate the impact on financial performance; and
WHEREAS, Ordinance 121761, passed on March 28, 2005, established a minimum balance for the Water Fund Revenue Subfund of $9,000,000, and permits funds in excess of this amount to be withdrawn, as authorized by ordinance of the City Council, with the anticipation that such withdrawn funds are to be used to meet operating expenses, pay Capital Improvement Program expenditures, or to comply with financial policies; and
WHEREAS, the current balance in the Water Fund Revenue Stabilization Subfund exceeds the minimum balance; and
WHEREAS, pursuant to the Proposed First Restated and Amended Contract with Water Utility for the Supply of Water, this return of overpayment will occur within 60 days of the execution of the First Restated and Amended Contracts with every Water Utility, which may occur in 2025 or 2026; NOW, THEREFORE,
BE IT ORDAINED BY THE CITY OF SEATTLE AS FOLLOWS:
Section 1. The General Manager/Chief Executive Officer (GM/CEO) of Seattle Public Utilities is authorized to enter into First Amended and Restated Contracts between The City of Seattle and the following Water Utilities for the Supply of Water: the Cedar River Water and
Sewer District, City of Bothell, City of Duvall, City of Mercer Island, City of Renton, Coal Creek Utility District, Highline Water District, North City Water District, Olympic View Water and Sewer District, Soos Creek Water and Sewer District, Water Districts 20, 49, 90, 119, 125, and Woodinville Water District in substantially the form of the contract attached to this ordinance as Attachment A, including any changes the GM/CEO deems necessary and that are consistent with the purposes of this ordinance.
Section 2. The GM/CEO of Seattle Public Utilities is authorized to make one or more withdrawals of funds in the amount of the payment to contract holders authorized under Attachment A, up to a maximum of $27,000,000, from the Water Fund Revenue Stabilization Subfund to Operating Cash.
Section 3. To pay for necessary costs and expenses incurred or to be incurred in 2025, but for which insufficient appropriations were made due to causes that could not reasonably have been foreseen at the time of the making of the 2025 Budget, appropriations for the following items in the 2025 Budget are increased from the funds shown, as follows:
|
Item |
Department |
Fund |
Budget Summary Level/BCL Code |
Amount |
|
3.1 |
Seattle Public Utilities |
Water Fund (43000) |
General Expense (43000-BO-SU-N000B) |
$27,000,000 |
|
Total |
$27,000,000 |
Unspent funds so appropriated shall carry forward to subsequent fiscal years until they are exhausted or abandoned by ordinance.
Section 4. This ordinance imposes a proviso as follows:
“Of the appropriations made by Section 3 of this ordinance, $27,000,000 is appropriated solely to pay the Water Utilities mentioned in Section 1 of this ordinance within 60 days of the First Amended and Restated Contracts authorized by Section 1 of this ordinance being signed with every Water Utility, and may be spent for no other purpose.”
Section 5. Any act consistent with the authority of this ordinance taken after its passage and prior to its effective date is ratified and confirmed.
Section 6. This ordinance shall take effect as provided by Seattle Municipal Code Sections 1.04.020 and 1.04.070.
Passed by a 3/4 vote of all the members of the City Council the ________ day of _________________________, 2025, and signed by me in open session in authentication of its passage this ________ day of _________________________, 2025.
____________________________________
President ____________ of the City Council
Approved / returned unsigned / vetoed this ____day of _______________, 2025.
____________________________________
Bruce A. Harrell, Mayor
Filed by me this ________ day of _________________________, 2025.
____________________________________
Scheereen Dedman, City Clerk
(Seal)
Attachments:
Attachment A - First Amended and Restated Contract Between The City of Seattle and [Water Utility] for the Supply of Water