Smell test: Campaign mailer doesn’t fully capture Puyallup utility-rate hikes

Puyallup City Council races are heating up ahead of the general election Nov. 3.

Amid the fervor, claims about utility-rate hikes have surfaced in public meetings and campaign mailers, including one that targets Councilman John Palmer. He is seeking re-election for District 2 Position 1 against challenger Keith Sherrill.

Voters in Puyallup have received a postcard, distributed by an unknown sender, titled “The Black and White Truth You CAN’T Afford Palmer.” It makes several mostly vague claims, which Palmer says is part of a strategy to attack him with “erroneous statistics and misleading statements.” The first claim in the mailer has to do with utility taxes.

THE CLAIM: The postcard claims that the incumbent voted to raise utility rates four years in a row, including more than 28 percent for water alone.

THE FACTS: Palmer in early 2014 joined three other Puyallup council members to support a gradual hike in utility rates, spread out over four years.

The City Council approved the increase in a 4-3 vote. The majority, including Palmer, supported a 2.7 percent rate increase in 2014 for storm, sewer and water utilities, followed by similar increases over three more years. The increases were designed as a stair-step hike to keep pace with inflation.

The council also voted to raise water utility rates an additional 4 percent a year through 2017 to pay for replacement and repair of aging pipes and other infrastructure.

The baseline increases for all utilities vary each year based on the construction cost index, which relies on data from the previous year.

Based on that CCI index, Puyallup’s preliminary budget shows utility rates will increase an estimated 2.4 percent in 2016, following 2.7 percent hikes both this year and last.

Water rates will again go up next year an additional 4 percent, on top of the 2.4 percent base increase.

At the time the increases were approved, Palmer said the issue of lagging utility rates had been ignored for too long, and the water utility was “drastically underfunded.” He said the increases would help the city catch up after years of stagnant revenues, due to a four-year freeze in rates during the recession.

A staff report at the time showed Puyallup ratepayers spent about $21 per month on water on average while those in neighboring communities spent between $25 and $50.

In an interview Monday, Palmer reiterated his rationale for supporting higher rates. He stressed that the decision was an attempt to avoid “costly emergencies” that could result from a major failure of the water system.

The increases aren’t unreasonable, he added, because rates stayed the same during the recession and were minimally increased before that.

Puyallup Public Works Director Rob Andreotti echoed Palmer’s statements about the risk of emergencies.

Currently, he said funds aren’t immediately available to make any major capital repairs, should the need arise, which would force the city to rely on more costly bonds.

“We have infrastructure that’s over 100 years old,” Andreotti said. “That doesn’t mean it’s going to fail tomorrow, but it has the potential to.”

He said the temporary water rate increases would provide a funding source for vital capital projects.

CONCLUSION: The claim doesn’t account for the gradual nature of the utility increases and ignores previous rate freezes that caused the water system to be underfunded.

As for the claimed size of the increases, the city says it may become true if trends continue.

Water rates could be about 28 percent higher in 2017 than they were when the rate increase was approved last year, if the CCI index continues to increase by about 2 percent next year. City spokeswoman Brenda Arline said that’s more than likely.

“But we won’t know that for sure until later next year,” she said.

Kari Plog: 253-597-8682