4-Attachment C-Water System Plan Extension 2022.pdf

CITY OF OAK HARBOR

ISLAND COUNTY WASHINGTON

WATER SYSTEM PLAN EXTENSION

G&O #20599

JULY 2022

CITY OF OAK HARBOR

ISLAND COUNTY WASHINGTON

WATER SYSTEM PLAN EXTENSION

G&O #20599

JULY 2022

i

TABLE OF CONTENTS

CHAPTER 1 – WATER SYSTEM EXTENSION ANALYSIS

INTRODUCTION ................................................................................................................. 1-1

WATER SYSTEM IMPROVEMENTS ...................................................................................... 1-1 BASIC PLANNING DATA .................................................................................................... 1-2

Population ............................................................................................................ 1-2

SERVICE CONNECTIONS .................................................................................................... 1-3 WATER CONSUMPTION ..................................................................................................... 1-5

WATER PRODUCTION ........................................................................................................ 1-6 PLANNING PROJECTIONS ................................................................................................... 1-6

CHAPTER 2 – WATER USE EFFICIENCY

PREVIOUS WUE GOALS .................................................................................................... 2-1

Goal 1: Maintain DSL Below 10 Percent ........................................................... 2-1

Goal 2: Maintain Single-Family Residential Use at or Below 64 GPCD ........... 2-1

UPDATED WUE GOALS .................................................................................................... 2-3 Goal 1: Maintain DSL Below 10 Percent ........................................................... 2-3

Goal 2: Maintain Single-Family Residential Use at or Below 64 GPCD ........... 2-3 WUE MEASURES .............................................................................................................. 2-3

Source Metering and Meter Calibration .............................................................. 2-3

Service Metering, Inspection and Replacement................................................... 2-3 Leak Detection and Water Accounting ................................................................ 2-3

Customer Education ............................................................................................. 2-4 Continue with Conservation Rate Structure ........................................................ 2-4

Bills Showing Consumption History ................................................................... 2-4

Customer Leak Detection .................................................................................... 2-4 Purveyor Assistance ............................................................................................. 2-4

CHAPTER 3 – CAPITAL IMPROVEMENT PROGRAM

CAPITAL IMPROVEMENT PROJECT UPDATE ....................................................................... 3-1 RECOMMENDED IMPROVEMENTS ...................................................................................... 3-1

Water Rights and Source Capacity Projects ........................................................ 3-1 Transmission Line Projects .................................................................................. 3-2

Booster Station ..................................................................................................... 3-4

Distribution System Projects................................................................................ 3-4 Pressure Zone ....................................................................................................... 3-6

Summary of CIP Projects..................................................................................... 3-7

CHAPTER 4 – FINANCIAL PROGRAM

EXISTING WATER UTILITY FINANCIAL STATUS ................................................................ 4-1

Current Water Rates ............................................................................................. 4-1 PROJECT FUNDING SOURCE ALTERNATIVES ..................................................................... 4-4

Grants ................................................................................................................... 4-5 ii

Washington General Purpose Community Development Block Grant (CDBG) .............................................................................................. 4-5

US Economic Development Administration (US EDA) ......................... 4-5 Loans .................................................................................................................... 4-6

Public Works Trust Fund (PWTF) ........................................................... 4-6

Community Economic Revitalization Board (CERB) ............................. 4-6 Drinking Water State Revolving Fund (DWSRF) ................................... 4-7

Bonds ................................................................................................................... 4-8 Revenue Bonds ........................................................................................ 4-8

General Obligation Bonds........................................................................ 4-8

Other Funding Opportunities ............................................................................... 4-9 Utility Local Improvement Districts (ULIDs) ......................................... 4-9 iii

LIST OF TABLES

No. Table Page

1-1 Completed Projects Since the 2014 Plan CIP ...................................................... 1-2

1-2 2013-2020 Population and Consumption............................................................. 1-3 1-3 2020 Service Connection Summary..................................................................... 1-4

1-4 2020 ERU Calculation Summary......................................................................... 1-4

1-5 ERU by Customer Class ...................................................................................... 1-5 1-6 2013-2020 Water Consumption ........................................................................... 1-5

1-7 2013-2020 Retain Service Area Source Production ............................................ 1-6 1-8 Retain Service Area Projected Water Consumption and Production................... 1-7

2-1 2013-2020 Distribution System Leakage Summary ............................................ 2-2

3-1 Source Related Capital Improvement Project Summary ..................................... 3-2 3-2 Transmission Main Related Capital Improvement Project Summary ................. 3-3

3-3 Distribution System Related Capital Improvement Project Summary ................ 3-6 3-4 Projected Capital Improvement Project Schedule ............................................... 3-8

4-1 Water Service Rates Through 2015 ..................................................................... 4-1

4-2 Historical Revenues and Expenditures for Water Fund 401 ................................ 4-3 4-3 projected Revenues and Expenditures for Water Fund 401................................. 4-4

LIST OF FIGURES

No. Figure Follows Page

1-1 Existing Facilities Schematic Diagram ................................................................ 1-2

1-2 Existing Facilities Map ........................................................................................ 1-2 1-3 Existing Pressure Zone Schematic ....................................................................... 1-2

3-1 CIP Project Map ................................................................................................... 3-8

APPENDICES

Appendix A – Updated City Plans and Programs

Appendix B – Water Rights Self-Assessment

City of Oak Harbor 1-1

Water System Plan Extension July 2022

CHAPTER 1

WATER SYSTEM EXTENSION ANALYSIS

INTRODUCTION

In accordance with the Washington Administrative Code (WAC) 246-290-100 and the

Washington State Department of Health (DOH), water systems are required to prepare plans. The City of Oak Harbor prepared a plan that was approved in 2014 for a period of six years, the regulatory approval period at the time. Since that time, DOH has increased the planning period for new plans to 10 years. Recent six-year plans have the option of seeking a four-year extension of the existing plan. This plan extension has been prepared to update the 2014 City of Oak Harbor Water System Plan to allow the existing plan to be valid for an additional four years to 2024. The purpose of this document is to document changes to the water system since the preparation of the 2014 plan and to verify that the assumptions in the 2014 plan are still valid. In addition to the planning information in this chapter, other chapters include updates to the water use efficiency program and the capital improvement plan, as well as updated financial information.

This chapter includes a comparison of basic planning data that allows for an assessment of the city’s water demands and growth to verify the 2014 projects are still valid.

Information is included regarding historical and projected population data, historical and projected water production and consumption, and projected water production and demand.

WATER SYSTEM IMPROVEMENTS

As part of this extension, the City also updated its Capital Improvement Project (CIP) schedule. The City’s source characteristics, water treatment, storage, data collection, and the distribution system remain largely as described in the 2014 Plan. Four projects were completed since 2014, these projects are described below in Table 1-1.

Gray & Osborne, Inc., Consulting Engineers

1-2 City of Oak Harbor

July 2022 Water System Plan Extension

TABLE 1-1

Completed Projects Since the 2014 Plan CIP

(1) Project numbers are from the 2014 Plan.

The biggest change in the operation of the Oak Harbor water system was the creation of the 328 Pressure Zone. The 328 Pressure Zone is fed by the Ault Field booster station and the newly installed north reservoir. From the 328 Pressure Zone, the water cascades through the PRVs at Goldie Road and Gun Club Road into the 307-pressure zone and eventually through another set of PRVs, into the 243 Pressure Zone downtown. This

Change is shown in Figures 1-1, 1-2, and 1-3.

BASIC PLANNING DATA

In order to evaluate the validity of extending the use of the 2014 Water System Plan by 4 years, the plan’s projected population and consumption for the previous planning period must be compared to the corresponding historical values from actual City data.

Information on connections, monthly water production and purchasing, and monthly water consumption was provided by the City. Data was extracted from water profile reports, metered data, and billing information records.

POPULATION

The projected and historical service area population is summarized in Table 1-2. The average day consumption increased slightly over the period but was much less than what was projected in the 2014 plan.

Project Status or

Year

Completed ID(1) Title Description

T-4 24-inch Transmission Line Investigation

Transmission line reliability and soundness study

New Intertie between the

10-inch and 24-inch on the island side of the bridge

12-inch rock bridge intertie 2018

Telemetry consultation for upgrading

Telemetry preliminary study 2021

BS-2

Ault Field Booster Station

Pump Replacement

Replacement of two Ault Field

Booster Pumps

O A K H A

R B

O R

LEGEND

LEGEND

INCOMING LINE

FROM CITY OF

ANACORTES

EASTSIDE

RESERVOIR NO. 1

REDWING BOOSTER

STATION

WESTSIDE

RESERVOIRS

1 & 2

HELLER

BOOSTER STATION

ZONE

ZONE

AULT FIELD

BOOSTER STATION

ZONE

ZONE

ZONE

ZONE

ZONE

NORTH

RESERVOIR

GUN CLUB ROAD

PRV

GOLDIE ROAD

PRV

City of Oak Harbor 1-3

TABLE 1-2

2013-2020 Population and Consumption

Population Average Day Consumption (mgd)

Projection(2) Historical Projection(2) Historical

2013 22,080 22,080 1.305 1.24

2014 22,266 21,940 1.318 1.24

2015 22,454 22,000 1.387 -(1)

2016 22,644 22,410 1.455 1.43

2017 22,835 22,840 1.524 1.30

2018 23,027 22,780 1.593 1.30

2019 23,222 22,970 1.662 1.30

2020 23,418 22,910 1.676 1.27

(1) Data were not available.

(2) 2014 WSP projection.

SERVICE CONNECTIONS

The number of service connections in each customer class was estimated to increase at an annual rate of 1 percent. By doing this, the total estimated number of connections in

2020, 2033 and 2060 is 5731, 8,111 and 10,609, respectively. 2020 historical multi-residential services were significantly lower than the projected services due to multi-residential services been moved to residential services leading to increased residential services as shown in Table 1-3. The City’s projected and existing water connections for

2020 are summarized in Table 1-3.

1-4 City of Oak Harbor

TABLE 1-3

2020 Service Connection Summary

Category Projected(1) Historical

Residential 4710 4796

Multi-Residential 831 292

Commercial 347 285

Multi-Commercial 122 118

School 47 24

Hotel/Motel 10 10

Church 27 23

Sprinklers 123 110

Commercial/Residential 17 17

Irrigation 128 56

Hydrant Meters -(2) -(2)

NASWI 10 1

Total 6372 5731

(1) 2014 WSP Projection.

(2) Data not available.

Table 1-4 outlines the data and calculations used to estimate the 2020 consumption per ERU for the City. The average water demand for 2020 is approximately 136 gpd/ERU, a value lower than the 2014 Plan ERU value of 150 gpd/ERU. This value is within the typical range for a municipal water system of comparable size to Oak Harbor.

TABLE 1-4

2020 ERU Calculation Summary

Parameter 2020

SFR consumption (gpd) 650,959

SFR Water connections (ERU) 4,796

SFR water Use (gpd/ERU) 136

City of Oak Harbor 1-5

TABLE 1-5

ERU By Customer Class

Year Residential Multi residential Commercial Irrigation

All

Others Totals

2016 4,460 2,460 1,041 641 907 9,508

2017 4,494 2,387 1,048 667 967 9,563

2018 4,533 2,399 1,058 558 991 9,539

2019 4,442 2,349 1,315 473 993 9,573

2020 4,786 2,172 969 606 806 9,339

Historical numbers of ERUs by customer class within the service area are shown in Table 1-5. To get the number of service area ERUs, the annual total water consumption was divided by the ERU value of 136 gpd per ERU (Table 1-4).

WATER CONSUMPTION

Table 1-6 below compares the projected annual water consumption to the actual annual consumption for both, the retail service area and the naval base. The 2014 Plan projected consumption increasing slightly every year, while the actual consumption fluctuated but didn't show a clear trend. Both the RSA and NASWI consumption values were well below the 2014 Plan projections.

TABLE 1-6

2013-2020 Water Consumption

Million Gallons

Total RSA Consumption NASWI Consumption

Projection(1) Historical(2) Projection(1) Historical(2)

2013 476.3 451.62 290 225.13

2014 481 451.06 290 202.36

2015 506.2 - 3) 290 -(3)

2016 532.7 520.64 290 234.46

2017 556.4 474.81 290 211.99

2018 581.5 473.51 290 210.74

2019 606.7 475.23 290 208.98

2020 613.4 464.49 297.5 225.53

(1) Based on projected total RSA consumption from 2014 WSP.

(2) Historical values are from the annual consumption by customer class total.

(3) Data were not available.

1-6 City of Oak Harbor

July 2022 Water System Plan Extension

WATER PRODUCTION

Table 1-7 shows the projected and historical average daily demand (ADD) for the retail service area between 2015 and 2020. The actual use during 2015 to 2020 was fairly level with higher use in 2020, although the usage during the period was below the values projected in the 2014 plan.

TABLE 1-7

2013-2020 Retail Service Area Source Production

RSA ERUs ADD (mgd)(1) MDD (mgd)(1) PHD (gpm)(1)

Projection(3) Historical Projection(3) Historical Projection(3) Historical Projection(3) Historical

2013 9,233 -(2) 1.385 1.37 2.493 -(2) 2,839 -(2)

2014 9,323 -(2) 1.398 1.43 2.517 -(2) 2,867 -(2)

2015 9,798 -(2) 1.470 -(2) 2.645 2.63 3,012 -(2)

2016 10,274 9,508 1.541 1.44 2.774 2.97 3,159 3,368

2017 10,750 9,563 1.613 1.47 2.903 2.61 3,306 2,956

2018 11,227 9,539 1.684 1.42 3.031 -(2) 3,452 - (2)

2019 11,706 9,573 1.756 1.36 3.16 2.24 3,599 2,540

2020 11,804 9,339 1.771 1.39 3.187 2.41 3,630 2,736

(1) Includes DSL.

(2) Data were not available.

(3) 2014 WSP projection.

Table 1-7 also compares the projected maximum daily demand to the actual (historical) recorded maximum daily demand for the retail service area. The maximum daily demand

(MDD) is the single day out of the year in which the city supplied the most water to the retail service area. The projected MDD steadily increased from 2013 to 2020. The actual

MDD increased between 2015 and 2016, then began to steadily decline to well below the 2015 MDD before slightly increasing from 2019 to 2020. Despite this increase in the final year, the actual MDD and ADD remain well below the projected MDD and ADD showing that the projections can continue to be applied moving forward.

PLANNING PROJECTIONS

Since the actual consumption and production values remain below the projected consumption and production values, the water use projections in the 2014 Plan can continue to be applied for the 4-year extension. 2014 WSP projections for population, ERUs, average day consumption, ADD, MDD, and PHD for 2022 through 2025 and

2060 are summarized in Table 1-8. These projections include demands for residents living in the City of Oak Harbor.

City of Oak Harbor 1-7

TABLE 1-8

Retail Service Area Projected Water Consumption and Production

Retail

Service

Area

Population

Retail

Service

Area

ERUs

Average

Daily

Consumption

(gpd)(1)

DSL

(gpd)(2)

Average

Daily

Production

(gpd)

Maximum

Daily

Production

(gpd)(3)

Peak

Hour

Demand

(gpm)(4)

2021 24,313 11,265 1,690,000 95,910 1,786,000 3,214,000 3,660

2022 24,513 11,357 1,704,000 97,120 1,801,000 3,241,000 3,691

2023 24,714 11,450 1,717,000 98,330 1,816,000 3,268,000 3,722

2024 24,916 11,544 1,732,000 99,550 1,831,000 3,296,000 3,754

2025 25,121 11,639 1,746,000 100,800 1,847,000 3,324,000 3,786

2030 26,169 12,124 1,819,000 107,000 1,926,000 3,466,000 3,947

2033 26,819 12,425 1,864,000 110,700 1,975,000 3,554,000 4,048

2060 33,472 15,508 2,326,000 128,200 2,454,000 4,418,000 5,032

(1) Based on population projections and 69 gpcd.

(2) Assumed to be 80 percent of the estimated DSL for the entire service area.

(3) Estimated as 1.8 * ADD + DSL.

(4) Estimated as 1.64 * maximum daily production.

At the end of 2025, the conclusion of the 4-year extension period, the City of Oak Harbor is projected to have a population of 25,121 people, 11,639 ERUs, an average day consumption of 1,746,000 gallons, 100,800 gallons of daily DSL, an average day demand of 1,847,000 gallons, a maximum day demand of 3,324,000 gallons, and a peak hour demand of 3,786 gallons per minute.

City of Oak Harbor 2-1

CHAPTER 2

WATER USE EFFICIENCY

Water Use Efficiency (WUE) is a key component to the City of Oak Harbor WSP extension. The following chapter presents the City’s water use efficiency plan which is a requirement of water system planning per WAC 246-290. The WUE program provides information on program development and implementation, recommended measures and compliance with the Municipal Water Law (MWL).

PREVIOUS WUE GOALS

The City adopted a water use efficiency program as part of the 2014 WSP. The program had two WUE goals that targeted production and consumption. These goals were:

GOAL 1: MAINTAIN DSL BELOW 10 PERCENT

The first goal of the City’s WUE Program was to maintain DSL at a 3-year rolling average of less than 10 percent. In 2020, the City’s three year rolling average DSL was

7.23 percent. Since 2016, the City’s average annual DSL was 6.84 percent as summarized in Table 2-1 and the three rolling average for 2020 was 7.53 percent.

GOAL 2: MAINTAIN SINGLE-FAMILY RESIDENTIAL USE AT OR BELOW

64 GPCD

The second goal of the City’s WUE Program was to maintain family household use at or below 64 gpcd based on a 3-year average. A secondary goal was to reduce irrigation usage. Based on historical data, the 3-year average single-family residence water usage within the retail service area was 67 gpcd. Furthermore, since 2016, the City had reduced its irrigation usage by approximately 6 percent, from 32 million gallons to 30 million gallons in 2020.

2-2 City of Oak Harbor

TABLE 2-1

2013-2020 Distribution System Leakage Summary

Production, gal/yr

Consumption, gal/yr

DSL (production -consumption), gal/yr DSL %

3-year

Rolling

Average

2013 500,727,540 451,624,880 49,102,660 9.81% -

2014 522,351,269 451,056,839 71,294,430 13.65% -

2015 -(2) -(2) -(2) -(2) -(2)

2016 524,817,995 520,635,509 4,182,486 0.80% -

2017 537,725,469 474,814,522 62,910,947 11.70% -

2018 519,679,992 473,513,419 46,166,573 8.88% 7.13%

2019 495,760,443 475,228,819 20,531,624 4.14% 8.24%

2020 508,507,257 464,489,679 44,017,578 8.66% 7.23%

Average 515,652,852 473,051,952 42,600,900 6.84%(1) 7.53%

(1) DSL average for 2016 – 2020.

(2) Data were not available.

To meet these goals, the City implemented the following measures:

1. Preventative meter and piping replacement and installation;

2. Implementation of monthly billing statement to more clearly show water use and water use trends;

3. Modification of water rates to encourage conservation measures; and

4. Consistent and regular source meter monitoring.

A variety of external measures targeted for consumers were also implemented and included:

1. Distribution of free or cost-reduced conservation kits;

2. Promotion of plants and vegetation that are adapted to the city’s climate zone; and

3. Public conservation education outreach.

City of Oak Harbor 2-3

UPDATED WUE GOALS

Under the WUE Rule, the City must set water use efficiency goals and measure progress each year toward meeting these goals. The WUE goals for the City of Oak Harbor for 2022 through 2025 include:

GOAL 1: MAINTAIN DSL BELOW 10 PERCENT

The first goal is to maintain DSL at a 3-year rolling average of less than 10 percent.

GOAL 2: MAINTAIN SINGLE-FAMILY RESIDENTIAL USE AT OR BELOW

64 GPCD

The second goal of the City’s RUE Program is to maintain family household use at or below 64 gpcd based on a 3-year average. A secondary goal is to reduce irrigation usage.

WUE MEASURES

WUE requires the evaluation and implementation of water use efficiency measures to help meet the WUE goals. Because the city serves between 10,000 and 49,999 customers, they are required to evaluate or implement a minimum of nine supplementary water use efficiency measures. The following sections describe water use efficiency measures evaluated, and indicate which have been, or will be implemented by the City.

SOURCE METERING AND METER CALIBRATION

Source meters have been installed at all active sources and are evaluated and calibrated at least every 2 years.

SERVICE METERING, INSPECTION AND REPLACEMENT

All water users including public and City facilities have individual service meters.

Service meters vary in size according to the needs of the individual customer, and all new service connections are installed according to the City’s developer standards. Meters are inspected regularly as part of the City’s preventive maintenance program and replaced as necessary.

LEAK DETECTION AND WATER ACCOUNTING

The city maintains a 3-year rolling average DSL of approximately 8 percent, which is below the regulatory threshold of 10 percent. The City staff does track unbilled water, such as water used for water main and tank flushing, street cleaning, or other maintenance uses.

2-4 City of Oak Harbor

CUSTOMER EDUCATION

The City has several different brochures regarding conservation and efficient water use available on its website and also available in hard copy at City Hall. The City staffs educational booths at selected fairs and gatherings, and advertises conservation tips on local cable Channel 10.

CONTINUE WITH CONSERVATION RATE STRUCTURE

The City has adopted policies for the establishment of water rates and adjusted future water service rates accordingly. Chapter 4 (Financial Analysis) shows rates set for water service by the City of Oak Harbor Water utility. An inclined block water service rate structure to fund water system improvements and system maintenance is part of the current rates. These rates are tiered so that water service fees are assessed based on the amount of water consumed. This rate structure is being implemented across seven different customer classes, and therefore, counts as seven water use efficiency measures.

BILLS SHOWING CONSUMPTION HISTORY

The City includes consumption history on all bills to its customers. The City currently bills on a monthly basis and uses Eden billing software, which has the capability to include historic water use on billing statements. Currently, water use graphs for the most recent 12-month period, as well as the water usage and water consumption rate are indicated on customer billing statements.

CUSTOMER LEAK DETECTION

The City’s billing department monitors customers’ water bills for abnormally high water use volumes. When a measurement occurs that is outside the range of normal use, the customer is notified of a potential leak on their side of the water meter. This detection and monitoring capability is also bolstered through the use of AMR equipment, which allows for nearly real-time monitoring of water consumption.

PURVEYOR ASSISTANCE

Conservation and efficient water use efforts made by the City intended for residential customers will be extended to the connections in these systems as well and will begin with educational outreach and support.

City of Oak Harbor 3-1

CHAPTER 3

CAPITAL IMPROVEMENT PROGRAM

This chapter presents a Capital Improvement Program (CIP) in accordance with the requirements of WAC 246-29. A number of CIPs from the 2014 plan have been completed and were noted in Chapter 1.

CAPITAL IMPROVEMENT PROJECT UPDATE

As of February 2020, four CIPs from the 2014 WSP have been completed. These projects include corrosion study of the 24-inch transmission main under the Deception Pass

Bridge, new intertie between the 10 inch and 24 inch on the island side of the bridge, telemetry upgrade consultation, and Ault field pump replacement.

RECOMMENDED IMPROVEMENTS

WATER RIGHTS AND SOURCE CAPACITY PROJECTS

Three water rights and source capacity CIPs are being recommended as part of the 2022

WSP extension. These include:

• S-1: Well 9 Replacement

This project includes removing the pumping equipment from the existing

Well 9. A new 10-inch diameter well will be drilled directly adjacent to the existing well location and new casing and screen will be installed.

Existing pumping equipment and building will be inspected and reused if possible. Estimated project cost: $291,299

• S-2: Water System Plans and Studies

It is anticipated that a new well and associated peripheral items will be necessary to provide the required volume of groundwater for emergency supply for the city and its customers. An Emergency Water Supply Study will investigate the possible location and size of an emergency source.

Also funded under this item is the Water System Plan Extension and the

Risk Assessment and Emergency Response Plan. Estimated project cost: $464,000

• S-3: Eastside Reservoir Demolition

This project includes decommissioning and demolition of the existing

Eastside Reservoir. The reservoir was constructed in 1949 and does not

3-2 City of Oak Harbor

July 2022 Water System Plan Extension have a foundation structure. Retrofitting this reservoir or modifications to meet current seismic requirements are not cost-effective. Estimated project cost: $110,000.

• S-4: North Reservoir Cathodic Protection

The North Reservoir currently does not have induced current cathodic protection. Due to the reservoir being new, the manufacturer required cathodic protection not to be installed for 5 years after construction to allow for coating curing. Cathodic protection protects the reservoir from internal corrosion. Cathodic protection is installed on all other City water reservoirs. Estimated project cost: $30,000.

TABLE 3-1

Source Related Capital Improvement Project Summary

No. Project

Estimated

Construction

Date

Estimated

Cost

S-1 Well 9 Replacement 2022 $291,299

S-2 Water System Plans and Studies 2022 $464,000

S-3 Eastside Reservoir Demolition After 2026 $110,000

S-4 North Reservoir Cathodic Protection System 2022 $30,000

TRANSMISSION LINE PROJECTS

• T-1: West 384 Zone Extension: Phase 1

This project includes piping and appurtenances that would help create the

West 384 pressure zone. The project includes approximately 5,300 feet of

24-inch ductile iron transmission main from the North Reservoir across undeveloped land west of the termination of Gun Club Road to North

Heller Road. The pipe would then continue south to the intersection of

NW Heller Street and NW Crosby Avenue. Estimated project cost:

$3,015,000

• T-2: SR 20/Campbell Lake Road Roundabout/Fish Passage Water Main

Replacement

This project will replace approximately 3,100 feet of 24-inch ductile iron transmission main with 24-inch HDPE pipe along the eastern shores of

Lake Campbell. A corrosion survey in 2007 revealed that mildly corrosive soils along the shore of Lake Campbell on Fidalgo Island have begun to damage the transmission main. The existing ductile iron pipe is

City of Oak Harbor 3-3

Water System Plan Extension July 2022 located under the northbound traffic lane of Highway 20. Ideally, the new

HDPE pipe will be located within a new utility easement adjacent to the existing right-of-way. This project will require the acquisition of necessary permits and easements required to install new pipe in this location. Estimated project cost: $600,000

• T-3: Wet Fiber 24-Inch Transmission Leak Detector

Purchase and install leak detection software/hardware for Craley Group pipe within a pipe fiber optic cable.

• T-4: Wet Fiber Phase 3

Install fiber optic cable inside of transmission main from the “rock bridge inter-tie” to the North Reservoir.

• T-5: Cross City Transmission Main

Project T-5 is further split into two projects. T-5A and T-5B. In total, Project T-5 is required to create the East 384 Pressure Zone and will include the installation of approximately 8,200 linear feet of 18-inch ductile iron pipe between the North Reservoir and West Crescent Road.

The estimated total cost for T-5 is $3,600,000 but this will be a project funded by the US Navy.

Project T-5A will connect to the existing transmission main at the intersection of Gun Club Road and North Oak Harbor Road and will head east along Gun Club Road, south along NE Goldie Road and terminate at the intersection of NE Goldie Road and NE 16th Street.

Project T-5B will provide an additional connection point that will allow the City to serve the NASWI Seaplane Base facilities. This project will extend the T-5A 18-inch main east along NE 16th Street and south along

NE Regatta Drive to the intersection of NE Regatta Drive and West

Crescent Harbor Road.

3-4 City of Oak Harbor

TABLE 3-2

Transmission Main Related Capital Improvement Project Summary

Construction

Date Estimated Cost

T-1 West 384 Zone Extension: Phase 1 2024 $3,015,000

T-2 Campbell Lake Main Replacement 2022/2023 $600,000

T-3 Wet Fiber 24-Inch Transmission Leak Detector 2024 $410,000

T-4 Wet Fiber Phase 3 2023 $600,000

T-5 Cross City Transmission Main 2024-2025 US Navy Funded

BOOSTER STATION

• BS-1: Ault Field Pump Station VFD Replacement

This project includes two new VFD motor starters at Ault Field to replace the existing units. Estimated project cost: $100,000

• BS-2: North Booster Pump Station

This project includes the construction of a new booster station at the location of the North Reservoir. The booster station will pump water from the North Reservoir to the proposed 384 East and West Pressure Zones.

The booster station will include a new concrete masonry unit (CMU) building that will house horizontal split case pumps to handle the City's projected water demands to the proposed East 384 and West 384 Pressure

Zones. Space and electrical connections will be provided for two additional pumps to be installed as system demands increase. The project will provide pressure and flows necessary to serve the NASWI Seaplane

Base portion of the Navy's water distribution system. Estimated project cost: $2,398,000 but this project will be funded by the US Navy.

DISTRIBUTION SYSTEM PROJECTS

Eight distribution system CIPs outlined in the 2014 plan are being recommended as part of the extension. These include:

• DS-1: NE Regatta Drive Pipeline Replacement

This project includes installation of 300 feet of 8-inch DI pipe to replace the existing 6-inch asbestos cement pipe between East Whidbey Avenue and NE 1st Avenue. This project is part of the City’s regular pipe

City of Oak Harbor 3-5

Water System Plan Extension July 2022 replacement schedule and will improve local pressures and fire flow in the area surrounding the project. Estimated project cost: $250,000

• DS-2: Glencoe Street Fire Flow Improvements

This project will replace 4-inch-diameter asbestos-cement pipe on SE

Glencoe Street with new 8-inch-diameter ductile iron pipe. This project includes installation of approximately 2,400 feet of 8-inch ductile iron pipe along SE 4th Avenue between SE Midway Boulevard and SE Glencoe

Street, and along SE Glencoe Street between 4th Avenue and 40th NW

Street. This project will increase available fire flow in the immediate vicinity to levels above the required 1,000 gpm. Estimated project cost: $470,000

• DS-3: Erin Park Main Road Extension/Tie-In

This project includes the installation of approximately 1,100 feet of

12-inch water pipe along West Erin Park Road between North painters

Way and North Oak Harbor Road. It also includes approximately 350 feet of new 12-inch pipe from the end of West Oak Street to the new main along West Erin Park Road. This project will provide adequate fire flow to meet the 3,500-gpm requirement for businesses in this region of the

City.

Erin park Road Tie-In project includes a tie-in connection between the

12-inch ductile iron pipe in the North Goldie Road right-of-way to the existing 8-inch C900 parallel line at West Erin Park Road. This project will help provide adequate fire flow to meet the 3,500-gpm requirement for businesses in this region of the City. Estimated project cost: $755,000

• DS-4: NE 9th to Taftson Waterline Connection

This project includes a waterline connection between NE 9th Street to

Taftson Street. Estimated project cost: $70,000

• DS-5: Industrial Avenue Tie-In

This project includes a tie-in connection between the 12-inch ductile iron pipe in the Goldie Road right-of-way to the existing 8-inch PVC parallel line at Industrial Avenue. This project will help provide adequate fire flow to meet the 3,500-gpm requirement for businesses in this region of the City. Estimated project cost: $60,000

3-6 City of Oak Harbor

• DS-6: Marin Woods Waterline Upsize

The City is paying the material cost difference between the City standard water main size of 8 inches and the 16-inch water main that is being installed into the Marin Woods PRD in order to conform with the Water

System Plan. The Marin Woods PRD is located northerly of SW

Swantown Avenue and the westerly termini of SW Robertson and Putnam

Drive(s) in accordance with OHMC 13.28.020 (2)(d) as last amended by

Ord. 438 Section 10. Estimated project cost: $250,000

• DS-7: Steel/AC Pipe Replacement

This project will systematically replace the existing steel and asbestos-cement (AC) water pipes located throughout the City’s distribution system. The City currently has approximately 100,000 linear feet of old steel and AC pipes, which are typically undersized. Design for replacement of a portion of the City’s AC pipe will occur one year, and will be followed the next year by construction of the design replacement.

The design/construction process will then be repeated. This project is anticipated to occur biannually. Estimated project cost: $4,000,000

• DS-8: SCADA System Upgrade

Existing telemetry hardware is obsolete and no longer supported. The system uses outdated MOSCAD RTU technology that is no longer supported by the inter-grater and marketplace. The only way to acquire replacement hardware for current system is through third-party private sellers (eBay). Our current inter-grater has managed to keep the system running using used parts on hand.

Program software also needs to be updated to allow remote access to

SCADA system by water division after hours duty staff. Estimate project cost: $400,000

City of Oak Harbor 3-7

TABLE 3-3

Distribution System Related Capital Improvement Project Summary

Construction

Date

Estimated

Cost

DS-1 NE Regatta Drive Pipeline Replacement 2023 $250,000

DS-2 Glencoe Street Fire Flow Improvements 2022 $470,000

DS-3 Erin Park Main Road Extension/Tie-In After 2026 $755,000

DS-4 NE 9th to Taftson Waterline Connection 2024 $70,000

DS-5 Industrial Avenue Tie-In 2023 $60,000

DS-6 Marin Woods Waterline Upsize 2022 $250,000

DS-7 Steel/AC Pipe Replacement Annually $4,000,000

DS-8 SCADA Upgrade 2022 $400,000

PRESSURE ZONE

• PZ-1: West 384 Zone Development

These two small projects are part of a larger project that will help fully develop the West 384 Zone. The first is the installation of a 6-inch PRV station along SW 6th Avenue between SW Judson Drive and SW Harrier

Street. The second includes approximately 780 feet of new 8-inch-diameter ductile iron water pipe will replace the existing 6-inch asbestos-cement water pipe and connect SW Barrington Drive and SW London

Terrace. A new PRV station will also be included at this location.

This project also includes installation of an 8-inch check valve between the future west 384 Zone and the existing 307 Zone (Mainland Zone) break to provide additional fire flow to Oak Harbor High School from the

307 Zone. The valve will be installed near the intersection of NW 2nd

Avenue and SW Jib Street and will include a vault. Estimated project cost: $365,000

SUMMARY OF CIP PROJECTS

An updated CIP schedule, including estimated construction dates and estimated costs, are summarized in Table 3-4. An updated CIP map that shows locations of the proposed improvements is included as Figure 3-1.

3-8 City of Oak Harbor

TABLE 3-4

Projected Capital Improvement Project Schedule

Project

Construction Year Estimated

Cost 2022 CIP 2023 CIP 2024 CIP 2025 CIP 2026 CIP

BS-1 Ault Field Pump Station VFD Replacement $100,000 $100,000

BS-2 North Booster Pump Station (1)

DS-1 NE Regatta Drive Pipeline Replacement $250,000 $250,000

DS-2 Glencoe Street Fire Flow Improvements $470,000 $470,000

DS-4 NE 9th to Taftson Waterline Connection $14,000 $56,000 $70,000

DS-5 Industrial Avenue Tie-In (wtr2105) $60,000 $60,000

DS-6 Marin Woods Waterline Upsize $250,000 $250,000

DS-7 Steel/AC Water Main Replacements $500,000 $500,000 $500,000 $500,000 $500,000 $2,500,000

DS-8 Water System Telemetry Upgrades $400,000 $400,000

PZ-1 West 384 Zone Development $73,000 $292,000 $365,000

S-1 Well 9 Replacement $291,299 $291,299

S-2 Water System Plans and Studies $464,000 $464,000

S-4 North Reservoir Cathodic Protection $30,000 $30,000

T-1 West 384 Zone Extension Phase 1 $603,000 $2,412,000 $3,015,000

T-2 SR 20/Campbell Lake Road Roundabout/Fish Passage

Water Main Replacement $300,000 $300,000 $600,000

T-3 Wet Fiber 24-Inch Transmission Leak Detector $410,000 $410,000

T-4 Wet Fiber Phase 3 $600,000 $600,000

T-5 Cross City Transmission Main (1)

Total $2,805,299 $1,183,000 $1,819,000 $2,968,000 $500,000

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2022 WATER SYSTEM PLAN UPDATE

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CITY OF OAK HARBOR

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City of Oak Harbor 4-1

CHAPTER 4

FINANCIAL PROGRAM

This chapter contains analysis of the City’s ability to fund water system improvements outlined in Capital Improvement Program. Potential funding sources, financial status of the water utility, funding status of the water utility, and funding required to finance the scheduled improvements.

EXISTING WATER UTILITY FINANCIAL STATUS

CURRENT WATER RATES

The City’s current rate schedule is shown in Table 4-1.

TABLE 4-1

Water Service Rates Through 2015

Parameter 2010 2011 2012 2013 2014 2015

Monthly Base Rate

Residential, Residential/Commercial, School, and Irrigation

5/8" or 3/4" $22.25 $23.50 $24.25 $25.00 $25.50 $26.25

1" $27.80 $32.30 $36.40 $40.65 $44.65 $47.80

1-1/2" $55.65 $64.65 $72.75 $81.25 $89.20 $95.65

2" $89.00 $103.40 $116.40 $130.00 $142.80 $153.00

3" $166.90 $193.90 $218.25 $243.75 $267.75 $2,868.90

4" $278.15 $323.15 $363.75 $406.25 $446.25 $478.15

6" $367.15 $387.75 $400.15 $412.50 $420.75 $433.15

8" $587.40 $620.40 $640.20 $660.00 $673.20 $693.00

Multi-Family, Multi-Commercial

Per Base Unit Rate $18.90 $19.95 $20.60 $21.25 $21.70 $22.30

Additional Consumption Charges

Single-Family and Multi-Family (per unit)

0 - 3 CCF $1.65 $1.75 $2.10 $2.35 $2.60 $2.85

4 - 6 CCF $2.30 $2.55 $2.80 $3.15 $3.75 $4.30

> 7 CCF $4.10 $4.80 $5.45 $5.95 $6.35 $6.75

Commercial (per unit), Schools, and Churches (2)

0 - 10 CCF $4.40 $4.20 $4.25 $3.75 $3.45 $3.50

11 - 20 CCF $3.60 $3.80 $4.00 $3.75 $3.70 $3.75

> 21 CCF $2.35 $2.60 $3.15 $3.75 $3.95 $4.10

Irrigation

0 - 10 CCF $4.75 $4.50 $4.50 $4.20 $4.20 $4.45

> 11 CCF $2.55 $3.00 $3.60 $4.20 $5.00 $5.50

4-2 City of Oak Harbor

July 2022 Water System Plan Extension

The City maintains a single Water Fund 401. The 2013 through 2020 historical revenues and expenditures for Water Fund 401 are summarized in Table 4-2. The City accounts for the water utility as a self-supporting enterprise fund with revenues, expenses, debt, and reserves specified for water services. Monthly water sales are the primary source of revenue for maintenance and operations. New customers pay a combination of a one-time system development charge, meter installation and initiation fees. The City primarily pays for capital improvements on a pay-as-you-go basis. There is no outstanding long-term debt for the water utility.

City of Oak Harbor 4-3

TABLE 4-2

Historical Revenues and Expenditures for Water Fund 401

Parameter 2013 2014 2015 2016 2017 2018 2019 2020

Revenues

Start of Year Balance $5,145,382 $5,431,767 $10,103,269 $11,315,805 $11,945,030 $13,216,327 $13,890,242 $11,319,382

Total Revenues $5,123,033 $9,239,422 $6,173,426 $6,364,344 $7,016,453 $6,471,680 $6,790,156 $6,359,282

Expenditures

Total Expenditures $4,836,649 $4,567,919 $4,960,890 $5,735,120 $5,745,156 $5,797,765 $9,361,017 $6,173,626

Surplus /(Deficit) $286,385 $4,671,503 $1,212,536 $629,224 $1,271,298 $673,915 ($2,570,861) $185,656

End of Year Balance $5,431,767 $10,103,269 $11,315,805 $11,945,030 $13,216,327 $13,890,242 $11,319,382 $11,505,037

4-4 City of Oak Harbor

July 2022 Water System Plan Extension

The water fund finished 2020 with a $185,656 surplus and concluded with a positive year-end balance every year between 2013 to 2020.

The water fund’s revenue and expenses were projected for the 4-year planning horizon of the WSP extension and are summarized in Table 4-3. Revenue projections for the year

2022-2025 from connection/admin/other fees, miscellaneous revenues, and NASWI meter and maintenance revenues were assumed to increase with inflation at an annual rate of 3 percent. Projected expenditures for 2022-2025 are based on values for 2020 and adjusted for inflation at an annual rate of 3 percent.

TABLE 4-3

Projected Revenues and Expenditures for Water Fund 401

Parameter 2021 2022 2023 2024 2025 2026

Start Balance $11,505,037 $11,526,055 $8,632,594 $7,216,634 $5,514,397 $2,757,228

Total Water Fund

Revenues $6,410,156 $6,461,438 $6,513,129 $6,565,234 $6,617,756 $6,670,698

American Rescue Plan Funds $0 $0 $0 $500,000 $750,000 $500,000

Total Expenses $6,358,835 $6,549,600 $6,746,088 $6,948,471 $7,156,925 $7,371,633

CIP $30,303 $2,805,299 $1,183,000 $1,819,000 $2,968,000 $500,000

Surplus/(Deficit) $21,018 ($2,893,462) ($1,415,959) ($1,702,237) ($2,757,169) ($700,935)

End Balance $11,526,055 $8,632,594 $7,216,634 $5,514,397 $2,757,228 $2,056,293

Table 4-3 shows slowly increasing expenditures, with revenues rising accordingly including some American Rescue Plan funds the City has received and allocated to water projects. The fund has a surplus in 2021 and deficits in the remaining years when reserve funds will be used to fund CIP projects. Even with the use of reserve funds, the City will still have the necessary financial flexibility to continue their projected improvement schedule as well as providing funding for emergency projects, should the need arise by maintaining a positive year end balance.

PROJECT FUNDING SOURCE ALTERNATIVES

In addition to the pay-as-you-go method of financing capital improvements, seeking grants and selling revenue bonds, the City may also consider low-interest loans from the

Public Works Trust Fund (PWTF) or the Drinking Water State Revolving Fund

(DWSRF). These funds are available for eligible municipalities with system improvement projects that meet their listed criteria. A variety of capital improvement funding sources are briefly discussed below.

Grants: Island County Community Development Block Grant (CDBG)

US Economic Development Administration (US EDA)

City of Oak Harbor 4-5

Water System Plan Extension July 2022

Loans: Public Works Trust Fund (PWTF)

Community Economic Revitalization Board (CERB)

Drinking Water State Revolving Fund (DWSRF)

USDA Rural Development (RD)

Bonds: Revenue Bonds

General Obligation Bonds

Other: Utility Local Improvement Districts

GRANTS

Grant funding is a good source of capital funding because the money does not have to be repaid. Some of the grants that may be available to the City are Federal grants, the Clean

Water State Revolving Fund (CWSRF), the Drinking Water State Revolving Fund

(DWSRF), and Performance Partnership grants (PPG). The City should continue to pursue grants when appropriate, considering matching requirements, and availability.

Washington General Purpose Community Development Block Grant (CDBG)

The CDBG program is a competitive source of federal funding for a broad range of community development projects. A primary requirement of the CDBG program is that the project must principally benefit at least 51 percent of the low-to-moderate income residents of the project area. CDBG has two programs including General Purpose and

Planning Only. The General Purpose program provides grant funds for the design, construction, or reconstruction of water and sewer (among others) systems up to the amount of $750,000. The Planning Only program includes projects such as comprehensive plans, community development plans, capital improvement plans, and other plans such as land use and urban environmental design, economic development, floodplain and wetlands management, transportation, and utilities. Planning Only grants are limited to $24,000 for a single applicant or $40,000 for a joint applicant. Eligible applicants for the CDBG programs include cities and towns with less than 50,000 people or counties with populations less than 200,000.

US Economic Development Administration (US EDA)

US EDA offers competitive grants up to $1 million for projects within Region 10.

Projects are selected locally by an economic development district and submitted to

Congress for competitive selection among other regions in the US. Similar to CERB, applicants must have an industrial partner ready to proceed or a feasibility study to provide evidence that the proposed project establishes realistic job creation.

4-6 City of Oak Harbor

LOANS

Public Works Trust Fund (PWTF)

The PWTF is a revolving loan fund designed to help local governments finance public works projects through low-interest loans and technical assistance. The PWTF, established in 1985 by legislative action, offers loans substantially below market rates, payable over periods ranging up to 20 years. To be eligible for the PWTF programs, an applicant must be a local government such as a city, county, or utility district. PWTF has four loan programs including Construction, Preconstruction, Planning, and Emergency.

The Construction Program accepts applications once per year in the spring, and the money becomes available approximately one year later. The Preconstruction and

Planning programs are open on a year-round basis and must be submitted to the Public

Works Board prior the 15th of the month to be reviewed at the next Board meeting.

These funds become available shortly after the Public Works Board makes their final decision as to the award. Emergency projects must have a locally declared emergency and are applied for on an open cycle depending on the availability of funds. Project expenditures are reimbursable from the date of the declared emergency.

An applicant must have a long-term plan for financing its public work’s needs. If the applicant is a county or city; it must adopt the 1/4 percent real estate excise tax that is dedicated to public works construction projects. Eligible public works projects include streets and roads, bridges, storm sewers, sanitary sewer collection and treatment systems, and domestic water. Loans are presently offered only for purposes of repair, replacement, rehabilitation, reconstruction, or improvement of existing eligible public works systems. Eligible project costs can include expenses related to serving 20-year forecasted growth as identified in a growth management comprehensive plan.

Since substantially more trust fund dollars are requested than are available, local jurisdictions must compete for the available funds. The applications are carefully evaluated, and the Public Works Boards submits a prioritized list of those projects to the

Legislature that are recommended to receive low-interest financing. The Legislature reviews the list and indicates its approval through the passage of an appropriation from the Public Works Assistance Account to cover the cost of the proposed loans. Once the

Governor has signed the appropriation bill into law (an action that usually occurs by the following…