Two south King County water and sewer districts with customers in the Covington and Maple Valley areas are suing King County for allegedly spending to much money the wrong way on sewer projects.
In a lawsuit filed Aug. 6 in Pierce County Superior Court, Soos Creek Water and Sewer District and Cedar River Water and Sewer District claim King County improperly spent millions of dollars of sewer revenues, mostly associated with the county’s new Brightwater sewage treatment plant that’s located in south Snohomish County near Woodinville.
The districts said they have long-term contracts with King County under which the districts pay the county to treat sewage. King County’s use of those sewer revenues is limited by those contracts, the county charter and state and local law, according to the districts. The districts allege that the county breached the contracts and violated laws by improperly:
• Using the revenues to make improper payments to Snohomish County.
• Spending sewer revenues to cover general government expenses and other expenses unrelated to sewage disposal.
• And using sewer revenues to pay for building infrastructure for an unauthorized water utility system for the distribution and sale of reclaimed water from the Brightwater project.
The districts said they’re seeking reimbursement of funds from King County to the wastewater fund and from the fund to the districts and other local sewer utilities.
King County officials declined commenting on the lawsuit.
“We don’t respond on active litigation,” said Natasha Jones, a spokeswoman for County Executive Ron Sims.
Soos Creek Water and Sewer District encompasses 35 square miles and serves about 100,000 people in southeast King County, including the Covington area.
Cedar River Water and Sewer District serves customers in area of approximately 14.5 square miles, including Maple Valley, Fairwood and Hobart areas.
According to the districts, the county’s use of sewer revenues is strictly limited. The sewage contracts between the districts and the county require sewer revenues charged to the districts to be spent only “for the disposal of sewage,” district officials said.
Similarly, the county charter prohibits sewer revenues from being used for any purpose other than operating expenses, debt repayment, capital improvements, and the reduction of rates and charges. State law requires that any assets transferred from or service provided by King County’s Wastewater Treatment Division (WTD) to other county or non-county governmental bodies are to be paid for at their true and full value, and no other county or non-county governmental body is to benefit financially from the WTD’s sewer revenues. The charter and state law provisions are in the county’s wastewater code, and the county has pledged to its sewer bondholders that all sewer revenues will be used only for specified purposes relating to the county’s sewer system, the districts claim.
The districts allege in their lawsuit that King County illegally agreed to pay Snohomish County $70 million for projects which weren’t identified in the county’s environmental impact studies and don’t mitigate any direct impacts caused by Brightwater. That money, the districts said, was on top of the $88 million the county had already committed to spend on mitigation of adverse environmental impacts of Brightwater (over half of that money was committed to Snohomish County).
The additional $70 million was used to induce Snohomish County to drop its opposition to Brightwater and grant King County the permits needed for the project, the districts claim.
In addition to the allegedly illegal payments, the districts challenge a number of other payments made by King County using sewer revenues. The districts allege that sewer revenues have been diverted to pay King County general government expenses as acknowledged by the State Auditor, who found that as a result of such improper allocations (almost $2 million for the period Jan. 1, 2004 through Aug. 31, 2005) “ratepayers do not receive the full intended benefit of those revenues. In addition future user fees for some funds will be higher than they should be.”
The county has continued its practice of allocating wastewater funds to general government expenses, the districts claim.
The districts also allege that the county’s funding of projects using $1.5 to $2 million of sewer revenues annually is illegal because the projects have no relation to sewage disposal and instead are simply “pet projects” of certain County Council members. Some of the projects aren’t within the area served by the county’s wastewater system, the districts contend.
Other expenditures challenged by the districts include the county’s purchase of the StockPot Soup property and facilities and payments to induce StockPot to keep jobs in the local region. The county determined early in the design of the Brightwater project that the StockPot Soup property wasn’t needed for the treatment facilities, but that changed when StockPot complained that operating next to a wastewater treatment plant didn’t fit its image and threatened to move out of the county, taking 250 jobs with it, according to the districts.
The county spent more than $23 million for StockPot facilities and relocation expenses and approximately $8 million for the property purchase – an expense which should have been paid, if at all, from the county’s general government fund, according to the districts.
The districts want a court ruling that the disputed payments are illegal because they violate the sewer contracts, the county charter and other state and local laws. A spokesman said the districts also want King County to be prohibited from continuing to make the allegedly illegal payments, and that the county reimburse the wastewater fund and the districts and other sewer utilities for the payments.
The county’s Wastewater Treatment Division serves 17 cities, 17 sewer districts and more than 1.4 million residents in King, Snohomish and Pierce counties. Formerly called Metro, the agency has operated for more than 40 years.
