PUD and TOC vote to approve preliminary agreements

For years, there have been discussions, suggestions, and conversations regarding a potential consolidation of the Town of Cathlamet’s (TOC) water system with the Wahkiakum PUD (Public Utilities District) that have been shrouded in confusion, complicated, hard-to-interpret financial reports, and rampant outpourings of misinformation. The Washington Department of Health approached the Wahkiakum PUD in August 2023 to consider consolidating the TOC and PUD water systems. A consolidation study was conducted through a DOH Consolidation Grant Fund. Gray & Osborne completed the study in May 2024, identifying system deficiencies in the Town’s current water system and offering recommendations. The ambiguity of both the Town's and PUD’s opinions and perspectives on the consolidation has left many customers apprehensive about consolidating, or at least unsure of how they feel about it.

In recent months, however, the Town Council and the PUD have made strides to address their respective rate payers' anxieties regarding the consolidation. In his opening statement during a workshop on Feb. 18, 2025, Wahkiakum PUD Commissioner Gene Healy said, “It’s crucial to emphasize that while evaluating this proposal, the interests of the customers of both entities are paramount.” A committee has been formed that contains members from each party: Healy from the PUD and Councilmember Laurel Waller from TOC. This committee engages in having detailed discussions, coming to agreements, and reporting back to their respective board/council members.

Both sides agreed that the Consolidation Study has enough merit to proceed, reaching this conclusion at a joint meeting on Feb. 26. Councilmember Waller is in favor of the consolidation and stated during the joint meeting, “It appears that the consolidation of these utilities is feasible and likely can provide benefits for both the utilities and customers.” During the PUD Commissioner’s meeting on Tuesday May 6, Healy listed the advantages of consolidating: “The PUD has a full-time manager at the helm, the Town does not,” he said. “The current manager holds a Bachelor of Science and Engineering, an MBA, and nearly 30 years of experience in the utility world… Many of the Town’s sewage systems are outside of town limits, and under the current arrangement, they do not elect policymakers for their utilities. Under the PUD model, they would.” There has been much speculation regarding this consolidation's effect on Puget Island customers and current rate payers. Still, the PUD Commissioners do not foresee any rate increases for PUD or Town customers.

Some town parties have expressed fear regarding the revenue loss of the Town’s water system and how this would affect funding for certain public utilities, such as the Library, pool, etc. “The PUD acquiring water and/or sewer utilities will not affect the pool or library–the Town’s programs should be self-supporting,” Healy stated in a write-up he presented at the Feb. 18 PUD Workshop. With that said, the Town will no doubt need to establish alternate income streams should the PUD take over the water/sewage systems.

During its meeting on Monday, May 5, Cathlamet Town Council approved a resolution to accept a preliminary asset transfer agreement and a preliminary operating agreement in principle. The PUD Commissioners also approved these agreements during their May 6 meeting. Approving these agreements opens the door for the details to be “hammered out” with PUD General Manager Dan Kay and TOC counterparts. The two groups appear to have begun accelerating the process of working out the details of consolidating, as it seems most are in agreement that it needs to happen. Not all are in full agreement, though, as PUD Commissioners are still apprehensive about the sheer amount of debt that is tied to the TOC’s water system, “I have a problem with all that debt,” said Commissioner Dennis Reid. “I don’t know if I, in good conscience, will be able to vote yes or not [on consolidating]... but I want it to be known that if the other two commissioners vote yes, I will 100% support it like we [commissioners] always support each other.”

The agreements approved by the commissioners and council members still have many details that need to be resolved. Commissioner Gene Healy requested a timeline on the finalization of the consolidation from Kay by the next meeting on Tuesday, May 20.