Change in water priorities could restart development in North Bend

City council move could bring water to underdeveloped or delayed projects along East North Bend Way,

As several developments in eastern North Bend have been delayed or remain underdeveloped after being denied access to water by their utility provider, the North Bend City Council has approved an agreement this week aimed specifically at helping properties with city limits.

In a unanimous decision, the council agreed to prioritize properties within city limits for all future water service connections, even those that reside outside of its water service jurisdiction.

According to a city staff report, the change is intended to serve as a short-term solution for the city to ensure it can service all of city limits and its water service area as it looks for long-term solutions to its future water needs.

North Bend City limits is split almost in half between two water service district’s, who both supply water to about 2,000 customers inside and outside of city boundaries. The western portion of the North Bend is served by the city, while the eastern portion is served by Sallal Water Association, a board-run utility group of rate paying members.

Dating back to 2017, Sallal has struggled to provide enough water to support development projects within its service area – including a section that is inside North Bend’s city limits.

Sallal’s situation became more alarming for the city in June, when its board entered into an emergency moratorium on new water connection, which will last at least six months, and prevent any development from proceeding. That prompted the city to redirect its future water allotment.

“There are several large commercial projects along East North Bend Way that no longer have access to water,” City Public Works Director Mark Rigos said at the city council meeting last week. “This resolution is unfortunately being caused by Sallal’s moratorium.”

A lack of water and subsequent moratorium presents a problem for the city, which is expected to see much of its future growth within Sallal’s service area.

Under the Growth Management Act (GMA), a state law passed in the 1990s, urban cities, such as North Bend, are required to plan for and hit annual growth targets provided by the state.

The GMA also provides an urban growth boundary, an area of what is currently unincorporated land that the city is expected to annex in the future when it’s fully built out. Much of North Bend’s unannexed growth boundary is concentrated in Sallal’s service area.

While the city planned to use its remaining water rights to expand into those unincorporated areas, the plan approved last week shifts focus to serving those in city limits.

In an interview, North Bend Mayor Rob McFarland said the city has an obligation to provide water to those within the city and its water service, even if they are served by other water districts.

“With this resolution we are acknowledging that should those properties come to the city for service, because they’ve been turned down by Sallal, we will support them in that change,” he said.

Jae Hill, a principal planner with King County’s Permitting Department, told the Valley Record that county law allows North Bend to provide water to those in city limits, including in Sallal’s service area, without the need for a legal water district boundary change. He said county law allows adjacent water providers to service neighboring districts, if their original provider is unable.

“Since Sallal has stated they can not serve new developments within their service area, and the City of North Bend claims that they can serve [that area], any applicant can request a Certificate of Water Availability from the City and obtain available water connections in compliance with county code and state statute,” Hill wrote in an email.

The only condition, Hill said, is that the availability of water within the city is still subject to the conditions of its water rights and mitigation requirements. North Bend will also be required to update their water systems plan to reflect changes — that would generally come at their next scheduled planning update, but could require an immediate amendment for large developments.

Due to plans to eventually grow into unincorporated areas, McFarland said the city has enough water and mitigation water to service its entire current city limits, although, he said, if nothing changes there would come a time when the city “would not be able to serve more water.” In prioritizing its water for those inside city limits, expansion into the city’s growth boundary could also be delayed.

“If we preferentially chose someone in city limits, it would reduce the amount [of water] available in the Urban Growth Area,” McFarland said. “[That] may mean it’ll be a longer delay to serve the UGA.”

Sallal first reported problems in servicing its water district in 2017, when the city approved a development project for a 218-unit apartment complex at the Dahlgren Property along East North Bend Way.

That project, which is currently under construction, was delayed several times before the property was removed for Sallal’s jurisdiction and awarded to the city upon approval of its 2020 Water Systems Plan – marking the first time Sallal had lost property to the city.

Since then Sallal has halted two other developments, according to a city staff report, a Washington National Guard building in 2019 and the proposed Alpine Crossing multi-use project in 2022.

The city said it has offered repeatedly, to no avail, to execute a Water Supply Agreement with Sallal, providing additional water to serve its customer base both in and outside of city limits. A message left for Sallal Water Association seeking comment for this story was not returned.

The city and Sallal have a long and complex relationship that has intertwined over the last 15 years as both have had their own struggles related to water rights.

In 2009, North Bend exited a decade-long self-imposed development moratorium after its Centennial Well water right came online, but that water right has a caveat.

With the Centennial Well being heavily connected to water levels in the Snoqualmie River, the city is required by its water right to have a back-up source of mitigation water it can pump back into the river during periods of drought.

Fulfilling that need, North Bend contracts with Seattle Public Utilities for Hobo Springs, its primary source of mitigation water that it recently expanded. However, the city is also required to have a back-up mitigation source for Hobo Springs, which, to date, they have yet to secure.

McFarland said in 2009 the city had a plan to receive mitigation water for Sallal, before Sallal backed out at the last minute. Since then, the city has been negotiating with Sallal annually, but have been unable to strike a deal.

McFarland said Sallal would provide the “best solution” for mitigation water, but emphasized it was not the only option.

The city has enough mitigation water currently and is not reliant on Sallal, he said, but will need additional mitigation water in the next 20-30 years to service its entire growth boundary.

This story was updated from how it appeared in print to include additional information.