City council was expected to increase water and sewer rates at last night’s council meeting in order to pay for badly-needed improvements to the aging utility systems.
Council was considering raising water fees by 10 per cent in each of the next five years and sewer fees by six per cent over the same period. That’s equal to $22 per month or $264 per year for water for flat user fees and $21 per month or $252 per year for sewer, up from the current rate of $20 per month for water and $20 each month for sewer.
Ron Neufeld, the city’s general manager of operations, said without the increase, the city would need to take on $15 million in debt over the next five years to replace the old infrastructure. The city would also need $4.9 million in government grants, which are not yet secured, $13 million in third party contributions, $28.6 million from reserves and increases to user fees.
“Upon review, it is apparent that the city’s water and sewer utilities are not financially stable or sustainable,” Neufeld said. “Currently, fees charged for water and sewer services only cover operating expenses, and approximately one kilometre of system renewal in both water and sewer. And, in both cases, we do not have enough funding to renew our aging system as fast as it needs replacing.”
Council’s 2013-2017 financial plan includes increased user fees to generate revenue needed to finance upgrades to the city’s water and sewer systems.
Neufeld said the increases will not only fulfil the financial plan, but will address the infrastructure deficit of the city’s aging infrastructure.
“These changes will enable the completion of the operational and capital work plans for the next five years and will enable the city to begin to consider an increased pace of infrastructure renewal beginning in 2015.”
During financial planning, Coun. Claire Moglove stressed the importance of looking after the city’s infrastructure.
“Water and sewer are the number one and two services,” Moglove said. “You turn on the tap, you get water. You flush the toilet, things go away. This is our staff saying to us in order to have a viable water and sewer system, this is what we need to do. This has to do with growth on the south end of town and over capacity and water pressure.”
Laura Ciarniello, the city’s general manager of corporate services, said funding is vital to keeping those services running.
“The proposal to increase user fees at a flat rate over the next five years will help provide a stable and reliable funding stream to cover costs associated with increased water and sewer system renewal beginning in 2015,” Ciarniello said. “Water and sewer are funded through user fees rather than property taxation, and council has directed that we should move toward funding these services as a user-pay system that fully recovers the costs related to providing these services. Staff will prepare the annual tax notices, which include the utility user fees for 2013, based on council’s decision.”
Council was expected to consider the user fee increase at Tuesday night’s council meeting after the Mirror went to press.