The new Water and Wastewater plant may have received accolades from the Ontario Public Works Association, but many users take a dimmer view of the project. Since the new plant came on line in 2016, the township has fielded complaints from Millbrook residents facing sticker shock when they open their water bills, and are particularly irked by the fixed portion of their bills.
User rates were established through a 2015 study which lead to the decision that base and variable charges for water would increase by 20% per year from 2016 to 2020, after which point there charges would remain unchanged, while the wastewater rate increases were pegged at 15% for the first five years and flat thereafter. Users are having difficulty with the rates this year, and can’t imagine that more increases are required of them in the near term.
Rather than wait to re-examine the rates at the end of 2020, Council sought input on possible alternative rate changes they could consider to alleviate the pressure on Millbrook users without jeopardizing the viability of the project, which due to provincial legislation must be financed solely by its users.
The $21 million water and wastewater project included a major wastewater plant expansion to increase the service capacity by 1000 more residential units, a new water tower, a pumping station expansion, and the extension of sewer and water main services along County Rd. 10 from Brookside to the township offices in anticipation of the new development. Two-thirds of the bill was funded through a federal and provincial government cost-sharing program designed to address national, regional and local infrastructure priorities. The township was originally approved for this funding for the Fraserville development, but when that project died the municipality was able to redirect the grants to the Millbrook project because it was designed to accommodate growth instead of simply replacing existing infrastructure.
At the time, recurring breakdowns at the former water treatment facilities had become increasingly difficult to address as the age of the equipment made securing replacement parts difficult and expensive. Flow-through at the plant was reaching its capacity on a regular basis. The existing treatment process did not meet current environmental standards due to the levels of phosphorous contained in the effluent, but was allowed to continue, but any expansion of the plant would have to meet the new criteria. An update in the system was required, which would have represented a stop-gap costing millions, and without growth, the grants would be lost and the entire upgrade expense would have to be borne by the 600 existing municipal users.
Council decided to proceed with the larger project, which would allow the municipality to grow. The larger project would also eventually spread the both capital and operational costs over more users. Of the development charges directed to the township from each new residence in the Towerhill development, $8415 is directed to water and wastewater services. As these units become occupied, these residents will also start contributing to both the capital and the operational expense of this service.
There’s no getting around the fact that water services are expensive. In his report to Council, Gary Scandlan of Watson and Associates explained that the new water infrastructure represents almost $35,000 per home: a portion for getting the water into the home and even more for treating it as it is flushed away. That number is close to the amount a new rural residence would incur for a new well and septic system. Part of the problem may be how the bills are presented, as the variable component label on water bills is a bit of a misdirection. The only truly variable expenses are hydro and chemicals, but the amount included seems to be a mechanism to push more of the capital expense to higher volume users to alleviate the costs for smaller households, which makes sense.
Because occupancy in the new development has been slower than anticipated, some of the planned expenditures can be delayed, which Scandlan suggested provides a window of opportunity to put the brakes on the rate increases at least for a while. He presented three options for consideration: maintaining the original rate increases; slowing the increases for the next 2 years to 2% or freezing them for the next two years and revisiting them at the next mandatory rate review. Council opted for plan B. It’s a temporary reprieve, mind you. New infrastructure legislation mandating asset replacement reserve minimums comes into force in the next few years and will force the hand of lower-tiers of governments to take a close look at the state of their capital assets and develop a plan to keep them in a minimum state of repair.
It’s easy to find someone in another municipality with lower water rates, but stay tuned. When it comes their turn to update their crumbling infrastructure, they might not be so lucky to secure grants to help pay those bills, and they, too, will have to meet the new stringent requirements of Ontario’s Clean Water Act. And despite feelings to the contrary, according to Scandlan when it comes to water and wastewater services, the new users will actually be subsidizing existing users, just don’t tell them that. KG
