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Sewer, water rates to go up

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While town council has not yet decided on sewer and water rates for 2012, some customers will end up paying more.

Coun. Rick Wiedenhoeft said during a budget meeting Monday that council wants to continue its plan to build sewer and water reserves to help pay for infrastructure replacement.

In December, council accepted financial plans for the sewer and water systems as prepared by BMA Management Consultants, which indicated both rates be increased five percent each year over the next six.

“We’re doing it because we’ve got a huge capital deficit if we look at our infrastructure for water and sewer decay in the ground,” noted Coun. Wiedenhoeft.

“If we don’t put money away prudently and proactively, when the thing starts to crumble from a thousand leaks or a catastrophic failure, we’re faced with either a huge rate shock by increasing our rates all at once to pay for it or we’re looking at a huge debt,” he warned.

“That’s why we’re doing this—we’re trying to build up our reserve funds so we don’t create havoc in the future.”

Council will be looking at various scenarios to ensure there is an equitable sharing of costs.

These range from having no rate increases, but lowering the threshold at which industrial, commercial and institutional (ICI) customers have to start paying more for water used, to increasing rates for everyone as well as adjusting that threshold.

Whatever option they choose, Mayor Roy Avis said Monday that council has to make sure they spread out any increases.

He added it took more than 100 years to get where the town is with its aging infrastructure, and the town can’t expect ratepayers to make up for everything in a five- or 10-year period.

“I think we have to try and come up with a blend where we see everybody contribute a little bit in order to get up to where the BMA report was, about $220,000,” he said.

The mayor suggested a one percent increase for residential customers, reducing the ICI threshold from 216 cubic meters a year to 204 meters, and adding a three percent increase to the volumetric ICI rate.

Mayor Avis also felt residential and commercial customers are having to subsidize institutional customers, and would like to see institutional customers split into a separate customer class instead of being included with industrial and commercial customers (currently known collectively as ICI).

Two-thirds of the 280 ICI customers are paying more money than residential customers for water, but 59 of the 280 (many of whom are institutional) actually are paying less than the cost to produce water (it costs $3.03 to produce a cubic metre of water).

Institutional customers include government-run buildings such as the courthouse, jail, and hospital.

These scenarios will be discussed further by the Operations and Facilities executive committee today, and may come back before council as early as next Monday’s regular meeting.

Council is expected to have new sewer and water rates passed by the end of this month—in time for the next sewer and water bills to go out.

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