Taxpayers will fork out an extra seven per cent on their water and sewer utility bills next year, after city council narrowly approved hiking the utility costs.
During a special budget meeting on Dec. 5, council voted 4-3 to increase the waterworks utility rate by four per cent effective Feb. 1, 2023; voted 4-3 to increase the sanitary sewer utility rate by three per cent effective Feb. 1, 2023; and voted unanimously to increase the interest rate for payments made by annual instalments to seven per cent from four per cent.
Councillors Kim Robinson, Crystal Froese and Dawn Luhning were opposed to the first two motions.
The waterworks increase would add an extra $2.86 per month or $34.32 per year to bills, while the sanitary sewer increase would add an extra $1.72 per month or $20.64 per year to bills.
That would be an extra $4.58 per month or $54.96 per year for both utilities.
Taxpayers will pay a new annual infrastructure levy next year of $100 to support parks and recreation upgrades, which means most annual utility bills will increase by $154.96. Since homeowners continue to pay the annual $100 infrastructure levy for the cast iron replacement program, those bills could increase to $254.96.
Future water needs
Both utilities face over $86 million in capital renewal costs during the next five years, including over $20 million to replace the Crescent View lift station and roughly $29 million to continue replacing cast iron pipes, explained finance director Brian Acker.
The utility must also pay over $30 million in debt from past infrastructure renewal.
One reason the water hike is one-per-cent higher than sanitary sewer is because of the higher cost of water from the Buffalo Pound Water Treatment Plant due to its plant renewal project, he pointed out.
Meanwhile, increasing interest rates for the instalment payment rate program is because the current rate is four per cent, lower than current national interest rates, Acker said. Since the current prime lending rate is 5.95 per cent — and is expected to increase — city administration believes hiking the city’s instalment rate to seven per cent is appropriate.
Council discussion
“It would be nice one year if we didn’t need water and sewer rate increases, but I understand why we do,” said Coun. Heather Eby. “I remember in the past doing nine per cent (increases), so four per cent feels a little easier but not easier at all.”
While these increases will support ongoing and future underground work, many people don’t understand that they are not just paying for water to wash their dishes or make iced tea, she added. Instead, they are also paying for the accompanying infrastructure work, which is expensive.
City administration hopes to reach a point where it doesn’t have to increase utility rates yearly, said Acker. While there always seems to be a major project upcoming, city hall hopes to eventually freeze rates for a few years.
“We’re living in really challenging times too, just for average taxpayers. That is one of my concerns as it was last year, and it’s even tighter this year,” said Coun. Crystal Froese.
Many residents are struggling to pay the bills, which won’t be helped with council adding an extra $154.96, she added. While she understood how important improving infrastructure was — cast iron is the community’s biggest renewal project ever— she wanted council to remember that not everyone could afford the increases.
“It is a tough time for everyone, but the city’s not immune to that. We, unfortunately, have to pay the same increase as everyone else has to pay,” said Coun. Jamey Logan. “Our water supply is going up, (the) power supply is going up (and) energy (is increasing). We are not sitting here looking to harm homeowners.”
It’s important to fund these projects, otherwise, they face future financial shortfalls, he added.
The next special budget meeting is Wednesday, Dec. 7.
The next regular council meeting is Monday, Dec. 12.
