Brockton water and sewer rates will be going up six per cent per year for the next five years.
That translates to an increase of approximately $45 for an average Walkerton home and slightly less for residences in the Lake Rosalind and Chepstow areas which don’t have sewers.
Utilities Manager Colin Saunders told The WHT that the increases are needed to plan for expensive projects to replace aging equipment at the waste water plant.
The province is mandating councils to have a cost recovery plan in place covering the next five years with five year reviews. A consultant’s report to council showed three options – doing nothing; recovering some over time while planning on other sources of financing such as debentures and government grants; or saving with plans to pay for future projects on their own.
Saunders said the cost of saving with the intent of covering 100 per cent of the costs was too high.
“I was quite surprised at the cost recovery rates,” he said. “It would mean astronomical rate increases. No council would agree to that.”
While Saunders said he doesn’t like borrowing – “look at Greece and even the U.S., they’re making 30 to 40 per cent payments for the interest” – he said with the number of projects needed over the next five years it made sense for council to save some now, with plans to use the reserves as needed, government grants, and loans.
Saunders said he recommended council take the “middle of the road” approach.
As of last year there is $750,000 in the water reserves and $350,000 in the waste water reserve account.
The water budget for 2011 was $833,258. That will increase to $867,392 this year. The waste water budget for last year was $854,148 and that will increase to $910,254 in 2012.
Some of the equipment at the plant dates back to the 1970s, Saunders said, noting there was a big upgrade done in the 1980s. “There are some bigger ticket items that will have to be done over the next 10 years,” he added.
At last week’s council meeting Mayor David Inglis told council it was a necessary increase.
“The bottom line is we need to be putting dollars aside. This council said when we came into this term that we would start putting money into reserves,” Inglis said. “It’s good financial planning.”
Coun. Charlie Reidl pointed out that the increase wasn’t a tax. “This is not a tax increase. It is user fees only,” he said.