KAGAWONG—Billings township agrees that charging water users on the Old Mill Waterline, a cost recovery of $22,467.55 per unit (for the 20 units involved), would be unfair to those water users. Consequently, council is looking at one of two options. Option 1A would see the costs of the project reduced to $10,399.87 per water user by removing the cost of the project not directly related to the waterline, (curbs, road paving, line painting, barriers etc.). An additional option to be considered would see the cost shortfalls (a total of $207,997.37) for the renovation project shared among all water users in the township.
“We did not have the exact numbers until tonight’s meeting,” said Billings Mayor Bryan Barker at a public meeting last week that considered at the Old Mill Road waterline cost recovery. “I agree that one option (that would see 20 water users having to pay a cost of $22,467.55) is a hardship. And there are people that have two properties within this. Ethically, I can’t support this option.”
“However, in option 1a, where all expenses are removed that are not directly affecting this water line, this is fair compromise (that would see a per property cost of $10,339.87),” said Mayor Barker. “I’m certainly not in favour of option one ($22,467.55 per unit), but I also don’t believe it would be fair to have all water users across the township paying the total costs.”
The meeting was told that the actual costs of the project were approximately $1.7 million of which $1.2 million was funded.
Councillor Jim Cahill said in his opinion option 1A would not be acceptable either. “We need to consider another option that would see the shortfall costs being shared between all water users (approximately 174) in the township. This would mean a cost of $1,195 for each unit on the Billings water system.”
Mayor Barker provided background on the issue at the public meeting, attended by about 17 residents. In 2022, the township of Billings approved the removal and replacement of the Old Mill watermain within the right of-way of Old Mill Road for approximately 850 metres. The watermain is part of the Kagawong distribution system and the project benefits approximately 20 properties. The project was approved under the ICIP Green Stream funding which covered 73.33 percent of the project costs, with the remaining 26.67 percent portion being municipal and eligible for capital cost recovery. The total project cost was approximately $1.7 million, and after government funding, there is a cost recovery shortfall of $449,351.04
Mayor Barker pointed out all properties within the township do not have municipal water supply. The properties that have municipal water are responsible for the costs of operating the system. The associated expenses are not spread over the entire tax base.
There are options available for municipalities to recover capital costs associated with capital water upgrades benefitting property owners. This can be done on a capital cost recovery method or by a major facilities charge, should the municipality have a policy in place.
The capital cost recovery method has been used by the township in the past the past to finance the Kagawong water system, with three examples provided with those water users benefiting from these projects sharing in the costs.
“For the Old Mill Road water main project, the capital costs are for the removal and replacement of the waterline. A benefitting project is a property adjacent to the Old Mill Watermain replacement project which currently derives or may derive a benefit from its construction (affecting 20 properties,” said Mayor Barker.
In consultation with the municipal solicitor, staff are recommending the passage of a capital cost recovery by-law under the fees and charges provision of section 391 of the municipal act to recover the municipal portion of the waterline project. Under section 391 of the municipal act, municipalities can pass a by-law to impose a fee for capital costs related to sewage or water services on a class of person who will receive a benefit. The municipality can impose a flat fee and equal fee on benefitting properties.
One of the persons who is on the Old Mill Road waterline, Lisa Lanktree, stated, “we didn’t have time to request to be a delegation at tonight’s meeting” to voice concerns with the proposals.
“Why didn’t the township hold a public meeting prior to this to let the water users know what is being considered and how much we are being told we have to pay?” asked another resident.
Councillor Cahill said in looking at section 391 of the municipal act, the costs involved do not have to be restricted to only those water users that are benefiting. The cost shortfall can be allocated to all water users.
“Water pays for water,” stated Councillor Cahill. “We can allocate the cost to all water users.” He said that, for those being added on to a water line, that would be different in that only those benefiting would pay.
Councillor Vince Grogan said when the presentation of the options was first put forward, all those water users that benefit from the project and paying the costs should have been present.
“We have been kept in the dark on all of this, then we received a letter saying what we were going to owe. I was shocked,” said one resident.
It was pointed out by Mayor Barker that no decisions were going to be made by council (at last week’s meeting). And any questions members of the public can be forwarded to township staff.
“We will have a special meeting for members of the public to make delegations,” said Mayor Barker.
“So basically, the project is done, and now we are looking to have to pay between $10,000- $20,000. I have four kids. I can’t afford these costs. And I have been kept in the dark on all of this,” said Ms. Lanktree. “None of us here can pay $200 a month. People could lose their homes.”
“Members of the public can come forward with multiple delegations and questions,” said Mayor Barker. “We might need to have multiple meetings until a final decision is reached.”
“I believe the shortfall costs should be shared by all water users,” said councillor Cahill. “The only exception should be new water users being added to the water lines.”
Councillor Dave Hillyard noted any member of the public can access the same documents that council has received. “I want to remind everyone that any member of the public has access to these documents. They are not a secret and are included in the agenda packages any time the water line project was included to be discussed at a council meeting.” He said bulk water users didn’t get, as some might say, proper notice and they found out within less than 24 hours that the fire hall was condemned by the structural engineer and the site would need to be secure and then torn down and the bulk water users would not have access to any bulk water.”
“Many bulk water users didn’t have filtration systems,” and had to have them installed said Councillor Hillyard. “The repair and replacement of this (Old Mill Road) water line wasn’t a surprise to the users on the water system. They did know that the project was moving forward and was only funded by a portion of the grant.” The current users of the system have the ability of water at any by opening their taps and they pay approximately $125 per month. Bulk water users pay $350 a year and have to go and get their water, as well as look after the cost of pumps and uv lights and water filters which is around $1000 a year, he said. “So, in comparison those that are on the water system have a really fair deal.”
Councillor Hillyard said ”All users on the water system pay for the water system equally and any time a repair or replacement is needed the users on the special water line are responsible to pay for the cost. Previous councils have also made this decision when work was needed to the water system. The capital cost recovery method has been used by the township in the past for financing the water system, with all benefiting water users paying an equal portion of the cost.”
Councillor Michael Hunt said he understands and sympathizes with the plight of the water users. However, he said he agrees that the expenses in the project that benefit everyone in the township should be shared among them, while the costs benefitting water users directly should be shared by them.
Council supported excluding some expenses from the municipal cost recovery as they are considered a benefit to all ratepayers as opposed to solely the water users in the amount of $241,353.67 bringing the adjusted municipal cost recovery to $207,997. Council will be considering option 1A and directed staff to schedule a special council meeting to bring forward a report with an allocated cost comparison to include benefiting property owners across the entire water system including financial options. The special meeting will take place December 12.
