Increases approved for utilities to cover laundry list of capital projects
With discussion already carefully vetted in public forum the final stamp of approval was levied on the increase to city utilities.
A report from the City of Nelson’s Finance department was approved that suggested a two per cent increase to the water rates charged city residents — along with a similar two per cent rise in sewer fees — to help pay for the costs related to several major projects on the horizon in 2023.
Although the first three readings on the increases were passed by city council in its regular business meeting Jan. 17 without debate, two previous budget meetings had revealed the depth and breadth of the factors involved in calling for the increase, said Coun. Rik Logtenberg.
“For the public to think that we are passing this without discussion we did quite an extensive (discussion) on this,” he said, citing the two public budget meetings that were also streamed online.
City chief financial officer, Chris Jury, said the utility budget for 2023 continues to cover a lot of ground with capital projects, and the bill needs to be paid for that laundry list.
“What we have had in our plan for quite a few years is sort of that two per cent increase for water and one-and-a-half wastewater,” he said in the special budget meeting of council on Nov. 14.
The 2023 capital projects included the Sewer Treatment Plant (STP) maintenance ($225,000), RBC lifecycle maintenance ($550,000), lift stations ($200,000) and a Liquid Waste Management Plan ($165,000).
On the water delivery end, 2023 capital projects include completion of phase three of the secondary source pump station ($200,000), phase four of the finished water storage ($1.35 million), the reservoir dam inspection ($67,000) and watermain replacements ($600,000).
Jury said the extra half of a per cent difference for wastewater comes out as $3 million when the city gets to the end of that wastewater treatment facility upgrade (or replacement) project. It could be $3 million less in borrowing, $3 million more in reserves, or it could just be a contingency piece that adds up over time, he added.
The water and wastewater utilities are based on a fee-for-service model, Jury explained, meaning the rates charged for water and sewer must be sufficient to cover operating and capital costs, as well as build adequate reserves to fund future capital expenditures.
Once the amended bylaw is adopted by council, invoices with the new rates will be sent out to residents in early February 2023.
The 2022 utility rate (combined) for a single family dwelling in Nelson was $1,089, while the proposed increase for 2023 would bump the figure by $22 per year to $1,111.
On the commercial end, the utility increase effect on a commercial restaurant would creep from $3,202 to $3,266 — a proposed rise of $64.
However, there will be no increase to Resource Recovery rates for 2023. There could be consideration of rate increases in future years if the FoodCycler program is “successful and is expanded city-wide.”
As well, the city will continue with the 75 per cent rate discount for conforming suites that are rented long term, in addition to continuing with the ICI water loss mitigation project.