Report to: General Committee – Finance & Administrative Date of Meeting: 2008-11-03
SUBJECT: Proposed 2009 Water/Wastewater
Rate Increase
PREPARED BY: Andrea
Tang, Manager, Financial Planning
RECOMMENDATION:
That the
report dated November 3, 2008 entitled “Proposed 2009 Water/Wastewater Rate
Increase” be received;
AND
THAT staff be authorized to hold a public meeting on November 18, 2008 at 6:45p.m. on the proposed 2009
Water/Wastewater rate increase;
AND
THAT the 2009 Water/Wastewater rate increase be equivalent to the Region of
York’s (“Region”) increase currently estimated to be 12.66% resulting in an
increase in the Town of Markham’s (“Town”) Water/Wastewater rate of $0.2132 per
cubic metre (m3);
AND
THAT in addition to the Region’s increase, the 2009 Water/Wastewater rate
increase will include the second year of the approved 10 year phase-in of the Water/Wastewater
Infrastructure Surcharge of $0.0621/m3.
The purpose of the report is to obtain approval:
1.
to hold a public meeting on November 18, 2008 at 6:45 p.m. to discuss the proposed
Water/Wastewater rate increase
2.
to increase the Town of Markham’s
Water/Wastewater rate by $0.2753/m3 which includes an estimated
increase of $0.2132/m3 in matching to the Region’s increase of 12.66%
and the second year phase-in of the Water/Wastewater Infrastructure Surcharge
of $0.0621/m3.
A resolution
was passed by Council in June 2002 stating “And that all further rate increases
by Region of York be automatically met by the Town of Markham with a percentage equal to that of
the Region”. Historically, the Town
receives projected water rate increases from the Region prior to the end of the
year and, at a minimum, matches the Region’s Water/Wastewater rate increases
following a public meeting and Council authorization towards the end of the
year.
The Municipal
Act (O.Reg. 244/02) requires a public meeting be held before passing a by-law
imposing a Water/Wastewater fee or charge.
As in previous years, following approval of this report, staff will
advertise notice of the public meeting via the “Town Page” in local newspaper
and the Town’s webpage.
OPTIONS/DISCUSSIONS:
Region’s Increase
Based on
discussions with the Region, the estimated Water/Wastewater increase is
currently 12.66% effective April
1, 2009. Regional Staff
advised that a report will be tabled to Transportation & Works Committee on
November 5, 2008. If approved, the report will be brought
forward to Regional Council for approval.
The
recommendation is for the Town to match the Region’s estimated 12.66% increase
resulting in an increase to the Town’s Water/Wastewater rate of $0.2132m3 to
$1.8976m3 effective January 1, 2009.
Water/Wastewater Infrastructure Surcharge
In addition to the Region’s estimated
increase, Council approved a Water/Wastewater infrastructure surcharge on November 27, 2007 to
address the ongoing replacement & rehabilitation requirements for Waterworks
infrastructure.
The approved infrastructure surcharge of
$0.4137/ m3 is to be phased-in over 10 years with an increase of
$0.0827/m3 (20% of the total increase) in 2008, and an increase of
$0.0621/m3 (15% of total increase) in 2009. The remaining 65% increase
of $0.2689/m3 will be spread evenly over the following 8 years,
which is equivalent to an increase of $0.0336/m3 per year from 2010
to 2017 inclusive.
FINANCIAL
CONSIDERATIONS:
The estimated 12.66% increase in Region
and Town’s Water/Wastewater rates and the second year phase-in of the Infrastructure
Surcharge of $0.0621/m3 are outlined below:
TABLE A – Water/Wastewater
Rate
Impact
to Residents & ICI Customers
An average household has water
consumption of 342m3
per year. With a total increase of $0.2753 increase/m3
(Region’s estimated increase of $0.2132 and Town’s increase of $0.0621)
in 2009, there will be an increase of $94.15 to an
average household bill. The impact on
the top 10 ICI customers, including a health care provider, manufacturers, and
hospitality providers, will range from $33K to $74K per year (Region’s
estimated increase $26K to $57K and the Town’s increase $7K to $17K).