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”.
On November 25, 2008, Council
amended the 2002 resolution, and passed a resolution to increase the Town’s
2009 Water/Wastewater rate to reflect the matching of the Region’s monetary
increase. As a result, the
infrastructure surcharge included in the 2009 Water/Wastewater rate was
increased by $0.0633/m3 in order for the reserve to be in the
same financial position as it would have been under the previous policy of
matching to the Region’s percentage increase.
Staff was also
requested to investigate the viability of implementing the 2010 rate increase
effective April 1, 2010,
to align with the timing of the Region of York’s rate changes.
At the June 15, 2009 General
Committee, Staff presented the 2009 Water/Wastewater Reserve Study Update with
a proposed 2010 Water/Wastewater rate of $2.2129/m3 resulting from the followings:
·
matching
to the Region’s monetary increase;
·
third
year of the approved 10 year phase-in of the Water/Wastewater Infrastructure
Surcharge;
·
an
additional infrastructure surcharge to account for the Town’s rate increase
effective April 1, 2010
and changes in assumptions.
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.
A public meeting
was held on October 27,
2009 proposing the increase to the Town of Markham’s Water/Wastewater
rate by $0.2087/m3 from $2.0042/m3 to $2.2129/m3.
There was no objection raised at the public meeting.
OPTIONS/DISCUSSIONS:
Region’s Increase
The York
Region report dated December
18, 2008 identified a 10% increase in the 2010 water and wastewater
rates.
Therefore, as
per the Town’s policy, the Town will match the Region’s monetary increase of
$0.1229/m3 based on Region’s forecasted increase of 10%.
Water/Wastewater Infrastructure Surcharge
In addition to the Region’s estimated
increase, Council approved a Water/Wastewater infrastructure surcharge to
address the ongoing replacement & rehabilitation requirements for
Waterworks infrastructure.
The 2010 rate will include the third year
of the approved 10 year phase-in of the Water/Wastewater Infrastructure
Surcharge of $0.0457/m3.
Proposed Water/Wastewater Additional Surcharge
The 2009
Water/Wastewater Reserve Study Update included changes in policy and
assumptions which resulted in the need for an additional surcharge of $0.0401/m3
in order to have sufficient funding in the Waterworks Reserve for the
next 25 years.
The 2009 Water/Wastewater
Reserve Study Update included the following changes in policy and assumptions:
- policy change to increase the
Town’s rate effective April 1 rather than January 1 to coincide with the
Region’s increase
- un-metered usage assumption
increased from 7.5% to 10%
- Region’s Water/Wastewater rate
increase adjusted from
- 2008 Reserve Study – 3% per year
to
- 2009 Reserve Study
- 10% in 2010 & 2011
- 8% in 2012 $ 2013
- 4% starting in 2014 & onwards
- Interest rate adjusted from
- 2008 Reserve Study – 4%
- 2009 Reserve Study – 1.5% in
2010, 2.5% in 2011, 3.5% in 2012 and 4% starting in 2013 & onwards
FINANCIAL
CONSIDERATIONS:
The 2010 proposed Water/Wastewater rate
will be increased by $0.2087/m3 from $2.0042/m3 to
$2.2129/m3. The breakdown of the
proposed 2010 rate is 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 $0.2087/m3 (Region’s
estimated increase of $0.1229 and Town’s increase of $0.0858) in 2010, there will be an increase of approximately $71.38 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 $11K to $32K per year (Region’s estimated increase $6K
to $19K and the Town’s increase $5K to $13K).
