After considering a multitude of options to help raise money for the Town of Drumheller’s utilities, Council passed the first reading of Bylaw 15.12, the 2013 utility rates.
Councillor Jay Garbutt made a motion to increase the price of the water rates by three per cent, with no increase to waste water rates, but add a $1 surcharge to each utility bill.
The surcharge, tentatively dubbed the “Infrastructure Investment Surcharge”, will go directly into reserves for future capital projects.
The proposed increase would result in a fixed rate for water of $10.80 and a variable rate of $1.40 per cubic metre, up from $10.50 and $1.36, respectively. The waste water rates would remain at $11.50 fixed and $1.85 per cubic metre, calculated at 80 per cent of water consumption.
Therefore, a household using 19 cubic metres of water in a month would, in 2012, have a bill of $77.96 and, in 2013, $79.03 plus a $1 surcharge, resulting in a $80.03 bill.
“To be responsible and to take measure towards the long term sustainability of this precious resource, it’s not acceptable that we put ourselves in a situation where a utility that is worth $50 million has less than $500,000 in reserve,” said Garbutt.
Council was also presented with the option of increasing the water rates by five per cent, which would have resulted in a fixed rate of $11 and a variable rate of $1.42.
The three per cent rate increase would give the Town complete cost recovery for the utility and $470,000 surplus for reserves. However, CAO Ray Romanetz explained most of those reserves, roughly $300,000, would be used for smaller projects throughout the year. Councillors Garbutt and Andrew Berdahl felt that would leave too little to build up any meaningful reserve for larger, or sudden projects.
The surcharge will give the Town roughly $40,000 extra for reserves.
“Part of total cost recovery includes not just meeting our expenses, but a return on our investment, which we can set aside for future capital investment,” said Garbutt. “The province continues to demand higher quality for the water we provide, without increasing their funding. So, we’re being pushed towards incredible self reliance. Having a reasonable supply of funds on hand to deal with capital expenses to expand and enhance our water system is becoming muncipalities’ responsibility."
Councillor Sharel Shoff asked if the surcharge would be the same, regardless if the utility was for a business or apartment. The intent is to make the surcharge the same for each utility user.
The first reading of the bylaw passed with Mayor Terry Yemen opposed.
“It was just the first reading, so it’s not a done deal,” said Mayor Yemen. “I don’t see that it’s necessary. It’s important to have reserves, but when we talk about trying to build a reserve of $5 million, I don’t see how we can get there with this.”
Council will conduct the remaining two readings at their next meeting on January 7, 2013.
Rural Alberta communities will be the stage for multi-day international cycling race and festival to be held from September 3 to 8, 2013. One of the communities to be featured will be Drumheller.
