Residents who use municipal water and wastewater services in Guelph-Eramosa will soon see base rate hikes of about 138 per cent.
In 2016 the rate will increase to $10 from $4.20 this year.
The rate is scheduled to jump to $10.82 in 2020 based on the latest Watson and Associates Economists Ltd. water and wastewater rate study.
The overall annual water bill for both the Hamilton Drive and Rockwood water systems will increase more than 50% over the next five years.
Currently the township collects a base fee plus a usage fee for both water and wastewater.
Officials say the significant rate increases are a result of the township trying to gear up to make the water systems sustainable long term, based on an asset management plan.
“We know exactly what it is we need to do to theoretically sustain this water system going forward,” Mayor Chris White told the Advertiser in a phone interview.
“So what that means is (a) bump in the rates to start and then they’ll plateau out, but that allows us to maintain a safe, clean sustainable water system.”
White said the hike is also necessary to put Guelph-Eramosa back on the same level as other municipalities and to gain funds for reserves, which will finance long-term infrastructure needs.
“Looking at the water rates where they need to be in order to make this a sustainable system going forward, we need to invest more in the capital,” he said. “We need to get some more reserves.”
Finance director Linda Cheyne said a portion of the increased base rate will go directly to reserves.
Hamilton Drive
For the Hamilton Drive water system, the total volume rate will continue to increase. Next year the rate will rise about 8% moving to $2.56/m3 of usage from the current rate of $2.37/m3. In 2020 the hike will be about 44% compared to this year, reaching $3.42/m3.
For an average homeowner using 240m3 of water per year the total annual water bill will increase about 19% to $734 next year (from $619 this year). By 2020 the total will increase about 54% over 2015 to $952.
Over the next 10 years, it is forecasted that $458,458 will be used in capital expenditures for the Hamilton Drive water system.
Rockwood
For the Rockwood water system the total volume rate will also continue to increase.
Next year will see a 7% increase, from $1.87 to $1.99/ m3 for usage. In 2020 the volume rate will increase 35% reaching $2.52/m3.
For an average homeowner using 190m3 of water per year, the total annual water bill will increase 23% to $498 next year (from $406 in 2015). In 2020 the annual bill will reach $609, which is a 50% increase over the 2015 rate.
The 10-year capital budget forecast for the Rockwood water system is about $3.6 million. A new pumping station will require $1.2 million and $1.7 million will be needed for infrastructure replacement.
Wastewater rates for Rockwood users will also increase. The constant metered volume will increase 6% next year from $2.64 to $2.80/m3. In 2020 the rate will increase 29% over 2015, reaching $3.40/m3.
This means an average homeowner with 190m3 of wastewater can expect their total annual bill to increase 18% next year, reaching $652 (compared to $552 this year). Over the next five years the total bill will increase 41% to $776.
The capital budget forecast over the next 10 years for the Rockwood wastewater system is predicted to hit $6.7 million. About $4.9 million will be needed for the Alma Street pre-treatment, storage and sanitary sewer and $1.5 million will be needed for lifecycle replacement needs.
Gazer-Mooney
The Gazer-Mooney area of the township uses water services from the City of Guelph. The area is charged a flat rate water fee to maintain the system infrastructure. The fee will increase 7% next year from $235 to $252. In 2020 the fee will increase 40% over the 2015 rate to $330.
The water and wastewater capital budget forecast for the area for 2015 to 2025 is estimated to be $161,000, largely for infrastructure replacements.
Previous study
The township’s previous water and wastewater rate study was completed in 2011.
It included rate increases of 53% in Rockwood, 80% in the Hamilton Drive area, and a 40% increase to the Gazer-Mooney flat water and wastewater rate.
White said the changes four years ago was the first step in the township’s attempt to get ahead of all the new regulations and requirements.
“That was the first increase in a number of years in 2011,” he explained.
“We … tried to catch up in 2011, now we’re trying to catch up to this new legislation to deal with the hydro costs so that’s why we’re bumping them up again.”
Council passed a bylaw to approve the Watson and Associates Economists Ltd. recommendations at the July 13 council meeting.
The new rates will be in effect as of Jan. 1.
