by Lucie Roy
First reading was passed at the Nov. 28 Regular Meeting of Council for an increase in rates for water, sewer and waste, effective January 2018.
Water, sanitary and garbage would see an increase in utilities of just over 1.8% for 2018.
Second and third readings for all three bylaws are to be brought to Council Dec. 12
Waste Management Bylaw 18/2017
Presenter Shawna Jason, Director, Corporate and Financial Services said that Administration is proposing an increase in waste management fees of 15 cents per month per household for an increase of $1.80 per year, just under 2 percent from last year.
Sewer Rates Bylaw 17/2017
Jason said the anticipated average residential household could see an increase in sanitary rates of $1.19 per month or $14.24 per year for an overall increase in utilities over last year by about 1.8 per cent.
Jason said the Town uses a full cost recovery model and a few changes were made to the sanitary rate model this year.
As with the water bylaw, they are achieving a slightly higher than required surplus in order to achieve the rate they calculated.
They have also received a draft Alberta Capital Region Wastewater Commission rate update and they have indicated they will have a price increase of just over 4.7 percent for 2018.
Jason said they have also looked at their sanitation operating budget and completed an update on that into their model and have looked at their reserves balance.
“We are starting the reserve in 2016 at just over 3.2 million. We anticipate based on our draft model long-term capital plan expenditure just over 5 million with excess funds from Sanitary Sewer Utilities of over 14 million coming in for an anticipated reserve balance at the end of 2038 just over 12 million dollars.”
Water Rates Bylaw 16/2017
Jason said Administration is proposing water rates go up and the average residential customer would see an increase in their monthly utility bills of 82 cents per month or $9.79 per year.
In her quick background summary, Jason said Morinville has adopted a full cost recovery rate model and as part of adapting and upgrading a cost recovery model each and every year, a number of factors are reviewed and carefully updated. This includes the current book value of water tangible capital assets.
It is through the review of the cost recovery model that we receive some interesting discoveries.
“We are seeing a reduction in the average annual residential consumption of approximately 7 percent per year over that of last year despite we are seeing growth of over 2 percent. So it was an interesting observation,” Jason said. “It tells us that water consumption measures such as the rebate programs that we have been promoting seem to be working. So that was good information. And also that any leaks within our system in Morinville use are quite minimal.”
As a result of the cost recovery model update the average rate of return for the water utilities calculated is 3.9% and sanitary and utilities calculated by 4 percent. In order to meet those levels of return the water utility requires a surplus of just over one million dollars and sanitary sewer utilities requires a surplus of about $675,000, so combined value of almost 1.7 million as a function.
Based on the cost recovery model update they are seeing a surplus of 1.8 million which is just over the amount required to reach that level of return.
Epcor Water Services have indicated the rates for water will be increased for January 2018 by 5 percent.
Jason said they have reviewed carefully the water utility budget operation point of view and also assigned those costs of both direct and indirect costs. As part of the update they also spent some time on capital costs. The opening reserve balance at the end of 2016 was sitting with a balance of $175,000 and with their proposed draft long range capital plan project identified in the water utility function they have capital projects just over $13 million dollars between now and the year 2038.
Comparing that to the excess of funds they expect to bring in each and every year, they would end up in this reserve with a positive overall balance of just over11 million. The model itself will indicate that we are proposing the water rates go up.
Manufactured Home Park
Jason said a small change made to the Water Rates Bylaw 2.18. under manufactured homes which indicates that unless otherwise noted within a signed development agreement with the manufactured home community the Town shall supply water to a master meter vault only.it will then be the responsibility of the land owner of the manufactured home community to distribute this water to each site as they deem necessary. Only one invoice shall be issued to the landowner of the manufactured home community for the total water.