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Water and sewer rates on rise, but operating costs still unknown

Water and sewer bills will be going out next month, but setting the rates with an eye to the future has been a challenge for the Village due to major utility projects still being in the works.

In order to understand how the proposed rates for water and sewer are set, Nakusp mayor and council attended a presentation by CAO Linda Tynan, CFO Rob Richards and Director of Operations Mike Pedersen.

The two utilities have had major projects in construction for years now, and unknowns about what it will take to run them has made forecasting costs difficult. Once the sewer and water treatment plants are up and running, long term financing strategies will be possible and a priority, said Tynan.

The major overhaul of both sewer and water treatment was long overdue, said Pedersen, who told council that Nakusp has been at close to its maximum capacity for both for a long time.

“Did you know the Village was experiencing a water crisis?” he asked. Growth in the population has been severely limited by water and sewer capacities. For example, a shift in the course of the Kuskanax River one year had resulted in the need for watering restrictions. The inability of sewage lagoons to empty in time for more waste input was another sign that major changes needed to be made.

Until the new water system, Nakusp has been using water that is technically untreated. Although the water is filtered and chlorinated, the water is considered untreated. With the new system that includes UV treatment, the Village will be bringing its system into compliance with water regulations.

What the cost of that compliance actually is, is still unknown. Although Pedersen said that at the moment, chemical costs are high and likely higher than what they will be with the new system as the amount of chlorine required will drop, what operating costs will be are still undetermined.

A bright light on the water side is the micro-hydro plant, which was not only financed one hundred per cent by grants as a green technology, but will also be generating money as well as power. The plant was started up on Wednesday, Jan. 15, and a conservative projection is that it will bring in $30,000 a year.

Mayor Karen Hamling commented that it was indeed one of those projects where Hydro “pays us  [as small power producers] more than we pay them” that has been criticized for driving up consumer Hydro rates. In this case, to the advantage of the Village.

Another part of the water system upgrade is the development of Well #2, a second source of water that with its flow rate of 60 litres per second (versus the first well which flows at 25 litres/second) will easily supply redundancy for the entire water system. It will also make expansion of water up the north road a possibility.

With the need for an upgraded sewer system, the Village took advantage of the opportunity to develop green components such as a water reclamation system. This system will filter water and make it usable for irrigation of fields and green space in the Village. Grants that have made work on the waste water system have been available because there are innovative green components, which have been drawing a lot of attention from around the province.

The advantages of the reclamation system are potentially very large: Nakusp would be able to meet its Water Smart water reduction targets of 15 per cent by reclaiming and using only 25 per cent of the daily sewage flow, said Pedersen. The 15 per cent reduction could be achieved in phase one of the project alone, which would irrigate the fields near the arena, he emphasized.

A potential barrier to water reclamation could be public perception, Pedersen noted, but once the public accepts it, the system could be used to provide water for green spaces at schools, cemeteries, as well as parks and along the waterfront.

Although the project is not online yet, there is already 1.5 kilometres of pipe in the ground; only pumps and a few extra pieces of pipe are needed.

Another green innovation on the sewer side of things are the Hex covers that prohibit algal blooms in the sewer lagoons. With the reduction of algae, there’s the hope that the amount of sludge – a byproduct that needs to be managed – will also be reduced. This year will be about testing the systems, finding out the costs of operating them, and fine tuning them as necessary, Pedersen told council.

Because there are so many unknowns in terms of the costs of operating these new systems, it has been difficult to forecast the costs for the next year’s budget. Both Tynan and CFO Richards were very clear that because the costs are to be determined in 2014, they have made only estimates in terms of revenue generation  and costs. What the actual costs will be is to be seen.

In 2014, more capital projects are on the horizon, one of which is the upgrade of the SCADA system which monitors all water, sewer and public works systems remotely. It’s an incredibly powerful tool, said Pedersen, who also said it’s necessary to stay current with the specialized technology. There are potentials for more costs over the next years, and technicians are expensive, said the Director of Operations. Another taller tower needed for the system will be installed at the Public Works yard.

The well protection plan will be completed in 2014 as well, which will protect groundwater from contamination, at a net cost of $16,000.

Sludge management may become a necessity, but magnitude of the need remains to be seen until the sewer treatment plant has been in operation for a while. In the preliminary budget, $50,000 has been earmarked for sludge.

The lift station fence by the Japanese garden along the waterfront has seen better days and will get a facelift itself this year.

The million gallon liner for the reservoir is also on the list for completion, with the Request For Proposal out and due to close in March of this year.

Even further on the horizon will be the consideration of more capital projects such as water metering, expansion of water up the north road, upgrades along Alexander and Shakespeare roads.

What all the discussion boiled down to was a change in rates, rates which  Richards said the Village is working to ensuring are reasonable. There may be slight changes to categories in order to align them with “reasonableness,” he said, in response to feedback from Village residents and business owners. For the moment, rates are scheduled to increase by two per cent for water and five per cent for sewer. The first three readings passed, and the final reading will come to the Jan. 27 council meeting.

 

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