WATER and sewer rates are set to rise in Winnipeg for the 10th-straight year as the city continues to whittle away at multibillion-dollar tab for new sewage-treatment facilities and sewer replacements.
The average Winnipeg household will spend $939.32 on water and sewer bills in 2013, an increase of $38.32 from this year, based on a 4.3 per cent rate hike proposed by the water and waste department Thursday.
In a report to council's public works committee, water and waste finance manager Moira Geer notes the proposed hike is less than a 6.5 per cent hike initially projected for 2013. "The cost of Winnipeg's high-quality water and sewer services remains very affordable at a third of a cent per litre," she writes.
But overall, water and sewer rates have risen 88 per cent in Winnipeg since 2003, when the average city household spent $500 on water and sewer bills. Prior to that, rates were frozen for two years.
The biggest reason for the increase over the past decade is Winnipeg's ongoing wastewater-treatment upgrade, which will cost the city no less than $1.8 billion by the time it wraps up in the next decade.
In 2003, in the wake of a sewage spill at the North End Water Pollution Control Centre, the province ordered Winnipeg to improve all three of its sewage-treatment facilities and replace combined sewers with separate stormwater-drainage and sewer pipes to reduce the number of diluted-sewage spills every year.
This upgrade is Winnipeg's most expensive and ambitious project. For example, a new nutrient-removal facility planned for the North End sewage-treatment plant will cost $380 million alone, according to budget documents, while work underway at the South End plant is already $70 million over budget due to construction inflation, Geer's report states.
The tab for upgrading combined sewers, meanwhile, could cost billions more, with the final tab dependent on whether the city replaces all the old pipes or builds more underground stormwater-retention tanks instead.
City council public works chairman Dan Vandal (St. Boniface) said the city is having trouble paying for this infrastructure because the other two levels of government have only committed $256 million toward the wastewater-treatment upgrade.
In 2007, Ottawa pledged $50 million, while the province committed $206 million. The original improvement order expected each level of government to pay a third of the tab.
"The other governments aren't paying any attention to that," said Vandal, surmising sewage treatment isn't a particularly sexy funding priority for Ottawa and Broadway. "I get the dilemma. It's not an envious situation we're in."
Geer's report says maintenance and inflation are also driving up water and sewer rates. But water and sewer bills also include the cost of an eight per cent water and waste department dividend, which is transferred to general revenues each year to help cover other city operating costs.
Vandal was critical of such transfers before he joined council's executive policy committee. He now says a dividend is an appropriate move for a city-owned utility.
"It diversifies our revenue away from the property tax and away from the business tax. That's how I've justified it over the past few years," he said.
Rates on the rise
Water and sewer rates in Winnipeg have increased 88 per cent over the past 10 years, mainly because the city is struggling to pay for billions worth of new infrastructure. Here's what the average city household has paid in water and sewer bills the past decade:
2013 $939 (proposed)
2014 $980 (projected)
-- Source: City of Winnipeg, water and waste department