Rural residents oppose water fee

In fall 2008, the City commenced a comprehensive review of the costs of delivering drinking water, and provide sewage and storm water treatment services to Ottawa residents. The goal was to examine how costs should be recovered to ensure sustainable service delivery over time.

The issue arose when an unusually wet spring and summer reduced residents’ use of municipal water, leading to a significant revenue shortfall for the city.

While rural residents on wells and septic systems do not receive water services from the city, there was a proposal to charge them for storm water service in order to fund extensive infrastructure repairs. Essentially, rural residents would be charged for the water that falls from the sky.

The CVCA raised these concerns to residents, in a public notice.  As the result of strong feedback from rural residents, the city has decided to re-examine its original proposal. 

In its report to committees and council on April 6, 2010, the city noted concerns raised by rural residents:

“Most public feedback was from the rural community. Rural interest in this issue was largely due to the potential consequences of shifting roadside drainage costs from the Water and Sewer Bill to the Tax Bill.

 Specifically, the following issues were raised by the rural community:

• In the absence of resolving several or all of the above issues, most rural landowners felt that Option A was preferable.

• Several rural landowners suggested another option that entails reclassifying roadside drainage as a “road” service instead of a “stormwater” service.  This would achieve four things:

It would put these service costs where rural residents thought they were, and most felt they should be, that is, on the tax levy.

It would allocate the costs on the City-wide basis as is the case with all other road services, and mitigate significant tax increases to rural property owners.

It would improve the linkage between those paying for the service and those delivering it.

Based upon analysis of the alternatives and consideration of public feedback, staff recommend the following:

1.  That the current rate structure remain in place in 2010.  Changing the rate structure requires changes to the City’s billing system that will take six to eight months to complete.  Furthermore, the public will require adequate notice of the change.
2.  That separate rates be established for drinking water and wastewater services.  Full cost accounting has been carried out for both service areas and wastewater costs (including stormwater) are not100% of drinking water costs; nor are they likely to be over time.  Furthermore, several areas of the City have only one of two services.  Tracking and recovering them as a separate fee from drinking water would achieve greater transparency of wastewater and drainage charges.  A separate “sewer” rate would address all three of these matters.
3.  That a “base plus volumetric” rate structure be introduced in 2011.  The current rate structure does not yield stable revenues, and causes significant operating losses in both the drinking water and wastewater and drainage service areas when “projected” sales do not meet “actual”.  A “base plus volumetric” charge will provide greater revenue stability by guaranteeing recovery of 20-30% of annual projected rate revenues, regardless of actual water sales. 
4. Options for recovering stormwater and roadside drainage costs should be studied further; and in the meantime remain embedded in the “sewer rate”. 

Those on private services, largely in the rural area, raised several issues regarding roadside drainage that warrant further investigation.  The City needs to better demonstrate value for money to unserviced landowners before transferring any or all roadside drainage costs back to the tax bill.”