London Community News
By Sean Meyer/London Community News/Twitter: Newswriter22
As city staff updated councillors on progress towards establishing a new funding model for city water, at least one thing was established — residents don’t understand how valuable the resource is.
During the Civic Works Committee meeting on Monday (Sept. 10), councillors heard a report from the administration on progress towards coming up with a new formula for charging residential, industrial, commercial users for not only water, but wastewater and storm water services.
John Braam, managing director engineering, told the committee members the process to engage the city’s customers “is in full swing,” and that work is continuing on establishing what the proper levels for water charges should be. As Braam said, the report presented by him and Roland Welker, division manager water engineering, provides the committee with “some indication of where we are and where we are moving with respect to a value-based process for determining what our rates ought to be.”
Braam said the process currently underway is about placing a value on water, wastewater and storm water services, not just as a commodity, but as measurements of quality of life, public health, fire protection and community and economic development. That work will culminate in a public meeting on the fee structure that is set for Oct. 2.
“The ask to 110,000 customers is to how they would balance the different needs of our schools, our hospitals, our industries, our small business and our residential customers,” Braam said. “We have taken deliberate aim at identifying how the funding model would be structured. Fundamentally, we don’t see it structured significantly different from what we currently have.”
While the goal is to keep the system revenue neutral, Braam said “the issue of real importance” is found in four main areas: low-income customers, low volume customers, high volume customers (industrial, commercial, institutional), and the conserving customers.
“There is significant disparity in the way the rates are applied at this point in time,” Braam said. “The intention of staff is to come back with a fair and balanced approach to our rate-setting processes.”
Welker said the “struggle” for staff at the moment is in considering providing incentives or benefiting one of these sub-groups. “If we do . . . then how many dollars do we want to put into the pot? That is not a technical decision, but very much a political decision.”
In addition to remaining revenue neutral, Welker said the new funding model is a “redistribution of who pays what.” However, he also said there is an option of having additional revenue added for things such as fire protection. “That is a political decision as well.”
Mayor Joe Fontana said he didn’t want whatever funding model was eventually created to “penalize” those residents who are conserving their water or who are low-income or low-volume users, “by virtue of who they are and what they do.”
Ward 5 Councillor Joni Baechler asked staff if they will be bringing forward a variety of potential funding scenarios for people to look at. Braam said that was staff’s every intention.
While the committee would vote to receive the report for information purposes, Ward 4 Councillor Stephen Orser had another question in mind. Orser wanted to know if “low consumption” was one reason for the drop in city water revenues, based on the seemingly increasing popularity of people purchasing bottled water for drinking.
Braam said people’s inclination to drink bottled water wasn’t a significant issue when it comes to the city’s declining revenues.
“Low consumption is never a problem; it is a benefit,” Braam said. “The revenue source that follows with it, yes, this is all about sustainability, about making sure we can replace the things we need to replace.”
Braam said one thing many people are missing is that the water service is so much more than just the delivery of water for consumption. It ranges, Braam said, from health issues, sanitation and fire protection as well.
Ward 8 Councillor Paul Hubert, who isn’t a member of the committee, but was sitting in on the meeting, said Orser raised an interesting point in that the public continues to under-appreciate the value of the city’s water. Particularly, Hubert said, when it comes to consumption.
“They can use our water our water at a far cheaper per litre cost than if they were purchasing at a retail outlet,” Hubert said. “It isn’t so much on the revenue side for us, but the expense side for the consumer. Use our water, it is cheaper, it is a better value proposition.”
Find us on Facebook: London Community News