Water rate proposal could lead to lower bills, ongoing conservation
London Community News
By Sean Meyer/London Community News/Twitter: Newswriter22
There is still a long road to go before council adopts a new water rate structure, but there is a good chance when it does happen, the majority of London residents will be happy about it.
During the Civic Works Committee meeting on Monday (Oct. 22), councillors were presented with a report that laid out the benefits of a new model that would include a 30 per cent fixed cost. However, with 70 per cent of the water bill being a variable figure controlled by usage, those who choose to conserve will still be able to keep their costs down.
The current system has a one per cent fixed cost and a 99 per cent variable component. However, staff has repeatedly said the current system is unsustainable and would lead to seven and eight per cent increases, perhaps even higher, every year through 2018.
When asked to explain the savings, John Braam, managing director environmental and engineering services, said the average user in London utilizes about 15 cubic metres of water and sanitary services on a per month basis. The reduction staff is suggesting would see the 15 cubic metre per month user pay about $3.73 per month less than under the current structure.
That current structure, Braam said, was first created in 1991 and staff has been working since approximately 2004 to restructure it into a sustainable funding model. The current system has seen declining water-related revenues since 2001.
Ward 12 Councillor and Civic Works Committee chair Harold Usher said there was a lot for people to like in the report.
“This is a big step we are taking and it is going to be extremely difficult to beat this when you look at the overall basis,” Usher said. “Yes, granted, there are a few people who will pay a little bit more. There are one or two industries or institutions that will pay, relatively, a lot more. Apart from that, there are lots of people who will pay a little bit less.”
The report presented to Civic Works, which was accepted as information by the committee, will be used next month during a public participation meeting. Several members of the committee said their constituents were afraid a model with too high a fixed component would impact on their ability to save money through water conservation.
Roland Welker, division manager water and engineering, joined Braam in delivering the report prepared by BMA Management Consultants Inc. Welker said the model staff is presenting for discussion will continue to drive local conservation efforts.
“Every customer — residential, industrial, commercial — can reduce their costs by using less water. It is very simple; there is no magic to it,” Welker said. “And this is what our customers have been doing; they are smart people. It is what we expect them to continue doing.”
Mayor Joe Fontana said the proposal was “just about where council wanted to be” and that the rebalancing the proposal suggests would address a number of questions.
“What we also want to do is to make sure for those people who want to save money they can through the variable rate,” Fontana said. “Regardless of whether we increase the rates, they will still be empowered to do as much as they possibly can to reduce their water charges because the variable rate is the higher.”
Ward 10 Councillor Paul Van Meerbergen said he was quite happy to see the details of the report, which he called a “real improvement” over previous calls for a 100 per cent fixed rate system.
Van Meerbergen explained the proposed model simply by focusing on the suggestion the first seven cubic metres of water used would not see a volumetric charge. That would be covered by the 30 per cent fixed rate.
However, as the new system would deliver multiple opportunities for savings, Van Meerbergen said there were “a lot of positives” around the proposal.
“The net result is they pay less than they do now. That is a real improvement. While allowing the average home to also have reduced costs. That is another bonus,” Van Meerbergen said. “I think we have achieved a really good hybrid model by having 70 per cent volumetric, so still the majority by far. That is still a powerful tool that London residents want to keep in their pocket, they have ultimate control and destiny over their financial expenses.”
Ward 4 Councillor Stephen Orser said he was concerned by the use of even a 30 per cent fixed component, calling it “a slippery road that becomes an endless well to push a lot of money into government bank accounts.”
Welker, however, pointed out council has ultimate control over what the ratios of fixed and variable would be. And despite the consultants report suggesting a fixed number of 40 per cent, Welker and Braam both agreed the 30 per cent number gets the city to a sustainable system in a timely fashion — in the case of the water rates — approximately two years sooner than originally anticipated by staff.
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