By Barb McKay
Kincardine council proved last Wednesday that it is open to merging the municipality’s water system with Tiverton’s system, but Tiverton residents likely won’t see any refunds.
Tiverton ratepayers sat in the gallery during last week’s council meeting waiting to hear if the municipality would answer their request to combine the two water systems and bring Tiverton rates in line with Kincardine’s.
Currently, Kincardine residents pay a fixed rate of $24.65 per month for water plus a consumption rate of 80 cents per cubic metre. Tiverton residents pay $34.57 per month plus a consumption rate of $1.02 per cubic metre.
Municipal staff provided a report to council outlining four options for consolidating the water systems, one of which is to leave the rates at status quo. Staff noted that it is more costly to operate and maintain the Tiverton system than it is to operate the Kincardine system. In 2011 and 2012 it cost the municipality on average $205 per connection to operate Kincardine’s water system and $350 to operate Tiverton’s system.
The recommended options for combining the systems come from a water rate proposal developed by Hemson Consulting, which the municipality engaged to come up with a water rate schedule up until 2020.
Along with possible scenarios for merging the two systems, staff also suggested that council consider retroactive payments to Tiverton ratepayers for the difference in rates, back to January 2012. The refund would deplete water reserves by more than $40,000.
Several councillors were quick to question why the municipality would reimburse Tiverton residents for the difference in water rates.
“Tiverton ratepayers were adamant that they be on their own system and they would pay for it,” said councillor Maureen Couture. “If we were to merge the two systems I would strongly disagree with any increase to Kincardine ratepayers. Tiverton is getting a break and any increase would be unfair.”
Mayor Larry Kraemer said he was on council when the Tiverton Ratepayers Association requested that Tiverton’s water system be separate from Kincardine’s.
“The direction out of Tiverton was that they wanted it this way,” he said. “I would have a hard time supporting a change to the system.”
“I have no personal or political will to add seven per cent to my water bill so Tiverton users’ (bills) can go down by 15 per cent,” councillor Ken Craig added.
Councillors were not enthusiastic about any of the options presented. The first option would combine Tiverton and Kincardine costs based on predictions from 2011 on the number of users expected to hook up to the systems up until 2020 and uses an average annual consumption rate of 300 cubic metres of water. Under that scenario, the fixed rate for 2013 for all users would be $27.69 per month plus a consumption rate of 84 cents per cubic metre. Kincardine residents could expect to see an annual increase of $12.48 this year and Tiverton residents would see a decrease of $136.56. By 2020, Kincardine residents would pay an additional $16.80 per year, while Tiverton ratepayers would see a drop in their rates of $170.28.
A second option accounts for more recent consumption patterns, which have decreased in the past year.
Connections have also decreased to 4,482 from 4,531. Based on that, the fixed water rate would stay at $27.69, however the consumption rate would jump to 94 cents per cubic metre. That would mean that Kincardine residents could expect to pay an additional $42.48, on average, this year, while Tiverton residents would see their water bills drop by $106.56. By 2020, Kincardine rates would increase by $52.80 per year, while Tiverton rates would decrease by $134.28 per year.
A third option combines the baseline analysis from the first option and consumption patterns from option two. However, this would result in a decrease to water reserves of $770,000 from 2013 to 2020.
Craig suggested that the municipality could freeze Tiverton rates and allow Kincardine rates to catch up until there is parity, an idea that other council members expressed satisfaction with. Kraemer noted that Tiverton rates could be frozen until they move into a range that is fair for both Kincardine and Tiverton residents (three per cent difference) and then the rates could be merged. Council directed staff to bring back proposal of how to implement the plan before the next billing cycle in February 2014.