City Council Monday night approved a 10 per cent hike in its sanitary sewer surcharge.
That means based on approved PUC water rates, residents can expect to see their annual water bill increase by $73.64.
Sanitary sewer surcharges effect residences attached to the city’s sewer system and the surcharge, as it has been since 1962, is directly tied to a homeowner’s overall water use. The 10 per cent hike brings to surcharge rate to up 80 per cent.
The 10 per cent increase is expected to help generate $3.3 million for debt servicing for the sanitary portion of the coming biosolids project as well as other capital expenses.
The biosolids project – a requirement of the province – is earmarked for construction in 2024, at an originally projected cost of $40.7 million. Updated estimates peg the price tag as higher. City staff is working with the project design team to bring the cost down but it’s clear with volatile construction costs the city will be unable to manage financing the long- term debt the project creates with what it collects now.
Ward 4 Coun. Marchy Bruni, alluding to residents likely facing higher taxes next year, asked if the current surcharge of 70 per cent could remain in place through the months June, July and August. Residents will be looking to maintain lawns and gardens and other outdoors interests. He asked what impact that would have on revenues when the biosolids project is anticipated to begin in 2025.
Chief Financial Officer Shelley School said consultation with PUC would be required to answer that question. Bruni then asked if the rate increase decision could be deferred, pending a response from the PUC.
Chief Administrative Officer Malcolm White said the 10 per cent increase is necessary to meet immediate needs adding further increases could be coming.
“As the report states, we need to increase the sanitary sewer surcharge to provide finance for future projects,” said White. “It’s quite likely that as we go through our sanitary sewer master plan and other studies that we’re doing over the year to come, we’re going to need further increases.”
White said the Sault’s surcharge rate is the lowest in Northern Ontario. Future projects include upgrades to the city’s East End Treatment UV disinfection process. The current equipment is obsolete and the
manufacturer won’t be able to provide parts in the future as needed. The cost to replace the current system is expected to exceed $7 million.
The cost of the West End Treatment Plant’s phase 2 upgrades, planned for 2025 are in excess of $40 million. Bruni said with an expected tax increase coming in 2024 “we need to help out the residents as much as we can.”
Mayor Matthew Shoemaker agreed with Coun. Bruni that costs should be tempered for taxpayers as much as possible but said without an increase for sanitary sewer uses, the city would have to compensate by hiking rates to include all taxpayers, including non-users.
The reality is, he said, is that the service is being paid for by the people that use it. “It is, unfortunately what we’re faced with,” said the Mayor. “We aren’t choosing to move to organics collection and biosolids processing. The province is requiring us to do that. So we are essentially having to increase our costs, to pay for something the province is requiring us to do. Not because we want to but because we have to.”