Column: October 6, 2016

An Update on the Water, Wastewater and Stormwater Rate Review

Earlier this year, residents were informed of the City of Ottawa’s Water, Sewer and Stormwater Rate Structure Review. At that time several public consultations were held – which were well attended and at which City staff received a lot of constructive input from the residents. This led to the delay of the report so that comments received could be properly reviewed.  Since then, staff worked with members of Council on finalizing the report and its recommendations. This report, which was released on Monday, October 3, will be presented to the Environment Committee on Tuesday, October 18.

The history on this issue is important and stems from amalgamation. Prior to amalgamation, residents contributed to stormwater management. Some paid for it through their general taxes, some through a specific stormwater rate and others as part of their sewer bill. The transition board overseeing the implementation of the amalgamated City of Ottawa commissioned a report which provided recommendations on how an amalgamated city could assess properties for stormwater costs. That report recommended cost collection through either the general tax rate or a specific fee charged as a line item on your tax bill. In April of 2001 however, Council instead voted to shift all stormwater costs to the water and sewer rate. This meant that some residents who used to pay for it no longer did and it also meant that residents who had always been paying for it started paying more.  For fifteen years, that is the system the City has been using.
 
The consultations held in the spring laid out proposals to move away from that system and create a new rate structure where those who receive a service pay for it. The main objective was to collect $42M across the City through a new stormwater fee, shifting those costs away from the water and sewer rate budget. The feedback on that proposal was met with much opposition, which brings us to the proposal before us today.
 
The financial details of the proposed rate structure are highlighted in the graphic shown at the bottom of this page. It illustrates a tiered approach in assessing properties for stormwater management. The tiers are based on level of service provided. For villages on water and sewer in communities like Carp, you will only notice a change in how your bill is presented. There will be a reduction in your bill on an average of $2 per month. For property owners on private services, the proposed monthly fee would be $1 for 2017, $2 for 2018, $3 for 2019 and $4 for 2020. The report proposes a phasing in of the charge over four years, meaning you would not pay the full $4 amount until 2020. This is something that would be paid annually on your tax bill (agricultural and forested lands will be exempt).  
 
I think it is important to point out that the total amount collected rurally through this updated charge will be $2M, which will go directly toward the $8M which is actually spent per year on rural stormwater services. This indicates that rural residents, while contributing towards stormwater services, will still be receiving more services than what they are actually paying for. This proposal certainly isn’t perfect, but it is a step forward from what was originally proposed when introduced last spring.
 
This report has been released a week earlier than normal so that residents can have an opportunity to digest the information. If you would like to address the Environment Committee on October 18 and provide your input, you may register to speak by contacting the Committee Coordinator: Christopher Zwierzchowski, Christopher.Zwierzchowski@ottawa.ca, 613-580-2424 x21359.
 
Note:  Pre-amalgamation, when all residents contributed toward stormwater services, many were permitted to fill in their ditch provided it did not impede drainage. That permission was removed in 2003. As a result of what we heard at the consultation sessions last spring, the report going to the Environment Committee on October 18 will recommend a review of the Ditch Alteration Policy with a view to develop a process to, once again, permit the infilling of ditches. This policy review will come to Agriculture & Rural Affairs Committee in 2017.

Column: May 28, 2015

Water, wastewater & stormwater structure review
 
On May 19, city staff tabled a Report entitled “Water, Wastewater & Stormwater Rate Structure Review” at the Environment Committee. This report made a recommendation to study the way the City charges for water, wastewater and stormwater services.
 
The City currently operates their rate structure for water and wastewater services based on a 100% consumption basis, based upon metered water usage. This rate structure has two principal limitations. First - only customers who pay for water and/or sewer services contribute to the cost of stormwater operations and infrastructure, however stormwater services benefit the entire community, rural and urban. Second - revenues for stormwater services are based on metered water consumption volumes, but the cost that drives rural stormwater management is related to runoff from properties. This lack of correlation between revenue and expenditures does not provide an equitable basis for allocating costs.
 
Currently, an excess of 45,000 properties do not have a water meter and are not charged for water, wastewater or storm water services. Of these, around 30,000 fall in the rural area and benefit from the stormwater system without contributing to the maintenance.
 
City staff are not recommending that rural residents with private wells and septic, pay sewer and water fees. They are looking to find a more effective and equitable way to incorporate the fixed cost of stormwater management (cleaning ditches, maintaining cross road culverts).
 
Please keep in mind the following:

  • The proposed study would look at best practices in other municipalities to see what options are fair and equitable.
  • The goal of the study is to ensure the system’s financial sustainability.
  • At this point, no new rate structures have been proposed
  • Prior to amalgamation, all or part of the cost of maintaining stormwater infrastructure was funded through the general property tax bill.
  • During amalgamation, these charges were transferred to the water bill resulting in some Ottawa properties receiving the benefit of stormwater services without contributing to them.
  • If approved by Council, staff will conduct the study, which will include a public engagement component and will report back to Committee and Council with options for a new rate structure in early 2016.
  • Any new rate structures approved by Council would not be brought into effect until 2017.