Greater Vernon water costs could climb

Staff presented the Greater Vernon Advisory Committee with a proposed 2015 water utility budget that calls for a four per cent hike in rates

It may cost more to turn on the taps.

On Thursday, staff presented the Greater Vernon Advisory Committee with a proposed 2015 water utility budget that calls for a four per cent hike in rates.

“No one likes to see an increase but it’s reasonable,” said Juliette Cunningham, chairperson.

In a report, staff says the water utility’s long-term capital program must focus on replacing aging infrastructure, expanding to provide additional capacity and improving water quality to meet provincial regulations.

“A modest rate increase of about twice the rate of inflation is proposed,” said Stephen Banmen, general manager of finance for the Regional District of North Okanagan.

“The rate increase provides for an improved capital program funded from current revenue and provides for reserves to be set aside for years when the capital funding needs are greater.”

If the rate hike goes ahead, the current revenue funding of the 2015 capital program would increase from $4,5 million to $4.7 million.

Among the possible projects this year are a water main replacement on Highway 6 for $66,000, a low-level outlet repair at Aberdeen Lake for $400,000, water main upgrades on Pleasant Valley Road for $490,000, a meter replacement pilot program for $250,000 and a water main on Venables Drive for $600,000.

The rate increase would also provide additional funds for future capital projects through a $736,000 increase in transfers to reserves.

“We should be building up reserves so we can replace assets when they need to be replaced,” said Banmen.

Director Bob Spiers doesn’t support pumping money into reserves for long-term capital projects because he believes the financial onus is placed on existing customers and not future users.

“The ones benefitting should pay,” he said.

The overall proposed 2015 water utility budget is $15.07 million while it was $14.1 million in 2014.

A decision on 2015 water rates may occur when GVAC directors get together Feb. 5.

“It will be an interesting discussion at the meeting,” said Cunningham.