Residents who pay into the Regional, North and South Pender water services should brace themselves for big increases on their utility bills.
User rates for the Regional Water service – which covers the region south of Pender Harbour outside the Town of Gibsons service area – have increased 43 per cent to $410.85 from $287.31.
North Pender Water service rates rose 50 per centto $416.61 from $277.74. South Pender rates climbed 28 per cent to $529.14 from $415.
“The community has been very, very clear that water needed to be a priority for this board, so this is what that looks like. When we make water a priority, of course it’s going to cost more,” Sunshine Coast Regional District (SCRD) chair Lori Pratt told Coast Reporter April 23, as utility bills began showing up in people’s mailboxes.
She acknowledged all directors had been dealing with questions from homeowners about the increases.
The overall utility bill also includes wastewater, sewer and garbage collection fees.
A resident who spoke with Coast Reporter described the increase as unreasonable. “A 25 per cent increase of anything in one year is pretty outrageous,” he said. “But 40 plus per cent is something biblical.”
Other residents took to social media to express surprise at the increase and why it hadn’t been clearly communicated.
The other half of the funding equation for water service – parcel taxes – also climbed, but at the smaller increment of five per cent for the Regional and South Pender water services. North Pender parcel taxes didn’t change.
Parcel taxes, calculated based on property size, don’t show up on the utility bills sent out in late April, but form part of residential property tax bills.
Since at least 2013, the combined parcel and user rate annual increases to fund the water service have been stable at between two and five per cent, which last year worked out to a combined increase of $19.
But this year, the 10,500 households dependent on the Regional Water service are facing a much larger overall increase, about $158 for the average homeowner.
Directors approved the change earlier this year at a Jan. 30 board meeting.
At the time, staff justified the hike because of a flaw in how the money has historically been divvied up to pay for water infrastructure.
Normally, parcel taxes are supposed to fund capital costs such as upgrades and replacements, while user rates cover operating costs such as maintenance and staffing.
Earlier this year, staff explained to the board that existing user rates aren’t enough to cover the actual costs of operating the water system.
In 2019, for example, 30 per cent of revenue from parcel taxes was diverted to cover operating expenses. That gap was set to increase to about 50 per cent if nothing changed.
Meanwhile, more than two-dozen water projects had been included in the 2020 budgets. Staff also acknowledged that the funding model used to set rates is out of date, and on top of that no accurate service and asset management plan exists for the system.
Staff have warned directors the regional system “is expected to continue to have substantial funding requirements in the upcoming years.”
When asked why this wasn’t addressed until now, SCRD chair Lori Pratt told Coast Reporter, “I can’t speak too much to historical decisions, but one thing we know is if you continue to kick something down the road, eventually it’s going to come to roost where you have to deal with it.
“We’re at a point where we have to make a lot of tough decisions.”
Increasing user fees will lead to more transparency, she said, since it will keep capital and operational funding separate and will show residents the true cost of maintaining the service.
Asked why the board didn’t choose a more gradual increase or scale back projects to reduce the impact, Pratt said: “We were given a mandate by the public that they want us to do what they elected us to do.”
Pratt acknowledged that despite directors’ emphasis on communicating the increases, with COVID-19, “it is possible that some of this may have been missed,” or that “anything we had put out before has gotten lost.
“We’ve had a very different focus over the last six weeks,” she said. “We can always learn how we can do better.”
After COVID-19 restrictions hit in March, directors amended the budget to bring down the property tax increase, but they didn’t touch water fees. That’s because utility rates and parcel taxes have to be set earlier in the year. “Legislatively, we had our hands tied,” Pratt said.
