In an effort to not get caught without an umbrella, the City of Dauphin is approaching the Public Utilities Board about a possible increase in its water and sewer rates.
Mayor David Bosiak said the city has been receiving hints from provincial agencies such as the Manitoba Water Services Board.
“And there was a presentation at the last AMM convention again saying don’t get behind. If you ever get behind, you’ll never catch up in the sense that if your rates don’t match your operational costs and provide some funding for the future, just to make sure that your reserve has funds so that when you have to fix pipes or anything else, you have the ability to do so,” Bosiak said.
The City, Bosiak added, has been reluctant to ask for an increase because it is still experiencing a 30 per cent loss of treated water somewhere within its system.
“Because they’ll likely say ‘well you have a 30 per cent water loss still in your system. Fix that, or address that and then we’ll talk about potential rate increase’,” he said.
While the City does not have the problem of some southern municipalities, which are experiencing explosive growth, its issues stem from aging infrastructure.
“We’ve been working to reduce the amount of water loss in the system. Now as you can imagine, half the town has got nearly 100-year-old pipes,” Bosiak said, adding while the underground system is aging the rest of the water distribution organization is extremely efficient. “The guys at the water treatment plant, they do it very well and it’s modern, but our problem is our distribution system.”
It is kind of a Catch 22 situation, Bosiak said, as senior administration is promoting the need to spend money to improve the system, but the costs of doing so are exceeding the City’s ability to pay for the improvements.
“All that income and expense has to be in the water utility side, not on the general revenue side,” Bosiak said, adding he appreciates the efforts of senior administration in providing a heads up for council. “So these are just sort of warning shots, saying it takes time to have a rate increase approved. There’s usually conditions applied to it and then those funds need to match your operations. So all we’re doing is being prepared.”
In its application, the City is seeking an 11.7 per cent increase in 2024, 4.2 per cent in 2025 and 2.3 per cent in 2026.
Also waiting in the wings is the long-awaited expansion of the City’s lagoon system, the cost of which is expected to increase significantly from its original $10 million to $12 million as a result of inflationary pressures.
“So again we will be debenturing to pay for that, but we also have to have enough revenue in our water utility reserve to make sure that other stuff doesn’t kick us in the teeth,” Bosiak said, adding in conversations with other municipalities he is hearing some are struggling to make ends meet.
“What we’re trying to do is to be in front of it. Our rates are generally middle of the pack or maybe to the lower end in terms of municipalities of our size and other jurisdictions. So we believe this is sort of a somewhat modest increase.”
