After the SCRD discovered a miscalculation underfunded nine community wastewater plants, some Sunshine Coast Regional District (SCRD) residents are bracing for an unexpected fee increase in their utility bills.
At a Feb. 17 committee meeting, general manager of infrastructure services Remko Rosenboom said staff is “not proud” of the miscalculation presented to the board in November. At the time, a “limited scope” was applied to initial user fee rate reviews. He said they will be improving internal processes, after Halfmoon Bay director Lori Pratt said she is frustrated and asked if any safeguards would be put in place.
The miscalculation was caught during the finalization of the 2022-2026 financial plan, which was adopted on Feb. 24. While reviewing the 15 wastewater services, nine were discovered to not have sufficient funds to operate each plant through 2022 user fees. In 2020, wastewater treatment plant user fees were partially increased to fund the full operations, and operational funding shortfalls were funded from operating reserves, Rosenboom reported.
The amount underfunded varies for each. One service – Square Bay – does not have enough operating reserves to cover its 2022 shortfall of $28,206. Local governments cannot budget for a service deficit, Rosenboom said.
For those on the Square Bay community sewage treatment service, users will now see user fees increase by 23.58 per cent ($150 per user). This will collect $12,150 additional user feed to address some of 2022’s underfunding, while deferring several projects until the 2023 budget process is expected to make $16,500 of additional operating reserves available (43 per cent of the anticipated underfunding). If directors had chosen not to defer these projects, the 2022 user fee would have increased by 54.75 per cent ($348.22), according to a staff report.
Operative reserve levels would still be below the set target level for the Square Bay system, which the staff report states would “create some risk that any unforeseen major expenditures would need to be funded from 2023 user fees or a levy.”
At the Feb. 17 committee meeting, resident Peter Galbraith addressed directors and said attempts to engage with the SCRD has been “challenging” and called for better community engagement.
The eight other underfunded plants will be funded through their operative reserves: $2,266 for the Jolly Roger service, $680 from the Secret Cove operating reserve, $468 for Greaves Road, $7,095 from the Lily Lake operating reserve, $2,224 for Sakinaw Ridge, $10,943 of the Roberts Creek Co-housing operating reserve, $5,378 of the Woodcreek operating reserve and $5,987 for Langdale operating reserve.
The operational costs for wastewater plants are supposed to be funded by user fees while the capital costs are covered by frontage fees. But staff report the user fees were never increased to fully fund the operation expenditures, and contributions for the 2020 and 2021 operating reserves were used to compensate for the underfunding.
Ongoing infiltration into the collection system is creating non-compliance with the provincial permit requirements, and staff say this could trigger additional actions to be taken. Staff proposed to continue the work, but defer funding for the infiltration reduction phase 2 project by $5,000 to next year’s budget process.
Rosenboom said staff will communicate with the impacted service users before utility bills are sent out in April.
The changes to the sewage treatment facilities service unit bylaw had to be approved before the SCRD could adopt the final 2022-2026 financial plan. Both were adopted at the Feb. 24 board meeting.