WATER RATE INCREASE APPLICATION A public meeting was held by the Utility and Review Board on January 15, 2014 in Shelburne to consider a water rate increase for the Town of Shelburne that could potentially increase the water bills by upwards of 71%. The following is a brief history of events that to a large extent has caused the water utility to be in this precarious situation. (1) A request was made on September 3,2009 for approval in the amount of $1,179,098.00 for a water line extension. ( more commonly known as the Mowatt Street water line ) This expansion will service 86 new residential customers and 33 commercial customers. (2) September 10, 2009 the Town advised The Utility and Review Board that funding for this project will come from the Canada/NS infrastructure Secretariat in the amount of $786,066 ( 2/3 of cost ) with the remaining 1/3 Utilitys share in the amount of $393,032 to come from a debenture which will not burden the present customers of the Towns water utility. (3) March 10, 2010 the Town learns the lowest tender is $1,920,746.68 which is $1,000,000.00 ( one million ) over the original projections and this additional cost may place the Towns Utility in an unhealthy financial position. The Town Council votes to proceed with the construction of the Mowatt Street water line extension. (4) March 25, 2010 the Town requests ADDITIONAL funding in the amount of $1,015,046.68 which will be funded through debt financing over a 20 year term. The tenders for the project came in far over budget , costs that are now borne completely by the Town Utility. (5) April 9, 2010 the UARB cautions the water utility with regard to the use of depreciation funds for purposes other than asset replacement, which will have a negative impact on the water utilitys ability to fund future capital projects . (6) when new services are added , the capital costs should be revenue neutral to the existing customers of the utility. (7) the project was launched based on projections that 84 new customers would hook up. Today only 21 new users have been added to the Mowatt Street extension. (8)Former Mayor PG Comeau said a $1-million over run on the project should never have been approved by the provincial review board because there was no supporting evidence that the water line extension would generate the estimate of new customers. Comeau also reasoned that many people in the Town could not afford a large water rate increase. (9) Former Town Clerk Wilmont Hardy questioned the reasoning behind the need for the water line extension suggesting that Councillors wanted to finish a major project before the end of their elected term. He also made reference to the noticeable absence of the Mayor and two Councillors ( who were named ) and also noted that these three were on the previous Council when they knowingly voted to put the water utility in debt to the tune of over one million dollars in excess of the estimated costs that will now take 20 years to retire this expenditure. In other words its going to take 20 years to pay off this debt. Councillor Davis and myself were the only two elected officials from the Town of Shelburne in attendance . We felt it was our responsibility to be present even though this financial nightmare was not of our making but was an inheritance from the previous Council. We also recognize and agree that we must and will continue to be a part of the solution. Respectfully submitted by Councillor Roy ODonnell Like · · 2 minutes ago Write a comment...
Posted on: Fri, 17 Jan 2014 05:54:51 +0000
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