The 2020 Sewer Surcharge budget continues the commitment that the City has made to the very successful Basement Flooding Subsidy Program, with continued robust annual capital funding of $2.6M for this program. The budget also increases the enhanced capital funding commitment by $5 million (to a total of $11M) for work expected to be required as part of the upcoming Sewer Master Plan. An additional increase of $1M is proposed to account for inflationary pressures which continue to erode the purchasing power of the base capital program. These changes bring the total annual capital funding contribution to $37.2M. These significant investments increases in sewer and flooding mitigation related works are important in order to achieve a long-term sustainable funding level to address the major investments that will be forthcoming from the Sewer Master Plan. The Storm Water financing study, which is also currently underway, will provide further or alternative funding options for council to consider going forward to assist in addressing the continued and increasing investments required by the City to mitigate the storm and flooding effects of climate change on a longer term basis.

Taking all the foregoing factors into consideration, the report proposes adjustment in rates, from $2.90 to $2.86 per cubic metre of water used by residential customers, and from $1.20 to $1.42 per cubic metre for commercial customers as well as changes to fixed meter charges.

Background:

The sewer surcharge on the water bill has been in place since January 1, 1994. Until that date, sewer and sewage treatment costs were funded from the property tax levy. The intent of the surcharge is to charge a user fee on the estimated amount of water that is discharged into the sewer system and has to be treated prior to being released back into the environment. The change in methodology from a tax-based charge to the levying of a surcharge is consistent with a user pay model that allows a measure of control over the costs by allowing users to proactively manage water consumption.

This report provides an update on the 2020 sewer surcharge rates and expected revenues based on meter and water consumption projections received from Windsor Utilities Commission (WUC). Additionally, the update takes into account the capital expenditures projected to be required in the coming years due to significant climate change impacts on the sewer system. The Sewer Surcharge budget is updated annually and a 5-year projection is submitted as part of the annual City budget (Appendix A).

Discussion:

City of Windsor Sewer Network Overview

The City's sewer network consists of approximately 1,760 kilometres of the following four types of sewers:

1) Storm Sewers carry storm water runoff only. Storm sewers eventually drain to the Detroit River, untreated. There are approximately 809 kilometres of storm sewers within the City of Windsor (including force mains).