The City of Parksville and Regional District of Nanaimo still don’t know how much federal funding they’ll get, if any, for a $40-million water-treatment plant and aquifer storage and recovery project that’s supposed to be up and running by December 2016. And the clock is ticking. In six months the city and region have to ask taxpayers to approve borrowing millions for the project and, if the city and region are to meet federal and healthauthority deadlines, there’s less than year left before they’re supposed to award tenders.
City staff can’t submit an application to the federal Gas Tax Fund and Building Canada fund, said Mayor Chris Burger. “(Senior) governments haven’t signed the agreement yet on the fund.”
Infrastructure Canada spokesperson Robin Strong said the department is in the process of finalizing the agreements for the renewed federal Gas Tax Fund.
In B.C., the Union of B.C. Municipalities administers the fund on behalf of the province.
“Specific allocations to municipalities will be determined through the federal-provincialterritorial GTF agreements,” Strong explained. “The renewed agreements were sent to the provinces and territories on Nov. 5, 2013, and we are working closely with the provinces and territories to finalize these agreements as quickly as possible.”
The new treatment plant, intake and ASR are now estimated to cost $40 million, a decrease of $2.5 million from previous estimates. Parksville will pay 74 per cent ($29.6 million) and the Regional District of Nanaimo (Nanoose Bay) 26 per cent ($10.4 million).
Council voted to increase water rates and development cost charges based on the assumption the city will get $8 million in grants and will have to borrow $9.85 million, a debt the city plans to repay over 25 years.
If the city doesn’t get grants, said ERWS program manager Mike Squire, it will have to borrow $18 million, requiring annual debtservicing of $1,269,000. Borrowing will have to be approved during a referendum to be held in conjunction with the municipal elections in November.
Burger said the city has $6 million in reserve to pay for the project.
“Revenues, such as DCCs (developmentcost charges), will make up the difference,” he said.
RDN water manager Mike Donnelly said the RDN’s share of the project would be paid through property taxes, DCCs and federal grants.
The ERWS board is to report on the feasibility of ASR in a public meeting this Friday, May 16, but without grants and design details, it will be hard to know how much will be needed for the whole ERWS project.
“We have our work cut out between now and the borrowing referendum in November,” Burger said.
DCCs will contribute $14 million to the project over the next 25 years, Squire said. However, because the municipality doesn’t have the DCC money in reserve, it has to borrow money to pay for the project.
“[The estimated project cost] is a big hit. We can’t pay that upfront,” Squire said. “We have to lessen the burden by stretching it.”
Costs can be worked on as the design details evolve, he said.
“We’ll always have options [to decrease the costs],” he said. “Between now and [the end of the year], we’ll be focusing on costs.”