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Room 400 - 330 Portage Avenue
Winnipeg, MB R3C 0C4
www.pubmanitoba.ca
330, avenue Portage, pièce 400
Winnipeg (Manitoba) Canada R3C 0C4
www.pubmanitoba.ca
Order No. 10/25
LOCAL GOVERNMENT DISTRICT OF PINAWA
PINAWA WATER AND WASTEWATER UTILITY
REVISED WATER AND WASTEWATER RATES
EFFECTIVE APRIL 1, 2025, 2026 AND 2027
January 22, 2025
BEFORE: Marilyn Kapitany, B.Sc. (Hon), M. Sc., Panel Chair
Shawn McCutcheon, Panel Member
Kim Sharman, Panel Member
Order No. 10/25
January 22, 2025
Page 2 of 16
Table of Contents
1.0
Executive Summary ............................................................................................ 4
2.0
Background ......................................................................................................... 5
Water Supply/Distribution ..................................................................................... 5
Wastewater Collection and Treatment .................................................................. 5
3.0
Board Methodology ............................................................................................. 6
Review Process .................................................................................................... 6
Contingency Allowance and Utility Reserves ........................................................ 6
Working Capital .................................................................................................... 6
Operating Deficits ................................................................................................. 6
Cost Allocation Methodology ................................................................................ 7
Unaccounted for Water ......................................................................................... 7
4.0
Application ........................................................................................................... 8
Contingency Allowance and Utility Reserves ........................................................ 9
Working Capital .................................................................................................. 10
Operating Deficits ............................................................................................... 10
Cost Allocation Methodology .............................................................................. 11
Unaccounted for Water ....................................................................................... 11
5.0
Board Findings .................................................................................................. 11
Order No. 10/25
January 22, 2025
Page 3 of 16
6.0
IT IS THEREFORE ORDERED THAT: ............................................................... 13
SCHEDULE "A" ........................................................................................................... 15
Order No. 10/25
January 22, 2025
Page 4 of 16
1.0
Executive Summary
By this Order, the Manitoba Public Utilities Board (Board) grants approval of the Local
Government District of Pinawa (LGD), Pinawa Utility's (Utility) application for revised
water and wastewater rates.
The revised rates are below:
Apr 1, 2025 Apr 1, 2026 Apr 1, 2027
Quarterly Service Charge
23.35
$
24.55
$
25.85
$
Water (per cubic meter)
5.40
$
5.60
$
5.80
$
Wastewater (per cubic meter)
0.70
$
0.70
$
0.70
$
Minimum Quarterly Charge*
108.75
$
112.75
$
116.85
$
Lagoon Tipping Fees (per load)
25.00
$
25.00
$
25.00
$
Bulk Water Sales (per cubic meter)
5.40
$
5.60
$
5.80
$
Reconnection Fee
75.00
$
75.00
$
75.00
$
Curb Stop Turn On/Off Charge (per event)
75.00
$
75.00
$
75.00
$
Deficit Recovery
Rate Rider (per cubic meter)
1.13
$
1.13
$
1.13
$
*based on 14m3
Details of other rates can be found in Schedule A.
The reasons for the Board's decisions are under Board Findings.
Order No. 10/25
January 22, 2025
Page 5 of 16
2.0
Background
Rates were last set in Board Order No. 142/19, with current rates coming into effect
January 1, 2021.
The Utility provides water and wastewater service to approximately 727 customers. The
LGD advises 688 of its customers are residential and 39 are commercial.
Water Supply/Distribution
The water treatment plant was constructed in 1963 and upgraded in 1988 and 2005. The
Utility draws raw water from the Winnipeg River. Water treatment includes filtration and
chlorination.
The water distribution system consists of a combination of asbestos cement pipe; plastic
pipe and ductile iron pipe. Parts of the distribution system are approximately 50 years
old and have been and are being replaced as the need arises.
The LGD has installed a bulk water station partially paid for by the Utility. The new bulk
water customers are seasonal residents of a local trailer park and the owner of the park
advised residents a piped water distribution system would no longer be provided. The
LGD installed the bulk water station to serve these customers.
Wastewater Collection and Treatment
Wastewater treatment is handled by a five cell lagoon, which was completed in 2016.
The lagoon discharges into the Winnipeg River by a drainage ditch. The lagoon is
expected to meet the future needs of the Utility for the next 20 or so years.
The wastewater collection system consists of plastic, polyvinyl chloride and clay pipe.
Order No. 10/25
January 22, 2025
Page 6 of 16
3.0
Board Methodology
Review Process
When reviewing an application, the Board has at its disposal two approaches, a paper
review process or a public hearing. After the publication of the Notice of Application, the
Board considers the application and responses, if any, and determines which method of
review is most appropriate. Whenever reasonable, the Board can review the application
using a paper review process, which saves the cost of a public hearing.
Where there is an urgent need for initial or revised rates and the Board determines it to
be in the best interest of all parties, the Board may establish interim ex parte rates.
Contingency Allowance and Utility Reserves
The Board's Water and Wastewater Rate Application Guidelines recommend an annual
contingency allowance equal to 10% of the variable operating costs.
Working Capital
Board Order No. 93/09 established utilities should maintain a minimum working capital
surplus, in an amount equal to 20% of annual expenses. The working capital surplus is
the Utility fund balance, excluding any capital-related items plus Utility reserves.
The working capital calculation was revised in Board Order No. 5/25 to reflect the changes
to Public Sector Accounting Board Standards in the treatment of asset retirement
obligations (AROs).
Operating Deficits
By law, Manitoba utilities are not allowed to incur deficits. In the event that a deficit does
occur, the Utility is required by The Municipal Act to obtain Board approval for both the
deficit and recovery methodology. The Board is therefore bound to approve reasonable
rates based on reasonable expense projections.
Order No. 10/25
January 22, 2025
Page 7 of 16
Cost Allocation Methodology
The Board requires all municipalities to review the costs shared between the general
operations of the LGD and the Utility, and to allocate appropriate and reasonable costs
to the Utility, based on a policy known as a Cost Allocation Methodology. This policy
must be submitted to the Board for approval and cannot be changed without approval by
the Board. The Board's requirements regarding cost allocation methodologies can be
found in Board Order No. 93/09.
Unaccounted for Water
Water losses may be caused by such events as distribution line losses, service leaks,
water used for fire fighting or line flushing, and under-registration of water meters. The
Board Guidelines require utilities to compare the volume of water produced or purchased
against the volume of water sold, to determine the percentage of unaccounted for water.
Unaccounted for water volumes of approximately 10% are considered industry standard.
The Board expects any utility experiencing a greater volume of unaccounted for water to
provide an explanation and plan to address the water losses.
Order No. 10/25
January 22, 2025
Page 8 of 16
4.0
Application
On November 23, 2023, the Board received the LGD's application to revise water and
wastewater rates as set out in By-Law No. 918-2023, having had first reading September
12, 2023. The application was accompanied by a rate study completed by the LGD's
consultant.
The Board issued a Public Notice of Application on November 28, 2023 affording
customers the opportunity to comment to both the Board and the LGD with respect to the
proposed rate changes. The Board received one response to the Notice.
The rates were calculated using the following revenue requirement projections:
General
Year 1
Year 2
Year 3
Administration (building, office, staff, etc)
18,375
19,294
20,258
Total general expenses
18,375
19,294
20,258
Penalties
3,000
3,000
3,000
Total general revenue
3,000
3,000
3,000
Net revenue requirement - general
15,375
16,294
17,258
Water
Purification and treatment
251,772
264,361
277,579
Debenture surcharge
75,044
75,044
75,044
Service of supply
64,885
68,129
71,536
Transmission and distribution
72,975
76,624
80,455
Other water supply costs
52,500
55,125
57,881
Equity surcharge
6,400
6,720
7,056
Amortization
166,612
166,612
166,612
Interest on long term debt
0
0
0
Reserves
50,000
50,000
50,000
Minor capital upgrades
40,000
42,000
44,100
Contingency
22,660
23,730
24,917
Total water expenses
802,848
828,345
855,180
Order No. 10/25
January 22, 2025
Page 9 of 16
Hydrant rentals
15,000
15,000
15,000
Amortization of capital grants
96,626
96,626
96,626
Principle of debenture
59,663
61,448
63,388
Bulk water revenue
8,000
8,000
8,000
Other revenue
1,500
1,500
1,500
Total water revenue
180,789
182,574
184,514
Net revenue requirement - water
622,059
645,771
670,665
Wastewater
Wastewater collection system
25,305
26,570
27,899
Wastewater treatment and disposal
6,195
6,505
6,830
Lift station costs
19,005
19,955
20,953
Equity surcharge
1,600
1,680
1,764
Amortization
42,416
42,416
42,416
Interest on long term debt
27,103
25,352
23,530
Reserves
2,000
2,000
2,000
Minor capital upgrades
20,000
21,000
22,050
Contingency
5,665
5,665
5,665
Total wastewater expenses
149,289
151,143
153,106
Lagoon tipping fees
6,031
6,031
6,031
Amortization of capital grants
671
671
671
Taxation revenues
70,259
70,259
70,259
Total wastewater revenue
76,961
76,961
76,961
Net revenue requirement - wastewater
72,328
74,182
76,145
The LGD submitted that in its July 2018 rate review, it reported that other administration
costs flowing from its shared cost allocation study were reflected as "Other Water Supply
Costs" on the audited financial statements. The LGD submitted then, and now, these
expenses are more appropriately recovered in the quarterly service charge. In the 2018
review, the Board approved this and the LGD has handled this allocation in the same
manner, by deducting these costs from the revenue requirement for water and adding
them to the revenue requirement for general.
Contingency Allowance and Utility Reserves
The LGD has included in its projections a contingency allowance of 10% of variable
operating costs, as shown in the table above. There is also a provision for transfer to
Utility Reserve in the amount of $50,000 per year for water and $2,000 per year for
wastewater.
Order No. 10/25
January 22, 2025
Page 10 of 16
Working Capital
As per the 2023 audited financial statements, the working capital surplus at December
31, 2023 was:
2023
Accumulated Fund Surplus/Deficit
$3,630,835
Deduct tangible capital assets
$4,724,106
Add utility asset retirement obligation
$0
Add utility long term debt
$1,083,389
Add utility reserves
$84,318
Equals Working Capital Surplus/Deficit
$74,436
Utility expenses
$721,283
20% of utility expenses (target)
$144,257
The LGD has included in its revenue requirements an equity surcharge to assist in
rebuilding the Working Capital to meet the Board's target. This surcharge is $7,056 for
water and $1,764 for wastewater (Year 3).
Operating Deficits
The LGD experienced operating deficits in all years from 2013 to 2018, totalling $746,494.
These deficits have been approved by the Board in multiple Board Orders. Deficits from
2013 to 2015 were originally approved in Board Order No. 160/18, and the 2016 and 2017
deficits were approved in Board Order No. 142/19.
In November 2019 the LGD applied to the Board for approval of the 2018 deficit and
included a request to extend the existing rate rider of $0.83 per cubic meter for a period
of six months. In Board Order No. 23/20, the Board found the LGD's proposed recovery
was inadequate and denied it, approving a deficit rate rider of $1.13 per cubic meter
instead.
Order No. 10/25
January 22, 2025
Page 11 of 16
As of December 31, 2023 the LGD has recovered $561,021 of the $746,494 in deficits.
The LGD states its annual consumption has continued to decline and in 2022 the total
sales volume was approximately 106,000 cubic meters.
The LGD's application projected the time needed to complete the recovery of the deficits
and requested the Board approve an extension from March 31, 2025 to June 30, 2025.
Cost Allocation Methodology
The Board granted approval of the Utility's current Cost Allocation Methodology (CAM) in
Board Order No. 142/19. The LGD did not propose any changes to the existing CAM.
Unaccounted for Water
The Utility indicated the 2022 unaccounted for water was 3.2% of water produced, well
within Board guidelines. The LGD's application noted the previous rate review included
a three year average level of unaccounted for water at 34%; the Board commends the
LGD for its diligence in investigating and making necessary water main renewals to
achieve these improvements.
5.0
Board Findings
Considering the LGD's filing and noting there was one public response to the Notice of
Application, the Board has chosen a paper review process. The Board notes the LGD
did not respond to the ratepayer, and recommends the Utility contact the ratepayer
directly to address the concerns shared.
The Board has reviewed the application and revenue projections presented by the LGD
and finds the projections to be reasonable. The Board grants approval of the revised
rates for the LGD, effective April 1, 2025, 2026 and 2027.
Order No. 10/25
January 22, 2025
Page 12 of 16
The Board grants approval of the LGD's request to extend the deficit rate rider to June
30, 2025. The Board directs the LGD to provide a report with the final accounting of the
rate rider and confirm its conclusion June 30, 2025. This report is due on or before July
31, 2025.
The Board requires the LGD to review its water and wastewater rates for adequacy and
file a report with the Public Utilities Board, as well as a full rate application for revised
rates if required, by no later than March 31, 2028.
The Board directs the LGD to prepare a Notice for its ratepayers, informing them of the
decisions in this Order. The LGD is directed to provide the Board a copy of this Notice
and an amended rate By-law, having had third reading.
The Board grants approval of the LGD's reallocation of expenses labelled "Other Water
Supply Costs" on the audited financial statements from water to general revenue
requirements. The Board expects the LGD to work with its auditors to ensure the audited
financial statements are prepared in a way that aligns with the rate setting methodology.
The Board reminds the LGD regular reviews are important for a financially sound utility
and encourages the LGD to review Board Order Nos. 27/23 and 86/17 for future rate
applications. The Order outlines the Simplified Rate Application Process for municipally
owned public utilities. If, after its rate review, the LGD finds it meets the designated
criteria for a simplified rate application, it should apply for future rates using the Simplified
Rate Application Process.
Order No. 10/25
January 22, 2025
Page 13 of 16
6.0
IT IS THEREFORE ORDERED THAT:
1. The water and wastewater rates for the Local Government District of Pinawa -
Pinawa Water and Wastewater Utility, BE AND ARE HEREBY APPROVED in
accordance with the attached Schedule A, effective April 1, 2025, 2026 and 2027.
2. The requested extension to June 30, 2025 of the deficit rate rider in the amount of
$1.13 per m3 for the Local Government District of Pinawa - Pinawa Water and
Wastewater Utility, BE AND IS HEREBY APPROVED.
3. The Local Government District of Pinawa - Pinawa Water and Wastewater Utility
will provide a final accounting of the rate rider collection, as well as confirmation of
its conclusion June 30, 2025, on or before July 31, 2025.
4. The Local Government District of Pinawa amend its Pinawa Utility Water and
Wastewater Utility rate By-law to reflect the decisions in this Order and submit a
copy to the Public Utilities Board once it has received third and final reading.
5. The Local Government District of Pinawa is to provide a notice of the decisions
found in this Order to its Pinawa Water and Wastewater Utility customers as soon
as possible, with a copy provided to the Public Utilities Board.
6. The Local Government District of Pinawa review the Pinawa Utility rates for
adequacy and file a report with the Public Utilities Board, as well as an application
for revised rates (if applicable), on or before March 31, 2028.
Order No. 10/25
January 22, 2025
Page 14 of 16
Fees payable upon this Order - $500.00
Board decisions may be appealed in accordance with the provisions of Section 58 of The
Public Utilities Board Act, or reviewed in accordance with Section 36 of the Board's Rules
of Practice and Procedure. The Board's Rules may be viewed on the Board's website at
www.pubmanitoba.ca.
THE PUBLIC UTILITIES BOARD
"Marilyn Kapitany, B.Sc. (Hon), M. Sc."
Panel Chair
"Jennifer Dubois, CPA, CMA, CTAJ"
Assistant Associate Secretary
Certified a true copy of Order No. 10/25
issued by The Public Utilities Board
________
Assistant Associate Secretary
Order No. 10/25
January 22, 2025
Page 15 of 16
SCHEDULE "A"
THE LOCAL GOVERNMENT DISTRICT OF PINAWA
WATER AND SEWER RATES
BY-LAW NO. 918-2023
SCHEDULE OF QUARTERLY RATES:
1.
Commodity rates per m3
Water
Sewer
Water & Sewer
All water consumption
April 1, 2025
$5.40
$0.70
$6.10
April 1, 2026
$5.60
$0.70
$6.30
April 1, 2027
$5.80
$0.70
$6.50
2.
Minimum Charges, Quarterly
Notwithstanding the Commodity rates set forth in paragraph 1 hereof, all customers will
pay the applicable minimum charges set out below, which will include water allowances
as well as the customer service charge indicated:
(a) Water and Sewer Customers
Water
Customer
Commodity Charges
Total
Included
Service
Quarterly
m3
Charge
Water Sewer
Minimum
April 1, 2025 14.00
$23.35
$5.40 $0.70
$108.75
April 1, 2026 14.00
$24.55
$5.60 $0.70
$112.75
April 1, 2027 14.00
$25.85
$5.80 $0.70
$116.85
3.
Billings and Penalties
Accounts shall be billed quarterly and shall be due and payable 30 days after date of billing.
A late payment charge of 1 ¼% per month shall be charged on the dollar amount owing after
the billing due date.
4.
Disconnection
The Public Utilities Board has approved the Conditions Precedent to be followed by the
municipality with respect to the disconnection of service for non-payment including such
matters as notice and the right to appeal such action to the Public Utilities Board. A copy of
the Conditions Precedent is available for inspection at the Municipal Office.
Service may be disconnected and discontinued immediately and without further notice in the
event of non-payment of the account within 30 days after due date.
5.
Reconnection
Any service disconnected due to non-payment of account shall not be reconnected until all
arrears, penalties and a reconnection fee of $75 have been paid.
Order No. 10/25
January 22, 2025
Page 16 of 16
6.
Outstanding Bills
Pursuant to Section 252(2) of The Municipal Act, the amount of all outstanding charges for
water and sewer service are a lien and charge upon the land serviced and shall be collected
in the same manner in which ordinary taxes upon the land are collectible, and with like
remedies.
7.
Bulk Water Sales Rate
All water sold in bulk by the Local Government District of Pinawa shall be charged for as
follows:
April 1, 2025
$5.40/m3
April 1, 2026
$5.60/m3
April 1, 2027
$5.80/m3
8.
Hydrant Rentals
The Local Government District of Pinawa will pay to the utility an annual rental of $100 for
each hydrant connected to the system. In addition, the Local Government District of Pinawa
will pay for water used for fire-fighting.
9.
Curb Stop Turn On/Turn Off
The fee to turn on or turn off the water service at the curb stop shall be $75 for each event.
10.
Lagoon Tipping Fees
Lagoon Tipping Fees shall be $25/per load.
11.
Water Allowance Due to Line Freezing
That in any case where, at the request of Council, a customer allows water to run continuously
for any period of time to prevent the water lines in the water system from freezing, the charge
to that customer for the current quarter shall be the average of the billings for the last two
previous quarters to the same customer, or to the same premises if the occupant has
changed. In all other instances, the Frozen Water Line Policy will be followed.
12.
Sewage Surcharges
(a)
There may be levied annually, in addition to rates set forth above, a special surcharge
on sewage having a Biochemical Oxygen Demand in excess of 300 parts per million, to be
set by resolution of Council.
(b)
A special surcharge for substances requiring special treatment shall be charged
based on the actual costs of treatment required for the particular sewage or industrial wastes.