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Room 400 - 330 Portage Avenue
Winnipeg, MB R3C 0C4
www.pub.gov.mb.ca
330, avenue Portage, pièce 400
Winnipeg (Manitoba) Canada R3C 0C4
www.pub.gov.mb.ca
Order No. 50/20
RURAL MUNICIPALITY OF ALEXANDER
GREAT FALLS WATER AND WASTEWATER UTILITY
FINAL WATER RATES
April 3, 2020
BEFORE:
Irene A. Hamilton, Q.C., Panel Chair
Mike Watson, Panel Member
Order No. 50/20
April 3, 2020
Page 2 of 14
Table of Contents
1.0
Executive Summary .............................................................................................. 3
2.0
Background .......................................................................................................... 3
Water Supply/Distribution ..................................................................................... 4
Wastewater Collection/Treatment ......................................................................... 4
Unaccounted for Water ......................................................................................... 5
3.0
Application ............................................................................................................ 5
Working Capital Surplus/Deficit ............................................................................ 6
Contingency Allowance and Utility Reserves ........................................................ 7
Cost Allocation Methodology ................................................................................ 7
4.0
Board Findings...................................................................................................... 8
5.0
IT IS THEREFORE ORDERED THAT: ................................................................. 8
SCHEDULE A ..................................................................................................... 10
Order No. 50/20
April 3, 2020
Page 3 of 14
1.0
Executive Summary
By this Order, the Public Utilities Board (Board) approves as final the water and
wastewater rates as applied for by the Rural Municipality of Alexander (RM), Great Falls
Water and Wastewater (Utility). Board Order No. 175/19 previously established these
rates on an interim ex parte basis.
The approved rates are as follows:
Current
Rates
January 1,
2020
Quarterly Service Charge
$15.00
$15.00
Water (per 1,000 gallons)
$14.00
$31.40
Wastewater (per 1,000 gallons)
$10.65
$10.65
Minimum Quarterly Charge*
$88.95
$141.15
Bulk Sales Rate
$13.75
$31.40**
Hydrant Rental Charge
$100.00
$100.00
*Based on 3,000 gallons
**For any quantity of 500 gallons or less the minimum charge will be $15.70
Details of other rates may be found in the attached Schedule A.
Rationale for the Board's decisions may be found under the Board Findings section
below.
2.0
Background
Until recently, Manitoba Hydro owned and operated a water treatment plant in the RM
and supplied treated water to the Utility at no charge. A new water treatment plant was
recently constructed at a cost of $5,350,000. The Utility assumed operation of the new
water treatment plant and began distribution on July 1, 2019.
Manitoba Hydro plans to continue use of the existing water treatment plant pumping
equipment, which supplies untreated water for fire hydrants in the community. The rate
study notes, any costs associated with decommissioning the water treatment components
of the plant will be borne by Manitoba Hydro.
Order No. 50/20
April 3, 2020
Page 4 of 14
The new water treatment plant and wastewater collection system are owned and operated
by the RM servicing 92 customers. The new water treatment plant will now require water
purification and treatment costs as Manitoba Hydro no longer supplies treated water at
no charge.
Water Supply/Distribution
The water treatment plant was commissioned in in late 2019, replacing the water
treatment plant owned and operated by Manitoba Hydro. The new plant uses fresh water
from the Winnipeg River and operates both ultra-filtration and nano-filtration membrane
systems, along with chlorine disinfectant to clean, disinfect, and store water for
distribution. The plant is rated for production of up to 8L/s.
The water distribution system consists of approximately 25km of water mains delivering
water to properties from Great Falls to Winnipeg River Drive. Approximately 50% of the
water mains are made of high-density polyethylene (HDPE) and are approximately 30
years of age and in good condition. The remainder of the water mains are either cast iron
or concrete. The water mains are approximately 50 years of age and in poor to good
condition.
Wastewater Collection/Treatment
The wastewater collection system operates on a gravity basis consisting of approximately
25km of sewer mains and a lift station collection point. The lift station utilizes two 10hp
electric pumps to discharge wastewater to the town wastewater lagoon, approximately
3km north of the town. Approximately 50% of the collection system made of is either
polyvinyl chloride (PVC) or HDPE pipe and is about 30 years of age and in good condition.
The remainder of the collection system is concrete asbestos pipe and is approximately
50 years of age and in poor to good condition.
The lagoon operates a two-cell (primary & secondary) system and is discharged annually
according to license requirements. The RM advises the lagoon is functioning well at this
time and is considered in good condition.
Order No. 50/20
April 3, 2020
Page 5 of 14
The Town of Great Falls also operates about 5km of storm sewer (land drainage) which
is connected to the wastewater lift station. Fire hydrants in Great Falls are supplied with
water from Manitoba Hydro using non-potable water from the old water supply plant.
Unaccounted for Water
Manitoba Hydro previously provided treated water at no cost. The RM does not have any
record of the unaccounted for water from that water treatment plant and does not have
data for the new plant to date.
3.0
Application
On October 18, 2019, the RM applied for initial interim ex parte water and wastewater
rates for the Utility. The application was accompanied by a rate study prepared by the
RM's consultant and by-Law 05/19 having had first reading October 8, 2019.
On November 29, 2019, the Board approved interim ex parte water and wastewater rates
as applied for by the RM in Board Order No. 175/19. The RM's Utility rates were last
approved in Board Order No. 60/15, with the last rate increase occurring January 1, 2014.
A Public Notice of Application was issued on December 4, 2019 allowing for any questions
or comments with respect to the proposed rate increases to the Board and/or the RM on
or before January 3, 2019. The Board received one response.
Order No. 50/20
April 3, 2020
Page 6 of 14
When reviewing an application, the Board can either: hold a public hearing at which the
applicant can present its case and customers can present their concerns; or where it is
deemed to be in the best interests of a utility and its customers, the Board car review the
application using a paper review process without holding a public hearing. The paper
review process considers all written materials submitted by the Utility and the Public, as
well as any information requests and responses between the Board and the Utility.
Whenever reasonable, the Board will review the application using a paper review process
which saves the cost of a public hearing process.
The Board has chosen a paper review process for the RM's application.
The water rates were calculated based on the following projections:
2020
Water Expenses
Purification and Treatment
$34,053
Connection Costs
322
Transmission and Distribution
7,736
Amortization
133,750
Interest on Long-Term Debt
12,600
Contingency
3,831
Total Water Expenses $192,292
Water Revenue
Hydrant Rentals
$800
Bulk Water Fees
3,000
Property Taxes - Debt Payments
28,331
Total Water Revenue
$32,131
Net Costs Water $160,161
The RM is not requesting any increases to the existing quarterly service charge nor the
existing wastewater rates.
Working Capital Surplus/Deficit
Board Order No. 93/09 established that utilities should maintain a minimum working
capital surplus, in an amount equal to 20% of annual expenses. The working capital
surplus/deficit is defined as the Utility fund balance, excluding any capital related items
plus Utility reserves.
Order No. 50/20
April 3, 2020
Page 7 of 14
As per the 2018 Audited Financial Statements, the most recent information available, the
working capital surplus for the Utility as at December 31, 2018 was:
2018
Fund Surplus/(Deficit)
$3,219,925
Deduct: Tangible Capital Assets
(3,890,229)
Add: Long-Term Debt
-
Add: Utility Reserve
61,567
Working Capital Surplus/(Deficit)
$(608,737)
Total Operating Expenses
$41,647
20% of Operating Expenses
$8,329
The Utility does not meet the Board's target of 20% of operating expenses.
Contingency Allowance and Utility Reserves
As per the Board's Water Rate Application Guidelines, a yearly allowance equal to 10%
of the variable operating costs is recommended for a contingency allowance.
The RM has included a contingency allowance of $3,831 for water.
The RM is not requesting a reserve allowance.
Cost Allocation Methodology
The Board requires all municipal governments to review the costs shared between its
general operations and the Utility, and to allocate appropriate and reasonable costs to the
Utility, based on a policy known as a Cost Allocation Methodology. This allocation must
be submitted to the Board for approval and cannot be changed without receiving approval
from the Board. The Board's requirements regarding the cost allocation methodologies
can be found in Board Order No. 93/09.
The RM is not requesting any changes to its existing Cost Allocation Methodology.
Order No. 50/20
April 3, 2020
Page 8 of 14
4.0
Board Findings
The Board has reviewed the rate application and the projections presented by the RM
and finds them to be reasonable. The Board grants approval for the water rates as applied
for effective January 1, 2020.
The Board notes the RM is not requesting any changes to the existing Cost Allocation
Methodology and reminds the RM this methodology must be used consistently. Any
changes to the cost allocation methodology require Board approval prior to its
enforcement.
The Board requires the RM to review its water and wastewater rates for the Utility for
adequacy and file a report with the Public Utilities Board, as well as an application for
revised rates on or before December 31, 2020.
The Board directs the RM to monitor the new water treatment plant performance and if
the RM becomes aware the rates approved in this Order are inadequate to cover the
operating costs of the Utility, the Board encourages the RM to submit a revised Rate
Application as soon as possible.
5.0
IT IS THEREFORE ORDERED THAT:
1.
The water and wastewater rates for the Rural Municipality Alexander, Great Falls
Water and Wastewater Utility, as approved on an interim ex parte basis in Board
Order No. 175/19, BE AND ARE HEREBY CONFIRMED AS FINAL in accordance
with the attached Schedule A, effective January 1, 2020.
2.
The Rural Municipality of Alexander amend its water and wastewater By-Law for the
Great Falls Water and Wastewater Utility to reflect the decisions in this Order and
file a copy with the Public Utilities Board, as soon as it has received third and final
reading.
Order No. 50/20
April 3, 2020
Page 9 of 14
3.
The Rural Municipality of Alexander provide a notice to its customers, including the
decisions in this Order and submit a copy to the Public Utilities Board.
4.
The Rural Municipality of Alexander review its water and wastewater rates for
adequacy and file a report with the Public Utilities Board, as well as an application
for revised rates if required, by no later than December 31, 2020.
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.
Fees payable upon this Order - $500.00
THE PUBLIC UTILITIES BOARD
"Irene Hamilton, Q.C"
Panel Chair
"Frederick Mykytyshyn"
Assistant Associate Secretary
Certified a true copy of Order No. 50/20 issued
by The Public Utilities Board
__
Assistant Associate Secretary
Order No. 50/20
April 3, 2020
Page 10 of 14
SCHEDULE A
RURAL MUNICIPALITY OF ALEXANDER
GREAT FALLS WATER AND WASTEWATER UTILITY
WATER & WASTEWATER UTILITY RATES BY-LAW NO. 05/19
SCHEDULE OF QUARTERLY RATES
1. Schedule of Commodity Rates &
January 1, 2020
Quarterly Service Charge
Rates per 1,000 Gallons
1,000 Gallons per quarter
Water
Wastewater Water & Wastewater
$31.40
10.65
$42.05
Quarterly Service Charge
$15.00
2. Minimum Charges per Quarter
Notwithstanding the rates set forth in paragraph 1, all customers will pay the
applicable minimum charges per quarter set out below, which includes the water
allowance as listed.
a) Water & Wastewater Customers
Water
Customer
Water
Wastewater Water & Wastewater
Included
Service
Commodity
Commodity
Total Quarterly
Meter Size
(Gallons)
Charge
Charge
Charge
Minimum
5/8 inch 3,000
$15.00
$94.20
$31.95
$141.15
¾ inch 6,000
$15.00
$188.40
$63.90
$267.30
1 inch 12,000
$15.00
$376.80
$127.80
$519.60
b) Water Only Customers
The minimum charge will be the same for each meter size as shown above, but the
Wastewater Commodity Charge will be excluded.
c) Wastewater Only Customers
The minimum charge will be the same for each meter size as shown above, but the
Water Commodity Charge will be excluded.
Order No. 50/20
April 3, 2020
Page 11 of 14
3. Bulk Water Sales
All water sold in bulk by the Great Falls Water and Wastewater Utility shall be
charged for at the rate of $31.40 per 1,000 gallons on a prorated basis for all
quantities greater 500 gallons. For any quantity of 500 gallons or less the minimum
charge will be $15.70.
The following clauses take effect January 1, 2020:
4. Service to Customers Outside Utility's Limits
a) The Council of the Rural Municipality of Alexander may sign Agreements with
customers for the provision of water and wastewater services to properties
located outside the legal boundaries of the Unincorporated Community of Great
Falls. Such agreements shall provide for payment of the appropriate rates set
out in the schedule, as well as a surcharge set by resolution of Council, which
shall be equivalent to the frontage levy, general taxes and special taxes for
Utility purposes in effect at the time, or may be in effect from time-to time, and
which would be levied on the property concerned if it were within these
boundaries.
b) All costs of connecting to the Utility's mains, and installing and maintaining
service connections, will be paid by the customer.
5. Billings And Penalties
Accounts shall be billed quarterly and shall be due and payable the last working
day of the month following the month in which the bills are issued. A late payment
penalty charge of 1.25% compounded monthly shall be charged on the dollar
amount owing after the billing due date.
Order No. 50/20
April 3, 2020
Page 12 of 14
6. Disconnection
a) The Public Utilities Board has approved the Conditions Precedent to be
followed by the Rural Municipality with respect to 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 Rural Municipality's office.
b) Service may be disconnected upon request of the property owner following a
payment of $50.00 for said disconnection service.
7. Reconnection
Any service disconnected de to non-payment of account shall not be reconnected
until all arrears, penalties and a reconnection fee of $50.00 have been paid.
8. Outstanding Bills
Pursuant to Section 252(2) of The Municipal Act, the amount of all outstanding
charges for water and wastewater services, including fines and penalties, are a
lien and charge upon the land serviced, and may be collected in the same manner
in which ordinary taxes upon the land are collectible, and with like remedies.
9. Hydrant Charges
The Unincorporated Community of Great Falls will pay to the Utility an annual
rental fee of $100.00 for each hydrant connected to the system.
10. Water Allowance Due to Line Freezing
The in any case where, at the request of the Rural Municipality, 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 off the occupant has changed.
Order No. 50/20
April 3, 2020
Page 13 of 14
11. Wastewater Surcharges
a) There may be levied annually, in addition to the rates set forth above, a special
surcharge on sewage having a Biochemical Oxygen Demand in excess of 300
parts per million, to b 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 waste.
12. Water Meters
a) All customers of the Utility, connected to the Water Utility, shall be metered.
b) Any new residential customer shall be required to have the meter installed by
a qualified plumber certified by the Province of Manitoba, at their sole cost. The
certified plumber shall be responsible to:
c) Install the meter plus the appropriate Meter Reading mechanism as provided
by the Utility; and
d) Ensure that the installation is inspected by the Utility's representative and
secured in such a manner as established by the Utility
e) Ownership, inspection and maintenance of meters shall remain the
responsibility of the Utility System. Commercial meter maintenance will be the
responsibility of the Utility System, but will be billed to the Commercial User.
f) Upon inspection, if it is found that the security mechanism has been altered in
any manner, the owner of the property shall be assessed a fee of $100.00 to
ensure an accurate reading, inside meter and outside reader plus re-securing
the meter.
Order No. 50/20
April 3, 2020
Page 14 of 14
13. Meter Testing Charges
a) Any consumer desiring and requesting that a meter be tested for accuracy shall
deposit with the Rural Municipality of Alexander the sum of $25.00 which shall
be retained by the Rural Municipality if the meter, when tested, is found to
register within the allowable limits of variation from accuracy. If the meter shall
be found to register in excess of allowable limits the deposit shall be refunded
and the consumer's account adjusted.
b) The allowable limit of variation shall be 4% of average flow.