This is the exact embedded text of the captured official document.
Snapshot 1da725dcbd3c · verified 2026-10-18 ·
original document ·
archived snapshot ·
unofficial consolidation, the official version is held by the municipal clerk.
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. 31/21
RURAL MUNICIPALITY OF SIFTON
OAK LAKE WASTEWATER UTILITY
REVISED RATES AND ACTUAL OPERATING DEFICITS
MARCH 8, 2021
BEFORE: Irene Hamilton, Q.C., Panel Chair
Marilyn Kapitany, B.Sc. (Hon), M.Sc., Panel Member
Order No. 31/21
March 8, 2021
Page 2 of 15
Table of Contents
1.0
Executive Summary..................................................................................................... 3
2.0
Background ................................................................................................................. 4
Wastewater Collection/Treatment ............................................................................... 4
3.0
Application ................................................................................................................... 5
Contingency Allowance and Utility Reserves .............................................................. 6
Working Capital Surplus/Deficit .................................................................................. 7
Cost Allocation Methodology ...................................................................................... 7
Deficits ........................................................................................................................ 9
4.0
Board Findings .......................................................................................................... 10
5.0
IT IS HEREBY ORDERED THAT: ............................................................................. 12
SCHEDULE A ........................................................................................................... 14
Order No. 31/21
March 8, 2021
Page 3 of 15
1.0 Executive Summary
By this Order, the Public Utilities Board (Board) approves revised wastewater rates and a
revised Residential Equivalent Unit (REU) schedule for the Rural Municipality of Sifton (RM),
Oak Lake Wastewater Utility (Utility). The Board varies the effective dates to April 1, 2021,
January 1, 2022, and January 1, 2023.
The approved rates and REU schedule are as follows:
Current
REUs
Revised
REUs
April 1,
2021
January
1, 2022
January
1, 2023
Annual Service Charge
-
-
$7.28
$7.43
$7.57
Residential Equivalent Unit Rate (REU)
1.0
1.0
67.06
67.86
68.69
Churches
1.0
0.6
40.23
40.72
41.21
Public School - Fort la Bosse
14.0
8.0
536.44
542.90
549.49
Public Works Shop and Apartment
2.0
4.0
268.22
271.45
274.74
Oak Lake Arena
2.0
4.5
301.75
305.38
309.09
Oak Lake Golf Club
2.0
1.0
67.06
67.86
68.69
Manitoba Housing - Aspen
2.8
2.5
167.64
169.66
171.71
Manitoba Housing - Oakwood
12.00
11.00
737.61
746.49
755.55
Town Hall/RM Office
3.0
3.0
201.17
203.59
206.06
Legion
2.0
1.0
67.06
67.86
68.69
Valley View Coop/Flett Shop
1.5
1.0
67.06
67.86
68.69
Oak Lake Hair Design
1.5
-
Restaurant & Grocery
3.5
-
Oak Lake Meat Market
1.5
-
Oakland Hotel
6.0
-
Valley View Coop (new)
-
2.0
134.11
135.73
137.37
Canada Post & Apt.
-
2.0
134.11
135.73
137.37
Oak Lake Curling Club
-
0.6
40.23
40.72
41.21
Wayne Douglas Plant
-
2.0
134.11
135.73
137.37
Oak Lake-Sifton Fire Dept./Ambulance
-
2.5
167.64
169.66
171.71
Oak Lake & District Museum
-
0.6
40.23
40.72
41.21
Oak Lake Community Hall
-
5.5
368.80
373.24
377.77
Total REU's
54.8
51.8
Order No. 31/21
March 8, 2021
Page 4 of 15
The Board denies the RM's request to recover an actual operating deficit of $30,476 for 2017,
an actual operating deficit of $35,557 for 2018, a forecasted operating deficit of $96,476 for
2019, and a forecasted operating deficit of $95,000 for 2020 to be recovered from future Utility
working capital surplus funds.
Details of other rates may be found in the attached Schedule A.
Rationale for the Board's decisions may be found under the heading Board Findings below.
2.0 Background
The RM owns and operates the Utility serving 206 wastewater customers with a requested,
revised REU assignment of 240 REUs. Rates were last approved for the Utility in 1995 in
Board Order No. 10/95, at that time there were 186 customers and an REU assignment of
226.8 REUs.
One REU is the estimate of the volume of water used by the average single-family residence.
REUs are used in communities with an unmetered distribution and/or collection system, where
information regarding actual consumption is unavailable.
The RM last had a deficit approved in 2018 of $15,639 for 2014, to be recovered by a rate
rider of $15.84 per REU per customer per quarter for five quarters or until the deficit is fully
recovered (whichever comes first), in Board Order No. 129/18.
The RM also had a deficit approved in 2013 of $5,740.06 for 2010 and $3,628.93 for 2011,
to be recovered by a two-year rate rider in Board Order No. 07/13.
Wastewater Collection/Treatment
The gravity-flow system was constructed between 1965 and 1971, consisting of clay pipe. A
low-pressure plastic system was added in 1989 to service a new residential area located
south of the Canadian Pacific Railway tracks. The customers serviced by the low-pressure
system are required to pump out holding tanks at the expense of the Utility. A new lift station
and lagoon was constructed from 2013 to 2014 and began operating in 2015.
Order No. 31/21
March 8, 2021
Page 5 of 15
The wastewater treatment facility is composed of a two-cell lagoon consisting of one primary
treatment cell and one secondary storage cell. The RM advises there is sufficient capacity
to provide for the RM's wastewater treatment and holding requirements. The lagoon
discharges into a drainage ditch that converges with Flat Creek, which then converges with
the Assiniboine River.
3.0 Application
On March 26, 2020, the RM applied for revised wastewater rates, to be effective for 2021,
2022, and 2023 as outlined in By-Law No. 07-2019 having had first reading June 13, 2019.
The application was supported by a rate study prepared by the RM's Chief Administrative
Officer (CAO).
A Public Notice of Application was issued on March 31, 2020 allowing for any questions or
comments with respect to the proposed rate increases to the Board and/or the RM on or
before April 30, 2020. Two responses to the Notice were received from one individual,
primarily with respect to the magnitude of the proposed rate increases and poor service.
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 can 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. This process may
reduce regulatory costs to the Utility.
A public hearing process allows the Utility and the public the opportunity to review the
application and address any concerns with the Board present.
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.
Order No. 31/21
March 8, 2021
Page 6 of 15
The rates were calculated based on the following projections using an annual inflation rate of
2% in all calculations:
Schedule of Utility Rate Requirements - Oak Lake Wastewater Utility
2021 to 2023 Budget Forecasts ($)
2021
2022
2023
Forecast
Operating Costs
Wages
$25,000
$25,500
$26,010
Fuel/Insurance
250
255
260
Machinery/Equipment
1,500
1,530
1,561
Lift Station
4,500
4,590
4,682
Treatment and Disposal
7,500
7,650
7,803
Amortization
95,384
95,384
95,384
Connection
3,000
3,000
3,000
Interest on Debentures
23,275
21,875
20,419
Total Operating Costs
160,409
159,784
159,119
Operating Revenues
Lagoon Tipping Fees
23,500
23,500
23,500
Connection
3,000
3,000
3,000
Other
500
500
500
Amortization of Capital Grants
45,761
45,761
45,761
Taxation
11,737
11,737
11,737
Transfer From Reserves
11,538
10,138
8,682
Total Operating Revenues
96,036
94,636
93,180
Net Revenue Requirements
$64,373
$65,148
$65,939
The proposed Utility rate increases are requested to increase rates to a current level that will
financially sustain the Utility, given rates have not increased/been approved by the Board
since 1995.
Contingency Allowance and Utility Reserves
As per the Board's Water and Wastewater Rate Application Guidelines, a yearly allowance
equal to 10% of the variable operating costs is recommended for a contingency allowance.
The RM has not included a contingency allowance an annual reserve allowance in its
Application.
Order No. 31/21
March 8, 2021
Page 7 of 15
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.
As per the 2018 Audited Financial Statements, the most recent information available, the
working capital deficit for the Utility at December 31, 2018 was:
2018
2017
Utility Fund Surplus/Deficit
$2,395,912
$2,479,230
Deduct: Tangible Capital Assets
4,433,012
4,528,396
Add: Long-Term Debt
-
-
Add: Utility Reserves
15,923
13,681
Equals Working Capital Surplus (Deficit)
$(2,012,077)
$(2,035,485)
Operating Expenses
144,390
138,425
20% of Operating Expenses (Target)
$28,878
$27,685
The Utility does not meet the Board minimum working capital surplus of 20%.
Cost Allocation Methodology
The Board requires all municipal governments to review the costs shared between its general
operations and the Utility, and to allocate appropriate and reasonable costs to the Utility,
based on a policy known as a Cost Allocation Methodology. This allocation must be
submitted to the Board for approval and cannot be changed without receiving approval from
the Board. The Board's requirements regarding cost allocation methodologies can be found
in Board Order No. 93/09.
The RM's allocation plan for shared costs is as follows:
Order No. 31/21
March 8, 2021
Page 8 of 15
Rural Municipality of Sifton
Oak Lake Wastewater Utility
Allocation Plan for Shared Costs
Shared Overhead: Includes all direct and indirect costs related to the administration of the Utility.
Sub-Category
Activity/Expenses (Object)
Expenses Allocated to
Utility
Tracked
Increments
(Actual)/hr
Percentage
(%)
Dollar
Value ($)
Direct
Overhead Cost
Meter Reading - Salaries and
Wages
-
-
-
Billing - Receipting and Collection
7%
$4,000
-
Indirect
Overhead
Costs -
General
Administrative
Costs and
Shared Office
Costs
CAO Salaries and Benefits
1%
$500
-
Council Costs
-
-
-
Audit and Legal
4%
$500
-
Interest Cost on Office Space
-
-
-
Lease Costs
-
-
-
Utilities (i.e. telephone, heat, etc.)
10%
$500
-
Photocopying (etc.)
25%
$500
-
Service Charge
Calculation
Total
$6,000 As per
internal
review 2019
- RM of
Sifton
Total Number of Customers
206
Annual Service Charge/Customer
$29.13
Quarterly Service Charge/Customer
$7.28
Shared Direct Operating Costs: Includes all costs directly attributable to the maintenance and
repair of the utility. Public work employees repair and maintain both transportation and utility
infrastructure. A portion of the cost for the public works department should be allocated to the Utility.
Direct
Equipment
Costs
Public Works Buildings -
Maintenance
-
-
-
Vehicles - Fuel/Insurance
-
$250
-
Machinery and Equipment
-
$1,500
-
Road Construction and Maintenance
Equipment - Interest / Lease Costs /
Amortization
-
-
-
Direct Labour
Labour costs directly attributable to
the maintenance and repair of Utility
Tangible Capital Assets.
$25,000
-
Shared Capital Costs - N/A
Order No. 31/21
March 8, 2021
Page 9 of 15
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 as soon as it is known.
Included in the RM's Application, were Deficit Applications as follows:
2017 Actual Operating Deficit -
$61,015
2018 Actual Operating Deficit -
$81,318
2019 Forecasted Operating Deficit -
$96,476
2020 Forecasted Operating Deficit -
$95,000
Total $333,809
On June 10, 2020, the RM submitted revised Deficit Applications due to calculation errors,
requesting approval of actual operating deficits of $30,476 for 2017 and $35,557 for 2018 or
a total two-year actual operating deficit of $66,033. The revised, four-year actual and
forecasted operating deficit is $257,509.
The RM advises the deficits were a result of amortization related to $4,600,000 for the lagoon,
and is requesting the deficits be recovered from the future years' Utility Working Capital
Surplus funds.
As of the date of this Order, the 2019 Audited Financial Statements (the most recent, required
statements) were unavailable for the Board to review the Utility's 2019 working capital.
Order No. 31/21
March 8, 2021
Page 10 of 15
4.0 Board Findings
The Board has reviewed the application and the projections presented by the RM in its rate
study and finds them to be acceptable. The Board approves the revised rates as applied for
by the RM, but varies the effective dates to April 1, 2021, January 1, 2022, and January 1,
2023.
The Board approves the RM's revised Cost Allocation Methodology and reminds the RM the
methodology must be used consistently; any changes to the Cost Allocation Methodology
require Board approval.
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 (if required) on or before December 31, 2023.
The Board is concerned by the length of time between rate applications for the Utility. It has
been over 25 years since the RM has submitted a Rate Application to the Board, which has
resulted in multiple deficits. In the Board's view, the period between rate reviews is
unacceptable. Regular rate reviews submitted every three years, as per the Board's
Guidelines, protect the financial position of the Utility and may reduce the need for substantial
rate increases in one year.
It is the Utility's responsibility to review the rates and ensure rates are adequate to recover the
cost of service being provided to ratepayers. Ratepayers are generally more tolerant of regular,
smaller increases. The RM needs to be much more diligent in conducting regular rate reviews of
its revenue requirements.
The Board has reviewed the RM's Deficit Applications and notes the RM's 2019 Audited
Financial Statements were unavailable as of the date of this Order for the Board to review
the Utility's 2019 working capital. The Board reminds the Utility, Audited Financial Statements
are to be reported no later than June 30 of the following year. The Board directs the RM to submit
its 2019 Audited Financial Statements as soon as they are available.
Order No. 31/21
March 8, 2021
Page 11 of 15
As per the RM's 2018 Audited Financial Statements, the Utility has a working capital deficit
of $2,012,077 for 2018 and a working capital deficit of $2,035,485 for 2017 as per the RM's
2017 Audited Financial Statements. The Board finds the Utility does not have sufficient
funding to recover the 2017 and 2018 total actual operating deficits of $66,033 or the 2019
and 2020 total forecasted operating deficits of $191,476.
The Board finds the Utility is not in a good financial position to absorb the applied for deficits
and therefore it would be financially imprudent to recover the deficits from future utility working
capital surpluses until they materialize and can be properly analyzed.
The Board therefore denies the RM's 2017 and 2018 actual operating deficit applications and
the 2019 and 2020 forecasted operating deficit applications. The Board directs the RM to
submit revised Deficit Applications for the 2017 and 2018 actual operating deficits, including
a revised recovery methodology. The Board also directs the RM to submit revised 2019 and
2020 Deficit Applications if and when they materialize.
The Board strongly recommends the RM complete and submit its 2019 Audited Financial
Statements as soon as possible. If a sufficient working capital surplus can be evidenced in
the 2019 Audited Financial Statements, the Board will reconsider the recovery of the 2017
and/or 2018 actual operating deficits at that time.
Order No. 31/21
March 8, 2021
Page 12 of 15
5.0 IT IS HEREBY ORDERED THAT:
1. The revised wastewater rates for the Rural Municipality of Sifton, Oak Lake Wastewater
Utility, BE AND ARE HEREBY VARIED in accordance with the attached Schedule A,
effective April 1, 2021, January 1, 2022, and January 1, 2023.
2. The Shared Cost Allocation Methodology for the Rural Municipality of Sifton BE AND IS
HEREBY APPROVED.
3. The Rural Municipality of Sifton is to provide a notice of the decisions found in this Order
to its customers as soon as possible, with a copy provided to the Public Utilities Board.
4. The Rural Municipality of Sifton amend its wastewater rate By-Law to reflect the decisions
in this Order and submit a copy to the Board once it has received third and final reading.
5. The Rural Municipality of Sifton review its wastewater rates for the Oak Lake Wastewater
Utility 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, 2023.
6. The 2017 actual operating deficit of $30,476, the 2018 actual operating deficit of $35,557,
the 2019 forecasted operating deficit of $96,476, and the 2020 forecasted operating
deficit of $95,000 when calculated for regulatory purposes, incurred in the Rural
Municipality of Sifton, Oak Lake Wastewater Utility, is HEREBY DENIED.
7. The Rural Municipality of Sifton submit revised 2017 and 2018 Deficit Applications to the
Board, including a revised recovery methodology, for the Oak Lake Wastewater Utility by
April 30, 2021.
8. The Rural Municipality submit a copy of the 2019 Audited Financial Statements to the
Board as soon as they are available.
Order No. 31/21
March 8, 2021
Page 13 of 15
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 (Rules). The Board's Rules may be viewed on the Board's website
at www.pubmanitoba.ca.
Fees payable upon this Order - $650.00
THE PUBLIC UTILITIES BOARD
"Irene Hamilton, Q.C."
Panel Chair
"Frederick Mykytyshyn"
Assistant Associate Secretary
Certified a true copy of Order No. 31/21
issued by The Public Utilities Board
Assistant Associate Secretary
Order No. 31/21
March 8, 2021
Page 14 of 15
SCHEDULE A
RURAL MUNICIPALITY OF SIFTON
OAK LAKE WASTEWATER UTILITY
WASTEWATER UTILITY RATES BY-LAW NO. 07-2019
1. Schedule of Quarterly Billing Rates
1 Schedule of Quarterly Billing Rates
REU
Total
Commodity
Charge
Service
Charge
Total
Charge
Total
Commodity
Charge
Service
Charge
Total
Charge
Total
Commodity
Charge
Service
Charge
Total Charge
REU
Total
Commodity
Charge
Service
Charge
Total Charge
$ Change
Yr 1
$ Change
Yr 2
$ Change
Yr 2
Residential/ 1REU
1.00
67.06
7.28
74.34
67.86
7.43
75.29
68.69
7.57
76.26
1.00
27.00
8.15
35.15
39.19
40.14
41.11
Churches
0.60
40.23
7.28
47.51
40.72
7.43
48.14
41.21
7.57
48.79
1.00
27.00
8.15
35.15
12.36
12.99
13.64
Public School FLB
8.00
536.44
7.28
543.72
542.90
7.43
550.33
549.49
7.57
557.06
14.00
378.00
8.15
386.15
157.57
164.18
170.91
RM PW Shop & Apt
4.00
268.22
7.28
275.50
271.45
7.43
278.88
274.74
7.57
282.32
2.00
54.00
8.15
62.15
213.35
216.73
220.17
OL Arena
4.50
301.75
7.28
309.03
305.38
7.43
312.81
309.09
7.57
316.66
2.00
54.00
8.15
62.15
246.88
250.66
254.51
OL Golf Club
1.00
67.06
7.28
74.34
67.86
7.43
75.29
68.69
7.57
76.26
2.00
54.00
8.15
62.15
12.19
13.14
14.11
OL MBH - Aspen 2.50
167.64
7.28
174.92
169.66
7.43
177.08
171.71
7.57
179.29
2.80
75.60
8.15
83.75
91.17
93.33
95.54
OL MBH - Oakwood 11.00
737.61
7.28
744.89
746.49
7.43
753.91
755.55
7.57
763.12
12.00
324.00
8.15
332.15
412.74
421.76
430.97
Town Hall/RM Office 3.00
201.17
7.28
208.45
203.59
7.43
211.01
206.06
7.57
213.63
3.00
81.00
8.15
89.15
119.30
121.86
124.48
Legion 1.00
67.06
7.28
74.34
67.86
7.43
75.29
68.69
7.57
76.26
2.00
54.00
8.15
62.15
12.19
13.14
14.11
VV Coop/Flett Shop 1.00
67.06
7.28
74.34
67.86
7.43
75.29
68.69
7.57
76.26
1.50
40.50
8.15
48.65
25.69
26.64
27.61
VV Coop (new) 2.00
134.11
7.28
141.39
135.73
7.43
143.15
137.37
7.57
144.95
-
Canada Post & Apt 2.00
134.11
7.28
141.39
135.73
7.43
143.15
137.37
7.57
144.95
-
OL Curling Club 0.60
40.23
7.28
47.51
40.72
7.43
48.14
41.21
7.57
48.79
-
WD Plant 2.00
134.11
7.28
141.39
135.73
7.43
143.15
137.37
7.57
144.95
-
OLS FDw911 2.50
167.64
7.28
174.92
169.66
7.43
177.08
171.71
7.57
179.29
-
OL&D Museum 0.60
40.23
7.28
47.51
40.72
7.43
48.14
41.21
7.57
48.79
-
OL Community Hall 5.50
368.80
7.28
376.08
373.24
7.43
380.67
377.77
7.57
385.35
-
OL Hair Design
1.50
40.50
8.15
48.65
Restaurant&Grocery
3.50
94.50
8.15
102.65
OL Meat Market
1.50
40.50
8.15
48.65
Oakland Hotel
6.00
162.00
8.15
170.15
Year 1
Year 2
Year 3
1995
# Customers 206.00
206.00
206.00
186.00
Total REUs 240.00
240.00
240.00
226.80
Svc Chrg/Cust 7.28
7.43
7.57
8.15
Comm Chrg/REU 67.06
67.86
68.69
27.00
Summary of Proposed Utility Charges versus Current Charges (1995)
Proposed Year 1 (2021)
Proposed Year 2 (2022)
Proposed Year 3 (2023)
1995 (Current Rates)
Order No. 31/21
March 8, 2021
Page 15 of 15
2. Sale of Wastewater Treatment Lagoon Services
Lagoon tipping fees of $50.00 per truck load for use of the RMS lagoon.
3. Sale of Wastewater Services to Customers Outside of Urban Centre of Oak Lake
Limits
Provision of sewer services are available with Council approval. All installation costs are
the responsibility of the consumer including all materials and service required for
connection to main wastewater network. The RM Sifton must certify connection all
connections are installed to code and other requirements as needed.
4. Administration Fee
A consumer who has not paid his/her bill by December 1st of each year will be charged
and administration fee of $10.00 to cover the costs of adding outstanding accounts to
the tax roll.
5. Billing Period, Due Date and Penalties
Quarterly billing is being done on the first of the months of January, April, July, and
October billed in advance. It is recommended this remain as is. Bills are due 30 days
after billing date and late payment charges of 1.25% shall be charged to outstanding
amounts beginning the following month and shall be applied monthly until dues are paid
in full.
6. Wastewater Surcharges
All sewage is considered "domestic sewage" and no surcharges shall be charged for
"extra strength" sewage.
7. Connection and Reconnection Charges
The installation of a new curb-stop by the RM from main sewer line will be charged a
basic flat rate of $3,000.00 per connection. Any new connection or reconnection of a
new building to an existing curb-stop generally does not require any RM staff or
expenditures so a basic administration charge of $100.00 will be charged.
8. Disconnection and Outstanding Utility Charges
Any outstanding utility charges to be pursued as per Section 252(2) of The Municipal
Act as a lien and charge upon that land and not applied to the Tax Roll. For sewage
haulers, access will be denied if bills are not paid.