On 28 March 2023, the Nova Scotia Utility and Review Board (UARB) approved a request from the CBRM (on behalf of its Water Utility) for a rate hike, the municipality’s first since 2019.
The increase, for residential customers, will look like this:
The Board also approved a plan to phase out the Water Utility’s “two-block” rate structure for high-volume users, of which the CBRM has 13, the largest of which, by far, is Nova Scotia Power Inc. (Others include the regional hospital and the Holiday Inn.)
Back in October 2022, Gerry Isenor, the consultant preparing the rate-hike application, told council the current structure:
…is based on 20,000 cubic meters at the Block 1 rate with all water after that sold at the Block 2 rate. The Utility is requesting that the Block 1 size be changed to 35,000 cubic meters in the first test year, 120,000 cubic meters in the second test year, and that the second Block rate be eliminated in the final test year.
According to Isenor, such two-tier rate structures are being phased out across North America and CBRM was one of the last municipalities in Nova Scotia to do so.
I’m attaching a copy of the decision at the end of this article because it provides a surprisingly easy-to-comprehend account of the rate-hike and other issues related to the Water Utility. It also raises a couple of issues I want to note specifically, because they’re interesting:
Uncollectibles
The CBRM Water Utility (referred to in the decision simply as “the Utility”) told the board that its:
…bad debts of $100,000 per year plus interest comes from the allowance for uncollectible accounts and account write-offs that have a current outstanding balance of $6,614,070. The allowance represents, on average, 20% of the total year-end receivables and all accounts greater than six years outstanding are written off.
The Water Utility told the Board that collection of overdue accounts had been suspended during COVID-19 and that there were “significant resource issues with the position responsible for water rate collection” (which must be an awful job) but that position has been filled for the last six months and:
The Utility is taking an aggressive stance towards collection. Payment plans and letters for disconnection have been recently distributed to collect the overdue accounts.
Projects >$250K
The UARB rapped the Water Utility’s knuckles for failing to seek formal Board approval for projects worth more than $250,000, a “legal obligation” under the relevant legislation.
The decision notes that this isn’t the first time the Utility has been “remiss” in this way—in 2019, it “failed to request approval for 17 projects worth $10.4 million.”
Then, as now, the Utility called its failure an “oversight” which it blamed on “key senior management staff changes” and assured the Board it intended to strengthen its policies. During the February hearing, the Board “verbally directed” the Utility to submit the outstanding capital projects for approval (this was done and the approval was granted on 1 June 2023, you can view the list by looking up the file—M11033—on the UARB site).
But the Board, sounding like a disappointed parent, wrote:
Board approval is not optional but is required under the Public Utilities Act. Seeing that the Utility has twice failed to meet this legal obligation, the Board considers it important that the Utility establish proper procedures and policies so that such “oversights” are prevented during times of staff transition. The Utility is the second largest water utility in the province and aspires to move towards a water and wastewater commission model. The Board expects a much higher level of attention to this issue, commensurate with the Utility’s size and sophistication.
Ouch.
Dam it
The CBRM Water Utility owns and operates three dams—MacAskills Brook, City Reservoir and Rotary Park—and damn, they seem to be in rough shape.
The Board notes that a dam safety review carried out 2022 rated the MacAskills Brook Dam as “fair,” a City Reservoir Control Structure report dated June 2016 rated the overall system “to be in poor condition,” and the Rotary Park Control Structure report dated June 2016 found the structure “was a public safety hazard.”
The Utility noted during the hearing that:
…the City Reservoir and Rotary Park Dam are very small and are not currently being used for water supply. There are discussions underway with the Department of Environment to take the Rotary Park Dam out of service. The Board stresses the importance of safety with these structures and encourages the Utility to monitor this situation closely.
The Utility has plans for upgrading the MacAskills Brook Dam.
Here’s the full decision:
M10843 Decision CBRM 2022
