By Alessia Proietti

2.7 per cent increase across the board

Lacombe council approves utility rate increase, but has concerns if it’s enough

Jan 28, 2022 | 2:06 PM

Lacombe city council has approved a utility rate increase of 2.7 per cent each for water, wastewater and solid waste.

The approval was given at Monday’s council meeting, but concerns were raised if this number will be sufficient.

For the average household, the combined utility bill increase will be $4.75 per month or $57.01 per year.

For water, the monthly fixed rate will increase from $27.82 to $28.57 covering administration and distribution costs. The per-unit consumption rate will increase from $2.56 to $2.63 per cubic metre and the bulk water from $4.79 to $4.92 per cubic metre, accounting for the costs of purchasing water from the regional water commission and water losses.

For wastewater, the monthly fixed rate will increase from $20.79 to $21.35 covering administration, debt payments and a portion of operation costs. Consumption rates will increase by $2.75 to $2.82 per cubic metre to account for variable costs of treatment and the North Red Deer Regional Wastewater Commission charges.

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Solid waste includes residential garbage pickup, yard waste and composting, and the recycling centre on Wolf Creek Drive. Monthly increases will be as follows:

• Residential solid waste: from $31.76 to $32.62
• Apartment (four or more units): from $19.97 to $20.51
• Modular Home Park: from $24.49 to $25.15
• Commercial: from $116.79 to $119.94 per bin
• Additional cardboard pickup: from $106.79 to $109.67
• Unscheduled pickups: from $58.39 to $59.97 for commercial and from $53.39 to $54.83 for cardboard

City officials say the expected revenue generation from the rate increase is $4,736,982 for water, $4,509,741 for wastewater, and $2,564,716 for solid waste.

Tracey McKinnon, Senior Manager of Financial Services for the City, ended the presentation raising the point that a more in-depth review on rates would be necessary in 2023 as the proposed increase may not be sufficient to cover unexpected costs from inflation. A slight reduction has been seen being put into reserves and costs are expected to increase beyond the projected revenue, she explained.

Mayor Grant Creasey had concerns over the accuracy of the rate increase to properly recover costs. He also asked what message it would send to the public having the utility rate increase be the same as the city’s 2.7 per cent tax limit increase resulting from the calculated Consumer Price Index.

“We need to consider a formula or a reasonable expectation. Just to have this the same amount across the board, it appears underhanded to the public,” said Mayor Creasey.

Councillor Thalia Hibbs expressed a rates review is overdue as the City of Lacombe had the highest rates for solid waste compared to other communities like Bentley, Blackfalds, and Red Deer but lacked in services such as curbside pickup.

Chief Administrative Officer (CAO) Matthew Goudy responded that projections from previous years, such as the 10-year capital plan, are not specific enough to tie needs to rate increases. With projects expected ahead but unclear costs alongside reserves that are “not in a healthy position”, he notes specific numbers related to rate increases are also unknown as a result.

“Because we are just working through those things, we took the 2.7 per cent guidance, said ‘that’s the tolerance for this year, let’s get a better handle on our utilities, and what the future costs are and the future needs are’, and then we can come back for 2023 and make those adjustments,” said CAO Goudy.

Unanimously approving a second and third reading, the rates will be effective as of Jan. 1, 2022.