Council approves $22M spike for water system amalgamation
The amalgamation of the city's water utility with the South East Kelowna Irrigation District will cost $86 million, thanks to higher-than-expected construction costs, and the need for a more in-depth design.
That's $22 million more than originally expected, with the majority of the added cost to be passed on to ratepayers in the form of a loan.
A $15.3 million loan from the city will be repaid over 20 years, by way of a service charge to customers.
Senior Engineer Ron Westlake says SEKID customers will see a $32 dollar on their bills, starting in July.
"This amount will remain in place until 2021, at which time it will increase to $40/month, and remain in place until 2038," he said.
"SEKID ratepayers will then receive a lower domestic rate for their water service, and even with the increase from $32 to $40 in 2021, it'll be offset by this reduction in the actual rate, so it's almost what they'd be paying in July of this year."
2021 is the timeline for the amalgamation to be completed.
He says this could still save people money, especially if they've had to outfit their homes with filtration systems.
"Knowing this project is a couple years away, they can just make modifications to their existing one, just to do repairs as opposed to replacing it," he said.
"Once the system is up and running in 2021, there shouldn't be a need for in-house filtration systems for individual properties."
Roughly 6.1 million dollars of the increase will be paid out of the city's reserves, with the remaining $600,000 dollars paid out by SEKID itself.
Councillor Brad Sieben says water quality has been an issue for a lot of people for a long time, and he says they're ready to see change.
"I have not run into one (person) yet that isn't excited by this proposition, to have a better quality water coming out of their tap," he said.
"I know there's apprehension on the agricultural side just a bit, but from a domestic users standpoint, 2021 - I think people are circling on their calendars to see a change. For many people, it's been years and years, and the notion that this is on the horizon is exciting for them."
The amalgamation plans also include the South Okanagan Mission Irrigation District, which provides agricultural water to customers in the south end of town.