Water and Wastewater User Rate Budget Barries Finance Committee - - PDF document

Water and Wastewater User Rate Budget

Barrie’s Finance Committee – 12-10-24

1

Water System Assets

1 – Surface Water Treatment Plant 12 - Production Wells 620 kms – Water main 3,600 Hydrants 24,000 Valves 5 - Water Storage Facilities 6 B t P i F iliti 6 – Booster Pumping Facilities

2

Water System – Asset Value & Condition

Overall Water System Value: $488M

y

y $

• Water Treatment Component:- $133M (replacement

p $ ( p cost of plant and wells and pumping stations)

• Water Distribution component:- $355M (replacement

cost mains hydrants valves storage towers and cost mains, hydrants, valves, storage towers and reservoirs, meters and booster stations)

• ½ of the linear Assets over 32 years old – many city

core pipes beyond 75 years (in some phase of core pipes beyond 75 years (in some phase of corrosion)

3

Water System – Asset Replacement Needs y

$140

Water Asset Replacement Costs by Remaining Useful Life

$100 $120 $140 Cost (in Millions) $40 $60 $80 nt Replacement C $0 $20 $40 0 Years 1 - 10 11 - 20 21 - 30 31 - 40 41 - 50 51 - 60 61 - 70 71 - 80 81 - 90 Curren Years Years Years Years Years Years Years Years Years Remaining Useful Life

4

Water System – Customer Information

• 42,500 water customers (40,000 Residential, 2,500 ICI)

(140 000 persons) 100% metered

Water System Customer Information

(140,000 persons) – 100% metered

• 172 lpcd - Average Residential Consumption: (National

average: 229 lpcd – Barrie is at 75% of National Average – due to City’s Water Conservation efforts/promotion ongoing y p g g

• ver many years)
• $212/year – Average Residential cost of water (NWWBI –

national average: $325/year (Barrie @ 65%))

• Individual Customer access to water usage, via the internet –

since October, 2011

• 60 – number of Licensed/Certified Operational Staff serving

Barrie Water Customers (some 20% less than National Barrie Water Customers (some 20% less than National average)

5

Water System – Operational Drivers

• Water Demand – countered by Conservational Promotion

Water System Operational Drivers

y – impacts all other drivers and capital expenditures

• Energy Costs – impacted by demand and operational
• ptimization
• ptimization
• Chemical Costs – impacted by demand and raw water

quality

• Staffing Requirements (largely governed by

Legislative/regulatory requirements)

• Fleet Costs – impacted by demand and state of the

p y infrastructure as well as operational efficiencies

6

W t S t F t L i l ti /R l ti

• Source Protection Planning (Clean Water Act – CWA) – cost

Water System- Future Legislation/Regulations

Source Protection Planning (Clean Water Act CWA) cost implications

• Tightened Regulatory Limits (SDWA) – THM’s, HAA’s, etc.
• Ongoing Operator Certification restrictions (OWRA O Reg
• Ongoing Operator Certification restrictions (OWRA, O.Reg

128/04) – Succession Planning resource implications.

• Enforced “Best Practices” adherence through Regulatory

Compliance Inspections (MOE) – cost/resource implications Compliance Inspections (MOE) – cost/resource implications.

• Bill 8 – Infrastructure Locating requirements – mandatory Ontario

One Call integration - tightened requirements, timelines guarantee periods etc guarantee periods, etc.

• Annual Re-Accreditations increasingly stringent requirement

7

Water System – Operational Improvements, a e Sys e Ope a o a p o e e s, Managing Costs

• Underwent Service Area Review in 2011

–Implementing recommendations of service review - ongoing

• Converted to “AMI” – “go-live” October, 2011

A d W t M t R di d Billi f f l t t d –Assumed Water Meter Reading and Billing from formerly contracted (PowerStream) service – cost saving. –Water Meter reading interval now received every six (6) hours versus previous 60 day interval – automated via radio transmission versus walking route walking route. –Opportunity for Barrie Customers to monitor Water Use via the Web on an ongoing basis and apply real time knowledge to Water Conservation (Bill Management ) practices. –Improved Customer Service - high water use –Improved Customer Service - high water use –Reduced potential for uncontrolled non-revenue water production. 8

Water System – Operational Improvements, M i C t

• Converted to CMMS (Computerized Maintenance

Managing Costs

Management System – “Cityworks”) from former paper based program – “Go-Live” February 2012.

– Better management & Traceability of all maintenance activities. – Compliant reporting to MOE (Ministry of the Environment). – Extended infrastructure life (over the long term). – Potential reduction in “unplanned” reactive maintenance efforts versus “preventative” maintenance activities. – More “strategic” deployment of resources over time P t ti l d ti i t d ti – Potential reduction in system down time. – Future Activity Based Costing.

9

Water System - Operational Quality, Managing the S t

• Operated to meet all requirements of the Safe Drinking Water Act (SDWA)
• System Fully Licensed and Operating Authority Fully Accredited – both annually

fi d

System

reconfirmed.

• Fully compliant with Drinking Water Quality Management System (DWQMS) – ongoing updates

and auditing.

• 12 Adverse Water Quality Incidents (AWQI’s) in 2011 – all responded to in accordance with

y ( ) p MOE/SMDHU protocols – none resulted in unsafe drinking water.

• ~2800 microbiological samples tested per year (2011).
• Continuous monitoring (every 2 seconds) for Chlorine Residual, pH, Turbidity, Temperature – in

several city wide locations several city wide locations

• Several thousand chemical samples / tests undertaken quarterly and annually in full accordance

with Regulatory requirements – public record.

• 96.55% - 2010-2011 MOE Compliance Inspection Rating.
• 99.92% - 2010-2011 Drinking Water Quality (% tests meeting Standards).
• Water Operations participates in “MPMP”, “OMBI” and “NWWBI” – in an effort to improve

efficiency and service levels – Service Review noted Barrie’s positive position 10

Water System

• Operational Costs

Water System Operational Costs

Employee Costs General Operations

2012 Budget 2012 Forecast 2013 Budget 2013 Budget - 2012 Budget $ %

General Operations Minor Capital Energy Fleet & Equipment Property Rent

$ Water Operating Expenditures $13,808,817 $11,644,313 $12,991,612

• $817,205
• 5.92%

Corporate Support $3,354,270 $3,348,652 $3,459,723 $105,453 3.14% Debenture $6,743,791 $6,897,316 $7,904,093 $1,160,301 17.21% G $ $ $ $ % Total Gross Expenditures $23,906,879 $21,890,281 $24,355,428 $448,550 1.88% Water User Rate Revenues

• $21,956,910
• $21,350,000 -$23,054,755
• $1,097,845

5.00% Other Operational Revenues

• $324,500
• $338,814
• $335,000
• $10,500

3.24% Billing Interest Penalties

• $11 820
• $25 707
• $30 000
• $18 180

153 81% Billing Interest Penalties $11,820 $25,707 $30,000 $18,180 153.81% Contributions from DC Reserves

• $1,930,440
• $1,959,129 -$3,477,800
• $1,547,361

80.16% Total Revenues

• $24,223,670
• $23,673,649 -$26,897,555
• $2,673,886

11.04% Transfer to Water Reserve $316,791 $1,783,369 $2,542,127 $2,225,336 702.46%

11

Water System - Proposed Program Change Forms y p g g

2012 Budget 2013 Budget 2013 Budget - 2012 Budget $ % Water Operating Expenditures $13,808,817.01 $12,991,612.36

• $817,204.65
• 5.92%

2013 Water Program Change Forms: Legislated Legislative Requirement To Locate Corporate Infrastructure $85,854.14 Asset Mgmt Water Infrastructure and System Renewal/Expansion and Commissioning; and Preventative Maintenance Program $288,586.72 g g Asset Mgmt Water Operations Project/Program Management $62,849.76 Asset Mgmt Technical Administrative Support for Water Operations CMMS $144,051.68 Efficiency Water Treatment System Electrical Maintenance

• $43,409.13

Revised Total Operating Expenditures $13,808,817.01 $13,529,545.53

• $279,271.48
• 2.02%

Revised Total Operating Expenditures $13,808,817.01 $13,529,545.53 $279,271.48 2.02% Total Gross Expenditures $23,906,878.53 $24,893,361.41 $169,278.23 4.13% Total Revenues

• $24,223,669.93
• $26,897,555.48
• $2,673,885.55

11.04% Transfer to Water Reserve

• $316,791.40
• $2,004,194.07
• $2,504,607.32

532.65%

12

Water System – What needs to be done?

• Additional investment required now to achieve Best Practice and to

avoid future increases in O&M costs and premature capital needs.

y

avoid future increases in O&M costs and premature capital needs. Among these are: 1. System wide cathodic protection (DI & CI pipe) - $1,195,000 - Current Barrie practice is to add anodes with every necessary e ca ation practice sho ld contin e O erall polic sho ld be excavation – practice should continue. Overall policy should be developed to assess cathodic protection versus metallic pipe replacement prioritization over a period of years (Engineering and CAM Departments). Without this more emergency expenditures. 2. Valve cycling improvement - (annual expenditure) $580,000/year

• Barrie cycles approximately 5%/yr

(1,200 of 24,000 valves/yr total) – recommended 30%/yr (7,200 valves/yr). Barrie will need more staff resources to ultimately meet Best Practice Target. more staff resources to ultimately meet Best Practice Target. Failure to do so leads to real risk of costly operational impacts and premature replacements at high cost.

13

Wastewater System Assets

1 – Expanded/upgraded Waste water Treatment Facility Waste water Treatment Facility 1 – Biosolids Storage/Treatment Facilities 526 kms – Sanitary Sewers 7 700 Maintenance Holes 7,700 Maintenance Holes 42,500 Service Connections 13 – Sewage Pumping Stations 14

Wastewater System – Asset Value

• Overall Wastewater System Value:- $800M

Wastewater System Asset Value

Overall Wastewater System Value: $800M

– Wastewater Treatment Component:- $400M (replacement cost of plant and biosolids facility) – Wastewater Collection Component:- $400M (replacement cost of sanitary mains and pump stations) stations) – ½ of the linear Assets over 37 years old – many city core pipes beyond 75 years (in some phase of deterioration)

15

Wastewater System – Asset Replacement Needs y p

$160

Wastewater Asset Replacement Costs by Remaining Useful Life

$100 $120 $140

• st (in Millions)

$60 $80 $100 Replacement Co $20 $40 Current $0 0 Years 1 - 10 Years 11 - 20 Years 21 - 30 Years 31 - 40 Years 41 - 50 Years 51 - 60 Years 61 - 70 Years 71 - 80 Years 81 - 90 Years Remaining Useful Life

16

Wastewater System – Customer Information

• 42,500 water customers (40,000 Residential, 2,500 ICI -

i 140 000 )

Wastewater System Customer Information

serving 140,000 persons)

• 215 lpcd - Average Residential Contribution
• $321/year – Average Residential cost of Wastewater (near

average yet Barrie has much more stringent treatment average – yet Barrie has much more stringent treatment requirements)

• Individual Customer access to water usage, via the internet –

since October, 2011 – guide to assessing Wastewater since October, 2011 guide to assessing Wastewater charges

• 33 – number of Licensed/Certified Operational Staff serving

Barrie Wastewater Customers (some ~20% less than N ti l ) National average)

17

Barrie’s Municipal Wastewater System –

• Wastewater Flow – countered by Conservational Promotion and I/I

(I fl d I filt ti ) R d ti Eff t i t ll th d i

p y Operational Drivers

(Inflow and Infiltration) Reduction Efforts – impacts all other drivers

• Energy Costs – impacted by flow and operational optimization
• Chemical Costs – impacted by flow and raw sewage quality and

effluents restrictions (legislation/regulations)

• Staffing Requirements (largely governed by Legislative/Regulatory

requirements)

• Fleet Costs – impacted by demand and state of the infrastructure as

well as operational efficiencies

• Biosolids Treatment/Handling/Utilization – impacted by flow, raw

g p y , sewage quality and effluents requirements

18

Wastewater System- Future Legislation/Regulation

• Tightened Regulatory Limits – Effluent Quality – Nutrient

y g g

g g y y (Phosphorus, Ammonia, etc.) discharge limits. (LSPA, ECA)

• Ongoing Operator Certification restrictions – Succession

Planning resource implications Planning resource implications

• Enforced “Best Practices” adherence through Regulatory

Compliance Inspections (MOE) – cost/resource implications implications

• Biosolids Utilization Regulations (NMA – Nutrient

Management Act – nutrient management plans)

• Expanded Service Area(s)

19

Wastewater System – Operational Improvements Managing Costs

• Service Area Review in 2011

– Implementing recommendations of service review - ongoing

Wastewater System Operational Improvements, Managing Costs

Implementing recommendations of service review ongoing

• Improved Staff Shift Schedule:-

– Considerably more on-going scheduled operational coverage (from previous 8 hours/working week day and single person 8 hours/weekend day coverage to 15.5 hours/ working week day and minimum of 2 person @ 12 hours/weekend day coverage. Reduction in unscheduled overtime and unplanned call outs – Reduction in unscheduled overtime and unplanned call-outs – Improved staff morale – equity amongst operating disciplines

• Much less unmanned operation hours (was 33% total weekly

coverage now 60% total weekly coverage)

– Considerably more opportunity for operational staff to experience full responsibilities of Considerably more opportunity for operational staff to experience full responsibilities of plant operation

• Process Optimization Investigations

– On site Oxygen Generation versus purchase – BioSolids Haulage alternatives O i i i f P bl W – Optimization of Potable Water use – Energy production – Polymer handling and usage

20

Wastewater System Operational Improvements Managing Costs

• Improved Effluent quality

– Desktop and Pilot Study for improved Phosphorus Removal to meet legislative/regulatory requirements

Wastewater System – Operational Improvements, Managing Costs

p y p p g g y q (LSPA & ECA - Lake Simcoe Protection Act and Environmental Compliance Approval)

• System Optimization

– Chemical Usage Reduction Studies – ongoing

• Alum (coagulant) usage reduction
• High Purity Oxygen usage reduction

Raw Sludge Thickening – Raw Sludge Thickening

• New VFD (Variable Frequency Drives) driven Raw Sludge Pumps and Sludge Density Meter

– Influent Works Improvements

• New Bar Screens

– Raw Sewage Pumps Upgrades

• To replace existing ~25 year old pumps

Rene ed Septage Recei ing – Renewed Septage Receiving

• Revenue generating

– Inflow and Infiltration Control – reduces plant inflow

• Improved/Upgraded CMMS (Computerized Maintenance Management System)

– Including all new equipment associated with the 76ML/day expansion and Oro Biosolids upgrade

M t i l C t l d P j t C di ti

• Material Control and Project Co-ordination

– Improved organization & control – Overseeing Engineers/Contractors with coordinated integration with operational overlap – Information sharing timeliness improvement

21

Wastewater System - Operational Quality

• Operated to meet all requirements of the OWRA (Ontario Water

Resources Act), accompanying Regulations and system specific

y p y

CofA’s/ECA’s (Certificates of Approval / Environmental Compliance Approvals

• System Fully Classified and operated in accordance with the

classifications

• Barrie’s WwTF (Wastewater Treatment Facility) was fully compliant with

all Effluent Limits and Loadings (2011)

• Several thousand chemical samples taken and tested annually in full

accordance with Regulatory requirements to ensure effluent quality.

• WWOB (Wastewater Operations Branch) participates in “MPMP”,

( p ) p p , “OMBI” and “NWWBI” – in an effort to improve efficiency and service levels - Service Review noted Barrie’s positive position

22

Barrie’s Municipal Wastewater System - Operational Costs

Employee Costs

2012 Budget 2012 Forecast 2013 Budget 2013 Budget - 2012 Budget $

p y General Operations Minor Capital Energy Fleet & Equipment Property Rent

$ % Wastewater Operating Expenditures $13,016,690 $12,759,401 $13,597,542 $580,852 4.46% Corporate Support $3,042,774 $3,154,274 $3,215,267 $172,493 5.67% Debenture $7,280,054 $6,480,602 $8,207,744 $927,690 12.74% T t l G E dit $23 339 518 $22 394 277 $25 020 553 $1 681 035 7 20% Total Gross Expenditures $23,339,518 $22,394,277 $25,020,553 $1,681,035 7.20% Sewer User Rate Revenues

• $23,747,001
• $23,470,663
• $26,121,700
• $2,374,699

10.00% Other Operational Revenues

• $355,730
• $260,791
• $293,947

$61,783

• 17.37%

Billing Interest Penalties

• $11,820
• $25,707
• $30,000
• $18,180

153.81% Contributions from DC Reserves

• $3,527,812
• $3,527,812
• $3,547,706
• $19,894

0.56% Total Revenues

• $27,642,363
• $27,284,974
• $29,993,353
• $2,350,990

8.51% Transfer to Sewer Reserve $4,302,845 $4,890,696 $4,972,800 $669,954 15.57%

23

Wastewater System – What needs to be done?

• Biogas Storage (heat/electrical)

Wastewater System What needs to be done?

• Biogas Storage (heat/electrical)
• Wastewater sludge thickening to reduce transportation

cost

• On-site Oxygen Generation rationalization

On site Oxygen Generation rationalization

• BioSolids Haulage alternatives
• Optimization of Potable Water use
• Polymer Handling and Usage

y g g

• Phosphorous Trading
• Further Phosphorus Reductions
• Replacement/rehabilitation of deteriorating mains

H d k i t

• Head works improvements

24

Reserves – How much is enough?

• Ongoing replacement and emergency work is required and must

be pre-planned financially

Reserves How much is enough?

p p y

• The minimum Reserve amount necessary too avoid

unmanageable Risk is 4% (many municipalities aim for many times this, e.g. Region of York – 20%) , g g %)

• Minimum Reserves for Water = $19.5 million
• Minimum Reserves for Wastewater = $32 million
• Barrie has inadequate reserves – need $51.5M (have -$13M)

Barrie has inadequate reserves need $51.5M (have $13M)

• Legislated / Regulated Financial Plan (SDWA),

approved/adopted by Council, June 2010 for 6 years, set:-

– 13% annual increase for Water, and 13% annual increase for Water, and – 19% annual increase for Wastewater

• Any variance should be preceded by a revised Financial Plan

25

Water System – What needs to be done? Water System What needs to be done?

25 30 illions)

Water Reserve Balance Scenarios

15 20 25 ve Balance (in M 5% Incr in Rev 2010 Financial 5 10 15 Ending Reserv Plan 7% Incr in Rev 5 2011 2012 2013 2014 2015

A 7% rate increase equates to an extra $16.38 per year for a A 7% rate increase equates to an extra $16.38 per year for a Typical Household Consuming 180 m3 per Year

26

Wastewater System – What needs to be done? Wastewater System What needs to be done?

• ns)

Wastewater Reserve Balance Scenarios

• 10
• 5

Balance (in Millio 10% Incr in Rev

• 20
• 15

Ending Reserve B 2010 Financial Plan 12% Incr in Rev

• 25

2011 2012 2013 2014 2015 E

A 12% Rate Increase Equates To An Extra $39 per year for a Typical A 12% Rate Increase Equates To An Extra $39 per year for a Typical Household Consuming 180 m3 per Year

27

Questions?

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