Centre Wellington council approved two infrastructure measures on Monday night, with one councillor opposed – despite the need.
Council agreed to apply to the Federation of Canadian Municipalities for a grant of $1-million, and a loan of $10-million to build a new Elora sewage treatment plant with a total cost of $16.5-million.
Later in the meeting, council approved a tender to build a water tower in Fergus for $3.39-million from Landmark Structures Company, of Burlington. That price includes contingencies and HST. Council also approved that Treasurer Wes Snarr apply for a loan for that project through the CMHC municipal infrastructure lending program for $2.26-million for a term of 15 years.
Councillor Walt Visser asked if the township is borrowing from reserves.
Snarr said the total debt would be $12.4-million for the projects and the FCM provides a better rate of 3.2%. The township’s share of the sewage treatment plant will be funded through reserves. The entire $10-million borrowed for the plant will be recovered through development charges and not cost taxpayers anything.
Engineer Dale Murray said the township has a good chance of getting the grant and loan because this is not a lottery style application, but is based on merit and sewage treatment plants are highly rated.
Mayor Joanne Ross-Zuj explained the FCM is aware of impending changes being brought down by the federal government for such plants, and it has $500-million for water related projects.
Councillor Bob Foster was opposed. He said, “Ten million dollars is a fair chunk of money.” He added the tower and sewage treatment plant combined almost double the township’s debt, and it will all have to be paid back.
Snarr said, “Most municipalities in Ontario would love to be in the position of Centre Wellington.”
The township used its slots cash to pay its one-third share of several municipal infrastructure projects. While others are now scrambling to pay back the money they borrowed, Centre Wellington did not borrow anything for those projects.
Foster asked what the existing debt is.
Snarr said municipalities are permitted to borrow up to 25% of their revenues, and Centre Wellington’s current debt percentage is seven. He said with the loans for the two projects, it will be just over eight per cent.
Foster said the township owed $14.1-million at the start of the year.
Several councillors appeared upset with Foster. Ross-Zuj explained the township has known for over four years the sewage treatment plant needs replacing.
She said it is “vulnerable” – an assertion backed up by Public Works Director Ken Elder. He warned if nothing is done, “I get the upper bunk.”
He was referring to fines and jail time that can be levied on officials and council if there is a major spill, because council knew about the problems and did nothing about them. He said in some instances there are lines running above ground because the underground ones are “burned out.”
Councillor Walt Visser said council has known of the need for the Fergus water tower since 1994. The Forfar tower’s usefulness is ended.
He asked Foster to suggest alternatives to spending the money and still act responsibly. Foster’s only response was the projects cost a lot of money.
Visser appeared to lose patience with that.
“We are managing our money,” he said. “If you attended the strategic plan meetings you would see we are responsible.”
Councillor Fred Morris said of the sewage treatment plant, “It’s a lot of money, but we don’t have a choice.”
Council then approved seeking the loan and grant. Foster was opposed. Councillors Ron Hallman and Shawn Watters were absent.
When council considered the water tower project in Fergus, Visser asked why it had gone over budget, since the projection in 2008 was $1.8-million.
Murray explained the township hoped to use a tower similar to others in the town, but found the pressure was too low. The new design calls for a 750,000 gallon tower that is 34 feet higher, and which has pressure reducing valves. He said that will create a second pressure zone for that area.
Murray noted the soils on the tower site are also not conducive to a tower, and extra work needs to be done.
But, he said, the cost of highly specialized labour had jumped spectacularly for welders.
“I think the price is quite realistic,” he said.
Foster asked why the tower, at 34-feet higher to increase pressure, needs pressure reducing valves.
Murray explained the pressure in the Fergus industrial subdivision is under standard, and some companies have refused to locate there because of that.
He said adding 34 feet to the tower will increase pressure when it is needed, but when water is not running, it needs to be reduced or it will cause overflows on other water towers in the town.
Elder explained the maximum pressure is 100 pounds per square inch, and the minimum is 35. He said when one company is pumping in the subdivision, the flow from the current tower is reduced to 22 pounds per square inch, leaving little water for such things as fighting fires.
Foster asked how long this has been a problem.
Elder said, “Every since I came to Fergus – in 1995.”
Snarr added the money for the tower and sewage plant will come from growth, through development charges, and not the tax base.
Council then approved the water tower tender, with only Foster opposed.
