Petrolia will have to find another way to deal with rising costs of its water system.
Officials with the Lambton Area Water System say they will sell the town water at double the rate of production but aren’t interested in having Petrolia become a partner in the system..
Petrolia has owned its own water system since 1896 however the Bright’s Grove treatment plant is aging and the entire water system needs an estimated $25 million in repairs over 10 years according to Chief Administrative Officer Manny Baron.
So the town met with the Lambton Area Water Supply System to see what it would take to become a member and purchase water. Officials asked LAWSS to hire a consultant to place a price on Petrolia buying in.
Town officials expected to pay a buy-in fee of about $6.2 million as well as the costs of decommissioning the Bright’s Grove plant and hooking up to the LAWSS system. Officials estimate that would cost about $2 million.
The town’s proposal – which was included in Monday’s council package – adds the town would still have to replace a booster station at a cost of $2.3 million and the Mandaumin Water Reservoir at a cost of $2.7 million. The province has already provided a $2 million grant for that work.
The analysis by the town’s treasurer shows if Petrolia were to become a member of LAWSS, it would increase the group’s water production by 6 to 7 per cent generating $687,000 more revenue for the organization’s member agency potentially reducing their costs.
It would also help hold the line on rate increases in Petrolia. As a member of LAWSS officials estimate water rates would increase 23 per cent over eight years. If the town has to foot the repairs for the water treatment plant, rates could rise 67 per cent over eight years to $2.92 per cubic meter.
Becoming a member of LAWSS would also help lower Petrolia’s water debt by over $6 million and operating costs by about $700,000 per year.
Baron, adds by forming a truly regional system, it may be easier to get federal and provincial grants, since upper levels of government like sharing of major infrastructure.
He added buying water from LAWSS at double the rate of production would not generate nearly the savings of joining the system. The town projects water rates would still rise 60 per cent over eight years and there would be no savings in operating the system.
If grants were secured, Petrolia’s water rates under the LAWSS system could be lowered even more – and more savings could be passed along to its water partners, Enniskillen, Oil Springs and Dawn-Euphemia.
But the LAWSS board didn’t like the idea of a new partner at this time. Sarnia City/County Councillor Andy Bruziewicz is the chair of LAWSS. He says the board members “had their own reasons” for turning down the request and offering to sell water to Petrolia at double the rate of production as it does for Brooke-Alvinston.
“There are some challenges there,” he told The Independent. “Even arriving at the fair buy in price might take some time.”
Bruziewicz added some members expressed concern about Petrolia’s deal with its neighbours. “Petrolia would buy water for 57 cent, then they would just be reselling it to Enniskillen and making a lot of money.”
Bruziewicz added while LAWSS didn’t want to entertain Petrolia as a member now, that “doesn’t mean it can’t happen in the future.”
Petrolia Councillor Joel Field was disappointed by the move. “This could have really helped the other municipalities …it definitely benefited us as well as our neighbouring municipalities and they turned it down flatly.”
Councillor Mary-Pat Gleeson was also frustrated calling the decision “arcane” and “disrespectful” adding at first she was disappointed but now she was “really angry…we work very hard to partner with other municipalities,” Gleeson says adding the municipality will simply find another way to deal with the aging infrastructure without LAWSS’s help.
Mayor John McCharles wondered why LAWSS members wouldn’t look at their projected savings noting Sarnia – which revealed last week it spent over $800,000 on repairing water infrastructure breaks last year – would have saved close to a half million dollars.
“It is foolish not to take a closer look,” he says.