Fredericton council adjusts water rate hikes for 2018

Fredericton city council has tentatively approved new increases to water rates for 2018. 

Alicia Keating, the assistant director of finance, innovation and technology, presented the recommended adjustments to the rates at the water and sewer budget meeting.

The original plan was to increase only the quarterly service charge, which is a flat rate. After the council meeting Monday,  however, the quarterly increase has been reduced and the consumption rate will also go up. 

The suggestion was that customers can still save money by conserving water. 

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"Council asked … to be able to meet our long-term infrastructure renewal and keep a rate increase reasonable by taking a rate that would be appropriate to achieving both those goals and spreading it over our customer base more equitably," said Coun. Greg Ericson, also the finance committee chair. 

"So what city staff have come back with is what turns into a four per cent annual revenue increase for water and sewer but translates into a smaller increase for our residential customers than was originally proposed."

The quarterly service charge of $102.98 will climb to $107.98, and the consumption rate will go from $1.68 per cubic metre to $1.78.

The original plan would have seen the fixed service charge increase by $13.06 each quarter, with no increases to the consumption rate.

If approved with the rest of the 2018 budget in December, the new rates would take effect in the second quarter of the new year.

While this will be the same revenue increase for the water and sewer department, it will be a small burden on residential customers, said Ericson. 

"We heard from council at our first meeting, and as we worked to produce what we've done tonight, is that they're very concerned with the burden of increased revenue on their constituents," said Ericson. 

"I think we've made good progress tonight achieving those ends."

The additional money from changes to the rates will be used to upgrade "rapidly aging" infrastructure, which Keating highlighted in a report to council in September.

The utility has to generate its own revenue for the repairs, but it doesn't have the revenue to do so, partly because residents have been more frugal with their water use.