Hamilton ratepayers to pay additional 10% on water amid need to rebuild an aging system

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Hamilton ratepayers will be paying an additional 10.4 per cent to maintain water, wastewater and stormwater on their properties next year.

City councillors voted to approve what will be about an $88 per year bump on the average residential bill in 2024, with some of the cash earmarked for rebuilding an aging system of water and sewer infrastructure.

General manager of finance and corporate services Mike Zegarac says it could have been worse as original projections suggested a 20 per cent increase, which was eventually mitigated through savings and project deferrals.

“We identified approximately $46 million in capital savings that reduced the funding necessary for infrastructure for 2024,” Zegarac explained.

“We also deferred some capital projects, infrastructure projects at about $85 million because those projects weren’t ready to go in 2024. They’re still in that planning and environmental assessment state.”

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He went on to say staff were also able to find about $1.3 million in operating savings, while a “mayor’s directive” worked out a compromise between affordability for ratepayers and necessary investments for the overall water budget.

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Mayor Andrea Horwath characterized efforts to put the rate increase at 10 per cent as a “good signal” ahead of more difficult discussions to lower a projected 14 per cent property tax increase for taxpayers in 2024.

This is a good signal that we can find solutions, maybe not as fulsome as we want them to be in terms of impact to taxpayers and ratepayers, but certainly ones that balance all of the pressures to try to get us to a place that we can feel confident that we’ve done our best for the people of Hamilton,” Horwath said.

A 2022 asset management plan found that the city has historically been under-investing in its water mains, treatment plants and other infrastructure, to the tune of more than $100 million annually.

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An example of such work is the Dundas Wastewater Treatment Plant, which Hamilton’s director of water Nick Winters said “should have been replaced already” during a November committee meeting.

He notes that the city will be investing $15 million over the next two years, “just to keep that facility safe for our operators, and to ensure its continued functionality.”

Zegarac says ratepayers can expect another 10 per cent increase in their water bill for 2025, and likely every year beyond that for the next decade.

He says the municipality and ratepayers share in about $15 billion of water and wastewater assets and have to maintain those assets and grow services as the community grows.

“So that was one of the driving themes to the 2024 budget and will be in the future for 60 per cent of the rate increases going towards infrastructure (and) capital financing,” he said.

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