Canada: Government moves to protect water systems for future generations

Expert panel to consult with stakeholders; provide advice on all aspects of water and wastewater treatment systems...

Aug 18th, 2004

QUEEN'S PARK, ON, Canada, Aug. 16, 2004 (CNW) -- The McGuinty government is taking further steps to ensure that municipal water and wastewater systems continue to provide safe, clean drinking water for Ontario residents by appointing an expert panel to advise on how to best manage these systems, Public
Infrastructure Renewal Minister David Caplan said today.

"The most important thing our government can do is to lay the groundwork now for safe and clean drinking water through the proper long-term management of Ontario's water and wastewater infrastructure," Public Infrastructure Renewal Minister David Caplan said. "I am pleased that Dr. Harry Swain has agreed to lead the Panel's work on this important issue."

The expert panel will consult with a variety of stakeholders, including municipalities, environmental organizations, plant operators, consumers and ratepayers, and business and industry groups. The panel has a mandate to provide advice on all aspects of organization, governance, investment, financing and pricing related to Ontario's water and wastewater systems.

"The work of the panel will help communities across Ontario upgrade and enhance their water systems to meet our government's tough environmental standards and protect human health," Minister of the Environment Leona
Dombrowsky said.

"We welcome opportunities to work with the provincial government on achieving practical solutions to financing water and wastewater systems in our communities that are affordable for consumers," said Association of
Municipalities of Ontario (AMO) President Ann Mulvale.

"Water issues have been a high priority in Ontario since the Walkerton tragedy in 2000," said Dr. Harry Swain, chair of the expert panel. "Jim Pine, Fred Lazar and I will work hard with all stakeholders. We aim to give the government the best possible advice on how to manage systems that deeply affect health and quality of life for all Ontarians."

"We are encouraged to see this welcome step forward," said Sam Morra, executive director of the Ontario Sewer and Watermain Contractors Association. "This committee's work will be important in ensuring that we address the province's water and sewer needs, both now and in the future."

Backgrounder
Long-term water and wastewater infrastructure investment and financing strategy

WHAT:
The Ministry of Public Infrastructure Renewal (PIR) is spearheading the development of a strategic water and wastewater infrastructure investment and financing plan to ensure the safety of Ontario's drinking water. In order to have the best research and information available, eight expert studies were commissioned by the ministry on a range of water and wastewater issues, which were completed in winter 2003. This work indicates that very large capital investments in our water and wastewater infrastructure are needed and will continue to be needed for a considerable period of time.

The next step in the plan is the creation of an expert panel to provide the government with advice on all aspects of organization, governance, investment, financing and pricing related to Ontario's water and wastewater systems. The Expert Panel is tasked with developing a solution that maintains public ownership, while ensuring that the investment needed to improve our water and wastewater infrastructure takes place, that water and wastewater systems are financially sustainable and that water rates are affordable.

The Panel will consult with a variety of stakeholders over the coming months, including individual, large and small municipalities, municipal and environmental organizations, plant operators, engineering and public works experts, economic and financial experts, business and industry groups, and consumer and user groups.

WHY:
The Walkerton crisis of 2000 highlighted the public health risks associated with the improper management of water and wastewater systems. Since then, the government has introduced strong new regulations to help ensure that our drinking water is clean and safe. The government has also made significant progress on Watershed-based Source Protection Planning and is moving forward on other initiatives that are linked to the protection of drinking water, including Places to Grow, greenbelt protection, Planning Act reform and the Provincial Policy Statement review.

The next step is to invest in the systems that treat and distribute water, and collect and treat wastewater. Changes are needed to make water and wastewater systems more financially sustainable.

In general, users are not paying the full amount that it actually costs municipalities to provide water and wastewater services on a sustainable basis. Limited funds are available for investment in rehabilitation, renovation and expansion. Some municipalities do not have the resources to invest in needed renewal; for others, the cost of making the improvements would make water too expensive. Multi-billion dollar capital investments are required for an extended period to bring distribution and treatment systems into a state of good repair and to allow for expansion.

During the next two decades, Ontario's population is forecast to grow by 40%. These people will all need water and sewer services as well as schools, hospitals, and roads.

The goal of a strategic and comprehensive approach to planning, managing and financing water and wastewater infrastructure is to ensure environmentally safe and clean drinking water for all Ontarians. The results, over the next decade, will be the creation of sustainable systems that will protect public health and allow communities to grow. The long-term water and wastewater investment and financing strategy will feed into the development of the government's 10-year public infrastructure plan.

WHO:
Dr. Harry Swain, Jim Pine and Professor Fred Lazar are the members of the expert panel. Swain was the Chair of the Walkerton Research Advisory Panel and is a frequent speaker on water provision and governance policy issues. He served as Deputy Minister of Industry and Deputy Minister of Indian Affairs and Northern Development for the Government of Canada. He holds a doctorate from the University of Minnesota and was awarded an honorary degree by the University of Victoria.

Pine is the chief administrative officer of the county of Hastings and a member of the Implementation Committee of the Expert Source Water Protection Committee, providing advice to the Ontario government on tools and approaches to implement watershed-based source protection planning. He brings broad experience of municipal management in a wide variety of municipal settings to the panel.

Lazar brings the perspective of an economist to the panel. He is associate professor of economics at York University and the Schulich School of Business. He has a doctorate from Harvard University. He has written extensively on a wide variety of economic policy issues, including water industry investment and regulation, and employment and trade.

WHEN:
The panel is expected to deliver its report to the government by end of the year, making recommendations on Ontario's Long-term Water and Wastewater Infrastructure Investment and Financing Strategy. The report will be released publicly.

Fact sheet

The Ontario government has appointed an Expert Panel to advise on how to make the investment needed to improve Ontario's water and wastewater infrastructure and on how to best organize and deliver water and wastewater services.

The overarching public policy goal is to ensure clean, safe drinking water for all Ontarians. The investment and financing strategy will play a key role in achieving this goal, in a manner that is consistent with continued public ownership and the recommendations of the O'Connor Report. The strategy will need to strike a balance between the objectives of financial sustainability, affordable rates, and achievability.

Ontario water sector statistics:
-- Multi-billion dollar capital investments in Ontario's water and wastewater systems will be required for an extended period of time to bring those systems into a good state of repair and to permit expansion
-- There are nearly 1,200 municipal water and wastewater plants in Ontario
-- Over 90% of Ontarians are served by municipal water and wastewater treatment systems
-- Ontario has a few large treatment plants and many small ones. Ten percent of all water plants provide 87% of Ontario's municipal water, and 10% of all wastewater treatment plants provide 84% of wastewater treatment
-- Municipalities with less than 2,000 people are nearly five times as expensive to service as communities with more than 100,000 people
-- Although there are variations across Ontario, an average household pays less than $50 per month for water services in almost two thirds of municipalities.

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