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Town passes motion for water supply agreement with Collingwood

July 28, 2022   ·   0 Comments

Town of New Tecumseth Council passed a motion to execute the supply of water agreement between the Town of New Tecumseth and the Town of Collingwood during the Monday, July 25, Council meeting.

At the same time, the Town of Collingwood Council also recommended moving the draft agreement to the next stage at their July 25 meeting.

Currently the pipeline supplies 9,500 cubic metres of water daily to the Town of New

Tecumseth.

That will remain unchanged until a new water treatment plant is completed in Collingwood with an expected date of sometime in 2026.

The agreement will allow for an uninterrupted supply of water to New Tecumseth and for planned future growth in the town.

Collingwood’s 18.5 per cent ownership in the New Tecumseth pipeline will be sold to New Tecumseth for $6.5 million. New Tecumseth will contribute $7.5 million to a new Collingwood supply plan which will provide additional water capacity to both municipalities.

The Water Supply Agreement was originally created by the two towns in 1999. The agreement speaks to various aspects of the arrangement including the volume of water that will be provided.

At the time of that agreement, the volume provided was 6,000 cubic metres per day. Current usage has increased to 9,500 metres.

Since the time of the original agreement, both towns have experienced increased demand exceeding the capacity of the existing water treatment plant. The Water Supply Agreement expired in 2020, and the towns have continued to work in a collaborative effort under the terms of the original agreement.

The new agreement addresses the ownership of the former pipeline, the expansion of water capacity, and the cost and billing model of current and future water.

New Tecumseth’s owned capacity will expand from 6,000 metres to 13,400 metres upon expansion of the Collingwood water plant, and then to 23,500 metres by 2032.

The cost for Collingwood to expand their existing supply plant has been estimated to at approximately $121 million. The estimate is based on the preliminary design and includes approximately $30 million in contingencies.

Based on the percentage of the total volume required by New Tecumseth, the Town will be contributing their 61 per cent proportionate share of the expanded capacity with equates to a cost of $71 million.

New Tecumseth is permitted to continue to sell water to other municipalities.

As an ongoing commitment to environmental sustainability, both parties have agreed that neither party shall sell any water to third parties intending to bottle or sell water commercially.

A Joint Water Committee will be formed by the two municipalities to review issues and resolve disputes.

As development charge reserves are currently not available, the infrastructure will be funded through debt and the increase in supply charges will be incorporated into future water rates.

Town staff have reviewed rates at other municipalities and found the Collingwood rate to be reasonable.

An investment in the expansion of the Collingwood Supply Plant of $71 million is to be cash flowed with an initial deposit of $1 million and contributions equal to the progression of the construction over the next four years.

Much of the debt is intended to be funded through development charges with the remainder funded through taxation.

By Brian Lockhart

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