The right plan for Stayner and Clearview
The decision at our last Council meeting to commit $2.9 million to implement the first phase of the Stayner Wastewater Servicing Plan with Wasaga Beach is the most significant decision this Council will make.
I am satisfied it is the right plan for Stayner and Clearview. However, it’s understandable that some residents may question the size, timing and cost of the project given the protracted timelines over which the decision was made and the amount of detail involved.
By way of review, this plan is the consolidation of decisions made regarding infrastructure engineering, growth planning, regional partnerships and financing. These have been debated, reworked internally and in public consultation over the past eight years, and incorporated in the final plan approval in September 2010.
Much public discussion occurred during the environmental assessment (EA) process (from 2004 to 2009) in arriving at the preferred engineering alternative to connect to available treatment capacity in Wasaga Beach. An alternative to do nothing, or in other words, to use up all of Stayner’s existing capacity, was not acceptable at the time as housing development appeared imminent. Despite the current lack of building activity, modest growth at least is still a reasonable future expectation for Stayner, as evidenced by continued investments by the development community. Alternatives in which Clearview would proceed on its own proved more costly and less environmentally responsible. As for timing, proceeding with this plan now will position the Township to use spare treatment capacity to service industrial lands in Stayner, increasing the possibility of much-needed economic growth.
One of the most contested elements of the EA process was the determination of the ultimate population growth, required over 100 years to size and cost out the in-ground wastewater works. The concern expressed at the time and by some now is that the Township will commit to more infrastructure investment than it can afford by overestimating growth. The final population projections used were lowered significantly from initial full build-out estimates, and better reflect the current economic outlooks and our ability to finance the project through development charges (DCs), grants and debentures. Staged capacity purchases, described below, will also serve to further manage the risk in future residential growth investments.
While entering into a regional partnership with Wasaga Beach provides significant financial and environmental benefits, it does come with the risk that we have committed to proceed with some elements of the servicing plan on Wasaga’s schedule. As approved at the last Council meeting, the first payment of $616,000 to tie into the new Knox Road works was paid on December 1, 2012, and $2.3 million is due in July 2014. This decision was made with the expectation that upfront developer contribution through DC prepayment would be forthcoming. In the event that no prepayments were received, however, Council was prepared to fund this first phase through favourable interim debt financing, recoverable over time through DCs. The annual cost of debt repayment for the $616,000 is equivalent to the wastewater portion of two DCs, or two homes being built, and for the $2.3 million, the equivalent portion of 15 DCs, ensuring that these costs would be borne by development and not through property taxes or increased user fees.
Since Council’s decision to commit to the first phase, developers have committed to over $1 million in prepayments to date, with more expected over the next weeks. These prepayments are expected to both cover the initial payment of $616,000 and provide the option to pay down the current DC reserve deficit, thereby reducing even further the financial risk of the decision to proceed with the servicing plan.
While this servicing plan is a prudent and essential financial decision to secure growth in Stayner and is one with revenues attached, it must be said, in recognition of public concern, that some past investment decisions by this Council have called into question the Township’s funding priorities. In contrast to the investment in the joint emergency hub, which was neither essential nor timely and would have been best left to a future decision once growth had been realized and reserves were in hand, this recent decision to ensure future growth will not impact property taxes.
The phasing of the balance of the expenditures in the overall plan will help to further manage the financial risk by keeping it more in line with our actual growth. The next phase of the plan, $9.4 million for pipes and pumps to connect Stayner to Wasaga Beach, will proceed on Clearview’s timing to meet growth in Stayner. The decision to invest $4 million to service Stayner’s industrial lands will be made independently by the Township. Each of these phases will represent separate milestone budget decisions as growth opportunities justify and finances allow.
This plan provides for two capacity purchases of $6 million for 2,500 cubic metres per day of treatment, sufficient to support 2,200 new homes and 4,500 more people in Stayner. The first is a scheduled payment required by April 2017. The second treatment capacity purchase is growth dependent and not expected to be required until well beyond the current 25-year planning horizon.
Infrastructure grant funding from both the Provincial and the Federal governments is expected. These funds will be applied to the non-capacity related, growth discretionary components of this plan – the $9.4 million and $4 million phases.
So in summary, we have set in motion commitments to scheduled payments of $8.9 million and plans to proceed with $13.4 million in works as growth requires and funds allow. My expectation is that we will continue to exercise prudent control of this plan as we come to each milestone of this project.
This is a comprehensive decision, with much detail to review to fully understand its merit (or concerns). That’s why I had hoped we as a Council would have delayed this decision, past December 1 if necessary, until we had once again met with our residents to explain these details and the circumstances in which this decision is being made. We fell down on this obligation. However, we do have a public information meeting planned for early in the New Year to review this decision.
Contact me at email@example.com or 705-466-6321 for further details or comment.