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Published - Nov 4th, 2009
By Scott Nixon
SOUTH HURON — The municipality and Grand Cove Estates continue to disagree about water and wastewater rates.
As previously reported, many Grand Cove residents are concerned about the fact they face increased rent as a result of South Huron's new water/wastewater rates. A lengthy discussion was held at Monday night's council meeting during which staff, council, residents and a lawyer for Grand Cove spoke.
In the end, council made no decision on how to deal with Grand Cove, instead deferring the matter and awaiting advice from the municipality's lawyer.
Nearly 100 Grand Cove residents attended a council meeting in September protesting the new rates.
The new rates came into effect Jan. 1, 2009.
Before those rates came into effect, the entire Grand Cove property was charged one base fee of $43 per quarter plus 57 cents per cubic metre. After the new rates were implemented, the nearly 400 units in Grand Cove have each been charged the new base fee, cubic metre charge and debt retirement fee. Land lease properties such as Grand Cove are billed the same fees as single unit dwellings in South Huron.
Those fees in Stephen are a quarterly $60.70 base charge, a $4.80 debt charge for the Lake Huron pipeline and a consumption charge of $1.53 per cubic metre of water used. The sewage rate is 57 cents per cubic metre plus a quarterly base charge of $20.20.
In Grand Cove, the individual homeowners don't receive water bills, the owner of Grand Cove does.
The base fee for each Grand Cove unit seems to be the major sticking point.
Bruce Murray, president of the Grand Cove Estates Homeowners Association, said residents face an approximate monthly rent increase of about $30 due to the new rates.
But while the water rates have increased, Murray said service hasn't, and he pointed out Grand Cove owns and maintains the infrastructure within the development, not the municipality.
He added many Grand Cove residents are on fixed incomes and can't afford the increase. Tyler Hortie, a lawyer with Cohen Highley LLP, hired by Grand Cove Estates echoed Murray's statement that Grand Cove maintains and operates its private water and sewage system. He said the real concern for the owner and the residents is that the base charges are for maintenance of infrastructure that the municipality doesn't maintain or own. By implementing charges for each unit in Grand Cove (386), Hortie said South Huron is charging for a service it doesn't provide. He later added Grand Cove's issue is not with the water consumption charge, but with the base charge.
He said the municipality's responsibilities end at the Grand Cove property line.
Hortie explained that the owner of Grand Cove is concerned the increase isn't justified and residents will be detrimentally affected by experiencing rent increases.
Hortie did add he believed the municipality didn't anticipate the impact on Grand Cove when it passed its water/wastewater bylaw, but gave South Huron three options on how to deal with Grand Cove: classify the property as an industrial/commercial/institutional property and charge Grand Cove based on the size of the pipe that enters the property; have a separate rate classification for land lease properties; or exempt Grand Cove from the bylaw and instead work out an applicable charge for water.
Hortie said he feels Grand Cove fell through the cracks when the bylaw was drawn up.
“It's a massive increase,” he said of the rates, and said it could put some residents out on the streets or in financial hardship.
Coun. Pete Armstrong said there is merit in Grand Cove's position regarding the base charge, but said, “the bill has to be paid.” However he did say since the municipality isn't fixing Grand Cove's pipes, “you deserve something back.”
Coun. Jim Dietrich pointed out that the base charge takes into account expenses for repairs within the entire water system, such as repairs going down Highway 21. Fire coverage also costs money, he said, adding everyone has the same bills and concerns.
Armstrong said the municipality could have opted to go with just a consumptive charge when determining its water rates. In such a case, he said residents would be paying close to $5 per cubic metre, as opposed to the current $1.53.
Mayor Ken Oke added the method the municipality decided on — using a base charge and a consumptive fee — provides cost certainty.
He also said Grand Cove's piping is a small item in the grand scheme of the water system and the base charges go towards maintaining the whole system.
Operations manager Don Giberson later agreed, saying South Huron's water system is “extensive” and the base charges are used to operate and maintain the entire system.
He pointed out Grand Cove residents aren't the only people impacted by the increased rates.
Giberson also refuted an earlier claim by Hortie that Grand Cove is unique in South Huron. He said there are other land lease properties in South Huron, such as Riverview Estates, with private infrastructure. However, in Riverview, each unit has its own water meter, unlike in Grand Cove, which has only one. Huron Park has public infrastructure, while there are mobile home developments with private infrastructure.
Giberson also said the rates Grand Cove was previously paying were way too low and part of the increase is “correcting the sins of the past.”
And while he conceded the new rates are a big increase, Giberson said Grand Cove is paying less in South Huron than it would if it were in Lambton Shores. In South Huron, Grand Cove's annual water bill amounts to $312,920.80; if Grand Cove were in Lambton Shores, its annual bill would be slightly higher at $317,707.36.
The difference is in how the municipalities charge for water — Lambton Shores relies more on a consumptive charge.
Giberson also revealed that it was discovered that Grand Cove's water meter was not working last year. It has since been replaced and the municipality is able to charge Grand Cove for water based on its consumption from the previous year.
Coun. David Frayne pointed out that there were public meetings when the municipality was discussing the new water rates last year and no concerns from Grand Cove were raised at the time.
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