Sewer pact links city and PIB

By JOHN MOORHOUSETuesday, April 22, 2008 Penticton Herald

In what is being hailed as an “historic agreement,” the City of Penticton has agreed to provide sewage treatment service to the Penticton Indian Reserve. The 25-year agreement was endorsed by city council Monday, after being approved by the band council last week. A signing ceremony will be held at a later date. The city agrees to provide sewage treatment for band lands on the west side of the Okanagan River Channel, with connections at Green Avenue and Green Mountain Road. The service extension is contingent on completion of the city‘s planned $27-million sewer system expansion. Work is expected to begin this fall and be completed by late 2009 or early 2010. A funding formula will be worked out to determine how much the band will contribute towards the upgrade. The city and band are applying for senior government funding for the project. City administrator Leo den Boer said the city may have to decide whether to delay construction of some portions of the sewer system upgrade to allow time for the grant applications to proceed. He noted once construction begins, a project is no longer eligible for senior government funding. Grand Chief Stewart Phillip said Monday the sewer agreement opens the door to the Penticton band‘s long-standing economic development plans.

Any sewer line extension at Green Avenue will be along a proposed bridge to band lands at that location. The city will pay the initial $1-million dollar cost of sewer line connection points at Green Avenue and Green Mountain Road, increasing the capacity of three pumps, including the Lee Avenue lift station plus extra electrical costs. This will later be recovered from the band either in a lump sum or amortized with interest over a 20-year period. The city will recover all operating expenses for the sewer line extension, including overhead and a 10 per cent profit margin. The band will provide a $50,000 letter of credit as security prior to the construction of the connection lines to the reserve. “We‘re not subsidizing them in any way. They‘re paying their fair share of the costs here,” said den Boer. “The actual fees and charges we will be charging the PIB includes the cost of those capital improvements, and the depreciation and so on.” The sewage agreement marks the successful completion of four years of negotiations between the band and the city, including three months of “serious negotiating sessions” since January. “It‘s not just public platitudes and warm fuzzy statements, but a tangible concrete result that will benefit the entire region by helping to diversify the economy, preserve the water and safeguard the environment,” said Phillip. Kimberley noted it could lead to other mutually beneficial endeavours in the future. The Penticton Indian Band Development Corp. is currently working on a comprehensive community plan and economic development strategy. The city has little developable land available, especially for industrial purposes.
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Don Quixote Note: It looks like the City of Penticton has considered that they will lose a grant opportunity if they begin construction on a major project. This deal for the extension of a major pipeline source (whether sewer , water or reclaimed water) has been negotiated with a built in profit included and ultimately will benefit the existing taxpayers by potentially opening up a scarce commodity, namely industrial land. Penticton looks like they will get all their ducks in a row before proceeding with a major project!