Water charges draw criticism

Richard Rolke - Vernon Morning Star Published: May 15, 2010 12:00 PM

Greater Vernon’s water utility is being accused of hosing customers over rates. Director Gyula Kiss has reviewed the utility’s finances and says high water rates have led to $12 million being pumped into reserves. “This is not an indictment of anyone. There’s no finger-pointing here,” he said, adding that customers are being overcharged 22 cents per cubic metre. According to Kiss, the excess funds collected are over and above what’s needed to cover the financing of $35 million borrowed in 2004 for utility upgrades. “The way these huge reserves were accumulated is by initiating water rates,” he said. “This is a nightmare. Overcharging customers by $12,396,479 is unconscionable.”Kiss believes the decision to set money aside in reserves goes against policies set out by the utility when the public agreed to borrow the $35 million. “Why was the electorate not informed and given a chance to vote on the change,” he said, adding that a new financing method is needed where infrastructure is paid through taxation and utility operations are covered through rates based on water usage.

Chairman Wayne Lippert isn’t surprised that the utility’s direction has shifted since 2004. “Elected officials change and sometimes philosophies change,” he said. Lippert believes the goal has always been to set aside reserve funds to reduce the burden of increased operating costs for the Duteau Creek treatment plant and other upgrades that may be needed.“The master plan’s expectation was $90 to $100 million (in total project costs) and the idea was to build up reserves,” he said.