In 2012, the average consumer in Orangeville will face an 8.2 per cent increase in their water and wastewater rates, meaning rates have increased almost 25 per cent over the last three years.

What should provide a modicum of relief is that future increases likely won’t be that steep.

A water and wastewater rate study commissioned by the town in 2010 has projected what increases will be necessary until 2019.

The study’s authors, Watson and Associates Economists Ltd., forecast an 8.3% rise in 2013. But then the increases will drop slightly, to 7.4% in 2014, and after that, hikes are expected to drop sharply to 4.2% in 2015, to 3.6% in 2016, and even out at 2.6% from 2017 through to 2019.

The cause of the recent steep increases is attributed to provincial legislation that requires a municipality to operate its water and sewage treatment facilities self-sufficiently.

This means that the town, for example, cannot draw from the tax levy to fund its water plants. It must rely on monies from water user rates or, in some cases, development charges.

Doug Jones, Orangeville’s managing director of environmental and development services, says the Watson figures will be up for review in 2014.

Barring the unforeseen, however, Mr. Jones is reasonably confident that the forecast numbers should not change to any significant degree. “At this point, I see no reason to believe we will be in for any kind of shock,” he said in an interview.

In 2012, the “fixed portion,” or basic rate, of a water bill will be $12.78 per month. After that, the user will be charged $3.19 per cubic metre.

The average user in Orangeville consumes about 230 cubic metres per year.

The Town has adopted a system wherein it calculates the operating and capital, as well as “life cycle” costs of maintaining its sewage and water infrastructure.

Life cycle costs involve predictions on how long things, such as a length of sewer pipe, can last before they need to be replaced. The key is to set aside in money in reserve to pay for the replacement when that time comes.

Public works director Jack Tupling concurs with Mr. Jones that things are going according to plan.

“As long as we keep making contributions to reserves, we’ll have a reason to say we’re on target and there should be no reason to say we won’t have the money.”

With sufficient reserves, the pressure on rate increases will decrease.

Several large water infrastructure projects have either been completed or are well under way. They include William, Parsons and Zina Streets, as well as the South Park and Village Green subdivisions.

User rates have also been used to finance upgrades at the pollution control plant, which are in the process of being finished. As well, costs associated with the actual expansion of the plant can legally be covered by development charges (DCs).

To explain how DCs enter the equation, Mr. Tupling used the plant’s inlet works – where wastewater first enters the plant – as an example.

The inlet works’ filtration screen system, first constructed in the 1960s, has had work done to modernize it. This is considered a capital upgrade and can only be funded through user charges.

On the other hand, the plant is expanding to accommodate anticipated population growth and there are plans to increase the size of the filtration screen, accordingly.

Since the larger size is directly related to expansion, part of the cost can be borne by DCs.