Taxes for city residents could be on the rise if Powell River does not receive help paying for major infrastructure. The tax increase amount depends on how much money provincial and federal governments can provide to help pay for projects such as replacing the Haslam Lake water main.
City of Powell River’s water system is supplied through a 1.3 kilometre, 36-inch concrete water main running from Haslam Lake to the city’s water treatment plant and reservoir at the top of Haslam Street, near Cranberry Lake.
“That water main is our priority,” said councillor Russell Brewer. “If we don’t get the grant funding, we’re probably going to have to borrow the money to do it.”
Built in the late 1950s, the low-pressure induction line has already exceeded its 50-year design lifespan and does not meet seismic resiliency standards, said city director of infrastructure Tor Birtig.
The city, looking for two-thirds funding for the $4.2-million project, applied to the first round of the New Building Canada Small Communities Fund in 2015. Although the fund is specifically for projects such as this, the city’s application was denied. Supported by the BC and federal governments, the fund provided $128 million to 55 communities.
City of Powell River resubmitted its application in April for the second round of the fund. A decision is not expected until fall, but city staff are already working on alternative plans if it is denied again, said Birtig.
“We’ve held off long enough and we’ve stated it’s a high priority for the city,” he said. “We couldn’t be serious if we just said we would wait for the next grant opportunity to come.”
Birtig said the water-main replacement is necessary and if denied again the city will have to “borrow the funding to get the project done.”
Even if the city wins the grant, the project could have a price tag of well over $1.5 million, depending on how much of the project the grant covers and which replacement or upgrade option is chosen.
Staff will ask engineering firms to provide proposals that include a replacement of the line, twinning the line by adding another main and creating redundancy or upgrading the current main by slip-lining it with a newer pipe.
While the main has outlived its design lifespan, the bigger threat comes from potential failures due to large earthquakes, he said.
“It’s not going to deteriorate to the point where there’s no concrete left,” said Birtig. “The bigger issue is if we get a large earthquake, we’re going to have significant issues.”
The line is buried under swampy ground and standing water, making it difficult to access and even harder to assess where potential breaks may be located, he said.
In addition to residential and business supply, the main provides water for firefighting, he added.
According to Jeremy Sagebiel, engineering technologist project manager for the city, if the trunk main broke during the winter and water rationing measures were not implemented, the city would have less than three days of water supply, and less than 24 hours in the summer if there were not any significant fires to put out.
“You put a fire in there and you’re cutting supply down to a third at best, depending on the size of fire,” said Sagebiel. “If the main was to fail we would have to get pretty aggressive in conserving water to extend that.”
Of all the city’s aging infrastructure, the Haslam water-main replacement has the highest priority, according to Birtig.
“There’s serious money with infrastructure that is required,” said Birtig. “We’re trying to maintain the systems, but now they are getting older and it costs a lot of money to put in a water main, sewer system or sewer plant or reservoir.”
Birtig said the city is facing chronic annual funding shortages for infrastructure of about $4.5 million for current maintenance of buildings, roads, sewers and water system, but his department is doing its best to work with the resources it has.
“It’s all going to come due at some point, but the most significant ones are the water trunk main,” he said.
Council agreed to provide $600,000 of federal gas tax annually to maintain roads and start addressing some of the ones in worst repair.
The water system, with the exception of the trunk-main replacement, is almost self-sufficient from city water tax.
Buildings are another story, including Powell River Recreation Complex, which is now 40 years old.
Brewer said the infrastructure gap will not be closed without significant tax increases or the city either having to sell assets or get out of providing some services.
“There’s been a huge shift from major industry to residential and business tax classes,” said Brewer.
The city has applied to the province for financial help to pay an estimated $25 to $30 million for the liquid waste management treatment facility, but city council is not eager to rush out to borrow any money for that just yet, said Brewer.
“Not when we’ve got all these other projects and services people are asking for,” he said.
Birtig said while he was growing up in Powell River during the 1960s and 1970s it was a very wealthy town due in large part to taxes paid by the mill.
“Powell River had a great corporate citizen in [previous mill owner] MacMillan Bloedel,” he said. “Now we have to penny pinch and get wise.”
Since 2008, the city has provided Catalyst Paper Corporation with a tax break to help the struggling company.
According to Fred Chinn, Powell River operations manager for Catalyst, the mill continues to be a major contributor to Powell River, through providing almost 400 jobs and contributing $41 million in annual wages and benefits, as well as close to 2,000 indirect jobs and a regional economic impact estimated at $400 million.
“Catalyst is focused on improving its performance and transforming for the future. We continue to look for ways to reduce costs, diversify our product mix and develop new products in niche markets with growth prospects,” said Chinn. “As we pursue our change agenda, continued cooperation between Catalyst and the City of Powell River is vitally important to ensure long-term, mutual sustainability and economic stability.”
