Penticton taxpayers may see a new levy on their tax bills in the coming years.
City Council received a report Tuesday from Urban Systems on establishing a dedicated funding source for stormwater infrastructure.
Penticton owns about $74 million worth of pipes, culverts and stormwater discharge structures. Ongoing operation and maintenance is estimated at $330,000 per year, and is funded through the city’s general revenue taxation fund.
“$330,000 is the average capital spend, and under the asset management work, the spend should be between $100,000 and $975,000 depending on risk tolerance,” said Interim CAO Mitch Moroziuk.
Moroziuk explained that the big difference between high and low is dependent on a couple of factors, including the life expectancy of the asset and the level of risk the city is willing to take.
“If you are willing to take on a higher risk tolerance, which means you say it is acceptable in certain conditions and certain locations for things to fail. That would reduce your expenditure,” said Moroziuk. “If you weren’t inclined to take that risk, you would increase that expenditure.”
Not keeping up with the stormwater needs could lead to flooding and road damage, increasing in probability as time passes.
“You are leaving a problem for other generations,” said Cory Sevill of Urban Systems. “Thinking about it now is more beneficial.”
Sevill said they reviewed how nine other communities were dealing with stormwater funding, and found that charges ranged from a $100 yearly charge to a high of $400 annually by the City of White Rock.
Sevill said Penticton taxpayers are currently paying about $20 per year through their property taxes.
“A lot of time, storm water is forgotten about, so not enough is being spent on it,” said Sevill.
The Urban Systems report suggest four ways to create more funding for stormwater infrastructure, but the main recommendation was to create a property tax based on usage class, with a connection charge for users connected to the system, paid into a dedicated reserve fund.
Moroziuk said staff started this process because they really wanted to develop a dedicated fund.
“It’s not like our water utility or our sewer utility. The money is always competing for all the other uses in the general fund,” said Moroziuk. “How are you going to fund the assets you already have that are getting old? Part of it is going to have to be used for that. Part of it is going to look at extensions that are needed to the stormwater system.”
Mayor Andrew Jakubeit said the recommendations contained in the report would be discussed during the budget process coming up at the end of January.