The Town of Gibsons plans to be around for a very long time; and to provide water to its residents, businesses, and industries for a very long time. Now, with a bit of help from Econics’ WaterWorth™ tools, they are well on their way to doing just that.
It all began in 2013 when during a routine rate review staff realized the Town was somewhat dependent on grants to fund their water and wastewater utilities. Considering that grants are increasingly unavailable and unreliable, and that water services are so integral to a community, this caused them considerable concern.
“Just as you can’t plan your household budget based on the hope of an inheritance or a lottery win, our municipality needs to deal within its available resources,” says Wayne Rowe, Mayor of the Town of Gibsons.
So staff approached Econics for advice. Together, we developed an infrastructure replacement schedule, determined the annual cost of sustainable ownership, and established a long-term financial plan that included the annual cost for asset replacement (ACFAR) and recommended rate increases. We also prepared a communications plan to help residents understand this important work, how it might affect them, and the need for change.
With the full support of Council, water and sanitary sewer revenues have increased by about 10% for 2014 and will likely continue to increase modestly over the next few years. Now that there is a clear plan to achieve revenue sufficiency for their utilities, the Town is working with Econics to adjust their rate structures to optimize equity between and within customer groups.
“In 2010 the Town of Gibsons embarked on a universal water metering program and after two successive years of deficits, it was clear we needed expert assistance. Econics was able to assess our situation and provide technical expertise that was easy to convey to Council,” says Ian Poole, Director of Finance with the Town. “The concept of ACFAR has now become standard language in our budget discussions. Econics have given staff and Council the tools and confidence needed to pursue rate increases to put Gibsons on a path towards long-term sustainability.”