Done

Council approves next phase of waterworks expansion 7-6

County council approved tenders for water and wastewater lines under the Millennium Trail in Wellington last week. The project will cost more than $20 million. Council also approved, by implication, a new wastewater pumping station estimated to cost about $6 million.

It likely means a couple of years of disruption to the Millennium Trail as contractors burrow— in some places—20 feet under the former rail bed to install pipes. A portion of Main Street between Consecon Street and Prince Edward Drive will also be closed—likely for months—to install pipes to the plants.

The vote was close, 7-6. It was so close the meeting had to be adjourned for a few moments to rustle an Ameliasburgh councillor, participating by Zoom, to be reconnected for the vote. Had that effort fallen short, the vote would have lost on a tie.

As such, the awarding of the trunk lines passed, but with an amendment calling for a third-party review of the project. The finances, the assumptions of development growth, and commercial development will all go under the microscope—before the new water and wastewater plants proceed.

It may prove pivotal.

Council has, to date, committed more than $44 million toward expanding waterworks in Wellington to accommodate new homebuilding on the farm fields north of the Millennium Trail. It has received just $4 million from the developer by way of Letters of Credit.

Residents, businesses and a former council member are increasingly worried that Shire Hall has over-committed to this developer, that if hundreds of new homebuyers don’t show up, existing water ratepayers across the County will have to fund this debt through their water bills—already among the highest in the province.

These worries have prompted the Wellington Community Association to advocate for ratepayers here and elsewhere in the County. The WCA retained Andrew Biggart, a lawyer with Ritchie, Ketcheson, Hart and Biggart. Biggart is an expert in development charges law and related matters. He represents most of the cities in the GTA and beyond.

He argued before council on Wednesday night that it was taking on too much risk with virtually no certainty of it getting repaid.

“The County is being led down a path by its staff in which the County will incur the front-ending costs with the hope and expectation that such costs will be recovered at some future date,” explained Biggart. “ This is an irresponsible use of County funds; it is irresponsible to incur costs when you have no certainty of recovering the costs, and it is irresponsible to place this financial burden upon the existing ratepayers of the County.”

He added that the upfront agreements between the County and the developer provide no requirement for the developer to sign a subdivision agreement that would trigger the payment of development charges under the agreement—nor a guarantee that it will do so.

Biggart also strongly disagreed with the contention that the municipality was bound by its agreement with the developer to proceed.

“You could pass a resolution tonight confirming that you are not proceeding, and the developers will get their security back,” explained Biggart. “It is that simple.”

It was not apparent that Biggart’s presentation had informed many councillors’ opinions.

Several repeated their view that Council was powerless to act—at risk of being sued by the developer.

“For hundreds of millions of dollars,” shouted a Picton councillor.

Others simply wanted to ensure there were no hiccups to the Base31 plans. The Picton developer is counting on water from Wellington running via a pipeline under the Millennium Trail to serve that project.

Senior leadership was largely silent on the points raised by Biggart. It was left to Peter Moyer, Director of Development Services, to explain the implications of pausing now. The new water tower was built in anticipation of new trunk lines, explained Moyer. And that existing water lines weren’t equipped to handle the pressure required to keep the tank full.

Reinforcing this capacity would fall entirely on the ratepayers, explained Moyer. But as it stands now, about 91 per cent of the waterworks expansion will be paid for by development, assured Moyer.

But who will pay the bill if 6,600 new residents don’t buy homes, or if a million square feet of commercial space isn’t built? Such worries are not in Moyer’s department. Council didn’t ask the question. Neither did it ask the director how far $44 million, committed to accommodate a developer, would have gone to maintain existing waterworks.

Wellington councillor Corey Engelsdorfer asked if staff had followed up on the former council member’s suggestion in November that the County tie the awarding of the tender to the payment of the developer’s development charges payable.

“If the developer has every intention of building, I don’t see why that couldn’t happen. Did those discussions take place?” asked Engelsdorfer.

Moyer confirmed that discussions had taken place, but said the developer needed assurance the pumping station was going to get approved.

“It’s difficult for a developer to sign a subdivision agreement when the pumping station hasn’t been approved,” said Moyer.

A new water tower, an equalization tank, a stack of studies and reports, and now trunk lines across the village are insufficient to demonstrate the County’s good faith to the developer. The risks must all be borne by existing water ratepayers.

When the vote came, councillors Engelsdorfer, Braney, Nieman, Harrison, Pennell and Prinzen voted against the trunk line. Mayor Ferguson and councillors Maynard, St-Jean, Roberts, McNaughton, Hirsch and Grosso voted to approve. Councillor Branderhorst was absent.

A SECOND LOOK

While Council approved the trunk line tender last week, it also agreed to a third-party review of the project—the costs to date, the projected costs going forward and the assumptions driving the project—before new water and wastewater plants are designed and tendered.

Nearly a third of the development charges expected to fund the Wellington waterworks expansion is targeted to come from commercial development—927,000 square feet (about six Costcos) being built in the village. At a development charge rate more than ten times higher than any other part of the County. Much higher than any neighbouring jurisdiction.

Most observers and industry professionals agree that it is highly unlikely that even a tiny fraction of the projected commercial development will occur in Wellington under these circumstances in the next two decades.

Watson and Associates—the economic consultant the County employs to model water rates and development charges— presented a top-down assessment of growth in the region last fall. Their findings suggest new homebuilding will not occur at the anticipated rate for Wellington’s waterworks expansion.

If thousands of folks don’t come, and a million square feet of non-residential aren’t built to support them, existing water ratepayers are on the hook to fund this expansion through their water bills.

Others say that Wellington’s plants are not at the end of their life—that they were built using a modular and efficient design, and that ongoing maintenance and upkeep will ensure they serve the village for decades still.

Yet others say that warnings that the plants are near the limits of their capacity are overstated, especially since the addition of the wastewater equalization— which now alleviates the risk of heavy rain events that have tested the plants’ capacity in the past.

Each of these questions may now be tested and verified.

Councillor John Hirsch proposed the following amendment prior to voting in favour of awarding of the trunk line.

‘ “A review of the master servicing plan, the development charges background study, growth forecasts, project scope and financing against current economic and environmental assumptions before the water and wastewater plants are tendered,” said Hirsch.

CAO Marcia Wallace confirmed such a “second look” would require a third party, that she take Council’s direction and would prepare a scoping document and a budget and bring that back for approval.