Sewer system unaffordable without tax increase

System operating in a shortfall position and more money is needed

“The chickens have come home to roost,” and increases for sewer parcel taxes will be hitting Sooke property owners’ pocketbooks in 2013.

The increase would see the sewer parcel tax rise to $552 from the current $515.

Originally when the sewer system was first planned and went to referendum, the parcel tax was set at $495. It was intended to be self sufficient but that has not proven to be the case. The cash shortfall has been coming out of the General Fund. The amount which was borrowed from the General Fund is $588,459.65 at the end of 2011. Repayment to the General Fund has to be repaid at $118,000 per year for five years, resulting in a 7.1 per cent increase to the sewer parcel tax.

Acting CAO David Gawley, said at council on Oct. 22, that he could not explain the rising costs. He said the increase was suggested for a five-year term, and after five years the parcel tax would be closer to $515. He also stated that the original bylaw was approved for the Sewer Specified Area, not the entire population of Sooke.

He said for the balance of 2012 money will come from the DCC fund.

“We need to look at a new financial structure,” said Gawley.

Councillor Maja Tait said the revenue which had been projected was not there but felt the increase was too much.

“We need to explore other options… it’s too much for one year. It surprises me,” she said.

Coun. Bev Berger said that the district entered into a five-year agreement last year that they can’t afford and are “operating a system we can’t afford.”

Gawley said the numbers are there as was the obligation to pay the borrowed money back into the General Fund.

Mayor Wendal Milne said the payback could be spread out over a longer period of time thereby reducing the increase to the sewer parcel tax.

“The finance committee looked at this very carefully,” said Coun. Rick Kasper, chair of the Finance and Administration Committee. “The chickens have come home to roost. I don’t know what might happen, we are robbing Peter to pay Paul to run the sewer system. There was a huge increase in operating costs last year… and we’re bearing the brunt. Be honest with the taxpayer, this is the most viable thing to do.”

Mayor Milne said, “$118,000 is good news  in some ways, it is internal funds. It’s not a lot of good news but a little bit.”

Council passed the recommendation made by the F&A Committee to increase the Sewer Parcel tax rate to repay the Interfund loan. Coun. Tait was opposed.