Kingston's Infrastructure and the Challenges of the Capital Budget

[keoadmin]

Kingston's Infrastructure and the Challenges of the Capital Budget

Article by Nancy Foster, with notes from Richard Tindal

Investment in infrastructure is needed to provide new services that will support economic growth and to maintain and replace existing infrastructure that needs upgrading. It is the latter problem that especially confronts the City of Kingston.

Impending Infrastructure Obligations

Project / Timing / Cost

King West Water Tower / Current / $2.5 million

Downtown Sewer and Watermain replacement / 2004-2005 /Estimate not available

Harbourfront Trunk Sewer / 2004-2006 / $6 million

Secondary Treatment Facility at Ravensview / 2004-2006 / $80 million

Twinning of sewer from River Street pumping station / Underway, 2003 - 2006 / $17.6 million

Road construction and maintenance /Annual / $10-$18 million

Urban Growth Report / Varied, as are growth options / To come

The Draft Transportation report examines Kingston annual expenditure ($10 - $12 million) on roads and pronounces it inadequate. To fully maintain current roads, the figure, says the report, should be around $18 million per year. In addition the report strongly recommends a third crossing of the Cataraqui River -- $32 million.

The final Urban Growth Report will detail costs associated with the various growth options that are presented.

Since 1999 user fees have paid sewer and water infrastructure costs. This is not to say that the fees are directly levied according to costs. The total cost to users depends on the support for infrastructure projects given by provincial and federal levels of government. Federal commitment to the Ravensview project will be $25 million.

The Amalgamation Agreement calls for the burden of upgrades to fall on those they benefit -- in this case of the major sewer and water projects -- the East and Central City. This would not apply to the third crossing, as transportation services were not included in the area specific requirements of the agreement.

Between 30% and 50% of the capital budget costs fall directly on the municipal taxpayer through fees or taxes. A recent city publication asserts that ‘funding to municipalities from senior levels of government has decreased from 22.9% to 17.9% of total municipal revenues.’ The province disputes these numbers

Cities do not depreciate their assets so there is no automatic reserve for replacing worn out assets. This means that a council can postpone making necessary investments in infrastructure without this decision showing up in the books as an increased liability facing the municipality. As a result, councils have had less incentive to recognize every year the real costs that are accumulating -- in the form of aging infrastructure -- and to put money aside to replace this infrastructure.

However, since 1999, Kingston councils have been contributing on an annual basis to a reserve fund, which will be used for replacing existing assets. The financial plan calls for a 1% annual incremental contribution to tax supported capital reserve fund. (1% = approx $1 million). Repairs and maintenance are part of the Operating Budget.

While the initiatives mentioned above are welcome, they are far from sufficient. The other sources of revenue for capital financing potentially available to the city include:

~ Provincial and federal grants which are no longer as plentiful, are uncertain, and tend to fluctuate with the priorities of other levels of government;

~ Development charges arising from new growth and development in the city;

~ Expanded user fees, subject to various limits imposed in the Municipal Act;

~ Long term borrowing;

~ Private capital that might be accessed as part of public/private partnerships;

~ Donations from the community in support of particular capital projects.

Recent Councils have tried to keep tax increases approximately at the level of inflation. During the high inflation years of the 70s this was not the case and one could argue that we are paying the price now -- or one could argue that inflation is the wrong benchmark for tax increases.

Attitudes to this mountain of capital costs vary. Some view the projects as optional. Some view them as unavoidable. All view the senior levels of government as a necessary but unreliable source of funding. Long-term solutions will surely involve a lessening of reliance on the residential tax base.

Readers may wish to view the platforms of the provincial candidates on the subject of aid to municipalities found elsewhere on this site.

It is important for the future of the city that candidates for council and mayor demonstrate a solid understanding of these issues and a commitment to make the tough political decisions that will be required to provide for this infrastructure and to pay for it.

It is hard to see how the city can meet its capital obligations without undertaking more long-term borrowing and raising taxes and user fees.

[nstn]

After seeing the disruption caused by a relatively small water leak it certainly drives home the need for basic maintenance and improvements to the city's key infrastructure.

Maintenance of our major city infrastruture systems deserves a higher priority than all but the basic maintenance needs of the Memorial Centre.

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East end water cut as crews fix leaky pipe

By Terri Coles

Wednesday, January 21, 2004 - 07:00

Local News - Kingston’s military base and 2,000 east-end households were ordered to ration water yesterday as utilities workers completed repairs to a major water main.

Utilities Kingston also asked drivers to avoid the intersection of Cataraqui and Rideau streets today.

The repair work involves a leaky main, which has taken weeks to locate and is buried beneath the intersection.

Cataraqui Street east of Rideau is expected to be closed periodically as workers clean up after last night’s work, said Jim Keech, CEO of Utilities Kingston.

Cataraqui was closed yesterday afternoon and traffic rerouted as workers prepared finally to fix the problem, which was discovered about three weeks ago, said Jeff Taylor, foreman of the Utilities Kingston crew working at the intersection.

Finding the source of the leak was a time-consuming process of elimination, Taylor said.

Several times during the past weeks, crews cracked open the pavement in their search for the source of the water that was bubbling up.

During last week’s cold snap, the leak created an icy cover on the stretch of Cataraqui Street that lies downhill from the intersection.

The intersection of Cataraqui and Rideau streets is congested underground, Keech said.

There are three water mains of different diameters – one of 15 centimetres, one of 40 centimetres and one of 50 centimetres – that service different areas of the city.

There is also a gas main running under the intersection, Keech said.

All three water mains had to be checked to find the source of the small outflow, which proved difficult to pinpoint.

Frost and cold weather caused equipment to break down, making the search even more difficult, Taylor said.

The leak was found yesterday morning in the seal on the main supplying Kingston’s east end, Keech said.

Even so, the repair work couldn’t begin right away.

“We had to take a step back and see who it affected,” Taylor said.

The 40-centimetre main was too large to repair safely without shutting off the water running through it, which would cut off the supply to the east end.

Taylor was underground yesterday afternoon, chipping away at years of buildup on the second of two old valves that he and his crew needed to get working in order to shut off the water before repairs started at 8 p.m.

Utilities Kingston issued an advisory, asking residents in city’s east end to conserve water until 6 a.m. today by avoiding unnecessary activities like washing dishes or clothes.

Steps were taken to make sure the water tower was full before repairs began.

That created a four-hour window for the repair workers to finish before east-end residents noticed a reduction in their water pressure, said Taylor.

Businesses on the lower portion of Cataraqui Street, including The Whig, will be open today and can be reached by the extension between Wellington Street and Cataraqui Street, which will be open if Cataraqui Street is closed.