Markham residents likely to see water rate increase of 3.8% on top of 6.4% tax hike

Council expected to make decision Feb. 22 for new rate to be effective Apr. 1

Yorkregion.com
Feb. 21, 2023
Irene Wong

Markham residents could see an increase in fees for water and wastewater by 3.8 per cent, effective April 1, which cannot be said to be trivial as the city has already proposed a 6.4 per cent tax hike this year.

That said, members of the public did not speak at the public meeting held on Feb. 13 to allow public input for the proposed 2023 water rate.

On Jan. 7, city staff presented the report titled “2023 Water/Wastewater Rate” in the general committee meeting, which tabled an increase of the water and wastewater rate of $0.1774 to $4.7937 per cubic metre.

Based on statistics provided by city staff, a Markham household with an average consumption of 208 cubic metres per year will see a $36 increase on the water bill. For the top 10 institutional, commercial, industrial (ICI) customers, which includes manufacturers, office buildings and a retail plaza, the increase will range from $8,000 to $13,000 a year.

Markham’s water rate includes four components:

• Region’s wholesale rate -- the cost Markham pays to buy water from York Region;
• Non-revenue water -- the cost of water that is used but not billed to customers;
• Operating Expenditures -- funding needed to operate and maintain the water and wastewater systems;
• Reserve contribution -- funding used for long-term infrastructure rehabilitation and replacement.

For the wholesale rate, York Region has approved annual rate increases of 3.3 per cent from 2022 to 2027.

Based on the region’s wholesale rate increase and the results of this year’s reserve study update, city staff said Markham will require a water and wastewater rate increase of 3.4 per cent in 2023.

Markham water rate

However, the staff report also highlighted an additional component for Markham’s water rate this year, that is the reserve recovery requirement resulting from maintaining the 2020 and 2021 rate at the 2019 level.

In response to the COVID-19 pandemic, the city and region provided rate relief by deferring the scheduled increases for 2020 and 2021. As a result, the city’s reserve study completed in 2021 was showing an additional shortfall at the end of 25 years.

The previous council approved a four-year phase in of an incremental rate increase for the reserve recovery, starting in 2023 at a rate of $0.0196 per cubic metre or 0.4 per cent.

As a result, an overall rate increases of 3.8 per cent has been recommended, including both the base rate increase of 3.4 per cent and the reserve recovery phase in of 0.4 per cent.

Council will make the decision on Feb. 22 and the new rate would be effective April 1.