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This article was published 26/4/2016 (1607 days ago), so information in it may no longer be current.

A number of Winnipeg city councillors are hoping to postpone a hefty increase in water and sewer rates.

Couns. Jason Schreyer and Russ Wyatt are moving a motion at Wednesday's council meeting, calling for the rate increases to be subject to hearings by the Public Utilities Board.

Schreyer (Elmwood-East Kildonan) and Wyatt (Transcona) said a large portion of the water and sewer rate revenues are being used to balance the city's budget, which they said undermines the purpose of those rates.

"When I ran for office in 2014, I told people property taxes would have to increase to pay for our infrastructure and streets and they were OK with that," Schreyer said when explaining why he is bringing the motion to council. "Finding tax revenue through water and sewer rates is not equitable and it's not fair. I didn't campaign for that and I can't support it."

City council will vote on a series of water and sewer rate increases at its Wednesday meeting that will see annual percentage increases on the quarterly residential water bill for this year and the next two years of 9.2 per cent, 8.9 per cent, and 7.4 per cent. The increases have already been endorsed by Mayor Brian Bowman and members of his executive policy committee.

But Schreyer and Wyatt want council to have the increases reviewed by the PUB. Winnipeg, they said, is the only municipality in the province that is allowed to set its own water and sewer rates and to allow a portion of those rates to be used to balance the budget.

"What gives Winnipeg a monopoly on wisdom when it comes to setting water and sewer rates, compared to all other municipalities?" Wyatt said, adding he believes neither council nor the CAO's office is providing the proper oversight on the water and waste department.

Wyatt said he's suspicious of the plans, and associated costs, the water and waste department is proposing for upgrades to the water and sewage treatment plants, but said a majority of council is not prepared to challenge department officials.

"Project management in the department is horrendous," Wyatt said. "We've had cost overruns on project after project. We had one lawsuit dismissed and another is outstanding. The department has been operating like its own separate fiefdom and those days should be over."

The administration justifies the rate increases as necessary to cover the operating costs of the water and waste department and to build up the reserves needed for upgrades to the city's water and sewage treatment plants. But a portion of those revenues — 12 per cent — is also being diverted every year to balance the city budget.

The city expects to collect $319 million from water and sewer rates this year, with $32.1 million diverted to balance the budget this year, which it labels a dividend. Over three years, the city will use $106 million from water and sewer rates to balance the budget.

Winnipeg is the only municipality in the province allowed to set its own water and sewer rates. It is also the only municipality allowed to use any portion of the revenue collected through those rates to balance its budget.

Bowman has defended the move, saying the city needs to rely on a variety of sources — property taxes, a portion of water and sewer rates, frontage levies, fees — to balance the budget. Bowman said city council was open about where it was finding its funds. Until the province provides municipalities with alternative sources of revenue, he said he expected city hall would continue raising needed funds in this way.

Getting the PUB involved in oversight and setting of water and sewer rates is not a new idea. Former mayor Sam Katz promised in 2009 to have the PUB regulate a proposed city-owned water and sewer utility. The PUB supported the move, with a comprehensive report in May 2012 following two days of hearings in December 2011.

But when the independent utility never materialized, support at city hall for PUB regulation disappeared.

The PUB's 2012 report concluded Winnipeg was over charging its residents by 20 per cent on its water and sewer bills.

Darren Christle, executive director of the PUB, said the current position of the board, that Winnipeg should not be allowed to set its own water and sewer rates and that no part of the money raised by those rates should be used to balance the city budget, has not changed.

"The policy is that the system should be paying for itself — it's not meant to be a revenue generator," Christle said.

Christle said it needs to be asked why city hall is imposing water and sewer rates that generate more money than is needed to run the system.

"That's not cost recovery," Christle said.

Christle said the province was unwilling in 2012 to implement the board's recommendations, which included removing Winnipeg's exemption from PUB jurisdiction.

The PUB has the authority to review Winnipeg's water and waste department, he said, which it did in 2011, and it is willing to do so again if requested. But the PUB cannot "order" either Winnipeg or the province to implement those 2012 recommendations or new recommendations until the exemption is removed, he said.

Schreyer said he believes he has support of at least one third of council (five councillors including himself) for his motion and hopes to convince four more during the debate. Even if it fails, it's not an issue that will be forgotten, he said.

"The public knows that this is not right. We should not be using water and sewer rates to pay for the city budget," Schreyer said. "That money needs to stay with the utility."

aldo.santin@freepress.mb.ca