Halifax Water 2013 Rate Increase Application

Application for the Approval of a Schedule of Rates and Charges and Schedule of Rules and Regulations for the
Delivery of Water, Wastewater and Stormwater Services

MATTER NO. M05463
January 9, 2013
Nova Scotia Utility and Review Board
IN THE MATTER OF: - and -
Public Utilities Act
IN THE MATTER OF: The Application by the Halifax Regional Water Commission for Approval of a Schedule of Rates and Charges and Approval of Regulations Respecting Rates and Charges for the provision of water, public and private fire protection, wastewater and stormwater services
SUBMISSION IN SUPPORT OF AN APPLICATION BY THE HALIFAX REGIONAL WATER COMMISSION FOR AN ORDER APPROVING A SCHEDULE OF RATES AND CHARGES FOR THE SUPPLY OF WATER, WASTEWATER AND STORMWATER SERVICES AND APPROVAL OF THE SCHEDULE OF RULES AND REGULATIONS FOR WATER, WASTEWATER, AND STORMWATER SERVICES
JANUARY 2013
January 9, 2013
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Contents
NOTICE OF APPLICATION ....................................................................................................... 3 Background to this Application ................................................................................................... 5
Cost of Service Rate Design ............................................................................. 6 Integrated Resource Plan .................................................................................. 7 Debt Strategy .................................................................................................... 8 Five Year Business Plan ................................................................................. 10 Revenues ........................................................................................................ 11 Consumption................................................................................................ 11 Expenses ........................................................................................................ 12 Salaries and Benefits ................................................................................... 12 Electricity and Fuel ...................................................................................... 13 Debt Financing............................................................................................. 13 Depreciation................................................................................................. 13 Chemical Costs............................................................................................ 14 Operating Surplus/Deficit ................................................................................ 14
Objectives and Criteria for Developing Revenue Requirements ............................................... 16 Summary of Compliance with Orders from Last Rate Application ............................................. 16 Proposed Rules and Regulations and Regulations ................................................................... 21 Orders Sought .......................................................................................................................... 22 Appendix 1 - Water Rate Studies with Notes to Schedules Appendix 2 - Wastewater Rate Studies with Notes to Schedules Appendix 3 - Stormwater Rate Studies with Notes to Schedules Appendix 4 - HRWC Five Year Business Plan 2013/14 2017/18 Appendix 5 - Audited Financial Statements, Year ended March 31, 2012 Appendix 6 - Unaudited Financial Statements 8 months ending Nov. 30, 2012 Appendix 7 - Supplementary Budget Detail for Test Years Appendix 8 - Proposed Schedule of Rates and Charges for Water, Wastewater and Stormwater Service and Table Summarizing Changes Appendix 9 Study of an Efficient Capital Financing Mechanism (Debt Study) Appendix 10 Regional Development Charge Discussion Paper Appendix 11 Utility Benchmarking Proposal Appendix 12 Non-Union Compensation Benchmarking Appendix 13 2012/13 Cost Savings and Efficiencies
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NOTICE OF APPLICATION NOVA SCOTIA UTILITY AND REVIEW BOARD IN THE MATTER OF: -andIN THE MATTER OF: AN APPLICATION BY THE HALIFAX REGIONAL WATER COMMISSION FOR CERTAIN REVISIONS TO ITS RATES, CHARGES AND REGULATIONS TO: THE BOARD OF COMMISSIONERS OF THE NOVA SCOTIA UTILITY AND REVIEW BOARD The Applicant hereby applies to the Board for an Order: (a) For the approval of a Schedule of Rates and Charges for water, public and private fire protection, wastewater and stormwater services for customers of the Halifax Regional Water Commission, to become effective for services rendered on and after July 1, 2013, a copy of which Schedule is attached as Appendix 8; For the approval of amendments to the Schedule of Rules and Regulations for water, wastewater and stormwater services for customers of the Halifax Regional Water Commission to become effective on or after July 1, 2013 a copy of which Schedule, with the proposed amendments, is attached hereto as Appendix 8; For combination of the Urban Core & Satellite Systems Urban Core and Airport/Aerotech System, henceforth referred to as the Regional System, effective April 1, 2014 For the approval of the Cost of Service Rate Design Manual as filed with the Nova Scotia Utility and Review Board on October 31,2012 THE PUBLIC UTILITIES ACT
(b)
(c)
(d)
The Applicant hereby submits the following particulars in support of this Application: 1. The Halifax Regional Water Commission ("HRWC") is a body corporate, incorporated under the Halifax Regional Water Commission Act, S.N.S. 2007, c.55, as amended, (the HRWC Act) and has its head office and chief place of business at 450 Cowie Hill Road, Halifax, Halifax Regional Municipality, Province of Nova Scotia. HRWC is a public utility regulated under the Public Utilities Act, R.S.N.S. 1989, c.380, as amended, (the Public Utilities Act) and has responsibility for the supply of municipal water and fire protection services, municipal wastewater services and municipal stormwater services throughout the Halifax Regional Municipality (HRM).
2.
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3. The rates charged by HRWC for the services provided by it were last adjusted by Order of the Board effective June 25, 2012 (Urban Core & Satellite Systems) and August 1, 2012 (Airport/Aerotech). On June 11, 2012 the Board ordered that HRWC file a rate application on or before January 31, 2013 including consideration of consolidation of the Airport/Aerotech and the Urban Core. HRWC has completed and filed an Integrated Resource Plan (filed October 31,2012), Cost of Service Rate Design Manual (filed October 31, 2012), and Debt Study (filed with this Application). Unless customer rates are increased, HRWC will not be able to make the required investments in infrastructure renewal, rehabilitation, and environmental compliance as recommended in the IRP. Adoption of the Cost of Service Rate Design Manual will also ensure that rates will be levied in a fair and equitable manner across all customer classes. HRWC therefore makes this Application, pursuant to the provisions of the Public Utilities Act, and the HRWC Act, for approval of a Schedule of Rates and Charges for the supply of water, public and private fire protection, wastewater and stormwater service and approval of the Schedule of Rules and Regulations for the provision of such services as set forth more fully in this Application. In support of this Application, HRWC files the materials attached to this Application. 5. HRWC is represented in this proceeding by: John C. MacPherson, Q.C. McInnes Cooper Purdys Wharf Tower II PO Box 730 1300-1969 Upper Water Street HALIFAX NS B3J 2V1 Phone: (902) 425-6500 Facsimile: (902) 425-6350 Email: john.macpherson@mcinnescooper.com 6. Contact information for HRWC in respect of this application is as follows: Cathie OToole CGA, MBA Director of Finance & Customer Service/Chief Financial Officer Halifax Regional Water Commission PO Box 8388 Station A 450 Cowie Hill Road HALIFAX NS B3K 5M1 Phone: (902) 490-3572 Fax: (902) 490-4749 E-mail: cathie.otoole@halifaxwater.ca Filed at Halifax, Nova Scotia this 9th day of January, 2013.
4.
Cathie OToole, CGA, MBA Director of Finance and Customer Service

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Page 5 Application 2 4 6 8 10 12 14 16 18 20 22 24
Background to this Application HRM transferred the operation of the Aerotech/Airport water system to HRWC on April 1, 2006. On August 1 2007, the municipal wastewater and stormwater facilities of HRM were transferred to HRWC including the Aerotech/Airport wastewater facilities. As a result of this transfer these services became regulated under the Public Utilities Act. The current rate structure and rules and regulations were approved by the the Board following a rate application and public hearing in 2012 (NSUARB-W-R-12 (3)/2012 NSUARB 86) and became effective August 1, 2012. HRWC is a regulated utility pursuant to the Public Utilities Act and has provided potable water and fire protection services to the residents of the former City of Halifax since 1945. Following municipal amalgamation in 1996 these services have been provided to the urban core and satellite systems of the Halifax Regional Municipality (HRM). On August 1 2007, the municipal wastewater and stormwater facilities were transferred by HRM to HRWC and as a result of this transfer these services became regulated under the Public Utilities Act. The current rate structure and rules and regulations were approved by the Nova Scotia Utility and Review Board (Board) following a rate application and public hearing in 2012 (NSUARB-W-HRWC-R-12 /2012 NSUARB 71) and became effective June 25, 2012. (2012 Decision)
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Several initiatives ordered by the Board have been completed and will provide a framework for long-range plans for HRWC: the Cost of Service Rate Design Methodology; the Integrated Resource Plan; and the Debt Strategy. This framework will serve as a touch-stone for future operating and capital budgets and rate applications as indicated in Figure 1. Figure 1 Planning Framework
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The Integrated Resource Plan, and Cost of Service Manual were filed with the the Board on October 31, 2012. The Debt Study is filed as part of this Application. (Appendix 9) Cost of Service Rate Design This Application is prepared in accordance with the new Cost of Service Rate Design based on established methodologies from the American Water Works Association (AWWA) and the Water Environment Federation (WEF) in the context of the local and operational characteristics prevalent for HRWC. The AWWA/WEF Framework achieves a substantial improvement over the existing rate structure in terms of the fairness, defensibility, and relationship to costs. Additionally, because cost allocations are tailored to reflect system characteristics, the approach is adaptable to changing circumstances. This model is more complex than the current rate design in place for HRWC. However it is appropriate given the fact that HRWCs operations are increasingly complex and a cost of service and rate design are required that can adapt in response to change, and allocate costs in a fair and equitable manner. This Cost of Service Rate Design will result in a slightly higher percentage of HRWCs revenues coming from volumetric charges versus base charges. This sends a pricing signal promoting conservation of water, long term sustainability, and operational efficiency, but places increased pressure on the utility to recognize and respond to trends in declining consumption. As part of a December 2010 rate decision, the Board directed a stand-alone Cost of Service and Rate Design proceeding be conducted prior to HRWCs next rate application. The current NSUARB Water Utility Accounting and Reporting Handbook pertains to water utilities and does not provide guidance with respect to rate design for wastewater or stormwater services. In May 2011, HWRC submitted an application for approval of a Cost of Service Rate Design, and a hearing was held in respect of that application on November 21, 2011. Prior to that hearing, HRWC signed a settlement agreement with the Consumer Advocate and Income Property Owners Association of NS. At the hearing on November 21, 2011, HRWC recommended that the settlement agreement be approved by the Board. The settlement indicates that the parties accept the AWWA and WEF based cost of service/rate design, and outlines future activities to be undertaken to finalize a Cost of Service Rate Design Manual. A decision by the Board was rendered on January 16, 2012 which included a direction to HRWC to prepare a Cost of Service Rate Design Manual. HRWCs Terms of Reference for development of the Cost of Service Rate Design Manual were approved by the Board on February 17, 2012. The timeline was altered as a result of the Boards decision regarding HRWCs Airport/Aerotech Rate Application. In this decision, the Board directed HRWC to submit a Rate Application for a combined Urban Core & Airport/Aerotech System by January 31, 2013. As a result the Cost of Service Rate Design Manual deadline was extended to October 31, 2012 to permit inclusion of the Airport/Aerotech system. The Cost of Service Rate Design Manual was developed through engagement and consultation with interested parties, including prior rate application interveners and the Board and is based on cost allocation processes outlined in industry standard manuals of practice.
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Stakeholder consultation meetings were held on March 7th, May 9th & 10th, and September 25, 2012. Feedback from stakeholders has been accepted throughout the process, resulting in many changes and improvements in the final product. The Cost of Service Rate Design Manual was filed with the Board on October 31, 2012. This Application is consistent with the Manual. Integrated Resource Plan
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In response to the Boards decision of December 2010, HRWC undertook a project to develop an Integrated Resource Plan (IRP). The IRP involved developing a comprehensive long-term planning framework and conducting scenario analysis to identify and prioritize future capital and operational programs needed to deliver water, wastewater, and stormwater services. The long-term capital-investment requirements also considered environmental, societal, and financial risks and constraints, and examined both supply-side and demand-side management options and challenges. The IRP was completed and submitted to the Board on October 31, 2012. The resulting IRP provides a long-term plan outlining the revenue requirements to support the capital investments needed and informs HRWC on future rate applications. The IRP focused on providing the following elements: Capital and additional O&M costs to meet the program and project requirements of the Recommended IRP for the 30-year planning period from 2013 to 2043 Development of an overall planning framework integrating the IRP into HRWCs business processes Identification of institutional constraints to implementation of the Recommended IRP Recommendations for additions and refinements of HRWCs Levels of Service (LOS) to facilitate the measurement of program success.
Stakeholder consultation points (technical conferences) beyond the one-on-one meetings included: Terms of Reference Assumptions & Plan Considerations Resource Plans & Sensitivities Resource Plan Analysis Presentation of Draft IRP March 2011 October 2011 December 2011 March 2012 June 2012
The IRP was developed to incorporate three strategic drivers: Regulatory Compliance, Asset Renewal, and Growth. A series of objectives related to each of these drivers was used to identify a range of capital investment needs for the water, wastewater, and stormwater infrastructure over the next 30 years. Projects and programs were reviewed to allocate the proportion of the benefits to each of the objectives/drivers to understand cost causation. The Regulatory Compliance driver covered projects/programs needed to address both current compliance issues (i.e. facilities in respect of which HRWC is not compliant with current permits to operate or with legislation and regulations) and future compliance issues (i.e. requirements resulting from imminent or emerging legislation and regulations).
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The Asset Renewal driver covered projects/programs aimed at a sustainable approach to asset renewal and replacement. Asset Renewal requirements recognized the historical underfunding in some asset classes and evaluated the risk of continuing at the same level of reinvestment in the future. The Growth driver covered projects/programs aimed at providing regional level infrastructure to support growth and in managing flow allocations to optimize system capacity. The total 30-year net present value (NPV) for the recommended plan inclusive of capital and incremental O&M costs is $2,579 million. Asset renewal expenditures represent approximately 54% of the overall IRP; growth and regulatory compliance expenditures represent approximately 23% each. The total 30 Year NPV is shown in Figure 2 below. Figure 2 Integrated Resource Plan 30 Year NPV By Driver
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HRWCs proposed five year capital budget within its Business Plan incorporates IRP projects and prioritization, but is less than the level of spending recommended within the IRP. HRWC proposes to phase in the IRP level of spending over three years, to enable the utility to build the necessary organizational capacity and funding to efficiently increase capital project delivery. It is important to note that Additions to Utility Plant in Service projected within the two test years do not balance with the Capital Budget for the corresponding periods. Additions to Utility Plant in Service reflect projects that will be completed and in service during the test years, while the Capital Budget reflects planned future activity during the test years. Capital projects can span fiscal years, and are often multi-year in nature. A project may commence but not be completed or in service during the test period. Debt Strategy
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On December 17, 2010, the Board rendered a decision on a general rate application by HRWC. The application included a capital-debt policy that the Board was not prepared to approve stating it did not accept that the 30/70 debt-to-equity ratio included in the debt policy was necessarily the most efficient. The Board directed HRWC to undertake a
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complete study examining an efficient capital structure, the policies of other utilities, its longer-term capital needs, and opinions that would result in an efficient funding mechanism that is fair to present and future ratepayers. HRWC recognizes the importance of the debt study. Capital spending, and debt impacts the operating budget and, therefore, the future rate requirements in several ways: 1) Increased debt payments need to be accommodated through rates; 2) Increased depreciation as the capital program grows needs to be accommodated through rates, 3) Operating costs of new capital needs to be accommodated through rates; 4) Capital requirements not funded by debt will create the need for capital from operating funding through rates. On March 11, 2011 the Board approved the Terms of Reference for the Debt Study and HRWC engaged the services of Dr. Mark Gilbert, Phd., to carry out this study. The study focuses on the four areas identified in the Boards December 17, 2010 Order and concludes with a recommendation for an efficient funding mechanism that is fair to present and future ratepayers. The context for the recommendation is one that applies to a local government enterprise providing water, wastewater, and storm water services in Nova Scotia. Using the final IRP, as approved by the HRWC Board on September 28, 2012, several combinations of financing alternatives were examined using a robust financial model developed by the Nova Scotia Municipal Finance Corporation (MFC), and modified by HRWC staff to be more reflective of the utilitys requirements. The financing alternatives were evaluated using three general principles:
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1. 2. 3.
Rate stability and affordability HRWC long term financial sustainability Intergenerational equity
The debt strategy report concludes that some appropriate ratios for HRWC to utilize are:
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1. 2.
Target Debt Service Ratio of 35% Target Debt/Equity Ratio of 40%/60%
In essence, the two targets will serve as a framework for HRWCs strategy when considering future use of debt. Additionally, the report addresses the issue of affordability and refers to a study conducted by the National Consumer Center for the American Water Works Association Research Foundation [now called the Water Research Foundation]. The study, while primarily focused on affordability of water charges, also addresses the affordability of wastewater charges. In the report, affordability of user charges is stated to be 2% of median household income for each service; i.e. 4% for both utility services (Saunders et al. 1998) The manual also refers to a range of 2.3% to 3% of median household income for combined water wastewater bills used by the Ohio Public Works Commission in 1999. As standards have become more stringent since the Saunders study was undertaken, the 4% could now be viewed as the lower end of the affordability range.
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Submission of the study to the Board does not result in any immediate changes to HRWCs budget or rates. However the utilization of debt in the two test years is consistent with the Debt Strategy and within the debt limitations. The Debt Strategy will however be a document that supports future budgets, business plans, and rate applications. The actual financial strategies to finance future infrastructure requirements will be consistent with the recommendations from the Debt Strategy, but will be reviewed and updated as required to reflect changes in key assumptions such as: 1. 2. 3. 4. Interest Rates Availability of Federal/Provincial Infrastructure Funding Approval and implementation of a Regional Development Charge Financial Constraints posed by rates and affordability issues
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There are natural constraints in place that restrict the use of debt, such as the ability to absorb operating costs of new capital, annual operating budget pressures caused by increased debt servicing and depreciation, and rate affordability and shock sensitivity around increasing rates. The impact of HRWC debt on HRM debt limits and policies as well as the current MFC requirement that HRM guarantee most of HRWCs debt is also a consideration in the development of an efficient capital structure. Five Year Business Plan
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A five year business plan has been developed by HRWC to support this Application and to provide information to support the development of a holistic approach to sustainable infrastructure. The test years for the two year Rate Application are 2013/14 and 2014/15 which correspond to years 1 and 2 of the five year business plan. As directed by the Board, this Application considers consolidation of the Urban Core and the Airport/Aerotech system into one rate base, and provides information in support of a holistic asset management and financial plan for HRWC. Several challenges, mainly of a capital nature, during the test years support the need to increase rates, namely: Impact of Significant Current and Imminent Capital Projects There is a need to accommodate new debt servicing and depreciation for projects such as the Eastern Passage Wastewater Treatment Facility (WWTF), the Operations and Administration facilities at Cowie Hill, the Pockwock transmission main renewal along Dunbrack Street and Kearney Lake Road. Future Capital Demands The current water, wastewater and stormwater rates are insufficient to meet the capital needs for sustainable infrastructure as identified in the IRP. The IRP acknowledges that wastewater and stormwater assets have been grossly underfunded historically. Institutional capacity will have to increase over the test years in order to deliver the required capital projects. New Environmental Regulations Increased operating expenses will be incurred by HRWC as it conforms to wastewater regulations recently enacted under the federal Fisheries Act related to the Canadian Council of Ministers of the Environment (CCME) municipal wastewater effluent strategy Increasing Energy and Chemical Costs electricity and chemical costs will continue to increase at a rate higher than inflation.
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Declining Consumption Consumption is projected to continue decreasing by 1.5% per year, resulting in lower revenues. The budgets for the 2013/14 and 2014/15 test years have been prepared in conjunction with the 2013/14 to 2017/18 Business Plan. The operating budget reveals that a rate increase will be required to avoid an operating deficit if HRWC is to maintain its current level of services, complete projects already in progress or approved, and meet stricter environmental regulations. Revenues
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Consumption and Customer Connections
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Figure 3 Projected New Customer Connections There will be a continued decline in consumption leading to revenue reductions. The consumption decrease is projected to be 1.5% per year for each of the test years. This will be partially offset with a projected increase in customer connections allocated to the various meter sizes based on historic review. 938 new customer connections are projected each year as noted in Figure 3 below:
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Meter Size 15 mm 5/8 20 mm 25 mm 1 40 mm1 50 mm 2 80 mm 3 100 mm 4 150 mm 6 200 mm 8 250 10 No. of Customers 850 20 15 30 15 5 3 0 0 0
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Figure 4 Historic Decrease in Consumption (10 Years)
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308
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Expenses HRWCs 5 Year Operating Budget is shown on an accrual basis for 2013/14 forward, to provide better information for decision making and to be reflective of best practice for budgeting. There are accrued amounts regarding Debt Servicing (the pre-financing for Eastern Passage), and for future employee benefits (pension) as calculated under CICA Handbook Section 3461 that for rate making purposes are not included in the test year revenue requirements. The test year revenue requirements are based on cash expenses required to operate the utility. HRWC faces pressure associated with growth, asset renewal, and compliance with regulatory requirements, as described in the Integrated Resource Plan. The largest components of HRWCs consolidated operating budgets are salaries & benefits, electricity, debt servicing, depreciation, and chemical costs. Salaries and Benefits Reasonable provisions for salary increase have been provided for in the 5 Year Plan, based on collective agreements for CUPE Locals 227 and 1431, and market information for non-union compensation. The annual salary increase allowance is 2%, with an
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Revenues from unregulated business activities are increasingly important to mitigate the extent of future rate increases. The budget for Unregulated Activities is shown on page 6 of the Five Year Business Plan Financials in Appendix 4.
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additional allowance made to address the impact of step increases within salary bands or reclassification of positions and increases in benefits. The 2013/14 budget also allows a 4% increase associated with 30 new part and full-time equivalent positions. This is the most significant staffing adjustment since the 2007 Wastewater/Stormwater Transfer. In order to deliver the Integrated Resource Plan it will be necessary to increase institutional capacity to deliver capital projects, including some support positions. Additionally, there are operating implications associated with staffing to deliver the asset management program, enhanced environmental compliance, and management of wet weather including control of inflow and infiltration. Due to the increased level of capital activity, changing rate structures, rate increases, and increasing rate complexity, it will also be necessary to improve communications with customers and also enhance information and services available on-line. A significant staffing adjustment is required in 2013/14; however increases of this magnitude are not anticipated in any other year within the five year business plan. Electricity and Fuel Budgets were established based on an assumption of electricity, fuel, oil and natural gas rate increases in each specific year. The impact of these increases is expected to be partially offset by HRWCs formal Energy Management Program initiated in 2011/12 (see Section 7 of the HRWC Five Year Business Plan). The projected increases are: Electricity 8.3% in year 2013/14 and 10.0% in 2014/15 Furnace Oil 10.0% in 2013/14 and 10.0% in 2014/15 Natural Gas 5.3% in 2013/14 and 3.5% in 2014/15
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The Annual Energy Forecasting Tool used for budget purposes is included in Appendix 7. Debt Financing New debt payments are budgeted to support the Additions to Utility Plant in Service and include significant projects such as the Eastern Passage Wastewater Treatment Facility, a new Operations and Administration building expansion at Cowie Hill, and Dunbrack/Kearney Lake Road Transmission Main. Over the course of the two test years, debt payments are projected to increase by $5.7 M or 25% compared to the 2012/13 projection. It is estimated total debt servicing will increase from $22.9 M in 2012/13 to $28.6 M by 2014/15. The level of debt on a go-forward basis (after the two test years) will ultimately depend upon the funding strategy recommended through the Debt Study as the most efficient and effective funding mechanism for capital. The debt servicing projections referenced above are based upon the status quo. Depreciation
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As HRWCs assets and future capital budgets increase, so do depreciation expenses. Depreciation is an integral funding source to support rehabilitation of the existing infrastructure as well as new infrastructure and upgrades to meet future capital requirements necessitated by both servicing demands and changing environmental regulation. Over the two test years, the depreciation expense is projected to increase from $14.3 M in 2012/13 to $18.4 M in 2013/14 and $21 M in 2014/15. Projected depreciation reflects the completed plant in service during the test periods, and is
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Chemical Costs consistent with depreciation methods and rates prescribed by the NSUARBs Accounting and Reporting Handbook for Water Uilities or otherwise as approved by the Board.
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Operating Surplus/Deficit Chemicals are tendered annually in January for optimal pricing. Chemical cost increases of 5% are anticipated for 2013/14 and 2014/15. Long range chemical prices are difficult to predict due to the volatility of the market which is closely linked with energy prices and fluctuations in supply and demand. The 2013-15 Chemical Forecasting Tool is included in Appendix 7.
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On a consolidated basis, the projected revenue requirements are shown below. Operating Expenses are projected to increase from $85.0 M in 2012/13 to $96.3 M in 2013/14 and to $100.4 M in 2014/15, or 18% cumulatively, while operating revenues are projected to have a slight decrease due to declining consumption. Non-operating revenues are projected to increase by 1% over the two (2) year period however, nonoperating expenses increase by 24% due to increased debt-servicing costs.
Forecast 2012/13
(`000)
Budget 2013/14
(`000)
Budget 2014/15
(`000)
Operating Expenses Non-Operating Expenditures Non-Operating Revenue Less: Adjustments for Accrued Items Projected Revenue Requirements
$85,008 $26,917 $111,925 $2,968 ($3,544) $105,413
$96,328 $27,095 $123,423 $2,957 ($4,199) $116,267
$100,377 $33,310 $133,687 $3,002 ($2,400) $128,285
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The 2013/14 and 2014/15 Operating Budgets are projected to yield operating losses of ($13.5) M and ($25.1) M respectively, without further rate increases. This is broken down between the Urban Core and Satellite Systems and Airport/Aerotech System, and by services, and by Regulated verus Unregulated in the tables below.
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Operating Losses by Jurisdiction Actual 2011/12

(`000)
Forecast 2012/13
(`000)
Budget 2013/14
(`000)
Budget 2014/15
(`000)
Urban Core and Satellite Systems Airport/ Aerotech System Operating Profit (Loss)
($748) ($245) ($993)
($3,431) ($151) ($3,582)
($13,479) ($117) ($13,596)
($24,970) ($150) ($25,120)
Operating Losses by Service Actual 2011/12

(`000)
Forecast 2012/13
(`000)
Budget 2013/14
(`000)
Budget 2014/15
(`000)
Water Wastewater Stormwater Operating Profit (Loss)
$124 $732 ($1,849) ($993)
($762) ($416) ($2,404) ($3,582)
($3,553) ($6,409) ($3,634) ($13,596)
($7,385) ($13,442) ($4,293) ($25,120)
Projected Operating Surpls/(Loss) - Regulated and Un-Regulated Activities 2011/12 2012/13 Budget (`000) (`000) 2013/14
(`000) (`000) (`000)
Budget 2014/15
(`000)
Regulated Unregulated Operating Profit (Loss)
($2,191) $1,198 ($993)
($4,278) $696 ($3,582)
($13,618) $22 ($13,596)
($25,771) $651 ($25,120)
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The actual and projected Accumulated Operating Surplus/(Deficits) are shown in the table below by service. Projections as of November 30, 2012 forecast a combined Operating Deficit of ($3.6 M). It is still early in the year, and worthy of noting that, in addition to snow clearing, the utility experiences the majority of breakage repairs in the winter months. The November 30, 2012 Projections are included within the Rate Application, and used as the basis for comparison with the test year 2013/14, as well as comparison to the 2011/2 audited actuals.
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Accumulated Operating Surplus Urban Core Wastewater Total Water Stormwater 2011/12 Fiscal Year Accumulated Operating Surplus, March 31, 2012 2012/13 Fiscal Year Projected Surplus (Deficit) Projected Year end balance March 31, 2013 $3,243,536 $2,203,022 $1,868,231 ($385,533) ($442,184)
Airport/ Aerotech Wastewater Water Stormwater
428 430
($3,581,000) ($337,464)
($701,000) $1,502,022
($2,729,000) ($860,769)
($61,000) ($446,533)
($90,000) ($532,184)
Objectives and Criteria for Developing Revenue Requirements 432 434 436 438 440 442 444 446 448 450 452 454 456 458 460 462 464 466 468
The Application is submitted under the new Cost of Service Rate Design. 3) Provide sufficient operating revenue and rate of return to accommodate increased debt servicing requirements. 4) Provide sufficient operating revenue for the two test years to enable HRWC to continue to address the infrastructure deficit and regulatory compliance issues facing the utility. 5) Recognize an annual increase in customer base of 938 customer connections divided between domestic, industrial, commercial, multi-residential and institutional based on the average increase over the past few years. 6) Recognize a 1.5% reduction in the annual volume of water sold has been factored in as conservation more than offsets the volume increases due to new customers. 1) Provide sufficient operating revenue for the two test years to cover the operating and non-operating costs for water, wastewater, and stormwater services. 2) Provide sufficient operating revenue to accommodate depreciation for additions to utility plant in service. As indicated in the previous section, a number of factors require HRWC to file this Application. HRWC has incurred significant operating losses in its most recent fiscal years (2010/11), (2011/12) and is projecting a loss for the current fiscal year (2012/13). This Application will need to address the following objectives.
Summary of Compliance with Orders from 2012 Rate Application

The Boards June 25, 2012 Order regarding the Urban Core Rate Application directed HRWC to carry out a number of specific activities, the status of such activities is provided below. [1] In its next compensation survey use a more relevant (possibly including Atlantic Utilities) and extensive group of comparable companies/organizations to determine the
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[6] Receive prior Board approval before HRWC enters into any cost sharing arrangements, including deep stormwater services. [5] Include in future rate applications, a section which summarizes its cost containment efforts and results, including benchmarking information. A section summarizing cost containment achievements in 2012/13 is included in Appendix 13. HRWC has investigated operational performance benchmarking and reviewed benchmarking available through the American Water Works Association which has definite shortcomings, and the National Water and Wastewater Benchmarking Initiative (NWWBI) Facilitated by AECOM. Benchmarking is not useful unless it is of good quality and based on data that is normalized to ensure appropriate comparisons can be drawn. HWRC has included a proposal prepared by AECOM in Appendix 11 and has concluded that involvement would benefit the utility. If the Board determines this involvement would satisfy future requirements, HRWC will participate in the 2013/14 benchmarking program which commences Spring 2013. The estimated cost based on standard NWWBI rates of $65,000 per year has been included in the revenue requirements for the two test years to implement the benchmarking program. The Procedure was reviewed and revised. The revised Procedure for Acceptance of Private Community Water, Wastewater, Stormwater Systems is included within the Proposed Rules and Regulations in Appendix 8. This was evidenced by the year end results presented within the March 31, 2012 Audited Financial Statements. On a go forward basis disclosure in the notes to the Financial Statements will add more detail regarding the impact of any unregulated activity. [4] Review its Procedure for Acceptance of Private Community Water Systems for subsequent approval by the Board [2] Start an appropriate set of accounts to track and report the amount of unregulated income or loss on an annual and accumulated basis. HRWC implemented this reporting within the March 31, 2012 Audited Financial Statements. Future fiscal years will continue to segregate results from unregulated activities. [3] Report, on an annual basis with the financial statements, that any unregulated activity carried out was not to the detriment of the Utility. HRWC engaged the Hay Group to conduct a non-union compensation survey with the comparator organizations that the subject matter experts deemed to be most relevant. These are primarily public sector organizations with defined benefit pension plans; and include organizations from across Canada, and a few utilities. This survey is included in Appendix 12. There are no publicly or privately owned Atlantic Utilities that are of comparable size. Within Appendix 12, a comparison chart between executive and senior level HRWC and HRM non-union salaries is also provided for local context. appropriate compensation levels. At a minimum, the group should be closer in size to HRWC.
January 9, 2013
Page 18
Page 18 522 524 526 528 530 532 534 536 538 540 542 544 546 548 550 552 554 556 558 560 562 564 566 568 570 572
[11] In its future rate applications clearly indicate the impact of proposed total rate increases for residential customers on a quarterly basis. The five year capital budget was prepared based on status quo funding assumptions. Any increase in development related charges would result in reduced debt servicing in future years depending upon the level of development activity. [10] Carry out directives given in Board 2010 Decision with respect to the Availability Charge. The Regional Development Charge (RDC) report is included in Appendix 10. Public Consultation sessions with the development community were held and are summarized within the report. HRWC submits that cost causation needs to be balanced with affordability. Stakeholders such as the Urban Development Institute and Nova Scotia Homebuilders have expressed concern that a significant increase in cost could stifle growth and development within the municipality. This concern was shared by the Chief Economist from the Greater Halifax Partnership, and HRM planning staff. Stakeholders are also concerned that the RDC enable equitable application to different kinds of development, and should not incent any development activity/forms that are contrary to HRM Regional Plan objectives. The Proposed Rules and Regulations within Appendix 8 include continuation of the existing Trunk Sewer Charge, Sewer Redevelopment Charge, and Regional Wastewater CCC at existing levels. HRWC proposes to continue working with stakeholders to determine the appropriate level of growth related infrastructure to collect through the RDC. HRWC would file an application to establish the RDC pending completion of the next steps, as identified in the Regional Development Charge Discussion Paper in Appendix 10. [9] Shall not include the costs for sponsorship, donations and promotions in future revenue requirements. Sponsorships and donations are budgeted as unregulated business. HRWC does not engage in promotional activities. Within prior budgets, costs associated with customer communication were included in a general ledger account that was named in a manner that was not truly reflective of the nature of the activities. Effective with the March 31, 2012 Audited Financial Statements, Accumulated Operating Surplus used to fund additions to utility plant in service (capital) is identified, as well as the remaining available surplus. [7] Assume its wind energy projects are an unregulated service unless subsequently determined by the Board to be otherwise. Activities with respect to wind energy are included in unregulated business. [8] Incorporate in its financial statements the appropriate amount of operating and available surplus. The issue of cost sharing arrangements including deep stormwater services is the subject matter of a report going to HRM Council in January, 2013. HRWC will seek Board approval before entering into any such arrangements, and specific capital project approval.
January 9, 2013
Page 19
Page 19 574 576

This has been incorporated within the Rate Application models on the schedule of Rates & Charges tab. The total projected impact for residential customers on an annual basis is summarized in the table below.
Bill Comparison - Combined Services ( Average Residential Household ) Current Rates Water Base Charge Consumption Charge Proposed Rates 2013/14 2014/15 Changes (year over year) 2013/14 2014/15 $ % $ % ($63.28) $73.88 $10.60 -43.9% 77.2% 4.4% $5.77 $20.68 $26.45 7.1% 12.2% 10.6%
(1)
$144.12 $95.69 $239.81
$80.84 $169.58 $250.41
$86.61 $190.26 $276.87
Wastewater Base Charge Consumption Charge
(1)
$152.16 $243.65 $395.81
$140.16 $263.20 $403.36
$164.82 $324.51 $489.33
($12.00) $19.55 $7.55
-7.9% 8.0% 1.9%
$24.66 $61.31 $85.97
17.6% 23.3% 21.3%
Stormwater Base Charge
$0.00
$53.20
$58.67
initial year
$5.47
10.3%
Annual total
$635.62
$706.97
$824.87
$71.35
11.2%
$117.89
16.7%
578 580 582 584 586 588 590 592 594 596 598 600 602 604 606 608
(1)
Based on estimated annual household consumption of 188 cubic metres
The Board Order regarding the Airport/Aerotech Rate Application (June 11, 2012) also directed HRWC to carry out a number of specific activities. The activities which impact this Application are noted below. [4] Based upon HRWCs request at the hearing, the Board sets the following timetable for HRWCs filings: Cost of Service Manual Integrated Resource Plan Debt Study October 31, 2012 October 31, 2012 October 31, 2012
HRWC indicated it would be in a position to file a rate application (including consideration of consolidation of the Airport/Aerotech and the Urban Core) on or before January 31, 2013. HRWC filed the Cost of Service Rate Design (COS) Manual and IRP on October 31, 2012. The Board granted HRWCs request for a 90 day extension on the filing of the Debt Study. The Debt Study is included as Appendix 9 of this Application. When the Bennery Lake Water Supply Plant was transferred to HRWC from HRM in 2007, HRWC initially proposed that it become part of the Urban Core. HRWC is not opposed to the consolidation of the Urban Core & Satellite Systems and Airport/Aerotech System but believes that the treatment of the Halifax International Airport Authority (HIAA) should be consistent with treatment of other customers. HRWC notes that relationship with HIAA is governed by the terms and conditions of the Rules and Regulations as approved by the Board, as noted in its decision of 2008 NSUARB 149, which states:
January 9, 2013
Page 20
Page 20
[165] The Utility in its Post-Hearing Submission noted that the Agreement between HIAA and HRWC is not binding on the Board and referred to the 1975 decision of the Nova Scotia Court of Appeal.1 HIAA did not provide any rebuttal. [166] The Board agrees with HRWCs submission. The wastewater and stormwater system was transferred from HRM to HRWC on August 1, 2007. Any agreements or contracts which were entered into prior to becoming a regulated public utility are not applicable once regulated rates, rules and regulations are in place. Indeed, one of the reasons for the significant increase in wastewater rates is that the agreement set rate does not appear to be based upon the cost of service. HRWC notes that the 1987 Agreement is no longer valid for rates, or for any other terms and conditions of service falling within jurisdiction of the Board. HIAA would be treated consistent with other Institutional, Commercial or Industrial customers (ICI) and would be master metered in accordance with section 14 of the existing Rules and Regulations (section 48 of the Proposed new Rules and Regulations). The Public Utilities Act gives the Board the power of general supervision of all utilities (Section 18) and defines service in broader terms than rates and charges. In respect of water utilities, service is defined in terms of production, transmission and delivery (subclause 2(f)(v). The rules and regulations approved by the Board are the lawful rules and regulations of the utility. The foregoing is consistent, in our view, with the statement by the Board at paragraph 166 of its decision reported as 2008 NSUARB 149, with reference to the 1987 Agreement, that Any agreements or contracts which were entered into prior to becoming a regulated public utility are not applicable once regulated rates, rules and regulations are in place. [5] The Board directs HRWC to include in its rate application/consolidation filing noted above, information concerning the classification of some services as unregulated versus regulated, and whether that classification should continue. Information on unregulated activities is presented within the 5 Year Business Plan, including projected budgets. With respect to classification, HRWCs unregulated activities include treatment of septage (septage hauling & airline effluent), contract treatment of leachate, and potential future energy related projects such as in-line turbines, wind energy, and bio-mass cogeneration. To the extent that HRWC does not need to generate electricity, treat septage, or treat leachate directly as part of the provision of core water, wastewater, and stormwater services, it considers these services to be unregulated. At the time of transfer of wastewater and stormwater in 2007, HRWC had initially considered septage and leachate charges to be a regulated activity. The Board in its 2008 decision (2008 NSUARB 8) states that: [107] As these are unregulated operations of HRWC, the charges under these systems are not before the Board and, as a result, the Board directs that references to them be deleted from the Schedule of Rate and Charges.
610 612 614 616 618 620 622 624 626 628 630 632 634 636 638 640 642 644 646 648 650 652 654 656 658
18 N.S.R. (2d) 692, 75 D.L.R. (3d) 72

Page 21
January 9, 2013
Page 21
[108] As a general observation, the Board notes that the Utilitys primary role is not in the processing of leachate, which in the future could become an issue if the volumes become significantly larger than they are at present. The Utility may wish to reconsider whether it should continue leachate processing. A review of septage and leachate treatment indicates that this is not a commonly regulated activity as HRWC is not aware of any example of regulated treatment of these products. Generally these services are provided either by the municipal government, or by private sector industry/utilities. HRWC proposes to continue operation of unregulated activities under the following principles: 1. The rate base cannot be exposed to undue financial risk associated with capital financing. 2. Unregulated expenses must be funded by unregulated revenues.
660 662 664 666 668 670 672 674 676 678 680 682 684
3. Cost causation principles must be employed and there should be no subsidization of unregulated activities from regulated activities. 4. There should be a net return/benefit to the rate base from unregulated activities.
Proposed Rules and Regulations 686 688 690 692 694 696 698 700 702 704 706 708
3. The proposed Rules and Regulations were drafted to reflect inclusion of the Airport/Aerotech system. Appendix 8 also includes a table summarizing the proposed changes to the Rules and Regulations, comparing to the existing Urban Core Rules and Regulations. 2. The existing Rules and Regulations from Schedules A and B have been updated to reflect modern legislative and regulatory drafting conventions, with an objective to improve clarity and conciseness. 1. The existing Schedule A Schedule of Rates and Charges, and Schedule B Schedule of Rules and Regulations have been combined in one document. Having one Schedule of Rules and Regulations will improve clarity for customers. There are currently charges established in both Schedules A and B, so maintaining two distinct Schedules no longer serves a purpose. The proposed Rules and Regulations included in Appendix 8 reflect three significant changes.
January 9, 2013
Page 22
Page 22 710 712

1.
Orders Sought
HRWC requests approval of the Schedule of Rates and Charges set forth in this Application. HRWC requests approval of the Schedules of Rules and Regulations as set forth in this Application. HRWC requests approval to consolidate the Airport/Aerotech System with the Urban Core & Satellite Systems. HRWC requests approval of the Cost of Service Rate Design (COS) Manual.
714 716 718

3. 2.
720 722 724

4.
January 9, 2013
Page 23
Water Rate Study 2013/14 Appendix 1 Page 1
HRWC Water Rate Study
Prepared By: HRWC Staff in association with G.A. Isenor Consulting Limited Blaine S. Rooney Consulting Ltd. Eric P. Rothstein - Galardi Rothstein Group
January 9, 2013
Page 24
Notes on Worksheet Worksheet W-1 System Data

Worksheet W-1 provides water system related data including; Water plant production for the three previous fiscal years, and 3 year average water plant production. Average day and max day production with related percentages and ratios between the two. Projected service connections, meter equivalents, and billed usage for the 2013/14 and 2014/15 test years. Water consumption history by customer class average for the three fiscal years spanning 2009/10 to 2011/12 including a reallocation of estimated commercial consumption from the residential 15 mm (5/8) meter size. Historical consumption by meter size and customer class for the three previous fiscal years 2009/10, 2010/11 and 2011/12.
The 2013/14 test year is based on two key assumptions: 1. Water consumption will continue to decrease by 1.5% per year consistent with the 10 year historic average. 2. Customer connections will increase by 938 connections in 2013/14, consistent with the historic growth pattern.
January 9, 2013
Page 25

Projected Growth Estimated # of Services 2012/13 320 6 77,417 982 1,523 1,006 748 277 75 37 14 2 82,407
938
Meter Size Unmetered 5/8" Unmetered 1" 15 MM - 5/8" 20 MM - 3/4" 25 MM - 1" 40 MM - 1 1/2" 50 MM - 2" 80 MM - 3" 100 MM - 4" 150 MM - 6" 200 MM - 8" 250 MM - 10"
Projected Growth 2012/13 0 0 850 20 15 30 15 5 3 0 0 0 938
# of Services 3/31/2012 320 6 76,567 962 1,508 976 733 272 72 37 14 2 81,469
Projected # of Services 2013/14 320 6 78,267 1,002 1,538 1,036 763 282 78 37 14 2 83,345
938
938
Consumption Total Consumption 3/31/2012 60,437 7,866 14,472,108 626,745 1,947,477 2,780,751 5,103,397 4,313,598 2,898,958 3,553,115 1,540,716 89,575 37,394,743
37,020,810 305,630 68,303 37,394,743
Meter Size Unmetered 5/8" Unmetered 3/4" 15 MM - 5/8" 20 MM - 3/4" 25 MM - 1" 40 MM - 1 1/2" 50 MM - 2" 80 MM - 3" 100 MM - 4" 150 MM - 6" 200 MM - 8" 250 MM - 10"
Estimated Estimated Estimated Consumption Consumption Consumption 2012/13 2013/14 2014/15 59,530 7,748 14,255,026 617,344 1,918,265 2,739,040 5,026,846 4,248,894 2,855,474 3,499,818 1,517,605 88,231 36,833,822
-1.50%
58,637 7,632 14,041,201 608,084 1,889,491 2,697,954 4,951,443 4,185,161 2,812,642 3,447,321 1,494,841 86,908 36,281,315
-1.50%
57,758 7,517 13,830,583 598,962 1,861,149 2,657,485 4,877,172 4,122,383 2,770,452 3,395,611 1,472,419 85,604 35,737,095
-1.50%
Urban Core Aerotech Unmetered
January 9, 2013
Page 26

Halifax Regional Water Commission Water Rate Study Worksheet W-1
Water Plant Production and User Characteristics Data

Water Production
2009/10 Average Day Production (in cubic meters) Lake Major 41,783 Lake Pockwock 88,705 Bennery Lake 1,083 System 131,571 Maximum-Day Production (in cubic meters) Lake Major 53,780 Lake Pockwock 107,706 Bennery Lake 1,820 System 163,306 2010/11 39,932 86,071 1,026 127,029 2011/12 40,202 82,984 1,083 124,269 Average 40,639 85,920 1,064 127,623 2009/10 2010/11 2011/12 Average Average Day as a Percent of Maximum Day 78.00% 72.00% 80.00% 77.00% 82.00% 80.00% 83.00% 82.00% 60.00% 55.00% 52.00% 55.00% 81.00% 77.00% 82.00% 80.00% Max-Day / Average Day Ratio 1.29 1.38 1.21 1.25 1.68 1.81 1.24 1.30
55,140 107,526 1,860 164,526
50,002 99,705 2,090 151,797
52,974 104,979 1,923 159,876
1.24 1.20 1.93 1.22
1.30 1.22 1.81 1.25
Usage Characteristics Service Connections, Equivalents and Billed Usage

Date January 3, 2013 Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 15 MM - 5/8" 20 MM - 3/4" 25 MM - 1" 40 MM - 1.5" 50 MM - 2" 80 MM - 3" 100 MM - 4" 150 MM - 6" 200 MM - 8" 250 MM - 10" TOTAL
2013/14
Number of Services 320 6 78,267 1,002 1,538 1,036 763 282 78 37 14 2 83,345 Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150 System Equivalents 320 0 15 78,267 1,503 3,845 5,180 6,104 4,512 1,950 1,850 1,260 300 105,106
Estimated Consumption (Cubic Meters) 58,637 7,632 14,041,201 608,084 1,889,491 2,697,954 4,951,443 4,185,161 2,812,642 3,447,321 1,494,841 86,908 36,281,315
Test Years 1 2 Current Year Historical Year
2013/14 2014/15 2012/13 2011/12
Customer Classes Residential Non-Residential SF Residential Commercial Multi-Family Industrial Institutional Unmetered
Halifax Water
Consumption Summary Consumption m3 Class
Share
Calculated
Peaking Factors (2)

Loudon Max Day Max Hour
Distrib. Design Factors

Max Day Max Hour
Extra-Capacity
Max Day Max Hour
2009 - 2012
(1)
Realloc. of 5/8" Revised Total
Commercial Industrial Institutional Multi-Family SF Residential
5,439,302 2,774,125 6,385,019 8,772,891 14,829,254
2,155,955
7,595,257 2,774,125 6,385,019 8,772,891 12,673,298
19.85% 7.25% 16.68%
19% 8% 14%
1.22 1.22 1.22 1.22 1.22
1.70 1.70 1.70 1.70 1.70
4,578 1,672 3,849 5,288 7,639
416 152 350 481 694
(2,155,955)
Subtotal Res
Unmetered
70,526 70,526 Total 38,271,118 38,271,118 (1) Water Consumption based on 3 year average spanning fiscal years 2009/10 to 2011/12 inclusive (2) Loudon Report Pages 70-71 Total Non-Residential 14,598,447
22.92% 33.11% 56% 59-66% 0.18%
1.66
2.50
Avg Use
Commercial 5,439,302
Industrial 2,774,125
Institutional 6,385,019
Multi-Family
SF Residential
8,772,891
14,829,254
Total Residential Unmetered 23,602,145 70,526
Total System
38,271,118
April 2011 - March 2012

Commercial Meter Size 5/8" 3/4" 1" 1.5" 2" 3" 4" 6" 8" 10" 53,910 237,457 657,563 1,238,664 1,237,530 850,095 652,665 230,033 33,672 83,520 5,275,109 Industrial 830 433 1,917 8,905 41,044 469,849 982,420 757,411 176,236 2,439,045 Institutional 1,505 31,142 150,008 200,753 671,586 880,726 655,959 2,476,386 1,315,518 6,055 6,389,638 Total Non-Residential 56,245 269,032 809,488 1,448,322 1,950,160 2,200,670 2,291,044 3,463,830 1,525,426 89,575 14,103,792
Multi-Family SF Residential
Total Residential 14,415,863 357,713 1,137,989 1,332,429 3,153,237 2,112,928 607,914 89,285 15,290 23,222,648 Total Residential 15,114,219 366,585 1,168,580 1,325,283 3,172,142 1,956,296 583,063 93,839 14,200 23,794,207 Total Residential 15,029,337 355,852 1,187,514 1,336,203 3,166,826 1,969,618 622,018 106,942 15,270 23,789,580
Unmetered
Total System 14,532,545 626,745 1,955,343 2,780,751 5,103,397 4,313,598 2,898,958 3,553,115 1,540,716 89,575
43,146 350,337 1,128,643 1,325,009 3,153,237 2,112,928 607,914 89,285 15,290 8,825,789
14,372,717 7,376 9,346 7,420 14,396,859

SF Residential
60,437 7,866 68,303
37,394,743

Multi-Family Unmetered Total System 15,250,491 650,534 2,048,863 2,852,741 5,195,980 4,128,823 2,856,916 3,884,245 1,230,459 75,690
36,819 359,407 1,159,840 1,322,533 3,172,142 1,956,296 583,063 93,839 14,200 8,698,139
15,077,400 7,178 8,740 2,750
15,096,068
SF Residential
62,320 8,111 70,431
38,174,742

Commercial Meter Size 5/8" 3/4" 1" 1.5" 2" 3" 4" 6" 8" 10" 79,529 252,956 771,854 1,286,519 1,322,027 908,838 662,941 230,010 35,083 74,505 5,624,262 Industrial 1,110 3,889 12,306 29,563 612,263 1,623,826 925,925 179,628 3,388,510 Institutional 4,162 34,361 143,834 215,324 712,625 891,518 522,354 2,670,843 1,159,741 13,910 6,368,672 Total Non-Residential 84,801 287,317 919,577 1,514,149 2,064,215 2,412,619 2,809,121 3,826,778 1,374,452 88,415 15,381,444
49,278 351,443 1,177,510 1,335,841 3,166,826 1,969,618 622,018 106,942 15,270 8,794,746
14,980,059 4,409 10,004 362 14,994,834
64,455 8,389 72,844
39,243,868
January 9, 2013
Page 27
Worksheet W-2 Operations

Worksheet W-2 provides a comparative Statement of Operations for fiscal years ending March 31 as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for water service as per the Audited Financial Statements. Projected results for the current fiscal year (April 1, 2012 to March 31, 2013) for water service, as of November 30, 2012. Budgeted revenue and expenditures for both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at current rates, and separated between regulated and non- regulated services. This worksheet details the projected deficit at current rates in water service for the test years.
Water Services had an excess of revenues over expenditures of $124 k for the year ended March 31, 2012, consisting of $191 k from the Urban Core System and ($67 k) from the Airport Aerotech System as shown on pages 17 and 19 of the Audited Financial Statements respectively (see Appendix 5). This excess represented 0.003% of total revenues. A loss of $742 k (or 0.017% of total revenues) is projected for the current 2012/13 fiscal year, with projections as at November 30, 2012. The Operating Statements and Audited Financial Statements include some accrued and unregulated items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet W-3.
January 9, 2013
Page 28

Worksheet W-2 Halifax Regional Water Commission Water Rate Study Comparative Statement of Operations
Fiscal Years ending March 31st 2011/12 Actual OPERATING REVENUES Regulated Activities Metered Sales Public Fire Protection Private Fire Protection Bulk Water Sales Late Payment Fees Miscellaneous Sub-total Unregulated Activities Contract Revenue 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget
$31,098,691 $9,644,048 $365,693 $263,745 $206,781 $124,927 $41,703,885 $36,000 $41,739,885
$33,059,612 $9,999,009 $366,698 $217,667 $249,695 $139,282 $44,031,963 $36,000 $44,067,963
$33,423,695 $10,130,770 $374,088 $243,021 $229,219 $133,710 $44,534,503 $20,580 $44,555,083
$33,091,507 $10,140,535 $379,188 $243,021 $227,486 $133,710 $44,215,447 $21,000 $44,236,447
Total Operating Revenues

OPERATING EXPENDITURES Regulated Activities Supply and Treatment Transmission and Distribution Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Depreciation Sub-total Unregulated Activities Contract Revenue
$7,124,766 $7,082,011 $859,708 $2,959,634 $627,979 $1,698,396 $3,631,165 $6,500,471 $30,484,131 $14,105 $30,498,236 $11,241,650
$7,804,237 $7,849,131 $967,477 $3,242,671 $619,023 $1,775,922 $4,490,872 $6,860,271 $33,609,604 $14,586 $33,624,190 $10,443,773
$8,055,272 $9,087,258 $841,886 $3,521,980 $708,684 $1,877,571 $4,742,402 $7,601,175 $36,436,228 $13,566 $36,449,794 $8,105,289
$8,332,702 $9,170,874 $898,188 $3,732,884 $720,165 $1,903,222 $4,763,076 $8,366,626 $37,887,737 $13,897 $37,901,634 $6,334,813
Total Operating Expenditures

OPERATING PROFIT (LOSS) NON-OPERATING REVENUES Regulated Activities Investment Income Miscellaneous Sub-total Unregulated Activities Tower Leases Energy Projects (net) Rental Income (net)
$201,358 $21,287 $222,645 $65,501 $0 $19,486 $307,632
$350,000 $51,000 $401,000 $121,536 $0 $16,015 $538,551
$330,000 $51,000 $381,000 $146,105 $12,887 $6,200 $546,192
$330,000 $51,000 $381,000 $156,506 $25,775 $26,200 $589,481
Total
NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Amortization of Bond Discount New Debt - Principal (2013/14) New Debt - Interest (2013/14) New Debt - Principal (2014/15) New Debt - Interest (2014/15) Grant in Lieu of Taxes
$4,932,722 $5,266,136 $5,701,489 $2,496,154 $2,432,869 $2,134,481 $51,850 $53,946 $66,785 $0 $0 $438,101 $0 $0 $404,805 $0 $0 $0 $0 $0 $0 $3,943,762 $3,971,445 $4,248,816 Total $11,424,488 $11,724,396 $12,994,476 $124,794 ($742,072) ($4,342,996) EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES $14,072,695 $14,197,489 $13,455,417 SURPLUS BEGINNING OF THE YEAR $14,197,489 $13,455,417 $9,112,421 ACCUMULATED SURPLUS (DEFICIT)
$6,791,172 $2,668,615 $80,233 $876,201 $769,129 $163,879 $151,424 $4,670,874 $16,171,527 ($9,247,233) $9,112,421 ($134,812)
January 9, 2013
Page 29
Worksheet W-3 Revenue Requirements

Worksheet W-3 takes the operating and non- operating expenditure information from Worksheet W-2 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from fire protection and water service customers. Adjustments are made for the difference in the pension & employee future benefits expense calculation per CICA section 3461 for accounting purposes, and the actual funding required per the current actuarial valuation. As per the Boards direction from the last general rate application, sponsorship and donation expenses and the funding for the Good Neighbours/Help 2 Others (H20 Program), are not included in revenue requirements.
January 9, 2013
Page 30
Worksheet W-3
January 3, 2013
Halifax Regional Water Commission Water Rate Study

Statement of Operating Expenditures and Revenue Requirements
Fiscal Years ending March 31st 2011/12 Actual OPERATING EXPENDITURES Supply and Treatment Transmission and Distribution Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Depreciation 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget
Total
ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Amortization of Bond Discount New Debt - Principal New Debt - Interest New Debt - Principal New Debt - Interest Grant in Lieu of Taxes
$7,124,766 $7,082,011 $859,708 $2,959,634 $627,979 $1,698,396 $3,631,165 $23,983,660 $6,500,471 $30,484,131
$7,804,237 $7,849,131 $967,477 $3,242,671 $619,023 $1,775,922 $4,490,872 $26,749,333 $6,860,271 $33,609,604
$8,055,272 $9,087,258 $841,886 $3,521,980 $708,684 $1,877,571 $4,742,402 $28,835,053 $7,601,175 $36,436,228
$8,332,702 $9,170,874 $898,188 $3,732,884 $720,165 $1,903,222 $4,763,076 $29,521,111 $8,366,626 $37,887,737
Total
LESS NON-OPERATING REVENUES Regulated Activities Investment Income Miscellaneous
$4,932,722 $2,496,154 $51,850 $0 $0 $0 $0 $3,943,762 $11,424,488
$5,266,136 $2,432,869 $53,946 $0 $0 $0 $0 $3,971,445 $11,724,396
$5,701,489 $2,134,481 $66,785 $438,101 $404,805 $0 $0 $4,248,816 $12,994,476
$6,791,172 $2,668,615 $80,233 $876,201 $769,129 $163,879 $151,424 $4,670,874 $16,171,527
Total
LESS OTHER OPERATING REVENUE Bulk Water Sales Late Payment Fees Miscellaneous
$201,358 $21,287 $222,645
$350,000 $51,000 $401,000
$330,000 $51,000 $381,000
$330,000 $51,000 $381,000
Total
LESS OTHER ADJUSTMENTS Pension Adjustment (Water portion - 51%) Sponsorships and Donations (Water portion - 51%)
$263,745 $206,781 $124,927 $595,453
$217,667 $249,695 $139,282 $606,644
$243,021 $229,219 $133,710 $605,950
$243,021 $227,486 $133,710 $604,217
Total
REVENUE REQUIRED FROM FIRE PROTECTION AND WATER CUSTOMERS
$326,808 $0 $326,808
$1,224,000 $0 $1,224,000
$1,224,000 $27,846 $1,251,846
$1,224,000 $27,846 $1,251,846
$40,763,712
$43,102,356
$47,191,909
$51,822,201
January 9, 2013
Page 31
Worksheet W-4 Operating Expenditure Analysis

Worksheet W-4 details the operating expenditures by cost element for each water operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over $20,000 or 5%. Total Operating Expenses were $30,484,131 for 2011/12 and are projected to be $33,609,604 or 10% ($3,125,473) higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $2,826,625 or 8% over 2012/13 for a total of $36,436,228. Increasing depreciation accounts for 26% or $740,904 of the increase in 2013/14. The other primary drivers are salaries and benefits, chemicals, and electricity. Further detailed analysis is provided for each category of water operating expense. The increase in depreciation from 2012/13 to 2013/14 in the amount of $740,904 is primarily the result on capital asset additions in IT, transmission mains (Kearney Lake Road) and buildings, including the Cowie Hill operations facility and the office building expansion. The increase in 2014/15 totaling $765,451 over 2013/14 is driven by the same asset categories, as depreciation is increasing from a half year in 2013/14, to a full year in 2014/15 on these new assets. It should be noted, depreciation for 2013/14 in the amount of $7,601,175 appearing in Worksheet W-4 below differs from the depreciation amount of $8,257,980 shown on Worksheet W-7, Continuity Schedule Utility Plant in Service. The difference of $656,805 relates to depreciation on transportation equipment, which is expenditure within Fleet Services.
January 9, 2013
Page 32

Worksheet W-4
January 3, 2013

Operating Expenditures and Financial Analysis
Variances Operating Expenditures
2011/12 Actual 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget ( year over year - $ and % ) 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget
Depreciation
Depreciation $6,500,471 $6,860,271 $7,601,175 $8,366,626 $359,800 6% $359,800 6% $740,904 11% $740,904 11% $765,451 10% $765,451 10%
Total Depreciation $6,500,471
$6,860,271
$7,601,175
$8,366,626
Total Operating Expenditures $30,484,131 $33,609,604 $36,436,228 $37,887,737
$3,125,473 10%
$2,826,625 8%
$1,451,509 4%
January 9, 2013
Page 33
Water Rate Study 2013/14 Appendix 1 Page 11 Supply and Treatment Salaries and Benefits - The 2013/14 costs are projected to decrease 1% or ($17 k) from 2012/13. In 2013/14 there are a number of changes from an organizational perspective within Supply and Treatment. The retirement of a key employee has resulted in savings, since the successor is at a lower salary. The successor came from within the organization, and the successors former position will be filled with an individual that would enter at the lower end of the salary band. Savings have also resulted from a supervisory position being phased out of the structure. Finally, in 2012/13 there is an overlap in one position for a short period of time, due to one of the staff taking maternity leave. Contract Services Is budgeted to increase by 42% or $184 k in 2013/14 from 2012/13, due to a $400,000 project to clean the North Preston Reservoir, which is being partially offset by completion of some 2012/13 projects for chain link fencing, and dam related repairs such as railings. Electricity Is budgeted to increase 10% or $162k in 2013/14 over 2012/13 based on projected consumption and rate increases. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services Are budgeted to decrease 11% or ($99k) in 2013/14 compared to 2012/13 due to completion of some 2012/13 related work from the Dam Safety Review and System Assessment Reports; and a lower level of activity in 2013/14. Professional Services Is budgeted to decrease by 16% or ($66k) in 2013/14 compared to 2012/13 due to completion of some 2012/13 related work from the Dam Safety Review and System Assessment Reports; and a lower level of activity in 2013/14. Fleet Services Is budgeted to increase in 2013/14 by 10% or $24k over projected 2012/13 due to increasing fleet unit charge rates including fuel costs. Supplementary detail for fleet costs is shown in Appendix 7. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. Chemicals Is budgeted to increase by 3% or $59k in 2013/14 over projected 2012/13, based on current tendered prices and estimated usage based on estimates from chemical providers of 5% increases in chemical prices. Chemicals will be tendered in January for contracts beginning April 1st, so this is a budget risk for HRWC. A separate schedule for projected chemicals expenditures is shown in Appendix 7.
January 9, 2013
Page 34

Worksheet W-4
January 3, 2013

Water Supply and Treatment

Salaries and Benefits $2,345,676 $2,467,540 $2,450,648 $2,531,521 $121,864 5% $17,121 54% $45,470 12% $52,581 3% $173,116 24% $304,982 259% ($43,739) -16% $138,363 7% ($16,539) -13% ($113,749) 29% $679,470 10% ($16,892) -1% $6,770 14% $184,220 42% $162,294 10% ($98,903) -11% ($66,377) -16% $23,721 10% $58,768 3% $12,995 11% ($15,561) 3% $251,035 3% $80,873 3% ($2,500) -5% $14,000 2% $182,474 10% ($53,439) -7% ($52,500) -15% ($5,100) -2% $103,687 5% $3,818 3% $6,117 -1% $277,430 3%
Training and Development
$31,619
$48,740
$55,510
$53,010
Contract Services
$389,023
$434,493
$618,713
$632,713
Electricity
$1,620,574
$1,673,155
$1,835,449
$2,017,923
Materials, Supplies and Services
$714,613
$887,729
$788,826
$735,387
Professional Services
$117,530
$422,512
$356,135
$303,635
Fleet Services
$278,350
$234,611
$258,332
$253,232
Chemicals
$1,887,315
$2,025,678
$2,084,446
$2,188,133
Applied Overheads and Other Allocations
$130,203
$113,664
$126,659
$130,477
Allocated to Transmission and Distribution
($390,136)
($503,885)
($519,446)
($513,329)
Total Water Supply and Treatment $7,124,766
$7,804,237
$8,055,272
$8,332,702
January 9, 2013
Page 35
Water Rate Study 2013/14 Appendix 1 Page 13 Transmission and Distribution Salaries and Benefits Are budgeted to increase by 5% or $184k in 2013/14 over projected 2012/13. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and re-classifications. Training and Development - Training and development expenditures are projected to increase in 2013/14 by 27% or $8.5 k over projected 2012/13 as a result of projected savings in the amount of $10k in 2012/13. This savings is due to deferral of some job related training for staff, originally budgeted in 2012/13, to the 2013/14 fiscal year. Contract Services - Are projected to increase by 48% or $917 k in 2013/14 over projected 2012/13 primarily due to $250k for the inspection of transmission mains, $400k for the rehabilitation of the North Preston reservoir, and $150 k for distribution pipe inspection using smart ball technology. Electricity Is budgeted to increase by 10% or $13k in 2013/14 over projected 2012/13 due to projected consumption and rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services Is budgeted to decrease by 5% or ($39k) in 2013/14 compared to 2012/13 due to a decrease in projected materials required. 2013/14 represents a return to a more normal level of activity. 2012/13 was 30% higher than 2011/12 with increased expenditures on pressure controls, instrumentation, removal of obsolete equipment, hydrants and valve parts and fittings for repairs of pipes. Professional Services Is budgeted to decrease by 46% or ($8.5k) in 2013/14 compared to 2012/13 due to a general ledger reclassification in the amount of $5k. In 2012/13 lease expenses relating to CN and DND had been charged to licenses and agreements. For 2013/14, these expenditures are being charged to the general ledger account labeled lease/ rent expense. Fleet Services Is budgeted to increase 28% or $125k in 2013/14 over projected 2012/13 due to increases in the unit rates to cover the fleet operating costs. Supplementary detail for fleet costs is shown in Appendix 7. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. Chemicals There are no projected expenditures for chemicals for transmission and distribution during the test years.
January 9, 2013
Page 36

Transmission and Distribution

Salaries and Benefits $3,871,576 $4,010,222 $4,194,034 $4,359,993 $138,646 4% $13,341 74% $219,177 13% $19,749 18% $175,209 30% ($3,832) -17% $52,372 13% ($1,638) -100% ($32,093) -17% $72,440 -42% $113,749 29% $767,120 11% $183,812 5% $8,500 27% $916,755 48% $13,242 10% ($39,448) -5% ($8,500) -46% $125,041 28% $0 0% $63,640 42% ($40,476) 41% $15,561 3% $1,238,127 16% $165,959 4% ($3,940) -10% ($87,235) -3% $11,894 8% ($3,690) -1% $24 0% $2,650 0% $0 0% $5,236 2% ($1,165) 1% ($6,117) -1% $83,616 1%
$18,059
$31,400
$39,900
$35,960
Contract Services
$1,673,575
$1,892,752
$2,809,507
$2,722,272
Electricity
$108,647
$128,396
$141,638
$153,532
$586,449
$761,658
$722,210
$718,520
$22,332
$18,500
$10,000
$10,024
Fleet Services
$396,960
$449,332
$574,373
$577,023
Chemicals
$1,638
$0
$0
$0
$184,022
$151,929
$215,569
$220,805
Operating Cost Recoveries
($171,383)
($98,943)
($139,419)
($140,584)
Allocated from Supply and Treatment
$390,136
$503,885
$519,446
$513,329
Total Transmission and Distribution $7,082,011
$7,849,131
$9,087,258
$9,170,874
January 9, 2013
Page 37
Water Rate Study 2013/14 Appendix 1 Page 15 Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Salaries and Benefits Are budgeted to increase 8% or $94 k over 2012/13. 47% relates to changes in the staff complement the addition of a new Utility Technician ($37 k for six months), and a summer student ($7 k). The remainder of the increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and re-classifications. Contract Services - Is projected to increase in 2013/14 by 17% or $2 k over projected 2012/13 due to increasing costs for dealing with graffiti and vandalism, and snow removal and ice control. Electricity Is budgeted to increase in 2013/14 by 16% or $28k compared to 2012/13 based on projected consumption and rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services Is budgeted to increase in 2013/14 by 19% or $19k over projected 2012/13 primarily due to increases in computer software and license requirements in conjunction with carryout out HRWCs SCADA Master plan. Fleet Services - are projected to increase 18% or $36k in 2013/14 over 2012/13 due to increases in the unit rates to cover the fleet operating costs. Supplementary detail for fleet costs is shown in Appendix 7 Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases.
January 9, 2013
Page 38

Technical Services (SCADA)

Salaries and Benefits $1,148,468 $1,220,052 $1,313,790 $1,387,014 $71,584 6% $5,494 41% $3,631 55% $15,374 10% $26,775 38% $23,286 965% $3,823 2% $0 0% ($6,566) -13% ($35,632) 5% $0 0% $107,769 13% $93,738 8% $0 0% $1,700 17% $28,242 16% $18,950 19% ($200) -1% $35,879 18% $0 0% $4,627 10% ($274,999) 33% ($33,528) 0% ($125,591) -13% $73,224 6% $0 0% ($1,425) -12% $20,300 10% $1,000 1% $1,000 4% $15,684 7% $0 0% $1,902 4% ($53,605) 5% ($1,778) 5% $56,302 7%
$13,506
$19,000
$19,000
$19,000
Contract Services
$6,644
$10,275
$11,975
$10,550
Electricity
$158,884
$174,258
$202,500
$222,800
$70,975
$97,750
$116,700
$117,700
$2,414
$25,700
$25,500
$26,500
Fleet Services
$192,115
$195,938
$231,817
$247,501
Chemicals
$0
$0
$0
$0
$52,278
$45,712
$50,339
$52,241
Allocated to Wastewater Services
($785,576)
($821,208)
($1,096,207) ($1,149,812)
Allocated to Stormwater Services
$0
$0
($33,528)
($35,306)
Total Technical Services (SCADA)
$859,708
$967,477
$841,886
$898,188
January 9, 2013
Page 39
Engineering and IS Salaries and Benefits are budgeted to increase 10% or $415k in 2013/14 over 2012/13 due to defined salary increases for existing staff plus four new staff Asset Management Technologist, Development Approvals Engineer, Energy Project Engineer, and a GIS Technician. These positions are required to build capacity to deliver the Integrated Resource Plan. Training and Development - Is budgeted to increase 8% or $21k in 2013/14 over 2012/13 due to specific one-time extra training for IS Technical staff to facilitate a Document Management Project and a Groupwise to Outlook conversion Project. Contract Services Is budgeted to decrease by 30% or ($10.5k) in 2013/14 compared to 2012/13 due to reduction of temporary/contract staff due to addition of permanent staff. Materials, Supplies and Services Materials, Supplies and Services are a large component of Engineering and IS, primarily due to the fact it includes licensing and support costs for corporate software such as SAP costs from the Province of Nova Scotia, and GIS licenses. Materials, Supplies and Services are projected to increase 15% or $231k in 2013/14 over 2012/13 due to additional costs for required software licenses as well as increased printer maintenance within the IS Section. Professional Services Is budgeted to decrease by 16% or ($25k) in 2013/14 compared to 2012/13 due to proposed reduction in consulting service for required energy audits in 2013/14.
January 9, 2013
Page 40
Engineering and IS
Salaries and Benefits $3,955,330 $4,174,004 $4,589,154 $5,007,664 $218,674 6% $122,137 98% ($41,504) -55% $0 0% $417,729 37% $30,903 24% ($2,271) -1% $0 0% $33,315 14% $13,550 -24% ($392,195) 16% ($117,301) 26% $283,037 10% $415,150 10% $20,825 8% ($10,515) -30% $0 0% $231,485 15% ($25,436) -16% $4,204 2% $0 0% $10,569 4% $21,000 -50% ($322,051) 12% ($65,922) 12% $279,309 9% $418,510 9% ($18,400) -7% $1,330 6% $0 0% ($4,207) 0% $32,360 24% $17,192 8% $0 0% ($6,114) -2% $21,000 -100% ($208,154) 7% ($42,613) 7% $210,904 6%
$124,598
$246,735
$267,560
$249,160
Contract Services
$76,014
$34,510
$23,995
$25,325
Electricity
$0
$0
$0
$0
$1,139,816
$1,557,545
$1,789,030
$1,784,823
$127,193
$158,096
$132,660
$165,020
Fleet Services
$215,936
$213,665
$217,869
$235,061
Chemicals
$0
$0
$0
$0
$233,215
$266,530
$277,099
$270,985
($55,550)
($42,000)
($21,000)
$0
($2,402,258) ($2,794,453) ($3,116,504) ($3,324,658)
($454,660)
($571,961)
($637,883)
($680,496)
Total Engineering and IS $2,959,634
$3,242,671
$3,521,980
$3,732,884
January 9, 2013
Page 41
Water Rate Study 2013/14 Appendix 1 Page 19 Environmental Services Salaries and Benefits Are budgeted to increase 13% or $193k in 2013/14 over 2012/13 due to two new positions in Regulatory Compliance, and increases for existing staff due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and re-classifications. . Training and Development - Is budgeted to increase by 30% or $9k in 2013/14 over projected 2012/13 due to conferences and training for new Regulatory Compliance staff. Fleet Services Are budgeted to increase by 63% or $41k in 2013/14 over 2012/13 due to increases in the unit rates to cover the fleet operating costs. Supplementary detail for fleet costs is shown in Appendix 7. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. The majority of this variance is the result of understated expenditures in the 2012/13 projections. Typically this department operates 7-8 fleet vehicles. Based on current rates, the charges on an annual basis range from $87k - $100k. Actual costs for 2012/13 are tracking above the projections, so it would appear that projections have yet to be updated in this category.
January 9, 2013
Page 42

Environmental Services
Salaries and Benefits $1,358,870 $1,457,180 $1,650,614 $1,768,432 $98,310 7% $9,416 44% ($18,325) -3% $0 0% ($5,261) -4% $79,855 132% ($39,608) -38% $0 0% ($8,020) -10% $300 -100% ($72,140) 6% ($53,483) 10% ($8,956) -1% $193,434 13% $9,200 30% $1,918 0% $0 0% ($2,128) -2% $50 0% $41,078 63% $0 0% $9,097 13% $0 0% ($114,613) 9% ($48,375) 9% $89,661 14% $117,818 7% $500 1% ($79,467) -15% $0 0% $2,580 2% $10,000 7% $7,280 7% $0 0% $6,714 8% $0 0% ($35,056) 3% ($18,888) 3% $11,481 2%
$21,284
$30,700
$39,900
$40,400
Contract Services
$529,998
$511,673
$513,591
$434,124
Electricity
$0
$0
$0
$0
$136,471
$131,210
$129,082
$131,662
$60,457
$140,312
$140,362
$150,362
Fleet Services
$104,432
$64,824
$105,902
$113,182
Chemicals
$0
$0
$0
$0
$80,519
$72,499
$81,596
$88,310
($300)
$0
$0
$0
($1,153,180) ($1,225,320) ($1,339,933) ($1,374,989)
($510,572)
($564,055)
($612,430)
($631,318)
Total Environmental Services
$627,979
$619,023
$708,684
$720,165
January 9, 2013
Page 43
Water Rate Study 2013/14 Appendix 1 Page 21 Customer Service Salaries and Benefits Are budgeted to increase by 8% or $187k in 2013/14 over 2012/13 due to normal contract increases, a provision for Non-Union salary increases based on CPI, provision for movement within bands and re-classification of positions, and two new positions. An additional Customer Service Representative is being added to help deal with increasing call volumes, and further increase anticipated as a result of the rate application and implementation of stormwater billing. An additional Appointment Clerk Is being added, funded 50% from capital to enable replacement of meters and conversion of meters to RF at an accelerated rate. Training and Development Is budgeted to increase 117% or $12k in 2013/14 over 2012/13 due to water distribution training and exams for meter staff to retain certification. Contract Services - Is projected to increase in 2013/14 by 10% or $9K over 2012/13 due to increasing postage costs, and additional development costs for billing enhancements (ebilling and additional customer information and service requests via the internet). Fleet Services Fleet Services are budgeted to decrease by 16% or ($44k) in 2013/14 compared to 2012/13 due an overall adjustment in hours which is partially offset by increasing fleet charge rates. Supplementary detail for fleet costs is shown in Appendix 7 Other (Write-off Meters prior to 1985) The write-off for meters from prior to 1985 is projected to decrease by 37% or ($27k) in 2012/13 compared to 2011/12 due to projected year-end allocations based on actual retirements being less than was budgeted. The write-off for meters from prior to 1985 is budgeted to remain at $45,000 for 2013/14 and 2014/15.
January 9, 2013
Page 44

Customer Service
Salaries and Benefits $2,316,153 $2,433,323 $2,620,455 $2,694,063 $117,170 5% $5,498 125% $8,577 11% $0 0% ($24,694) -7% $9,156 35% $47,431 22% $0 0% $15,600 6% ($62,061) 5% ($12,573) 5% ($26,578) -37% $77,526 5% $187,132 8% $11,600 117% $8,772 10% $0 0% $10,084 3% $0 0% ($43,520) -16% $0 0% $25,441 9% ($81,237) 6% ($16,623) 6% $0 0% $101,649 6% $73,608 3% ($10,000) -47% $500 1% $0 0% $3,290 1% $0 0% $0 0% $0 0% ($17,054) -6% ($20,499) 1% ($4,194) 1% $0 0% $25,651 1%
$4,402
$9,900
$21,500
$11,500
Contract Services
$79,676
$88,253
$97,025
$97,525
Electricity
$0
$0
$0
$0
$353,891
$329,197
$339,281
$342,571
$25,844
$35,000
$35,000
$35,000
Fleet Services
$219,921
$267,352
$223,832
$223,832
Chemicals
$0
$0
$0
$0
$261,991
$277,591
$303,032
$285,978
($1,357,222) ($1,419,283) ($1,500,520) ($1,521,019)
($277,838)
($290,411)
($307,034)
($311,228)
Other
$71,578
$45,000
$45,000
$45,000
Total Customer Service $1,698,396
$1,775,922
$1,877,571
$1,903,222
January 9, 2013
Page 45
Water Rate Study 2013/14 Appendix 1 Page 23 Administration and Pension Operating Cost Recoveries - Operating cost recoveries include rental recoveries from other departments and recoveries from Workers Compensation reflect recovery of rent and operating costs for the new Operations Administration Building. Salaries and Benefits - Are budgeted to increase 3% or $279k in 2013/14 over 2012/13 projections due to contract increases, a provision for Non-Union salary increases based on CPI, and addition of two new positions. A webmaster is being hired to enhance communications and services available to customers via the internet, and an administrative assistant is being hired to support the corporate counsel function, regulatory processes and insurance claims administration. In the Security sector, a new position has been created to perform duties associated with security and safety. Training and Development - Is budgeted to increase 27% or $54k in 2013/14 over 2012/13 due to a new Leadership and Supervisory training program being implemented through the Human Resources department, with an expected cost of $40k. In addition, projections for 2012/13 through Administration were reduced by approximately $14k, relating to courses/conferences budgeted but not attended. This is often due to scheduling conflicts between the courses/conferences offered and the availability of staff. Contract Services - Is budgeted to increase 21% or $75k in 2013/14 compared to 2012/13 due to increased expenditures associated with the new building being constructed at Cowie Hill Road. Projections for 2012/13 reflect operations for approximately 3 months, with occupancy expected in January, 2013. The new building has been budgeted under operations for a full year commencing in 2013/14. Electricity - Is budgeted to increase 53% or $56k in 2013/14 over projected 2012/13 due to increased electricity consumption due to the new Operational Administration building, combined with increases in electricity rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services - Are budgeted to increase 26% or $94k in 2013/14 over projected expenditures in 2012/13 largely due to operations and support associated with the new building at Cowie Hill Road, as noted above, totaling $65k. Professional Services - Are budgeted to decrease in 2013/14 by 3% or ($26k) compared to 2012/3 due to projected reduced requirements for external legal services and consulting. Fleet Services - Are projected to increase by 14% or $8k in 2013/14 compared to projected 2012/13 due to a budgeting error which occurred in the 2012/13 fiscal year, in which fleet costs were understated by $6k. The increased shown for 2013/14 is the result of bringing
January 9, 2013
Page 46
Water Rate Study 2013/14 Appendix 1 Page 24 the annual costs in line in conjunction with increases in the unit rates to cover the fleet operating costs. Supplementary detail for fleet costs is shown in Appendix 7. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases.
January 9, 2013
Page 47

Worksheet W-4
January 3, 2013

Administration and Pension

Salaries and Benefits $6,637,187 $8,053,010 $8,331,749 $8,491,507 $1,415,823 21% $56,039 38% $90,708 34% $63,319 149% $103,070 40% ($142,990) -13% ($2,256) -4% $0 0% $29,359 8% $369,237 -26% ($289,690) 110% ($5,593) 27% ($687,035) 24% ($140,284) 24% $859,706 24% $278,739 3% $54,081 27% $75,490 21% $56,071 53% $94,260 26% ($26,244) -3% $7,900 14% $0 0% $406,493 107% ($238,833) 22% ($224,315) 40% $10,000 -38% ($200,987) 6% ($41,125) 6% $251,530 6% $159,758 2% ($20,710) -8% $72,630 17% $12,000 7% ($31,600) -7% ($600) 0% $0 0% $0 0% ($85,584) -11% ($57,452) 4% ($7,828) 1% $0 0% ($16,553) 0% ($3,387) 0% $20,674 0%
$148,040
$204,079
$258,160
$237,450
Contract Services
$268,892
$359,600
$435,090
$507,720
Electricity
$42,610
$105,929
$162,000
$174,000
$258,480
$361,550
$455,810
$424,210
$1,079,990
$937,000
$910,756
$910,156
Fleet Services
$58,076
$55,820
$63,720
$63,720
Chemicals
$0
$0
$0
$0
$349,524
$378,883
$785,376
$699,792
General Overheads applied to all departments
($1,430,744) ($1,061,507) ($1,300,340) ($1,357,792)
Rental Recoveries from other departments
($264,401)
($554,091)
($778,406)
($786,234)
Miscellaneous recoveries
($20,407)
($26,000)
($16,000)
($16,000)
($2,901,987) ($3,589,022) ($3,790,009) ($3,806,562)
($594,095)
($734,379)
($775,504)
($778,891)
Total Administration and Pension $3,631,165
$4,490,872
$4,742,402
$4,763,076
January 9, 2013
Page 48
Worksheet W-5 Cost of Service (COS) Structure

Worksheet W-5 details the customer classifications, cost functions with allocated percentages, service characteristics and operating and capital cost classifications for water services as detailed in the Cost of Service Rate Design Manual.
January 9, 2013
Page 49

Worksheet W-5
Customer Classifications, Cost Functions & Service Characteristics

Customer Classifications Residential SF Residential Multi-Family System Functions Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Commercial Industrial
Non-Residential Institutional Unmetered

Fee Function (Specific
Classification - Service Characteristics Average Day Demand Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect
Operating Cost Classifications

Average Day Demand Function Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General 100.00% 100.00% 100.00% 93.00% 93.00% 32.00% 54.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% MaximumDay Demand 0.00% 0.00% 0.00% 7.00% 7.00% 12.00% 5.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% MaximumHour Demand 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Equivalent Meters 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
Customer Service 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Indirect
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Capital Cost Classifications

Average Day Demand Function Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General
January 9, 2013
MaximumDay Demand 0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
MaximumHour Demand 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Indirect
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
Page 50
Worksheet W-6 Operating Expense Functionalization

Worksheet W-6 details the water service operating expense categories cost elements, by the system functions detailed in the Cost of Service Rate Design Manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet W-10 to allocate the costs to the service characteristics.
January 9, 2013
Page 51

Halifax Regional Water Commission Water Rate Study Statement of Operating Expenditures 2013/14
Test Year #1

Operating Expense Cost Allocation Percent of Costs to Functions 2013/14
OPERATING EXPENSES
2013/14 Budget
ENGINEERING AND IS
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Operating Cost Recoveries Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies $4,589,154 $267,560 $23,995 $0 $1,789,030 $132,660 $217,869 $0 $277,099 ($21,000) ($3,116,504) ($637,883) $3,521,980
Watershed Management 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Dams 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Quality 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Treatment Transmission Distribution 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Storage Tanks 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Hydrants 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Technical Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Customer Service 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meter Reading Engineering Environmental Administration Meters and Billing and IS Services and General 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0%
TOTAL ENGINEERING AND IS
ENVIRONMENTAL SERVICES
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies
$1,650,614 $39,900 $513,591 $0 $129,082 $140,362 $105,902 $0 $81,596 ($1,339,933) ($612,430)

$708,684
Watershed Management 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Dams 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Quality 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Treatment Transmission Distribution 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Storage Tanks 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Hydrants 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Technical Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Customer Service 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meter Reading Engineering Environmental Administration and Billing and IS Services and General 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0%
TOTAL ENVIRONMENTAL SERVICES
CUSTOMER SERVICE
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Write-off on Meters prior to 1985 Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies
$2,620,455 $21,500 $97,025 $0 $339,281 $35,000 $223,832 $0 $303,032 $45,000 ($1,500,520) ($307,034)
$1,877,571
Watershed Management 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Dams 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Quality 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Treatment Transmission Distribution 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Storage Tanks 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Hydrants 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meters 23% 47% 5% 0% 9% 0% 59% 0% 2% 100% 27% 0%
Meter Reading Engineering Environmental Administration and Billing and IS Services and General 25% 0% 0% 0% 0% 0% 0% 0% 63% 0% 0% 0% 0% 0% 0% 0% 70% 0% 0% 0% 0% 0% 0% 0% 34% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 34% 0% 0% 0% 0% 0% 0% 0%
TOTAL CUSTOMER SERVICE
January 9, 2013
Page 52

Test Year #1

OPERATING EXPENSES
2013/14 Budget
ADMINISTRATION AND PENSION

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations General Overheads applied to all departments Rental Recoveries from other departments Miscellaneous recoveries Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies
$8,331,749 $258,160 $435,090 $162,000 $455,810 $910,756 $63,720 $0 $785,376 ($1,300,340) ($778,406) ($16,000) ($3,790,009) ($775,504)
$4,742,402
Watershed Management 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Dams 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Quality 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Treatment Transmission Distribution 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Water Storage Tanks 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Hydrants 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Technical Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Customer Service 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meter Reading Engineering Environmental Administration and Billing and IS Services and General 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100% 0% 0% 0% 100%
TOTAL ADMINISTRATION AND PENSION
TOTAL OPERATING EXPENSE
$28,835,053
January 9, 2013
Page 53

Test Year #1
OPERATING EXPENSES
2013/14 Budget Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Operating Expense Cost Allocation Allocation of Costs to Functions 2013/14
ENGINEERING AND IS
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Operating Cost Recoveries Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies $4,589,154 $267,560 $23,995 $0 $1,789,030 $132,660 $217,869 $0 $277,099 ($21,000) ($3,116,504) ($637,883) $3,521,980
Watershed Management Dams $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment Transmission Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $4,589,154 $267,560 $23,995 $0 $1,789,030 $132,660 $217,869 $0 $277,099 ($21,000) ($3,116,504) ($637,883) $3,521,980
Environmental Administration Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,589,154 $267,560 $23,995 $0 $1,789,030 $132,660 $217,869 $0 $277,099 ($21,000) ($3,116,504) ($637,883) $3,521,980
$1,650,614 $39,900 $513,591 $0 $129,082 $140,362 $105,902 $0 $81,596 ($1,339,933) ($612,430)

$708,684
Watershed Management Dams $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment Transmission Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $1,650,614 $0 $39,900 $0 $513,591 $0 $0 $0 $129,082 $0 $140,362 $0 $105,902 $0 $0 $0 $81,596 $0 ($1,339,933) $0 ($612,430) $0 $708,684 $0
Total $1,650,614 $39,900 $513,591 $0 $129,082 $140,362 $105,902 $0 $81,596 ($1,339,933) ($612,430) $708,684
CUSTOMER SERVICE
$2,620,455 $21,500 $97,025 $0 $339,281 $35,000 $223,832 $0 $303,032 $45,000 ($1,500,520) ($307,034)
$1,877,571
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment Transmission Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $1,369,395 $11,500 $30,625 $0 $71,786 $35,000 $16,352 $0 $296,512 $0 ($591,156) ($307,034) $932,980
Meters $597,615 $10,000 $5,000 $0 $30,224 $0 $131,040 $0 $6,520 $45,000 ($404,858) $0 $420,541
Meter Reading and Billing $653,445 $0 $61,400 $0 $237,271 $0 $76,440 $0 $0 $0 ($504,506) $0 $524,050
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $2,620,455 $21,500 $97,025 $0 $339,281 $35,000 $223,832 $0 $303,032 $45,000 ($1,500,520) ($307,034) $1,877,571
January 9, 2013
Page 54

Test Year #1
OPERATING EXPENSES
2013/14 Budget

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations General Overheads applied to all departments Rental Recoveries from other departments Miscellaneous recoveries Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies
$8,331,749 $258,160 $435,090 $162,000 $455,810 $910,756 $63,720 $0 $785,376 ($1,300,340) ($778,406) ($16,000) ($3,790,009) ($775,504)
$4,742,402
Watershed Management Dams $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment Transmission Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $0 $8,331,749 $0 $258,160 $0 $435,090 $0 $162,000 $0 $455,810 $0 $910,756 $0 $63,720 $0 $0 $0 $785,376 $0 ($1,300,340) $0 ($778,406) $0 ($16,000) $0 ($3,790,009) $0 ($775,504) $0 $4,742,402
Total $8,331,749 $258,160 $435,090 $162,000 $455,810 $910,756 $63,720 $0 $785,376 ($1,300,340) ($778,406) ($16,000) ($3,790,009) ($775,504) $4,742,402
$28,835,053
$353,701
$0
$205,461 $7,496,110
$515,939 $4,856,905 $214,484
$1,471,422
$2,028,508
$841,886
$932,980
$420,541
$524,050
$3,521,980
$708,684
$4,742,402
$28,835,053
January 9, 2013
Page 55
Worksheet W-7 Continuity Schedule Utility Plant in Service

Worksheet W-7 provides additional detail on Funding Utility Plant in Service, Contributed Assets, Projected Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation on transportation equipment.
January 9, 2013
Page 56

Continuity Schedule/ Depreciation for Utility Plant in Service 2013/14
Work in Process approved in Previous Years 2013-14 Projected Retirement of Accumulated Depreciation 2013-14 Projected Net Book Value before Depreciation Mar-14 Calculated Depreciation including Retirements 2013/14
Funded Utility Plant in Service Mar-13
Contributed Portion Mar-13
Total Utility Plant in Service Mar-13
Utility Plant in Service Additions in Contributed in 2013-14 2013-14
Projected Retirements 2013-14
Projected Utility Plant in Service Mar-14
Accumulated Depreciation Mar-13
Accumulated Accumulated Depreciation on Depreciation on funded assets donated assets Mar-13 Mar-13
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Inpounding Small systems Aerotech WTP Other Security
546,019 12,466,399 165,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 5,862,823 35,070,371 16,559,746 4,020,512 12,171,405 2,686,032 1,228,311 34,898 2,100,041 4,009,109 1,148,546 -
972,001 3,172,127 51,962 4,845,934 12,282 -
546,019
50,000 -
546,019
220,091
220,091
325,929
54,602 -
12,466,399 165,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 6,834,824 35,070,371 19,731,873 4,020,512 12,171,405 2,686,032 1,228,311 86,860 2,100,041 8,855,043 1,160,828 -
15,000 -
3,850,000 2,559,000 -
400,000 1,000,000 50,000 3,925,000 -
12,481,399 115,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 7,234,824 36,070,371 19,781,873 4,020,512 19,946,405 5,245,032 1,228,311 86,860 2,100,041 8,855,043 1,160,828 -
170,999 2,111,463 14,295,261 4,339,953 88,440 1,417,816 33,723 363,341 34,513 672,934 1,134,115 207,212 -
170,999 2,099,102 14,295,261 4,248,676 88,440 1,417,816 33,723 363,341 34,513 672,934 436,033 207,212 -
12,361 91,277 698,081 -
12,481,399 115,345 1,064,682 1,076,099 456,440 380,644 271,744 464,519 5,123,362 21,775,109 15,441,920 3,932,072 18,528,588 5,211,309 864,970 52,347 1,427,107 7,720,928 953,616 -
42,644 139,730 544,499 213,404 1,039 307,524 100,895 13,302 8 21,736 152,174 50,494 -
January 9, 2013
Page 57

Work in Process approved in Previous Years 2013-14 1,325,000 7,734,000 Projected Retirement of Accumulated Depreciation 2013-14 Projected Net Book Value before Depreciation Mar-14 100,000 12,000 28,000 110,000 250,000 Calculated Depreciation including Retirements 2013/14 233,487 1,082 1,112,390 46,277 169,982 656,805 26,809 907,318 -
Utility Plant in Service Additions in Contributed in 2013-14 75,000 1,000,000 60,000 252,000 1,630,000 12,305,000 4,440,000 1,100,000 75,000 240,000 26,567,000 2013-14 6,000,000 500,000 1,000,000 7,500,000
Projected Retirements 2013-14 100,000 50,000 200,000 400,000
Equipment Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Transportation Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment Mains Transmission Distribution Meters Hydrants Sprinkler Connections Services Other URBAN CORE SUB-TOTAL
8,182,898 267,860 22,375,694 4,174,541 2,594,582 5,578 75,425 5,101,878 1,971,473 7,958,638 90,785,325 121,253,415 12,589,335 6,636,494 1,865,854 16,532,986 404,326,660
96,227,272 24,613 10,963,792 12,215,997 128,485,980
8,182,898 267,860 22,375,694 4,174,541 2,594,582 5,578 75,425 5,101,878 1,971,473 7,958,638 90,785,325 217,480,687 12,613,948 17,600,286 1,865,854 28,748,983 532,812,640
8,257,898 267,860 23,375,694 4,174,541 2,654,582 5,578 75,425 5,253,878 1,971,473 9,588,638 104,415,325 227,870,687 13,513,948 18,175,286 1,865,854 29,988,983 574,213,640
5,108,832 171,658 13,060,330 3,283,152 1,685,783 5,326 71,994 3,280,285 1,823,902 5,005,505 19,039,757 44,426,099 3,273,064 2,623,956 334,894 3,643,999 131,928,396
5,108,832 171,658 13,060,330 3,283,152 1,685,783 5,326 71,994 3,280,285 1,823,902 5,005,505 17,535,896 40,917,091 3,259,872 1,839,565 334,894 2,211,941 123,884,166
1,503,861 3,509,008 13,193 784,391 1,432,058 8,044,230
3,149,065 96,202 10,315,364 891,389 968,798 252 3,431 2,073,593 147,571 4,583,133 85,387,568 183,472,588 10,350,884 15,551,329 1,530,960 26,344,984 442,535,243
820,871 1,915,367 523,734 86,282 8,771 106,755 8,257,980
January 9, 2013
Page 58
Worksheet W-8 Depreciation Functionalization

Worksheet W-8 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Manual both in a percentage and dollar format. These are then used in Worksheet W-10 to allocate depreciation to the service characteristics. Depreciation on transportation equipment is included in the fleet cost center and is allocated as part of the fleet costs.
January 9, 2013
Page 59

Calculation of Depreciation of Tangible Plant at Total Cost 2013/14 Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed as a Percentage (%) 2013/14
Water Storage Tanks
Worksheet W-8
Annual Depreciation
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Impounding Small systems Aerotech Water Treatment Plant Other - Security EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL
Watershed Management
Dams
Water Quality
Water Treatment
Transmission Distribution
Hydrants
Services
Technical Services
Customer Service
Meters
Meter Reading and Engineering Environmental Administration Billing and IS Services and General
$54,602
Intangible Plant 0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
$0 $0 $0 $0 $0 $0 $0 $42,644 $139,730 $544,499 $213,404 $1,039 $307,524 $100,895 $13,302 $8 $21,736 $152,174 $50,494 $0 $233,487 $1,082 $1,112,390 $46,277 $169,982 $0 $0 $26,809 $907,318 $0 $820,871 $1,915,367 $523,734 $86,282 $8,771 $106,755 $0 $7,601,175
LAND AND LAND RIGHTS 95% 5% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 50% 0% STRUCTURES AND IMPROVEMENTS 0% 50% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 50% 0% 0% 0% 0% 15% 50% 50% 100% 0% 45% 0% 0% 100% 100% 0% 80% 58% 0% 50% 0% 100% 50% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 25% 100% 0% 0% 0% 0% 0% 25% 0% 0% 45% 0% 0% 0% 0% 0% 10% 0% 0% 25% 0% 0% 25% 30% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0%
0% 25% 0% 0% 0% 0% 35% 0% 25% 0% 0% 10% 0% 0% 0% 0% 0% 10% 15% 0% 25% 100% 0% 25% 40% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0%
0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 16% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 4% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0% 0% 0% 7% 100% 0% 0% 0% 0% 0% 100% 0% 100% 50% 100% 0% 0% 0% 0% 0% 0% 100%
January 9, 2013
Page 60

2013/14 Functionalization of Depreciation Expressed in Dollars ($) 2013/14
Worksheet W-8
Annual Depreciation
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Impounding Small systems Aerotech Water Treatment Plant Other - Security EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL Watershed Management Dams Water Quality Water Treatment Transmissio n Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Administrati Reading and Engineering Environment on and Billing and IS al Services General Total
Allocation of Depreciation Costs to Functions

$54,602 Intangible Plant $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $54,602 $54,602
$0 $0 $0 $0 $0 $0 $0 $42,644 $139,730 $544,499 $213,404 $1,039 $307,524 $100,895 $13,302 $8 $21,736 $152,174 $50,494 $0 $233,487 $1,082 $1,112,390 $46,277 $169,982 $0 $0 $26,809 $907,318 $0 $820,871 $1,915,367 $523,734 $86,282 $8,771 $106,755 $0 $7,601,175
LAND AND LAND RIGHTS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 STRUCTURES AND IMPROVEMENTS $0 $21,322 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $21,736 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $43,058 $0 0.00% 0.57% 0.00%
$0 $0 $0 $0 $0 $0 $0 $21,322 $69,865 $544,499 $0 $468 $0 $0 $13,302 $8 $0 $121,739 $29,287 $0 $116,743 $0 $1,112,390 $23,138 $16,998 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,069,759 27.23%
$0 $0 $0 $0 $0 $0 $0 $0 $34,933 $0 $0 $468 $0 $0 $0 $0 $0 $15,217 $0 $0 $58,372 $0 $0 $11,569 $50,995 $0 $0 $0 $0 $0 $820,871 $0 $0 $0 $0 $0 $0 $992,425 13.06%
$0 $0 $0 $0 $0 $0 $0 $0 $34,933 $0 $0 $104 $0 $0 $0 $0 $0 $15,217 $7,574 $0 $58,372 $1,082 $0 $11,569 $67,993 $0 $0 $0 $0 $0 $0 $1,915,367 $0 $0 $0 $0 $0 $2,112,211 27.79%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $213,404 $0 $0 $0 $0 $0 $0 $0 $8,079 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $221,483 2.91%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $16,998 $0 $0 $0 $0 $0 $0 $0 $0 $86,282 $8,771 $0 $0 $112,051 1.47%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $16,998 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $106,755 $0 $123,753 1.63%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 2.98%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,020 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $523,734 $0 $0 $0 $0 $525,754 6.92%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 2.98%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $307,524 $100,895 $0 $0 $0 $0 $3,535 $0 $0 $0 $0 $0 $0 $0 $0 $26,809 $453,659 $0 $0 $0 $0 $0 $0 $0 $0 $947,024 12.46%
$0 $0 $0 $0 $0 $0 $0 $42,644 $139,731 $544,499 $213,404 $1,040 $307,524 $100,895 $13,302 $8 $21,736 $152,173 $50,495 $0 $233,487 $1,082 $1,112,390 $46,276 $169,982 $0 $0 $26,809 $907,317 $0 $820,871 $1,915,367 $523,734 $86,282 $8,771 $106,755 $0 $7,601,176 100.00%
January 9, 2013
Page 61
Worksheet W-9 Allocation of Utility Plant in Service

Worksheet W-9 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of service Manual both in a percentage and dollar format. These are then used in Worksheet W-10 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 62

Halifax Regional Water Commission
Water Rate Study Allocation of Utility Plant in Service 2013/14

Water Rate Study
Worksheet W-9
Allocation of Utility Plant in Service Functionalization of the Rate Base Expressed as a Percentage (%) 2013/14
Projected Utility Plant in Service, end of year Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Impounding Small systems Aerotech Water Treatment Plant Other - Security EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Transportation Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL
Projected Accumulated Depreciation, end of year
Projected Net Book Donated or Value, end of year Contributed Assets
Rate Base (Col F - Col G) $271,327
$546,019
$274,693
$271,327
$0
Watershed Management Intangible Plant 0%
Dams 0%
Water Quality 0%
Water Treatment 0%
Transmission Distribution 0% 0%
Water Storage Tanks 0%
Hydrants 0%
Services 0%
Technical Services 0%
Customer Service 0%
Meters 0%
Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 100%
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $635,519 $7,234,824 $36,070,371 $19,781,873 $4,020,512 $19,946,405 $5,245,032 $1,228,311 $86,860 $2,100,041 $8,855,043 $1,160,828 $0 $8,257,898 $267,860 $23,375,694 $4,174,541 $2,654,582 $5,578 $75,425 $5,253,878 $1,971,473 $9,588,638 $0 $104,415,325 $227,870,687 $13,513,948 $18,175,286 $1,865,854 $29,988,983 $0 $574,213,640
$0 $0 $0 $0 $0 $0 $0 $213,644 $2,251,193 $14,839,760 $4,553,357 $89,479 $1,725,340 $134,617 $376,643 $34,521 $694,670 $1,286,289 $257,706 $0 $5,342,319 $172,740 $14,172,719 $3,329,429 $1,855,765 $5,326 $71,994 $3,837,090 $1,850,710 $5,912,822 $0 $19,848,628 $46,313,466 $3,686,798 $2,710,238 $343,665 $3,750,754 $0 $139,936,377
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $421,875 $4,983,631 $21,230,610 $15,228,516 $3,931,034 $18,221,064 $5,110,415 $851,668 $52,339 $1,405,370 $7,568,754 $903,122 $0 $2,915,578 $95,120 $9,202,974 $845,112 $798,816 $252 $3,431 $1,416,788 $120,762 $3,675,816 $0 $84,566,697 $181,557,222 $9,827,150 $15,465,048 $1,522,189 $26,238,229 $0 $434,277,263
$0 $0 $0 $0 $0 $0 $0 $0 $959,640 $0 $3,080,850 $0 $0 $0 $0 $51,962 $0 $4,147,853 $12,282 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $421,875 $4,023,991 $21,230,610 $12,147,666 $3,931,034 $18,221,064 $5,110,415 $851,668 $377 $1,405,370 $3,420,901 $890,840 $0 $2,915,578 $95,120 $9,202,974 $845,112 $798,816 $252 $3,431 $1,416,788 $120,762 $3,675,816 $0 $84,566,697 $84,342,819 $9,815,729 $4,785,647 $1,522,189 $14,454,290 $0 $306,335,513
Tangible Plant LAND AND LAND RIGHTS 95% 5% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 50% 0% 0% STRUCTURES AND IMPROVEMENTS 0% 50% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 50% 0% 0% 0% 0% 15% 50% 50% 100% 0% 45% 0% 0% 100% 100% 0% 80% 58% 0% 50% 0% 100% 50% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 25% 100% 0% 0% 0% 0% 0% 25% 0% 0% 45% 0% 0% 0% 0% 0% 10% 0% 0% 25% 0% 0% 25% 30% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0%
0% 25% 0% 0% 0% 0% 35% 0% 25% 0% 0% 10% 0% 0% 0% 0% 0% 10% 15% 0% 25% 100% 0% 25% 40% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0%
0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 16% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 4% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0% 0% 0% 7% 100% 0% 0% 0% 0% 0% 100% 0% 100% 100% 50% 100% 0% 0% 0% 0% 0% 0% 100%
$97,214,403 $11,421 $10,679,401 $0 $11,783,939 $0 $127,941,750
January 9, 2013
Page 63


Water Rate Study
Worksheet W-9
Allocation of Utility Plant in Service Functionalization of Rate Base Expressed in Dollars ($) 2013/14
Projected Accumulated Projected Net Depreciation, end of Book Value, end of year year
Donated or Contributed Assets
Rate Base (Col F - Col G) $271,327
$546,019
$274,693
$271,327
$0
Watershed Management Intangible Plant $0
Dams $0
Water Quality $0
Water Treatment $0
Transmission Distribution $0 $0
Water Storage Tanks $0
Hydrants $0
Services $0
Technical Services $0
Customer Service $0
Meters $0
Meter Reading and Engineering Environmental Administration Billing and IS Services and General $0 $0 $0 $271,327
Total $271,327
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $635,519 $7,234,824 $36,070,371 $19,781,873 $4,020,512 $19,946,405 $5,245,032 $1,228,311 $86,860 $2,100,041 $8,855,043 $1,160,828 $0 $8,257,898 $267,860 $23,375,694 $4,174,541 $2,654,582 $5,578 $75,425 $5,253,878 $1,971,473 $9,588,638 $0 $104,415,325 $227,870,687 $13,513,948 $18,175,286 $1,865,854 $29,988,983 $0 $574,213,640
$0 $0 $0 $0 $0 $0 $0 $213,644 $2,251,193 $14,839,760 $4,553,357 $89,479 $1,725,340 $134,617 $376,643 $34,521 $694,670 $1,286,289 $257,706 $0 $5,342,319 $172,740 $14,172,719 $3,329,429 $1,855,765 $5,326 $71,994 $3,837,090 $1,850,710 $5,912,822 $0 $19,848,628 $46,313,466 $3,686,798 $2,710,238 $343,665 $3,750,754 $0 $139,936,377
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $421,875 $4,983,631 $21,230,610 $15,228,516 $3,931,034 $18,221,064 $5,110,415 $851,668 $52,339 $1,405,370 $7,568,754 $903,122 $0 $2,915,578 $95,120 $9,202,974 $845,112 $798,816 $252 $3,431 $1,416,788 $120,762 $3,675,816 $0 $84,566,697 $181,557,222 $9,827,150 $15,465,048 $1,522,189 $26,238,229 $0 $434,277,263
$0 $0 $0 $0 $0 $0 $0 $0 $959,640 $0 $3,080,850 $0 $0 $0 $0 $51,962 $0 $4,147,853 $12,282 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $421,875 $4,023,991 $21,230,610 $12,147,666 $3,931,034 $18,221,064 $5,110,415 $851,668 $377 $1,405,370 $3,420,901 $890,840 $0 $2,915,578 $95,120 $9,202,974 $845,112 $798,816 $252 $3,431 $1,416,788 $120,762 $3,675,816 $0 $84,566,697 $84,342,819 $9,815,729 $4,785,647 $1,522,189 $14,454,290 $0 $306,335,513
Tangible Plant LAND AND LAND RIGHTS $11,857,329 $624,070 $0 $0 $0 $0 $1,076,099 $0 $0 $0 $0 $0 $135,872 $0 STRUCTURES AND IMPROVEMENTS $0 $210,937 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,405,370 $0 $0 $0 $0 $0 $0 EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $13,069,300 $2,240,377 4.27% 0.73%
$0 $0 $0 $0 $0 $0 $0
$0 $57,673 $0 $0 $0 $0 $40,762
$0 $28,836 $1,064,682 $0 $0 $0 $0 $0 $1,005,998 $0 $0 $1,768,965 $0 $0 $0 $0 $0 $342,090 $0 $0 $728,895 $0 $0 $211,278 $239,645 $0 $0 $0 $0 $0 $0 $84,566,697
$0 $28,836 $0 $0 $0 $0 $95,110 $0 $1,005,998 $0 $0 $393,103 $0 $0 $0 $0 $0 $342,090 $133,626 $0 $728,895 $95,120 $0 $211,278 $319,527 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $456,440 $0 $0 $0 $0 $0 $12,147,666 $0 $0 $0 $0 $0 $0 $0 $142,534 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $79,882 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $79,882 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $14,454,290 $0 $14,534,172 4.74%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $918,954 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $35,634 $0 $0 $0 $0 $0 $0 $0 $3,431 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $918,954 $0 $0 $0 $0 $0 $0 $0 $0 $918,954 0.30%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $380,644 $0 $0 $0 $0 $0 $0 $18,221,064 $5,110,415 $0 $0 $0 $0 $62,359 $0 $0 $0 $0 $0 $0 $252 $0 $1,416,788 $120,762 $1,837,908 $0 $0 $0 $0 $0 $0 $0 $0 $27,421,519 8.95%
$12,481,399 $115,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $421,874 $4,023,992 $21,230,610 $12,147,666 $3,931,033 $18,221,064 $5,110,415 $851,668 $377 $1,405,370 $3,420,901 $890,840 $0 $2,915,579 $95,120 $9,202,974 $845,112 $798,818 $252 $3,431 $1,416,788 $120,762 $3,675,816 $0 $84,566,697 $84,342,819 $9,815,729 $4,785,647 $1,522,189 $14,454,290 $0 $306,335,513 100.01%
$0 $210,937 $0 $2,011,996 $0 $21,230,610 $0 $0 $0 $1,768,965 $0 $0 $0 $0 $0 $851,668 $0 $377 $0 $0 $0 $2,736,721 $0 $516,687 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,457,789 $0 $9,202,974 $422,556 $79,882 $0 $0 $0 $0 $0 $0 $0 $0
$97,214,403 $11,421 $10,679,401 $0 $11,783,939 $0 $127,941,750
$0 $84,342,819 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $89,957,086 $87,696,402 29.37% 28.63%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $40,589,597 0.00% 13.25%
$0 $0 $0 $4,785,647 $0 $1,522,189 $0 $0 $0 $0 $12,746,640 $6,387,718 4.16% 2.09%
$0 $9,815,729 $0 $0 $0 $0 $0 $0 $0 $0 $918,954 $9,854,794 0.30% 3.22%
January 9, 2013
Page 64
Worksheet W-10 Cost Classification

Worksheet W-10 details the costs as allocated to the system functions in Worksheet W-6, W-8 and W-9 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Manual. The amounts are then totaled for operation and maintenance and depreciation and are used in Worksheet W-11 to calculate the water unit rate and bill calculation. The plant in service function is also totaled and the percentages by service function are used to allocate the net debt servicing costs also in Worksheet W-11.
January 9, 2013
Page 65

Worksheet W-10
Cost Classification - Percents & Amounts 2013/14

Cost Classifications
Average Day Demand MaximumDay Demand 0.00% 0.00% 0.00% 7.00% 7.00% 12.00% 5.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% MaximumEquivalent Customer Hour Meters Service Demand Classification Percentages 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 0.00% 0.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Classification Percentages $0 $43,058 $0 $2,069,759 $992,425 $2,112,211 $221,483 $112,051 $123,753 $0 $226,829 $525,754 $0 $226,829 $0 $947,024 $7,601,176
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Indirect
Average Day Demand $353,701 $0 $205,461 $6,971,382 $479,823 $1,554,210 $115,821 $0 $0 $210,472 $0 $0 $0 $0 $0 $0
$9,890,870
Maximum-Day Demand $0 $0 $0 $524,728 $36,116 $582,829 $10,724 $0 $0 $210,472 $0 $0 $0 $0 $0 $0

$1,364,869
Maximum-Hour Demand
Equivalent Meters
Customer Service
Fire Protection
Indirect
Total
O&M Expenses by Function

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $353,701 $0 $205,461 $7,496,110 $515,939 $4,856,905 $214,484 $1,471,422 $2,028,508 $841,886 $932,980 $420,541 $524,050 $3,521,980 $708,684 $4,742,402 $28,835,053 100.00% 100.00% 100.00% 93.00% 93.00% 32.00% 54.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Classification Amounts $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,408,502 $0 $0 $30,028 $0 $0 $0 $0 $0 $0 $2,028,508 $0 $210,472 $0 $0 $0 $0 $932,980 $0 $420,541 $0 $0 $0 $524,050 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,649,002 $2,449,049 $1,457,030
$0 $0 $0 $0 $0 $1,311,364 $57,911 $1,471,422 $0 $210,472 $0 $0 $0 $0 $0 $0

$3,051,169
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $3,521,980 $708,684 $4,742,402

$8,973,066
$353,701 $0 $205,461 $7,496,110 $515,939 $4,856,905 $214,484 $1,471,422 $2,028,508 $841,888 $932,980 $420,541 $524,050 $3,521,980 $708,684 $4,742,402 $28,835,055
Depreciation Expenses by Function

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total
Classification Amounts $0 $43,058 $0 $1,717,900 $823,713 $675,908 $119,601 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,380,180
$0 $0 $0 $351,859 $168,712 $253,465 $11,074 $0 $0 $0 $0 $0 $0 $0 $0 $0

$785,110
$0 $0 $0 $0 $0 $612,541 $31,008 $0 $0 $0 $0 $0 $0 $0 $0 $0
$643,549
$0 $0 $0 $0 $0 $0 $0 $0 $123,753 $0 $0 $525,754 $0 $0 $0 $0
$649,507
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 $0 $0 $0 $0 $0
$226,829
$0 $0 $0 $0 $0 $570,297 $59,800 $112,051 $0 $0 $0 $0 $0 $0 $0 $0

$742,148
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $226,829 $0 $947,024
$1,173,853
$0 $43,058 $0 $2,069,759 $992,425 $2,112,211 $221,483 $112,051 $123,753 $0 $226,829 $525,754 $0 $226,829 $0 $947,024 $7,601,176
Plant in Service by Function

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $13,069,300 $2,240,377 $0 $40,589,597 $89,957,086 $87,696,402 $12,746,640 $6,387,718 $14,534,172 $0 $918,954 $9,854,794 $0 $918,954 $0 $27,421,519 $306,335,513
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Classification Percentages
0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
$13,069,300 $2,240,377 $0 $33,689,366 $74,664,381 $28,062,849 $6,883,186 $0 $0 $0 $0 $0 $0 $0 $0 $0

$158,609,459
$0 $0 $0 $6,900,231 $15,292,705 $10,523,568 $637,332 $0 $0 $0 $0 $0 $0 $0 $0 $0

$33,353,836
$0 $0 $0 $0 $0 $25,431,957 $1,784,530 $0 $0 $0 $0 $0 $0 $0 $0 $0
$27,216,487
Classification Amounts $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $14,534,172 $0 $0 $0 $0 $918,954 $9,854,794 $0 $0 $0 $0 $0 $0 $0 $0 $0

$24,388,966 $918,954
$0 $0 $0 $0 $0 $23,678,029 $3,441,593 $6,387,718 $0 $0 $0 $0 $0 $0 $0 $0

$33,507,340
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $918,954 $0 $27,421,519
$28,340,473
$13,069,300 $2,240,377 $0 $40,589,597 $89,957,086 $87,696,403 $12,746,641 $6,387,718 $14,534,172 $0 $918,954 $9,854,794 $0 $918,954 $0 $27,421,519 $306,335,515
51.78%
10.89%
8.88%
7.96%
0.30%
10.94%
9.25%
January 9, 2013
Page 66
Worksheet W-11 Unit Costs and Returns

Worksheet W-11 uses the costs from Worksheet W-10 allocated to the system functions to calculate the unit water rates and fire protection charge for 2013/14 and 2014/15. The percentage of Average Day, Maximum Day, Maximum Hour, Equivalent Meters, Customer Service and Fire Protection is used to allocate the indirect costs for O&M Expenses, Depreciation Expense and Debt service. Grant in Lieu of Taxes/Dividend is allocated based on the debt service allocation. Worksheet W-11 also calculates the return on Rate Base.
January 9, 2013
Page 67

Worksheet W-11
Water Unit Rate and Bill Calculations 2013/14

Unit Cost Calculations
Average Day Demand Revenue Requirements O&M Expenses (including Indirects) Direct Allocation Percentages $9,890,870 49.80% $1,364,869 6.87% $1,649,002 8.30% $2,449,049 12.33% $1,457,030 7.34% $3,051,169 15.36% $8,973,066 $28,835,055 100.00% Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect Total
O&M Expenses by Service Char
$14,359,857
$1,980,968
$2,393,310
$3,555,362
$2,116,493
$4,429,064
$28,835,054
Depreciation Expenses Direct Allocation Percentages Depreciation Expenses by Service Char
$3,380,180 52.58% $3,996,698
$785,110 12.22% $928,864
$643,549 10.01% $760,878
$649,507 10.11% $768,479
$226,829 3.53% $268,322
$742,148 11.55% $877,936
$1,173,853
$7,601,176 100.00% $7,601,177
Plant in Service by Serv Char Percents Debt Service ( Principal, Interest, Fees) $8,745,660 Direct Allocation Percentages Debt Service ( Principal, Interest, Fees) by Service Char
51.78%
10.89%
8.88%
7.96%
0.30%
10.94%
9.25%
100.00%
$4,528,503 57.05%
$952,402 12.00%
$776,615 9.79%
$696,155 8.77%
$26,237 0.33%
$956,775 12.06%
$808,974
$8,745,661 100.00%
$4,989,400
$1,049,479
$856,200
$766,994
$28,861
$1,054,727
$8,745,661
Total Allocated Revenue Requirements
$23,345,955 51.67%
$3,959,311 8.76%
$4,010,388 8.88%
$5,090,835 11.27%
$2,413,676 5.34%
$6,361,727 14.08%
$0
$45,181,892 100.00%
Grant in lieu of Taxes $4,248,816 Less Non-Rate Revenues and Other Adjustments ($2,238,796) ($1,156,786) ($196,119) ($198,805) ($252,312) ($119,552) ($315,222) $0 ($2,238,796) $2,195,363 $372,196 $377,295 $478,842 $226,887 $598,233 $0 $4,248,816
Net Rate Revenue Requirements
$24,384,532
$4,135,388
$4,188,878
$5,317,365
$2,521,011
$6,644,738
$0
$47,191,912
January 9, 2013
Page 68

Worksheet W-11

Average Day Demand Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect Total
Rate Base
$306,335,513
Return on Rate Base Calculated Percent Return on Rate Base
$10,755,681 3.51%
Billing Determinations 36,281,315 Commercial Industrial Institutional
Billable Water Consumption

Percent of Total
Meters / Availability
Annual Equivalents
Customers
Annual
Fire Protection
19.85% 7.25% 16.68%
7,201,841 2,630,395 6,051,723 -
22.92% 33.29% 99.99%
8,315,677 12,078,050 36,277,686 105,106 83,345
Rate Per Billing Unit

Average Per Account / Monthly Residential 15
$0.902
$50.59
$30.25
$6,644,738
$13.52
$4.22
$2.52
$20.26
January 9, 2013
Page 69
Worksheet W-12 Rates, Revenues and Bills

Worksheet W-12 uses the data from Worksheet W-11 to calculate proposed rates for Customer Charge, Base Charge and Volumetric Charges for 2013/14 and 2014/15. Worksheet W-12 also provides a revenue test based on the projected customer connections, equivalent meters and consumption and details the annual fixed charges (base and customer charge) and the annual consumption charge based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 70

Worksheet W-12
Rates, Revenues & Annual Bills by Alternative 2013/14

Proposed Cost of Service Rates and Charges
Customer Charge Base Charge Volumetric Charges Revenue Test Billing Determinant Customer Charge Revenues
Number of Services
$/Account $/Meter Equivalent $ / Billed Cubic Meter
$30.25 $50.59 $0.90
83,345 105,106 36,281,315
$2,521,011 $5,317,365 $32,712,070 $40,550,446 $6,644,738 $47,195,184
Base Charge Revenues

System Equivalents
Volumetric Charges Revenues

Estimated Consumption
Total User Charge Revenues Fire Protection Charges Total Revenues
Bill Calculations
Annual Fixed Charges

(Customer & Base Charges by Meter Size)
Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm Annual Volumetric Charges
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150 $80.84 $106.13 $156.72 $80.84 $106.13 $156.72 $283.20 $434.97 $839.70 $1,295.01 $2,559.77 $4,583.39 $7,618.82
Average Annual Consumption Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM Total Bill - Average Consumption
179 607 1,229 179 607 1,229 2,604 6,489 14,841 36,060 93,171 106,774 43,454
$161.39 $547.29 $1,108.09 $161.39 $547.29 $1,108.09 $2,347.83 $5,850.63 $13,380.99 $32,512.53 $84,005.12 $96,269.90 $39,179.13
Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM
Average Annual Consumption

179 607 1,229 179 607 1,229 2,604 6,489 14,841 36,060 93,171 106,774 43,454
$242.23 $653.42 $1,264.81 $242.23 $653.42 $1,264.81 $2,631.03 $6,285.60 $14,220.69 $33,807.54 $86,564.89 $100,853.29 $46,797.95
January 9, 2013
Page 71
Worksheet W-13 Monthly and Quarterly Change in Water Bills
Worksheet W-13 details the monthly and quarterly change for water service for 2013/14 based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 72
Worksheet W-13
January 3, 2013
Bill Comparisions 2013/14

Average Monthly Consumption
Monthly Base Charge 2013/14 Proposed Rates
Monthly Commodity Charge 2013/14 Proposed Rates
Monthly Water Bill 2013/14 Proposed Rates
Quarterly Water Bill 2013/14 Proposed Rates
Meter Size
Current 14.95 50.57 102.38 14.95 50.57 102.38 217.02 540.79 1,236.75 3,004.96 7,764.24 8,897.86 3,621.17 $12.01 $17.20 $27.58 $12.01 $17.20 $27.58 $53.53 $84.38 $167.73 $261.17 $520.71 $935.99 $1,558.89
% Change
Current $7.61 $25.74 $52.11 $7.61 $25.74 $52.11 $110.46 $275.26 $629.51 $1,529.52 $3,952.00 $4,529.01 $1,843.17
% Change
Current
% Change
Current
% Change
Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm
$6.74 $8.84 $13.06 $6.74 $8.84 $13.06 $23.60 $36.25 $69.97 $107.92 $213.31 $381.95 $634.90
-43.9% -48.6% -52.6% -43.9% -48.6% -52.6% -55.9% -57.0% -58.3% -58.7% -59.0% -59.2% -59.3%
$13.48 $45.62 $92.35 $13.48 $45.62 $92.35 $195.75 $487.79 $1,115.55 $2,710.47 $7,003.34 $8,025.87 $3,266.29
77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2% 77.2%
$19.62 $42.94 $79.69 $19.62 $42.94 $79.69 $163.99 $359.64 $797.24 $1,790.69 $4,472.71 $5,465.00 $3,402.06
$20.22 $54.46 $105.41 $20.22 $54.46 $105.41 $219.35 $524.04 $1,185.52 $2,818.39 $7,216.66 $8,407.82 $3,901.19
3.1% 26.8% 32.3% 3.1% 26.8% 32.3% 33.8% 45.7% 48.7% 57.4% 61.3% 53.8% 14.7%
$58.86 $128.82 $239.07 $58.86 $128.82 $239.07 $491.97 $1,078.92 $2,391.71 $5,372.08 $13,418.12 $16,395.01 $10,206.19
$60.66 $163.38 $316.22 $60.66 $163.38 $316.22 $658.05 $1,572.11 $3,556.57 $8,455.17 $21,649.97 $25,223.47 $11,703.58
3.1% 26.8% 32.3% 3.1% 26.8% 32.3% 33.8% 45.7% 48.7% 57.4% 61.3% 53.8% 14.7%
January 9, 2013
Page 73
Worksheet W-14 Bulk Water Rates

Worksheet W-14 details the calculation of proposed Bulk Water Rates for water sold through HRWC`s bulk water depots for the test years 2013/14 and 2014/15 based on the projected operating and non-operating costs (revenue requirement) and projected water consumption with a 30% mark-up consistent with previous applications
Worksheet W-14
January 3, 2013

Calculation of Bulk Water Rate Years Ending March 31st
Test Year #1 2013/14 Budget $36,436,228 $12,994,476 $49,430,705 36,281,315 Test Year #2 2014/15 Budget $37,887,737 $16,171,527 $54,059,264 35,737,095
2011/12 Actual Cost Base Total Operating Expenses (Rev. Req.) Total Non Operating Expenses (Rev Req) Total Expenses Water Consumption in Cubic Meters Unit Calculations Unit cost per cubic metre Operating cost and profit mark-up Bulk rate per cubic metre $30,484,131 $11,424,488 $41,908,619 37,394,743
1.12 30% 1.46
1.36 30% 1.77
1.51 30% 1.97
January 9, 2013
Page 74
Worksheet Appendix W-1 Additions to Utility Plant in Service

Appendix W-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2013/14. Additions to Utility Plant in Service for 2013/14 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 Capital Budget, and historical levels of contributed utility plant in service. HRWC projects addition of $41,801,000 in assets to Utility Plant in Service during the 2013/14 fiscal year.
January 9, 2013
Page 75

Appendix W-1
Proposed Additions to Utility Plant in Service and Capital Funding 2013/14

Additions to the Utility Plant in Service Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Inpounding Small systems Aerotech Water Treatment Plant Other - Security Equipment Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Transportation Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment Mains Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL Capital Cost Contribution from Others
Utility Cost of Plant in Service
$0
$0
$0
$15,000 $0 $0 $0 $0 $0 $0 $0 $400,000 $1,000,000 $50,000 $0 $7,775,000 $2,559,000 $0 $0 $0 $0 $0 $0 $75,000 $0 $1,000,000 $0 $60,000 $0 $0 $252,000 $0 $1,630,000 $0 $13,630,000 $10,440,000 $1,100,000 $575,000 $0 $1,240,000 $0 $41,801,000
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $6,000,000 $0 $500,000 $0 $1,000,000 $0 $7,500,000
$15,000 $0 $0 $0 $0 $0 $0 $0 $400,000 $1,000,000 $50,000 $0 $7,775,000 $2,559,000 $0 $0 $0 $0 $0 $75,000 $0 $1,000,000 $0 $60,000 $0 $0 $252,000 $0 $1,630,000 $0 $13,630,000 $4,440,000 $1,100,000 $75,000 $0 $240,000 $0 $34,301,000
Sources of Funding
From others Decrease in Working Capital Depreciation fund Reserves (Sale of Land) Long Term Debt TOTAL $7,500,000 $6,519,000 $8,257,980 $2,000,000 $17,524,020 $41,801,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $8,257,980 $8,257,980 -$8,257,980 $0
January 9, 2013
Page 76
Worksheet Appendix W-2 Amortization Schedule for Long Term Debt
Appendix W-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2013/14. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Appendix W-2
December 21, 2012
Amortization Schedule for Projected Long Term Debt 2013/14
Interest Rate Term in years Capital Amortization Schedule Principal Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $876,201.00 $809,609.72 $769,129.24 $728,648.75 $688,168.27 $647,687.78 $607,207.29 $566,726.81 $526,246.32 $485,765.83 $445,285.35 $404,804.86 $364,324.38 $323,843.89 $283,363.40 $242,882.92 $202,402.43 $161,921.94 $121,441.46 $80,960.97 $40,480.49 Interest
4.62% 20 $17,524,020
Total $1,685,810.72 $1,645,330.24 $1,604,849.75 $1,564,369.27 $1,523,888.78 $1,483,408.29 $1,442,927.81 $1,402,447.32 $1,361,966.83 $1,321,486.35 $1,281,005.86 $1,240,525.38 $1,200,044.89 $1,159,564.40 $1,119,083.92 $1,078,603.43 $1,038,122.94 $997,642.46 $957,161.97 $916,681.49
Balance $16,647,819.00 $15,771,618.00 $14,895,417.00 $14,019,216.00 $13,143,015.00 $12,266,814.00 $11,390,613.00 $10,514,412.00 $9,638,211.00 $8,762,010.00 $7,885,809.00 $7,009,608.00 $6,133,407.00 $5,257,206.00 $4,381,005.00 $3,504,804.00 $2,628,603.00 $1,752,402.00 $876,201.00 $0.00
January 9, 2013
Page 77
HRWC Water Rate Study 2014/15
January 9, 2013
Page 78
Notes on Worksheet Worksheet W-1 System Data

Worksheet W-1 provides water system related data including; Water plant production for the three previous fiscal years and 3 year average water plant production. Average day and max day production with related percentages and ratios between the two. Projected service connections, meter equivalents, and billed usage for the 2013/14 and 2014/15 test years. Water consumption history by customer class average for the three fiscal years spanning 2009/10 to 2011/12 including a reallocation of estimated commercial consumption from the residential 15 mm (5/8) meter size. Historical consumption by meter size and customer class for the three previous fiscal years 2009/10, 2010/11 and 2011/12.
January 9, 2013
Page 79

Projected Growth Estimated # of Services 2012/13 320 6 77,417 982 1,523 1,006 748 277 75 37 14 2 82,407
938
# of Services 3/31/2012 320 6 76,567 962 1,508 976 733 272 72 37 14 2 81,469
938
938
Consumption Total Consumption 3/31/2012 60,437 7,866 14,472,108 626,745 1,947,477 2,780,751 5,103,397 4,313,598 2,898,958 3,553,115 1,540,716 89,575 37,394,743
37,020,810 305,630 68,303 37,394,743
Estimated Estimated Estimated Consumption Consumption Consumption 2012/13 2013/14 2014/15 59,530 7,748 14,255,026 617,344 1,918,265 2,739,040 5,026,846 4,248,894 2,855,474 3,499,818 1,517,605 88,231 36,833,822
-1.50%
58,637 7,632 14,041,201 608,084 1,889,491 2,697,954 4,951,443 4,185,161 2,812,642 3,447,321 1,494,841 86,908 36,281,315
-1.50%
57,758 7,517 13,830,583 598,962 1,861,149 2,657,485 4,877,172 4,122,383 2,770,452 3,395,611 1,472,419 85,604 35,737,095
-1.50%
January 9, 2013
Page 80

Water Plant Production and User Characteristics Data
Water Production
2009/10 Average Day Production 2010/11 39,932 86,071 1,026 127,029 2011/12 40,202 82,984 1,083 124,269 Average 40,639 85,920 1,064 127,623 2009/10 2010/11 2011/12 Average Average Day as a Percent of Maximum Day 78.00% 72.00% 80.00% 77.00% 82.00% 80.00% 83.00% 82.00% 60.00% 55.00% 52.00% 55.00% 81.00% 77.00% 82.00% 80.00% Max-Day / Average Day Ratio 1.29 1.38 1.21 1.25 1.68 1.81 1.24 1.30
Lake Major Lake Pockwock Bennery Lake System

Maximum-Day Production Lake Major Lake Pockwock Bennery Lake
41,783 88,705 1,083 131,571
System
53,780 107,706 1,820 163,306
55,140 107,526 1,860 164,526
50,002 99,705 2,090 151,797
52,974 104,979 1,923 159,876
1.24 1.20 1.93 1.22
1.30 1.22 1.81 1.25
Usage Characteristics Service Connections, Equivalents and Billed Usage

Date December 21, 2012 Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 15 MM - 5/8" 20 MM - 3/4" 25 MM - 1" 40 MM - 1.5" 50 MM - 2" 80 MM - 3" 100 MM - 4" 150 MM - 6" 200 MM - 8" 250 MM - 10" TOTAL
2014/15
Number of Services 320 6 79,117 1,022 1,553 1,066 778 287 81 37 14 2 84,283 Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150 System Equivalents 320 0 15 79,117 1,533 3,883 5,330 6,224 4,592 2,025 1,850 1,260 300 106,449
Estimated Consumption (Cubic Meters) 57,758 7,517 13,830,583 598,962 1,861,149 2,657,485 4,877,172 4,122,383 2,770,452 3,395,611 1,472,419 85,604 35,737,095
Test Years 1 2 Current Year Historical Year
2013/14 2014/15 2012/13 2011/12
Customer Classes Residential Non-Residential SF Residential Commercial Multi-Family Industrial Institutional Unmetered
Halifax Water
Consumption Summary Consumption m3 Class
Share
Calculated
Peaking Factors(2)
Loudon Max Day Max Hour
Distrib. Design Factors

Max Day Max Hour
Extra-Capacity
Max Day Max Hour
2009 - 2012
(1)
Realloc. of 5/8" Revised Total
Commercial Industrial Institutional Multi-Family SF Residential
5,439,302 2,774,125 6,385,019 8,772,891 14,829,254
2,155,955
7,595,257 2,774,125 6,385,019 8,772,891 12,673,298
19.85% 7.25% 16.68%
19% 8% 14%
1.22 1.22 1.22 1.22 1.22
1.70 1.70 1.70 1.70 1.70
4,578 1,672 3,849 5,288 7,639
416 152 350 481 694
(2,155,955)
Subtotal Res
Unmetered
70,526 70,526 Total 38,271,118 38,271,118 (1) Water Consumption based on 3 year average spanning fiscal years 2009/10 to 2011/12 inclusive (2) Loudon Report Pages 70-71 Total Non-Residential 14,598,447
22.92% 33.11% 56% 59-66% 0.18%
1.66
2.50
Avg Use
Commercial 5,439,302
Industrial 2,774,125
Institutional 6,385,019
Multi-Family
SF Residential
8,772,891
14,829,254
Total Residential Unmetered 23,602,145 70,526
Total System
38,271,118

Total Residential 14,415,863 357,713 1,137,989 1,332,429 3,153,237 2,112,928 607,914 89,285 15,290 23,222,648 Total Residential 15,114,219 366,585 1,168,580 1,325,283 3,172,142 1,956,296 583,063 93,839 14,200 23,794,207 Total Residential 15,029,337 355,852 1,187,514 1,336,203 3,166,826 1,969,618 622,018 106,942 15,270 23,789,580
Unmetered
Total System 14,532,545 626,745 1,955,343 2,780,751 5,103,397 4,313,598 2,898,958 3,553,115 1,540,716 89,575
43,146 350,337 1,128,643 1,325,009 3,153,237 2,112,928 607,914 89,285 15,290 8,825,789
14,372,717 7,376 9,346 7,420 14,396,859

SF Residential
60,437 7,866 68,303
37,394,743

36,819 359,407 1,159,840 1,322,533 3,172,142 1,956,296 583,063 93,839 14,200 8,698,139
15,077,400 7,178 8,740 2,750 15,096,068

SF Residential
62,320 8,111 70,431
38,174,742

Commercial Meter Size 5/8" 3/4" 1" 1.5" 2" 3" 4" 6" 8" 10" 79,529 252,956 771,854 1,286,519 1,322,027 908,838 662,941 230,010 35,083 74,505 5,624,262 Industrial 1,110 3,889 12,306 29,563 612,263 1,623,826 925,925 179,628 3,388,510 Institutional 4,162 34,361 143,834 215,324 712,625 891,518 522,354 2,670,843 1,159,741 13,910 6,368,672 Total Non-Residential 84,801 287,317 919,577 1,514,149 2,064,215 2,412,619 2,809,121 3,826,778 1,374,452 88,415 15,381,444
49,278 351,443 1,177,510 1,335,841 3,166,826 1,969,618 622,018 106,942 15,270 8,794,746
14,980,059 4,409 10,004 362 14,994,834
64,455 8,389 72,844
39,243,868
January 9, 2013
Page 81
Worksheet W-2 Operations

Worksheet W-2 provides a comparative Statement of Operations for fiscal years ending March 31 as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for water service as per the Audited Financial Statements. Projected results for the current fiscal year (April 1, 2012 to March 31, 2013) for water service, as of November 30, 2012. Budgeted revenue and expenditures for both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at current rates, and separated between regulated and non-regulated services. This worksheet details the projected deficit at current rates in water service for the test years.
Water Services had an excess of revenues over expenditures of $124k for the year ended March 31, 2012, consisting of $191k from the Urban Core System and ($67k) from the Airport Aerotech System as shown on pages 17 and 19 of the Audited Financial Statements respectively (see Appendix 5). This excess represents 0.003% of total revenues. A loss of $742 k (or 0.017% of total revenues) is projected for the current 2012/13 fiscal year, with projections updated as of November 30, 2012. A loss of ($4,342,996) and ($9,247,233) are projected for 2013/14 and 2014/15 respectively. It is important to note that the Operating Statements and Audited Financial Statements include some accrued and unregulated items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet W-3.
January 9, 2013
Page 82
Worksheet W-2 Halifax Regional Water Commission Water Rate Study Comparative Statement of Operations
Fiscal Years ending March 31st 2011/12 Actual OPERATING REVENUES Regulated Activities Metered Sales Public Fire Protection Private Fire Protection Bulk Water Sales Late Payment Fees Miscellaneous Sub-total Unregulated Activities Contract Revenue 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget
$31,098,691 $9,644,048 $365,693 $263,745 $206,781 $124,927 $41,703,885 $36,000 $41,739,885
$33,059,612 $9,999,009 $366,698 $217,667 $249,695 $139,282 $44,031,963 $36,000 $44,067,963
$33,423,695 $10,130,770 $374,088 $243,021 $229,219 $133,710 $44,534,503 $20,580 $44,555,083
$33,091,507 $10,140,535 $379,188 $243,021 $227,486 $133,710 $44,215,447 $21,000 $44,236,447
Total Operating Revenues

OPERATING EXPENDITURES Regulated Activities Supply and Treatment Transmission and Distribution Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Depreciation Sub-total Unregulated Activities Contract Revenue
$7,124,766 $7,082,011 $859,708 $2,959,634 $627,979 $1,698,396 $3,631,165 $6,500,471 $30,484,131 $14,105 $30,498,236 $11,241,650
$7,804,237 $7,849,131 $967,477 $3,242,671 $619,023 $1,775,922 $4,490,872 $6,860,271 $33,609,604 $14,586 $33,624,190 $10,443,773
$8,055,272 $9,087,258 $841,886 $3,521,980 $708,684 $1,877,571 $4,742,402 $7,601,175 $36,436,228 $13,566 $36,449,794 $8,105,289
$8,332,702 $9,170,874 $898,188 $3,732,884 $720,165 $1,903,222 $4,763,076 $8,366,626 $37,887,737 $13,897 $37,901,634 $6,334,813

OPERATING PROFIT (LOSS) NON-OPERATING REVENUES Regulated Activities Investment Income Miscellaneous Sub-total Unregulated Activities Tower Leases Energy Projects (net) Rental Income (net)
$201,358 $21,287 $222,645 $65,501 $0 $19,486 $307,632
$350,000 $51,000 $401,000 $121,536 $0 $16,015 $538,551
$330,000 $51,000 $381,000 $146,105 $12,887 $6,200 $546,192
$330,000 $51,000 $381,000 $156,506 $25,775 $26,200 $589,481
Total
NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Amortization of Bond Discount New Debt - Principal New Debt - Interest New Debt - Principal New Debt - Interest Grant in Lieu of Taxes
$4,932,722 $5,266,136 $5,701,489 $2,496,154 $2,432,869 $2,134,481 $51,850 $53,946 $66,785 $0 $0 $438,101 $0 $0 $404,805 $0 $0 $0 $0 $0 $0 $3,943,762 $3,971,445 $4,248,816 Total $11,424,488 $11,724,396 $12,994,477 $124,794 ($742,072) ($4,342,996) EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES $14,072,695 $14,197,489 $13,455,417 SURPLUS BEGINNING OF THE YEAR $14,197,489 $13,455,417 $9,112,421 ACCUMULATED SURPLUS (DEFICIT)
$6,791,172 $2,668,615 $80,233 $876,201 $769,129 $163,879 $151,424 $4,670,874 $16,171,527 ($9,247,233) $9,112,421 ($134,812)
January 9, 2013
Page 83
Worksheet W-3 Revenue Requirements

Worksheet W-3 takes the operating and non-operating expenditure information from Worksheet W-2 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from fire protection and water service customers. Adjustments are made for the difference in the pension & employee future benefits expense calculation per CICA section 3461 for accounting purposes, and the actual funding required per the current actuarial valuation. As per the Boards direction from the last general rate application, sponsorship and donation expenses and the funding for the Good Neighbours/Help 2 Others (H20 Program), are not included in revenue requirements.
January 9, 2013
Page 84
Worksheet W-3
January 3, 2013

Fiscal Years ending March 31st 2011/12 Actual OPERATING EXPENDITURES Supply and Treatment Transmission and Distribution Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Depreciation 2012/13 Projections Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget
$7,124,766 $7,082,011 $859,708 $2,959,634 $627,979 $1,698,396 $3,631,165 $23,983,660 $6,500,471 $30,484,131
$7,804,237 $7,849,131 $967,477 $3,242,671 $619,023 $1,775,922 $4,490,872 $26,749,333 $6,860,271 $33,609,604
$8,055,272 $9,087,258 $841,886 $3,521,980 $708,684 $1,877,571 $4,742,402 $28,835,053 $7,601,175 $36,436,228
$8,332,702 $9,170,874 $898,188 $3,732,884 $720,165 $1,903,222 $4,763,076 $29,521,111 $8,366,626 $37,887,737
Total
ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Amortization of Bond Discount New Debt - Principal New Debt - Interest New Debt - Principal New Debt - Interest Grant in Lieu of Taxes
$4,932,722 $2,496,154 $51,850 $0 $0 $0 $0 $3,943,762
$5,266,136 $2,432,869 $53,946 $0 $0 $0 $0 $3,971,445 $11,724,396
$5,701,489 $2,134,481 $66,785 $438,101 $404,805 $0 $0 $4,248,816 $12,994,477
$6,791,172 $2,668,615 $80,233 $876,201 $769,129 $163,879 $151,424 $4,670,874 $16,171,527
Total
LESS NON-OPERATING REVENUES Regulated Activities Investment Income Miscellaneous
$11,424,488
$201,358 $21,287
$350,000 $51,000 $401,000
$330,000 $51,000 $381,000
$330,000 $51,000 $381,000
Total
LESS OTHER OPERATING REVENUE Bulk Water Sales Late Payment Fees Miscellaneous
$222,645
$263,745 $206,781 $124,927
$217,667 $249,695 $139,282 $606,644
$243,021 $229,219 $133,710 $605,950
$243,021 $227,486 $133,710 $604,217
Total
LESS OTHER ADJUSTMENTS Pension Adjustment (Water portion - 51%) Sponsorships and Donations (Water portion - 51%)
$595,453
$326,808 $0
$1,224,000 $0 $1,224,000
$1,224,000 $27,846 $1,251,846
$1,224,000 $27,846 $1,251,846
Total
REVENUE REQUIRED FROM FIRE PROTECTION AND WATER CUSTOMERS
$326,808
$40,763,712
$43,102,356
$47,191,909
$51,822,201
January 9, 2013
Page 85
Worksheet W-4 Operating Expenditure Analysis

Worksheet W-4 details the operating expenditures by cost element for each water operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over $20,000 or 5%. Total Operating Expenses were $30,484,131 for 2011/12 and are projected to be $33,609,604 or 10% ($3,125,473) higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $2,826,624 or 8% over 2012/13 for a total of $36,436,228. Increasing depreciation accounts for 26% or $740,904 of the increase in 2013/14. The other primary drivers are salaries and benefits, chemicals, and electricity. Further detailed analysis is provided for each category of water operating expense for the 2013/14 fiscal year within the 2013/14 Rate Study, and within this Rate Study for the 2014/15 fiscal year. Total Operating Expenses in 2014/15 are projected to increase by 4% or $1,451,509 to $37,887,737 in 2014/15 and 53% of the increase is caused by increasing depreciation. The increase in depreciation from 2012/13 to 2013/14 in the amount of $740,904 is primarily the result on capital asset additions in IT, transmission mains (Kearney Lake Road) and buildings, including the Cowie Hill operations facility and the office building expansion. The increase in 2014/15 totaling $765,451 over 2013/14 is driven by the same asset categories, as depreciation is increasing from a half year in 2013/14, to a full year in 2014/15 on these new assets. It should be noted, depreciation for 2014/15 in the amount of $8,366,626 appearing in Worksheet W-4 below differs from the depreciation amount of $8,854,844 shown on Worksheet W-7, Continuity Schedule Utility Plant in Service. The difference of $488,218 relates to depreciation on transportation equipment, which is expenditure with Fleet Services.
January 9, 2013
Page 86

Worksheet W-4
January 3, 2013

Depreciation
Depreciation $6,500,471 $6,860,271 $7,601,175 $8,366,626 $359,800 6% $359,800 6% $740,904 11% $740,904 11% $765,451 10% $765,451 10%
Total Depreciation $6,500,471
$6,860,271
$7,601,175
$8,366,626
$3,125,473 10%
$2,826,624 8%
$1,451,509 4%
January 9, 2013
Page 87
Water Rate Study 2014/15 Appendix 1 Page 11 Supply and Treatment Salaries and Benefits - The 2014/15 costs are projected to increase 3% or $80 k from 2013/14. This reflects the contract increases and a provision for CPI based adjustment for NonUnion staff and movement of staff through salary bands. Electricity Is budgeted to increase 10% or $183k in 2014/15 over 2013/14 based on projected consumption and rate increases. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services Are budgeted to decrease 7% or ($53k) in 2014/15 compared to 2013/14 primarily due to roof repairs totaling $50k at the Lake Lamont treatment facility which were budgeted in 2013/14 and are expected to be completed in the same year, In 2013/14 the Pockwock treatment facility will be in year 2 of a 5 year roof and building envelope plan. Related expenditures associated with this plan are $100k and $60k in 2013/14 and 2014/15 respectively. Professional Services Are budgeted to decrease by 15% or ($53k) in 2014/15 compared to 2013/14 due to continuation of completion of work from the Dam Safety Review and System Assessment Reports; and a lower level of activity than in 2013/14. Chemicals Is budgeted to increase by 5% or $104k in 2014/15 over projected 2013/14, based on current tendered prices and flows based on estimates from chemical providers of 5% increases in chemical prices. Chemicals are tendered annually in January of the year for contracts commencing in April, and a budget risk for HRWC. A separate schedule for projected chemicals expenditures is shown in Appendix 7.
January 9, 2013
Page 88

Worksheet W-4
January 3, 2013

Water Supply and Treatment

Salaries and Benefits $2,345,676 $2,467,540 $2,450,648 $2,531,521 $121,864 5% $17,121 54% $45,470 12% $52,581 3% $173,116 24% $304,982 259% ($43,739) -16% $138,363 7% ($16,539) -13% ($113,749) 29% $679,470 10% ($16,892) -1% $6,770 14% $184,220 42% $162,294 10% ($98,903) -11% ($66,377) -16% $23,721 10% $58,768 3% $12,995 11% ($15,561) 3% $251,035 3% $80,873 3% ($2,500) -5% $14,000 2% $182,474 10% ($53,439) -7% ($52,500) -15% ($5,100) -2% $103,687 5% $3,818 3% $6,117 -1% $277,430 3%
$31,619
$48,740
$55,510
$53,010
Contract Services
$389,023
$434,493
$618,713
$632,713
Electricity
$1,620,574
$1,673,155
$1,835,449
$2,017,923
$714,613
$887,729
$788,826
$735,387
$117,530
$422,512
$356,135
$303,635
Fleet Services
$278,350
$234,611
$258,332
$253,232
Chemicals
$1,887,315
$2,025,678
$2,084,446
$2,188,133
$130,203
$113,664
$126,659
$130,477
Allocated to Transmission and Distribution
($390,136)
($503,885)
($519,446)
($513,329)
Total Water Supply and Treatment $7,124,766
$7,804,237
$8,055,272
$8,332,702
January 9, 2013
Page 89
Water Rate Study 2014/15 Appendix 1 Page 13 Transmission and Distribution Salaries and Benefits Are budgeted to increase by 4% or $166k in 2014/15 over 2013/14. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and re-classifications. There is also a new admin support position budgeted for West operations. Training and Development - Training and development expenditures are projected to decrease in 2014/15 by 10% or ($4k) compared to 2013/14, based on projected staff training requirements. Contract Services Are projected to decrease by 3% or ($87k) in 2014/15 compared to 2013/14 due to the fact the reservoir rehabilitation budgeted for 2014/15 (Waverley) is $100k less than the North Preston reservoir rehabilitation budgeted in 2013/14. Electricity Is budgeted to increase by 8% or $12k in 2014/15 over projected 2013/14 due to projected consumption and rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan.
January 9, 2013
Page 90

Worksheet W-4
January 3, 2013

Transmission and Distribution

Salaries and Benefits $3,871,576 $4,010,222 $4,194,034 $4,359,993 $138,646 4% $13,341 74% $219,177 13% $19,749 18% $175,209 30% ($3,832) -17% $52,372 13% ($1,638) -100% ($32,093) -17% $72,440 -42% $113,749 29% $767,120 11% $183,812 5% $8,500 27% $916,755 48% $13,242 10% ($39,448) -5% ($8,500) -46% $125,041 28% $0 0% $63,640 42% ($40,476) 41% $15,561 3% $1,238,127 16% $165,959 4% ($3,940) -10% ($87,235) -3% $11,894 8% ($3,690) -1% $24 0% $2,650 0% $0 0% $5,236 2% ($1,165) 1% ($6,117) -1% $83,616 1%
$18,059
$31,400
$39,900
$35,960
Contract Services
$1,673,575
$1,892,752
$2,809,507
$2,722,272
Electricity
$108,647
$128,396
$141,638
$153,532
$586,449
$761,658
$722,210
$718,520
$22,332
$18,500
$10,000
$10,024
Fleet Services
$396,960
$449,332
$574,373
$577,023
Chemicals
$1,638
$0
$0
$0
$184,022
$151,929
$215,569
$220,805
($171,383)
($98,943)
($139,419)
($140,584)
Allocated from Supply and Treatment
$390,136
$503,885
$519,446
$513,329
Total Transmission and Distribution $7,082,011
$7,849,131
$9,087,258
$9,170,874
January 9, 2013
Page 91
Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Salaries and Benefits Are budgeted to increase 6% or $73 k over 2013/14. Approximately half of the increase is due to reflection of a full year of salary and benefits for the new Utility Technician to be hired in 2013/14 for six months. The remainder of the increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and re-classifications. Contract Services - Is projected to decrease in 2014/15 by 12% or ($1.4k) compared to 2013/14 due to no snow removal being budgeted for two pumping stations at Bennery Lake for a $1,500 saving. This was an oversight in preparation of the budget, and although it has been flagged since it is over the 5% threshold, the $1,500 variance is not considered material under the circumstances.
Fleet Services - are projected to increase 7% or $16k in 2014/15 over 2013/14 due to increases in the unit rates and assigned hours to cover the fleet operating costs. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. The addition of the new Utility Technician at a full year also results in some projected increase in fleet services.
January 9, 2013
Page 92
Worksheet W-4
January 3, 2013


Salaries and Benefits $1,148,468 $1,220,052 $1,313,790 $1,387,014 $71,584 6% $5,494 41% $3,631 55% $15,374 10% $26,775 38% $23,286 965% $3,823 2% $0 0% ($6,566) -13% ($35,632) 5% $0 0% $107,769 13% $93,738 8% $0 0% $1,700 17% $28,242 16% $18,950 19% ($200) -1% $35,879 18% $0 0% $4,627 10% ($274,999) 33% ($33,528) 0% ($125,591) -13% $73,224 6% $0 0% ($1,425) -12% $20,300 10% $1,000 1% $1,000 4% $15,684 7% $0 0% $1,902 4% ($53,605) 5% ($1,778) 5% $56,302 7%
$13,506
$19,000
$19,000
$19,000
Contract Services
$6,644
$10,275
$11,975
$10,550
Electricity
$158,884
$174,258
$202,500
$222,800
$70,975
$97,750
$116,700
$117,700
$2,414
$25,700
$25,500
$26,500
Fleet Services
$192,115
$195,938
$231,817
$247,501
Chemicals
$0
$0
$0
$0
$52,278
$45,712
$50,339
$52,241
($785,576)
($821,208)
($1,096,207) ($1,149,812)
$0
$0
($33,528)
($35,306)
Total Technical Services (SCADA)
$859,708
$967,477
$841,886
$898,188
January 9, 2013
Page 93
Engineering and IS Salaries and Benefits are budgeted to increase 9% or $418k in 2014/15 over 2013/14 due to defined salary increases for existing staff plus new staff required to build capacity to deliver the Integrated Resource Plan. 2014/15 includes the a full year of salary and benefits for two positions budgeted to be hired for a half year in 2013/14 an Intermediate Engineer and Engineering Technologist both to work on Wet Weather Flow related management and capital projects. New positions in 2014/15, some only for part of the year, are a Junior Engineer to do modeling for Asset Management, a Business Analyst to support Asset Management, and Engineering Technologist to support Water related capital projects, and a GIS programmer/CAD Technician. Training and Development - Is budgeted to decrease 7% or ($18k) in 2014/15 compared to 2013/14 due to completion of specific one-time extra training for IS Technical staff to facilitate a Document Management Project and a Groupwise to Outlook conversion Project in 2013/14. Contract Services Is budgeted to increase by 6% or $1.3k in 2014/15 compared to 2013/14 due to small increases in various contracted services such as courier service. Professional Services Is budgeted to increase by 24% or $32k in 2014/15 compared to 2013/14 due to planned additional consulting services for development of an Energy Management Information System as part of HWRCs Energy Efficiency program.
January 9, 2013
Page 94
Worksheet W-4
January 3, 2013

Engineering and IS
Salaries and Benefits $3,955,330 $4,174,004 $4,589,154 $5,007,664 $218,674 6% $122,137 98% ($41,504) -55% $0 0% $417,729 37% $30,903 24% ($2,271) -1% $0 0% $33,315 14% $13,550 -24% ($392,195) 16% ($117,301) 26% $283,037 10% $415,150 10% $20,825 8% ($10,515) -30% $0 0% $231,485 15% ($25,436) -16% $4,204 2% $0 0% $10,569 4% $21,000 -50% ($322,051) 12% ($65,922) 12% $279,309 9% $418,510 9% ($18,400) -7% $1,330 6% $0 0% ($4,207) 0% $32,360 24% $17,192 8% $0 0% ($6,114) -2% $21,000 -100% ($208,154) 7% ($42,613) 7% $210,904 6%
$124,598
$246,735
$267,560
$249,160
Contract Services
$76,014
$34,510
$23,995
$25,325
Electricity
$0
$0
$0
$0
$1,139,816
$1,557,545
$1,789,030
$1,784,823
$127,193
$158,096
$132,660
$165,020
Fleet Services
$215,936
$213,665
$217,869
$235,061
Chemicals
$0
$0
$0
$0
$233,215
$266,530
$277,099
$270,985
($55,550)
($42,000)
($21,000)
$0
($2,402,258) ($2,794,453) ($3,116,504) ($3,324,658)
($454,660)
($571,961)
($637,883)
($680,496)
Total Engineering and IS $2,959,634
$3,242,671
$3,521,980
$3,732,884
January 9, 2013
Page 95
Water Rate Study 2014/15 Appendix 1 Page 19 Environmental Services Salaries and Benefits Are budgeted to increase 7% or $118k in 2014/15 over 2013/14 due to addition of one new position in Regulatory Compliance an ISO Coordinator, and increases for existing staff due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands and reclassifications. Approximately 64% of this projected increase in salary and benefits relates to the new ISO Coordinator position.
Contract Services - Are budgeted to decrease by 15% or ($79k) in 2014/15 compared to 2013/14 due to completion of the CCME Wastewater Characterizations Chemical and Toxicity Analysis in 2013/14.
Professional Services Are budgeted to increase by 7% or $10k in 2014/15 over 2013/14 due to $10,000 being budgeted in Pollution Prevention relating to a new educational campaign designed to create customer awareness associated aspects of pollution prevention.
January 9, 2013
Page 96

Worksheet W-4
January 3, 2013

Salaries and Benefits $1,358,870 $1,457,180 $1,650,614 $1,768,432 $98,310 7% $9,416 44% ($18,325) -3% $0 0% ($5,261) -4% $79,855 132% ($39,608) -38% $0 0% ($8,020) -10% $300 -100% ($72,140) 6% ($53,483) 10% ($8,956) -1% $193,434 13% $9,200 30% $1,918 0% $0 0% ($2,128) -2% $50 0% $41,078 63% $0 0% $9,097 13% $0 0% ($114,613) 9% ($48,375) 9% $89,661 14% $117,818 7% $500 1% ($79,467) -15% $0 0% $2,580 2% $10,000 7% $7,280 7% $0 0% $6,714 8% $0 0% ($35,056) 3% ($18,888) 3% $11,481 2%
$21,284
$30,700
$39,900
$40,400
Contract Services
$529,998
$511,673
$513,591
$434,124
Electricity
$0
$0
$0
$0
$136,471
$131,210
$129,082
$131,662
$60,457
$140,312
$140,362
$150,362
Fleet Services
$104,432
$64,824
$105,902
$113,182
Chemicals
$0
$0
$0
$0
$80,519
$72,499
$81,596
$88,310
($300)
$0
$0
$0
($1,153,180) ($1,225,320) ($1,339,933) ($1,374,989)
($510,572)
($564,055)
($612,430)
($631,318)
Total Environmental Services
$627,979
$619,023
$708,684
$720,165
January 9, 2013
Page 97
Water Rate Study 2014/15 Appendix 1 Page 21 Customer Service Salaries and Benefits Are budgeted to increase by 3% or $74k in 2014/15 over 2013/14 due to normal contract increases, a provision for Non-Union salary increases based on CPI, provision for movement within bands and re-classification of positions. Training and Development Is budgeted to decrease 47% or ($10k) in 2014/15 over 2013/14 due to the fact that the water distribution training and exams for meter staff to retain certification was completed in 2013/14 is not requited in 2014/15.
January 9, 2013
Page 98

Worksheet W-4
January 3, 2013

Customer Service
Salaries and Benefits $2,316,153 $2,433,323 $2,620,455 $2,694,063 $117,170 5% $5,498 125% $8,577 11% $0 0% ($24,694) -7% $9,156 35% $47,431 22% $0 0% $15,600 6% ($62,061) 5% ($12,573) 5% ($26,578) -37% $77,526 5% $187,132 8% $11,600 117% $8,772 10% $0 0% $10,084 3% $0 0% ($43,520) -16% $0 0% $25,441 9% ($81,237) 6% ($16,623) 6% $0 0% $101,649 6% $73,608 3% ($10,000) -47% $500 1% $0 0% $3,290 1% $0 0% $0 0% $0 0% ($17,054) -6% ($20,499) 1% ($4,194) 1% $0 0% $25,651 1%
$4,402
$9,900
$21,500
$11,500
Contract Services
$79,676
$88,253
$97,025
$97,525
Electricity
$0
$0
$0
$0
$353,891
$329,197
$339,281
$342,571
$25,844
$35,000
$35,000
$35,000
Fleet Services
$219,921
$267,352
$223,832
$223,832
Chemicals
$0
$0
$0
$0
$261,991
$277,591
$303,032
$285,978
($1,357,222) ($1,419,283) ($1,500,520) ($1,521,019)
($277,838)
($290,411)
($307,034)
($311,228)
Other
$71,578
$45,000
$45,000
$45,000
Total Customer Service $1,698,396
$1,775,922
$1,877,571
$1,903,222
January 9, 2013
Page 99
Water Rate Study 2014/15 Appendix 1 Page 23 Administration and Pension Salaries and Benefits - Are budgeted to increase by 2% or $160k in 2014/15 over 2013/14 due to contract increases and a provision for Non-Union salary increases based on CPI. Training and Development - Is budgeted to decrease by 8% or ($21k) in 2014/15 over 2013/14 due to a decrease of $23k in the Human Resources training budget mainly due to the fact that required core safety training is caught up for the organization as a whole, and training will now be cycled and follow a more normal expense pattern. Contract Services - Is budgeted to increase 17% or $73k in 2014/15 compared to 2013/14 due to an increase of $58k in the Human Resources budget due to the hiring of an Occupational Health Professional on a contract basis, and normal inflationary increases in other contracted services. Electricity - Is budgeted to increase 7% or $12k in 2014/15 over projected 2013/14 due to projected electricity consumption combined with increases in electricity rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services - Are budgeted to decrease by 7% or ($32k) in 2014/15 over 2013/14 due to a reduction of $10k in the Human Resources budget as a result of an image writer that was budgeted in 2013/14 that was a one-time purchase. There is also a reduction in the building budget of approximately $21k mainly regarding lower building repairs and maintenance and associated costs relating to the new building.
January 9, 2013
Page 100

Worksheet W-4
January 3, 2013



Salaries and Benefits $6,637,187 $8,053,010 $8,331,749 $8,491,507 $1,415,823 21% $56,039 38% $90,708 34% $63,319 149% $103,070 40% ($142,990) -13% ($2,256) -4% $0 0% $29,359 8% $369,237 -26% ($289,690) 110% ($5,593) 27% ($687,035) 24% ($140,284) 24% $859,706 24% $278,739 3% $54,081 27% $75,490 21% $56,071 53% $94,260 26% ($26,244) -3% $7,900 14% $0 0% $406,493 107% ($238,833) 22% ($224,315) 40% $10,000 -38% ($200,987) 6% ($41,125) 6% $251,530 6% $159,758 2% ($20,710) -8% $72,630 17% $12,000 7% ($31,600) -7% ($600) 0% $0 0% $0 0% ($85,584) -11% ($57,452) 4% ($7,828) 1% $0 0% ($16,553) 0% ($3,387) 0% $20,674 0%
$148,040
$204,079
$258,160
$237,450
Contract Services
$268,892
$359,600
$435,090
$507,720
Electricity
$42,610
$105,929
$162,000
$174,000
$258,480
$361,550
$455,810
$424,210
$1,079,990
$937,000
$910,756
$910,156
Fleet Services
$58,076
$55,820
$63,720
$63,720
Chemicals
$0
$0
$0
$0
$349,524
$378,883
$785,376
$699,792
General Overheads applied to all departments
($1,430,744) ($1,061,507) ($1,300,340) ($1,357,792)
Rental Recoveries from other departments
($264,401)
($554,091)
($778,406)
($786,234)
Miscellaneous recoveries
($20,407)
($26,000)
($16,000)
($16,000)
($2,901,987) ($3,589,022) ($3,790,009) ($3,806,562)
($594,095)
($734,379)
($775,504)
($778,891)
Total Administration and Pension $3,631,165
$4,490,872
$4,742,402
$4,763,076
January 9, 2013
Page 101
Worksheet W-5 Cost of Service (COS) Structure

Worksheet W-5 details the customer classifications, cost functions with allocated percentages, service characteristics and operating and capital cost classifications for water services as detailed in the cost of service manual.
January 9, 2013
Page 102

Worksheet W-5
January 3, 2013
Halifax Regional Water Commission Water Rate Study Customer Classifications, Cost Functions & Service Characteristics
Customer Classifications Residential SF Residential Multi-Family System Functions Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Commercial Industrial
Non-Residential Institutional Unmetered

Fee Function (Specific
Classification - Service Characteristics Average Day Demand Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect
Operating Cost Classifications

Average Maximum- MaximumDay Day Hour Demand Demand Demand Function Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General 100.00% 100.00% 100.00% 93.00% 93.00% 32.00% 54.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 7.00% 7.00% 12.00% 5.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Indirect
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Capital Cost Classifications

Average Maximum- MaximumDay Day Hour Demand Demand Demand Function Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General
January 9, 2013
Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Indirect
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
Page 103
Worksheet W-6 Operating Expense Functionalization

Worksheet W-6 details the water service operating expense categories cost elements, by the system functions detailed in the cost of service manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet W-10 to allocate the costs to the service characteristics.
January 9, 2013
Page 104
January 9, 2013
Page 105
January 9, 2013
Page 106
January 9, 2013
Page 107

Test Year #2

OPERATING EXPENSES
2014/15 Budget Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
SUPPLY AND TREATMENT

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Allocation of Costs to Transmission and Distribution
$2,531,521 $53,010 $632,713 $2,017,923 $735,387 $303,635 $253,232 $2,188,133 $130,477 ($513,329)
$8,332,702
TOTAL SUPPLY AND TREATMENT
Watershed Management Dams $206,739 $0 $8,970 $0 $74,750 $0 $0 $0 $9,348 $0 $58,533 $0 $16,294 $0 $0 $0 $4,683 $0 ($22,759) $0 $356,558 $0
Water Quality $375,481 $8,370 $112,463 $0 $23,270 $78,800 $45,442 $6,000 $29,606 ($475,601) $203,831
Water Treatment Transmission $1,949,301 $0 $35,670 $0 $445,500 $0 $2,017,923 $0 $702,769 $0 $166,302 $0 $191,496 $0 $2,182,133 $0 $96,188 $0 ($14,969) $0 $7,772,313 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $2,531,521 $53,010 $632,713 $2,017,923 $735,387 $303,635 $253,232 $2,188,133 $130,477 ($513,329) $8,332,702
TRANSMISSION AND DISTRIBUTION

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Operating Cost Recoveries Allocation of Costs from Supply and Treatment
$4,359,993 $35,960 $2,722,272 $153,532 $718,520 $10,024 $577,023 $0 $220,805 ($140,584) $513,329
$9,170,874
TOTAL TRANSMISSION AND DISTRIBUTION
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $241,829 $1,419 $164,549 $3,512 $38,491 $233 $28,972 $0 $16,295 ($3,039) $28,898 $521,159
Distribution $2,115,179 $23,266 $1,736,555 $108,564 $376,602 $7,939 $256,095 $0 $118,859 ($115,701) $276,735 $4,904,093
Water Storage Tanks $40,655 $651 $118,060 $26,397 $11,227 $107 $2,741 $0 $4,946 ($1,257) $11,948 $215,476
Hydrants $869,906 $4,466 $221,129 $6,331 $153,562 $734 $122,454 $0 $33,930 ($8,668) $82,413 $1,486,258
Services $1,092,423 $6,157 $481,980 $8,728 $138,639 $1,011 $166,761 $0 $46,775 ($11,920) $113,334 $2,043,888
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,359,992 $35,959 $2,722,273 $153,532 $718,521 $10,024 $577,023 $0 $220,805 ($140,584) $513,329 $9,170,874
TECHNICAL SERVICES (SCADA)

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies $1,387,014 $19,000 $10,550 $222,800 $117,700 $26,500 $247,501 $0 $52,241 ($1,149,812) ($35,306) $898,188
TOTAL TECHNICAL SERVICES (SCADA)
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $1,387,014 $19,000 $10,550 $222,800 $117,700 $26,500 $247,501 $0 $52,241 ($1,149,812) ($35,306) $898,188
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $1,387,014 $19,000 $10,550 $222,800 $117,700 $26,500 $247,501 $0 $52,241 ($1,149,812) ($35,306) $898,188
January 9, 2013
Page 108

Test Year #2
Worksheet W-6
OPERATING EXPENSES
ENGINEERING AND IS
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations Operating Cost Recoveries Allocation of Costs to Wastewater Services Allocation of Costs to Stormwater Servcies $5,007,664 $249,160 $25,325 $0 $1,784,823 $165,020 $235,061 $0 $270,985 $0 ($3,324,658) ($680,496) $3,732,884
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $5,007,664 $249,160 $25,325 $0 $1,784,823 $165,020 $235,061 $0 $270,985 $0 ($3,324,658) ($680,496) $3,732,884
Total $5,007,664 $249,160 $25,325 $0 $1,784,823 $165,020 $235,061 $0 $270,985 $0 ($3,324,658) ($680,496) $3,732,884
$1,768,432 $40,400 $434,124 $0 $131,662 $150,362 $113,182 $0 $88,310 ($1,374,989) ($631,318)

$720,165
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $1,768,432 $0 $40,400 $0 $434,124 $0 $0 $0 $131,662 $0 $150,362 $0 $113,182 $0 $0 $0 $88,310 $0 ($1,374,989) $0 ($631,318) $0 $720,165 $0
Total $1,768,432 $40,400 $434,124 $0 $131,662 $150,362 $113,182 $0 $88,310 ($1,374,989) ($631,318) $720,165
January 9, 2013
Page 109
Test Year #2

OPERATING EXPENSES
CUSTOMER SERVICE
$2,694,063 $11,500 $97,525 $0 $342,571 $35,000 $223,832 $0 $285,978 $45,000 ($1,521,019) ($311,228)
$1,903,222
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $1,405,734 $11,500 $31,125 $0 $71,786 $35,000 $16,352 $0 $279,458 $0 ($596,665) ($311,228) $943,062
Meters $615,903 $0 $5,000 $0 $30,224 $0 $131,040 $0 $6,520 $45,000 ($408,923) $0 $424,764
Meter Reading and Billing $672,426 $0 $61,400 $0 $240,561 $0 $76,440 $0 $0 $0 ($515,431) $0 $535,396
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $2,694,063 $11,500 $97,525 $0 $342,571 $35,000 $223,832 $0 $285,978 $45,000 ($1,521,019) ($311,228) $1,903,222

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies & Services Professional Services & Publicity Fleet Services Chemicals Applied Overheads and Other Allocations General Overheads applied to all departments Rental Recoveries from other departments Miscellaneous recoveries Allocated to Wastewater Services Allocated to Stormwater Services
$8,491,507 $237,450 $507,720 $174,000 $424,210 $910,156 $63,720 $0 $699,792 ($1,357,792) ($786,234) ($16,000) ($3,806,562) ($778,891)
$4,763,076
Watershed Management Dams $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Transmission $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Distribution $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Hydrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Billing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering and IS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Environmental Administration Services and General $0 $8,491,507 $0 $237,450 $0 $507,720 $0 $174,000 $0 $424,210 $0 $910,156 $0 $63,720 $0 $0 $0 $699,792 $0 ($1,357,792) $0 ($786,234) $0 ($16,000) $0 ($3,806,562) $0 ($778,891) $0 $4,763,076
Total $8,491,507 $237,450 $507,720 $174,000 $424,210 $910,156 $63,720 $0 $699,792 ($1,357,792) ($786,234) ($16,000) ($3,806,562) ($778,891) $4,763,076
$29,521,111
$356,558
$0
$203,831
$7,772,313
$521,159
$4,904,093
$215,476
$1,486,258
$2,043,888
$898,188
$943,062
$424,764
$535,396
$3,732,884
$720,165
$4,763,076
$29,521,111
January 9, 2013
Page 110
Worksheet W-7 Continuity Schedule Utility Plant in Service

Worksheet W-7 provides additional detail on Funding Utility Plant in Service, Contributed Assets, Projected Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation of transportation equipment.
January 9, 2013
Page 111

Water Rate Study
Worksheet W-7
Work in Process approved in Previous Years 2014-15 Projected Retirement of Accumulated Depreciation 2014-15 Projected Net Book Value before Depreciation Mar-15 Calculated Depreciation including Retirements 2014/15
Utility Plant in Service Additions in Contributed in 2014-15 2014-15
Projected Retirements 2014-15
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Inpounding Small systems Aerotech WTP Other Security
546,019 12,481,399 115,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 6,262,823 36,070,371 16,609,746 4,020,512 19,946,405 5,245,032 1,228,311 34,898 2,100,041 4,009,109 1,148,546 -
972,001 3,172,127 51,962 4,845,934 12,282 -
546,019
50,000 -
546,019
274,693
274,693
271,327
54,602 -
12,481,399 115,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 7,234,824 36,070,371 19,781,873 4,020,512 19,946,405 5,245,032 1,228,311 86,860 2,100,041 8,855,043 1,160,828 -
215,000 -
750,000 1,500,000 50,000 -
12,696,399 65,345 1,064,682 1,076,099 456,440 380,644 271,744 635,519 7,984,824 37,570,371 19,831,873 4,020,512 19,946,405 5,245,032 1,228,311 86,860 2,100,041 8,855,043 1,160,828 -
213,644 2,251,193 14,839,760 4,553,357 89,479 1,725,340 134,617 376,643 34,521 694,670 1,286,289 257,706 -
213,644 2,238,832 14,839,760 4,462,080 89,479 1,725,340 134,617 376,643 34,521 694,670 588,207 257,706 -
12,361 91,277 698,081 -
12,696,399 65,345 1,064,682 1,076,099 456,440 380,644 271,744 421,875 5,733,631 22,730,610 15,278,516 3,931,034 18,221,064 5,110,415 851,668 52,339 1,405,370 7,568,754 903,122 -
67,309 132,948 564,499 235,791 1,039 351,443 100,895 13,302 8 21,736 149,834 48,382 -
January 9, 2013
Page 112

Water Rate Study
Worksheet W-7
Work in Process approved in Previous Years 2014-15 Projected Retirement of Accumulated Depreciation 2014-15 Projected Net Book Value before Depreciation Mar-15 100,000 12,000 28,000 110,000 250,000 Calculated Depreciation including Retirements 2014/15 213,845 541 1,130,266 46,277 159,433 488,218 6,864 1,390,895 -
Utility Plant in Service Additions in Contributed in 2014-15 735,000 1,080,000 60,000 457,000 2,459,000 1,214,000 5,425,000 1,150,000 75,000 240,000 15,410,000 2014-15 6,000,000 500,000 1,000,000 7,500,000
Projected Retirements 2014-15 100,000 50,000 200,000 400,000
Equipment Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Transportation Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment Mains Transmission Distribution Meters Hydrants Sprinkler Connections Services Other URBAN CORE SUB-TOTAL
8,257,898 267,860 23,375,694 4,174,541 2,654,582 5,578 75,425 5,253,878 1,971,473 9,588,638 104,415,325 125,643,415 13,489,335 6,711,494 1,865,854 16,772,986 438,227,660
102,227,272 24,613 11,463,792 13,215,997 135,985,980
8,257,898 267,860 23,375,694 4,174,541 2,654,582 5,578 75,425 5,253,878 1,971,473 9,588,638 104,415,325 227,870,687 13,513,948 18,175,286 1,865,854 29,988,983 574,213,640
8,992,898 267,860 24,455,694 4,174,541 2,714,582 5,578 75,425 5,610,878 1,971,473 12,047,638 105,629,325 239,245,687 14,463,948 18,750,286 1,865,854 31,228,983 596,723,640
5,342,319 172,740 14,172,719 3,329,429 1,855,765 5,326 71,994 3,837,090 1,850,710 5,912,822 19,848,628 46,313,466 3,686,798 2,710,238 343,665 3,750,754 139,936,377
5,342,319 172,740 14,172,719 3,329,429 1,855,765 5,326 71,994 3,837,090 1,850,710 5,912,822 18,344,767 42,804,457 3,673,605 1,925,847 343,665 2,318,696 131,892,147
1,503,861 3,509,008 13,193 784,391 1,432,058 8,044,230
3,650,578 95,120 10,282,974 845,112 858,816 252 3,431 1,873,788 120,762 6,134,816 85,792,697 192,960,222 10,887,150 16,040,048 1,522,189 27,478,229 457,037,263
867,084 2,023,197 578,628 87,282 8,771 111,755 8,854,844
January 9, 2013
Page 113
Worksheet W-8 Depreciation Functionalization

Worksheet W-8 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Manual both in a percentage and dollar format. These are then used in Worksheet W-10 to allocate depreciation to the service characteristics. Depreciation on transportation equipment is included in the fleet cost center and allocated as part of the fleet costs.
January 9, 2013
Page 114

Calculation of Depreciation of Tangible Plant at Total Cost 2014/15

Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed as a Percentage (%) 2014/15
Water Storage Tanks Meter Reading and Engineering Environmental Administration Billing and IS Services and General
Annual Depreciation
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Impounding Small systems Aerotech Water Treatment Plant Other - Security EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services January 9, 2013 Other TOTAL
Dams
Water Quality
Water Treatment
Hydrants
Services
Technical Services
Customer Service
Meters
$54,602
Intangible Plant 0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
$0 $0 $0 $0 $0 $0 $0 $67,309 $132,948 $564,499 $235,791 $1,039 $351,443 $100,895 $13,302 $8 $21,736 $149,834 $48,382 $0 $213,845 $541 $1,130,266 $46,277 $159,433 $0 $0 $6,864 $1,390,895 $0 $867,084 $2,023,197 $578,628 $87,282 $8,771 $111,755 $0 $8,366,626
LAND AND LAND RIGHTS 95% 5% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 50% 0% 0% STRUCTURES AND IMPROVEMENTS 0% 50% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 50% 0% 0% 0% 0% 15% 50% 50% 100% 0% 45% 0% 0% 100% 100% 0% 80% 58% 0% 50% 0% 100% 50% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 25% 100% 0% 0% 0% 0% 0% 25% 0% 0% 45% 0% 0% 0% 0% 0% 10% 0% 0% 25% 0% 0% 25% 30% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0%
0% 25% 0% 0% 0% 0% 35% 0% 25% 0% 0% 10% 0% 0% 0% 0% 0% 10% 15% 0% 25% 100% 0% 25% 40% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0%
0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 16% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 4% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 115 0%
0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0% 0% 0% 7% 100% 0% 0% 0% 0% 0% 100% 0% 100% 50% 100% 0% 0% 0% 0% 0% 0% 100%
Page


Annual Depreciation
EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL
Watershed Management EQUIPMENT 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0%
Dams
Water Quality
Water Treatment
Hydrants
Services
Technical Services
Customer Service
Meters
$213,845 $541 $1,130,266 $46,277 $159,433 $0 $0 $6,864 $1,390,895 $0 $867,084 $2,023,197 $578,628 $87,282 $8,771 $111,755 $0 $8,366,626
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
50% 0% 100% 50% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
25% 0% 0% 25% 30% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0%
25% 100% 0% 25% 40% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0%
0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 100% 0% 100% 50% 100% 0% 0% 0% 0% 0% 0% 100%
January 9, 2013
Page 116


Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed in Dollars ($) 2014/15
Worksheet W-8
Annual Depreciation
Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Impounding Small systems Aerotech Water Treatment Plant Other - Security
Dams
Water Quality
Water Treatment
Hydrants
Services
Technical Services
Customer Service
Meters
Total
$54,602
Intangible Plant $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$54,602
$54,60
$0 $0 $0 $0 $0 $0 $0 $67,309 $132,948 $564,499 $235,791 $1,039 $351,443 $100,895 $13,302 $8 $21,736 $149,834 $48,382 $0
LAND AND LAND RIGHTS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 STRUCTURES AND IMPROVEMENTS $0 $33,655 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $21,736 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $33,655 $66,474 $564,499 $0 $468 $0 $0 $13,302 $8 $0 $119,867 $28,062 $0
$0 $0 $0 $0 $0 $0 $0 $0 $33,237 $0 $0 $468 $0 $0 $0 $0 $0 $14,983 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $33,237 $0 $0 $104 $0 $0 $0 $0 $0 $14,983 $7,257 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $235,791 $0 $0 $0 $0 $0 $0 $0 $7,741 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,935 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $351,443 $100,895 $0 $0 $0 $0 $3,387 $0
$ $ $ $ $ $ $
$67,31 $132,94 $564,49 $235,79 $1,04 $351,44 $100,89 $13,30 $ $21,73 $149,83 $48,38 $
January 9, 2013
Page 117


Water Storage Tanks $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $243,532 2.91% Meter Reading and Engineering Environmental Administration Billing and IS Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $347,724 $0 $0 $0 $0 $0 $0 $0 $0 $347,724 4.16% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $6,864 $695,448 $0 $0 $0 $0 $0 $0 $0 $0 $1,212,639 14.49%
Worksheet W
Annual Depreciation
EQUIPMENT Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment MAINS Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL $213,845 $541 $1,130,266 $46,277 $159,433 $0 $0 $6,864 $1,390,895 $0 $867,084 $2,023,197 $578,628 $87,282 $8,771 $111,755 $0 $8,366,626
Watershed Management EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 0.00%
Dams $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $55,391 0.66%
Water Quality $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
Water Treatment $106,922 $0 $1,130,266 $23,138 $15,943 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,102,604 25.13%
Transmission Distribution $53,461 $0 $0 $11,569 $47,830 $0 $0 $0 $0 $0 $867,084 $0 $0 $0 $0 $0 $0 $1,028,632 12.29% $53,461 $541 $0 $11,569 $63,773 $0 $0 $0 $0 $0 $0 $2,023,197 $0 $0 $0 $0 $0 $2,208,122 26.39%
Hydrants $0 $0 $0 $0 $15,943 $0 $0 $0 $0 $0 $0 $0 $0 $87,282 $8,771 $0 $0 $111,996 1.34%
Services $0 $0 $0 $0 $15,943 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $111,755 $0 $127,698 1.53%
Technical Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
Customer Service $0 $0 $0 $0 $0 $0 $0 $0 $347,724 $0 $0 $0 $0 $0 $0 $0 $0 $347,724 4.16%
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $578,628 $0 $0 $0 $0 $580,563 6.94%
Total
$213 $ $1,130 $46 $159
$6 $1,390
$867 $2,023 $578 $87 $8 $111
$8,366 100.
January 9, 2013
Page 118
Worksheet W-9 Allocation of Utility Plant in Service

Worksheet W-9 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of service Manual both in a percentage and dollar format. These are then used in Worksheet W-10 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 119


Water Rate Study Worksheet W-9 Functionalization of the Rate Base Expressed as a Percentage (%) 2014/15
Donated or Projected Ner Book Value, end of year Contributed Assets
Rate Base (Col F - Col G)
Watershed Management Intangible Plant 0%
Dams
Water Quality
Water Treatment
Water Storage Tanks
Hydrants
Services
Technical Services
Customer Service
Meters
$546,019
$329,294
$216,725
$0
$216,725
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $635,519 $7,984,824 $37,570,371 $19,831,873 $4,020,512 $19,946,405 $5,245,032 $1,228,311 $86,860 $2,100,041 $8,855,043 $1,160,828 $0 $8,992,898 $267,860 $24,455,694 $4,174,541 $2,714,582 $5,578 $75,425 $5,610,878 $1,971,473 $12,047,638 $0 $105,629,325 $239,245,687 $14,463,948 $18,750,286 $1,865,854 $31,228,983 $0 $596,723,640
$0 $0 $0 $0 $0 $0 $0 $280,953 $2,384,141 $15,404,259 $4,789,148 $90,518 $2,076,783 $235,512 $389,945 $34,529 $716,407 $1,436,123 $306,088 $0 $5,556,164 $173,281 $15,302,986 $3,375,705 $2,015,198 $5,326 $71,994 $4,225,308 $1,857,574 $7,303,718 $0 $20,703,712 $48,308,662 $4,155,426 $2,797,520 $352,435 $3,862,510 $0 $148,541,221
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $354,565 $5,600,683 $22,166,112 $15,042,725 $3,929,995 $17,869,621 $5,009,520 $838,366 $52,331 $1,383,634 $7,418,920 $854,739 $0 $3,436,734 $94,579 $9,152,708 $798,835 $699,384 $252 $3,431 $1,385,570 $113,899 $4,743,921 $0 $84,925,613 $190,937,025 $10,308,522 $15,952,766 $1,513,418 $27,366,474 $0 $448,182,419
$0 $0 $0 $0 $0 $0 $0 $0 $959,640 $0 $3,080,850 $0 $0 $0 $0 $51,962 $0 $4,147,853 $12,282 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $103,214,402 $11,421 $11,179,401 $0 $12,783,939 $0 $135,441,750
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $354,565 $4,641,043 $22,166,112 $11,961,875 $3,929,995 $17,869,621 $5,009,520 $838,366 $369 $1,383,634 $3,271,067 $842,457 $0 $3,436,734 $94,579 $9,152,708 $798,835 $699,384 $252 $3,431 $1,385,570 $113,899 $4,743,921 $0 $84,925,612 $87,722,623 $10,297,101 $4,773,365 $1,513,418 $14,582,535 $0 $312,740,669
Tangible Plant LAND AND LAND RIGHTS 95% 5% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 50% 0% STRUCTURES AND IMPROVEMENTS 0% 50% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 50% 0% 0% 0% 0% 15% 50% 50% 100% 0% 45% 0% 0% 100% 100% 0% 80% 58% 0% 50% 0% 100% 50% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 25% 100% 0% 0% 0% 0% 0% 25% 0% 0% 45% 0% 0% 0% 0% 0% 10% 0% 0% 25% 0% 0% 25% 30% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0%
0% 25% 0% 0% 0% 0% 35% 0% 25% 0% 0% 10% 0% 0% 0% 0% 0% 10% 15% 0% 25% 100% 0% 25% 40% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0%
0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 16% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 4% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 100% 100% 0% 0% 0% 0% 7% 100% 0% 0% 0% 0% 0% 100% 0% 100% 100% 50% 100% 0% 0% 0% 0% 0% 0% 100%
January 9, 2013
Page 120
January 9, 2013
Page 121


Water Rate Study Worksheet W-9 Functionalization of Rate Base Expressed in Dollars ($) 2014/15
Donated or Projected Ner Book Value, end of year Contributed Assets
Watershed Management Intangible Plant $0
Dams
Water Quality
Water Treatment
Water Storage Tanks
Hydrants
Services
Technical Services
Customer Service
Meters
Total
$546,019
$329,294
$216,725
$0
$216,725
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$216,725
$216,725
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $635,519 $7,984,824 $37,570,371 $19,831,873 $4,020,512 $19,946,405 $5,245,032 $1,228,311 $86,860 $2,100,041 $8,855,043 $1,160,828 $0 $8,992,898 $267,860 $24,455,694 $4,174,541 $2,714,582 $5,578 $75,425 $5,610,878 $1,971,473 $12,047,638 $0 $105,629,325 $239,245,687 $14,463,948 $18,750,286 $1,865,854 $31,228,983 $0 $596,723,640
$0 $0 $0 $0 $0 $0 $0 $280,953 $2,384,141 $15,404,259 $4,789,148 $90,518 $2,076,783 $235,512 $389,945 $34,529 $716,407 $1,436,123 $306,088 $0 $5,556,164 $173,281 $15,302,986 $3,375,705 $2,015,198 $5,326 $71,994 $4,225,308 $1,857,574 $7,303,718 $0 $20,703,712 $48,308,662 $4,155,426 $2,797,520 $352,435 $3,862,510 $0 $148,541,221
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $354,565 $5,600,683 $22,166,112 $15,042,725 $3,929,995 $17,869,621 $5,009,520 $838,366 $52,331 $1,383,634 $7,418,920 $854,739 $0 $3,436,734 $94,579 $9,152,708 $798,835 $699,384 $252 $3,431 $1,385,570 $113,899 $4,743,921 $0 $84,925,613 $190,937,025 $10,308,522 $15,952,766 $1,513,418 $27,366,474 $0 $448,182,419
$0 $0 $0 $0 $0 $0 $0 $0 $959,640 $0 $3,080,850 $0 $0 $0 $0 $51,962 $0 $4,147,853 $12,282 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $103,214,402 $11,421 $11,179,401 $0 $12,783,939 $0 $135,441,750
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $354,565 $4,641,043 $22,166,112 $11,961,875 $3,929,995 $17,869,621 $5,009,520 $838,366 $369 $1,383,634 $3,271,067 $842,457 $0 $3,436,734 $94,579 $9,152,708 $798,835 $699,384 $252 $3,431 $1,385,570 $113,899 $4,743,921 $0 $84,925,612 $87,722,623 $10,297,101 $4,773,365 $1,513,418 $14,582,535 $0 $312,740,669
Tangible Plant LAND AND LAND RIGHTS $12,061,579 $634,820 $0 $0 $0 $0 $1,076,099 $0 $0 $0 $0 $0 $135,872 $0 STRUCTURES AND IMPROVEMENTS $0 $177,283 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,383,634 $0 $0 $0 $0 $0 $0 EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 $13,273,550 4.24% $0 $0 $0 $0 $0 $0 $2,195,737 0.70%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $32,673 $0 $0 $0 $0 $40,762 $177,283 $2,320,521 $22,166,112 $0 $1,768,498 $0 $0 $838,366 $369 $0 $2,616,854 $488,625 $0 $1,718,367 $0 $9,152,708 $399,418 $69,938 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $41,790,494 13.36%
$0 $16,336 $1,064,682 $0 $0 $0 $0 $0 $1,160,261 $0 $0 $1,768,498 $0 $0 $0 $0 $0 $327,107 $0 $0 $859,183 $0 $0 $199,709 $209,815 $0 $0 $0 $0 $0 $0 $84,925,612
$0 $16,336 $0 $0 $0 $0 $95,110
$0 $0 $0 $0 $456,440 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $69,938 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $69,938 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $33,698 $0 $0 $0 $0 $0 $0 $0 $3,431 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,185,980 $0 $0 $0 $0 $0 $0 $0 $0 $1,185,980 0.38%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $380,644 $0 $0 $0 $0 $0 $0 $17,869,621 $5,009,520 $0 $0 $0 $0 $58,972 $0 $0 $0 $0 $0 $0 $252 $0 $1,385,570 $113,899 $2,371,960 $0 $0 $0 $0 $0 $0 $0 $0 $27,407,163 8.76%
$12,696,399 $65,345 $1,064,682 $1,076,099 $456,440 $380,644 $271,744 $354,566 $4,641,043 $22,166,112 $11,961,875 $3,929,995 $17,869,621 $5,009,520 $838,366 $369 $1,383,634 $3,271,068 $842,457 $0 $3,436,733 $94,579 $9,152,708 $798,836 $699,382 $252 $3,431 $1,385,570 $113,899 $4,743,920 $0 $84,925,612 $87,722,623 $10,297,101 $4,773,365 $1,513,418 $14,582,535 $0 $312,740,668 99.99%
$0 $0 $1,160,261 $0 $0 $0 $0 $11,961,875 $392,999 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $327,107 $0 $126,369 $134,793 $0 $0 $859,183 $94,579 $0 $199,709 $279,753 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,185,980 $0 $0 $0 $0 $0 $0
$0 $87,722,623
$0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $90,531,203 $91,274,029 $12,553,108 28.95% 29.19% 4.01%
$0 $0 $4,773,365 $0 $1,513,418 $0 $0 $14,582,535 $0 $0 $6,356,721 $14,652,473 2.03% 4.69%
$0 $0 $10,297,101 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,185,980 $10,334,230 0.00% 0.38% 3.30%
January 9, 2013
Page 122
Worksheet W-10 Cost Classification

Worksheet W-10 details the costs as allocated to the system functions in Worksheets W-6, W-8 and W-9 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Rate Design Manual. The amounts are then totaled for operation and maintenance and depreciation and are used in Worksheet W-11 to calculate the water unit rate and bill calculation. The plant in service function is also totaled and the percentages by service function are used to allocate the net debt servicing costs also in Worksheet W-11.
January 9, 2013
Page 123

Worksheet W-10
Cost Classification - Percents & Amounts 2014/15

Average Day Demand MaximumDay Demand 0.00% 0.00% 0.00% 7.00% 7.00% 12.00% 5.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% MaximumEquivalent Customer Hour Meters Service Demand Classification Percentages 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 0.00% 0.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Fire Protection 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Indirect Average Day Demand $356,558 $0 $203,831 $7,228,251 $484,678 $1,569,310 $116,357 $0 $0 $224,547 $0 $0 $0 $0 $0 $0
$10,183,532
Maximum-Day MaximumDemand Hour Demand $0 $0 $0 $544,062 $36,481 $588,491 $10,774 $0 $0 $224,547 $0 $0 $0 $0 $0 $0

$1,404,355
Equivalent Meters
Customer Service
Fire Protection $0 $0 $0 $0 $0 $1,324,105 $58,178 $1,486,258 $0 $224,547 $0 $0 $0 $0 $0 $0

$3,093,088
Indirect
Total

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $356,558 $0 $203,831 $7,772,313 $521,159 $4,904,093 $215,476 $1,486,258 $2,043,888 $898,188 $943,062 $424,764 $535,396 $3,732,884 $720,165 $4,763,076 $29,521,111 100.00% 100.00% 100.00% 93.00% 93.00% 32.00% 54.00% 0.00% 0.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Classification Amounts $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,422,187 $0 $0 $30,167 $0 $0 $0 $0 $0 $0 $2,043,888 $0 $224,547 $0 $0 $0 $0 $943,062 $0 $424,764 $0 $0 $0 $535,396 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,676,901 $2,468,652 $1,478,458
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $3,732,884 $720,165 $4,763,076

$9,216,125
$356,558 $0 $203,831 $7,772,313 $521,159 $4,904,093 $215,476 $1,486,258 $2,043,888 $898,188 $943,062 $424,764 $535,396 $3,732,884 $720,165 $4,763,076 $29,521,111
Depreciation Expenses by Function

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $0 $55,391 $0 $2,102,604 $1,028,632 $2,208,122 $243,532 $111,996 $127,698 $0 $347,724 $580,563 $0 $347,724 $0 $1,212,639 $8,366,625
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
Classification Amounts $0 $55,391 $0 $1,745,161 $853,765 $706,599 $131,507 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,492,423
$0 $0 $0 $357,443 $174,867 $264,975 $12,177 $0 $0 $0 $0 $0 $0 $0 $0 $0

$809,462
$0 $0 $0 $0 $0 $640,355 $34,094 $0 $0 $0 $0 $0 $0 $0 $0 $0
$674,449
$0 $0 $0 $0 $0 $0 $0 $0 $127,698 $0 $0 $580,563 $0 $0 $0 $0
$708,261
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $347,724 $0 $0 $0 $0 $0
$347,724
$0 $0 $0 $0 $0 $596,193 $65,754 $111,996 $0 $0 $0 $0 $0 $0 $0 $0

$773,943
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $347,724 $0 $1,212,639
$1,560,363
$0 $55,391 $0 $2,102,604 $1,028,632 $2,208,122 $243,532 $111,996 $127,698 $0 $347,724 $580,563 $0 $347,724 $0 $1,212,639 $8,366,625
Plant in Service by Function

Watershed Management Dams Water Quality Water Treatment Transmission Distribution Water Storage Tanks Hydrants Services Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $13,273,550 $2,195,737 $0 $41,790,494 $90,531,203 $91,274,029 $12,553,108 $6,356,721 $14,652,473 $0 $1,185,980 $10,334,230 $0 $1,185,980 $0 $27,407,163 $312,740,668
100.00% 100.00% 100.00% 83.00% 83.00% 32.00% 54.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 17.00% 17.00% 12.00% 5.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 29.00% 14.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 27.00% 27.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00%
$13,273,550 $2,195,737 $0 $34,686,110 $75,140,898 $29,207,689 $6,778,678 $0 $0 $0 $0 $0 $0 $0 $0 $0

$161,282,662
$0 $0 $0 $7,104,384 $15,390,305 $10,952,883 $627,655 $0 $0 $0 $0 $0 $0 $0 $0 $0

$34,075,227
$0 $0 $0 $0 $0 $26,469,468 $1,757,435 $0 $0 $0 $0 $0 $0 $0 $0 $0
$28,226,903
Classification Amounts $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $14,652,473 $0 $0 $0 $0 $1,185,980 $10,334,230 $0 $0 $0 $0 $0 $0 $0 $0 $0

$24,986,703 $1,185,980
$0 $0 $0 $0 $0 $24,643,988 $3,389,339 $6,356,721 $0 $0 $0 $0 $0 $0 $0 $0

$34,390,048
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,185,980 $0 $27,407,163
$28,593,143
$13,273,550 $2,195,737 $0 $41,790,494 $90,531,203 $91,274,028 $12,553,107 $6,356,721 $14,652,473 $0 $1,185,980 $10,334,230 $0 $1,185,980 $0 $27,407,163 $312,740,666
51.57%
10.90%
9.03%
7.99%
0.38%
11.00%
9.14%
January 9, 2013
Page 124
Worksheet W-11 Unit Costs and Returns

Worksheet W-11 uses the costs from Worksheet W-10 allocated to the system functions to calculate the unit water rates and fire protection charge for 2013/14 and 2014/15. The percentage of Average Day, Maximum Day, Maximum Hour, Equivalent Meters, Customer Service and Fire Protection is used to allocate the indirect costs for O&M Expenses, Depreciation Expense and Debt service. Grant in Lieu of Taxes/Dividend is allocated based on the debt service allocation. Worksheet W-11 also calculates the return on Rate Base.
January 9, 2013
Page 125

Worksheet W-11
January 3, 2013
Halifax Regional Water Commission Water Rate Study Water Unit Rate and Bill Calculations 2014/15
Average Day Demand Revenue Requirements O&M Expenses (including Indirects) Direct Allocation Percentages $10,183,532 50.15% $1,404,355 6.92% $1,676,901 8.26% $2,468,652 12.16% $1,478,458 7.28% $3,093,088 15.23% $9,216,125 $29,521,111 100.00% Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect Total
O&M Expenses by Service Char
$14,804,837
$2,042,861
$2,438,444
$3,589,767
$2,149,137
$4,496,065
$29,521,111
Depreciation Expenses Direct Allocation Percentages Forgiveness on Calculatated Depreciation Rate Depreciation Expenses by Service Char
$3,492,423 51.31%
$809,462 11.89%
$674,449 9.91%
$708,261 10.41%
$347,724 5.11%
$773,943 11.37%
$1,560,363
$8,366,625 100.00%
$4,292,915
$994,792
$829,133
$870,966
$427,535
$951,285
$8,366,626
Plant in Service by Serv Char Percents Debt Service ( Principal, Interest, Fees) $11,500,653 Direct Allocation Percentages Debt Service ( Principal, Interest, Fees) by Service Char
51.56%
10.90%
9.03%
7.99%
0.38%
11.00%
9.14%
100.00%
$5,929,737 56.74%
$1,253,571 12.00%
$1,038,509 9.94%
$918,902 8.79%
$43,702 0.42%
$1,265,072 12.11%
$1,051,160
$11,500,653 100.00%
$6,525,471
$1,380,078
$1,143,165
$1,010,907
$48,303
$1,392,729
$11,500,653

January 9, 2013
$25,623,223 51.89%
$4,417,731 8.94%
$4,410,742 8.93%
$5,471,640 11.08%
$2,624,975 5.31%
$6,840,079 13.85%
$0
$49,388,390 100.00%
Page 126

Worksheet W-11
January 3, 2013

Average Day Demand Grant in lieu of Taxes $4,670,874 Less Non-Rate Revenues and Other Adjustments ($2,237,063) ($1,160,812) ($199,993) ($199,770) ($247,867) ($118,788) ($309,833) $0 ($2,237,063) $2,423,717 $417,576 $417,109 $517,533 $248,023 $646,916 $0 $4,670,874 Maximum-Day Demand Maximum-Hour Demand Equivalent Meters Customer Service Fire Protection Indirect Total
$26,886,128
$4,635,314
$4,628,081
$5,741,306
$2,754,210
$7,177,162
$0
$51,822,201
Rate Base
$312,740,669
Return on Rate Base
$13,934,464
Calculated Percent Return on Rate Base 4.46%
Billing Determinations 35,737,095 Commercial Industrial Institutional
Billable Water Consumption

Percent of Total
Meters / Availability
Annual Equivalents
Customers
Annual
Fire Protection
19.85% 7.25% 16.68%
7,093,813 2,590,939 5,960,947 -
22.92% 33.29% 99.99%
8,190,942 11,896,879 35,733,520 106,449 84,283

Average Per Account / Monthly Residential 15
$1.012
$53.94
$32.68
$7,177,162
$15.17
$4.49
$2.72
$22.39
January 9, 2013
Page 127
Worksheet W-12 Rates, Revenues and Bills

Worksheet W-12 uses the data from Worksheet W-11 to calculate proposed rates for Customer Charge, Base Charge and Volumetric Charges for 2013/14 and 2014/15. Worksheet W-12 also provides a revenue test based on the projected customer connections, equivalent meters and consumption and details the annual fixed charges (base and customer charge) and the annual consumption charge based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 128

Worksheet W-12

Customer Charge Base Charge Volumetric Charges $/Account $/Meter Equivalent $ / Billed Cubic Meter $32.68 $53.94 $1.01
Revenue Test Billing Determinant Customer Charge Revenues

Number of Services
84,283 106,449 35,737,095
$2,754,210 $5,741,306 $36,153,140 $44,648,656 $7,177,162 $51,825,818
Base Charge Revenues

System Equivalents
Volumetric Charges Revenues

Total User Charge Revenues Fire Protection Charges Total Revenues
Bill Calculations Annual Fixed Charges

Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm Annual Volumetric Charges
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150
$86.61 $113.58 $167.52 $86.61 $113.58 $167.52 $302.35 $464.16 $895.64 $1,381.05 $2,729.43 $4,886.83 $8,122.94
Average Annual Consumption Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM Total Bill - Average Consumption Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM Average Annual Consumption
175 586 1,198 175 586 1,198 2,493 6,269 14,364 34,203 91,773 105,173 42,802 175 586 1,198 175 586 1,198 2,493 6,269 14,364 34,203 91,773 105,173 42,802
$177.04 $592.82 $1,211.95 $177.04 $592.82 $1,211.95 $2,522.02 $6,341.98 $14,531.22 $34,601.18 $92,841.40 $106,397.40 $43,300.29
$263.65 $706.40 $1,379.47 $263.65 $706.40 $1,379.47 $2,824.37 $6,806.14 $15,426.86 $35,982.23 $95,570.83 $111,284.23 $51,423.23
January 9, 2013
Page 129
Worksheet W-13 Monthly and Quarterly Change in Water Bills
Worksheet W-13 details the monthly and quarterly change for water service for 2014/15 based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 130
Worksheet W-13
January 3, 2013

Monthly Base Charge 2013/14 Proposed Rates 2014/15 Proposed Rates
Monthly Commodity Charge 2013/14 Proposed Rates $13.14 $44.05 $90.08 $13.14 $44.05 $90.08 $187.39 $471.21 $1,079.67 $2,570.93 $6,898.29 $7,905.49 $3,217.28 2014/15 Proposed Rates
Monthly Water Bill 2013/14 Proposed Rates 2014/15 Proposed Rates
Quarterly Water Bill 2013/14 Proposed Rates 2014/15 Proposed Rates
Meter Size
% Change
% Change
% Change
% Change
Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm
14.57 48.84 99.87 14.57 48.84 99.87 207.75 522.40 1,196.98 2,850.26 7,647.77 8,764.40 3,566.83
$6.74 $8.84 $13.06 $6.74 $8.84 $13.06 $23.60 $36.25 $69.97 $107.92 $213.31 $381.95 $634.90
$7.22 $9.47 $13.96 $7.22 $9.47 $13.96 $25.20 $38.68 $74.64 $115.09 $227.45 $407.24 $676.91
7.1% 7.0% 6.9% 7.1% 7.0% 6.9% 6.8% 6.7% 6.7% 6.6% 6.6% 6.6% 6.6%
$14.74 $49.43 $101.07 $14.74 $49.43 $101.07 $210.24 $528.67 $1,211.34 $2,884.46 $7,739.55 $8,869.57 $3,609.64
12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2% 12.2%
$19.88 $52.90 $103.14 $19.88 $52.90 $103.14 $210.99 $507.46 $1,149.65 $2,678.85 $7,111.61 $8,287.44 $3,852.19
$21.96 $58.89 $115.03 $21.96 $58.89 $115.03 $235.43 $567.35 $1,285.98 $2,999.55 $7,967.00 $9,276.81 $4,286.55
10.5% 11.3% 11.5% 10.5% 11.3% 11.5% 11.6% 11.8% 11.9% 12.0% 12.0% 11.9% 11.3%
$59.63 $158.69 $309.43 $59.63 $158.69 $309.43 $632.96 $1,522.37 $3,448.94 $8,036.55 $21,334.82 $24,862.31 $11,556.56
$65.88 $176.67 $345.08 $65.88 $176.67 $345.08 $706.30 $1,702.06 $3,857.93 $8,998.65 $23,901.00 $27,830.42 $12,859.64
10.5% 11.3% 11.5% 10.5% 11.3% 11.5% 11.6% 11.8% 11.9% 12.0% 12.0% 11.9% 11.3%
January 9, 2013
Page 131
Worksheet W-14 Bulk Water Rates

Worksheet W-14 details the calculation of proposed Bulk Water Rates for water sold through HRWC`s bulk water depots for the test years 2013/14 and 2014/15 based on the projected operating and non-operating costs (revenue requirement) and projected water consumption with a 30% mark-up consistent with previous applications
Worksheet W-14
January 3, 2013

Calculation of Bulk Water Rate Years Ending March 31st
2011/12 Actual Cost Base Total Operating Expenses (Rev. Req.) Total Non Operating Expenses (Rev Req) Total Expenses Water Consumption in Cubic Meters Unit Calculations Unit cost per cubic metre Operating cost and profit mark-up Bulk rate per cubic metre 30,484,131 11,424,488 41,908,619 37,394,743 2013/14 Budget 36,436,228 12,994,477 49,430,705 36,281,315 2014/15 Budget 37,887,737 16,171,527 54,059,264 35,737,095
1.12 30% 1.46
1.36 30% 1.77
1.51 30% 1.97
January 9, 2013
Page 132
Worksheet Appendix W-1 Additions to Utility Plant in Service

Appendix W-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2014/15. Additions to Utility Plant in Service for 2014/15 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 and 2014/15 Capital Budget, and historical levels of contributed utility plant in service. HRWC projects addition of $22,910,000 in assets to Utility Plant in Service during the 2014/15 fiscal year.
January 9, 2013
Page 133

Appendix W-1
December 21, 2012
Proposed Additions to Water Utility Plant in Service and Capital Funding 2014/15
Additions to the Utility Plant in Service Intangible Plant Organization and Working Capital Tangible Plant LAND AND LAND RIGHTS Source of Supply Land Power and pumping Transmission Right of Ways Water Rights Reservoir Land Office Land Land Access STRUCTURES AND IMPROVEMENTS Source of Supply Structures Power and Pumping Structures Purification Structures Distribution Reservoirs and Standpipes General Office Building Stores and Garage Settling Ponds Intakes Collection and Inpounding Small systems Aerotech Water Treatment Plant Other - Security Equipment Electrical Pumping Gas Pumping Purification Equipment Information Technology Tools and Work Equipment General Equipment Meter Shop Equipment Transportation Equipment Office Furniture and Equipment Computer Equipment and Software Other Equipment Mains Transmission Distribution Meters Hydrants Sprinkler Connections Services Other TOTAL Capital Cost Contribution from Others
$0
$0
$0
$215,000 $0 $0 $0 $0 $0 $0 $0 $750,000 $1,500,000 $50,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $735,000 $0 $1,080,000 $0 $60,000 $0 $0 $457,000 $0 $2,459,000 $0 $1,214,000 $11,425,000 $1,150,000 $575,000 $0 $1,240,000 $0 $22,910,000
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $6,000,000 $0 $500,000 $0 $1,000,000 $0 $7,500,000
$215,000 $0 $0 $0 $0 $0 $0 $0 $750,000 $1,500,000 $50,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $735,000 $0 $1,080,000 $0 $60,000 $0 $0 $457,000 $0 $2,459,000 $0 $1,214,000 $5,425,000 $1,150,000 $75,000 $0 $240,000 $0 $15,410,000
Sources of Funding
From others Capital from Operating Surplus Depreciation fund Capital from Revenue Long Term Debt TOTAL $7,500,000 $0 $8,854,844 $0 $6,555,156 $22,910,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $8,854,844 $8,854,844 -$8,854,844 $0
January 9, 2013
Page 134
Worksheet Appendix W-2 Amortization Schedule for Long Term Debt
Appendix W-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2014/15. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Appendix W-2
December 21, 2012
4.62% 20 $6,555,156
Total $630,606.01 $615,463.60 $600,321.19 $585,178.78 $570,036.37 $554,893.96 $539,751.55 $524,609.13 $509,466.72 $494,324.31 $479,181.90 $464,039.49 $448,897.08 $433,754.67 $418,612.26 $403,469.85 $388,327.44 $373,185.03 $358,042.62 $342,900.21
Balance $6,227,398.20 $5,899,640.40 $5,571,882.60 $5,244,124.80 $4,916,367.00 $4,588,609.20 $4,260,851.40 $3,933,093.60 $3,605,335.80 $3,277,578.00 $2,949,820.20 $2,622,062.40 $2,294,304.60 $1,966,546.80 $1,638,789.00 $1,311,031.20 $983,273.40 $655,515.60 $327,757.80 $0.00
January 9, 2013
Page 135
Wastewater Rate Study 2013/14 Appendix 2A Page 1
2013/14 HRWC Wastewater Rate Study
January 9, 2013
Page 136
Notes on Worksheet Worksheet WW-1 System Data

Worksheet WW-1 provides data on various wastewater related data including; Wastewater estimated flow summary for the 2012 fiscal year. Projected service connections and estimated effluent billing consumption for the test years 2013/14 and 2014/15. Plant Balance by customer class for the year ending March 31, 2012. Average effluent loading for residential and non-residential customers for the March 31, 2012 fiscal year.
January 9, 2013
Page 137

Projected Growth Estimated # of Services 2012/13 997 0 73,575 962 1,504 997 735 268 74 36 13 2 79,163
938
# of Services 3/31/2012 997 0 72,725 942 1,489 967 720 263 71 36 13 2 78,225
Projected # of Services 2013/14 997 0 74,425 982 1,519 1,027 750 273 77 36 13 2 80,101
938
938
Consumption
Total Consumption 3/31/2012 270,376 0 13,727,544 617,859 1,935,239 2,761,252 5,012,044 4,075,328 2,558,947 3,487,340 1,540,656 89,575 36,076,160
Estimated Estimated Estimated Consumption Consumption Consumption 2012/13 2013/14 2014/15 266,320 0 13,521,631 608,591 1,906,210 2,719,833 4,936,863 4,014,198 2,520,563 3,435,030 1,517,546 88,231 35,535,018
-1.50%
262,326 0 13,318,806 599,462 1,877,617 2,679,036 4,862,810 3,953,985 2,482,754 3,383,504 1,494,783 86,908 35,001,992
-1.50%
258,391 0 13,119,024 590,470 1,849,453 2,638,850 4,789,868 3,894,675 2,445,513 3,332,752 1,472,361 85,604 34,476,962
-1.50%
35,962,294 283,373 270,376 36,516,043 -439,883 36,076,160
January 9, 2013
Page 138

Halifax Regional Water Commission Wastewater Rate Study Worksheet WW-1 User Characteristics and Plant Balance Analysis
SCENARIO SUMMARY Customer Class Date Test Years
1 2 January 3, 2013
Flow Summary (ML) 2012 13,657 8,785 5,167 2,435 6,201 270 36,516
2013/14 2014/15 2012/13 2011/12
Current Year Budget (Projections) Historical Year
Residential (Single Family) Residential (Multi-family) Commercial Industrial Institutional Unmetered Subtotal Customer Other Flow Infiltation & Inflow Stormwater Subtotal Other Total Estimated
Projected Service Connections, Equivalents and Billed Water Consumption 2013/14 Number of Services 997 74425 982 1519 1027 750 273 77 36 13 2 80,101 System Equivalents 997 0 0 74,425 1,473 3,798 5,135 6,000 4,368 1,925 1,800 1,170 300 101,391 Estimated Consumption (Cubic Meters) 262,326 0 0 13,318,806 599,462 1,877,617 2,679,036 4,862,810 3,953,985 2,482,754 3,383,504 1,494,783 86,908 35,001,991
43,908
Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm TOTAL
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150
43,908 80,424
Halifax Dartmouth Other Plants Total Plants Total Other Flow
38,620 21,554 20,251 80,424 55%
Plant Balance Flow Customer Class Residential Non-Residential Overstrength Surcharge Hauled Waste Subtotal Customer Other Flow Subtotal Other Total Estimated Total Plants
ML kg
BOD
mg/l kg
TSS
mg/l
Other User Characteristics Customer Equivalent Meters Service

Annual Equivalents Annual
22,713 13,803 499 77 36,516 43,908 43,908 80,424
3,861,213 2,975,393 1,262,827 19,318 8,118,751 1,097,704 1,097,704 9,216,455 9,216,455
170 216 2,533 250
3,861,213 4,658,871 247,779 11,591 8,779,454 1,097,704 25 115 1,097,704 9,877,158 9,877,158
170 338 497 150
75,422 25,969
75,422 4,679
Dwelling Unit Characteristics 25 25 25 123

Assume all 5/8" customers are Residential Assume 65% of Dwelling Units are single family
Single family Dwelling Units Multi family Dwelling Units
Total Dwelling Units
75,422 40,612 116,034
Residential Non-Residential
Cubic Meters 196 2,950
Average Per Dwelling Unit for Residential and Per Account for Non Residential KG KG 33.32 33.32 635.90 995.70
January 9, 2013
Page 139
Worksheet WW-2 Operations

Worksheet WW-2 provides a comparative Statement of Operations for fiscal years ending March 31 as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for wastewater service as per the Audited Financial Statements. Projected results for the current fiscal year (April 1, 2012 to March 31, 2013) for wastewater service, as of November 30, 2012. Budgeted revenue and expenditures for both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at current rates, and separated between regulated and non-regulated services. This worksheet details the projected deficit at current rates in water service for the test years.
Wastewater Services had a small profit on both regulated and non-regulated operations of $731k at March 31, 2012. The small profit represented 0.014% of total revenues. A loss of ($425k) (or 0.007% of total revenues) is projected for the current year 2012/13 as of November 30, 2012. A loss of ($10,124,734) and ($21,519,384) are projected for 2013/14 and 2014/15 respectively. It is important to note that the Operating Statements and Audited Financial Statements include some accrued and unregulated items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet WW-3.
January 9, 2013
Page 140

Halifax Regional Water Commission Wastewater Rate Study Worksheet WW-2
Comparative Statement of Operations
Fiscal Years ending March 31st 2011/12 Actual OPERATING REVENUES Regulated Activities Base and Effluent Charges Overstrength Surcharge Late Payment Fees Other - Miscellaneous Sub-total Unregulated Activities Contract Revenue AeroTech Septage Tipping Fees Airline Effluent Dewatering Facility/ Sludge Lagoon Sub-total Total Operating Revenues OPERATING EXPENDITURES Regulated Activities Wastewater Collection Wastewater Treatment Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Calculated Depreciation Rate Sub-total Unregulated Activities Wastewater Treatment Total Operating Expenditures OPERATING PROFIT (LOSS) NON-OPERATING REVENUES Regulated Activities Provincial Funding - Harbour Solutions Interest and other income Other - Miscellaneous Sub-total Unregulated Activities Other - Miscellaneous Total Non-Operating Revenues NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt - Principal (2013/14) New Debt - Interest (2013/14) New Debt - Principal (2014/15) New Debt - Interest (2014/15) Total Non-Operating Expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES SURPLUS (DEFICIT) BEGINNING OF THE YEAR ACCUMULATED SURPLUS (DEFICIT) 2012/13 Projections Test Year #1 2013/14 Budget Test Year #2 2014/15 Budget
$49,569,355 $165,016 $130,099 $102,874 $49,967,344 $807,100 $746,557 $39,780 $97,850 $1,691,287 $51,658,631
$53,556,225 $204,000 $160,397 $128,300 $54,048,922 $499,203 $600,000 $74,284 $182,255 $1,355,742 $55,404,664
$54,426,473 $180,000 $148,916 $128,300 $54,883,689 $437,343 $715,000 $94,283 $209,673 $1,456,299 $56,339,988
$53,536,002 $180,000 $146,614 $128,300 $53,990,916 $440,640 $715,000 $94,283 $209,673 $1,459,596 $55,450,512
$9,834,870 $16,482,747 $785,576 $2,402,259 $1,153,180 $1,357,222 $2,902,046 $4,915,898 $39,833,798 $630,689 $40,464,487 $11,194,144
$9,520,468 $16,321,315 $821,208 $2,794,937 $1,225,320 $1,419,283 $3,589,022 $7,566,629 $43,258,182 $778,243 $44,036,425 $11,368,239
$10,190,002 $18,034,505 $1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $10,400,339 $49,622,486 $1,609,478 $51,231,964 $5,108,024
$10,506,453 $18,569,091 $1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $11,947,954 $52,357,548 $1,027,489 $53,385,037 $2,065,475
$2,000,000 $201,136 $22,821 $2,223,957 $63,717 $2,287,674
$2,000,000 $350,000 $24,000 $2,374,000 $55,368 $2,429,368
$2,000,000 $330,000 $24,000 $2,354,000 $57,178 $2,411,178
$2,000,000 $330,000 $24,000 $2,354,000 $58,036 $2,412,036
$7,546,404 $5,192,341 $12,321 $0 $0 $0 $0 $12,751,066 $730,752 $2,629,047 $3,359,799
$8,867,984 $5,317,789 $36,892 $0 $0 $0 $0 $14,222,665 ($425,058) $3,359,799 $2,934,741
$9,314,418 $4,621,837 $66,658 $1,892,424 $1,748,600 $0 $0 $17,643,937 ($10,124,734) $2,934,741 ($7,189,993)
$11,031,603 $6,808,175 $102,493 $3,784,848 $3,322,339 $492,431 $455,006 $25,996,895 ($21,519,384) ($7,189,993) ($28,709,377)
January 9, 2013
Page 141
Worksheet WW-3 Revenue Requirements

Worksheet WW-3 takes the operating and non-operating expenditure information from Worksheet WW-2 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from customer rates. Adjustments are made for the difference in the pension & employee future benefits expense calculation per CICA section 3461 for accounting purposes, and the actual funding required per the current actuarial valuation. Additionally, adjustments are made for debt servicing payments for Eastern Passage WWTF which was pre-financed. HRWC accrues this debt servicing for accounting purposes, but will not include the debt servicing payments in the revenue requirements until the asset is in service. As per the Boards direction from the last general rate application, sponsorship and donation expenses and the funding for the Good Neighbours/Help 2 Others (H20 Program), are not included in revenue requirements. This indirectly impacts Wastewater Services through the allocation from Administration and Pension.
January 9, 2013
Page 142

Fiscal Years ending March 31st 2011/12 Actual OPERATING EXPENDITURES Wastewater Collection Wastewater Treatment Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Calculated Depreciation Rate Total ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt - Principal (2013/14) New Debt - Interest (2013/14) New Debt - Principal (2014/15) New Debt - Interest (2014/15) Total LESS NON-OPERATING REVENUES Regulated Activities Provincial Funding - Harbour Solutions Interest and other income Other - Miscellaneous Total LESS OTHER OPERATING REVENUE Regulated Activities Overstrength Surcharge Late Payment Fees Other - Miscellaneous Total LESS OTHER ADJUSTMENTS Debt Serving (Pre-Financing) Pension Adjustment ($2.4M x 40.67%) Sponsorships and Donations (Wastewater portion 40.67%) $9,834,870 $16,482,747 $785,576 $2,402,259 $1,153,180 $1,357,222 $2,902,046 $34,917,900 $4,915,898 $39,833,798 2012/13 Projections $9,520,468 $16,321,315 $821,208 $2,794,937 $1,225,320 $1,419,283 $3,589,022 $35,691,553 $7,566,629 $43,258,182 Test Year #1 2013/14 Budget $10,190,002 $18,034,505 $1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $39,222,147 $10,400,339 $49,622,486 Test Year #2 2014/15 Budget $10,506,453 $18,569,091 $1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $40,409,594 $11,947,954 $52,357,548
$7,546,404 $5,192,341 $12,321 $0 $0 $0 $0 $12,751,066
$8,867,984 $5,317,789 $36,892 $0 $0 $0 $0 $14,222,665
$9,314,418 $4,621,837 $66,658 $1,892,424 $1,748,600 $0 $0 $17,643,937
$11,031,603 $6,808,175 $102,493 $3,784,848 $3,322,339 $492,431 $455,006 $25,996,895
$2,000,000 $201,136 $22,821 $2,223,957
$2,000,000 $350,000 $24,000 $2,374,000
$2,000,000 $330,000 $24,000 $2,354,000
$2,000,000 $330,000 $24,000 $2,354,000
$165,016 $130,099 $102,874 $397,989
$0 $499,203 $0 $499,203
$180,000 $148,916 $128,300 $457,216
$180,000 $146,614 $128,300 $454,914
$0 $260,613 $0 $260,613
$0 $976,080 $0 $976,080
$1,799,000 $976,080 $22,206 $2,797,286
$0 $976,080 $22,206 $998,286
REVENUE REQUIRED FROM CUSTOMERS
$49,702,304
$53,631,564
$61,657,920
$74,547,243
January 9, 2013
Page 143
Worksheet WW-4 Operating Expenditure Analysis

Worksheet WW-4 details the operating expenditures by cost element for each wastewater operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over $20,000 or 5%. Costs for stormwater service are shown in a separate rate study. Total Operating Expenses were $39,833,798 for 2011/12 and are projected to be $43,258,182 or 9% ($3,424,384) higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $6,369,304 or 15% over 2012/13 for a total of $49,627,486 in total Operating Expenses. Increasing depreciation accounts for 45% or $2,838,710 of the increase in 2013/14. The other primary drivers are salaries and benefits, chemicals, contract services and electricity. Further detailed analysis is provided for each category of the wastewater operating expense. The increase in depreciation from 2012/13 to 2013/14 in the amount of $2,838,710 is driven by depreciation on assets currently under construction, notably the Eastern Passage Wastewater Treatment Facility, which is anticipated to be completed during 2013/14, and IT capital which has a short useful life. Also included are the first additions associated with the Integrated Resource Plan (IRP), including treatment plants/ equipment, transportation equipment and IT. Finally, this is the first year in which depreciation on the regulatory asset has been included in operating expenses, which amounts to $189,929. It should be noted, depreciation for 2013/14 in the amount of $10,400,339 appearing in Worksheet WW-4 below differs from the depreciation amount of $10,883,974 (including depreciation on the Regulatory Asset) shown of Worksheet WW-7, Continuity Schedule Utility Plant in Service. The difference of $483,635 relates to depreciation on transportation equipment, which is expenditure within Fleet Services.
Worksheet WW-4
January 3, 2013
Halifax Regional Water Commission Wastewater Rate Study

(excluding depreciation expense)

2011/12 Actual 2012/13 Projections $7,566,629 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $10,400,339 $11,947,954 ( year over year - $ and % ) 2012/13 Projections $2,650,731 54% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $2,833,710 37% $1,547,615 15%
Depreciation
$4,915,898
$3,424,384 9%
$6,364,304 15%
$2,735,062 6%
January 9, 2013
Page 144
Wastewater Rate Study 2013/14 Appendix 2A Page 10 Wastewater Collection Salaries and Benefits - The 2013/14 costs are budgeted to increase 1% or $42k from 2012/13. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. This increase is lower than what would normally be expected, and this is due to the fact that Wastewater and Stormwater Collection draw from the same wage pool, with staff allocated accordingly. In 2012/13 budgeted hours for Wastewater and Stormwater Collections resulted in a 54% and 46% split respectively. For 2013/14 Wastewater Collection dropped to 49% and Stormwater Collection increased to 51% of the allocated hours within the wage pool. This shift was a direct result of new cost centres established for Combined Sewer Overflows (CSOs) which were previously part of Wastewater Services, but are now part of Stormwater Services based on the methodology of the Cost of Service Rate Design Manual. Training and Development - Is budgeted to increase by 9% or $9k in 2013/14 over projected 2012/13 due to increased focus on safety awareness, wastewater certification training and supervisor training. Contract Services - Contract Services is a significant component of Wastewater Collection and is comprised of road and street repairs, contracts for stone and crusher run aggregates, grounds and landscaping work, and contracts for hired equipment. Contract Services is projected to increase by 10% or $220k in 2013/14 over projected 2012/13 due to reclassification of a general ledger account for HRM Fees and Services, from Professional Services to Contract Services, to better reflect the nature of the services provided. There is a corresponding decrease in Professional Services. The various fees charged by Halifax Regional Municipality would include pavement impact fees, inspection fees, capital chargebacks of hardware adjustments and compaction testing. Electricity Is budgeted to increase by 10% or $152k in 2013/14 over projected 2012/13 based on projected consumption and rate increases. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies & Services Are budgeted to increase by 16% or ($103k) in 2013/14 compared to projected 2012/13 due to inflationary increases including water & wastewater and heating fuel rate increases, and also due to an increase in work being undertaken inhouse. Some work previously outsourced to contractors relating to manhole repairs and lateral pipe repairs are being done in-house where feasible. For manhole repairs, materials and supplies would include frames and covers, and for lateral repairs purchases would include pipe, gravel, and asphalt, landscaping and concrete. Professional Services Is budgeted to decrease by 57% or ($276k) compared to projected 2012/13. This is primarily due to the reclassification of a general ledger account
January 9, 2013
Page 145
Wastewater Rate Study 2013/14 Appendix 2A Page 11 for HRM Fees and Services from Professional Services to Contract Services to better reflect the nature of the services provided. There is a corresponding increase in Contract Services. Fleet Services Is budgeted to increase in 2013/14 by 62% or $397k over projected 2012/13 due to operating costs for two new vehicles, and increasing fleet unit charge rates including fuel costs. Supplementary detail for fleet costs is shown in Appendix 7. The two new vehicles are a new CCTV van, and a new vacuum truck. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. The increase also includes a new heavy duty mechanic, a significant portion of whose hours would be charged to Fleet for Wastewater Collection.
January 9, 2013
Page 146

Worksheet WW-4
January 3, 2013


Wastewater Collections
Salaries and Benefits $3,982,680 $4,108,008 $4,149,651 $4,279,854 $125,328 3% $52,563 109% ($511,119) -18% $87,016 6% ($197,833) -23% $179,737 59% ($28,317) -4% $25,718 47% $19,810 13% ($61,622) 18% ($5,682) 14% ($314,402) -3% $41,643 1% $9,000 9% $220,389 10% $152,128 10% $103,010 16% ($276,500) -57% $396,844 62% $0 0% $78,991 45% ($44,336) 11% ($11,635) 25% $669,534 7% $130,203 3% ($4,500) -4% $36,102 1% $160,873 10% ($11,600) -2% $3,400 2% $3,001 0% $0 0% $9,014 4% ($8,934) 2% ($1,108) 2% $316,451 3%
$48,437
$101,000
$110,000
$105,500
Contract Services
$2,798,540
$2,287,421
$2,507,810
$2,543,912
Electricity
$1,374,597
$1,461,613
$1,613,741
$1,774,614
$842,023
$644,190
$747,200
$735,600
$302,763
$482,500
$206,000
$209,400
Fleet Services
$666,301
$637,984
$1,034,828
$1,037,829
Chemicals
$54,282
$80,000
$80,000
$80,000
$155,584
$175,394
$254,385
$263,399
Allocated to SW Services re: Combined Sewers
($349,492)
($411,114)
($455,450)
($464,384)
Allocated to SW Services re: Regional Administration
($40,846)
($46,528)
($58,163)
($59,271)
Total Wastewater Collections $9,834,870
$9,520,468
$10,190,002 $10,506,453
January 9, 2013
Page 147
Wastewater Rate Study 2013/14 Appendix 2A Page 13 Wastewater Treatment Salaries and Benefits - Are budgeted to increase by 10% or $431k in 2013/14 over projected 2012/13. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. The increase includes new staff including an Operations Engineer allocated 50% to Wastewater Treatment and budgeted for a full year, a new Process Technician at the Eastern Passage Wastewater Treatment Facility (WWTF) budgeted for a full year, and a new Labourer at the Eastern Passage WWTF budgeted for a half year. Training and Development - Is projected to increase by 16% or ($11k) in 2013/14 over projected 2012/13 due to additional costs for wastewater treatment staff to attend training. Contract Services - Contract Services are a significant component of Wastewater Treatment and include trucking and de-watering of bio-solids. Contract Services are projected to increase by 11% or ($486k) in 2013/14 compared to projected 2012/13 due to a $147 k increase in the Seaboard trucking contract and a $503k increase in the N-Viro Contract both of which are based on volumes and inflationary increases.. There are some small savings in other contracted services that offset some of this increase. Electricity - Is budgeted to increase by 21% or $523k in 2013/14 over projected 2012/13 due to projected consumption and rates. A $54k increase is projected for the Aerotech WWTF, and a $249k increase is projected for the new secondary treatment at Eastern Passage WWTF. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services - Materials, Supplies and Services are a significant component of Wastewater Treatment, and are comprised of items such as of tools and equipment, heating fuel, and water. Materials, Supplies and Services are projected to increase by 5% or $137k in 2013/14 over projected 2012/13 due to annual rate increases for such items as water and heating fuel, and increased water usage at the Eastern Passage WWTF as a result of the upgrades. Fleet Services Are projected to increase by 8% or $26K in 2013/14 over projected 2012/13 due to Operations Costs associated with forklifts which were not included in previous years, and due to increases in the unit rates to cover the fleet operating costs. Supplementary detail for fleet costs is shown in Appendix 7 Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases.
January 9, 2013
Page 148
Wastewater Rate Study 2013/14 Appendix 2A Page 14 Chemicals - Are budgeted to increase by 13% or $282k in 2013/14 over projected 2012/13, based on current tendered prices and projected usage based on estimates from chemical providers of 5% increases in chemical prices. Chemicals will be tendered in January for contracts beginning April 1st, so this is a budget risk for HRWC. A separate schedule for projected chemicals expenditures is shown in Appendix 7. Operating Cost Recoveries - Are comprised of (i) recoveries relating to trucking of sludge, (ii) recoveries relating to Regional Administration and (iii) recoveries from Developers. Contractors. Recoveries (i) and (ii) are standard entries as a part of HRWCs expense allocation process, charged to the De-watering Facility. Recoveries from Developers/ Contractors are operating expenses paid by HRWC relating to the new Eastern Passage Treatment Facility being constructed, which are recoverable from the contractor as part of the contract.
January 9, 2013
Page 149

Worksheet WW-4
January 3, 2013


Wastewater Treatment
Salaries and Benefits $4,142,905 $4,358,630 $4,790,058 $4,985,354 $215,725 5% $31,496 80% ($342,340) -7% ($801) 0% ($28,539) -1% ($173,505) -83% ($18,063) -5% $233,845 13% ($69,257) -24% ($5,289) 18% ($4,704) 26% $0 0% ($161,432) -1% $431,428 10% $11,200 16% $485,972 11% $522,832 21% $137,030 5% $150 0% $25,642 8% $281,549 13% $4,416 2% $3,360 -10% ($5,145) 23% ($185,244) 0% $1,713,190 10% $195,296 4% ($5,400) -7% $122,394 3% $299,916 10% ($154,548) -6% ($250) -1% $912 0% $95,893 4% $6,921 3% ($464) 2% ($613) 2% ($25,471) 14% $534,586 3%
$39,504
$71,000
$82,200
$76,800
Contract Services
$4,608,167
$4,265,827
$4,751,799
$4,874,193
Electricity
$2,494,638
$2,493,837
$3,016,669
$3,316,585
$2,536,154
$2,507,615
$2,644,645
$2,490,097
$209,805
$36,300
$36,450
$36,200
Fleet Services
$352,273
$334,210
$359,852
$360,764
Chemicals
$1,855,917
$2,089,762
$2,371,311
$2,467,204
$290,118
$220,861
$225,277
$232,198
Operating Cost Recoveries re: trucking of sludge
($28,820)
($34,109)
($30,749)
($31,213)
Operating Cost Recoveries re: Regional Administration
($17,914)
($22,618)
($27,763)
($28,376)
Operating Cost Recoveries re: Developers/ Contractors
$0
$0
($185,244)
($210,715)
Total Wastewater Treatment $16,482,747 $16,321,315 $18,034,505 $18,569,091
January 9, 2013
Page 150
Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Explanations for detailed variances within Technical Services are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on data points. For additional information regarding the allocation of Technical Services (SCADA) across the Utility, refer to page 21 of the Cost of Service Rate Design Manual.
It should be noted the 33% or $275k increase in the Technical Services costs for Wastewater Services is due mainly to the different methodology used under the Cost of Service Rate Design Manual, whereby data points are used to allocated costs. Under the previous allocation method, the basis for the allocation was based on judgment as opposed to a quantifiable method.
Worksheet WW-4
January 3, 2013


$785,576
$821,208
$1,096,207
$1,149,812
$35,632 5%
$274,999 33%
$53,605 5%
January 9, 2013
Page 151
Wastewater Rate Study 2013/14 Appendix 2A Page 17 Engineering and IS Explanations for detailed variances within Engineering and IS are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Engineering and IS across the Utility, refer to pages 21-22 of the Cost of Service Rate Design Manual.
Amounts apportioned to Wastewater Services in 2013/14 show an increase of $322k or 12% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study.
Worksheet WW-4
December 21, 2012

2011/12 Actual 2012/13 Projections $2,794,937 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $3,116,507 $3,324,658 ( year over year - $ and % ) 2012/13 Projections $392,678 16% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $321,570 12% $208,151 7%
Engineering and Information Services
$2,402,259
January 9, 2013
Page 152
Environmental Services Explanations for detailed variances within Environmental Services are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on a determination of the Director of Environmental Services, based on budgeted costs and staff time employed. For additional information regarding the allocation of Environmental Services across the Utility, refer to pages 22-23 of the Cost of Service Rate Design Manual.
Amounts apportioned to Wastewater Services in 2013/14 show an increase of $115k or 9% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study.
Worksheet WW-4
December 21, 2012

$1,153,180
January 9, 2013
Page 153
Wastewater Rate Study 2013/14 Appendix 2A Page 19 Customer Service Explanations for detailed variances within Customer Service are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Customer Service across the Utility, refer to page 23 of the Cost of Service Rate Design Manual. From an accounting perspective, common cost allocations relating to Customer Service are as referenced in the manual above, with one exception as they relate to the cost of service. Included in Water and Wastewater Services are two (2) specific system functions that are not applicable in Stormwater, namely Meters and Meter Reading/Billing. For 2013/14, under the traditional accounting allocation method Stormwater Services would have been charged $307,034 (see Water Rate Study, Worksheet W-4). A deduction of $154,466 has been applied, reducing the cost allocated to Stormwater to $152,568. Allocated Customer Service costs in Wastewater have been increased by $154,466 accordingly. For 2013/14 under the traditional accounting allocation method Wastewater would have been charged $1,500,520 (see Water Rate Study, Worksheet W-4), however allocated amounts have now been increased to $1,654,986. It is for this reason Customer Service under Wastewater is showing such a dramatic increase in 2013/14 compared to 2012/13 of $236k or 17%, as indicated in the table below. This clearly shows the changing methodology employed using the Cost of Service Rate Design Manual.
Worksheet WW-4
December 21, 2012

Customer Service
$1,357,222
January 9, 2013
Page 154
Wastewater Rate Study 2013/14 Appendix 2A Page 20 Administration and Pension Explanations for detailed variances within Customer Service are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Administration and Pension across the Utility, refer to page 24 of the Cost of Service Rate Design Manual.
Amounts apportioned to Wastewater Services in 2013/14 show an increase of $201k or 6% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study:
Worksheet WW-4
January 3, 2013


$2,902,046
$3,589,022
$3,790,009
$3,806,562
$686,976 24%
$200,987 6%
$16,553 0%
January 9, 2013
Page 155
Worksheet WW-5 Cost of Service (COS) Structure

Worksheet WW-5 details the customer classifications, cost functions with allocated percentages, service characteristics and operating and capital cost classifications for wastewater services as detailed in the Cost of Service Rate Design Manual.
January 9, 2013
Page 156

Worksheet WW-5
December 21, 2012
Halifax Regional Water Commission Wastewater Rate Study Customer Classifications, Cost Functions & Service Characteristics
Customer Classifications
SF Residential Unmetered Multi-family Commercial - General Industrial Institutional
System Functions
Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General
Classification - Service Characteristics

Dry Weather Flow Wet Weather Flow BOD TSS Equivalent Meters Customer Service Indirect
Operating Classifications
Function Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Capital Classifications
Function Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Customer Service Meters Engineering and IS Environmental Services Administration and General
38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
January 9, 2013
Page 157
Worksheet WW-6 Operating Expense Functionalization

Worksheet WW-6 details the wastewater service operating expense categories cost elements, by the system functions detailed in the cost of service manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet WW-10 to allocate the costs to the service characteristics.
January 9, 2013
Page 158

Statement of Operating Expenditures 2013/14
Test Year #1

Wastewater System Operating Expense Cost Allocation Percent of Costs to Functions 2013/14
Advanced Primary Secondary Tertiary Treatment Treatment Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Worksheet WW-6
OPERATING EXPENSES
2013/14 Budget Pump Stations 48% 48% 9% 99% 61% 45% 45% 100% 48% 20% 48%
Wastewater Collection
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Sub-total Allocated to SW Services re: Combined Sewers Allocated to SW Services re: Regional Administration $4,149,651 $110,000 $2,507,810 $1,613,741 $747,200 $206,000 $1,034,828 $80,000 $254,385 $10,703,615 ($455,450) ($58,163) $10,190,002
Mains 41% 37% 51% 0% 32% 39% 45% 0% 37% 73% 37%
Service Laterals 11% 16% 40% 0% 7% 15% 10% 0% 16% 7% 16%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Total Wastewater Collection
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Sub-total Operating Cost Recoveries re: trucking of sludge Operating Cost Recoveries re: Regional Administration Operating Cost Recoveries re: Developers/ Contractors $4,790,058 $82,200 $4,751,799 $3,016,669 $2,644,645 $36,450 $359,852 $2,371,311 $225,277 $18,278,261 ($30,749) ($27,763) ($185,244) $18,034,505
Advanced Primary Secondary Tertiary Treatment Treatment Treatment 59% 30% 11% 65% 21% 14% 76% 21% 3% 66% 25% 8% 60% 30% 10% 71% 26% 3% 28% 38% 34% 84% 9% 7% 68% 24% 8% 0% 76% 0% 57% 25% 100% 43% 0% 0%
Mains 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Pump Stations 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Service Laterals 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Total Wastewater Treatment
January 9, 2013
Page 159

Test Year #1

Wastewater System Operating Expense Cost Allocation Percent of Costs to Functions 2013/14
Advanced Primary Treatment Meter Reading and Engineering Environmental Administration Billing and IS Services and General Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 30% 0% 0% 0% 0% 0% 0% 100%
Worksheet WW-6
OPERATING EXPENSES
2013/14 Budget Secondary Treatment Tertiary Treatment Pump Stations
Mains
Service Laterals
Technical Services
Customer Service
Meters
Other Operating Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Total Other Operating
$1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $10,997,640
Advanced Primary Secondary Tertiary Treatment Treatment Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Mains 0% 0% 0% 0% 0%
Pump Stations 0% 0% 0% 0% 0%
Service Laterals 0% 0% 0% 0% 0%
Technical Services 100% 0% 0% 0% 0%
Customer Service 0% 0% 0% 45% 0%
Meters 0% 0% 0% 24% 0%
Total O&M Expense
$39,222,147
January 9, 2013
Page 160

Test Year #1

Advanced Primary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Meter Reading and Engineering Environment Administration Billing and IS al Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
OPERATING EXPENSES
2013/14 Budget Secondary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Tertiary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Pump Stations $1,997,363 $52,301 $225,223 $1,603,740 $453,349 $93,666 $462,580 $80,000 $120,951 ($91,717) ($27,686) $4,969,770
Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Sub-total Allocated to SW Services re: Combined Sewers Allocated to SW Services re: Regional Administration
Total
$4,149,651 $110,000 $2,507,810 $1,613,741 $747,200 $206,000 $1,034,828 $80,000 $254,385 $10,703,615 ($455,450) ($58,163) $10,190,002
Mains $1,713,919 $40,286 $1,275,592 $6,983 $238,440 $81,149 $470,523 $0 $93,165 ($333,196) ($21,288) $3,565,574
Service Laterals $438,369 $17,413 $1,006,994 $3,018 $55,412 $31,185 $101,724 $0 $40,269 ($30,537) ($9,190) $1,654,658
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,149,651 $110,000 $2,507,810 $1,613,741 $747,200 $206,000 $1,034,828 $80,000 $254,385 ($455,450) ($58,163) $10,190,002
Advanced Primary Treatment $2,807,366 $53,100 $3,623,742 $2,001,328 $1,589,799 $26,053 $101,071 $1,984,783 $152,340 $0 ($20,961) $0 $12,318,620
Secondary Treatment $1,456,686 $17,274 $993,143 $766,355 $788,995 $9,426 $136,478 $224,072 $54,685 ($17,619) ($6,802) ($185,244) $4,237,448
Tertiary Treatment $526,006 $11,826 $134,914 $248,986 $265,851 $972 $122,303 $162,456 $18,253 ($13,130) $0 $0 $1,478,436
Mains $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Pump Stations $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Service Laterals $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Reading and Engineering Environment Administration Billing and IS al Services and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,790,058 $82,200 $4,751,799 $3,016,669 $2,644,645 $36,450 $359,852 $2,371,311 $225,277 ($30,749) ($27,763) ($185,244) $18,034,505
January 9, 2013
Page 161

Test Year #1

Advanced Primary Treatment Meter Reading and Engineering Environment Administration Billing and IS al Services and General
OPERATING EXPENSES
2013/14 Budget Secondary Treatment Tertiary Treatment Pump Stations
Mains
Service Laterals
Technical Services
Customer Service
Meters
Total
$1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $10,997,640
Advanced Primary Secondary Tertiary Treatment Treatment Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Mains $0 $0 $0 $0 $0 $0
Pump Stations $0 $0 $0 $0 $0 $0
Service Laterals $0 $0 $0 $0 $0 $0
Technical Services $1,096,207 $0 $0 $0 $0 $1,096,207
Customer Service $0 $0 $0 $745,621 $0 $745,621
Meters $0 $0 $0 $404,858 $0 $404,858
Meter Reading and Engineering Environment Administration Billing and IS al Services and General $0 $0 $0 $0 $0 $3,116,507 $0 $0 $0 $0 $1,339,931 $0 $504,507 $0 $0 $0 $0 $0 $0 $3,790,009 $504,507 $3,116,507 $1,339,931 $3,790,009
Total $1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $10,997,640
Total O&M Expense
$39,222,147
$12,318,620
$4,237,448
$1,478,436
$3,565,574
$4,969,770
$1,654,658
$1,096,207
$745,621
$404,858
$504,507
$3,116,507
$1,339,931
$3,790,009
$39,222,147
January 9, 2013
Page 162
Worksheet WW-7 Continuity Schedule Utility Plant in Service

Worksheet WW-7 provides additional detail on Funding Utility Plant in Service, Contributed Assets, Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation on transportation equipment.
January 9, 2013
Page 163
Worksheet WW-7
Wastewater Rate Study Continuity Schedule/ Depreciation for Utility Plant in Service 2013/14
Work in Process approved in Utility Plant Projected Previous in Service Projected Utility Plant in Years Additions in Contributed in Retirements Service 2013-14 2013-14 2013-14 2013-14 Mar-14
Contributed Portion Mar-13 3,012,600 1,108,071 1,351,711 90,726 915,577 1,548,379 54,134,501 39,396,235 42,105,689 178,755 5,815,434 2,851,723 2,254,924 8,501,443 142,744,800 4,144,560 11,866,837 5,915,828
Accumulated Depreciation on funded assets Mar-13 479,320 133,299 2,254,154 1,375,096 174,696 11,391,405 2,725 170,323 100,092 3,871 34,408 23,000 1,684,843 126,951 332,211 352,662
Accumulated Depreciation on donated assets Mar-13 948,856 85,850 35,585,684 2,330,849 5,649,787 17,303 4,281,695 335,937 68,472 221,815 42,597,079 328,082 246,310 215,542
Projected Retirement of Accumulated Depreciation 2013-14
Projected Net Book Value Calculated Depreciation before direct deprec expense on Regulatory Depreciation on existing funded assets asset expense Mar-14 2013/14 2013/14 98,813 2013/14 858 9,037 11,668 161,312 4,915 1,036 1,104
Intangible Plant Tangible Plant Land WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land Structures - WW WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings Treatment & Pump Equipment WW WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Airport-Aerotech WW Manholes Mains WW WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WW Outfalls
988,129 2,516,631 2,703,421 57,902 255,339 586,128 2,072,736 68,938,496 15,431,433 6,147,059 117,348,571 36,337 823,011 1,168,208 140,174 3,577,320 3,472,000 50,359,190 2,127,912 10,946,635 9,489,343
4,000,730
4,000,730
1,428,176
-
2,572,554
98,813
3,624,702 4,055,132 148,629 255,339 1,501,705 3,621,115 123,072,997 54,827,669 6,147,059 159,454,260 215,092 6,638,445 4,019,931 2,395,097 12,078,764 3,472,000 193,103,989 6,272,471 22,813,472 15,405,171
200,000 2,094,000 200,000 1,843,000 5,495,000 2,500,000 400,000 2,165,000 500,000 8,016,000 15,111,000 15,000,000 3,074,000 3,850,000 20,000,000 9,311,000 3,724,000
3,624,702 4,055,132 148,629 255,339 1,501,705 3,621,115 158,072,997 67,212,669 13,721,059 182,581,260 215,092 6,638,445 4,019,931 2,895,097 14,443,764 5,315,000 203,192,989 6,672,471 22,813,472 15,605,171
219,149 37,839,838 3,705,945 174,696 17,041,192 20,028 4,452,018 436,029 72,343 256,223 23,000 44,281,923 455,033 578,521 568,204
3,624,702 4,055,132 148,629 255,339 1,501,705 3,401,966 120,233,159 63,506,724 13,546,363 165,540,068 195,063 2,186,426 3,583,901 2,822,754 14,187,541 5,292,000 158,911,067 6,217,438 22,234,951 15,036,967 90,105 37,558 330 6,145 3,865 51,612 1,817 46,890 26,321 2,803 4,186 62,750 11,032 23,535
51,818 1,681,830 626,699 293,535 5,145,079 1,817 46,890 62,321 2,803 50,865 58,000 727,894 42,558 127,772 127,324
January 9, 2013
Page 164
Worksheet WW-7
Wastewater Rate Study Continuity Schedule/ Depreciation for Utility Plant in Service 2013/14
Accumulated Depreciation on funded assets Mar-13
Accumulated Depreciation on donated assets Mar-13
Projected Net Book Value Calculated Depreciation before direct deprec expense on Regulatory Depreciation on existing funded assets asset expense Mar-14 2013/14 2013/14 2013/14 -
Equipment WW WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment Small Systems - WW WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems URBAN CORE SUB-TOTAL
1,933,721 1,460,680 394,109 2,367,684 180,631 12,461 689,905 1,850,192
5,354,427 473,743 48,428 517,610 250,000 3,293,239 826,600
7,288,148 1,934,423 394,109 2,367,684 229,059 530,071 250,000 3,983,144 2,676,792 646,777,197
32,034,000 58,677,000 5,565,000 994,000 150,000 200,000 1,449,000
8,282,148 2,084,423 594,109 3,816,684 229,059 530,071 250,000 3,983,144 2,676,792 743,053,197
5,851,159 458,128 63,535 709,884 15,414 17,902 336,260 766,347
496,723 258,607 63,535 709,884 9,360 14,437 136,218 37,813
5,354,435 199,520 6,053 3,465 200,042 728,535
2,430,989 1,626,295 530,574 3,106,800 213,645 512,169 250,000 3,646,884 1,910,444

-
184,636 77,679 15,822 150,633 1,532 1,114 42,646 9,966 951,790
483,636 145,679 97,822 697,633 9,532 11,114 52,646 49,966
308,075,358
338,701,839
119,770,947
20,365,633
99,405,314
623,282,250
10,694,045
189,929
January 9, 2013
Page 165
Worksheet WW-8 Depreciation Functionalization

Worksheet WW-8 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Rate Design Manual both in a percentage and dollar format. These are then used in Worksheet WW-10 to allocate depreciation to the service characteristics.
January 9, 2013
Page 166


Annual Depreciation INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WW Outfalls EQUIPMENT WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems Total
Advanced Primary Secondary Tertiary Treatment Treatment Treatment INTANGIBLE PLANT 0% 0%
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
$98,813
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
LAND $0 $0 $0 $0 $0 $52,677 $1,690,866 $638,367 $293,535 $5,306,391 $1,817 $46,890 $62,321 $2,803 $50,865 $58,000 $732,808 $42,558 $128,808 $128,427 $145,679 $97,822 $697,633 $9,532 $11,114 $0 $52,646 $49,966 $10,400,339 90% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% STRUCTURES 80% 0% 0% 70% 20% 10% 0% 0% 0% 0% 0% 0% TREATMENT & PUMP EQUIPMENT 70% 30% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 80% 20% 0% EQUIPMENT 0% 0% 0% 40% 40% 20% 0% 0% 0% SMALL SYSTEMS 0% 0% 80% 0% 80% 0% 0% 80% 0% 0% 0% 80% 0% 0% 80% 10% 0% 0% 0% 100% 20% 0% 0% 0% 0% 0% 0% 0% 100% 100% 50% 100% 0% 100% 0% 50% 0% 0% 10% 10% 10% 10% 10% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 100% 100% 0% 0% 0% 50% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 25% 0% 0% 10% 10% 10% 10% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0%
January 9, 2013
Page 167


Advanced Primary Treatment
Secondary Treatment
Tertiary Treatment
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
Meter Environme Reading Engineering ntal Administration and Billing and IS Services and General
Total
$98,813
INTANGIBLE PLANT $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$98,813
$98,813
LAND $0 $0 $0 $0 $0 $52,677 $1,690,866 $638,367 $293,535 $5,306,391 $1,817 $46,890 $62,321 $2,803 $50,865 $58,000 $732,808 $42,558 $128,808 $128,427 $145,679 $97,822 $697,633 $9,532 $11,114 $0 $52,646 $49,966 $10,400,339 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 STRUCTURES $42,141 $0 $0 $1,183,607 $338,173 $169,087 $0 $0 $0 $0 $0 $0 TREATMENT & PUMP EQUIPMENT $3,714,474 $1,591,917 $0 $0 $0 $0 $0 $0 $0 $0 $0 $62,321 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $102,742 $25,685 $0 EQUIPMENT $0 $0 $0 $39,129 $39,129 $19,564 $0 $0 $0 SMALL SYSTEMS $0 $0 $7,625 $0 $8,892 $0 $0 $0 $0 $0 $0 $42,117 $0 $0 $39,973 $5,082,093 $2,003,796 $340,687 48.86% 19.27% 3.28% $0 $0 $0 $0 $0 $10,535 $0 $0 $0 $0 $0 $0 $0 $2,803 $50,865 $29,000 $732,808 $0 $128,808 $0 $72,839 $0 $0 $953 $1,111 $0 $5,265 $4,997 $1,039,984 10.00% $0 $0 $0 $0 $0 $0 $0 $638,367 $0 $0 $1,817 $46,890 $0 $0 $0 $29,000 $0 $0 $0 $0 $36,420 $0 $0 $0 $0 $0 $0 $0 $752,494 7.24% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $42,558 $0 $0 $36,420 $0 $0 $953 $1,111 $0 $5,265 $4,997 $91,304 0.88% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,408 $0 $0 $0 $0 $0 $174,408 1.68% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,408 $0 $0 $0 $0 $0 $174,408 1.68% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,408 $0 $0 $0 $0 $0 $174,408 1.68% $0 $0 $0 $0 $0 $0 $0 $0 $293,535 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,408 $0 $0 $0 $0 $0 $566,756 5.45% $0 $0 $0 $0 $0 $52,676 $1,690,867 $638,367 $293,535 $5,306,391 $1,817 $46,890 $62,321 $2,803 $50,865 $58,000 $732,808 $42,558 $128,808 $128,427 $145,679 $97,822 $697,632 $9,531 $11,114 $0 $52,647 $49,967 $10,400,338
January 9, 2013
Page 168 100.02%
Worksheet WW-9 Allocation of Utility Plant in Service

Worksheet WW-9 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Rate Design Manual both in a percentage and dollar format. These are then used in Worksheet WW-10 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 169

Allocation of Utility Plant in Service 2013/14

Projected Projected Utility Accumulated Plant in Service, Depreciation, end of year end of year
INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems Total
Projected Net Book Value, end of year
Contributed Plant, excluded from Rate Base
Rate Base (Col D - Col E)
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
$4,000,730
$1,526,989
$2,473,741
$2,063,745
$409,996
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
LAND $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,621,115 $158,072,997 $67,212,669 $13,721,059 $182,581,260 $215,092 $6,638,445 $4,019,931 $2,895,097 $14,443,764 $5,315,000 $203,192,989 $6,672,471 $22,813,472 $15,605,171 $8,282,148 $2,084,423 $594,109 $3,816,684 $0 $0 $0 $0 $0 $270,967 $39,521,668 $4,332,644 $468,231 $22,186,270 $21,845 $4,498,909 $498,350 $75,147 $307,088 $81,000 $45,009,816 $497,591 $706,293 $695,528 $6,334,794 $603,806 $161,357 $1,407,518 $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,350,148 $118,551,329 $62,880,025 $13,252,829 $160,394,990 $193,247 $2,139,536 $3,521,580 $2,819,951 $14,136,676 $5,234,000 $158,183,173 $6,174,880 $22,107,179 $14,909,643 $1,947,353 $1,480,617 $432,752 $2,409,166 $1,108,071 $1,351,711 $90,726 $0 $915,577 $1,462,529 $18,548,817 $37,065,386 $0 $36,455,902 $161,452 $1,533,739 $2,515,785 $2,686,452 $10,444,628 $0 $102,647,720 $4,216,477 $11,620,527 $5,700,285 -$8 $274,223 $0 $0 $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,887,619 $100,002,512 $25,814,638 $13,252,829 $123,939,088 $31,795 $605,797 $1,005,795 $133,499 $3,692,048 $5,234,000 $55,535,453 $1,958,403 $10,486,652 $9,209,358 $1,947,362 $1,206,393 $432,752 $2,409,166 90% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% STRUCTURES 80% 0% 0% 70% 20% 10% 0% 0% 0% 0% 0% 0% TREATMENT & PUMP EQUIPMENT 70% 30% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 80% 20% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 40% 40% 20% 0% 0% 0% SMALL SYSTEMS 0% 0% 80% 0% 80% 0% 0% 80% 0% 0% 0% 80% 0% 0% 80% 10% 0% 0% 0% 100% 20% 0% 0% 0% 0% 0% 0% 0% 100% 100% 50% 100% 0% 100% 0% 0% 50% 0% 0% 10% 10% 10% 10% 10% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 100% 100% 0% 0% 0% 50% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 25% 0% 0% 10% 10% 10% 10% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 25% 0% 0% 0% 0% 0%
$229,059 $24,945 $530,071 $29,016 $250,000 $0 $3,983,144 $388,906 $2,676,792 $816,313 $743,053,197 $130,464,992
$204,113 $42,374 $161,739 $501,055 $514,145 -$13,090 $250,000 $250,000 $0 $3,594,238 $3,093,197 $501,041 $1,860,479 $98,065 $1,762,413 $612,588,205 $244,861,525 $367,726,680
January 9, 2013
Page 170


INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems Total
Secondary Treatment
Tertiary Treatment
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
Meter Reading and Billing
Engineering Environmental Administration and IS Services and General
Total
$4,000,730
$1,526,989
$2,473,741
$2,063,745
$409,996
INTANGIBLE PLANT $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$409,996
$409,996
LAND $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,621,115 $158,072,997 $67,212,669 $13,721,059 $182,581,260 $215,092 $6,638,445 $4,019,931 $2,895,097 $14,443,764 $5,315,000 $203,192,989 $6,672,471 $22,813,472 $15,605,171 $8,282,148 $2,084,423 $594,109 $3,816,684 $0 $0 $0 $0 $0 $270,967 $39,521,668 $4,332,644 $468,231 $22,186,270 $21,845 $4,498,909 $498,350 $75,147 $307,088 $81,000 $45,009,816 $497,591 $706,293 $695,528 $6,334,794 $603,806 $161,357 $1,407,518 $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,350,148 $118,551,329 $62,880,025 $13,252,829 $160,394,990 $193,247 $2,139,536 $3,521,580 $2,819,951 $14,136,676 $5,234,000 $158,183,173 $6,174,880 $22,107,179 $14,909,643 $1,947,353 $1,480,617 $432,752 $2,409,166 $1,108,071 $1,351,711 $90,726 $0 $915,577 $1,462,529 $18,548,817 $37,065,386 $0 $36,455,902 $161,452 $1,533,739 $2,515,785 $2,686,452 $10,444,628 $0 $102,647,720 $4,216,477 $11,620,527 $5,700,285 -$8 $274,223 $0 $0 $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,887,619 $100,002,512 $25,814,638 $13,252,829 $123,939,088 $31,795 $605,797 $1,005,795 $133,499 $3,692,048 $5,234,000 $55,535,453 $1,958,403 $10,486,652 $9,209,358 $1,947,362 $1,206,393 $432,752 $2,409,166 $2,264,968 $0 $0 $251,663 $2,703,421 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $586,128 STRUCTURES $1,510,095 $0 $0 $377,524 $70,001,758 $20,000,502 $10,000,251 $0 $0 $0 $0 $0 $0 $0 $0 $0 TREATMENT & PUMP EQUIPMENT $86,757,361 $37,181,726 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,005,795 $0 $0 $0 $0 $133,499 MAINS $0 $0 $0 $3,692,048 $0 $0 $0 $2,617,000 $0 $0 $0 $55,535,453 $0 $0 $0 $0 $0 $0 $0 $10,486,652 $7,367,486 $1,841,872 $0 $0 EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $603,197 $173,101 $173,101 $86,550 $0 $0 $0 $0 $0 SMALL SYSTEMS $0 $0 $129,391 $16,174 $0 -$10,472 $0 -$1,309 $0 $0 $0 $0 $0 $0 $400,833 $50,104 $0 $0 $1,409,931 $176,241 $170,778,190 $59,186,729 $13,032,751 $74,524,374 46.44% 16.10% 3.54% 20.27% $0 $0 $57,902 $0 $0 $0 $0 $25,814,638 $0 $0 $31,795 $605,797 $0 $0 $0 $2,617,000 $0 $0 $0 $0 $0 $301,598 $0 $0 $0 $0 $0 $0 $0 $29,428,730 8.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,958,403 $0 $0 $0 $301,598 $0 $0 $16,174 -$1,309 $0 $50,104 $176,241 $2,501,211 0.68% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $602,292 $0 $0 $0 $0 $0 $602,292 0.16% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $602,292 $0 $0 $0 $0 $0 $602,292 0.16% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $602,292 $0 $0 $0 $0 $0 $602,292 0.16% $0 $0 $0 $255,339 $0 $0 $0 $0 $13,252,829 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,947,362 $0 $0 $602,292 $0 $0 $0 $0 $0 $16,467,818 4.48% $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,887,619 $100,002,511 $25,814,638 $13,252,829 $123,939,087 $31,795 $605,797 $1,005,795 $133,499 $3,692,048 $5,234,000 $55,535,453 $1,958,403 $10,486,652 $9,209,358 $1,947,362 $1,206,393 $432,752 $2,409,168 $161,739 -$13,090 $0 $501,041 $1,762,413 $367,726,679 100.00%
$229,059 $24,945 $530,071 $29,016 $250,000 $0 $3,983,144 $388,906 $2,676,792 $816,313 $743,053,197 $130,464,992
$204,113 $42,374 $161,739 $501,055 $514,145 -$13,090 $250,000 $250,000 $0 $3,594,238 $3,093,197 $501,041 $1,860,479 $98,065 $1,762,413 $612,588,205 $244,861,525 $367,726,680
January 9, 2013
Page 171
Worksheet WW-10 Cost Classification

Worksheet WW-10 details the costs as allocated to the system functions in Worksheet WW-6, WW-8 and WW-9 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Rate Design Manual. The amounts are then totaled by operation and maintenance, depreciation and are used in Worksheet WW-11 to calculate the wastewater unit rate and bill calculation. The Plant in Service functions are also totaled and the percentage by service function is used to allocate the net debt servicing costs also in Worksheet WW-11.
January 9, 2013
Page 172

Wastewater Cost Classification & Unit Rate Calculations 2013/14
Dry Weather Flow Wet Weather Flow BOD

Wastewater Collection Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total Wastewater Treatment Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total Other Operating Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total O&M Total $0 $0 $0 $3,565,574 $4,969,770 $1,654,658 $0 $0 $0 $0 $0 $0 $0 $10,190,002 37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Equivalent Meters Classification Percentages TSS 22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
Customer Service
Indirect
Dry Weather Flow
Wet Weather Flow
BOD
TSS
Equivalent Meters
Customer Service
Indirect
Total
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $3,387,295 $4,472,793 $0 $0 $0 $0 $0 $0 $0 $0
$7,860,088
$0 $0 $0 $178,279 $496,977 $0 $0 $0 $0 $0 $0 $0 $0
$675,256
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $1,654,658 $0 $0 $0 $0 $0 $0 $0
$1,654,658
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $3,565,574 $4,969,770 $1,654,658 $0 $0 $0 $0 $0 $0 $0 $10,190,002
$12,318,620 $4,237,448 $1,478,436 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,034,505
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$4,557,890 $2,330,597 $768,787 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$7,657,274
$2,340,538 $762,741 $266,119 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,369,398
$2,710,097 $466,119 $177,412 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,353,628
$2,710,097 $677,992 $266,119 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,654,208
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$12,318,622 $4,237,449 $1,478,437 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,034,508
$0 $0 $0 $0 $0 $0 $1,096,207 $745,621 $404,858 $504,507 $3,116,507 $1,339,931 $3,790,009 $10,997,640 $39,222,147
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $0 $0 $0 $844,079 $0 $0 $0 $0 $0 $0
$844,079
$0 $0 $0 $0 $0 $0 $252,128 $0 $0 $0 $0 $0 $0
$252,128
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $404,858 $0 $0 $0 $0
$404,858
$0 $0 $0 $0 $0 $0 $0 $745,621 $0 $504,507 $0 $0 $0
$1,250,128
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $3,116,507 $1,339,931 $3,790,009

$8,246,447
$0 $0 $0 $0 $0 $0 $1,096,207 $745,621 $404,858 $504,507 $3,116,507 $1,339,931 $3,790,009 $10,997,640
$39,222,150
January 9, 2013
Page 173

Dry Weather Flow Wet Weather Flow BOD Equivalent Meters Classification Percentages TSS Customer Service Indirect Dry Weather Flow Wet Weather Flow BOD TSS Equivalent Meters Customer Service Indirect Total
Depreciation Expense by Function All Assets including Harbour

Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $5,082,093 $2,003,796 $340,687 $1,039,984 $752,494 $91,304 $0 $174,408 $0 $0 $174,408 $174,408 $566,756 $10,400,338 38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $1,931,195 $581,101 $85,172 $779,988 $564,371 $0 $0 $0 $0 $0 $0 $0 $0
$3,941,827
$609,851 $420,797 $51,103 $259,996 $188,124 $0 $0 $0 $0 $0 $0 $0 $0

$1,529,871
$1,270,523 $500,949 $102,206 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,873,678
$1,270,523 $500,949 $102,206 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,873,678
$0 $0 $0 $0 $0 $91,304 $0 $0 $0 $0 $0 $0 $0
$91,304
$0 $0 $0 $0 $0 $0 $0 $174,408 $0 $0 $0 $0 $0
$174,408
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $174,408 $174,408 $566,756

$915,572
$5,082,092 $2,003,796 $340,687 $1,039,984 $752,495 $91,304 $0 $174,408 $0 $0 $174,408 $174,408 $566,756 $10,400,338
Rate Base by Function All Assets including Harbour

Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $170,778,190 $59,186,729 $13,032,751 $74,524,374 $29,428,730 $2,501,211 $0 $602,292 $0 $0 $602,292 $602,292 $16,467,818 $367,726,679 38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $64,895,712 $17,164,151 $3,258,188 $55,893,281 $22,071,548 $0 $0 $0 $0 $0 $0 $0 $0
$163,282,880 44.40%
$20,493,383 $12,429,213 $1,954,913 $18,631,094 $7,357,183 $0 $0 $0 $0 $0 $0 $0 $0

$60,865,786 16.55%
$42,694,548 $14,796,682 $3,909,825 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$61,401,055 16.70%
$42,694,548 $14,796,682 $3,909,825 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$61,401,055 16.70%
$0 $0 $0 $0 $0 $2,501,211 $0 $0 $0 $0 $0 $0 $0
$2,501,211 0.68%
$0 $0 $0 $0 $0 $0 $0 $602,292 $0 $0 $0 $0 $0
$602,292 0.16%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $602,292 $602,292 $16,467,818

$17,672,402 4.81%
$170,778,191 $59,186,728 $13,032,751 $74,524,375 $29,428,731 $2,501,211 $0 $602,292 $0 $0 $602,292 $602,292 $16,467,818 $367,726,681 100.00%
January 9, 2013
Page 174
Worksheet WW-11 Unit Costs and Returns
Worksheet WW-11 uses the costs from Worksheet WW-10 allocated to the system functions to calculate the unit wastewater rates for 2013/14 and 2014/15 using the billing determinates. The percentage of Dry Weather Flow, Wet Weather Flow, BOD, TSS, Equivalent Meters and Customer Service is used to allocate the indirect costs for O&M Expenses, Depreciation Expense and Debt service. Worksheet WW-11 also calculates the return on Rate Base.
January 9, 2013
Page 175

Wastewater Unit Rate and Bill Calculations 2013/14

Dry Weather FlowWet Weather Flow Revenue Requirements O&M Expenses Wastewater Collection Wastewater Treatment Other Operating Sub-Total Direct Allocation Percentages O&M Expenses By Service Characteristic Depreciation Expenses All Assets including Harbour Direct Allocation Percentages Depreciation Expenses By Service Characteristic BOD TSS Equivalent Meters Customer Service Indirect Total
$7,860,088 $7,657,274 $844,079 $16,361,441 52.82% $20,717,234
$675,256 $3,369,398 $252,128 $4,296,782 13.87% $5,440,685
$0 $3,353,628 $0 $3,353,628 10.83% $4,246,441
$0 $3,654,208 $0 $3,654,208 11.80% $4,627,043
$1,654,658 $0 $404,858 $2,059,516 6.65% $2,607,807
$0 $0 $1,250,128 $1,250,128 4.04% $1,582,941
$0 $0 $8,246,447 $8,246,447
$10,190,002 $18,034,508 $10,997,640 $39,222,150 100.00% $39,222,151
$3,941,827 41.56%
$1,529,871 16.13%
$1,873,678 19.75%
$1,873,678 19.75%
$91,304 0.96%
$174,408 1.84%
$915,572
$10,400,338 100.00%
$4,322,335
$1,677,551
$2,054,546
$2,054,546
$100,118
$191,244
$0
$10,400,340
Return Components Plant in Service by Serv Char Percents Debt Service ( Principal, Interest, Fees) $17,643,937 Direct Allocation Percentages Debt Service ( Principal, Interest, Fees) By Service Characteristic (Net) 44.40% $7,834,495 46.65% $8,230,896 16.55% $2,920,408 17.39% $3,068,281 16.70% $2,946,091 17.54% $3,094,746 16.70% $2,946,091 17.54% $3,094,746 0.68% $120,011 0.71% $125,272 0.16% $28,899 0.17% $29,995 4.81% $847,942 100.00% $17,643,937 100.00% $17,643,937
$33,270,465 49.47%
$10,186,517 15.14%
$9,395,733 13.97%
$9,776,335 14.53%
$2,833,197 4.21%
$1,804,180 2.68%
$67,266,428 100.00%
Less: Non-rate revenues and other adjustments ($5,608,502) January 9, 2013
($2,774,526)
($849,127)
($783,508)
($814,915)
($236,118)
($150,308)
($5,608,502) Page 176
Rate Base
367,726,680
Return on Rate Base $ Calculated Percent Return on Rate Base
12,035,435 3.27%

Alternative I&I Allocations
$30,495,939 I & I to Flow 10% $31,429,678
$9,337,390
$8,612,225
$8,961,420
$2,597,079
$1,653,872
$61,657,926
I & I to Meter Equivalents I & I to Customers 45% 45% $8,612,225 $8,961,420 $6,798,904 $5,855,697 $61,657,925
Billing Determinations
Residential Non-Residential Overstrength Surcharge Hauled Waste Total Billed Water Usage I & I to Flow 0.1 Rate Per Billing Unit Annual Residential
Flow
ML
BOD
kg
TSS
kg
Equivalent Meters
Annual Equivalents
Customer Service
Annual
22,713 13,803 499 77 37,091 35,002
3,861,213 2,975,393 1,262,827 19,318 8,118,751
3,861,213 4,658,871 247,779 11,591 8,779,454
75,422 25,969 0 0 101,390
75422 4679 0 0 80,101
Blended Rate - Flow & Strength Costs / Cubic Meter
$0.8979
$1.0608
$1.0207
$67.06
$73.10
$1.4000
$176
$35
$34
$67.06
$73.10
$385.16
January 9, 2013
Page 177
Worksheet WW-12 Rates, Revenues and Bills

Worksheet WW-12 uses the data from worksheet WW-11 to calculate proposed rates for Customer Charge, Base Charge and Volumetric Charges (effluent charge) for 2013/14 and 2014/15. Worksheet WW-12 also provides a revenue test based on the projected customer connections, equivalent meters and consumption and details the annual fixed charges (base and customer charge) and the annual effluent charge based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 178

I&I Allocation Flow / Sys Eq. / Customer at: 0.1 / 0.45 / 0.45
Customer Charge
$/Account $/Meter Equivalent $ / Billed Cubic Meter Billing Determinant 80,101 101,391
System Equivalents
$73.10
Base Charge
$67.06
Volumetric Charges Revenue Test Customer Charge Revenues

Number of Services
$1.40
$5,855,383 $6,799,247 $49,003,324 $61,657,954
Base Charge Revenues Volumetric Charges Revenues

35,001,991
Total Revenues
Bill Calculations

Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm Annual Effluent Charges
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150 $140.16 $173.69 $240.75 $140.16 $173.69 $240.75 $408.40 $609.58 $1,146.06 $1,749.60 $3,426.10 $6,108.50 $10,132.10
179 610 1,236 179 610 1,236 2,609 6,484 14,483 32,244 93,986 114,983 43,454
$250.54 $854.64 $1,730.54 $250.54 $854.64 $1,730.54 $3,652.09 $9,077.34 $20,277.07 $45,141.48 $131,582.15 $160,978.39 $60,836.27
Meter Size
Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM
179 610 1,236 179 610 1,236 2,609 6,484 14,483 32,244 93,986 114,983 43,454
$390.70 $1,028.33 $1,971.29 $390.70 $1,028.33 $1,971.29 $4,060.49 $9,686.92 $21,423.13 $46,891.08 $135,008.25 $167,086.89 $70,968.37
January 9, 2013
Page 179
Worksheet WW-13 Monthly and Quarterly Change in Wastewater Bills
Worksheet W-13 details the monthly and quarterly change in water bills for 2013/14 based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 180
Worksheet WW-13
Monthly Base Charge 2013/14 Proposed Rates 11.68 20.06
Monthly Commodity Charge 2013/14 Proposed Rates 20.88 144.21
Monthly Water Bill 2013/14 Proposed Rates
Quarterly Water Bill 2013/14 Proposed Rates
Meter Size
Current 14.91 103.01 14.91 50.87 103.01 217.38 540.31 1,206.96 2,686.96 7,832.19 9,581.94 3,621.17 12.68 31.71 $12.68 $19.03 $31.71 $63.43 $101.49 $202.98 $317.15 $634.31 $1,141.75 $1,902.93
% Change
Current 19.33 133.50 $19.33 $65.93 $133.50 $281.73 $700.24 $1,564.21 $3,482.30 $10,150.51 $12,418.20 $4,693.03
% Change
Current
% Change
Current
% Change
Unmetered 5/8" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm
$11.68 $14.47 $20.06 $34.03 $50.80 $95.51 $145.80 $285.51 $509.04 $844.34
-7.9% -36.7% -7.9% -23.9% -36.7% -46.3% -49.9% -52.9% -54.0% -55.0% -55.4% -55.6%
$20.88 $71.22 $144.21 $304.34 $756.44 $1,689.74 $3,761.75 $10,965.06 $13,414.72 $5,069.63
8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0%
$32.01 $32.56 $165.21 $164.27 $32.01 $32.56 $84.96 $85.69 $165.21 $164.27 $345.16 $338.37 $801.73 $807.24 $1,767.19 $1,785.24 $3,799.45 $3,907.55 $10,784.82 $11,250.57 $13,559.95 $13,923.76 $6,595.96 $5,913.98
1.7% -0.6% 1.7% 0.9% -0.6% -2.0% 0.7% 1.0% 2.8% 4.3% 2.7% -10.3%
$96.02 $495.62 $96.02 $254.88 $495.62 $1,035.48 $2,405.20 $5,301.58 $11,398.36 $32,354.47 $40,679.84 $19,787.89
$97.67 $492.82 $97.67 $257.08 $492.82 $1,015.11 $2,421.71 $5,355.73 $11,722.65 $33,751.70 $41,771.28 $17,741.93
1.7% -0.6% 1.7% 0.9% -0.6% -2.0% 0.7% 1.0% 2.8% 4.3% 2.7% -10.3%
January 9, 2013
Page 181
Worksheet Appendix WW-1 Additions to Utility Plant in Service

Appendix W-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2013/14. Additions to Utility Plant in Service for 2013/14 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 Capital Budget, and historical levels of contributed utility plant in service. HRWC projects addition of $96,276,000 in assets to Utility Plant in Service during the 2013/14 fiscal year.
January 9, 2013
Page 182
Halifax Regional Water Commission Wastewater Rate Study Appendix WW-1

Additions to the Utility Plant in Service Capital Cost Contribution from Others $0
Utility Cost of Plant in Service $0
INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WSW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems
TOTAL
$0
$0 $0 $0 $0 $0 $0 $35,000,000 $12,385,000 $7,574,000 $23,127,000 $0 $0 $0 $500,000 $2,365,000 $1,843,000 $10,089,000 $400,000 $0 $200,000 $994,000 $150,000 $200,000 $1,449,000 $0 $0 $0 $0 $0 $96,276,000
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $500,000 $2,165,000 $0 $2,500,000 $400,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,565,000
$0 $0 $0 $0 $0 $0 $35,000,000 $12,385,000 $7,574,000 $23,127,000 $0 $0 $0 $0 $200,000 $1,843,000 $7,589,000 $0 $0 $200,000 $994,000 $150,000 $200,000 $1,449,000 $0 $0 $0 $0 $0 $90,711,000
Sources of Funding
From others Reserves Depreciation fund Capital from Revenue Long Term Debt TOTAL $5,565,000 $4,320,000 $10,694,045 $0 $75,696,955 $96,276,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $10,694,045 $10,694,045 -$10,694,045 $0
January 9, 2013
Page 183
Worksheet Appendix WW-2 Amortization Schedule for Long Term Debt
Appendix WW-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2013/14. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Halifax Regional Water Commission Wastewater Rate Study Appendix WW-2

Interest Rate Term in years Capital Amortization Schedule Principal Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,784,847.75 $3,497,199.32 $3,322,339.35 $3,147,479.39 $2,972,619.42 $2,797,759.46 $2,622,899.49 $2,448,039.52 $2,273,179.56 $2,098,319.59 $1,923,459.63 $1,748,599.66 $1,573,739.69 $1,398,879.73 $1,224,019.76 $1,049,159.80 $874,299.83 $699,439.86 $524,579.90 $349,719.93 $174,859.97 Interest
4.62% 20 $75,696,955
Total $7,282,047.07 $7,107,187.10 $6,932,327.14 $6,757,467.17 $6,582,607.21 $6,407,747.24 $6,232,887.27 $6,058,027.31 $5,883,167.34 $5,708,307.38 $5,533,447.41 $5,358,587.44 $5,183,727.48 $5,008,867.51 $4,834,007.55 $4,659,147.58 $4,484,287.61 $4,309,427.65 $4,134,567.68 $3,959,707.72
Balance $71,912,107.25 $68,127,259.50 $64,342,411.75 $60,557,564.00 $56,772,716.25 $52,987,868.50 $49,203,020.75 $45,418,173.00 $41,633,325.25 $37,848,477.50 $34,063,629.75 $30,278,782.00 $26,493,934.25 $22,709,086.50 $18,924,238.75 $15,139,391.00 $11,354,543.25 $7,569,695.50 $3,784,847.75 $0.00
January 9, 2013
Page 184
Wastewater Rate Study 2014/15 Appendix 2B Page 1
2014/15 HRWC Wastewater Rate Study
January 9, 2013
Page 185
Notes on Worksheet Worksheet WW-1 System Data

Worksheet WW-1 provides data on various wastewater related data including; Wastewater estimated flow summary for the 2011/12 fiscal year. Projected service connections and estimated effluent billing consumption for the current year 2012/13 and the test years 2013/14 and 2014/15. Plant Balance by customer class for the year ending March 31, 2012. Average effluent loading for residential and non-residential customers for the March 31, 2012 fiscal year.
The 2014/15 test year is based on two key assumptions: 1. Water consumption (and therefore Wastewater discharge) will continue to decrease by 1.5% per year consistent with the 10 year historic average. 2. Customer connections will increase by 938 connections in 2014/15, consistent with the historic growth pattern.
January 9, 2013
Page 186

Projected Growth Estimated # of Services 2012/13 997 0 73,575 962 1,504 997 735 268 74 36 13 2 79,163
938
# of Services 3/31/2012 997 0 72,725 942 1,489 967 720 263 71 36 13 2 78,225
Projected # of Services 2013/14 997 0 74,425 982 1,519 1,027 750 273 77 36 13 2 80,101
938
938
Consumption
Total Consumption 3/31/2012 270,376 0 13,727,544 617,859 1,935,239 2,761,252 5,012,044 4,075,328 2,558,947 3,487,340 1,540,656 89,575 36,076,160
Estimated Estimated Estimated Consumption Consumption Consumption 2012/13 2013/14 2014/15 266,320 0 13,521,631 608,591 1,906,210 2,719,833 4,936,863 4,014,198 2,520,563 3,435,030 1,517,546 88,231 35,535,018
-1.50%
262,326 0 13,318,806 599,462 1,877,617 2,679,036 4,862,810 3,953,985 2,482,754 3,383,504 1,494,783 86,908 35,001,992
-1.50%
258,391 0 13,119,024 590,470 1,849,453 2,638,850 4,789,868 3,894,675 2,445,513 3,332,752 1,472,361 85,604 34,476,962
-1.50%
35,962,294 283,373 270,376 36,516,043 -439,883 36,076,160
January 9, 2013
Page 187

Halifax Regional Water Commission Wastewater Rate Study Worksheet WW-1 User Characteristics and Plant Balance Analysis
SCENARIO SUMMARY Customer Class Date Test Years
1 2 January 3, 2013
Flow Summary (ML) 2012 13,657 8,785 5,167 2,435 6,201 270 36,516
2013/14 2014/15 2012/13 2011/12
Current Year Budget (Projections) Historical Year
Residential (Single Family) Residential (Multi-family) Commercial Industrial Institutional Unmetered Subtotal Customer Other Flow Infiltation & Inflow Stormwater Subtotal Other Total Estimated
Service Connections, Equivalents and Billed Water Consumption 2014/15 Number of Services 997 75275 1002 1534 1057 765 278 80 36 13 2 81,039 System Equivalents 997 0 0 75,275 1,503 3,835 5,285 6,120 4,448 2,000 1,800 1,170 300 102,733 Estimated Consumption (Cubic Meters) 258,391 0 0 13,119,024 590,470 1,849,453 2,638,850 4,789,868 3,894,675 2,445,513 3,332,752 1,472,361 85,604 34,476,961
43,908
Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm TOTAL
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150
43,908 80,424
Halifax Dartmouth Other Plants Total Plants Total Other Flow
38,620 21,554 20,251 80,424 55%
Plant Balance Flow Customer Class Residential Non-Residential Overstrength Surcharge Hauled Waste Subtotal Customer Other Flow Subtotal Other Total Estimated Total Plants
ML kg
BOD
mg/l kg
TSS
mg/l
Other User Characteristics Customer Equivalent Meters Service

Annual Equivalents Annual
22,713 13,803 499 77 36,516 43,908 43,908 80,424
3,861,213 2,975,393 1,262,827 19,318 8,118,751 1,097,704 1,097,704 9,216,455 9,216,455
170 216 2,533 250
3,861,213 4,658,871 247,779 11,591 8,779,454 1,097,704 25 115 1,097,704 9,877,158 9,877,158
170 338 497 150
76,272 26,461
76,272 4,767
Dwelling Unit Characteristics 25 25 25 123

Assume all 5/8" customers are Residential Assume 65% of Dwelling Units are single family
Single family Dwelling Units Multi family Dwelling Units
Total Dwelling Units
76,272 41,070 117,342
Residential Non-Residential
Average Per Dwelling Unit for Residential and Per Account for Non Residential Cubic Meters KG KG 194 32.98 32.98 2,896 624.26 977.47
January 9, 2013
Page 188
Worksheet WW-2 Operations

Worksheet WW-2 provides a comparative Statement of Operations for fiscal years ending March 31 as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for wastewater service as per the Audited Financial Statements. Projected results for the current fiscal year (April 1, 2012 to March 31, 2013) for wastewater service, as at November 30, 2012. Budgeted revenue and expenditures for both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at current rates, and separated between regulated and non-regulated services. This worksheet details the projected deficit at current rates in water service for the test years.
Wastewater Services had a small profit on both the regulated and non-regulated operations of $731k at March 31, 2012. The small profit represented 0.014% of total revenues. A loss of ($425k) (or 0.007% of total revenues) is projected for the current year 2012/13 as of November 30, 2012. A loss of ($10,124,735) and ($21,519,384) are projected for 2013/14 and 2014/15 respectively. It is important to note that the Operating Statements and Audited Financial Statements include some accrued and unregulated items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet WW-3.
January 9, 2013
Page 189

Fiscal Years ending March 31st Test Year #1 2013/14 Budget Test Year #2 2014/15 Budget
2011/12 Actual OPERATING REVENUES Regulated Activities Base and Effluent Charges Overstrength Surcharge Late Payment Fees Other - Miscellaneous Sub-total Unregulated Activities Contract Revenue AeroTech Septage Tipping Fees Airline Effluent Dewatering Facility/ Sludge Lagoon Sub-total Total Operating Revenues OPERATING EXPENDITURES Regulated Activities Wastewater Collection Wastewater Treatment Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Calculated Depreciation Rate Sub-total Unregulated Activities Wastewater Treatment Total Operating Expenditures OPERATING PROFIT (LOSS) NON-OPERATING REVENUES Regulated Activities Provincial Funding - Harbour Solutions Interest and other income Other - Miscellaneous Sub-total Unregulated Activities Other - Miscellaneous Total Non-Operating Revenues NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt - Principal (2013/14) New Debt - Interest (2013/14) New Debt - Principal (2014/15) New Debt - Interest (2014/15) Total Non-Operating Expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES SURPLUS (DEFICIT) BEGINNING OF THE YEAR ACCUMULATED SURPLUS (DEFICIT)
2012/13 Projections
$49,569,355 $165,016 $130,099 $102,874 $49,967,344 $807,100 $746,557 $39,780 $97,850 $1,691,287 $51,658,631
$53,556,225 $204,000 $160,397 $128,300 $54,048,922 $499,203 $600,000 $74,284 $182,255 $1,355,742 $55,404,664
$54,426,473 $180,000 $148,916 $128,300 $54,883,689 $437,343 $715,000 $94,283 $209,673 $1,456,299 $56,339,988
$53,536,002 $180,000 $146,614 $128,300 $53,990,916 $440,640 $715,000 $94,283 $209,673 $1,459,596 $55,450,512
$9,834,870 $16,482,747 $785,576 $2,402,259 $1,153,180 $1,357,222 $2,902,046 $4,915,898 $39,833,798 $630,689 $40,464,487 $11,194,144
$9,520,468 $16,321,315 $821,208 $2,794,937 $1,225,320 $1,419,283 $3,589,022 $7,566,629 $43,258,182 $778,243 $44,036,425 $11,368,239
$10,190,002 $18,034,505 $1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $10,400,339 $49,622,486 $1,609,478 $51,231,964 $5,108,024
$10,506,453 $18,569,091 $1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $11,947,954 $52,357,548 $1,027,489 $53,385,037 $2,065,475
$2,000,000 $201,136 $22,821 $2,223,957 $63,717 $2,287,674
$2,000,000 $350,000 $24,000 $2,374,000 $55,368 $2,429,368
$2,000,000 $330,000 $24,000 $2,354,000 $57,178 $2,411,178
$2,000,000 $330,000 $24,000 $2,354,000 $58,036 $2,412,036
$7,546,404 $5,192,341 $12,321 $0 $0 $0 $0 $12,751,066 $730,752 $2,629,047 $3,359,799
$8,867,984 $5,317,789 $36,892 $0 $0 $0 $0 $14,222,665 ($425,058) $3,359,799 $2,934,741
$9,314,418 $4,621,837 $66,658 $1,892,424 $1,748,600 $0 $0 $17,643,937 ($10,124,735) $2,934,741 ($7,189,993)
$11,031,603 $6,808,175 $102,493 $3,784,848 $3,322,339 $492,431 $455,006 $25,996,895 ($21,519,384) ($7,189,993) ($28,709,377)
January 9, 2013
Page 190
Worksheet WW-3 Revenue Requirements

Worksheet WW-3 takes the operating and non-operating expenditure information from Worksheet WW-2 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from customer rates. Adjustments are made for the difference in the pension & employee future benefits expense calculation per CICA section 3461 for accounting purposes, and the actual funding required per the current actuarial valuation. Additionally, adjustments are made for debt servicing payments for Eastern Passage WWTF which was pre-financed. HRWC accrues this debt servicing for accounting purposes, but will not include the debt servicing payments in the revenue requirements until the asset is in service. As per the Boards direction from the last general rate application, sponsorship and donation expenses and the funding for the Good Neighbours/Help 2 Others (H20 Program), are not included in revenue requirements. This indirectly impacts Wastewater Services through the allocation from Administration and Pension.
January 9, 2013
Page 191

Fiscal Years ending March 31st Test Year #1 2013/14 Budget $10,190,002 $18,034,505 $1,096,207 $3,116,507 $1,339,931 $1,654,986 $3,790,009 $39,222,147 $10,400,339 $49,622,486 Test Year #2 2014/15 Budget $10,506,453 $18,569,091 $1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $40,409,594 $11,947,954 $52,357,548
2011/12 Actual OPERATING EXPENDITURES Wastewater Collection Wastewater Treatment Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Calculated Depreciation Rate Total ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt - Principal (2013/14) New Debt - Interest (2013/14) New Debt - Principal (2014/15) New Debt - Interest (2014/15) Total LESS NON-OPERATING REVENUES Regulated Activities Provincial Funding - Harbour Solutions Interest and other income Other - Miscellaneous Total LESS OTHER OPERATING REVENUE Regulated Activities Overstrength Surcharge Late Payment Fees Other - Miscellaneous Total LESS OTHER ADJUSTMENTS Debt Serving (Pre-Financing) Pension Adjustment ($2.4M x 40.67%) Sponsorships and Donations (Wastewater portion 40.67%) $9,834,870 $16,482,747 $785,576 $2,402,259 $1,153,180 $1,357,222 $2,902,046 $34,917,900 $4,915,898 $39,833,798
2012/13 Projections $9,520,468 $16,321,315 $821,208 $2,794,937 $1,225,320 $1,419,283 $3,589,022 $35,691,553 $7,566,629 $43,258,182
$7,546,404 $5,192,341 $12,321 $0 $0 $0 $0 $12,751,066
$8,867,984 $5,317,789 $36,892 $0 $0 $0 $0 $14,222,665
$9,314,418 $4,621,837 $66,658 $1,892,424 $1,748,600 $0 $0 $17,643,937
$11,031,603 $6,808,175 $102,493 $3,784,848 $3,322,339 $492,431 $455,006 $25,996,895
$2,000,000 $201,136 $22,821 $2,223,957
$2,000,000 $350,000 $24,000 $2,374,000
$2,000,000 $330,000 $24,000 $2,354,000
$2,000,000 $330,000 $24,000 $2,354,000
$165,016 $130,099 $102,874 $397,989
$0 $499,203 $0 $499,203
$180,000 $148,916 $128,300 $457,216
$180,000 $146,614 $128,300 $454,914
$0 $260,613 $0 $260,613
$0 $976,080 $0 $976,080
$1,799,000 $976,080 $22,206 $2,797,286
$0 $976,080 $22,206 $998,286
REVENUE REQUIRED FROM CUSTOMERS
$49,702,304
$53,631,564
$61,657,921
$74,547,243
January 9, 2013
Page 192
Worksheet WW-4 Operating Expenditure Analysis

Worksheet WW-4 details the operating expenditures by cost element for each wastewater operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over $20,000 or 5%. Costs for stormwater service are shown in a separate rate study. Total Operating Expenses were $39,833,798 for 2011/12 and are projected to be $43,258,182 or 9% ($3,424,384) higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $6,364,304 or 15% over 2012/13 for a total of $49,622,486. Increased depreciation accounts for 45% or $2,833,710 of the increase in 2013/14. Total Operating Expenses for 2014/15 are projected to increase 6% or $2,735,062 over 2013/14, with 57% of the increase due to depreciation. The other primary drivers in 2013/14 and 2014/15 are salaries and benefits, chemicals, contract services and electricity. Further detailed analysis is provided for each category of wastewater operating expense. The increase in depreciation from 2013/14 to 2014/15 in the amount of $1,547,615 is driven by depreciation on assets associated with previously approved capital budgets, and the 2013/14 and 2014/15 capital budgets, which were developed based on the Integrated Resource Plan (IRP). Assets first capitalized in 2013/14 will have a full year depreciation, and assets capitalized in 2014/15 will have a half year depreciation. The largest increases are in IT, transportation equipment and treatment plants/ equipment. It should be noted, depreciation for 2014/15 in the amount of $11,947,954 appearing in Worksheet WW-4 below differs from the depreciation amount of $12,613,700 (including depreciation of the Regulatory Asset) shown on Worksheet WW-7, Continuity Schedule Utility Plant in Service. The difference of $665,746 relates to depreciation on transportation equipment, which is expenditure within Fleet Services.
January 9, 2013
Page 193

Worksheet WW-4
January 3, 2013


2011/12 Actual 2012/13 Projections $7,566,629 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $10,400,339 $11,947,954 ( year over year - $ and % ) 2012/13 Projections $2,650,731 54% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $2,833,710 37% $1,547,615 15%
Depreciation
$4,915,898
$3,424,384 9%
$6,364,304 15%
$2,735,062 6%
January 9, 2013
Page 194
Wastewater Rate Study 2014/15 Appendix 2B Page 11 Wastewater Collection Salaries and Benefits - The 2014/15 costs are budgeted to increase 3% or $130k from 2013/14. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. Contract Services - Contract Services is a significant component of Wastewater Collection and is comprised of road and street repairs, contracts for stone and crusher run, grounds and landscaping work, and contracts for hired equipment. Contract Services is projected to increase by 1% or $36k in 2014/15 over projected 2013/14 due to allowance for Inflation based increases in some contracts. Electricity Is budgeted to increase by 10% or $161k in 2014/15 over projected 2013/14 based on projected consumption and rate increases. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan.
January 9, 2013
Page 195


Wastewater Collections
Salaries and Benefits $3,982,680 $4,108,008 $4,149,651 $4,279,854 $125,328 3% $52,563 109% ($511,119) -18% $87,016 6% ($197,833) -23% $179,737 59% ($28,317) -4% $25,718 47% $19,810 13% ($61,622) 18% ($5,682) 14% ($314,402) -3% $41,643 1% $9,000 9% $220,389 10% $152,128 10% $103,010 16% ($276,500) -57% $396,844 62% $0 0% $78,991 45% ($44,336) 11% ($11,635) 25% $669,534 7% $130,203 3% ($4,500) -4% $36,102 1% $160,873 10% ($11,600) -2% $3,400 2% $3,001 0% $0 0% $9,014 4% ($8,934) 2% ($1,108) 2% $316,451 3%
$48,437
$101,000
$110,000
$105,500
Contract Services
$2,798,540
$2,287,421
$2,507,810
$2,543,912
Electricity
$1,374,597
$1,461,613
$1,613,741
$1,774,614
$842,023
$644,190
$747,200
$735,600
$302,763
$482,500
$206,000
$209,400
Fleet Services
$666,301
$637,984
$1,034,828
$1,037,829
Chemicals
$54,282
$80,000
$80,000
$80,000
$155,584
$175,394
$254,385
$263,399
Allocated to SW Services re: Combined Sewers
($349,492)
($411,114)
($455,450)
($464,384)
Allocated to SW Services re: Regional Administration
($40,846)
($46,528)
($58,163)
($59,271)
Total Wastewater Collections $9,834,870
$9,520,468
$10,190,002 $10,506,453
January 9, 2013
Page 196
Wastewater Rate Study 2014/15 Appendix 2B Page 13 Wastewater Treatment Salaries and Benefits - Are budgeted to increase by 4% or $195k in 2014/15 over projected 2013/14. The projected increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. The increase includes full year salaries and benefits for two new staff planned for 2013/14 for a half year - a new Labourer at the Eastern Passage WWTF, and a Works Advisor. Training and Development - Is projected to decrease by 7% or ($5k) in 2014/15 compared to 2013/14 due to less staff training related to wastewater treatment.. Contract Services - Contract Services are a significant component of Wastewater Treatment and include trucking and de-watering of bio-solids. Contract Services are projected to increase by 3% or ($122k) in 2014/15 compared to projected 2013/14 due to projected increases in the Seaboard trucking contract and the N-Viro Contract which are based on volumes and inflationary increases.. Electricity - Is budgeted to increase by 10% or $300k in 2014/15 over projected 2013/14 due to projected consumption and rates. A separate schedule for projected electricity expenditures is shown in Appendix 7 and additional information on the Energy Management initiatives is contained in the 5 Year Business Plan. Materials, Supplies and Services - Materials, Supplies and Services are a significant component of Wastewater Treatment, and are comprised of items such as of tools and equipment, heating fuel, and water. Materials, Supplies and Services are projected to decrease by 6% or ($155k) in 2014/15 compared to projected 2013/14 due to completion of a roof repair in Mill Cove in 2013/14 ($75k) and replacement of rotor and stators at the DWWTF ($80k) in 2013/14 Chemicals - Are budgeted to increase by 4% or $96k in 2014/15 over projected 2013/14, based on actual calculations of tendered prices, dosage and flow rates based on estimates from chemical providers of 5% increases in chemical prices. Chemicals will be tendered in January for contracts beginning April 1st, so this is a budget risk for HRWC. A separate schedule for projected chemicals expenditures is shown in Appendix 7. Operating Cost Recoveries - Are comprised of (i) recoveries relating to trucking of sludge, (ii) recoveries relating to Regional Administration and (iii) recoveries from Developers. Contractors. Recoveries (i) and (ii) are standard entries as a part of HRWCs expense allocation process, charged to the De-watering Facility. Recoveries from Developers/ Contractors are operating expenses paid by HRWC relating to the new Eastern Passage Treatment Facility being constructed, which are recoverable from the contractor as part of the contract.
January 9, 2013
Page 197


Salaries and Benefits $4,142,905 $4,358,630 $4,790,058 $4,985,354 $215,725 5% $31,496 80% ($342,340) -7% ($801) 0% ($28,539) -1% ($173,505) -83% ($18,063) -5% $233,845 13% ($69,257) -24% ($5,289) 18% ($4,704) 26% $0 0% ($161,432) -1% $431,428 10% $11,200 16% $485,972 11% $522,832 21% $137,030 5% $150 0% $25,642 8% $281,549 13% $4,416 2% $3,360 -10% ($5,145) 23% ($185,244) 0% $1,713,190 10% $195,296 4% ($5,400) -7% $122,394 3% $299,916 10% ($154,548) -6% ($250) -1% $912 0% $95,893 4% $6,921 3% ($464) 2% ($613) 2% ($25,471) 14% $534,586 3%
$39,504
$71,000
$82,200
$76,800
Contract Services
$4,608,167
$4,265,827
$4,751,799
$4,874,193
Electricity
$2,494,638
$2,493,837
$3,016,669
$3,316,585
$2,536,154
$2,507,615
$2,644,645
$2,490,097
$209,805
$36,300
$36,450
$36,200
Fleet Services
$352,273
$334,210
$359,852
$360,764
Chemicals
$1,855,917
$2,089,762
$2,371,311
$2,467,204
$290,118
$220,861
$225,277
$232,198
Operating Cost Recoveries re: trucking of sludge
($28,820)
($34,109)
($30,749)
($31,213)
Operating Cost Recoveries re: Regional Administration
($17,914)
($22,618)
($27,763)
($28,376)
Operating Cost Recoveries re: Developers/ Contractors
$0
$0
($185,244)
($210,715)
Total Wastewater Treatment $16,482,747 $16,321,315 $18,034,505 $18,569,091
January 9, 2013
Page 198
Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Explanations for detailed variances within Technical Services are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on data points. For additional information regarding the allocation of Technical Services (SCADA) across the Utility, refer to page 21 of the Cost of Service Rate Design Manual. The 5% or $54k increase in the Technical Services costs for Wastewater Services are due the detailed variances as described in the Water Rate Study, found in the notes contained to Worksheet W-4. The portion allocated to Wastewater Services in 2014/15 is the same as 2013/14 and is based on methodology identified in the Cost of Service Rate Design Manual.


$785,576
$821,208
$1,096,207
$1,149,812
$35,632 5%
$274,999 33%
$53,605 5%
January 9, 2013
Page 199
Wastewater Rate Study 2014/15 Appendix 2B Page 16 Engineering and IS Explanations for detailed variances within Engineering and IS are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Engineering and IS across the Utility, refer to pages 21-22 of the Cost of Service Rate Design Manual. The Wastewater Services portion of Engineering and IS costs is increasing by 7% or $208k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.

$2,402,259
$2,794,937
$3,116,507
$3,324,658
$392,678 16%
$321,570 12%
$208,151 7%
January 9, 2013
Page 200
Environmental Services Explanations for detailed variances within Environmental Services are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on a determination of the Director of Environmental Services, based on budgeted costs and staff time employed. For additional information regarding the allocation of Environmental Services across the Utility, refer to pages 22-23 of the Cost of Service Rate Design Manual. The Wastewater Services portion of Environmental Services is increasing by 3% or $35 k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.


$1,153,180
January 9, 2013
Page 201
Wastewater Rate Study 2014/15 Appendix 2B Page 18 Customer Service Explanations for detailed variances within Customer Service are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Customer Service across the Utility, refer to page 23 of the Cost of Service Rate Design Manual. From an accounting perspective, common cost allocations relating to Customer Service are as referenced in the manual above, with one exception as they relate to the cost of service. Included in Water and Wastewater Services are two (2) specific system functions that are not applicable in Stormwater, namely Meters and Meter Reading/Billing. For 2014/15, under the traditional accounting allocation method Stormwater Services would have been charged $311,228 (see Water Rate Study, Worksheet W-4). A deduction of $157,012 has been applied, reducing the cost allocated to Stormwater to $154,216. Allocated Customer Service costs in Wastewater have been increased by $157,012 accordingly. For 2014/15 under the traditional accounting allocation method Wastewater would have been charged $1,521,019 (see Water Rate Study, Worksheet W-4), however allocated amounts have now been increased to $1,678,031. The Wastewater Services portion of Customer Service is increasing by 1% or $23 k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the COS Manual.


Customer Service
$1,357,222
$1,419,283
$1,654,986
$1,678,031
$62,061 5%
$235,703 17%
$23,045 1%
January 9, 2013
Page 202
Wastewater Rate Study 2014/15 Appendix 2B Page 19 Administration and Pension Explanations for detailed variances within Administration and Pension are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Administration and Pension across the Utility, refer to page 24 of the Cost of Service Rate Design Manual.
The Wastewater Services portion of Administration and Pension is increasing by $17k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.

$2,902,046
$3,589,022
$3,790,009
$3,806,562
$686,976 24%
$200,987 6%
$16,553 0%
January 9, 2013
Page 203
Worksheet WW-5 Cost of Service (COS) Structure

Worksheet WW-5 details the customer classifications, cost functions with allocated percentages, service characteristics and operating and capital cost classifications for wastewater services as detailed in the Cost of Service Rate Design Manual.
January 9, 2013
Page 204

Worksheet WW-5
Customer Classifications, Cost Functions & Service Characteristics
SF Residential Unmetered Multi-family Commercial - General Industrial Institutional
System Functions
Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General

Operating Classifications
Function Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
Capital Classifications
Function Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Customer Service Meters Engineering and IS Environmental Services Administration and General
38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
January 9, 2013
Page 205
Worksheet WW-6 Operating Expense Functionalization

Worksheet WW-6 details the wastewater service operating expense categories cost elements, by the system functions detailed in the Cost of Service Rate Design Manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet WW-10 to allocate the costs to the service characteristics.
January 9, 2013
Page 206

Test Year

Advanced Primary Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
OPERATING EXPENSES
2014/15 Budget Secondary Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Tertiary Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Pump Stations 49% 49% 10% 99% 62% 47% 45% 100% 49% 20% 49%
Mains 41% 36% 51% 0% 30% 39% 45% 0% 36% 73% 36%
Service Laterals 10% 15% 40% 0% 7% 15% 10% 0% 15% 7% 15%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Advanced Primary Treatment 59% 70% 77% 66% 63% 73% 28% 85% 69% 0% 0% 0%
Secondary Treatment 30% 22% 21% 25% 26% 25% 38% 8% 23% 57% 26% 100%
Tertiary Treatment 11% 8% 3% 8% 10% 3% 34% 7% 8% 43% 74% 0%
Mains 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Pump Stations 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Service Laterals 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meters 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

January 9, 2013
Page 207

Test Year

Advanced Primary Secondary Treatment Treatment 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Meter Reading and Engineering Environmental Administration Billing and IS Services and General 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 31% 0% 0% 0% 0% 0% 0% 100%
OPERATING EXPENSES
2014/15 Budget Tertiary Treatment 0% 0% 0% 0% 0% Pump Stations 0% 0% 0% 0% 0%
$1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $11,334,050
Mains 0% 0% 0% 0% 0%
Service Laterals 0% 0% 0% 0% 0%
Technical Services 100% 0% 0% 0% 0%
Customer Service 0% 0% 0% 45% 0%
Meters 0% 0% 0% 24% 0%
Total O&M Expense
$40,409,594
January 9, 2013
Page 208

Test Year

Advanced Primary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Meter Administrati Reading and Engineering Environment on and Billing and IS al Services General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
OPERATING EXPENSES
2014/15 Budget Secondary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Tertiary Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Pump Stations $2,078,819 $51,341 $243,572 $1,764,103 $458,468 $97,524 $465,779 $80,000 $128,183 ($94,696) ($28,865) $5,244,230
Mains $1,754,369 $37,878 $1,292,465 $7,352 $222,157 $80,951 $470,482 $0 $94,570 ($338,160) ($21,278) $3,600,786
Service Laterals $446,666 $16,280 $1,007,875 $3,159 $54,974 $30,924 $101,568 $0 $40,646 ($31,528) ($9,128) $1,661,437
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,279,854 $105,500 $2,543,912 $1,774,614 $735,600 $209,400 $1,037,829 $80,000 $263,399 ($464,384) ($59,271) $10,506,453
Advanced Primary Treatment $2,941,499 $53,800 $3,733,422 $2,201,461 $1,578,942 $26,308 $101,838 $2,089,542 $159,085 $0 $0 $0 $12,885,896
Secondary Treatment $1,503,686 $17,072 $1,005,647 $842,503 $654,232 $8,921 $136,530 $208,133 $54,485 ($17,885) ($7,264) ($210,715) $4,195,344
Tertiary Treatment $540,170 $5,928 $135,124 $272,621 $256,923 $972 $122,396 $169,529 $18,628 ($13,328) ($21,112) $0 $1,487,851
Mains $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Pump Stations $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Service Laterals $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meters $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Meter Administrati Reading and Engineering Environment on and Billing and IS al Services General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $4,985,354 $76,800 $4,874,193 $3,316,585 $2,490,097 $36,200 $360,764 $2,467,204 $232,198 ($31,213) ($28,376) ($210,715) $18,569,091
January 9, 2013
Page 209

Test Year

Advanced Primary Secondary Treatment Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Meter Administrati Reading and Engineering Environment on and Billing and IS al Services General $0 $0 $0 $0 $0 $3,324,658 $0 $0 $0 $0 $1,374,987 $0 $515,431 $0 $0 $0 $0 $0 $0 $3,806,562 $515,431 $3,324,658 $1,374,987 $3,806,562
OPERATING EXPENSES
2014/15 Budget Tertiary Treatment $0 $0 $0 $0 $0 $0 Pump Stations $0 $0 $0 $0 $0 $0
Mains $0 $0 $0 $0 $0 $0
$1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $11,334,050
Service Laterals $0 $0 $0 $0 $0 $0
Technical Services $1,149,812 $0 $0 $0 $0 $1,149,812
Customer Service $0 $0 $0 $753,677 $0 $753,677
Meters $0 $0 $0 $408,923 $0 $408,923
Total $1,149,812 $3,324,658 $1,374,987 $1,678,031 $3,806,562 $11,334,050
Total O&M Expense
$40,409,594
$12,885,896
$4,195,344
$1,487,851
$3,600,786
$5,244,230
$1,661,437
$1,149,812
$753,677
$408,923
$515,431
$3,324,658
$1,374,987
$3,806,562
$40,409,594
January 9, 2013
Page 210
Worksheet WW-7 Continuity Schedule Utility Plant in Service

Worksheet WW-7 provides additional detail on Funding Utility Plant in Service, Contributed Assets, Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation on transportation equipment.
January 9, 2013
Page 211

Wastewater Rate Study
Worksheet WW-7
Work in Process approved in Utility Plant Previous in Service Projected Years Additions in Contributed in Retirements 2014-15 2014-15 2014-15 2014-15
Contributed Portion Mar-14 3,012,600 1,108,071 1,351,711 90,726 915,577 1,548,379 54,134,501 39,396,235 42,105,689 178,755 5,815,434 2,851,723 2,754,924 10,666,443 145,244,800 4,544,560 11,866,837 5,915,828
Accumulated Depreciation on funded assets Mar-14 578,133 185,117 3,935,984 2,001,795 468,231 16,536,483 4,542 217,213 162,413 6,675 85,273 81,000 2,412,737 169,509 459,983 479,985
Accumulated Depreciation on donated assets Mar-14 1,149,518 124,559 37,302,148 3,066,294 7,755,071 26,241 5,262,694 418,806 104,801 285,179 44,476,493 422,616 340,753 294,420
Projected Net Book Value Depreciation before expense on Regulatory Depreciation funded assets asset expense Mar-15 2014/15 98,813 51,818 2,031,742 688,699 516,829 5,485,079 1,817 35,411 62,321 2,803 53,865 75,000 824,241 42,558 127,772 858 9,037 11,668 161,312 4,915 1,036 1,104 2014/15 -
Intangible Plant Tangible Plant Land WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land Structures - WW WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings Treatment & Pump Equipment WW WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Airport-Aerotech WW Manholes Mains WW WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion January WW Outfalls 9, 2013
988,129 2,516,631 2,703,421 57,902 255,339 586,128 2,072,736 103,938,496 27,816,433 13,721,059 140,475,571 36,337 823,011 1,168,208 140,174 3,777,320 5,315,000 57,948,190 2,127,912 10,946,635 9,689,343
4,000,730
4,000,730
1,727,651
-
2,273,078
3,624,702 4,055,132 148,629 255,339 1,501,705 3,621,115 158,072,997 67,212,669 13,721,059 182,581,260 215,092 6,638,445 4,019,931 2,895,097 14,443,764 5,315,000 203,192,989 6,672,471 22,813,472 15,605,171
960,000 150,000 625,000 7,099,000 2,500,000 400,000 2,165,000 500,000 5,478,000 7,000,000 10,612,000
3,624,702 4,055,132 148,629 255,339 1,501,705 3,621,115 165,072,997 77,824,669 13,721,059 188,059,260 215,092 6,638,445 4,019,931 3,395,097 16,758,764 5,940,000 212,791,989 7,072,471 22,813,472 16,565,171
309,676 41,238,131 5,068,089 468,231 24,291,555 30,783 5,479,907 581,218 111,475 370,452 81,000 46,889,230 592,125 800,736 774,406
3,624,702 4,055,132 148,629 255,339 1,501,705 3,311,438 123,834,865 72,756,580 13,252,829 163,767,705 184,309 1,158,537 3,438,712 3,283,622 16,388,312 5,859,000 165,902,759 6,480,347 22,012,737 15,790,765
Page 212 135,324

Wastewater Rate Study
Worksheet WW-7
Work in Process approved in Utility Plant Previous in Service Projected Years Additions in Contributed in Retirements 2014-15 2014-15 2014-15 2014-15
Accumulated Depreciation Mar-14 6,334,794 660,812 161,357 1,407,518 27,367 29,897 486,573 859,551
Accumulated Depreciation on funded assets Mar-14 980,359 404,286 161,357 1,407,518 18,892 25,551 188,864 87,778
Accumulated Depreciation on donated assets Mar-14 5,354,435 256,526 8,475 4,346 297,709 771,773
Projected Net Book Value Depreciation before expense on Regulatory Depreciation funded assets asset expense Mar-15 2014/15 2014/15 665,746 134,807 140,822 1,126,029 9,532 10,132 52,646 49,966 -
Equipment WW WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment Small Systems - WW WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems URBAN CORE SUB-TOTAL
2,927,721 1,610,680 594,109 3,816,684 180,631 12,461 689,905 1,850,192
5,354,427 473,743 48,428 517,610 250,000 3,293,239 826,600
8,282,148 2,084,423 594,109 3,816,684 229,059 530,071 250,000 3,983,144 2,676,792 743,053,197
35,441,000 5,565,000 804,000 135,000 200,000 2,378,000
9,086,148 2,219,423 794,109 6,194,684 229,059 530,071 250,000 3,983,144 2,676,792 784,059,197
2,751,353 1,558,611 632,752 4,787,166 201,692 500,174 250,000 3,496,571 1,817,241

-
398,786,358
344,266,839
138,782,535
31,059,678
107,722,857
645,276,662
12,423,771
189,929
January 9, 2013
Page 213
Worksheet WW-8 Depreciation Functionalization

Worksheet WW-8 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Rate Design Manual both in a percentage and dollar format. These are then used in Worksheet WW-10 to allocate depreciation to the service characteristics.
January 9, 2013
Page 214


Advanced Primary Secondary Tertiary Treatment Treatment Treatment INTANGIBLE PLANT 0% 0% Meter Reading and Billing
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
$98,813
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
LAND $0 $0 $0 $0 $0 $52,677 $2,040,779 $700,367 $516,829 $5,646,391 $1,817 $35,411 $62,321 $2,803 $53,865 $75,000 $829,155 $42,558 $128,808 $136,427 $134,807 $140,822 $1,126,029 $9,532 $10,132 $0 $52,646 $49,966 $11,947,954 90% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% STRUCTURES 80% 0% 0% 70% 20% 10% 0% 0% 0% 0% 0% 0% TREATMENT & PUMP EQUIPMENT 70% 30% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 80% 20% 0% EQUIPMENT 0% 0% 0% 40% 40% 20% 0% 0% 0% SMALL SYSTEMS 0% 0% 80% 0% 80% 0% 0% 80% 0% 0% 0% 80% 0% 0% 80% 10% 0% 0% 0% 100% 20% 0% 0% 0% 0% 0% 0% 0% 100% 100% 50% 100% 0% 100% 0% 50% 0% 0% 10% 10% 10% 10% 10% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 100% 100% 0% 0% 0% 50% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 25% 0% 0% 10% 10% 10% 10% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0%
January 9, 2013
Page 215


Advanced Primary Treatment Meter Reading and Billing
Secondary Treatment
Tertiary Treatment
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
Total
$98,813
INTANGIBLE PLANT $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$98,813
$98,813
LAND $0 $0 $0 $0 $0 $52,677 $2,040,779 $700,367 $516,829 $5,646,391 $1,817 $35,411 $62,321 $2,803 $53,865 $75,000 $829,155 $42,558 $128,808 $136,427 $134,807 $140,822 $1,126,029 $9,532 $10,132 $0 $52,646 $49,966 $11,947,954 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 STRUCTURES $42,141 $0 $0 $1,428,545 $408,156 $204,078 $0 $0 $0 $0 $0 $0 TREATMENT & PUMP EQUIPMENT $3,952,474 $1,693,917 $0 $0 $0 $0 $0 $0 $0 $0 $0 $62,321 $0 $0 $0 MAINS $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $109,142 $27,285 $0 EQUIPMENT $0 $0 $0 $56,329 $56,329 $28,164 $0 $0 $0 SMALL SYSTEMS $0 $0 $7,625 $0 $8,105 $0 $0 $0 $0 $0 $0 $42,117 $0 $0 $39,973 $5,588,631 $2,193,792 $384,278 46.77% 18.36% 3.22% $0 $0 $0 $0 $0 $10,535 $0 $0 $0 $0 $0 $0 $0 $2,803 $53,865 $37,500 $829,155 $0 $128,808 $0 $67,404 $0 $0 $953 $1,013 $0 $5,265 $4,997 $1,142,298 9.56% $0 $0 $0 $0 $0 $0 $0 $700,367 $0 $0 $1,817 $35,411 $0 $0 $0 $37,500 $0 $0 $0 $0 $33,702 $0 $0 $0 $0 $0 $0 $0 $808,797 6.77% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $42,558 $0 $0 $33,702 $0 $0 $953 $1,013 $0 $5,265 $4,997 $88,488 0.74% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $281,507 $0 $0 $0 $0 $0 $281,507 2.36% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $281,507 $0 $0 $0 $0 $0 $281,507 2.36% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $281,507 $0 $0 $0 $0 $0 $281,507 2.36% $0 $0 $0 $0 $0 $0 $0 $0 $516,829 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $281,507 $0 $0 $0 $0 $0 $897,149 7.51% $0 $0 $0 $0 $0 $52,676 $2,040,779 $700,367 $516,829 $5,646,391 $1,817 $35,411 $62,321 $2,803 $53,865 $75,000 $829,155 $42,558 $128,808 $136,427 $134,808 $140,822 $1,126,028 $9,531 $10,131 $0 $52,647 $49,967 $11,947,954 100.01%
January 9, 2013
Page 216
Worksheet WW-9 Allocation of Utility Plant in Service

Worksheet WW-9 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Rate Design Manual both in a percentage and dollar format. These are then used in Worksheet WW-10 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 217


INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion SW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems Total
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
Meter Reading and Engineering Billing and IS
Environmental Administration Services and General
$4,000,730
$1,826,464
$2,174,265
$1,863,082
$311,183
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
100%
LAND $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,621,115 $165,072,997 $77,824,669 $13,721,059 $188,059,260 $215,092 $6,638,445 $4,019,931 $3,395,097 $16,758,764 $5,940,000 $212,791,989 $7,072,471 $22,813,472 $16,565,171 $9,086,148 $2,219,423 $794,109 $6,194,684 $0 $0 $0 $0 $0 $361,495 $43,269,874 $5,756,788 $985,059 $29,776,633 $32,600 $5,515,318 $643,539 $114,279 $424,317 $156,000 $47,713,471 $634,683 $928,508 $909,729 $7,000,540 $795,620 $302,179 $2,533,547 $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,259,620 $121,803,123 $72,067,880 $12,736,000 $158,282,627 $182,492 $1,123,127 $3,376,391 $3,280,819 $16,334,447 $5,784,000 $165,078,519 $6,437,789 $21,884,964 $15,655,441 $2,085,607 $1,423,803 $491,930 $3,661,137 $1,108,071 $1,351,711 $90,726 $0 $915,577 $1,423,819 $16,832,353 $36,329,941 $0 $34,350,617 $152,514 $552,740 $2,432,917 $3,150,123 $12,546,264 $0 $103,268,307 $4,521,944 $11,526,084 $5,621,407 -$8 $217,217 $0 $0 $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,835,801 $104,970,769 $35,737,939 $12,736,000 $123,932,009 $29,978 $570,387 $943,474 $130,696 $3,788,183 $5,784,000 $61,810,212 $1,915,845 $10,358,880 $10,034,034 $2,085,616 $1,206,586 $491,930 $3,661,137 90% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% STRUCTURES 80% 0% 0% 70% 20% 10% 0% 0% 0% 0% 0% 0% TREATMENT & PUMP EQUIPMENT 70% 30% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% MAINS 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 80% 20% 0% EQUIPMENT 0% 0% 0% 0% 0% 0% 40% 40% 20% 0% 0% 0% SMALL SYSTEMS 0% 0% 80% 0% 80% 0% 0% 80% 0% 0% 0% 80% 0% 0% 80% 10% 0% 0% 0% 100% 20% 0% 0% 0% 0% 0% 0% 0% 100% 100% 50% 100% 0% 100% 0% 0% 50% 0% 0% 10% 10% 10% 10% 10% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 100% 100% 0% 0% 0% 50% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 25% 0% 0% 10% 10% 10% 10% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 25% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 0% 0% 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0% 25% 0% 0% 0% 0% 0%
$229,059 $36,898 $530,071 $40,029 $250,000 $0 $3,983,144 $539,220 $2,676,792 $909,517 $784,059,197 $151,206,305
$192,160 $39,953 $152,208 $490,043 $513,264 -$23,222 $250,000 $250,000 $0 $3,443,925 $2,995,530 $448,395 $1,767,275 $54,828 $1,712,448 $632,852,892 $242,108,982 $390,743,909
January 9, 2013
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INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion SW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems Total
Secondary Treatment
Tertiary Treatment
Mains
Pump Stations
Service Laterals
Technical Services
Customer Service
Meters
Meter Reading Engineering Environmental Administration and Billing and IS Services and General
Total
$4,000,730
$1,826,464
$2,174,265
$1,863,082
$311,183
INTANGIBLE PLANT $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$311,183
$311,183
LAND $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,621,115 $165,072,997 $77,824,669 $13,721,059 $188,059,260 $215,092 $6,638,445 $4,019,931 $3,395,097 $16,758,764 $5,940,000 $212,791,989 $7,072,471 $22,813,472 $16,565,171 $9,086,148 $2,219,423 $794,109 $6,194,684 $0 $0 $0 $0 $0 $361,495 $43,269,874 $5,756,788 $985,059 $29,776,633 $32,600 $5,515,318 $643,539 $114,279 $424,317 $156,000 $47,713,471 $634,683 $928,508 $909,729 $7,000,540 $795,620 $302,179 $2,533,547 $3,624,702 $4,055,132 $148,629 $255,339 $1,501,705 $3,259,620 $121,803,123 $72,067,880 $12,736,000 $158,282,627 $182,492 $1,123,127 $3,376,391 $3,280,819 $16,334,447 $5,784,000 $165,078,519 $6,437,789 $21,884,964 $15,655,441 $2,085,607 $1,423,803 $491,930 $3,661,137 $1,108,071 $1,351,711 $90,726 $0 $915,577 $1,423,819 $16,832,353 $36,329,941 $0 $34,350,617 $152,514 $552,740 $2,432,917 $3,150,123 $12,546,264 $0 $103,268,307 $4,521,944 $11,526,084 $5,621,407 -$8 $217,217 $0 $0 $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,835,801 $104,970,769 $35,737,939 $12,736,000 $123,932,009 $29,978 $570,387 $943,474 $130,696 $3,788,183 $5,784,000 $61,810,212 $1,915,845 $10,358,880 $10,034,034 $2,085,616 $1,206,586 $491,930 $3,661,137 $2,264,968 $0 $0 $251,663 $2,703,421 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $586,128 STRUCTURES $1,468,641 $0 $0 $367,160 $73,479,539 $20,994,154 $10,497,077 $0 $0 $0 $0 $0 $0 $0 $0 $0 TREATMENT & PUMP EQUIPMENT $86,752,406 $37,179,603 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $943,474 $0 $0 $0 $0 $130,696 MAINS $0 $0 $0 $3,788,183 $0 $0 $0 $2,892,000 $0 $0 $0 $61,810,212 $0 $0 $0 $0 $0 $0 $0 $10,358,880 $8,027,227 $2,006,807 $0 $0 EQUIPMENT $0 $0 $0 $0 $0 $0 $0 $603,293 $196,772 $196,772 $98,386 $0 $0 $0 $0 $0 SMALL SYSTEMS $0 $0 $121,766 $15,221 $0 -$18,578 $0 -$2,322 $0 $0 $0 $0 $0 $0 $358,716 $44,839 $0 $0 $1,369,958 $171,245 $174,892,974 $60,358,758 $13,389,377 $81,017,198 44.76% 15.45% 3.43% 20.73% $0 $0 $57,902 $0 $0 $0 $0 $35,737,939 $0 $0 $29,978 $570,387 $0 $0 $0 $2,892,000 $0 $0 $0 $0 $0 $301,646 $0 $0 $0 $0 $0 $0 $0 $39,589,852 10.13% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,915,845 $0 $0 $0 $301,646 $0 $0 $15,221 -$2,322 $0 $44,839 $171,245 $2,446,474 0.63% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $915,284 $0 $0 $0 $0 $0 $915,284 0.23% 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $915,284 $0 $0 $0 $0 $0 $915,284 0.23% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $915,284 $0 $0 $0 $0 $0 $915,284 0.23% $0 $0 $0 $255,339 $0 $0 $0 $0 $12,736,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,085,616 $0 $0 $915,284 $0 $0 $0 $0 $0 $16,303,422 4.17% $2,516,631 $2,703,421 $57,902 $255,339 $586,128 $1,835,801 $104,970,770 $35,737,939 $12,736,000 $123,932,009 $29,978 $570,387 $943,474 $130,696 $3,788,183 $5,784,000 $61,810,212 $1,915,845 $10,358,880 $10,034,034 $2,085,616 $1,206,585 $491,930 $3,661,136 $152,208 -$23,222 $0 $448,394 $1,712,448 $390,743,907 100.00%
$229,059 $36,898 $530,071 $40,029 $250,000 $0 $3,983,144 $539,220 $2,676,792 $909,517 $784,059,197 $151,206,305
$192,160 $39,953 $152,208 $490,043 $513,264 -$23,222 $250,000 $250,000 $0 $3,443,925 $2,995,530 $448,395 $1,767,275 $54,828 $1,712,448 $632,852,892 $242,108,982 $390,743,909
January 9, 2013
Page 219
Worksheet WW-10 Cost Classification

Worksheet WW-10 details the costs as allocated to the system functions in Worksheet WW-6, WW-8 and WW-9 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Rate Design Manual. The amounts are then totaled by operation and maintenance, depreciation and are used in Worksheet WW-11 to calculate the wastewater unit rate and bill calculation. The Plant in Service functions are also totaled and the percentage by service function is used to allocate the net debt servicing costs also in Worksheet WW-11.
January 9, 2013
Page 220

Dry Weather Flow Wet Weather Flow BOD

Wastewater Collection Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total Wastewater Treatment Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total Other Operating Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total O&M Total $0 $0 $0 $3,600,786 $5,244,230 $1,661,437 $0 $0 $0 $0 $0 $0 $0 $10,506,453 37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Equivalent Meters Classification Percentages TSS 22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
Customer Service
Indirect
Dry Weather Flow
Wet Weather Flow
BOD
TSS
Equivalent Meters
Customer Service
Indirect
Total
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $3,420,747 $4,719,807 $0 $0 $0 $0 $0 $0 $0 $0
$8,140,554
$0 $0 $0 $180,039 $524,423 $0 $0 $0 $0 $0 $0 $0 $0
$704,462
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $1,661,437 $0 $0 $0 $0 $0 $0 $0
$1,661,437
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $3,600,786 $5,244,230 $1,661,437 $0 $0 $0 $0 $0 $0 $0 $10,506,453
$12,885,896 $4,195,344 $1,487,851 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,569,091
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$4,767,782 $2,307,439 $773,682 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$7,848,903
$2,448,320 $755,162 $267,813 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,471,295
$2,834,897 $461,488 $178,542 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,474,927
$2,834,897 $671,255 $267,813 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$3,773,965
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$12,885,896 $4,195,344 $1,487,850 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $18,569,090
$0 $0 $0 $0 $0 $0 $1,149,812 $753,677 $408,923 $515,431 $3,324,658 $1,374,987 $3,806,562 $11,334,050 $40,409,594
37.00% 55.00% 52.00% 95.00% 90.00% 0.00% 77.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
19.00% 18.00% 18.00% 5.00% 10.00% 0.00% 23.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 11.00% 12.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
22.00% 16.00% 18.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $0 $0 $0 $885,355 $0 $0 $0 $0 $0 $0
$885,355
$0 $0 $0 $0 $0 $0 $264,457 $0 $0 $0 $0 $0 $0
$264,457
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $408,923 $0 $0 $0 $0
$408,923
$0 $0 $0 $0 $0 $0 $0 $753,677 $0 $515,431 $0 $0 $0
$1,269,108
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $3,324,658 $1,374,987 $3,806,562

$8,506,207
$0 $0 $0 $0 $0 $0 $1,149,812 $753,677 $408,923 $515,431 $3,324,658 $1,374,987 $3,806,562 $11,334,050
$40,409,593
January 9, 2013
Page 221

Depreciation Expense by Function All Assets including Harbour

Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $5,588,631 $2,193,792 $384,278 $1,142,298 $808,797 $88,488 $0 $281,507 $0 $0 $281,507 $281,507 $897,149 $11,947,954 38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $2,123,680 $636,200 $96,070 $856,724 $606,598 $0 $0 $0 $0 $0 $0 $0 $0
$4,319,272
$670,636 $460,696 $57,642 $285,575 $202,199 $0 $0 $0 $0 $0 $0 $0 $0

$1,676,748
$1,397,158 $548,448 $115,283 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$2,060,889
$1,397,158 $548,448 $115,283 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$2,060,889
$0 $0 $0 $0 $0 $88,488 $0 $0 $0 $0 $0 $0 $0
$88,488
$0 $0 $0 $0 $0 $0 $0 $281,507 $0 $0 $0 $0 $0
$281,507
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $281,507 $281,507 $897,149

$1,460,163
$5,588,632 $2,193,792 $384,278 $1,142,299 $808,797 $88,488 $0 $281,507 $0 $0 $281,507 $281,507 $897,149 $11,947,956
Rate Base by Function All Assets including Harbour

Advanced Primary Treatment Secondary Treatment Tertiary Treatment Mains Pump Stations Service Laterals Technical Services Customer Service Meters Meter Reading and Billing Engineering and IS Environmental Services Administration and General Sub-Total $174,892,974 $60,358,758 $13,389,377 $81,017,198 $39,589,852 $2,446,474 $0 $915,284 $0 $0 $915,284 $915,284 $16,303,422 $390,743,907 38.00% 29.00% 25.00% 75.00% 75.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 12.00% 21.00% 15.00% 25.00% 25.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 25.00% 25.00% 30.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $66,459,330 $17,504,040 $3,347,344 $60,762,899 $29,692,389 $0 $0 $0 $0 $0 $0 $0 $0
$177,766,002 45.49%
$20,987,157 $12,675,339 $2,008,407 $20,254,300 $9,897,463 $0 $0 $0 $0 $0 $0 $0 $0

$65,822,666 16.85%
$43,723,244 $15,089,690 $4,016,813 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$62,829,747 16.08%
$43,723,244 $15,089,690 $4,016,813 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$62,829,747 16.08%
$0 $0 $0 $0 $0 $2,446,474 $0 $0 $0 $0 $0 $0 $0
$2,446,474 0.63%
$0 $0 $0 $0 $0 $0 $0 $915,284 $0 $0 $0 $0 $0
$915,284 0.23%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $915,284 $915,284 $16,303,422

$18,133,990 4.64%
$174,892,975 $60,358,759 $13,389,377 $81,017,199 $39,589,852 $2,446,474 $0 $915,284 $0 $0 $915,284 $915,284 $16,303,422 $390,743,910 100.00%
January 9, 2013
Page 222
Worksheet WW-11 Unit Costs and Returns
Worksheet WW-11 uses the costs from Worksheet WW-10 allocated to the system functions to calculate the unit wastewater rates for 2013/14 and 2014/15 using the billing determinates. The percentage of Dry Weather Flow, Wet Weather Flow, BOD, TSS, Equivalent Meters and Customer Service is used to allocate the indirect costs for O&M Expenses, Depreciation Expense and Debt service. Worksheet WW-11 also calculates the return on Rate Base.
January 9, 2013
Page 223


Dry Weather FlowWet Weather Flow Revenue Requirements O&M Expenses Wastewater Collection Wastewater Treatment Other Operating Sub-Total Direct Allocation Percentages O&M Expenses By Service Characteristic Depreciation Expenses All Assets including Harbour Direct Allocation Percentages Depreciation Expenses By Service Characteristic BOD TSS Equivalent Meters Customer Service Indirect 0 Total
$8,140,554 $7,848,903 $885,355 $16,874,812 52.89% $21,374,041
$704,462 $3,471,295 $264,457 $4,440,214 13.92% $5,624,081
$0 $3,474,927 $0 $3,474,927 10.89% $4,401,426
$0 $3,773,965 $0 $3,773,965 11.83% $4,780,194
$1,661,437 $0 $408,923 $2,070,360 6.49% $2,622,368
$0 $0 $1,269,108 $1,269,108 3.98% $1,607,483
$0 $0 $8,506,207 $8,506,207
$0 $0 $0 $0 0.00% $0
$10,506,453 $18,569,090 $11,334,050 $40,409,593 100.00% $40,409,593
$4,319,272 41.18%
$1,676,748 15.99%
$2,060,889 19.65%
$2,060,889 19.65%
$88,488 0.84%
$281,507 2.68%
$1,460,163
$0 0.00%
$11,947,956 100.00%
$4,920,623
$1,910,193
$2,347,816
$2,347,816
$100,808
$320,700
$0
$0
$11,947,956
Return Components Plant in Service by Serv Char Percents Debt Service ( Principal, Interest, Fees) $25,996,895 Direct Allocation Percentages Debt Service ( Principal, Interest, Fees) By Service Characteristic (Net) 45.49% $11,827,092 47.70% $12,400,519 16.85% $4,379,300 17.67% $4,593,651 16.08% $4,180,176 16.86% $4,383,076 16.08% $4,180,176 16.86% $4,383,076 0.63% $162,768 0.66% $171,580 0.23% $60,895 0.25% $64,992 4.64% $1,206,487 0.00% $0 0.00% $0 100.00% $25,996,894 100.00% $25,996,895
$38,695,183 49.39%
$12,127,925 15.48%
$11,132,318 14.21%
$11,511,086 14.69%
$2,894,756 3.69%
$1,993,175 2.54%
$0 0.00%
$78,354,444 100.00%
Less: Non-rate revenues and other adjustments ($3,807,200)

January 9, 2013
($1,880,376)
($589,355)
($541,003)
($559,278)
($140,486)
($96,703)
$0
($3,807,200)
Page 224


Dry Weather FlowWet Weather Flow BOD TSS Equivalent Meters Customer Service Indirect 0 Total
Rate Base
390,743,909
Return on Rate Base Calculated Percent Return on Rate Base
$ 22,189,695 5.68%

Alternative I&I Allocations
$36,814,807 I & I to Flow 10% $37,968,664
$11,538,570
$10,591,315
$10,951,808
$2,754,270
$1,896,472
$0
$74,547,244
I & I to Meter Equivalents I & I to Customers 45% 45% $10,591,315 $10,951,808 $7,946,626 $7,088,829 $0 $74,547,243
Billing Determinations
Residential Non-Residential Overstrength Surcharge Hauled Waste Total Billed Water Usage I & I to Flow 0.1 Rate Per Billing Unit Annual Residential
Flow
ML
BOD
kg
TSS
kg
Equivalent Meters
Annual Equivalents
Customer Service
Annual
22,713 13,803 499 77 37,091 34,477
3,861,213 2,975,393 1,262,827 19,318 8,118,751
3,861,213 4,658,871 247,779 11,591 8,779,454
76,272 26,461 0 0 102,733
76272 4767 0 0 81,039
Blended Rate - Flow & Strength Costs / Cubic Meter
$1.1013
$1.3045
$1.2474
$77.35
$87.47
$1.7261
$214
$43
$41
$77.35
$87.47
$462.82
January 9, 2013
Page 225
Worksheet WW-12 Rates, Revenues and Bills

Worksheet WW-12 uses the data from worksheet WW-11 to calculate proposed rates for Customer Charge, Base Charge and Volumetric Charges (effluent charge) for 2013/14 and 2014/15. Worksheet WW-12 also provides a revenue test based on the projected customer connections, equivalent meters and consumption and details the annual fixed charges (base and customer charge) and the annual effluent charge based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 226

I&I Allocation
Proposed Cost of Service Rates and Charges Flow / Sys Eq.

/ Customer at: 0.1 / 0.45 / 0.45
Customer Charge
$/Account $/Meter Equivalent $ / Billed Cubic Meter Billing Determinant 81,039 102,733
System Equivalents
$87.47
Base Charge
$77.35
Volumetric Charges Revenue Test Customer Charge Revenues

Number of Services
$1.73
$7,088,481 $7,946,398 $59,511,788 $74,546,667
Base Charge Revenues Volumetric Charges Revenues

34,476,961
Total Revenues
Bill Calculations

Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm Annual Effluent Charges
Capacity Ratio 1 1.5 2.5 1 1.5 2.5 5 8 16 25 50 90 150 $164.82 $203.50 $280.85 $164.82 $203.50 $280.85 $474.22 $706.27 $1,325.07 $2,021.22 $3,954.97 $7,048.97 $11,689.97
174 589 1,206 174 589 1,206 2,497 6,261 14,010 30,569 92,576 113,259 42,802
$300.83 $1,017.19 $2,081.10 $300.83 $1,017.19 $2,081.10 $4,309.37 $10,807.77 $24,182.46 $52,765.98 $159,799.17 $195,499.20 $73,881.90
Meter Size Unmetered 5/8" Unmetered 3/4" Unmetered 1" 5/8" - 15MM 3/4" - 20MM 1" - 25MM 1.5" - 40MM 2" - 50MM 3" - 80MM 4" - 100MM 6" - 150MM 8" - 200MM 10" - 250MM

174 589 1,206 174 589 1,206 2,497 6,261 14,010 30,569 92,576 113,259 42,802
$465.65 $1,220.69 $2,361.95 $465.65 $1,220.69 $2,361.95 $4,783.59 $11,514.04 $25,507.53 $54,787.20 $163,754.14 $202,548.17 $85,571.87
January 9, 2013
Page 227
Worksheet WW-13 Monthly and Quarterly Change in Wastewater Bills
Worksheet W-13 details the monthly and quarterly change in water bills for 2014/15 based on the arithmetic average of consumption by meter size.
January 9, 2013
Page 228

Worksheet WW-13
Monthly Base Charge 2013/14 Proposed Rates 2014/15 Proposed Rates
Monthly Commodity Charge 2013/14 Proposed Rates $20.33 $140.66 $20.33 $68.75 $140.66 $291.26 $730.48 $1,634.46 $3,566.37 $10,800.59 $13,213.50 $4,993.57 2014/15 Proposed Rates
Monthly Water Bill 2013/14 Proposed Rates 2014/15 Proposed Rates
Quarterly Water Bill 2013/14 Proposed Rates 2014/15 Proposed Rates
Meter Size
% Change
% Change
% Change
% Change
Unmetered 5/8" Unmetered 1" 5/8" - 15mm 3/4" - 20mm 1" - 25mm 1.5" - 40mm 2" - 50mm 3" - 80mm 4" - 100mm 6" - 150mm 8" - 200mm 10" - 250mm
14.52 100.47 14.52 49.11 100.47 208.05 521.77 1,167.47 2,547.41 7,714.70 9,438.21 3,566.83
$11.68 $20.06 $11.68 $14.47 $20.06 $34.03 $50.80 $95.51 $145.80 $285.51 $509.04 $844.34
$13.74 $23.40 $13.74 $16.96 $23.40 $39.52 $58.86 $110.42 $168.44 $329.58 $587.41 $974.16
17.6% 16.7% 17.6% 17.2% 16.7% 16.1% 15.9% 15.6% 15.5% 15.4% 15.4% 15.4%
$25.07 $173.42 $25.07 $84.76 $173.42 $359.11 $900.63 $2,015.17 $4,397.08 $13,316.35 $16,291.30 $6,156.71
23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3% 23.3%
$32.01 $38.80 $160.72 $196.83 $32.01 $38.80 $83.22 $101.72 $160.72 $196.83 $325.30 $398.63 $781.28 $959.49 $1,729.96 $2,125.59 $3,712.17 $4,565.52 $11,086.09 $13,645.93 $13,722.54 $16,878.71 $5,837.91 $7,130.88
21.2% 22.5% 21.2% 22.2% 22.5% 22.5% 22.8% 22.9% 23.0% 23.1% 23.0% 22.1%
$96.04 $482.16 $96.04 $249.67 $482.16 $975.89 $2,343.84 $5,189.88 $11,136.52 $33,258.28 $41,167.61 $17,513.73
$116.41 $590.48 $116.41 $305.17 $590.48 $1,195.88 $2,878.46 $6,376.77 $13,696.55 $40,937.79 $50,636.13 $21,392.63
21.2% 22.5% 21.2% 22.2% 22.5% 22.5% 22.8% 22.9% 23.0% 23.1% 23.0% 22.1%
January 9, 2013
Page 229
Worksheet Appendix WW-1 Additions to Utility Plant in Service

Appendix W-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2014/15. Additions to Utility Plant in Service for 2014/15 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 and 2014/15 Capital Budgets, and historical levels of contributed utility plant in service. HRWC projects addition of $41,006,000 in assets to Utility Plant in Service during the 2014/15 fiscal year.
January 9, 2013
Page 230
Appendix WW-1 Halifax Regional Water Commission Wastewater Rate Study

Additions to the Utility Plant in Service Capital Cost Contribution from Others $0
Utility Cost of Plant in Service $0
INTANGIBLE PLANT Intangible Plant TANGIBLE PLANT LAND WW Collection Land & Land Rights WW Treatment Plant Land WW Pumping Station Land WW Office Land WW Other Land STRUCTURES WW Structures Miscellaneous WW Treatment Plants WW Pumping Stations WW Office Buildings TREATMENT & PUMP EQUIPMENT WW Treatment Equipment WW Information Systems - SCADA WW Pumping Equipment Aerotech/ Airport WW System WW Manholes MAINS WW Trunk Sewers WW Force Mains WW Sewer Mains WW Sewer Laterals WW - Combined Sewers WW Portion WW Outfalls EQUIPMENT WW Transportation Equipment WW Tools & Work Equipment WW Tools & Equipment for Plant WW Computer Equipment SMALL SYSTEMS WW Fall River WW Springfield Lake WW Middle Musquodoboit WW North Preston Other Small Systems
TOTAL
$0
$0 $0 $0 $0 $0 $0 $7,000,000 $10,612,000 $0 $5,478,000 $0 $0 $0 $500,000 $2,315,000 $625,000 $9,599,000 $400,000 $0 $960,000 $804,000 $135,000 $200,000 $2,378,000 $0 $0 $0 $0 $0 $41,006,000
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $500,000 $2,165,000 $0 $2,500,000 $400,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,565,000
$0 $0 $0 $0 $0 $0 $7,000,000 $10,612,000 $0 $5,478,000 $0 $0 $0 $0 $150,000 $625,000 $7,099,000 $0 $0 $960,000 $804,000 $135,000 $200,000 $2,378,000 $0 $0 $0 $0 $0 $35,441,000
Sources of Funding
From others Capital from Operating Surplus Depreciation fund Reserve Funding Long Term Debt TOTAL $5,565,000 $0 $12,423,771 $3,320,000 $19,697,229 $41,006,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $12,423,771 $12,423,771 -$12,423,771 $0
January 9, 2013
Page 231
Worksheet Appendix WW-2 Amortization Schedule for Long Term Debt
Appendix WW-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2013/14. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Appendix WW-2
January 3, 2013

4.62% 20 $19,697,229
Total $1,894,873.43 $1,849,372.83 $1,803,872.23 $1,758,371.63 $1,712,871.03 $1,667,370.43 $1,621,869.84 $1,576,369.24 $1,530,868.64 $1,485,368.04 $1,439,867.44 $1,394,366.84 $1,348,866.24 $1,303,365.64 $1,257,865.04 $1,212,364.44 $1,166,863.85 $1,121,363.25 $1,075,862.65 $1,030,362.05
Balance $18,712,367.55 $17,727,506.10 $16,742,644.65 $15,757,783.20 $14,772,921.75 $13,788,060.30 $12,803,198.85 $11,818,337.40 $10,833,475.95 $9,848,614.50 $8,863,753.05 $7,878,891.60 $6,894,030.15 $5,909,168.70 $4,924,307.25 $3,939,445.80 $2,954,584.35 $1,969,722.90 $984,861.45 $0.00
January 9, 2013
Page 232
Stormwater Rate Study 2013/14 Appendix 3A Page 1
2013/14 HRWC Stormwater Rate Study
January 9, 2013
Page 233
Notes on Worksheet Worksheet SW-1 Statement of Operations

Worksheet SW-1 provides a comparative Statement of Operations for fiscal years ending March 31as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for stormwater service are included with Wastewater/Stormwater Services in the Audited Financial Statements (Schedule D) but can be seen separately in Appendix F of the Five Year Business Plan, on page 4 of 6. Projected results for the fiscal year April 1, 2012 to March 31, 2013 for stormwater service. Budgeted revenue and expenditures both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at the current rate structure allocated to stormwater. This worksheet details the projected deficit at the current rate allocated to stormwater service for the test years.
There was a $1.8 M loss in Stormwater Services as at March 31, 2012. A loss of $2.4 M for fiscal year 2012/13 is projected as of November 30, 2012. Based on the existing rate structure, losses of $3.6 M and $4.8 M are projected for 2013/14 and 2014/15 respectively. It is important to note that the Operating Statements and Audited Financial Statements include some accrued items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet SW-2.
January 9, 2013
Page 234
Stormwater Rate Study 2013/14 Appendix 3A Page 3 Worksheet SW-1

January 3, 2013
Halifax Regional Water Commission Stormwater Rate Study

2011/12 Actual OPERATING REVENUES Stormwater Charge Late Payment Fees Other Miscellaneous Customer Fees
2012/13 Projections
Total
OPERATING EXPENDITURES Collection Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Calculated Depreciation Rate
$5,342,580 $11,896 $74,186 $5,428,663
$5,741,155 $18,393 $143,400 $5,902,948
$5,865,122 $16,065 $93,400 $5,974,587
$5,769,664 $15,815 $93,400 $5,878,879
Total
OPERATING PROFIT (LOSS) NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt (2013/14) - Principal New Debt (2013/14) - Interest New Debt (2014/15) - Principal New Debt (2014/15) - Interest
$4,441,011 $0 $454,526 $510,343 $277,733 $593,853 $0 $6,277,466 ($848,803)
$5,183,542 $0 $571,961 $564,055 $290,411 $734,379 $0 $7,344,348 ($1,441,400)
$5,875,381 $33,528 $637,883 $612,430 $152,568 $775,504 $432,783 $8,520,077 ($2,545,490)
$5,988,347 $35,306 $680,496 $631,318 $154,216 $778,891 $594,325 $8,862,899 ($2,984,020)
Total
EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES REFUND OF AIRPORT/ AEROTECH STORMWATER REVENUE DEFICIT BEGINNING OF THE YEAR ACCUMULATED SURPLUS (DEFICIT)
$586,603 $411,872 $0 $0 $0 $0 $0 $998,474 ($1,847,277) ($86,000) $0 ($1,933,277)
$585,000 $385,846 $0 $0 $0 $0 $0 $970,846 ($2,412,246) $0 ($1,933,277) ($4,345,523)
$585,000 $355,594 $0 $79,481 $73,440 $0 $0 $1,093,515 ($3,639,005) $0 ($4,345,523) ($7,984,528)
$698,768 $458,559 $0 $158,961 $139,536 $167,467 $154,740 $1,778,031 ($4,762,051) $0 ($7,984,528) ($12,746,579)
January 9, 2013
Page 235
Worksheet SW-2 Revenue Requirements Worksheet SW-2 takes the operating and non-operating expenditure information from Worksheet SW-1 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from stormwater service customers. Additionally, adjustments are made for the stormwater portion of debt servicing payments for Eastern Passage WWTF which was pre-financed. HRWC accrues this debt servicing for accounting purposes, but will not include the debt servicing payments in the revenue requirements until the asset is in service.
January 9, 2013
Page 236
Worksheet SW-2
December 21, 2012

Test Year #1 2013/14 Budget Test Year #2 2014/15 Budget
2011/12 Actual OPERATING EXPENDITURES Collection Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Calculated Depreciation Rate
2012/13 Projections
Total
ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt (2013/14) - Principal New Debt (2013/14) - Interest New Debt (2014/15) - Principal New Debt (2014/15) - Interest
$4,441,011 $0 $454,526 $510,343 $277,733 $593,853 $6,277,466 $0 $6,277,466
$5,183,542 $0 $571,961 $564,055 $290,411 $734,379 $7,344,348 $0 $7,344,348
$5,875,381 $33,528 $637,883 $612,430 $152,568 $775,504 $8,087,294 $427,783 $8,515,077
$5,988,347 $35,306 $680,496 $631,318 $154,216 $778,132 $8,267,815 $589,325 $8,857,140
Total
LESS NON-OPERATING REVENUES Late Payment Fees Other Miscellaneous Customer Fees
$586,603 $411,872 $0 $0 $0 $0 $0 $998,474
$585,000 $385,846 $0 $0 $0 $0 $0 $970,846
$585,000 $357,011 $0 $79,481 $73,440 $0 $0 $1,094,932
$743,645 $474,130 $0 $158,961 $139,536 $167,467 $154,740 $1,838,479
Total
LESS OTHER ADJUSTMENTS Pension Adjustment (Stormwater portion 8.33%) Sponsorships and Donations (Stormwater portion 8.33%)
$11,896 $74,186 $86,083
$18,393 $143,400 $161,793
$16,065 $93,400 $109,465
$15,815 $93,400 $109,215
$53,379 $53,379
$0 $0
Total REVENUE REQUIRED FROM CUSTOMERS
$199,920 $4,548 $204,468
$199,920 $4,548 $204,468
$7,136,479
$8,153,401
$9,296,075
$10,381,936
January 9, 2013
Page 237
Worksheet SW-3 - Operating Expenditure Analysis

Worksheet SW-3 details the operating expenditures by cost element for each stormwater operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over 5% or $20,000. Total Operating Expenses were $6,277,466 for 2011/12 and are projected to be $7,344,348 or 17% $1,066,882 higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $1,175,729 or 16% over 2012/13 for a total of $8,520,077 in total Operating Expenses. Increasing depreciation accounts for 37% or $432,783 of the increase in 2013/14. The other primary drivers are salaries and benefits. Further detailed analysis is provided for each category of stormwater operating expense. Previously depreciation on Stormwater assets has not been charged to Stormwater Service as an operating expenditure. Instead, it was included with depreciation on Wastewater assets. Under the framework of a separate rate structure for Stormwater Services depreciation will now be charged to the specific service. In 2013/14, Stormwater depreciation is calculated on existing stormwater assets (separated from the wastewater assets) and new assets currently under construction or proposed under the Integrated Resource Plan (IRP). The total depreciation for 2013/14 in the amount of $432,783 consists of 53% from existing assets, 29% from current projects and 18% from new assets. The make-up of Stormwater assets is predominantly pipes (86%), however, their long useful life minimized the impact on depreciation, as only 45% of the 2013/14 Stormwater depreciation is a result of depreciation on pipes. The balance is driven by additions to shorter useful life assets, such as transportation equipment and IT. It should be noted, depreciation for 2013/14 in the amount of $432,783 appearing in Worksheet SW-3 below differs from the depreciation amount of $457,783 (including depreciation on the Regulatory Asset) shown on Worksheet SW-6, Continuity Schedule Utility Plant in Service. The difference of $25,000 relates to depreciation on transportation equipment, which is an expenditure within Fleet Services.
January 9, 2013
Page 238
Worksheet SW-3
January 3, 2013


2011/12 Actual 2012/13 Projections $0 $0 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $432,783 $594,325 ( year over year - $ and % ) 2012/13 Projections $0 0% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $432,783 0% $161,542 37%
Depreciation
$6,277,466
$7,344,348
$8,520,077
$8,862,899
$1,066,882 17%
$1,175,729 16%
$342,822 4%
January 9, 2013
Page 239
Stormwater Rate Study 2013/14 Appendix 3A Page 8 Stormwater Collection Salaries and Benefits - Are projected to increase 16% or $371k in 2013/14 compared to projected 2012/13 due two additional Combined Sewer Overflow (CSO) operators ($110 k) with the remaining increase is due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. Contract Services - Contract Services decreased by 27% or ($300k) in 2013/14 compared to projected 2012/13 due to work being taken in-house with the addition of new CCTV staff and a vehicle and the reduction of using outside contractors. Materials, Supplies and Services - Is projected to increase by 87% or $239k in 2013/14 over projected 2012/13 due to added costs for CSO and lateral work that were formerly included with Wastewater Collection, but are now included in Stormwater Collection due to the new Cost of Service Manual. Also, there are some additional costs driven by takeover of some formerly excluded HHSP assets at Pier A pump station from the contractor. Fleet Services - Is projected to increase 35% or ($319k) in 2013/14 over projected 2012/13 due to the Stormwater Collection portion of operating costs for two new vehicles, and increasing fleet unit charge rates including fuel costs. Supplementary detail for fleet costs is shown in Appendix 7. The two new vehicles are a new CCTV van, and a new vacuum truck. Fleet is operated as a separate cost center. Fleet services expenditures are budgeted to increase due to gas price increases, licensing costs, external labour rate increases, and outside heavy duty mechanic rate increases. The increase also includes a new heavy duty mechanic, a significant portion of whose hours would be charged to Fleet for Wastewater/Stormwater Collection. Allocated from WW services for combined sewers - The allocation from wastewater services for combined sewers remains the same as in previous years. The basis of allocation is 20% of 40% of the Wastewater Collection costs on the basis that 20% of the sewers are combined and 40% of the flow is stormwater (p. 20 Cost of Service Rate Design Manual). Allocated from WW services for regional administration - The administration of wastewater and stormwater collection is performed with the same supervisory structure. The allocation to stormwater is based on the proportion of direct operating cost of each function, using the 2011/12 Budget year as the base (p. 20 Cost of Service Rate Design Manual).
January 9, 2013
Page 240

Worksheet SW-3
January 3, 2013


Stormwater Collections
Salaries and Benefits $1,883,624 $2,354,270 $2,725,397 $2,796,520 $470,646 25% $0 0% $203,657 22% $0 0% ($109,430) -28% ($57) -100% $126,050 16% $0 0% ($15,639) -21% $371,127 16% $0 0% ($299,601) -27% $0 0% $238,750 87% $0 0% $319,489 35% $0 0% $6,103 10% $71,123 3% $0 0% $39,250 5% $0 0% $7,000 1% $0 0% ($15,720) -1% $0 0% $1,271 2%
$0
$0
$0
$0
Contract Services
$908,844
$1,112,501
$812,900
$852,150
Electricity
$0
$0
$0
$0
$384,430
$275,000
$513,750
$520,750
$57
$0
$0
$0
Fleet Services
$797,988
$924,038
$1,243,527
$1,227,807
Chemicals
$0
$0
$0
$0
$75,730
$60,091
$66,194
$67,465
Allocated from WW Services re: Combined Sewers
$349,492
$411,114
$455,450
$464,384
$61,622 18%
$44,336 11%
$8,934 2%
Allocated from WW Services re: Regional Administration
$40,846
$46,528
$58,163
$59,271
$5,682 14% $742,531 17%
$11,635 25% $691,839 13%
$1,108 2% $112,966 2%
Total Stormwater Collections $4,441,011
$5,183,542
$5,875,381
$5,988,347
January 9, 2013
Page 241
Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Explanations for detailed variances within Technical Services are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on data points. For additional information regarding the allocation of Technical Services (SCADA) across the Utility, refer to page 21 of the Cost of Service Rate Design Manual. The $34k increase in the Technical Services costs for Stormwater Services are due the fact that 2013/14 is the first year that Stormwater Services have SCADA costs, due to the new Cost of Service/Rate Design and the movement of CSO related costs from Wastewater Services to Stormwater Services.
Worksheet SW-3
January 3, 2013


January 9, 2013
Page 242
Stormwater Rate Study 2013/14 Appendix 3A Page 11 Engineering and IS Explanations for detailed variances within Engineering and IS are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Engineering and IS across the Utility, refer to pages 21-22 of the Cost-ofService Rate Design Manual. Amounts apportioned to Stormwater Services in 2013/14 show an increase of $66k or 12% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study.
Worksheet SW-3
January 3, 2013


2011/12 Actual 2012/13 Projections $571,961 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $637,883 $680,496 ( year over year - $ and % ) 2012/13 Projections $117,435 26% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $65,922 12% $42,613 7%
$454,526
January 9, 2013
Page 243
Environmental Services Explanations for detailed variances within Environmental Services are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on a determination of the Director of Environmental Services, based on budgeted costs and staff time employed. For additional information regarding the allocation of Environmental Services across the Utility, refer to pages 22-23 of the Cost-of-Service Rate Design Manual. Amounts apportioned to Stormwater Services in 2013/14 show an increase of $48k or 9% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study.
Worksheet SW-3
January 3, 2013


$510,343
January 9, 2013
Page 244
Stormwater Rate Study 2013/14 Appendix 3A Page 13 Customer Service Explanations for detailed variances within Customer Service are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Customer Service across the Utility, refer to page 23 of the Cost-of-Service Rate Design Manual. From an accounting perspective, common cost allocations relating to Customer Service are as referenced in the manual above, with one exception as they relate to the cost of service. Included in Water and Wastewater Services are two (2) specific system functions that are not applicable in Stormwater, namely Meters and Meter Reading/Billing. For 2013/14, under the traditional accounting allocation method Stormwater Services would have been charged $307,034 (see Water Rate Study, Worksheet W-4). A deduction of $154,466 has been applied, reducing the cost allocated to Stormwater to $152,568. Allocated Customer Service costs in Wastewater have been increased by $154,466 accordingly. It is for this reason Customer Service under Stormwater is showing such a dramatic decrease in 2013/14 compared to 2012/13 of ($137k) or (47%), as indicated in the table below. This clearly shows the changing methodology employed using the Cost of Service Manual.
Worksheet SW-3
January 3, 2013


2011/12 Actual 2012/13 Projections $290,411 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $152,568 $154,216 ( year over year - $ and % ) 2012/13 Projections $12,678 5% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget ($137,843) -47% $1,648 1%
Customer Service
$277,733
January 9, 2013
Page 245
Stormwater Rate Study 2013/14 Appendix 3A Page 14 Administration and Pension Explanations for detailed variances within Customer Service are provided in the 2013/14 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Administration and Pension across the Utility, refer to page 24 of the Cost-ofService Rate Design Manual.
Amounts apportioned to Stormwater Services in 2013/14 show an increase of $41k or 6% over 2012/13 as shown in the table below, the reasons for which are found in the notes to Worksheet W-4 in the 2013/14 Water Rate Study.
Worksheet SW-3
January 3, 2013


$593,853
January 9, 2013
Page 246
Worksheet SW-4 Cost of Service (COS) Structure

Worksheet SW-4 details the customer classifications, billing determinants, system functions with allocated percentages, service characteristics and operating and capital cost classifications for stormwater services as detailed in the cost of service manual. As noted in the Cost of Service Rate Design Manual, HRWC staff has been working to refine the data provided by the Satellite Imagery. As a result, billing determinants for total impervious area (billable), street right of way and site-generated impervious area have been updated as of November 30, 2012. In the Cost of Service Rate Design Manual on page 97, the billable impervious area is 29% Street Right of Way, and 71% Site Generated. Based on refined data as of November 30, 2012, the Street Right of Way billable impervious area is 27%, and the Site Generated is 73%. Adjustments to billable impervious area occurred due to further review of railway corridors, public and active transportation corridors, graveled areas and ownership of stormwater infrastructure within the service area.
January 9, 2013
Page 247
Worksheet SW-4
December 21, 2012
Halifax Regional Water Commission Stormwater Rate Study Stormwater Customer Classifications, Cost Functions & Service Characteristics
Street Right-of-Way Impervious Area
Billing Determinants - System Wide

Street Right-of-Way 19,438,030 Impervious Area 51,813,854
System Functions
Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General

Street Right-of-Way Flow Site Generated Flow Customer Service Indirect-General
O&M and Capital Classifications

Function 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00%
72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
January 9, 2013
Page 248
Worksheet SW-5 Operating Expense Functionalization

Worksheet SW-5 details the stormwater service operating expense categories cost elements, by the system functions detailed in the cost of service manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet SW-9 to allocate the costs to the service characteristics.
January 9, 2013
Page 249
Worksheet SW-5
January 3, 2013

Allocated Stormwater O&M Expenses 2013/14
Test Year #1 2013/14 Budget Pipes, Manholes and Retention Ponds 29% 0% 39% 0% 19% 0% 31% 0% 30% 100% 30% Combined Sewer Overflows 13% 0% 5% 0% 37% 0% 7% 0% 13% 0% 13%

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Allocated from WW Services re: Combined Sewers Allocated from WW Services re: Regional Administration 2,725,397 0 812,900 0 513,750 0 1,243,527 0 66,194 455,450 58,163 5,875,381
Ditches and Culverts 42% 0% 45% 0% 31% 0% 48% 0% 43% 0% 43%
Catchbasins 16% 0% 11% 0% 13% 0% 13% 0% 15% 0% 15%
Customer Technical Service (less Environmental Services Metering) Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Engineering Administration and IS and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Total Stormwater Collections
Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension
33,528 637,883 612,430 152,568 775,504 2,211,913 8,087,294
0% 0% 0% 0% 0%
100% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 100% 0%
0% 0% 100% 0% 0%
0% 100% 0% 0% 0%
0% 0% 0% 0% 100%
Total O&M Expense
January 9, 2013
Page 250

Test Year #1 2013/14 Budget Pipes, Manholes and Retention Ponds $801,293 $0 $317,400 $0 $99,250 $0 $382,834 $0 $20,010 $455,450 $17,582 $2,093,819 Combined Sewer Overflows $347,724 $0 $41,500 $0 $188,000 $0 $93,060 $0 $8,378 $0 $7,362 $686,024

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Allocated from WW Services re: Combined Sewers Allocated from WW Services re: Regional Administration
$0 2,725,397 0 812,900 0 513,750 0 1,243,527 0 66,194 455,450 58,163 5,875,381
Ditches and Culverts $1,132,657 $0 $362,500 $0 $157,500 $0 $601,200 $0 $28,173 $0 $24,755 $2,306,785
Catchbasins $443,723 $0 $91,500 $0 $69,000 $0 $166,433 $0 $9,633 $0 $8,464 $788,753
Customer Service (less Environmental Metering) Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering Administration and IS and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $2,725,397 $0 $812,900 $0 $513,750 $0 $1,243,527 $0 $66,194 $455,450 $58,163 $5,875,381
33,528 637,883 612,430 152,568 775,504 2,211,913 8,087,294
$0 $0 $0 $0 $0 $0 $2,093,819
$33,528 $0 $0 $0 $0 $33,528 $719,552
$0 $0 $0 $0 $0 $0 $2,306,785
$0 $0 $0 $0 $0 $0 $788,753
$0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $152,568 $0 $152,568 $152,568
$0 $0 $612,430 $0 $0 $612,430 $612,430
$0 $637,883 $0 $0 $0 $637,883 $637,883
$0 $0 $0 $0 $775,504 $775,504 $775,504
$33,528 $637,883 $612,430 $152,568 $775,504 $2,211,913 $8,087,294
Total O&M Expense
January 9, 2013
Page 251
Worksheet SW-6 Continuity Schedule Utility Plant in Service

Worksheet SW-7 provides additional detail on Funded Utility Plant in Service, Contributed Assets, Projected Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation on transportation equipment.
January 9, 2013
Page 252
Worksheet SW-6
January 3, 2013

Projected Net Book Value Depreciation before expense on Depreciation funded assets Mar-14 2013/14
Regulatory asset expense 2013/14
SW Structures SW Retention Ponds SW Gen. Structures & Improvements SW Pipes SW Stormwater Mains SW Trunk Sewers SW Culverts SW Combined Sewers - SW Portion SW Manholes and Catchbasins SW Laterals SW Equipment SW Transportation Equipment SW Information Technology SW Tools & Equipment URBAN CORE SUB-TOTAL
3,439,771 3,120,618 1,712,785 10,233,635 314,567 198,437
4,983,517 37,737 53,698,297 9,289,658 3,446,326 11,866,837 5,017,054 1,404,217
8,423,288 37,737 56,818,915 9,289,658 5,159,111 22,100,472 5,331,621 1,602,654 295,000 31,632 109,090,087
3,635,000 6,600,000 249,000 431,000 1,000,000 400,000 811,000 1,913,000 2,500,000 2,000,000 200,000 231,000 500,000
8,923,288 268,737 61,231,915 11,289,658 6,170,111 22,100,472 6,331,621 2,002,654 249,000 726,000 31,632 119,325,087
372,719 1,153 17,636,441 237,664 253,969 573,521 281,342 54,763
183,454 37,545 25,248 327,211 41,997 8,250 -
189,265 1,153 17,598,896 237,664 228,721 246,310 239,345 46,513 4,406
8,550,569 267,584 43,595,474 11,051,994 5,916,143 6,050,279 1,947,891 249,000 689,000 22,941
-
68,795 2,000 55,248 31,165 127,772 12,869 3,969 25,000 128,000 952
976 1,036 -
295,000 19,044
12,588
37,000 8,691
37,000 4,285
19,333,858
89,756,230
19,457,262
664,990
18,792,272
78,340,874
455,771
2,012
TOTAL
19,333,858
89,756,230
109,090,087
3,635,000
6,600,000
119,325,087
19,457,262
664,990
18,792,272
78,340,874
455,771
2,012
January 9, 2013
Page 253
Worksheet SW-7 Depreciation Functionalization

Worksheet SW-7 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Manual both in a percentage and dollar format. These are then used in Worksheet SW-9 to allocate depreciation to the service characteristics.
January 9, 2013
Page 254
Worksheet SW-7
Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed as a Percentage (%) 2013/14 Pipes, Manholes and Retention
Annual Depreciation Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Information and Technology SW Tools & Equipment Total
Combined Sewer Overflows
Ditches and Culverts
Catchbasins
Technical Services
Customer Service (less Metering)
Engineering and IS
Administration and General
$69,771 $2,000 $55,248 $0 $31,165 $128,808 $12,869 $3,969 $128,000 $952 $432,783
100% 100% 100% 100% 100% 0% 100% 100% 0% 70%
0% 0% 0% 0% 0% 100% 0% 0% 100% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
January 9, 2013
Page 255

Worksheet SW-7
Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed in Dollars ($) 2013/14 Pipes, Manholes and Retention Ponds
Catchbasins
Technical Services
Customer Service (less Environment Metering) al Services
Engineering and IS
Administratio n and General
Total
$69,771 $2,000 $55,248 $0 $31,165 $128,808 $12,869 $3,969 $128,000 $952 $432,783
$69,771 $2,000 $55,248 $0 $31,165 $0 $12,869 $3,969 $0 $667 $175,689 40.60%
$0 $0 $0 $0 $0 $128,808 $0 $0 $128,000 $95 $256,903 59.36%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $95 $95 0.02%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $95 $95 0.02%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$69,771 $2,000 $55,248 $0 $31,165 $128,808 $12,869 $3,969 $128,000 $952 $432,782 100.00%
January 9, 2013
Page 256
Worksheet SW-8 Allocation of Utility Plant in Service

Worksheet SW-8 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Manual both in a percentage and dollar format. These are then used in Worksheet SW-9 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 257

Worksheet SW-8
Allocation of Utility Plant in Service Functionalization of Rate Base Expressed in Dollars ($) 2013/14 Pipes, Manholes and Retention Ponds
Projected Projected Utility Accumulated Projected Net Plant in Service, Depreciation, end Book Value, end end of year of year of year
Donated or Contributed Assets
Catchbasins
Technical Services
Customer Service (less Environmental Metering) Services
Engineering and IS
Total
Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Transportation Equipment SW Information and Technology SW Tools & Equipment Total
$8,923,288 $268,737 $61,231,915 $11,289,658 $6,170,111 $22,100,472 $6,331,621 $2,002,654 $249,000 $726,000 $31,632 $119,325,087
$441,515 $3,153 $17,691,689 $237,664 $285,134 $701,293 $294,212 $58,732 $25,000 $165,000 $9,643 $19,913,033
$8,481,773 $265,584 $43,540,226 $11,051,994 $5,884,978 $21,399,179 $6,037,409 $1,943,922
$5,294,252 $36,584 $38,599,401 $11,051,994 $3,417,606 $11,620,527 $5,777,709 $1,757,703
$3,187,521 $229,000 $4,940,825 $0 $2,467,372 $9,778,652 $259,701 $186,219 $224,000 $561,000 $13,807 $21,848,097
$3,187,521 $229,000 $4,940,825 $0 $2,467,372 $0 $259,701 $186,219 $0 $0 $9,665

$11,280,303
$0 $0 $0 $0 $0 $9,778,652 $0 $0 $0 $561,000 $1,381

$10,341,033
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,381
$1,381
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,381
$1,381
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $224,000 $0 $0
$224,000
$3,187,521 $229,000 $4,940,825 $0 $2,467,372 $9,778,652 $259,701 $186,219 $224,000 $561,000 $13,808
$21,848,098
$224,000 $0 $561,000 $0 $21,989 $8,182 $99,412,054 $77,563,958
51.63%
47.33%
0.01%
0.01%
0.00%
0.00%
0.00%
0.00%
1.03%
100.00%
January 9, 2013
Page 258
Worksheet SW-9 Cost Classification

Worksheet SW-9 details the costs as allocated to the system functions in worksheet WW-5, WW-7 and WW-8 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Manual. The amounts are then totaled by operation and maintenance, depreciation and are used to calculate the stormwater unit rates for Street Right-of Way and Site Generated Flow and bill calculation (service function). The plant in service function is also totaled and the percentage by service function is used to allocate the net debt servicing costs to the rate calculation.
January 9, 2013
Page 259

Worksheet SW-9
Stormwater Cost Classification & Unit Rate Calculations 2013/14

Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total $2,093,819 $719,552 $2,306,785 $788,753 $0 $152,568 $612,430 $637,883 $775,504 $8,087,294 Street Right-of- Site Generated Customer Way Flow Flow Service Classification Percentages 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% Indirect-General Street Right-of- Site Generated Customer Way Flow Flow Service Classification Amounts $571,613 $196,438 $629,752 $788,753 $0 $0 $0 $0 $0 $2,186,556 36.00% $1,522,206 $523,114 $1,677,033 $0 $0 $0 $0 $0 $0 $3,722,353 61.00% $0 $0 $0 $0 $0 $152,568 $0 $0 $0 $152,568 3.00% Indirect-General Street Right-of- Site Generated Way Flow Flow Customer Service Total
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $0 $0 $0 $612,430 $637,883 $775,504 $2,025,817
$571,613 $196,438 $629,752 $788,753 $0 $0 $220,475 $229,638 $279,181 $2,915,850
$1,522,206 $523,114 $1,677,033 $0 $0 $0 $373,582 $389,109 $473,057 $4,958,101
$0 $0 $0 $0 $0 $152,568 $18,373 $19,136 $23,265 $213,343
$2,093,819 $719,552 $2,306,785 $788,753 $0 $152,568 $612,430 $637,883 $775,504 $8,087,294
Depreciation Expense by Function

$ 432,783 Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total 40.60% 59.36% 0.02% 0.02% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% $175,710 $256,900 $87 $87 $0 $0 $0 $0 $0 $432,784 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $47,969 $70,134 $24 $87 $0 $0 $0 $0 $0 $118,214 27.00% $127,741 $186,766 $63 $0 $0 $0 $0 $0 $0 $314,570 73.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $47,969 $70,134 $24 $87 $0 $0 $0 $0 $0 $118,214 $127,741 $186,766 $63 $0 $0 $0 $0 $0 $0 $314,570 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$175,710 $256,900 $87 $87 $0 $0 $0 $0 $0
$432,784
Debt Service Expenses by Function

$ 1,093,515 Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total 51.62% 47.33% 0.01% 0.01% 0.00% 0.00% 0.00% 0.00% 1.03% 100.00% $564,472 $517,561 $109 $109 $0 $0 $0 $0 $11,263 $1,093,514 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $154,101 $141,294 $30 $109 $0 $0 $0 $0 $0 $295,534 27.00% $410,371 $376,267 $79 $0 $0 $0 $0 $0 $0 $786,717 73.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $11,263 $11,263 $154,101 $141,294 $30 $109 $0 $0 $0 $0 $4,055 $299,589 $410,371 $376,267 $79 $0 $0 $0 $0 $0 $6,870 $793,587 $0 $0 $0 $0 $0 $0 $0 $0 $338 $338
$564,472 $517,561 $109 $109 $0 $0 $0 $0 $11,263
$1,093,514
January 9, 2013
Page 260

Worksheet SW-9

Street Right-ofWay Flow Site Generated Flow Customer Service Indirect-General Street Right-of- Site Generated Way Flow Flow Customer Service Indirect-General Street Right-of- Site Generated Way Flow Flow Customer Service Total
Return and Rate Calculations

Revenue Requirements O&M Expenses Depreciation Expenses Return Components Debt Service
Less: Non-Operating Revenues Less: Other Adjustments (Pension)
$8,087,294 $432,784 $8,520,078 $1,093,514 ($109,465) ($204,468) $779,581 $9,299,659
Street Right-ofWay Flow $2,915,850 $118,214 $3,034,064 $299,589 ($29,990) ($56,018) $213,581 $3,247,645 35.74% $119,325,087 ($19,913,033) $99,412,054 ($77,563,958) $21,848,097 3.57% $76,335
Site Generated Flow $4,958,101 $314,570 $5,272,671 $793,587 ($79,441) ($148,387) $565,759 $5,838,431
Customer Service $213,343 $0 $213,343 $338 ($34) ($63) $241 $213,583
Total $8,087,294 $432,784 $8,520,078 $1,093,514 ($109,465) ($204,468) $779,581 $9,299,659
Total Revenue Requirements
Return Calculation Projected Utility Plant in Service, end of year Projected Accumulated Depreciation, end of year Projected Net Book Value, end of year Donated or Contributed Assets Rate Base Return on Rate Base
64.26% Directly Allocated Percentages $137,249 Indirect Cost Allocation
$3,323,980
$5,975,680
$9,299,660
Billing Determinations Street Right-of-Way Impervious Area
19,438,030 51,813,854
$0.171
$0.115
January 9, 2013
Page 261
Worksheet Appendix SW-1 Additions to Utility Plant in Service

Appendix SW-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2013/14. Additions to Utility Plant in Service for 2013/14 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 Capital Budget, and historical levels of contributed utility plant in service. HRWC projects addition of $10,235,000 in assets to Utility Plant in Service during the 2013/14 fiscal year.
January 9, 2013
Page 262
Appendix SW-1
January 3, 2013

Additions to the Utility Plant in Service Capital Cost Contribution from Others
Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Transportation Equipment SW Information and Technology SW Tools & Equipment
TOTAL
$500,000 $231,000 $4,413,000 $2,000,000 $1,011,000 $0 $1,000,000 $400,000 $249,000 $431,000 $0 $10,235,000
$500,000 $0 $2,500,000 $2,000,000 $200,000 $0 $1,000,000 $400,000 $0 $0 $0 $6,600,000
$0 $231,000 $1,913,000 $0 $811,000 $0 $0 $0 $249,000 $431,000 $0 $3,635,000
Sources of Funding
From others Capital from Operating Surplus Depreciation fund Capital from Revenue Long Term Debt TOTAL $6,600,000 $0 $455,771 $0 $3,179,229 $10,235,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $455,771 $455,771 -$455,771 $0
January 9, 2013
Page 263
Worksheet Appendix SW-2 Amortization Schedule for Long Term Debt
Appendix SW-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2013/14. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Appendix SW-2
January 3, 2013

4.62% 20 $3,179,229
Total $305,841.83 $298,497.81 $291,153.79 $283,809.77 $276,465.75 $269,121.73 $261,777.72 $254,433.70 $247,089.68 $239,745.66 $232,401.64 $225,057.62 $217,713.60 $210,369.58 $203,025.56 $195,681.54 $188,337.53 $180,993.51 $173,649.49 $166,305.47
Balance $3,020,267.55 $2,861,306.10 $2,702,344.65 $2,543,383.20 $2,384,421.75 $2,225,460.30 $2,066,498.85 $1,907,537.40 $1,748,575.95 $1,589,614.50 $1,430,653.05 $1,271,691.60 $1,112,730.15 $953,768.70 $794,807.25 $635,845.80 $476,884.35 $317,922.90 $158,961.45 $0.00
January 9, 2013
Page 264
Stormwater Rate Study 2014/15 Appendix 3B Page 1
2014/15 HRWC Stormwater Rate Study
January 9, 2013
Page 265
Notes on Worksheet Worksheet SW-1 Statement of Operations

Worksheet SW-1 provides a comparative Statement of Operations for fiscal years ending March 31as follows; Actual results for the fiscal year April 1, 2011 to March 31, 2012 for stormwater service are included with Wastewater/Stormwater Services in the Audited Financial Statements (Schedule D) but can be seen separately in Appendix F of the Five Year Business Plan, on page 4 of 6. Projected results for the fiscal year April 1, 2012 to March 31, 2013 for stormwater service. Budgeted revenue and expenditures both operating and non-operating for the test years, April 1 2013 to March 31, 2014 and April 1, 2014 to March 31, 2015 at the current rate structure allocated to stormwater. This worksheet details the projected deficit at the current rate allocated to stormwater service for the test years.
There was a $1.8 M loss in Stormwater Services as at March 31, 2012. A loss of $2.4 M for fiscal year 2012/13 is projected as of November 30, 2012. Based on the existing rate structure, losses of $ 3.6 M and $4.7 M are projected for 2013/14 and 2014/15 respectively. It is important to note that the Operating Statements and Audited Financial Statements include some accrued items that are excluded from Revenue Requirements. The calculation of Revenue Requirements is shown on Worksheet SW-2.
January 9, 2013
Page 266
Worksheet SW-1
January 3, 2013

2011/12 Actual OPERATING REVENUES Stormwater Charge Late Payment Fees Other Miscellaneous Customer Fees
2012/13 Projections
Total
OPERATING EXPENDITURES Collection Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Calculated Depreciation Rate
$5,342,580 $11,896 $74,186 $5,428,663
$5,741,155 $18,393 $143,400 $5,902,948
$5,865,122 $16,065 $93,400 $5,974,587
$5,769,664 $15,815 $93,400 $5,878,879
Total
OPERATING PROFIT (LOSS) NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt (2013/14) - Principal New Debt (2013/14) - Interest New Debt (2014/15) - Principal New Debt (2014/15) - Interest
$4,441,011 $0 $454,526 $510,343 $277,733 $593,853 $0 $6,277,466 ($848,803)
$5,183,542 $0 $571,961 $564,055 $290,411 $734,379 $0 $7,344,348 ($1,441,400)
$5,875,381 $33,528 $637,883 $612,430 $152,568 $775,504 $432,783 $8,520,077 ($2,545,490)
$5,988,347 $35,306 $680,496 $631,318 $154,216 $778,891 $594,325 $8,862,899 ($2,984,020)
Total
EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES REFUND OF AIRPORT/ AEROTECH STORMWATER REVENUE DEFICIT BEGINNING OF THE YEAR ACCUMULATED SURPLUS (DEFICIT)
$586,603 $411,872 $0 $0 $0 $0 $0 $998,474 ($1,847,277) ($86,000) $0 ($1,933,277)
$585,000 $385,846 $0 $0 $0 $0 $0 $970,846 ($2,412,246) $0 ($1,933,277) ($4,345,523)
$585,000 $355,594 $0 $79,481 $73,440 $0 $0 $1,093,515 ($3,639,005) $0 ($4,345,523) ($7,984,528)
$698,768 $458,559 $0 $158,961 $139,536 $167,467 $154,740 $1,778,031 ($4,762,050) $0 ($7,984,528) ($12,746,578)
January 9, 2013
Page 267
Worksheet SW-2 Revenue Requirements Worksheet SW-2 takes the operating and non-operating expenditure information from Worksheet SW-1 to develop revenue requirements for the test years 2013/14 and 2014/15. The non-operating and other operating revenues are deducted from the expenditures to determine the revenue required from stormwater service customers. Adjustments are made for the difference in the pension & employee future benefits expense calculation per CICA section 3461 for accounting purposes, and the actual funding required per the current actuarial valuation. Additionally, adjustments are made for the stormwater portion of debt servicing payments for Eastern Passage WWTF which was pre-financed. HRWC accrues this debt servicing for accounting purposes, but will not include the debt servicing payments in the revenue requirements until the asset is in service.
January 9, 2013
Page 268
Worksheet SW-2
January 3, 2013

Test Year #1 2013/14 Budget Test Year #2 2014/15 Budget
2011/12 Actual OPERATING EXPENDITURES Collection Technical Services (SCADA) Engineering and Information Services Environmental Services Customer Service Administration and Pension Sub-total Calculated Depreciation Rate
2012/13 Projections
Total
ADD NON-OPERATING EXPENDITURES Debt Charges - Principal Debt Charges - Interest Bond Discount New Debt (2013/14) - Principal New Debt (2013/14) - Interest New Debt (2014/15) - Principal New Debt (2014/15) - Interest
$4,441,011 $0 $454,526 $510,343 $277,733 $593,853 $6,277,466 $0 $6,277,466
$5,183,542 $0 $571,961 $564,055 $290,411 $734,379 $7,344,348 $0 $7,344,348
$5,875,381 $33,528 $637,883 $612,430 $152,568 $775,504 $8,087,294 $432,783 $8,520,077
$5,988,347 $35,306 $680,496 $631,318 $154,216 $778,891 $8,268,574 $594,325 $8,862,899
Total
LESS NON-OPERATING REVENUES Late Payment Fees Other Miscellaneous Customer Fees
$586,603 $411,872 $0 $0 $0 $0 $0 $998,474
$585,000 $385,846 $0 $0 $0 $0 $0 $970,846
$585,000 $355,594 $0 $79,481 $73,440 $0 $0 $1,093,515
$698,768 $458,559 $0 $158,961 $139,536 $167,467 $154,740 $1,778,031
Total
LESS OTHER ADJUSTMENTS Pension Adjustment (Stormwater portion 8.33%) Sponsorships and Donations (Stormwater portion 8.33%)
$11,896 $74,186 $86,083
$18,393 $143,400 $161,793
$16,065 $93,400 $109,465
$15,815 $93,400 $109,215
Total REVENUE REQUIRED FROM CUSTOMERS
$53,379 $0 $53,379
$199,920 $0 $199,920
$199,920 $4,548 $204,468
$199,920 $4,548 $204,468
$7,136,479
$7,953,481
$9,299,658
$10,327,246
January 9, 2013
Page 269
Worksheet SW-3 - Operating Expenditure Analysis

Worksheet SW-3 details the operating expenditures by cost element and for each stormwater operating expense category for the 2011/12 fiscal year, the projected 2012/13 current year and the 2013/14, 2014/15 test years and compares the percentage change in each cost element over the previous year. Explanations are provided for all increases over 5% or $20,000. Total Operating Expenses were $6,277,466 for 2011/12 and are projected to be $7,344,348 or 17% $1,066,882 higher in 2012/13. Total Operating Expenses for 2013/14 are projected to increase by $1,175,729 or 16% over 2012/13 for a total of $8,520,077 in total Operating Expenses. Increasing depreciation accounts for 37% or $432,783 of the increase in 2013/14. In 2014/15 Total Operating Expenses are projected to increase by 4% or $342,822 for a total of $8,862,899. Depreciation expenses accounts for 47% or $161,542 of the increase in 2014/15. The other primary drivers are salaries and benefits. Further detailed analysis is provided for each category of stormwater operating expense. Previously depreciation on Stormwater assets has not been charged to Stormwater Service as an operating expenditure. Instead, it was included with depreciation on Wastewater assets. Under the framework of a separate rate structure for Stormwater Services depreciation will now be charged to the specific service. In 2013/14, Stormwater depreciation is calculated on existing stormwater assets (separated from the wastewater assets) and new assets currently under construction or proposed under the Integrated Resource Plan (IRP). Depreciation for 2014/15 is increasing by 37%, or $161,542. It should be noted, depreciation for 2014/15 in the amount of $594,325 appearing in Worksheet SW-3 below differs from the depreciation amount of $664,325 (including depreciation on the Regulatory Asset) shown on Worksheet SW-6, Continuity Schedule Utility Plant in Service. The difference of $70,000 relates to depreciation on transportation equipment, which is an expenditure within Fleet Services.
January 9, 2013
Page 270

Worksheet SW-3
January 3, 2013


Depreciation
$6,277,466
$7,344,348
$8,520,077
$8,862,899
$1,066,882 17%
$1,175,729 16%
$342,822 4%
January 9, 2013
Page 271
Stormwater Rate Study 2014/15 Appendix 3B Page 8 Stormwater Collection Salaries and Benefits - Are projected to increase 3% or $71k in 2014/15 compared to projected 2013/14 due to contract adjustments, a provision of a CPI based adjustment for Non-Union staff, and a provision for employees moving through salary bands. Contract Services Are projected to increase by 5% or $39k in 2014/15 compared to projected 2013/14 due to increases in some of the contractor costs. The majority of the increase $25 K pertains to projected external contractor costs for asphalt and driveway cuts, culvert installs and planned 180 km of ditching. The balance of the increase is inflationary. Allocated from WW services for combined sewers - The allocation from wastewater services for combined sewers remains the same as in previous years. The basis of allocation is 20% of 40% of the Wastewater Collection costs. 20% of sewers are combined and 40% of the flow is stormwater (p. 20 Cost of Service Rate Design Manual). Allocated from WW services for regional administration - The administration of wastewater and stormwater collection is performed with the same supervisory structure. The allocation to stormwater is based on the proportion of direct operating cost of each function using the 2011/12 Budget year as the base (p. 20 Cost of Service Rate Design Manual).
January 9, 2013
Page 272

Worksheet SW-3
January 3, 2013


Salaries and Benefits $1,883,624 $2,354,270 $2,725,397 $2,796,520 $470,646 25% $0 0% $203,657 22% $0 0% ($109,430) -28% ($57) -100% $126,050 16% $0 0% ($15,639) -21% $371,127 16% $0 0% ($299,601) -27% $0 0% $238,750 87% $0 0% $319,489 35% $0 0% $6,103 10% $71,123 3% $0 0% $39,250 5% $0 0% $7,000 1% $0 0% ($15,720) -1% $0 0% $1,271 2%
$0
$0
$0
$0
Contract Services
$908,844
$1,112,501
$812,900
$852,150
Electricity
$0
$0
$0
$0
$384,430
$275,000
$513,750
$520,750
$57
$0
$0
$0
Fleet Services
$797,988
$924,038
$1,243,527
$1,227,807
Chemicals
$0
$0
$0
$0
$75,730
$60,091
$66,194
$67,465
Allocated from WW Services re: Combined Sewers
$349,492
$411,114
$455,450
$464,384
$61,622 18%
$44,336 11%
$8,934 2%
Allocated from WW Services re: Regional Administration
$40,846
$46,528
$58,163
$59,271
$5,682 14% $742,531 17%
$11,635 25% $691,839 13%
$1,108 2% $112,966 2%
Total Stormwater Collections $4,441,011
$5,183,542
$5,875,381
$5,988,347
January 9, 2013
Page 273
Technical Services (SCADA) Technical Services provides SCADA support and enables corporate wide sharing of process related data. The Technical Services within water and wastewater and stormwater operations are consolidated under water services, but continues to support the three services. The portion allocated to wastewater and stormwater is deducted and allocated to wastewater and stormwater services. Explanations for detailed variances within Technical Services are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on data points. For additional information regarding the allocation of Technical Services (SCADA) across the Utility, refer to page 21 of the Cost of Service Rate Design Manual. In 2014/15 the Technical Services costs for Stormwater Services are projected to increase by 5% or $1,778. This is the second year that Stormwater Services have SCADA costs, due to the new Cost of Service/Rate Design and the movement of CSO related costs from Wastewater Services to Stormwater Services and is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.
Worksheet SW-3
December 21, 2012


January 9, 2013
Page 274
Stormwater Rate Study 2014/15 Appendix 3B Page 11 Engineering and IS Explanations for detailed variances within Engineering and IS are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Engineering and IS across the Utility, refer to pages 21-22 of the Cost of Service Rate Design Manual. The Stormwater Services portion of Engineering and IS costs is increasing by 7% or $43k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.
Worksheet SW-3
December 21, 2012


$454,526
January 9, 2013
Page 275
Environmental Services Explanations for detailed variances within Environmental Services are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on a determination of the Director of Environmental Services, based on budgeted costs and staff time employed. For additional information regarding the allocation of Environmental Services across the Utility, refer to pages 22-23 of the Cost of Service Rate Design Manual. The Stormwater Services portion of Environmental Services is increasing by 3% or $19k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.
Worksheet SW-3
December 21, 2012


$510,343
January 9, 2013
Page 276
Stormwater Rate Study 2014/15 Appendix 3B Page 13 Customer Service Explanations for detailed variances within Customer Service are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Customer Service across the Utility, refer to page 23 of the Cost of Service Rate Design Manual.
From an accounting perspective, common cost allocations relating to Customer Service are as referenced in the manual above, with one exception as they relate to the cost of service. Included in Water and Wastewater Services are two (2) specific system functions that are not applicable in Stormwater, namely Meters and Meter Reading/Billing. For 2014/15, under the traditional accounting allocation method Stormwater Services would have been charged $311,228 (see Water Rate Study, Worksheet W-4). A deduction of $157,012 has been applied, reducing the cost allocated to Stormwater to $154,216. Allocated Customer Service costs in Wastewater have been increased by $157,012 accordingly. It is for this reason Customer Service under Stormwater is showing such a dramatic decrease in 2013/14 compared to 2012/13 of ($137k), as indicated in the table below. This clearly shows the changing methodology employed using the Cost of Service Manual. The Stormwater Services portion of Customer Service is increasing by 1% or $2k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.
Worksheet SW-3
December 21, 2012


2011/12 Actual 2012/13 Projections $290,411 Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget $152,568 $154,216 ( year over year - $ and % ) 2012/13 Projections $12,678 5% Test Year #1 Test Year #2 2013/14 2014/15 Budget Budget ($137,843) -47% $1,648 1%
Customer Service
$277,733
January 9, 2013
Page 277
Stormwater Rate Study 2014/15 Appendix 3B Page 14 Administration and Pension Explanations for detailed variances within Customer Service are provided in the 2014/15 Water Rate Study. An analysis is provided for the department, which details cost element data and provides the allocation of costs to other services. Allocation to the various services is based on the prorated number of customers. For additional information regarding the allocation of Administration and Pension across the Utility, refer to page 24 of the Cost of Service Rate Design Manual. The Stormwater Services portion of Administration and Pension is increasing by $3k in 2014/15. The reasons for the increase are found in the notes to Worksheet W-4 in the 2014/15 Water Rate Study. The portion allocated to Wastewater Services is consistent with 2013/14 and the methodology identified in the Cost of Service Rate Design Manual.
Worksheet SW-3
January 3, 2013


$593,853
January 9, 2013
Page 278
Worksheet SW-4 Cost of Service (COS) Structure

Worksheet SW-4 details the customer classifications, billing determinants, system functions with allocated percentages, service characteristics and operating and capital cost classifications for stormwater services as detailed in the Cost of Service Rate Design Manual. As noted in the Cost of Service Rate Design Manual, HRWC staff has been working to refine the data provided by the Satellite Imagery. As a result, billing determinants for total impervious area (billable), street right of way and site-generated impervious area have been updated as of November 30, 2012. Billing determinants for 2014/15 are consistent with 2013/14. In the Cost of Service Rate Design Manual on page 97, the billable impervious area was 29% Street Right of Way, and 71% Site Generated. Based on refined data as of November 30, 2012, the Street Right of Way billable impervious area is 27%, and the Site Generated is 73%. Adjustments to billable impervious area occurred due to further review of railway corridors, public and active transportation corridors, graveled areas and ownership of stormwater infrastructure within the service area.
January 9, 2013
Page 279
Worksheet SW-4
December 21, 2012
Halifax Regional Water Commission Stormwater Rate Study Stormwater Customer Classifications, Cost Functions & Service Characteristics
Street Right-of-Way Impervious Area
Billing Determinants - System Wide

Street Right-of-Way 19,438,030 Impervious Area 51,813,854
System Functions

O&M and Capital Classifications

Function 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00%
72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00%
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
January 9, 2013
Page 280
Worksheet SW-5 Operating Expense Functionalization

Worksheet SW-5 details the stormwater service operating expense categories cost elements, by the system functions detailed in the cost of service manual. The total of the service functions equal the operating expense category in the revenue requirement in each of the test years 2013/14 and 2014/15 and are also presented in percentage format. These are then used in Worksheet SW-9 to allocate the costs to the service characteristics.
January 9, 2013
Page 281

Test Year #2 2014/15 Budget Pipes, Manholes and Retention Ponds 29% 0% 39% 0% 20% 0% 31% 0% 30% 100% 30% Combined Sewer Overflows 13% 0% 5% 0% 36% 0% 6% 0% 12% 0% 12%
Halifax Regional Water Commission Stormwater Rate Study Worksheet SW-5

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Allocated from WW Services re: Combined Sewers Allocated from WW Services re: Regional Administration 2,796,520 0 852,150 0 520,750 0 1,227,807 0 67,465 464,384 59,271 5,988,347
Ditches and Culverts 42% 0% 45% 0% 30% 0% 49% 0% 43% 0% 43%
Catchbasins 16% 0% 11% 0% 14% 0% 14% 0% 15% 0% 15%
Customer Service (less Environmental Metering) Services 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Engineering Administration and IS and General 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
35,306 680,496 631,318 154,216 778,891 2,280,227 8,268,574
0% 0% 0% 0% 0%
100% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 0% 0%
0% 0% 0% 100% 0%
0% 0% 100% 0% 0%
0% 100% 0% 0% 0%
0% 0% 0% 0% 100%
Total O&M Expense
January 9, 2013
Page 282

Test Year #2 2014/15 Budget Pipes, Manholes and Retention Ponds $822,400 $0 $331,650 $0 $102,250 $0 $382,834 $0 $20,490 $464,384 $18,001 $2,142,009 Combined Sewer Overflows $356,883 $0 $41,500 $0 $188,000 $0 $77,340 $0 $8,296 $0 $7,289 $679,308

Salaries and Benefits Training and Development Contract Services Electricity Materials, Supplies and Services Professional Services Fleet Services Chemicals Applied Overheads and Other Allocations Allocated from WW Services re: Combined Sewers Allocated from WW Services re: Regional Administration
$0 2,796,520 0 852,150 0 520,750 0 1,227,807 0 67,465 464,384 59,271 5,988,347
Ditches and Culverts $1,161,827 $0 $387,500 $0 $157,500 $0 $601,200 $0 $28,850 $0 $25,346 $2,362,223
Catchbasins $455,410 $0 $91,500 $0 $73,000 $0 $166,433 $0 $9,829 $0 $8,635 $804,807
Customer Service (less Environmental Metering) Services $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Engineering Administration and IS and General $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total $2,796,520 $0 $852,150 $0 $520,750 $0 $1,227,807 $0 $67,465 $464,384 $59,271 $5,988,347
35,306 680,496 631,318 154,216 778,891 2,280,227 8,268,574
$0 $0 $0 $0 $0 $0 $2,142,009
$35,306 $0 $0 $0 $0 $35,306 $714,614
$0 $0 $0 $0 $0 $0 $2,362,223
$0 $0 $0 $0 $0 $0 $804,807
$0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $154,216 $0 $154,216 $154,216
$0 $0 $631,318 $0 $0 $631,318 $631,318
$0 $680,496 $0 $0 $0 $680,496 $680,496
$0 $0 $0 $0 $778,891 $778,891 $778,891
$35,306 $680,496 $631,318 $154,216 $778,891 $2,280,227 $8,268,574
Total O&M Expense
January 9, 2013
Page 283
Worksheet SW-6 Continuity Schedule Utility Plant in Service

Worksheet SW-7 provides additional detail on Funded Utility Plant in Service, Contributed Assets, and Projected Utility Plant in Service Additions, Projected Retirements, Accumulated Depreciation, and Projected Net Book Value before Depreciation, and Calculated Depreciation including Retirements for the test years. The spreadsheet is broken down by asset, class and the opening balance is reconciled with Utility Plant in Service as per the March 31, 2012 Audited Financial Statements, which are included as Appendix 5 of this Application. Please note this worksheet includes calculated depreciation on transportation equipment.
January 9, 2013
Page 284

Stormwater Rate Study
Worksheet SW-6
Projected Net Book Value Depreciation before expense on Depreciation funded assets Mar-15 2014/15
Regulatory asset expense 2014/15
SW Structures SW Retention Ponds SW Gen. Structures & Improvements SW Pipes SW Stormwater Mains SW Trunk Sewers SW Culverts SW Combined Sewers - SW Portion SW Manholes and Catchbasins SW Laterals SW Equipment SW Transportation Equipment SW Information Technology SW Tools & Equipment URBAN CORE SUB-TOTAL
3,439,771 231,000 5,033,618 2,523,785 10,233,635 314,567 198,437
5,483,517 37,737 56,198,297 11,289,658 3,646,326 11,866,837 6,017,054 1,804,217
8,923,288 268,737 61,231,915 11,289,658 6,170,111 22,100,472 6,331,621 2,002,654 249,000 726,000 31,632 119,325,087
7,361,000 6,600,000 201,000 331,000 1,000,000 400,000 825,000 5,429,000 2,500,000 2,000,000 200,000 575,000 500,000
9,423,288 843,737 69,160,915 13,289,658 7,195,111 22,100,472 7,331,621 2,402,654 450,000 1,057,000 31,632 133,286,087
497,803 3,656 18,377,123 334,931 365,839 795,736 395,920 78,816
252,250 2,000 92,793 56,413 454,983 54,866 12,219 -
245,553 1,656 18,284,330 334,931 309,426 340,753 341,054 66,598 5,664
8,925,485 840,081 50,783,792 12,954,727 6,829,272 6,935,701 2,323,837 425,000 892,000 20,730
-
68,795 10,000 103,248 42,165 127,772 12,869 3,511 70,000 223,000 952
976 1,036 -
249,000 726,000 19,044
12,588
25,000 165,000 10,902
25,000 165,000 5,237
22,968,858
96,356,230
21,050,727
1,120,761
19,929,965
90,930,624
662,313
2,012
TOTAL
22,968,858
96,356,230
119,325,087
7,361,000
6,600,000
133,286,087
21,050,727
1,120,761
19,929,965
90,930,624
662,313
2,012
January 9, 2013
Page 285
Worksheet SW-7 Depreciation Functionalization

Worksheet SW-7 allocates the projected annual depreciation charge included in the revenue requirement for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Rate Design Manual both in a percentage and dollar format. These are then used in Worksheet SW-9 to allocate depreciation to the service characteristics.
January 9, 2013
Page 286
Worksheet SW-7
Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed as a Percentage (%) 2014/15 Pipes, Manholes and Retention
Catchbasins
Technical Services
Engineering and IS
$69,771 $10,000 $103,248 $0 $42,165 $128,808 $12,869 $3,511 $223,000 $952 $594,325
100% 100% 100% 100% 100% 0% 100% 100% 0% 70%
0% 0% 0% 0% 0% 100% 0% 0% 100% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
January 9, 2013
Page 287

Worksheet SW-7
Calculation of Depreciation of Tangible Plant at Total Cost Functionalization of Depreciation Expressed in Dollars ($) 2014/15 Pipes, Manholes and Retention Ponds
Catchbasins
Technical Services
Customer Service (less Environment Metering) al Services
Engineering and IS
Administratio n and General
Total
$69,771 $10,000 $103,248 $0 $42,165 $128,808 $12,869 $3,511 $223,000 $952 $594,325
$69,771 $10,000 $103,248 $0 $42,165 $0 $12,869 $3,511 $0 $667 $242,231 40.76%
$0 $0 $0 $0 $0 $128,808 $0 $0 $223,000 $95 $351,903 59.21%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $95 $95 0.02% 0.02%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $95 $95 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$69,771 $10,000 $103,248 $0 $42,165 $128,808 $12,869 $3,511 $223,000 $952 $594,324 100.01%
January 9, 2013
Page 288
Worksheet SW-8 Allocation of Utility Plant in Service

Worksheet SW-8 allocates the projected Utility Plant in Service for the test years 2013/14 and 2014/15 to the system functions based on their in service use as detailed in the Cost of Service Manual both in a percentage and dollar format. These are then used in Worksheet SW-9 to allocate debt servicing costs to the service characteristics.
January 9, 2013
Page 289
Worksheet SW-8
Allocation of Utility Plant in Service Functionalization of the Rate Base Expressed as a Percentage (%) 2014/15 Pipes, Manholes and Retention Ponds
Contributed Projected Projected Net Plant, excluded Projected Utility Accumulated from Rate Plant in Service, Depreciation, end Book Value, Rate Base end of year of year (Col D - Col E) end of year Base
Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Transportation Equipment SW Information and Technology SW Tools & Equipment Total
Catchbasins
Technical Services
Engineering and IS
$9,423,288 $843,737 $69,160,915 $13,289,658 $7,195,111 $22,100,472 $7,331,621 $2,402,654 $450,000 $1,057,000 $31,632 $133,286,087
$566,599 $13,656 $18,480,371 $334,931 $408,005 $923,508 $408,789 $82,327 $95,000 $388,000 $11,854 $21,713,040
$8,856,689 $830,081 $50,680,544 $12,954,727 $6,787,107 $21,176,964 $6,922,832 $2,320,327 $355,000 $669,000 $19,778 $111,573,048
$5,737,963 $36,081 $40,413,967 $12,954,727 $3,536,900 $11,526,084 $6,676,000 $2,137,619 $0 $0 $6,923 $83,026,264
$3,118,726 $794,000 $10,266,577 $0 $3,250,207 $9,650,880 $246,832 $182,708 $355,000 $669,000 $12,855 $28,546,784
100% 100% 100% 100% 100% 0% 100% 100% 0% 0% 70%
0% 0% 0% 0% 0% 100% 0% 0% 0% 100% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 10%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0% 0% 100% 0% 0%
January 9, 2013
Page 290

Worksheet SW-8
Allocation of Utility Plant in Service Functionalization of Rate Base Expressed in Dollars ($) 2014/15 Pipes, Manholes and Retention Ponds
Projected Projected Net Projected Utility Accumulated Plant in Service, Depreciation, end Book Value, end of year of year end of year Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Transportation Equipment SW Information and Technology SW Tools & Equipment Total
Contributed Plant, excluded from Rate Rate Base (Col D - Col E) Base
Catchbasins
Technical Services
Customer Service (less Environmental Metering) Services
Engineering and IS
Total
$9,423,288 $843,737 $69,160,915 $13,289,658 $7,195,111 $22,100,472 $7,331,621 $2,402,654 $450,000 $1,057,000 $31,632 $133,286,087
$566,599 $13,656 $18,480,371 $334,931 $408,005 $923,508 $408,789 $82,327 $95,000 $388,000 $11,854 $21,713,040
$8,856,689 $830,081 $50,680,544 $12,954,727 $6,787,107 $21,176,964 $6,922,832 $2,320,327 $355,000 $669,000 $19,778 $111,573,048
$5,737,963 $36,081 $40,413,967 $12,954,727 $3,536,900 $11,526,084 $6,676,000 $2,137,619 $0 $0 $6,923 $83,026,264
$3,118,726 $794,000 $10,266,577 $0 $3,250,207 $9,650,880 $246,832 $182,708 $355,000 $669,000 $12,855 $28,546,784
$3,118,726 $794,000 $10,266,577 $0 $3,250,207 $0 $246,832 $182,708 $0 $0 $8,998

$17,868,048
$0 $0 $0 $0 $0 $9,650,880 $0 $0 $0 $669,000 $1,285

$10,321,165
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,285
$1,285
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,285
$1,285
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
$0 $0 $0 $0 $0 $0 $0 $0 $355,000 $0 $0
$355,000
$3,118,726 $794,000 $10,266,577 $0 $3,250,207 $9,650,880 $246,832 $182,708 $355,000 $669,000 $12,853
$28,546,783
62.59%
36.16%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
1.24%
100.00%
January 9, 2013
Page 291
Worksheet SW-9 Cost Classification

Worksheet SW-9 details the costs as allocated to the system functions in worksheet WW-5, WW-7 and WW-8 and allocates them to the service characteristics based on the percentages for each characteristic detailed in the Cost of Service Manual. The amounts are then totaled by operation and maintenance, depreciation and are used to calculate the stormwater unit rates for Street Right-of Way and Site Generated Flow and bill calculation (service function). The plant in service function is also totaled and the percentage by service function is used to allocate the net debt servicing costs to the rate calculation.
January 9, 2013
Page 292

Worksheet SW-9

Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total $2,142,009 $714,614 $2,362,223 $804,807 $0 $154,216 $631,318 $680,496 $778,891 $8,268,574 Street Right-of- Site Generated Customer Way Flow Flow Service Classification Percentages 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% Indirect-General Street Right-of- Site Generated Customer Way Flow Flow Service Classification Amounts $584,768 $195,090 $644,887 $804,807 $0 $0 $0 $0 $0 $2,229,552 36.00% $1,557,240 $519,524 $1,717,336 $0 $0 $0 $0 $0 $0 $3,794,100 61.00% $0 $0 $0 $0 $0 $154,216 $0 $0 $0 $154,216 3.00% Indirect-General Street Right-of- Site Generated Way Flow Flow Customer Service Total
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00%
$0 $0 $0 $0 $0 $0 $631,318 $680,496 $778,891 $2,090,705
$584,769 $195,090 $644,887 $804,807 $0 $0 $227,274 $244,979 $280,401 $2,982,207
$1,557,240 $519,524 $1,717,336 $0 $0 $0 $385,104 $415,103 $475,124 $5,069,430
$0 $0 $0 $0 $0 $154,216 $18,940 $20,415 $23,367 $216,937
$2,142,009 $714,614 $2,362,223 $804,807 $0 $154,216 $631,318 $680,496 $778,891 $8,268,574
Depreciation Expense by Function

$ 594,325 Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total 40.75% 59.21% 0.02% 0.02% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% $242,187 $351,900 $119 $119 $0 $0 $0 $0 $0 $594,325 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $66,117 $96,069 $32 $119 $0 $0 $0 $0 $0 $162,337 27.00% $176,070 $255,831 $87 $0 $0 $0 $0 $0 $0 $431,988 73.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $66,117 $96,069 $32 $119 $0 $0 $0 $0 $0 $162,337 $176,070 $255,831 $87 $0 $0 $0 $0 $0 $0 $431,988 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$242,187 $351,900 $119 $119 $0 $0 $0 $0 $0
$594,325
Debt Service Expenses by Function

$ 1,778,031 Pipes, Manholes and Retention Ponds Combined Sewer Overflows Ditches and Culverts Catchbasins Technical Services Customer Service (less Metering) Environmental Services Engineering and IS Administration and General Sub-Total 62.60% 36.16% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.24% 100.00% $1,113,047 $642,936 $0 $0 $0 $0 $0 $0 $22,048 $1,778,031 27.30% 27.30% 27.30% 100.00% 27.30% 0.00% 0.00% 0.00% 0.00% 72.70% 72.70% 72.70% 0.00% 72.70% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 100.00% 100.00% $303,862 $175,522 $0 $0 $0 $0 $0 $0 $0 $479,384 27.00% $809,185 $467,414 $0 $0 $0 $0 $0 $0 $0 $1,276,599 73.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $22,048 $22,048 $303,862 $175,522 $0 $0 $0 $0 $0 $0 $7,937 $487,321 $809,185 $467,414 $0 $0 $0 $0 $0 $0 $13,449 $1,290,048 $0 $0 $0 $0 $0 $0 $0 $0 $661 $661
$1,113,047 $642,936 $0 $0 $0 $0 $0 $0 $22,048
$1,778,031
January 9, 2013
Page 293

Worksheet SW-9

Street Right-of- Site Generated Customer Way Flow Flow Service Classification Percentages Indirect-General Street Right-of- Site Generated Customer Way Flow Flow Service Classification Amounts Indirect-General Street Right-of- Site Generated Way Flow Flow Customer Service Total
Return and Rate Calculations

Revenue Requirements O&M Expenses Depreciation Expenses Return Components Debt Service
Less: Non-Operating Revenues Less: Other Adjustments (Pension)
$8,268,574 $594,325 $8,862,899 $1,778,031 ($109,215) ($204,468) $1,464,348 $10,327,247
Street Right-ofWay Flow $2,982,207 $162,337 $3,144,544 $487,321 ($29,934) ($56,040) $401,347 $3,545,891 35.07% $133,286,087 ($21,713,040) $111,573,048 ($83,026,264) $28,546,784 5.13% $76,271
Site Generated Flow $5,069,430 $431,988 $5,501,418 $1,290,048 ($79,241) ($148,352) $1,062,455 $6,563,873
Customer Service $216,937 $0 $216,937 $661 ($41) ($76) $544 $217,482
Total $8,268,574 $594,325 $8,862,899 $1,778,031 ($109,216) ($204,468) $1,464,347 $10,327,246
Total Revenue Requirements
Return Calculation Projected Utility Plant in Service, end of year Projected Accumulated Depreciation, end of year Projected Net Book Value, end of year Contributed Plant, excluded from Rate Base Rate Base Return on Rate Base
64.93% Directly Allocated Percentages $141,211 Indirect Cost Allocation
$3,622,162
$6,705,084
$10,327,246
Billing Determinations Street Right-of-Way Impervious Area
19,438,030 51,813,854
$0.186
$0.129
January 9, 2013
Page 294
Worksheet Appendix SW-1 Additions to Utility Plant in Service

Appendix SW-1 details the proposed Additions to Utility Plant in Service and Capital Funding for the test year 2014/15. Additions to Utility Plant in Service for 2014/15 are estimated based on status of capital work in progress (projects approved in prior fiscal years), the projects from the 2013/14 and 2014/15 Capital Budgets, and historical levels of contributed utility plant in service. HRWC projects addition of $13,961,000 in assets to Utility Plant in Service during the 2014/15 fiscal year.
January 9, 2013
Page 295
Appendix SW-1
January 3, 2013

Additions to the Utility Plant in Service Capital Cost Contribution from Others
Stormwater Structures SW Retention Ponds SW General Structures and Improvements Stormwater Pipes SW Mains SW Trunk Sewers SW Culverts SW Combined Sewers (SW portion only) SW Manholes and Catchbasins SW Laterals Stormwater Equipment SW Transportation Equipment SW Information and Technology SW Tools & Equipment
TOTAL
$500,000 $575,000 $7,929,000 $2,000,000 $1,025,000 $0 $1,000,000 $400,000 $201,000 $331,000 $0 $13,961,000
$500,000 $0 $2,500,000 $2,000,000 $200,000 $0 $1,000,000 $400,000 $0 $0 $0 $6,600,000
$0 $575,000 $5,429,000 $0 $825,000 $0 $0 $0 $201,000 $331,000 $0 $7,361,000
Sources of Funding
From others Capital from Operating Surplus Depreciation fund Capital from Revenue Long Term Debt TOTAL $6,600,000 $0 $662,313 $0 $6,698,687 $13,961,000 Depreciation Fund Balance beginning of year Interest earned on fund balance Depreciation funded in Current year Fund Balance before expenditures Expenditure in Current Year Balance after Expenditures $0 $0 $662,313 $662,313 -$662,313 $0
January 9, 2013
Page 296
Worksheet Appendix SW-2 Amortization Schedule for Long Term Debt
Appendix SW-2 Details the Amortization Schedule of the proposed long term debt to be issued during the test years 2014/15. The amortization is based on a 20 year blended serial debenture at 4.62%, HRWCs Weighted Average Cost of Debt.
Appendix SW-2
January 3, 2013

4.62% 20 $6,698,687
Total $644,413.69 $628,939.72 $613,465.76 $597,991.79 $582,517.82 $567,043.85 $551,569.89 $536,095.92 $520,621.95 $505,147.99 $489,674.02 $474,200.05 $458,726.09 $443,252.12 $427,778.15 $412,304.18 $396,830.22 $381,356.25 $365,882.28 $350,408.32
Balance $6,363,752.65 $6,028,818.30 $5,693,883.95 $5,358,949.60 $5,024,015.25 $4,689,080.90 $4,354,146.55 $4,019,212.20 $3,684,277.85 $3,349,343.50 $3,014,409.15 $2,679,474.80 $2,344,540.45 $2,009,606.10 $1,674,671.75 $1,339,737.40 $1,004,803.05 $669,868.70 $334,934.35 $0.00
January 9, 2013
Page 297
HalifaxWater FiveYearBusinessPlan 201314to201718

ApprovedbytheHalifaxWaterBoard November29,2012
f.h.Halifax Water
Page 298
January 9, 2013
January 9, 2013
Page 299
HALIFAX WATER FiveYear Business Plan 201314 to 201718
Glossary
AM AWWA BMPs BOD5 BPF CBOD CCC CCME CCS CCTV CEU CFIA CIP COSS CSIF CSO CUPE EM EP ERA FCM GTU HIAA HHSP HRM I&I ICI IFRS IRS IS IWA JOHSC m3 MRIF NGO NSE NSERC NSPI NSUARB PI P2 RAMW RFP Asset Management American Water Works Association Best Management Practices Biochemical Oxygen Demand [5 Day Period] Biosolids Processing Facility Carbonaceous Biochemical Oxygen Demand Capital Cost Contribution Canadian Council of Ministers of the Environment Customer Care and Service Closed Circuit Television Continuing Education Unit Canadian Food Inspection Agency Capital Infrastructure Program Cost of Service Study Canada Strategic Infrastructure Fund Combined Sewer Overflow Canadian Union of Public Employees Environmental Management Environmental Protection Environmental Risk Assessment Federation of Canadian Municipalities Green Thermal Utility Halifax International Airport Authority Halifax Harbour Solutions Project Halifax Regional Municipality Inflow & Infiltration Industrial, Commercial & Institutional International Financial Reporting Standards Internal Responsibility System Information Systems International Water Association Joint Occupation Health & Safety Committee Cubic Metre Municipal Rural Infrastructure Fund NonGovernment Organization Nova Scotia Environment Natural Sciences and Engineering Research Council Nova Scotia Power Incorporated Nova Scotia Utility and Review Board Plant Information Pollution Prevention Risk Assessment Methodology for Water Request for Proposal
i
January 9, 2013
Page 300
RTU RWWFP SCADA SIR SOP SSO TRC TSS UV WEF WRF WSC WWM WWTF WQMP

Remote Terminal Unit Regional Wastewater Functional Plan. Supervisory Control and Data Acquisition Stormwater Inflow Reduction Standard Operating Procedure Sanitary Sewer Overflow Total Residual Chlorine Total Suspended Solids Ultraviolet Water Environment Federation Water Research Foundation Wastewater and Stormwater Collection Wastewater Management Wastewater Treatment Facility Water Quality Master Plan
January 9, 2013
ii
Page 301

TableofContents
Glossary .......................................................................................................................................................................... i Table of Contents ..................................................................................................................................................... iii 1. EXECUTIVE SUMMARY ................................................................................................................................. 1 2. INTRODUCTION ............................................................................................................................................... 3 3. CURRENT RATE STRUCTURES .................................................................................................................. 4 3.1 Urban Core & Satellite Systems ...................................................................................................... 4 3.2 Airport/Aerotech System ................................................................................................................. 5
4. COST OF SERVICE/RATE DESIGN ............................................................................................................ 6 5. WASTEWATER SYSTEMS EFFLUENT REGULATIONS ................................................................. 10 6. FINANCIAL PROGRAMS & PRO FORMA BUDGETS ........................................................................ 11 6.1 Capital Program ................................................................................................................................. 11 6.1.1 6.1.2 6.1.3 6.1.4 Asset Management & A Vision to Sustainable Infrastructure .................... 11 FiveYear Capital Budget General Overview ................................................. 15 . Major Projects ................................................................................................................. 16 Integrated Resource Plan .......................................................................................... 24
6.2 FiveYear Operating Budgets ....................................................................................................... 28 6.3 Debt Strategy ....................................................................................................................................... 31 6.4 Alternative Revenue Streams ...................................................................................................... 35 .
7. ENERGY MANAGEMENT ........................................................................................................................... 36 7.1 Energy Management Program ..................................................................................................... 36 7.2 RenewableEnergy Generation ................................................................................................... 38 7.2.1 Wind Energy .................................................................................................................... 38
iii
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7.2.2
Hydrokinetic Turbines ................................................................................................ 40
7.3 Energy Recovery ................................................................................................................................ 40 7.3.1 7.3.2 7.3.3 Energy from Biomass/Biosolids ............................................................................. 41 Wastewater Effluent Heat Recovery ..................................................................... 42 BioGas CHP Energy Utilization .............................................................................. 43
8. CONTINUOUS IMPROVEMENT ............................................................................................................... 43 8.1 Organizational CulturalChange Process ................................................................................ 43 8.2 Succession Planning ......................................................................................................................... 45 8.3 Water Quality Master Plan ............................................................................................................ 46 8.4 Environmental Management System ISO 14001 Expansion ...................................... 47 . 8.5 Wet Weather Flow Management ................................................................................................ 48
9. SAFETY & SECURITY .................................................................................................................................. 52 . 9.1 Corporate Security Program......................................................................................................... 52 9.2 Occupational Health & Safety Programs ................................................................................. 54
10. BUSINESS RISKS & MITIGATION STRATEGIES ............................................................................... 57 10.1 10.2 10.3 10.4 10.5 10.6 10.7 10.8 Conservation .................................................................................................................................. 57 Nova Scotia Environment [NSE] Regulatory Compliance .......................................... 58 CCME Wastewater Strategy and WSER Regulations .................................................... 59 Pension Fund Solvency ............................................................................................................. 60 . Regional Plan Update ................................................................................................................. 61 Development Pressures/Obligations .................................................................................. 63 Biosolids .......................................................................................................................................... 64 . Leachate Treatment .................................................................................................................... 66
iv
January 9, 2013
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10.9
Harbour Solutions Project Assets ......................................................................................... 68
10.10 Aerotech and Small Wastewater Treatment Facilities ................................................ 68 10.11 Energy Costs .................................................................................................................................. 72 . 10.12 External Funding .......................................................................................................................... 74
11. RECOMMENDATIONS FOR RATE APPLICATIONS ......................................................................... 75 11.1 Urban Core, Airport/Aerotech, and Satellite Systems ................................................. 75
APPENDICES A. B. C. D. E. F. G. H. I. Mission, Vision & Corporate Balanced Scorecard Organizational Chart Water and Wastewater Service Districts and Supporting Infrastructure Approved Capital Budget 201213 Projected Capital Budgets for 201314 to 201718 Projected Operating Statements Consolidated [201314 to 201718] Water Quality Master Plan Version 2 CCME Municipal Wastewater Effluent Implementation Plan Wastewater Treatment Facilities [WWTF] Compliance Plan
January 9, 2013
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1.
EXECUTIVESUMMARY
Several initiatives have just been completed that will provide a framework for longrange plans for Halifax Water: the Cost of Service/Rate Design Methodology; the Integrated Resource Plan; and the Debt Strategy. This framework will serve as a touch stone for future operating and capital budgets and rate applications as indicated in Figure 1.1. Figure1.1 BusinessPlanFramework integrated Resource Plan Operating Budgets Capital Budgets Rate Applications Cost of Debt Service/Rate Strategy Design As directed by the Nova Scotia Utility and Review Board, a Cost of Service/Rate Design hearing was held on November 21, 2011 after a settlement agreement was reached between formal interveners and Halifax Water. The NSUARB approved the settlement agreement which recognized that future rate structures should conform to best practices identified by the American Waterworks Association [AWWA] and the Water Environment Federation [WEF]. One of the related directives coming out of the NSUARB Decision was to compile a cost of service/rate design manual through a consultative process with stakeholders to serve as the basis for future rate applications. This exercise was successfully completed in 2012 and the manual was filed with the NSUARB on October 31, 2012. As part of the NSUARB Rate Decision of December 17, 2010, Halifax Water was directed to complete an Integrated Resource Plan [IRP] to guide the capital investments of the utility over the next 30 years, and to compile a Debt Strategy to ensure the most efficient approach for capital funding. After a consultative process involving stakeholders and guidance from the Tellus Institute, a consultant hired by the NSUARB, the IRP was filed with the NSUARB on October 31, 2012. The IRP projects capital expenditures of $2,579 million [NPV] over a thirty year period as follows: $1,385 million for asset renewal; $598 million for growth; and $595 million for environmental compliance. Although much of the
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funding for water projects is in place as part of the current rate structure, wastewater and stormwater projects will require significant funding increases to reach sustainable levels. The Debt Strategy indicates the utility should base an efficient capital funding structure on a maximum debt service ratio of 35% and a debt to equity ratio of 40 to 60 %. The Debt Strategy will be filed with the NSUARB in January, 2013 after Halifax Water has the opportunity to brief the Mayor of HRM, as its adoption may impact the credit rating of HRM and the Province. This fiveyear business plan is being developed to support the January 2013 rate application to cover the 2013/14 and 2014/15 fiscal years. As directed by the NSUARB, the January 2013 rate application will consider consolidation of the Urban Core/Satellite systems and the Airport/Aerotech system into one rate base, and provide information in support of a holistic asset management and financial plan for Halifax Water. Several challenges, mainly of a capital nature, will garner the attention of the utility over the next five years, namely: Impact of Significant Current and Imminent Capital Projects There is a need to accommodate new debt payments and depreciation for the Eastern Passage Wastewater Treatment Facility (WWTF), the Operations and Administration facilities at Cowie Hill, the Aerotech Wastewater Treatment Facility expansion, the Pockwock transmission main renewal along Dunbrack Street and Kearney Lake Road, and the Beechville LakesideTimberlea pipeline to transfer sewage to the Halifax sewer shed. Future Capital Demands The current water, wastewater and stormwater rates are insufficient to meet the capital needs for sustainable infrastructure as identified in the IRP. The IRP acknowledges that wastewater and stormwater assets have been grossly underfunded historically. Institutional capacity will have to increase over the term of this Business Plan in order to deliver the expected capital projects. New Environmental Regulations Increased operating expenses will be incurred by Halifax Water as it conforms to wastewater regulations recently entrenched in the federal Fisheries Act related to the CCME municipal wastewater effluent strategy Increasing Energy and Chemical Costs electricity and chemical costs will continue to increase at a rate higher than inflation Over the next five years, Halifax Water will likely file three rate applications [including the January 2013 application] for a single rate base [Urban Core/Satellite systems and Airport/Aerotech system]. Overall revenues will need to increase by 45% to 50% over the fiveyear period with the primary focus on the capital needs of wastewater and stormwater assets. Halifax Water is not alone in its quest for more sustainable funding. Unfortunately, wastewater and stormwater assets have been underfunded throughout North America, and other municipalities/utilities have made, or are making, inroads to increase rates. In Canada, the cities of Toronto and Ottawa, and EPCOR in Edmonton are well on their way to
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sustainable funding through increased rates. The projected rate increases associated with this business plan have been viewed in the context of customer affordability in relation to median household income [an industry benchmark] with proposed rates less than 2% of median household income. Where low income households experience difficulty with affordability, the utility is proposing to continue with the H20 [Help to Others] program to support these customers, with funding from unregulated activities. Some other initiatives such as the Bedford West CCC Implementation will occur within the span of the fiveyear plan and will be structured to be cost neutral to ratepayers, but there will be cash flow implications. Related to this theme will be the utilitys reliance on an expanded regional development charge to ensure that growth pays for itself. A formal review of a revised regional development charge was carried out in the fall of 2012 with completion anticipated in 2013, in conformance with a directive of the NSUARB.
2.
INTRODUCTION
In accordance with sound management principles, Halifax Water is updating its five year business plan for the 2013/14 to 2017/18 period to incorporate up to date information to guide its activities over the longterm. Recent milestones have been achieved with the completion of the Cost of Service/Rate Design Manual, Integrated Resource Plan [IRP], and related Debt Strategy to establish a framework for future infrastructure investments and rate applications. In addition, more certainty has been brought to bear with respect to regulations tied to the Canadian Council of Ministers of the Environment [CCME] municipal wastewater effluent strategy. These regulations have now been entrenched in the federal Fisheries Act and amongst other things, dictate national performance standards for the treatment of wastewater effluent. With these activities completed, longerterm projections can be made with a higher degree of confidence. In recognition that the utility inherited a significant infrastructure deficit from HRM when it assumed responsibility for wastewater and stormwater assets in 2007 and new federal regulations will create stricter environmental requirements, future rate increases are inevitable. These rate increases must be managed to balance rate shock and affordability to customers. Other infrastructure investments to facilitate growth will be managed to ensure cost neutrality to existing customers. In conformance with the Public Utilities Act, all of these collective investments and associated funding must be based on cost causation principles and occur within the context of intergenerational equity. Although the last five years were particularly challenging for Halifax Water after the integration of water, wastewater and stormwater assets in 2007, there are more challenges ahead in both the immediate and long term. The biggest challenge will be to further convince customers that protection of the environment is critical to our society, and we must continue with corrective action to not only upgrade deteriorating infrastructure and achieve compliance with regulations but mitigate and adapt to changing climatic
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conditions. Recent data indicates that climate change is accelerating as evidenced by projections of sea level rise, more intense storm events, and changing precipitation patterns. Within the last year Halifax Water received approval from the NSUARB for rate increase in both the Urban Core [including Satellite systems] and Airport/Aerotech systems based on current rate structures. With the recent completion of the Cost of Service/Rate Design Manual, Halifax Water will be submitting a rate application for the Urban Core to cover a twoyear test period based on revised rate structures which are deemed to be fair and equitable across the entire rate base. At the direction of the NSUARB, the application will also consider the integration of the Airport/Aerotech system with the Urban Core rate base. A rate application will be submitted in January of 2013 with a public hearing scheduled for April 15 to 19, 2013.
3.
CURRENTRATESTRUCTURES
Halifax Water currently has two separate rate structures as approved by the NSUARB: 1) the Urban Core and Satellite systems; and 2) the Airport/Aerotech system. In the June 28, 2012 general rate decision for the Airport/Aerotech system [NSUARBWHRWCR12[3] the NSUARB directed a Rate Application for a combined Urban Core & Airport/Aerotech System by January 31, 2013. The existing rate structures are discussed below. The proposed combined rate structure is discussed in Section 4 Cost of Service/Rate Design, and in Section 11 Recommendations for Rate Application.
3.1
UrbanCore&SatelliteSystems
The urban core and satellite systems have had one uniform rate structure for water service since May 1, 2006, when the Nova Scotia Utility and Review Board rendered a decision to harmonize the rate structure. That decision also provided for rate increases on May 1, 2006, April 1, 2007, and April 1, 2008. In March 2010, Halifax Water submitted a rate application to the NSUARB, and in December 2010, the NSUARB rendered a decision for an increase in wastewater/stormwater rates that took effect January 2011. In December 2011, Halifax Water submitted a rate application and the NSUARB approved a rate increase effective June 25, 2012. The existing rates for water service consist of a base and consumption charge. The base charge varies by meter size and ranges from $36.02 per quarter for a 15 mm [5/8] diameter residential meter to $1,558.89 per month for a 250 mm [10] commercial meter. Consumption charges are $0.509 per cubic metre [m3]. The waterrate structure also provides for a fireprotection charge that is billed annually to the Halifax Regional Municipality based on a formula approved by the NSUARB. For 2012/13, this amounts to $9,947,644.
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In 2007, wastewater and stormwater services were transferred to Halifax Water from the Halifax Regional Municipality. Associated rates previously levied by HRM were approved by the NSUARB in March 2008, which remained in place until the January 2011 rate increase. Effective June 25, 2012, these rates were increased to the current level. The current wastewater/stormwater rates, like the water rates, are uniform for the urban core and satellite systems and incorporate a base charge that varies by meter size and consumption as measured by the water meter. The current charges include a base charge that varies from $38.05 per quarter for residential customers to $1,902.93 per month for the largest commercial customers, and a discharge rate of $1.296 per m3. For unmetered customers where there is no meter to measure consumption the charge is based on the average usage for customers in a similar rate class. Approximately 0.4% of water customers are unmetered, and 1.6% of wastewater customers are unmetered. The issue of appropriateness of the rate and billing process for unmetered customers was raised as part of the Cost of Service/Rate Design hearing in November 2011. The NSUARB addressed this issue in their Order dated January 16, 2012 and confirmed that the use of averaging in the absence of meters is an accepted ratemaking practice.
3.2
Airport/AerotechSystem
The NSUARB in its previous decisions on the water and wastewater/stormwater rate applications ordered that the Airport/Aerotech water, wastewater, and stormwater systems be recognized as standalone systems and have their own rate structure. A rate application was heard by the NSUARB, and they issued their decision in November 2008 for rates effective December 1, 2008, and April 1, 2009. In March 2012 Halifax Water submitted a two year Rate Application for the Airport/Aerotech System. The Rate Hearing commenced June 6th and, at the request of HRWC, was adjourned until June 7th. This postponement enabled HRWC and the Interveners to the Application time to discuss and resolve issues in dispute with respect to the Application. On June 6, 2012, HRWC and the Interveners reached a Settlement Agreement. On June 7th the Rate Hearing reconvened and the Settlement Agreement was approved by the NSUARB, with its Order subsequently issued June 11th. Notable outcomes resulting from the Order included: HRWC was directed to file a Compliance Filing, to be submitted by June 15, 2012; HRWC was issued a revised timetable of October 31, 2012 with respect to the Cost of Service Manual, the Integrated Resource Plan and Debt Study; and
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On June 28, 2012, the NSUARB issued the decision, approving rate increase for the Airport/Aerotech system effective August 1, 2012 and April 1, 2013 respectively. The existing charges for water service vary by meter size and ranges from $25.98 per month for a 15 mm [5/8] diameter meter to $507.24 per month for a 100 mm [10] diameter meter. The consumption charge for water service is $1.629 per m3. The water rate structure also provides for a fireprotection charge based on a formula approved by the NSUARB. For 2012/13, this amounts to $141,598. The rates for wastewater services also consist of a base and consumption charge. The base charge varies by meter size and ranges from $13.28 per month for a 15 mm [5/8] diameter meter to $331.90 per month for a 100 mm [10] diameter meter. The consumption charge for wastewater service is $1.833 per m3. A separate rate for stormwater service was previously levied for customers within the Aerotech Business Park based on the calculated impervious surface area of each customers property. As of November 2011, Stormwater Services are no longer delivered to Aerotech Business Park customers by Halifax Water. In early October 2011 after inquiries from Halifax Water, Nova Scotia Transportation and Infrastructure Renewal confirmed that the stormwater assets in that area were owned by the Province. Accordingly, Halifax Water does not have a mandate to provide stormwater services in this area or the authority to levy rates or incur expenses related to stormwater for Aerotech customers. All stormwater revenues collected were subsequently fully refunded to the 13 stormwater customers of the system.
HRWC was directed to file a Rate Application on or before January 31, 2013, with consideration given to consolidating both the Urban Core and Airport/Aerotech Systems into one rate application.
4.
COSTOFSERVICE/RATEDESIGN
As part of the December 2010 rate decision, the NSUARB directed a standalone Cost of Service and Rate Design proceeding be conducted prior to the next rate application. The current NSUARB Water Utility Accounting and Reporting Handbook pertains to water utilities and does not provide guidance with respect to rate design for wastewater or stormwater. In May 2011, HWRC submitted an application for approval of a Cost of Service/Rate Design, and the hearing was held on November 21, 2011. Prior to the hearing, Halifax Water signed a settlement agreement with the Consumer Advocate and Income Property Owners Association of NS. At the hearing on November 21, 2011, Halifax Water recommended that the settlement be approved by the NSUARB. The settlement indicates that the parties accept the AWWA and WEF based methodologies for cost of service/rate
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design, however, outlines some future activities which must occur. A decision by the NSUARB was rendered on January 16, 20121 [33] The Board has considered the evidence in the proceeding, including the Settlement Agreement and submissions by the parties, and is satisfied that the Settlement Agreement is in the public interest. The Board approves the Settlement Agreement as filed. [34] HRWC, in accordance with the Settlement Agreement, and in collaboration with the Interveners, is to prepare a Cost of Service Manual which will be submitted to the Board for approval. The Board orders HRWC to complete this manual no later than August 30, 2012 and provide a schedule to achieve this deadline by January 30, 2012. HRWCs Terms of Reference for development of the CostofService [COS] Manual were approved on February 17, 2012. The timeline was altered as a result of the NSUARB Decision regarding HRWCs Airport/Aerotech Rate Application. In this decision, the NSUARB directed HRWC to submit a Rate Application for a combined Urban Core & Airport/Aerotech System by January 31, 2013. As a result of consideration of the combined Urban Core & Airport/Aerotech System, the COS Manual deadline was extended to October 31, 2012 to permit inclusion of the Airport/Aerotech system. The COS Manual was developed through a sevenstep process highlighted by engagement with interested parties, including prior rate case interveners and the NSUARB. This process is illustrated below and is aligned with the cost allocation processes outlined in industry standard manuals of practice:
1. Data Compilation
2. Kick-Off Review of standard methods
3. Budget & CIP Format, System Data
4. Cost Allocation to Functions
5. Cost Allocation to Service Characterist
6. Cost Allocation to Classes & Rate Design
7. Manual Document Review
Stakeholder consultation meetings were held on March 7th, May 9th & 10th, and September 25, 2012. Feedback from stakeholders has been accepted throughout the process, resulting in many changes and improvements in the final product. The COS Manual was filed with the NSUARB on October 31, 2012.
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The Cost of Service/Rate Design is based on American Water Works Association/Water Environment Federation best practice frameworks. The AWWA/WEF Framework achieves a substantial improvement over the existing rate structure in terms of the fairness, defensibility, and relationship to costs. Additionally, because cost allocations are tailored to reflect system characteristics, the approach is adaptable to changing circumstances. This model is more complex than the current rate design in place for HRWC, however it is appropriate given the fact that HRWCs operations are increasingly complex and a cost of service and rate design are required that can adapt in response to change, and allocate costs in a fair and equitable manner. It is important to note that when this framework is implemented a slightly higher percentage of HRWCs revenues will come from volumetric charges versus base charges. This sends a pricing signal promoting conservation of water, compliance with regulations, and operational efficiency, but places increased pressure on the utility and the NSUARB to recognize and respond to trends in declining consumption. The proposed Cost of Service/Rate Design methodology does not result in increased revenue for Halifax Water, but it does cause shifts in the rates between various types of customers and services. It is believed that the Cost of Service/Rate Design will provide a solid foundation for future rate applications. The new Cost of Service/Rate Design is based on established methodologies from the AWWA and WEF in the context of the local and operational characteristics prevalent for Halifax Water. WATER The cost of service/rate design model for water is based on the AWWA framework as it is the most defendable from the perspective of cost causation, promotes fairness and equity, is widely accepted, and will be adaptable on a goforward basis to changes in the way the utility operates. There will be a single volumetric charge for water customers based on consumption, base charge that will vary by meter size, and a customer charge that will be levied to all customers. With respect to fire protection, public fire protection costs will be recovered from HRM and private fire protection is treated as a separate and distinct additional service. Private fire protection costs are extrapolated from public fireprotection costs based on the cost of serving a single hydrant and recognition of a pipesize/capacity relationship. WASTEWATER The cost of service/rate design model for wastewater is a hybrid WEF framework with recognition and allocation of the costs of handling and treating inflow and infiltration [I&I] between the volumetric charge and the customer/base charge with 10% of the I&Irelated
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costs allocated to flow [volumetric charge], 45% to meterequivalent charge, and 45% to the customer charge.

This option produces the strongest alignment with actual cost causation and is felt to be the most fair and equitable of the models. It acknowledges that some portion of the I&I [10%] is related to faulty joints in the network including manholes, which allow flow to enter the system regardless of the number of customers connected. The second allocation of I&I to the meterequivalent charge [45%] relates to the increased water consumed [and discharged] by largerdiameter meters resulting in more flow in the wastewater system and requiring largerdiameter pipes, which increase the risk of leakage due to the increased surface area of joints in larger pipes. The final allocation to customer connections [45%] relates to leakage that is associated with connections between the service pipe and Halifax Waters collection network, and the potential for the customer to discharge other flows from sump pumps and roof drains to the system. There will be a single volumetric charge for wastewater customers for discharge, which is based on consumption, a base charge that will vary by metre size, and a customer charge that will be levied to all customers. The cost of service/ rate design also supports the continued use of an extrastrength surcharge. Under the recommended methodology for wastewater, a slightly higher portion of costs are attributed to the extrastrength surcharge than have historically been included due to the inclusion of capital and debtservicing costs. STORMWATER The cost of service rate design for stormwater is based on the principles of the AWWA/WEF framework billed as a twopart charge: a rightofway portion and a site generated portion with some exemptions and rebates to recognize properties that do not drain into Halifax Waters system. This model recognizes that roughly 29% of the stormwater originates from the street area with the remainder [71%] originating from the adjoining properties. This division has been used to calculate the portion of the costs relating to each service. Customers who discharge directly into the ocean and do not discharge into the Halifax Water system, or who can demonstrate they do not discharge into the Halifax Water system can apply for an exemption for the sitegenerated portion. The model is in keeping with the same fundamental principles and cost allocation approaches for water and wastewater. Separation of stormwater charges from wastewater charges will increase transparency with utility customers, provide more adaptability on a goforward basis, and best meet the objectives of fair and equitable cost allocations.
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5.
WASTEWATERSYSTEMSEFFLUENTREGULATIONS
The final Wastewater Systems Effluent Regulations [WSER] were released in June 2012. These regulations, made under the Fisheries Act, implement those aspects of the CCME Strategy for the Management of Municipal Wastewater Effluent which fall under federal jurisdiction, namely the discharge of deleterious substances to fish habitat. The WSER defines the following as deleterious substances, and sets national standards for their discharge: Carbonaceous Biochemical Oxygen Demand [CBOD] 25 mg/L; Total Suspended Solids [TSS] 25 mg/L; Total Residual Chlorine [TRC for those facilities using chlorine for disinfection] 0.02 mg/L; and Unionized Ammonia 1.25 mg/L as Nitrogen, at 15C 1C. Wastewater treatment facilities [WWTFs] are authorized to discharge these substances at levels below the defined limits, provided that the effluent is not acutely lethal as determined by standard toxicity testing. Facilities not in compliance must apply for a Transitional Authorization to deposit effluent exceeding those limits. The Authorization will be valid for a period of 10, 20 or 30 years, depending on the risk level associated with the effluent, as determined by a defined risk ranking system in the WSER. Wastewater treatment facilities having effluent which is acutely lethal due to Unionized Ammonia must apply for a Temporary Authorization to Deposit Unionized Ammonia. Such Authorizations are valid for three years, and may be renewed. Effluent which is acutely lethal due to substances other than Unionized Ammonia is not authorized under the WSER, and is in contravention of the Fisheries Act. Under the WSER, an Identification Report must be submitted by May 15, 2013 for each WWTF, documenting various data and information for each WWTF including the location of all overflow points. In addition, for those systems which include Combined Sewer Overflows [CSOs], a Combined Sewer Overflow Report must be submitted by Feb. 15 of each calendar year for the prior year, beginning Feb. 15 of 2014 for the 2013 calendar year. The report must document the occurrence, duration and measured or estimated volume of each CSO overflow event. Environment Canada has confirmed that hydraulic modeling results are acceptable as CSO volume estimates. The WSER also requires annual or quarterly [depending on WWTF size] Monitoring Reports for each WWTF, documenting the daily effluent volume and the concentrations of CBOD, TSS, and Unionized Ammonia. As a result of the new data management and analysis workload created by the WSER reporting requirements, Environmental Services will require an additional Data Analyst position, beginning in the 2013/14 budget year. This position has been identified in the 2013/14 budget submission.
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6. 6.1
FINANCIALPROGRAMS&PROFORMABUDGETS CapitalProgram
6.1.1 AssetManagement&AVisiontoSustainableInfrastructure
In early 2011, Halifax Water completed an Asset Management Assessment [AMA]. The outcome referred to as the Asset Management [AM] roadmap created a plan to implement AM activities in a coordinated approach. This critical step for the AM program intends to proceed with a strategy based on industry best practices with a goal of ensuring there is clear direction prior to making a significant investment [either in technology, processes, or capital versus operational spending on assets]. The AMA project included a review of current AM practices, policies, systems, tools, and data; a comparison of Halifax Waters current situation to industry best practices for AM and identification of the gaps; itemization of the steps necessary to bring Halifax Water to industry bestpractices levels; identification of the highlevel timeline and costs to achieve the recommended plan; and a report on the findings and recommendations to Halifax Water. Through a range of workshops, meetings, and interviews with staff, a number of recommendations were presented to the Executive team and ultimately to the Halifax Water Board for endorsement. These included governance changes and the AM roadmap with a series of implementation programs. The AM roadmap includes 22 initiatives to be implemented over five years at an approximate cost of $3.3 M [excluding costs associated with the GIS Data Program Implementation]. Given the focus on the Integrated Resource Plan [IRP] refer to section 6.1.4 for program details the asset management roadmap implementation was deferred to the latter quarters of the 2012/13 fiscal year. As well, the IRP identified the need for a more robust asset renewal program. Significant effort is needed to further identify asset inventories, conduct condition assessments, and prioritize asset renewal needs. An additional $3.8M over the next 3 years is identified for the asset renewal prioritization needs. Going forward, the following priorities are envisioned: Implement AM Governance Model Review and update the existing organizational design to support effective AM practices. Implement concepts and necessary changes in organization [e.g., staffing analysis, succession planning, training, and servicelevel agreements] to ensure that the right structure, number of staff, and appropriate skills/competencies are available to manage assets effectively through their lifecycle. Consider introducing corporate governance for asset management with decentralized support at the departmental level.
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Building on the work started in 201213, and in consideration of the findings from Halifax Waters initial IRP, efforts will be made to expand the original plan for the AM Governance Model. Tasks related to reviewing current staffing levels, succession planning, training, etc. that are necessary to support a range of existing and recommended programs will be carried out beyond the AM mandate. Assessing the organizational impact of the proposed wet weather planning program [including the inflow & infiltration [I/I] pilot program], expanded data collection, flow monitoring, modeling, and asset management programs, and the increase in the overall capital program will be vital to successfully implementing the recommendations of the IRP. External costs $100,000 Projected start 20122013 Quarter 4 Duration 9 months Develop a Business Process Mapping and Procedure Master Plan Document current processes and procedures, identify future needs for processes/procedures, and develop a draft prioritized plan for implementation. Develop the workflow for creation and upkeep of processes and procedures, and develop standardized templates. Establish and maintain a library of policies/procedures and standards, and deploy and control all processes and standards over the internet. Resulting from the work done on the IRP, a number of areas requiring greater attention to business process mapping were identified. This project had a late 201213 start and extends into the 201314 fiscal year. Other projects related to business process mapping are identified below for the 201314 fiscal year. External costs $50,000 Projected start 20122013 Quarter 3 Duration 24 months Develop a Technology Master Plan and Integrated Technology Solution Develop a corporatewide technology master plan with input from each of the departments with technologies to support AM requirements/improvement initiatives. Develop an overall integrated technology solution [ITS] based on the master plan using an integrated architecture to prioritize and implement interfaces on an ongoing basis. This task will be undertaken after a review by the IT Steering Committee on the need for a full master plan or an internally prepared update to the previous plan with a focus on integration opportunities and implementation of key systems. Early discussions are leaning for the need to bring in expertise to assist in coordinating an update to the previous IT master plan.
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External costs $900,000 Projected start 20122013 Quarter 3 Duration 48 months

Select and Implement Additional Core Technology Systems Develop functional and technical requirements; identify, select, and implement additional enabling core technologies to support AM requirements/improvement initiatives. First candidates for implementation include a computerized maintenance management system [CMMS], maintaining/upgrading modeling capabilities, an electronic document management system [EDMS], project management information system [PMIS], and a comprehensive asset register. Costs associated with this program are intended to cover detailed frontend planning efforts related to developing the functional and technical requirements, processes that drive the need for a particular software solution, and completing benefits analysis for each solution. Separate funding is proposed to cover specific software and implementation costs based on system priority. External costs $1,250,000 Projected start 20132014 Quarter 1 Duration 48 months

Expand & Complete Existing GIS Asset Mapping & Asset Attribute Information Expanding the existing GIS to have full coverage of all water, wastewater, and stormwater assets in terms of coverage, accuracy, and completeness of assetattribute information. This will enable enhanced data analysis and improved decisionmaking, and vastly improve the documented system knowledge. This project is being managed and funded under the GIS Data Program Implementation. This is expected to be an ongoing initiative over the next several years.

Review International Financial Reporting Standards Requirements As Halifax Water is a municipal government enterprise, it may be mandated by the Canadian Institute of Chartered Accountants [CICA] to comply with the International Financial Reporting Standards [IFRS] with a phased implementation plan. As IFRS may require that Halifax Water assets meet the financial policies for asset aggregation rather than the current practice of asset pooling, there may be an additional requirement for continuity reporting to demonstrate the clear linkage between the asset registry and the financial statements. External costs $70,000 Projected start 2013/14 Quarter 1 Duration 12 months
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Enhance Project Delivery/Management Guidelines Review current practices for project delivery process, workflow and project management guidelines and recommend updates. The objective is for processes, workflows, etc., to enable effective coordination and delivery of projects within scope, budget, and schedule, and with minimum disruption to operations. This is to be accomplished in conjunction with the implementation of a project management information system [PMIS]. This project also involves identification of project life cycle control points for the management of time, cost, and scope, developing enhanced processes for progress reporting, and development of processes for post implementation/post construction reviews. External costs $100,000 Projected start 20122013 Quarter 3 Duration 18 months Develop and Implement a Strategic Maintenance Management Program Develop a strategic approach to maintenance management that balances reactive and proactive work using bestinclass maintenance concepts and enabling technologies. This project ties well into the process mapping needed for the CMMS noted previously. External costs $100,000 Projected start 20132014 Quarter 1 Duration 21 months Asset Condition Assessments and Capital Prioritization In recognition of the need for enhanced information and data about the water, wastewater, and stormwater systems, Halifax Water intends to undertake a series of condition assessments for certain asset classes. These condition assessments will identify areas requiring asset renewal or intervention, layout a proposed program, and prioritize the sequencing of asset renewal projects by asset class. External costs $3,800,000 Projected start 20132014 Quarter 1 Duration 18 months Several of the AM roadmap priorities are multiyear programs or projects. Emphasis for the technology related projects is on the business processes needed to implement them successfully. As mentioned previously, the IRP development required a delay in
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implementing the AM roadmap. The remaining projects/initiatives identified in the AM roadmap will be programmed over the fiscal years from 20122013 to 20162017. The AM roadmap provides structure for the full implementation stage of the AM program and is essential for the programs longterm success. Together with the outcomes of the IRP, it will help guide Halifax Water in establishing an optimal level of reinvestment to ensure asset sustainability well into the future.
6.1.2 FiveYearCapitalBudgetGeneralOverview
As part of the utilitys overall mission, the annual capital budget provides funds for the acquisition, replacement, or rehabilitation of capital assets. Capital assets include all equipment; facilities; and water, wastewater, and stormwater infrastructure that have an asset value that exceeds $5,000 and a useful life that exceeds one year. The capital budget funding and subsequent project delivery help ensure that services are provided in a cost effective and efficient manner with a focus on longterm integrity of systems. As discussed in Section 6.1.1, the development of the annual and longterm capital budget has its foundation with the Engineering & IS departments core Asset Management program. This program organizes, evaluates, and prioritizes all infrastructures by individual asset class. The core assetclass priorities are reviewed and coordinated with staff from Engineering & IS and operations departments to identify the highestpriority projects. These projects are further reviewed with technical staff from the HRM Transportation and Public Works group to review integration opportunities with HRMs proposed Streets Program. A detailed overview of the major projects within the proposed fiveyear capital budget is provided in Section 6.1.3. In addition to the core infrastructure projects within the capital budget, employees from all departments define annual capitalequipment requirements to meet their operational mandates. These include equipment classes such as fleet, large tools, computer equipment, and consumption meters. The capital budget is funded from a variety of sources. The core funding is from capital asset depreciation accounts and longterm debt. This core funding is enhanced with regional development charges, external grants, and operating surplus, when available. The base funding amount for capital projects from depreciation increases on an annual basis as the underlying capitalasset value increases. The historical overall level of capital funding is well below requirements relative to current infrastructure deficiencies and projected longterm sustainable requirements. The required increase in capital infrastructure investments is defined in detail within the Integrated Resource Plan [IRP] that was filed with the NSUARB in October 2012. An overview of this plan is provided in Section 6.1.4. The proposed five year capital budget shows a transition from historical spending levels towards the level recommended within the IRP. A
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transitional period allows for the development of institutional capacity to deliver the increased volume of projects, increased funding, and enhanced Asset Management protocols to identify and prioritize specific projects. With the limited available funds for capital projects, the prioritization process focuses on projects with legal and legislative compliance issues and projects with the largest impact on maintaining defined levels of service with existing customers. The formal infrastructure projects within the capital budget are delivered by the Project Management Team within Engineering & IS. The group of project managers and their technical staff utilize a standard project management approach to consistently deliver the planning, design, construction, and commissioning phases of each project. The proposed five year capital budget for 2013/14 to 2017/18 integrates the capital requirements of the Airport/Aerotech water and wastewater system into the overall Halifax Water capital budget consistent with the proposed integration of the rate structure for the Airport/Aerotech customers into the Urban Core rate structure. The full fiveyear capital budget for the Urban Core system is shown in Appendix E. The yearone [2013/2014] budget has a total project value of $27,107,000 for water, $58,361,000 for wastewater, and $3,635,000 for stormwater, with a fiveyear total project value of $159,170,000 for water, $264,323,000 for wastewater, and $33,373,000 for stormwater. The capital budget for the Airport/Aerotech system is identified separately and also shown in Appendix E with a total project value of $28,182,000.
6.1.3 MajorProjects

Stormwater and Wastewater Projects:

Project: Kearney Lake Trunk Sewer
Asset Class: Wastewater Collection System/Structure Description: The primary wastewater infrastructure required to facilitate development of the Bedford West Subdivision area, is a trunk sewer system from Kearney Run to Kearney Lake Road and then to Highway 102 in order to convey wastewater to the Halifax sewershed. The proposed project is the first critical component of oversized infrastructure required to service Bedford West. The project includes approximately 2500m of wastewater force mains, 1200m of wastewater gravity sewers, and two large pumping stations. The design phase commenced in 2012. The design will be completed in early 2013 with construction to follow in 2013 and 2014. The estimated cost for the Kearney Lake Trunk Sewer System is $15.2 million [M]. The cost of this project will be allocated to the benefitting land owners through the Halifax Water facilitated Bedford West Capital Cost Contribution Charge which was recently approved by the NSUARB.
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Project: Jamieson Street Trunk Sewer Outfall Replacement Phase 2 Construction Asset Class: Wastewater Trunk Sewers Description: The upgrade of this combined sewer overflow [CSO] was divided into two separate phases. Phase 1 included the replacement of 300 metres of corrugated steel pipe between Windmill Road and a CSO chamber at the bottom of Jamieson Street. This phase was completed in 2007. Phase 2 includes the replacement of the remaining existing corrugated steel pipe and the extension of the CSO outfall into Halifax Harbour. The total project length is approximately 70 metres and includes a 20metre section beneath the CN rightofway, which will be cased, and a 50metre extension. It is anticipated that the pipe will be 1600 mm diameter, highdensity polyethylene. The extension of this outfall beyond the tidal zone is required to meet functional and regulatory requirements. It is noted that the permitting and regulatory approval process for Phase 2 was funded in the 2011/12 capital budget and is substantially complete. The construction is proposed for 2015/16 at a total cost of $1.1 M. Project: Northwest Arm Sewer Rehabilitation Asset Class: Wastewater Trunk Sewers Description: The 1200 mm diameter Northwest Arm trunk sewer is 4500 metres in length and was constructed in the early 1900s. It is generally located between the Northwest Arm and buildings along its eastern shore. This sewer conveys wastewater collected in the Armdale and Spryfield sewersheds to the new pumping station near the Atlantic School of Theology [AST] for further conveyance to the Halifax WWTF. A considerable length of this sewer was constructed of clay blocks that were mortared together. Replacement of this sewer using traditional openexcavation methods is not practical due to its location in narrow easements along the back of residential properties. However, further investigation revealed that this sewer is an excellent candidate for internal structural lining. This practical technology utilizes access to the pipe via existing manholes and avoids the costly and difficult excavation of traditional methods. In 2006, a condition inspection was undertaken that identified the system needed to be renewed. In 2009, a pilot project was undertaken, and 450 metres were successfully lined at a cost of $1.3 M. The remainder of the Northwest Arm trunk sewer requires rehabilitation, and to utilize internal structural lining, this work needs to be undertaken before the pipe deteriorates to a point that is not conducive to this technology. Phase 2 of the rehabilitation is planned for 2014/15 to 2016/17 at a cost of $4.4 M, with the balance to be completed after 2017/18 at an estimated cost of $11M.
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Project: Wanda Lane Sanitary Sewer Replacement Asset Class: Wastewater Collection System Description: This capital works project is an integrated project involving HRM, local residents, and Halifax Water. The proposed work scope includes street reconstruction, new sidewalk, bridge replacement on Tobin Drive, walkway bridge replacement, Ellenvale Run channel upgrades, new sanitary sewer, conversion of the old sanitary sewer to a clear water or deep storm sewer, and watermain renewal. Construction is expected to take place between 2014/15 and 2015/16 at an estimated cost of $2.2 M. Project: Bayers Lake Forcemain Upgrade and Twinning Asset Class: Wastewater Forcemains Description: The wastewater generated in Bayers Lake and Ragged Lake Business Parks is conveyed to the Halifax wastewater system via the Bayers Lake pumping station and forcemain system. This system was constructed in the mid1980s with one 300 mm diameter ductile iron forcemain. The forcemain is 1.2 km in length. The ultimate build out of this pumping station was to include the addition of a second 350 mm diameter forcemain. The increased pumping capacity and forcemain construction would be coordinated to meet actual demand from these parks. On two occasions in 2011, Halifax Water had to undertake emergency repair of the 300 mm diameter forcemain. Inspection of the removed section of pipe revealed that the pipe wall thickness at the pipe overt had been reduced to approximately 55% of its original thickness. It is believed that this is a result of hydrogen sulphide gas and that the entire pipe system is in a similar condition, and thus, pipe breaks are expected to continue. This existing forcemain either requires rehabilitation or replacement. It is now also the appropriate time to install the second forcemain to provide increased system capacity and system redundancy. The design phase is currently in progress and construction is expected to take place in 2013/14 to 2014/15 at an estimated cost of $3.16 M. Project: Lakeside Pumping Station Diversion to the Halifax Sewershed Asset Class: Wastewater Structures Description: The BeechvilleLakesideTimberlea [BLT] WWTF was commissioned in 1982, with a capacity of one million gallons per day [1 MGD] and the original intent was to increase the facilitys capacity as required to provide service to the ultimate flow generated from the lands within the prescribed boundary. The wastewater flow is now approaching the 1 MGD capacity. The BLT WWTF Environmental Risk Assessment and the BLT Area Wastewater Servicing Options Concept Development Studies were completed in 2011 and 2012 respectively. Based on the results of these studies and the Regional Wastewater Functional Plan, Halifax Water has determined that the phased diversion of wastewater
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from the BLT sewershed toward the Halifax system is the preferred approach for addressing the wastewater capacity issue in this sewershed. The design phase of the project has commenced and it is expected that construction will be undertaken in 2013 and 2014 at an estimated cost of $12M. The project scope will include the following major components: upgrade of both the Lakeside and the Bayers Lake pumping stations; the construction of approximately 3 km of forcemain system; and the upgrade of approximately 1 km of gravity sewer main system. This work will be coordinated with the Bayers Lake Forcemain Upgrade and Twinning project, noted above. Project: Russell Lake PS Upgrade Asset Class: Wastewater Structures Description: This capital works project is being funded through the CCC program for the Russell Lake West area of Dartmouth. The existing pumping station building is at the end of its service life and needs to be replaced. Included in the work scope is the installation of a backup power system and associated mechanical and electrical equipment. Construction is expected to take place in 2014/15 and 2015/16 at an estimated cost of $2 M. Project: Bedford PS Rehabilitation Asset Class: Wastewater Structures Description: The Bedford Pumping Station is located at the Mill Cove Wastewater Treatment Facility site. The station is over 40 years old, and deterioration is particularly evident within the mechanical and electrical components. The majority of the parts in service date back to the original installation. The station requires a complete rehabilitation that would include the installation of three variablefrequency drive pumps, backup power, system flow meters, an automated bar screen, and related work. Construction is expected to take place in 2015/16 and 2016/17 for a total estimated project cost of $3.5 M. Project: Eastern Passage WWTF Design Build Upgrade Asset Class: Wastewater Treatment Facility Description: The existing facility is at the end of its service life and is out of compliance on a regular basis. This capital works project involves the replacement, expansion, and upgrade of the Eastern Passage Wastewater Treatment Facility to a secondary level of treatment consistent with new CCME regulations. Construction of this $61 M project commenced in November 2011 and is expected to be complete by December 2013.
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Project: Mill Cove WWTF UV Upgrade Asset Class: Wastewater Treatment Facility Description: The UV disinfection system at Mill Cove, installed in 1996, is nearing the end of its useful life and is in need of replacement. The system is the last of its kind in North America, and it is expected that parts availability may become an issue in the coming years. Installation of a new system will help to ensure that the Mill Cove facility remains compliant on a consistent basis. Additionally, it is anticipated that significant energy savings will be realized with a new, more modern UV disinfection system. Construction is expected to take place in 2016/17 at an estimated cost of $1.075 M. Project: Belmont WWTF Decommissioning Asset Class: Wastewater Treatment Facility Description: The existing small wastewater treatment facility is at the end of its service life. This proposed capital works project involves the replacement of an existing facility with a new pumping station and forcemain. The new pumping station will transfer the flows to the newly expanded and upgraded Eastern Passage Wastewater Treatment Facility, once completed. Construction is expected to begin in 2016/17 and the total estimated project cost is estimated to be $1.9 M. Project: Aerotech WWTF Upgrade Design/Construction Asset Class: Wastewater Treatment Facility Description: The Aerotech WWTF treats wastewater from the Halifax Stanfield International Airport [HSIA], Aerotech Business Park, and from private septage haulers. The WWTF also dewaters sludge generated by wastewater treatment facilities operated by Halifax Water Sludge and septage comprise two significant side streams being treated by the WWTF, and the quality and quantity of each are quite variable. The presence of these side streams, and ongoing development within HSIA and Aerotech Park have continued to increase the loads to the WWTF. The Aerotech WWTF is experiencing difficulties in meeting the stipulated effluent discharge objectives and is near its design capacity. Further growth is projected within HSIA and Aerotech Park, and in order to accommodate the anticipated increase in wastewater, the WWTF will need upgrades to improve performance and increase capacity. Halifax Water engaged a consultant in 2011 to undertake an Environmental Risk Assessment [ERA] for the WWTF in accordance with the Canadian Council of Ministers of the Environment [CCME] Municipal Wastewater Effluent Strategy. The ERA will identify
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environmental quality objectives and performance targets that the WWTF will need to meet. The study will be completed by the end of 2012. As of October 2012, the procurement process is underway to engage a consultant to commence preliminary design activities for the Aerotech WWTF Upgrade. Completion of the preliminary design activities will provide the necessary background to advance to the detailed design and construction phases. Currently the project cost for 2013 to 2016 is estimated to be $19.75 M and construction is expected to occur in 2014/15 and 2015/16. Project: Corporate GIS Data Plan Asset Class: Water/Wastewater/Stormwater Information Technology Description: A recent strategic goal of the organization is to complete the data update in the Geographic Information System [GIS] over the next five years. This current year of this plan involves 3 projects, [1] Burnside, [2] Lakeside/Timberlea and [3] Sewer Service Lateral application. The first two projects will complete the water and sewer GIS data updating for these areas and is expected to be completed in the 3rd quarter of 2013. The 3rd project includes an application/database to house the approximately 80,000 sewer lateral records including the data entry of these records. This project is scheduled for completion by the 2nd quarter of 2014. Future data update projects will be prioritized in subsequent years.
Water Capital Projects:

Pockwock Transmission Main The Pockwock Transmission Main was commissioned in 1977 as part of the new water system to supply the City of Halifax, Town of Bedford, and western area of Halifax County. The transmission main was constructed using concrete pressure pipe and varied in size from 1,800 mm to 1,200 mm in diameter. The transmission main travels overland from the J.D. Kline Water Supply Plant to the intersection of Hammonds Plains Road and Kearney Lake Road, where it then follows Kearney Lake Road and Dunbrack Street to the Main control chamber in Fairview. The transmission main is a critical part of the water system serving the greater Halifax area. Halifax Water has experienced issues with regard to the quality of the concrete pressure pipe installed as part of this project. Over the years, there have been several catastrophic breaks that have caused significant damage to the surrounding area and a requirement to engage backup supplies from Chain Lake and Dartmouth. Various projects have been completed to mitigate the risk of further breaks. In 2001, the transmission main was twinned from the northwest end of Kearney Lake to Highway 102. In 2010, Phase I of the Dunbrack Transmission Main Sliplining Project was completed,
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which included sliplining a 1.5 km section of the transmission main with steel pipe between Highway 102 and Ross Street. In 2012, a second phase [1.6 km] of the Sliplining Project was completed on Dunbrack Street from Ross St to Lacewood Drive. Several more projects have been planned to rehabilitate the transmission main in the near future as follows: Project: Transmission Main Replacement Kearney Lake Road; Kearney Lake to Hammonds Plains Road Asset Class: Water Transmission Main Description: This project involves replacing the transmission main along the Kearney Lake Road adjacent to the future Bedford West area. This work needs to be completed prior to the start of development to reduce the risk of damage to the concrete pressure pipe as a result of blasting activities associated with site development. This work will be carried out in two phases: Kearney Lake to Bluewater Road 1730 metres, $11,700,000 Bluewater Road to Hammonds Plains Road 1630 metres, $8,000,000 The first phase, from Kearney Lake to Bluewater Road, is scheduled to be carried out in 2013/14 in conjunction with the Bedford West development timeframe. The second phase is a longerterm priority and is contingent on the buildout rate of the Bedford West development. Project: Lucasville Transmission Main Asset Class: Water Transmission Main Description: Halifax Water is working to construct a new 600 mm diameter transmission main from the Pockwock Transmission Main to the SackvilleBeaverbank area to help address emergency backup water supply capacity/redundancy. This new main would be roughly parallel to the Lucasville Road. It is anticipated that this transmission main will generally be installed through cost sharing/over sizing of mains in new development areas. The total overall cost estimate for this project is $5.9 M. Construction is expected to begin in 2014 and extend over approximately 8 years as development opportunities progress. The majority of the Lucasville Transmission Main Project is anticipated to be constructed within the timeframe of the five year business plan [2013/14 to 2017/18] and includes $1.05M in net costs for costsharing with developers in this area.
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Project: Bedford Supply Transmission Main Replacement Phase III Asset Class: Water Transmission Main Description: The project involves the replacement/rehabilitation of the existing 750mm transmission main along the Hammonds Plains Road and the Highway 102 corridor to the Meadowbrook Reservoir Control chamber. This is the primary supply main to the Bedford and Sackville areas. The existing concrete pressure pipe is under very high pressure and has had a number of leaks and failures in recent years. The consequences of failure in this area are very high. Portions of this transmission main have already been replaced as part of the recent Hammonds Plains Road widening improvements. The section of transmission to be replaced in Phase III is approximately 1000 meters long. The main to be replaced is located along Hammonds Plains Road near the signalized Hwy 102 offramp intersection and along the east side of Hwy 102 to the reservoir site. Timing for this project is anticipated to correspond with NSTIR intersection improvements within the next five years. The estimated cost of the project is approximately $2.5 M. In anticipation of this, the design work is slated to begin in the 2014/2015 budget year. Project: J.D. Kline Water Supply Plant Asset Class: Water Treatment Facilities

Description: The J.D. Kline Water Supply Plant was commissioned in 1977 to service the City of Halifax, Town of Bedford, and parts of Halifax County. Due to the age of the facility, process equipment is nearing the end of its useful life. As well, certain treatment technologies from 30 years ago no longer meet current standards. Chlorination System Replacement The existing gas chlorination system is original to the facility. It has reached the end of its useful life and needs to be replaced to ensure effective and safe operation. In March 2012, Halifax Water hired CBCL Ltd. to evaluate three different replacement chlorination options for the facility: gas chlorine, bulk delivered sodium hypochlorite and onsite generation of sodium hypochlorite. As a result of this evaluation, CBCL recommended that Halifax Water select gas chlorination as the preferred disinfection option based on capital cost, chemical cost, energy cost and familiarity with the technology. The next phase of the project will be to initiate the detailed design for a new gas chlorination system at the facility. It is estimated that design and construction of a new chlorination system will cost $925,000. Construction is anticipated to be undertaken in 2013/14.
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Flocculation Upgrades Flocculation at this plant is achieved using hydraulic mixing, where the flow gently meanders through a series of baffled basins. Through investigations, as a part of Halifax Waters research program, it was discovered that the existing flocculation basins are not adequately mixing the water. A consultants report recommended that mechanical mixers be installed in each of the 24 mixing tanks to improve the process. This project is expected to take place from 2014/15 to 2015/16 at an estimated cost of $2.55 M. Aluminum Reduction in the Process Wastewater The process wastewater at the J.D. Kline Water Supply Plant has high levels of aluminum due to the nature of the chemical used for coagulation. Process wastewater from the facility is directed to a series of lagoons behind the facility. The majority of the solids settle out while the liquid portion is discharged and flows overland to Hamilton Pond and ultimately into Little Pockwock Lake. Monitoring at the outlet of Hamilton Pond shows that aluminum levels exceed recommended guidelines and Nova Scotia Environment has requested a plan to deal with the elevated levels of aluminum. Prior to submitting a plan to Nova Scotia Environment, a conceptlevel study was undertaken, and it was determined that either an engineered wetland or mechanical separation technology would be suitable to reduce aluminum levels. A predesign study is now under way investigating these options. Based on the results of the predesign study, the best option will be selected for design and construction. It is estimated that a solution will cost $2.7 M. and the project will be undertaken in 2015/16.
6.1.4 IntegratedResourcePlan
In response to the NSUARB Decision of December 2010, Halifax Water undertook a project to develop an Integrated Resource Plan [IRP]. The IRP involved developing a comprehensive longterm planning framework and conducting scenario analysis to identify and prioritize future capital and operational programs needed to deliver water, wastewater, and stormwater services. The longterm capitalinvestment requirements also considered environmental, societal, and financial risks and constraints, and examined both supplyside and demandside management options and challenges. The IRP was completed and submitted to the NSUARB on October 31, 2012. The resulting IRP provides a longterm plan outlining the revenue requirements to support the capital investments needed and informs Halifax Water on future rate applications. The IRP focused on providing the following elements: Capital and additional O&M costs to meet the program and project requirements of the Recommended IRP for the 30year planning period from 2013 to 2043
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The IRP was a unique project for Halifax Water. It was the first longterm, comprehensive planning project undertaken by Halifax Water as a combined water, wastewater and stormwater utility. The IRP involved collaboration with the NSUARB through their external consulting team led by the Tellus Institute and it involved consultation with interested stakeholders. The Tellus team was involved directly in the process in terms of providing feedback and occasionally guidance in the preparation of the IRP. Five formal points of consultation with stakeholders were built into the project plan. As well, Halifax Waters contracted IRP consulting team led by Genivar took the initiative to meet with stakeholders one on one to identify their issues and concerns. Stakeholder consultation points [technical conferences] beyond the oneonone meetings included: Terms of Reference March 2011 Assumptions & Plan Considerations October 2011 Resource Plans & Sensitivities December 2011 Resource Plan Analysis March 2012 Presentation of Draft IRP June 2012 The IRP was developed to incorporate three strategic drivers: Regulatory Compliance, Asset Renewal, and Growth. A series of objectives related to each of these drivers was used to identify a range of capital investment needs for the water, wastewater, and stormwater infrastructure over the next 30 years. Projects and programs were reviewed to allocate the proportion of the benefits to each of the objectives/drivers. The Regulatory Compliance driver covered projects/programs needed to address both current compliance issues [i.e. facilities for which Halifax Water is not compliant with current permits to operate or legislation] and to future compliance issues [i.e. requirements resulting from imminent or emerging legislation]. The Asset Renewal driver covered projects/programs aimed at a sustainable approach to asset renewal and replacement. Asset Renewal requirements recognized the historical underfunding in some asset classes and evaluated the risk of continuing at the same level of reinvestment in the future. The Growth driver covered projects/programs aimed at providing regional level infrastructure to support growth and in managing flow allocations to optimize system capacity.
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Development of an overall planning framework integrating the IRP into Halifax Waters business processes Identification of institutional constraints required to implement the Recommended IRP Recommendations for additions and refinements of Halifax Waters Levels of Service [LOS] to facilitate the measurement of program success.
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The total 30year net present value [NPV] for the recommended plan inclusive of capital and O&M costs is $2,579 million. As indicated in Figure 6.1, asset renewal expenditures represent approximately 54% of the overall IRP; growth and regulatory compliance expenditures represent approximately 23% each. Of this $2,579 million, the breakdown by asset class is: $1,855 million for wastewater; $615 million for water; and $108 million for stormwater. Figure6.1IRPCostsbyDriver Total30YearNPV=$2,579Million Growth Compliance $595 $598 The recommended IRP informed Halifax Water regarding a number of shortterm implementation projects [3 year 2013/14 to 2015/16] and the longterm investment plan [30 years to 2042/43]. Coming out of the IRP, early programs and projects from the shortterm plan were incorporated into Halifax Waters fiveyear business, operating, and capital plans. For the purposes of practical implementation of the IRP recommendations and to align with the previous fiveyear plan, Halifax Water has ramped up Year 1 [2013/14] and Year 2 [2014/15] projected expenditures to phase in to the IRP Year 3 [2015/16] program. This acknowledges that a significant amount of effort continues to be needed to operationalize the recommendations of the IRP including the need to assess the utilities ability to deliver the plan in its entirety on the schedule recommended. As a result, Halifax Water intends to undertake an institutional capacity assessment to review the full
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suite of Halifax Water programs [both existing and proposed], the resources available, the organizational structure, project delivery methods, and necessary tools and systems to ensure the successful implementation of the recommended IRP. This initial IRP provides the framework for future IRPs. Integrated resource planning is a dynamic process. Like other masterplanning initiatives, the IRP needs to be updated at regular intervals. Ideally, IRP planning will be tied very closely to other masterplanning initiatives such as HRMs Regional Plan [RP] update, as illustrated in Figure 6.2. This initial IRP is expected to be updated in three to five years. Thereafter, the updates are expected to be undertaken on a fiveyear cycle such that they are coincident with HRMs regional planning process and updates. Figure6.2StrategicMasterPlanningFramework Revenue Planning Five-Year Business Plan Integrated Resource Plan Master Plans, Programs HRM Provincial and Annual Asset Regional Regulations Renewal Plan and Policies Halifax Water will need to use an adaptive management approach to respond to changing regulations, realization of projected growth estimates, and new information about asset condition and performance. Therefore, the recommended IRP should be considered the first step in an ongoing and evolving process of continuous improvement and strategic longterm planning. The IRP and the ongoing AM roadmap implementation are important projects for establishing Halifax Waters optimal level of asset reinvestment over the long term. These initiatives will assist in creating a sustainable assetrenewal program to ensure Halifax Waters assets are maintained within the principle of intergenerational equity, being mindful of financial constraints.
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6.2
FiveYearOperatingBudgets
Budgets have been developed to cover the period from 2013/14 to 2017/18, as shown in Appendix F. The operating budgets reveal that rate increases will be required to maintain current levels of service, deliver projects already in progress or approved, meet changing environmental requirements, and generate more capital funding from operating budgets to meet infrastructure investment demands. Some of the primary operating budget drivers and assumptions are: REVENUES Consumption will continue to decrease at 1.5% per year following past trends, as illustrated in Figure 6.3. This phenomenon is consistent with the experience of other North American water utilities. Figure6.3 MeteredConsumption
MeteredConsumptionHistory m3
46,000,000 44,000,000 42,000,000 40,000,000 38,000,000 36,000,000 34,000,000 32,000,000
2001/2002 2002/03 43,099,99 2003/04 43,099,99 2004/05 43,099,99 2005/06 41,498,28 2006/07 41,083,30 2007/08 40,672,47 2008/09 40,265,74 2009/10 39,863,09 2010/11 38,978,95 2011/12 39,177,49
Budget 43,099,99
Actual 43,244,100 43,231,98 42,635,188 42,013,52
41,220,04 40,176,851 40,414,055 38,695,646 38,824,219 37,782,016 36,980,486
Budget
Actual
Linear(Actual)

Averagedecrease Median TotalDecreasesince2001/02 1.5% 1.7% 14%
938 or roughly 1% new customer connections are projected each year.

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Revenues from unregulated business activities are increasingly important to mitigate future revenue requirements from rates. These are described in more detail in Section 6.4. Unregulated revenues will be used to fund unregulated expenses and generate additional unregulated revenues for the benefit of the rate base.
EXPENSES Halifax Waters Five Year Operating Budget is shown on an accrual basis for 2013/14 forward, to provide better information for decision making and be reflective of best practice for budgeting. There are accrued amounts regarding debt servicing, and liability for future employee benefits [pension] as calculated under CICA Handbook Section 3461 that for rate making purposes, will not be included in the revenue requirements. The utility faces pressure associated with growth, asset renewal, and compliance with regulatory requirements, as described in the Integrated Resource Plan. The largest components of Halifax Waters consolidated operating budgets are salaries & benefits, electricity, debt servicing, depreciation, and chemical costs. Salaries and Benefits Reasonable provisions for salary increase have been provided for in the Five Year Plan, based on collective agreements for CUPE Locals 227 and 1431, and market information for nonunion compensation. The annual salary increase allowance is 2%, with an additional allowance made to address the impact of step increases within salary bands or reclassification of positions; and increases in benefits. Electricity Budgets were established based on an assumption of electricity, fuel, oil and natural gas rate increases in each specific year. The impact of these increases is expected to be partially offset by the formal Energy Management Program initiated in 2011/12 [see Section 7]. The projected increases are shown in table 10.2: Electricity 8.3% in year 1, and 10% in years 2, 3, 4, and 5 Furnace Oil 10% in years 1 and 2, and with CPI in years 3, 4 and 5 Natural Gas 5.3% in year 1, 3.5% in year 2, and with CPI in years 3, 4 and 5 Debt Financing New debt payments are budgeted to support the fiveyear capital projects and include significant projects such as the Eastern Passage Wastewater Treatment Facility, a new Operations and Administration building expansion at Cowie Hill, and the Aerotech WWTF upgrade. Over the course of the next five years, debt payments are projected to increase significantly. The amount and timing of the increases will be determined by timing of the completion of the projects and the financing rates and options available. It is estimated total debt servicing may double by 2017/18, increasing to $45.7 M by 2017/18 [see Table 6.2]. The level of debt will ultimately depend upon the funding
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strategy recommended through the Debt Study as the most efficient and effective funding mechanism for capital. The debt servicing projections referenced above are based upon the status quo. Depreciation As Halifax Waters assets and future capital budgets increase so do depreciation expenses. Depreciation is an integral funding source to support rehabilitation of the existing infrastructure as well as new infrastructure and upgrades to meet future capital requirements necessitated by both servicing demands and changing environmental regulation. Over the course of the next five years, the depreciation expense is projected to increase from $14.3 M in 2012/13 to $26.6 M by 2017/18. Chemical Costs Chemicals are tendered annually in January for optimal pricing. Chemical cost increases of 5% are anticipated for 2013/14. Long range chemical prices are difficult to predict due to the volatility of the market which is closely linked with energy prices and fluctuations in supply and demand. Energy and Electricity cost assumptions are described in Table 10.2 within the Energy Management section of the Business Plan. On a consolidated basis, the projected fiveyear operating budgets are shown in Table 6.1. Over the next five years, operating expenses are projected to increase from $85 M in 2012/13 to $115.3 M, in 2017/18, or 35.6%, while operating revenues are projected to have a slight decrease due to declining consumption. Nonoperating revenues are projected to increase by 1.4%, however, nonoperating expenses may more than double due to increased debtservicing costs, unless the financing strategy ultimately recommended results in lower reliance on debt. For example, implementation of a Regional Development Charge would result in capital projects driven by growth being funded to a larger extent through development charges. This would result in reduced debt financing. Table6.1ProFormaIncomeSummary
Actual 2011/12 OperatingRevenue OperatingExpenses OperatingProfit(Loss) NonOperatingRevenue NonOperatingExpenditures NetSurplus(Deficit) PercentageIncreaseinRevenuetocoverDeficit IncrementalPercentageincreaseinOperatingRevenue Projection 2012/13 2013/14 2014/15 Budget 2015/16 2016/17 2017/18 $98,828,000 $105,375,000 $106,870,000 $105,566,000 $105,343,000 $105,122,000 $104,900,000 $77,244,000 $ 85,008,000 $96,328,000 $100,377,000 $108,194,000 $112,026,000 $115,365,000 $21,584,000 $ 20,367,000 $10,542,000 $ 5,189,000 $(2,851,000) $(6,904,000) $(10,465,000) $2,596,000 $2,968,000 $ 2,957,000 $ 3,002,000 $3,007,000 $3,009,000 $3,010,000 $25,173,000 $ 26,917,000 $27,095,000 $33,310,000 $36,566,000 $43,930,000 $ 51,679,000 $(993,000) $ (3,582,000) $(13,596,000) $(25,119,000) $(36,410,000) $(47,825,000) $(59,134,000) 12.7% 11.1% 10.8% 21.7% 21.8%
Note: These are consolidated numbers including both Urban Core & Satellite Systems, and Airport /Aerotech Systems; regulated and unregulated activities. The revenue increases
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required do not represent revenue requirements for future rate applications for regulated activities. Significant rate increases will be required to maintain or enhance the existing level of service and comply with stricter environmental regulations. Based on figures presented in Table 6.1, significant revenue increases are required over the next five years. Halifax Water will not be able to deliver the requirements for growth, asset renewal and compliance identified in the Integrated Resource Plan without significant revenue increases. As of March 31, 2012 Halifax Water had an accumulated operating surplus of $3.2 million. There is a projected $3.5M loss for 2012/13 as at October 31, 2012. These facts, combined with the forecasted future losses may create a cumulative operating deficit by 2013/14 unless rates are increased. Projections for 2012/13 are based on expected normal weather patterns. Should the 2013 winter weather be similar to the weather in 2012, the operating deficit could be less. It is important to note that as new and more current information becomes available, five year projections will change. The five year plan is sensitive to changes in interest rates, availability of infrastructure funding, and any changes in development charges.
6.3
DebtStrategy
On December 17, 2010, the NSUARB rendered a decision on an application by Halifax Water. The application included a capitaldebt policy that the NSUARB was not prepared to approve stating it did not accept that the 30/70 debtto equity ratio included in the debt policy was necessarily the most efficient. The NSUARB directed Halifax Water to undertake a complete study examining an efficient capital structure, the policies of other utilities, its longerterm capital needs, and opinions that would result in an efficient funding mechanism that is fair to present and future ratepayers. Halifax Water recognizes the importance of a debt strategy. Debt impacts the operating budget and, therefore, the future rate requirements in several ways: 1. Increased debt payments need to be accommodated through rates. 2. 3. 4. Increased depreciation as the capital program grows needs to be accommodated through rates. Operating costs of new capital needs to be accommodated through rates. Capital requirements not funded by debt will increase the requirement of capital from operating funding through rates.
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The terms of reference for the debt study were approved by the NSUARB; they included bestpractice research and comparison to public sector and private sector utilities, and were to focus on determining the most efficient capital structure for Halifax Water. Halifax Water is a unique entity from several perspectives as it is: A body corporate utility created under a separate provincial act with all its shares deemed to be owned by HRM. The first and only regulated water, wastewater, and stormwater utility in Canada A government business enterprise from an accounting perspective The largest water resources utility in Nova Scotia and the second largest utility in Nova Scotia
In recognition of its municipal and provincial relationships, the Municipal Finance Corporation [MFC], Halifax Regional Municipality, and Service Nova Scotia Municipal Relations are important stakeholders in finalizing the debt study and related debt strategy. The existing Capital Borrowing Guidelines for Municipal Units in Nova Scotia state that a municipalitys existing and projected debt service costs [excluding those related to self supporting utilities] should not exceed 30% of property tax and other ownsource revenues. As selfsupporting utilities are excluded from these guidelines, there has been no guidance for utilities such as Halifax Water to follow. In August 2011, Service Nova Scotia Municipal Relations confirmed that a debtservice ratio of 30% would generally be an appropriate measure for a selfsupporting utility such as Halifax Water. In December 2011 the MFC increased the unguaranteed debt cap for Halifax Water from $35 M to $70 M to reflect the fact that the asset base and revenues of the organization have roughly doubled with the addition of wastewater and stormwater services. On March 11, 2011 the NSUARB approved the Terms of Reference for the Debt Study and Halifax Water engaged the services of Mark Gilbert, Ph.D., to carry out the work. The study focuses on the four areas identified in the Board Order and concludes with a recommendation for an efficient funding mechanism that is fair to present and future ratepayers. The context for the recommendation is one that applies to a local government enterprise providing water, wastewater, and storm water services in Nova Scotia. The review of best practice covers eight information sources ranging from professional association manuals, practices, and publications to rating agency methodologies and reports. The information relevant to capital structure and debt limits for water / wastewater utilities and local governments is summarized.
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The best practice review suggests a municipally owned water, wastewater and stormwater utility providing service in its home municipality should select a capital structure and debt limits that reflect a focus on enhancing rate affordability and stability. These enhancements are subject to the factors and constraints, which include senior government legislation and regulation that influence and restrict the municipalitys debt policy. The two most appropriate financial criteria used in determining and evaluating capital structure and debt limits for a municipality and its enterprises are ones that measure debt service charges to annual operating revenues and total outstanding debt to either annual revenues or the property tax base. It is also useful to use an indicator that relates debt to the communitys ability to pay and the link between debt and taxable property is a suitable indicator. 2 Using the final Integrated Resource Plan as approved by the HRWC Board on September 28, 2012, several combinations of financing alternatives were examined using a robust financial model developed by the MFC, and modified by Halifax Water staff to be more reflective of the utilitys requirements. The financing alternatives were evaluated using three general principles:

1. Rate stability and affordability 2. Halifax Water long term financial sustainability 3. Intergenerational equity The debt strategy report concludes that some appropriate ratios for Halifax Water to utilize are:

1. Target Debt Service Ratio of 35% 2. Target Debt/Equity Ratio of 40%/60% In essence, the two targets will serve as a framework for Halifax Waters strategy when considering future use of debt. Additionally, the report addresses the issue of affordability and refers to a study conducted by the National Consumer Center for the AWWA Research Foundation. The study, while primarily focused on affordability of water charges, also addresses the affordability of wastewater charges. In the report, affordability of user charges is stated to be 2% of average user, median income households each for water and wastewater; i.e. 4% for both utility services [Saunders et al. 1998]. The manual also refers to a range of 2.3% to 3% of median household income for combined water wastewater bills used by the Ohio Public Works Commission in 1999. As standards have become more stringent since the Saunders study was undertaken, the 4% could now be viewed as the lower end of the affordability range.
2
Study of an efficient funding mechanism for Halifax Regional Water Commission Mark Gilbert, Phd October 2012 33
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It is important to note that Halifax Waters debt strategy must be acceptable to the Halifax Regional Municipality recognizing that the financial performance and outstanding debt of Halifax Water is incorporated in HRMs financial statements and credit rating although it does not have any actual impact on HRMs cost of borrowing. Submission of the Debt Strategy to the NSUARB does not result in any immediate changes to Halifax Waters budget or rates. The Debt Strategy will however be a document that supports future budgets, business plans, and rate applications. The actual financial strategies that staff will recommend to finance future infrastructure requirements will be consistent with the recommendations from the Debt Strategy, but will be reviewed and updated on an annual basis to reflect changes in key assumptions such as: 1. Interest Rates 2. Availability of Federal/Provincial Infrastructure Funding 3. Approval and implementation of a Regional Development Charge 4. Financial Constraints posed by rates and affordability issues There are natural constraints in place that restrict the use of debt, such as the ability to absorb operating costs of new capital, annual operating budget pressures caused by increased debt servicing and depreciation, and rate shock sensitivity around increasing rates. The impact of Halifax Water debt on HRM debt limits and policies as well as the current MFC requirement that HRM guarantee most of Halifax Waters debt is also a consideration in the development of an efficient capital structure. As noted in Table 6.2, longterm debt is projected to increase from $182 M at March 31, 2013, to $433 M by March 31, 2018. It is estimated total debt servicing will increase from $21.9 M in 2012/13 to $45.7 M by 2017/18. The DebtService Ratio is projected to be 21% as at March 31, 2013. Table6.2ProjectedDebtLevelsUnderExistingRates
HalifaxWaterDebtProjection TotalDebtServicing TotalDebtOutstanding DebtServiceRatio ProjectedOperatingRevenue* *doesnotincluderateincreases 2012/13 $21,993,256 $182,557,458 21% $105,375,000 2013/14 $22,712,819 $232,033,551 21% $106,870,000 2014/15 $28,456,892 $258,126,008 27% $105,566,000 2015/16 $31,658,103 $321,560,410 30% $105,343,000 2016/17 $38,545,569 $388,811,836 37% $105,122,000 2017/18 $45,741,158 $432,982,935 44% $104,900,000
Debt Service Ratio = [Total Debt Servicing/Total Operating Revenues]
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6.4
AlternativeRevenueStreams
Halifax Water has had success generating alternative revenues aside from user fees on both the regulated and unregulated side of the business. On the regulated side, Halifax Water has entered into agreements for the sale of land deemed to be no longer used or useful for utility purposes. These include tracts of land around Geizer Hill in Halifax [outside of the Chain Lake watershed boundary], land near the Larry Uteck Interchange in the Bedford West area, and lands in the Montague area of Dartmouth outside the Lake Major watershed boundary. With the approval of the NSUARB, revenue from these land sales has been used as a source of funds for capital projects related to the delivery of water services in recognition that the land was originally purchased with waterrate base funds. As much of the surplus land has been sold, this will not be a significant source of funds in the future with current reserves at $2.0 million. A purchase and sale agreement is also in place for the sale of a parcel at Geizer Hill just outside the Chain Lake watershed for a price of $2.7 million. The sale is subject to the approval of a development agreement and as such has not been included as a funding source for capital projects at this time. Notwithstanding limitations for generating revenue from the regulated side of the business, there has and will continue to be opportunities from the unregulated side of the business. Currently, Halifax Water generates revenue from thirdparty contracts for water and wastewater treatment. For 2012/13, these include projected fees of $785,200 for contract revenue for the treatment of leachate at Mill Cove and operation of the leachate treatment facility at the Highway 101 landfill, and $400,000 in sludge tipping revenue at the Aerotech facility. On the Water Services side, there is a contract with the Mirror Group to operate a water treatment plant at the Otter Lake landfill which will generate $16,015 in 2012/13. Other contracts are currently in place for operation of small wastewater systems in HRM recreational centres and the Twin Oaks nursing home in Musquodoboit Harbour. Annual revenues from these activities is estimated at $42,625. Halifax Water also generates revenue for the lease of land for telecommunications facilities throughout HRM in recognition that reservoir sites are located on higher elevations that afford more direct line of site for telemetry. In conjunction with these leases, Halifax Water installs telecommunications equipment on these facilities for its own needs for the ultimate benefit of the water, wastewater, and stormwater rate base. As Halifax Water continues to expand the Supervisory Control and Data Acquisition [SCADA] system in accordance with its master plan, further opportunities for leases and hosting of Halifax Water equipment will be realized. Current annual revenues from leases and rental of property are approximately $150,000. In recognition of Halifax Waters expertise in waterloss control, the utility offers a wide range of related services to generate revenue. These range from leakdetection services for Halifax Water customers and other municipalities to consulting services under contract to engineering firms and municipalities. There is great potential to expand these services to
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generate additional revenue and, at the same time, provide professional development opportunities for staff. Revenues for these services range from approximately $25,000 to $50,000 per year. Halifax Water also recognizes that its assets can be leveraged to bring in revenue from energy generation. This includes projects to generate electricity from wind turbines and control chambers where water pressure is reduced. Both of these initiatives are being explored for interface with the Nova Scotia Department of Energys Community FeedIn Tariff [COMFIT] program, which provides preferential rates to feed electricity into Nova Scotia Power Incorporateds [NSPI] distribution grid. Halifax Water has received COMFIT certificates for two wind turbine projects but the related projects are on hold pending further review from the Nova Scotia Dept. of Energy. Through efforts of Halifax Water staff, a Ministerial Directive was issued through the Dept. of Energy in 2012 to approve the recovery of renewable energy within water distribution systems at runofthe river rates. To that end, Halifax Water has recently received two COMFIT certificates for the installation of hydrokinetic turbines in the Orchard and Lucasville control chambers. The projected net revenues are in the current business plan. These projects are expected to have a positive overall financial impact as unregulated activity. These projects have been structured to ensure they are compliant with the Public Utilities Act with the recognition that regulated activities cannot subsidize the unregulated side of the business. In partnership with HRM, Halifax Water has also studied the potential for a green thermal utility whereby energy can be extracted from the heat in sewage and delivered through a local pipe distribution system in the vicinity of treatment facilities. The impending study for the redevelopment of the Cogswell interchange in Halifax will provide an opportunity to advance this concept since the Halifax WWTF is adjacent to the Cogswell interchange. No allowances have been made in the current business plan to realize revenues as the projects are currently in the concept stages. In an effort to be open and transparent to stakeholders including the NSUARB, Halifax Water inserted a schedule in its 2011/12 financial statements to disclose revenue and expenses associated with unregulated business. It is the intention of Halifax Water that the net gains from these activities would ultimately go to the benefit of the rate base. In 2011/12, Halifax Water realized net revenues from unregulated activities of $1.2 million which were all allocated to the rate base thus impacting rates in a positive way. The five year budget for unregulated activities is shown in Appendix F, page 6 of 6.
7.

ENERGYMANAGEMENT EnergyManagementProgram
7.1
Through its Energy Management Program, Halifax Water is committed to creating and ensuring an ongoing focus on sustainability and energy efficiency throughout all operating
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areas. This program defines the goals, objectives, accountabilities, and structure for activities related to sustainability and responsible energy use. In support of this new program, Halifax Waters Energy Management Policy defines longer term goals and commits Halifax Water to the principles of responsible energy management including reducing dependence on fossil fuels through energy conservation and best practices; identifying and implementing costeffective energyreduction initiatives throughout our operations; developing alternative and renewable forms of energy from utility assets; and reducing pollution by increasing the usage of energy supplied from sources that are less greenhouse gas intensive. Program Structure The Energy Management Program consists of the Manager, Energy Efficiency reporting to the Energy Management Steering Committee [EMSC]. The EMSC comprises the Directors of Engineering & IS, Water Operations and Wastewater/Stormwater Operations, and the Manager, Energy Efficiency. The chair of the EMSC is the Director of Engineering & IS. Reporting to the EMSC on a monthly basis, the Manager, Energy Efficiency is responsible for the creation and implementation of the corporate Energy Management Action Plan [EMAP] and any other activities defined by the EMSC. Reporting typically consists of progress reports on the energyrelated activities of Halifax Water including details of energy consumption, key performance indicators, and progress on energy projects and other related activities. It is believed that this program will be selfsustaining financially using ongoing savings gained through energy reduction and generation projects to fund operating expenses and program initiatives. Energy Management Action Plan The EMAP includes details of energymanagement activities that will be developed and undertaken by Halifax Water each year. Key activities contained in the action plan include: Delegation of the responsibility for achieving energy goals; Assignment of team members as required to meet goals; Development of an employeeawareness strategy to facilitate energy savings at work and home; Establishment of an energy accounting system that allows for collection, monitoring, and reporting of all data on energyconsuming assets, energy consumption, energy costs, energy savings, and key performance indicators; Preparation of energy audits on all facilities on a priority basis;
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Implementation of identified energy projects based on sound financial principles; Benchmarking of Halifax Waters facilities and establishment of annual energy reduction targets; Identification of funding requirements for the EMAP; Refinement of contract and purchasing policies to incorporate energyefficient practices; and
Development of renewable energy generation projects. One of the main tools used in any energymanagement program is the energy audit. This can range from a quick, lowlevel scoping audit to a complex, detailed investmentlevel audit. To date, midlevel audits are being completed for the three Harbour Solutions WWTFs: Mill Cove WWTF, J.D. Kline WSP, and Lake Major WSP, and Bennery Lake WSP. These audits will endeavor to identify potential energyreduction projects, will provide enough detail to allow a baselevel indication of feasibility and project complexity, and will allow the identification and prioritization of projects with the most potential for success and savings to be included in capital budgets over the next five to ten years. From these midlevel audits, a significant number of energyreduction opportunities have been identified thus far. These opportunities have the potential to generate significant energy and financial savings in the future. A preliminary list of opportunities identified to date along with an estimate of their implementation status, potential savings, cost benefits, and environmental benefits has been compiled.
7.2
RenewableEnergyGeneration
Halifax Water has also identified renewable energy as an important way of offsetting energy costs and increasing revenue that will move the utility closer towards netzero energy consumption and significantly contribute to greenhouse gas reductions in the region. To date, two key project areas have been identified: renewable energy and energy recovery from both water and wastewater systems.
7.2.1 WindEnergy
Halifax Waters land assets, namely the Pockwock and Lake Major Watershed areas, have potential wind profiles to be used as a renewable energy source. Halifax Water seeks to leverage its available assets to reduce operating expenses and provide greater value to its stakeholders and customers. As such, Halifax Water is exploring windenergy development opportunities in both of these areas.
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The Pockwock watershed comprises 5,661 hectares of land surrounding Pockwock Lake and has a significant wind regime. The project identified for this area consists of up to five, 2.3 MW wind turbines sited on lands located around the J.D. Kline WSP and outside of the watershed lands. The Lake Major watershed comprises 6,944 hectares of land surrounding Lake Major and Long Lake. The project identified for this area consists of two initiatives: one comprising five, 2.3 MW wind turbines and sited west of Lake Major on watershed lands and another comprising one 2.3 MW wind turbine and sited east of Long Lake on watershed lands. These windenergy projects have the potential to generate an estimated 50 GWh/year of electrical energy, an amount equivalent to approximately 84% of all of Halifax Waters current electrical energy consumption. In financial terms, under the newly implemented COMFIT program, these windenergy projects have the potential to generate an estimated $6.6M in annual electrical energy revenue resulting in an estimated net present value of $36.0M over the +20year life of the projects. To date, applications for all three projects have been submitted to the Nova Scotia Department of Energy for approval under their COMFIT program. For the two Lake Major projects, both of these projects have received COMFIT approval from the NS Department of Energy [DOE]. To date, research has been completed to allow Halifax Water to better understand the impact on the existing woods road, which runs through the Lake Major watershed, of any roadway or wind turbine site construction. Early stage community consultation has started with meetings being held with the Lake Major Watershed Advisory Board and a Distribution System Impact Study [DSIS] has also been completed by Nova Scotia Power. Next steps in the Lake Major project implementation process will include the evaluation of the potential impact to the watershed and water quality and deciding whether to proceed or not. If the project should proceed, next steps would then include project partnership identification, continued Aboriginal and local community engagement, sitebased wind resource data collection, and various environmental impact assessment activities. For the Pockwock project, the COMFIT application has been submitted to DOE. Due to a competitive COMFIT application on the same distribution zone as the Pockwock project, Halifax Water is in discussions with the competitive party to determine how a common application and wind development project can be structured for mutual benefit to both parties. COMFIT approval for the Pockwock project is expected once partnership details have been finalized and submitted to DOE. Other progress has been made, including the on site erection of a meteorological [MET]tower to begin wind resource data collection, and the completion of various site based studies, including avian studies, bat studies, flora and fauna studies, area surveys, and special places/archeological studies, all in anticipation of receiving COMFIT approval. Once approval has been received, next steps in the project implementation process will include the completion of a DSIS by NSPI, Aboriginal and local community engagement, continued sitebased windresource data collection, and an environmental impact assessment. Ideally, project construction and commissioning will be completed in the 2014/15 timeframe.
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7.2.2 HydrokineticTurbines
An opportunity has been identified to use inline turbines to recover energy from the water supply system in place of pressurereducing valves [PRVs], widely used by water utilities to reduce higher incoming pressure from a water line to a lower pressure more suitable for downstream distribution and customer use. While PRVs release energy to reduce pressure, they do not perform any useful work with that energy. Inline hydrokinetic turbines can be used to both reduce line pressure and recover energy and convert it to electrical energy that can then be used elsewhere. Halifax Water has investigated two potential projects for the installation of inline hydrokinetic turbines one at the Orchard Control Chamber in Bedford, and one at the Lucasville PRV Chamber in Middle Sackville. These projects have the potential to generate an estimated 325 MWh of electrical energy on an annual basis. In financial terms, under the newly implemented COMFIT program, these projects could generate an estimated $45,000 in annual electrical energy revenue over the +20 year life of the projects. Halifax Water has requested and received approval from DOE to allow these types of projects to be considered equivalent to runofriver hydro under the provincial COMFIT program. Subsequently, Halifax Water submitted COMFIT applications for these projects and has received COMFIT certificates for both. Both projects are considered research and development projects for this relatively new and innovative application of an existing technology. As such, the Orchard project has received funding approval from the Water Research Foundations [WRF] Tailored Collaboration Program, a program which enables WRF utility subscribers to partner with the WRF on research, and funding from Nova Scotia Department of Environment. The Lucasville project involves the development and application of a smaller, plug & play style system, utilizing technology that is being developed in partnership with Rentricity Inc., a New York based developer of small hydrokinetic turbine systems, and Xylem, a global leader in the development of water and wastewater pumps and pump control systems.
7.3 EnergyRecovery
Energy recovery from process or waste streams is recognized as one of the biggest opportunities available to society today. Recoverable energy is everywhere in solid municipal/residential waste streams, industrial byproducts, and water and wastewater streams. Halifax Water has significant recoverable energy resources available in both its water and wastewater streams. Specifically, as noted in the previous section, inline hydrokinetic turbines can be used in place of pressure reducing valves [PRVs] to recover energy from water distribution systems. In the wastewater system, energy can be recovered from the waste sludge produced by wastewater treatment facilities, heat exchangers and highly efficient industrial heat pumps can be used to transfer energy from
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one system to another, energy that can be supplied for heating or removed for cooling, and biogas can be produced to fuel a combined heat and power [CHP] system to generate electrical energy and heat from the combustion process that can then be used for treatment process or building heat.
7.3.1 EnergyfromBiomass/Biosolids
In April 2010, the Government of Nova Scotia released its Renewable Electricity Plan to support and encourage increased development of renewable energy resources for electricity generation. The plan sets out a detailed path for the province to gradually move away from traditional energy sources to energy sources that are more local, clean, secure and sustainable. In accordance with corporate policy, Halifax Water is focused on energy conservation, efficiency improvement, and renewable energy generation strategies to meet its long term energy, environmental and financial goals. Energy from biosolids is one type of renewable and sustainable energy that is readily available from Halifax Waters wastewater treatment facilities, as well as other municipalities. Halifax Water currently supplies over 35,000 tonnes per year of partially dewatered sewage sludge to its Aerotech BioSolids Processing Facility [BPF]. Currently, this sludge is turned into a soil amendment that can be used as fertilizer for topsoil manufacturing, sod growing, horticulture, and land reclamation. An opportunity exists to use both biomass and biosolids as an energy source to produce both electricity and heat by modifying the existing BPF located in Aerotech Park near the Halifax Stanfield International Airport. A recent peer review, commissioned by Halifax Water and presented to Halifax Regional Council in November 2011, suggested that Halifax Water review other options for biosolids management. The use of both biomass and biosolids as a renewable energy source is another affordable, clean, alternative process that can help Halifax Water manage its biosolids program in a sustainable manner. This approach also aligns with the Canada Wide Approach for the Management of Wastewater Biosolids approved by CCME in October, 2012 Halifax Water has submitted an application for the development, installation, commissioning and operation of a biomass and biosolids [NViro Fuel] fired 2.8 MW Cogeneration facility, the purpose of which will be to generate and supply electrical energy under the Community FeedIn Tariff [COMFIT] program and heat to the adjacent BPF. The heat generated by the NViro Fuel would be used to dry the biosolids processed at the existing BPF and other organic waste [i.e. biomass]. The electrical energy generated would be sold to the electrical grid under the COMFIT program. This renewable energy would eventually offset the electricity and natural gas currently used at the BPF. It is expected the project would eliminate the use of over 725,000 cubic metres/year of natural
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gas, worth $200,000annually, produce over 20 million kWh/year of electrical energy, and offset approximately $3,500,000 of electrical energy costs per year.
7.3.2 WastewaterEffluentHeatRecovery
The volume of wastewater effluent flowing out of wastewater treatment facilities is immense. The capacity of water to store energy in the form of heat is also immense. This combination presents a real and readily available resource for an efficient, costeffective heat sync that can be used, at a minimum, to provide or remove energy to and from wastewater treatment facilities, or to the local community at large. The potential exists to dramatically reduce the amount of energy purchased and used for heating in at least three of the largest wastewater treatment facilities belonging to Halifax Water. The power available and cost savings potential is summarized in Table 7.1. Table 7.1 Wastewater Effluent HeatRecovery Potential Available Required Annual Annual % of Power Heat Heating Facility Flow Available Capacity (1) Energy (3) Costs (3) [m3/yr] Capacity [MW] [MW] [$] Halifax WWTF Dartmouth WWTF Herring Cove WWTF Totals 38,565,000 21,095,000 4,500,000 64,160,000 61.5 33.6 7.2 102.3 0.6 0.4 0.3 1.4 1.0% 1.4% 5.2% 9.2% $85,000 $65,000 $140,000 $305,000
1) Total available power based on an average effluent temperature of 12C. 2) Mill Cove uses recovered biogas as its primary energy source. 3) Based on 2011/12 usage and cost data. Halifax Water has initiated studies at the three Harbour Solutions plants to determine and understand the technical and financial challenges associated with these types of energy recovery systems, and then implement the projects that make sense from an energy efficiency and financial perspective. The current HRM study to assess the development potential for the Cogswell Street Interchange area will also provide a real opportunity to assess the potential for a green thermal utility in partnership with HRM.
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7.3.3 BioGasCHPEnergyUtilization
Halifax Waters Mill Cove WWTF is classed as a secondary treatment plant that utilizes a mesophilic anaerobic biodigestion process to reduce sludge volumes and generate biogas in the form of methane that is then burned to provide process heat to support the digestion process and space heating for facility buildings. On average, this process generates over 650 m3/day of methane gas. Currently, and on an annual basis, roughly 55% of this gas is used for process and building heat and 45% is sent to a flare stack to be burned. The opportunity exists to optimize and maximize gas production levels at the Mill Cove plant and install a Combined Heat and Power [CHP] system to utilize this renewable energy to produce both electricity and heat. It is envisioned this system will burn 100% of the bio gas produced to generate electricity and capture heat from the exhaust gases to provide the required process and building heat throughout the year. It is possible that enough electrical and heat energy can be generated onsite to provide 100% of the electrical and heat demand of the Mill Cove facility. Halifax Water will seek to determine and understand the technical and financial challenges associated with these types of systems and determine project feasibility from an energy efficiency and financial perspective.
8. 8.1
CONTINUOUSIMPROVEMENT OrganizationalCulturalChangeProcess
Mergers and acquisitions have always created opportunities and challenges for organizations, and Halifax Water is no different in that respect. With the water, wastewater, and stormwater merger of 2007, Halifax Water brought staff together with different values, work practices, and demographics. It is the utilitys obligation to nurture and foster a renewed culture of accountability, innovation, teamwork, and collective purpose. Many activities have commenced or have been completed to reinforce this objective including preparation of a revised mission, vision, and corporate balanced scorecard [see Appendix A]; consolidation of policies; negotiation of new collective agreements; implementation of a formal continuousimprovement program; and consolidation of administration and operational facilities. With regard to its unionized workforce, Halifax Water previously operated under two collective agreements for its outside workforce: one to cover water services and one to cover wastewater/stormwater services. In 2012, the utility successfully completed collective bargaining with CUPE Local 227 to integrate its outside workers into one collective agreement which will go a long way to put all outside workers on a level playing field and entrench managements right to direct the work force. As for the inside workforce, Halifax Water also negotiated a new collective agreement with CUPE Local 1431
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to ensure a consistent approach to labour/management relations. With the completion of collective bargaining, a more stable labour/management relationship has emerged to support a new workforce culture. The current union contracts expire on October 31, 2013 and bargaining is expected to commence in the fall of 2013. It should be recognized that Halifax Water, like other employers, operates with staff from four distinct demographic groups: Veterans; Baby Boomers; Generation X; and Generation Y. In recognition that these groups bring varied values to the organization, different approaches are necessary to motivate staff to pursue corporate objectives. It is also recognized that employment of visible minorities and immigrants brings diversity to the organization reflecting the communities served by the utility, and efforts have been made to attract these individuals to consider a career with Halifax Water. As mentioned above, Halifax Water has initiated a formal continuousimprovement program coming from participation in the AWWA/WEF QualServe Program.3 A steering committee has been formed to discuss improvements and make recommendations to Halifax Water management. A common thread in the initiatives is fostering interdepartmental relationships that if harnessed can lead to breakthrough results. Historically, this approach has had success with the waterloss control program as a shining example. It is anticipated that the organization can also rally around environmentalcompliance objectives, asset renewal, energy management, and control of wet weather flows as strategic initiatives that will necessitate teamwork, adoption of best practices and innovation. Linked to success will be enhanced communication within Halifax Water and with external stakeholders and customers. In addition to achieving operational efficiency and effectiveness, synergy is reinforced when staff are physically in contact with one another. Halifax Water has a facilities consolidation plan that will see the expansion of the administration building at Cowie Hill in 2013 to house the Finance and Customer Service, Engineering & IS, and Environmental Services departments. The facilities plan also includes the construction of combined water and wastewater operations depots with a new building at Cowie Hill to serve the west region, an expansion of the Woodside facility to serve the east region, and construction of a new building in Sackville to serve the central region. The operations depot at Cowie Hill has recently been completed, and it is anticipated that the other facilities will be constructed near the end of the fiveyear timeframe. Construction of the Operations depot in the Central region is tied to the timing of a new highway to connect Bedford with the Burnside Industrial Park. Halifax Water has reached an agreement with NS Transportation and Infrastructure Renewal to sell utility property housing wastewater/stormwater operations at Mann St. in Bedford to facilitate the highway expansion.
The QualServe Program is sponsored by the American Water Works Association and the Water Environment Federation, and is designed to help water, wastewater, and stormwater utilities improve performance.
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Recognizing that measurement of performance can drive improvement, Halifax Water continues to track performance through a Corporate Balanced Scorecard recently updated to include measures across all services. In an effort to take this to the next step, Halifax Water is proposing to join the National Water and Wastewater Benchmarking Initiative [NWWBI] facilitated through AECOM. The NWWBI began in 1997 and now includes over 45 Canadian utilities who take a very structured approach to metric and process benchmarking. The NWWBI approach has garnered international recognition as a best practice and Halifax Water believes it will foster a stronger continuous improvement culture within the utility. The 2013/14 and 2014/15 operations budgets contain an annual expense of $65,000 to participate in the national program. This action also conforms to one of the NSUARBs direction in its recent decision on the Urban Core rate application.
8.2
SuccessionPlanning
Succession planning continues to be important for Halifax Water given the number of impending and potential retirements, and our desire to attract and retain leaders. A formal successionplanning process began in 2009 to ensure continuity of leadership and identify qualified successors for key positions within the workplace. The initial steps included a review of Halifax Waters senior management positions that included the general manager, director, superintendent, and manager positions. The process is ongoing and includes the identification of core leadership attributes, high potential employees, and gaps in our existing pool of talent. To make this successful, it is important to align corporate needs with the development goals of the individual, and that they receive the training and experience necessary to take on more responsibility in the organization. The planning has recently extended beyond the key senior positions to include firstlevel supervisors as well as positions requiring specialized knowledge. To that effect, a supervisor competency training program is currently being developed with expected delivery during the 2013/14 fiscal period. This multisession training program is aimed at developing key supervisory competencies needed to lead and manage a work team more effectively and efficiently. The leadership abilities developed through this program, in addition to mentoring, experiential and formal learning initiatives, will ensure Halifax Water has a pool of highpotential successors for the more senior roles in the organization. Where necessary, there is a planned overlap of the new hire with the retiring employee. This can lead to a smoother transition and often offers a positive experience for the organization, the retiring employee, and the new hire. The format can vary to allow a tailored approach to meet the specific challenges and immediate needs.
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8.3
WaterQualityMasterPlan
April 1, 2012, marked the end of the fifth and final year of the initial term of the Halifax Water/Natural Science and Engineering Research Council of Canada [NSERC] Industrial Research Chair and Water Quality Master Plan [WQMP] research program. Recognizing this as a critical point in the research program, Halifax Water staff recently evaluated the overall progress and outcomes of the program and developed a second version of the WQMP [WQMP V2] that included updated waterquality goals and redefined strategic objectives to guide the utility throughout the next phase of research. The detailed WQMP V2 is contained in Appendix G. Several key objectives focusing on improved water quality in the distribution system are already well underway. The monitoring of natural organic matter removal within the treatment plants paired with a distribution system disinfection byproduct monitoring program will enable Halifax Water to make critical decisions on where to focus disinfection byproduct [DBP] mitigation efforts to attain the utilitys internal goals for THMs and HAAs. Additionally, the lead service line replacement and residential sampling programs are in their second year and continue to grow each year. These programs have enabled Halifax Water to take a proactive stance on managing health risks of lead in drinking water and promoting public awareness of this public health issue. The WQMP has been a key tool in establishing waterquality goals and setting a baseline for monitoring progress toward these goals. There has been much success in completing a number of the tasks to achieve goals, and Halifax Water has already adopted some process operational changes and is currently investing in some capital upgrades as a direct result of research findings. In the same manner, as expected, a number of WQMP research tasks have been identified, through either internal or external research, as being no longer necessary or suitable for implementation at Halifax Water facilities. Although the overall waterquality goals identified in the WQMP remain on the priority list for Halifax Water, there are other waterquality objectives that the utility has identified as being significant to improving or strengthening waterquality management and performance within the utility. These objectives and accompanying research tasks are included in the revised research plan to keep Halifax Water at the forefront in its delivery of highquality water. Substantial efforts will be placed on shifting the focus of Halifax Waters strategic planning partially away from longterm waterquality goals and more towards what can be done to support treatment plant operations and improve water quality from a daytoday perspective. To date, the research program has focused on optimized treatment processes for the J.D. Kline water supply plant. Although several tasks will remain focused on improvements for this facility, several research requirements have been identified in other treatment facilities to address operational challenges and treatment issues. Research efforts will also be focused on adapting a more proactive approach to monitoring and optimizing both treatment operations and treated water quality, and on efforts towards monitoring and understanding distribution water quality and performance. Finally, substantial efforts will be made to implement sustainable processes and optimize energy demands during the implementation of all research findings.
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The construction of the pilot water treatment plant in 2007, as the primary infrastructure and experimental resource of the research program, has also been fundamental to the success of the research program to date. Since much of the research tasks focus on process improvements, the use of a pilot plant has provided great benefit for coagulation, mixing, and filtration studies. Research results have already identified the shortcomings of using benchscale results as a primary research tool for process optimization studies. In the spring of 2012, the pilot plant was upgraded to allow investigations into the use of engineered biological filtration as a means to improve natural organic matter removal and the subsequent mitigation of disinfection byproducts. This technology is currently at the forefront of water research in North America and Halifax Waters participation in this research program shows the utilitys commitment to research in innovative water treatment technologies. Halifax Water has also recently evaluated the benefits and overall success of the research agreement with Dr. Graham Gagnon of Dalhousie University to execute the research tasks in the WQMP. The overall progress and research findings are evidence that the research program with Dalhousie University is achieving its intended goals, not the least of which is providing improved water quality and reduced treatment costs for Halifax Water customers. In addition to significant research contributions, Halifax Water has identified several other invaluable benefits that accompany this research partnership including: significant training and educational impacts for both students and Halifax Water staff; several opportunities to participate in highprofile international research collaborations; access to a network of international leaders in drinking water research; recognition of Halifax Water and Dalhousie University as a centre for excellence in drinking water quality and research; and, finally, access to a skilled research team to carry out projects that arise in response to imminent needs outside our initial research path. To that end, Halifax Water has committed to renewing the research contract with Dalhousie University for a fiveyear period at a contribution of $139,000 per year. In 2012, Dr. Gagnons proposal for a renewal of the Halifax Water/ NSERC Industrial Research Chair was approved The extension of the research program for another five years will coincide with the duration of the Research Chair and ensure that the matching funds from NSERC are fully utilized.
8.4
EnvironmentalManagementSystemISO14001Expansion
ISO 14001 is an international standard for an environmental management system [EMS]. The benefit of implementing an EMS is that it drives a process of continual improvement towards meeting defined environmental goals and objectives. Regulatory compliance becomes one of the defined primary goals, and standard processes are put in place to identify noncompliance issues and direct improvements through documented standard operating procedures. Water Services have an EMS program in place and have registered the Pockwock Lake, Lake Major, and Bennery Lake facilities to ISO 14001. Halifax Water is proposing to expand
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the EMS program to initially include wastewater services and eventually to include all aspects of corporate operations such as fleet and building management, purchasing, contract services, and Occupational Health & Safety. As a first step in implementing ISO 14001 for wastewater, Halifax Water will adopt a sewershed approach and will begin with one selected wastewater facility and associated sewershed. During the 2012/13 fiscal year, an appropriate software package for EMS management will be selected and purchased. Such software allows tracking of all EMS related documents, and all required actions and followups including assignment of due dates and responsibilities. Also during 12/13, Halifax Water engaged the services of Duerden & Keane Environmental Ltd. to assist with the design and creation of the internal components of the Wastewater EMS program, drawing on the experience gained from the Water Services program. The consultant will assist in completing the initial EMS stages such as defining the scope, identifying the environmental aspects of the operation, determining the goals and specific objectives, and providing guidance on writing the standard operating procedures required to achieve the defined objectives. They will also provide advice on the appropriate software package to assist in managing all aspects of the EMS program and related occupational health and safety activities. An additional internal staff position will be required to implement and manage the corporate ISO program with an EMS Coordinator proposed for the 2014/15 fiscal year. Over time, additional wastewater treatment facilities and associated sewershed components such as pumping stations, holding tanks, and collection system sewers will be incorporated until all wastewater facilities are included and registered.
8.5
WetWeatherFlowManagement
Background Wet weather flows are the most serious regulatory and operational problem in Halifax Waters wastewater system. These flows cause a multitude of problems for Halifax Water, customers and the general public, during and after rainfall events: Wastewater overflows into freshwater and marine water bodies. There are approximately 100 wet weather overflow locations related to the wastewater and combined sewer collection system, mostly at CSOs and pumping stations but some at manholes. Impacts on wastewater treatment facilities. High wet weather flows cause washout of the treatment process at some facilities, resulting in undertreatment of the wastewater. Also, at some treatment facilities, portions of the high flows are required to bypass some or all of the treatment processes. Both of these conditions result in increased risk to public health, greater impacts on the receiving environment, and
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regulatory violations. Further, at some facilities, the impact and the type of treatment process is such that it can take weeks for the bacteria and the process to reestablish itself, so that the facility is able to return to its normal operational status. Surcharging of the wastewater collection system, resulting in wastewater backups into buildings, especially basements. These backups are a burden for property owners in various ways: risk to their health; cleanup costs; inconvenience; possible increased insurance rates; and possible inability to get insurance coverage. Usurping of valuable system capacity which was intended to be used for growth and development. Increased operational costs. One significant cost is related to power for the 180 pumping stations and 15 wastewater treatment facilities for which Halifax Water is responsible. Another is staff costs, including overtime, related to responding to various aspects of wet weather events, including wastewater overflows, treatment facility impacts, system upgrades to accommodate wet weather flows, customer compliance, customer complaints, insurance claims, and others. It should be noted that the extent and severity of the problems listed above are typically greater for the more severe rainfall events, and less so for minor events. To provide some context to the magnitude of the wet weather flow problem, during typical storm events, peak flows can increase in the order of five to ten times the normal flow, and more. Also, Halifax Water staff have analyzed flow patterns within the sewersheds with separate sewers [as compared to combined sewers, which were designed to accept stormwater], and determined that on average, approximately 35% of the total flow in the wastewater system is stormwater. The actual number may be greater than this, in that the analysis does not account for all the volumes of overflow, some of which are not currently being measured. Capital budgets have and will continue to contain funds for flow monitoring to ensure better system understanding. The sources of high wet weather flow in a wastewater system are derived from infiltration and inflow [I&I], which is the entry of stormwater, including groundwater, into the wastewater system. There are two fundamental approaches to managing wet weather flows to reduce or eliminate the negative impacts described above. One is to eliminate I&I at the source before it enters the wastewater system. The second is to manage the wet weather flow in the system by constructing larger infrastructure and by developing and utilizing operational improvements. There are advantages and disadvantages to each approach. Reducing I&I at source is a very difficult and timeconsuming process. It can be a short term solution in small sewersheds, but in most sewersheds, it is a long term solution. However, this approach tends to be more sustainable in that the lifecycle costs may be lower, and the wastewater system does not
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have to handle the high wet weather flows through the various components of the system pipes, pumping stations, storage facilities and wastewater treatment facilities. The second approach can be implemented more quickly and with more certainty of success, but the costs capital and operating tend to be greater. Larger infrastructure is required to transport, store and treat the large wet weather flows, and because the flows are not reduced, the operating costs are also greater. Current Programs Halifax Water currently considers both approaches noted above when addressing wet weather flow problems in individual sewersheds. One or the other approach, or both, may be utilized. Knowing how much I&I is entering the wastewater system, and the source of this I&I, is critical to success in all elements of a wet weather flow management program. Halifax Water uses a number of tools to assist in this frontend part of the program: flow measuring [both temporary and permanent]; smoke testing; closedcircuit television inspection; dye testing; and visual inspection. Also, a network of rain gauges is being installed to capture better rainfall information to correlate rainfall intensity and duration with wastewater overflow events. There are two basic categories of I&I, each requiring a different solutionset. One is I&I directly into the wastewater collection system through defects in the pipes, manholes and other system components. This category of I&I tends to be a problem in older systems which have not been maintained as it has aged. This category of I&I is the direct responsibility of Halifax Water to resolve. Sometimes the approach is to repair identified sources of I&I on an operational basis, by sealing manholes, repairing pipes and joints, and possibly replacing shorter sections of pipe. However, at some point, older systems have deteriorated to the point that operational repairs are no longer feasible or costeffective. In this case, the system must be replaced as a capital project. The second category is I&I directed into the system by private property owners. The discharge of stormwater and groundwater into the wastewater system is prohibited by the HRM Charter and is regulated by the Rules and Regulations of Halifax Water. Halifax Water has developed a program, called the Stormwater Inflow Reduction [SIR] Program, to locate such discharges, and to administer and enforce the legislation and regulations with respect to such discharges. Pursuant to the Rules and Regulations, the cost to rectify such discharges is the full responsibility of the customer. The program started at Halifax Water in 2009, with the initial focus being residential sewersheds. In 2012, the SIR Program shifted primary focus from residential properties to industrial, commercial and institutional [ICI] properties. The ICI properties are often large and have significant areas of hard surfaces [e.g. rooftops, driveways and parking lots] generating high stormwater runoff. One ICI property can sometimes generate stormwater
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I&I into the wastewater system equal to hundreds of residential properties. The long term success of the SIR program may depend on the ability to get customers to dispose of stormwater correctly without the intervention of Halifax Water. Educating property owners, contractors, real estate agents, home inspectors and other stakeholders in the proper methods of handling stormwater and wastewater is critical. Efforts to educate and inform customers regarding the correct way to dispose of stormwater will continue, in partnership with HRM, the Insurance Bureau of Canada, and local NGOs. Within HRM, the areas which tend to have high contributions of I&I from private properties are those areas which have no deep storm sewer. The most sustainable manner of draining private properties is by gravity, which for homes with basements requires a deep storm sewer. The development standards in some areas of HRM in the 1960s, 70s and early 80s did not require a deep storm sewer, and it is those areas where high rates of I&I are common. With this in mind, Halifax Water developed a policy in 2009 to install such storm sewers on an equal cost share basis with HRM and the local property owners. The policy was approved by the Halifax Water Board and forwarded to HRM for their review. HRM has not approved the policy to date, but appear to be on a path to respond to the costshare policy in the near future. Any cost sharing from Halifax Water for deep storm sewers is also subject to the approval of the NSUARB. Halifax Waters annual Capital Budget typically contains projects which either directly or indirectly provide for improved wet weather flow management. For example, any facility expansion or upgrade will be designed and constructed so as to reduce wet weather overflows and reduce impacts on wastewater treatment facilities. Further, replacement of wastewater sewers due to age will have the effect of reducing I&I into the system. The wet weather flow problems suffered by Halifax Water are not unique. In fact, such problems are common across North America, especially in older cities with aging infrastructure. A number of jurisdictions in Canada and the USA have embarked on 20 and 30 year wet weather flow reduction programs. Future Initiatives As described above, Halifax Water has programs and practices in place to address I&I problems and to improve the management of wet weather flows within the wastewater system. However, Halifax Water staff are in the process of developing a more comprehensive and proactive approach to this issue. The wet weather flow problem is a complex one, involving a broad range of different solutions. A more comprehensive, planned approach is required, including dedicated and specialized resources. A steering committee has been put in place, comprised of the General Manager and senior staff of four key departments Wastewater and Stormwater Services, Water Services, Environmental Services, and Engineering and IS. This committee will be developing a strategy, and identifying key resource needs, during the second half of 2012/13.
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Some specific activities that are being considered or will be implemented are: Search for worldclass expertise to assist in developing a Wet Weather Flow Management Strategy. The application of trenchless technologies is a mechanism which could help in carrying out timely repairs of old, leaking wastewater mains and laterals. The local marketplace may not have historically had enough projects to attract contractors for this line of work, but Halifax Water will be identifying candidate projects to attract contractors to apply this technology to I&I reduction efforts. Expansion of the permanent flow monitoring network and acquisition of additional portable flow measuring equipment will be achieved through the capital budget. Additional monitoring points will be installed at key pumping stations over time and connected to the PI system. The use of technology such as wireless download and the connection of additional monitoring points to PI will increase efficiency in identifying problem areas while enhancing the safety of staff. Linking compliance testing to the sale of a property may be an effective and sustainable way to eliminate illegal [stormwater] connections from the wastewater system. Property owners are motivated to have their property comply, plus have access to financing to pay for repairs if needed. A program will be developed to have compliance testing done in conjunction with the sale of a property or the creation of a new service account. Measuring of wastewater overflows, consistent with the CCME municipal wastewater effluent strategy and related regulations.
9. 9.1
SAFETY&SECURITY CorporateSecurityProgram
Halifax Waters Security Program is based on enterprise assets protection and is designed to protect three types of assets: people, property, and information. It also considers intangible assets such as the organizations reputation, relationships, and creditworthiness. The program has been developed to take an allhazards approach, be it from natural, intentional, or accidental hazards, when reviewing risks to the organization.
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Halifax Water uses the three basic elements of a physical security system to protect its assets to ensure it accomplishes its mission. Protection: The protection element is the physical barrier that delays the determined adversary and the opportunist in accomplishing their goals. Halifax Water uses barriers such as building fabric, fences, doors, door hardware, and containers to protect its assets. Detection: The detection element indicates and may also verify an actual or attempted overt or covert penetration. Halifax Water uses intrusion alarms, access control systems, CCTV, guards, and patrols to protect its assets. Response: This element is the reaction to an attempted or actual penetration. Halifax Water uses guard forces and police forces to protect its assets.
Halifax Water uses two sources of information it gathers through use of consultants when designing an effective security system that assists the organization in completing its mission. Vulnerability Assessments In 2003, Halifax Water completed a risk assessment for Water Services using the Risk Assessment Methodology for Water [RAMW] developed by Sandia National Laboratories. The outcome of this project assisted the organization in developing a list of critical assets for water and allowed us to direct our resources to improve our security readiness and meet our mission objectives. In 2009, the same methodology [RAMW] was used to define critical assets in Wastewater Services and provide a roadmap for security improvements. In 2013/14, Halifax Water will be completing this exercise again for water, wastewater and stormwater infrastructure using the Risk Analysis and Management for Critical Asset Protection [RAMCAP] developed by the American Society of Mechanical Engineers [ASME]. RAMCAP is a process for analyzing and managing the risks associated with malevolent attacks and naturally occurring hazards against critical infrastructure. It will provide a consistent, efficient, and technically sound methodology to identify, analyze, quantify and communicate the level of risk and resilience, and the benefits of risk reduction and resilience enhancement. It will also document a process for identifying security vulnerabilities, consequences, and incident likelihood and provides methods to evaluate the options for reducing these elements of risk. As Halifax Water did in 2003 and 2009, selected employees will be trained in the RAMCAP process and complete an integrated assessment of water, wastewater and stormwater assets.
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Security Consultation Halifax Water employs the service of security consultants who review each facility identified in the Vulnerability Assessments. The security consultants evaluate the administrative and organizational security, personnel security, physical security, and technical security measures followed by each facility and determine if they meet comparable institution standards, and are commensurate with current threats. The consultants also identify practices and procedures that may reduce the security of each facility and recommends costeffective corrective measures to provide an acceptable level of security based on the three basic elements of a physical security system: protection; detection; and response. Security Budget Operational and capital funding is required for a range of securityrelated initiatives and upgrades. The proposed capital budget is $200,000 for 2012/13, and $250,000 for each of the four years following. Due to the sensitive nature of the projects, details are not provided in this document. Emergency Response Planning As safe and reliable drinking water, sanitation and environmental protection are vital to the sustainability of communities with Halifax Regional Municipality [HRM], Halifax Water realizes that the documentation of an Emergency Response Plan [ERP] is an essential part of managing a drinking water, wastewater, and stormwater utility. The purpose of the ERP is to establish an organizational structure and procedures for response to water and wastewater/stormwater incidents in HRM. It assigns the roles and responsibilities for the implementation of the plan during an emergency following the Incident Command System [ICS] model. The preparation and exercising of an Emergency Response Plan can save lives, reduce risk to public health, enhance system security, minimize property damage and lesson liability. Halifax Water has trained employees involved in emergency response and will maintain readiness by regular training including the conduct of tabletop exercises.
9.2
OccupationalHealth&SafetyPrograms
Halifax Waters Occupational Health and Safety Program is based on the Internal Responsibility System [IRS], which is the foundation of the Nova Scotia Occupational Health and Safety Act. The IRS is an internal system that gives everyone direct responsibility for health and safety in the way that best fits with what they do.
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The Safety and Security division of Environmental Services has principal duties and responsibility as part of the IRS as follows: 1. Assist in formulating and supervising the execution of the HRWCs general safety/loss control policy and assist management to fulfill, to the greatest degree possible, its responsibilities for safety. 2. Coordinate and/or provide safety training to staff in an effort to prevent accidents, minimize losses, increase productivity and efficiency, and ensure compliance with safety legislation and policies. Conduct safety audits in the workplace to identify safety hazards and recommend control measures. Assist in the development and maintenance of a system of accident investigation, reporting, and followup. Provide program education for on and off the job safety. Act as resource to the Joint Occupational Health and Safety Committee [JOHSC]. Carry out a continuous analysis and evaluation of services rendered. Maintain liaison with federal, provincial, and local safety organizations by taking part in the activities and services of these groups.
3. 4. 5. 6. 7. 8.
Halifax Water has established and maintains an Occupational Health and Safety Program in consultation with the Joint Occupational Health and Safety Committee. The Safety and Security division has identified the following policies and initiatives that require updating and will work with the JOHSC and the organization at the departmental level in implementing these over the next five years. Incident Reporting Policy A standardized procedure is currently being developed across the organization including the development of a computerized system for documentation of safetyrelated incidents and nearmisses. Corporate Safety Training Policy Halifax Water is ensuring all staff receives effective safetyrelated training. The Safety and Security division is working with the Human Resources department identifying training related to staff health and safety. A more comprehensive training program has been developed, and better tracking and scheduling will be instituted.
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Trench Safety Policy Trench safety is critical to Halifax Water and its staff given that much of our infrastructure is located underground. The current program manual has been updated and standardized across the organization. RespiratoryProtection Policy This policy is related to equipment such as selfcontained breathing apparatus, supplied air respirators, and halfmask chemical and dust respirators. A number of activities are contemplated: the current program manual will be updated; equipment will be standardized, inspected, and certified; and all users of the equipment will be fit tested. HearingConservation Policy A number of activities are contemplated. The procedures will be updated, hearing protection equipment will be standardized across the organization, annual testing will be made available to all employees, and all noise hazards will be identified and labeled at all Halifax Water facilities. Traffic Control Related to ShortTerm Work in Streets Many activities carried out in the street by Halifax Water staff are short term in nature such as locating infrastructure; conducting inspections of manhole and catch basins; taking wastewater and stormwater samples from manholes; and turning water valves. A code of practice for use by all staff is currently being developed in consultation with the regulatory authority, Nova Scotia Transportation and Infrastructure Renewal. ContractorSafety Policy Halifax Water uses the services of contractors on many different fronts when conducting business. This policy has been updated to ensure contractors understand their responsibilities when conducting work for Halifax Water. It includes a prequalification process, monitoring guidelines, and associated documentation. Ongoing review of Halifax Waters Safety Program and communicating this to all staff will further assist with developing a World Class safety culture.
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10.
BUSINESSRISKS&MITIGATIONSTRATEGIES
There are many challenges and opportunities in front of Halifax Water and many more to come as society becomes more aware of the importance of preserving the environment. In recognition of this reality, Halifax Water intentionally elevated the environment to the same level as the customer in its service delivery and entrenched this approach in its mission statement. The path to sustainability for wastewater and stormwater is, however, a difficult journey. The level of investment will require significant increases in funding levels that can only come from external funding programs [federal or provincial] and/or the rate base. With external programs being unpredictable and indeterminate, base funding is more appropriately secured through the rate structure. To that end, Halifax Water will be submitting a rate application for the Urban Core/Satellite systems in January 2013 to cover the 2013/14 and 2014/15 fiscal years to align with the Cost of Service /Rate Design methodology, approved by the NSUARB. As recently directed by the NSUARB, Halifax Water will include the Airport/Aerotech system in the rate application for consideration of consolidation. The rate application is necessary to secure funding to cover projected operating costs and continue to address the utilitys wastewater and stormwater infrastructure deficit and increase capacity for growth. The latter is particularly true for the Airport/Aerotech wastewater system, which must be expanded to service the growth of the Stanfield Halifax International Airport. The utility will also be pursuing a major capital project to facilitate growth with the transfer of wastewater from the Beechville/Lakeside/Timberlea sewer shed to the Halifax sewer shed. The associated rate increases will need to be balanced with fair allocation across the rate base and the ability of the customer to adjust to the new reality of full cost recovery for renewal of infrastructure and protection of the environment. It is recognized that not all customers view protection of the environment as important and Halifax Water will have to increase communication and education to customers on this topic.
10.1 Conservation
Halifax Water will continue to promote water conservation as it is a sustainable practice that will benefit the utility, customers, and the environment in the long run. The promotion of water conservation will be carried out through direct education and partnerships with HRM and other nongovernmental organizations [NGOs], which have proven successful in the past. The environmental stewardship benefits of conservation do, however, have a financial side effect for the utility. Halifax Water has recorded steady decreases in water consumption and expect the trend to continue for quite some time. As detailed in Section 6.2, a projected decrease of 1.5% in consumption per year is incorporated in the five year business plan. The continued downward trend is attributed to customers responding to increasing water and wastewater rates, incorporation of waterefficient fixtures and appliances, and a general
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environmental awareness. If conservation results in a greater decrease in metered sales, the operational revenue projected in the business plan will not be achieved. In an effort to mitigate financial impacts from conservation effects, Halifax Water has established a wastewater rate structure similar to its water rate structure. In this manner, a base charge is tied to customer meter size to recover fixed costs, and a second charge is based on consumption to reflect variable costs. Additionally, the introduction of a separate storm water charge based on impervious area versus water consumption will help further mitigate the financial impacts from conservation.
10.2 NovaScotiaEnvironment[NSE]RegulatoryCompliance
Wastewater A compliance plan [Appendix I] has been developed and updated for each of the Halifax Water wastewater treatment facilities [WWTFs]. The plan outlines the recent performance of each facility in relation to current Nova Scotia Environment [NSE] discharge limits and CCME/WSER requirements. The plan also indicates anticipated enhancements or upgrades required for each facility presently noncompliant, with estimated timeframes. Further work will be required to define the required capital, operating changes, or upgrades to the various facilities, and to develop accurate cost estimates for the required work, which will become part of future capital budgets. Halifax Water meets and communicates regularly with NSE staff, with the objective of achieving consensus on priorities. Regulatory compliance plans are being updated on a continual basis through consultation with NSE. Funding for capital improvements required for a number of the treatment facilities has already been approved, or has been included in the FiveYear Capital Budget, namely: Aerotech [upgrade and expansion], Belmont [decommissioning], Eastern Passage [upgrade and expansion in progress], BeechvilleLakesideTimberlea [upgrade], Lockview MacPherson [optimization], and Wellington [replacement WWTF constructed and commissioned]. The Frame WWTF is currently included within years 6 to 10 of the Capital Budget. Halifax Water intends to utilize operational improvements to achieve compliance for three other facilities Halifax, Dartmouth and North Preston. However, high soluble BOD inputs and prolonged periods of dry weather may pose a compliance challenge for the Halifax facility.
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Water With the recent construction of membrane filtration facilities for three small water systems: Collins Park, Middle Musquodoboit, and Bomont, Halifax Water will remain in compliance with current provincial drinkingwater regulations. In recognition that all watertreatment facilities comply with provincial regulations, maintenance of existing programs and execution of the WQMP will ensure continued compliance. The future focus for the combined utility will be to upgrade and enhance wastewater facilities to ensure environmental compliance. System Assessments Halifax Water is committed to supplying safe and clean water and effective wastewater collection and treatment. In support of these goals, Halifax Water undertakes assessments of all water and wastewater systems, in conformance with NS Environment [NSE] regulations. It is a regulatory requirement that Water System Assessments be completed every five years. Water System Assessment Reports are currently being compiled and will be submitted to NSE by April 1, 2013. Assessments of municipal drinking water systems are conducted to evaluate the capability of the system to consistently and reliably deliver an adequate quantity of safe drinking water; to verify compliance with regulatory requirements; and provide preliminary costs and timelines to address any identified deficiencies and/or concerns. Wastewater Systems Assessments [similar to water system assessments] are currently not a regulatory requirement. However, Halifax Water regularly tests and reports to NSE regarding the performance of some components of the wastewater system for conformance with regulatory requirements. Additionally, Halifax Water completes wet weather flow studies on parts of the wastewater system. These studies are similar to system assessments but are not as comprehensive.
10.3 CCMEWastewaterStrategyandWSERRegulations
On February 14, 2009, the Canadian Council of Ministers of the Environment adopted a national strategy for the management of municipal wastewater. The strategy advocates a riskbased approach to management of wastewater effluent whereby requirements are based on environmental and healthrisk assessments that are to be carried out for all treatment facilities. However, the strategy also includes a prescriptive approach with a requirement for a uniform minimum standard for all effluent equivalent to secondary treatment. Halifax Waters inland treatment facilities that discharge to fresh water already provide secondary or better treatment, as does the Mill Cove facility in Bedford. Construction of the Eastern Passage WWTF is under way with an upgrade from a primary
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to secondary treatment level, but the three Halifax Harbour Solutions Project [HHSP] facilities are advanced primary. Upgrading to secondary level is required for the HHSP facilities under the WSER, with estimated capital costs in the order of $425 M. The upgrade deadlines will likely be 20 years for Halifax and Dartmouth, and Herring Cove, based on risk assessment rankings and the findings of the IRP. A more immediate operational/regulatory issue with Halifax Waters wastewater system is wet weather flow and resultant overflows into the environment as detailed in Section 8.5. Many of the sewers in HRM are combined, built many decades ago with many greater than 100 years in age. Combined sewers have not been permitted in HRM since the early sixties, but even the older, separate sanitary sewers experience very significant I&I problems. Of the approximately 180 wastewater pumping stations owned by Halifax Water, some 40 experience regular overflows. Many of these overflows go to inland receiving waters and, as such, represent higher environmental and health risks than marine discharge of primary treated effluent. As an initial step, a program is underway to provide sensors to detect overflow conditions and estimate volumes for the sanitary sewer overflows. Much of the capital and operating budgets have been allocated to mitigate these wet weather flow problems based on a priorityranking process. It is preferred that resources be allocated based on risk and assessed priority, rather than on the basis of a national standard [the CCME/WSER] that does not consider local conditions. Identification of funding mechanisms and costsharing arrangements with senior levels of government will be critical now that the WSER regulations are in force. To align with the CCME strategy, staff have developed and updated a plan [Appendix H] to ensure compliance with the WSER.
10.4 PensionFundSolvency
The Halifax Water Commission Employees Pension Plan originated in 1972, has 308 participating members, and is a definedbenefit pension plan. After amalgamation of the municipal water utilities in 1996, the Halifax Water Commission pension plan was amended and restated effective June 1, 1998. In the intervening years from 1998 to 2008, eight amendments were made to the plan to maintain and/or improve benefits or to meet regulatory requirements. The plan text has been consolidated as of January 1, 2011, to include these amendments, and the consolidated plan rules were approved by the Halifax Water Board in June of 2011. The Halifax Water Employees Pension Plan and Nova Scotia Pension Benefits Act require that an actuarial valuation is carried out every three years. An actuarial evaluation was conducted as at January1, 2011 [See Table 10.1] and confirms deterioration in the plans financial position, as anticipated with the going concern deficit increasing from $3.9 M to $14.4 M. Consequently, the Halifax Water Board approved an increase in the contribution
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rate effective July 1, 2011, from 9.5% to 10.47%, and the required minimum annual special payments will increase from $445,100 to $1,528,500. On a positive note, however, there is no solvency deficit and an election for solvency relief is not required at this time. Table10.1PensionPlanActuarialResults

Going Concern Surplus/[Deficit] Solvency Surplus/[Deficit] Minimum Total Additional Special Payments Employee Contribution Rate Total Employer Contribution [including current service cost & special payments]

Jan. 1, 2008 Jan. 1, 2011 ($3,898,200) ($14,387,000) $392,400 *$445,100 9.44%, or $904,800 14.82% of payroll, or $1,420,400 $3,342,800 $1,528,500 10.47%, or $1,731,600 20.26% of payroll, or $3,352,800
*$445,100 was the required Minimum Total Additional Special Payment; however Halifax Water was actually contributing a slightly higher amount of $592,500.
10.5 RegionalPlanUpdate
In 2006, HRM Regional Council approved the Regional Plan, which provides guidance on continued and future development in HRM to 2026. As part of the approved plan, HRM committed to undertaking a review every five years to keep the plan current and address necessary adjustments resulting from market changes and other unanticipated external factors. The first fiveyear year review was approved to commence on October 4, 2011 by Regional Council with an anticipated completion by September 2013 [initially September 2012] for suburban and rural areas, with the Regional Centre policies being implemented by 2015. The October 4, 2011 report contains a section on the scope of the Regional Plan. Below is an excerpt from the Plans deliverables that require Halifax Water to dedicate staff time and resources to the various steering committees: a) Policy direction for sustainable suburban and rural community design; optimizing existing services and promoting standards for low impact green design. b) Policy direction for improved suburban and rural community design; improve design standards for sustainable [green], more functional communities.
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c) d) e) f) g) h) i) j)
Policy review for Open Space subdivision standards; Open Space designs may include extension to central water systems. Review Visioning Program for Growth Centers; evaluation of the impact and ability to extend central services. Review growth potential and central servicing for Growth Centres; evaluation of the impact and ability to extend central services. Policy direction for improved rural road standards; review of the rural ditch standards. Policy direction for expansion of CCC program; coordination of water and wastewater CCCs in master planning areas with HRM. Potential Business Park expansion; evaluation of the impact and ability to extend central services. Regional Centre is a focus of the Regional Plan review; evaluation of the impact and ability to extend central services. Policy direction for underground utilities [subdivision bylaw amendment]; amendments to the subdivision bylaw are required to reflect changes in ownership of wastewater infrastructure. Review central servicing of rural growth centres; evaluation of the impact and ability to extend central services. Wastewater Management Districts [maintenance]; HRM is seeking participation from Halifax Water in establishment and/or operation of wastewater management districts. Policy enabling creation of new Regional Centre MPS & LUB [Centre Plan]; participation to ensure appropriate policies are in place relating to system capacities with the redevelopment of lands within the Regional Centre.
k) l)
m)
Along with some of the initiatives above, the Regional Plan will provide a review of service boundaries. A key deliverable identified in the 2006 Plan, to assist both Halifax Water and HRM staff in evaluating the costs associated with some of the identified growth centres, is the Regional Wastewater Functional Plan [RWWFP]. At a master planning level, it will identify system constraints and begin to develop a costing model to determine cost of wastewater servicing in various areas. It may also identify areas where system upgrades are not feasible [financially or regulatory] and should no longer be considered for growth at the anticipated density. The RWWFP will be a valuable tool in evaluating the ability to consider extensions to service boundaries. With the transfer of wastewater assets in 2007, Halifax Water assumed the lead role in the development of the RWWFP, which is expected to be completed in November 2012. The completion of the RWWFP and the IRP have allowed staff to review the concepts of the proposed Availability Charge in relation to the growth anticipated under the Regional Plan. Staff are now proposing a Regional Development Charge to replace the current Regional
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Charges [Sewer Redevelopment Charge, Trunk Sewer Charge and Regional Wastewater Capital Cost Contribution], that will ensure regional infrastructure has been sized adequately for growth. The proposed development and intensification of the Regional Centre will influence the structure and implementation of the proposed Availability or Regional Development Charge. HRM proposes to establish opportunity sites within the Regional Centre so densities can be established and needs associated with both Regional and Local Master Infrastructure can be estimated, managed, and planned within the capitalbudgeting process. The increased growth within Greenfield areas can be managed more effectively amongst HRM and the respective land owners. However, the increased growth in the Brownfield areas of the Regional Centre is proving more challenging. The intentions of the land owners within these opportunity sites are not as predictable, as such, the timing and financial model for upgrades within established corridors cannot be implemented with ease or certainty. This to be established growth through densification increases the risk to Halifax Water as it manages the timing and scope of upgrades to the Regional Centre infrastructure. With clarity around the growth in the Regional Centre, Halifax Water can develop the appropriate funding strategy and right size the proposed Regional Development Charge that will support growthrelated infrastructure requirements.
10.6 DevelopmentPressures/Obligations
HRM, and thus Halifax Water, faces the potential for a strong continued growth pattern. The projected growth will provide challenges for existing infrastructure and require proper planning and phasing for new infrastructure. There are a number of developments that will ultimately contribute flow to the Bedford Highway and Duffus Street wastewater collection systems. The main areas include Bedford West, Mainland North [including the Motherhouse lands near Mount St. Vincent University], Bayers Lake lands, and two futuregrowth areas known as Sandy Lake and Suzie Lake. Ultimate upgrade to these regional wastewater facilities is in the planning stages. The CCC Charge for the Bedford West Master Plan was approved by the NSUARB in September 2012 and Halifax Water has taken the lead on the design and construction of the Kearney Lake Trunk Sewer which will provide the primary wastewater service to the Master Plan Area. The proposed development of the Brunello and Lovett Lake lands within the Beechville, Lakeside, Timberlea area continues to demand a solution to the system capacity constraints at the BeechvilleLakesideTimberlea treatment facility. Pending direction from NSE, Halifax Water will provide the new wastewater capacity via a piped system to the Halifax sewershed. Halifax Water has engaged a Consultant to commence detailed design of the piped solution with construction anticipated in the 2014/15 fiscal year.
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The Halifax International Airport Authority [HIAA] has developed a master plan for the ongoing growth anticipated with the Gateway initiative. The ability to manage the expected discharge created by this growth is uncertain within the current environmental regulations [see Section 10.8 for more detail on the required infrastructure]. In addition to the growth at the HSIA, HRM still has undeveloped lands within the Aerotech Business Park that they would like to develop as fully serviced lots. Until the results of the environmental risk assessment of the receiving waters and further consultation with Nova Scotia Environment are completed, the ultimate servicing solution remains unclear. Halifax Water has recently released an RFP for a consultant to review current plant performance, evaluate options for the treatment of side stream effluent and conduct a predesign for the potential expansion and upgrade of the Aerotech WWTF. With the recent announcement of the Irving national shipbuilding contract, the overall rate of development is expected to increase. This may create a higher demand on the Engineering Approvals division within Engineering & IS and accelerate the development of the master plan areas and associated upgrades to regional infrastructure. These growth scenarios highlight the urgency in finalizing an appropriate Regional Development Charge as part of the Cost of Service/Rate Design Methodology, establishing the costs that can be attributed to new development, and developing a financial model and capital plan for upgrading regional infrastructure. In addition, the anticipated regional growth may accelerate the discussion on the addition of lands to the HRM serviceable boundary. Currently the lands in the Port Wallace area of Dartmouth are the subject of some preliminary watershed studies and appear to be the candidate for next consideration. Also in this discussion are the lands in the Suzie Lake and Sandy Lake areas [watershed study to commence this coming year]. In advance of any new development in these areas, Halifax Water would complete an infrastructure master plan and develop areaspecific Capital Cost Contribution charges. In April 2012, Halifax Water took over the review of the public storm systems from HRM. This will allow more direct input and inspection into the donated assets constructed by developers.
10.7 Biosolids
Biosolids are produced from sludge received from Halifax Waters wastewater treatment facilities. The Harbour Solutions facilities have onsite dewatering; the sludge is dewatered and transported to the Biosolids Processing Facility [BPF] at the Aerotech Park. The upgrade of Eastern Passage WWTF is underway; this facility will also have on site dewatering of sludge. In an effort to reduce Ammonia loading on the Aerotech WWTF; some of the sludge from Mill Cove WWTF is currently being dewatered at Herring Cove
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WWTF and the sludge from Eastern Passage WWTF is being dewatered at Dartmouth WWTF. This operational practice is also cost efficient because it avoids trucking high water content sludge to Aerotech. HW intends to expand the sludge diversion from Aerotech WWTF and dewater the maximum amount of sludge within the close proximity of a WWTF that generates the sludge. The sludge from the remainder of the facilities is transported in liquid/slurry form to a central dewatering facility that is a part of the Aerotech Wastewater Treatment facility. Once dewatered, this sludge is transferred to the BPF. The BPF is operated by a private contractor, NViro Systems Canada LP, who has overall responsibility for operating the facility to produce a soil amendment in conformance with Canadian Food Inspection Agency [CFIA] regulations and further market the product for beneficial use. The sludge from Harbour Solutions facilities are transported by Seaboard Liquid Carriers Limited using specialty trailers whereas the sludge from all other facilities are transported by Halifax Water resources. The contract agreements with NViro and Seaboard are in effect until November 2019 and October 2016, respectively. The contracts allow for fee adjustments based on a formula that takes into account various input costs to operate the BPF. Transportation Contract There are minimal business risks with this contract since there are several other trucking companies that can provide this service as Halifax Water will own the specialty trailers at the end of the current contact. HW has begun negotiations with Seaboard to truck dewatered sludge from Eastern Passage to the BPF at Aerotech Park. The contract may be amended to include transportation of this dewatered sludge. Biosolids Processing The beneficial use of biosolids has been a controversial issue for decades in the province of Nova Scotia and around the world. There are unsubstantiated claims from various sources that land application of biosolids is unsafe. However, the scientific research has proven that the land application is safe and biosolids are a resource that should not be wasted. The Guidelines for Land Application and Storage of Municipal Biosolids in Nova Scotia from Nova Scotia Environment govern Halifax Water operations. However, Halifax Water is faced with the risk of federal, provincial, or municipal authorities either changing the guidelines under public pressure or recommending other alternative technologies to dispose of biosolids. The Canadian Council of Ministers of the Environment [CCME] has also launched an initiative to study the use of biosolids. The CCME Ministers approved the Canadawide Approach for the Management of Wastewater Biosolids on October 11, 2012. The Approach encourages the beneficial use and sound management of biosolids. Beneficial uses include hightemperature limestabilization of biosolids for land application, such as the NViro process currently used by Halifax Water. Nothing in the
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CCME Approach suggests that any change will be required in current biosolids management practices in Nova Scotia, which emphasizes beneficial use. However, the acceptance of the product by the public and the agricultural community continues to be a challenge. Since the facility operation contract is up for renewal in 2019, Halifax Water will have to decide towards the later years of this business plan whether to operate the facility utilizing its own resources or to continue operation through a private contractor. Halifax Water is also exploring the concept of a biosolids/biomass fired cogeneration plant adjacent to the existing BPF in conjunction with the provincial COMFIT program [See Section 7.3.1] Halifax Water has undertaken several steps to ensure the continued safe practice of land application of biosolids: Halifax Water completed an independent peer review of its operations and practices in 2011. This review concluded that the practice is safe and the BPF is being operated in a professional manner. Halifax Water will enhance monitoring controls and promote industry best practices for land application during the span of this business plan. The operating contractor has employed a trained agronomist to liaise with farmers to provide them with information and guidance for land application of biosolids. Halifax Water has developed information brochures and provides regular information through its website to educate stakeholders. Halifax Water works closely with NViro, HRM and Nova Scotia Environment to educate members of the public. Halifax Water will continue to stay abreast of emerging research and technology to further enhance the beneficial use of biosolids. Halifax Water is affiliated with several organizations responding to a recent request for proposals from the Canadian Water Network to conduct research on substances of emerging concern.
10.8 LeachateTreatment
Treatment of Otter Lake landfill leachate at Mill Cove emanated from the original agreement between Mirror Nova Scotia and the Halifax Regional Municipality that contractually bound HRM to assume responsibility for treating leachates from the landfill. Mill Cove, the largest facility at the time, was the logical choice for receiving and treating the liquid. The BeechvilleLakesideTimberlea WWTF was approved by the NSE as an alternate location for the first few years.
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Leachate production at the landfill is affected by the application of daily cover, rainfall, establishment of new cells, etc. Accordingly, deliveries of leachate are directly proportional to rainfall amounts and can sometimes be 24 hrs/day for multiple days resulting in overtime costs for plant coverage. Deliveries arrive via 9000gallon tanker trucks; leachate is deposited directly into a manhole on site that flows by gravity to the onsite Bedford pump station where it is mixed with wastewater from Bedford before being conveyed to the plant. Costs are recovered on a quarterly basis at a rate of 2.88 cents per gallon. Occasionally [once or twice a year] an unknown component of the leachate causes a cloudiness in the effluent resulting in periods of higherthannormal fecal counts. This issue typically does not cause the plant to be out of compliance but decreases the plant buffer should there be any other issues that may impact the effluent quality. The Otter Lake leachate imparts color to plant effluent that causes a decrease in transmittance and, accordingly, an increase in the UV light output required to achieve disinfection. It is difficult to quantify, but it is safe to assume an increase in power consumption. A replacement of the current UV system will be required within the next three years and the color issue may have an impact on the size and cost of the new system. The organic strength of the liquid leachate ranges from 149706 mg/L BOD with the bulk of the samples being in the lower part of that range. Assuming a median value of 300, the population equivalent of the material based on 2010 volumes equates to a population equivalent of 610 people. Receipt of the leachate during rainfall events results in increased truck traffic and traffic at all hours of the night in a residential area. The number of noise complaints is increasing and may continue considering the highend dense development in the immediate vicinity of the plant. The imminent CCME regulations may have an impact on the continuous acceptance of this liquid since the plant may have to free up some capacity to reduce the number of sanitary and combined sewer overflows in these sewersheds. The above issues will remain as long as Halifax Water continues to receive and treat the leachate. Possible mitigation measures available are: Halifax Water could advise HRM that we will no longer be offering the service and that they will need to make alternative arrangements; this may have implications on the HRM contract with the landfill contract operator. HRM Solid Waste is currently in talks with NSE for permission to use the Leachate Treatment Facilities at the Highway 101 Landfill. This facility is owned by HRM and operated by Halifax Water and is the preferred approach for treatment of Otter Lake landfill leachate. Halifax Water will work cooperatively with HRM with a target of successful diversion within the timeframe of this business plan.
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10.9 HarbourSolutionsProjectAssets
The Halifax Harbour Solutions Project [HHSP] is comprised of three advanced primary wastewater treatment facilities: Halifax WWTF; Dartmouth WWTF; and Herring Cove WWTF. The 3 year warranty with the general contractor for these WWTFs expires in 2013, and initiatives are underway for further optimization over the course of the next couple of years. The fine bar screens, at all three facilities were supplied with 10 mm bar spacing. This system is currently being modified so that the bar spacing openings for the main duty screen is reduced from 10 mm to 5 mm, resulting in better capture of screenings, and less negative impact to the Densadeg process and to the Ultraviolet [UV] disinfection system. Associated changes to the SCADA system to support these modifications will be implemented in early 2013/14. The process chemical dosing rates are being examined, and different dosages/concentrations are being tested. As well, alternative suppliers of process chemicals have been sourced and testing begins in early 2013/14. If the results are successful, there is great potential for long term savings. The UV systems in all three facilities, which accounts for the vast majority of the power consumption, are currently flow based. Staff are currently running a trial with a UV transmittance system, which if successful, will be tied into the control system for the UV system, resulting in power savings during times of low flow and low effluent turbidity. At the Halifax plant, a variable frequency drive for a third raw water pump was recently installed for better flow control for optimal treatment performance. The current design of the odour control system [OCS] for each treatment facility does not allow for servicing of main components of the OCS without shutting down the entire odour control system. Over the course of the next 1 3 years, bypass ductwork and the necessary control dampers will be installed on this system to provide the option of keeping main OCS components in operation while other components are being serviced. Manually manipulated stop logs in some process areas are being replaced with automatic penstocks. This will give operations staff better control over various systems such as the upflow clarifiers and the UV systems, during times of low flow rates, and will result in cost savings over the long term.
10.10 AerotechandSmallWastewaterTreatmentFacilities
Aerotech WWTF The existing Aerotech WWTF has a nominal average hydraulic capacity of 1,360 m3/day and a maximum capacity of approximately 2,080 m3/day. The plant is approaching its design limit during dry weather and is challenged in handling peak wet weather flows. It is estimated that plant overflows occur about once or twice per month on average. Overflow durations can be as long as a few days in succession during significant precipitation events.
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With the exception of ammonia, the loads applied to the WWTF are normally below the design loads. The ammonia loads currently exceed the design limits some 20 to 30% of the time. Recent effluent quality data generally indicate that the plant is substantially out of compliance with respect to ammonia. Halifax Water staff have recently taken action to reduce extraneous effluent loading including treatment of Mill Cove sludge at Herring Cove and treatment of Eastern Passage sludge at Dartmouth to improve overall plant performance. New regulations under the Fisheries Act will lead to even more stringent effluent quality standards in the near future, which will further exacerbate plant performance. An environmental risk assessment of the receiving waters is nearing completion in preparation for a future upgrade and expansion. The Aerotech Servicing Study completed in July 2008 provided growth projections for the Airport and Aerotech Park serviced area over a 25year planning horizon. The anticipated wastewater production from the tributary area was estimated to average 3,000 m3/day by 2033. The report identified potential expansion and upgrading options for the WWTF capable of meeting existing and anticipated more stringent effluent requirements. The upgrade to the Aerotech WWTF is currently proposed for 2013/14 and 2014/15 at a concept level cost estimate of $21M. The final project cost will be developed in conjunction with the project preliminary design. External funding opportunities will be sought in conjunction with the preliminary design which will establish the total net cost to Halifax Water and impact on the rate structure. In addition to regular capital project requirements within the wastewater system, a major lagoon dredging and sludge dewatering project is proposed for 2013/14. The Aerotech WWTF receives over 50% of the flow from the HSIA which is owned and operated by HIAA. The related collection system was in poor condition and a significant contributor of I&I. HIAA has been active in 2011 and 2012 to renew wastewater collection assets and Halifax Water will continue to work with HIAA to improve system performance. The plant also serves the Aerotech Business Park owned by HRM. HRM has committed to limit additional development to mitigate further compliance problems until the Aerotech plant is upgraded and expanded. As recommended in a consultant report, the side streams that contribute to the Aerotech WWTF are being investigated with options to divert them to alternative locations to reduce the loading on the plant. A comprehensive accounting of the side streams was performed in 2012/13 and a significant effort was made to decrease side streams by diverting sludge normally dewatered at the Aerotech WWTF to Harbour Solutions WWTFs. In May of 2012, Halifax Water informed septage haulers that their discharge volumes are capped at 2011/12 levels until a more permanent solution is found for treatment of additional volumes. Staff is investigating various strategies to optimize operations to bring the facility into compliance in the short term until such time as the treatment plant can be expanded. The Aerotech Lagoon will be utilized to further equalize flows and thus reduce peak hydraulic
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loading on the plant which will result in reduction of overflows to the receiving water. This effort will also ensure that the plant receives consistent flows thus enabling the plant to treat effluent in a steady state which will help in improving compliance. The system will be fully automated and functional by early 2013/2104. Staff are also paying special attention to ammonia reduction at this facility to enable it to perform up to its design capacity. This optimization exercise will complement an efficient upgrade and expansion strategy. Lockview MacPherson WWTF The Lockview MacPherson WWTF is located in Fall River and was constructed in 1994. It has a treatment capacity of 454 m3/ day and serves both residential and commercial customers. The existing treatment plant processes include grit removal, extended aeration, secondary clarification, filtration, and ultraviolet disinfection. The treatment facility currently experiences problems with the biological process due to excessive flow after heavy rainfall events. There are also ongoing operational and maintenance issues related to the surge tank configuration, the extended aeration process and its ability to address organic loading, and the ultraviolet disinfection system surcharging during heavy storm events resulting in the installation of a chlorinated bypass system. An assessment was conducted in 2012 that included specific recommendations to address these ongoing issues at this facility. Some operational changes are currently being made by staff while a closer analysis of the sewershed flow regime is being conducted. This assessment should be completed by the end of 2012/13. Halifax Water staff, with the assistance of an expert consultant, will continue to optimize this facility over the next two years. The objective is to bring this facility fully into compliance, without the need for a major upgrade, by the end of 2014/15. Frame WWTF Funding is currently in place to construct a new access driveway, construct a new effluent outfall pipe and undertake replacement of minor components of the existing wastewater treatment facility. This work is expected to be completed in 2013. An Environmental Risk Assessment [ERA] of this facility is currently in progress. The outcome of this ERA will provide the necessary criteria in order to undertake a full replacement of this treatment facility. The design/construction of the facility replacement is expected to proceed in 2014/15 and 2015/16 for an estimated cost of $3.3M. Springfield Lake WWTF A recent capital works project was carried out which saw the twinning of a section of force main to alleviate wet weather surcharges which necessitated ongoing intervention by wastewater collections staff. Further efforts will be made to reduce wet weather I&I to improve conveyance with implementation of the SIR program to reduce extraneous
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stormwater. Long term plans envision a future connection to the Sackville trunk sewer, subject to system improvements to reduce I&I in the Sackville System. Uplands WWTF There is no planned capital work at this facility during the next five years. Wellington WWTF The replacement of the Wellington WWTF is currently funded and nearing completion to treat effluent to the new regulations associated with the CCME Strategy. There is no other planned capital work for this facility during the next five years. Middle Musquodoboit WWTF There is no planned capital work at this facility during the next five years. North Preston WWTF The North Preston facility was originally constructed in 1988 as a rotating biological contractor [RBC] plant; in 2007, the facility was upgraded and expanded, with a change to sequence batch reactor [SBR] technology complete with UV disinfection and tertiary wetland treatment. In 2010, a new headworks building was added to provide screening of the influent flow. The facility has worked very well but still has a few challenges; they are listed below along with the mitigation strategies: The facility is required under its permit to attain a minimum pH of 6.5 in the effluent. In the past, it was difficult to consistently meet this requirement as the facility design did not incorporate any means of pH control. Equipment for pH control was installed recently by Halifax Water staff and results to date are very promising. Design average daily flow at the North Preston facility is 680 m3/day, and plant records for 2011 to the end of October indicate an average daily flow of 917 m3/day. The data suggests that I&I is the source of excess flows. Plant performance data is relatively good given the high flows but would be better if influent flow rates were brought more in line with plant design. The influent pump station conveying flow to the plant has been modified to increase the flow capacity of its pumps. The capacity increase has caused a surcharge on the line feeding the plant headworks resulting in unscreened wastewater entering the SBR feed tank. The screenings then accumulate in the SBR tankage necessitating unit shutdowns for cleaning. Staff are evaluating the hydraulic grade line to determine if sufficient head exists to allow
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an increase in height of the overflow weir. If sufficient head does not exist, the pumping rates may need to be lowered and/or a variable frequency drive [VFD] added. Other than noted above, there is no planned capital work at this facility during the next five years.
10.11 EnergyCosts
Through its Energy Management Program, Halifax Water has committed to creating and ensuring an ongoing focus on sustainability and energy efficiency throughout the utility, including Water and Wastewater operations. This new program serves to define the goals, objectives, accountabilities, and structure for activities related to sustainability and responsible energy use. The Water and Wastewater/Stormwater departments operating budgets are significantly impacted by energy costs which are expected to increase over the life of this business plan and beyond. Table 10.2 provides projected energy costs over the next five years:

Table10.2ProjectedEnergyCostIncreases&BudgetImpacts
Year 2013/14 2014/15 2015/16 2016/17 2017/18

Electricity 8.3% 10% 10% 10% 10%
NaturalGas 5.3% 3.5% CPI CPI CPI
FuelOil 10% 10% CPI CPI CPI
Water Budget Impact($) $177,000 $230,000 $240,000 $265,000 $290,000
Wastewater Budget Impact($) $352,000 $450,000 $476,000 $523,000 $575,000
Total Budget Impact($) $529,000 $680,000 $716,000 $788,000 $865,000
A CPI Factor of 2% has been used to calculate the above projected budget impacts.
The Energy Management Action Plan identifies energyreduction targets for Water and Wastewater Operations over a fiveyear planning period. Targets will be reviewed each year and adjusted for future years based on the previous years performance, future years operating and capital budget constraints, and anticipated energy price increases. Water and Wastewater Operations energyreduction targets over the next five years are outlined in Table 10.3:
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Table 10.3 Energy Reduction Targets Year 2013/14 2014/15 2015/16 2016/17 2017/18 Water Operations Projected Savings Energy Energy Reduction Savings Target (kWh) 2.0% 450,000 2.0% 440,000 2.0% 435,000 2.0% 425,000 2.0% 417,000 Wastewater Operations Projected Savings Energy Energy Reduction Savings Target (kWh) 2.0% 895,000 2.0% 880,000 2.0% 860,000 2.0% 845,000 2.0% 825,000
Presently the fiveyear Business Plan operating budgets do not incorporate the energy reduction targets outlined in Table 10.3. As future electricity rates become known with greater certainty and the energy savings of various initiatives are measured, budgets will be adjusted on an annual basis. The projected savings shown above are also contingent on the availability of human and capital resources as approved in the annual operating and capital budgets. As capital budgets are approved, actual energy savings may need to be adjusted on an annual basis. To date, a number of potential energymanagement opportunities [EMOs] have been identified through low to midlevel energy audits in a number of facilities. For Water Operations, EMOs include HVAC system upgrades; retrocommissioning of PRV station HVAC systems; lighting retrofits; reactive power correction; variable frequency drive upgrades; pumping system performance upgrades; and new construction design review for energy efficiency. For Wastewater Operations, EMOs include effluent stream heat recovery; retro commissioning of pumping station HVAC systems; UV disinfection system upgrades; lighting retrofits; reactive power correction; variable frequency drive upgrades; and new construction design review for energy efficiency. A number of these EMOs have been successfully implemented, and some have been partially funded through Efficiency Nova Scotias various programs. A number of new construction projects are also being evaluated for energy efficiency improvements. Projects include the new Eastern Passage Wastewater Treatment Facility [area classification/HVAC improvements, lighting upgrades, and improved aeration blowers and their associated control systems], the Bedford West Trunk Sewer and Pumping Station Upgrade [pump system efficiency improvements, area
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classification/HVAC improvements, lighting, VFDs, motors, etc.] , and the Lakeside/Bayers Lake PS Upgrade [pump system efficiency improvements, area classification/HVAC improvements, lighting, VFDs, motors, etc.]. Energy efficiency is now an integral part of the overall project evaluation and design process, ensuring cost effective, economical efficiency improvements at the design and construction phase of a given project. A number of Halifax Waters standard design specifications have also been reviewed to ensure energy efficiency is taken into account in any future new construction activities [e.g., wastewater pumping stations, booster stations, treatment plants].
10.12 ExternalFunding
The Municipal Rural Infrastructure Fund and Canada Strategic Infrastructure Fund are now closed, as are economic stimulus programs. The only financial support available from the senior levels of government is currently the Gas Tax Fund program. Water, wastewater, and stormwater projects are eligible for this funding; however, the Halifax Regional Municipality also faces pressing infrastructure challenges and, from a policy perspective, is allocating Gas Tax Fund money to municipal projects with the expectation that water, wastewater, and stormwater projects should be funded by the residents receiving the services, i.e., through rates. There is P3 funding available under the Build Canada program, but only feasible for very large projects and is more appropriate in an unregulated environment. Halifax Water does not have projects within the five year capital plan that would be suitable candidates. The Federation of Canadian Municipalities and its Big City Mayors Caucus are actively advocating for future infrastructure programs dedicated to addressing costs driven by regulations associated with the CCME municipal wastewater effluent strategy. The Halifax Regional Municipality and Halifax Water are working together to support these activities through provision of data. It is anticipated the 2013 Federal Budget may contain infrastructure funding announcements. Halifax Water has identified the Aerotech Wastewater Treatment Facility Upgrade as the top candidate for potential infrastructure financing if a program is available. This would reduce the debt financing requirement for this project which would reduce projected debt servicing in the final years of the five year plan.
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11.
RECOMMENDATIONSFORRATEAPPLICATIONS
11.1 UrbanCore,Airport/Aerotech,andSatelliteSystems
In recognition that Halifax Water incurred an operating loss in 2011/12 and is projecting a loss in 2012/13, and the years 2013/14 to 2017/18, the two year rate application that will be filed with the NSUARB in January 2013 will need to address the following objectives. 1) Providing sufficient operating revenue for the 2013/14 and 2014/15 fiscal years to cover the operating and nonoperating costs for water, wastewater, and stormwater services as contained in the Business Plan 2) Providing sufficient operating revenue to accommodate increasing depreciation. 3) Provide rate stability to commence delivery of the Integrated Resource Plan to address the infrastructure deficit and regulatory compliance issues facing the utility. 4) The Business Plan and rate application include an annual increase in customer base of 938 customer connections divided between domestic, industrial, commercial, multiresidential and institutional based on the average increase over the past few years. 5) A 1.5% reduction in the annual volume of water sold, recognizing conservation more than offsets the volume increases due to new customers. The proposed application will be the first made under the new cost of service/ rate design, and will be for a consolidated system that includes the Aerotech/Airport, Urban Core & Satellite Systems. Recommendations for the proposed Rate Application will be presented to the HRWC Board in December 2012.
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AppendixA
Mission,Vision&CorporateBalancedScorecard
4'r 4C.J Halifax 1 Water

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t ilJf Halifax i i Water

Our Mission:
To provide world class services for our customers and our environment
Our Vision:
We will provide our customers with high quality water, wastewater, and stormwater services. Through adoption of best practices, we will place the highest value on public health, customer service, fiscal responsibility, workplace safety and security, asset management, regulatory compliance, and stewardship of the environment. We will fully engage employees through teamwork, innovation, and professional development.
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ICY Halifax Water
Measuring Performance through a Corporate Balanced Scorecard
Presented to Halifax Water Board, May 31, 2012
1,4
Background of Corporate Balanced Scorecard
HRWC embarked on a Continuous Improvement Program in 1999 In 2000, HRWC looking for methodology to measure organizational performance that was meaningful Introduced to concept of Corporate Balanced Scorecard [CBS] through association with Bridgeport Hydraulics, Connecticut HRWC Board approved CBS in 2001 and Organizational Award Program on March 28, 2002 CBS ensured all employees focused on strategic outcomes After the wastewater merger on August 1/07, recognition that CBS should be expanded to include wastewater/stormwater performance measures and opportunity to recalibrate water measures
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The Process
In late fall 2007, struck a steering committee and selected a group of forty employees to review the utility mission, vision and develop expanded scorecard Good cross section of employees representing all departments, all levels, union and management [front line to General Manager] Three steering committee meetings and two staff workshops held with facilitation by an outside consultant, Jack Duffy
www.halifaxwater.ca
The Process
Developed a new mission statement which had to change as a result of the merger in 2007 Identified critical success factors [CSFs] in support of the new mission Developed organizational indicators [OIs] to measure performance Received approval of the revised CBS from the Halifax Water Board and a revised organizational award program on March 6, 2008 [annual approval]
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The Mission of Halifax Water
www.halifaxwater.ca
The Vision of Halifax Water
iM
We will provide our customers with high quality water, wastewater, and stormwater services. Through adoption of best practices, we will place the highest value on public health, customer service, fiscal responsibility, workplace safety and security, asset management, regulatory compliance, and stewardship of the environment. We will fully engage employees through teamwork, innovation, and professional development.
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Critical Success Factors
High Quality Drinking Water Service Excellence Responsible Financial Management Effective Asset Management Workplace Safety and Security Regulatory Compliance Environmental Stewardship Motivated and Satisfied Employees
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Organizational Indicators
Organizational Indicators (OIs) are the measures of our performance within each CSF and provide the definition and detail to best understand them. The OIs are organizational, not individual measures. The OIs provide both a detailed clarification of the CSF and allow a target or goal for performance to be established and tracked.
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Organizational Performance Award Program
Based on a subset [12] of our strategic OIs which are the most objective. Program pays for itself by meeting operating expense to revenue ratio target; ratio is reduced from approved budget to accommodate the award program potential. It is not a given; a threshold of 7.0 in scoring must be reached in a given year. To be eligible for the award, employees must work a minimum of nine months during the fiscal year [April 1st to March 31st]
www.halifaxwater.ca
The CBS Targets for 2012/13 Fiscal Year
Organizational Indicators with a star * are tied to the Award Program
www.hrwc.ca
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CSF: High Quality Drinking Water
Organizational Indicators:
Adherence with 5 objectives from the Water Quality Master Plan for all water systems; we must own system for one year to include results [target of 90% adherence] Bacteriological tests [Monthly target of 99.3% free of Total Coliform] Customer satisfaction about water quality [Target of 85% rating water quality as good to excellent]
www.halifaxwater.ca
11
CSF: Service Excellence
External customer survey about service [Target of 90% satisfied or very satisfied with service] Service outages of water [Target of 200 connection hours / 1000 customers] Service outages of wastewater [Target of10 connection hours / 1000 customers]. (N.B. the clock starts after we know it is our system) Average call wait time over the year [Target of 70 seconds]
www.halifaxwater.ca
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CSF: Responsible Financial Management
Operating Expense/Revenue ratio [Target of 0.812 from approved 2012/13 budget] Annual Cost per connection [$404 per connection-Water]; target is 3% less than 2012/13 budget Annual Cost per connection [$650 per connection -Wastewater and Stormwater]; target is 3% less than 2012/13 budget
www.halifaxwater.ca
13
41Halifax Water
CSF: Effective Asset Management
Target leakage allowance of 185 litres per service connection per day [IWA performance measure] Inflow and Infiltration [I&I]; Target of 250 inspections of private property in relation to discharge of stormwater into the wastewater system [SIR Program] Reduction of CSO and SSO events per year [CCME MWES parameter] Note: The inventory of CSO and SSO locations has been compiled; 2012/13 will see further inroads with instrumentation and targets will be established in the future % of budgeted projects completed within water distribution and wastewater collection systems [Target of 90% completed based on 10.229 million for 2012/13]
www.halifaxwater.ca
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CSF: Workplace Safety & Security
# of NS labour infractions resulting in a written order [Target of zero with maximum of 2 per year] lost time accidents [# of accidents resulting in lost time per 100 employees [Target of 3 per 100 employees] # of traffic accidents per 1,000,000 km [Target of 4 with maximum of 5] Employees are retrained or recertified before due date [Target maximum of 100% with minimum of 90%] Supervisors complete weekly or bi-weekly Safety Talks [Target maximum of 95% with minimum of 85%]
CSF: Regulatory Compliance
# of public health and environmental regulatory infractions resulting in a written order. [Target of zero with maximum of 2 per year]
% of samples taken at all Halifax Water WWTFs complying with the NSE discharge limit for all parameters. [Target of 85% compliance] Percentage of water supply plants meeting product regulations of their permits; we must own system for one year to include as a measure. [Target of 100% compliance]
www.halifaxwater.ca
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Environmental Stewardship
Organizational Indicators
Target of 400 ICI properties in HRM inspected by Pollution Prevention [P2] section per year Energy management [kwh]; Target of 1.5% reduction from base levels for water and wastewater projects Bio-solid residuals handling; Percentage of sludge meeting solids concentration target [Target of 96 % of samples meet a minimum solids concentration of: HHSP 25%, Aerotech Dewatering Facility 18%]
www.halifaxwater.ca
17
CSF: Motivated and Satisfied Employees
# of arbitrations divided by total # of grievances. [Target of 0 Arbitrations] % of jobs filled from within HW (excluding entry level jobs). [Target of 80%] Employee satisfaction survey [Target of A- rating from internal survey; benchmark of B established in 2009]. Average number of days of absenteeism. [Target of < 6 days]
www.halifaxwater.ca
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Summary
The track record of the CBS at Halifax Water has been very positive; it has made us a better utility. The CBS process continues to be an inclusive and consensus building exercise for employees. Staff obtains Board approval of the Organizational Award Program on an annual basis Organizational Award Program funding is available by meeting the Operating Expense to Revenue Ratio Target. The Organizational Award Program is not a given; the organization must score at least 7.0 to have an award. Financial targets are consistent with approved annual operating budget.
January 9, 2013
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10
AppendixB
OrganizationalChart
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January 9, 2013
Page 395
HALIFAX WATER
COMMISSIONER Vacant COMMISSIONER Mayor Mike Savage CHAIR Colleen Purcell VICE CHAIR Russell Walker COMMISSIONER Rick Paynter COMMISSIONER Tony Charles
COMMISSIONER Richard Butts
COMMISSIONER David Hendsbee
COMMUNICATIONS & PR COORDINATOR James Campbell 490-4604
GENERAL MANAGER Carl Yates 490-4840
ADMIN ASSISTANT II Sandy Hood 490-6207
DIRECTOR ENVIRONMENTAL SERVICES John Sheppard 490-6958
DIRECTOR ENGINEERING & INFORMATION SERVICES Jamie Hannam 490-4804
DIRECTOR WASTEWATER & STORMWATER SERVICES Susheel Arora 490-6254
DIRECTOR WATER SERVICES Reid Campbell 490-4877
DIRECTOR HUMAN RESOURCES Eric Rowley 490-6930
DIRECTOR FINANCE & CUSTOMER SERVICE Cathie OToole 490-3572
ADMIN ASSISTANT Jeannie Fraser 490-6950 MANAGER, WATER INFRASTRUCTURE, ENGINEERING Tom Gorman 490-4176
ADMIN ASSISTANT Nola Button 490-6204
ADMIN ASSISTANT Melissa White 490-4271 TREATMENT FACILITIES SUPERINTENDENT Rick Reid 832-5875 SUPERINTENDENT, WATER SUPPLY PLANTS Garry Oxner 869-4303
ADMIN ASSISTANT Karen Gardiner 490-4835 OFFICE ASSISTANT II Trish Simms* Trish Jodrey 490-4098 HR COORDINATOR Rochelle Bellemare 490-4807
ADMIN ASSISTANT Lorna Skinner 490-6208
JAMES SPURR Corporate Legal Counsel 490-6101
MANAGER REGULATORY COMPLIANCE Tony Blouin 490-1814
WEST REGION SUPERINTENDENT Ken MacDonald 490-4107
MANAGER POLLUTION PREVENTION John Sibbald 490-5527
MANAGER, WASTEWATER/ STORMWATER INFRASTRUCTURE ENGINEERING WEST/CENTRAL David Ellis 490-6716
EAST REGION SUPERINTENDENT Sheldon Parsons 490-1781
ADMIN ASSISTANT Carol White 832-8631
MANAGER OF CUSTOMER SERVICE & METERING Debby Leonard 490-4995
LAKE MAJOR PLANT SUPERVISOR Colin Waddell 435-8300
WATER QUALITY MANAGER Alisha Knowles 869-0171
CONTROLLER Cheryl Little 490-6937
MANAGER ENVIRONMENTAL ENGINEERING Charles Lloyd 490-6942
MANAGER SAFETY AND SECURITY Pat Bellemare 490-6104
MANAGER ASSET MANAGEMENT WASTEWATER/ STORMWATER Val Williams 490-6946
CENTRAL REGION SUPERINTENDENT Danny Patey 490-2004
HALIFAX HARBOUR SOLUTIONS FACILITIES SUPERINTENDENT Rory MacNeil 490-1881
WATERSHED MANAGER Barry Geddes 869-4304
J.D. KLINE PLANT SUPERVISOR Peter Flinn 835-2628
OFFICE ASSISTANT Monica St.Croix 490-6210
MANAGER, WASTEWATER/ STORMWATER INFRASTRUCTURE ENGINEERING EAST Ian Guppy 490-5212
FLEET MAINTENANCE & BUILDINGS SUPERVISOR Peter White 490-5919
WEST DISTRIBUTION OPERATIONS SUPERINTENDENT Barry McMullin 490-6102
CENTRAL DISTRIBUTION OPERATIONS SENIOR SUPERVISOR Tim Burbine 869-4341 EAST / BENNERY DISTRIBUTION OPERATIONS SUPERINTENDENT Peter Jensen 490-4975
TECHNICAL SERVICES SUPERVISOR Graham MacDonald 869-4338
MANAGER, ENGINEERING APPROVALS Kenda MacKenzie 490-5029
ENGINEERING INFORMATION MANAGER Harold MacNeil 490-6234
INFORMATION SERVICES MANAGER Dayalan Pillay 490-6921
Updated: December 2012
MANAGER ENERGY EFFICIENCY Jeffrey Knapp 490-5736
January 9, 2013
Page 396
AppendixC
WaterandWastewaterServiceDistricts andSupportingInfrastructure
thk Halifax 1 1 Water

January 9, 2013
Page 398

Springfield WWTF e it
-41
Fall River (LockviewlMacPherson) s WWTF Beavdirba k Fail River Systems Outside Map Limits - Collins Park Water System - Middle Musquodoboit Water Et Wastewater - Wellington Subdivision Wastewater System - AirportlAerotech Water Et Wastewater - Bomont Water System
Middle r%a 3cile Windsor Junction Miller Lake Water System Waverley
p
JD Kline Water Treatment Plant (Pockwock) Lucasvill
Frame Subdivision WWTF Lakeview Central Water Operations Depot
North Preston WWTF
Hammonds Plains
*Central Wastewater Operations Depot
Fe"' i Lake Major Treatment Plant East Preston
Uplands P WWTF Bedford Basin
4V Burnside Vilirgerrybrook
Cole Harbour Five Island Lake Water System
"WrRAL REGA9N WES T REGIoN

artmout
VVWTF
Ed5 Was Op East Water Operatic Depot
Timberlea LakesidelTimberlea
WWTF
Halifax \
WWTF
Lakeside Asa_ Beechville
Belmont .011WWTF Eastern Pass

WWTF
Cow Bay Silversands Water System Eastern Passage
Water & Wastewater Service Districts and Supporting Infrastructure

Water Service District Wastewater Trunk System
West Water perations Halifax of and Harbour Administration Oqice Fergusons Spryfiel Cove
LIS
January 9, 2013
Wastewater Service District Common District Wastewater Treatment
Water Treatment Water Reservoir Water Distribution System

Herring C
WWTF
Primary Wastewater Pumping Station
* Operations Depot
Herring Cove
Atlantic Ocean
Page 399
AppendixD
ApprovedCapitalBudget 201213
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January 9, 2013
Page 401
HALIFAX WATER
Capital Budget 2012/13 Summary
Asset Category
Project Costs
Water - Transmission -- T O T A L Water - Distribution -- T O T A L Water - Structures -- T O T A L Water - Treatment Facilities -- T O T A L Water - Energy -- T O T A L Water - Fleet -- T O T A L Water - IT -- T O T A L Water - Security -- T O T A L Water - Equipment -- T O T A L
$7,413,000 $4,163,000 $4,410,000 $542,000 $450,000 $250,000 $974,000 $50,000 $65,000
TOTAL - Water
$18,317,000
Wastewater - Trunk Sewers -- T O T A L Wastewater - Collection System -- T O T A L Wastewater - Forcemains -- T O T A L Wastewater Structures -- T O T A L Wastewater - Treatment Facility -- T O T A L Wastewater - Energy -- T O T A L
Page 1 of 12
$1,350,000 $1,828,000 $2,320,000 $5,783,000 $26,834,000 $1,100,000
January 9, 2013
Page 402
HALIFAX WATER
Capital Budget 2012/13 Summary
Asset Category
Project Costs
Wastewater - Fleet -- T O T A L Wastewater - IT -- T O T A L Wastewater - Security -- T O T A L Wastewater - Equipment -- T O T A L
$1,000,000 $1,244,000 $150,000 $109,000
TOTAL - Wastewater
$41,718,000
Stormwater - Pipes -- T O T A L Stormwater - Culverts -- T O T A L
$1,438,000 $455,000
TOTAL - Stormwater
$1,893,000
Aerotech- Wastewater -- T O T A L Aerotech- Water -- T O T A L
$285,000 $250,000
TOTAL - Aerotech
$535,000
GRANDTOTAL
I
$62,463,000
January 9, 2013
Page 2 of 12
Page 403
HALIFAX WATER
Capital Budget 2012/13 Water Schedule 1
Project Name
Project Cost
Water - Transmission
Bedford South CCC - Nine Mile Drive Extension Bedford South Transmission Main Oversizing - Non CCC Bedford West CCC - Various Phases Twin Brooks Phase 2 Transmission Main Oversizing - Non CCC Governor's Brook Phase 3 Oversizing Integrated Resource Plan (50/50 split W/WW) Asset Management Implementation Program (1/3 split W/WW/SW) Dunbrack Transmission Main Sliplining Phase 2 $35,000 $40,000 $10,000 $110,000 $65,000 $165,000 $88,000 $6,900,000
Water - Transmission -- T O T A L Water - Distribution

Chandler Drive Waverley Road Bridge Water Main Replacement Lawnsdale Drive Water Main Renewal (Integrated) Pine Street Water Main Renewal (Integrated) Mountain Drive Water Main Renewal (Integrated) Carver St Service Lateral Relocation Bayers Rd Water Main Renewal (Integrated) Kingfisher Crescent Water Main Renewal (Integrated)
January 9, 2013
Page 3 of 12
$7,413,000
$284,000 $75,000 $373,000 $433,000 $198,000 $56,000 $315,000 $222,000

Page 404
HALIFAX WATER
Project Name
Project Cost
CNR Bridge @ Quinpool Road (integrated) Plateau Cr Water Main Renewal (Integrated) Willow Street Water Main Renewal (Integrated) Pleasant Street ~ Valves ~ Hydrants ~ Service Lines ~ Meter Program ~ Denotes Blanket approval
$81,000 $419,000 $125,000 $167,000 $50,000 $75,000 $240,000 $1,050,000
Water - Distribution -- T O T A L Water - Structures

CSE Retrofit - Arkerley Reservoir Chamber Cowie Hill Road Extension Cowie Hill Facility - Furniture Cowie Hill Operations Facility
$4,163,000
$35,000 $250,000 $125,000 $4,000,000
Water - Structures -- T O T A L
$4,410,000
January 9, 2013
Page 4 of 12
Page 405
HALIFAX WATER
Project Name
Project Cost
Water - Treatment Facilities

Miller Lake Small System - Extension of Well Supply Line J D Kline - Chemical Feed Pump Replacement Program J D Kline - Chlorination System Replacement Design Lake Major WSP - Control Room Renovations Lake Major WSP - Lime System Upgrade Lake Major WSP - Ventilation in Motor Control Room $250,000 $120,000 $100,000 $14,000 $38,000 $20,000
Water - Treatment Facilities -- T O T A L Water - Energy

Heat Recovery Study and Upgrade JD Kline - Raw Water Supply Pump Energy Study PRV Energy Recovery Pilot Project - Orchard Central Chamber
$542,000
$300,000 $50,000 $100,000
Water - Energy -- T O T A L Water - Fleet

~ Fleet Upgrade Program
$450,000
$250,000
Water - Fleet -- T O T A L
$250,000
January 9, 2013
Page 5 of 12
Page 406
HALIFAX WATER
Project Name
Project Cost
Water - IT
~ Desktop Computer Replacement Program (50/50 split W/WW) SCADA Control System Upgrades SCADA Master Plan Implementation (50/50 split W/WW) ~ Network Infrastructure Upgrades (50/50 split W/WW) IT Program Computerized Maintenance Management System (50/50 split W/WW) $130,000 $50,000 $594,000 $100,000 $50,000 $50,000
Water - IT -- T O T A L Water - Security

Security Upgrade Program
$974,000
$50,000
Water - Security -- T O T A L Water - Equipment

~ Survey Equipment (50/50 split W/WW) ~ Power Meter/Data Logger (50/50 split W/WW) ~ Scissor-Lift Equipment - Lake Major WSP ~ Miscellaneous Equipment Replacement
$50,000
$10,000 $5,000 $20,000 $30,000
Water - Equipment -- T O T A L
$65,000
GRAND TOTAL - WATER
$18,317,000
January 9, 2013
Page 6 of 12
Page 407
HALIFAX WATER
Capital Budget 2012/13 Wastewater Schedule 2
Project Name
Project Cost
Wastewater - Trunk Sewers

CN Quinpool Bridge Structure - Replacement of 450mm Combined Sewer Bedford West (CCC) $100,000 $1,250,000
Wastewater - Trunk Sewers - -- T O T A L Wastewater - Collection System

Integrated Wastewater Projects - Program Integrated Resource Plan (50/50 split W/WW) Springfield Lake Collection Upgrade Outfall Elimination Program Asset Management Implementation Program (1/3 split W/WW/SW) Grit Management Facility Bedford West Collection System (CCC)
$1,350,000
$1,250,000 $165,000 $150,000 $100,000 $88,000 $60,000 $15,000
Wastewater - Collection System -- T O T A L Wastewater - Forcemains

Bayers Lake Forcemain Upgrade & Twinning Cathodic Protection Program (Various Locations) Bedford West - FM Design to redirect WW (Holyhock PS) from Mill Cove to Halifax
$1,828,000
$2,160,000 $150,000 $10,000
Wastewater - Forcemains -- T O T A L
$2,320,000
January 9, 2013
Page 7 of 12
Page 408
HALIFAX WATER
Project Name
Project Cost
Wastewater - Structures
Wastewater Pumping Station Upgrade Program - West Region Wastewater Pumping Station Upgrade Program - East Region Wastewater Pumping Station Upgrade Program - Central Region Quigley's Corner Pump Replacement and PS Upgrade Balcome Drive PS Cowie Hill Road Extension Cowie Hill Facility - Furniture Cowie Hill Operations Facility $133,000 $125,000 $100,000 $300,000 $750,000 $250,000 $125,000 $4,000,000
Wastewater Structures -- T O T A L Wastewater - Treatment Facility

Eastern Passage WWTF Design Build Upgrade Beechville, Lakeside, Timberlea WWTF Upgrade Lockview-MacPherson WWTF - Tertiary Upgrade Wastewater Treatment Facilities Upgrades (Various Locations) - Mill Cove WWTF - Uplands Park WWTF - Halifax WWTF - Dartmouth WWTF
$5,783,000
$20,000,000 $5,000,000 $150,000 $135,000 $50,000 $50,000 $290,000 $180,000
January 9, 2013
Page 8 of 12
Page 409
HALIFAX WATER
Project Name
Project Cost
HHSP Deficiency Management N-viro Facility - Upgrade Program Frame WWTF Replacement Dartmouth HHSP ARV's
$500,000 $359,000 $100,000 $20,000
Wastewater - Treatment Facility -- T O T A L Wastewater - Energy

Roach's Pond PS HVAC Study/Upgrade DWWTF Heat Recovery System Study HCWWTF Heat Recovery System Study Herring Cove WWTF - Ventilation Air Heat Recovery Mill Cove WWTF - Reactive Power Correction Mill Cove WWTF - Lighting Upgrades
$26,834,000
$250,000 $50,000 $50,000 $600,000 $50,000 $100,000
Wastewater - Energy -- T O T A L Wastewater - Fleet

~ Fleet Upgrade Program
$1,100,000
$1,000,000
Wastewater - Fleet -- T O T A L Wastewater - IT

~ Network Infrastructure Upgrades (50/50 split W/WW) ~ Desktop Computer Replacement Program (50/50 split W/WW)
$1,000,000
$100,000 $130,000
January 9, 2013
Page 9 of 12
Page 410
HALIFAX WATER
Project Name
Project Cost
SCADA Master Plan Implementation (50/50 split W/WW) GIS Migration & Development IT Program Computerized Maintenance Management System (50/50 split W/WW) EMS Software
$594,000 $250,000 $50,000 $50,000 $70,000
Wastewater - IT -- T O T A L Wastewater - Security

Security Upgrade Program
$1,244,000
$150,000
Wastewater - Security -- T O T A L Wastewater - Equipment

~ Survey Equipment (50/50 split W/WW) ~ Asphalt Roller ~ Tri-axel Trailer ~ Power Meter/Data Logger (50/50 split W/WW) ~ SIR Program Flow Meters
$150,000
$15,000 $15,000 $30,000 $5,000 $44,000
Wastewater - Equipment -- T O T A L
$109,000
GRAND TOTAL - WASTEWATER
$41,718,000
January 9, 2013
Page 10 of 12
Page 411
HALIFAX WATER
Capital Budget 2012/13 Stormwater Schedule 3
Project Name
Project Cost
Stormwater - Pipes
Integrated Stormwater Projects - Program Drainage Remediation Program Surveys/Studies Deep Storm Sewer Installation Program Asset Management Implementation Program (1/3 split W/WW/SW) $500,000 $50,000 $800,000 $88,000
Stormwater - Pipes -- T O T A L Stormwater - Culverts/Ditches

Leeward Avenue - Ditch Regrading and Rock Breaking Lucasville Road Culverts Replacements Diana Drive Stormwater Modifications Spruce Grove Court to Daisy Drive - Drainage Swale 561 Herring Cove Road, Culvert Replacement
$1,438,000
$70,000 $180,000 $50,000 $50,000 $105,000
Stormwater - Culverts/Ditches -- T O T A L
$455,000
GRAND TOTAL - STORMWATER
$1,893,000
January 9, 2013
Page 11 of 12
Page 412
HALIFAX WATER
Capital Budget 2012/13 Aerotech Schedule 4
Project Name
Project Cost
Wastewater
Aerotech Wastewater Treatment Facility Upgrade - Detailed Design Aerotech Wastewater Treatment Facility Upgrades $250,000 $35,000
Wastewater -- T O T A L Water
Water Treatment Plant Upgrades Distribution System Upgrades
$285,000
$140,000 $110,000
Water -- T O T A L
$250,000
GRAND TOTAL - AEROTECH
$535,000
January 9, 2013
Page 12 of 12
Page 413
AppendixE
ProjectedCapitalBudgetsfor 201314to201718
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January 9, 2013
Page 415
Five Year Capital Budget
All $ in 000's Y1 2013-2014 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Stormwater / Wastewater / Water Budget Summary

Stormwater - Pipes Stormwater - Culverts/Ditches Stormwater - Structures Stormwater - Fleet Stormwater - IT $1,913 $811 $231 $249 $431 $3,635 $200 $5,595 $1,843 $12,879 $34,211 $840 $994 $1,449 $200 $150 $58,361 $61,996 $15 $12,305 $5,855 $3,925 $2,275 $740 $252 $1,630 $50 $60 $27,107 $5,429 $825 $575 $201 $331 $7,361 $150 $7,199 $625 $10,456 $4,588 $1,340 $804 $2,378 $200 $135 $27,875 $35,236 $215 $1,214 $6,890 $1,485 $2,395 $550 $457 $2,459 $50 $60 $15,775 $3,473 $500 $0 $245 $323 $4,541 $3,805 $14,201 $240 $20,525 $9,583 $590 $980 $1,694 $200 $135 $51,953 $56,494 $215 $9,806 $8,272 $7,551 $10,912 $440 $424 $1,767 $50 $76 $39,514 $8,408 $500 $0 $212 $198 $9,318 $6,545 $14,752 $1,222 $13,999 $22,651 $590 $846 $992 $200 $145 $61,942 $71,260 $15 $19,093 $8,272 $8,456 $7,398 $440 $507 $1,190 $50 $59 $45,480 $7,495 $663 $0 $202 $158 $8,518 $10,445 $11,865 $3,573 $15,785 $20,050 $590 $806 $732 $200 $145 $64,192 $72,710 $215 $11,621 $8,298 $8,409 $622 $440 $699 $890 $50 $50 $31,294 $26,718 $3,299 $0 $1,109 $1,441 $33,373 $21,145 $53,613 $7,503 $73,644 $91,082 $3,950 $4,430 $7,245 $1,000 $710 $264,323 $297,696 $675 $54,039 $37,587 $29,826 $23,603 $2,610 $2,339 $7,936 $250 $305 $159,170
Sub Total - Stormwater

Wastewater - Trunk Sewers Wastewater - Collection System Wastewater - Forcemains Wastewater - Structures Wastewater - Treatment Facilities Wastewater - Energy Wastewater - Fleet Wastewater - IT Wastewater - Security Wastewater - Equipment
Sub Total - Wastewater Sub Total - Stormwater and Wastewater

Water - Land Water - Transmission Water - Distribution Water - Structures Water - Treatment Facilities Water - Energy Water - Fleet Water - IT Water - Security Water - Equipment
Sub Total - Water TOTALS - Stormwater / Wastewater / Water
$89,103
$51,011
$96,008
$116,740
$104,003
$456,866
January 9, 2013
Page 1 of 15
Page 416
Five Year Capital Budget - Stormwater Projects

All $ in 000's Project Name Region Y1 2013-2014 Stormwater - Pipes I/I Reduction Program Climate Change Adaptation Program Stormwater Quality Compliance Needs Assessment New storm sewers for I/I Reduction within prioritized sewersheds. Land acquisition & Management Program (split 50W/40WW/10SW) Integrated Stormwater Projects - Program Drainage Remediation Program Surveys/Studies Deep Storm Sewer Installation Program Asset Management Implementation Program (split 50W/40WW/10SW) Elizabeth Street Storm Sewer Replacement Acadia Mill Drive/Salmon River Terrace Storm Sewer Rehabilitation Crestfield Avenue (Uplands Phase 3) - Deep Storm Sewer Installation Pinehill Drive Embankment Protection Sullivan's Pond Storm Sewer System Replacement Integrated Resource Plan (split 50W/40WW/10SW) Ivylea Crescent - New Storm Sewer Raymond Street, Phase 2 - Storm Sewer Rehabilitation Winston Drive Stormwater Cross-Connection - Churchill Estates, Herring Cove HRM HRM HRM $300 $0 $0 $400 $200 $75 $500 $250 $75 $500 $250 $75 $75 $1,700 $700 $300 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Central
$690
$4,635
$5,417
$10,742
HRM HRM HRM HRM HRM East West Central Central East HRM West East West
$3 $525 $50 $800 $90 $45 $100
$3 $575 $200 $1,000 $90
$3 $575 $250 $1,000 $90
$3 $600 $300 $1,000 $60
$3 $600 $300 $1,000
$15 $2,875 $1,100 $4,800 $330 $45 $100
$720 $166 $2,000 $40 $40 $645 $300 $100
$720 $166 $2,000 $80 $645 $300 $100 $0
Stormwater - Pipes -- T O T A L S Stormwater - Culverts/Ditches Stormwater Culverts/Ditches Culvert Replacement Program Wilson Drive & Highway 2 - Culvert Replacement Sackville Drive (West of Hamilton) - Culvert Replacement (no civic provided) Civic # 43 Deepwood Drive, Hammonds Plains - Culvert replacement Inverness Avenue - Culvert Replacement HRM HRM Central Central Central West
$1,913
$5,429
$3,473
$8,408
$7,495
$26,718
$325
$325 $500
$0 $500
$0 $500
$163 $500
$813 $2,000 $149 $137 $100 $100
$149 $137 $100 $100
Stormwater - Culverts/Ditches -- T O T A L S
$811
$825
$500
$500
$663
$3,299
January 9, 2013
Page 2 of 15
Page 417
Five Year Capital Budget - Stormwater Projects

All $ in 000's Project Name Region Y1 2013-2014 Stormwater - Structures Idlewylde Road Storm Sewer Outlet/Embankment Stabilization Stormwater Structure Replacement Program Clement Street Berm - Rehabilitation of Stormwater Control System East & Central Operations Facility Review (split 50W/40WW/10SW) West HRM East East / Central $0 $150 $75 $6 $200 $150 $225 $200 $300 $300 $6 $0 Stormwater - Structures -- T O T A L S Stormwater - Fleet Fleet Upgrade Program HRM $249 $201 $245 $212 $202 $1,109 $0 Stormwater - Fleet -- T O T A L S Stormwater - IT Lateral Card Database Conversion Project (50WW/50SW) GIS Data Program Implementation (split 50W/40WW/10SW) Desktop Computer Replacement Program (split 50W/40WW/10SW) Network Infrastructure Upgrades (split 50W/40WW/10SW) Corporate IT Program (split 50W/40WW/10SW) Computerized Maintenance Management System (split 50W/40WW/10SW) Document Management System (split 50W/40WW/10SW) IT Disaster Recovery Site (split 50W/40WW/10SW) Multimedia Devices (split 50W/40WW/10SW) Corporate GIS Data Plan - Project 4 (Bedford Main Area P-8) (split 50W/40WW/10SW) SAP HR Self Serve Phase 1 (split 50W/40WW/10SW) HRM HRM HRM HRM HRM HRM HRM HRM HRM HRM HRM $125 $45 $16 $20 $0 $80 $40 $10 $30 $45 $20 $125 $60 $16 $0 $0 $80 $10 $30 $10 $125 $60 $18 $20 $20 $80 $60 $18 $20 $20 $80 $60 $18 $20 $20 $40 $375 $285 $86 $80 $60 $360 $50 $40 $40 $45 $20 $0 Stormwater - IT -- T O T A L S $431 $3,635 $331 $7,361 $323 $4,541 $198 $9,318 $158 $8,518 $1,441 $33,373 $249 $201 $245 $212 $202 $1,109 $231 $575 $0 $0 $0 $806 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
TOTALS - Stormwater
January 9, 2013
Page 3 of 15
Page 418
Five Year Capital Budget - Wastewater Projects

All $ in 000's Project Name Region Y1 2013-2014 Wastewater - Trunk Sewers Wastewater Sewers & Trunk Sewers Diversion Sewer from Mill Cove WWTF to Halifax, along Bedford waterfront to Bedford Hwy tunnel (MC7) Localized improvments to Bedford Sackville Trunk Sewer sections - diameters range between 525 mm and 1200 mm over 4.44 km (MC4) CN Quinpool Bridge Structure - Replacement of 450mm Combined Sewer Kearney Lake (Bedford West) CCC Northwest Arm Sewer Rehabilitation Jamieson Street Trunk Sewer Outfall Replacement Phase 2 - Construction HRM Central / West $0 $0 $0 $0 $6,000 $6,000 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
$605
$2,722
$2,722
$6,049
Central
$1,723
$1,723
$3,446
West West West East
$100 $50 $50 $150 $2,100 $1,100 $2,100
$100 $50 $4,400 $1,100 $0
Wastewater - Trunk Sewers - -- T O T A L S Wastewater - Collection System Wastewater Sewers & Trunk Sewers Wet Weather Management Planning Program I/I Reduction Program (HA8) I/I Reduction Program (HC6) Gravity sewer from Little Albro Lake to Jamieson St PS (DA1) 450mm surface water sewer from Fenwick St to Old Ferry Rd PS with the addition of Maynard St (DA2) I/I Reduction Program (DA9) I/I Reduction within Eastern Passage Drainage Area (EP1) Sewer twinning along existing roads - Albro Lake/Slayter St to Ferry St PS (DA3) General I/I reduction program allowance (MC8) Diversion Sewer from Springfield to Bedford Sackville Trunk Sewer (SP3) Gravity sewer from St Margarets Bay Rd to Armdale Rd PS (HA4) I/I Reduction Program - manhole sealing (MC1) Land acquisition & Management Program (split 50W/40WW/10SW) Asset Management Implementation Program (split 50W/40WW/10SW) Integrated Wastewater Projects - Program Outfall Elimination Program Overflow Monitoring Program HRM HRM West West East
$200
$150
$3,805
$6,545
$10,445
$21,145
$745 $250 $0 $0 $0
$745 $250 $640 $320 $376
$420 $250 $2,880 $1,440 $1,693
$0 $500 $1,725 $1,440 $1,694
$100 $500
$2,010 $1,750 $5,245 $3,200 $3,763
East
$301
$1,355
$1,355
$3,010
East East East Central Central West Central HRM HRM HRM HRM HRM $12 $360 $1,000 $0 $200
$0 $0
$320 $208 $948 $160 $112
$1,440 $936 $0 $720 $505 $611
$1,440 $936 $4,266 $720 $505 $611
$3,200 $2,080 $5,214 $1,600 $1,123 $1,222 $48
$48 $12 $360 $1,050 $0 $250 $12 $360 $1,100 $0 $250 $12 $240 $1,500 $0 $250 $1,500 $0 $250 $12
$60 $1,320 $6,150 $0 $1,200
January 9, 2013
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Page 419

All $ in 000's Project Name Region Y1 2013-2014 Sewer Lining Program Grit Management Facility Intercolonial Street Sewer Separation (potential integration with DND Willow Park Project) Mabou Avenue Sewer Replacement (cost currently shown includes watermain replacement) Quigley's Corner PS Sewershed - Sanitary Sewer Rehab Alder Crescent WW Collection System Replacement Springfield Lake Collection Upgrade Wanda Lane Sanitary Sewer Replacement Bedford South CCC Bedford West Collection System CCC Portland Hills Collection System CCC Integrated Resource Plan (split 50W/40WW/10SW) Russell Lake West Collection System CCC Kempt Road Sewer Replacement HRM HRM West West East Central Central East Central West East HRM East West $10 $0 $18 $25 $70 $160 $160 $165 $475 $50 $60 $590 $300 $2,000 $0 $550 $250 $1,000 $250 $1,200 $10 $25 $25 $25 Y2 2014-2015 $1,000 Y3 2015-2016 $1,000 Y4 2016-2017 $1,000 Y5 2017-2018 $1,000 Sub Total Y1 to Y5
$4,050 $60 $590 $300 $2,000 $550 $500 $2,200 $20 $100 $88 $320 $165 $475 $0
Wastewater - Collection System -- T O T A L S Wastewater - Forcemains Wastewater Forcemains 500mm Wastewater forcemain from Mill Cove WWTF to Mill Cove Diversion Sewer (MC6) 825mm Ferry Rd forcemain for 900l/s (DA7) Bayers Lake Forcemain Upgrade & Twinning MacPherson Forcemain Replacement and twinning Beaver Crescent PS - Forcemain Replacement Stuart Harris Drive PS - Forcemain Replacement Shore Drive Golf Links - Forcemain Replacement and Twinning Forcemain Replacement Program HRM Central East West Central East East Central HRM
$5,595
$7,199
$14,201
$14,752
$11,865
$53,613
$0
$0
$240
$0 $338 $283
$2,951 $338 $283
$3,191 $677 $567 $1,000 $443 $300 $100
$1,000 $443 $300 $100 $625 $600
$625 $600 $0
Wastewater - Forcemains -- T O T A L S
$1,843
$625
$240
$1,222
$3,573
$7,503
January 9, 2013
Page 5 of 15
Page 420

All $ in 000's Project Name Region Y1 2013-2014 Wastewater - Structures Wastewater Pumping Stations Storage Facility #1 at Glendale/Old Beaver Bank Road (upstream of Bedford Sackville Trunk Sewer) (MC2) New wastewater pumping station at Mill Cove WWTF for diversion to Halifax (MC5) Upgrade of Ferry Rd PS by 807 L/s to provide total capacity of 900 L/s (existing PS has 93 L/s) (DA6) Wastewater Pumping Station Upgrade Program Various Locations West Region East Region Central Region Lakeside Pumping Station - Diversion to the Halifax Sewershed Mowat Crescent PS - Back-up Power Supply Colpitt Lake PS Elimination Bedford PS Rehabilitation (at Mill Cove WWTF) Russell Lake PS Upgrade Roach's Pond Grit Building rehab Cowie Hill Operations Facility East & Central Operations Facility Review (split 50W/40WW/10SW) East Region Operation Facility - Design HRM Central Central East HRM West East Central West Central West Central East West HRM East / Central East $3,700 $24 $300 $60 $125 $75 $7,000 $25 $720 $750 $1,000 $1,375 $1,000 $250 $1,375 $4,911 $75 $400 $550 $400 $400 $0 $2,000 $1,920 $8,410 $8,640 $1,899 $8,640 $317 $968 $550 $317 $968 $500 $14,000 $26,709 $19,200 $634 $1,937 $2,000 $60 $125 $75 $11,911 $500 $720 $3,500 $2,000 $250 $3,700 $24 $300 $0 Wastewater Structures -- T O T A L S Wastewater - Treatment Facility Wastewater Treatment Facilities Bio-Solids Processing Facility Expansion Dartmouth WWTF - Characterize effluent UVT and assess capacity of the existing disinfection system. Upgrade UV disinfection system. Uplands Park WWTF - To ensure continued compliance with treatment requirements: - Construct flow splitter boxes and reconfigure trickling filter and clarifier influent piping to improve flow splits; and - Replace mechanical equipment associated with the existing trickling filters (distribution arms, effluent collection system). Lockview-MacPherson WWTF - Modifications to secondary clarifiers, such as installing baffles and replacing the sludge / scum collection equipment, to improve performance. HRM HRM East $448 $448 $1,792 $400 $2,000 $4,681 $17,774 $16,432 $120 $1,792 $41,287 $120 $4,480 $12,879 $10,456 $20,525 $13,999 $15,785 $73,644 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Central
$293
$293
Central
$240
$240
January 9, 2013
Page 6 of 15
Page 421

All $ in 000's Project Name Region Y1 2013-2014 Middle Musquodoboit WWTF - Provide additional equalization storage volume to attenuate peak flows to the downstream treatment process and/or provide a bypass line around the mechanical plant discharging to the polishing pond to protect the treatment process and ensure continued compliance with treatment requirements. Lockview-MacPherson WWTF - UV system upgrade. Lockview-MacPherson WWTF - Modifications to equalization tank pumping and/or increase equalization tank volume to reduce magnitude of peak flows to downstream treatment processes. Halifax WWTF - Conduct treatability study, optimize coagulant dosages, polymer dosages, and sludge pumping to improve performance of DensaDeg during high flows. Dartmouth WWTF - Conduct treatability study, optimize coagulant dosages, polymer dosages, and sludge pumping to improve performance of DensaDeg during high flows. Herring Cove WWTF - Optimize coagulant dosages, polymer dosages, and sludge pumping to improve performance of DensaDeg process during high flows. North Preston WWTF - Install an autosampler to collect samples of engineered wetland effluent to determine actual effluent loadings applied to the receiver, Whynder Lake. North Preston WWTF - Conduct a detailed biological treatment capacity assessment to evaluate the ability of the current process to provide consistent nitrification (to be completed after upgrades to the alkalinity addition system). North Preston WWTF - Provide additional alkalinity addition to supplement the existing caustic soda addition system and/or utilize a different chemical for alkalinity addition (Project underway). Eastern Passage WWTF Design Build Upgrade Beechville, Lakeville, Timberlea WWTF Upgrade Lockview-MacPherson WWTF - Tertiary Upgrade Wastewater Treatment Facilities Upgrades (Various Locations) - Middle Musquodoboit WWTF HHSP Upgrade Program - Halifax WWTF - Dartmouth WWTF - Herring Cove WWTF N-viro Facility - Upgrade Program Wastewater Treatment Facilities - Backup Power Program (Various Locations) Plant Optimization Audit Program Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Central
$120
$120
Central
$112
$112
Central
$102
$102
West
$98
$98
East
$98
$98
West
$46
$46
East
$37
$37
East
$33
$33
East
$29
$29
East West Central HRM Central HRM West East West HRM HRM HRM
$32,300 $0 $100 $250 $250 $250 $10 $250 $187 $118 $118 $63 $150 $125 $77 $278 $125 $125 $29 $250 $250 $250 $250 $0
$32,300 $0 $100 $1,000 $10 $1,000 $187 $118 $118 $169 $428 $375
January 9, 2013
Page 7 of 15
Page 422

All $ in 000's Project Name Region Y1 2013-2014 Mill Cove WWTF Emergency Overflow Outfall Pipe replacement Mill Cove WWTF Vacuum Swing Absorption Frame WWTF Replacement Bellmont WWTF decommissioning Mill Cove WWTF UV Upgrade Central Central Central East Central $100 $550 $300 Y2 2014-2015 $860 $400 $3,000 $400 $1,500 $1,075 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
$960 $950 $3,300 $1,900 $1,075
Wastewater - Treatment Facility -- T O T A L S Wastewater - Energy Energy Management Plan Update Halifax WWTF - UV Trans Monitoring & Control Dartmouth WWTF - UV Trans Monitoring & Control Herring Cove WWTF - UV Trans Monitoring & Control Various PS - HVAC Retro-commissioning Various PS - Reactive Power Correction Various - WWTF Energy Efficiency Upgrades Mill Cove WWTF - Bio-Gas CHP - Study Mill Cove WWTF - Bio-Gas CHP - Installation HRM Central East West HRM HRM HRM Central Central
$34,211
$4,588
$9,583
$22,651
$20,050
$91,082
$40 $50 $50 $50 $150 $150 $250 $100
$40
$40
$40
$40
$200 $50 $50 $50
$150 $150 $250
$150 $150 $250
$150 $150 $250
$150 $150 $250
$750 $750 $1,250 $100
$750
$750 $0
Wastewater - Energy -- T O T A L S Wastewater - Fleet Fleet Upgrade Program HRM
$840
$1,340
$590
$590
$590
$3,950
$994
$804
$980
$846
$806
$4,430 $0
Wastewater - Fleet -- T O T A L S Wastewater - IT SCADA Control System Enhancements SCADA Master Plan Update (50/50 allocation W/WW) Lateral Card Database Conversion Project (50WW/50SW) GIS Data Program Implementation (split 50W/40WW/10SW) Desktop Computer Replacement Program (split 50W/40WW/10SW) Network Infrastructure Upgrades (split 50W/40WW/10SW) HRM HRM HRM HRM HRM HRM
$994
$804
$980
$846
$806
$4,430
$100
$100
$100
$100 $100
$100
$500 $100 $375
$125 $180 $64 $80
$125 $240 $64 $0
$125 $240 $72 $80 $240 $72 $80 $240 $72 $80
$1,140 $344 $320
January 9, 2013
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Page 423

All $ in 000's Project Name Region Y1 2013-2014 Corporate IT Program (split 50W/40WW/10SW) Computerized Maintenance Management System (split 50W/40WW/10SW) Document Management System (split 50W/40WW/10SW) IT Disaster Recovery Site (split 50W/40WW/10SW) Multimedia Devices (split 50W/40WW/10SW) Corporate GIS Data Plan - Project 4 (Bedford Main Area P-8) (split 50W/40WW/10SW) SCADA Master Plan Implementation (50/50 split W/WW) SAP HR Self Serve Phase 1 (split 50W/40WW/10SW) HRM HRM HRM HRM HRM HRM HRM HRM $0 $320 $160 $40 $120 $180 $0 $80 $1,329 $677 Y2 2014-2015 $0 $320 $40 $120 $40 Y3 2015-2016 $80 $320 Y4 2016-2017 $80 $320 Y5 2017-2018 $80 $160 Sub Total Y1 to Y5
$240 $1,440 $200 $160 $160 $180 $2,006 $80 $0
Wastewater - IT -- T O T A L S Wastewater - Security Security Upgrade Program HRM
$1,449
$2,378
$1,694
$992
$732
$7,245
$200
$200
$200
$200
$200
$1,000 $0
Wastewater - Security -- T O T A L S Wastewater - Equipment SIR Program Flow Meters and Related Equipment ` Asphalt Roller ` Tri-axel Trailer ` Trailer and Walk behind Asphalt Saw Miscellaneous Equipment Replacement HRM West West East HRM
$200
$200
$200
$200
$200
$1,000
$75 $15 $30 $30 $0
$75
$75
$75
$75
$375 $15 $30 $30
$60
$60
$70
$70
$260
Wastewater - Equipment -- T O T A L S
$150 $58,361
$135 $27,875
$135 $51,953
$145 $61,942
$145 $64,192
$710 $264,323
TOTALS - Wastewater
January 9, 2013
Page 9 of 15
Page 424
Five Year Capital Budget - Water Projects

All $ in 000's Project Name Region Y1 2013-2014 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Water - Land Land acquisition & Management Program (split 50W/40WW/10SW) Watershed Land Acquisition HRM HRM $15 $0 $15 $200 $15 $200 $15 $15 $200 $75 $600 $0 Water - Land -- T O T A L S Water - Transmission Water Transmission Mains Pockwock Transmission Main Replacement Kearney Lake Road (Bluewater Road to Ham-Kearney Connector) (W2) North End Feeder Tunnel 36" Transmission Main Rehab (W3) Bedford Connector 30" Replacement - Phase 3 (C1) Burnside - Bedford Connector Transmission Main Extension of 600mm Main on Glendale Dr. to HWY 102 (E9) Port Wallace Transmission Main - Phase 1 (E3) Lucasville Road Transmission Main - Phase 1 (includes beaverbank Reinforcement) (C4) Pockwock Transmission Main Replacement Kearney Lake Road (Twin Culverts to Bluewater Road) (W1) Governor's Brook Phase 3 Oversizing Bedford South CCC Bedford West CCC - Various Phases Morris (Russell) Lake Estates CCC Lakeside Timberlea CCC Northgate CCC Asset Management Implementation Program (split 50W/40WW/10SW) Critical Trans Main Valve Replacement Program Integrated Resource Plan (split 50W/40WW/10SW) HRM West West Central East East Central West West Central Central East West Central HRM West HRM $450 $11,700 $70 $25 $30 $25 $5 $5 $5 $450 $250 $450 $250 $200 $300 $250 $200 $250 $2 $25 $30 $30 $330 $30 $15 $2 $20 $0 $0 $0 $0 $248 $202 $0 $0 $6,037 $611 $292 $248 $202 $590 $894 $13,780 $611 $292 $991 $807 $590 $894 $0 $2,446 $1,169 $991 $807 $2,361 $3,577 $19,817 $3,668 $1,754 $2,477 $2,017 $3,541 $5,365 $11,700 $70 $380 $140 $40 $14 $5 $1,650 $1,000 $400 $0 Water - Transmission -- T O T A L S Water - Distribution Water Distribution Mains Water Meters Water Valves Water Distribution - Main Renewal Program Cathodic Protection Program ~ Valves ~ Hydrants ~ Service Lines HRM HRM HRM HRM HRM HRM HRM HRM $0 $0 $0 $4,000 $300 $125 $75 $240 $0 $0 $0 $5,000 $300 $125 $75 $240 $2,782 $0 $0 $3,600 $300 $125 $75 $240 $2,782 $0 $0 $3,600 $300 $125 $75 $240 $2,323 $446 $39 $3,600 $300 $125 $75 $240 $7,887 $446 $39 $19,800 $1,500 $625 $375 $1,200 $12,305 $1,214 $9,806 $19,093 $11,621 $54,039 $15 $215 $215 $15 $215 $675
January 9, 2013
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All $ in 000's Project Name Region Y1 2013-2014 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
~ Meter Program Automated Flushing System
HRM East
$1,100 $15
$1,150
$1,150
$1,150
$1,150
$5,700 $15 $0
Water - Distribution -- T O T A L S Water - Structures Water Pumping Stations Water Pumping Stations - Aerotech Water PRVs Herring Cove Reservoir * Bedford South Reservoir * Lake Major Dam Replacement in 2017 Water Efficiency Program Chambers and Pumping Stations East & Central Operations Facility Review (split 50W/40WW/10SW) CSE - Chlorine - Chamber Storage/Relocation. Various Locations CSE - BroadholmeChamber Entrance Retorfit Prince Albert Road PRV - Small PRV installation Replace Ross Valves - various locations Highway #7 Booster Station Upgrades North Preston Reservoir Mixing System Cowie Hill Operations Facility DMA Program * Majority funding from non-capital source HRM HRM HRM West West East HRM HRm East / Central HRM West East Central Central East HRM HRM
$5,855
$6,890
$8,272
$8,272
$8,298
$37,587
$0 $0 $0
$200 $0 $200 $425
$4,005 $785 $576 $425 $1,100
$3,005 $785 $576 $1,700 $1,100 $839 $100 $250
$220 $0 $800 $1,700 $4,400 $839 $100 $250
$7,431 $1,571 $2,152 $4,250 $6,600 $2,097 $400 $1,000 $30 $50 $27 $11 $16 $55 $36 $3,700
$210 $100 $250 $30 $50 $27 $11 $16 $55 $36 $3,700 $100
$210 $100 $250
$100
$100
$100
$400
$0 Water - Structures -- T O T A L S Water - Treatment Facilities Pockwock and Lake Major Treatment Facilities Small Water Treatment Facilities Water Quality Master Plan (WQMP) Periodic Updates JD Kline WSP Upgrade Program JD Kline Fume hood replacement JD Kline Caustic Soda pipe/pumping replacement JD Kline Backwash pump motor replacement JD Kline Drying bed expansion/upgrade J D Kline - Replacement program for Filter Valve Actuators HRM HRM HRM West / Central West / Central West / Central West / Central West / Central West / Central $50 $50 $425 $100 $45 $45 $45 $300 $300 $0 $0 $0 $0 $6,292 $135 $6,543 $135 $100 $300 $300 $0 $122 $12,835 $393 $100 $1,200 $50 $50 $425 $100 $135 $3,925 $1,485 $7,551 $8,456 $8,409 $29,826
January 9, 2013
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Page 426

All $ in 000's Project Name Region Y1 2013-2014 J D Kline - Chemical Feed Pump Replacement Program J D Kline - Chlorination System Replacement J D Kline - Replace Valve Actuators at the Pumping Station J D Kline - Mechanical Mixers in the Mixing Tanks J D Kline - Entrance Road Paving Renewal J D Kline - Removal of Aluminium in the process wastewater J D Kline - Parking Lot Resurfacing Lake Major WSP Upgrade program Lake Major safety ladder and walkways for Mixer unit Laker Major dehumidifier system for Low Lift Building Non-Urban Core WSP Upgrade program Miller Lake S.S. storage tank liner installation Miller Lake S.S. land purchase- extension of water line, access road and power supply Lake Lamont emergency supply intake gate valve replacement West / Central West / Central West / Central West / Central West / Central West / Central West / Central East East East HRM Central Central East $5 $500 $25 $15 $15 $150 $150 $150 $150 $50 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
$120 $925
$120
$120
$120
$480 $925
$95 $1,550 $85 $2,700 $120 $50 $50 $50 $1,000
$95 $2,550 $85 $2,700 $120 $200 $15 $15 $600 $5 $500 $25
Water - Treatment Facilities -- T O T A L S Water - Energy Energy Management Plan Update JD Kline - Heat Recovery Study and Upgrade JD Kline - Industrial Process Pumps Upgrade Various - Chamber HVAC Retro-commissioning Various - WSP Energy Reduction Upgrades HRM W/C W/C HRM HRM
$2,275
$2,395
$10,912
$7,398
$622
$23,603
$40 $300
$40
$40
$40
$40
$200 $300
$110 $150 $250 $150 $250 $150 $250 $150 $250 $150 $250
$110 $750 $1,250 $0
Water - Energy -- T O T A L S Water - Fleet ~ Fleet Upgrade Program HRM
$740
$550
$440
$440
$440
$2,610
$252
$457
$424
$507
$699
$2,339 $0
Water - Fleet -- T O T A L S Water - IT SCADA Control System Enhancements SCADA Master Plan Update (50/50 allocation W/WW) GIS Data Program Implementation (split 50W/40WW/10SW) ~ Desktop Computer Replacement Program (split 50W/40WW/10SW) Network Infrastructure Upgrades (split 50W/40WW/10SW) Corporate IT Program (split 50W/40WW/10SW) HRM HRM HRM HRM HRM HRM
$252
$457
$424
$507
$699
$2,339
$100
$100
$100
$100 $100
$100
$500 $100
$225 $80 $100 $0
$300 $80 $0 $0
$300 $90 $100 $100
$300 $90 $100 $100
$300 $90 $100 $100
$1,425 $430 $400 $300
January 9, 2013
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Page 427

All $ in 000's Project Name Region Y1 2013-2014 Computerized Maintenance Management System (split 50W/40WW/10SW) Document Management System (split 50W/40WW/10SW) IT Disaster Recovery Site (split 50W/40WW/10SW) Multimedia Devices (split 50W/40WW/10SW) Corporate GIS Data Plan - Project 4 (Bedford Main Area P-8) (split 50W/40WW/10SW) SCADA Master Plan Implementation (50/50 split W/WW) SAP HR Self Serve Phase 1 (split 50W/40WW/10SW) Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
HRM HRM HRM HRM HRM HRM HRM
$400 $200 $50 $150 $225 $0 $100
$400 $50 $150 $50
$400
$400
$200
$1,800 $250 $200 $200 $225
$1,329
$677
$2,006 $100 $0
Water - IT -- T O T A L S Water - Security Security Upgrade Program HRM
$1,630
$2,459
$1,767
$1,190
$890
$7,936
$50
$50
$50
$50
$50
$250 $0
Water - Security -- T O T A L S Water - Equipment Miscellaneous Equipment Replacement ` Survey software upgrade ` Travel - Vacuum Trailer ` Shell Cutters ` Diesel Plate Compactor ` Small Hydro Vac for valve box maintenance ` Large tapping machine c/w electric operator and 4" to 12" cutters ~ Denotes Blanket Approval Requests HRM HRM Central HRM HRM HRM HRM
$50
$50
$50
$50
$50
$250
$20 $10 $21 $9
$60
$60
$0
$50
$190 $10 $21 $9
$16 $25 $34
$16 $25 $34
Water - Equipment -- T O T A L S
$60 $27,107
$60 $15,775
$76 $39,514
$59 $45,480
$50 $31,294
$305 $159,170
TOTALS - Water
January 9, 2013
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Page 428
Five Year Capital Budget - Aerotech/Airport System
All $ in 000's Y1 2013-2014 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Aerotech / Airport Budget Summary

Stormwater Wastewater Water $0 $1,156 $675 $0 $8,906 $185 $0 $10,583 $2,894 $0 $346 $2,894 $0 $177 $367 $0 $21,168 $7,015
TOTALS - Aerotech / Airport Summary
$1,831
$9,091
$13,476
$3,240
$544
$28,182
January 9, 2013
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Page 429
Five Year Capital Budget - Aerotech/Airport System Projects

All $ in 000's Project Name Region Y1 2013-2014 Stormwater $0 $0 Stormwater -- T O T A L S Wastewater Airport/Aerotech WW Pumping Stations Airport/Aerotech WW Treatment Facilities Implement an operational control strategy to slowly add the Aerotech lagoon effluent to the mechanical treatment plant to avoid slug loads of high TKN/TAN influent during wet weather events. Aerotech WWTF Upgrade - Design/Construction Aerotech WWTF Upgrades Bennery Bennery $156 $0 $156 $0 $156 $389 $156 $190 $25 $0 $649 $579 $0 $0 $0 $0 $0 $0 Y2 2014-2015 Y3 2015-2016 Y4 2016-2017 Y5 2017-2018 Sub Total Y1 to Y5
Bennery
$152
$152
Bennery Bennery
$1,000 $0
$8,750 $0
$10,000 $38 $0
$19,750 $38 $0
Wastewater -- T O T A L S Water Airport/Aerotech Water Treatment Facilities Bennery Lake WSP - Future Process Improvements (from 2008 Aerotech Servicing Study) Bennery Lake WTP miscellaneous upgrades relating to process optimization study Bennery Lake WSP - Future Process Improvements (from 2008 Aerotech Servicing Study) Bennery - Lighting Upgrades Bennery - HVAC Study + Upgrade Bennery Bennery
$1,156
$8,906
$10,583
$346
$177
$21,168
$0
$0 $185
$2,061 $833
$2,061 $833
$367
$4,490 $1,850
Bennery Bennery
$200
$200 $0
East East
$75 $400
$75 $400 $0
Water -- T O T A L S
$675
$185
$2,894
$2,894
$367
$7,015
January 9, 2013
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January 9, 2013
Page 431
AppendixF
ProjectedOperatingStatementsConsolidated 201314to201718
tkk Halifax Water

January 9, 2013
Page 433
7-Jan-2013 Page 1 of 6
HALIFAX WATER CONSOLIDATED SUMMARY OF ESTIMATED REVENUES & EXPENDITURES APRIL 1, 2012 to MARCH 31, 2018
January 9, 2013
DESCRIPTION
$98,828 $77,244 $85,008 $96,328 $100,377 $108,194 $105,375 $106,870 $105,566 $105,343
APR 1/11 MAR 31/12 ACTUAL '000
APR 1/12 MAR 31/13 FORECAST1 '000
APR 1/13 MAR 31/14 BUDGET '000
APR 1/14 MAR 31/15 BUSINSS PLAN '000

$105,122 $112,026

$104,900 $115,365
OPERATING REVENUES
OPERATING EXPENDITURES $21,584 $20,367 $10,542 $5,189
OPERATING PROFIT
($2,851)
($6,904)
($10,465)
FINANCIAL REVENUES (NON-OPERATING) INVESTMENT INCOME PNS FUNDING HHSP DEBT MISCELLANEOUS
$402 $2,000 $194 $2,596 $700 $2,000 $268 $2,968 $660 $2,000 $297 $2,957 $660 $2,000 $342 $3,002
$660 $2,000 $347 $3,007
$660 $2,000 $349 $3,009
$660 $2,000 $350 $3,010
FINANCIAL EXPENDITURES (NON-OPERATING) LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT DIVIDEND/GRANT IN LIEU OF TAXES
$8,100 $13,066 $63 $3,944 $25,173 $8,137 $14,719 $91 $3,971 $26,917 $7,112 $15,601 $133 $4,249 $27,095
$9,935 $18,522 $183 $4,671 $33,310
$10,899 $20,760 $241 $4,667 $36,566
$13,726 $24,820 $319 $5,066 $43,930
$16,797 $28,944 $390 $5,548 $51,679
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES ($993) ($3,582)
($13,596)
($25,120)
($36,409)
($47,825)
($59,134)
Adjustments: Debt Servicing Section 3461 Pension
$1,144 $2,400
$1,799 $2,400
$0 $2,400
NET PROFIT (LOSS) IN CALCULATING THE REVENUE REQUIREMENT FOR RATE APPLICATION PURPOSES
($38)
($9,397)
($22,720)
Page 434
1 - Forecast projections updated as at October 31, 2012.
G:\FINANCE\Budgets\2013_2014\Corporate\Financial Statements\5 Year Business Plan 2013-18.xlsx
HALIFAX WATER ESTIMATED REVENUES AND EXPENDITURES - WATER OPERATIONS APRIL 1, 2012 to MARCH 31, 2018
January 9, 2013
DESCRIPTION
REVENUES METERED SALES FIRE PROTECTION PRIVATE FIRE PROTECTION SERVICES BULK WATER STATIONS CUSTOMER LATE PAY./COLLECTION FEES MISCELLANEOUS
$30,562 $9,502 $366 $264 $206 $155 $41,055 $5,788 $6,995 $810 $840 $2,958 $627 $1,697 $3,627 $6,458 $29,800 $6,436 $7,871 $759 $940 $3,240 $618 $1,774 $4,486 $6,816 $32,940 $6,772 $8,972 $686 $813 $3,519 $708 $1,876 $4,738 $7,605 $35,688 $7,082 $9,058 $649 $868 $3,730 $720 $1,901 $4,758 $8,416 $37,182 $7,469 $9,850 $673 $908 $3,850 $741 $1,967 $4,939 $9,177 $39,576 $32,526 $9,843 $367 $218 $249 $134 $43,337 $32,796 $9,948 $374 $243 $228 $149 $43,738 $32,481 $9,948 $379 $243 $226 $149 $43,427 $32,488 $9,948 $384 $243 $227 $150 $43,440
$32,497 $9,948 $389 $243 $227 $151 $43,456 $7,628 $10,153 $687 $930 $3,927 $756 $2,006 $5,038 $9,782 $40,907
$32,508 $9,948 $394 $243 $227 $152 $43,473 $7,791 $10,448 $701 $949 $4,006 $771 $2,046 $5,139 $10,293 $42,144
EXPENDITURES WATER SUPPLY & TREATMENT TRANSMISSION & DISTRIBUTION SMALL SYSTEMS (incl. Contract Systems) TECHNICAL SERVICES (SCADA) ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION
OPERATING PROFIT
$11,255
$10,397
$8,050
$6,245
$3,864
$2,549
$1,329
FINANCIAL REVENUES (NON-OPERATING) INVESTMENT INCOME MISCELLANEOUS

$201 $107 $308 $350 $189 $539
$330 $216 $546
$330 $259 $589
$330 $264 $594
$330 $265 $595
$330 $265 $595
$2,472 $4,904 $51 $3,944 $11,371
$2,398 $5,213 $54 $3,971 $11,637
$2,105 $5,648 $67 $4,249 $12,068
$2,641 $6,737 $80 $4,671 $14,129
$3,423 $8,450 $101 $4,667 $16,642
$4,477 $10,123 $134 $5,066 $19,800
$5,950 $11,896 $163 $5,548 $23,557
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES
$192
($701)
($3,472)
($7,295)
($12,183)
($16,657)
($21,633)
Page 435
HALIFAX WATER ESTIMATED REVENUES AND EXPENDITURES - WASTEWATER OPERATIONS APRIL 1, 2012 to MARCH 31, 2018
January 9, 2013
APR 1/11 MAR 31/12 ACTUAL '000 APR 1/12 MAR 31/13 1 FORECAST '000 APR 1/13 MAR 31/14 BUDGET '000 APR 1/14 MAR 31/15 BUSINSS PLAN '000 APR 1/15 MAR 31/16 BUSINSS PLAN '000 APR 1/16 MAR 31/17 BUSINSS PLAN '000
$49,041 $165 $324 $483 $747 $129 $103 $50,992 $9,781 $14,865 $885 $352 $279 $786 $2,401 $1,152 $1,356 $2,899 $4,890 $39,646 $9,460 $14,635 $971 $473 $305 $821 $2,793 $1,216 $1,418 $3,585 $7,519 $43,196 $10,129 $16,269 $996 $1,298 $312 $1,096 $3,114 $1,339 $1,499 $3,786 $10,417 $50,255 $10,443 $16,768 $1,018 $707 $321 $1,150 $3,322 $1,374 $1,520 $3,803 $12,020 $52,445 $10,868 $18,651 $1,070 $920 $337 $1,186 $3,434 $1,419 $1,572 $3,947 $13,356 $56,761 $53,002 $204 $339 $160 $600 $160 $128 $54,593 $53,802 $180 $352 $86 $715 $148 $128 $55,411 $52,923 $180 $355 $86 $715 $146 $128 $54,533 $52,709 $180 $367 $86 $715 $145 $128 $54,330 $52,498 $180 $375 $86 $715 $145 $128 $54,126 $11,083 $19,016 $1,092 $998 $344 $1,209 $3,503 $1,448 $1,603 $4,026 $14,589 $58,911
DESCRIPTION
REVENUES METERED SALES2 WASTEWATER OVERSTRENGTH AGREEMENTS LEACHATE CONTRACT REVENUE AEROTECH SEPTAGE TIPPING FEES CUSTOMER LATE PAY./COLLECTION FEES MISCELLANEOUS
$52,291 $180 $375 $86 $715 $144 $128 $53,919 $11,302 $19,390 $1,114 $1,076 $352 $1,234 $3,573 $1,477 $1,635 $4,107 $15,445 $60,704
EXPENDITURES WASTEWATER COLLECTION WASTEWATER TREATMENT PLANTS SMALL SYSTEMS DEWATERING FACILITY/ SLUDGE MGM'T LEACHATE CONTRACT TECHNICAL SERVICES (SCADA) ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION
OPERATING PROFIT
$11,346
$11,397
$5,156
$2,088
($2,431)
($4,785)
($6,785)
FINANCIAL REVENUES (NON-OPERATING) INVESTMENT INCOME PNS FUNDING HHSP DEBT MISCELLANEOUS
$201 $2,000 $87 $2,288 $350 $2,000 $79 $2,429
$330 $2,000 $81 $2,411
$330 $2,000 $82 $2,412
$330 $2,000 $83 $2,413
$330 $2,000 $84 $2,414
$330 $2,000 $85 $2,415
FINANCIAL EXPENDITURES (NON-OPERATING) LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT
$5,181 $7,533 $12 $12,726
$5,278 $8,837 $37 $14,151
$4,603 $9,271 $67 $13,941
$6,791 $10,988 $102 $17,881
$6,942 $11,447 $140 $18,529
$8,583 $13,639 $185 $22,407
$9,463 $15,070 $227 $24,760
Page 436
$908
($325)
($6,374)
($13,381)
($18,547)
($24,778)
($29,131)
2 - Stormwater Operations does not have a separate base or consumption rate for billing purposes under the NSUARB. Metered sales revenues for Stormwater are allocated internally for financial statement presentation from Wastewater Operations at a rate of 9.8%. The Rate Application being submitted to the NSUARB in 2013 does provide for separate Stormwater Rates based on the new Cost of Service Manual ordered by the NSUARB, which was submitted October/2012.
HALIFAX WATER ESTIMATED REVENUES AND EXPENDITURES - STORMWATER OPERATIONS APRIL 1, 2012 to MARCH 31, 2018
January 9, 2013
DESCRIPTION
REVENUES METERED SALES2 CUSTOMER LATE PAY./COLLECTION FEES MISCELLANEOUS

$5,343 $12 $74 $5,429 $4,441 $0 $455 $510 $278 $594 $0 $6,278 $5,180 $0 $572 $560 $290 $734 $0 $7,336 $5,875 $34 $638 $612 $307 $776 $426 $8,668 $5,988 $35 $680 $631 $311 $779 $589 $9,015 $6,175 $36 $703 $653 $322 $809 $745 $9,444 $5,741 $18 $143 $5,902 $5,865 $16 $93 $5,975 $5,770 $16 $93 $5,879 $5,746 $16 $93 $5,855
$5,723 $16 $93 $5,833 $6,310 $37 $717 $667 $328 $825 $859 $9,743
$5,701 $16 $93 $5,810 $6,448 $38 $732 $680 $335 $841 $927 $10,000
EXPENDITURES STORMWATER COLLECTION TECHNICAL SERVICES (SCADA) ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION
OPERATING PROFIT
($849)
($1,434)
($2,693)
($3,136)
($3,588)
($3,911)
($4,190)
FINANCIAL EXPENDITURES (NON-OPERATING) LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT
$412 $587 $0 $999 $386 $585 $0 $971 $356 $585 $0 $941
$459 $699 $0 $1,157
$491 $765 $0 $1,256
$626 $960 $0 $1,587
$1,348 $1,880 $0 $3,228
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES ($1,848) ($2,404)
($3,634)
($4,293)
($4,844)
($5,497)
($7,418)
2 - Stormwater Operations does not have a separate base or consumption rate for billing purposes under the NSUARB. Metered sales revenues for Stormwater are allocated internally for financial statement presentation from Wastewater Operations at a rate of 9.8%. The Rate Application being submitted to the NSUARB in 2013 does provide for separate Stormwater Rates based on the new Cost of Service Manual ordered by the NSUARB, which was submitted October/2012.
Page 437
HALIFAX WATER ESTIMATED REVENUES & EXPENDITURES - AIRPORT/ AEROTECH OPERATIONS APRIL 1, 2012 to MARCH 31, 2018
DESCRIPTION
APR 1/11 MAR 31/12 ACTUAL
APR 1/12 MAR 31/13 FORECAST1
APR 1/13 MAR 31/14 BUDGET
APR 1/14 MAR 31/15 BUSINSS PLAN
AIRPORT/ AEROTECH WATER OPERATIONS REVENUES METERED SALES FIRE PROTECTION OTHER CONNECTION CHARGE CUSTOMER LATE PAY./COLLECTION FEES EXPENDITURES PLANT OPERATIONS PUMPING STATIONS TRANSMISSION & DISTRIBUTION ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION
I
$536,752 $141,598 $5,179 $1,035 $684,564 $541,363 $20,142 $87,128 $2,017 $557 $1,666 $3,536 $42,569 $698,978 ($14,414) $569,517 $156,259 $4,982 $500 $731,258 $529,583 $27,930 $94,400 $2,420 $548 $1,743 $4,407 $44,376 $705,407 $25,851 $627,525 $183,123 $5,410 $1,000 $817,058 $611,041 $29,307 $115,296 $2,669 $628 $1,843 $4,654 $50,160 $815,598 $1,460 $610,491 $192,890 $5,410 $1,000 $809,791 $615,996 $29,942 $113,187 $2,795 $638 $1,868 $4,674 $48,160 $817,259 ($7,469) $605,814 $192,890 $5,410 $1,000 $805,114 $643,695 $31,539 $185,599 $2,883 $658 $1,932 $4,852 $48,160 $919,318 ($114,204) $601,184 $192,890 $5,410 $1,000 $800,484 $657,054 $32,213 $203,438 $2,940 $671 $1,971 $4,949 $48,160 $951,396 ($150,912) $596,601 $192,890 $5,410 $1,000 $795,901 $670,718 $32,904 $221,983 $2,999 $684 $2,010 $5,048 $48,160 $984,506 ($188,605)
OPERATING PROFIT FINANCIAL EXPENDITURES (NON-OPERATING) LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISC
$24,358 $28,990 $0 $53,348
$34,389 $52,388 $0 $86,777
$29,890 $53,740 $0 $83,630
$27,806 $53,740 $0 $81,546
$25,652 $53,740 $0 $79,392
$23,428 $53,740 $0 $77,168
$21,134 $53,740 $0 $74,874
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - WATER OPERATIONS
($67,762)
($60,926)
($82,170)
($89,015)
($193,596)
($228,080)
($263,479)
AIRPORT/ AEROTECH WASTEWATER OPERATIONS REVENUES METERED SALES CUSTOMER LATE PAY./COLLECTION FEES DEWATERING FACILITY/ SLUDGE LAGOON AIRLINE EFFLUENT
I
$528,485 $1,465 $97,850 $39,780 $667,580 $554,238 $500 $182,255 $74,284 $811,277 $624,137 $1,000 $209,673 $94,283 $929,093 $612,556 $1,000 $209,673 $94,283 $917,512 $607,367 $1,000 $209,673 $94,283 $912,324 $602,231 $1,000 $209,673 $94,283 $907,187 $597,145 $1,000 $209,673 $94,283 $902,101
EXPENDITURES TREATMENT PLANT COLLECTION SYSTEM TECHNICAL SERVICES (SCADA) ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION
733,244 $53,802 $0 $1,480 $1,278 $1,229 $2,587 $26,321 $819,941 ($152,361)
$712,982 $61,214 $0 $1,936 $1,104 $1,394 $3,526 $48,070 $830,226 ($18,949)
$769,572 $60,902 $0 $2,135 $1,215 $1,474 $3,723 $62,200 $901,222 $27,872
$782,990 $63,618 $0 $2,236 $1,247 $1,494 $3,739 $62,200 $917,524 ($11)
$1,355,360 $67,158 $0 $2,306 $1,289 $1,546 $3,882 $62,200 $1,493,739 ($581,416)
$1,372,773 $68,593 $0 $2,352 $1,314 $1,577 $3,959 $62,200 $1,512,768 ($605,582)
$1,390,609 $70,065 $0 $2,399 $1,341 $1,608 $4,038 $62,200 $1,532,261 ($630,159)
OPERATING PROFIT FINANCIAL EXPENDITURES (NON-OPERATING) LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT
$10,900 $12,981 $0 $23,881
$40,004 $31,166 $0 $71,170
$18,417 $43,830 $0 $62,247
$17,558 $43,830 $0 $61,388
$16,664 $43,830 $0 $60,494
$15,725 $43,830 $0 $59,555
$14,742 $43,830 $0 $58,572
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - WASTEWATER OPERATIONS
($176,242)
($90,119)
($34,375)
($61,399)
($641,910)
($665,137)
($688,731)
AIRPORT/ AEROTECH STORMWATER OPERATIONS REVENUES AREA CHARGES CUSTOMER LATE PAY./COLLECTION FEES
I
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
EXPENDITURES COLLECTION SYSTEM ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION
$587 $134 $229 $105 $242 $1,297
$0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - STORMWATER OPERATIONS
($1,297)
$0
$0
$0
$0
$0
$0
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - COMBINED OPERATIONS
($245,301)
($151,045)
($116,545)
($150,414)
($835,505)
($893,216)
($952,211)
January 9, 2013
Page 438
HALIFAX WATER ESTIMATED REVENUES & EXPENDITURES, SEGREGATED BY REGULATED AND UNREGULATED ACTIVITIES APRIL 1, 2012 to MARCH 31, 2018
DESCRIPTION
REGULATED ACTIVITIES REVENUES METERED SALES FIRE PROTECTION PRIVATE FIRE PROTECTION AIRPORT AEROTECH SYSTEM OTHER OPERATING REVENUE EXPENDITURES WATER SUPPLY & TREATMENT TRANSMISSION & DISTRIBUTION WASTEWATER & STORMWATER COLLECTION WASTEWATER TREATMENT PLANTS SMALL SYSTEMS SCADA, CONTROL & PUMPING ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE ADMINISTRATION & PENSION DEPRECIATION AIRPORT AEROTECH SYSTEM
I
$84,946 $9,502 $366 $1,215 $1,071 $97,100 $5,788 $6,995 $14,189 $14,865 $1,681 $1,626 $5,814 $2,289 $3,331 $7,120 $11,348 $1,519 $76,564 $20,535 $91,269 $9,843 $367 $1,286 $1,233 $103,998 $6,436 $7,871 $14,640 $14,635 $1,721 $1,761 $6,605 $2,394 $3,482 $8,805 $14,335 $1,536 $84,221 $19,777 $92,464 $9,948 $374 $1,442 $1,164 $105,392 $6,772 $8,972 $16,004 $16,269 $1,668 $1,942 $7,272 $2,659 $3,647 $9,280 $18,448 $1,717 $94,650 $10,741 $91,174 $9,948 $379 $1,423 $1,160 $104,084 $7,082 $9,058 $16,431 $16,768 $1,653 $2,053 $7,733 $2,725 $3,697 $9,321 $21,026 $1,735 $99,281 $4,803 $90,943 $9,948 $384 $1,413 $1,160 $103,848 $7,469 $9,850 $17,043 $18,651 $1,729 $2,130 $7,988 $2,814 $3,826 $9,676 $23,278 $2,413 $106,868 ($3,020) $90,719 $9,948 $389 $1,404 $1,159 $103,619 $7,628 $10,153 $17,393 $19,016 $1,765 $2,176 $8,148 $2,871 $3,903 $9,870 $25,230 $2,464 $110,615 ($6,996) $90,500 $9,948 $394 $1,394 $1,159 $103,395 $7,791 $10,448 $17,750 $19,390 $1,800 $2,221 $8,310 $2,928 $3,982 $10,067 $26,664 $2,517 $113,868 ($10,472)
OPERATING PROFIT FINANCIAL REVENUES (NON-OPERATING) INVESTMENT INCOME MISCELLANEOUS
$402 $2,045 $2,447
$700 $2,162 $2,862
$660 $2,075 $2,735
$660 $2,075 $2,735
$660 $2,075 $2,735
$660 $2,075 $2,735
$660 $2,075 $2,735
$8,100 $13,066 $63 $3,944 $25,173
$8,137 $14,719 $91 $3,971 $26,917
$7,112 $15,601 $133 $4,249 $27,095
$9,935 $18,522 $183 $4,671 $33,310
$10,899 $20,760 $241 $4,667 $36,566
$13,726 $24,820 $319 $5,066 $43,930
$16,797 $28,944 $390 $5,548 $51,679
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - REGULATED ACTIVITIES
($2,191)
($4,278)
($13,619)
($25,772)
($36,851)
($48,191)
($59,416)
UNREGULATED ACTIVITIES REVENUES AEROTECH SEPTAGE TIPPING FEES LEACHATE CONTRACT REVENUE DEWATERING FACILITY/ SLUDGE LAGOON AIRLINE EFFLUENT ENERGY PROJECTS MISCELLANEOUS EXPENDITURES WATER SUPPLY & TREATMENT WASTEWATER TREATMENT ENERGY PROJECTS SPONSORSHIPS & DONATIONS
I
$747 $324 $483 $98 $40 $0 $36 $1,728 $14 $664 $0 $0 $678 $1,049 $600 $339 $160 $182 $74 $0 $21 $1,377 $9 $778 $0 $0 $787 $590 $715 $352 $86 $210 $94 $22 $21 $1,499 $14 $1,609 $9 $55 $1,687 ($188) $715 $355 $86 $210 $94 $45 $21 $1,525 $14 $1,027 $19 $55 $1,115 $410 $715 $367 $86 $210 $94 $45 $22 $1,539 $14 $1,257 $19 $55 $1,345 $194 $715 $375 $86 $210 $94 $45 $23 $1,547 $14 $1,342 $19 $55 $1,430 $117 $715 $375 $86 $210 $94 $45 $24 $1,548 $15 $1,428 $19 $55 $1,516 $32
OPERATING PROFIT FINANCIAL REVENUES (NON-OPERATING) MISCELLANEOUS
$149
$106
$209
$241
$246
$248
$249
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - UNREGULATED ACTIVITIES
$1,198
$696
$22
$651
$440
$365
$281
NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES - COMBINED ACTIVITIES
($993)
($3,582)
($13,597)
($25,121)
($36,410)
($47,826)
($59,135)
January 9, 2013
Page 439
AppendixG
WaterQualityMasterPlanVersion2
tkk Halifax Water

January 9, 2013
Page 441
t.JCJ Halifax 1 1 Water

WATER QUALITY MASTER PLAN Version 2.0
Prepared by: Alisha Knowles, B.Eng., EIT, PhD Water Quality Manager May 2011 1
Water Quality Master Plan May 2011 Page 2
ZKV Halifax Water
Introduction Halifax Water has consistently produced drinking water that has safeguarded public health and achieved regulatory compliance, despite the challenges that occur as regulations become more stringent, infrastructure ages and once current technologies are eclipsed by more modern ones designed to meet the new regulatory environment.. One important tool Halifax Water uses iswater quality strategic planning which is formally executed through a Water Quality Master Plan (WQMP). Water quality master planning describes the process whereby a water utility assesses the publics expectations for water quality and the direction of water quality regulations and trends, sets corresponding water quality goals and then plans for necessary capital or operational improvements. One of the major benefits of implementing a WQMP is the opportunity to be compliant with new regulations before they are introduced. In 2006, Halifax Water completed its first formal Water Quality Master Plan (WQMP) document to be used as a roadmap to make sure we continue to provide the best quality water for the foreseeable future. This plan was designed to set goals for water quality that exceed regulatory requirements and to set a path for Halifax Water to achieve those goals while treating water at an optimal cost. The WQMP focused on upgrades and investigations concerning the JD Kline Water Treatment Plant; Halifax Waters most mature treatment facility. The research plan proposed to achieve these goals focused on optimization projects that would result in improvements with a low capital or operating cost. Therefore, improvements to the existing plant processes were evaluated before alternative treatment technologies were considered, thus, avoiding tens of millions of dollars in unnecessary capital and operating expenditures. Water quality master planning and the associated research activities ensures that Halifax Water remains proactive in developing organizational action plans for regulatory compliance and establishing budget priorities based on sound research supporting Halifax Waters strategic plan and corporate water quality objectives. Although the WQMP identified several potential strategies for upgrading the JD Kline facility, a central item prior to implementing any strategy or technological solution was to implement a long-term research program and a plan for executing the research plan. In 2007, Halifax Water entered into a 3-year research agreement, valued at $400,000, with Dr. Graham Gagnon of Dalhousie University to execute the research tasks as described in the WQMP research plan. Based on Halifax Waters commitment to fund a research agreement with Dalhousie University, Dr. Gagnon was awarded a prestigious 5-year NSERC Industrial Research Chair in water quality and treatment, matching Halifax Waters funding contribution. Since many of the research tasks focused on process improvements at the JD Kline facility, in the summer of 2007, Halifax Water constructed a pilot water treatment plant, valued at $600,000, at this facility to be used as an investigative tool in the implementation of this research program. In the fall of 2007, the research team commissioned the pilot plant and has been conducting research at the facility since that time. In 2009, Halifax Water extended the research agreement for an additional 2 years to take advantage of additional NSERC funding, and to fully complete the initial phase of the research program. The pilot plant and research collaboration with Dalhousie presented a unique opportunity for Halifax Water to develop effective treatment solutions for their facilities to meet 2
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future demands and regulations. As an extension of this research partnership, Halifax Water is making an annual contribution of $70,000 over seven years to Dr. Gagnons new, state of the art Clean Water Laboratory at Dalhousie University and return is receiving access to laboratory facilities and staff. In addition to matching the research agreement contribution of Halifax Water, NSERC also matches our laboratory contribution. The WQMP has been a key tool in establishing water quality goals and setting a baseline for monitoring progress toward these goals. In the original WQMP, a number of tasks were identified in the research plan as a means of achieving such goals. There has been much success in completing a number of these tasks and Halifax Water has already adopted some process operational changes and is currently investing in some capital upgrades as a direct result of research conducted as part of this program. In the same manner, as expected, a number of WQMP research tasks that were included in the previous plan have been identified, through either internal or external research, as being no longer necessary or suitable for implementation at Halifax Water facilities. April 1, 2011, marked the beginning of the fifth, and final, year of the initial term of the NSERC Research Chair and WQMP research program. Based on almost 5 years of progress and lessons learned during the implementation of the original WQMP, Halifax Water has reached a in the research program and has recently evaluated the overall progress and outcomes of the program and developed a new WQMP thats includes updated water quality goals and redefined research tasks to guide the utility throughout the next phase of research. In doing so, Halifax Water assessed the needs of its water treatment facilities, the effectiveness of its current water quality monitoring programs and current trends in water quality regulations and research. To that end, several new research tasks have been added to the revised research plan to re-focus and update the direction and required outcomes of the WQMP. WQMP V2 has been developed based on the assumption that a 5-year research agreement will be renewed with Dalhousie University and they will conduct the experiments described in the research plan. This document will present the overall research accomplishments resulting from WQMP V1 and direct implications of this research to Halifax Water. In addition, a revised WQMP, WQMP V2, will be presented which will outline the overall direction of the research program, new water quality goals and outline the tasks identified to achieve these goals. This document also outlines the WQMP V2 implementation and execution plan and the structure of the research team, key support staff and associated committees. Research Accomplishments JD Kline Water Treatment Plant Research To date, the focus of research being conducted under the Research Chair has largely been on upgrades and investigations concerning the JD Kline Water Treatment Plant. Research tasks focused on addressing research needs at this facility to ensure that the plant will be able to maintain treatment performance in an increasingly volatile regulatory regime, despite the advancing age of this facility. Research tasks were completed largely by the Dalhousie Research 3
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Team with support from treatment plant operations staff. All research projects completed to date are building on our understanding of the JD Kline treatment process and are serving to improve the performance and adaptability of the treatment plant. Key research tasks completed to date under the Research Chair are listed below along with their overall impact to Halifax Water operations. 1. Computational fluid dynamics (CFD) modeling determined that the flocculation tanks at the JD Kline plant are not optimized for contaminant removal and that increased efficiencies can be sought; a direct result of a dated design and the plant not achieving design flow rates in the hydraulic flocculators. The identification of short-circuiting and inadequate mixing regimes within these tanks has presented the opportunity to make mixing and coagulation improvements, including the addition of mechanical flocculation. This research project has had direct and immediate impact on Halifax Waters flocculation process step. It has led the utility to conduct a pre-design study to determine the cost and energy implications of installing mechanical flocculators. The results from the pre-design study will provide Halifax Water with a budget envelope for estimating capital and operational costs associated with mechanical flocculation. Assuming that this capital project goes forward, Dr. Gagnons team will conduct a mixing study to estimate the impact of mixing rates of fluid and particle flow under different mixing conditions. This research finding and the proposed installation of mechanical flocculators has presented the team with a window of opportunity for major advancements toward achieving target water quality goals, such as improved particle removal and disinfection by-product reductions, and providing additional operational control and improvements. 2. An investigation of alternate coagulants was completed to optimize the removal of particles, natural organic matter and subsequent disinfection by-product formation reductions at the JD Kline treatment plant. Research completed to date has found that alternate coagulants are not a viable option for achieving increased NOM removal without comprising filtration performance at this direct filtration facility. In addition, the alternate coagulants evaluated did not provide any significant potential for improved particle removal at this facility. Nevertheless, it was identified that the pilot plant treatment process produces water quality with lower DBP formation potential than the full scale plant, highlighting the superior performance of mechanical mixing, as opposed to hydraulic flocculation. Due to the mixing benefits associated with mechanical flocculation in the pilot plant, aluminum sulfate coagulation in the pilot plant was achieving lower disinfection by-product formation potentials than the full scale plant. This enhanced performance suggests that aluminum sulfate coagulation can be optimized for improved performance once the mixing inefficiencies are addressed in the full-scale plant. Aluminum sulfate coagulation and mechanical mixing optimization studies are included as research tasks in the revised WQMP. 3. A study was completed to investigate the role a coagulant change would have in causing a significant effect with respect to lead leaching in drinking water. Both residual particulate 4
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iron and aluminum concentrations and chloride to sulfate mass ratio (CSMR) levels following coagulation were found to be significant factors contributing to lead release in galvanic settings following coagulation changeovers. The results of this study highlight the importance of evaluating downstream impacts of seemingly innocuous changes in coagulant type or dosage to obtain optimal coagulation performance, particularly when partial replacements are considered. 4. A QMRA study was completed using the Cryptosporidium, Giardia and E.coli source water monitoring results that were obtained through a separate WQMP internal research task. The QMRA work demonstrated that the JD Kline plant is capable of meeting acceptable risk levels, even considering worst case initial conditions, based on assuming worst case initial values for these contaminants in the watershed. 5. Naural organic matter characterization was completed on both the raw and treated water at the JD Kline facility. This work provided a clear picture of the seasonal impacts of organic matter content in the watershed and the overall performance of the treatment process in terms of removing specific organic fractions. This work will be used to guide the coagulation optimization tasks included in the revised research plan including alum coagulation optimization, a pre-chlorination evaluation and the potential of biological filtration. 6. Dalhousie University supported a regulatory research task driven by the absence of filter-towaste at the Pockwock treatment plant, which is considered non-compliant under the Province of Nova Scotias Drinking Water Strategy. As part of Halifax Waters plan to achieve compliance, Nova Scotia Environment (NSE) required Halifax Water to evaluate alternative means of managing filter ripening and to conduct microbial risk analysis. Based on both pilot and full scale studies, it was concluded that filter resting is indeed reducing risks associated with particle breakthrough during filter ripening sequences and should be continued as an operational alternative for the Pockwock treatment facility. Microbial sampling of Cryptosporidium, Giardia and E.coli during filter ripening events provided further evidence there is no microbial risks associated with the absence of filter-to-waste capabilities at this facility. System-wide Source Water, Treatment and Distribution Water Quality Tasks In addition to the JDKWSP research tasks, there were several tasks directed towards establishing water quality monitoring programs to track performance towards specific water quality goals set forth by Halifax Water in the original WQMP. All of the tasks associated with the implementation of advanced water quality monitoring programs have been either successfully completed or implemented as regular monitoring programs by the utility. Interestingly, some of the programs have either become regulatory requirements or are on the radar of local regulators, since the completion of the WQMP. Details of the following monitoring programs that have been adopted by Halifax Water as a result of water quality master planning can be found in Appendix A: 5
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1. 2. 3. 4. 5. 6.
EPA Source Water Monitoring for Crypto/Giardia Source Water Monitoring Programs International Water Treatment Alliance (IWTA) Program for Filtration Performance Chlorine Residual Profiling EPA Initial Distribution System Evaluation (IDSE) Real Time CT Monitoring
Water Quality Master Plan Direction Overall Direction Although the overall water quality goals identified in the original WQMP remain on the priority list of Halifax Water, there are other water quality objectives that the utility has identified as being significant to improving or strengthening water quality management and performance within the utility. Substantial efforts will be placed on shifting the focus of Halifax Waters strategic planning partially away from long term WQ goals more towards what can be done to support treatment plant operations and improve water quality from a day to day perspective. To date, the research program has focused on optimized treatment processes for the JDKWSP. Although several tasks will remain focused on improvements for the JDKWSP, several research requirements have been identified in other Halifax Water treatment facilities to address operational challenges and treatment issues. In addition, research efforts will also be focused on adapting a more pro-active approach to monitoring and optimizing both treatment operations and water quality and focusing efforts towards monitoring and understanding distribution water quality and performance. Finally, substantial efforts will be made to implement sustainable processes and optimize energy demands during the implementation of all research findings. Water Quality and Treatment Operational and Water Quality Goals. Although effluent water quality at each treatment facility consistently meets regulatory requirements, Halifax Water has set progressive internal water quality goals that go above and beyond regulatory requirements. Halifax Water has identified a significant opportunity for the optimization of day to day operations and is, therefore, interested in taking internal goal setting one step further and setting progressive operational and performance goals at each treatment facility for individual treatment processes (i.e.; filter backwash and operational goals, coagulation operational goals and set-points, etc). These goals would aid in shifting some of the focus off of the overall quality of the end product and working to optimize individual process operations and intermittent water quality. Another direct benefit of setting process specific goals is the opportunity to develop action levels that will act as triggers for operational responses to avoid potential non-compliance events. These goals need to remain simple and realistic and will only be achievable with appropriate operational commitment and changes. Advocating and Training. A major component of implementing operational goals within treatment facilities will be building the required commitment and support of operations staff 6
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within each facility. Therefore, a large component of this program will be implementing internal training programs for operations staff to ensure they understand their responsibilities in achieving these goals, but most importantly, to ensure that have the adequate education and resources to do this. Training will be focused on increasing operator capabilities to generate, interpret and manage water quality information and how they can directly apply this information towards achieving the water quality targets for their specific utility. Instilling a water quality culture based on continuous improvement and optimization will ensure we move away from complacent operations towards pro-active operations driven by optimization and performance goals. Water Quality Performance Monitoring. In order for plant optimization efforts to be effective, a performance baseline will need to be established by means of implementing a water quality and treatment performance monitoring program at each facility. Substantial amounts of operational and water quality data are generated and recorded on a continuous basis, however this information is not currently being used to its full potential. Currently, facilities are generating volumes of data to satisfy regulatory goals but little effort is focused on interpreting that data and using it to optimize and monitor treatment plant operations and water quality objectives. This information needs to be organized and analyzed in a manner that will make it actionable information that can be used as an indication of plant performance, to guide plant operations and identify optimization opportunities. Adapting a pro-active approach to both water quality monitoring and operations will ensure water quality information is not just collected, but is being actively organized and assessed to both monitor overall water quality performance and identify potential non-compliance events well before they occur. Distribution System Water Quality Historically, within Halifax Water and the water industry as a whole, distribution system water quality has received less attention than treatment process operations and performance. Recently, there has been an increased focus on possible risk factors to public health associated with distribution systems, a good example of this is the recent attention being focused the health risks associated with lead pipe in the distribution systems and the lack of understanding of the appropriate methods to replace such materials without presenting additional health risks to people directly affected by replacement efforts. In light of the increasingly stringent regulations surrounding distribution water quality and to remain loyal to the multi-barrier approach to water quality management, Halifax Water will direct efforts towards actively monitoring and assessing both distribution system water quality and physical integrity and understanding the interrelationships between the two. Establishing a baseline of distribution water quality, hydraulic and integrity information will allow for the utility to integrate water quality and hydraulic goals into the operation of the distribution system and focus attention on identifying and mitigating areas that are a high risk for contamination or sensitive to significant effluent quality fluctuations. The results of the monitoring program will be used to improve distribution system practices and implement another layer of protection to public health.
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Research Opportunities identified through WQMP Outcomes There have been several research tasks identified as a direct outcome of research projects conducted in response to the tasks outlined in the original WQMP. In particular, the Alternate Coagulant Studies and Mixing and Flocculation Studies have shown that inadequate mixing is negatively impacting treatment performance. These tasks clearly identified the overall direction of key treatment optimization tasks to achieve improved particle and DBP removal at the JDKWSP. Differences in DBP formation potential between the full-scale plant and pilot plant are indicative that upgrading to mechanical mixing in the full-scale could indeed yield substantial DBP reductions in treated water. Therefore, a task in the new research plan will evaluate variable mechanical mixing conditions in the pilot plant to identify the optimal mixing intensities required to enhance organic matter removal and, subsequently, reduce DBPs at this facility while maintain adequate particle removals. As mentioned above, a pilot-scale evaluation of the effects of mixing on particle and organic matter removal using the Alum is currently being carried out. During the Alternate Coagulant Studies task, substantial differences were indentified between DBPfps achieved during bench-scale and pilot plant experiments simulating the baseline coagulation pH and dosage conditions of the FSP. The key difference between these experiments was the absence of pre-chlorination during bench-scale experiments, which is currently employed during both pilot-scale and full-scale treatment. If the utility did not depend on pre-chlorination for microbial control during filtration at the JDKWSP, there is the potential that significant decreases in DBPs could be realized, as eliminating pre-chlorination is an effective way to control DBP levels in finished water. Therefore, a new research task has been added to evaluate potential DBP reductions that can be achieved through eliminating prechlorination practices in the FSP. As part of this investigation, the option of operating biologically active filters could also be examined for this facility, which may lead to further removal of biodegradable NOM, which are typically recalcitrant to coagulation treatment. If biologically active filters are identified as posing too high of a threat to microbial contamination at this facility, chlorination could be add to filter backwash water to act as a filter aid for microbial control in the filters. In addition, many of the broad monitoring programs established through the completion of specific WQMP tasks over the past 5 years have established a significant baseline inventory of key water quality performance indicators of source water, treatment and distribution water quality. This information will be used during future optimization initiatives and to monitor the performance of the research tasks ahead. The analysis and understanding of the results of such monitoring programs also enables the utility to proactively assess risks and enable for early detection of possible non-compliance events. To that end, several other water quality monitoring programs are targeted to be developed and implemented during the next phase of this WQMP.
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Revised Water Quality Goals In the original WQMP, Halifax Water established and adopted internal water quality goals. These goals were based on the outcomes of the WQMP study combined with what has been achieved by other best in class utilities that have adopted similar programs. These goals are intended to ensure that Halifax Water not only meets current regulatory requirements, but will be well positioned to meet predicted regulatory changes and maintain water quality that well exceeds the current regulatory requirements. Though many of these goals remain the same, there are some additional goals being added to this version of the WQMP to reflect overall direction and focus of the WQMP and to set a standard for the associated research tasks. Many of these goals are a product of the utilities commitment to adapting a more proactive approach to water quality management, monitoring and optimization. Halifax Water has developed both global and specific water quality goals. The global goals are very general and are intended to describe the overall objectives of the specific water quality goals. The specific goals clearly define measurable objectives associated with priority water quality targets identified by Halifax Water. The following global and specific goals will be evaluated by the Water Quality before they are formally adopted by the utility. Global Goals: Compliance Full compliance with Guidelines for Canadian Drinking Water Quality. Full permit compliance Source Water Quality Proactively protect our source water quality. Monitor source water quality to provide early warning of potential problems. Water Quality and Treatment Adapt a pro-active approach to water quality monitoring and operations. Develop indicators of pending non-compliance events. Provide required training to improve operator knowledge of operational, treatment and water quality objectives. Actively optimize treatment processes through monitoring and assessing the relationship between treatment operations and effluent water quality. Develop facility specific water quality and operational goals. Distribution System Water Quality Integrate water quality goals into the operation of the distribution system. Actively monitor and understand water quality and physical integrity in the distribution system. 9
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Identify distribution system contamination vulnerabilities and clearly identify communication plans, responsibilities and accountabilities.
Customer Expectations Maintain customer perception of water quality that exceeds corporate strategic objectives. Incorporate our understanding of customer perspectives when developing overall water quality goals. Specific Goals: Particle/Precursor Removal Goals: These goals describe HRWCs efforts to optimize the basic treatment process to improve particle removal, which is the fundamental pathogen barrier, while at the same time also optimizing for TOC removal. 2 to 3 log removal of giardia by filtration 3/4/4 log removal for giardia/viruses/cryptosporidium Individual filter turbidity values <0.1NTU: 95%, 0.3 NTU: 100%
DBP Goals: These goals describe how HRWC will improve disinfection which is one of the primary barriers to protect public health, while at the same time also lowering disinfection byproducts such as THMs and HAAs. THMs < 80 ug/L (LRAA) HAAs < 60 ug/L (LRAA)
Distribution Water Quality Goals: These goals recognize that water quality is managed not only at the treatment plant but also to the customers tap. They also recognize that the distribution system and water quality can positively or negatively affect each other. Distribution residual of 0.2 mg/L at all locations Develop and achieve distribution system HPC targets Maintain 90th percentile residential lead levels below 15-g/L
Waste Treatment Goals: These goals recognize that plant waste processing is a significant operating cost and that waste management costs can be impacted by process changes. While secondary to public health issues, plant process improvements must also consider the impact on waste treatment. Optimize residual disposal costs Achieve wastewater permit requirement
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Overall Strategy to Achieve Goals Based on the research findings to date and an overview of industry best practices, Halifax Water has identified a number of tasks to be carried out to achieve the goals outlined above and to address facility specific and system wide operational and treatment challenges that have been identified since the initial WQMP was completed. Some tasks will serve to achieve multiple goals and others are focused on very specific research tasks pertaining to the optimization if a specific treatment process. These tasks take the form of several different types of activities such as the following: Pilot scale research studies. Consultant studies. Data collection and surveillance techniques. Long-term monitoring programs. Best practice adoption. Operational changes. Training programs.
Some tasks we be completed by means of a well-defined research project over a relatively short period of time and others, specifically treatment and distribution monitoring and optimization programs, will require a significantly larger time commitment. Such programs encompass multiple planning, development and implementation stages which may include identifying and setting achievable and realistic goals, the development and implementation of monitoring programs, baseline performance assessments, operator training programs, and the development of optimization plans, to name a few. All of the tasks have been organized into the WQMP research plan. This plan recognizes that there are inter relationships between the tasks. The research tasks are developed into an implementation plan in a logical order, designed to achieve the water quality goals at the least overall cost. Tasks that are seen as a priority due to extreme operational problems or pending regulatory requirements will be given priority for completion. Tasks that result in less expensive plant improvements will be completed first. Also, plant improvements are maximized prior to trying to implement operational changes in the distribution system. The intent is to execute the implementation plan to the point where the goals are achieved. Since the goals represent a stateof the-art in water quality, stopping at that point represents achieving maximum benefit at least cost. Appendix B to this document is a detailed description of each of the tasks identified in the implementation plan. This listing and description of tasks is known as the Research Plan. This implementation plan is illustrated in Appendix C. The implementation plan is planned to be completely executed by 2015. As implementation plan tasks are completed, process changes, some resulting in capital projects, will be identified. These modifications will be scheduled as resources and financing allow. 11
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Research Plan and Execution The overall program will be governed by a steering committee consisting of Halifax Water staff, Dalhousie staff, and the owners engineer. The steering committee will periodically review research projects and progress. The steering committee will meet quarterly to review research proposals for upcoming research and the results of previous and ongoing research. At this time,Dalhousie will present detailed research results in a seminar format to the steering committee and Halifax Water staff that are directly impacted by the particular research tasks. Technical reports will be submitted as requested for specific research tasks. Sarah Clark, P. Eng., of HDR Engineering, Denver CO, will continue as owners engineer for the program. Sarah Clark is a water treatment specialist and has previously led a program similar to this one for a US utility. Depending on the specific research and expertise requirements, individual research tasks will be executed either internally by Halifax Water staff or externally by the Dalhousie University research team or external consultants, as required. Halifax Water Research Team. Tasks that involve the optimization of day-to-day process operations or monitoring programs will be completed internally using in-house staff and resources. The primary staff members responsible for specific research tasks are clearly identified in the implementation plan. One key step the utility has taken to solidify its commitment to sound water quality management was the recent retainment of a water quality manager. The Water Quality Manager has been assigned a leadership role in the provision of high quality drinking water; specifically related to treatment, water quality and distribution operations optimization, monitoring and research. This person will play a lead role in conducting water quality research, solving water quality, treatment and distribution problems, pro-actively monitoring and improving treatment and distribution operations and methodologies, and developing, implementing and monitoring water quality plans. In addition, Halifax Water has acquired an Energy Efficiency Engineer who will been consulted when reviewing recommendations for operational and/or capital improvements that have been identified through the tasks set forth in this plan. The addition of a Water Quality Manager has afforded the utility the appropriate advocate for the development and implementation of water quality strategic plans and research programs. However, implementation of these programs will require cooperation and commitment of several other stakeholders within the utility structure including the general management, plant managers and operations superintendents, distribution superintendents, and all directly impacted operations staff. A Water Quality Committee is currently in the early stages of development and, once established, will serve to actively review the progress of the overall research plan, determine the overall progress towards specific water quality goals and will also play a key role in evaluating 12
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the progress and performance of internal research tasks. This committee will also be responsible for contributing to the development and approval of operational treatment and distribution goals developed as outcomes of internal research tasks that are focused on actively monitoring and optimizing treatment and distribution operations. Dalhousie Research Team. Tasks that require significant bench and/or pilot-scale research experiments, such as individual process optimization projects that are evaluating alternate operational techniques or physical or chemical processes will be carried out by the Dalhousie Research team. The Dalhousie team will be lead by Dr. Graham Gagnon. Dr. Gagnon is an Associate Professor of Civil Engineering and Canada Research Chair in Water Quality and Treatment, based at Dalhousie. Dr. Gagnon is a water quality researcher of international reputation and has for several years conducted research using HRWC facilities. Contracting with Dalhousie has several advantages over Halifax Water conducting the research by hiring staff: Research is led by a prominent and skilled researcher. Dr. Gagnons stature as a leading drinking water researcher in North America has grown since beginning this research project and, in part, as a result of the research project. If required, access is available to Dr. Gagnons North American wide network of researchers and associates. Throughout the current research program, Halifax Water has been involved as participants in both national and international research studies that are well-aligned with our WQMP goals and have been led by leading researchers in North America such as Mark Edwards, Jennifer Clancy, Lisa Raigan, Michelle Prevost and more recently 2011 AWWA AP Black Research Award winner Michael Schock. Compared to staffing internally, flexibility is provided to staff up or staff down or use staff with different expertise depending on the project demands. Dr. Gagnon has proven his capabilities in recruiting highly skilled researchers to participate in the research program, all with specific interests in areas of expertise, such as source water protection, coagulation chemistry, filtration, microbiology, etc. A strategic relationship with Dalhousie has proven to provide several ongoing benefits to Halifax Water such as support with operational or regulatory driven projects outside of the research program and the dissemination of Halifax Water research results to the water community at several prestigious conferences and workshops. The Dalhousie research team has developed invaluable background experience with Halifax Water treatment processes and operations staff throughout this research program that will undoubtedly be used as we move forward with the second phase of research. There is a strong history of knowledge transfer between Halifax water staff and graduate student researchers. Halifax Water staff has benefited from the day to day interactions with the research team and, similarly, the research team has benefited from the daily interactions with the Dalhousie research staff. There is a strong potential for the Halifax Water research contribution to be matched pending the successful renewal of the Halifax Water/NSERC Industrial Research Chair. 13
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Halifax Water is excited to continue working with the Dalhousie Research Team as this research program is carried forward. Benefits of this research partnership have exceeded expectations in that Halifax Water staff are benefiting from the day to day interaction with the research team and similarly the research team is benefiting from daily interaction with operations staff. Halifax Water is extremely pleased with the overall results of the research program that was carried out under WQMP V1 and the quality of the work being produced. The overall progress and research findings are evidence that the research agreement with Dalhousie University achieved its intended goals, not the least of which is providing improved water quality and reduced treatment costs for Halifax Water customers. Consulting Engineers. As required, Halifax Water will retain a consulting engineering team either to carry out a specific research tasks or to complete a third party review and evaluation of promising research results and analyze its potential and capability based on the ease, cost and risk of implementation at full plant scale. Phase II Implementation As promising research results are identified, Halifax Water will be in a position to begin planning for phase II implementation of these findings. Phase II is the stage where significant capital improvements are adopted. Once the scale and scope of optimum candidate projects is understood, the capital improvements can be incorporated in Halifax Waters business planning and rate application processing. The Steering Committee and Water Quality Committee will determine the appropriate timing for Phase II implementation reviews to occur based on the overall research tasks complete and the overall potential for water quality and improvements in operational costs. In reality there will be a number of recommendations that will be adopted much more quickly. In general, research recommendations will be dealt with as follows: Recommendations which offer a process improvement at the expense of only an operational or procedural change will be adopted immediately. Recommendations that require only minor capital resource will generally be adopted in the next fiscal year. Major capital initiatives will be held for analysis with other candidate projects. The optimal project will be selected and the project introduced into Halifax Waters capital planning cycle.
Any process change or capital improvement will be accepted only after it is demonstrated that there is no adverse public health risk, and after necessary approvals are obtained. The intent of Phase II is to fully meet the water quality goals and optimize capital and operating costs.
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Appendix A
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JD Kline Water Treatment Plant Research To date, the focus of the WQMP research program has largely been on upgrades and investigations concerning the JD Kline Water Treatment Plant (JDKWSP); Halifax Waters most mature treatment facility. Research tasks focused on addressing research needs at this facility to ensure that the JDKWSP will be able to maintain treatment performance in an increasingly volatile regulatory regime, despite the advancing age of this facility. Carefully planning for future demands and regulatory changes will ensure that the facility is maintained and upgraded in a sustainable manner. Optimization tasks were completed largely by the research team with support for treatment plant operations staff. The following section outlines the overall findings and operational or water quality impacts of tasks that have either been completed or significant progress has been made towards the intended objectives: Construct Pilot Plant. In the summer of 2007, Halifax Water constructed a pilot-scale treatment plant at the JDKWSP to be used as an investigative tool in the implementation of this research plan. The pilot-scale water treatment plant operates using plant raw water at a design flow of 15 LPM and contains two separate treatment trains, capable of duplicating the direct filtration process currently operating at the JDKWSP. Two identical treatment trains are being used in the pilot study to ensure that the effects of changing raw water characteristics are eliminated by continuously operating one side of the plant such that the same finished water quality as the fullscale plant (FSP) is continuously achieved The fully automated plant has the flexibility to modify process variables such as mixing energy, detention times, overflow rates and filtration rate and the capability to extract water samples at any location in the treatment process and to introduce coagulated, flocculated or settled water from the existing treatment plant. The pilot plant chemical system is capable of storing and feeding currently used chemicals and a wide spectrum of potential chemicals over a wide range of dosages. The plant contains inline equipment to monitor temperature, pH, turbidity and particle counts at all critical process control points. Prove Pilot Plant. Following pilot plant installation, both commissioning and proving processes were completed. The commissioning process ensured the plant was installed and operating according to design specifications and the proving process served to confirm that equivalent intermittent and finished water quality was demonstrated between both the parallel pilot trains and the full-scale plant. The commissioning process involved a systematic approach designed to ensure that the pilot plant performed according to design specifications and satisfies all operational and research requirements. Commissioning tasks included equipment calibration, programming adjustments, chemical feed modifications and process fine-tuning. Several critical issues, such as lime feed and backwash problems, were quickly recognized and recommended solutions were subsequently identified and implemented by the research team and Halifax Water support staff. The pilot plant was commissioned in the fall of 2007. Next, successive proving trials demonstrated equivalence in multiple water quality parameters between the parallel pilot trains and between the two treatment scales. The validation process successfully demonstrated that the pilot plant has the ability to reproduce full-scale behavior and that the results of the pilot research at this facility are in fact real and representative of process 16
changes that, when implemented at full scale, will successfully optimize the performance of the full-scale plant. The proving process was conducted during February through August, 2008. Alternate Coagulant Studies. There has been significant activity under this WQMP task which investigates alternate coagulants for the removal of particles, natural organic matter (NOM) and subsequent disinfection by-product (DBP) formation. Coagulation optimization research included extensive bench and pilot testing of alternative coagulants including polyaluminum chloride (PACl), aluminum chlorohydrate (ACH) and ferric sulfate using countless combinations of coagulation pH and dosages. The plant currently uses aluminum sulfate (alum) for coagulation purposes. Results from pilot-testing demonstrated that the optimal conditions for NOM control from bench-scale testing are not consistent with optimal filtered water particle removal objectives. Consequently, alternate coagulant conditions that looked promising for increased NOM removal following bench scale experiments did not perform markedly different than the current alum coagulation performance for NOM removal when operating at conditions necessary to obtain acceptable filtration performance during pilot operations. Research completed to date has found that alternate coagulants are not a viable option for achieving increased NOM removal without comprising filtration performance at this direct filtration facility. In addition, the alternate coagulants evaluated did not provide any significant potential for improved particle removal at this facility. Nevertheless, it was identified that the plot plant treatment process produces water quality with reduced DBP formation potential due to the differences in mixing regimes between the two scales of treatment. This work supports the findings of the mixing studies that were completed on the hydraulic flocculators, as discussed under the Mixing and Flocculation Studies progress update. Currently, pilot testing is underway to optimize the performance of alum coagulation practices at the JDKWSP. The current tests are investigating optimal pH, dosage and mixing conditions to be utilized during alum coagulation and determine if optimal performance using the coagulant will reduce DBP formation potential. This research task is included in the revised WQMP research plan. In addition, bench-scale experiments investigated the role a coagulant change would have in causing a significant effect with respect to lead leaching in drinking water. Both residual particulate iron and aluminum concentrations and chloride to sulfate mas ration (CSMR) levels following coagulation were found to be significant factors contributing to lead release in galvanic settings. Under multiple treatment conditions, ferric sulfate was consistently the most corrosive coagulant tested followed by PACl and Alum. The results of this study highlight the importance of evaluating downstream impacts of seemingly innocuous changes in coagulant type or dosage to obtain optimal coagulation performance. Mixing and Flocculation Studies. Computational fluid dynamics (CFD) has been used to evaluate the mixing regimes currently achieved by the hydraulic flocculation tanks at the JDKWSP. It has been determined that the flocculation tanks are not optimized for contaminant removal and that increased efficiencies can be sought; a direct result of a dated design and the plant not achieving design flow rates in the hydraulic flocculators. The combination of shortcircuiting and inadequate mixing regimes within these tanks has presented the opportunity to make mixing and coagulation improvements, including the addition of mechanical flocculation 17
Mechanical/Hydraulic Assessment. As a direct result of the research findings in the Mixing and Flocculation Studies task, a consultant evaluation of the existing mixing regimes in the full scale process was conducted (HDR, 2010) and resulted in several process modifications to improve the overall performance of the plant, including mixing upgrades to the pre-mix tanks, flow splitting improvements and the addition of mechanical flocculation capabilities. An RFP for the detailed design of the upgrades recommended in this report is the next step towards this goal. Filter Operational Strategy and Flow Control (Pilot). Backwash procedures are being optimized to minimize filter ripening times at JDKWSP. Research completed to date has shown that there are minimal microbial risks in current filter ripening practices. However, these practices can still be optimized to obtain shorter backwash time and shorter start-up conditions. The benefit of these steps would be less water and energy consumption, as well as less wastewater to treat from the plant. Once pilot research is complete and filter operational recommendations are submitted by the research team, the findings will be reviewed by an external consultant to identify operational requirements as outlined under the Filter Operational Strategy and Flow Control (Consultant Facilitated) task. Filter-to-Waste Benefit/Risk Study (NSE). This task was a high priority for Halifax Water since the absence of filter-to-waste at the Pockwock treatment plant was considered noncompliant under the Province of Nova Scotias Drinking Water Strategy requirements that had to be met by April 1, 2008. As part of Halifax Waters plan to achive compliance, Nova Scotia Environment (NSE) required Halifax Water to evaluate alternative means of managing filter ripening and to conduct microbial risk analysis. As part of this research alternative operational means of reducing particle breakthrough and associated potential pathogen risks during filter ripening were evaluated. Both filter resting and Extended Terminal Subfluidization Wash (ETSW) procedures were evaluated and it was concluded that filter resting following a backwash procedure was the preferred approach for reducing particle breakthrough during the filter ripening sequence. Filter resting was implemented at the JDKWSP in January 2008. In addition to pilot studies, retrospective fullscale data comparing filter resting to unrested filter conditions was conducted and concluded that that filter resting reduced maximum turbidity values significantly during the filter ripening sequence. Based on the statistical analysis of pilot-plant studies and one full year of full scale operating data, it was concluded that filter resting is indeed reducing risks associated with particle breakthrough during filter ripening sequences and should be continued as an operational alternative for the Pockwock treatment faciltity. To further satisfy the requests of NSE, Cryptosporidium, Giardia and E.coli samples were monitored during the filter ripening stage at the Pockwock plant for one year. The microbial sampling provided further evidence there is no microbial risks associated with the absence of filter-to-waste capabilities at this facility. All risk assessments required by NSE were submitted to NSE in December 2011. Value-added Research. Additional research tasks were completed as part of the Halifax Water /NSERC Industrial research Chair held by Dr. Graham Gagnon at Dalhousie University. Three of these tasks will have direct impacts to Halifax Water and the overall direction of research at 18
the JDKWSP. A QMRA study was completed using the results from Cryptosporidium, Giardia and E.coli source water monitoring results that were obtained through a WQMP internal research task. All microbial cyst data obtained through the EPA Source Water Monitoring for Cryto/Giardia research task has been negative for the Pockwock watershed (i.e.; 0 cysts/ 100L). Despite the fact that these cysts were not present, the QMRA modeling work was based on assuming initial worst case initial values for these contaminants in the watershed. The QMRA work demonstrated that the plant is capable of meeting acceptable risk levels, even considering worst case initial conditions. In additional to microbial risk assessments, the research team also focused significant research effort on characterizing the organic matter content in the raw and treated water at the JDKWSP. Organic matter was characterized in terms of both the chemical composition and molecular weight distribution of the organic matter present. This work provided a clear picture of the seasonal impacts of organic matter content in the watershed and the overall performance of the treatment process in terms of removing specific organic fractions. This work will be used to guide the coagulation optimization tasks included in the revised research plan. The other significant contribution from Dr. Gagnons team, was the evaluation of the impacts chloramine and chlorine disinfection practices on lead release from distribution plumbing. Overall, chloramines showed a significantly higher corrosion potential based on the operating and dosing conditions studied. To that end, the evaluation of chloramines as a potential means of reducing DBPS was removed from future research plans. System-wide Source Water, Treatment and Distribution Water Quality Tasks In addition to the JDKWSP research tasks, there were several tasks directed towards establishing water quality monitoring programs to track performance towards specific water quality goals set forth by Halifax Water in the original WQMP. All of the tasks associated with the implementation of advanced water quality monitoring programs have been either successfully completed or implemented as regular monitoring programs by the utility. Interestingly, some of the programs have either become regulatory requirements or are on the radar of local regulators, since the completion of the WQMP. This highlights one of the main functions of strategic planning, which is to be one step ahead of regulatory requirements. Overall progress on individual water quality tasks are outlined below: EPA Source Water Monitoring for Crypto/Giardia. Halifax Water has adopted the USEPA Surface Water Assessment program to assess the microbiological risk of its water systems. This program consists of 24 consecutive monthly raw water samples for Giardia and Cryptosporidium. This program was initiated in June of 2008 at the JDKWSP and was completed in May 2010 with no detections of cryptosporidium or giardia for the duration of the program. The Lake Major facility began the surface water assessment program in July 2009 and will conclude in June of 2011. In addition, sampling of the Collins Park system commenced in June, 2010, with no detections to date. Source Water Monitoring Program. Halifax Water submitted risk-based source water protection plans to NSE for each of its water systems including Pockwock and Tomahawk Lakes, Lake Major and Long Lake, Bennery Lake, Middle Musquodoboit, Collins Park, Five Island Lake, Silver Sands, Miller Lake, Chain Lake and Lake Lamont. All of the water quality monitoring programs supporting these plans were implemented in 2009.
19
International Water Treatment Alliance. Halifax Water water completed the IWTA program with the objective of evaluating filtration performance at the JD Kline and Lake Major treatment plants, and also support optimization and continuous improvement at these treatment facilities. As participants in this program, Halifax Water was required to demonstrate that high levels of filter performance are being achieved and the capability to maintain these levels long term. The filter performance program included continuous online monitoring and the analysis of filtration data to demonstrate that individual filters produced filtered water turbidity was less than 0.10NTU 95% of the time, consistent filter performance was being achieved, maximum filtered water turbidity was less than 0.3-NTU and to confirm that CT objectives for the removal of giardia and viruses are being achieved. Both the JD Kline and Lake Major facilities successfully met all of these stringent performance goals and were subsequently awarded the 3-Star Excellence in Water Treatment Award in June of 2009. Chlorine Residual Profiling. All reservoirs across the distribution system are now equipped with a remote chlorine analyzer and chlorine residuals are continuously monitored in Halifax Waters online monitoring data storage system. The results from the analyzers are regularly monitored to identify operational and maintenance requirements. EPA Initial Distribution System Evaluation (IDSE). In 2008, Halifax Water began a THM and HAA monitoring program throughout the distribution system. THMs and HAAs are measured quarterly at 19 sampling sites throughout the Halifax Water distribution system. In 2010, the local running annual average (LRAAs) are below THM and HAA guidelines of 100g/L and 80-g/L, with the exception of one sampling site. The North Preston Community Center sampling site serviced by the Lake Major Water treatment plant has an LRAA above the guideline at 122-g/L due to rechlorination at the reservoir. Halifax Water will explore means to optimize the rechlorination process at this location to lower the THMs as part of the revised WQMP research plan. Real Time CT Monitoring. Real time CT monitoring was implemented at the Pockwock and Lake Major treatment plants in 2006. Online CT monitoring has allowed for the facilities to respond quickly to operational changes or anomalies that require CT to be subsequently adjusted to meet regulatory requirements. It has also identified some seasonal time frames in which the facilities need to carefully monitor CT trends to ensure regulatory requirements are consistently met. In response to numerous incidents involving water-borne contaminants, regulatory requirements for evaluating, monitoring and reporting disinfection performance are becoming more stringent in the water industry. In response to NSE recently requiring real-time CT monitoring in new operating permits, Halifax Water is currently implementing online CT monitoring at the Bennery Lake, 5 Island, Miller Lake and Silver Sands small system treatment plants.
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Appendix B
21
Water Quality Master Plan Version 2 Implementation
tkAHalifax i 1 Water
1
HRWC J. Douglas Kline Water Quality Master Plan Implementation
tIC.V, Halifax 1 1 Water
TABLE OF CONTENTS
Water Quality and Treatment ..................................................................................................... 3 Source Water Monitoring for Crypto and Giardia ...................................................................... 4 Source Water Protection Research .............................................................................................. 5 Organic Matter Monitoring Program .......................................................................................... 6 Water Quality/Treatment Performance Monitoring Programs.................................................... 7 Locational Operational and Water Quality Goals ....................................................................... 8 Operator Training Program ......................................................................................................... 9 Filter Monitoring and Optimization Program ........................................................................... 10 Filter Backwash Optimization and SOPs .................................................................................. 11 JD Kline Water Supply Plant .................................................................................................... 12 Flocculation Mechanical Mixing Studies .................................................................................. 13 Alum Coagulation/Coagulant Aid Optimization ...................................................................... 14 Chemistry Assessment and Finalization ................................................................................... 15 Filter Operational Strategy and Flow Control (Pilot)................................................................ 16 Filter Operational Strategy and Flow Control (Consultant Facilitated) .................................... 17 Pre-chlorination Evaluation....................................................................................................... 18 Advanced Pilot Studies ............................................................................................................. 19 Lake Major Water Supply Plant ............................................................................................... 20 Coagulation and Upflow Clarification Assessment .................................................................. 21 Residuals Handling Optimization ............................................................................................. 22 Bennery Lake Water Supply Plant ........................................................................................... 23 Process Optimization Study ...................................................................................................... 24 Distribution System Water Quality ........................................................................................... 25 Distribution System Water Quality and Integrity Monitoring .................................................. 26 Disinfection Efficiency and THM/HAA Removal Study ......................................................... 27 Adopt and Implement New Lead Policy ................................................................................... 28 Lead Service Line Replacement and Monitoring Program ....................................................... 29 Implement New Residential Lead Monitoring Program ........................................................... 30
***** 2
Water Quality and Treatment
3
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Source Water Quality Task: Source Water Monitoring for Crypto and Giardia
Description: In 2008, HW adopted the USEPA Surface Water Assessment program to assess the microbiological risk of its water systems. This program consists of 24 consecutive monthly raw water samples for giardia and cryptosporidium. This program monitoring program will be continue until all surface source waters have been monitored for a 2-year period and a benchmark to USEPA rules for the appropriate level of particle removal and Cryptosporidium inactivation is identified for each treatment system.
Primary Resource: WQ Inspectors Plant Operations Superintendent
Pre/Post Requisite: There are no prerequisites.
Schedule: On-going
Budget: $8,000/year
4
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Source Water Quality Task: Source Water Protection Research
Description: HW is anticipating participation in a Water Research Foundation (WaterRF) Tailored Collaboration pathogen monitoring project with Clancy Environmental to assist Nova Scotia Environment with identifying a practical way to identify and evaluate source water risk. In addition, HW is anticipating participation in an NSERC funded project to develop and validate tools for monitoring and assessing the microbial quality of the Collins Park and Middle Musquodoboit source waters. This project will be completed in parallel to and incorporate the results of the Source Water Monitoring for Crypto and Giardia task that will be completed for both watersheds over the next 3 years.
Primary Resource: WQ Inspectors Plant Operations Superintendent
Pre/Post Requisite: The NSERC study will be conducted in parallel with the Source Water Monitoring for Crypto and Giardia task.
Schedule: To be determined
Budget: To be determined
5
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Treatment Water Quality Task: Organic Matter Monitoring Program
/../(k Halifax 1 1 Water
Description: Due to stringent DBP regulations, organic matter removal has become an important treatment objective for drinking water plants. Although this is an important treatment goal, HW does not currently monitor organic matter removal as an operational objective. To develop an inventory of both raw water organic matter concentrations and the organic matter removals being achieved at HW facilities, an organics monitoring program will be implemented at the JD Kline, Lake Major and Bennery Lake treatment plants. This monitoring program will include weekly TOC, DOC and DBPfp and daily UV254 analysis. This information will be used to assess treatment plant performance and be used as a baseline for organic matter removal optimization studies.
Primary Resource: Treatment Plant Operators Plant Managers Water Quality Manager
Schedule: January 2012
Budget: On-going cost of staff and supplies. In-kind support from Dalhousie Research Lab.
6
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Water Quality and Treatment Task: Water Quality/Treatment Performance Monitoring Programs
Description: Halifax Water records substantial amounts of operational and water quality data on a continuous basis, however this information is not currently being used to its full potential. We are currently generating volumes of data to satisfy regulatory goals rather than interpreting that data and using it to optimize and monitor treatment plant operations and water quality objectives. The goal of this task is to develop a water quality/treatment performance monitoring program that will organize and simplify this information making it actionable information that can be used as an indication of plant performance, to guide plant operations and identify optimization opportunities.
Schedule: Begin developing capability in September 2011 and begin program in May 2012.
Budget: On-going cost of staff and software.
7
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Water Quality and Treatment Task: Locational Operational and Water Quality Goals
Description: In Version 1 of the WQMP, HW adopted long-term water quality goals to guide this research program and subsequent capital improvements at their facilities. As an outcome of Version 2, HW intends to develop locational operational and water quality goals for the JD Kline, Lake Major, and Bennery Lake treatment facilities. These goals will be developed based on anticipated outcomes of the WQMP and will be designed to push ahead of regulatory requirements. In addition, action levels will be established to trigger operational responses to avoid pending non-compliance as a result of unpredicted or particularly challenging treatment events. Establishing clear goals and providing technical direction to operational staff to be able to meet these goals is also a fundamental outcome of this program. In addition, monitoring programs will be designed to track performance of these goals.
Primary Resource: Treatment Plant Operators Plant Manager Water Quality Manager
Pre/Post Requisite: These goals will be developed and augmented based on research outcomes. One full year of monitoring results from the Water Quality/Treatment Performance Monitoring Programs is a prerequisite.
Schedule: Begin developing capability in January 2013.
8
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Water Quality and Treatment Task: Operator Training Program
Description: A formal internal training program will be developed to support the implementation of locational water quality goals and monitoring programs and to encourage the continued optimization of treatment processes on a daily basis. This training program will involve periodic presentations to provide operators with the necessary tools to be successful in the proposed monitoring and optimization tasks. Training sessions will focus on specific treatment processes, advanced operational techniques, surveillance and maintenance techniques, data collection and analysis, etc. HW will aim to have these training sessions accepted as formal Continued Education Training (CEU) sessions by NSE.
Primary Resource: Treatment Plant Operators Plant Manager Water Quality Manager
Schedule: Begin developing capability in January 2013.
9
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/ Precursor Removal Task: Filter Monitoring and Optimization Program
Water
Description: The main goal of this task is to continually monitor, assess and refine filtration performance by implementing filter surveillance techniques, augmenting filter maintenance programs, implementing a performance monitoring program and setting facility specific filter operational objectives and performance indicators. This task will not only ensure diseasecausing organisms are optimally removed from the raw water and aid in reducing and detecting possible violations, but it will also serve to minimize operational and maintenance costs and optimize filtration operations and performance. This program will aid in increasing operator preparedness and reducing operational complacency.
Schedule: Begin developing capabilities in July 2011 and implement in May 2012.
10
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/ Precursor Removal Task: Filter Backwash Optimization and SOPs
Description: Appropriate indicators of optimal filter backwashing procedures (i.e. individual steps and durations) will be developed along with optimized backwash SOPs for both the Bennery Lake and Lake Major WSPs. The main function of filter backwashing is to adequately clean the filter media; however it can also influence other phases of filter operations if it is not completed optimally. For instance, washing filters for an excessively long period of time can actually be detrimental to the backwash procedure and leads to post-backwash turbidity breakthrough and longer ripening times. Optimizing the backwash duration will not only yield reductions in ripening turbidity and duration, but significant water saving benefits will be realized through the reduction of backwash times and spent filter-to-waste volumes. Due to the sensitivity of direct filtration operations and the inability to filter-to-waste at the Pockwock facility, a separate task was developed for the optimization of filtration operations at that facility).
Primary Resource: Treatment Plant Operators Plant Water managers Plant Supervisors
Schedule: May 2012
11
JD Kline Water Supply Plant
12
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/Precursor Removal Task: Flocculation Mechanical Mixing Studies
Description: Upgrading to mechanical mixers in the flocculation process was identified as a potential means of improving NOM and particle removal at the JDKWSP. The combination of short-circuiting and inadequate mixing regimes within the flocculation tanks has presented the team with a window of opportunity for optimizing contaminant removals within the system through mixing optimization studies at the pilot-scale. This pilot work will look at mechanical flocculation energy required to achieve optimal filtration performance.
Primary Resource: Research Team
Pre/Post Requisite: This research will be completed in collaboration with the Alum Coagulation/ Coagulant Aid Optimization task.
Schedule:
August - October 2012: Warm weather pilot. February - March 2013: Cold weather pilot.
Budget: This work is part of an initial five year pilot program with a budget of $695,000.
13
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/Precursor Removal Task: Alum Coagulation/Coagulant Aid Optimization
Description: Following mechanical flocculation upgrades, the optimization of alum coagulation conditions will be required to ensure optimal organic matter and particle removals are being achieved. In addition, pilot operations have identified that polymer may not be required following mechanical mixing upgrades; therefore, alum coagulation conditions will need to be closely evaluated during cold water operations. If a coagulant aid is required, it may be necessary to review filter and coagulant aid polymers for improved particle and TOC removal performance. Aluminum residuals will need to be evaluated as a secondary objective of this task to ensure effluent wastewater regulatory requirements are effectively achieved.
Pre/Post Requisite: This research will be completed in collaboration with the Flocculation Mechanical Mixing Studies.
Schedule:
August - October 2012: Warm weather pilot. February - March 2013: Cold weather pilot.
Budget:
This work is part of an initial five year pilot program with a budget of $695,000.
14
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: DBP and Particle/Precursor Removal Task: Chemistry Assessment and Finalization
Description: At the conclusion of the pilot studies addressing chemistry, a comprehensive review of progress to date will take place. The intent is to review the success of pilot work, its applicability for full scale implementation and to determine if any interim findings can be implemented full scale.
Primary Resource: Research Team Consulting Team
Pre/Post Requisite: Chemistry pilots should be completed.
Schedule:
To be determined
Budget:
To be determined
15
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/Precursor Removal Task: Filter Operational Strategy and Flow Control (Pilot)
Description: This pilot work will look at operational techniques and strategies that can improve particle or TOC removal. It will also look at reducing and/or shortening filter ripening spikes through backwash optimization studies. This work can be carried out prior to the optimization of coagulation/flocculation/mixing approaches, but will need to be verified once these operational conditions are finalized.
Pre/Post Requisite: Coagulant studies should be completed or this work should be at least verified upon completion of those studies.
Schedule: On -going
16
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/Precursor Removal Task: Filter Operational Strategy and Flow Control (Consultant Facilitated)
Water
Description: This consultant facilitated work will draw on lessons learned through pilot work done to date. The consultant will look at results of previous pilot work for opportunities to pursue operational changes. A brainstorming session will be done with plant operators to identify opportunities for operations changes such as resting filters flow control etc. The work will also look at the possibility of deploying ETSW full scale.
Primary Resource: Consultant Team
Pre/Post Requisite: This work will also follow pilot work looking at chemical and mixing optimization of coagulation and flocculation processes.
Schedule: February June 2012
Budget: $50,000
17
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/ Precursor Removal and DBP Goals Task: Pre-chlorination Evaluation
Water
Description: If the JD Kline facility did not depend on pre-chlorination for microbial control in their filters, there is the potential that significant decreases in DBPs could be realized, as eliminating pre-chlorination is an effective way to control DBP levels in finished water. This tak will evaluate potential DBP reductions that can be achieved through eliminating pre-chlorination practices at this facility. As part of this investigation, the option of operating biologically active filters will also be examined for this facility, which may lead to further removal of biodegradable NOM, which are typically recalcitrant to coagulation treatment. If biologically filters are identified as posing too high of a threat to microbial contamination at this facility, chlorination could be add to filter backwash water to act as a filter aid for microbial control in the filters. This study will look at alternative location for pre-chlorination and the risks/benefits of not prechlorinating. The study must also consider the relationship between primary disinfection and the addition of potassium permanganate for oxidation of manganese.
Pre/Post Requisite: This work will follow pilot work looking at chemical alternative coagulants.
Schedule: June December 2013
18
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global Task: Advanced Pilot Studies
Description: Advanced pilot studies refers to the need to pilot performance improvement strategies that have a high capital cost such as DAF, membranes and UV. Since HRWC highly confident that particle removal goals can be achieved without constructing these process improvements, these pilot studies are not described in detail and would only be considered if the goals cannot be achieved through plant optimization.
Primary Resource: Research Team/Consultants
Pre/Post Requisite: Completion of all pilot work and studies scheduled for up to spring of 2010.
Schedule: March 2014 and beyond, only if required
Budget: N/A at this time
19
Lake Major Water Supply Plant
20
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Particle/ Precursor Removal Task: Coagulation and Upflow Clarification Assessment
Water
Description: This research task will optimize the coagulation and up-flow clarification processes at the Lake Major WSP. This study will identify optimal coagulant/coagulant aid dosage and pH conditions to maintain a desirable sludge blanket while optimizing organic matter and particle removal. In particular, research efforts will focus on optimizing performance during extreme weather operational challenges and will have secondary goals of reduced sludge management costs and improved wastewater quality. This research task will identify performance indicators to be used by the operators when adjusting pH and dosages in response to water quality changes, particularly extreme warm and cold weather periods that are historically operationally challenging.
Primary Resource: Research Team Water Quality Manager
Pre/Post Requisite: There are no pre-requisites.
Schedule:
February - March 2012: Warm Weather Trials August - October 2012: Cold Weather Trials
Budget:
21
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Waste Treatment Goals Task: Residuals Handling Optimization
Water
Description: This research task will optimize the sludge handling processes at the Lake Major WSP by identifying optimal polymer dosages to be added during both the sludge thickening treatment stage and for additional sludge drying prior to the centrifuge process. This research task will identify performance indicators to be used by the operators when adjusting these dosages in response to water quality changes and fluctuations.
Pre/Post Requisite: Lake Major Coagulation and Upflow Clarification Assessment task will be completed prior to this task commencing.
Schedule:
February June 2013
Budget:
22
Bennery Lake Water Supply Plant
23
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global - Treatment Water Quality Task: Process Optimization Study
Description: Complete a comprehensive review of the treatment processes at the Bennery Lake WSP and develop a comprehensive optimization strategy and recommendations to improve the operation of the facility. Process challenges to be directly addressed by this study are floc carryover due to poor settling performance, unbalanced hydraulics, undesirably short filter run times, consistent manganese removal to meet regulatory requirements, achieving HAA regulatory requirements, secondary turbidity spikes and quality issues associated with the daily start-up/ shut-down of the plant.
Primary Resource: Consulting Team
Pre/Post Requisite: There are no pre-requisites.
Schedule:
To be determined
Budget:
$80,000
24
Distribution System Water Quality
25
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Global - Distribution System Water Quality Task: Distribution System Water Quality and Integrity Monitoring
Water
Description: Halifax Water has set a goal to develop a comprehensive program to actively monitor and assess both distribution system water quality and physical integrity. This monitoring program would incorporate a suite of physical, hydraulic and water quality parameters at strategically identified sampling points to both identify and reduce the risk of contamination events or water quality issues and identify changes in the physical integrity of distribution system components. A key requirement of this program is to incorporate monitoring parameters that can be measured quickly, inexpensively and (ideally) continuously at multiple locations within the treatment system. Halifax Water is currently measuring and recording several parameters that can be incorporated into this program; however, the data is not always being used to its full potential as far as monitoring, understanding and predicting water quality in the distribution system.
Primary Resource: Engineering Dept Staff (Technician/engineer) Water Quality Inspector for field support Water Quality Manager
Schedule: Begin developing capability in January 2013
Budget: Ongoing cost of staff and software.
26
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: DBP Goals Task: Disinfection Efficiency and THM/HAA Removal Study
Description: The disinfection system residual and DBP monitoring initiated through the first phase of the WQMP has provided sufficient data to be used in supporting this research task. This work will focus on optimizing secondary disinfection to produce a strategy that looks at the most effective ways of achieving regulated chlorine residual levels and DBP goals. The strategy will look at distribution system strategies such as booster chlorination and reservoir operation and mixing as well as assess the need for point of use DBP treatment options, such as reservoir aeration or granular activated carbon (GAC) treatment. A particular focus of this task will be addressing the high THM levels associated with the North Preston rechlorination station.
Primary Resource: Engineering Dept Staff (Technician/engineer) Water Quality Inspector for field support Water Quality Manager
Schedule: Begin developing capability in September 2011.
27
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Distribution System Water Quality Goals Task: Adopt and Implement New Lead Policy
Water
Description: The new lead policy is composed of three umbrella programs, which have an overall goal of maintaining optimal corrosion performance in the distribution system and upholding a pro-active approach in protecting public health by reducing the health risks associated with exposure to lead in drinking water. The major programs that have been enhanced under this new policy are the Residential Sampling Program, Distribution System Monitoring Program and a Lead Service Line (LSL) Replacement program. The new program affects a number of departments within the commission and will take a significant commitment from all stakeholders to ensure it is rolled out in an effective and successful manner.
Primary Resource: Water Quality Inspectors Customer Service Supervisor Operations Superintendents Superintendent, Plant Operations Water Quality Manager
Schedule: May - October 2011
28
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Distribution System Water Quality Goals Task: Lead Service Line Replacement and Monitoring Program
Water
Description: Halifax Water is implementing an aggressive lead service line (LSL) replacement and monitoring program which includes new operations and monitoring protocols for planned, unexpected and pro-active LSL replacements. Two major components of these programs are (1) a public education program to encourage homeowners to replace the private portion of the LSL, to enhance awareness of the health risks associated with lead in drinking water and to outline protocols to follow to minimize lead exposure for a defined period of time following a LSL replacement and (2) an aggressive program to monitor the effects of LSL replacements by testing the water in the home for lead concentrations both before and after a lead pipe replacement.
Primary Resource: Water Quality Inspector Superintendent, Plant Operations Operations Superintendents Water Quality Manager
Schedule: May - October 2011
29
HRWC J.D. Kline Water Quality Master Plan Implementation Goal: Distribution System Water Quality Goals Task: Implement New Residential Lead Monitoring Program
Description: Halifax Waters current residential sampling program does include an adequate indication of the lead concentrations that are representative of residences with lead service lines. This new program will follow the two-tier protocol that is recommended in the Health Canada guidance document with minor modifications. This program will include the collection of both a 1st draw (1-L) and flushed water sample following 6 hours of stagnation. For Tier 1 sampling, lead levels will be monitored once per year at 100 homes of which at least 50% of the sites have lead service lines. If more than 10% of the sites sampled have lead levels above 0.015-mg/L, Tier 2 sampling will be conducted to provide more detailed information about the source of lead in that particular home and aid in identifying the best correction action measures to be implemented.
Primary Resource: Water Quality Inspector Superintendent, Plant Operations Water Quality Manager
Schedule: May 2011 December 2011
Budget: Ongoing cost of staff and software
30
January 9, 2013
Page 493
AppendixH
CCMEMunicipalWastewaterEffluent ImplementationPlan
thk Halifax 1 1 Water

January 9, 2013
Page 495
HalifaxWaterImplementationPlan CCMECanadawideStrategyfortheManagementof MunicipalWastewaterEffluent,and WastewaterSystemsEffluentRegulations(WSER)

UpdatedOctober2012 Introduction: TheCCMECanadawideStrategyfortheManagementofMunicipalWastewaterEffluentisnowineffect (asofFebruary,2009).ThereareanumberofelementsofthisStrategythatwillrequireactionby HalifaxWateroverthe30yeartimespandefinedintheStrategytoachievecompliance.These elementsarelistedbelow,togetherwiththeassociatedrequiredactions. Thisdocumentwillberevisedwhennewinformationbecomesavailable.ThisCCMEimplementation planisrelatedtotheHalifaxWaterCompliancePlanfortheWastewaterTreatmentfacilities(WWTFs), whichconsidersbothCCMEandNSEcompliancerequirements. PlanElements: NationalPerformanceStandard(NPS):AlltreatmentfacilityeffluentmustconformtotheNational PerformanceStandard(NPS)of25mg/LCBOD;25mg/LTSS;0.02mg/LTRC.(CBODCarbonaceous BiochemicalOxygenDemand,TSSTotalSuspendedSolids,TRCTotalResidualChlorine,forthose facilitiesusingchlorinedisinfection).Thisstandardwillrequireupgradingoffourwastewatertreatment facilitiestosecondarytreatmentlevels:EasternPassage,Halifax,DartmouthandHerringCove.The contractfortheEasternPassageExpansionandUpgradehasbeenawardedandconstructionisunder way.TheotherthreefacilitieswillneedtobeupgradedinaccordancewiththescheduleintheCCME Strategy.Theseupgradeswillrequireplanning,predesignanddesignwork,RFPprocessesand contracting.Therewillbesignificantcapitalcostswhichwillbeidentifiedasupgradeplansare developed,aswellasincreasedoperatingcostsfortheupgradedfacilities,andformanagementofthe additionalbiosolidsgenerated. ThefinalWastewaterSystemsEffluentRegulations(WSER)werereleasedinJune2012andarenowin force.Theseregulations,madeundertheFisheriesAct,implementthoseaspectsoftheCCMEStrategy whichfallunderfederaljurisdiction,namelythedischargeofdeleterioussubstancestofishhabitat.The WSERdefinesthesamenationaldischargestandardsforCBOD,TSSandTRCastheCCMEStrategy,but alsoimposesastandardof1.25mg/Lforunionizedammoniaandrequiresthateffluentnotbeacutely lethal. Inaddition,provincialjurisdictions(NovaScotiaEnvironmentinthisprovince)mayimposestricter requirementsonTSS/BOD/TRC,andonothersubstancesofconcern,throughsitespecificEffluent DischargeObjectives(EDO),andbasedontheresultsoftheEnvironmentalRiskAssessments(ERA, Page|1
discussedfurtherbelow).FacilitiesnowusingchlorinedisinfectionwillnotmeetthenationalTRC standard,andwillrequireeitherdechlorinationupgradesorconversiontoUVdisinfection. ThebiosolidsprocessinganddewateringfacilitiesatAerotechmayalsoneedupgradingand/or expandedoperationstohandletheincreasedloadofbiosolidsgeneratedwithincreasedtreatment levels. WWTFRiskAnalysis:Thefirststepintheplanningprocessistoconductariskanalysisforeachfacility basedoncriteriadefinedbyCCME,todeterminetherisklevelandassociatedtimeframeforcompliance (HighRisk10years,MediumRisk20years,LowRisk30years).Aninitialdraftofthisriskanalysishas beencompleted(ScheduleA).ResultsandimplicationsforeachoftheHalifaxWatertreatmentfacilities arediscussedbelow. HarbourSolutions(Halifax,Dartmouth,HerringCove)thesefacilitiesweredesignedasadvanced primaryfacilitieswithdischargeobjectivesforBOD/TSSof50/40mg/L,andsoarenotcompliantwith theNPS.Eachwillrequireanupgradetosecondarylevel.Thepreliminaryriskanalysisresultsindicate thatHalifaxandDartmoutharebothmediumrisk,andthusmustbecompliantwithin20years.The CCMEStrategyspecifiesthatsystemswithCSOdischargesmustalsoconsidertheriskinherentinthe CSOs,andifthatCSOriskscoreonasewershedbasisexceedstheriskscoreforthefacility,thenboth CSOsandfacilitymustbecompliantwithin30years.TheCSOriskanalysesforHalifaxandDartmouth havebeencompleted.TheresultsindicatethatCSOriskmayexceedtheplantriskfortheseplants, providing30yearstoaddressbothCSOmanagementandplantcompliance.HerringCoveisinthelow riskcategory,andsomustbecomecompliantwithin30years. AeroTechthisfacilityisnotCCMEcompliantduetohighBOD/TSS.Theriskcategoryismedium,andso thetimeframeforcomplianceis20years.Furtherstudyofoptionsforthisfacilityisrequired,since significantreceivingwaterlimitationsexist.AnERAhasbeeninitiated,whichwillbecompletedin2012. BelmontthissmallsubdivisionfacilityisnotCCMEcompliantduetoTRC.Thisfacilityisscheduledto bedecommissionedandconnectedtotheEasternPassagefacilityoncetheexpansionandupgradeof EasternPassageiscompleted.TheBelmontdecommissioningiscurrentlyscheduledtobecompletedin 2015. EasternPassagethisfacilityisnotCCMEcompliantbasedonBOD/TSS.Acontracttoexpandand upgradetosecondaryleveltreatmenthasbeenawardedbyHalifaxWater,whichwillbringthisfacility intoCCMEcompliance.Constructionisongoing. FramethissmallsubdivisionfacilityisnotCCMEcompliantduetoTRC.Theriskcategoryislow,with 30yearstocomply.However,theexistingdisinfectionsystemisnotfunctioningwell,soaconversionto UVdisinfectionisproposedfor2012/13. LakesideTimberleathisfacilityisnotCCMEcompliantduetohighTRC.Thisfacilityiscurrentlyatthe maximumcapacityallowedbyNSEnvironmentduetolimiteddilutionofthetreateddischargeinthe receivingwaters,andisthesubjectoffurtherstudytoexamineoptionsfordealingwithfuturegrowth. ReductionofTRCorreplacementofchlorinewithUVdisinfectionwillformpartoftheseoptions.This facilityisinthelowriskcategory,andsohas30yearstobecomecompliantunderCCME.An EnvironmentalRiskAssessment(ERA)asrequiredbyCCMEhasbeencompletedandsubmittedtoNSE. Page|2
HalifaxWaterhasdecidedtodivertsomeofthesewagefromtheLakesideTimberleasewershedinto theHalifaxsewershed,tofreeupcapacityfornewdevelopmentinLakesideTimberlea.Thisdiversion projectispending. LockviewMacPherson(FallRiver)ThisfacilityiscurrentlyCCMEcompliant.TheFallRivercommunity iscurrentlythesubjectofaplanningstudyforfuturegrowth.Thisstudywillconsideroptionsforfuture sewagetreatmenttoaccommodateprojectedgrowth,andisongoingthroughHRMCommunity Planning. MillCovethisfacilityiscurrentlyCCMEcompliant. MiddleMusquodoboitthisfacilityiscurrentlyCCMEcompliant. NorthPrestonthisfacilityiscurrentlyCCMEcompliant. SpringfieldLakethisfacilityisnotCCMEcompliantduetoTRC.Anupgradewillneedtobeplannedto dechlorinate,ortoconverttoUVdisinfection.Theriskcategoryislow,with30yearstocomply. Steeves(Wellington)thissmallsubdivisionfacilityisnotCCMEcompliantduetoTRC.Thisfacilityisin theprocessofbeingcompletelyreplaced.ConversiontoUVdisinfectionisincludedaspartofthis project.Theprojectisscheduledtobecompletedby2013. UplandsParkthissmallsubdivisionfacilityisnotCCMEcompliantduetoTRC.Anupgradeisplanned duringFY2010/11toconvertthisfacilitytoUVdisinfection.Theriskcategoryislow,with30yearsto comply. WastewaterCharacterization:TheCCMEStrategyrequiresthateffluentforalltreatmentfacilitiesbe screenedforabroadlistofparameters(dependantonplantsize)whichmayhaveimpactsonreceiving waters.Thismustbedoneforallfacilities,sinceprovincialjurisdictionsmaydecidetoimposestandards beyondthebasicnationalperformancestandards.Aoneyearwastewatercharacterizationmustbe completedforallfacilitiesaspartoftheEnvironmentalRiskAnalysisoutlinedbelow.Budgetwas providedduringFY2010/11andsubsequentyearsforlabanalyses.Samplingisconductedby RegulatoryCompliancestaff.Requiredmonitoringincludesbiologicaltoxicitytesting.Aninitialbudget estimatefortherequiredsamplingatallfacilitiesisapproximately$124,000forchemicalanalyses. Toxicitytestingcost(additional$67,000)hasbeenestimatedbasedonlimitedquotesfromtheonly NovaScotialabaccreditedforacutetoxicitytesting.Chronictoxicitytestingisnotcurrentlyavailable fromalocalsupplier,sosamplesaresenttoAquaToxinOntaro.Samplingwillbescheduledaspartof thetimetableforeachofthefacilityenvironmentalriskanalyses,detailedbelow.DetailedCCME StrategymonitoringrequirementsareprovidedinScheduleB.CharacterizationwascompletedforBLT in2010andforAeroTechin2011.CharacterizationsamplingisongoingforNorthPrestonand Springfield,andhasbeeninitiatedforHalifax,Dartmouth,HerringCoveandMillCove.Basic characterizationforallverysmallandsmall(CCMEcategories)plantswasinitiatedinNovember2010, andisnowcomplete. ReceivingWaterEnvironmentalRiskAnalysis(ERA):ReceivingwaterERAsmustbeconductedforall facilities,includingthoseincompliancewiththenationalperformancestandards,sincejurisdictionswill usetheseanalysestodetermineifadditionalstandardsmustbeimposedforeacheffluentdischarge. Page|3
TheERAwilldeterminetheenvironmentalconcentrationsofdischargedsubstancesoutsideofthe definedmixingzoneinthereceivingwaters.Jurisdictionswillusetheseresultstodetermineifany dischargedsubstancesexceedwaterqualityobjectivesandthereforerequireimpositionofeffluent dischargeobjectives(EDOs)inadditiontothenationalstandards.TheseERAstudieswillbecarriedout throughconsultingcontracts,whichwillrequirebudgetallocationsoverthenextseveralyears,andstaff timetoprepareRFPs,evaluate,awardandmanagecontracts. AnERAforEasternPassagewascompletedaspartoftheplanningforthecurrentupgradeproject, designedtobecompliantwiththeCCMErequirementsastheywerethenunderstoodindraftform,and hasbeenacceptedbyNSE.AstudywasinitiatedinFY2009/10fortheLakesideTimberlea(BLT)facility aspartofthelargerstudyofoptionsforfuturesewageloadsatthisfacility.TheBLTERAstudyisnow completeandhasbeensubmittedtoNSEnvironment.TheERAstudyforAeroTechWWTFwasinitiated in2010/11andwillbecompleteinlate2012.AnadditionalERAstudywasawardedin2010/11forthe FallRiver,FrameandWellingtonWWTFs,dueforcompletionin2012/13. WatershedMonitoring:Withinfiveyears,thefederal&provincialjurisdictionsmustdefine requirementsforsomedegreeofwatershedmonitoringforreceivingwatersystems.Suchmonitoring willbebudgetedandinitiatedoncetheprovincialrequirementsarefinalized. ReductionatSource(PollutionPrevention):TheStrategyincludesaModelSewerUseBylawfor considerationbymunicipalities.ThesewerrulesandregulationsofHalifaxWaterhavebeenupdatedto reflectanychangesrequiredtoachieveconformitywiththeintentoftheCCMEmodelbylaw. CombinedandSanitarySewerOverflows(CSOandSSO):TheStrategyrequiresthattherebeno increaseinCSOorSSOfrequencyexceptaspartofanapprovedmanagementplan(tobedefinedbythe province),thattherebenodryweatheroverflows,andthatCSOsbescreenedwherefeasible.Overflow eventsmustbereportedforfrequencyandvolume,withinthreeyears(by2012).Thiswillrequire physicalupgradesofmostCSO/SSOlocations(primarilypumpingstations)toenablerecordingofevent occurrencesanddurations,andtobeabletomeasureflowsortocalculateestimatedvolumes.SCADA systemupgradeswillalsoberequiredtoenablerecordingofdatathroughthePIsystem.Technical ServicesstaffcontinueworktoprovidetheneededSCADAupgrades,toenablereportingoftheSCADA datafromCSO/SSOlocations. Equipmentneedshavebeendefined.Sensorinstallationstomeasurewaterlevelsinthewetwellsin pumpingstationswereinitiatedin2010/11foraninitialsetof18pumpstationsthroughcontracted serviceswithCBCLandatendertoBlack&Macdonald.Wetwellwaterlevelwillallowdetectionof overflowconditions,andwillalsoallowcalculationofapproximateoverflowvolumes.Theinitialproject wasstartedduringFY2010/11,usingcapitalfunds($240,000)originallyallocatedforflowmeasurement andsamplingattheHalifaxCSOpoints,butavailableduetotheshutdownoftheHalifaxfacility.These fundswereusedtoprovideinstrumentationfortheselectedlistofpriorityCSO/SSOlocations.Further fundsforadditionallocationswillbeallocatedinfutureyears.ThePermanentFlowMonitoringbudget willbeusedtoupgradeCSOlocationequipmenttoallowestimationofoverflowvolumes,basedon knowledgegainedthroughaninitialtrialprojectontheGroveStreetCSOinDartmouth.Environment CanadahaveindicatedthatmodelingestimateswillbeacceptableforCSOvolumereporting,sonotall CSOswillrequirenewsensors.FourCSOlocationswillbeprovidedwithsensorstoverifyandcalibrate themodelresults. Page|4
CSO/SSOmanagementplanswillneedtobedevelopedonasewershedbasisunderdirectionfromthe Province(NSEnvironment).PlanswillincludeprovisionstoreduceCSOeventsovertime,whichwill requiresomedegreeofupgradingofcombinedsewagecollectionsystemswiththeobjectiveofreducing stormwaterinputsorincreasingcapacity.ReductionandeventualeliminationofSSOeventsovertime willrequireupgradestoalargenumberofpumpingstationsand/orcollectionsystemstoreduceinflow andinfiltration,increasecapacity,providestorage,orothermethodstoreduceeventsinfrequency and/orvolume.Therewillbesignificantassociatedcapitalcostswhichwillbeidentifiedastheplansare developed. ComplianceMonitoring:AllmonitoringrequiredforCCMEcompliance(regulareffluentmonitoring, wastewatercharacterizationandCSO/SSOmonitoring)willbecarriedoutbyEnvironmentalServices staffofHalifaxWater.Analyseswillbeconductedbyaccreditedoutsidelaboratories. Inflow&Infiltration(I&I)Reduction:Ongoingreductionofinflowandinfiltrationinthepublic collectionsystem,andI&Ireductionfromprivatesources,willreducethebaseandpeakflowswithin thewastewatercollectionsystems.Thebenefitwillbetoassistinreducingboththefrequencyand volumeofwastewateroverflowsatSSOlocationsduringrainfallevents,andreducehighflowimpacts ontreatmentplantperformance. FederalandProvincialImplementationoftheStrategy:ThefinalWastewaterSystemsEffluent Regulations(WSER)werereleasedinJune2012.Theseregulations,madeundertheFisheriesAct, implementthoseaspectsoftheCCMECanadawideStrategyfortheManagementofMunicipal WastewaterEffluentwhichfallunderfederaljurisdiction,namelythedischargeofdeleterious substancestofishhabitat.TheWSERdefinesthefollowingasdeleterioussubstances,andsetsnational standardsfortheirdischarge:CarbonaceousBiochemicalOxygenDemand(CBOD)25mg/L;Total SuspendedSolids(TSS)25mg/L;TotalResidualChlorine(TRCforthosefacilitiesusingchlorinefor disinfection)0.02mg/L;andUnionizedAmmonia1.25mg/LasNitrogen,at15C1C.Inaddition, effluentcannotbeacutelytoxic.Thefederalregulationsintroduceanewparameterinadditiontothe performancestandardssetbyCCMEforCBOD,TSSandchlorine.Thefederalregulationsincludea treatedeffluentdischargestandardforunionizedammoniaof1.25mg/L.Theunionizedformof ammoniaistheformwhichistoxictofish,andiscalculatedbasedonpH.Samplingconductedtodate forallHalifaxWaterWWTFsindicatesthatalltheplantsareabletomeetthisstandard. Theseregulationsclarifysomeoftherequirements,andwillinfluencefurtherdevelopmentofbusiness plansandbudgetsforCCMEcompliance.TheprovinceofNovaScotiahasindicatedthatitwill implementCCMErequirementsundertheirjurisdictionthroughconditionsattachedtoApprovalsissued byNSEnvironment. Thefederalregulationsalsorequireinitialidentificationreports,documentingvariousaspectsof wastewatertreatmentfacilitiesandanyoverflowpoints(CSOsandSSOs).Facilitiesnotimmediately compliantwiththedefinedstandardsmustapplyforinterimapprovalstodischargeforthetimeperiod duringwhichtheywillachievecompliance. HalifaxWaterhasraisedanumberofpracticalquestionswithNSEnvironmentregardingvariousdetails suchasCSO/SSOmanagementplans,conductandtimingofERAstudiesinrelationtofacilityupgrades, etc.NSEisconsideringthesematters,butthereareanumberofunansweredquestionsatthispoint. Onceresolved,thesemayaffectthedetailsofcomplianceplansoverthenextseveralyears. Page|5
CCMEStrategyTimelines: February2009:CCMEMinistersapprovetheStrategy. February2010:InitialWWTFRiskAnalysismustbecompletedtodeterminetimelineforcompliancefor thoseWWTFswhichdonotmeettheNPS(DONESeeScheduleAappended). 2012:AllfacilitiesmustmonitorforcompliancewiththeNPSparameters(DONE).Publicreporting, includingoverflowfrequencyandvolume,mustbeprovided. 2014:Jurisdictionsmustdeterminerequirementsforreceivingwatermonitoringatawatershedlevel. 2016:FacilitiesnotincompliancewithNPSwillsubmitactionplansincludingprioritizationofactions. 2016:NationalstandardsforCSOsandSSOsmustbemet,includingcompletionofapprovedlongterm managementplans. 2017:EnvironmentalRiskAssessmentswillbecompletedforallfacilities,andsitespecific EnvironmentalDischargeObjectiveswillbeestablishedbyjurisdictionswhereneeded.Aoneyearinitial wastewatercharacterizationwillbecompletedforeachWWTFaspartoftheERA. 2019:HighriskfacilitiesmustbecompliantwithNationalPerformanceStandards. 2029:Mediumriskfacilitiesmustbecompliant. 2039:Lowriskfacilitiesmustbecompliant;mediumandhighriskfacilitieswithCSOrisk>facilityrisk mustbecompliant. WSERTimelines: January1,2013:Monitoringofeffluentbegins. May15,2013:WWTFIdentificationReportsdue. 2013/14andsubsequentyears:Quarterly(>17,500m3/day)orAnnualMonitoringReportsdue. February15,2014andsubsequentyears:CSOReportsdue. June30,2014:ApplicationforTransitionalAuthorizationsdue. January1,2015:Toxicitytestingbegins. Within90daysofdetectingacutelethality:ApplicationforTemporaryAuthorizationtoDepositUn ionizedAmmoniadue. Page|6
CCMETASKLIST&RESPONSIBILITES FY2009/10(Complete) 1. SCADAconnectionstothePIsystem(ongoingintoFY2011/12and12/13). 2. Calculationofoverflowvolumesbasedonwaterleveldata.DesignworkbyCBCLincludesthese calculations. 3. Installationofwaterlevelsensors,priorityCSO/SSOlocations(initiatedFY2009/10,continuing FY2011/12and12/13). 4. ERAStudies.InitiateoneERAstudy(LakesideTimberlea). 5. InitialWastewaterCharacterizations.Initiate12monthsamplingforCCMEexpandedlistof wastewatereffluentparametersonepriorityWWTF(LakesideTimberlea). FY2010/11(Complete) 1. Installationofwaterlevelsensors,additionalCSO/SSOlocations(ongoingintoFY2011/12and 12/13). 2. HalifaxandDartmouthCSOflowmonitoringpreparePlans. 3. ERAStudies.InitiateadditionalERAstudies.(AeroTech) 4. InitialWastewaterCharacterizations.Initiate12monthsamplingforCCMEexpandedlistof wastewatereffluentparametersAeroTechandsmallplants 5. CompleteWWTFRiskAnalysisforsystemswithCSOs. FY2011/12(Complete) ContinueItem#s15asperFY2010/11planandbudget. 1. Installationofwaterlevelsensors,additionalCSO/SSOlocations. a. TenderingforequipmentinstallationandSCADAconnectionstoBlack&Macdonald. b. Staffteam,Engineering&ISleadTonyBlouin,GrahamMacDonald,PeterMaynard. 2. HalifaxandDartmouthCSOflowmonitoring a. InitialtestcaseatGroveStreetCSOtoprovemethodology. b. StaffteamEnvironmentalServices. 3. ERAStudies.InitiateadditionalERAstudies. a. ExternalconsultingcontractsunderoperatingbudgetallocationFallRiver,Frame& WellingtonstudyawardedtoDillon(ongoing12/13). b. WastewaterOperations,TonyBlouin. 4. HalifaxandDartmouthCSOsampling. a. InitialsamplingforHalifaxnegotiatedwithNSEreviewdataonceseveralpriority eventssampled. b. PollutionPreventionstaff,TonyBlouin. 5. InitialWastewaterCharacterizationssamplingforCCMEexpandedlistofwastewatereffluent parameters a. NorthPreston&Springfieldinitiated. b. Internalstaffresourcesforsamplecollection(RegulatoryCompliance),externallab analyses.TonyBlouin&Compliancestaff. Page|7
FY2012/13 1. CompleteSSOsensorinstallations. 2. CompleteFrameWellingtonFallRiverERA. 3. InitiateInitialWastewaterCharacterizationsforHalifax,Dartmouth,HerringCoveandMillCove. FY2013/14 1. SensorinstallationsforselectedCSOlocationsFerguson,SackvilleandNorth. 2. InitiateERAstudyforHalifax,Dartmouth,HerringCoveandMillCove. 3. SubmitIdentificationReportsforeachWWTF. 4. BeginWSERmonitoring. 5. CalibratecollectionsystemhydraulicmodelforCSOsandinitiategenerationofCSOvolume estimatesbasedonrainfalldata. 6. SubmitinitialCSOreportandMonitoringreports. FY2014/15 1. InitiateNorthPrestonSpringfieldERAstudy. 2. InitiateWSERtoxicitytesting. FY2015/16 1. InitiateMiddleMusquodoboitUplandsERAstudy. Subsequentyears Provincialrequirementsforreceivingwatermonitoringatawatershedlevelwillbedefined,andwill introduceadditionalsamplingandanalysistasks,forwhichappropriateoperatingbudgetallocationswill beprovided. LongTermTasks Atappropriatetimesoverthenext2030years(dependingontheoutcomeoftheWWTFRiskAnalysis ratingsforWWTFsandCSOs),significantcapitalplanswillneedtobecreatedforthefollowingitems: 1. UpgradetheHHSPWWTFstosecondaryleveltreatment 2. UpgradeanyotherWWTFswhichdonotmeettheNationalPerformanceStandardsthiswill includeupgradestoUVdisinfectionforanyfacilitiespresentlyusingchlorinedisinfection. 3. UpgradewastewatercollectionsystemstoeliminateSSOlocationdischargesaccordingtoan NSEapprovedSSOManagementPlan(tobedeveloped). 4. UpgradewastewatercollectionsystemstoreduceCSOlocationdischargesaccordingtoanNSE approvedCSOManagementPlan(tobedeveloped). Page|8
Schedule A.
10 20 Low Risk 30
Years to Comply:
High Risk
Medium Risk
WWTF Risk Assessment
January 9, 2013
Ammonia (mg/L) pH 7.2 No 13 No 0 None 5 38.0 6.9 No 0 Marine port None 10 65.2 0 Marine port None 10 63.0 No 0 Marine port None 10 61.0 19.3 Receiving Receiving Acutely Environment Environment Total Risk Lethal? Points Category Special Uses Points Points Category 80 50 67 50 40 18.0 N/A 0 34 20.2 N/A 0 40 18.0 N/A 0 50 26.0 1.81 10 Comments Not CCME compliant Medium upgrade in progress. Not CCME compliant Medium CBOD/TSS Not CCME compliant Medium CBOD/TSS Not CCME compliant Low CBOD/TSS 10 13 4.6 N/A 0 19.3 6.8 No 0 None 20 49.6
Facility Eastern Passage
Flow (m3/day)
Industrial Facility CBOD5 TSS Input? Size Points (mg/L) (mg/L) Points TRC Points
16,918
No
15
Halifax
122,000
No
35
Dartmouth Herring Cove
56,000
No
Medium Very Large Very Large
35
17,300
No
Medium
15
Mill Cove
28,000
No
Large
25
Low Low
CCME compliant.
LakesideTimberlea 9 12 4.2 0.24 10 3 6.7 No 0 None 20
4,154
No
Medium
15
49.2
Not CCME compliant TRC.
AeroTech
1,370
Yes
Medium
15
35
49
16.8
N/A
35.8
6.8
No
Open marine Enclosed bay, marine estuary River with bulk flow ratio > 10 - 99 River with bulk flow ratio < 10 None 25 56.8
Medium Not CCME compliant.

10 29.6
Belmont
181
No
Very Small 9 14 4.6 0.46 10 9.8 6.7 No 0 Marine port
Low
Not CCME compliant TRC - decommissioning planned.
80
No
Very Small 17 22 7.8 1.44 10 4.5 7 No 0
None Areas used for contact River with recreation bulk flow ratio within 500 m < 10 downstream
25
47.8
Low
None 20 28.0
Not CCME compliant TRC - upgrade planned.
195
No
Very Small 4 11 3.0 N/A 0 3 6 No 0
Low
None 20 27.8
CCME compliant.
Frame LockviewMacPherson Middle Musquodoboit 7 7 2.8 N/A 0 8 7.4 No 0
134
No
Very Small
Low
0 None 15 28.0
CCME compliant.
North Preston 4 11 3.0 N/A 0 3 6 No
616
No
Small
10
Low
No 0 None 20 42.8
CCME compliant.
518
No
Small
10
2.8
1.04
10
1.8
6.9
Low
6.6 No 0 None 15 35.4
Not CCME compliant TRC.
Springfield Lake Steeves (Wellingto n) 10 17 5.4 1.04 10 3.2
85
No
Very Small
Low
6.7 No 0 None 25 47.0
Not CCME compliant TRC - upgrade planned.
Uplands Park 20 15 7.0 0.94 10
148
No
Very Small
7.6
Lake, Reservoir River with bulk flow ratio > 10 - 99 River with bulk flow ratio > 100 River with bulk flow ratio > 10 - 99 River with bulk flow ratio > 100 River with bulk flow ratio < 10
Low
Not CCME compliant TRC - UV upgrade 2010.
Page 504
Page|9
ScheduleB.InitialWastewaterCharacterizationCCMERequirements
Parameter TRC 0 365 0 365 365 0 0 0 0 365 365 365 0 0 0 2190 96 676 28 56 0 26 4 4 4 56 0 260 4 12 12 0 260 4 12 12 12 0 0 0 0 12 0 0 0 0 $4,574 $4,574 $47,228 $47,228 $10,016 $191,296 $12,753 $10 $21,900 $7,392 $79,768 $15,036 $77 $118 $537 $600 $33,600 $600 $33,600 $191,296 Total Average 12 0 0 4 4 $9,374 12 0 0 0 0 $924 0 52 4 12 12 $22,684 12 0 0 0 0 $924 12 0 0 0 0 $924 0 26 4 4 4 $13,666 Medium VerySmall VerySmall Large VerySmall Small VerySmall VerySmall VeryLarge VeryLarge Medium 12 0 0 0 0 $4,574 VerySmall 0 26 4 4 4 $10,016 Medium 12 0 0 0 0 $4,574 VerySmall 0 26 4 4 4 $10,016 Medium 1/2 2/3 410 Acute Chronic Cost FacilitySize Notes Groups Toxicity
Wastewater TreatmentFacility (WWTF)
January 9, 2013
AeroTech
Belmont
IndustrialinputDONE Exempt decommissioning DONE Inprogress DONE Inprogress Inprogress Pending Inprogress Inprogress Inprogress Inprogress Pending Pending Pending
EasternPassage
FrameSubdivision
Lakeside/Timberlea
Lockview/Macpherson
MiddleMusquodoboit
MillCove
NorthPreston
SpringfieldLake
Steeves(Wellington)
UplandsPark
DartmouthHHSP
HalifaxHHSP
HerringCoveHHSP
No.
Unit Price Total Cost
NOTES:Toxicitycostsareapproximate,basedonlimitedavailablequotes.ChemistrycostsforCCMEparametergroupsarebasedonMaxxamLabsquotes. Parametergrouplistsattached.TRC=TotalResidualChlorine.
Page 505
Page|10
ParameterGroupDetails
Group 4 - Metals Metals (Al, Ba, Be, B, Cd, Cr, Co, Cu, Fe, Pb, Mn, Mo, Ni, Ag, Sr, Tl, Sn, Ti, U, V, Zn, As, Sb, Se) Mercury Group 5 - Organochlorine Pesticides PCBs + OC Pesticides Group 6 - Polycyclic Aromatic Hydrocarbons PAHs E.coli Group 7 - Volatile Organic Compounds VOCs
Group 1 - General Chemistry/Nutrients Total Suspended Solids
January 9, 2013
Carbonaceous BOD Total Residual Chlorine Ammonia Total Kjeldahl Nitrogen Total Phosphorous pH
Group 2 Pathogens
Group 3 - General Chemistry/Nutrients Group 8 - Phenolic Compounds Chlorophenols Group 9 - Surfactants Anionic Surfactants Non-Ionic Surfactants
Fluoride Nitrate Nitrate + Nitrite Ammonia Total Kjeldahl Nitrogen Total Phosphorous Total Suspended Solids Carbonaceous BOD Total Residual Chlorine Chemical Oxygen Demand Total Cyanide
Page 506
Page|11
January 9, 2013
Page 507
AppendixI
WastewaterTreatmentFacilities(WWTF) CompliancePlan
tkk Halifax Water

January 9, 2013
Page 509
Halifax Water
Wastewater Treatment Facilities (WWTF) Compliance Plan

October 2012 Q3 UPDATE
, Halifax tRL 1 i Water

1
Compliance issues identified for 2011 up to the end of Q3 2012. AeroTech 2011/12 Compliance Issues NSE: TSS, Ammonia CCME: TSS, CBOD
Compliance performance for TSS and ammonia continues to be problematic. Steps have been taken to reduce the ammonia loading on the AeroTech WWTF: diversion of sludge from Mill Cove WWTF, diversion of sludge from Eastern Passage to Dartmouth, maintenance of septage loading to the maximum of 2011 levels for each hauler, and discontinuing acceptance of biowater at AeroTech. In the long term, the Eastern Passage upgrade will include dewatering, so that EP sludge will no longer go to AeroTech. In addition, a third sand filter has been installed at Aerotech WWTF to improve TSS performance. Halifax Water continues to seek other means to reduce ammonia loading, possibly including additional sludge diversions. The ongoing ERA study will determine the feasible options for an AeroTech WWTF upgrade and/or expansion, including consideration of alternate discharge locations. Better management of wet-weather flows is also key to improving performance of this SBR facility. The lagoon is now being used to store wet-weather peak volumes, and improvements are being made to better manage discharge of water from the lagoon to the WWTF. These measures are consistent with the actions proposed in the 2011 Compliance Plan.
Belmont 2011/12 Compliance Issues NSE: CBOD, FC, TSS CCME: (Decommissioning)
The Belmont WWTF had shown improvements in performance for fecal coliform and TSS. CBOD has also improved but continues to be non-compliant for Q1 2012. The Belmont WWTF is still scheduled to be de-commissioned, with diversion of flows to the Eastern Passage WWTF by 2015, consistent with the 2011 Compliance Plan.
Dartmouth 2011/12 Compliance Issues NSE: FC, CBOD (2012) CCME: TSS, CBOD
The Dartmouth WWTF has lately been compliant with NSE limits for TSS, while CBOD compliance has fallen recently (Q2, Q3 2012). Fecal coliform was non-compliant for Q1/Q2 2012. However, corrosion in the sensors controlling the UV disinfection system was recently discovered and corrected. Fecal coliform performance has subsequently improved and may become compliant in the near term. As a relatively new facility, defect correction and operational adjustments continue to be made, consistent with the 2011 Compliance Plan. A secondary upgrade is required for CCME compliance.
2
Eastern Passage 2011/12 Compliance Issues NSE: CBOD, FC, TSS (2012) CCME: TSS, CBOD
The Eastern Passage WWTF is currently undergoing a significant secondary upgrade and capacity expansion, consistent with the 2011 Compliance Plan. TSS performance has degraded over the past year (since Q2 2011) and is now non-compliant. Fecal coliform has improved as predicted in 2011, and has been compliant for Q4 2011 and Q1 2012. CBOD continues to be non-compliant. The ongoing secondary upgrade will achieve CCME compliance.
Frame 2011/12 Compliance Issues NSE: FC, TSS, CBOD CCME: Chlorine
During Q3-Q4 2011 and Q1 2012, TSS performance has degraded at Frame WWTF. CBOD performance has also degraded during Q4 2011 and Q1 2012 this may require investigation. However, fecal coliform performance was significantly improved for Q1 and Q3 2012. CBOD improved for Q3 2012. Installation of a new collection system has been completed. The planned replacement of the WWTF and conversion to UV has been deferred. A number of smaller improvements are planned, and the outfall will still be relocated from the stream to the lake.
Halifax 2011/12 Compliance Issues NSE: CBOD CCME: TSS, CBOD
CBOD continues to be non-compliant, although it was compliant for Q4 2011 only. Soluble BOD continues to be an issue, although the largest single source is on track to be compliant with discharge Rules & Regulations in the near future. This should improve CBOD (total) performance overall. As a relatively new facility, defect correction and operational adjustments continue to be made, consistent with the 2011 Compliance Plan. A secondary upgrade is required for CCME compliance.
Herring Cove 2011/12 Compliance Issues NSE: None CCME: TSS, CBOD
The Herring Cove WWTF continues to be compliant with all NSE requirements. The transfer of sludge from the Mill Cove WWTF has not impacted performance, consistent with the 2011 Compliance Plan. A secondary upgrade is required for CCME compliance.
3
Lakeside-Timberlea 2011/12 Compliance Issues NSE: TSS, Ammonia CCME: Chlorine
Performance for ammonia had been compliant for Q4 2011 only, but has reverted to non-compliant for Q1 2012. TSS continues to be non-compliant. CBOD, FC, DO and TP continue to be compliant. An upgrade to UV disinfection will be required for CCME compliance. The Lakeside-Timberlea WWTF was the subject of a recent ERA study, which determined that the WWTF could be upgraded and expanded, with a sufficient level of treatment, without adding to loading of the Nine-Mile River. NSE has accepted this risk-based approach. A plan is in progress to divert approximately 34% of the sewage volume in this sewershed to the Halifax sewershed to reduce loading on the lakeside-Timberlea facility. Halifax Water continues to develop options to improve the LakesideTimberlea facility and achieve NSE compliance.
Lockview-MacPherson 2011/12 Compliance Issues NSE: CBOD, TSS (both improved 2012) CCME: None
Performance for CBOD has improved since Q2 2011. As a result of optimization of treatment processes, performance for TSS improved in 2012, and is now compliant.
Middle Musquodoboit 2011/12 Compliance Issues NSE: None CCME: None
Although compliant with NSE requirements through 2011, performance for TSS has been variable. TSS was below NSE limits for Q2 2011, and again in 2012.
Mill Cove 2011/12 Compliance Issues NSE: None CCME: None
Although performance at the Mill Cove WWTF was good throughout 2010 and 2011, results for TSS and fecal coliform had become non-compliant by Q1 2012, and CBOD performance had slipped from 100% compliant to approximately 85% compliant. Wastewater Operations staff consider that this has been due to the very high-strength compost leachate which had been accepted at Mill Cove WWTF. As a result of deteriorating performance, Halifax Water has advised HRM that compost leachate will no longer be accepted at Mill Cove as of June 25, 2012. Performance has continued to improve since Q2 2012.
4
North Preston 2011/12 Compliance Issues NSE: pH CCME: None
pH control continues to be difficult at North Preston WWTF, although performance has improved slightly since Q1 2012 to about 75% compliant.
Springfield Lake 2011/12 Compliance Issues NSE: CBOD, FC, TSS CCME: Chlorine
Although non-compliant though most of 2011, performance at the Springfield WTWF has consistently improved since Q2 2011. This is due to the correction of a blockage discovered in one of the treatment channels in the WWTF. High wet-weather flows have been an issue in this sewershed, as identified in the 2011 Compliance Plan. Recent improvements to pump stations and force mains have resulted in improved wet-weather performance, and fewer overflow situations even with extreme rains in fall of 72012.
Uplands Park 2011/12 Compliance Issues NSE: None CCME: None
Performance of the Uplands WWTF has continued to be good. Occasional non-compliance for TSS has been noted.
Wellington 2011/12 Compliance Issues NSE: FC, TSS CCME: Chlorine
The replacement for the Wellington WWTF is currently under construction, consistent with the 2011 Compliance Plan. Performance continues to be poor for TSS. Fecal coliform has been compliant since Q2, 2011. Performance for CBOD had fallen just below NSE requirements for Q1 2012 but has improved in Q2 and Q3. The new WWTF is online as of October 2012.
5
APPENDIX 5
GrantThornton
Please sign and return to GRANT THORNTON UP FOR THEIR FILES
Financial Statements (NSUARB Accounting and Reporting Handbook) Halifax Regional Water Commission March 31, 2012
January 9, 2013
Page 515
Contents
Page Independent auditor's report Statement of operations Balance sheet Statement of cash flows Statement of contributed capital surplus Statement of operating surplus Statement of operating surplus used to fund capital Notes to the financial statements Schedules A Schedule of utility plant in service B Schedule of long term debt C Schedule of operations for water service D Schedule of operations for wastewater/stormwater services E Airport aerotech system Schedule of operations for water service Schedule of operations for wastewater service F Regulated and unregulated activities Schedule of operations for regulated activities Schedule of operations for unregulated activities 1 2 3 4 5 5 5 6-14 15 16 17 18 19 20 21 22
January 9, 2013
Page 516
0 Gra ntThornton
Independent auditor's report
To the Members of the Board of the Halifax Regional Water Commission
Grant Thornton LIP Suite 1100 2000 Barrington Street Halifax, NS 63J 3K1 T (902) 421-1734 F (902) 420.1068 wym.Clan(Thomloaca
We have audited the accompanying financial statements of Halifax Regional Water Commission, which comprise the balance sheet as at March 31, 2012, and the statements of operations, contributed capital surplus, operating surplus, operating surplus used to fund capital and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. The financial statements have been prepared by management based on the financial reporting provisions of the Accounting and Reporting Handbook for Water Utilities ("the Water Utility Handbook") issued by the Nova Scotia Utility and Review Board. Management's responsibility for the financial statements Management is responsible for the preparation of these financial statements in accordance with the financial reporting provisions of the Water Utility Handbook, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropnateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements of Halifax Regional Water Commission for the year ended March 31, 2012 are prepared, in all material respects, in accordance with the financial reporting provisions of the Water Utility Handbook. Basis of Accounting Without modifying our opinion, we draw attention to note 2(a) to the financial statements, which describes the basis of accounting. The financial statements are prepared to assist the Halifax Regional Water Commission to comply with the financial reporting provisions of the Water Utility Handbook referred to above. As a result, the financial statements may not be suitable for another purpose. Other matters Our audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The current year's supplementary information included on pages 15 to 22 is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such supplementary information has been subjected to the auditing procedures applied, only to the extent necessary to express an opinion, in that audit of the financial statements taken as a whole.
Halifax, Canada June 21, 2012
Chartered Accountants
January 9, 2013
Audit Tax Advisory Gran' Thornton LLP. A Canadan Matrbw of Gs ant Thombn In lorngonal Lid
Page 517
Halifax Regional Water Commission Statement of operations

Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues Water service Wastewater/stormwater services Fire protection Private fire protection services Airport Aerotech system Other operating revenue $ 30,393 53,760 9,502 369 1,361 2,455 97,840 $ Actual 2011 Actual
30,562 54,383 9,502 366 1,352 2,662 98,827
30,719 45,532 9,502 362 1,323 2,242 89,680
Operating expenditures Water supply and treatment Water transmission and distribution Wastewater/stormwater collection Wastewater treatment Engineering and information services Environmental services Customer service Administration and pension Airport Aerotech system Depreciation
6,800 8,768 15,307 18,289 6,175 2,427 3,551 6,593 1,594 12,082 81,586 16,254
6,598 7,834 15,008 16,380 5,813 2,290 3,330 7,121 1,520 11,347 77,241 21,586
6,286 7,928 13,562 17,139 5,589 2,114 3,329 6,536 1,484 8,865 72,832 16,848
Operating profit Financial and other revenues Interest Other
480 2,194 2,674 18,928
402 2,193 2,595 24,181
545 2,279 2,824 19,672
Financial and other expenditures Interest on long term debt Repayment of long term debt Amortization of debt discount Grant in lieu of taxes (note 9)
8,114 13,145 58 3,882 25,199 $ (6,271) $
8,100 13,066 64 3,944 25,174 (993) $
8,896 13,158 70 3,749 25,873 (6,201)
Excess of expenditures over revenues
See accompanying notes to the financial statements.
January 9, 2013
Page 518
Halifax Regional Water Commission Balance sheet

March 31 (in thousands) Assets Current Cash and cash equivalents Receivables Customer charges and contractual Halifax Regional Municipality Materials and supplies Prepaids 2012 2011
16,403 20,563 1,385 1,154 709 40,214 163 4,156 23,951 900,385 968,869
15,730 21,655 20,398 1,143 653 59,579 176 2,078 13,527 893,633 968,993
Receivable from Halifax Regional Municipality Regulatory asset (note 5) Plant under construction Utility plant in service (schedule A) $
Liabilities Current Payables and accruals Trade Halifax Regional Municipality Interest on long term debt Contractor and customer deposits Current portion of long term debt (schedule B) Unearned revenue
15,484 1,235 1,421 177 13,109 119 31,545 133,063 4,309 741 2,780 172.438
13,903 7,946 1,548 150 13,272 121 36,940 146,118 3,945 803 2,600 190,406
Long term debt (schedule B) Accrued pension liability (note 4) Accrued post retirement benefits (note 4) Accrued long term service awards (note 6)
Equity Special purpose reserves (note 8) Contributed capital surplus (page 5) Operating surplus (page 5) Operating surplus used to fund capital (page 5) $
19,627 761,180 3,244 12,380 796,431 968,869
17,973 743,911 8,043 8,660 778,587 968,993
Contingent liabilities (note 3) Commitment (note 9) Subsequent event (note 15) On behalf of the Board
Iff-dre-_----
, Commissioner
b4.eommissioner
January 9, 2013
Page 519
Halifax Regional Water Commission Statement of cash flows

Year ended March 31 (in thousands) Increase (decrease) in cash and cash equivalents
Operating 2012
2011
Excess of expenditures over revenues Refund of Airport Aerotech stormwater revenue Depreciation and amortization Accrued pension liability Decrease in accrued post retirement benefits Repayment of long term debt Increase in accrued long term service costs Change in non-cash operating working capital items (note 10)
Financing
(993) (86) 12,270 364 (62) 13,066 180 24,739 2,505 27,244
(6,201)
-
9,727 1,360 (69) 13,158 153 18,128 1,994 20,122 5,150 (1,101) 3,836 (32) (6,500) (8,461) (7,108)
Proceeds from issuance of long term debt Decrease (increase) in receivable from/payable to Halifax Regional Municipality Contributions to reserves Debt issue costs Principal repayment on Harbour Solutions long term debt Principal repayments of long term debt
12,315 3,158 (54) (6,500) (6.772) 2,147
Investing
Capital cost contributions Proceeds from sale of plant in service Purchase of capital work in progress Purchase of plant in service
1,492 71 (14,199) (16,082) (28,718) 673 15,730
2,662 1,702 (5,282) (19,202) (20,120) (7,106) 22,836

$
Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year $
16,403
15,730
January 9, 2013
Page 520
Halifax Regional Water Commission Statement of contributed capital surplus

Year ended March 31 (in thousands) Contributed capital surplus, beginning of year Contributions to plant in service Transfer from special purpose reserve (note 8) Debt repayment (Loss) gain on sale of land Capital surplus transferred to Halifax Regional Municipality Capital surplus transferred with Halifax Harbour Solutions $
2012
2011
743,911 15,203 1,504 13,066 (37)
525,916 40,573 6,220 13,158 1,600 (4,600)
(52) 773,595 12,415 761,180 $
167,241
750,108 6,197 743,911
Less: amortization (note 2(b)) Contributed capital surplus, end of year
Halifax Regional Water Commission Statement of operating surplus

Year ended March 31 (in thousands) Operating surplus, beginning of year Operating surplus used to fund capital Excess of expenditures over revenues Refund of Airport Aerotech stormwater revenue Stewardship contributions charged to current surplus Operating surplus, end of year
2012
2011
8,043 (3,720) (993) (86)
14,681
(6,201) (437)
3,244
8,043
Halifax Regional Water Commission Statement of operating surplus used to fund capital
Year ended March 31 (in thousands) Operating surplus used to fund capital, beginning of year Additions to utility plant in service funded by operating surplus Operating surplus used to fund capital, end of year
2012
2011
8,660 3,720 $ 12,380
8,660
8,660

Halifax Regional Water Commission Notes to the financial statements

March 31, 2012 (in thousands) 1. Nature of operations
The Commission is a public utility owned by the Halifax Regional Municipality (FIRM). The Commission is responsible for the supply of municipal water, wastewater and stormwater services to the residents of the HRM.
2. (a)
Summary of significant accounting policies Regulation
In matters of administrative policy relating to rates, capital expenditures, depreciation rates and accounting matters, the Commission is subject to the jurisdiction of the Nova Scotia Utility and Review Board (NSUARB). Rates charged to and collected from customers are designed to recover costs of providing the regulated services. These statements have been prepared in accordance with the Accounting and Reporting Handbook for Water Utilities (Handbook) issued by the NSUARB. There are differences in the accounting treatment of certain transactions from Canadian generally accepted accounting principles in the areas of principal debt payments and gains and losses on the disposal of fixed assets. Regulatory assets represent costs incurred that have been deferred as approved by the NSUARB and will be recovered through future rates collected from customers. (b) Utility plant
Utility plant in service (Schedule A) is recorded at cost, including interest capitalized on the financing of projects during construction. Contributions for capital expenditures are credited to contributed capital surplus. Structures and land taken out of service are removed from utility plant in service and placed in plant not in service at cost less accumulated depreciation. Losses or gains related to assets retired, demolished or sold are charged or credited to contributed capital surplus for the period. The Handbook permits the recording of contributed assets. The estimated value of contributed assets is credited to contributed capital surplus. Commencing in fiscal 2005, contributed assets are depreciated over their estimated remaining useful lives. The related contributed capital surplus is being amortized on the same basis as the contributed assets to which it relates. The Commission has implemented a policy to account for infrastructure extensions into its water and wastewater/stormwater service districts, which for the most part will be recovered by capital contributions from developers in current and future periods. The objective is for these extensions to be cost neutral to the Commission with regard to current customers, unless there is a benefit to them. The related infrastructure extensions may include costs incurred by the Commission to provide additional capacity, not required at the present time, but undertaken to allow for future expansion. The estimated portion of these costs that do not benefit existing customers are recorded as contributed assets. The capital cost contribution is credited to contributed capital surplus when receivable and estimates adjusted, if required, when the development into the water service area is complete. The capital cost contributions are subject to approval by the NSUARB.
January 9, 2013
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March 31, 2012 (in thousands) 2. (c) Summary of significant accounting policies (continued) Cash and cash equivalents
Cash and cash equivalents consist of cash on hand and balances with banks, net of bank indebtedness. (d) Depreciation
Depreciation is provided using the straight-line method over the estimated useful lives of the assets, The estimated useful lives for the major classifications of utility plant in service are as follows: Structures and improvements Pumping equipment Purification equipment Water and wastewateristormwater mains Services Meters Hydrants Tools and work equipment Office equipment and furniture and transportation equipment (e) Depreciation fund 50 to 100 years 5 to 30 years 20 to 50 years 60 to 100 years 50 to 60 years 20 to 25 years 50 to 80 years 5 to 30 years 3 to 10 years
The Commission does not maintain a depreciation fund. The Commission has received NSUARB approval for exemption from setting up a depreciation fund as long as net depreciable additions to plant exceed the depreciation charged. (f) Materials and supplies
Materials and supplies inventories are carried at the lower of cost and net realizable value with cost being determined on a moving average cost basis. The cost of materials and supplies recognized as an expense during the period was $277 (2011 - $286). (g) Revenues and expenditures
All revenues and expenditures are recorded on an accrual basis with the exception of repayment of long term debt. Receivables include outstanding revenue billed by the Commission and estimated metered revenue not yet billed. (h) Long term debt
Interest on long term debt is recorded on an accrual basis. Debt issue costs are deferred and amortized over the term of the debt to which it relates.
January 9, 2013
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March 31, 2012 (in thousands) 2. (i) Summary of significant accounting policies (continued) Reserves
Certain funds within the reserves can be used for capital expenditures only with the approval of the NSUARB. All reserve withdrawals in excess of $250,000 require approval from the NSUARB. System connection charges approved by the NSUARB are added to these reserves as collected. The reserves are to be used for capital expenditures on the wastewater/stormwater system (note 8). (j) Measurement uncertainty
In preparing the Commission's financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenditures during the period, Significant estimates and assumptions are not limited to but include the following: Specifically, at year end, revenue from water and wastewater services have been earned but not yet billed due to the timing of the billing cycles. Management estimates the unbilled revenue accrual based on historic billing trends. Management assumptions are also used in the actuarial determination of the accrued pension liability, accrued post retirement benefit, and accrued long term service awards. These assumptions are outlined in notes 4 and 6 of the financial statements.
Actual results could differ from these estimates. (k) Financial instruments
The Commission is required to initially recognize and measure its financial assets and liabilities at fair value. Loans and receivables, held to maturity financial assets and other financial liabilities are subsequently measured at cost or amortized cost. The Commission classifies financial assets and liabilities according to their characteristics and management's choices and intentions related thereto for the purposes of ongoing measurements. Classification choices for financial assets include: a) held for trading measured at fair value with changes in fair value recorded in net earnings; b) held to maturity recorded at amortized cost with gains and losses recognized in net earnings in the period that the asset is derecognized or impaired; c) available for sale - measured at fair value with changes in fair value recognized in other comprehensive income for the current period until realized through disposal or impairment; and d) loans and receivables - recorded at amortized cost with gains and losses recognized in net earnings in the period that the asset is no longer recognized or impaired. Classification choices for financial liabilities include: a) held for trading measured at fair value with changes in fair value recorded in net earnings and b) other - measured at amortized cost with gains and losses recognized in net earnings in the period that the liability is no longer recognized. Any financial asset or liability can be classified as held for trading as long as its fair value is reliably determinable.
January 9, 2013
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March 31, 2012 (in thousands) 2. Summary of significant accounting policies (continued)
(k) Financial instruments (continued) The Commission's financial assets and liabilities are classified and measured as follows: Asset/Liability Cash Cash equivalents Receivables Receivable from HRM Payables and accruals Long term debt Classification Held for trading Held for trading Loans and receivables Loans and receivables Other liabilities Other liabilities Measurement Fair value Fair value Amortized cost Amortized cost Amortized cost Amortized cost
Unless otherwise noted, it is management's opinion that the Commission is not exposed to significant interest, currency or credit risks arising from financial instruments. The fair value of the Commission's financial instruments approximates their carrying values.
3.
Contingent liabilities
As a condition of the sale of a property, the Commission indemnified the purchaser from claims or actions resulting from migration of halocarbons. The environmental risk is assessed to be low and the likelihood of any related liability is not determinable. The Commission has been named along with the contractor for a flooding incident that occurred as a result of an overflow of wastewater at a pumping station associated with the Halifax Harbour Solutions (1-IHS) project. The claim is being defended by the Commission's insurer and the Commission believes its exposure in this regard is minimal. The Commission has certain outstanding grievances for alleged violations of the collective agreements with its unions. The financial risk of these grievances is not considered material.
4.
Pension plan and post retirement benefits
The Commission maintains a contributory defined benefit pension plan for all employees and offers post retirement health and insurance benefits to its employees. The pension plan provides pensions based upon length of service and best five years' earnings. The Commission follows the recommendations of Section 3461 "Employee Future Benefits" of the C1CA Handbook. This defined pension plan is funded by employer and employee contributions. Prior to July 1, 2011, the employer and employee were each contributing 9.5% of regular earnings. As of July 1, 2011, the amount increased to 10.47%. The Commission is responsible for funding the employer share of the contributions to the HRM pension plan for certain employees that transferred from HRM as of August 1, 2007. During the year, the Commission funded $637 (2011 - $670) in contributions to the HRM plan.
January 9, 2013
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March 31, 2012 (in thousands) 4. Pension plan and post retirement benefits (continued)
Employees who retired prior to July 1, 1998 have extended health benefits coverage for life and drug coverage until age 65. Employees who retired after July 1, 1998 and before December 31, 2008 have coverage for drug, extended health, dental and life insurance until age 65 on a 50/50 cost shared basis. Extended health coverage for these retirees and their spouses after the age of 65 is available on an optional basis at 100% retiree cost. Information about the Commission's plans, based on an actuarial extrapolation as at March 31, 2012, is as follows: 2012 2012 2011 2011 Post Post Retirement Retirement Benefits Benefits Pension Plan Pension Plan Accrued benefit obligation Balance, beginning of year Current service cost Interest cost Actuarial loss Benefit payments Transfers in Actuarial gain Balance, end of year Fair value of plan assets Balance, beginning of year Actual return on plan assets Transfers in Benefit payments Contributions: Employee Employer Balance, end of year Plan deficit Unamortized transitional asset Unamortized experience (loss) gain Unamortized plan amendments Accrued benefit liability Accrued benefit liability, beginning of year Expense Employer contributions Accrued benefit liability recognized $ 80,058 $ 4,096 4,347 14,897 (3,217) 11 100,192 55,443 2,689 11 (3,217) 1,692 3,583 60,201 39,991 982 (35,932) (732) 4,309 $ 3,945 $ 3,947 (3583) 4,309 $ 70,716 $ 3,825 4,065 4,069 (2,655) 38 80.058 50,105 4,273 38 (2,655) 1,516 2,166 55,443 24,615 1,179 (21,021) (828) 3,945 $ 2,585 $ 3,526 (2,166) 3,945 $ 726 15 741 $ 803 $ 14 (76) 741 $ 578 225 803 872 16 (85) 803 578 $ 24 (76) 200 726 629 27 (85) 7 578
$ $
Administration and pension expense includes pension expense of $3,947 (2011 - $3,526). Included in the 2012 pension expense is a special payment of $1,793 (2011 - $580). This amount includes the amortization of experience gains and losses and plan improvements. Amortization is calculated on a straight-line basis over the estimated average remaining service life of the employee group, currently estimated at 19 years. 10
January 9, 2013
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March 31, 2012 (in thousands) 4. Pension plan and post retirement benefits (continued)
The following assumptions have been used in the actuarial extrapolation of the accrued benefit liability at March 31, 2012: Post Post Pension Retirement Retirement Pension Benefits Benefits Plan Plan 2012 2011 2011 2012 Discount rate Expected return on plan assets Rate of compensation increase Expenses for life benefits as a % of claims Health benefit inflation per year Dental benefit inflation per year 4.50% 6.00% 3.75% N/A N/A N/A 5.40% 6.00% 3.75% N/A N/A N/A 4.50% N/A N/A 5-10% 5-10% 5% 4.50% N/A N/A 5-10% 5-10% 5%
Funding for the pension plan is based on regular actuarial reviews. There was an actuarial valuation completed January 1, 2011 and the next review is scheduled for no later than January 1, 2014. 5. Regulatory asset
In June 2011, the NSUARB granted the Commission approval to defer depreciation charges on certain assets transferred in 2010 from HRM relating to the Halifax Harbour Solutions Project. As a result, the Commission has recognized a $4,156 (2011 - $2,078) regulatory asset. In May 2012, the NSUARB granted approval of the amortization of this asset over the remaining useful lives of the underlying assets, beginning in 2013-14. In absence of rate regulation, the Commission would have otherwise recorded $2,078 (2011 - $2,078) of additional depreciation in the determination of excess of expenditures over revenues for 2011-12 on the statement of operations. 6. Accrued long term service awards
The Commission has a non-funded long term service award that is accrued annually, but is payable on retirement, termination or death if the employee has at least 10 years of continuous service. The benefit is equal to three days' pay for each completed year of service, up to a maximum of six month's salary. 2011 2012 Accrued long term service awards 2,780 $ 2,600
The following assumptions have been used in the valuation of the Commission's accrued long term service awards at March 31, 2012: Pre-retirement benefits Discount rate Rate of compensation increase 2012 4.50% 3.75% 2011 5.40% 3.75%
January 9, 2013
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11

March 31, 2012 (in thousands)
7.
Return on rate base
2012 2.87% 2.62% (3.88)% (74.07)%
2011 3.40% 1.16% (7.46)% (55.79)%
Rate of return on rate base for water service Rate of return on rate base for wastewater/stormwater services Rate of return on rate base for Airport Aerotech water service Rate of return on rate base for Airport Aerotech wastewater service
8.
Special purpose reserves

Sewer Other Capital Redevelopment Reserve Reserves Wastewater infrastructure Reserve $ 9,711 Wastewater & Stormwater Reserve $ 5,017 1,315 (51) $ 397 $ 4,112 $ 1,843 (227) 11,327 $ (1226) 3,791 $ $
2012
Total
2011 Total
Reserve, beginning of year Additions Contributions and interest Expenditures Reserve, end of year
397
2,848
17,973
20,357 207
3,158 (1.504) 19,627 $
3,629 (6,220)
17,973
9.
Commitment
An agreement with HRM for renewal of the dividend/grant in lieu of taxes for fiscal years 2011 to 2015 for water services was approved by the NSUARB as part of the January 1, 2011 rate decision. There was no dividend/grant in lieu of taxes approved for wastewater/stormwater. The Commission is committed to a payment of $3,971 for the 2013 fiscal year.
10.
Supplemental cash flow information

$
2012 1,092 (11) (56) 1,581 (127) 27 (1) 2,505 $
2011
Changes in non-cash operating working capital items Receivables Materials and supplies Prepaids Payables and accruals, trade Accrued interest on long term debt Contractor and consumer deposits Unearned revenue
437 (70) (105) 1,812 (111) 5 26

1,994
Interest paid during the year was $8,100 (2011 - $8,896).
January 9, 2013
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12

March 31, 2012 (in thousands)
11.
Capital management
The Commission's objective when managing capital is to ensure sufficient liquidity to support its financial obligations and execute its operating and capital plans. The Commission monitors and makes adjustments to its capital structure through additional borrowings of long term debt which are then used to finance capital projects. The Commission considers its total capitalization to include all long term debt and total equity. The calculation is set out in the following table:
2012
Long-term debt (current portion) Long-term debt Funded debt Equity Capital under management $
2011
13,109 133.063 146,172 796,431 942,603
13,272 146,118 159,390 778,587 937,977
The Commission is a regulated utility and is subject to the regulations of the NSUARB. As part of this regulation, the Commission must obtain approval by the NSUARB for all borrowings. The Commission has obtained regulatory approval for all borrowings during the fiscal year. The Commission is not subject to financial borrowing covenants.
12.
Financial risk management
Credit risk
Credit risk arises from the possibility that the Commission's customers may experience financial difficulty and be unable to fulfill their obligations. The Commission's maximum exposure to credit risk corresponds to the customer charges and contractual accounts receivable. However, the Commission's customers are numerous and diverse, which reduces the concentration of credit risk. The Commission considers the credit quality of its accounts receivables that are neither past due or impaired to be collectible.
Interest risk Interest risk arises from the possibility that change in interest rate will cause the Commission a potential loss. All of the Commission's long term debt is at varying fixed rates and has staggered maturity dates. The Commission therefore considers its exposure to interest rate fluctuations to be minimal. Market risk Market risk arises from the possibility that the value of an investment will fluctuate as a result of changes in market prices. These changes could affect the market value of the investments in the Commission's employees' pension plan and consequently the plan's deficit. Liquidity risk Liquidity risk arises from the possibility of the Commission not being able to meet its cash requirements in a timely and cost effective mariner. The Commission manages this risk by closely monitoring the cash on hand in comparison to upcoming cash commitments.
January 9, 2013
Page 529
13

March 31, 2012 (in thousands) 13. Related party transactions
Transactions with HRM are recorded at carrying value in accordance with the CICA Handbook Section 3840 "Related Party Transactions". The Commission is obligated to make payments on debt, held in the name of HRM, associated with assets which were transferred to the Commission in the 2007 merger, and subsequent years, associated with wastewater and stormwater assets. Amounts receivable from and payable to HRM have normal credit terms.
14.
Comparative figures
Certain of the comparative figures for 2011 have been reclassified to conform with the financial statement presentation adopted for 2012.
15.
Subsequent event
Subsequent to year end the Commission received approval from the NSUARB for a general rate increase ranging from 6.7% to 13.2% depending on meter size which is anticipated to take effect on July 1, 2012.
January 9, 2013
Page 530
Halifax Regional Water Commission Schedule of utility plant in service

Year ended March 31 (in thousands) Accumulated Depreciation
Schedule A
2012 2011
Cost Water Intangible plant Land and land rights Structures and improvements Pumping equipment Purification equipment Transmission and distribution mains Services Meters Hydrants Tools and work equipment Transportation equipment Office equipment and furniture Small systems Airport Aerotech system $
Net Book Value
Net Book Value
546 $ 15,906 76,585 8,151 25,950 291,295 29,375 11,764 17,025 2,518 4,952 8,667 7,740 595 501,069
165 $
381 $ 15,906 54,278 3,112 10,770 230,340 25,506 8,851 14,486 886 2,266 2,511 6,738 433 376,464
435 15,909 54,271 3,219 11,228 225,255 24,704 8,148 14,244 767 2,324 2,818 6,981 476 370,779
22,307 5,039 15,180 60,955 3,869 2,913 2,539 1,632 2,686 6,156 1,002 162 124,605
Wastewater/stormwater Intangible plant Land and land rights Structures and improvements Pumping and treatment equipment Collection system Manholes and catchbasins Laterals Outfalls Tools and work equipment Transportation equipment Office equipment Small systems Airport Aerotech system 4,001 9,547 153,706 132,261 299,977 6,227 6,825 15,315 784 6,288 904 5,974 3,115 644,924 $ 1,145,993 $ 1,129 2,872 9,547 115,903 122,522 239,963 1,912 6,433 15,150 488 724 528 5,073 2,806 523,921 900,385 $ 3,172 8,573 117,847 124,725 234,527 4,153 5,291 15,226 610 321 422 5,030 2,957 522,854 893,633
37,803 9,739 60,014 4,315 392 165 296 5,564 376 901 309 121,003 245,608 $
Total
During the year, the amount of $195 of interest was capitalized to Utility Plant in Service (2011 $322).
15
Halifax Regional Water Commission Schedule of long term debt

Year ended March 31, 2012 (in thousands) Interest Rate Payable to Municipal Finance Corporation Water Debenture 22 A 1 4.250% to 6.125% Debenture 25 A 1 2.970% to 4.560% Debenture 96 A 1 5.500% to 8.000% Debenture 26 A 1 4.350% to 4.880% Debenture 27 A 1 4.650% to 5.010% Debenture 23 A 1 3.500% to 5.750% Debenture 28 A 1 3.750% to 5.088% Debenture 98 A 1 5.625% to 6.125% Debenture 99 A 1 6.500% to 6.750% Debenture 30 B 1 1.550% to 3.870% Debenture 31 A 1 1.630% to 4.221% Halifax Harbour Solutions Debenture 29 A 1 0.900% to 4.329% Wastewater/stormwater Debenture 30 A 1 1.510% to 4.500% Final Maturity
Schedule B
Balance Remaining 2012 2011
2012 $ 2015 2016 2016 2017 2018 2018 2019 2019 2020 2021 2019 2020
2,310 3,500 400 3,000 5,937 1,200 1,700 21,610 1,800 1,575 1,500 11,700 3,230
2,620 3,750 480 3,200 6,776 1,300 1,800 24,019 2,025 1,750 1,901 12,350 3,400
Payable to Halifax Regional Municipality Municipal Finance Corporation - Wastewater/stormwater Debenture 21 A 1 8.000% to 8.000% 2011 Debenture 21 B 1 3.125% to 6.000% 2011 Debenture 22 A 1 3.375% to 6.125% 2012 Debenture 22 B 1 2012 3.250% to 5.625% Debenture 23 A 1 2013 3.500% to 5.375% Debenture 23 B 1 2013 2.750% to 5.000% 2014 Debenture 24 A 1 2.550% to 5.450% Debenture 24 B 1 2.840% to 5.940% 2024 Debenture 24 C 1 2015 7.000% to 7.000% 2015 Debenture 25 A 1 2.970% to 4.560% Debenture 25 B 1 3.630% to 4.830% 2020 Debenture 26 A 1 4.350% to 4.880% 2016 Debenture 26 B 1 4.265% to 4.410% 2016 Debenture 27 A 1 4.450% to 4.625% 2017 Federation of Canadian Municipalities - Wastewater/stormwater Debenture GMIF 1599 1.330% to 3.127% 2014 Less: debt issue costs Less: amount payable within one year $
88 44 91 9 249 71,604 176 696 135 628 24 394 13,000 146,600 428 146,172 13,109 133,063 $
85 15 176 89 136 13 333 77,138 235 869 169 753 29 460 14,000 159,871 481 159,390 13,272 146,118
The debentures are repayable in fixed annual or semi-annual principal instalments plus interest payable semi-annually. Principal instalments including Halifax Harbour Solutions debt repayment for the next five years are as follows: 2013 2014 2015 2016 2017
January 9, 2013
$ $ $ $ $
13,109 13,186 13,349 13,398 13,428 16

Page 532
Halifax Regional Water Commission Schedule of operations for water service

Year ended March 31, 2012 (in thousands)
Schedule C
2012
Budget (Unaudited) Operating revenues Water service Fire protection Private fire protection services Other operating revenue Bulk water stations Customer late payment fees Miscellaneous $ 30,393 9,502 369 289 129 114 40,796
Actual
2011 Actual
30,562 9,502 366 264 206 155 41,055
30,719 9,502 362 278 146 183 41,190
Operating expenditures Water supply and treatment Water transmission and distribution Engineering and information services Environmental services Customer service Administration and pension Depreciation
6,800 8,768 3,131 655 1,809 3,361 6,510 31,034 9,762
6,598 7,834 2,958 628 1,696 3,628 6.458 29,800 11,255
6,286 7,928 2,827 507 1,696 3,327 6,263 28,834 12,356
240 170 410
201 106 307
273 208 481
Financial and other expenditures Interest on long term debt Repayment of long term debt Amortization of debt discount Grant in lieu of taxes
2,527 5,132 55 3,882 11,596
2,472 4,904 51 3.944 11,371
2,806 4,925 58 3,749 11,53$
Excess of (expenditures over revenues) revenues over expenditures
(1,424)
191
1,299
17
Halifax Regional Water Commission Schedule of operations for wastewater/ stormwater services
Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues $ Wastewater/stormwater services Other operating revenue Leachate and other contract revenue Septage tipping fees Overstrength surcharge Customer late payment fees Miscellaneous 53,760 878 400 240 221 184 55,683 $
Schedule D
Actual
2011 Actual
54,383 807 747 165 141 177 56,420
45,532 556 552 232 119 176 47,167
Operating expenditures Wastewater/stormwater collection Wastewater treatment Engineering and information services Environmental services Customer service Administration and pension Depreciation
15,307 18,289 3,044 1,772 1,742 3,232 5,572 48,958 6,725
15,008 16,380 2,855 1,662 1,634 3,493 4,889 45,921 10,499
13,562 17,139 2,762 1,607 1,633 3,209 2,602 42,514 4,653
240 2,024 2.264
201 2,087 2,288
272 2,071 2,343
Financial and other expenditures Interest on long term debt Repayment of long term debt Amortization of debt discount
5,587 8,013 3 13,603 $ (4,614)
5,593 8,120 13 13,726 (939) $
6,056 8,193 12 14,261 (7,265)
Excess of expenditures over revenues
18
Halifax Regional Water Commission Airport Aerotech system Schedule of operations for water service
Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues Metered sales Fire protection Customer late payment charges Miscellaneous Operating expenditures Water supply and treatment Water transmission and distribution Depreciation Operating loss Financial and other expenditures Interest on long term debt Repayment of long term debt Excess of expenditures over revenues $ (183) $ $ 524 142 5 671 693 117 44 854 L183) $ Actual
Schedule E
2011 Actual
537 142 1 5 685 563 94 42 699 (14) 24 29 53 (67)
503 142 1 5 651 537 103 42 682 (31) 23 27 50
(81)
19
Schedule E Halifax Regional Water Commission Airport Aerotech system Schedule of operations for wastewater service
Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues Metered sales Dewatering Airplane sewage Area charges Customer late payment charges $ 514 100 40 35 1 690 $ Actual 2011 Actual
528 98 40 1 667
501 98 34 38 1 672
Operating expenditures Wastewater treatment Wastewater/stormwater collection Depreciation
641 99 740 (501
733 62 26 821 (154)
696 89 17 802 (130)
Operating loss Financial and other expenditures Interest on long term debt Repayment of long term debt
11 13 24 $ $ (50) (178) $
11 13 24 (154)
Excess of expenditures over revenues Excess of expenditures over revenues for water and wastewater combined
(233)
(245)
(235)
The Commission no longer provides stormwater services for the Airport Aerotech system effective November 18, 2011.
20
Halifax Regional Water Commission Schedule of regulated activities

Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues Water service Wastewater/stormwater services Public fire protection Private fire protection services Airport Aerotech system Other operating revenue Operating expenditures Water supply and treatment Water transmission and distribution Wastewaterfstormwater collection Wastewater treatment Environmental services Engineering and information services Customer service Administration and pension Airport Aerotech system Depreciation Financial and other revenues Interest Other Financial and other expenditures Interest on long term debt Repayment of long term debt Amortization of debt discount Grant in lieu of taxes Excess of expenditures over revenues $ 30,393 53,760 9,502 369 1,221 1,177 96,422 6,789 8,768 15,307 17,623 2,427 6,175 3,551 6,593 1,594 12,082 80,909 480 2 080 2,560 8,114 13,145 58 3,882 25,199 (7,126) $ $ Actual
Schedule F
2011 Actual
30,562 54,383 9,502 366 1,214 1,070 97,097 6,584 7,834 15,008 15,716 2,290 5,813 3,330 7,121 1,520 11,347 76 563 402
30,719 45,532 9,502 362 1,191 1,114 88,420 6,258 7,928 13,562 16,062 2,114 5,589 3,329 6,536 1,484 8,865 71,727 545 2,077 2,622 8,896 13,158 70 3,749 25,873
2.1344
2,446 8,100 13,066 64 3,944 25,174 (2,194) $
(6,558)
21
Halifax Regional Water Commission Schedule of unregulated activities

Year ended March 31, 2012 (in thousands) 2012 Budget (Unaudited) Operating revenues Dewatering Airplane sewage Leachate treatment & contract revenue Septage tipping fees Other operating revenue Operating expenditures Water supply and treatment Wastewater treatment Financial and other revenues Other Excess of revenues over expenditures $ 100 40 878 400 1,418 11 666 677 114 855 $ Actual
Schedule F
2011 Actual
98 40 807 747 38 1,730 14 664 678 149 1,201
98 34 556 552 20 1,260 28 1,077 1,105 202
357
22
APPENDIX 6
ITEM # 4
HRWC BOARD December 14, 2012 Page 1 of 7 HALIFAX WATER UNAUDITED BALANCE SHEET AS OF NOVEMBER 30, 2012
2013 '000 ASSETS Cash Amounts Receivable Customers & Contractual Halifax Regional Municipality Materials & Supplies Prepaid Expenses $43,102
2012 '000
$17,167
$22,176 $609 $1,183 $269 $67,339 $4,156 $501,028 $644,927 $129,643 $126,036 $894,431 $62,665 $957,097 $6 $819 $1,025,260
$23,080 $13,302 $1,226 $158 $54,933 $3,464 $486,806 $626,117 $120,949 $108,452 $886,986 $30,846 $917,831 $163 $448 $973,375
Regulatory Asset Plant in Service - Water Plant in Service - Wastewater/Stormwater Less: Accumulated Depreciation - Water Accumulated Depreciation - Wastewater/Stormwater Plant Under Construction
Other Unamortized Debt Discount & Issue Expense
LIABILITIES & CAPITAL Trade Interest on Long Term Debt Halifax Regional Municipality Contractor & Customer Deposits Unearned Revenue $7,195 $2,152 $4,101 $170 $3,527 $17,146 $741 $2,970 $5,917 $11,328 $52,798 $132,977 $223,877 $772,069 $10,642 $12,380 $3,244 $3,049 $801,384 $1,025,260
January 9, 2013 KAFINANCE\ConfidentialRate Hearings120131Appl cationVkppendix 6 Unaudited Financial Statements Nov 2012
$11,267 $1,934 $7,822 $146 $3,367 $24,536 $803 $2,739 $4,372 $8,545 $45,241 $103,867 $190,103 $753,661 $11,425 $8,660 $7,957 $1,569 $783,273 $973,375
Page 539
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HRWC BOARD September 17, 2012 Page 6 of 7 HALIFAX WATER UNAUDITED INCOME STATEMENT -AIRPORT! AEROTECH OPERATIONS APRIL 1112 - NOVEMBER 30112 (8 MONTHS) 66.67% ACTUAL (YEAR TO DATE) THIS YEAR LAST YEAR APR 1/12 MAR 31/13 BUDGET APR 1/12 MAR 31/13 FORECAST
DESCRIPTION AIRPORT! AEROTECH WATER OPERATIONS REVENUE METERED SALES FIRE PROTECTION OTHER CONNECTION CHARGE CUSTOMER LATE PAY./COLLECTION FEES EXPENSES PLANT OPERATIONS PUMPING STATIONS TRANSMISSION & DISTRIBUTION CUSTOMER SERVICE ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES ADMINISTRATION & PENSION DEPRECIATION FINANCIAL EXPENSES ALLOCATION OF LONG TERM DEBT INTEREST ALLOCATION OF LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES AIRPORT! AEROTECH WASTEWATER OPERATIONS REVENUE - REGULATED METERED SALES CUSTOMER LATE PAY./COLLECTION FEES REVENUE - NON-REGULATED DEWATERING AIRLINE EFFLUENT EXPENSES TREATMENT PLANT COLLECTION SYSTEM-WASTEWATER CUSTOMER SERVICE ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES ADMINISTRATION & PENSION DEPRECIATION FINANCIAL EXPENSES LONG TERM DEBT INTEREST LONG TERM DEBT APPROPRIATION AMORTIZATION DEBT DISCOUNT NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES AIRPORT! AEROTECH STORMWATER OPERATIONS REVENUE - REGULATED AREA CHARGES CUSTOMER LATE PAY./COLLECTION FEES EXPENSES COLLECTION SYSTEM - STORMWATER CUSTOMER SERVICE ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES ADMINISTRATION & PENSION DEPRECIATION NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES
% of FORECAST
$367,587 $101,729 $3,554 $505 $473,375 $346,717 $10,790 $45,665 $1,135 $1,442 $339 $2,691 $28,080 $436,859 $23,404 $28,684 $0 $52,088 ($15,572)
$381,995 $94,399 $3,502 $640 $480,536 $347.813 $8,925 $16,125 $1,041 $1,289 $341 $2,401 $29,640 $407,575 $14,432 $17,804 $0 $32,237 $40,725
$516,080 $141,598 $4,707 $500 $662,885 $694,912 $28,031 $177,474 $1,758 $2,438 $558 $3,350 $44,375 $952,896 $28,636 $32,886 $0 $61,522 ($351,533)
$569,517 $156,259 $4,982 $500 $731,258 $529,653 $27,930 $94,430 $1,743 $2,420 $548 $4,407 544,376 $705,507 $34,389 $52,388 $0 $86,777 ($61,026)
64.54% 65.10% 71.33% 100.92% 64.73% 65.46% 38.63% 48.36% 65.11% 59.59% 61.91% 61.06% 63.28% 61.92% 68.06% 54.75% 0.00% 60.03% 25.52%
$300,077 $536 $300,613 $111,826 $25,034 $136,861 $528,429 $23,162 $908 $1,154 $708 $2,153 $20,040 $576,553 $7,463 $8,199 $0 $15,662 ($154,742)
$379,947 $827 $380,773 $65,233 $24,100 $89,333 $397,864 $41,862 $728 $897 $753 $1,679 $56,696 $500,479 $7,123 $8,787 $0 515.910 ($46,281)
$492,448 $500 $492,948 $97,850 $40,000 $137,850 $732,021 $60,818 $1,407 $1,951 $1,146 $2,680 $48,071 $848,094 $40,004 $31,166 $0 $71,170 ($288,466)
$554 238 $500 $554.738 $182 255 $74,284 $256,539 $712,982 $61,214 $1,394 $1,936 $1,111 $3,526 $48.070 $830,233 $40.004 $31,166 $0 $71,170 ($90,126)
54.14% 107.10% 54.19% 61 36% 33.70% 53.35% 74.12% 37.84% 65.15% 59.59% 63.71% 61.05% 41.69% 69.44% 18.66% 26.31% 0.00% 22.01% 171.70%
$0 $0 $0 $0 $0 $0 $0 $0 50 $0 $0
$0 $0 $0 $388 $82 $109 $188 $195 $0 $963 ($963)
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 SO $0 $0 $0 $0 $0
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
($170,314)
($6,519)
($639,999)
($151,152)
112.68%
KAFINANCEConfidentiaaRate Hearings120131Appication'Appench 6 Unaudited Financial Statements Nov 2012
January 9, 2013
Page 544
IIM ##4
HRWC BOARD December 14, 2012 Page 7 of 7 HALIFAX WATER UNAUDITED INCOME STATEMENT - REGULATED AND UNREGULATED OPERATIONS APRIL 1/12 - NOVEMBER 30/12 (8 MONTHS) 66.67%
DESCRIPTION REGULATED ACTIVITIES REVENUE METERED SALES FIRE PROTECTION PRIVATE FIRE PROTECTION AIRPORT AEROTECH SYSTEM OTHER OPERATING REVENUE EXPENSES WATER SUPPLY & TREATMENT TRANSMISSION & DISTRIBUTION WASTEWATER & STORMWATER COLLECTION WASTEWATER TREATMENT PLANTS SMALL SYSTEMS SCADA, CONTROL & PUMPING ENGINEERING & INFORMATION SERVICES ENVIRONMENTAL SERVICES CUSTOMER SERVICE AIRPORT AEROTECH SYSTEM ADMINISTRATION & PENSION DEPRECIATION
ACTUAL (YEAR TO DATE) THIS YEAR LAST YEAR
APR 1/12 MAR 31/13 BUDGET
APR 1/12 MAR 31113 FORECAST
% of FORECAST
$61,306 $6,528 $243 $774 $915 ;69,766 $3,713 $4,429 $8,677 $9,398 $1,146 $1,059 $3,971 $1,532 $2,231 $1,013 $5,378 $9,405 $51,953
$57,686 $6,335 $239 $861 $773 $65,894 $3,614 $5,063 $9,132 $9,338 $1,004 $896 $3,548 $1,466 $2,082 $909 $4,797 $8,059 $49,910
$84,793 $9,502 $367 $1,156 $1,190 $97,008 $6,507 $7,996 $14,980 $16,206 $1,771 $1,763 $6,608 $2,486 $3,513 $1,801 $6,693 $15,034 $85,358
$91,269 $9,843 $367 $1,286 $1,230 $103,995 $6,476 $7,755 $14,643 $14,638 $1,774 $1,761 $6,605 $2,406 $3,482 $1,536 $8,805 $14,335 $84,216
67.17% 66.32% 66.28% 60.19% 74.35% 67.09% 57.33% 57.11% 59.26% 64.21% 64.57% 60.16% 60.11% 63.69% 64.06% 65.99% 61.08% 65.61% 61.69%
FINANCIAL REVENUE INVESTMENT INCOME MISCELLANEOUS FINANCIAL EXPENSES LONG TERM DEBT INTEREST LONG TERM DEBT PRINCIPAL AMORTIZATION DEBT DISCOUNT DIVIDEND/GRANT IN LIEU OF TAXES NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES
$422 $1,369 $1,791 $5,075 $9,406 $53 $2,648 $17,182 $2,422
$243 $1,370 $1,613 $5,490 $8,697 $43 $2,588 $16,818 $779
$480 $2,136 $2,616 $8,456 $13,693 $97 $3,932 $26,177 ($11,911)
$700 $2,149 $2,849 $8,137 $14,719 $91 $3,971 $26,918 ($4,289)
60.30% 63.67% 62.85% 62.37% 63.90% 58.71% 66.67% 63.83% 156.48%
UNREGULATED ACTIVITIES REVENUE AEROTECH SEPTAGE TIPPING FEES LEACHATE CONTRACT REVENUE DEWATERING AIRLINE EFFLUENT MISCELLANEOUS EXPENSES WATER SUPPLY & TREATMENT WASTEWATER TREATMENT FINANCIAL REVENUE MISCELLANEOUS NET PROFIT (LOSS) AVAILABLE FOR CAPITAL EXPENDITURES
$481 $161 $143 $112 $25 $21 $943 $6 $455 $461 $145 $145 $626
$515 $195 $321 $65 $24 $24 $1,144 $9 $426 $435 $81 $81 $791
$400 $339 $446 $98 $40 $24 $1,347 $10 $693 $703 $121 $121 $765
$600 $339 $160 $182 $74 $24 $1,380 $10 $778 $788 $119 $119 $711
80.15% 47.60% 89.68% 61.36% 33.70% 85.81% 68.37% 65.64% 58.49% 58.58% 121.69% 121.69% 88.15%
$3,049
$1,569
($11,146)
($3,578)
185.20%
KAFINANCE1ConfidentialRate Hearings120131ApplicationkAppendix 6 Unaudited Financial Statements Nov 2012
January 9, 2013
Page 545
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APPENDIX 7
Halifax Water
Energy Cost Forecasting Tool
J. Knapp, October 4, 2011
Forecast Period: 2013/14

Electricity Forecast 2014 Increase (%) Adjusted Energy Cost (0 Heating Oil Adjusted Energy Cost (S)' 10.0% r W JD Kline Lake Major tannery Lake Misc - Pumpint. Stations otals - Water Annual Increase (%) Wastewater Halifax Dartmouth Mill Cove Herring Cove Eastern Passage Timberlea Aerotech North Preston Springfield Lake Fall River Middle Musq Frame Belmont Uplands Park Wellington Misc. -Pumping Stations Totals - Wastewater Annual Increase (%) Totals - Combined System I 7.9% 7.9% 7.3% 8.4% $824,153 $796,149 $84,079 5455,809 $2,160,189 103.3% 7.9% 7.9% 7.9% 7,3% 7.3% 7.3% 7_3% 7.3% 7.3% 7.3% 7.3% 9.0% 7.3% 7.3% 7.3% 8.4% $1,111,293 $596,571 $370,185 $211,112 $56,370 $46,534 $168,433 $23,696 $14,172 $21,688 $5,632 $3,921 $2,416 $1,471 $13,078 51,609,545 $4,256,217 108.3% $6,416,406 108.3% $67,578 $65,647 $0 $0 $133,225 110.0% $0 $0 $8,603 5160,480 $15,093 $4,501 $980 $0 $0 $0 $0 $0 $0 $0 $0 $0 $189,657 110.0% $322,882 199.8% Natural Gas Adjusted Energy Cost (5) : i $O $0 $0 $0 $0 0.0% $95,985 $74,091 $0 $0 $0 50 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $170,076 105.3% $170,076 105.3%
Forecast Period: 2014/15

Electricity Adjusted Energy Cost (5) Heating Oil Adjusted Energy Cost ($) 10 0rx, 906,569 875,763 92,486 501,390 2,376,208 110.0% 1,222,422 656,338 407,204 232,223 62,007 51,188 185,276 26,066 15,589 23,856 6,195 4,313 2,657 1,618 14,386 1,770.500 4,681,839 110.0% $7,058,047 110.0% $74,336 $72,212 $0 $0 $146,547 110.0% $0 $0 $9,463 $176,528 516,602 $4,951 $1,078 $0 $O $0 $0 $0 $0 $0 $0 50 $208,622 110.0% $355,170 110.0%_ $7,589,245 109.8% $99,344 $76,684 $0 $0 $0 $0 $0 $0 $0 50 $0 $0 $0 $0 $0 $0 $176,029 103.5% $176,029 1035% Natural Gas Adjusted Energy Cost (5) , .-
fadlity
$0 $0 $0
so
$0 0.0%
Mai Energy Costs
$6,909,363 112.3%
Notes (a) Potable water includes only potable water used in the treatment process Does not include any used for domestic uses (h) Energy costs do r ot include HST.
January 9, 2013
Page 547
Plant
Chemical
Measurement 8 Company
per 2012/13 Price List
per 2012/13 Budget
Rate (5/ kg)
Rate net HST CS/
Rate (S/ kg)
Rate net HST ($/ kg)
JD Kline Chlorine Carbon Dioxide Potassium Permanganate Lime Alum Polymer Treatment HFS Polyphosphate Sodium Hydroxide (Caustic Soda) I Sodium Hypochlorite Vita-d-Chlor Waste Polymer Lake Major Chlorine Carbon Dioxide - monthly tank rental Potassium Permanganate Lime Alum Polymer Treatment HFS Polyphosphate Sodium Hydroxide (Caustic Soda! Vita-d-Chlor Waste Polymer Scenery Carbon Dioxide Potassium Permanganate Lime Alum Po mer Treatment Pahosphate Sodium H droxide (Caustic Soda). Sodium H pochlorite Regional Services - Water Quality Sodium Hypochlorite Small Systems Potassium Permanganate Alum Polymer Treatment Polyphosphate Sodium Hydroxide [Caustic Soda) Vitec Citric Acid Soda Ash Sodium Hypochlorite Sodium Bi-sulphite Sulfuric Acid Cleaning Chemicals Otter Lake Sodium Hzpochlorite Water - Total est est est est est est est est est est est est est est est est est est est est Brenntag($ per KO $1.05 mtagAper KG
$1.05
$4.10 $0.37 $0.34
..Canada Colors - 25KG Pails $ per KG

Graymont - Bulk MT General Chemical - KG Dry Basis $ per KG
$10 76
Brenntag - HFS - $ per KG Brenntat $ Per KG $098 $4.44 $0 74
51.103 $0.296 $4.305 $0.384 50.357 511.235
$1.150
50.309
54.490 $0.401 $0.372 $11.717
51.028
51.072
54.862
$1.16 50.311 $4.520 50.404 50.375 511.797 51.079
$1207
50.324 $4 714 50.421 50.391 $12 303 $1 126
54.662
$0.000
50.000 50.000 50.000 50.000
54.895 $0.000 S0.000 50.000 50.000
55105 50.000 50.000 50.000 50.000
S0.28
Canada Colors 2SKG Pails - $ per KG Graymont Bulk MT General Chemical - KG Dry Basis - $ per KG Brenntag (per KG) price changes per usage $ per KG
51.103 $0.296
$1.150
$4.10
50.37
50.384
50.357
$0.309 $0.000 $0.000 $0.401

50.372 59.182
$1.158 50.311
$1.207 $0.324
50.000 50.000 50.404

50.375 59.244
$0.000 50.000 $0.421

50.391 $9.641
$0.34
50.97
$0.74
$8 804
$1 018 $4 662 $0 000
$7.72
$8 110
51.062 54.862 50.000 50.000 58.458
$1.069 51 115 $4.895 55 105 50.000 50.000 50.000 50.000 58.515 $8.881
est
est
est est est est est est est est
est est
cut
est est est est est
January 9, 2013
Page 548
Budrt - 2014/15 Budget Price increase: Plant per 2012/13 Price List per 2012/13 Budget Rate 35#. Rate net HST (5/ kgl . ._ . . Rate Rate net HST
Chemical
Measurement & Company
0/ kg)
(5/ kg)
IS/ klf)
Halifax Carbon
*Alum
HaAlex
Polymer Treatment
Sodium Hydroxide (Caustic Soda) Sodium Hypochlorite Sulfuric Acid Foam Suppressants
Alpha Chemical KG Wet Basis - Sper KG Cationic - SNF - $ per KG Anaionic - SNF - per KG Alpha Chemical - 1,100 L Totes - $ ser I. Alpha Chemical - 1,1001 Totes - Sper
$0.17 55,95
$1.72
$0.74 $0.70
est est 50.180 50.187 $0 189 $0.197 $6.494 $6.227 $6 538 $6.818 50000 50.000 50.000 50.000 $0.810 50.777 50.816 $0.851 $0.735 50.767 $0.772 50.805
Herrin/Cove Carbon Alum Pi:liner Treatment 'SodiumFlydroxide (Caustic Sodal r. Sodiurr-1 y pochlorite Sulfuric Acid Alpha Chemical- KG Wet Basis -$ per KG Cationic - SNF %per KG Anaionic SNF - Sper KG Alpha Chemical - 1,100 L Totes S per KG Alpha Chemical- 1,1001 Totes $ per L $0.17 50.180 $6 227 est 50.187 $6.494 50.000 $0189 56.538 $0.000 est $0.197 $6 818 50.000 $0.851
55.93 54.72
$0.74 $0.70
..
SO.0015 50.777
SO 735
50.810
$0367
50.816
$0 772
50.805
Timberlea Lime Alum Sodium Hypochlorite Sodium Hypochlorite (51 jug) Dartmouth Carbon est Alpha Chemical KG Wet Basis $ per KG Cationic SNF $ ,per KG Anaionic - SNF $ per KG Alpha Chemical- 1,100 L Totes - $ per KG Alpha Chemical- 1,100 L Totes - $ ner L $0.17 5593 est G raymont Bulk MT -S per KG Alpha Chemical - KG Wet Basis - $ per KG Alpha Chemical - 1,1001 Totes - 5 per L $0.37 $0.17 $0.70 $0 384 $0180 $0 735
50.401 50.187 50.767
50.404 50.189 50.772
50.421 50.197 50.805
+Alum +Polymer Treatment

-Sodium HydroxideMistic Soda) (Sodium Hypochlorite finer Waste Foam Suppressants Eastern Passage Chlorine Carbon Sodium Hydroxide Caustic Soda) Sodium Hypochlorite Mill Cove I, Carbon +Sodium Hydroxide (Caustic Soda] Hypochlorite (2051 drum] Sodium Hypochlorite (1,1001 Totes!.
50180 $6.227
$4.72
50.74 $0.70
50.187 $0 189 $6494 $6.538 Sacial 50.000 Mom 50.777 50.810 50.816 50.735 50.767 50.772
50.197 56.818
50.000 50.851 50.805
Brennteg - $ per KG Alpha Chemical - 2051 Drum $ per KG Alpha Chemical - 2051 Drum $ er L
$1.05
$1103
51.150 50.898 50.843
51.158 50.904
51.207
50.82
$0.77
50.861
50.809
50.849
50.943 50.885
Alpha Chemical - 2051 Drum $ per KG Alpha Chemical - 2051 Drum $ per 1 Alpha Chemical - 1,1001 Totes per L
$0.80 $0.77 $0.70
$0.000 $0.840 50.809 $0.000
50.000 50.876 50.843 50.000
50.000 50.882 50.849 50.000
50.000 50.920 50.885 50.000
Small Systems Alum Sodium Hydroxide iCaustic Soda) Sodium Hyrchlorite {205L drum) Sodium FArLsochlorite Atrotech Alum Sodium Hydroxide )Caustic Soda) Sodium Hypochlorite 151 jug) Alpha Chemical - KG West Basis - $ per KG Brenntag - $ per KG Alpha Chemical - 205L Drum - $ per KG Alpha Chemical - 2051 Drum - $ per I. Alpha Chemical - 1,1001 Totes - S per L $0.81 $0.77 $0.70
$0.000
50.851
50.809 50.735
50.000 50.887 50.843 50.767
50.000 50.893 $0.849 50.772
50.000 50.931 50.885 50.805
$0.17 $074
50.180 50.777 50.000
50.187 50.810 50.000
50 189 50.816 50.000
50.197 50.851 50.000
Carbon Polymer Treatment Wastewater Collection - East Bioxide
50.000
50.000
50.000
50.000
50.000 50.000
50.000 50.000
r5.#
Wastewater Total Combined Water and Wastewater
January 9, 2013
Page 549
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APPENDIX 8
PROPOSED SCHEDULE OF RULES & REGULATIONS FOR WATER, WASTEWATER, AND STORMWATER SERVICES HALIFAX REGIONAL WATER COMMISSION
January 7, 2013
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Table of Contents PART I INTERPRETATION 1. 2. 3. 4. Short Title Adoption of Statutory Definitions Definitions Interpretation
PART II RATES 5. Rates for Water Services 6. Rates for Wastewater Service 7. Rates for Stormwater Service 8. Charge for Temporary Water, Wastewater or Stormwater Service 9. New Water or Wastewater Account Charge PART III BILLING 10. Payment of Bills 11. Adjustment of Bills 12. Estimated Reading for Billing Customers 13. Suspension or Refusal of Service 14. Collection of Overdue Bills 15. Customer Bill Retrievals / Copies 16. Dishonoured Payments 17. Deposits PART IV CHARGES 18. Connection/Disconnection of Service 19. Water Meter Installation 20. Customer Monitoring Service 21. Inspection of New Building Service Connections 22. Rebate 23. Extra Strength Wastewater Surcharge 24. Review of Drawings and Specifications 25. Missed Appointment by Customer 26. Theft of Service 27. Designated Bulk Fill Station 28. Area Master Capital Cost Contribution Charge 29. Sewer Redevelopment and Trunk Sewer 30. Capital Cost Charge for Wastewater Treatment Facilities 31. Recovery of Costs PART V FIRE PROTECTION CHARGES
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32. Public Fire Service Charge 33. Public Fire Protection Rate 34. Special Service Supplied from Fire Hydrants 35. Building Fire Protection Systems PART VI - PROVISION OF SERVICE 36. Liability for Payment of Service 37. Plumbing to be Satisfactory 38. Prohibited Appliances 39. Improper Use of Water, Wastewater, and/or Stormwater 40. Capacity of Wastewater and/or Stormwater Facilities 41. Pipe Installation 42. Unauthorized Extensions, Additions, or Connections 43. Interference with Commission Water Services 44. Interference with Commission Wastewater and/or Stormwater Services
PART VII - METERING 45. Water to be Supplied Only By Meter 46. Installation and Removal of Water Meters 47. Location of Water Meters 48. Master Water Meters 49. Damage to Water Meters 50. Meter Testing PART VIII WATER SERVICE 51. Water Building Service Connection 52. Water Service Cross Connection Control & Backflow Prevention 53. Alternate Water Supply Prohibited 54. Repairs to Water Building Service Connection 55. Water Service Pressure Reducing Valves 56. Water Service Control Valves 57. Water Conservation Directives 58. Acceptance of Private Community Water, Wastewater and Stormwater Systems PART IX - FIRE PROTECTION 59. Fire Protection Service Pipes 60. Private Fire Protection PART X - WASTEWATER AND STORMWATER SERVICE
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61. Wastewater and/or Stormwater Building Service Connections 62. Repairs to Wastewater and/or Stormwater Building Service Connections PART XI - WASTEWATER AND STORMWATER DISCHARGE 63. Discharge into Wastewater Facilities 64. Stormwater Discharge to Wastewater Facilities 65. Wastewater Service Extra Strength Discharge 66. Discharge into the Stormwater System 67. Wastewater Discharges to Stormwater Systems 68. Swimming Pools and Spas PART XII PRETREATMENT 69. Pretreatment Facilities 70. Food Related Grease Traps or Interceptors 71. Vehicle and Equipment Service Oil and Grease Interceptors 72. Sediment Interceptors PART XIII - MONITORING, SAMPLING AND REPORTING 73. Wastewater Service Reporting Requirements 74. Wastewater Service Compliance Agreement 75. Monitoring, Sampling and Reporting 76. Wastewater and/or Stormwater Service Sampling and Analytical Requirements 77. Wastewater and/or Stormwater Monitoring Access Point 78. Spills 79. Offences
Attachment 1: Procedure for Acceptance of Private Community Water Systems Attachment 2: Extra Strength Surcharge Formula Attachment 3: Water, Wastewater, and Stormwater Capital Cost Contribution Policy Form 1: Abbreviated Discharger Information Report Form 2: Detailed Discharger Information Report List of Tables Table 1. Base Rate for Water Service Table 2. Non-metered Service Table 3. Base Rate for Wastewater Service Table 4. Non-metered Service Table 5. Proposed Regional Development Charge for Wastewater Table 6. Proposed Regional Development Charge for Water Table 7. Charges for Sprinklers
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Table 8. Limits for Discharge to Wastewater Facilities Table 9. Limits for Discharge to Stormwater System
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Regulations Respecting Rates and Charges for the Provision of Water, Wastewater, Stormwater, Public and Private Fire Protection Service, made by Order of the Nova Scotia Utility and Review Board, dated June XX, 2013
PART I INTERPRETATION
1. These regulations may be cited as the Halifax Regional Water Commission Regulations. 2. All terms defined in the Halifax Regional Water Commission Act have the same meaning in these regulations, unless otherwise defined. Definitions 3. In these Regulations, a. "Accredited Laboratory" means any laboratory accredited by an authorized accreditation body in accordance with a standard based on "CAN-P-1585: Requirements for the Accreditation of Environmental Testing Laboratories" established by the Standards Council of Canada, as amended, or "ISO/IEC/EN 17025: General Requirements for Competence of Calibration and Testing Laboratories" established by the International Organization for Standardization, as amended; b. Adverse Effect means an effect that impairs or damages the environment, including an adverse effect respecting the health of humans or the reasonable enjoyment of life or property; c. "Best Management Practices (BMP)" means an integrated plan to control and reduce the release of restricted and prohibited substances into wastewater facilities or stormwater systems to a practicable extent, through methods including physical controls, pretreatment processes, operational procedures and staff training; d. "Biochemical Oxygen Demand (BOD)" means the five-day BOD being the determination of the molecular oxygen utilized during a five-day incubation period for the biochemical degradation of organic material (carbonaceous demand), and the oxygen used to oxidize inorganic material, including sulphides and ferrous iron, and the amount of oxygen used to oxidize reduced forms of nitrogen (nitrogenous demand) as determined by the appropriate procedure in Standard Methods; e. "Biosolids" means on organic, stabilized material produced during the treatment of domestic sewage or wastewater and septage sludge which has undergone secondary treatment to reduce pathogen content; f. "Blow Down" means the discharge of recirculating non-contact cooling water for the purpose of discharging materials contained in the water;
g. "Chemical Oxygen Demand (COD)" means a measure of the capacity of water to consume
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oxygen as a result of oxidation of inorganic chemicals and decomposition of organic matter; h. "Combined Sewer" means a sewer intended to function simultaneously as a stormwater and a wastewater sewer; i. "Combustible Liquid" means a liquid that has a flash point not less than 37.8 degrees Celsius and not greater than 93.3 degrees Celsius; "Composite Sample" means a volume of wastewater, stormwater, uncontaminated water, clear-water or effluent made up of three or more grab samples that have been combined automatically or manually and taken at intervals during the sampling periods;
j.
k. "Customer" means a person who arranges to be or is supplied with water and/or wastewater service at a specified location or locations and includes a person receiving stormwater service; l. "Discharge" means to discharge, release, permit or cause to be discharged or released into wastewater facilities or stormwater systems vested in or under the control of the Commission;
m. "Discharger" means an owner, occupant or person who has charge, management or control of effluent, sewage, wastewater, stormwater, uncontaminated water or any combination thereof, which is discharged to wastewater facilities or stormwater systems vested in or under the control of the Commission; n. Ditch means a man-made open channel owned by the Commission. o. "Dwelling Unit" means the whole or any part of a building or structure that is kept or occupied as a permanent or temporary residence and includes (i) a building within the curtilage of a dwelling unit that is connected to it by a doorway or by a covered and enclosed passage-way, and (ii) a unit that is designed to be mobile and to be used as a permanent or temporary residence, regardless of whether it is being used as such a residence; p. Extraneous Water means water originating from a source other than the Commissions water supply; q. Extra Strength Wastewater means wastewater released to a sewer that is higher in concentration for one or more constituent concentrations as set out in Table 6 in these regulations; r. "Fuel" includes alcohol, gasoline, naphtha, diesel fuel, fuel oil or any other ignitable substance intended for use as a fuel;
s. "Grab Sample" means a volume of wastewater, stormwater, uncontaminated water or effluent which is collected over a period not exceeding 15 minutes; t. "Hauled Waste" means any industrial waste which is transported to and deposited into any location in a wastewater facility, excluding hauled wastewater;
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u. "Hauled Wastewater" means waste removed from a wastewater facility, including a cesspool, a septic tank, a vault privy or pit privy, a chemical toilet, a portable toilet or a wastewater holding tank; v. "Hazardous Substance" means: i) any substance or mixture of substances, other than a pesticide, that exhibits characteristics of flammability, corrosivity, reactivity or toxicity; and
ii) any substance that is designated as a hazardous substance within the meaning of any applicable provincial or federal legislation, as amended from time to time; w. "Hazardous Waste" means any Hazardous Substance disposed of as waste; x. "HRM" means the Halifax Regional Municipality; y. "Ignitable Waste" means a substance that: i) is a liquid, other than an aqueous solution containing less that 24 percent alcohol by volume, and has a flash point less than 93 degrees Celsius, as determined by the Tag Closed Cup Tester (ASTM D-56-97a), the Setaflash Closed Cup Tester (ASTM D-382897 or ASTM D-3278-96e1), the PenskyMartens Closed Cup Tester (ASTM D-93-97), or as determined by an equivalent test method;
ii) is a solid and is capable, under standard temperature and pressure, of causing fire through friction, absorption of moisture or spontaneous chemical changes and, when ignited, burns so vigorously and persistently that it creates a danger; iii) is an ignitable compressed gas as defined in the regulations under applicable provincial or federal legislation, as amended; or iv) is an oxidizing substance as defined in the regulations under applicable provincial or federal legislation, as amended; z. "Industrial, Commercial or Institutional" includes or pertains to industry, manufacturing, commerce, trade, business, or institutions and includes multi-unit dwellings of four or more units; aa. "Infrastructure Charge" means a development charge levied as a condition of subdivision approval or at a building permit stage; bb. "Interceptor" means a receptacle that is installed on a building service connection to prevent oil, grease, sand or other materials from passing into a sewer; cc. "Leachate" includes any liquid that has percolated through solid waste and, during percolation, has extracted dissolved or suspended materials from such solid waste, including the liquid produced from the decomposition of waste materials and liquid that has entered the waste material from external sources including surface drainage, rainfall and groundwater; dd. Non-contact Cooling Water means water that is used in a process for the purpose of
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removing heat and that has not, by design, come into contact with any raw material, intermediate product, waste product, or finished product, but does not include blow down water; ee. NORM means naturally occurring radioactive material found in industrial wastes or byproducts enriched with radioactive elements found in the environment, including uranium, thorium and potassium and any of their decay products, such as radium and radon. ff. "Monitoring Access Point" means an access point, including a chamber, in a wastewater or stormwater building service connection to allow for observation, sampling and flow measurement of the wastewater, uncontaminated water or stormwater within such a service connection; gg. "Pathological Waste" includes fluids or materials which may contain pathogens of human or animal origin; hh. "PCBs" means any monochlorinated or polychlorinated biphenyls or any mixture of them or a mixture that contains one or more of them; ii. "Pesticides" includes any substance that is a pest control product within the meaning of the "Pest Control Products Act" (Canada) or a fertilizer within the meaning of the "Fertilizers Act" (Canada) and that contains a pest control product; jj. "Phenolic Compounds" means hydroxyl derivatives of benzene and its condensed nuclei; kk. Pretreatment Facility means wastewater treatment processes designed to remove pollutants from wastewater prior to discharge to a wastewater facility operated by the Commission. ll. "Reactive Waste" means a substance that: i) is normally unstable and readily undergoes violent changes without detonating;
ii) reacts violently with water; iii) forms potentially explosive mixtures with water; iv) when mixed with water, generates toxic gases, vapours or fumes in a quantity sufficient to present danger to human health or the environment; v) is a cyanide or sulphide bearing waste which, when exposed to pH conditions between 2 and 12.5 can generate toxic gases, vapours or fumes in a quantity sufficient to present danger to human health or the environment; vi) is capable of detonation or explosive reaction if it is subjected to a strong initiating source or if heated under confinement; vii) is readily capable of detonation or explosive decomposition or reaction at standard temperature and pressure; or viii) is an explosive (Class 1) as defined in the Explosives Regulations, C.R.C., c. 599, as
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amended from time to time. mm. "Service" means water supply and water service and/or wastewater collection and wastewater service and/or stormwater collection and stormwater service or any combination each of them; nn. "Solvent Extractable Matter" includes grease or oils from animal, vegetable, mineral or synthetic sources; oo. Spill means an uncontrolled discharge into the wastewater or stormwater system. pp. "Standard Methods" means standard methods for the examination of water and wastewater by the utilization of analytical and examination procedures provided in the edition current at the time of testing, published jointly from time to time by the American Public Health Association and the American Water Works Association and includes any publication by or under the authority of the Canadian Standards Association for the testing of water and waterworks to determine water quality standards; qq. "Stormwater" means water from precipitation of all kinds, and includes water from the melting of snow and ice, groundwater discharge and surface water; rr. "Stormwater Building Service Connection" means a piping system that conveys stormwater from a property to a stormwater system; ss. "Stormwater System" means a system carrying stormwater owned by the Commission; tt. "Suspended Solids" means the insoluble matter suspended in wastewater or stormwater that is separable by laboratory filtration; uu. "Total Kjeldahl Nitrogen" means organic nitrogen; vv. "Total PAHs" means the total of all of the following polycyclic aromatic hydrocarbons: Acenaphthene, acenaphthylene, anthracene, benza(a)anthracene, benzo(a)pyrene, benzo(b)fluoranthene, benzo(g,h,i)perylene, benzo(k)fluoranthene, chrysenes, dibenzo(a,h)anthracene, fluoranthene, fluorene, indeno(1,2,3-cd)pyrene, methylnaphthanlene, naphthalene, phenanthrene, pyrene; ww. "Toxic Substance" means any substance defined as toxic under the Canadian Environmental Protection Act 1999, as amended from time to time xx. "Uncontaminated Water" means potable water or any other water to which no matter has been added as a consequence of its use; yy. "Waste" means a substance that would cause or tend to cause an adverse effect if added to the environment, wastewater facilities or stormwater systems and includes rubbish, slimes, tailings, or other industrial wastes, effluent, sludge, sewage, garbage, refuse, scrap, litter or other waste products of any kind; zz. "Waste Radioactive Substances" includes uranium, thorium, plutonium, neptunium, deuterium, their respective derivatives and compounds and such other substances as the Atomic Energy Control Board (Canada) may designate from time to time as being capable
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of releasing ionizing radiation; aaa. "Wastewater" means liquid waste containing animal, vegetable, mineral or chemical matter as well as water from sanitary appliances that contains human fecal matter or human urine in solution or suspension together with such groundwater, surface water or stormwater as may be present; bbb. "Wastewater Building Service Connection" means a piping system that conveys sewage or wastewater from a property to a wastewater system; ccc. "Wastewater Facilities" means the structures, pipes, devices, equipment, processes and related equipment used, or intended to be used, for the collection, transportation, pumping or treatment of sewage or wastewater and disposal of effluent;
ddd. "Water Building Service Connection" means a piping system that conveys water from a water main to a property; eee. "Watercourse" means: i. the bed and shore of every river, stream, lake, creek, pond, spring, lagoon or other natural body of water, and the water therein, within the jurisdiction of the Province, whether it contains water or not and, all ground water.
ii.
4 (1) These regulations shall be interpreted in accordance with the principles for the interpretation of legislation. (2) The Interpretation Act (Nova Scotia) applies to these regulations, except where a contrary intention appears.
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PART II RATES
Rates for Water Service 5(1) Bills for water service, other than for a specific one time service, shall be issued on a monthly or quarterly basis and shall be comprised of a base rate and a consumption rate, each applicable as follows; i. Table 1. Base Rate for Water Service on or after July 1, 2013
Size of Meter (mm)
15 20 25 40 50 80 100 150 200 250
Minimum Water Monthly Bill

$6.74 $8.84 $13.06 $23.60 $36.25 $69.97 $107.92 $213.31 $381.95 $634.90
Minimum Water Quarterly Bill

$20.22 $26.52 $39.18 $70.80 $108.75 $209.91 $323.76 $639.93 $1,145.85 $1,904.70
Base Rate for Water Service on or after April 1, 2014

Size of Meter (mm)
15 20 25 40 50 80 100 150 200 250
Minimum Water Monthly Bill

$7.22 $9.47 $13.96 $25.20 $38.68 $74.64 $115.09 $227.45 $407.24 $676.91
Minimum Water Quarterly Bill

$21.66 $28.41 $41.88 $75.60 $116.04 $223.92 $345.27 $682.35 $1,221.72 $2,030.73
ii.
Consumption Rate
The consumption rate for water is: $0.902 / m for water sold on or after July 1, 2013, and $1.012 / m for water sold on or after April 1, 2014. (2) Non-metered customers will be charged the approved base water rate and the consumption rate for an equivalent size meter, as estimated by the Commission based on the best information available to the Commission.
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Table 2. Non-metered Service Rates Service on or after July 1, 2013:

Monthly Bill (15 mm) 179 m /year (Domestic) (20 mm) 607 m/year (25 mm) 1,229 m/year $20.19 $54.47 $105.44 Quarterly Bill $60.57 $163.41 $316.32
Service on or after April 1, 2014:

Rates for Wastewater Service 6(1) Bills for wastewater service, other than those charges for a specific one time service shall be issued on a monthly or quarterly basis and shall be comprised of a base rate and a volumetric rate, each applicable follows; i. Table 3. Base Rate for Wastewater Service on or after July 1, 2013
Minimum WW Size of Meter (mm) 15 20 25 40 50 80 100 150 200 250 Monthly Bill $11.68 $14.47 $20.06 $34.03 $50.80 $95.51 $145.80 $285.51 $509.04 $844.34 Minimum WW Quarterly Bill $35.04 $43.41 $60.18 $102.09 $152.40 $286.53 $437.40 $856.53 $1,527.12 $2,533.02
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Base Rate for Wastewater Service on or after April 1, 2014
Minimum WW Size of Meter (mm) 15 20 25 40 50 80 100 150 200 250 Monthly Bill $13.74 $16.96 $23.40 $39.52 $58.86 $110.42 $168.44 $329.58 $587.41 $974.16
Minimum WW Quarterly Bill $41.22 $50.88 $70.20 $118.56 $176.58 $331.26 $505.32 $988.74 $1,762.23 $2,922.48
ii.
Wastewater Discharge Rate
The discharge rate for all wastewater discharged to the wastewater system is: $1.400 / m for wastewater discharged on or after July 1, 2013, and $1.726 / m for wastewater discharged on or after April 1, 2014. (2) Non-metered customers will be charged the approved wastewater base charge and the consumption discharge rate for an equivalent size meter, as determined by the Commission and based on the projected usage of the customer, as estimated by the Commission based on the best information available to the Commission, including comparison with other similar customers and/or the use of private meters. Table 4. Non-metered Service Rates Service on or after July 1, 2013:
Service on or after April 1, 2014:

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Rates for Stormwater Service 7(1) Bills for stormwater and service, other than those charges for a specific one time service, shall be issued on a semi-annual or annual basis and shall be comprised of a two part charge consisting of a street right-of-way charge and a site generated charge based on the impervious area of a site, as set out below. Public Right of Way (ROW) Flow Rate: $0.171 / m2 of impervious area on or after July 1, 2013, and $0.186 / m2 of impervious area on or after April 1, 2014. Site Generated Flow Rate: $0.115 / m2 of impervious area on or after July 1, 2013, and $0.129 / m2 of impervious area on or after April 1, 2014. Impervious area will be measured through satellite imagery. (2) Residential customers shall pay a uniform charge of $53.20 for 2013/14 pro-rated to begin effective July 1, 2013 together with a uniform charge of $58.67 in 2014/15, which uniform charge shall be based on average impervious area for residential properties, as calculated from satellite imagery. (3) Properties that are within HRWCs service area that do not receive stormwater service from HRWC will be exempt from the Site-Generated Flow portion of the charge.
Charge for Temporary Water, Wastewater or Stormwater Service 8(1) The Commission may furnish water, wastewater and/or stormwater service to customers requiring temporary service for construction of buildings or other work. (2) Persons referred to in subsection (1) who require water service shall deposit with the Commission such sum as may be determined by the Commission as being sufficient to defray the cost of making the necessary connection to the services provided, together with the cost of the meter to be installed to measure the water consumed. (3) Upon completion of the work referred to in subsection (2) and the return to the Commission of the undamaged meter, the Commission may refund the deposit referred to in subsection (2) after payment for the services provided and the Commissions determination of connection or disconnection charges calculated based on the time and materials used in providing the service, together with the meter base charge and the consumption and/or discharge rates in respect of such service installation. (4) The Commission may approve the temporary discharge of wastewater or stormwater to wastewater facilities or stormwater systems, upon such terms and conditions as the Commission determines appropriate in the circumstances, such temporary discharges to be subject to the discharge rate approved by these regulations. (5) Costs incurred by the Commission to sample, analyse, monitor or inspect a temporary discharge may be charged to and recovered from the person to whom permission to discharge has been given.
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New Water, Wastewater or Stormwater Account Charge 9. The Commission shall charge $25.00 for the creation of a water, wastewater, and/or stormwater account.
PART III BILLING Payment of Bills 10(1) Bills for service issued by the Commission to customers shall be payable on the date indicated thereon and will provide as follows: a) Bills issued on a quarterly basis and which are not paid within 30 days after the billing date shall be subject to an interest charge of 1.5% per month or part thereof, or a maximum of 19.56% per annum, such amount being due and payable within the 30 day period, the effective date of the interest charge shall be clearly shown on the bill. b) Bills issued on a monthly basis and which are not paid within 25 days after the billing date shall be subject to an interest charge of 1.5% per month or part thereof, or a maximum of 19.56% per annum, such amount being due and payable within the 25 day period, the effective date of the interest charge shall be clearly shown on the bill. c) Bills for stormwater service to customers who are not receiving water or wastewater service may be issued annually and if not paid within 30 days after the billing date shall be subject to an interest charge of 1.5% per month or part thereof, or a maximum of 19.56% per annum, such amount due within such 30 day period and the effective date of the interest charge shall be clearly shown on the bill. (2) Despite subsection (1) customers who receive stormwater service only shall receive bills for stormwater service by application of such charges to their property tax invoice issued by the Halifax Regional Municipality.
Adjustment of Bills 11(1) Any customer desiring to question their bill shall do so in writing within one year from the billing date shown on such bill. (2) In the event the Commission determines it is necessary to make a billing adjustment as a result of a customer being under-billed, such adjustment shall be retroactive for a maximum of four billing periods or one year, whichever is longer. (3) Despite subsection (2), in the event that a billing adjustment is the result of the customers unauthorized connection to the water, wastewater or stormwater system or willful interference with or damage to metering equipment, the billing adjustment in such circumstances will not be limited to one year or four billing periods but, rather, the customer shall be responsible for all payments of such accounts from the date such unauthorized connection to water service or
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interference with meter equipment occurred. (4) In the event the Commission determines it is necessary to make a billing adjustment as a result of a customer being over-billed, such adjustment will be estimated by the Commission, and, based upon such estimate, the Commission will pay to such customer the overbilled amount together with interest calculated as simple interest paid on savings accounts by deposit taking banks listed in Schedule I of the Bank Act (Canada), during the period which the customer was over-billed by the Commission, such period not to exceed two years. (5) If a water meter security seal is broken or if a meter does not register correctly or in the absence or removal of the meter, the charge for water, and or wastewater service shall be estimated in accordance with the best data available to the Commission, provided that if the subject premises is unmetered or a non-user of the water system, then the charge for service will be estimated in accordance with the best available data to the Commission.
Estimated Reading for Billing Customers 12(1) The Commission may estimate a meter reading provided that under no circumstances will an estimated reading be used for more than three consecutive billing periods. (2) In the event an estimated bill is utilized by the Commission for three consecutive billing periods, the Commission shall make every reasonable effort to obtain a meter reading. (3) For the purposes of subsection (2), if entry to the property on which such meter is located is required, the Commission shall notify the customer by first class mail and undertake its reasonable efforts to obtain a reading, and failing such arrangements being made despite its reasonable efforts, the Commission may suspend service until arrangements are made with the customer for the Commission to obtain a reading of such meter. (4) When a meter reading referred to in subsection (3) has been obtained, any previously estimated bill or bills provided in respect of service measured by such meter shall be adjusted by the Commission if required by its reconciliation of metered service data to previously estimated service.
Suspension or Refusal of Service 13(1) The Commission shall have the right to suspend service to a customer whose bill remains unpaid for more than 40 days (2) With respect to water, wastewater and stormwater accounts, unpaid balances will be transferred to the Regional Municipality with a request that they be registered as a lien against the property. (3) In the event of a violation these Regulations by a person or customer, including liabilities and obligations owed to the Commission by any customer under a private contract for services entered into between the Commission and such customer, the Commission may refuse or immediately suspend service to the premises where the violation has occurred or is existing, and may continue such refusal or suspension until the violation has been cured.
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Collection of Overdue Bills 14. The Commission may charge a $35.00 fee for each visit by Commission staff to a customer whose payment is overdue, if in the opinion of the Commission, such fee is warranted.
Customer Bill Retrievals / Copies 15. The Commission shall charge a fee of $12.00 per copy for water, wastewater, and/or stormwater bill retrievals or copies issued to customers outside the regular billing cycle.
Dishonoured Payments 16. The Commission shall charge a $25.00 fee plus bank charges for cheques or pre-authorized payments that have been dishonoured by the customers bank or other financial institution.
Deposits 17(1) The Commission may require an applicant for water, wastewater and/or stormwater service to deposit with the Commission a sum equal to the estimated charges for six months of service, which deposit shall be held by the Commission as security for the payment of the applicants bills as a customer of the Commission. (2)When a customer referred to in subsection (1) ceases to be a customer, a deposit paid in accordance with subsection (1) shall be returned to the customer with interest thereon at the current simple interest rate then being paid on savings accounts by the Commissions chartered bank.
PART IV - CHARGES
Connection/Disconnection of Service 18(1) The Commission shall charge $55.00 for a connection or disconnection of service during regular working hours, which charge shall be $210.00 for a connection or disconnection of service outside regular working hours, regular working hours being, for the purpose of this subsection, between the hours of 8:30 in the morning and 4:30 in the afternoon on any day which is not a Saturday, a Sunday or a holiday, as that term is defined in the Interpretation Act. (2) When water, wastewater, or stormwater service has been suspended for any violation of these regulations, such service shall not be re-established until a reconnection charge of $55.00 has been paid by the customer. (3) Despite subsections 2 and 3, the fees set our therein do not apply in respect of a first incident of suspension for non-payment, disconnection or reconnection of service.
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Water Meter Installation 19(1) The Commission shall charge $55.00 for the installation of a new meter in a customers premises during regular working hours for a meter size up to and including 25 mm, in a meter setting specified by the Commission and provided by the Customer. (2) Installation of a meter referred to in subsection (1) which takes place outside of regular working hours shall be subject to a charge of $210.00. (3) In respect of the installation by the Commission of meters of a meter size of 40 mm or larger in a customer's premises in a meter setting specified by the Commission and provided by the Customer, such charge shall be calculated based on the Commissions determination of any difficulties of challenges it encountered in carrying out such installation including access to the meters location.
Customer Monitoring Service 20(1) The Commission may enter into an agreement with a customer to monitor the metered flow of service to the customer and to provide the customer access the data generated by such monitoring. (2) The cost of providing this monitoring referred to in subsection (1) will be charged to the customer at the rate of $120.00 per month, per meter and billed to the customer monthly.
Inspection of Building Service Connections 21. The Commission shall require all water, wastewater and stormwater building service connections to be inspected by the Commission prior to activation of such water, wastewater and/or stormwater service, subject to the following fees: a) for water connections up to and including 50 mm in diameter the fee shall be $90.00 per inspection visit, and $165.00 for water connections greater than 50 mm in diameter. b) for wastewater and/or stormwater connections up to 150 mm in diameter the fee shall be $90.00 per inspection visit, and $165.00 for connections 150 mm or greater in diameter. c) If multiple service connections are inspected within the same visit, only one fee shall apply and it shall be the higher of the multiple fees.
Rebate 22(1) Where a customer can demonstrate to the satisfaction of the Commission that the volume of sewage or wastewater discharged by the customer into the Commissions wastewater facilities is less than half of the volume of water used by the customer, a rebate of the Wastewater Discharge Charge attributable to the difference between the amount of the water used and the amount of sewage or wastewater discharged to the Commissions wastewater facilities shall be paid to the customer.
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(2) The rebate referred to in subsection (1) does not apply to the Wastewater Discharge Base Charge nor to leakage or wastage from a metered water supply. (3) Application for a rebate under subsection (1) shall be made annually by the Customer to the Commission, together with such documentation as may be required by the Commission in support of such application for rebate. The application must be made no later than 6 months after the year in which the rebate is applied for.
Extra Strength Wastewater Surcharge 23(1) The Commission may grant approval to a user of a wastewater system to discharge extra strength wastewater into the Commissions wastewater system as set out in Section 69 of these regulations. (2) The approval referred to in subsection (1) shall include an extra strength surcharge that shall be established by the Commission in addition to an approved wastewater discharge rate as set out in Attachment 2 to these regulations, and shall be added to the monthly or quarterly wastewater bill of the customer, as the case may be. The Extra Strength Wastewater Surcharge rates are as follows: Effective July 1, 2013: BOD: $1.0608 per kg and Suspended Solids: $1.0207 per kg Effective April 1, 2014: BOD: $1.3045 per kg and Suspended Solids: $1.2474 per kg
Review of Drawings and Specifications 24. The Commission shall levy a charge pursuant to a services agreement with any person requesting a review of Final Design drawings and specifications for additions and or extensions to the Commissions system, at the following rates: i. Water Mains $1.20 per linear metre $1.20 per linear metre $1.20 per linear metre
ii. Wastewater Mains iii. Stormwater Mains/Ditches/Culverts
The charges are due upon receipt by the Commission of a signed Service Agreement by the applicant. The Commission will undertake audit inspections of the water, wastewater and stormwater systems including building service connections. The applicant shall pay 2% of the construction cost estimate for inspection fees. The applicant shall pay inspection fees to HRM as specified by the Subdivision By-Law if the extension of services is incorporated in a subdivision application.
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Missed Appointment by Customer 25. Where an appointment has been made with a customer respecting: a) a water, wastewater, and/or stormwater service connection made; b) a water meter installed; c) water turned on or off to a property; d) a service related visit requested by the Commission; e) a customers request to have the Commission visit a property, and the customer fails to keep or permit such appointment or the required plumbing is not completed to allow for the installation of a water meter, the Commission shall levy a charge of $45.00 for each missed appointment.
Theft of Service 26. The Commission may charge penalties in addition to charges for service approved by these regulations for each unauthorized water, wastewater, and/or stormwater service connection, as follows: 1st incident 2nd incident Designated Bulk Fill Station 27(1) The Commission may permit access to bulk fill water stations in accordance with the fees, consumption rates and access card use as follows, (a) Annual designated bulk fill station permit fee: An annual permit fee will be charged for each vehicle equipped for access to the bulk fill stations, as follows: i. ii. iii. First Card - $225.00 Additional Cards - $20.00 Replacement of Lost/Stolen Cards - $200.00 $300.00 $750.00
(b) Consumption Rates: i. Consumption rates for water accessed through the "urban core" bulk fill stations will be $1.77 per cubic metre effective July 1, 2013 and $1.97 effective April 1, 2014. Consumption rates for water accessed through the Middle Musquodoboit bulk fill station will be $2.00 per cubic metre.
ii.
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(c) Access Cards: i. ii. iii. Bulk water access cards will be pre-loaded in specific dollar amounts and will be recorded as deferred revenue. Bulk water access cards will be assigned to specific vehicles identified for access to the designated fill stations. Access cards may be returned by the authorized user and any outstanding balance will be refunded to such user.
(2) Consumption charges will be deducted from an access card balance based on the volume of water sold as per the rate structure authorized by these regulations. (3) Vehicles accessing a designated bulk fill station shall be inspected and approved by the Commission on an annual basis as part of its permitting process. (4) Designated bulk fill station procedures as prescribed by the Commission shall be adhered to at all times by authorized users as a condition of retaining such permit. (5) Failure to comply with the permitting requirements set out in this Section shall result in termination of a designated bulk fill station permit. (6) The Commission reserves the right to control flow rates at each designated fill station.
Area Master Capital Cost Contribution Charge 28(1) The Commission may establish a Water, Wastewater and Stormwater Capital Cost Contribution Charge to be collected from developers and/or future customers requiring extension of oversized infrastructure. (2) The total amount of a Capital Cost Contribution Charge shall ensure that the cost impact to the Commission is neutral to the design, construction, financing and applicable overhead costs, as prescribed by the Commission. (3) The Water, Wastewater and Stormwater Capital Cost Contribution Charge shall be calculated for charge areas referred to in Attachment 3 and allocated on the basis of the Water, Wastewater and Stormwater Capital Cost Contribution Formula, as set out in Attachment 3. (4) Funds collected under the Water, Wastewater and Stormwater Capital Cost Contribution Charge shall be placed in a reserve account and will be used for extension or improvements of the applicable system within the area related to the charge upon application and subject to the approval of the Board. (5) The Commission may require a Capital Cost Contribution from developers and/or future users requiring extension or improvements of the water, wastewater and/or stormwater system, the total amount of such Capital Cost Contribution having a cost impact to the Commission which is neutral to the design, construction, financing and applicable overhead as prescribed by the Commission.
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(6) Cost factors to be used in calculating the Capital Cost Contribution in subsection (5) shall include, but not be limited to the supply, storage, transmission, distribution, pressure control and fire protection requirements as required by the Commission from time to time. (7) The Commission will allocate capital costs in accordance with the Rates and Charges approved by these regulations.
Sewer Redevelopment and Trunk Sewer 29(1)There shall be paid as hereinafter required a) a sewer redevelopment charge of $0.30 per square foot of floor space shall apply in respect of all newly constructed buildings, all buildings which are moved to a new location and all additions to buildings in locations which receive service.; and b) A trunk sewer charge of i) $500.00 per unit in respect of a dwelling unit: and
ii) $0.30 per square foot in respect of floor space of every building which is not a dwelling unit. (2) A building in respect of which an addition has been constructed pursuant to the terms of such permits as are required for construction, and which building has previously paid a trunk sewer charge, shall be subject to the sewer redevelopment charge levied pursuant to this Section only in respect of such constructed addition; (3) A building which, by the nature of its use, may reasonably be considered an outbuilding or accessory building, shall be subject to the sewer redevelopment charge levied pursuant to this Section if it contains facilities which can discharge to a wastewater facility; (4) The sewer redevoplment and trunk sewer charge levied pursuant to this Section shall be paid to HRM as agent for the Commission a) prior to the issuance of a building permit in the case of the sewer redevelopment charge; and b) at the time the land on which the dwelling unit or other building is situate receiving service in the case of the trunk sewer charge; and upon collection, shall be placed in a separate reserve account and, subject to the approval of the Board, used for upgrading or oversizing trunk sewers; and (5) The sewer redevelopment charge levied pursuant to this Section shall not apply in respect of buildings or additions to buildings located on land that has previously been subject to an infrastructure charge respecting all, or part of, a new, or expansion of, a wastewater facility orstormwater system.
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Capital Cost Charge for Wastewater Treatment Facilities 30(1) There shall be paid as hereinafter required, a charge a) in the amount of $877.00 in respect of a newly constructed single detached dwelling unit to be connected to a wastewater system; b) in the amount of $584.00 in respect of each unit in a newly constructed multiple unit residential building containing more than one unit and which is to be connected to a wastewater system; and c) at the rate of $0.27 per square foot of floor space in respect of all buildings other than those described in (a) and (b), including constructed additions thereto, located in areas in which service is available which shall be paid to HRM as agent for the Commission prior to the issuance of a building permit. (2) A building which, by the nature of its use, may reasonably be considered an out building or accessory building in relation to a building described in clauses (1) (a) and (b) hereof shall be subject to the charges levied therein if such out building or accessory building contains facilities which can discharge to a wastewater facility; (3) Where a lot of land on which a building is located was not in receipt of service prior to the coming into force of this Section the charges levied pursuant to this Section shall be payable when such building is connected to a wastewater facility; (4) The charges levied pursuant to this Section shall be paid to HRM as agent for the Commission prior to the issuance of a building permit and, opon collection, shall be placed in a separate reserve account and, subject to the approval of the Board, used for increasing capacity, as required, in wastewater facilities.
Recovery of Costs 31. The Commission may recover from a person who has violated these regulations its costs incurred as a result of any such violation.
PART V - FIRE PROTECTION CHARGES
Public Fire Service Charge 32. The Commission shall annually render to Halifax Regional Municipality not later than the last day of August, an invoice for fire protection service calculated in accordance with these regulations.
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Public Fire Protection Rate 33. Effective July 1, 2013 the Halifax Regional Municipality shall pay, annually, to the Commission for public fire protection services, the sum of $4,538,186 which shall be pro-rated for 2013/14. April to June 2013 will be based on 3/12 of the 2012/13 amount of $9,947,644. July 2013 to March 2014 will be 9/12 of $4,538,186. Effective April 1, 2014 the Halifax Regional Municipality shall pay, annually, to the Commission for public fire protection services, the sum of $4,901,781.
Special Service Supplied from Fire Hydrants 34(1) Water supplied from fire hydrants is reserved for firefighting or for Commission water, wastewater or stormwater system maintenance purposes. (2) Any person, other than the Halifax Regional Fire and Emergency service or the Commission, who desires to use a fire hydrant for the supply of water, shall obtain prior written approval from the Commission. (3) The Commission may furnish water from a fire hydrant to persons requiring temporary supply pursuant to Section 7 of these regulations. (4) Any connection to a fire hydrant other than in accordance with this section shall constitute an offence against these regulations.
Building Fire Protection Systems 35(1) A customer, in respect of each of its buildings having a fire protection system installed, shall pay annually to the Commission fees for such service as follows: Table 7. Charges for Sprinklers 2013/14
Description Reference size Fire Lines Fire Lines Fire Lines Public Hydrants Private Hydrants Fire Lines Fire Lines Fire Lines Fire Lines Diameter mm 25 50 75 100 150 150 150 200 250 300 Ratio of Area to Reference Size 1.0 4.0 9.0 16.0 36.0 36.0 36.0 64.0 100.0 144.0 Annual Charge $16 $62 $141 $250 $562 $562 $562 $999 $1,562 $2,249
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Charges for Sprinklers 2014/15:

Description Reference size Fire Lines Fire Lines Fire Lines Private Hydrants Fire Lines Fire Lines Fire Lines Fire Lines Diameter mm 25 50 75 100 150 150 200 250 300 Ratio of Area to Reference Size 1.0 4.0 9.0 16.0 36.0 36.0 64.0 100.0 144.0 Annual Charge $17 $67 $152 $270 $607 $607 $1,079 $1,687 $2,429
(2) A customer shall be responsible for the cost of installing a private fire line from the street water main to the building, including a shut-off valve approved by the Commission. (3) The Commission may install the private fire line referred to in subsection (2) or it may approve the installation such sprinkler line installed by or for the customer. (4) The portion of a private fire line that extends from the water main to the street boundary line of a property shall become the property of the Commission and the Commissions portion of such line shall be maintained by the Commission. (5) Discharge of water from fire protection systems for maintenance purposes shall be in accordance with these regulations.
PART VI PROVISION OF SERVICE Liability for Payment of Service 36(1) Any person who applies to the Commission for water or wastewater service is deemed to agree to take and pay for such service according to the rates and charges approved by these regulations. (2) Any person receiving stormwater service is deemed to agree to take and pay for such service according to rates and charges as approved by the regulations. (3) Any person who receives water or wastewater service whether metered or unmetered, without the consent of the Commission, shall be liable for the cost of such service as determined in the sole discretion of the Commission based upon its reasonable estimate of the amount of
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service utilized. (4) Where service is supplied to a condominium unit, the condominium corporation in which the unit is situated shall be deemed to be the customer of record and shall be liable for payment of service to the condominium unit.
Plumbing to be Satisfactory 37(1) All plumbing, pipes, fittings, vents, fixtures, and other devices used by a customer in receiving service from the Commission but which are not the property of the Commission, shall be installed in a manner provided by the Building Code Act (Nova Scotia) and Regulations made thereunder and be approved by a person appointed as a building inspector under By-law B-201 of the Regional Municipality respecting the Building Code, including its successor, and as amended from time to time. (2) Service shall not be provided (except for construction and testing purposes) until an applicant for service has complied with the requirements set out in subsection (1). (3) Water service may be discontinued at any time, if in the opinion of the Commission, a person has not complied with the requirements of subsection (1). (4) Water service may be discontinued at any time if, in the opinion of the Commission the water meter is in a, dirty, unsanitary or inaccessible place.
Prohibited Appliances 38(1) Water service may be refused or suspended by the Commission to a customer who installs or uses any device or appurtenance which may cause sudden large demands of any duration or affect the stability of regulation of water pressure in the Commissions system, including booster pumps, quick opening or quick closing valves, water operated pumps or siphons, stand pipes, private fire hydrants or large outlets for supplying ships. (2) Permission to install or use any device or appurtenance prohibited in subsection (1) shall be obtained from the Commission. Improper Use of Water, Wastewater, and/or Stormwater 39. No customer shall permit the improper use of water, wastewater, and/or stormwater, nor sell or give water to any person, except upon such conditions and for such purposes as may be approved in writing by the Commission.
Capacity of Wastewater and/or Stormwater Facilities 40. In the event the Commission deems that the wastewater and/or stormwater facilities, or any portion thereof, have insufficient capacity to accept existing or proposed wastewater and/or stormwater flows, the Commission may require that the amount of flow which can be discharged into the wastewater and/or stormwater facilities be limited according to such terms and conditions as the Commission may approve.
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Pipe Installation 41. The Commission shall not be required to install pipe in any short term or seasonal conditions which, in its opinion, are not suitable for such installations and under which the Commission cannot guarantee a free flow of water, wastewater and/or stormwater in service pipes. Unauthorized Extensions, Additions, or Connections 42. No person shall, without the prior written consent of the Commission, make or cause to be made any connection to any part of the water, wastewater and/or stormwater system, or in any way obtain or use the stormwater system in any manner other than as set out in these regulations.
Interference with Commission Water Services 43(1) No person shall, unless authorized by the Commission in writing: a) draw water from, open, close, cut, break, infill, alter or in any way injure or interfere with any fire hydrant, water main, service pipe, or property of the Commission; b) obstruct the free access to any hydrant, valve, service box, meter, or property of the Commission. (2) Nothing in this Section shall be deemed to prevent an officer or member of the Halifax Regional Fire and Emergency engaged in discharge of its duties and responsibilities, from using any hydrant or other source of water supply of the Commission for such purpose.
Interference with Commission Wastewater and/or Stormwater Services 44. No person shall, unless authorized by the Commission in writing: a) discharge wastewater and/or stormwater into wastewater facilities and/or stormwater system; b) open, cut, break into, or in any way injure or interfere with any part of any wastewater facility and/or stormwater system, or any property of the Commission; c) obstruct the free access by the Commission to any portion of the wastewater facilities or stormwater system.
PART VII METERING
Water to be Supplied Only by Meter
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45(1) All water service shall be metered, except as otherwise provided in these regulations. (2) The Commission shall approve the size and type of meter to be installed for water service, which meters remain the property of the Commission while metering such service. (3) Where a customer chooses to sub-meter to allocate costs, such sub-meter shall be installed downstream of the Commissions meter. (4) Sub-meters referred to in subsection (3) shall be considered by the Commission to be owned, installed, read and maintained by the customer at the customers expense. (5) Despite subsections (3) and (4), data provided by the Commissions meter shall be used to prepare billings for service. (6) A customer shall not sell unmetered water to any person without the prior written approval of the Commission.
Installation and Removal of Water Meters 46(1) All meters, outside register devices, and radio frequency units, shall be installed, maintained and removed with the approval of and under the supervision of the Commission. (2) No person shall install, alter, change or remove a meter without the prior written permission of the Commission. (3) Each metered service shall have a stop device located at the property line or outside the building foundation wall in respect of which service is provided, as determined by the Commission, to permit control of the service. (4) Each service line shall be metered individually. (5) A service connection to a meter shall be installed with a shut-off valve on both sides of the meter, inside the building, to the satisfaction of and without expense to the Commission, and as prescribed by the Commission. Location of Water Meters 47(1) The Commission shall have the right to refuse water service to, or suspend the water service of any customer who does not provide a place, which in the opinion of the Commission, is suitable for a meter, and a related reading device located on the exterior of the building to which service is provided. (2) A meter shall be located in the building to which water service is provided in close proximity to the point of entry into such building of the service pipe, in a location where it can be easily read, and replaced, and where it will not be exposed to temperatures below the freezing point of water. (3) A meter reading device located on the exterior of a building to which water service is provided shall be located where it can be easily read and replaced.
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(4) In the event of an alteration or renovation to a building to which water service is provided, the customer shall be responsible, as required by the Commission, to relocate the meter, including, as may be required by the Commission, a meter reading device located on the exterior of such building, at the customers expense and to a location approved by the Commission. (5) Where the premises of a customer are of such a nature that a meter cannot be adequately installed in a building or if the building is not sufficiently resistant to the effects of frost to maintain the proper and accurate functioning of the meter, the Commission may order the customer to provide a reasonably frost resistant insulated receptacle in which the meter can be placed for its safe and accurate functioning. (6) Until a customer complies with the requirements set out in subsection (5) the Commission may refuse or suspend water service to the premises. (7) In order for a customer to comply with the requirements set out in subsection (5), the Commission may require such customer to have installed at the customers expense a by-pass around a meter which is 50 mm or larger in diameter.
Master Water Meters 48(1) In circumstances where a customer or customers is provided service by the Commission with multiple water meters, the Commission may supply, at its expense, a master meter and install such master meter in a location and in a manner approved by the Commission on the customers premises. (2) A customer shall be liable to pay for the water which passes through the meter measuring service to such customer, provided, however, that if the amount of the aggregate of the amounts of water passing through the meters of individual customers is less than the amount of water passing through the master meter associated with the meters of such individual customers, the difference in cost of service obtained by subtracting the cost of metered water service measured by the master meter from the collective cost of metered water service measured by the meters of individual customers shall be divided equally among the such individual customers. (3) The Commission may suspend water service without notice to those individual customers referred to in subsection (2) who fail to pay their respective portion of the difference in cost of water service described therein between the master meter and collective individual meters. (4) Customers receiving water service where there is a master meter providing service as described in subsection (1) shall be jointly and severally liable for all water passing through such master meter and for the minimum charges therefore as provided herein. (5) The customer, or group of individual customers referred to in this section, as the case may be, shall be responsible for the distribution of water from the Commissions master meter to the properties of a customer or customers, and the Commission shall be under no obligation to install, maintain or replace any pipes, appliances, fixtures, or other apparatus connected therewith.
Damage to Water Meters
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49(1) A customer shall be responsible for the condition of the water meter installed on the service pipe through which service is provided to the customers premises and shall take reasonable measures to protect the condition of such water meter. (2) A customer shall be liable for any damage to a water meter, and related equipment, providing service to the customers premises, including damage resulting from carelessness, hot water, steam, or the action of frost. (3) Costs incurred by the Commission resulting from damage to a water meter and related equipment providing service to the customers premises shall be paid by the customer. (4) After tendering a bill to a customer for costs referred to in subsection (3), and such bill remains unpaid after 30 days, the Commission may suspend water service to such customer.
Meter Testing
50(1) Subject to subsection (2), upon receiving a request from a customer to have the customers meter tested (meter sizes 15 mm to 25 mm) the Commission may charge the sum of $50.00 to defray in part the cost of conducting the test. (2) If the test referred to in subsection (1) indicates that: a) for positive displacement meters (disc type) the meter is over-registering by more than 1.5 %, or b) for turbine or compound meters the meter is over-registering by more than 3%, the sum charged to the customer under subsection (1) shall be refunded to the customer and the bill for service rendered to the customer shall be adjusted accordingly, provided that no volumetric adjustment shall be made for a period beyond one year prior to the test and one refund shall be made only to the customer who, based on such test results overpaid for service. (3) For meters of 40 mm and larger which require on-site testing, the Commission shall levy a fee to cover the expenses in contracting a third party to conduct testing. (4) The amount referred to in subsection (3) shall be billed to the customer if the testing conducted confirms to the satisfaction of the Commission that the meter was providing accurate readings prior to the customers request that the meter be tested.
PART VIII WATER SERVICE
Water Building Service Connection 51. Upon receipt of an application for water service to any premises fronting on a public street, where there exists adjacent to such section of the public street a Commission owned and active water main and such premises are not already provided with water service, the Commission shall
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allow the installation of a building service connection which it considers to be of suitable size to provide the service required, provided that a) no water service smaller than 20 mm in diameter shall be installed; b) the necessary excavation for the laying of the service connection, backfilling, and replacement of the street and sidewalk surfaces from the water main in the street to the premises, including the supply and laying of the service connection and fittings to the specifications of the Commission, shall be the responsibility of the applicant for water service and all such work shall be performed without cost to the Commission; c) such excavation may be the same excavation as is used for the building service connection or if minimum horizontal and vertical separation between water and building service connections cannot be obtained, a separate excavation for the water service connection shall be required, provided, however, that in either case, the excavation shall be provided by the applicant to the satisfaction of the Commission. d) should any person make application for more than one service connection to a premises, the decision respecting the necessity of the additional service pipe shall be made by the Commission; e) all building service connections shall be installed in accordance with the Building Code Act and Regulations and to the satisfaction of the Commission; f) when a service connection has been installed without objection from the customer as to its location, no subsequent removal of or alteration to the position of the service connection shall be made except at the expense of the customer requesting such removal or alteration; g) each water service is to be individually metered; h) in the event of a change of the use of such premises, by way of rezoning, re-subdivision, condominium conversion or otherwise, where such use would result in an increased occupancy of the premises, the owner of such premises shall apply to the Commission for a determination as to whether the existing service connection(s) is/are of a suitable size to provide the increased demand required, pursuant to which application: i. the applicant may be required to provide a hydraulic analysis of the proposed water use and existing system to determine the suitability of the service for the new use, subject to the Commission, in its sole discretion, determining whether the existing service connection(s) is/are not suitable;
ii. all such service connections shall be installed at the owners expense, from the main line in the public street or right of way to the applicants premises, such installation to be in accordance with the Building Code Act and Regulations and to the satisfaction of the Commission; iii. the Commission may require the owner of a property to cap abandoned service connections at the water main where the applicants property intersects with the public street or right of way.
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Water Service Cross Connection Control & Backflow Prevention 52(1) In the event of any breach, contravention or non-compliance by a person of any of the provision and regulations in subsections (2), (3), (4) or (5), the Commission may: i. ii. suspend water service to such person, or give notice to the person to correct the breach, contravention or non-compliance within 96 hours, or a specified lesser period, provided that, if such person fails to comply with such notice, the Commission may immediately suspend water service to such person.
(2) No person shall connect, cause to be connected, or allow to remain connected to a water system, or a plumbing installation, without the prior written approval of the Commission, any piping fixtures, fittings container or sanitary appliance in a manner which may allow water, wastewater, or any other liquid, chemical or substance, to ingress or egress the water system. (3) Where, in the opinion of the Commission, there may exist a risk of contamination to the potable water system, notwithstanding the provisions of subsection (1), the Commission may require the customer, at the customers sole cost and expense, to install at any point on the customers water service connection or water service pipe, one or more backflow prevention (BFP) devices, which devices shall be of a quality and type approved by the Commission. (4) All BFP devices shall be maintained in good working order, inspected and tested by a certified tester, approved by the Commission, at the expense of the customer, and carried out annually or at such other intervals as the Commission may require. (5) A customer shall submit a report in a form approved by the Commission on all tests performed on a BFP device pursuant to subsection (4) within 30 days of a test, such report form to be displayed on or adjacent to the BFP device on which the tester shall record: i. ii. iii. the name and address of the owner of the device; the location, type, manufacturer, serial number, and size of the device; the test date, the testers initials, the testers name, the name of the testers employer, and the testers license number.
(6) The Commission shall maintain a program for the issuance, renewal and cancellation of Cross Connection Control Testers Licenses, which shall include minimum standards, insurance requirements, fees and administrative procedures. (7) Installation, maintenance, field-testing and selection of all BFP devices shall conform to the latest edition of CSA 864.10 and CSA B64 series.
Alternate Water Supply Prohibited 53. Connection of a customers water service installation to any other source of water supply is prohibited.
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Repairs to Water Building Service Connection 54. If a repair to a building service connection is required: a) it shall be repaired as soon as practicable at the Commissions expense if the repair is located between the main and the street line or the easement boundary and otherwise at the customers expense; b) despite clause (a) the Commission may make such repairs for any customer provided the customer agrees to pay the cost of repair and provided the customer requesting the Commission carry out such work deposits with the Commission a sum equal to the estimated cost of the work; and c) should a repair be required on the customers portion of the service connection, and the customer, after being notified, refuses or unreasonably delays to have repairs made, the Commission may, upon notice to the customer, discontinue the water service in order to prevent wastage of water or property damage.
Water Service Pressure Reducing Valves 55. Where, in the opinion of the Commission, a pressure reducing valve is required for proper service to a customer: a) the valve shall be installed on the service pipe between the meter and the shutoff valve on the supply side of the meter; b) the type of valve shall be satisfactory to the Commission; and c) the customer shall be responsible for the cost of purchasing, installing and maintaining the valve.
Water Service Control Valves 56. In respect of water service control valves; a) the service box and/or valve housing the premises control valve shall be exposed for access by the Commission personnel at all times. b) all control valve service boxes and/or valves shall be fully exposed and adjusted to final landscape grade before the installation of the premises water meter. c) any adjustment to the service box or valve box shall be the responsibility of the customer. d) the Commission may provide the service to adjust the service box or valve box and invoice the customer for all expenses incurred in providing such service. e) In the event that the service box is buried, paved over, back-filled or damaged as a result of carelessness, willful obstruction or any other like occurrence that, in the opinion of the Commission, results in the requirement of the Commission to expose, adjust or repair the
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service box and/or valve box, such activity of the Commission shall be at the customers expense. f) the Commission may undertake such activities as it deems necessary to gain access to the premises control valve (curb-stop) without expense to the Commission. g) In respect of actions undertaken by the Commission pursuant to clauses (e) and (f), reinstatement of the road, right-of-way, driveway, sidewalk, curb or landscape will, at the discretion of the Commission, be charged to and recovered from the customer.
Water Conservation Directives 57(1) The Commission may implement water conservation measures, if in the opinion of the Commission, such measures will permit the Commission to provide a reliable, continuous water supply to all customers serviced by the Commission. (2) During such times as water conservation measures referred to in subsection (1) are implemented, customers who do not comply with such measures may have their water service suspended during such period as the Commission's water conservation measures are in place. (3) The cost of turning on a water service suspended pursuant to subsection (2) will be the responsibility of the customer.
Acceptance of Private Community Water, Wastewater and Stormwater Systems 58. The acceptance of private community water, wastewater and stormwater systems by the Commission shall be in accordance with Attachment 1 to these Regulations, entitled Procedure for Acceptance of Private Community Water, Wastewater and Stormwater Systems.
PART IX - FIRE PROTECTION
Fire Protection Service Pipes 59(1) Upon receipt of an application, the Commission will permit an applicant to install a fire protection service pipe from the street main to the applicant's premises, subject to the applicant being responsible for all excavation, backfill, labour, material and street and sidewalk restoration costs related to a fire protection service pipe installation and subject to the Commission making the required connection to the street main at the applicant's cost. (2) If requested by an applicant, and subject to the applicant having applied for and received all required approvals, a metered service pipe may be connected to the fire protection service pipe
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outside the premises and with an approved shutoff valve. (3) The customer is responsible for the maintenance of the fire protection service pipe from the valve at the street main to the premises and the Commission is responsible for maintenance of the valve at the street main.
Private Fire Protection 60(1) Fire protection plumbing within buildings shall be installed in such manner that all pipes will be open and readily accessible for inspection at any time by authorities having jurisdiction in such matters, and no connection for any purpose other than fire protection shall be made thereto. (2) Unless approved by the Commission in writing, no fire protection charge line shall be connected in any manner to a metered service. (3) The customer is solely responsible for the maintenance, repair and replacement of all privately owned fire protection systems, including fire protection plumbing, valves, sprinklers, hydrants, and related appurtenances.
PART X - WASTEWATER AND/OR STORMWATER SERVICE
Wastewater and/or Stormwater Building Service Connections 61(1) Every wastewater and/or stormwater building service connection shall be designed and constructed at the expense of the customer served by the connection, whether on privately owned property or otherwise. (2) No person shall make a physical pipe connection to a wastewater facility or a stormwater system without the prior written approval of the Commission. (3) The Commission may require a wastewater or stormwater building service connection to be inspected and brought into compliance with the provisions of these regulations. (4) The Commission shall determine the necessity of having more than one wastewater and/or stormwater building service connection to a premise, upon application by any person requesting more than one such connection. (5) When the portion of a wastewater and/or stormwater building service connection located within a street right of way or easement has been installed without objection from a customer as to location of such connection, no subsequent removal or alteration of the location of such connection shall be made except at the expense of the customer requesting such removal or alteration. (6) In the event of a change of the use of premises, by way of rezoning, re-subdivision, condominium conversion or otherwise, where such use would result in an increased occupancy of the premises, the owner of such premises shall apply to the Commission for a determination as to whether the existing wastewater and/or stormwater building service connection or
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connections is or are, as the case may be, of a suitable size to provide the increased demand required on such building service connection or connections and, in respect of such application, i. the applicant may be required to provide a hydraulic analysis of the proposed wastewater and/or stormwater generation and existing downstream system capacity to determine the suitability of the service connection for a proposed new use;
ii. should the Commission determine that the existing wastewater and/or stormwater service connection or connections is or are, as the case may be, not suitable, the property owner shall comply with the requirements of the Commission with respect to its determination of the appropriate type and size of wastewater and/or stormwater service connection to be utilized; and iii. such wastewater and/or stormwater service connections shall be installed at the owner's expense and all installation shall be to the satisfaction of the Commission. (7) The Commission shall require the owner of a property, at its expense, to cap off abandoned wastewater and/or stormwater service connections at the main line as prescribed by the Commission. (8) The Commission may give notice in writing to an owner of a property serviced by wastewater or stormwater facilities requiring such owner, within the time specified in such notice, to connect to the wastewater or stormwater facilities through a building service connection. (9) The Commission may prohibit a person or customer from connecting sump pumps and/or downspouts to a stormwater building service connection or may require a person or a customer to disconnect sump pumps and/or downspouts from the stormwater building service connection if, in the opinion of the Commission, the stormwater system may be subject to capacity restrictions as a result of the connection of such sump pumps and downspouts.
Repairs to Wastewater and/or Stormwater Building Service Connections 62. In the event a wastewater and/or stormwater building service connection is obstructed, the following procedure shall be followed in removing the obstruction: a) At the customers expense, the customer shall be responsible for the initial investigation and clearing of the obstruction with the services of a licensed plumber to identify the cause and the location of the obstruction and take all necessary measures to remove the obstruction before requesting the Commission for assistance. b) If the obstruction is located in the portion of the service connection on private property, the customer shall be responsible for all the costs of removal of the obstruction, including the expenses of any contractor to excavate and replace the pipe if necessary and including obtaining any permits required by municipal by-laws and/or the Commission before commencing any excavation. c) If the obstruction is located in the portion of the service connection on municipal property, and a plumber is unable to remove it, the customer shall submit to the Commission a written report from a plumber and a video tape identifying the location and probable cause of the obstruction and on receipt of such report and video tape, the Commission shall
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investigate the obstruction and if it is determined by the Commission that the cause of the obstruction was: i. non-structural, the Commission shall advise the customer of its determination and the customer shall be responsible for clearing the obstruction, including replacing the pipe, if necessary; caused by a broken, sheared, sagged, or collapsed pipe or some other structural cause, the Commission will rectify the deficiency and reimburse the customer for the cost of plumbing and video services in an amount not exceeding $400.00, including HST; and caused by the roots from a municipally owned tree, the Commission will rectify and, on behalf of HRM, reimburse the customer for the cost of plumbing and video services in an amount not exceeding $400.00, including HST.
ii.
iii.
PART XI - WASTEWATER AND STORMWATER DISCHARGE
Discharge into Wastewater Facilities 63(1) No person shall discharge into a wastewater facility, sewage or wastewater which causes or may cause: i. ii. iii. a health or safety hazard; obstructions or restrictions to the flow in the wastewater facilities; an offensive odour to emanate from a wastewater facility, and without limiting the generality of the foregoing, sewage or wastewater containing hydrogen sulphide, mercaptans, carbon disulphide, other reduced sulphur compounds, amines, or ammonia in such quantity that may cause an offensive odour; damage to a wastewater facility ; interference with the operation and maintenance of a wastewater facility; a restriction of the beneficial use of biosolids from the Commission's wastewater facilities; effluent from the Commission's wastewater facilities to be in violation of any Provincial or Federal Acts or regulations; capacity or hydraulic impacts which may interfere with the operation of a wastewater facility.
iv. v. vi.
vii. viii.
(2) No person shall discharge into a wastewater facility, sewage or wastewater with any one or more of the following characteristics:
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i. ii. iii. iv.
a pH less than 5.5 or greater than 9.5; dissolved oxygen concentration of less than 2.0 mg/L, unless otherwise permitted by the Commission; two or more separate liquid layers; a temperature greater than 65 degrees Celsius.
(3) No person shall discharge, into a wastewater facility, sewage or wastewater containing one or more of the following: i. ii. iii. iv. combustible liquids; fuel; hauled sewage, hauled wastewater or leachate, except with the prior written approval of the Commission ; ignitable waste including but not limited to, flammable liquids, solids, and/or gases, capable of causing or contributing to an explosion or supporting combustion in wastewater facilities; detergents, surface-active agents or other substances that may cause excessive foaming in the wastewater facilities; sewage or wastewater containing dyes or colouring materials which pass through wastewater facilities and discolour the wastewater infrastructure or effluent; pathological waste in any quantity; material containing polychlorinated biphenyls (PCBs); pesticides; reactive materials; waste radioactive substances, including naturally occurring radioactive material (NORM), in excess of concentrations greater than those specified for release to the environment under the Nuclear Safety and Control Act and regulations made thereunder, each as amended from time to time; hazardous waste; extraneous water or wastewater from any source other than those listed in this subsection, without the prior written approval of the Commission; animal offal.
v. vi. vii. viii. ix. x. xi.
xii. xiii. xiv.
(4) Subject to Section 65, no person shall discharge into a wastewater facility, sewage or wastewater containing a concentration in excess of any of the limits set out in Table 8:
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Table 8: Limits for Discharge to Wastewater Facilities

Substance Aluminum, Total Antimony, Total Arsenic, Total Barium, Total Benzene Beryllium, Total Biochemical Oxygen Demand Bismuth, Total Cadmium, Total Chemical Oxygen Demand Chlorides Chloroform Chromium. Total Cobalt, Total Copper, Total Cyanide, Total 1,2 - Dichlorobenzene 1,4 - Dichlorobenzene cis - 1,2 - Dichloroethylene Trans - 1,3 - Dichloropropylene Ethylbenzene Fluoride Iron, Total Lead, Total Manganese, Total Mercury, Total Methylene chloride Molybdenum, Total Nickel, total Oil & Grease - mineral or synthetic in origin Oil & Grease - animal or vegetable in origin pH Phenolic Compounds (4AAP) Phosphorus, Total Selenium, Total Silver, Total Soluble Biological Oxygen Demand Sulphates Expressed as SO4 Suspended Solids, Total Sulphide (as H2S) 1,1,2,2 - Tetrachloroethane Tetrachloroethylene Milligrams Per Litre 50 5 1 5 0.01 5 300 5 0.7 600 1500 0.05 2 5 1 2 0.05 0.08 4.0 0.15 0.06 10 50 1 5 0.01 0.2 5 2 15 100 5.5-9.5 1 10 1 2 100 1500 300 1.0 0.5 0.5
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Tin, Total Titanium, Total Toluene Total Kjeldahl Nitrogen Trichloroethylene Vanadium, Total Xylenes, Total Zinc, Total
5 5 0.01 100 0.5 5 1.0 0.3
A reference to "Total" in this table denotes total concentrations of all forms of the metal and ion including both particulate and dissolved species.
(5) No person shall discharge into a wastewater facility sewage or wastewater for the purpose of dilution and for the purpose of achieving compliance with these regulations, without the prior written approval of the Commission. (6) No person shall discharge uncontaminated water into a wastewater facility without the prior written approval of the Commission.
Stormwater Discharge to Wastewater Facilities 64(1) The Commission may from time to time undertake testing or inspections to identify and locate connections that convey stormwater into a wastewater facility. (2) No person shall, without the prior written approval of the Commission connect, cause to be connected, or allow to remain connected to a wastewater facility or plumbing installation, any piping fixtures, sump pumps, downspouts, fittings appliances or like equipment or device in a manner which allows or may allow stormwater to ingress or flow into a wastewater facility. (3) The Commission may direct a person to discharge stormwater to a stormwater system, a surface area or watercourse. (4) Upon the Commission creating a new service account for a person, the Commission may require a Wastewater Building Service Connection to be inspected and brought into compliance with these regulations, at such persons expense. (5) The inspection required in subsection (4) shall include the discharge location of any roof or foundation drain or sump pump and such other inspection activities as will permit the Commission to determine whether a Wastewater Building Service Connection is in compliance with these regulations. (6) The Commission may determine, in its discretion, that this Section does not apply to existing premises currently connected to an existing combined sewer system or to new premises intended to be connected to a combined sewer system, provided that those premises are not serviced or able to be serviced by a separate stormwater system.
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Wastewater Service Extra Strength Discharge 65(1) The Commission may enter into a surcharge agreement with a customer who discharges extra strength sewage or wastewater into a wastewater facility and who is not in compliance with these regulations, respecting discharges of, a) biochemical oxygen demand; b) suspended solids, total. (2) A surcharge agreement referred to in subsection (1) may include terms and conditions under which the discharge will be permitted by the Commission and a method by which the Commission shall recover costs incurred by the pumping and treatment of the wastewater which is the subject of such surcharge agreement.
Discharge into the Stormwater System 66(1) No person shall discharge into a stormwater system, matter which causes or may cause, i. ii. iii. iv. v. vi. a health or safety hazard; interference with the operation of a stormwater system; obstruction or restriction of a stormwater system or the flow therein; damage to a stormwater system; impairment to the quality of the water in a stormwater system; or the quality of the water discharged from a stormwater system owned or operated by the Commission to be in violation of Provincial or Federal Acts or regulations.
(2) No person shall discharge into a stormwater system, matter which results in one or more of the following characteristics, i. ii. iii. iv. v. vi. visible sheen, film or discolouration; two or more separate layers; a pH less than 6.0 or greater than 9.5; dissolved oxygen concentration of less than 5.0 mg/L; a temperature greater than 40 degrees Celsius; or foam or any matter which, by itself or in combination with another substance, is capable of producing foam that will persist for 5 minutes or more.
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(3) No person shall discharge into a stormwater system, i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. hazardous waste chemicals; combustible liquids; floating debris; fuel; hauled sewage or hauled waste; pathological waste; PCB's; pesticides; reactive waste; toxic substances; waste radioactive substances, in excess of concentrations greater than those specified for release to the environment under the Nuclear Safety and Control Act and regulations made thereunder, each as amended from time to time; E. coli colonies in excess of 200 per 100 mL; water from sprinkler systems and non-contact cooling water; pool or spa water, or other source with a chlorine residual of 0.01mg/L; wastewater from washing equipment used in the mixing and delivery of concrete and cement based products; extraneous water or wastewater from any other source except as authorized in writing by the Commission; or animal offal.
xii. xiii. xiv. xv. xvi. xvii.
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(4) No person shall discharge into a stormwater system, matter containing a concentration, expressed in milligrams per litre, in excess of the limits set out in Table 9 as follows: Table 9. Limits for Discharge to Stormwater System
Substance Arsenic Benzene Biochemical Oxygen Demand Cadmium Carbon tetrachloride Chloroform Chromium Copper Cyanide Ethylbenzene Fluoride Lead Mercury Nickel (Total) Modified TPH pH Phenolics Phosphorus Selenium Silver Suspended Solids Thallium Toluene Trichloroethylene Xylene (Total) Zinc 1,2 -dichlorobenzene 1,4 dichlorobenzene Cis-1,2 dichloroethylene Trans- 1,3 dichloropropylene Methylene chloride 1,1,2,2 tetrachloroethane Tetrachloroethylene Di-n-butyl phthalate Bis (2-ethylhexyl) phthalate PAHs Milligrams per litre 0.02 0.002 15 0.008 0.02 0.002 0.02 0.03 0.02 0.002 1.5 0.05 0.0004 0.08 15 6.0-9.5 0.008 0.4 0.01 0.001 15 0.01 0.002 0.0076 0.0044 0.04 0.0056 0.0068 0.0056 0.0056 0.0052 0.017 0.0044 0.015 0.0088 0.002
A reference to "Total" in this table denotes total concentrations of all forms of the metal and ion including both particulate and dissolved species.
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(5) No person shall permit erosion or sediment runoff which exceeds any of the limits in Table 9 to enter a stormwater system (6) No person shall infill or alter a stormwater ditch unless authorized by the Commission in writing. (7) The Commission may direct and require a person or property owner who infilled or altered a stormwater ditch to remove the infill or remediate any alteration. (8) The cost of removal or remediation of ditch alterations not authorized by the Commission shall be the responsibility of the person or property owner.
Wastewater Discharges to Stormwater Systems 67(1) The Commission may, from time to time, undertake testing or inspections to identify and locate wastewater entering into a stormwater system. (2) No person or customer shall connect, cause to be connected, or allow to remain connected to the stormwater system or plumbing installation, without the express written consent of the Commission, any piping, fixtures, fitting or appliance in a manner which may allow sewage, wastewater or any other liquid not authorized by these regulations to ingress or flow into the stormwater system. (3) No person or customer shall discharge wastewater anywhere except into wastewater facilities, a private on-site wastewater system or a private central wastewater collection system and treatment facility. (4) Where in the opinion of the Commission, there exists a risk of sewage, wastewater or any other liquid not authorized by these regulations, flowing into a stormwater system, the Commission may require a customer, at such customer's sole cost and expense, to install or remove at any point on a stormwater system, one or more fittings or appurtenances to prevent such connection. (5) The Commission may require a Stormwater Building Service Connection to be inspected and brought into compliance with the provisions of these regulations, at the property owner's expense, when a new service account is created.
Swimming Pools and Spas 68(1) Swimming or wading pool contents shall be transported for disposal away by a hauler contracted by the pool owner for that purpose, be discharged by a temporary connection to wastewater facilities, or by controlled discharge to the owner's property such that the discharge is at all times contained within the property until it evaporates or infiltrates into the ground. (2) No person shall discharge swimming pool or wading pool contents a) directly or indirectly to a stormwater system unless all disinfectant chemicals have been neutralized;
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b) in such manner that may cause the conduct of soil or sediment into a stormwater system.
PART XII - PRETREATMENT
Pretreatment Facilities 69(1) Where required by the Commission, an owner or operator of a pretreatment facility shall install on its premises prior to the sampling point, a wastewater pretreatment facility. (2) An owner or operator of a pretreatment facility shall ensure the design, operation and maintenance of a pretreatment facility that achieves its treatment purpose in accordance with its manufacturer's operating specifications. (3) An owner or operator of a pretreatment facility shall ensure any waste products recovered from a pretreatment facility are not discharged into the wastewater or stormwater system (4) Maintenance records and waste disposal records respecting a pretreatment facility shall be available to the Commission upon request, which records shall be retained by an owner or operator of a pretreatment facility for a minimum of two years following the generation of such records.
Food Related Grease Traps or Interceptors 70(1) Any person who has a permit to operate a restaurant or like food service establishment, or an industrial, commercial or institutional premises where food is cooked, processed or prepared, and which premises is connected directly or indirectly to a wastewater or combined sewer system, shall take all reasonable measures to ensure that cooking oils and greases are prevented from entering the wastewater or combined sewer in excess of the amounts permitted by these regulations. (2) In respect of cooking oils and greases referred to in subsection (1), a) Grease traps or interceptors shall not discharge to storm sewers. b) The owner or operator of a premises referred to in subsection (1) shall install, operate, and properly maintain an oil and grease interceptor in any piping system at such premises that connects directly or indirectly to a sewer line. c) Grease traps or interceptors shall be installed in compliance with the most current requirements of the applicable Building Code Act and regulations. d) The installation of grease traps and interceptors shall meet the requirements of the Canadian Standards Association national standard CAN/CSA b-481.2, as amended. e) Maintenance requirements for grease traps and interceptors shall be posted in the workplace in proximity to the grease trap and interceptor.
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f) A maintenance schedule and record of maintenance for each grease trap and interceptor shall be available to the Commission upon request for each such device installed. g) The owner or operator of a premises referred to in subsection (1) shall keep documentation respecting proof of the grease trap or interceptor clean-out and oil and grease disposal for a period of two years following the generation of such a record. h) No person shall use enzymes, bacteria, solvents, hot water or other agents to facilitate the conveyance of oil and grease through a grease trap or interceptor to a sewer system. i) Removal of retained or trapped materials from a grease trap or interceptor shall be accomplished by pumping or other physical means and the resulting recovered material shall be hauled away and disposed in accordance with applicable statutes and regulations.
Vehicle and Equipment Service Oil and Grease Interceptors 71(1) Every owner or operator of a vehicle or equipment service station, repair shop or garage or of an industrial, commercial or institutional premises or any like establishment where motor vehicles are repaired, lubricated or maintained, and where the wastewater discharge is directly or indirectly connected to a sewer, shall install an oil and grease interceptor designed to prevent motor oil and lubricating grease from passing into the wastewater or combined sewer in excess of the amounts permitted by these regulations. (2) In respect of motor oil and lubricating greases referred to in subsection (1), a) Oil and grease interceptors shall not discharge to storm sewers. b) The owner or operator of a premises referred to in subsection (1) shall install, operate, and properly maintain an oil and grease interceptor in any piping system at such premises that connects directly or indirectly to a sewer line. c) Oil and grease interceptors shall be installed in compliance with the most current requirements of the applicable Building Code and regulations, and be maintained as recommended by the Canadian Petroleum Products Institute (CPPI). d) All oil and grease interceptors and separators shall be maintained in good working order by the owner or operator of the premises, according to the product manufacturer's recommendations and shall be inspected regularly to ensure performance of such interceptors and separators is maintained to the manufacturer's specifications for performance and to ensure surface oil and sediment levels do not exceed the recommended level. e) A maintenance schedule and record of maintenance for each oil and grease interceptor installed shall be submitted to the Commission annually by the owner or operator of a premises referred to in subsection (1). f) The owner or operator of a premises referred to in subsection (1) shall keep documentation respecting proof of the interceptor clean-out and oil and grease disposal for a period of two years following the generation of such a record.
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g) No person shall use enzymes, solvents, hot water or other agents to facilitate the conveyance of oil and grease through an oil and grease interceptor to a sewer system. h) Removal of retained or trapped materials from an oil and grease interceptor shall be accomplished by pumping or other physical means and the resulting recovered material shall be hauled away and disposed of in accordance with applicable statutes and regulations.
Sediment Interceptors 72(1) Every owner or operator of a premises from which sediment may directly or indirectly enter a wastewater facility, including premises using a ramp drain or area drain and including vehicle wash establishments, shall take all reasonable measures to ensure that such sediment is prevented from entering a wastewater facility in excess of the amounts permitted by these regulations. (2) In respect of the sediment referred to in subsection (1) a) Catch basins installed on private property for the purpose of collecting stormwater and carrying it into the storm sewers shall be equipped with an interceptor, as required by the Commission. b) The installation of catch basins referred to in clause (a) shall comply with the Commission's Design and Construction Specifications, as they may be amended from time to time. c) All sediment interceptors shall be maintained in good working order by the owner or operator of the premises, according to the product manufacturer's recommendations and shall be inspected regularly to ensure performance of such interceptors is maintained to the manufacturer's specifications for performance. d) Removal of retained or trapped materials from a sediment interceptor shall be accomplished by pumping or other physical means and the resulting recovered material shall not be discharged to the wastewater or stormwater system. e) The owner or operator of a premises referred to in subsection (1) shall keep documentation respecting proof of the of the interceptor clean-out and sediment disposal for a period of two years following generation of such a record. f) A maintenance schedule and record of maintenance for each sediment interceptor shall be submitted to the Commission upon its request.
PART XIII - MONITORING, SAMPLING AND REPORTING
Wastewater Service Reporting Requirements

73(1) No person shall discharge sewage, wastewater, non-contact cooling water, or any combination thereof, from an industrial, commercial or institutional premises to wastewater
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facilities without first submitting to the Commission reports which shall be in Form 1 and Form 2. (2) A person who files reports with the Commission in Form 1 and Form 2 shall file further reports in Form 1 and Form 2 as information contained in such Forms, as filed, changes. (3) The Commission may require additional information to that which is contained in either Form 1 or Form 2 at any time.
Wastewater Service Compliance Agreement 74(1) The Commission may enter into a compliance agreement with a person who discharges into a wastewater facility but who is not in compliance with these regulations for the purpose of having such person comply with these regulations. (2) A compliance agreement referred to in subsection (1) shall: a) be for a fixed term; b) contain reporting requirements to the Commission on significant stages in a process for a person to comply with these regulations; c) include terms and conditions for discharges into a wastewater facility during the term of such compliance agreement; and d) include a termination clause providing for termination by the Commission where, in the opinion of the Commission, another party to a compliance agreement is not meeting the terms and conditions thereof.
Monitoring, Sampling, and Reporting 75(1) The Commission may require a person to undertake monitoring, flow metering, or sampling and reporting to the Commission of any discharge to a wastewater facility and/or stormwater system on such terms and conditions as may be required by the Commission. (2) The monitoring, flow metering and sampling referred to in subsection (1) and subsequent analysis shall be carried out in accordance with Standard Methods by an Accredited Laboratory at the expense of the person referred to in subsection (1). Wastewater and/or Stormwater Service Sampling and Analytical Requirements 76(1) Where the Commission requires sampling to determine the concentration of substances in wastewater or stormwater, the sample may a) be collected manually or by using an automatic sampling device; b) contain additives for its preservation; and c) be collected by grab sample or composite samples.
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(2) All tests, measurements, analyses and sample handling referred to in subsection (1) shall be carried out in accordance with Standard Methods and by an Accredited Laboratory.
Wastewater and/or Stormwater Monitoring Access Point 77(1) The Commission shall require the installation of a monitoring access point or the upgrading of an existing monitoring access point, for each connection to a wastewater facility or a stormwater system for the purpose of monitoring, flow metering or sampling discharges unless exempted by the Commission. (2) A monitoring access point under this Section shall be i. located on the property of the person discharging into a wastewater facility or a stormwater system, unless the Commission permits an alternate location; constructed and maintained at the expense of the person referred to in clause (i) ; accessible at all times by the Commission; constructed in a manner which meets the standards of the Commission; maintained to ensure access and structural integrity; offset behind the street line, unless otherwise approved by the Commission or located on the property of the owner or operator of the premises, as close to the property line as possible, unless otherwise permitted by the Commission; and maintained in a manner which is free of buildup, deposits, or such other condition as may prevent sampling or monitoring.
ii. iii. iv. v. vi.
vii.
Spills 78(1) In the event of a spill of a substance capable of having an adverse effect on a water, wastewater or stormwater system or the environment, including the health of humans and reasonable enjoyment of life or property, the person having responsibility for or management or control of such spill or its source shall immediately notify and provide any requested information with regard to the spill as provided herein. (2) A person having responsibility, management or control of a spill referred to in subsection (1) shall report the occurrence of such spill as follows, i. If there is any immediate danger to human health and/or safety such person shall contact the Canadian Coast Guard at 426-6030 or 1-800-565-1633, Nova Scotia Environment at 1-877-936-8476 and the Commission at 311; If there is no immediate danger apparent to such person, that person shall contact the Commission at 311; and
ii.
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iii.
in either circumstance set out in (i) and (ii) hereof, such person shall contact the owner or occupant of the premises where the spill occurred.
(3) The person referred to in subsection (1) shall provide a detailed report on the spill to the Commission, within five working days after the spill, containing the following information to the best of his or her knowledge: i. ii. Location where the spill occurred, Name and telephone number of the person who reported the spill and the location and time where they can be contacted, Date and time of spill, Material spilled, Characteristics and composition of material spilled, Volume of material spilled, Duration of spill event, Work completed and any work still in progress in the remediation of the spill, Preventive actions being taken to ensure a similar spill does not occur again, and Copies of applicable spill prevention and spill response plans for future events.
iii. iv. v. vi. vii. viii. ix. x.
(4) The person referred to in subsection (1) shall take all reasonable measure to contain the spill, protect the health and safety of citizens, minimize damage to property, protect the environment, clean up the spill and contaminated residue and restore the affected area to its condition prior to the spill. (5) The Commission may invoice a person responsible for a spill to recover its costs of time, materials and services as a result of the Commissions response to the effect of such spill on the Commissions stormwater or wastewater facilities and such person responsible for a spill shall pay the Commissions costs as invoiced.
Offences 79. Where the Commission believes that a person has contravened any provision of these regulations, it may commence proceedings by issuing a Summary Offence Ticket in accordance with the Nova Scotia Summary Proceedings Act.
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ATTACHMENT 1
HALIFAX REGIONAL WATER COMMISSION PROCEDURE FOR ACCEPTANCE OF PRIVATE COMMUNITY WATER, WASTEWATER AND STORMWATER SYSTEMS
INTENT: This procedure sets out the requirements for the Halifax Regional Water Commission (HRWC) to accept existing private community water, wastewater and stormwater systems into HRWC's plant. SYSTEM DEFINITION: A private community water, wastewater or stormwater system (a community system) is defined as an existing system serving at least ten (10) individual dwellings. The portion of the system eligible for acceptance by Halifax Water includes: The treatment plant(s) and/or pumping station(s) within the public road right of way, public easement or community system owned land, and The system pipes and appurtenances within the public road right of way or public easement, and The portion of the individual service laterals within the public road right of way or public easement.
The portion of the service lateral on private property shall remain the responsibility of the individual property owner. Halifax Water will not consider acceptance of a standalone community stormwater system. Stormwater systems may be considered for acceptance as an ancillary part of an existing community wastewater system. INTRODUCTION: HRWC's infrastructure generally conforms to industry standards and the HRWC design and construction specifications. Further, Nova Scotia Environment (NSE) has published its Surface Water Treatment Standard and Groundwater Treatment Standard which identify the acceptable level of treatment for surface and ground waters, respectively. Existing HRWC systems meet these standards. For a community system to be accepted into HRWC's plant, HRWC requires that the community system meets or can be upgraded to HRWC and Federal/Provincial standards.
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PROCEDURES FOR ACCEPTANCE: A. Pre-Qualification 1. To qualify for consideration of acceptance, it must be demonstrated by the applicant that the community system will meet, or can be upgraded to meet, the following basic design standards: Water System a) A reliable source of supply from a quantity point of view. b) Compliance with the NSE Groundwater Treatment Standard or Surface Water Treatment Standard, as applicable. c) Water meters for each individual customer, and individual service lines with shutoff valves. d) Adherence with HRWC design and construction specifications, where directly applicable. e) In addition to the appropriate Treatment Standard, adherence with the health and aesthetic parameters of the Guidelines for Canadian Drinking Water Quality. Wastewater and Stormwater Systems a) Wastewater and Piped Stormwater Systems Compliance with all applicable Federal and Provincial legislation, regulations and requirements. b) Adherence with the Atlantic Canada Wastewater Guidelines Manual for Collection, Treatment and Disposal. c) Adherence with HRWC design and construction specifications, where directly applicable. 2. If the above requirements in 1 above cannot be established, the community system cannot be accepted by HRWC, and the application will proceed no further. B. Application for Acceptance If the requirements of 'A' have been met, the application for acceptance of the community system will be made by the community system customers. The cost of the application will be borne by the applicants. The application will consist of: a) A petition signed by two-thirds of the persons identified by the community system as its customers. b) The engineering drawings, as available.
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c) A System Assessment Report, conducted in accordance with NSE's Terms of Reference for System Assessment Reports, and sealed by a professional engineer. d) A pre-design report for all required upgrades to the system(s) to meet the HRWC design standards including a detailed estimate of costs. Note - The engineering drawings shall consist of: a) Record drawings for the water supply or wastewater treatment plant. b) Layout of the community showing the location of distribution and collection piping and services. c) Survey plan identifying property parcels and easements necessary for conveyance of the system to HRWC. C. HRWC Board and NSUARB Approval With receipt of a complete and compliant Application for Acceptance, HRWC staff shall prepare a report for recommendation of acceptance of the community system by the Halifax Water Board. Subsequent to HRWC Board approval, a request shall be sent to the NSUARB for approval of the community system acceptance.
D. Transfer Agreement Subsequent to the approval of the NSUARB, an agreement will be executed with the applicant finalizing the transfer. The terms and conditions of the agreement shall include: Requirement to design, construct and commission all required system upgrades by the applicant with all costs paid by the applicant. Upon completion of the required upgrade work, certification from the applicants engineer that all required upgrades have been completed to the required standards. Transfer of all assets of the community system, including any land or easements to HRWC with all costs paid by the applicant.
As an alternative mechanism for the payment of the upgrade costs, HRM Council may establish a betterment charge for the utility customers to collect the project costs. Once the agreement with the applicant has been executed, betterment charge notices will be sent to all customers of the system. The amount of assessment will be based on equivalent units of a 15 mm water meter (or an equivalently equitable means for wastewater systems), with all utility customers being responsible for the total cost of the project. The betterment charges shall be paid in accordance with the HRM Local Improvement By-law Policy and until payment is complete, shall constitute a lien against the property in respect to which
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the charges levied, as provided for in the Local Improvement By-law, subject to approval by HRM Council. Upon completion of the project, staff will recommend to HRM Council that the betterment charges be levied. When all conditions of the agreement have been met, including the full payment of all associated costs (including the final levying of any associated HRM betterment charge), HRWC will take formal ownership of the system(s) and establish customer contracts to provide service. E. Rate Structure: The rate structure for newly accepted community systems will be based on full cost recovery with a cap at 2.5 times the actual urban core rates in effect.
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ATTACHMENT 2
HALIFAX REGIONAL WATER COMMISSION
EXTRA STRENGTH SURCHARGE FORMULA
The Extra Strength Surcharge shall be based on the following formulas. The surcharge may apply to one or more of the parameters. Where more than one parameter applies, the surcharge shall be calculated for each parameter separately, and then added together to arrive at the total Extra Strength Surcharge. a) Surcharge Parameters BOD5 S.S. Biochemical Oxygen Demand Suspended Solids, Total
b) Limit Values Surcharges shall be calculated based on the following limit values:
Parameter Biochemical Oxygen Demand (BOD5) Suspended Solids, Total (S.S.) Limit (mg/L) 300 300
c) Rate The Extra Strength Wastewater Surcharge rates are as follows: Effective April 1, 2013: BOD5 : $1.0696 per kg and SS: $1.0289 per kg Effective April 1, 2014: BOD5 : $1.2775 per kg and SS: $1.2226 per kg d) Load The value of the load shall be based on test results from the customer. The testing program to be used to arrive at the limit shall be approved by the Commission.
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e) Flow The flow will be the flow from the customer measured at the location approved by the Commission. The measurement method and frequency shall be approved by the Commission.
Extra Strength Surcharge Formulas The surcharge shall be calculated for each parameter using the following formulas:
BOD5 Surcharge S.S. Surcharge [Load (mg/L) - Limit (mg/L)] x [Flow (m ) x Rate ($/kq)] / 1000 [Load (mg/L) - Limit (mg/L)] x [Flow (m ) x Rate ($/kq)] / 1000
3 3
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ATTACHMENT 3
HALIFAX REGIONAL WATER COMMISSION WATER, WASTEWATER AND STORMWATER CAPITAL COST CONTRIBUTION POLICY
PART I: Introduction The Water, Wastewater and Stormwater Capital Cost Contribution (WWS CCC) Policy provides for the recovery of costs required to provide oversized water, wastewater and stormwater infrastructure within a 'charge area'. The costs of providing this infrastructure are shared by developers, and in some cases, by the Commission. After the completion of a Master Plan Study, a charge area will be established that becomes the basis for the development of a WWS CCC Charge. The WWS CCC Charge shall take into consideration all aspects of the required infrastructure, financial risks to the Commission, timing of contributions, phasing of development and any other considerations that could have a financial impact on the Commission.
Section 1: Master Plan Study Area & Charge Area a) The Master Plan area and terms of reference for the study as it relates to the Commission must consider such factors as density, existing water, stormwater and wastewater systems, drainage basins, existing & proposed water service districts, service boundaries, land use development areas, soil conditions, topography, and other factors deemed appropriate. The Master Plan area is not constrained by land ownership. b) The charge area will generally be the Master Plan study area. However, depending on service considerations, the charge area may also include areas outside the Master Plan area. c) Oversized water, wastewater and stormwater infrastructure will be defined in the Master Plan for the charge area. Notwithstanding, the impact on existing or planned infrastructure outside the Master Plan study area will be taken into account in the Master Plan Study. The Commission may require information from the developer(s) regarding the planning and system requirements in the preparation of the Master Plan.
Section 2: Oversized Components a) Oversizing components of a charge area may include, but are not necessarily limited to water distribution and transmission system including pumping stations, pressure reducing chambers and reservoirs, wastewater collection system including pumping stations and stormwater collection systems including retention ponds. The infrastructure required to
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service a charge area may be located outside of the charge area and may include land costs (including easements) associated with providing required infrastructure. b) Infrastructure which is exterior to a charge area, such as water and wastewater treatment plants and related infrastructure may be included in the capital cost calculations. In any event, all costs of Oversized Infrastructure to provide service to the charge area will form part of the WWS CCC.
Section 3: Oversized Infrastructure Required to Serve Future Developments a) Where oversizing of infrastructure within a charge area is identified as providing benefit to future development, the Commission may invest in the Oversized Water, Wastewater and Stormwater Infrastructure required for the future development. b) The oversizing required to service future development on lands adjacent the charge area, shall be determined, and the investment by the Commission shall be evaluated in accordance with the Funding Criteria defined in Section 18.
Section 4: Drainage from Adjacent Lands In a Master Plan Area, if drainage from adjacent lands requires the oversizing of storm sewers, the cost of providing the oversizing will form part of the WWS CCC for the charge area.
Section 5: Oversized Infrastructure that Benefits Existing Developed Areas a) Where an existing developed area receives a direct service benefit from Oversized Water, Wastewater and Stormwater Infrastructure, the Commission may pay a share of the oversized system costs based upon the Capital Costs per acre. The Commission's share is not included in the WWS CCC recovered from new development within the charge area. b) The Commission will establish the extent to which the existing developed areas receive a benefit from Oversized Water, Wastewater and Stormwater Infrastructure. This benefit will be determined according to the procedures and guidelines of this Policy. c) Where system capacity provided by new infrastructure within a charge area is used by existing serviced areas, to a degree less than or equal to that existing system capacity used by the charge area, the Oversized Water, Wastewater and Stormwater Infrastructure required for the charge area will not be considered a benefit to the existing area. d) Existing developed areas may be excluded from a charge area if they are not included in the new infrastructure design calculation, or do not derive a direct benefit from these new systems. e) Where the Commission has contributed to existing developed areas contained in a charge area, the Commission may recover from WWS CCC from infilling or by way of rezoning, or subdivision, the Equivalent Capital Cost Contributions from new development within the existing community. In effect, the Commission may make payment of Water, Wastewater
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and Stormwater Capital Cost Contributions in advance for future development in existing areas and recover the contributions when new development occurs. f) The Commission's expenditures shall be evaluated in accordance with the Funding Criteria defined in Section 18, Funding Criteria.
Section 6: Upfront Payment of Oversized Infrastructure by the Commission a) To fulfill its leadership role, the Commission may consider it necessary to invest in the oversized and required water, wastewater and stormwater infrastructure in a charge area in advance of the revenue stream necessary to construct the systems. b) The Commission may also decide to facilitate the acquisition of rights-of-ways, land, and other required systems or facilities beyond the control of one or more developers. Commission investments shall be evaluated in accordance with the criteria determined in Section 18, Funding Criteria.
Section 7: Infrastructure Exterior to the Charge Area a) Oversized and required infrastructure exterior to the charge area will be included in the capital Oversized Water, Wastewater and Stormwater Infrastructure for the charge area. The Commission will be required to accurately establish the Oversized Infrastructure that is attributed to a specific charge area. b) Water, Wastewater or Stormwater facilities would only be included in the capital cost if their upgrade or expansion can be directly attributable to a specific charge area.
Section 8: Cost Estimates a) The basis for the WWS CCC is an estimate of the Oversized Infrastructure required to service the charge area. The estimated costs shall be escalated to account for the year in which the construction takes place and shall include interest during construction. The Commission will use the ENR Canada Indices to estimate costs in the future, in accordance with Section 14, Timing and Sequencing of Development. In addition, the Commission will include appropriate administration costs for the projects. b) The Commission, in consultation with the developers, will develop the cost estimates for Oversized Water, Wastewater and Stormwater Infrastructure, both within and outside the charge area, that will form the basis of the CCC. The Commission will make every effort to establish cost estimates in consultation with the Stakeholders. The Commission may accept the developers' estimates to construct the systems if the developers agree to construct the Oversized Water, Wastewater and Stormwater Infrastructure at the estimated cost. Section 9: Cost Apportionment Criteria a) The revenue stream arising from cost apportionment will be used in the Financial Plan of
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the charge area. b) For water, wastewater and stormwater infrastructure costs, a density factor related to system demand will be utilized to apportion costs. c) The WWS CCC is based on average density per acre for the entire charge area, adjusted for the actual density or land use within the parcel being subdivided. Actual density of the parcel being subdivided shall be determined at the time of Subdivision Approval using the maximum density which is permitted by the Municipal Planning Strategy or land use permitted by the Municipality's Land Use Bylaw. d) If the density in a sub-division is lower than the average, the WWS CCC may be accelerated based on the average, ratio amount until the total WWS CCC for the subdivision is collected from a developer. This process may be applied if cash flow requirements dictate more funds are needed to pay for required infrastructure. e) In institutional, commercial or industrial zones or uses, the average density for the charge area will apply. The area of the parcel being developed will be adjusted to allow for multiple units or equivalent people. f) Stormwater Collection Systems are considered in the same manner as wastewater systems. This approach implies there is a relationship between development density and the amount of stormwater run-off which is generated. Given the accuracy and factor of safety inherent in estimating run-off, there is a direct relationship between density and runoff for residential development. (Refer to Figure 1). g) Although the same relationship does not exist for industrial, commercial, or institutional uses, this policy accepts that apportioning stormwater collection system costs on the basis of density is a reasonable, fair, and equitable approach. This approach is also supported by the fact that storm sewers often share the same trench as other services, and are administered in the same construction contract. h) The fairness and equity of this approach may be enhanced by implementing design specifications which require run-off levels to be maintained at residential levels. Such policies are easily implemented through the site design specifications.
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Figure 1: Impervious Area vs Development Density
Impervious Area vs Development Density

/Percent Impervious Ares")
Based on Hydrology, Federal Aviation Administration. NEC No.. 19, 1984
60 70 60 60 40 30 20 10
0 Single Family detached, 18 ppa Multi-unit, detached/attached, 36 ppa Apartment dwelling. 60 pp
Density, (ppa)
Section 10: Charge Area Boundary Changes After a charge area has been established and phased development has commenced, there may be reasons to increase or decrease the charge area. The Commission may permit a change in the charge area based on the Oversized Water, Wastewater and Stormwater Infrastructure capacity to provide service to the new area. Changes to charge area boundaries will be considered as either minor additions or major changes. a) A minor addition to a charge area may be considered when the infrastructure within the existing charge area is adequate to provide the required service to the additional area. All new development within the adjusted charge area boundary will pay WWS CCCs, based on the same charges that apply to the original charge area. b) A major change to a charge area is required when the proposed additional area cannot be adequately serviced by the existing infrastructure. New, Oversized Water, Wastewater and Stormwater Infrastructure will be required and a new WWS CCC must be calculated. Capital costs collected from the original charge area will be applied to the funding of the new infrastructure. Where a major change in the charge area is required, a revised Master Plan Study, a new charge area and corresponding WWS CCC will be calculated. These changes may require amendments to the Rules and Regulations or established Charge Area as per NSUARB to the charge area
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under consideration. Major changes may include expansion or extension of the charge area boundary or; a combination of two existing charge areas requiring a revision to the capital cost contributions calculated from the area. A developer in the original charge area will not be required to pay a WWS CCC which exceeds the amount calculated in the original charge area.
Section 11: Combined Charge Areas Where two charge areas are adjacent and there are valid reasons to share some or all of the entire Oversized Water, Wastewater and Stormwater Infrastructure, the Commission may combine the charge areas and recalculate the WWS CCC. The Commission will determine the components of Oversized Water, Wastewater and Stormwater Infrastructure that will be included in the new charge area. WWS CCC collected from the original charge area will be included in the new charge area, and they will be collected on a go forward basis.
Section 12: Cost Exceptions Costs that will be deducted from the developers' portion of the WWS CCC include the following: The proportion which is considered to benefit the existing Customers of the Commission, as determined in accordance with Section 5. Commission investments in infrastructure for future development or another charge area determined in accordance with Section 3. Section 13: Interest and Risk Mitigation a) The Commission supports new development; however, it is not prepared to accept the financial risk of new development. As a result, where the Commission decides to invest in the Oversized Water, Wastewater and Stormwater Infrastructure before the required contribution is collected, interest will be added to the WWS CCC. b) In the event that a major component of infrastructure is required before the contributions are collected, the Commission may require the developers to assume the risk and invest in the infrastructure. The developer(s) would be subsequently reimbursed when CCCs are received by the Commission through continued development in the charge area. c) (i) The WWS CCC shall be indexed by the Commission on July 1, 2012, and in each subsequent year on April 1, in accordance with the indexing set out in the Consumer Price Index for Halifax, as published by Statistics Canada for the immediately preceding month, when compared to the same month for the immediately preceding year.
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(ii)
If the Consumer Price Index calculated in (i) is negative, the WWS CCC will not be adjusted if the resulting CCC: A. is lower than the initial WWS CCC; or B. results in a cash flow model that does not indicate a full recovery of capital costs within the time period specified in such model.
d) The WWS CCC as indexed in clause (c) shall be: (i) Reduced to the next nearest dollar where it indicates a part of a dollar less than $0.50; and Increased to the next nearest dollar where it indicates a part of a dollar equal to or greater than $0.50.
(ii)
e) The Commission will revise rates in accordance with the results of the application of calculation in clauses (c) and (d) and shall provide an annual information report of such results to the Board.
Section 14: Timing and Sequencing of Development a) The development phasing will be taken into consideration when designing and costing oversized infrastructure in the charge area. Since WWS CCCs are calculated on the basis of best estimates, reasonable and appropriate estimates must also be made in respect of development timing and corresponding cost escalators and interest rates that are dependent on the developers' schedule. b) The infrastructure capital cost estimate will be factored upwards to reflect prudent and appropriate cost escalators based upon interests and escalated cost of servicing, indicated through the ENR Canada index factor. c) The Commission will track and record all WWS CCC funds and expenditures. Interest will be charged when the account is in deficit and will be credited when the account is in surplus. d) The Commission may require significant components of infrastructure be built at a predetermined time frame; or based upon system demands or capacity loading arising from new or existing development. The significant components will be constructed within the time frame established by the Commission. As an example, the timing of a major interchange, pumping station or water reservoir which may be required and administered by an outside agency. e) The timing and sequence of development phasing may also have an impact upon the design capacity (or size) of infrastructure needed to provide adequate interim service standards throughout development stages in the charge area. It would be inappropriate for the Commission to approve the installation of services that did not adequately meet the design guidelines and minimum service standards to provide requisite services to its citizens. f) Additional Oversized Water, Wastewater and Stormwater Infrastructure may be required at interim stages of the development as deemed appropriate by the Commission. Costs
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associated with interim infrastructure needed to advance the timing of the development may not be included in the CCC costs if no benefit is achieved by the Commission. g) The Commission may require security (irrevocable, automatically renewing letter of credit) on the property when a development agreement has been approved by the Municipality, to indemnify the Commission in the event that the development does not proceed in the prescribed period of time. The amount of the lien will be equal to the WWS CCC that would have been collected from the area in question. h) The Commission will determine the sequence of oversized system construction, based upon information from the developer, and the requirements of the development. The Commission in consultation with the Municipality will determine the densities for each phase of the development in the charge area. i) The Commission may, in some cases, construct infrastructure prior to receiving the necessary WWS CCC; or require the developers to construct the Oversized Water, Wastewater and Stormwater Infrastructure. Developers may be required to construct Oversized Water, Wastewater and Stormwater Infrastructure in an earlier phase that will be used in latter phases of the development.
Section 15: Developers Acting as Contractors a) A developer may be allowed to construct some or all of the Oversized Water, Wastewater and Stormwater Infrastructure based on the agreed upon estimates in compliance with the Commission's standards and guidelines. In most cases developers will be required to construct Oversized Systems in their development lands, but the Commission reserves the right to construct oversized or required infrastructure for the charge area. b) When the Developer is acting as a contractor, the Commission will inspect service system construction to ensure the system(s) meet Commission Design Guidelines. The developer will be required to build the infrastructure as required by the phased development determined in the Master Plan Study. c) Cost estimates for Oversized Systems and associated payment schedules will require a WWS Service Agreement to determine & implement WWS CCCs. The payment to the developer is based upon agreed cost estimates amongst the participating Stakeholders and approved by the Board. d) The Commission will inspect the system construction to ensure it meets its guidelines. The Developer will provide full inspection services and certification by a consultant for design compliance.
Section 16: Specific Infrastructure Components a) Specific components of Water, Wastewater and Stormwater systems such as sewage pumping stations and stormwater storage facilities will form part of the Capital Cost if they provide a Direct Benefit to more than one developer within the charge area. In this instance, the costs will be apportioned in accordance with the WWS CCC Policy using the appropriate design criteria, and may include land costs
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b) Components that provide only local benefits, and service a part of one development within the charge area, are solely the responsibility of the developer of the parcel. c) The Commission may require the developer who first requires a pumping station to build the Oversized Infrastructure and subsequently reimburse oversizing costs when the Commission has collected from future developments or apply a WWS CCC credit to the developer for the Oversized Water, Wastewater and Stormwater Infrastructure investment.
Section 17: Oversized Infrastructure Criteria a) Oversizinq Criteria The cost of providing Oversized Water, Wastewater and Stormwater Infrastructure will be funded through the WWS CCCs levied in a charge area. The cost of providing Oversized Water, Wastewater and Stormwater Infrastructure may also include discrete upgrades of, or new connections to, existing systems outside of the charge area. There are several methods of calculating the oversize cost, which generally fall into one of the following categories: i. Incremental basis:
Where the oversize cost would be calculated by determining the incremental or marginal cost of up-sizing to the required Oversized Water, Wastewater and Stormwater Infrastructure defined in the Master Plan. This method is most fairly applied if there is a base value or benefit associated with providing the minimum service requirements without considering oversizing. For the purpose of oversizing, minimum service requirements would be those necessary to provide service to an area being developed and may be based on minimum pipe sizes and local road standards . ii. Flow Proportioning: The incremental costs of the oversized component(s) in a Master Plan Area may be distributed amongst the land owners on a flow proportionate basis as determined by their allowable densities noted in the Municipal Planning Strategies or land use in the Land Use Bylaws. iii. Capacity basis: Where the oversize cost is determined on the basis of capacity allocated to the charge area. The cost to be recovered through a WWS CCC would be calculated by pro-rating total cost on the basis of capacity. This method is most fairly applied for a discrete upgrade of an existing system outside of the charge area. b) Water, Wastewater and Stormwater Systems within a Charge Area The oversized costs to provide water, wastewater and stormwater systems within a charge
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area will be determined on an incremental basis. There are various methods for calculating incremental costs of piped systems: i. Dual Design Method: Where the oversize cost is determined by deducting the total cost of the minimum required pipe size from the total cost of the oversized pipe. ii. Cost Ratio Method: This method assumes a direct relationship between the cost of providing a service and the size of the pipe. A cost factor can be determined and applied similar to the Cost Sharing Policy of the former City of Halifax, or a simple percentage based on nominal dimensions may be applied. c) Infrastructure Exterior to a Charge Area The portion of the cost of an upgrade, expansion, or provision of a discrete component of water, wastewater and stormwater infrastructure to be recovered through a WWS CCC will be determined on the basis of capacity allocated to the charge area.
Section 18: Funding Criteria a) Opportunity costs should be considered and calculated in an effort to prioritize the Commission's investment. These costs may be used to compare and contrast the investment potential in one charge area versus another request for funding. Opportunity costs may include consideration of existing system capacities, potential diversion of demand and capacity allocations, or mitigation of future capital expenditures arising from strategic Commission investments from a regional perspective. Other cost factors for consideration include treatment plants, trunk piping systems and other support services including operations and maintenance. b) The Commission in consultation with the HRM may opt to encourage development and growth in strategic areas by supporting Master Plan funding on a priority basis. The Commission may initially invest in comprehensive Master Plan studies where it wishes to promote growth and development optimizing use of existing systems and services. c) Inevitably, the demand for the Commission's and the HRM's contributions and investments for Capital Cost Contribution Policy may require priority decisions from the Commission's Board and Council. A balance of strategic master planning will mitigate future capital costs through good planning and optimized infrastructure utilization. d) The Commission may determine the risk too high in consideration of upfront payments for Oversized Water, Wastewater and Stormwater Infrastructure. In this case, development may proceed if the developers build the required infrastructure. The developers may be given Water, Wastewater and Stormwater Capital Cost credits to future contributions or may be re-paid when the Commission collects future WWS CCC from subsequent development utilizing these Oversized Water, Wastewater and Stormwater Systems. The requirement for security would reduce the risk to the Commission if development does not
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proceed. Time will be the essence of any agreement and may determine the type and condition of the security required to mitigate the Commission's financial risk.
Section 19: WWS CCC Payment The applicable WWS CCC shall be payable to the Commission at: (i) (ii) the issuance of a subdivision approval; or where development is permitted to occur without a subdivision approval, prior to connection by the Commission of a water meter.
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PART II: WWS CCC Policy Templates The capital cost templates and supporting notes will be used to calculate Water, Wastewater and Stormwater Capital Cost Contributions.
WATER, WASTEWATER AND STORMWATER CAPITAL COST CONTRIBUTION FORMULAS

Water, Wastewater and Stormwater A B C D E F G H I J K L Total cost of Oversized Infrastructure and other required infrastructure (wastewater ,Stormwater) Total cost of Oversized Infrastructure and other required infrastructure( water) Interest during construction Total cost of infrastructure Deduct infrastructure that benefits the Commission Deduct fire protection charges paid by the HRM - From water Infrastructure only (Item "B" above) Total Capital Cost Contribution Gross area (acres) in charge area Area of land that cannot be developed Area of land that can be developed Development charge per acre Average Density (ppa) of charge area (H - I) (G / J) (D - E - F) (A + B + C)
Adjustments for Density of the Parcel being Subdivided M N O P Area of Parcel Being Subdivided Density (ppa) for parcel being subdivided Capital Cost Contribution per Acre Total Capital Cost Contribution K x (N / L) OxM
Notes to Capital Cost Formula 1. The cost of Oversized Infrastructure and other required infrastructure is based on an estimate of construction that includes engineering design. Other items to be included are planning studies, land purchases, surveying costs, legal costs and Commission audit inspection costs. The costs will be escalated based on the ENR index to the year costs are incurred for each component of the infrastructure. 2. The interest rate shall be the prime bank rate plus one percent. The construction period is assumed to be two years. 3. Benefits to the Commission may include infrastructure costs that benefit the existing population of the Commission. i. If there is an area within the charge area that benefits the Commission and the Commission pays a portion of the oversized and other infrastructure costs, any vacant land within the area that is developed shall pay a WWS CCC equal to cost
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per acre paid by the Commission. 4. The fire protection charge paid by the Municipality to the Commission is a percentage of the cost of the oversized water related infrastructure. The current 37% has been calculated based on the fire protection component of the demand assets of the utility as contained in the current rate study. Future rate studies may result in a change in the percentage. 5. Gross area includes all land, including streams and lakes within the charge area. 6. Area that cannot be developed will include streams, lakes, flood plains and any other land deemed non-developable by the Commission. 7. Average density shall be established by the Commission or the Municipality. 8. For industrial, commercial, and institutional uses with multiple storeys, the area of the parcel being sub-divided shall be increased by an amount equal to the allowable floor space of the additional storeys. For the purpose of this calculation, underground parking is considered an additional storey. 9. Development of a parcel of land within a charge area that has density below the average may be required to accelerate contributions on the basis of the average density, until the total required WWS CCC for the original parcel has been made. For industrial, commercial, and institutional uses, density shall be taken as the average density for the charge area.
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Halifax Water Pollution Prevention Program

Abbreviated Discharger Information Report (Form 1)
The completion of this form by all dischargers to wastewater facilities is required under Schedule of Rules and Regulations for Water, Wastewater and Stormwater Services. The Commission may require additional information to that which is contained in either Form 1 or Form 2 at any time.
__________________________________________________________________
(Company Name, Corporation, Owner)
________________________
(Telephone Number)
___________________________
(Fax Number)
__________________________________________________________________
(Mailing address) (Postal Code)
(1)
What are your principal products produced or services provided:
_______________________________________________________________ _______________________________________________________________
(2)
Provide a brief description of your manufacturing or service activities:
_______________________________________________________________ _______________________________________________________________
(3) Are there now or will there be in the future any of the following wastewater discharges? Process wastewater Non-contact cooling water Yes / No Yes / No
Other sources of wastewater (other than sanitary) Yes / No (if yes, brief description)
______________________________________________________________ ______________________________________________________________
(4) Please list the type of chemicals or other waste materials that are discharged to the sanitary sewer. Please attach sheet if needed.
______________________________________________________________ ______________________________________________________________ ______________________________________________________________

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(5)
Does the site have any existing connections to the following sewers? Sanitary Combined Storm Yes / No Yes / No Yes / No
(6)
Location of Process units? Storage of raw materials? Storage of intermediate products? Storage of final products?
Inside / Outside / Outside but covered Inside / Outside / Outside but covered Inside / Outside / Outside but covered Inside / Outside / Outside but covered
(7)
Is your wastewater subjected to any type of treatment before discharge? Grease Interceptor (CAN/CSA B-481.2) Vehicle and Equipment Service Oil and Grease Interceptor Sediment Interceptor Dental Waste Amalgam Separator Other pre-treatment please describe: Yes / No Yes / No Yes / No Yes / No
_______________________________________________________________
(8) Does the site have any of the following programs in place to address discharges to the sewer system? Pollution Prevention Best Management Plan Environmental Management System Other program / practices Yes / No Yes / No Yes / No Yes / No
______________________________________________ (Name) ______________________________________________ (Telephone) ______________________________________________ (Title) _____________________________________________ (Date of Completion)
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Halifax Water Pollution Prevention Program

Detailed Discharger Information Report (Form 2)
The completion of this form by all dischargers to wastewater facilities is required under Schedule of Rules and Regulations for Wastewater Service if requested by the Commission. The Commission may require additional information to that which is contained in either Form 1 or Form 2 at any time. Please print clearly while completing the form.
_____________________________________________________________________
(Company Name, Corporation, Owner)
_________________________
(Telephone Number)
__________________________
(Fax Number)
_____________________________________________________________________
(Mailing address) (Postal Code)
1. What are your principal products produced or services provided: _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ 2. Provide a brief description of your manufacturing or service activities: _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________
3. Standard Industrial or Canadian Codes (SIC) of those products produced: ___________________ ___________________ ______________________ ____________________ ______________________ ____________________
Indicate if these are [ ] SICs, or Canadian [ ] SICs.
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4. Number of employees:
Plant: ________________ Office: _______________
5. Number of shifts per day:________
Number of shifts per week: _________
6. Please indicate if major processes are:

Batch: Continuous: Both: Seasonal Variation: Yes / No Yes / No Yes / No Yes / No
If yes indicated, briefly describe your seasonal production cycle:
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________
7. List all sources of water supply:

Municipal water Private well water Hauled water Other sources (Describe) Estimated volume:________________m3/day Estimated volume:________________m3/day Estimated volume:________________m3/day Estimated volume:________________m3/day
8. Type of wastewater discharged: (please check all that apply) ( ) Domestic Wastewater ( ) Non-contact cooling water ( ) Contact cooling water ( ) Process water ( ) Others Estimated volume:________________m3/day Estimated volume:________________m3/day Estimated volume:________________m3/day Estimated volume:________________m3/day Estimated volume:________________m3/day
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9. Wastewater is discharged to: (please check all that apply) Location [ ] Wastewater # 1 [ ] Wastewater # 2 [ ] Storm sewer # 1 [ ] Storm sewer # 2 [ ] Surface water, pond, creek, river, etc. [ ] Storage tank [ ] Ground water or well Estimated Volume ___________________m3/day ___________________m3/day ___________________m3/day ___________________m3/day ___________________m3/day ___________________m3/day ___________________m3/day
[ ] Liquid waste hauler - please indicate company used and disposal site if known:
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________

10. Physical Layout Provide sketch of property (to scale or approximate) showing buildings, pretreatment facility or interceptors, property boundaries, effluent lines, and connections to wastewater, combined and storm sewers. Layout may be attached as separate document - leave note to indicate submission with this form. Flow diagram of the site flows/processes is also required.
11. Provide existing sampling data on the chemical composition and concentrations within the discharges listed above. ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________
DOCUMENT 205111
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12. Pre-treatment devices or processes used for treating wastewater or sludges before discharge to the sewer system. ( Please check as many as is appropriate):
[ ] Air floatation [ ] Screening [ ] Centrifuge [ ] Sedimentation [ ] Chemical Precipitation [ ] Septic Tank [ ] Chlorination [ ] Solvent Separation [ ] Cyclone [ ] Spill Protection [ ] Filtration [ ] Ozonation Type:__________________ [ ] Grease Interceptor Type:___________ [ ] Other treatment Type: _____________ [ ] No Pre-treatment Provided
[ ] Sump [ ] Flow Equalization [ ] Biological Treatment [ ] Grease or Oil Separation [ ] Rainwater Diversion or Storage [ ] Grit Removal [ ] Other Chemical Treatment [ ] Ion Exchange [ ] Neutralization, pH correction [ ] Reverse Osmosis
13. Describe in detail the treatment process for your waste streams including flows, pump run times and size of pumps. Include any relevant operational data:
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________

14. Are solids generated from the pre-treatment process: [ ] Yes [ ] No
If yes, please describe the treatment and disposal method for sludge removal,
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________
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15. Do you recover any chemicals from your wastewater: [ ] Yes If yes, please explain
[ ] No
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________
16. List pollutants or chemicals that have the potential to enter either wastewater or storm sewers due to accidental spills, machinery malfunctions or process upsets:
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________
____________________________________________ (Name) ____________________________________________ (Telephone) ____________________________________________ (Title) ____________________________________________ (Date of Completion)
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Appendix 8 Proposed Rules and Regulations Reference to Proposed Rules & Regulations Section 1 Section 2 Section 3 Reference to Existing Rules and Regulations NA NA Schedule B, Section 1 Change Provides name for regulations Adopts existing definitions in HRWC Act Adds definitions of the terms "adverse effect", "Customer", "Ditch", "Extraneous Water", "Extra Strength Wastewater", "HRM", "NORM", Pretreatment Facility "Spill", "Stormwater Building Service Connection", "Wastewater", "Wastewater Building Service Connection", and "Water Building Service Connection" Amends the definitions of the terms "Dwelling Unit", "Industrial, Commercial or Institutional", and "Infrastructure Charge", "Non-contact Cooling Water" redefined from "Cooling Water" "Wastewater" incorporating the previous definition of "sewage" and "Wastewater Facilities" incorporating the definitions of "Sewer" and "Wastewater Sewer" Deletes definitions of the terms "Dental Amalgam", "Dental Waste Amalgam Separator", "Serviced Land" and Storm Sewer Add principles of interpretation for regulations Updates water rates Updates rates for wastewater service Updates rates for stormwater service Re-drafted provision for temporary service Reason for Change Confirms how regulations may be cited Consistent use of terms in Act and regulations To provide clarity to the meaning and interpretation of the provisions of the regulations using those terms.
Section 3
Schedule B, Section 1
To clarify the meaning of those terms
Section 3 Section 3
Schedule B, Section 1 Schedule B, Section 1
To provide a more accurate definition of the term according to its customary usage To update the definition of the term according to its current customary usage
NA
Schedule B, Section 1
Terms are no longer relevant to the subject matter of the regulations
Section 4 Section 5 Section 6 Section 7 Section 8

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NA Schedule A, Section 1 Schedule A, Section 3 Schedule A, Section 3 Schedule A, Section 4
Provides consistency of interpretation according Interpretation Act (Nova Scotia) To reflect water rates requested in Rate Application To reflect wastewater rates requested in Rate Application To reflect stormwater rates requested in Rate Application To conform to regulatory drafting rules
to
the
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Section 9 Section 10 Section 11 Section 12 Section 13
Schedule A, Section 9 Schedule B, Section 6 Schedule B, Section 7 Schedule B, Section 8 Schedule B, Section 9
Section 14 Section 15 Section 16 Section 17 Section 18 Section 19 Section 20 Section 21 Section 22 Section 23 Attachment 2 Section 24 Section 25 Section 26
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To provide reference to the General Managers power in Section 33 of the HRWC Act to register a lien against real property. This section represents the combination of previous sections Schedule B Section 5 Refusal of Service, Section 9 Suspension of Service for NonPayment of Bills, Section 53 Suspending Service for Violation. Schedule A, Section 12 Charge for staff visit to delinquent Section moved for inclusion with other sections dealing with billing customers Schedule A, Section 17 Charge for retrieval/copies of Section moved for inclusion with other sections dealing with billing customer's bill Schedule A, Section 11 Charge for dishonoured customer Section re-drafted to include contemporary banking payment payments methods and moved for inclusion with other sections dealing with billing Schedule B, Section 4 Deposits Section re-drafted to conform to regulatory drafting rules and moved for inclusion with other sections dealing with billing Schedule A, Section 8 Connection/Disconnection Charge Re-drafted to clarify charges within and outside regular working hours and moved for inclusion with other sections dealing with charges Schedule A, Section 10 Water Meter Installation Charge Re-drafted to clarify charges within and outside regular working hours and moved for inclusion with other sections dealing with charges Schedule A, Section 16 Re-drafted provision for Customer To conform to regulatory drafting rules Monitoring Service Section A, Section 18 Re-drafted provision for Inspection To conform to regulatory drafting rules and moved for inclusion with of New Building Service Connections other sections dealing with charges Schedule A, Section 26 Re-drafted customer Rebate To conform to regulatory drafting rules and moved for inclusion with provision other sections dealing with charges & Schedule A, Section 23 Re-drafted Extra Strength To conform to regulatory drafting rules and to reflect rates & Addendum 'A' Wastewater Surcharge requested in Rate Application Schedule A, Section 19 Review of Drawings and Specs To reflect rates requested in the Rate Application Schedule A, Section 13 Missed Appointment by Customer To conform to regulatory drafting rules and move for inclusion with other sections dealing with charges Schedule A, Section 14 Theft of Service To conform to regulatory drafting rules
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Charge for new accounts Re-drafted provision for payment of bills for service Re-drafted provision for billing adjustments Redrafted provision for estimated meter readings Provides for collection activity on overdue accounts
Section moved for inclusion with other sections dealing with billing To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules
Section 27 Section 28 Section 29
Schedule A, Section 6
Section 30
Section 31 Section 32 Section 33 Section 34 Section 35 Section 36 Section 37 Section 38 Section 39 Section 40 Section 41 Section 42 Section 43 Section 44 Section 45 Section 46 Section 47 Section 48 Section 49 Section 50 Section 51
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To conform to regulatory drafting rules and to reflect rates requested in the Rate Application Schedule A, Section 24 Capital Cost Contribution Charge To conform to regulatory drafting rules Schedule A, Sections 21 Sewer Redevelopment and Trunk To consolidate sewer redevelopment and trunk sewer charges, to & 22 Sewer Charges conform to regulatory drafting rules, to clarify the meaning of outbuilding and to reflect the rates requested in the Rate Application Schedule A, Section 25 Capital Cost Contribution for To conform to regulatory drafting rules, to clarify the meaning of Wastewater Treatment Facilities multiple unit residential building, to clarify the meaning of outbuilding and to reflect the rates requested in the Rate Application NA Recovery of Costs To conform to regulatory drafting rules Schedule B, Section 10 Public Fire Service Charge To conform to regulatory drafting rules and moved for inclusion with other sections dealing with fire protection charges Schedule A, section 2 Public Fire Protection Rate Re-drafted to reflect the rates requested in the Rate Application Schedule A, Section 5 Special Services Supplied from Fire To conform to regulatory drafting rules Hydrants Schedule A, Section 15 Updates charges for building fire Updates charges for sprinklers to reflect rates requested in Rate protection systems Application and adds customer responsibilities for private fire lines Schedule B, Section 3 Liability for payment of service To conform to contemporary regulatory drafting rules Schedule B, section 23 Plumbing standards Updated to refer to current applicable legislation and municipal bylaws Schedule B, Section 24 Prohibited Appliances To conform to regulatory drafting rules Schedule B, Section 25 Updated improper use To include stormwater NA Capacity of Facilities Drafted to enhance hydraulic control Schedule B, Section 44 Pipe Installation To conform to regulatory drafting rules Schedule B, Section 46 Unauthorized extensions/additions To conform to regulatory drafting rules Schedule B, Section 49 Interference with Commission To conform to regulatory drafting rules Water services Schedule B, Section 49 Interference with Commission To conform to regulatory drafting rules, and to break out into Wastewater and Stormwater water, wastewater and/or stormwater. This was previously a Services single section. Schedule B, Section 11 Water Metering To conform to regulatory drafting rules Schedule B, Section 12 Installation/Removal of meters To conform to regulatory drafting rules Schedule B, Section 13 Location of meters To conform to regulatory drafting rules Schedule B, Section 14 Master water meters To conform to regulatory drafting rules Schedule B, Section 17 Damage to Water Meters To conform to regulatory drafting rules Schedule B, Section 18 Meter testing To conform to regulatory drafting rules Schedule B, Section 26 Water Building service Connection To conform to regulatory drafting rules and segregates water from
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Designated Bulk Fill Station
Section 52 Section 53 Section 54 Section 55 Section 56 Section 57 Section 58 Section 59 Section 60 Section 61 Section 62 Section 63 Section 64 Section 65 Section 66 Section 67 Section 68 Section 69 Section 70 Section 71 Section 72 Section 73 Section 74 Section 75 Section 76
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Schedule B, Section 19 Schedule B, Section 22 Schedule B, Section 27 Schedule B, Section 45 Schedule B, Section 50 Schedule B, Section 51 Schedule B, Section 55 Schedule B, Section 28 Schedule B, Section 29 Schedule B, Section 26 Schedule B, Section 27 Schedule B, Section 31 Schedule B, Section 21 Schedule B, Section 39 Schedule B, Section 30 Schedule B, Section 21 NA Schedule B, Section 36 Schedule B, Section 32 Schedule B, Section 33 Schedule B, Section 34 Schedule B, Section 37 Schedule B, Section 38 Schedule B, Section 40 Schedule B, Section 41
Water Service cross connection and back flow prevention Alternate water supply prohibited Repairs to water building service connection Water Service Pressure Reducing Valves Water Service Control Valves Water Conservation Directives Private Community Systems
wastewater and stormwater To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules a segregates water from wastewater and stormwater To conform to regulatory drafting rules To conform to regulatory drafting rules
To conform to regulatory drafting rules To conform to regulatory drafting rules. Attachment 1 revised reflecting direction from NSUARB in last General Rate Hearing decision. Fire protection Service Pipes To conform to regulatory drafting rules Private Fire Protection To conform to regulatory drafting rules Wastewater/stormwater building To conform to regulatory drafting rules and segregates wastewater service connections and stormwater from water Repairs to wastewater/stormwater To conform to regulatory drafting rules and segregates wastewater building service connections and stormwater from water Discharge into wastewater facilities To conform to regulatory drafting rules and contemplates agreements respecting extra strength discharges Stormwater discharge to To conform to regulatory drafting rules wastewater facility Extra strength discharge To provide for surcharge agreements respecting BOD and TSS Discharge to stormwater system To conform to regulatory drafting rules Wastewater discharge to To conform to regulatory drafting rules stormwater system Swimming pools and spas New section drafted to control discharge into the stormwater system Pretreatment To conform to regulatory drafting rules Food related grease traps Vehicle oil/grease interceptors Sediment interceptors Wastewater reporting requirements Wastewater compliance agreement Monitoring, sampling, reporting Analytical requirements To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules To conform to regulatory drafting rules
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Section 77 Section 78 Section 79
Schedule B, Section 42 Schedule B, Section 43 Schedule B, Section 54
Monitoring access point Spills Offences
To conform to regulatory drafting rules and add requirements To conform to regulatory drafting rules and update emergency contact information To conform to regulatory drafting rules
Reference to Proposed Rules & Regulations N/A N/A Section 66 Section 63 N/A N/A
Reference to Existing Rules and Regulations Schedule B, Section 15 Schedule B, Section 16 Schedule B, Section 30 Schedule B, Section 31 Schedule B, Section 35 Schedule B, Section 48
Change Section Removed Section Removed Addition Addition Section Removed Section Removed
Reason for Change No longer applicable, all HRWC employees supplied with identification Access to customers premises covered under HWRC Act Additional parameters for regulatory control, also control over infilling of Commission property Additional parameters for regulatory control Not under HRWC regulation Liability of Supply is covered under HRWC Act
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APPENDIX 9
tntliaaig'r
Study of an Efficient Funding Mechanism for HRWC

Page 1
XICII7Halifax Water
Study of an Efficient Funding Mechanism for Halifax Regional Water Commission
December 2012
Prepared by Mark Gilbert, PhD
In association with: Halifax Regional Water Commission Staff
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Table of Contents
Glossary.............................................................................................................................................4 Executive Summary............................................................................................................................5 Introduction, Issues and Context ........................................................................................................8 Review of Finance Theory and Practice on Capital Structures, and Debt Limits for Utilities and Municipalities ....................................................................................................................................9 Introduction................................................................................................................................ 9 AWWA Fundamentals of Water Utility Capital Finance................................................................ 9 InfraGuide: Innovations and Best Practices ............................................................................... 11 Water Environment Federation (WEF) Manual of Practice ........................................................ 11 GFOA Best Practice Debt Management Policy ........................................................................... 14 GFOA Benchmarking and Measuring Debt Capacity .................................................................. 15 Standard & Poors Methodology for Rating Local Governments ................................................ 16 Summary of Literature Reviewed .............................................................................................. 18 Review of Capital Structure and Debt Limit Policies for Other Providers of Water, Wastewater, and Stormwater Services ........................................................................................................................19 Introduction- Overview of Policy Review Findings.............................................................................19 Canadian Municipalities ............................................................................................................ 20 Canadian Provinces and Municipal Finance Authorities ............................................................. 20 American Cities and Regional Water Districts............................................................................ 21 Canadian LGEs with Multi-Jurisdictional Operations................................................................. 21 Investor Owned, Regulated Water and Wastewater Utilities..................................................... 21 Debt/Equity Ratios for Group A Water Utilities ......................................................................... 22 Conclusions............................................................................................................................... 22 HRWC Long Term Capital Requirements and their impact on Efficient Capital Structure and Debt Limit Considerations.................................................................................................................................23 Introduction.............................................................................................................................. 23 Future Capital Infrastructure Requirements (IRP)...................................................................... 23 General Requirements for an Efficient Funding Mechanism for HRWC ...................................... 24 Review of Finance (Recovery) Policies that Impact on Long Term Capital Requirements............ 24
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Review of Trends in Senior Government Support for Capital Projects........................................ 25 HRWC Funding Options, Considerations and Analysis........................................................................25 Overview .................................................................................................................................. 25 Funding Options Available (Non-Debt) ...................................................................................... 26 Capital from Operating Revenues (rates) ...................................................................... 26 Depreciation Funds....................................................................................................... 26 Reserves Funds ............................................................................................................. 26 Proceeds from sales of Capital Assets ........................................................................... 27 Special Levies................................................................................................................ 27 Regional Development Charges (development fees)...................................................... 27 Intergovernmental Transfers ........................................................................................ 28 Funding Options Available (Debt).............................................................................................. 28 Considerations in selecting the mix of options - Intergenerational issues .................................. 29 Debt Limit Considerations......................................................................................................... 29 NSMFC29 HRM guarantee of HRWC debentures........................................................................... 30 Provincial Borrowing guidelines and restrictions on HRWC and HRM capital borrowing / guarantees. .................................................................................................................. 30 Analysis of funding options using IRP data ................................................................................ 31 Sensitivity analysis on interest rates and loan amortization periods .......................................... 34 Summary .................................................................................................................................. 34 Recommendations ...........................................................................................................................34
List of Appendices
Appendix A Summary Highlights of Debt Management/Capital Structure Policies Appendix B Summary of the Evaluation of Funding Mechanism Alternatives Appendix C Detailed Information on Each of the Funding Mechanism Alternatives Appendix D Study Terms of Reference Appendix E Bibliography Appendix F Consultants Short Biography
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Glossary
AWWA CCC CCME COSS GO HRM HRWC IRP LGE LIC NSMFC NSPUA NSUARB O&M PE PPE RDC RWWFP R&Rs SDC SW WEF WW WW CCC American Water Works Association Capital Cost Contribution Canadian Council of Ministers of the Environment Cost of Service Study General Obligation Halifax Regional Municipality Halifax Regional Water Commission Integrated Resource Plan Local Government Enterprise Local improvement charge Nova Scotia Municipal Finance Corporation Nova Scotia Public Utilities Act Nova Scotia Utility and Review Board Operations and Maintenance Population Equivalent Per Person Equivalent Regional Development Charge Regional Wastewater Functional Plan Rules and Regulations System Development Charge (Water Environment Federation) Stormwater Water Environment Federation Wastewater Wastewater Capital Cost Contribution
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Executive Summary
The purpose of the study is to recommend an efficient funding mechanism for the Halifax Regional Water Commission that will enable it to implement the $3.7 Billion in capital projects recommended in the HRWC Integrated Resource Plan (IRP) over a thirty year period. The projects in the IRP cover three service areas; water, wastewater, and stormwater and fall into one of three driver categories; i.e. asset renewal, growth, and compliance. The Nova Scotia Utility and Review Board (NSUARB) directed HRWC to undertake the study. The study terms of reference include a review of finance theory and practice on capital structure for utilities and municipalities; policies of other water, wastewater utilities; and HRWC long term capital needs. Identifying and analyzing options for a funding mechanism which is fair to present and future ratepayers is also included. There is also a requirement to recommend an efficient funding mechanism that is suitable for HRWC and its ratepayers and compatible with the municipal finance and governance framework that exists in Nova Scotia. Section 3 on finance theory and practice provides an extensive literature review which covers information sources ranging from professional association manuals, practices and publications to rating agency methodologies and reports. Six key points are highlighted. These key points relate to the difference in capital financing considerations for investor owned and government owned utilities; the importance of rate affordability, stability and equitable allocation of costs to current and future users when developing municipal debt policies; debt issuance approval entities and their requirements, and the most common methods used in assessing municipal capacity to borrow . In Section 4, the capital structure and debt limit policies for providers of water, wastewater and stormwater services are reviewed. The review includes Canadian municipalities, American cities and regional water districts, Canadian local government enterprises with multi-jurisdictional operations, and investor owned regulated water and wastewater utilities. The loan approval criteria set by Canadian provinces and municipal finance authorities responsible for approving and / or providing capital loans is also discussed. The review identifies a high degree of debt policy / capital structure similarity within particular groupings or governance structures (i.e. Canadian municipalities, Canadian provinces, American cities and water districts, investor owned utilities) and a number of differences between these groupings. Investor owned regulated utilities tend to use more debt in their capital structures in order to maximize shareholder returns and are willing to accept the trade-off of lower credit ratings. Canadian municipalities and their provincial regulators are concerned with the portion of the municipal / municipal enterprise budget that is being used to service debt and favour debt service ratios as the main debt limit measure when establishing borrowing limits. American municipalities and municipal enterprises are more likely to use measures that link debt to property values as the key indicator. Revenue coverage ratios for individual services are also used. American water companies vary widely in the portion of debt used in their capital structures. Section 4 concludes by placing HRWC within the context of the research as a Canadian municipally owned water, wastewater, and stormwater utility. Although this review has identified a number of options that presently exist for establishing a capital structure and debt policy for water, wastewater, and stormwater service providers, the adoption of guidelines that conform with those accepted by Canadian municipalities, provinces and municipal financing authorities would be the most logical and
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beneficial approach for HRWC. Limitations and restrictions on HRWC options resulting from Provincial or NSMFC borrowing limits and HRM debt and debt guarantee policies are covered in more detail in Section 6 of the study. Section 5 considers the capital requirements identified in the recently completed Integrated Resource Plan (IRP). The IRP has identified an infrastructure expenditure requirement of $3,753,242,315 for the period 2013-14 to 2042-43. The thirty year NPV (net present value) of this investment in infrastructure is calculated to be $2,592 million; with $1,860 million (71.8%) allocated to wastewater, $615 million (23.7%) to water, and $117 million (4.5%) to stormwater. The Integrated Resource Plan separates the capital expenditure into three categories which they refer to as drivers. The largest driver is identified as asset renewal and has a 30 year NPV of $1.487 billion or 57.38% of total expenditure. The other two drivers are growth at $503 million (19.42%) and compliance with a cost of $601 million (23.2% of total). The IRP provides a yearly breakdown of capital expenditures by project and category. This information is used to develop and analyze HRWCs funding options in Section 6. For financial modeling purposes, the IRP breakdown of capital expenditures by project was adjusted to reflect multi-year project delivery schedules for some of the projects. Section 5 identifies the three general requirements that the recommended funding mechanism must meet in order to be considered acceptable. They are as follows: 1. 2. It must provide rate stability and affordability to those using HRWC services. It must promote HRWC long term financial sustainability as measured by generally accepted financial measures and ratios, such as the debt service and debt/equity ratios that reflect industry standards and guidelines for a regulated municipal enterprise in the Province of Nova Scotia. The allocation of costs to current and future users must be equitable. This allocation is commonly referred to as inter-generational equity.
3.
Section 6 identifies funding options available to HRWC. In selecting and evaluating options, the three general requirements that an acceptable funding option must meet are considered. An important equity consideration is that consumption of capital infrastructure by the present generation not be at the expense of future generation and conversely that future users not benefit from capital infrastructure without making a financial contribution toward its cost. Two of the approaches to financing infrastructure are pay- as- you- go (capital from operating revenues or if applicable, depreciation funds generated) and pay-as you-use (through debt service charges on long term borrowing) with the third option being a combination of the two. The hybrid approach addresses the intergenerational equity issue by borrowing for large scale projects such as water and sewage treatment plants that occur infrequently and financing ongoing capital expenditures such as water, wastewater, and stormwater line replacements and system upgrades and improvements through depreciation funds and capital out of revenues from current taxes and rates. Two requirements must be met for the hybrid approach to meet its objectives. First the term of the borrowing should be structured so that it does not exceed the life of the asset but is as close to the asset life as permitted by prescribed accounting regulations and responsible debt management practices. In December 31, 2012
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this way, those benefitting from the asset at various times over its useful life will contribute to its cost. Secondly, system replacements and upgrades which are carried out on an ongoing basis should be financed from depreciation funds and capital out of revenues within a set and acceptable annual range of capital expenditures. Section six identifies any restrictions applying to HRWC that would prevent or limit a hybrid approach and these are taken into account when evaluating options. The IRP data was used to evaluate eight funding mechanism options. The evaluation was undertaken with the aid of a modified version of the Debt Affordability Model developed by the Nova Scotia Municipal Finance Corporation (NSMFC) to assist local governments in capital planning and affordability assessments. The evaluation criteria used in measuring the three general requirements was quantified and each alternative was assessed. Under rate stability and affordability the two measures are the utility bill as a percent of median household income (which should not exceed 4-5%) and a steady increase in rates (rather than sporadic upward and downward rate shifts) to finance the capital program. Financial sustainability is measured by the debt service ratio (35% maximum and 30% or less preferred), the debt to operating revenue ratio (currently 148%), the debt to equity ratio (or debt to capital assets under management) with a 35%-50% range for the debt portion, and an accumulated surplus / deficit position as a percent of annual revenues (5% limit). The equitable allocation of resources is measured by the match between drivers and funding sources. These measures are supported by the literature and summaries provided in earlier sections of the report. The eight alternatives were selected by starting with the status quo or `base case sources and amounts of non-debt revenue and financing the difference between the capital expenditure requirement and non-debt revenues available through borrowing (debt). This base case did not meet the three general funding mechanism requirements as the financial ratios were well beyond acceptable best practice and regulatory ranges. The heavy reliance on debt did not match closely with the allocation of expenditures by driver; i.e. asset renewal, growth and compliance). It was also the least affordable of the options considered. The additional seven alternatives all include an increase in depreciation funds through the inclusion of depreciation on existing donated assets. Alternatives four to eight provide for grant funding of up to twelve percent of the cost of the IRP from federal and provincial governments. The amount of funding generated through regional development charges varies among the alternatives from status quo to full cost recovery. The alternative (#6) that recovers the full cost of growth through the regional development charge ranks highest in meeting all three requirements, as identified in this study, and is therefore recommended. The household bill as a percent of household income peaks at 1.73% during the thirty year period and is 1.43% in 2042-43. This compares favourably with the results of the affordability research presented in Section 3 which identifies 4 to 5% as an upper limit. The preferred upper limit for this study is one at the lower end of the range to make allowance for the variations in before- tax and after-tax incomes. The debt service charges peak at 24% which is well below the 35% maximum acceptable rate used in the study. The debt to annual revenue ratio peaks at 242% in 2023-24 and is estimated at 60% at the end of the thirty year period. The maximum debt to capital under management ratio is 38%. The equitable allocation of costs to current and future users for alternative 6 is favourable. However, there are external factors that may result in resistance to an increase of this magnitude in RDC revenues; especially in the short term. If Alternative 6 is not accepted, or delayed, after further consultation with stakeholders and consideration by the NSUARB, the next best options (in order) are alternatives 8 and 7 December 31, 2012
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followed alternatives 5 and 4. All of these options satisfy the minimum requirements for long term financial sustainability and rate stability and affordability. The cost allocation is less equitable as a portion of growth is funded through borrowing, which is repaid through general rates, rather than funded exclusively by RDCs on properties benefiting directly from the capital expenditures.
Introduction, Issues and Context

On December 17, 2010 the Nova Scotia Utility and Review Board rendered a decision on an application by Halifax Regional Water Commission (HRWC) for Approval of a Schedule of Rates and Charges and Schedules of Rules and Regulations for the Provision of Water, Public and Private Fire protection, Wastewater and Stormwater Services.1 The application included a Capital Debt Policy which the Board was not prepared to approve stating it did not accept the 30/70 debt to equity ratio included in the debt policy to be an efficient one. The Board directed HRWC to undertake a complete study which examines an efficient capital structure, policies of other utilities, its longer term capital needs, and options that would result in an efficient funding mechanism which is fair to present and future ratepayers. As a local government enterprise (LGE), there are a number of factors that must be considered when determining debt guidelines and efficient funding mechanisms for HRWC. The methodologies used to determine component and optimal costs of capital for corporately owned utilities are different from municipally owned utilities which do not raise capital through the issuance of common and preferred shares. Inter-generational equity is an important consideration in formulating municipal debt policies which are also influenced by provincial government laws and regulations as well as professional standards and guidelines. In Nova Scotia municipal debt is acquired through the Nova Scotia Municipal Finance Corporation (NSMFC) and information on the NSMFC is presented in section 6 of this report. There is an approval and issuance process, which includes both NSMFC and Service Nova Scotia and Municipal Relations, which must be followed by all borrowers. The impact of HRWC debt on HRM debt limits and policies as well as the current NSMFC requirement that HRM guarantee most of HRWCs debt is also a consideration in the development of an efficient capital structure. On March 11, 2011 the NSUARB approved the Terms of Reference for the Debt Study (Matter No. M03955), and commented that the Board finds the Terms of reference to be thorough and well thought out. The Terms of Reference for the Debt Study are shown in Appendix D. The study focuses on the four areas identified in the Board Order and concludes with a recommendation for an efficient funding mechanism that is fair to present and future ratepayers. The context for the recommendation is one that applies to a local government enterprise providing water, wastewater, and storm water services in Nova Scotia.
NSUARB-W-HRWC-R-10 2010 NSUARB 244
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Review of Finance Theory and Practice on Capital Structures, and Debt Limits for Utilities and Municipalities
Introduction
This literature review covers eight information sources ranging from professional association manuals, practices, and publications to rating agency methodologies and reports. The information relevant to capital structure and debt limits for water / wastewater utilities and local governments is summarized for each report. I have also drawn on my experience in this area when reviewing the results and added comments that link the topics to HRWC where appropriate.
AWWA Fundamentals of Water Utility Capital Finance

Fundamentals of Water Utility Capital Finance: manual of water supply practices. Third Edition 2008. American Water Works Association (AWWA)
The manual strongly supports the Associations statement of policy that the public is best served by revenue enterprises that are adequately financed by rates based on sound engineering and economic principles and that do not require subsidies from other entities.2 With respect to HRWC, rates should be sufficient to finance the Commissions operating expenditures, but it is important to recognize that the cost of meeting mandated regulatory standards exceeds the amount many municipalities find affordable. Grants from other governments are important if rate increases are to be minimized and / or capital projects undertaken through the leveraging of additional funds. The market access and conditions section3 deals with accessing markets and the factors that influence financial decisions such as the shape of the yield curve, general investor sentiment and the state of the financial markets. In HRWCs case, financing through the NSMFC mitigates many of these risks for HRWC. Capital financing considerations for investor owned utilities differ from those of government owned utilities.4 When choosing a capital financing plan, investor owned utilities must consider the availability of equity both common and preferred in a generally more rigid regulatory environment, as well as the impact of income and property taxes. Investor owned utilities, unlike government owned utilities, have the ability to attract equity capital in a competitive market place.5 Capital financing information from chapters 2 and 6 are summarized in the following tables. AWWA Internal Sources of Capital Financing6 Government Owned Utilities Investor Owned Utilities
Fundamentals of Water Utility Capital Financing: manual of water supply practices. Third Edition 2008. American Water Works Association (AWWA) p. 13 3 Ibid p. 35 4 Ibid Chapter 6 5 Ibid p. 69 6 Ibid taken from information in Figures 2-1 and 6-1
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Cost reductions / cost avoidance

Page 10 Depreciation accruals & retained earnings Depreciation Deferred taxes Construction work in progress Replacement policy Return on investment Infrastructure surcharges AWWA External Sources of Capital Financing7
Revenue enhancements (interest revenue) Depreciation Inter-enterprise or municipal agency loans
Government Owned Utilities Debt - short term and long term Leasing Contributions (cost recovery from new users) Grants Tax benefit districts
Investor Owned Utilities Debt - long term & short term Equity - common stock and preferred stock Contributions in aid of construction
The appropriate capital structure for investor owned utilities (Illustrated in Table 6-1 of the manual) is a similar percentage allocated for debt and equity / retained earnings with minimums and maximums for long term debt set at 33% and 60% and at 35% and 65% for common stock / retained earnings. Chapter Three focuses on evaluating financial alternatives. The summary section8 wraps up the discussion by observing that when evaluating alternative methods of financing capital expenditures, a utility will need to consider the legal and financial environments in which it operates, as well as the advantages and disadvantages of the various forms of financing that are available. In making a selection, the utility will want to consider not only its financial capacity but also the public acceptability of the various alternatives. How the various alternatives will affect the utilitys future financial flexibility and how they fit with its longer term financial strategy are also important considerations.
7
Ibid taken from information in Figures 2-2 and 6-1 HRWC sources of external funding are similar to these; with the exception of tax benefit districts and the use of additional development related charges 8 Ibid p.43
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InfraGuide: Innovations and Best Practices

InfraGuide: Innovations and Best Practices: National Guide to Sustainable Municipal Infrastructure: Water and Sewer Rates: Full cost recovery (March 2006)
The guide identifies four approaches for capital financing; i.e. reserves, capital from current, debt and private sector financing, plus a catch all9. The best practice for the development of a financing plan for infrastructure investment involves using capital reserves, capital funding from current revenues and debt in a combination that assumes adequate funding while achieving a reasonable degree of rate stability and an equitable allocation of costs to current and future users.
Water Environment Federation (WEF) Manual of Practice

Financing and charges for wastewater systems. Water Environment Federation (WEF) Manual of Practice No. 27 (USA) 2004
The WEF Manual refers10 to the uses of a capital financing policy to specifically identify the types of facilities that can be readily financed with different types of capital financing resources available to the utility. The policy serves to identify when internal versus external financing sources would be used. One example is a situation where $1,000,000 worth of pipeline is replaced every year, and here the recommendation is that it is more appropriate to build a one million dollar per year allowance into wastewater rates for this program (internal financing) rather than issue bonds. Another example is the construction of a new wastewater treatment plant with a useful life in excess of 20 years, and here the recommendation is to issue bonds (external financing) for this type (large and infrequent) of capital project. The point is made that for a wastewater system that is a component unit or an agency within a municipality, existing city-wide capital financing policies may have direct applicability and should be considered in the development of a utility specific set of financing policies. This Manual also provides sample financing policy statements11. Many of these policy statements focus on the more costly revenue bonds which are popular in the United States as the approval to issue process is simpler and the approval more certain than with the issuance of general obligation bonds. Sample policy statements identified in the Manual that are relevant to the Canadian context include: 1. Bonds cannot be issued for a longer maturity schedule than a conservative estimate of the useful life of the asset to be financed 2. Long term borrowing will be confined to capital improvements 3. Non capital furnishings and supplies will not be financed from bond proceeds 4. The utility will minimize the use of one-time revenue to fund programs incurring ongoing costs
9
Infra Guide: Innovations and Best Practices: National Guide to sustainable municipal infrastructure: Water and Sewer rates: Full cost recovery. March 2006 p.28 10 Financing and charges for wastewater systems. Water Environment Federation (WEF)Manual of Practice No. 27 (USA) 2004 p.65 11 Ibid Table 4-3 p.66
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5. The utility should combine a pay-as-you-go strategy with long term financing to keep the debt burden sufficiently low to merit higher bond ratings and to provide sufficient available debt capacity in an emergency 6. The utility limits debt to projects that cannot be reasonably funded in a single year and to terms that are consistent with the useful life of the project being undertaken 7. The utility will seek the least costly financing available. All debt commitments are reviewed by the treasurer, who looks for opportunities to combine issues or for alternative methods that will achieve the lowest possible interest rates and other borrowing costs. The Manual identifies a number of sources of external financing. These are included in WEF Table 4.2 shown below. When discussing equity 12 it observes the financing of capital improvements via equity funds generally represents contributions made by the owners of the wastewater system. In a publicly owned wastewater system, equity contributions would take the form of accumulated cash generated via the assessment of user charges. In this context, equity is no different than user charges. From an HRWC perspective equity could also include developer installed infrastructure that is built and transferred to a municipality / municipal utility at no cost. This developer financed infrastructure represents a significant portion of HRWC infrastructure. However, for an investor owned utility, equity funds may take the form of common and preferred stock issued by the company or direct equity contributions. In terms of priority, dividend payments on equity capital are generally subordinate to the payment of principal and interest on long term debt. Accordingly, equity funds are typically more expensive and require a return greater than the cost of debt financing.
WEF List of Internal and External Capital Financing Sources13

Internal Rates or user charges Equity Special assessments (to finance the installation or replacement of collection facilities for the benefit of a defined area) Ad valorem (property) taxes Cost reductions Grants Contributions (from new development; either in cash or infrastructure needed for development) External Debt Equity System development charges
12 13
Ibid p.60 Ibid table 4.2
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Depreciation

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Specific financing considerations for investor owned utilities are identified in the Manual14. The two most significant differences in capital financing techniques from municipally owned systems are the use of debt and equity funds and the applicability, or use of, system development charges (SDCs and also referred to as impact or development fees). Because of considerations regarding overall capital costs, most investor owned utilities would typically maintain a debt-to-total capitalization ratio in the order of 50 to 60%. This level of capitalization would not be unusual for an investor owned public utility. A ratio higher than 60% may be an indication that the utility is carrying too great a debt (too highly leveraged). Debt ratios lower than 50% might be an indication of an unreasonable use of more expensive equity capital. For investor owned utilities, SDCs are excluded from the rate base and in determining revenue requirements through depreciation expenses, as they were obtained using no-cost financing. The following table summarizes the main capital financing sources identified in the literature. It highlights the similarities and differences between government and investor owned utilities and identifies the range of funding mechanism options available for consideration by utilities providing water, wastewater, and stormwater services.
Combined List of Capital Financing Sources15

Government Owned Utility Internal Rates or user charges Ad valorem (property) taxes Special assessments Cost reductions Investor Owned Utility Internal Rates or user charges Infrastructure surcharges Depreciation Deferred taxes Leasing Contributions Government Owned External Debt: long & short term Equity Investor Owned External Debt: long & short term Equity common and preferred stock Leasing Contributions in aid of construction Depreciation Reserves Replacement policy Retained earnings Grants System development charges System development charges
14 15
Ibid p.64 Adapted from information contained in AWWA Figures 2-1, 2-2,6-1,6-3 and WEF Table 4.2
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Inter-enterprise or municipal agency loans

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The WEF manual also addresses the issue of affordability and refers to a study conducted by the National Consumer Center for the American Water Works Association Research Foundation. The study, while primarily focused on affordability of water charges, also addresses the affordability of wastewater charges. In the report, affordability of user charges is stated to be 2% of average user, median income households each for water and wastewater; i.e. 4% for both utility services (Saunders et al. 1998)16 The manual also refers to a range of 2.3% to 3% of MHI for combined water wastewater bills used by the Ohio Public Works Commission in 1999. As standards have become more, rather than less, stringent since the Saunders study was undertaken, the 4% could now be viewed as the lower end of the affordability range.
GFOA Best Practice Debt Management Policy

Government Finance Officers Association (GFOA) of the United States and Canada. Best Practice Debt Management Policy (1995 and revised in 2003)
The GFOA develops and updates best practices in several areas of local government finance. The GFOA debt management policy was originally developed in 1995 and updated in 2003. The best practice covers debt limits, use of derivatives, debt structuring practices, debt issuance practices, and debt management practices. As HRWC issues debt through the NSMFC the most useful information in this best practice is in the areas of debt limits and debt structuring. The GFOA best practice on debt limits states that limits are generally established for legal, public policy and financial reasons. The factors related to each component are provided below.17 Legal limits may be determined by state /province constitution or law, or local charter, by-laws, resolution, ordinance, or covenant. Public policy limits can include Purposes for which debt proceeds may be used or prohibited Types of debt that may be issued or prohibited Relationship to and integration with the capital improvement program Policy goals related to economic development, capital improvement financings, and tax increment financing and public private partnerships.
Financial limits generally reflect public policy or other financial resource constraints. Financial limits are often expressed as ratios customarily used by credit analysts. Different financial limits are used for
16 17
WEF Manual of Practice #27 p.222 GFOA Best practice debt management policy p.2
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different (direct, revenue, conduit, short term) types of debt. Direct (or general obligation) debt, which is the type issued by both HRM and HRWC, can be measured or limited by the following ratios: Debt per capita Debt per customer Debt to personal income Debt to taxable property value, and Debt service payments as a percentage of general fund revenues or expenditures
Debt structuring practices should be reflected in the policy for each type of bond, including: Maximum term (often stated in absolute terms or based on the useful life of the asset(s) Average maturity Debt service pattern such as equal payments or equal principal amortization Use of optional redemption features that reflect market conditions and / or needs of the government Use of variable or fixed rate debt, credit enhancements, derivatives, and short-term debt, and limitations as to when each can be used, and Other structuring practices should be considered such as capitalization of interest, deferral of principal and/or other internal credit support, including general obligation pledges
GFOA Benchmarking and Measuring Debt Capacity

Government Finance Officers Association (GFOA) of the United States and Canada. Benchmarking and measuring debt capacity. Miranda and Picur (2000)
The GFOA publishes books and guides for finance professionals. The most recent GFOA book on measuring debt capacity was published in 2000. The value of this publication is that it both identifies key debt burden measures and provides a sampling of these measures for GFOA member cities with populations of 25,000 or more. Debt outstanding and debt service costs are identified as the two main debt burden measures. In keeping with the general municipal approach to debt management, the focus is on debt burden relative to the local economy and a municipalitys ability to meet its debt obligation rather than on capital structure. Two ratios are recommended when measuring debt outstanding; i.e. general obligation debt as a percent of fair market value of taxable property and general obligation debt per capita. The GFOA sample municipal data published in 2000 showed a 2% to 10% range for the first ratio and a $200 to $1300 range for debt per capita. Four indicators are provided for measuring debt service; general obligation (GO) debt as a percent of general fund revenue, GO debt as a percentage of budgeted expenditures, GO debt service per capita December 31, 2012
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and GO debt service as a percent of personal income per capita. Sample data is not provided for these indicators.
Standard & Poors Methodology for Rating Local Governments

Standard & Poors Methodology for rating international local and regional governments (LRGS). September 20, 2010
One of the elements used when evaluating municipalities covered by S&Ps rating methodology is assessing the debt burden. This element is directly related to efficient capital structure and debt limit research. Other areas assessed are institutional framework, the local economy, budgetary performance and flexibility, liquidity, contingent liabilities and financial management. The methodology includes a one to five point scale for rating individual municipalities on each descriptor. The debt burden assessment focuses on three factors; i.e. a forward looking assessment of debt stocks and interest burden; potential volatility on the cost of debt from exposure to market risk; and an assessment of other long term liabilities (mostly unfunded pension liabilities). When undertaking a forward looking debt burden assessment, the ratio of tax supported debt to consolidated operating revenues is identified as the most appropriate measure for international comparison. The second ratio analyzed is interest to adjusted operating revenues (the share of revenue used to cover the interest portion of cost of debt). An exposure to market risks assessment focuses on interest rate and currency risks, along with the use of derivative instruments. The debt maturity profile is also a consideration as a short term amortization profile is more sensitive to interest rate fluctuations. Other long-term liabilities focus on pension liabilities, where they exist, which are a major item in this category and may affect the credit quality of LRGs. Unfunded pension liabilities are considered to be debt like in nature in defined benefit pension systems. They also include other contingent liabilities such as guarantees, public-private-partnerships, litigations, and unfunded post-employment benefits. When applying the five point scale, where low points are preferable, to the debt burden assessment the two factors used 18 are interest as a percent of operating revenues (where over 9% is considered the least favourable category) and tax supported debt as a percent of consolidated operating revenue (where over 180% is identified as the least favourable). The Standard & Poors methodology for the assessment of debt management 19 considers a LRGs policies around the use of short and long term debt as well as exposure to debt related risk. A one point (best) score would apply to a LRG with a prudent debt management policy where all debt is issued for
18
Standard & Poors. Methodology for rating international local and regional governments (LRGS) September 20, 2010. Table 21 p.42 19 Ibid Table 12 p.25
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capital purposes and debt levels are below national limits and risk is minimized. A five point (worst) score occurs in the absence of effective debt policies, where long term debt is used to cover liquidity needs, debt limits are regularly breached, the use of derivatives and high exposure to interest-rate and currency risk.
Standard & Poors. Global Credit Portal: Ratings Direct. Halifax Regional Municipality. April 5, 2011
The most recent HRM credit rating provided by Standard & Poors assigns an AA- Stable rating to the municipality. There were five major rating factors identified; three as strengths and two as weaknesses. The strengths were strong liquidity, healthy budgetary performance, and steady economic performance. The weaknesses were limited financial flexibility and negative after capital operating balances. Two financial indicators are used to measure debt burden. The first is municipal debt (which includes capital leases and HRWC debt) as a percent of operating revenues which currently is 62.1% for HRM. Standard and Poors project that total municipal debt will remain stable at about 60% - 65% of operating revenues until the end of fiscal 2013 and comment that Halifaxs debt burden is in the middle of its peer group and well below the median of similarly rated entities. (This comment is consistent with the information contained in the S&P methodology for rating international local and regional governments 2010). The report notes that HRWC currently accounts for 37.5% of HRMs $409 million direct debt.20 The second financial indicator is debt service to operating revenue which is currently at 7.6%. This ratio has been on a downward trend during the five years covered by the S&P statistics. A reduction in interest rates, as well as increasing operating revenues, would have contributed to this trend line.
Standard & Poors. June 8, 2011 meeting with S&P in Halifax to discuss rating criteria, financial ratios, and the link between HRWC debt and the HRM credit rating.
Standard and Poors consolidate all financial information, including HRWCs revenues and outstanding debt, when undertaking a credit rating assessment. An increase in HRWC use of financial leverage through a higher debt to equity ratio would have an impact in HRMs credit rating at some point. As a result of a recent review of the eight factors used to examine a municipality, the rating agency is putting a greater emphasis on liquidity and less emphasis on the amount of debt outstanding. Debt is assessed against revenue and not equity. When discussing the capital financing policies of other Canadian municipal water / wastewater systems the emerging trend is to finance this infrastructure through rates (capital from operating budget) rather than issuing debt. This approach increases municipal capacity to borrow to finance infrastructure required in the provision of other municipal services. However, if all water and wastewater infrastructure, including high cost, long life treatment plants, is financed through rates inter-generational equity issues can result.
20
Standard & Poors. Global Credit Portal: Ratings Direct Halifax regional Municipality. May 15,2011 p.8
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Summary of Literature Reviewed

The keys points are as follows. 1. Capital financing considerations for investor owned utilities differ from those of government owned utilities. The main reason for this difference is that it is advantageous, in terms of tax savings and return on equity, for investor owned utilities to use more debt in their capital structures. These advantages result from the tax deductibility of interest costs for private companies and the use of debt leverage as a method of increasing the return on shareholder equity. The AWWA and WEF both recommend ranges (which are 33-60% and 50-60% respectively) for the amount of debt appropriate for investor owned water utility capital structures. Heavier reliance on impact (development) fees by investor owned utilities is also referenced in the literature. 2. Leveraging debt to improve returns to shareholders is not a consideration when developing capital structure and financing arrangements for government (municipal) owned utilities; nor is interest rate deductibility for income tax purposes. The main considerations are rate affordability and stability and factors that influence municipal debt policies. An equitable allocation of costs to current and future users (inter-generational equity) is a related consideration in a capital intensive municipal enterprise. 3. Factors influencing municipal capital structure and debt decisions are legal, public policy and financial limits, some of which are determined by senior orders of government; i.e. mainly the provinces in the Canadian context. In Nova Scotia the Minister responsible for local government, under the authority of section 88 of the Municipal Government Act approves municipal capital borrowings and under the authority of section 86 establishes borrowing limits. In the past decade, federal regulation, standard setting and compliance requirements for water, wastewater, and storm water treatment has resulted in significant increases in investment in municipal infrastructure and had a significant impact on water and wastewater rates. 4. The two most common areas of focus when assessing a municipalitys capacity to borrow are (1) the measurement of its existing (or projected) level of debt outstanding against its own source revenues (taxes or taxes and rates) or its revenue base (taxable property) and (2) the ratio of annual debt service costs to annual operating revenues. The tax supported debt to operating revenue ratio is identified by Standard and Poors as the most appropriate measure for international comparison and the rating agency now places greater emphasis on liquidity. HRMs 62.1% ratio of debt to own source revenue is considered to reflect a moderate debt burden and is presented as a weakness in HRMs credit rating assessment. This ratio would fit into the middle range on the rating agencys international five point scale. The HRWC stand-alone debt to revenue ratio is 148% which would put it on the higher debt burden side of the scale. However, water and wastewater are capital intensive services funded through rates, not taxes, so a higher debt burden is not unexpected. December 31, 2012
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5. The debt service to operating revenue ratio can be calculated in one of two ways. In some cases only interest is included in the debt service amount and in others both interest and annual principal payments (on serial issues or to sinking funds) are included. The method commonly used by Canadian municipalities is to include both interest and principal payments. HRMs consolidated debt service ratio is 8.7% and HRWCs stand-alone debt service ratio is 21.5% which reflects the capital intensive nature of the service it provides. 6. Debt to equity ratios are primarily of concern to investor owned utilities due to the opportunities that exist for financial leverage and interest deductibility and the literature suggests a fifty per cent debt allocation in the capital structure with minimums and maximums. The debt portion of the debt to equity ratio of HRWC is in the area of 20%-25%. Donated assets which make up a large percentage of HRWCs utility plant in service are included in the total capitalization figures. In conclusion, the literature reviewed suggests a municipally owned water/wastewater utility providing service in its home municipality should select a capital structure and debt limits that reflect a focus on enhancing rate affordability and stability. These enhancements are subject to the factors and constraints, which include senior government legislation and regulation that influence and restrict the municipalitys debt policy. The two most appropriate financial criteria used in determining and evaluating capital structure and debt limits for a municipality and its enterprises are ones that measure debt service charges to annual operating revenues and total outstanding debt to either annual revenues or the property tax base. It is also useful to use an indicator that relates debt to the communitys ability to pay and the link between debt and taxable property is a suitable indicator. The next section of the study includes a survey of the debt limits and capital structures adopted by water, wastewater, and stormwater service providers. Its primary focus is on municipalities and municipally owned water, wastewater, and stormwater systems.
Review of Capital Structure and Debt Limit Policies for Other Providers of Water, Wastewater, and Stormwater Services
Introduction- Overview of Policy Review Findings
A review of capital structure and debt limit policies adopted by municipalities and other service providers is useful in determining how other utility and municipal policies align with the guidelines recommended by the professional associations, rating agencies, and other specialists. It is also helpful in identifying similarities and differences among utilities with difference governance and ownership structures located in various jurisdictions.
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Canadian Municipalities
The first grouping includes seven Canadian cities that provide water / wastewater services (see Table 1 in Appendix A). These cities represent different regions of the country and like HRM have strong economies and are experiencing growth. All of these cities use a target debt service to revenues (or expenditures) ratio as their main debt limit measure. The ratio limit ranges from 10% in Calgary to 22% in Edmonton with variations on what is included in revenues (e.g. tax supported revenues only, gross revenues) and whether the debt is supported by tax revenues or user fees. Halifax Regional Municipalitys (HRM) focus has been on debt reduction and funding capital expenditures from non- debt sources rather than on a target debt service ratio. HRMs latest debt service ratio as reported by Standard &Poors in 2011 is 8.7%. HRWCs debt service ratio is currently 21.5%. It should also be noted that most Canadian municipalities are well below their approved debt service ratio limits and also below those municipal debt service ratios that are established provincially. There are natural constraints in place that affect Canadian municipalities use of debt, such as the ability to absorb the operating costs associated with new infrastructure, annual operating budget pressures caused by increased debt servicing and depreciation, and sensitivity around increasing rates and tax burden. When the debt policies of these Canadian cities are compared to the appropriate financial measures and ratios recommended in the professional manuals, guides and recommended practices, it can be seen that the Canadian cities rely on one of the two main financial indicators presented in the literature. Six of the Canadian city debt policies focused on the debt service ratio (debt service cost to operating revenues) whereas the ratio of tax supported debt to operating revenue was not a commonly used ratio. The HRM focus has been on reducing the amount of tax supported debt outstanding and Calgary established a tax supported debt per capita limit.
Canadian Provinces and Municipal Finance Authorities

Canadian municipal debt is frequently issued through provincially based municipal finance authorities. These authorities will only provide capital financing to municipalities that meet provincially established debt issuance processes and capital borrowing limits. In addition the MFAs may include additional criteria of their own. Table 2 in Appendix A provides information on municipal borrowing guidelines established by three provinces and the two largest MFAs which adhere to provincial guidelines when making loans to municipalities. In all cases a debt service ratio is used as the primary financial indicator in measuring a municipalitys capacity to borrow. The debt service ratio limit ranges from 25% to 35% and normally there are mechanisms for requesting approval to exceed these limits. The Ontario municipal debt management manual specifies that the debt limit is established on the basis of the annual debt repayment amount, not the principal amount of the debt issued or total value of long term financial obligations. In addition to a debt service ratio limit, Alberta limits the amount of municipal debt outstanding in relation to generated revenues. In the case of the four largest Alberta cities it is twice annual revenues. Borrowings for Saskatchewan cities are approved by the Saskatchewan Municipal Board and the approved limits are stated in dollar amounts not ratios. In summary, the indicators used to assess municipal borrowing capacity by the provinces and MFAs included in the review are similar to the seven Canadian municipalities reviewed above. The debt service ratio is used as the primary indicator and one province / MFA also uses the ratio of outstanding debt to operating revenues as an indicator.
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American Cities and Regional Water Districts

American cities and regional districts providing water / wastewater services are also included in the review (see Table 4 in Appendix A). The selected units include utilities known for good financial management that were recommended by an industry expert. Most of these entities have well developed policies and the others report debt service measures they consider relevant. The American municipalities and their utilities were less focused on debt service ratios than their Canadian counterparts. Four of the seven units used debt to assessed property values as their key indicator, one linked bond service costs to net revenues (debt service ratio), and one focused on financing as much capital from current revenues as possible in order to reduce borrowing requirements. Revenue coverage ratios, calculated separately for each service, were important in two of the cities. The link between debt outstanding and the property values (tax base) is useful in relating debt to the communitys ability to pay and one of the two most common areas of focus in assessing a municipalitys capacity to borrow referred to in the literature. The use of revenue coverage ratios addresses the growing interest in liquidity when assessing financial capacity.
Canadian LGEs with Multi-Jurisdictional Operations

Two Alberta cities have created local government enterprises (LGEs) with multi-function / jurisdictional operations (Appendix A Table 3). These LGEs lean toward capital structures that are a hybrid of the municipal and investor owned utility models. Calgarys ENMAX provides electricity, natural gas, fibre optic, and value added services. It has a debt to capitalization ratio of 43% with shareholder equity providing the remaining 57%. It does not provide water and wastewater services which are provided through a City of Calgary department / business unit. Edmontons EPCOR has three business function; i.e. electricity distribution and transmission in the City of Edmonton, water wastewater services in more than 50 communities (including Edmonton) in Alberta and British Columbia, and energy services in Alberta. A recent study undertaken by Foster and Associates made capital structure recommendations for EPCOR water systems in two British Columbia communities. As these systems are viewed as business investments by EPCOR, business risk was a consideration in the debt / equity split recommendations of 50/50 and 55/45 for the two systems. EPCOR creates separate capital structures for each of its subsidiaries to facilitate efficient tax planning. Although it does not have specific debt service charge limits, it ensures debt coverage ratios are appropriate and uses capital structure and equity rates that are in keeping with its investment grade credit ratings.
Investor Owned, Regulated Water and Wastewater Utilities

Standards & Poors provides credit ratings for a number of investor owned water and wastewater utilities providing regulated services in the United Kingdom and to a lesser extent in the United States where most of these services are provided by municipally owned utilities. These investor owned utilities rely heavily on long term debt in their capital structure in order to reduce the after tax cost of capital and maximize shareholder returns. Their debt to capital ratio is higher than AWWA Class A average referred to below and two of the ten investor owned utilities for which financial information was reviewed, had debt /equity ratios of 88/12. Most of these investor owned utilities had BBB credit
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ratings as a result of high financial leverage ratios. The regulatory and monopoly (or high barriers to entry) features of the industry are factors which permit a high percentage of debt in the capital structure of these investor owned utilities. The credit rating reports focus on cash flows, liquidity, and debt coverage rather than on the portion of operating revenues or expenditures allocated to debt service costs. Municipally owned water utilities are not subject to income tax and are more focused on financial sustainability and credit rating than on capital structure.
Debt/Equity Ratios for Group A Water Utilities

In addition to a review of debt limits, this review is also concerned with capital structure. For purposes of clarification, ratios and figures presented will relate to the split in debt and equity in the capitalization of the entity. The AWWA has undertaken a survey to determine debt and equity ratios for fifty Group A American water utilities21 (Halifax is also Group A). Nearly all American water utilities are municipally owned.22 There is a wide variation is these ratios with the mean debt / equity split calculated as 44/56. This (44/56) is also the median calculation as well. The lowest debt / equity ratio for the fifty utilities is 0.1/99.9 and the highest is 98/2 which demonstrates the magnitude of the variation is capital structure among American Class A water utilities.
Conclusions
The review identifies a high degree of debt policy / capital structure similarity within particular groupings or governance structures (i.e. Canadian municipalities, Canadian provinces, American cities and water districts, investor owned utilities) and a number of differences between these grouping. Investor owned regulated utilities tend to use more debt in their capital structures in order to maximize shareholder returns and are willing to accept the trade-off of lower credit ratings. Canadian municipalities and their provincial regulators are concerned with the portion of the municipal / municipal enterprise budget that is being used to service debt and favour debt service ratios as the main debt limit measure when establishing borrowing limits. American municipalities and municipal enterprises are more likely to use measures that link debt to property values as the key indicator. Revenue coverage ratios for individual services are also used. American water companies vary widely in the portion of debt used in their capital structures. HRWC is a Canadian municipally owned water, wastewater, and stormwater utility. Although this review has identified a number of options that presently exist for establishing a capital structure and debt policy for water, wastewater, and stormwater service providers, the adoption of guidelines that conform with those accepted by Canadian municipalities, provinces and municipal financing authorities would be the most logical and beneficial approach for HRWC. Limitations and restrictions on HRWC options resulting from Provincial or NSMFC borrowing limits and HRM debt and debt guarantee policies are discussed in more detail later in the study.
21
AWWA/RFC 2008 Water and Wastewater Rate Survey Group A Water Utilities Debt/Equity ratios presented in exhibit format at a rate case in Milwaukee, WI on July 19, 2010 22 Standard and Poors Revised Criteria for Rating Water, Sewer and Drainage utility Revenue Bonds, September 15, 2008 p. 3
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HRWC Long Term Capital Requirements and their impact on Efficient Capital Structure and Debt Limit Considerations
Introduction
This section of the report focuses on HRWCs capital requirements as determined by the recently completed Integrated Resource Plan (IRP) and identifies the criteria that must be satisfied when selecting a funding mechanism for capital infrastructure. It also discusses the issue of federal and provincial funding for capital expenditures required to meet the costs of infrastructure renewal and government mandated standards for water, waste water, and storm water.
Future Capital Infrastructure Requirements (IRP)

A municipalitys stage in the development cycle is an important determinant in the demand for new infrastructure and the requirement to replace the existing stock. As the economic hub and growth centre for both Nova Scotia and the region, Halifax is experiencing new commercial and residential growth resulting in a need to expand the services provided by HRWC. On the other hand, the older sections of the municipality have aging infrastructure that requires replacement, upgrading, and compliance with current regulations which include separation of wastewater and stormwater collection lines and enhanced treatment standards. The resultant capital program requirements are contained in the HRWCs Integrated Resource Plan. The recently completed Integrated Resource Plan has identified an infrastructure expenditure requirement of $3,753,242,315 for the period 2013-14 to 2042-43. The thirty year NPV (net present value) of this investment in infrastructure is calculated to be $2,592 million; with $1,860 million (71.8%) allocated to wastewater, $615 million (23.7%) to water, and $117 million (4.5%) to stormwater.
Stormwater $117 million Water 615 million
Wastewate $1,860 million
The Integrated Resource Plan separates the capital expenditure into three categories which they refer to as drivers. The largest driver is identified as asset renewal and has a 30 year NPV of $1.487 billion or 57.38% of total expenditure. The other two drivers are growth at $503 million (19.42%) and compliance with a cost of $602 million (23.2% of total). The non-discounted expenditure by driver is $2.070 billion on asset renewal, $837 million on compliance and $701 million on growth.
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The IRP provides a yearly breakdown of capital expenditures by project and category. This information is used to develop and analyze HRWCs funding options in Section 6. It is important to add that for financial modeling purposes, the IRP breakdown of capital expenditures by project was adjusted to reflect multi-year project delivery schedules for some of the projects. This recognizes the reality of phased capital project delivery and helps smooth the impact of rate and debt requirements.
Smoothed to reflect delivery of multi-year projects
Years 1 - 5 reduced to reflect 5 YR BP and need to increase organizational capacity to get to full IRP spend level
Debt study financial modeling based on $3.6 B Capital Spend
General Requirements for an Efficient Funding Mechanism for HRWC

The recommended funding mechanism must meet the following three general requirements in order to be considered acceptable. 1. It must provide rate stability and affordability to those using HRWC services. 2. Promote HRWC long term financial sustainability as measured by generally accepted financial measures and ratios, such as the debt service and debt to equity ratios that reflect industry standards and guidelines for a regulated municipal enterprise in the Province of Nova Scotia. 3. The allocation of costs to current and future users must be equitable. This allocation is commonly referred to as inter-generational equity.
Review of Finance (Recovery) Policies that Impact on Long Term Capital Requirements
The existing capital cost contribution policy is included in Addendum B of HRWCs Schedule of rates and charges for water, wastewater, and stormwater services which were approved by the UARB
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effective January 1, 2011. The policy is designed to complement HRMs regional planning priorities and encourage development but not to have HRWC accept the financial risk of new development. The cost of new development is cost neutral to existing customers unless there is a benefit to them. HRWC is currently reviewing its capital cost contribution policy on regional services. Staff held public meetings with stakeholders in the fall of 2012 to discuss the implementation of a Regional Development Charge that would be established under a proposed policy that promotes full cost recovery when added development has a financial impact on the provision of regional infrastructure. The funding mechanism options included in this study consider various levels of RDC funding.
Review of Trends in Senior Government Support for Capital Projects

The Federal Gas Tax Transfer to municipalities is the only existing ongoing federally funded municipal infrastructure program in Canada. There have been a number of federal / provincial / municipal cost shared programs during the past decade but they have all ended or are winding down. HRWC access to these funds would be through HRM. The Federation of Canadian Municipalities (FCM) and the Province of Nova Scotia are advocating for federal financial assistance in implementing CCME (Canadian council of ministers of the environment) guidelines and standards. Local governments are also advocating for financial assistance with infrastructure renewal. A meeting23 to discuss the possibility of future federal / provincial shared funding programs for municipal water and wastewater infrastructure was held with senior staff at SNSMR. Wastewater and water projects are eligible for P3 funding under P3 funds remaining in the Build Canada Program. HRWC does not have any pending projects large enough to be viable as a P3 project and attract partners. Additionally, the complexities of initiating a P3 project in a regulated utility environment would be challenging. HRMs current practice is to use its share of the federal gas tax money for purposes other than financing HRWC infrastructure so at present there are no sources of federal / provincial government funds available to contribute to HRWC infrastructure. Recent discussions with HRM senior staff indicate a willingness to support HRWC in obtaining federal and provincial grant funding for HRWC projects. This willingness is as a result of the magnitude of the capital infrastructure investment required to meet HRWCs compliance with environmental standards and its asset renewal needs. Organized local government in Canada, through the Federation of Canadian Municipalities and provincial associations, are actively working with the Federal government to obtain cost sharing for municipal infrastructure projects and develop new programs to replace those that are expiring.
HRWC Funding Options, Considerations and Analysis

Overview
The finance literature identifies a number of funding options available to municipally owned water / wastewater utilities. They are generally well know and understood and are presented in tabular form in
23
June 10, 2011 meeting held with SNSMR staff at Maritime Centre
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section two of this study. For purposes of clarity, the ones most relevant to HRWC are summarized in this section. When recommending and selecting funding options, other considerations such as intergenerational issues, and legislative or regulatory restrictions on debt financing are also taken into account. The roles of three entities that have the ability to influence or restrict HRWC debt limits are also discussed.
Funding Options Available (Non-Debt)

Capital from Operating Revenues (rates) This source of financing involves including funds in the utilitys operating budget to finance capital expenditures during the fiscal year. It is also referred to as capital out of revenues or funding through rates. Capital out of operating revenues is a viable option but it is not one considered by HRWC at this time. HRWC has capital funding through current operating revenues in the form of depreciation on funded assets, and subject to NSUARB approval can introduced depreciation on contributed or grant funded assets. If HRWC does not introduce depreciation on contributed / grant funded assets, the concept of funding capital from operating revenues should be re-examined. Depreciation Funds These funds reflect the cost of using existing assets and, along with capital from operating revenue, provide capital funding from the approved rate structure. Annual charges related to amortizing the assets costs are included in the utilitys annual budget until the cost of the asset has been fully amortized. The source of financing (e.g. capital from revenue, reserves, and borrowing) for the asset itself would be arranged when it was acquired. Revenues generated by the recovery of depreciation charges provide funds for debt repayment or investment in capital assets. Depreciation funding has worked well as a funding source to date for the water system. However depreciation funding for the wastewater and storm water systems is low due to understated asset values and contributed assets that were not included. On a positive note, with significant new wastewater projects such as Harbour Solutions and the Eastern Passage Wastewater Treatment Plant coming on line, capital funding from depreciation from wastewater will grow steadily over the next five years. The NSUARB Accounting and Reporting Handbook for Water Utilities require that utilities maintain a depreciation reserve fund. HRWC has received NSUARB approval for exemption from setting up a depreciation fund as long as the net depreciable additions to plant exceed the depreciation charged. HRWCs annual depreciation is fully utilized to fund capital in any given year. Reserves Funds Reserve funds accumulate when money is set aside in advance of an anticipated capital expenditure. The March 2012 financial statements for HRWC show $19.6 million24 in special purpose reserves for sewer redevelopment, wastewater infrastructure, and stormwater reserves. These reserves are restrictive in nature and are largely the result of the 2007 transfer of wastewater and stormwater services to HRWC. Approximately half of the reserve funds are committed to projects approved in the
24
Financial Statements HRWC March 31, 2012 Note 8 p. 12
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two most recent fiscal years. These reserves will be utilized heavily to fund capital during the next five years and the balances will be drawn down as they are applied to completed projects. It is anticipated HRWCs reserves will decline. The only source of replenishment in the future will be development related charges, which will be used to fund growth related projects. For modeling purposes new allocations to the reserve funds will come from the regional development charge. Proceeds from sales of Capital Assets Provincial legislation, municipal and water utility policies, and professional best practices can all influence decisions made around the use of funds resulting from the sale of a capital asset. Normally these funds are set aside for reinvestment in infrastructure or other capital assets. HRWC occasionally sells surplus land and the proceeds are used to fund capital. Given the finite supply of surplus land this is not expected to be a major source of long term capital funding. Special Levies Special levies are fees that are added on properties served or in the service area of a water utility or municipality. They can be an ad valorem tax based on the assessed value of property, based on frontage / lot size or a flat fee. HRWC does not have the direct legal authority to levy taxes, local improvement charges or area rates. HRM has this authority and currently levies, collects, and remits local improvement charges related to HRWC services. Regional Development Charges (development fees) This source of income was referred to under external sources of capital financing in Section 2 of the study. HRWC presently budgets $3.3 million in annual revenue from regional development charges. This cost recovery for wastewater and stormwater services related to growth was based on regulations permitted under the HRM Charter (formerly in the Municipal Government Act). For water, there was no cost recovery charges related to growth. Since the transfer of the wastewater and stormwater assets to HRWC, all development and growth related cost recovery charges are now subject to NSUARB review and approval. At the time of the transfer of the wastewater and stormwater systems, the NSUARB approved the continued use of the regional based development related charges that were previously established by HRM. These charges are the Sewer redevelopment Charge (SRC), Trunk Sewer Charge (TSC), and the Capital Cost Contribution Charge for Wastewater Treatment Facilities. The collection of regional based charges has been used in developing capacity within regional infrastructure. Essentially, capacity as it exists today is already bought and paid for. A review of existing regional charges for future growth related capital costs is currently being conducted to ensure that HRWC has sufficient funds to implement the necessary regional growth infrastructure. For purposes of this study, scenarios have been prepared which reflect the existing level of development related fees (called Regional Development Charges) and enhanced levels of development related fees. The Regional Development Charge would combine and replace the Trunk Sewer Charge and the Regional Wastewater Capital Cost Contribution. Existing local area capital cost contributions would remain.
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Intergovernmental Transfers Intergovernmental transfers take the form of grants for capital infrastructure. The transfers can be either conditional or unconditional in nature. The recent trend in Canada is to provide some capital cost sharing through the sharing of gas tax revenue and to allocate other funds through sectoral funding agreements which are application driven and typically involve three way cost sharing by federal, provincial and local governments. Post 2000 capital funding programs have included the Infrastructure Canada Program (ICP), the Canadian Strategic Infrastructure Fund (CSIF), the Municipal Rural Infrastructure Fund (MRIF for green infrastructure) and the Building Canada Fund where water and wastewater are two of the five priority funding categories. These programs focus on specific categories of infrastructure over defined time periods and no new projects are being approved under these programs. HRMs current policy is, in light of its own infrastructure needs, to use its annual share of the federal gas tax fund for purposes other than HRWC infrastructure. In its Fall 2011 Pre- (Federal) Budget Submission, the Federation of Canadian Municipalities (FCM) recommends the federal government renew the soon-to -expire Building Canada Fund, index the federal Gas Tax Fund to keep up with rising costs and new growth, and pay the federal share of any new infrastructure costs imposed on municipalities, including the upgrades to meet new federal wastewater regulations.25 The governments acceptance of these recommendations could result in funding for HRWC infrastructure. In June 2012 FCM launched its Target 2014 Campaign calling on the federal government to ensure a new long term infrastructure funding plan is in place before current programs expire in 2014. As of mid-October 2012, 183 Canadian municipalities had passed resolutions in support of Target 2014.26
Funding Options Available (Debt)

The practice among Nova Scotia municipalities and municipal enterprises is to acquire long term financing through the issuance of debentures through the Nova Scotia Municipal Finance Corporation (NSMFC) which was established in 1979. Through a combination of pooling loans and adding credit enhancement through a provincial guarantee, the NSMFC is able to provide funds at competitive long term rates that municipal borrowers would be unable to achieve individually. As of March 31, 2012 HRWC had $59,462,600 in debentures issued to the NSMFC in its own name and $74,138,000 issued by HRM for wastewater / stormwater that are now being serviced by HRWC. The other source of existing debt is an outstanding loan of $13,000,000 from the Federation of Canadian Municipalities Green Fund which funds eligible green projects at interest rates below Government of Canada bond rates. This low cost source of funding is used when opportunities arise. A weighted average cost of debt (WACD) has been calculated for HRWC. This WACD includes debt issued in fiscal 2012-13 and is 4.62%. This figure is used as the basis for calculating the interest cost associated with future borrowing under the options and alternatives that are considered in this study. Sensitivity analysis focusing on the financial implications of movements in interest rates is also undertaken.
25 26
FCM Keep Moving Forward, Pre-Budget Submission Fall 2011 Retrieved from FCM Website October 17, 2012
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Considerations in selecting the mix of options - Intergenerational issues
An important equity consideration is that consumption of capital infrastructure by the present generation not be at the expense of future generation and conversely that future users not benefit from capital infrastructure without making a financial contribution toward its cost. The two approaches to financing infrastructure are currently referred to in the practitioner literature as pay- as- you- go (capital from operating revenues or if applicable, depreciation funds generated) and pay-as you-use (through debt service charges on long term borrowing) with the third option being a combination of the two. The hybrid approach addresses the intergenerational equity issue by borrowing for large scale projects such as water and sewage treatment plants that occur infrequently and financing ongoing capital expenditures such as water, wastewater, and stormwater line replacements and system upgrades and improvements through depreciation funds and capital out of revenues from current taxes and rates. In Section 5 of this report, three categories of capital expenditure and identified and referred to as drivers. Asset renewal is the largest of the three drivers and comprises 57.3% of the program. Under the hybrid approach, it would be funded through non debt sources. The other drivers (i.e. growth and compliance) would be funded through debt and development charges. Two important requirements must be met for the hybrid approach to meet its objectives. First the term of the borrowing should be structured so that it does not exceed the life of the asset but is as close to the asset life as permitted by prescribed accounting regulations and responsible debt management practices. In this way, those benefitting from the asset at various times over its useful life will contribute to its cost. Secondly, system replacements and upgrades which are carried out on an ongoing basis should be financed from depreciation funds and capital out of revenue within a set and acceptable annual range of capital expenditures. There are two benefits that accrue from the second point; i.e. as this expenditure amount is similar from year to year there is compliance with intergenerational equity criteria, and debt service costs, which can be significant in high interest rate environments, are not incurred.
Debt Limit Considerations

Prior to a recommendation on debt limits and funding mechanisms for HRWC it is necessary to identify any restrictions that would influence the recommendation. In addition to the NSUARB which has regulatory authority over the HRWC and provides the final approvals, there are three Nova Scotia governments / government bodies that have the ability to influence or restrict HRWC debt limits. They are Halifax Regional Municipality, the Province of Nova Scotia, and the Nova Scotia Municipal Finance Corporation. The role of each is discussed below. NSMFC The Nova Scotia Municipal Finance Corporation provides long term loans to Nova Scotia municipalities and enterprises through debt pooling with credit enhancement provided by a Provincial guarantee. The rates are competitive and participation is mandatory for Nova Scotia municipalities issuing long term debt. NSMFC loans to municipalities and municipally guaranteed enterprise loans are dependent on Ministerial approval of the borrowing or the guarantee. The NSMFC applies the same capital borrowing
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guidelines to HRWC loan applications as the Minister would apply to a municipal borrowing request. There is no indication that the existing long term financing arrangements through the NSMFC, including credit enhancement through the Provincial guarantee, will change. HRM guarantee of HRWC debentures In addition to the due diligence issues of prudent financial management and quality service delivery associated with any of its local government enterprises, HRMs interest in HRWCs debt limits would relate to how they reflect on HRMs financial statements and credit rating. Council to date has not set limits or restrictions on the amount of debt HRWC can issue. As long as HRWCs debt ratios remain within acceptable Canadian municipal standards it is unlikely HRM would imposed restrictions. Standard & Poors has indicated an increase in the use of financial leverage through a higher debt equity ratio by HRWC would have an impact on HRMs credit rating at some point.27 HRMs credit rating is not currently a determining factor in the cost of borrowing through the NSMFC as all NSMFC borrowers pay the same rate of interest for loans with similar structures and terms. It is only the HRWC loans related to large capital projects that require a HRM guarantee. The NSMFC and HRWC have worked out an arrangement in the interest of administrative convenience, whereby NSMFC will provide up to $70 million in unguaranteed loans for smaller projects. Provincial Borrowing guidelines and restrictions on HRWC and HRM capital borrowing / guarantees. The Municipal Government Act (Section 86) provides the authority for the Minister responsible for local government in Nova Scotia to establish borrowing limits. This has resulted in the development of capital borrowing guidelines for municipal units in Nova Scotia. The guidelines are as follows: 1. A municipalitys existing and proposed gross debt service costs (excluding those relating to self-supporting utilities) should not exceed 30% of property tax and other own source revenue. Other debt service charges attributable to the property tax base should be included in the 30% figure. For debt charge projection purposes, a 20 year amortization should be used unless the useful life of the asset being funded is for a shorter period of time. 2. The Minister may make adjustments for federal or provincial debt service charge cost sharing when applying guideline 1. 3. All municipal borrowings to be approved on a project by project basis. 4. When requested, a municipal unit shall submit a schedule of debt charge and own source revenue projections and ratios prior to the Ministers approval of a capital borrowing. 5. Only those units that are financially independent (i.e. do not rely on the Province for emergency funding) are permitted to borrow for capital purposes.
27
June 8, 2011 meeting with Standard & Poors in Halifax
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6. In the event that a financially independent unit wishes to proceed with a project which will result in it exceeding guideline 1, that unit may conduct a plebiscite to request voter approval to proceed with the project. The Minister will not be bound by the plebiscite results but may take it into account when making his/her decision. 7. Exceptions to the above guidelines can be made in cases where a municipality is legally required to undertake a capital project. Any debt service cost excesses should be eliminated as soon as possible through the postponement of other capital work until the debt service guidelines are not exceeded. As self-supporting utilities are excluded in these guidelines, Service Nova Scotia and Municipal Relations was formally asked to provide clarity on the capital borrowing guidelines for municipal units in Nova Scotia as they would apply to Halifax Waters specific situation. A response was provided in a September 12, 2011 letter28 from the Deputy Minister who expressed the belief that a maximum debt service ratio for HRWC that was higher than the 30% now established for municipalities would require considerable justification. The magnitude of the capital investment required to implement the IRP would justify proposing a case for a higher debt service ratio for a regulated low risk utility for a limited period of time. In light of this, an upper DSR limit of 35% was used for study purposes.
Analysis of funding options using IRP data

In Section 5 three general requirements that should be met in order for the recommended funding mechanism to be considered acceptable were identified. The first is rate stability and affordability to those using HRWC services; the second is HRWC long term financial sustainability as measured by generally accepted financial measures and ratios, such as the debt service and debt/equity ratios, that reflect industry standards and guidelines for a regulated municipal enterprise in the Province of Nova Scotia; and the third requirement is equitable allocation of costs to current and future users, commonly referred to as inter-generational equity. The data was used to evaluate eight alternative scenarios. The evaluation was undertaken with the aid of a modified version of the Debt Affordability Model developed by NSMFC to assist local governments in capital planning and affordability assessments. At HRWCs request, NSMFC developed the modified version specifically for the purpose of assisting HRWC in undertaking a debt affordability analysis using capital project data from the Integrated Resource Plan. This robust model links several spreadsheets containing financial data (e.g. operating budgets, capital programs, depreciation schedules, capital assets) and provides a linked input sheet and produces debt service charge graphs and financial information in tabular format. Additional spreadsheets were added by HRWC to facilitate the link with financial data and ratio calculation and analysis.
28
Letter from Deputy Minister Kevin Malloy to HRWC director of Finance and Customer Service Cathie OToole dated September 12, 2011
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The alternatives were selected by starting with the status quo or `base case sources and amounts of non-debt revenue and financing the difference between the capital expenditure requirement and nondebt revenues available through borrowing (debt)This base case did not meet the three general funding mechanism requirements as the financial ratios were well beyond acceptable best practice and regulatory ranges, and the heavy reliance on debt did not match closely with the allocation of expenditures by driver; i.e. asset renewal, growth and compliance. It was also the least affordable of the options considered. Additional detail on the base case is provided in Appendices B and C. Before proceeding with an analysis of the other alternatives, the criteria used in assessing the three general requirements is provided. Under rate stability and affordability the two measures are the utility bill as a percent of median household income (which should not exceed 4-5%) and a steady increase in rates (rather than sporadic upward and downward rate shifts) to finance the capital program. Financial sustainability is measured by the debt service ratio (35% upper limit with 30% or less preferred), the debt to operating revenue ratio (currently at 148%), the debt to equity ratio (or debt to capital assets under administration) where, given the prominence of the asset renewal driver over the other drivers, a 35%-50% range for the debt portion as a percentage of capital under management is considered an adequate range for HRWC29, and the HRWC accumulated surplus / deficit position which should not exceed 5% of annual revenues. The equitable allocation of resources is measured by the match between drivers and funding sources. These measures are supported by the literature and summaries provided in earlier sections of the report. In order to evaluate each alternative it was necessary to make adjustments to the data inputs and an iterative process was used. For example, when additional external funding was added or removed, it was necessary to adjust revenue requirements to prevent annual operating deficits and minimize annual surpluses. Alternative two increases the amount generated by depreciating existing contributed assets from 2015 onwards. This amounts to in 46% of IRP capital spending financed by depreciation funds compared to 40% in the base case (alternative 1) and this level of depreciation is used in all other scenarios which follow. This alternative is not acceptable from a financial sustainability perspective as the peak debt service ratio exceeds 35% and the debt to capital under management exceeds 50% in peak years. Alternatives three to five involve adding addition revenues from non-debt sources. Alternative three increases the regional development charge (RDC) by nearly doubling it to $197 million. Alternative four provides for $432 million in government grants towards asset renewal or compliance projects and, with 12% of the $3.6 billion capital program funded through grants, the projected amount is considered conservative. Alternative five includes both the increased regional development charge ($197M) and
29
For investor owned utilities AWWAs recommended range is 33-60% and WEFs is 50-60%. As investor utilities debt equity ratios tend to be higher than municipally owned utilities a lower top range is recommended for HRWC. Also the AWWA survey of group A American water utilities (Halifax is also Group A) which are nearly all municipally owned shows a mean debt equity split of 44/56 which is also the median figure.
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$432M in government grants. The additional revenues introduced through these scenarios reduce the need for borrowing and have a positive impact on rate stability and affordability. If the grant revenue is used for asset renewal, the equitable allocation of resources between present and future users is strengthened. Ongoing asset renewals would be not be financed through debt and the adoption of the hybrid approach to achieve intergenerational equity, as discussed earlier, would be achieved. Alternatives four and five meet the financial sustainability criteria; alternative three does not. Alternatives six to eight all include the $432M in government grants and an increase in RDC revenue compared with the earlier alternatives. Alternative six includes RDC revenue of $693M which pays for approximately 100% of costs associated with growth. Alternative seven includes RDC revenue which covers 50% of growth ($346M) and alternative eight assumes that 75% of growth is financed through the RDC. These alternatives all meet the stability and affordability criteria as well as those applied to long term financial sustainability. When the depreciation funds and most of the grant funding are combined they generate enough revenue to fund the asset renewal driver. The remaining funding sources and drivers are well matched in alternative six where the RDC covers the growth driver capital expenditures and borrowing matches the compliance driver requirements thus supporting an intergenerational equity funding mechanism. RDC revenue represents costs that are recouped from charges rather than rates so with a fixed IRP dollar requirement, revenues raised through RDCs reduce the revenues need through rates (including borrowing which is repaid through rates over a period of time). Alternatives seven and eight propose less revenue from RDC than alternative six and therefore are less attractive than alternative six when evaluated in the context of the three general requirements used in the evaluation. In the full cost recovery alternative (#6), growth is being covered by those benefitting directly and compliance is covered through borrowing that is repaid by current and future users. In the partial growth recovery alternatives (#7 and #8), a portion of the capital costs associated with growth is financed through borrowing and repaid by current and future users. Alternative six is preferred because it ranks highest in meeting all three requirements, as identified in this study, referred to above. The household bill as a percent of household income peaks at 1.68% during the thirty year period and is 1.39% in 2042-43. This compares favourably with the results of the affordability research presented in Section 3 which identifies 4 to5% as an upper limit. The debt service charges peak at 24% which is well below the 35% maximum acceptable rate used in the study. The debt to annual revenue ratio peaks at 246% in 2023-24 and is estimated at 72% at the end of the thirty year period. The maximum debt to capital under management ratio is 38%. The equitable allocation of costs to current and future users for alternative 6 is favourable as discussed above. However, there are external factors that may result in resistance to an increase of this magnitude in RDC revenues; especially in the short term. If Alternative 6 is not accepted after further consultation with stakeholders and consideration by the NSUARB, the next best options (in order) are alternatives 8 and 7 followed alternatives 5 and 4. All of these options satisfy the minimum requirements for long term financial sustainability and rate stability and affordability. The costs allocated is less equitable as a portion of growth is funded through borrowing, which is repaid through general rates, rather than funded exclusively by RDCs on properties benefiting directly from the capital expenditures.
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Sensitivity analysis on interest rates and loan amortization periods

Interest rates trends (and volatility) over the thirty year period covered by both the IRP and this study are difficult to predict so the weighted average cost of debt (WACD) for HRWC has been used as a proxy for future borrowing costs. Currently, borrowing rates for HRWC are a full percentage point below the WACD which reflects the downward trend of long term interest rates during the last decade. Interest rate sensitivity analysis was undertaken for all alternatives with the potential to meet the three criteria used for evaluating an efficient funding mechanism for HRWC. If 2012 interest rates (3.62% was used in the calculations) on HRWC borrowing remained in effect for the period under review the DSRs for alternative 6 would remain at acceptable levels. Should interests rise to a full percent above the WACD to 5.62%, DSRs would remain under 28%. In fact, average borrowing rates during the period could reach 7% without having the DSR exceed 47% and 9.5% before it exceeded 35%. This additional interest rate capacity minimizes the impact of upward interest rate risk on implementing the IRP using the funding mechanism in alternative 6 and, to a lesser extent, other acceptable alternatives. . The debt service analysis was based on the twenty year loan amortizations which is typical of the amortization period on other HRWC loans through the NSMFC. The term can be shortened or lengthened as long as it does not exceed the useful life of the asset. Sensitivity analysis was carried out by increasing the amortization period on some of the larger loans. It had the effect of a slight decrease in peak DRSs and a corresponding increase in interest costs. As the peak DSRs were acceptable under a number of alternatives, the twenty year amortization period was retained. Regardless of the financial alternative selected for the implementation of the IRP, it will be necessary to monitor interest rates closely and make adjustments that reflect changing conditions to ensure rate stability, financial sustainability and adherence to external to HRWC debt limit restrictions resulting from policies and approval mechanisms of the Province, NSMFC, and HRM.
Summary
This section identified and analyzed funding options available to HRWC for financing the $3.6 billion in capital expenditures identified in the smoothed Integrated Resource Plan. The analysis for each option focused on its ability to meet three general requirements. The requirements are (1) rate stability and affordability for those using HRWC services, (2) the equitable allocation of costs to current and future users and (3) long term financial sustainability for the utility. One alternative (#6) met all the requirements but may require an extended implementation period if accepted. In the interim, there are other alternatives that meet the rate affordability and long term financial sustainability requirements and achieve many of the equitable allocation of resources through inter-generational equity requirements.
Recommendations
Three general requirements to be satisfied when evaluating funding mechanism alternatives were identified. They are rate stability and affordability; financial sustainability; and equitable allocation of resources. Eight alternatives were developed and analyzed using specific criteria related to the three December 31, 2012
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general requirements. One of the alternatives is preferred and four of the others would be acceptable as they meet the minimum requirements for most of the measures selected. Alternative six is recommended as it has the most potential to meet the requirements and is more affordable, more equitable, and ranks higher is the financial sustainability category through lower maximum debt outstanding, lower debt to revenue ratios, lower debt to equity ratios, and lower revenue requirements. In adherence to the Boards directive NSUARB 2010 244 (289) that HRWC undertake a complete study which examines: an efficient capital structure; policies of other utilities; its longer term capital needs; and opinions which would result in an efficient funding mechanism that is fair to present and future ratepayers the study recommendations are as follows. 1. It is recommended that capital expenditure on asset renewal, which represents 57.38% of capital expenditures, be funded through depreciation and grants. 2. It is recommended that capital expenditures for growth and compliance be funded through regional development charges (RDCs) and from issuing debt. The preferred scenario from an equitable cost allocation to current and future users would be to have RDCs fund as much of the growth as possible. 3. It is recommended that alternative six be considered first as it is the alternative that most satisfies the funding mechanism requirements. 4. It is recommended that if alternative six cannot be achieved in the short term that other alternatives be considered in the sequence provided in Section 6 of the study from data summarized in Appendix B.
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APPENDIX A - Summary Highlights of Debt Management / Capital Structure Policies of

Cities, LGEs, and Provincial Oversight Departments for Municipalities
Updated Oct 7, 2011
CANADIAN CITY
Table 1 Canadian Cities and Regions

SOURCE OF INFORMATION KEY POINTS
Moncton
Moncton debt policy
-Mix of reserves, pay as you go and debt -Total General Fund debt outstanding will be less than 2% of assessment base -General Fund annual debt service cost shall be less than 20% -Total utility debt outstanding will be evaluated in relation to long term debt repayment impact on the associated user fees.
Halifax
HRM revised debt servicing plan Council report Mar 2009 Standard & Poors HRM rating April 5, 2011
-Rated by S&P - Subject to Provincial guidelines; max debt service charges of 30% of revenues. Current ratio is 8.7%. Ratio for HRWC is 25% -Increase percentage of capital funding from non-debt sources (e.g. operating or reserves) -Focus on reducing tax supported debt outstanding by 3% per annum -Debt funding will be restricted to items with a life expectancy of 10 years -Amount of new debt funded from the general tax rate will be limited to the debt being retired in the same year less a target debt reduction
Toronto
Toronto website: City finances Feb 3/11 staff report on financing capital works policy Meeting with Standard & Poors
-15% debt service cost limit on property tax supported debt - 20% debt service cost limit on solid waste management capital debt supported by user fees - City does not borrow for water capital which is financed out of rates (operating revenues) - Policy has been to increase water rates by 10% pa and use revenues generated above that needed for operations to fund
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capital -Toronto Community Housing Corporation can issue debt in its own name as long as it does not increase the citys subsidy - Toronto Hydro can participate in capital markets on the condition they maintain a minimum credit rating -Toronto Water budget is part of Citys budget
Niagara Region
Report of Summary of changes to the capital asset management policy Oct 14, 2009
Reference to a maximum debt service ratio of 25% of own source revenue
Winnipeg
City of Winnipeg Debt Management Policy (website)
- Interest cost on tax supported debt not to exceed 10.4% of net combined revenue (if it does provincial capital assistance is reduced) -Focus on pay-as-you-go for tax supported debt since 1998 -Preferred term of financing is 20 years -Water and waste services provided by city department
Calgary
City of Calgary taxsupported capital financing policy review (2002) City of Calgary Capital financing review: Debt analysis (2008)
-Water is a city business unit -Prov. Regulations specify municipal debt (tax supported + selfsupported) can be no more than twice its revenue, and debt servicing can be no more than 35% of revenue -Citys target is tax supported debt service not exceed 10% of gross expenditure (net of recoveries) - Established $1000 per capita tax supported debt benchmark
Edmonton
City policy: debt management fiscal policy 2008 07 23
-Debt limits based on debt service costs -22% of City revenues for total debt and 15% of tax levy for tax supported debt
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Table 2 Canadian Provinces and Municipal Finance Authorities

PROVINCE / MFA SOURCE OF INFORMATION Alberta Capital Finance Authority (provides municipal financing) Conversation with ACFA President Prov. of AB website -Debt limits 1.5 times generated revenue and debt service max 25% - 4 largest cities: debt limits 2 times generated revenues and max debt service 35% -Rapid growth increases demand for municipal infrastructure -EPCOR the Edmonton Water LGE borrow on its own and has an A or BBB credit rating (depending on the rating agency) which is less than AMFA British Columbia Municipal Finance Authority Conversation with Graham Egan CFO Mar 15/11 -First approval BC-Department of Municipal Affairs (legal and financial) -BCMFA debt service limit 25% based on sustainable revenues and 15 year loan terms. Some industrial tax revenue excluded from calculation. -Municipal enterprise revenue and loans included in debt limits -Joint and several municipal guarantees on regional LGE sewer and water districts Province of Nova Scotia Capital borrowing guidelines for municipal units in Nova Scotia (1992) -A municipalitys existing and projected debt service costs (excluding those relating to self-supporting utilities) should not exceed 30% of property tax and other own source revenues. Other debt service charges attributable to the property tax base should be included in the 30% figure. -For debt charge projections a 20 year amortization should be used unless the useful life of the asset being funded is for a shorter period of time -Exceptions to the above guidelines can be made in cases where a municipality is legally required to undertake a capital project KEY POINTS
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Province of Ontario

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Website: Debt management -25% limit on % a municipality can commit of total own source revenue to service debt without OMB approval - 7 commonly used debt measurement tools -Debt limit is based on the amount of debt repayment not the principal amount of debt issued -Pros and cons of long term debt vs. pay-as-you-go; debt is an attractive mechanism in a low interest rate, low inflation, low debt environment.
Saskatchewan cities
Conversation with clerk of Sask. Municipal Board
Limits are stated in dollar amounts (not ratios) Cities make a request for a particular limit SK Municipal Board responds to (approves limits) after an evaluation that includes a review of existing debt obligations, financial and economic indicators, etc. A 25% annual debt service guideline is used as a benchmark
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Table 3 Canadian Local Government Enterprises

CANADIAN LG ENTERPRISE EPCOR Edmonton LGE EPCOR website EPCOR Finance Dept. staff email correspondence EPCOR Utilities Investor presentation Sept 2009 Foster Associates Capital structure and cost of capital study for EPCOR White Rock and EPCOR Water (west) 2008 Provides water wastewater services to the City of Edmonton and other communities in Alberta and British Columbia Also provides electric distribution and transmission and energy services Utilizes preferred shares and subordinated debt in its capital structure EPCOR debt policy is built around a stand-alone principle whereby an internal credit rating is assigned to each subsidiary. Regulatory rulings take precedence over EPCORs internal policies on debt matters. Efficient tax planning results in a preferred capital structure for each subsidiary EPCOR does not have specific debt service charge limits but capital structure is the dominant factor in establishing intercompany loan rates and attention is paid to ensuring appropriate debt coverage ratios such as EBITDA/interest. Interest is a deductible business expense on all EPCOR activities Foster Associates recommends common equity ratios of 45% and 50% for two EPCOR water business ventures in British Columbia communities (White Rock and French Creek) ENMAX Calgary LGE (electric) ENMAX website Debt to total capitalization 43% (2010) debt / equity split 43/57 (2010) Provides electricity, natural gas, fibre optic but not water / waste water service Owned by City of Calgary Document referenced KEY POINTS
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AMERICAN CITY / LGE Anchorage, Alaska

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Table 4 American Cities and Municipal Enterprises

Document referenced Website Comprehensive annual financial statements 2009 CAFR KEY POINTS No legal debt limit mandated by the municipal charter, municipal code or state law City debt service as a % of non-capital expenditures is 8.73% Ratio of GO debt to assessed property value is 1.43% Water utility debt coverage ratio 1.93; debt service ratio 23% Wastewater utility debt coverage ratio 2.99; debt service 10%
Ann Arbor, Michigan
Website: FY 2010 Comprehensive Annual Financial report (CAFR)
City department provides service Debt limit is 10% of taxable value of real and personal property Existing debt is only 26% of the citys debt limit Revenue coverage ratios in 2010 are water 1.4, sewage disposal 2.5 and stormwater 19.8
Colorado Springs
Website: debt Management (2009) budget CSU staff email correspondence
- The city shall not become indebted for any purpose to an amount which shall exceed 10% of the assessed valuation of the taxable property with the city - The total bond indebtedness in 2009 is 0.6% of the limit - Water facilities or supplies shall not be included in determining the amount of indebtedness -Utilities have no formal debt limit policy but are mindful of rating agency criteria for debt leverage and debt service coverage.
Portland Oregon (city)
Debt management policy (City)
The amount of direct, non-self-supporting, limited tax indebtedness and full faith and credit lease purchase lease obligations outstanding at any time that is not subject to approval by the voters does not exceed 1% of the Citys taxable real market value The amount of direct, self-supporting, limited tax indebtedness outstanding at any time that is not subject to
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approval by the voters does not exceed 1% of the Citys taxable real market value
Louisville Water Company (municipally owned)
Financial management policy Louisville water company
-Water company board appointed by mayor -Debt obligations may be issued only if the maximum aggregate bond service multiplied by 1.3 will not exceed annual net revenues -Define bond service
Phoenix, Arizona
Debt management policy (City)
-The citys outstanding general obligation debt for water, sewer, parks, public safety, law enforcement, fire, emergency, recreation and street lighting is limited to 20% of the citys assessed valuation - The citys enterprises (e.g. water / wastewater) can issue bonds backed by the revenues of the enterprise -Obtains a rating from at least one nationally recognized rating agency on all new bond issues being sold in the public market -A bonds maturity shall be equal or less than the remaining useful life of the asset being financed and the average life of the financing shall not exceed 120% of the average useful life of the assets being financed
Northeast Ohio Regional Sewer District (Cleveland and area) (Regional government enterprise)
Debt management policy
-Funds most infrastructure through a state revolving loan fund

-Debt amortization period cannot exceed asset life -Use of capital out of revenue to pay for capital expenditures expected to recur on an annual basis -Use of capital out of revenue for ongoing equipment replacement and for lager capital projects when available cash balances exceed working capital needs -Limits variable rate bonds with interest reset periods of one year or less to 25% of the debt portfolio
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Appendix B Summary of the Evaluation of Funding Mechanism Alternatives
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Appendix B Affordability - Projected Average Bill Peak Funded Debt Bill as % of Total Annual Increase Debt Debt/Capital Outstanding / % of Capital Household Residential Rev over 30 Outstanding Under Asset NBV - Funded by Income in Bill in Increase Years, 2042/43 Management 2042/43 Debt 42/43 42/43 Required less CPI 598,446,062 523,326,512 56.01% 53.70%
20.78% 19.68%
EVALUATION OF DEBT STRATEGY ALTERNATIVES - Financing of $3,608,159,315 Smoothed Integrated Resource Plan over 30 Years
Alternative 1. Base Scenario - Status Quo 2. Base Case plus depreciation on donated assets from 2015/16 Forward
Total Depreciation Funding 1,427,162,000 1,648,200,750
Total Regional Development Charge 100,600,000 100,600,000
Total Infrastructure Grants 0 0
Total Debt 2,078,397,315 1,857,358,565
Peak DSR 39.94% 36.80%
DSR - in 2042/43
Peak Debt Outstanding
26.03% 1,015,972,444 22.90% 925,221,569
57.60% 51.48%
1.70% 1.67%
$2,351.33 $2,313.63
4.54% 4.49%
88% 83%
3. Option 2, plus doubled existing level of Development Charges starting jn 2014/15 1,648,200,750 196,880,000 0 1,761,078,565 36.03% 21.70% 890,859,569 4. Option 2, plus Federal and Provincial Funding, existing Development Charge Status Quo 1,648,200,750 100,600,000 432,078,156 1,425,280,409 32.06% 16.20% 721,343,118 5. Option 2, Fed/Prov Funding and existing Development Charges doubled 1,648,200,750 196,880,000 432,078,156 1,329,000,409 30.78% 14.96% 686,981,118 6. Option 2, Fed/Prov Funding, Development Charges pay for all IRP "Growth" 1,648,200,750 692,818,170 432,078,156 833,062,239 8.08% 501,460,471 24.12% 7. Option 2, Fed/Prov Funding, Development Charges pay for 50% of IRP "Growth" 1,648,200,750 346,409,085 432,078,156 1,179,471,324 28.90% 12.98% 628,798,794 8. Option 2, Fed/Prov Funding, Development Charges pay for 75% of IRP "Growth" 1,648,200,750 519,613,628 432,078,156 1,006,266,782 26.47% 10.75% 565,129,633 Interest Rate in all scenarios is HRWC's Weighted Average Cost of Debt (projected as of March 31, 2013) - 4.62% Median Household Income for HRM Census Metropolitan Area is $76,500 per Statistics Canada 2010. Inflation/CPI at 2% Total Average Residential Bill Water, WW, SW in 2012 is $636.24, or 0.83% of median Household Income. Affordability Benchmark (WEF and AWWA is 4 - 5%) Total NBV of assets in 42/43 Total IRP spend adjusted for 5 Year plan $ 2,659,129,250 $ 3,608,159,315
488,466,512
52.67%
18.37%
48.81%
1.64%
$2,266.30
4.42%
75%
354,650,556 323,442,808
47.40%
46.27%
13.34% 12.16%
39.50% 36.83%
1.53% 1.50%
$2,119.60 $2,077.53
4.18% 4.12%
52% 45%
189,968,754
38.41%
7.14%
23.09%
1.39%
$1,930.87
3.85%
22%
281,345,682
43.99%
10.58%
32.69%
1.47%
$2,037.99
4.04%
39%
234,909,739
41.42%
8.83%
27.89%
1.44%
$1,995.76
3.97%
33%
Recommendations: 1. Target Debt Service Ratio of 35% (should not exceed) 2.Target Debt/Equity Ratio of 40%/60% 3. Rates should be less than affordability benchmark Screening Criteria - 3 General Requirements 1. Rate stability and affordability 2. HRWC long term financial sustainability 3. Intergenerational equity
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Alt 1 Alt 2 Alt 3 Alt 4 Alt 5 Alt 6 Alt 7 Alt 8
Stability & Affordability Bill as a % of median household income Projected annual residential bill in 2042/43 Equitable allocation of costs to current & future users % of growth paid for by growth % of asset renewal paid for by depreciation
1.70% 1.67% 1.64% 1.53% 1.50% 2,351 $ 2,314 $ 2,266 $ 2,120 $ 2,078 $
1.39% 1.47% 1.44% Lowest % is best 1,931 $ 2,038 $ 1,996 Lowest is best
14.52%
68.93%
14.52% 79.61%
28.42% 14.52% 79.61% 79.61%
28.42% 79.61%
100.00% 79.61%
50.00% 79.61%
75.00% Highest % is best 79.61% Highest % is best
Long term financial sustainability for the utility Peak DSR 39.94% Peak Debt to Equity Ratio (% of Capital Funded by Debt) 57.60%
36.80% 51.48%
36.03% 48.81%
32.06% 39.50%
30.78% 36.83%
24.12% 23.09%
28.90% 32.69%
26.47% DSR Less than 35% is acceptable 27.89% Debt should not be more than 40%
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Appendix C Detailed Information on Each of the Funding Mechanism Alternatives
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Summary of Alternative #1
Alternative #1 - Base case with no additional sources of revenue. Existing regional development charges and no capital from revenue nor government infrastructure grants. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. All contributed assets acquired in the future are depreciated. SCENARIO DESCRIPTION - This is the Base case scenario with no additional sources of revenues beyond those currently is use. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 58% from Borrowing 40% from depreciation 3% from RDC Financing sources not matched to drivers WACD = 4.62% 39.94% 12 336% max in 2030-31 20 years $1,016M 56.01% max 2031-32 9 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42%
Interest rates Debt Service Ratio HIGH Number of years DSR over 35% Debt as a % of annual revenue Amortization period of loans Maximum debt outstanding Debt outstanding/ capital under management No. of years over 50% Accumulated deficit /surplus year end maximum Operating revenue peak amount Interest rate sensitivity impact
HRWC weighted cost of debt 2032-33 0 years over 40% 186% in 2042-43
No accumulated deficits
Accumulated surpluses are well below 2% of revenue for most of the period In 2034-35 Interest rates at 1% above WACD would result in a DSR of over 40% in 5 years and over 35% in 16 of the 30 years
1.70% in 2042-43
$328 million At current MFC rates (3.62% for 20 yrs.) the DSR would exceed 35% in 4 of the years over the period.
Max 3.04% in 2033-34
Bill as % of household income
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Projected Debt Service Ratio of

Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21
D. S.R.
20.69% 18.40% 13.36% 19.77% 2111% 26.96% 27.26% 25.85% 29.54%
Revenues
109,753,580 123,411,455 138,152,128 147,482,404 158,166,344 169,647,506 178, 360,794 188,903,725 197, 328,221
Borrowing
0 65,077,000 44,614,000 84,194,000 92,071,000 73,115,000 102,937,000 72.054,000 109,893,000
Debt Servicing
15,600,907 22,712,820 28,456, 893 31.658,103 38,545,569 45,741,158 50,112,285 55,330,116 59,981,467
Debt DiS
182,557,458 232,033,551 258,126,008 321,560,410 388,811,836 432,982,935 504,574,799 543,267,649 616,761,251

loom% 95.00% 90.00% 85.00% 80.00% 75.00%
70.00% 05.00%
60.00%
55.00% 50.00% 45.00% 40.00%
2021-22
2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2036-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046 47 2047-48 Total
32.63%
28.15% 36.96% 35.95% 34.95% 34.18% 35.24% 35.11% 35.42% 36.70% 38.61% 39.94% 39.13% 37.72% 3E 92% 35.15% 33.21% 32.11% 30.93% 30.24% 28.62% 26.03% 25.45% 24.15% 22.63% 21.14% 19.60%
209,967,176
229,548,656 243,162,378 242,206,644 245,384,786 256, 370,647 255,373,998 264, 874,550 274, 076,617 282, 246,374 303,209,382 318,997,051 328,512,962 328,564,554 325, 367,414 325,421,091 325,475,841 325,531,686 325,588,648 325,646,749 325,706,012 322,549,194 322,610,852 322,673,742 322,737,890 322,803,322 322,870,061
177.165,000
116,826,315 31,097,000 46,241,000 47,000,000 52,616,000 58,288,000 72,363,000 104,627,000 174,203,000 143,782,000 69,317,000 26,643,000 18,072,000 22,181,000 19,544,000 37,142,000 46,513,000 44,898,000 35,211,000 27,879,000 60,834,000 0 0 0 0 0
68.520.065
81,817,489 89.871,138 87,078,728 85,750,191 87,626, 854 89,996,756 93,000, 002 97,076,082 103,592, 266
752.307,957
820,408,056
797.037,825
790,451,264 785,617,133 784,299,001 786,222,070 799,305,738 841,185,257 948,059,425
35.00% 30.00%
25.00% 20-00% 15.00% 10.00%
5.00%
0.00%
tf. 1 1
117,073,930 1,015,972,444 127,403,611 1,002,231,362 128,551,520 123,942,777 120,121,437 114,379, 594 108,102,697 104,529,445 100,717,081 98.473,358 93,213,511 83,968,314 82,115, 089 77,925,797 73,051,139 68,245,348 63,267, 327 944,070,262 879,259,862 819,385,562 759,849,912 721,438,612 696,196,962 669,986,512 635,121,862 596,574,312 598,446,062 541,423,512 485,955,812 432,803, 162 381,994,512 333,819,662
19
1.9
1"' tie
`6'M M 1 3 1 1 )
# 1 %
-f3 -P
95' 95'
+ + 0 0
The above O.S.R.'s are based on using NSMFC's Spring 2012 debenture interest rates.
1) Al current debentures with capon payments are refinanced for 11 -teir remaining lire, 2) All future debenture requirements are assumed to be financed in a MFC TALL' debenture_ 3) The above D.S.R.'s includes those debentures he by HRM which HRWC reimburses HRM. 4) All future borrowings assumed for "20" years, using "senar debentures. Any "balloons" refinanced at same interest rates.
Alternative 1 Funding Mix

s Cap from Op S Depreciation s !Wording Reglon al Dev Charge Sale of Lend s oetrt
060% 0.00%
9,408,644,432 ' 2,078,391,315 2,917,547,864

0
Ott
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Alternative #2 - Base case (Alternative #1) with Increased funding from depreciation resulting from depreciation on existing contributed assets from 2015 onward. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. There are no additional sources of revenue beyond those currently in use. It does not include cost sharing from federal and provincial government to cover a portion of the cost of compliance projects. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 51% from Borrowing 46% from depreciation 3% from RDC WACD = 4.62% 36.80% 3 Max 326% in 2021-22 20 years $925 M 53.70% max 2031-32 4 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42% HRWC weighted cost of debt 2032-33 0 years over 40% 166% in 2042-43
Interest rates Debt Service Ratio HIGH Number of years DSR over 35% Debt as a % of annual revenue Amortization period of loans Maximum debt outstanding Debt outstanding/ capital under management. No. of years over 50% Accumulated deficit /surplus year end maximum Operating revenue peak amount Interest rate sensitivity impact
Accumulated surpluses are below 2% of revenue for most of the period In 2035-36 Interest rates at 1% above WACD would result in a DSR of over 35% in 8 of the 30 years 1.67% in 2042-43
$322 million At current MFC rates (3.62% for 20 yrs.) the DSR would exceed 35% in 0 of the years over the period. Max 2.04% in 2033-34
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Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046-47 2047-48 Total
D.S.R.
20.69% 18.44% 13.35% 19.50% 22.19% 25.43% 25.27% 23.72% 27.14% 29.85% 25.53% 34.05% 32.73% 31.69% 30.99% 31.76% 31.50% 31.84% 33.25% 35.47% 36.80% 36.24% 34.70% 33.41% 31.88% 29.90% 28.81% 27.68% 27.05% 25.48% 22.90% 22.39% 21.33% 20.04% 18.77% 17.44%
Revenues
109,753,580 123,185,570 138,234,394 149,545,173 163,595,133 177,047,532 186.665,250 195,893,926 202,731,614 215,721,567 233,749, 731 247,047, 364 246,076,385 247,509,499 256,785,312 255,787,935 265,304, 010 273 ,211, 056 279,330, 814 298.695,440 314,984,274 322,043, 565 322,095,157 322,147, 781 319,016,388 319,071,138 319,126, 983 319,183,945 319,242, 046 319,301, 309 316,208,538 316,270,196 316,333,086 316,397,234 316,462,666 316,529,405
Borrowing
0 65,077,000 44,614,000 81,651,500 07,013,000 65,546,750 92.916.000 62,173,000 100,106,000 167,403,000 107,121,315 21,387,000 36,575,000 37,359,000 43,000,600 48,733,000 62,834,000 95,128,000 166,811,000 136,542,000 62,132,000 19,483,000 10,937,000 15,085,000 12,480,000 30,114,000 41,577,000 38,185,000 28,972,000 21,710,000 54,693,000 0 0 0 0 0
Debt Servicing
15,600,907 22,712,820 28,456,893 31, 658,103 38,300,980 45,015,863 48.676,482 52,965,332 56, 724,319 64,402,421 76, 864 ,362 84, 110,562 80,532,640 78,445,254 79,587,802 81,248,264
Debt 015
182,557,458 232,033,551 258,126,008 319,017, 910 351,335,461 418,321,335 480,650.637 510,721,974 576,182,114 704,209,707 765,335, 794 735,471, 800 722,920,977 71Z630, 883 706,363,839 703,879,795 713,060,101 751,542, 707 857,601, 913 925,221, 569 911,604,125 853,950, 912 790,031,400 731,443, 737 673,454,400 636,725,712 613,231,662 588,837,562 556,104,862 519,581,862 523,326,512 474,139,662 426,022,162 379,733,412 335,312,612 293,041,812

100.00% 95.00% 90.00% 85.00% 80.00% 75.00% 70.00% 65.00% 60.00% 55.00% 50.00% 45.00% 40.00% 35.00% 30.00% 25A0% 20.00% 15.00% 10.00% 5.00% 0.00% \ ?"' N. N?)
83, 570,151
86, 989,446 92, 873,743 105, 948,155 115,899,283 116, 696,654 111,753,376 107, 616,444 101,706,369 95,400,612 91, 932,109 88, 354 ,734 86,353,326 81, 369,376 72,397,363 70, 808,866 67,467,083 63,415,305 59,408,815 55,206,574
ti
.c%
11
'
6%.
,;" ? -
p:\ -6) 4
The above D.S.R.'s are based as using NSNIFCs Spring 2012 debenture interest rates. Assumptions: 1) Al current debentures with baloon payments are refinanced for their remaining lite. 2) Al future debenture requirements are assumed to be financed in a fvFC "FALL" debenture. 3) The above D.S.R's includes those debentures held by HRM which HRWC reinturses HRM. 4) Al future borrowings assumed for '20' years, using "serial" debentures. Any "balloons" refinanced at same interest rates.

s Charge s inf Funding s Regional Dev Cap from Op s s Depreciation s Sale of Land Debt 0.00% 2.79% 0.00%
NAIRWillIMIN1 1,857,358,565 2,640,470,788

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0.06%
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Alternative #3 - Base case (Alternative #1) with Increased funding from depreciation resulting from depreciation on existing contributed assets from 2015 onward. Regional Development Charge revenue doubled in the near future to yield $197 million. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is a doubling of revenue from the Regional Development Charge. It does not include cost sharing from federal and provincial government to cover a portion of the cost of capital projects. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 49% from Borrowing 46% from depreciation 5% from RDC WACD = 4.62% 36.03% 2 Max 302% in 2031-32 20 years $891 M 52.67% max 2031-32 4 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42% HRWC weighted cost of debt 2032-33 0 years over 40% 157% in 2042-43
$317 million At current MFC rates (3.62% for 20 yrs.) the DSR would exceed 35% in 0 of the years over the period. Max 1.98% in 2033-34
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Debt
Fiscal 2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 204243 2043-44 2044-45 2045-46 2046-47 2047-48
D.S.R.
20,69% 18.40% 13.36% 19.30% 21.86% 25.13% 24.68% 23.11% 26.45% 29.11% 24.71% 33.39% 31.95% 30.89% 30.06% 30.75% 30.52% 30.75% 32.21% 34.50% 36.03% 35.52% 33.73% 32.41% 30.54% 28.83% 27.72% 28.58% 25.94% 24.34% 21.70% 21.18% 20.21% 19.00% 17.81% 16.55%
Revenues 109,753,580 123,411,455 138,152,128 149,455,481 163,139,605 175,382,140 186,148,309 194,446,997 201,233,011 214,125,066 232,017,407 244,085,753 243,126,180 243,949,881 253,683,810 252,698,215 261,474,799 269,912,422 275,291,530 294,373,406 308,969,844 315,130,101 316,739,660 316,792,284 316,845,960 313,769,196 313,825,041 313,882,003 313,940,104 313,999,367 310,959,616 311,021273 311,084,163 311,148,312 311,213,743 311.280.483
Borrowing 0 65,077,003 41,294,000 78,331,500 83,693,000 62,226,750 89,596,000 58,853,000 96,786,000 164,083,000 103,801,315 18,067,000 33,255,000 34,039,000 39,680,000 45,413,000 59,514,000 91,808,000 163,491,000 133,222,000 58,812,000 16,163,000 7,617,000 11,765,000 9,160,000 26,794,003 38,257,000 34,865,000 25,652,000 18,390,000 51,373,000 0 0 0 0 0
Servicing 15,600,907 22,712,820 28,456,893 31,338,719 37,669,881 44,080,719 47 ,444,961 51,445,104 54,923,053 62,327,787 74,524,028 81.512,198 77,683,914 75,353,836 76,261,361 77,694,470 79.796,673 83,003,952 88 ,683,903 101,561,638 111,323,759 111,939,791 106,822,844 102,665,912 96,775,837 90,470,080 87,001,577 83,424,202 81,422,794 76,438,844 67,466,831 65,878,334 62,855,935 59,115,872 55,413,427 51.507.562
Debt 0/S
182,557,458
232,033,551 254,806,008 312,543,910 371,876,461 406, 037,335 465, 710,637 493,291,974 556,428,114 682, 297 .707 741,431,794 709, 741.800 695,530,977 683,746,883 676,151,839 672,505,795 680,690.101 718,342,707 823, 737 ,913 890,859,569 876, 910 ,125 819,090,912 755,171,400 696,583,737 638,594,400 601, 865,712 578, 371,662 553,977,562 521, 244,862 484, 721,862 488,466 ,512 442,599,662 397,636,162 354, 335,412 312, 736,612 273,121.812
100.00% 95.00% 90-00% 85.00% 80.00% 75_00% 70.00% 65.00% 6100% 55.00% .50.00% 45.00% 40.00% 35_00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00%
Projected Debt Service Ratio of Halifax Regional Water Commission
1 I I
19 \ll I'
1 15
-6"
1>
i>
1?
1.:\
"k
4 o?
iP
"
4?
1.''s
'
the above D.S.8.'s are bared 011 using fi5MFC's5pring21012 debenture interest rates. Assumptions: 1) All current debentures with balloon payments are refinanced for their remaining life.
2)At future debenhre requirements are assumed to be financed in a MFC "FALL" debenture.
3) The abokie D.S.R's includes those debentures held by HRM which HRWC reimburses HRlvt 4)Al future borrowings assumed for "20" years, using "serial" debentures. Any "balloons" refinanced at same interest rates.

s inf Funding s Regional Dev Charge Cap from Op s Depreciation s Sale of Land s Debt
Total
9,236,462,327 1,761,078,565 2,522,620,416
December 31, 2012

LICL.CI I IIJC I .31, LL/_LE_
January 9, 2013
Page 685
q+11alifax
Water

Page 53
Alternative #4 - Base case (Alternative #1) with increased funding from depreciation on existing contributed assets from 2015 onward. Federal / provincial capital grants of $432 million added in this scenario. Regional development charge revenue unchanged from $100 million. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is $432 in federal / provincial grants. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 40% from Borrowing 46% from depreciation 3% from RDC 12% from grants Revenues from depreciation plus grants match asset renewal expenditures WACD = 4.62% 32.06% 0 Max 296% in 2031-32 20 years $721 M 47.40% max 2031-32 0 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42%
Accumulated surpluses are below 2% of revenue for most of the period. In 2035-36 Interest rates at 1% above WACD would result in a DSR of over 35% in 0 of the 30 years 1.53% in 2042-43
$295 million At current MFC rates (3.62% for 20 yrs.) the DSR would exceed 30% in 0 years over the period. Max 1.867 % in 2033-34
December 31, 2012
January 9, 2013
Page 686
tIJ Ilalifax
Water
HRWC Debt Service Retie Analysis

Page 54

Fiscal
2013/14 2(13-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2028-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 203E1-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046-47 2047-48 Total
D.S.R.
20.69% 18.40% 13.30% 19 45% 22.17% 25.41% 25.14% 23.60% 26.54% 28.97% 23.95% 30.73% 29.45% 28.52% 28.08% 28.70% 26.59% 28.79% 29.44% 31.32% 32.06% 30.56% 28.75% 27.23% 25.19% 23.38% 22.10% 20.77% 20.01% 18 43% 16.20% 16.38% 15.47% 14.32% 13.18% 11.98%
Revenues
109,753,580 123,411,455 138,737,323 149,759,808 163,472,638 176,523,017 186,528,002 195,749,141 201,915,591 213,380,633 227,579,921 235,540,740 234,616,890 235,983,366 244,822,788 246,256,064 254,199,672 262,400,853 265,039,123 278,170,305 289,209,248 294,974,293 295,025,885 295,078,509 292,217,809 289,387,326 289,443,171 289,500,133 292,414,614 292,473,877 291,091,854 291,153,511 291,216,401 291,280,550 291,345,981 291,412,721
Borrowing
0 65,077,000 44,315,632 81,353,132 85,819,528 64,353,278 92,916,000 49,985,200 87,918,200 118,649,136 58,367,451 21,387,000 38,575,000 37,359,000 43,000,000 42,232,840 54,034,142 56,438,062 121,222,634 85,785,474 20,573,600 7,951,210 (594,790) 3,553,210 948,210 18,582,210 30,045,210 26,653,210 17,440,210 10,178,210 43,161,210 0 0 0 0 0
Debt Servicing
15,600,907 22,712,820 28,456,893 31,629,400 38,244,263 44,845,713 48,395,655 52,691,397 55,284,811 61,825,492 69,660,512 72,392,411 69,102,932 87,303,988 68,734,979 70,683,684 72,68E1,899 75,545,106 78,031,216 87,133,187 92,720,006 90,155,175 84,834,255 80,361,238 73,605,716 67,650,309 63,964,882 60,134,791 58,516,696 53,914,542 47,151,114 47,685,219 45,051,720 41,708,225 38,410,019 34,916,062
Debt 015
182,557,458 232,033,551 257,827,640 318,436,093 379,593,009 415,471,921 477,950,406 495,983,128 550,014,041 630,655,734 646,833,615 623,212,971 816,905,498 612,858,755 612,835,061 610,094,206 817,043,014 623,844,033 893,257,721 721,343,118 679,927,367 626,580,377 567,543,677 514,400,498 462,952,626 432,717,269 416,233,466 399,426,202 374,247,538 345,245,773 354,650,555 320,794,523 288,007,841 257,049,909 227,959,927 201,019,944 Assumptions: 100.00% 95.00% 90.00% 85.00% 80.00% 75.00% 70.00% 65.00% 60.00% 55.00% 50.00% 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00%
15 .
ce i
"5 N
'7)
" -0' le
19 ' 1
19 1"
4 .R) P 1 ,o , ,0 4)' 9 ,0"
The above D.S.R.'s are based on using NSMFC's Spring 2012 debenture interest rates.
1) Al current debentures with balloon payments are refinanced for their remaining He. 2) Al future debenture requirements are assumed to be financed in a !AFC "FALL" debenture. 3) The above 17/5_Ft's includes those debentures held by FIRM which HRWC reimburses FRIN. 4) Al future borrowings assumed for "20" years, using "seriar debenture& Any "balaons" refinanced at same interest rates.

la Funding s R000001 0E, Cho s rge rip from Op Depreciation Se le of tend Debt
2.79% 8,811,066,614 1,425,280,409 2,111,724,432 0.00%

January 9, 2013
0.06%
Page 687
q+11alifax
Water

Page 55
Alternative #5 - Base case (Alternative #1) with increased funding from depreciation on existing contributed assets from 2015 onward. Federal / provincial capital grants of $432 million added in this scenario. Regional development charge revenue doubled in the near future to yield $197 million. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is $432 in federal / provincial grants and an increase in Regional Development Charge revenue to $197 M. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 37% from Borrowing 46% from depreciation 5% from RDC 12% from grants Revenues from depreciation plus grants match asset renewal expenditures WACD = 4.62% 30.78% 0 Max 288% in 2021-22 20 years $687 M 46.27% max 2031-32 0 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42
Accumulated surpluses are below 2% of revenue for most of the period. In 2035-36 Interest rates at 1% above WACD would result in a DSR of over 35% in 0 of the 30 years 1.50% in 2042-43
December 31, 2012
January 9, 2013
Page 688
tIJ Halifax Water

Debt Servicing
15,600,907 22 ,712,820 28,456,893 31,310,016 37,613,164 43,910,568 47 ,164,134 51,171,169 53,483,545 59,750,858 67,320,177 69,794,046 66,254,206 64,212,570 65,408,538 67,130,090 68.895,420 71,559,612 73,841,376 82,746,670 88,144,482 135,398,312 79,903,723 75,430,706 65,687,184 63,023,822 57,196,115 55,710,174 54,078,931 49,463,630 42,687,054 43,208,010 40,880,748 37,835,820 34,828,511 31.617,782

Page 56

Debt 01S
182, 557,458 232, 033,551 254,507,640 311, 962,093 370,131,009 403,187,921 463, 010 ,406 478, 553,128 530, 260 ,041 608, 743,734 622,929,615 597,482,971 589,515,498 583,974,755 582,623,061 578,720,208 584,673.014 590,644,033 659,393,721 686, 981,118 645,233,367 591,720,377 532,683,677 479,540,498 431, 080,626 400,679,269 386,164,077 369,072,224 343,608,970 314, 322,616 323,442,808 292,622,186 262,704,915 234,450,393 207,897,822 Assumptions: 1) All current debentures with balloon payments are refinanced for their remaining life. 2) Al future debenhre requirements are assumed to be financed in a MFC "FALL" debenture. 3) The aboke D.S.R.'s includes those debentures held by HRM which HRWC reimburses HRM 4) Al future borrowings assumed for "20" years, using "serial" debentures. Any "balloons" refinanced at same interest rates.
The above D-5--.5 are
Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-48 2046-47 2047-48
D.S.R.
20.69% 18.40% 14.33% 19.28% 21.89% 24.99% 24.63% 23.01% 25.90% 28.28% 22.29% 29.99% 28.58% 27.54% 27.11% 27.79% 27.57% 27.80% 28.40% 30.04% 30.78% 29.38% 27.49% 25.94% 23.04% 22.11% 20.06% 18.53% 18.96% 17.34% 14.96% 15.14% 14.32% 13.25% 12.19% 11.07%
Revenues
109,753,580 123,411,455 128,789,012 149,392, 020 162,713,692 175,701,827 185,396,884 194,111,586 199,943,239 211,295,023 224,840,509 232,704,715 231,792,454 233,142,984 241,308,187 241,547,398 249,933,702 257,379,639 259,967,697 275,411,106 286,339,682 290,633,067 290,684,659 290,737,283 285,049,030 285,103,780 285,159,625 285,216,587 285,274,688 285,333,951 285,394,400 285,456,057 285,518,947 285,583,096 285,648,527 285,715,267
Borrowing
0 65,077,000 40,995632 78,033,132 82,499,528 61,033,278 89,596,000 46,665,200 84,598,200 115,329,136 55,047,451 18,067,000 33,255,000 34,039,000 39,680000 38,912,840 50.714,142 53,118,062 117,902,634 82,465,474 17,253,600 4,631,210 (3,914,790) 233,210 (2,371,790) 15,262,210 26,725,210 23,333,210 14,120,210 6,858,210 39,841,210 0 0 0 0 0

100.00% 95.00% 90.00%
85.00% 80.00% 75.0C% 70.00%

65.00% 60.00%
55.00% 5000% 45.00% 40.00%

35.00%
10.00% 25.00% 20.00% 15.00% 1000% 5.00% 0.00%

(0 ,i
1 +
11' 1,
ì. `1, 4 4') `4' . 4 ' 4' 4 1 9
based on using tdracs-spdni 2012 debenture interest rates.

let Funding s s Op Regional Dev Charge - Cap trot
s Depreciation s Sale of Land s Debt
183,329,250
546%
Total
8,671,385,360 1,329,000,409 1,993,431,783
0.00%
0.06%
December 31, 2012

LICL.CI I IIJC I .31, LL/_LE_
January 9, 2013
Page 689
q+11alifax
Water

Page 57
Alternative#6 - Base case (Alternative #1) with increased funding from depreciation on existing contributed assets from 2015 onward. Federal / provincial capital grants of $432 million added in this scenario. Regional development charge revenue is sufficient to pay for all growth related costs. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is $432 in federal / provincial grants and an increase in Regional Development Charge revenue to $693 M. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 23% from Borrowing 46% from depreciation 19% from RDC 12% from grants Financing sources well matched with drivers if grant funds are allocated to asset renewal WACD = 4.62% 24.12% 0 Max 246% in 2021-22 20 years $501 M 38.41% max 2031-32 0 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42%
December 31, 2012
January 9, 2013
Page 690
tIJ Ilalifax
Water

Page 58
HRWC Debt Service Ratio Analysis Debt Servicing
15,600,907 22,712,820 26,763,363 28,186,806 33,095,581 37,898,023 39 ,695,196 42,284,408 43,217,530 48,144,160 54,625,591 56,044,997 51,484,119 48,454,873 48,696,655 48,845,335 49.086,878 50,276,367 51,132,514 58,661,275 63,287,175 59,804,840 54,490,041 40,317,456 27,458,129 26,527,090 21,952,001 35,647,881 34,216,727 29,588,272 21,466,036 15,450,162 23,028,846 21,293,370 19,562,088 17,932,896
Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046-47 2047-48
D.S.R.
20.69% 18.40% 12.24% 17.49% 19.64% 22.31% 21.49% 19.38% 21.91% 24.10% 17.61% 25.72% 23.72% 22.19% 21.70% 21.80% 21.27% 21.26% 21.62% 23.30% 24.12% 22.79% 20.61% 15.71% 11.02% 10.65% 8.81% 13.76% 12.76% 11.04% 8.08% 5.82% 8.67% 8.01% 7.36% 6.75%
Revenues
109,753,580 123,411,455 136,981,739 146,882,404 158,362,253 169,858,034 177,771 A81 184,830,445 189,484,125 199,775,536 212,574,189 217,939,764 217,088,881 218,355,350 224,406,977 224,087,113 230,758,110 236,491,456 236,539,119 251,742,570 262,345,169 262,395,750 264,388,785 256,617,392 249,081,771 249,136,521 249,192,366 259,064,819 268,055,016 268,114,280 265,533,379 265,595,037 265,657,927 265,722,075 265,787,507 265.854,247 8,049,636,621
Borrowing
0 47,472,740 25,711,372 62,748,872 65,802,628 44,336,378 72,899,100 29,968,300 67,901,300 100,859,106 40,577,421 3,596,970 15,784,970 19,568,970 18,431,260 17,664,100 29,465,402 31,869,322 96,653,894 66,991,554 1,779,680 (1u,842,710) (19,388,710) (15,240,710) (17,845,710) (211,710) 11,251,290 7,859,290 (1,353,710) (8,615,710) 24,367,290 0 0 0 0 0
Debt 0/S
182,557,458 214,429,291 222,499,333 266,313,952 310,194,607 329,798,103 377,002,017 380,761,013 421,519,045 492,115,572 499,137,788 467,250,981 453,566,847 443,032,944 430,632,882 416,744,097 413,773.408 411,883,370 473,834,438 501,460,471 460,525,052 408,598,091 351,040,902 309,145,157 275,568,155 259,004,934 257,714,582 239,276,736 212,205,215 181,249,445 189,968,754 180,739,479 163,505,128 147,210,026 131,893,372 117,498,280
100.00% 95.00% 90.00% 85.00% 80.00% 75.00% 70.00% 65.00% 60.00% 53.00% 50.00% 45.00% 40.00% 35.00% 30.00%
25.00%
20.00% 15.00% 10.00% 5.00% 0.00%

4, ( , ;
ne
'1/ 1
't) 4\ )
0 0
.-f)% ,t 61
'
The above D.S.R.'s are based on using SNIFC's Spring 2012 debenture interest rates.
Assumptions: 1) All current debentures with balloon payments are refinanced for their remaining life. 2) Al future debenhre requirements are assumed to be financed in a MFC "FALL" debenture 3) The aboke D.S.R's includes those debentures held by HRM which HRWC reimburses HRM 4) Al future borrowings assumed for "20" years, using "serial" debentures. Any "balloons" refinanced at same interest rates.

s Int Funding s Op s Regional Dev Charge - Cap from Depreciation s Sale of Land s Debt
Total
833,062,239 1,366,930,408 0.06%
1 I II I
I. 0 0 % PO
December .31, LL/_LE_ LICL.CI I IIJC I 31, 2012

January 9, 2013
Page 691
q+11alifax
Water

Page 59
Alternative #7 - Base case (Alternative #1) with increased funding from depreciation on existing contributed assets from 2015 onward. Federal / provincial capital grants of $432 million added in this scenario. Regional development charge revenue is sufficient to pay for 50% of all growth related costs. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is $432 in federal / provincial grants and an increase in Regional Development Charge revenue to $346 M. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 32% from Borrowing 46% from depreciation 10% from RDC 12% from grants WACD = 4.62% 28.90% 0 Max 276% in 2021-22 20 years $629 M 43.99% max 2031-32 0 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42%
December 31, 2012
January 9, 2013
Page 692
tIJ Ilalifax 1 1 Water

Debt

Page 60
Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046-47 2047-48 Total
D.S.R.
20.69% 18.40% 12.90% 18.75% 21.14% 24.23% 23.55% 22.01% 24.67% 27.04% 20.93% 28.76% 27.27% 26.10% 25.62% 26.02% 25.65% 25.75% 26.44% 28.10% 28.90% 27.43% 25.54% 24.20% 19.69% 18.96% 16.92% 17.81% 17.06% 15.42% 12.98% 13.16% 12.47% 11.52% 10.58% 9.62%
Revenues 109,753,580 123,411,455 138,152,128 148,140,096 161,700,147 173,445,004 184,066,596 190,485,050 197,131,502 207,843,200 221,164,897 228,361,791 226,912,257 228,234,886 236,226,775 237,036,259 245,264,673 252,570,539 252,618,203 267,820,642 278,237,599 282,409,453 282,461,045 279,724,941 274,256,935 274,311,684 274,367,529 277,130,116 279,920,897 279,980,160 280,040,609 280,102,266 280,165,157 280,229,305 280,294,736 280,361,476
Borrowing 0 58,434,870 36,673,502 73,711,002 77,471,078 56,004,828 84,567,550 41,636,750 79,569,750 111,414,121 51,132,436 14,151,985 29,339,985 30,123,985 32,375,630 31,608,470 43,409,772 45,813,692 110,598,264 78,048,514 12,836,640 214,250 (8,331,750) (4,183,750) (6,788,750) 10,845,250 22,308,250 18,916,250 9,703,250 2,441,250 35,424,250 0 0 0 0 0
Servicing 15,600,907 22,712,620 27,817,920 30,270,597 36,183,284 42,032,263 44,849,019 48,430,860 50,329,658 56,195,008 63,481,094 65,680,772 61,875,784 59,578,046 60,526,954 61,684,434 62,902,566 65,036,432 66,804,743 75,213,458 80,409,332 77,471,428 72,127,414 67,683,833 53,994,701 52,010,923 46,410,048 49,346,373 47,746,011 43,160,177 36,355,986 36,850,486 34,922,838 32,268,481 29,642,699 26,973,921
Debt
01$

100.00% 95.00% 90.00% 85.00% 60.00% 75.00% 70.00% 65.00% 60.00% 55.00% 50.00% 15.00% 10.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% ti n 4" 6' 19 4" 4' F f
182,557,458 225,391,421 243,875,486 297,556,022 351,460,808 380,505,012 436,566,212 448,599,070 497,047,543 573,637,653 586,125,701 559,176,976 549,903,173 543,251,849 537,595,971 529,754,152 532,133,211 534,895,702 600,802,080 828,798,794 587,681,210 535,019,234 476,722,290 424,323,608 380,588,239 354,450,073 344,168,199 327,082,978 301,595,781 272,254,910 281,345,682 254,937,698 229,237,313 205,003,927 182,276,740 161,168,335
>
n6' 19 19 1.9
19
4b1 4'
1g'
The above 0.5.8:5 are based an using NSMFC's Spring 2012 debenture interest rates. Assumptions: 1) All current debentures vtith beloon payments are refinanced for their remaining life. 2) All future debenture requirements are assumed to be financed in a MFC "FALL" debenture. 3) The above D_S.R's includes those debentures held by HRM utiich HRWC reimburses HRM. 4) AI future borrowings assumed for "20" years, using "seriar debentures. Any "balloons" refinanced at same interest rates.

s inf Funding s Op s Regional 0ev Charge sSale of Land s Cap from Depreciation s Debt
8,494,133,591 1,179,471,324 1,804,581,271
0.00%
0.06% 11 11/1 1
December 31, 2U12 December 31, 2012

January 9, 2013
Page 693
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Water

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Alternative #8 - Base case (Alternative #1) with increased funding from depreciation on existing contributed assets from 2015 onward. Federal / provincial capital grants of $432 million added in this scenario. Regional development charge revenue is sufficient to pay for 75% of all growth related costs. Debt issued for all projects amortized over 20 years. Current HRWC weighted cost of debt used in interest rate calculations. SCENARIO DESCRIPTION - This scenario provides for the depreciation of existing (and future) contributed assets. The additional source of revenue beyond the base case is $432 in federal / provincial grants and an increase in Regional Development Charge revenue to $520 M. The current weighted average cost of HRWC debt (WACD) is used as the long term interest rate in projecting debt service costs. The impact of variations in interest rates in calculated using the current HRWC cost of borrowing through the MFC (one per cent below the WACD) and a rate of one percent above the WACD. % financing from LT Borrowing and other sources 28% from Borrowing 46% from depreciation 14% from RDC 12% from grants WACD = 4.62% 26.47% 0 Max 261% in 2021-22 20 years $565 M 41.42% max 2031-32 0 years over 50% Drivers: Compliance 23.2% Asset renewal 57.38% Growth 19.42%
Interest rates Debt Service Ratio HIGH Number of years DSR over 35% Debt as a % of annual revenue Amortization period of loans Maximum debt outstanding Debt outstanding/ capital under management. No. of years over 50% Accumulated deficit /surplus year end maximum
Accumulated surpluses are less than 2% of operating revenues in all but 4 years. These can be adjusted. In 2042-43 Interest rates at 1% above WACD would result in a DSR of over 30% in 0 of the 30 years 1.44% in 2042-43
Operating revenue peak amount Interest rate sensitivity impact
$274 million At current MFC rates (3.62% for 20 yrs.) the DSR would exceed 25% in 0 years over the period. Max 1.74% in 2032-33
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1 1. Water
HIRING Debt Service Ratio Analysis

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Debt
Fiscal
2013/14 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-29 2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35 2035-36 2036-37 2037-38 2038-39 2039-40 2040-41 2041-42 2042-43 2043-44 2044-45 2045-46 2046-47 2047-48 Total
O.S.R.
20.69% 18.40% 12.62% 18.12% 20.45% 23.29% 22.60% 20.62% 23.33% 25.61% 19.31% 27.19% 25.67% 24.21% 23.65% 24.02% 23.52% 23.63% 23.93% 25.88% 26.47% 25.04% 23.09% 20.22%
Revenues
109,753,580
Borrowing
0
Servicing
15,600,907
Debt 0/S
182,557,458

100.00% 95.00%
123,411,455 136,981,739
147,534,327 159,629,690 171,601.663 180,441,531 188,483,010
52,953,805 31,192,437
68,229,937 71,636,853 50,170,603 78,733,325 35.802,525
22,712,820 27,290,641
29,228,70 34,639,433 39,985,143 42,272,107 45,357,634
219,910,356 233,187,400
281,934.987 330,827,707 355,151.557 406,784.115
9000%
85.00%
80.00% 75.00% 70.00% 55.00% 50.00% 55.00% 50.00% 45.00% 40.00%

35.00% 30.00% 25 00%
193,229,341 203,726,583 216,781,391 223,834.493 220,782,436 223,143,116 230,955,206 230,063,119

238,047,474 243,963,054 246,416,946 258,617,018 271,425,636 274,156.613 274,207,205 267,494,354
73,735,525 106,136,614 45,854,929 8,874,478 24,062,478 24,846,478 25,403,445 24,638,285

36,437,587 38,841,507 103,626,079 72,520,034 7,308,160 (5,314,230) (13,860,230) (9,712,230)
46,773,594 52,169,584 59,053,342 60,862,885 56,679,952 54,016,459 54,611,805 55,264,885

55,994,722 57,656,400 58,988,629 66,937,367 71,848,254 68,638,134 63,308,728 54,097,057
414,680,042 459,283,294 532,876,613 542,631,745 513,213,979 501,735,010 493,142,397 484,114,427 473,249,124

472,953,310 473,389,536 537,318,250 565,129,633 524,103,131 471,808,663 413,881.596
20.00% 15.00% lam%

5.00% 0.00%
15.60% 15.04%
13.09%
15.92% 14.94% 13.26% 10.75% 9.90%

10.49%
260,951,692 261,006,442 261,062,287 267,550.678 274,200,995 274,260,258 274,320,707 274,382,364

274,445,254 274,509,403 274,574,834 274,641,574
(12,317,230) 5,316,770 16,779,770 13,387,770 4,174,770 (3,087,230) 29,895,770 0

0 0 0 0
40,716,605 39,259,444 34,171,709 42,583,329 40,962,854 36,356,202 29,502,649 27,169,881

28,787,087 26,597,046 24,423,389 22,279,279
366,637,970 327,987,140 306,641,804 300,861,047 283,009,600 256,740,890 226,603,218 234,909,739 216,037,038

194,675,193 174,516,472 155,600,075 137,953,849
-6'
i) ;"
-V 4 -1.9 ^6' 19
It,
"3,
The above 1:1.5.R.'s are based on using NS/AFC's Siring 23112 del:ion -lee interest rates.
Assumptions: 1) Al Current debentures 451 balcon payments are refinanced for their remaining ire. 2) All future debenihre requirements are assumed to be financed in a lFC TALL" debenture. 3) The above D.S.R's includes those debentures he by FIRM which l' WC reimburses HAM. future borrowings assumed for "20" years, using "senor debentures. Any "balloons" refinanced at same interest rats.
9.59%
8.89% 8.11%

sDee Charge Cap hem Op I of Funding s Regional
8,280,586,468 1,006,266,782 1,586,758,635
s s Depreciation s Sale of Land Debt

1198%
0.06%
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Appendix D Study of Efficient Funding Mechanisms for HRWC
Terms of Reference
Introduction, issues and context
On December 17, 2010 the Nova Scotia Utility and Review Board rendered a decision on an application by Halifax Regional Water Commission (HRWC) for Approval of a Schedule of Rates and Charges and Schedules of Rules and Regulations for the Provision of Water, Public and Private Fire protection, Wastewater and Stormwater Services. The application included a Capital Debt Policy which the Board was not prepared to approve stating it did not accept that the 30/70 debt to equity ratio included in the debt policy to be an efficient one. The Board directed HRWC to undertake a complete study which examines an efficient capital structure, policies of other utilities, its longer term capital needs, and options that would result in an efficient funding mechanism which is fair to present and future ratepayers. As a local government enterprise (LGE), there are a number of factors that must be considered when determining debt guidelines and efficient funding mechanisms for HRWC. The methodologies used to determine component and optimal costs of capital for corporately owned utilities are different from municipally owned utilities where, for ratepayer generated funds, debt, capital out of revenue, and retained earnings are the only sources of capital financing. However inter-generational equity is an important consideration in formulating municipal debt policies as are provincial government laws and regulations and professional standards and guidelines. In Nova Scotia municipal debt is acquired through the Nova Scotia Municipal Finance Corporation (NSMFC). There is an approval and issuance process, which includes both NSMFC and Service Nova Scotia and Municipal Relations, which must be followed by all borrowers. The impact of HRWC debt on HRM debt limits and policies as well as the current NSMFC requirement that HRM guarantee of most HRWCs debt is also a consideration in the development of an efficient capital structure. The study will focus on the four areas identified in the Board Order and recommend an efficient funding mechanism that is fair to present and future ratepayers. This will be carried out within the context of a local government enterprise providing water, wastewater, and storm water services in Nova Scotia.
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Components of the study

The five study components are listed below. They include the four areas specified in the Board Order plus a fifth one to ensure the municipal finance and governance framework in Nova Scotia is reflected in the study outcomes. 1. 2. 3. 4. 5. Examination of an efficient capital structure for water, wastewater, and storm water utilities Policies of other utilities HRWC long term capital needs Options for a funding mechanism which is fair to present and future ratepayers Integration of the above components within the municipal finance and governance framework in Nova Scotia and NSMFC policies relating to municipal guarantees of local government enterprises.
Individual factors to be considered for each component

Under Efficient capital structure 1. The capital intensive nature of the industry 2. Finance theory on capital structure 3. Comparing the cost of the components of the capital structure for municipal utilities or government business enterprises with the cost of funds for private enterprises and public companies 4. Cost of capital considerations for a local government enterprise 5. Analysis of the risk associated with various capital structure options 6. Inter-generational equity issues as a determinant of capital structure Under Policies of other utilities 1. 2. 3. 4. 5. 6. Selection of utilities for comparative purposes Canadian comparison water, wastewater and storm water American comparison water, wastewater and storm water Other country comparisons water, wastewater and storm water Comparison of policies for privately owned and municipally owned (LGE) utilities Comparison of policies for stand-alone utilities providing the services compared with policies for water and sewer provided as part of general municipal operations
Under HRWC long term capital needs This section will be covered by the Integrated Resource Plan (IRP) which is being prepared separately. It is expected to include:
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1. Discussion of policies (e.g. development charges, capital contributions) that impact on long term capital requirements 2. Development stage of the municipality or parts thereof (growth, mature, decline) 3. A detailed capital program (Board requirement for an Integrated Resource Plan 4. Senior government financial support of capital projects 5. Impact of water, wastewater, and stormwater capital costs as a result of government regulations and standards. 6. New, upgraded or expanded facilities versus system maintenance, renewal and upgrades Under Options for a funding mechanism which is fair to present and future ratepayers 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. Cap considerations on debt service ratios for selected debt to equity ratios Pay as you go Reserve funds Depreciation funds Link with asset life and term of debt Term of debt considerations Interest rate / cost of borrowing sensitivity impacts Use of debt versus capital out of revenue / depreciation Inter-generational equity considerations Stability of rate base Projected rate of growth or decline in revenues HRWC rate supported versus HRM tax supported debt Apply time value of money analysis to compare alternatives Limitations on debt service costs set by the Minister of Service Nova Scotia and Municipal Relations (SNSMR), NSMFC and HRM
Under Integration of the above components within the municipal finance and governance framework in Nova Scotia 1. Ensure all municipal requirements of the NSMFC and SNSMR are considered when establishing debt / equity ratios, debt service ratios, amortization periods for infrastructure financing, and debt guarantees. 2. Ensure any impact on HRMs credit ratings and debt limits are considered when formulating HRWCs debt policy. 3. Identify and assess any debt policy considerations resulting from the NSMFC policy requiring a guarantee of HRWCs debt by HRM.
Sources of information
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1. Debt policy literature: Government Finance Officers Association (GFOA), American Water Works Association, Rating agencies 2. Literature on inter-generational considerations in the public sector financial decision making process 3. Debt policy samples from selected Canadian and American utilities (regulated and unregulated) 4. Investment firms issuing utility and/or municipal bonds 5. HRWCs long term capital program / Integrated resource plan 6. Halifax Regional Municipality Finance department on guarantees and HRM debt constraints 7. NSMFC 8. Other Municipal finance Authorities 9. Province of NS through Service Nova Scotia and Municipal Relations 10. Nova Scotia Utility and review Board Decision dated December 7, 2010 on HRWCs application for approval of a Schedule of rates and Charges and Rules and Regulations for the provision of Water, Public and Private Fire Protection, Wastewater and Stormwater Services.
Resources
Coordinator and lead: Mark Gilbert PhD Professor Dalhousie University Faculty of Management and former CEO Nova Scotia Municipal Finance Corporation Input on data and information gathering: Blaine Rooney CA Director of Finance and Customer Service and staff of Halifax Regional Water Commission Supplementary resource: Outside consultant with experience in assessing water / wastewater utility and municipal capital structures Investment dealer specializing in the issuance of Government debt
Methodology
The study will be undertaken in three phases. The first phase will begin with a review of published and public materials which will be followed by direct contact with representatives of the utilities, municipalities and other entities referred to under each of the five components. The information will be organized in report format and address the issues the Board directed HRWC to undertake in this study. The second phase will be undertaken once the HRWCs long term capital needs are identified through the Integrated Resource Plan (IRP) which is being prepared separately. During this phase a financial analysis of the funding mechanism alternatives and ratios will be undertaken using the data provided by the IRP.
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The third phase involves synthesizing the results of the first two phases and identifying alternatives. A preferred alternative for an efficient funding mechanism which is fair to present and future ratepayers, and will include a revised debt policy, will be recommended.
Timelines
Phase One: March 2011 to June/July 2011 Phase Two: Thirty days following completion of the IRP which is expected between August and October 2012 Phase Three: Thirty days following the completion of Phase Two
Dated: February 10, 2011
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Appendix E Bibliography
Federation of Canadian Municipalities. Keep Moving forward. Pre-Budget Submission Fall 2011. On FCM website Fundamentals of Water Utility Capital Finance: manual of water supply practices. Third Edition 2008. American Water Works Association (AWWA) Infra Guide: Innovations and Best Practices: National Guide to Sustainable Municipal Infrastructure: Water and Sewer Rates: Full cost recovery (March 2006) Financing and charges for wastewater systems. Water Environment Federation (WEF) Manual of Practice No. 27 (USA) 2004 Government Finance Officers Association (GFOA) of the United States and Canada. Best Practice Debt Management Policy (1995 and revised in 2003) Government Finance Officers Association (GFOA) of the United States and Canada. Benchmarking and measuring debt capacity. Miranda and Picur (2000) Raftelis Financial Consultants Inc. AWWA/RFC 2008 Water and Wastewater Rate Survey Group A Water Utilities. Debt/equity ratios. Presented in exhibit format at a rate case in Milwaukee, WI on July 19, 2010 Standard & Poors. Methodology for rating international local and regional governments (LRGS). September 20, 2010 Standard & Poors. Global Credit Portal: Ratings Direct. Halifax Regional Municipality. April 5, 2011 Standard & Poors. June 8, 2011 meeting with S&P in Halifax to discuss rating criteria, financial ratios, and the link between HRWC debt and the HRM credit rating. Standard and Poors revised criteria for rating water, sewer and drainage utility revenue bonds. September 15, 2008 p.3 Standard and Poors Ratings direct of the Global credit Portal for Investor owned water companies: Northumbria Water Ltd. April 7, 2011; Sutton and East Surrey PLC Dec 21, 2010; Wessex Water Services Ltd. Nov 5, 2010, American Water Works co. Inc July 28, 2010.
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Appendix F Consultants short CV

Mark Gilbert is a professor with the School of Public Administration, Dalhousie University in Halifax Nova Scotia. Prior to joining Dalhousie in 2008, he served as CEO for the Nova Scotia Municipal Finance Corporation and held a number of other local government related management positions. He has participated in international local government finance reform projects in a number of countries which include South Africa, Indonesia, India and Bosnia. His current research focuses on the municipal financial implications of urban sprawl, local government use of alternative service delivery, and advocacy strategies of organized local government. He is also involved in financial preparedness for retirement research. Dr. Gilbert is academic advisor to GFOAs Committee on Canadian Issues and a past GFOA executive board member. He is a past board member of the Institute of Public Administration of Canada (IPAC) and a team lead (Indonesia) in IPACs, CIDA funded, Democratic Governance Program. In 2012 he was the recipient of the Dalhousie Faculty of Management Advisory Board Chairmans award for External Impact. He holds an MBA in Finance from Dalhousie University and a PhD in Management from the University of Bradford. His doctoral thesis focused on the credit enhancement of municipal debt.
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APPENDIX 10
Regional Development Charge Policy Interim Report

December 2012
Prepared by Halifax Regional Water Commission

In association with: G. A. Isenor Consulting Limited Blaine S. Rooney Consulting Limited R. M. Loudon Limited
January 9, 2013
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Regional Development Charge Policy Review Interim Report Table of Contents

Glossary.............................................................................................................................................5 1.0 2.0 3.0 Introduction ..........................................................................................................................6 Background ...........................................................................................................................6 Discussion Papers ..................................................................................................................8 3.1 3.2 3.3 3.4 3.5 Infrastructure Drivers ..................................................................................................... 8 Infrastructure Requirements to Facilitate Development ................................................. 8 Existing Regional Charges ............................................................................................... 9 Options and Considerations for the New Charge .......................................................... 10 Evaluation of Options ................................................................................................... 14 3.5.1 Status Quo Retain Existing Charges ................................................................ 15 3.5.2 Availability Charge............................................................................................ 15 3.5.3 Proposed RDC ................................................................................................... 16 3.6 Factors Influencing Charges.......................................................................................... 16 3.6.1 Influencing Factors............................................................................................ 17 3.6.2 Options for Regional Development Charge Collection........................................ 18 3.7 Calculation of the Proposed Charge.............................................................................. 19 3.7.1 Estimated Growth............................................................................................. 19 3.7.2 Projected Infrastructure Costs ........................................................................... 20 3.7.3 Calculation Details ............................................................................................ 20 4.0 Stakeholder Consultation.....................................................................................................22 4.1 4.2 4.3 Stakeholder Meeting No. 1........................................................................................... 22 Stakeholder Meeting No. 2........................................................................................... 22 Supplementary Consultation ........................................................................................ 23 4.3.1 Urban Development Institute ............................................................................ 23 4.3.2 The Greater Halifax Partnership ........................................................................ 24 4.3.3 Halifax Regional Municipality............................................................................ 24 5.0 Post-Stakeholder Analysis ....................................................................................................25 5.1 Rate Calculation Assumptions....................................................................................... 25 5.1.1 Growth Related Infrastructure Cost................................................................... 25 5.1.2 Impact of I/I Reduction Program ....................................................................... 25 5.1.3 Federal/Provincial Regulations on CSO Management ........................................ 26
December 2012
Revision: 2013-Jan-02
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Regional Development Charge Policy Review Interim Report

5.1.4 Impact of Actual Growth Patterns ..................................................................... 26 5.1.5 Federal/Provincial Infrastructure Funding ......................................................... 26 5.1.6 Declining Consumption ..................................................................................... 26 5.2 5.3 5.4 Economic Impact.......................................................................................................... 26 Considerations to Mitigate RDC Impact ........................................................................ 27 Implementation Alternatives ........................................................................................ 28 5.4.1 Full Value RDC................................................................................................... 28 5.4.2 Revised Charge Allocation Method.................................................................... 28 5.4.3 Phased Implementation .................................................................................... 29 5.4.4 Rate Based Implementation .............................................................................. 29 5.4.5 New RDC Framework at Current Rates .............................................................. 29 5.4.6 Status Quo with Current Charges ...................................................................... 29 5.4.7 Financial Impacts .............................................................................................. 30 5.5 6.0 7.0 Preferred Alternative.................................................................................................... 31 Stakeholder Meeting No. 3...................................................................................................33 Continued Stakeholder Engagement and RDC Finalization.....................................................34
December 2012
List of Tables and Figures

Table 1 Principles of Utility Rate Design for HRWC .........................................................................10 Table 2 Rating Scale for Scoring Charges ........................................................................................14 Table 3 Summary Evaluation of Charge Options .............................................................................14 Table 4 Comparison of RDC Collection Timing ................................................................................18 Table 5 Summary of Projected Charge by Planning Horizon (per Person & per Unit) ........................21 Table 6 Proposed Wastewater RDC Rates.......................................................................................32 Table 7 Proposed Water RDC Rates................................................................................................32 Figure 1 - Schematic of RDC Update Process .....................................................................................19
List of Appendices
Appendix A Stakeholder Consultation Process Documents A-1 Discussion Paper No. 1 A-2 Presentation for Stakeholder Meeting No. 1 A-3 Stakeholder Meeting No. 1 Notes A-4 Stakeholder Meeting No. 1 Summary A-5 Discussion Paper No. 2 A-6 Presentation for Stakeholder Meeting No. 2 A-7 Stakeholder Meeting No. 2 Notes
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A-8 A-9 A-10 A-11 A-12 Stakeholder Meeting No. 2 Summary Presentation for Stakeholder Meeting No. 3 Stakeholder Meeting No. 3 Notes Stakeholder Meeting No. 3 Summary Draft Rules and Regulations Language
December 2012
Appendix B Unit Costs and On-cost Multiplier Tables B-1 RWWFP Capital Program B-2 RWWFP Cost Tables (RWWFP Appendix E) B-3 IRP Unit Cost Summary
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Regional Development Charge Policy Review Interim Report Glossary

ACWGM ADF AWWA CCC CCME COSS CSO ERA HHSP HRM HRWC HW HWB ICI I/I IRP LOS LIC MUD NSE NSP NSPUA NSUARB O&M PE PPE PPU RDC RWWFP R&Rs SDC SRC SSO SUD SW TH TSC UDI WEF WSER WSP WW WW CCC WWTF Atlantic Canada Wastewater Guidelines Manual Average daily flow American Water Works Association Capital cost contribution Canadian Council of Ministers of the Environment Cost of service study Combined sewer overflow Environmental risk assessment Halifax Harbour Solutions Project Halifax Regional Municipality Halifax Regional Water Commission Halifax Water Halifax Water Board Industrial/commercial/institutional Inflow and infiltration Integrated Resource Plan Levels of service Local improvement charge Multi-unit dwelling Nova Scotia Environment Nova Scotia Power Nova Scotia Public Utilities Act Nova Scotia Utility and Review Board Operations and maintenance Population equivalent Per person equivalent Persons per unit Regional Development Charge Regional Wastewater Functional Plan Rules and Regulations System Development Charge (Water Environment Federation) Sewer Redevelopment Charge Sanitary sewer overflow Single unit dwelling Stormwater Townhouse Trunk Sewer Charge Urban Development Institute Water Environment Federation Wastewater systems effluent regulations Water supply plant Wastewater Wastewater Capital Cost Contribution Wastewater treatment facility
December 2012
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Regional Development Charge Policy Review Interim Report 1.0 Introduction
December 2012
The Halifax Regional Water Commission (HRWC) is undertaking a review of the existing regional charges for water, wastewater and stormwater infrastructure to determine if an improved method of calculation and recovery of growth related capital costs can be identified. Such capital charges do not cover asset renewal costs or costs related to meeting regulatory compliance requirements for existing customers these costs will continue to be recovered from user rates or other revenue sources as may become available (e.g. federal or provincial infrastructure programs). An important component of the regional development charge (RDC) review process is consultation with industry and stakeholders. This report will lay out the background and foundation information used to set the stage for stakeholder consultation, describe the process and information presented to stakeholder groups, review postconsultation analysis, and present the next steps for this process.
2.0
Background
HRWC is governed by the HRWC Act. Although the shares of Halifax Water are deemed to be owned by the Halifax Regional Municipality (HRM), it is an autonomous and self-financed utility regulated by the Nova Scotia Utility and Review Board (NSUARB). The HRWC Board is empowered to make by-laws, rules, regulations and policies consistent with the HRWC Act and the Nova Scotia Public Utilities Act (NSPUA). On August 1, 2007, HRM transferred its wastewater and stormwater operations and assets to HRWC which was already responsible for municipal water services within HRM. This moved oversight for wastewater and stormwater services from Municipal Council to the HRWC Board and regulation by the NSUARB. The cost recovery for wastewater and stormwater services related to growth was based on regulations permitted under the HRM Charter (formerly the Municipal Government Act). For water infrastructure, no cost recovery charges related to growth impacts on regional infrastructure were required. Since the transfer of the wastewater and the stormwater assets to HRWC, all development and growth related cost recovery charges are now subject to NSUARB review and approval. When the wastewater and stormwater systems were transferred, the NSUARB approved the continued use of the regional based development charges that were previously established by HRM. These charges are: Sewer Redevelopment Charge (SRC), Trunk Sewer Charge (TSC), and the Capital Cost Contribution (CCC) Charge for Wastewater Treatment Facilities. The collection of regional charges has historically been used by HRM to develop capacity within regional infrastructure. Essentially, capacity as it exists today is already bought and paid for. The focus of this review of the existing regional charges is for future growth related capital costs and to ensure that HRWC has sufficient funds to implement the necessary regional infrastructure driven by growth.
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The NSUARB ordered HRWC to review the development charges in the Cost of Service Study (COSS) that was completed in November 20091. The report recommended that the Area Specific Capital Cost Contribution (CCC) Charge continue to be used. The Area Specific CCC Charge is site specific and relates to oversizing of area master servicing and not to regional infrastructure. It has been in existence for 15 years and has proven to be beneficial as a mechanism to allow growth within a specific area while being cost neutral to the existing customers of the utility. HRWC is recommending that the Area Specific CCC Charge be retained as is. Therefore, no further discussions will be presented regarding the Area Specific CCC Charge with the exception of any comments and questions raised during the stakeholder consultation process. The 2009 COSS presented the concept of a new charge called the Availability Charge. This proposed charge was discussed at the September 13 -17, 2010 Public Hearing. The NSUARB noted in its Decision2 that a greater level of review and consultation was required before a ruling could be made on the proposed charge. As a result, the NSUARB directed HRWC to carry out a more rigorous analysis of development charges including a review of other jurisdictions practices and a stakeholder consultation component to be filed with the next rate application. Also included in its Decision, the NSUARB issued an Order for HRWC to develop an Integrated Resource Plan (IRP). The IRP is a long term infrastructure plan that outlines the capital expenditure needs for the water, wastewater and stormwater systems over the next 30 years. The IRP Final Report3 has been completed and submitted for review to the NSUARB. The IRP has been an important tool for identifying the growth related costs and the projection of the proposed Regional Development Charge (RDC). Another key supporting study for the completion of the RDC analysis has been the Regional Wastewater Functional Plan (RWWFP)4. The RWWFP provided the growth related regional wastewater infrastructure projects and costs that were inputs to both the IRP and subsequent RDC projects. Regional infrastructure is the focus of a revised unified regional charge that is proposed to replace the existing charges.
December 2012
2 3
4
HRWC Cost of Service Study, November 2009 G. A. Isenor Consulting Limited in association with W.H. Gates Utility Consultants Limited and R. M. Loudon Limited NSUARBWHRWCR10, Halifax Regional Water Commission (Re), 2010 NSUARB 244 (CanLII), http://canlii.ca/t/2dzgf, 2010-12-17 Halifax Water Integrated Resource Plan, October 29, 2012, Genivar, Halcrow & XCG Consultants Ltd. Halifax Water Regional Wastewater Functional Plan Final Report, November 22, 2012, CBCL Limited & AECOM
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Regional Development Charge Policy Review Interim Report 3.0 Discussion Papers
December 2012
In preparation for the consultation process, discussion papers were developed. These papers provided foundational information to the stakeholder community regarding: factors driving infrastructure expenditures, infrastructure requirements to facilitate development, existing regional charges, options for a new, unified charge, principles of rate establishment, scoring method for the charge options, factors influencing charges, calculation of the proposed charge, and recommended collection timing.
3.1 Infrastructure Drivers

The IRP identified three strategic drivers Regulatory Compliance, Asset Renewal, and Growth that influenced the development of the long term capital investment needs for HRWCs water, wastewater, and stormwater infrastructure. Using these drivers as a framework, a series of objectives was developed. Projects and programs were reviewed to allocate the proportion of the benefits to each of the objectives/drivers. The Regulatory Compliance driver covered projects and programs needed to address both current compliance issues (i.e. facilities for which HRWC is not compliant with current permits to operate or legislation) and future compliance issues (i.e. requirements resulting from imminent or emerging legislation). The Asset Renewal driver covered projects and programs aimed at a sustainable approach to asset renewal and replacement. Asset Renewal requirements recognize the historical underfunding in some asset classes and evaluates the risk of continuing at the same level of reinvestment in the future. The Growth driver covered projects and programs aimed at providing regional level infrastructure to support growth and in managing flow allocations to optimize system capacity. For the purposes of the RDC Policy development, projects attributable to the Growth driver under IRP Objective 13 (Provide regional water, wastewater, and stormwater infrastructure needed to support growth.) would be used to form the development charge rate calculation. Regulatory Compliance and Asset Renewal projects would be funded by utility customers through the rates and charges or through any available funding programs provided by the Federal or Provincial governments.
3.2 Infrastructure Requirements to Facilitate Development

The RDC process is focused only on the review and revision of HRWCs growth related charges. Within the context of growth related infrastructure, HRWC defines three categories of infrastructure:
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Local Infrastructure that is required to directly service (on-site or off-site) developing properties. Area Master Oversized or enabling infrastructure that is required to directly support the designated master planning areas and the specific development (both inside and outside the master plan area) and that is not considered Regional in nature. Regional Infrastructure that is required to provide core treatment, water transmission, trunk sewer collection services and their associated appurtenances. This infrastructure provides benefit to the larger serviced community and extends across master plan areas.
December 2012
Local and area master infrastructure are the direct responsibility of the developers. Local infrastructure can be installed directly by the developer to service new development or be facilitated by HRM through a Local Improvement Charge (LIC) Process to provide services to existing buildings. Regardless, under either scenario, Local infrastructure is paid for by the benefitting property owner. Area master infrastructure may be facilitated by HRWC and may be eligible for consideration through the HRWC CCC Charge policy. Regional infrastructure, due to its scale and long term perspective, will be programmed, funded, and managed by HRWC to accommodate cumulative growth. Growth funding is intended to be cost recovered through the proposed regional development charges. The RDC policy addresses the recovery of costs to fund regional infrastructure resulting from growth in the service area.
3.3 Existing Regional Charges

There are no existing development charges for water or stormwater infrastructure. There are three existing wastewater related development charges. A comparison of the existing charges is presented in Exhibit 4-1 of Discussion Paper No. 15 (refer to Appendix A). The existing wastewater charges are: Sewer Redevelopment Charge (SRC) currently applies to new buildings that connect to central wastewater services. Historically, the SRC applies to new buildings and building additions in serviced areas. It applies to accessory buildings where the use results in an effluent discharge to the public sewer system. The SRC does not apply to buildings or building additions that were subject to a previous infrastructure charge for the purposes of new or expanded wastewater facilities or stormwater systems. Trunk Sewer Charge (TSC) outlined historically in HRMs By-law S-100, the TSC applies to unserviced lots occupied by a building prior to the enactment of By-law S-100 at the time that lot is serviced.
HRWC Regional Development Charge Discussion Paper No. 1, October 15, 2012, HRWC in association with G.A. Isenor Consulting Limited, Blaine S. Rooney Consulting Limited, and R. M. Loudon Limited
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Capital Cost Contribution (CCC) Charge for Wastewater Treatment Facilities was introduced by HRM. This charge applies to all residential buildings (single-family and multi-unit dwellings) that will be connected to municipal wastewater facilities and all other non-residential buildings in the serviced areas. Un-serviced lots occupied by a building prior to the enactment of By-law C-600, are subject to the CCC Charge for WWTFs when the building is connected to wastewater facilities. The charge also applies to accessory residential buildings where there are effluent discharges to the municipal sewer system and this charge will occur at the time the connection is made.
December 2012
Following the transfer of the wastewater and stormwater systems to HRWC in 2007, the NSUARB issued an Order6 approving a Schedule of Rates and Charges for the Supply of Wastewater and Stormwater Services, incorporating the above-noted regional charges.
3.4 Options and Considerations for the New Charge

Three options were considered in the review. These included: a) continuing with the existing development charges; b) adopt the proposed Availability Charge as proposed in the 2009 Cost of Service Study; or c) develop a new charge structured around infrastructure type (water, wastewater, and stormwater). In order to evaluate the effectiveness of each option, the team looked to the principles for rate setting as guidance. In its March 3, 2008 ruling, the NSUARB reminded HRWC that the utility rate design including development related charges, should adhere to the greatest extent possible, to the principles presented by Bonbright et al7. Through the November 2009 COSS, HRWC reviewed the Bonbright principles and revised the wording for clarity and to reflect relevance and application to HRWC. These revised principles are presented in Table 1. Table 1 Principles of Utility Rate Design for HRWC 1 Revenue adequacy Effectively yield the revenue requirements in a fair and reasonable manner from the customers of HRWC without undue capital spending while meeting service and quality objectives. Provide revenue stability and predictability for HRWC with minimum of unexpected changes. Provide stable and predictable rates with a minimum of unexpected changes that have an adverse effect on HRWCs customers. Establish rate structures that discourage the wasteful use of the service provided while promoting all justified uses and amounts. Set rates that fairly reflect the benefits from the service provided.
2 3 4 5
Revenue stability Rate continuity Cost-based rates Fairness vs. benefits
6 7
NSUARB rulings NSUARB-WW-HRWC-R-07 and R-08 dated March 3, 2008 Principles of Public Utility Rates, James C. Bonbright, Albert L. Danielson, David R. Kamerschen, 2nd ed. March 1988 (p. 383 384)
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6 Defendable vs. costs Set rates that are fair and equitable and that apportion costs of service among the different customer classes that are not arbitrary and capricious.
December 2012
7 8 9
Fairness by class Adaptable to changing circumstances Simple and acceptable
Set rate structures that avoid discrimination in rate relationships and that avoid inter-customer burdens. Set rate structures that are dynamic and promote innovation and that respond to changing demand and supply patterns. Set rate structures that are simple to use and understand, convenient, understandable, economic to implement and maintain, and, are publicly acceptable while meeting the requirements of the NS Public Utilities Act. Set rate structures and rules and regulations that are unambiguous and easy to interrupt. Establish rate structures that promote conservation while ensuring rates that are adequate to meet changing regulatory requirements.
10 Understandable 11 Conservation
In addition to the rate making principles, the team looked to other examples in industry for guidance. The American Water Works Association (AWWA) and the Water Environment Federation (WEF) are two leading organizations that provide guidance on industry best practices for development charges in North America. The AWWA in its Manual M18 (page 198), outlines objectives for establishing development charges including that the charge generally should: Require new development to pay for itself, Fund major system expansion, Generate sufficient cash to fund a portion of capital improvements, Minimize debt, Recover capital costs equitably from current and future customers, and Maintain an appropriate level of retained earnings and cash reserves to meet other capital needs of the system.
AWWA offers support for both an equity based charge and an incremental cost charge. In the equity based charge, AWWA (Manual M1 Fifth Edition, page 199) suggests that: The equity method is based on the principle of achieving capital equity between new and existing customers. Sometimes referred to as the system buy-in method, this approach attempts to assess new customers a fee to approximate the equity or debt-free investment position of current customers. The financial goal is to achieve a level of equity from new customers by collecting an SDC (System Development Charge) representative of the average equity attributable to existing customers.
Principles of Water Rates, Fees, and Charges - AWWA Manual M1 5th edition
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AWWAs equity based charge is synonymous with HRWCs previously proposed Availability Charge. The proposed Availability Charge was based on achieving an equity position between new and existing customers of the system. The method assumed that the existing customers have equity in the existing system and that built-up equity should accrue to the benefit of the existing customers. It is recognized that this approach is most appropriate where the current facilities adequately serve existing and expected future customers, where there are no new significant system investments anticipated, and where the existing facilities are not scheduled for replacement in the near future. With the incremental cost method, AWWA (Manual M1 Fifth Edition, page 201) indicates that: The incremental cost method is based on the concept of new development paying for the incremental cost of system capacity needed to serve new development. This approach proposes to mitigate the cost impact of new growth on existing customers user rates. The goal is to charge a fee for new customers sufficient to allow customer user rates to be revenue-neutral with respect to growth of the system. However, in systems undergoing rapid and expensive growth, this may be difficult to achieve. The incremental cost method is more consistent with the basic cost-causer principle embraced by the NSUARB. This method provided a direct relationship between the need for system expansion and the origin of that need and therefore the causer of the expenditure. The WEF, in its Manual of Practice No. 279 (page 87), suggests there are several principles a utility needs to satisfy when developing a system development charge. The WEF principles suggest: Charge should be proportionate to the proposed impact, Charge is used to provide infrastructure serving the growth area (which may be the entire service area), Charge methodology is uniform and consistent, Other sources of funding are considered for capital improvements, and Charge includes only eligible growth related costs.
December 2012
WEF supports a similar charge to AWWAs concept of an incremental charge. WEF (Manual of Practice No. 27, page 62) suggests: In many growing communities, the unit cost of expanding the wastewater system can exceed the historical or embedded cost of system assets constructed or acquired for existing ratepayers. This may be especially true in older established communities that experience sudden or rapid growth. To equitably assign this increased cost to future ratepayers, i.e. those causing the need to expand the system, many wastewater utilities have implemented System Development Charges (SDCs). System development charges, also known as plant investment fees, impact fees, tap fees, etc., are one-time payments typically collected from a builder or developer at the time a building permit or certificate of occupancy is issued, for new or expanded connections or service. For this reason, SDCs are considered an external funding source, i.e., monies come from outside the entity, from nonrated payers.
9
Water Environment Federation - Financing and Charges for Wastewater Systems WEF Manual of Practice No. 27
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December 2012
When financed using SDCs, capital improvements associated with the expansion of the system are paid for by new customers as they connect to the system and pay the SDC. As such, these expansion or growth-related capital improvements are excluded from the calculation of user charges paid by all customers. In a growing community, SDCs can represent a very significant capital funding source, while at the same time addressing the objective of having growth pay for growth. Because SDC revenues are based exclusively on the amount or rate of new development, this revenue source can, on a year-to-year basis, be subject to a high degree of uncertainty and fluctuation. Furthermore, the utility may not have the luxury of waiting until a significant amount of SDC revenue has been accumulated to construct the needed facilities, e.g., a wastewater treatment plant expansion. As such, it may be necessary to use other forms of financing (e.g., long-term debt) to fund the facilities and rely on SDC revenues to repay the debt in part or in total. WEFs concept for a system development charge again is consistent with the NSUARBs cost-causer principle. HRWC also sought out development charge policy examples from elsewhere in Canada. British Columbia, Alberta, Saskatchewan, Ontario, New Brunswick, and Nova Scotia were part of a survey of how development charges are handled across Canada. Enabling legislation for the recovery of local infrastructure capital costs from those benefitting exists in all of the provinces surveyed. It is universally accepted that growth should pay the cost of local infrastructure. Legislation regarding the recovery of major facilities capital costs from growth varied widely from province to province. Of those provinces surveyed, British Columbia, Alberta, Saskatchewan, Ontario and Nova Scotia all allow capital cost charges for major facilities. New Brunswick does not. Ontario has the most fully developed legislation regarding growth related capital costs. Ontario has a long history regarding development charges and has a specific Development Charge Act the only provincial legislation dedicated to charges expressly designed to recover capital costs for major facilities. To implement a development charge in Ontario, a municipality must first complete a development charge report which quantifies eligible growth-related capital costs and the amount of forecast growth upon which these costs are predicated. The development charge report must be updated periodically. All provinces surveyed appear to allow the cost of new or expanded works to be included in the development charge. Some provinces appear to limit the charge to new investments. Alberta states An off-site levy may be used to pay for all or part of the capital cost of new or expanded water supply, sanitary sewage, and storm sewer drainage facilities. Ontarios legislation also states that municipalities may impose charges against land to pay for increased capital costs required because of increased needs for services arising from development of the area to which the by-law applies. The British Columbia wording appears slightly less restrictive This charge is used to help pay the capital costs of providing, constructing, altering or expanding sewage, water. Saskatchewan appears less restrictive stating the capital cost of providing, altering, expanding or upgrading sewage, water, drainage.... Thus for some, only new works are permitted in the charge, while for others it appears that the cost of existing works with capacity to accommodate growth can also be recovered.
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Based on the provincial review, only New Brunswick does not have legislation authorizing development charges to recover the cost of off-site infrastructure necessary to service growth. In all jurisdictions, funds generated through development charges must be sequestered in separate reserves to be used only for the intended purpose.
December 2012
3.5 Evaluation of Options

Each of the charge options was assessed using the principles identified in Table 1. Using a rating scale from 1 to 5 with a score of 1 indicating the option does not meet the principle and a score of 5 indicating the option fully meets the principle, the charge options were scored. Table 2 provides the full rating scale and description of the scores. Table 2 Rating Scale for Scoring Charges Score 1 2 3 4 5 Description Indicates the option does not meet the principle. Indicates the option meets some of the elements of the principle. Indicates the option meets approximately half of the elements of the principle. Indicates the option meets most of the elements of the principle. Indicates the option fully meets the principle.
Table 3 provides a summary of the scores for each charge option. Specific details of the scoring including brief narratives regarding each charge, the score assigned, and the supporting comments are available in Discussion Paper No. 1 (refer to pages 13 and 14). Table 3 Summary Evaluation of Charge Options Principle 1 2 3 4 5 6 7 8 9 Revenue adequacy Revenue stability Rate continuity Cost-based rates Fairness vs. benefits Defendable vs. costs Fairness by class Adaptable to changing circumstances Simple and acceptable Existing Charges 2 4 5 1 1 1 3 2 2 Availability Charge 2 4 3 2 3 2 4 5 3 New RDC 4 4 4 5 5 5 5 5 3
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10 11 Understandable Conservation TOTAL SCORE 41 1 26 51 1 34 4 1 45
December 2012
1. Based on feedback and further review, the scores for the both the Existing Charges and the Availability Charge for principle 10 understandable, are more appropriately at a level 3; however, the one point change will have no bearing on the overall scoring.
3.5.1 Status Quo Retain Existing Charges The existing charges were inherited from HRM at the merger. The derivation of these charges was done by HRM staff and there is no mechanism for adapting the rate to changing circumstances. The existing charges are attributable to wastewater infrastructure only. The existing charges do not adequately fund the cost of growth related infrastructure. The gap between the funds generated by the existing development charges and the projected 30 year growth needs increases significantly with the IRP. However, retaining the existing charges does provide continuity an approach consistent with principle #3 on rate continuity (refer to Table 1 Principles of Utility Rate Design for HRWC). Retaining the existing charges would require a complete review of the cost recovery calculation and an adjustment to meet the revised cost requirements in order for the charges to be fair, defendable, adequate, sustainable, and effective. 3.5.2 Availability Charge The Availability Charge option was not supported by the NSUARB as presented in the 2009 COSS. At the time the Availability Charge was proposed, HRWC was not in a solid position to confirm the capacity of the wastewater system. Significant effort was needed to put HRWC in a position to quantify the current capacity including appropriate allowances for wet weather flows. As well, without the baseline understanding of the wastewater system, it was difficult to predict the impacts of additional growth on the system. The situation was further complicated as a result of the emerging federal regulations for wastewater compliance being formulated by the Canadian Council of Ministers of the Environment (CCME). The uncertainty around the resulting regulations had implications on HRWCs approach to managing overflows initially this was specific to combined sewer overflows (CSOs). Early indications were that the regulations would prohibit an increase in volume and frequency of CSOs as a result of growth unless there was an approved overflow management plan in place. To assist HRWC in better understanding the constraints on the wastewater system, HRWC commissioned the completion of the RWWFP. When the Water System Effluent Regulations (WSER)10were issued, they were silent to the management of CSOs, however, subsequent consultation with Nova Scotia Environment (NSE) indicated that HRWC was correct in making the assumption about CSO management. NSE expects to pursue CSO management at some point within the 30 year planning horizon. Finally, the Availability Charge as proposed did not capture costs associated with providing future capacity nor is it sufficient to meet the long term growth infrastructure needs of the utility.
10
Wastewater Systems Effluent Regulations, Canada Gazette, Vol. 146 No. 15, June 2012
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3.5.3 Proposed RDC Building on the AWWA and the WEF concept for the Incremental Cost Method and the System Development Charge, respectively, HRWC is proposing an RDC based on using a long-term projection of the capital investment required to service the planned growth in the service area. With the completion of the IRP, HRWC now has the long-term capital plan covering the three drivers: regulatory compliance; asset renewal; and growth. The growth portion of the IRP capital plan provides the financial basis for calculating the RDC. The growth related expenditures outlined in the IRP represent the costs associated with only the regional level infrastructure needed to support the growth projected by HRM. The Debt Study that will be filed with the NSUARB provides comprehensive financing options to support delivery of the IRP. The options presented include scenarios with growth related charges in the existing form, and scenarios with an enhanced RDC. Regardless of the final form, the financial models identify that an enhanced RDC to support growth related costs is important to enable IRP delivery within the constraints of maintaining affordable rates, and reasonable debt service ratios. Water, wastewater, and stormwater infrastructure must be built in advance of new customers occupying premises. Local and area master infrastructure costs are funded directly by the development community. Although Regional level infrastructure costs could be recovered from the user rates subject to NSUARB approval, it is common municipal practice in Canada to recover the costs such that future development does not burden the existing customer base. This is usually achieved either through construction by sub-dividers with the costs being transferred to the end user or new property owner or through construction by the utility or municipality with cost recovery by some form of levy from the new development. The proposed RDC is consistent with development charge practices of other Canadian Municipalities as well as the principles presented by AWWA and WEF. The RDC is cost based and therefore follows NSUARBs cost-causation principle. It is based on a 30 year growth and associated regional infrastructure projection as outlined in the RWWFP and IRP. And the method of calculation is understandable and can be applied to water, wastewater, and stormwater infrastructure as appropriate.
December 2012
3.6 Factors Influencing Charges

HRWC reviewed basic principles to guide the mechanics of implementing a new RDC. These rules lay out what the proposed RDC will cover, how it will be calculated, how it will be collected, where it will apply, how often it will be reviewed and updated, and what the new charge will replace. The mechanics of the new RDC are: 1. The RDC is intended to recover costs related to regional level infrastructure constructed by HRWC to support growth based on HRMs growth projections. 2. The RDC will replace the existing Sewer Redevelopment Charge, the Trunk Sewer Charge and the Charge for Wastewater Treatment Facilities. 3. RDCs will apply to regional water, wastewater and stormwater infrastructure. 4. RDCs will be supported by analysis and a report with financial plans and customer growth projections.
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5. The RDC will apply to development on land not previously developed or for redevelopment of existing property to a higher service level. 6. RDCs will apply to Master Plan Areas where an Area Master CCC Charge has been levied. 7. Eligible costs (net of applicable grants and subsidies) include capital costs as well as any administrative costs related to the RDC program such as the cost of preparing RDC reports and infrastructure studies. 8. RDCs will be calculated based on the average future cost of providing regional facilities for growth across the HRWC service area over the planning horizon. 9. The RDCs will be calculated based on the projected future capital programs and costs for previously financed works will not be included. 10. Costs will be developed and charged on a per person basis (based on highest and best use of the property. 11. Costs and customer parameters will be based on annual projections. 12. The RDCs will be recalculated and updated every 5 years. 13. RDCs for large users will be calculated based on projected flows by use and converted to a per person equivalent. 14. All RDC receipts will be deposited to a Regional Development Charge Reserve Fund with separate accounts for water, wastewater and stormwater. 15. The RDC calculation should result in a zero reserve fund balance at the end of the planning horizon. 16. HRWC, in response to HRMs regional planning process, will be responsible for long term master planning and implementing regional level growth projects. 3.6.1 Influencing Factors Several factors will continue to influence or inform the RDC including changing regulations, HRMs Regional Plan update process, HRWC master planning (including updates to the IRP and the long term capital plan), timing of RDC reviews and updates, and public consultation. Changes to regulations in relation the Federal Fisheries Act or NSEs requirement for system management may affect how growth impacts existing infrastructure. Further, emerging regulation is expected to require HRWC to control CSOs as a minimum such that there is no increase in frequency and volume of CSOs in the wastewater system. These influences will be factored into the calculation of the RDC. HRWC, in response to HRMs regional planning process, will be responsible for long term master planning and implementing regional level infrastructure projects. HRM undertook its first Regional Plan
December 2012
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in 2006 with the intention that it would be updated on a regular 5-year cycle. The Regional Plan is currently being updated through HRMs RP + 5 process. On a go forward basis, HRWC will use updated growth projections and land use plans from HRM to develop updates to master plans for water, wastewater, and stormwater infrastructure. These master plans, together with plans done to address other business drivers (i.e. regulatory compliance and asset renewal), will be used to update HRWCs IRP. The IRP updates will result in the development of a revised long term capital plan that further informs the calculation of the RDC. Regular updates of the proposed RDC to ensure it is adequately funding the required long term capital plan while not over collecting from the development community will be required. HRWC plans to update the RDC every 5 years to coincide with the updates to HRMs Regional Plan, HRWCs master planning efforts, and updates to the IRP. Public consultation will be an integral part of the RDC updating process. HRWC is committed to presenting the elements of the RDC to the stakeholder community. For this initial RDC development, two public consultation sessions were initially anticipated with stakeholders to discuss the options available and to seek input on the structure of the future development charge format. For ongoing RDC updates, consultation will be embedded in the overall process. 3.6.2 Options for Regional Development Charge Collection Three options are under consideration for the timing of RDC collection: at the subdivision stage, at building permit stage, or at the time of meter connection. Table 4 provides a comparison of the various approaches under consideration for RDC collection. Table 4 Comparison of RDC Collection Timing RDC Collected at: Subdivision Advantages Captures largest proportion of charges Disadvantages Process is controlled by HRM, therefore there is a lack of internal control with the collection May not capture intensification infill projects Building Permit Suitable for collecting on site plan and infill developments Greatest point of control for HRWC Process is controlled by HRM, therefore there is a lack of internal control with the collection Very late in the development process If it is a redevelopment site, the meter may not change and therefore not trigger collection of the fee The subdivision and building permit processes are controlled by HRM while HRWC has control of the meter connection process. Charges collected at the subdivision stage may capture the greatest area of land development upon registration of the subdivision. However, this point in the development process may not capture all redevelopment scenarios (for example, infill and intensification projects that may
December 2012
Meter Connection
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not be subject to subdivision requirements). Waiting to collect at the meter connection point of the process, may not capture redevelopment applications where no change in the meter size is required (therefore, there would be no trigger for the charge collection). Collecting at the building permit stage covers the greatest percentage of development applications including subdivision, site plans, infill developments, redevelopments (intensifications). For HRWC, the building permit stage is the most appropriate timing for collection of the charge. Administratively, HRWC will need to continue to coordinate the charge collection with HRM as HRM staff are the first point of contact at the building permit stage.
December 2012
3.7 Calculation of the Proposed Charge

The proposed RDC will be calculated based on the 30 year growth related costs identified in the IRP. Essentially, the total cost projected over the planning horizon for the regional infrastructure will be divided by the population growth for the period resulting in a cost per person rate for residential development. For non-residential development, HRWC is considering a population equivalent flow based method. The RDC calculation will be updated on a 5 year cycle with a rolling end horizon coincident with HRM regional planning updates, HRWC master planning and IRP updates (see Figure 1).
Growth Projections (From HRM)
30 Year Capital Plan (Regional Infrastructure)
Update RDC
Updated on a 5 year cycle

Figure 1 - Schematic of RDC Update Process 3.7.1 Estimated Growth The growth projections were provided by HRM Planning and have been identified in 5 year increments. For the purpose of the RDC calculation, the growth over each 5 year period for both residential development and non-residential development Industrial/Commercial/Institutional (ICI) has been spread evenly over the 5 year period. HRWC has converted the ICI sources to equivalent flows and then converted those flows to a per person basis or population equivalent.
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The residential growth over the next 30 years is projected at 137,900 and population equivalent for ICI lands is 63,300 for a total of 201,200 persons. The population projections are outlined in the appendices of Discussion Paper No. 211. 3.7.2 Projected Infrastructure Costs The RWWFP, in conjunction with the IRP, developed the infrastructure plan for the 30 year growth requirements. The infrastructure plan is comprised of a number of transmission and trunk mains, pump stations, and treatment facility upgrades across multiple water and sewer sheds to provide the recommended regional servicing solution. Through the studies and evaluation of infrastructure needs, HRWC determined that there are no regional growth related stormwater infrastructure components. The annual infrastructure costs are presented in Discussion Paper No. 2 (refer Appendix A-5). 3.7.3 Calculation Details Through the RDC analysis, a financial model was developed to arrive at a projected charge that would have a zero balance at the end of the 30 year planning horizon. The model assumes HRWC will earn 1% on invested funds when the fund is in a surplus position, and it assumes HRWC will pay 6% in interest costs on short term loans when the account is in a deficit position. It is recognized that actual capital spending and development will differ from that assumed in the model. However, the proposed periodic RDC updates will factor in these differences. The proposed RDC calculation is:
December 2012
RDC (max) =
Total Regional Infrastructure Costs (over 30 years) Total Projected Growth (population equivalents)
Total Regional Infrastructure Costs include the projected construction costs plus financing over the 30 year horizon. The total projected growth includes both residential and non-residential growth. Projected charges were calculated for three development charge horizons: 30 year, 20 year, and 10 year. These costs include the annual wastewater and water infrastructure costs for projects required within each of the horizons, projected revenue, and net financing costs. Full details of the cost tables are presented in Discussion Paper No. 2 (refer to Appendix A-5). To present the rates in terms of unit cost (i.e. a cost per unit of development), the per person rates must be multiplied by the average household density factor. Consistent with the method used in the RWWFP flow analysis, the average population density was assumed to be 2.4 persons per household. HRWC has prepared the following table based on this average assumed density. It is proposed that the final calculation for varying land uses will be determined as noted in Section 5.4.2.
11
HRWC Regional Development Charge Discussion Paper No. 2, November 15, 2012, HRWC in association with G.A. Isenor has pr
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Table 5 Summary of Projected Charge by Planning Horizon (per Person & per Unit) Charge Type Wastewater Water 1 TOTAL 30 Year Rate per Person $3,019 $133 $3,152 per Unit $7,246 $319 $7,565 20 Year Rate per Person $3,762 $148 $3,910 per Unit $9,029 $355 $9,384 10 Year Rate per Person $3,983 $195 $4,178 per Unit $9,559 $468 $10,027
December 2012
1. The capital costs for water require adjustment for declining consumption.
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Regional Development Charge Policy Review Interim Report 4.0 Stakeholder Consultation
December 2012
Initially, two formal stakeholder sessions were held for the RDC policy process. Both sessions were well attended by industry and resulted in informed discussion. Attendees ranged from members of the Urban Development Institute, Halifax Regional Municipality staff, Investment Property Owners Association of Nova Scotia (IPOANS), Nova Scotia Homebuilders Association, Heritage Gas, Nova Scotia Environment, Dalhousie University, general members of the development community, and the project team including consultant partners. Subsequent to the outcome of the first two meetings, a third meeting was held on December 18, 2012 and is documented in Section 6.
4.1 Stakeholder Meeting No. 1

Stakeholder Meeting No. 1 was held November 1, 2012 and presented the background and principles of the RDC concept consistent with the information provided in Discussion Paper No. 1 (refer to Appendix A-1). In general, the meeting laid out why HRWC was reviewing its development charges, what drivers are influencing capital planning decisions, how existing development charges are used, options for a new development charge, principles affecting the establishment of a charge, industry practices for development charges, rules around the mechanics of how the charge would work, timing for RDC collection, and a recommendation for the proposed charge. Stakeholder Meeting No. 1 was reasonably well attended and elicited good discussion on the preliminary RDC analysis. Major points of discussion included: Whether the RDC would replace the existing charges or be an additional charge. How HRWC intends to apply the charge (single, postage stamp approach across whole service area or tiered approach representative of where servicing costs are physically located). Financial matters around borrowing to fund infrastructure and limits on the borrowing horizon. Methods for ensuring coordination with HRMs ongoing regional planning process. The point in the development process where the RDC would be collected. The concept of RDCs applying to developments on top of area CCCs. Method for allocating costs where a project covers both asset renewal and growth drivers. The appropriate time for stakeholders to make comments.
4.2 Stakeholder Meeting No. 2

Stakeholder Meeting No. 2 was held November 15, 2012 and HRWC presented the calculation methodology for the RDC and the preliminary calculation results based on the population projections provided by Halifax Regional Municipality (HRM) and infrastructure information from the IRP. In general, the material presented included a brief overview from Stakeholder Meeting No. 1, a discussion of the proposed calculation, then an open discussion session with the group. HRWCs proposed RDC preliminary rate calculation is based simply on the population growth projections and growth related infrastructure costs contained within the IRP. The resultant initial calculation for the RDC charge rate is approximately $7,500 per unit. Major points raised included: Approval process for the new charge (does the NSUARB need to approve it?). The origin of the growth related infrastructure costs. Availability of federal funding programs.
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The ability to share development costs between upfront charges and across the whole user rate base. Economic impacts of such a large increase in the upfront charge. Balance of inter-generational equity and pure cost-causation. Conservation and declining consumption. Equity around unit sizes (same proposed charge for a 5,000 square foot home as bachelor apartment).
December 2012
HRWC invited participants to submit written comments or to request a meeting of smaller groups as needed. The Stakeholder Meeting notes (high-level) and meeting summary (question/concern and response) are provided in Appendix A.
4.3 Supplementary Consultation

In addition to the formal stakeholder meetings, HRWC met with smaller groups or individuals to discuss the proposed charges, issues and concerns, and potential impacts to its implementation. Groups that were part of this process included the Urban Development Institute, the Greater Halifax Partnership, and Halifax Regional Municipality. Key points raised by these groups are outlined in the following sections. 4.3.1 Urban Development Institute A meeting was held on November 28, 2012 with representatives of UDI. The group reiterated their concern on the overall economic impact of the increased RDC and its application at the Building Permit stage. They suggested and promoted that the required funding for capacity increases in regional water and wastewater infrastructure be funded through an increase to the core water and wastewater rates. The specific concerns raised by the UDI representatives included: The overall dollar amount identified in the IRP attributable to growth seems high and UDI would like to understand how the number was derived. UDI would like to understand the overall growth numbers and locations where growth is projected to occur. UDI members would like to see a higher level of demand management and conservation estimates considered in the calculations. Imposing an upfront charge as proposed with the RDC will have a detrimental impact not only on the development industry but also on HRWCs ability to help fund future asset renewal and compliance related infrastructure needs. The new RDC will stall housing starts and therefore, indirectly impact HRWC by reducing the available rate base that would be the source of rate based infrastructure projects. Using the five year update periods results in offsetting costs based on changing assumptions and therefore variability and unpredictability in the charges. UDI would support a full rate based development charge that is shared by all users.
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4.3.2 The Greater Halifax Partnership HRWC staff met with Fred Morley, Executive VP and Chief Economist with the Greater Halifax Partnership on November 27, 2012 to discuss the validity of several economic assumptions that have been utilized within the IRP and the 30 Year Financial Model. As well, the discussions covered the issue of the economic impact of an increased RDC type charge. The general comments and observations from Fred Morley are summarized as follows, and generally support some of the concerns raised by stakeholders. A large development fee could indeed stop some types of development cold or shift it to other municipalities. This upfront type of charge will create a threshold or barrier to large scale development. It would directly encourage less dense development, which runs counter to the main density objectives of the regional plan (densification within the city centre). The charge as initially proposed is contrary to the current objective of higher density. In addition, a substantial increase in the development charge would increase cost of structures more than by the amount of the charge. At each level of a development, mark ups and margins will increase by percentage terms not by actual amounts. Borrowing will cost more, construction will cost more, units will cost more. Everyone touching a development gets a bigger cut. So a $7,500 fee per unit may be $12,000 per unit when all the extra costs are in. This obviously has a big impact on affordability of multi-unit rentals, condominiums and single family units. The charge could promote a jump in charges encouraging a swing towards super expensive condos in the downtown. However the market for this is probably limited. Layered on top of this may be development charges that HRM is now contemplating.
December 2012
4.3.3 Halifax Regional Municipality HRM has participated in Stakeholder Sessions for both the IRP and the RDC Development. They will continue to review and discuss the implications to both HRWCs financial capacity and the impact of the RDC charges to the development of the growth areas identified within the Regional Plan. HRM has advised that they do not have any current formal comments on the RDC policy and look forward to the opportunity to continue to participate and comment as HRWC finalizes the RDC.
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Regional Development Charge Policy Review Interim Report 5.0 Post-Stakeholder Analysis
December 2012
Based on direct feedback from the stakeholders and review by the internal RDC team, two core issues have evolved that question the practicality and/or appropriateness of the new charge being established at approximately $7,500 per unit relative to the existing charges of approximately $1,500 per unit. 1. A different level of detail and rigor are appropriate for short term rate making versus long term planning. The IRP utilized a series of conservative assumptions in developing long term growth related infrastructure requirements and subsequent costs. These conservative assumptions are reasonable in the context of a 30 year planning horizon. However, the assumptions may need to be refined for the establishment of a specific charge rate. 2. The immediate increase to $7,500 per unit may cause a drastic near term economic impact on the building industry, the HRM Regional Plan implementation and the HRM economy in general.
5.1 Rate Calculation Assumptions

A number of conservative assumptions were used in developing the long range capital investment plans through the RWWFP and IRP. While these assumptions are appropriate for a long term master planning level of study, greater refinement may be more appropriate for defining a specific charge. The following section discusses several specific assumptions utilized within the RDC calculation and how these may impact the value of the RDC rate over time. 5.1.1 Growth Related Infrastructure Cost The growth related infrastructure defined within the IRP was generated from the Regional Wastewater Functional Plan (RWWFP). Growth projections for the RWWFP were provided by HRM to a 2046 planning horizon for low, medium (baseline), and high growth scenarios. The baseline growth scenario was applied in the analysis. The RWWFP defined a preferred concept plan based on a multi-criteria analysis of a series of concept plans that met the modeled flow requirements of the 30 year growth projection. The preferred concept was assigned a capital cost based on a high level unit rate calculation with a 1.6 times multiplier for engineering, contingency, interest and overheads. These costs are appropriate for the concept comparison and development of long term order of magnitude costing for planning purposes. 5.1.2 Impact of I/I Reduction Program The IRP developed a series of programs and projects to analyze and reduce the impact of wet weather flows in the wastewater systems. These programs and projects will deliver a range of infrastructure upgrades and enforcement programs that are projected to have the net effect of less stormwater in the wastewater system for the benefit of reduced pumping and treatment costs, reduced environmental and health impacts (improved regulatory compliance) and increased capacity in the network. The current RWWFP is based on the assumption that the net effect of I/I reduction or wet weather flow management will be offset by continued degradation of aging infrastructure resulting in no impact on system capacity. The true impact of the wet weather management approach is difficult to forecast. However, through the implementation of a formal Wet Weather Management Program and an I/I Pilot Program, HRWC should be able to demonstrate predictable and repeatable results within the first five year cycle. Based on this work, I/I gains may prove to be greater than typical asset degradation over time.
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5.1.3 Federal/Provincial Regulations on CSO Management The RWWFP was modeled on the assumption that the CCME Strategy requirement of no increase in CSO volume or frequency due to new development would be a regulatory requirement in the near term. Consistent with input from the consultant team and the NSE, this is an assumption for the 30 year planning horizon. This assumption is coupled with the policy position from HRWC that the cost of infrastructure to achieve this is allocated to the developers. The timing and exact requirements of the pending regulation has not been finalized at this time and thus the development of a specific charge rate contains some level of risk on the appropriate rate level. 5.1.4 Impact of Actual Growth Patterns The IRP growth projection, based on direct input from the HRM Regional Plan process, assumes a 137,900 population growth over 30 years plus 63,300 equivalent population from non-residential industrial/commercial/institutional (ICI) growth. A revised assumption on future growth that may evolve with subsequent reviews of the HRM Regional Plan may significantly alter the required infrastructure plan and the related rate requirements. The growth projections used for the RWWFP and IRP processes were based on the population allocations described in HRMs 2006 Regional Plan. HRM is continuing to review and assess the impacts of changing the population allocations through the current RP+5 process. Consequently, should HRM recommend a population allocation different than the original Regional Plan allocations, adjustments to the servicing plans may be required. These changes can be picked up in the regular master plan and RDC updates. 5.1.5 Federal/Provincial Infrastructure Funding The current HRWC 30 year Financial Model assumes that any available Federal/Provincial infrastructure funds that become available will be allocated towards projects to comply with the WSER or reduce CSO overflows consistent with proposed future regulatory requirements and utility goals. Pending the exact role out of future regulations and utility priorities, some allocation to growth related CSO projects may be considered. 5.1.6 Declining Consumption The infrastructure for the 30 year growth horizon was developed based on the RWWFP with an assumption of 1.5% per annum declining water consumption for the first 15 years. The actual pattern of declining consumption may exceed this amount pending the full impact of economic and conservation driven factors. A total decrease in consumption beyond the base assumption would reduce the size and/or defer the timing of construction for growth related infrastructure.
December 2012
5.2 Economic Impact

The stakeholder input from Stakeholder Meeting No. 2 provided a range of comments from land developers, multi-unit builders and home builders that the establishment of the RDC rate at $7,500 per unit would have a drastic near term economic impact on the building industry and the HRM economy in general. The impact of an extra $6,000 on a single family building permit or an extra $600,000 on a proposed 100 unit building would change the business decisions being made. Stakeholders suggest that this will cause a reduction in building starts, shift development towards Single Family, shift development out of desired densification areas within HRM, and shift development activity to outside of HRM boundaries.
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The stakeholders generally respect the principles of the charge and understand the mechanics. They state that the simple reality is that too large an increase at once may have economic consequences that are inconsistent with the overall Regional Plan growth goals and create a near term impact in the overall economic benefit of the building construction industry on the region. The stakeholders also see the merit in the RDC approach that will ensure long term capacity within the wastewater system for development opportunity, but stress the impact of a reasonable implementation plan as a necessity to retail stability and growth within their industry. These direct stakeholder concerns are echoed by the Greater Halifax Partnership, with the observations from Fred Morley noting the proposed RDC could create a barrier to large scale development and is not aligned with the densification objectives of the HRM Regional Plan. It is important to note that the stakeholder consultation narrowly focused on the economic impact associated with development activity and did not include agencies or representatives such as the Consumer Advocate, Department of Community Services or Health or Dalhousie Legal Aid who may be concerned with broader socio-economic impacts and rate affordability, particularly for residential and low-income customers.
December 2012
5.3 Considerations to Mitigate RDC Impact

The stakeholder input raised several questions on the RDC collection and allocation method. HRWC had initially suggested full payment of the RDC at the Building Permit stage and an equivalent rate per housing unit (single family dwelling or apartment unit). The Stakeholders encouraged HRWC to review the practicality and benefit of several collection/allocation scenarios that may mitigate the impact of the charge implementation for the development community and the local economy in general including: 1. Consider developing a differential rate structure for different housing unit classifications. An allocation of costs apportioned to the theoretical occupancy (and thus water consumption) may more accurately reflect the impact of the type of unit. 2. Payment of all or a portion of the RDC in a series of annual payments by the subsequent home owner through an LIC or Area Rate type charge or a rate based process within the water bill. This would reduce the sticker price of new homes and provide deferral of some of the costs over time. 3. Allocate all or a portion of the proposed charge to the general Utility rate base. This would eliminate any impact of a new charge on building costs and related economic issues. The offsetting concern would be the appropriateness of the increase in the rate base in a cost causation and rate affordability context. In effect, any portion of growth related capital costs not paid for the by the Regional Development Charge will be paid for by the rate base through the utility rates or the growth related capital projects would not proceed. 4. Reduce the scope and cost of the growth related infrastructure through refinement of the assumptions used in the RWWFP and IRP. 5. Adjust the rate annually for the time value of money.
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5.4 Implemen tation Alternatives
The initial approach to the development and implementation of the new RDC was to base the charge on the infrastructure costs and population projections from the IRP, collect the full charge at the Building Permit stage and include at full value within the proposed rates for the 2013 submission. The following alternatives to the full IRP based RDC implemented at the Building Permit stage, are presented and discussed in the following sections, with a brief summary of financial implications of the alternative approaches at the end of the section. 5.4.1 Full Value RDC Base the charge on the infrastructure costs and population projections from the IRP, collect the full charge at the Building Permit stage and include at full value within the proposed rates for the 2013 submission. This approach provides for the full collection of the required infrastructure funding based on the IRP cost and population information and fully collects from the builder at the time of building permit. This approach provides full cost recovery and allocates all costs directly to the builder. As previously discussed, there are significant concerns raised about the economic impact and calculation accuracy of an immediate increase to the full value RDC. 5.4.2 Revised Charge Allocation Method To address some of the concerns raised by the development community the costs were reevaluated to give consideration to unit type. The costs were prorated based on the residential/non-residential equivalent populations. The residential costs were then prorated to reflect people per unit (ppu) 2.4 ppu average, 3.35 ppu for a single unit dwelling (SUD)/townhouse (TH) and 2.25 ppu for a multi-unit dwelling (MUD). Based on HRMs building permit statistics (6 year average) there is a 55% SUD/TH and 45 % MUD split between housing types. With residential applications, the proposed structure will remove payment by the developer for nonhabitable space (i.e. parking garages). With non-residential applications, the proposed structure will allow for collection based on flow generation, thus providing fairness for the type of use (i.e. a warehouses producing less wastewater will pay less than a hotel). In determining the rate structure we have assumed a typical SUD/TH is 185.8 m2 (2000 ft2), a MUD is 111.4 m2 (1200 ft2) and ICI assumes base equivalent to flows from retail/commercial/office (6/L/m2/day). The anticipated flows for each application will be reviewed prior to approval and the base rate will be adjusted to reflect the increase or decrease in flows. Flows are to be provided by the applicants designer, and shall be in keeping with the Atlantic Canada Wastewater Guidelines Manual (ACWGM). The rate structure will apply to all serviced areas. For ICI applications the charge is to reflect the flows as opposed to simply being based on the area. This allocation method could be applicable to all other alternatives.
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5.4.3 Phased Implementation An alternative implementation plan would be a phased approach. The initial rate would be established at a reduced percentage of the full rate calculation (50% for example). This proposed approach would buffer the economic impact of an initial rate increase of approximately 500% and the resulting potential impact on development activity and Regional Plan goals . In addition, this initial rate would allow a full 5 year cycle (or other time frame) to refine the data and cost impact of the series of assumptions related to the infrastructure and charge rate. The charge would be right sized based on the revised assumptions and corresponding cost and population projections, and any change in the charge would involve stakeholder consultation and a public hearing process with the NSUARB. 5.4.4 Rate Based Implementation Rather than impose an upfront RDC, shift all or a portion of the development related costs to the rate structure. This will allow the development costs to be shared across the entire rate base and improve affordability while reducing the potential to stall housing starts. The proposed rate based alternative raises significant concerns relative to the cost causation principle and will require additional consultation with the NSUARB. In addition to raising concerns with respect to cost causation, this raises additional rate affordability concerns. The rate base will be paying for the asset renewal and compliance portions of the Integrated Resource Plan, and even under optimistic scenarios, it is anticipated that annual bills for water, wastewater and stormwater will increase significantly over the next 30 years. It is important to note however, that incomes will also increase during that time period, and HRWC has developed several financing scenarios that indicate delivery of the Integrated Resource Plan is possible within best practices and industry standards for Rate Affordability. 5.4.5 New RDC Framework at Current Rates Establish the framework of RDC based on presented principles and set the initial rate at a level generally equivalent to the existing development type charges (SRC plus CCC charge for wastewater) and continue dialogue and analysis to develop the appropriate charge rate, and collection methods. This alternative provides for the establishment of a single new charge for Wastewater and Water infrastructure that is applicable equitably across all development activity within the region that is clearly collected and utilized for the capacity increase of Regional Infrastructure and collected based on a method closely related to projected water use. Setting the initial rate for the Wastewater RDC similar to the cumulative current development charges would provide an initial buffer to the potential economic concerns raised by the Stakeholders, allow a continued period of time to improve the validity and cost impact of the series of assumptions related to the infrastructure and charge rate, and review potential alternative collection methods as discussed above. No development charges currently exist for Regional Water infrastructure. Thus, the proposed charge is based on the infrastructure cost estimate from the IRP (as per 5.4.1). This proposed Water charge, due to its relatively low rate, may have minimal potential economic impact as compared to the full Wastewater RDC rate. 5.4.6 Status Quo with Current Charges Leave the existing development charges in place. The Status Quo alternative, while addressing some of the economic concerns of the Stakeholders, would leave in place an historical multi-charge system that is not equally applied across various developments (SRC charge is currently not applicable for a HRWC
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Area Master CCC charge area), and does not include a charge for Regional Water Infrastructure. The existing charges do not provide an adequate funding stream for the projected regional infrastructure needs. However, this alternative would also allow a continued period of time to improve the validity and cost impact of the series of assumptions related to the infrastructure and charge rate, and review potential alternative collection methods as discussed above. 5.4.7 Financial Impacts Mark Gilbert, PhD has prepared a Debt Study entitled Study of an efficient funding mechanism for Halifax Regional Water Commission which will be filed on January 9, 2013 with the NSUARB. The terms of reference for the study were approved by the NSUARB, and the study focuses on best practice review, information from other jurisdictions, and concludes with a recommendation for an efficient funding mechanism that is fair to present and future ratepayers. The context for the recommendation is one that applies to a local government enterprise providing water, wastewater, and stormwater services in Nova Scotia. The review of best practice covers eight information sources ranging from professional association manuals, practices, and publications to rating agency methodologies and reports. The information relevant to capital structure and debt limits for water / wastewater utilities and local governments is summarized in the report. The best practice review suggests a municipally owned water, wastewater and stormwater utility providing service in its home municipality should select a capital structure and debt limits that reflect a focus on enhancing rate affordability and stability. These enhancements are subject to the factors and constraints, which include senior government legislation and regulation that influence and restrict the municipalitys debt policy. Using the final Integrated Resource Plan as approved by the HRWC Board on September 28, 2012, several combinations of financing alternatives were examined using a robust financial model developed by the Municipal Finance Corporation, and modified by HRWC staff to be more reflective of the utilitys requirements. The eight financing alternatives reflect differing levels of capital funding from depreciation, infrastructure funding from other levels of government, regional development charges, and debt. The alternatives reflect regional development charges at five different levels from the existing level (status quo charges), through to full regional development charges with growth paying for all growth. Regardless of the level of regional development charge, if the growth related capital projects proceed, the other available funding sources would be through the rate base (depreciation or debt servicing) or federal/provincial funding should it become available. If federal/provincial infrastructure funding programs become available, it is unknown whether they would be focused on compliance, asset renewal, or growth related projects or whether all three kinds of projects may qualify. The financing alternatives were evaluated using three general principles: 1. Rate stability and affordability, 2. HRWC long term financial sustainability, and 3. Intergenerational equity.
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The debt strategy report concludes that some appropriate ratios for HRWC to utilize are: 1. Target Debt Service Ratio of 35%, and 2. Target Debt/Equity Ratio of 40% / 60%. In essence, the two targets will serve as a framework for HRWCs strategy when considering future use of debt. Additionally, the report addresses the issue of affordability and refers to a study conducted by the National Consumer Center for the AWWA Research Foundation. The study, while primarily focused on affordability of water charges, also addresses the affordability of wastewater charges. In the report, affordability of user charges is stated to be 2% of average user, median income households each for water and wastewater; i.e. 4% for both utility services [Saunders et al. 1998]. The manual also refers to a range of 2.3% to 3% of median household income for combined water wastewater bills used by the Ohio Public Works Commission in 1999. As standards have become more stringent since the Saunders study was undertaken, the 4% could now be viewed as the lower end of the affordability range. Submission of the Debt Strategy to the NSUARB does not result in any immediate changes to HRWCs budget or rates. The Debt Strategy will however be a document that supports future budgets, business plans, and rate applications. The actual financial strategies that staff will recommend to finance future infrastructure requirements will be consistent with the recommendations from the Debt Strategy, but will be reviewed and updated on an annual basis to reflect changes in key assumptions such as: 1. Interest Rates, 2. Availability of Federal/Provincial Infrastructure Funding, 3. Approval and implementation of a Regional Development Charge, and 4. Financial Constraints posed by rates and affordability issues.
December 2012
5.5 Preferred Alternative

There is a necessary amount of additional technical and financial analysis needed to properly evaluate all of the alternatives presented above. Through more detailed analysis of the above alternatives, it is possible that some components of these alternatives may be combined to find an optimal approach. This will require continued input from the stakeholders, HRM, NSUARB, and internal HRWC staff. Based on the review by HRWC staff and its consulting team, and in full consideration of the stakeholder concerns, the preferred initial approach was to introduce the new RDC at a rate equivalent to the current regional charges as per alternative 5.4.5. This approach would establish the new RDC framework, consolidate the historical charges and provide consistent cost allocation while respecting potential economic impact of the full rate pending further review.
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HRWC developed a suggested rate structure, and collection method for further review and discussion with the Stakeholders as noted below. Table 6 Proposed Wastewater RDC Rates Unit Type SUD/TH MUD ICI Proposed Charge $ 1,470/unit $ 950/unit $ 6.14/m2 (base rate) Notes Based on 185.8 m2 (2000 ft2) dwelling Based on 111.4 m2 (1200 ft2)dwelling Assumes base equivalent to flows from retail/commercial/office (6/L/m2/day). The anticipated flows for each application will be reviewed prior to approval and the base rate will be adjusted to reflect the increase or decrease in flows. Flows provided by applicants designer, and shall be in keeping with ACWGM. Table 7 Proposed Water RDC Rates Unit Type SUD/TH MUD ICI Proposed Charge $ 375/unit $ 255/unit $ 1.57/m2 (base rate) Notes Based on 185.8 m2 (2000 ft2) dwelling Based on 111.4 m2 (1200 ft2)dwelling Assumes base equivalent to flows from retail/commercial/office (6/L/m2/day). The anticipated flows for each application will be reviewed prior to approval and the base rate will be adjusted to reflect the increase or decrease in flows. In the preferred alternative the RDC will be collected at the building permit stage for new construction or redevelopments. The residential rate will be strictly based on unit type and number of units within the application. The non-residential rate will be collected based on the area of the proposed building. The fees collected will be reviewed by staff and the proposed flows will be evaluated against the rates paid and adjustments to the fees collected will be made accordingly. For applications for connection to services not involving a building permit, HRWC staff will identify the fees to be paid on the New Service Application. All fees shall be paid in full prior to the water meter installation. This rate will be collected through HRM with the application for a building permit. Subsequent to the approval of an RDC by the NSUARB, coordination with HRM on the implementation time will impact when the rates can be collected will be required. Draft Regulation language for this alternative can be found in Appendix A-12.
December 2012
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Regional Development Charge Policy Review Interim Report 6.0 Stakeholder Meeting No. 3
December 2012
Stakeholder meeting No. 3 was held on December 18, 2012 and HWRC presented a summary of discussions to date and the preferred alternative as per Section 5 of this report. The presentation provided a summary of the six identified alternatives that warranted further review and highlighted that HRWC presented the alternative to establish the RDC framework, consolidate the historical charges and provide consistent cost allocation while initially respecting potential economic impact of the full rate pending further review. The Stakeholders were generally representatives of the HRM land development and building construction industry. The major issues raised by the Stakeholders included: HRWC is suggesting a specific framework be entrenched within the Regulations prior to full review and input from the Stakeholders. More time is required to engage Subject Matter Experts by the Stakeholders and provide proper input to the process. The alternative of maintaining the current status quo series of charges creates a similar financial cash flow but does not commit to a new framework ahead of full Stakeholder input. Stakeholders respect the position of the phased rate structure. Current position would force Stakeholders to formally and negatively intervene at the upcoming hearing, and they would prefer a more cooperative approach.
The stakeholder meeting notes, summary and a copy of the presentation are provided in Appendix A.
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Regional Development Charge Policy Review Interim Report 7.0 Continued Stakeholder Engagement and RDC Finalization
December 2012
HRWC established a suggested framework for the new Regional Development Charge (Section 5.5). However, the industry Stakeholders firmly believe that a full review and analysis process should be provided to ensure the most optimal solution is promoted. The stakeholder engagement process to date has been positive and an extension to this process will allow continued dialogue and an opportunity to work toward consensus on the required and desired RDC format. In a scenario where this extended process does not create full consensus, the process will provide the Stakeholders the opportunity to develop a formal and educated position on the proposed charge to ensure they can represent themselves within a formal process once the RDC is presented to the NSUARB for consideration. Maintaining the existing series of development charges during an extended review and analysis process will maintain current cash flows. HRWC recommends that the following time line be followed for the additional RDC analysis by HRWC and continued Stakeholder engagement. This would culminate in a formal RDC submission to the NSUARB by the end of June 2013.
Recommended RDC Finalization Time Line HRWC and Stakeholder Workshop on Alternatives Start of detailed review of assumptions and alternatives Interim progress meeting on review of assumptions and alternatives Final meeting on review of assumptions and alternatives Submission to NSUARB on Regional Development Charge Projected RDC Hearing Mid-January 2013 February 1, 2013 April 1, 2013 June 1, 2013 June 30, 2012 September/October 2012
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Appendix A
Regional Development Charge Policy Interim Report Stakeholder Consultation Process
A-1 A-2 A-3 A-4 A-5 A-6 A-7 A-8 A-9 A-10 A-11 A-12 Discussion Paper No. 1 Presentation for Stakeholder Meeting No. 1 Stakeholder Meeting No. 1 Notes Stakeholder Meeting No. 1 Summary Discussion Paper No. 2 Presentation for Stakeholder Meeting No. 2 Stakeholder Meeting No. 2 Notes Stakeholder Meeting No. 2 Summary Presentation for Stakeholder Meeting No. 3 Stakeholder Meeting No. 3 Notes Stakeholder Meeting No. 3 Summary Draft Rules & Regulations Language
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A-1 Discussion Paper No. 1
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APPENDIX A-1
Halifax Regional Water Commission Regional Development Charge
Discussion Paper No.1
October 15, 2012 Halifax Regional Water Commission

in association with G. A. Isenor Consulting Limited Blaine S. Rooney Consulting Limited R. M. Loudon Limited
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Table of Contents
1 2 3 Introduction..................................................................................................................................... 1 Background ..................................................................................................................................... 1 Infrastructure Requirements ........................................................................................................... 3 3.1 Integrated Resource Plan Drivers ........................................................................................... 3 3.2 Infrastructure Requirements to Facilitate Development ......................................................... 4 Existing Regional Charges.............................................................................................................. 5 4.1 Existing Regional Water Development Charge...................................................................... 5 4.2 Existing Regional Wastewater Development Charges ........................................................... 5 4.2.1 Existing Sewer Redevelopment Charge.................................................................................. 6 4.2.2 Existing Trunk Sewer Charge................................................................................................. 7 4.2.3 Existing Capital Cost Contribution Charge for Wastewater Treatment Facilities.................. 8 4.3 Existing Regional Stormwater Development Charges ........................................................... 9 Options for Regional Growth Related Charge................................................................................ 9 5.1 Principles for Utility Rate Design........................................................................................... 9 5.2 Review of Options ................................................................................................................ 12 5.2.1 Continuation of Existing Charges......................................................................................... 15 5.2.2 The Availability Charge........................................................................................................ 15 5.2.3 Industry Approach ................................................................................................................ 16 5.3 The Recommended Charge Format ...................................................................................... 19 5.3.1 Regional Development Charge Approach Recommended ................................................... 19 Mechanics of Regional Development Charge .............................................................................. 20 6.1 Basic Principles..................................................................................................................... 20 6.2 Factors Influencing RDC ...................................................................................................... 21 6.3 Options for Regional Development Charge Collection ........................................................ 22 Calculation of Regional Development Charge ............................................................................. 23 7.1 Calculation of the Proposed Regional Development Charge ............................................... 23
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List of Exhibits
Exhibit 4-1 Comparison of Existing Regional Charges (Wastewater) ................................................ 5 Exhibit 5-1 Bonbright Principles of Utility Rate Design................................................................... 10 Exhibit 5-2 COSS Proposed Principles of Utility Rate Design for HRWC ...................................... 11 Exhibit 5-3 Rating Scale for Scoring ................................................................................................. 12 Exhibit 5-4 Evaluation of Growth Related Charge Options .............................................................. 13 Exhibit 5-5 Sample of Ontario Development Charge........................................................................ 18 Exhibit 6-1 Comparison of RDC Collection Timing......................................................................... 22 Exhibit 7-1 - Simplified Schematic of RDC Calculation...................................................................... 24
List of Appendices
Appendix A - Growth related costs as detailed in the IRP ................................................................... 26 Appendix B - Development Charges in Ontario................................................................................... 32 Appendix C - Development Charges in Other Areas............................................................................ 39 Appendix D - Sample Ontario Calculation of Regional Development Charge .................................... 44
ii
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1 Introduction
The Halifax Regional Water Commission (HRWC) is undertaking a review the existing regional charges for water, wastewater and stormwater to determine if an improved method of calculation and recovery of growth related capital costs can be identified. Such capital charges do not cover asset renewal costs or costs related to meeting regulatory requirements for existing customers such costs will continue to be recovered from user rates, or other revenue sources. As part of the review process HRWC will be holding consultation meetings with stakeholders. Discussion Paper No. 1 provides background information and identifies, in broad terms, some alternatives for consideration.
2 Background
The HRWC is governed by the Halifax Regional Water Commission (HRWC) Act. Although owned by the Halifax Regional Municipality (HRM), it is an autonomous and self-financing utility regulated by the Nova Scotia Utility and Review Board (NSUARB). The HRWC Board is empowered to make by-laws, rules, regulations and policies consistent with the HRWC Act and the Nova Scotia Public Utilities Act. On August 1, 2007 HRM transferred its wastewater and stormwater operations and assets to HRWC which was already responsible for municipal water services within HRM. This moved wastewater and stormwater services from Municipal Council supervision to regulation by the NSUARB. The cost recovery for wastewater and stormwater services related to growth was based on regulations permitted under the HRM Charter (formerly the Municipal Government Act). For water, there were no cost recovery charges related to growth. Since the transfer of the wastewater and the stormwater assets to HRWC, all development and growth related cost recovery charges are now subject to NSUARB review and approval. At the time of the transfer of the wastewater and stormwater systems, the NSUARB approved the continued use of the regional based development related charges that were previously established by HRM. These charges are: Sewer Redevelopment Charge (SRC), Trunk Sewer Charge (TSC), and the Capital Cost Contribution Charge for Wastewater Treatment Facilities. These existing charges are defined in Chapter 4 Existing Regional Charges.
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The collection of regional based charges has been used to develop capacity within regional infrastructure. Essentially, capacity as it exists today, is already bought and paid for. The review of existing regional charges is for future growth related capital costs and to ensure that HRWC has sufficient funds to implement the necessary regional growth infrastructure. The NSUARB ordered the charges be reviewed in a Cost of Service Study (COSS) that was completed in November 20091. The report recommended that the Area Specific Capital Cost Contribution (CCC) Charge would continue to be used. It is site specific relating to area master servicing and not to regional infrastructure which is the focus of a uniform regional charge. It has been in existence for 15 years and has proven to be beneficial as a mechanism to allow growth within a specific area while being cost neutral to the existing customers of the utility. HRWC is recommending that the Area Specific CCC Charge mechanism be retained in its current format. As such it is not discussed further in this Discussion Paper. The Availability Charge was discussed at the September 13 -17, 2010 Public Hearing after which the NSUARB noted in its Decision: Paragraph 214 to 218 as follows: [214] HRWC has proposed the Availability Charge based on equity in the system. The Board is not certain whether this is the correct approach. However, the Board is concerned that there is an incremental impact of developments on the current capacity of the wastewater and stormwater systems, which will require the Utility to provide upgrading and provide additional capacity in the future. The timing of this would vary from site to site depending upon the unused capacity available in these systems and the intensity of development. [215] The Board also understands the Utility is facing a huge challenge to eliminate its infrastructure deficit and loss of these revenues will impact on its plans. [216] Later in this Decision, the Board has directed the Utility to study its long term infrastructure needs. The Board is of the view that before any decision is made, the Utility should review its financing options with and without the Availability Charge and its impact on the Utilitys ability to provide services.
HRWC Cost of Service Study, November 2009 G. A. Isenor Consulting Limited in association with W.H. Gates
Utility Consultants Limited and R. M. Loudon Limited
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[217] Clayton Developments Limited has raised the issue of the sewer redevelopment charge, which the current developers do not pay in the CCC charged areas. It has also suggested further consultation between HRWC and the developers before the Board makes its decision on this issue. [218] The Board agrees that approval of an Availability Charge as proposed needs further consultation with the development industry. Therefore, the Board does not approve the Availability Charge as this time and directs the Utility to: carry out a consultation process with stakeholders; do a more rigorous analysis; and include its results in the next rate hearing. Within its Decision, the NSUARB issued an Order for HRWC to develop an Integrated Resource Plan (IRP). The IRP is a long term infrastructure plan that outlines the capital expenditure needs for the water, wastewater and stormwater systems over the next 30 years. The IRP is now substantially complete and has played a key part in the direction taken by HRWC in developing this discussion paper as it has provided new and valuable information for the development of the proposed Regional Development Charge (RDC). With respect to Paragraph 216, the financing options with and without the Availability Charge are presented in the Debt Study.
3 Infrastructure Requirements
3.1 Integrated Resource Plan Drivers
The IRP was developed on the basis of three strategic drivers: Regulatory Compliance, Asset Renewal, and Growth. A series of objectives related to each of these drivers has been used to identify a range of capital investment needs for the water, wastewater, and stormwater infrastructure over the next 30 years. Projects and programs have been reviewed to allocate the proportion of the benefits to each of the objectives/drivers. The Regulatory Compliance driver covers projects/programs needed to address both current compliance issues (i.e. facilities for which HRWC is not compliant with current permits to operate or legislation) and to future compliance issues (i.e. requirements resulting from imminent or emerging legislation).
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The Asset Renewal driver covers projects/programs aimed at a sustainable approach to asset renewal and replacement. Asset Renewal requirements recognize the historical underfunding in some asset classes and evaluates the risk of continuing at the same level of reinvestment in the future. The Growth driver covers projects/programs aimed at providing regional level infrastructure to support growth and in managing flow allocations to optimize system capacity. Growth costs are assigned to the benefitting user as a result of development. They are not attributable to the existing customers as they are not benefitting from the services. For the purposes of the RDC Policy development, we have assumed that projects attributable to the Growth driver under IRP Objective 13 (Provide regional water, wastewater, and stormwater infrastructure needed to support growth.) would be used to form the development charge rate calculation. Regulatory Compliance and Asset Renewal projects would be funded by utility customers through the rates and charges or through any available funding programs provided by the Federal or Provincial governments.
3.2
Infrastructure Requirements to Facilitate Development
This discussion paper is focused only on the review and revision of HRWCs growth related charges. Within the context of growth related infrastructure, HRWC defines three categories of infrastructure: Local Infrastructure that is required to directly service (on-site or off-site) developing properties. Area Master Oversized or enabling infrastructure that is required to directly support the designated master planning areas and the specific development (both inside and outside the master plan area) and that is not considered Regional in nature. Regional Infrastructure that is required to provide core treatment, water transmission, trunk sewer collection services and their associated appurtenances. This infrastructure provides benefit to the larger serviced community and extends across master plan areas. Local and area master infrastructure are the direct responsibility of the developers. Local infrastructure can be installed directly by the developer to service new development or be facilitated by HRM through a Local Improvement Charge (LIC) Process to provide services to existing buildings. Regardless, under either scenario, Local infrastructure is paid for by the benefitting lands. Area Master infrastructure may be facilitated by HRWC and may be eligible for consideration through the HRWC CCC Charge policy. 4
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Regional infrastructure, due to its scale and long term perspective, will be programmed, funded, and managed by HRWC to accommodate cumulative growth with cost recovery through regional development charges. Historically under direction from HRM Regional Council, the Sewer Redevelopment Charge (SRC) was not collected in areas subject to an Area Master CCC Charge. With the 2007 merger with HRWC, the method of handling the SRC and the Area Master CCC Charges remained the same. The costs associated with area master infrastructure will continue as per the current practice associated with the Area Master CCC Charge. This discussion paper only addresses the recovery of costs to fund regional infrastructure resulting from growth in the service area.
4 Existing Regional Charges

4.1 Existing Regional Water Development Charge
There are presently no regional charges for the provision of regional growth related costs for water service.
4.2 Existing Regional Wastewater Development Charges

Three existing charges were developed by HRM. They are compared in Exhibit 4-1 in terms of the method of collecting the charge, the accounting method, application of the charges, revenue since the 2007 merger, typical projects the charges have funded, and issues related to the use of the charges.
Exhibit 4-1 Comparison of Existing Regional Charges (Wastewater) Sewer Redevelopment Charge Trunk Sewer Charge CCC Charge for WWTF Prior to issuance of building permit or when connected to system 3 Reserve Fund 2
Collection Timing
Prior to issuance of building permit
When existing dwelling connected to services
Accounting Method
Reserve fund 2
Reserve fund 2
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Application
For upgrading and over sizing of trunk sewer systems within existing developed areas 2
For upgrading and oversizing of trunk sewer systems within existing developed areas 2
For providing capacity in Wastewater Treatment Facilities $8,302,267
Revenue to date1 Typical Funded Projects Issues
$6,175,943
North Dartmouth Trunk Sewer Along Lake Banook
Eastern Passage WWTF
Charge is not directly attributed to cost of future growth related infrastructure Charge needs to follow cost causation principle Lack of clarity between the different charges Interpretation of when each charge applies
1. 2. 3.
Revenue from the existing regional charges since August 1, 2007 to April 30, 2012; the Trunk Sewer Charge and Sewer Redevelopment Charge are not differentiated in the HW reporting. In HRM By-law S-100, charges were to be paid into an account called the Sewer Redevelopment Account. In the NSUARBs Order, the wording was modified to reserve account and will be used to upgrade or oversize trunk sewers. Charge collected prior to issuance of building permit for new buildings in serviced areas. Charge collected at the time of connection to the sewer for properties occupied with a building prior to May 15, 2007 or additions of buildings accessory to residential use that generate wastewater discharges, upon connection to the wastewater system.
Following the transfer of the wastewater and stormwater systems to HRWC in 2007, the NSUARB issued an Order2 approving a Schedule of Rates and Charges for the Supply of Wastewater and Stormwater Services. Components of this order relating to the existing charges are generally described in the following sections.
4.2.1 Existing Sewer Redevelopment Charge

A SRC currently applies to new buildings that connect to central wastewater services. Historically, the SRC applies to new buildings and building additions in serviced areas. It applies to accessory buildings where the use results in an effluent discharge to the public sewer system. The SRC does not apply to buildings or building additions that were subject to a previous infrastructure charge for the purposes of new or expanded wastewater facilities or stormwater systems.
NSUARB rulings NSUARB-WW-HRWC-R-07 and R-08 dated March 3, 2008
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The existing Sewer Redevelopment Charge is discussed in the NSUARBs Order post-merger (Order Item 4). Specifically, the Order indicates: A Sewer Redevelopment Charge (Order Item 4) applies to new buildings in currently serviced areas. The funds are to be applied to upgrade or oversize trunk sewers. The wording of the Order relating to the Sewer Redevelopment Charge is as follows: A Sewer Redevelopment Charge shall be levied and imposed on all new buildings, including buildings which are moved onto a new lot, and all building additions in serviced areas. This charge shall be $0.30 per square foot of floor space. The payment will be due and payable to the Halifax Regional Municipality as agent for the Halifax Regional Water Commission, prior to the issuing of a building permit. The Sewer Redevelopment Charge shall only be payable in cases of accessory buildings that contain facilities which can discharge effluent to the public sewer. Notwithstanding, the payment of a Sewer Redevelopment Charge shall not apply to buildings or building additions which are located on a parcel of land which was subject to an Infrastructure Charge containing a component related to new or expanded wastewater facilities or stormwater systems. The Sewer Redevelopment Charge collected will be placed in a separate reserve account and will be used to upgrade or oversize trunk sewers upon application and approval of the NSUARB.
4.2.2 Existing Trunk Sewer Charge

As outlined historically in HRMs By-law S-100, the TSC applies to unserviced lots occupied by a building prior to the enactment of By-law S-100 at the time that lot is serviced. In the NSUARBs post-merger Order, the existing Trunk Sewer Charge is discussed (Order Item 5). The Order states: A Trunk Sewer Charge shall be levied and imposed on an unserviced lot of land occupied by a building when it becomes serviced with the wastewater and/or stormwater system. The Trunk Sewer Charge will be as follows: 1. Dwelling Units $500.00 per unit 2. All other Buildings $0.30 per square foot The Trunk Sewer Charge is due and payable to the Halifax Regional Municipality as agent for the Halifax Regional Water Commission when the land is serviced.
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The Trunk Sewer Charge collected will be placed in a separate reserve account and will be used to upgrade or oversize trunk sewers upon application and approval of the Board.
4.2.3 Existing Capital Cost Contribution Charge for Wastewater Treatment Facilities
The Capital Cost Contribution (CCC) Charge for Wastewater Treatment Facilities (WWTF) was introduced by HRM. This charge applies to all residential buildings (single-family and multi-unit dwellings) that will be connected to municipal wastewater facilities and all other non-residential buildings in the serviced areas. Unserviced lots occupied by a building prior to the enactment of By-law C-600, are subject to the CCC Charge for WWTFs when the building is connected to wastewater facilities. The charge also applies to buildings accessory to a residential use where there are effluent discharges to the municipal sewer system and this charge will occur at the time the connection is made. In the NSUARBs Order (Order Item 8), modifications to the charges were made to remove debt costs formerly covered in the user rates, and now recovered by the CCC charge. In its Order, the NSUARB cites the following: A charge in the amount of $877.00 shall be paid to the Halifax Regional Municipality as agent for the Halifax Regional Water Commission prior to the issuing of a building permit for all new single detached residential buildings that will be connected to the wastewater system. A charge in the amount of $584.00 per dwelling unit shall be paid to the Halifax Regional Municipality as agent for the Halifax Regional Water Commission prior to the issuing of a building permit for all new multiple unit residential buildings that will be connected to the wastewater system. A charge at a rate of $0.27 per square foot of floor space shall be paid to the Halifax Regional Municipality as agent for the Halifax Regional Water Commission prior to the issuing of a building permit for all other new buildings and building additions in serviced areas. When an un-serviced lot of land, occupied by a building, existed prior to the coming into force of these Rates and Charges, the charge shall be payable to the Commission, when the building is connected to the wastewater system. Buildings accessory to a residential use and containing facilities which can discharge to the wastewater system shall pay a charge at a rate of $0.27 per square foot of floor space payable to the Commission when the building is connected to the wastewater system.
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Funds collected under the Capital Cost Charge for Wastewater Treatment Facilities will be placed in a reserve account and used for providing capacity in Wastewater Treatment Facilities upon application and approval by the Board.
4.3
Existing Regional Stormwater Development Charges
At this time, there are no specific regional stormwater charges.
5 Options for Regional Growth Related Charge

In the NSUARBs order following the 2010 Rate Application, the NSUARB also directed HRWC to complete an Integrated Resource Plan (IRP). The IRP has provided additional data which allows for the consideration of a different approach to the Availability Charge model one that could be structured such that a dedicated water, wastewater and stormwater development related charge could be developed to address the growth related needs of each of the services independently. It is noted that the current charges do not directly address growth related costs associated with all three types of infrastructure. Based on having this additional information, three preliminary options for a regional growth related charge are presented for review and discussion at the first consultation meeting. These are: a) Continue with the existing charges; b) Adopt the Availability Charge (with agreed upon changes) as proposed in the 2009 Cost of Servicing Study, or, c) Develop and adopt a Regional Development Charge. Continuing with the existing charges does provide continuity, an approach consistent with the AWWA and WEF structures is industry best practice the for the development of these charges in North America
5.1
Principles for Utility Rate Design
To assist in the review of these options HRWC looked at the ten principles cited by the NSUARB in the January 23, 2008 Decision. In this Decision, the Board reminded HRWC that
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the utility rate design should, to the extent possible, adhere to the ten principles outlined by Bonbright et al3, at page 383-384 which are presented in Exhibit 5-1 below.
Exhibit 5-1 Bonbright Principles of Utility Rate Design
Revenue-related
Effectiveness in yielding total revenue requirements under the fairreturn standard without any socially undesirable expansion of the rate base or socially undesirable level of product quality and safety. Revenue stability and predictability, with a minimum of unexpected changes seriously adverse to utility companies. Stability and predictability of the rates themselves, with a minimum of unexpected changes seriously adverse to ratepayers and with a sense of historical continuity. (Compare The best tax is an old tax.) Static efficiency of the rate classes and rate blocks in discouraging wasteful use of service while promoting all justified types and amounts of use: a) In the control of the total amounts of service supplied by the company; b) In the control of the relative uses of alternative types of service by ratepayers (on-peak verses off-peak service or higher quality versus lower quality service).
2 3
Cost-related
Reflection of all of the present and future private and social costs and benefits occasioned by a services provision (i.e., all internalities and externalities). Fairness of the specific rates in the apportionment of total costs of service among the different ratepayers so as to avoid arbitrariness and capriciousness and attain equity in three dimensions: (1) horizontal (i.e., equals treated equally); (2) vertical (i.e., unequals treated unequally); and (3) anonymous (i.e., no ratepayers demands can be diverted away uneconomically from an incumbent by a potential entrant). Avoidance of undue discrimination in rate relationships so as to be, if possible, compensatory (i.e., subsidy free with no inter-customer burdens).
Principles of Public Utility Rates, James C. Bonbright, Albert L. Danielson, David R. Kamerschen, 2 nd ed. March
1988
10
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8 Practical-related 9
Dynamic efficiency in promoting innovation and responding economically to changing demand and supply patterns. The related, practical attributes of simplicity, certainty, convenience of payment, economy of collection, understandability, public acceptability, and feasibility of application. Freedom of controversies as to proper interpretation.
10
The November 2009 Cost of Service Study (COSS) reviewed the Bonbright principles and revised the wording for clarity and to reflect relevance and application to HRWC. The proposed rewording of the principles is outlined in Exhibit 5-2.
Exhibit 5-2 COSS Proposed Principles of Utility Rate Design for HRWC
Revenue adequacy
Effectively yield the revenue requirements in a fair and reasonable manner from the customers of HRWC without undue capital spending while meeting service and quality objectives. Provide revenue stability and predictability for HRWC with minimum of unexpected changes. Provide stable and predictable rates with a minimum of unexpected changes that have an adverse effect on HRWCs customers. Establish rate structures that discourage the wasteful use of the service provided while promoting all justified uses and amounts. Set rates that fairly reflect the benefits from the service provided. Set rates that are fair and equitable and that apportion costs of service among the different customer classes that are not arbitrary and capricious. Set rate structures that avoid discrimination in rate relationships and that avoid inter-customer burdens. Set rate structures that are dynamic and promote innovation and that respond to changing demand and supply patterns. Set rate structures that are simple to use and understand, convenient, understandable, economic to implement and maintain, and, are publicly acceptable while meeting the requirements of the NS Public Utilities Act.
2 3 4 5 6
Revenue stability Rate continuity Cost-based rates Fairness vs. benefits Defendable vs. costs
7 8
11
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10 11
Understandable Conservation
Set rate structures and rules and regulations that are unambiguous and easy to interrupt. Establish rate structure that promotes conservation while ensuring rates that are adequate to meet changing regulatory requirements.
5.2
Review of Options
The regional growth related charge options will be reviewed based on the above HRWC Proposed Principles as stated in the November 2009 COSS. Each option will be assessed and assigned a rating to reflect how well it meets the principle together with a comment on the rating. The rating scale is from 1 to 5 with a score of 1 indicating the option does not meet the principle and a score of 5 indicating the option fully meets the principle. Therefore, a higher score indicates a more favourable option. The full rating scale and description of the scores is presented in Exhibit 5-3 and Exhibit 5-4 as follows:
Exhibit 5-3 Rating Scale for Scoring
Score 1 2 3 4 5
Description Indicates the option does not meet the principle. Indicates the option meets some of the elements of the principle. Indicates the option meets approximately half of the elements of the principle. Indicates the option meets most of the elements of the principle. Indicates the option fully meets the principle.
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Exhibit 5-4 Evaluation of Growth Related Charge Options Continuation of Existing Charges Item Principle Score
1 Revenue adequacy Revenue stability 2
The Availability Charge Score

2
Regional Development Charge Score

4
Comments
The rate structure will not meet the long term need of the Utility as set out in the IRP The rate structure is stable and predictable
Comments
The rate structure will not meet the long term need of the Utility as set out in the IRP The rate structure is stable and predictable
Comments
Rates are based on necessary upgrades to meet projected future needs caused by growth. Rates will provide the Utility with a stable revenue source which will be updated on a regular basis Rates will change from the existing charges. Rates will require adjustment on implementation and will have continuity after that, particularly as a result of them being approved for a multi-year period. Rates will be based on cost estimates for regional growth component of future costs by service (water, wastewater and stormwater) The development community will only pay for that portion of the future costs that are caused by the need to accommodate growth The rates will be based on costs and will be updated on a regular basis
Rate continuity
The continuation of the rates will not involve any sudden changes for the development community
Rates will change from the existing charges. Rates will require adjustment on implementation and will be relatively stable after that
Cost-based rates
The rates have not been adjusted for a number of years and are no longer considered to be cost based Since the rates have not been adjusted they no longer represent the cost of providing services identified in the charge The rates have not been adjusted for a number of years and can no longer be defended as fair and reasonable
The rates are equity based, not cost based.
Fairness vs. benefits
The rates will fairly charge based on an equity basis
Defendable vs. costs
The rates are based on existing equity and not on cost
13
The rates were set by HRM Council and may no longer be fair to all customers The rates are static and the rate structure does not have an apparent adjustment mechanism in place While the rates are understood it is because they are existing and have been in place for a number of years.
The rates will charge customers based on the demand they place on the water and wastewater systems The rates can easily be changed as the equity in the system changes
Rates will be based on flows and not land use Rates will be adjusted on a regular ongoing basis and can be adjusted due to changing circumstances Rates are based on an assessment of future costs and the assignment of that portion of the future costs that are caused by growth. Rates have not been subjected to public consultation on acceptability. Rates will be based on projected flows from development on a per person basis Rates will be changed to reflect conservation based on the timing of future growth related construction DCs have no impact on conservation, but may be affected by it if infrastructure needs are reduced
Rates are simple to use but have not been subjected to public consultation on acceptability.
10
Understandable
Some parts of the rate structure are confusing to interpret Rates do not promote conservation as there is no apparent mechanism to adjust the rates based on conservation
Rates are understandable
11
Conservation
Rates do not promote conservation as there is no apparent mechanism to adjust the rates based on conservation
Total Score
26
34
45
14
5.2.1 Continuation of Existing Charges

The existing charges were taken over from the HRM at the time of the transfer. The derivation of these charges was done by HRM staff. The existing charges have been scored based on the Proposed Principles from the COS Study in Exhibit 5-4 and received the lowest score compared to the Availability Charge and the Regional Development Charge. If these charges were to be carried forward they would require a complete review of the cost recovery and an adjustment to meet the revised cost requirements. Given these limitations, the continuation of the existing charges is considered the least desirable of the options under consideration.
5.2.2 The Availability Charge

The Availability Charge was based on new development paying for equity in the system and was not based on the cost of future regional infrastructure required to service the new development. The concept was derived from the AWWA Manual (Fifth Edition) (M1 page 199) which discusses an Equity Charge. The equity method is based on the principle of achieving capital equity between new and existing customers. Sometimes referred to as the system buy-in method, this approach attempts to assess new customers a fee to approximate the equity or debt-free investment position of current customers. The financial goal is to achieve a level of equity from new customers by collecting an SDC (System Development Charge) representative of the average equity attributable to existing customers. HRWC proposed eliminating the Sewer Redevelopment Charge, the Trunk Sewer Charge and the Capital Cost Contribution Charge for Wastewater Treatment and replacing them with a single Availability Charge at the September 10 -17, 2010 NSUARB hearing. The NSUARB Decision did not approve the Availability Charge as it was constituted and the NSUARB ordered the HRWC to undertake a consultation process to identify a charge or charges appropriate for cost recovery for development related (growth) costs. The charge needs to be applicable to capital costs that are incurred by HRWC as a result of the new development. The proposed Availability Charge was based on achieving an equity position between new and existing customers of the system. The method assumed that the existing customers have provided equity in the existing system and that built-up equity should accrue to the benefit of the existing customers. It is recognized that this approach is most appropriate where the current facilities adequately serve existing as well as future customers, where there are no new significant system investment anticipated and where the existing facilities are not scheduled for replacement in the near future. The method was brought forward to the NSUARB hearing based on the information available on the system at that time. With the completion of the IRP, HRWC has a firmer understanding of the growth related infrastructure costs. 15
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This information allows HRWC to develop a charge that is linked to the growth related portion of the cost and thereby eliminating the need to rely on the equity or available capacity for establishing a charge. Further, the Availability Charge as proposed did not capture costs associated with providing future capacity.
5.2.3 Industry Approach

AWWA Manual M14 identifies possible objectives for adopting a capital cost recovery policy on page 198: Have new development pay its own way Fund major system expansion Generate sufficient cash to fund a portion of capital improvements Minimize debt Equitably recover capital costs from current and future customers Maintain an appropriate level of retained earnings and cash reserves to meet other capital needs of the system
The M1 Manual, on page 201 identifies the Incremental Cost Method as a methodology for establishing a development related charge: The incremental cost method is based on the concept of new development paying for the incremental cost of system capacity needed to serve new development. This approach proposes to mitigate the cost impact of new growth on existing customers user rates. The goal is to charge a fee for new customer sufficient to allow customer user rates to be revenue-neutral with respect to growth of the system. However, in systems undergoing rapid and expensive growth, this may be difficult to achieve. Although both the equity and incremental cost methods are both listed in the M-1 Manual, it is noted that the incremental cost method is cost based while the equity method is equity based. The Water Environment Federation (WEF) Manual of Practice No. 275 supports a similar charge as noted on Page 62: In many growing communities, the unit cost of expanding the wastewater system can exceed the historical or embedded cost of system assets constructed or acquired for existing ratepayers. This may be especially true in older established communities that experience
4 5
Principles of Water Rates, Fees, and Charges - AWWA 5 th edition pg 198 Water Environment Federation - Financing and Charges for Wastewater Systems WEF Manual of Practice No. 27
16
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sudden or rapid growth. To equitably assign this increased cost to future ratepayers, i.e. those causing the need to expand the system, many wastewater utilities have implemented System Development Charges (SDCs). System development charges, also known as plant investment fees, impact fees, tap fees, etc., are one-time payments typically collected from a builder or developer at the time a building permit or certificate of occupancy is issued, for new or expanded connections or service. For this reason, SDCs are considered an external funding source, i.e., monies come from outside the entity, from nonrated payers. When financed using SDCs, capital improvements associated with the expansion of the system are paid for by new customers as they connect to the system and pay the SDC. As such, these expansion or growth-related capital improvements are excluded from the calculation of user charges paid by all customers. In a growing community, SDCs can represent a very significant capital funding source, while at the same time addressing the objective of having growth pay for growth. Because SDC revenues are based exclusively on the amount or rate of new development, this revenue source can, on a year-to-year basis, be subject to a high degree of uncertainty and fluctuation. Furthermore, the utility may not have the luxury of waiting until a significant amount of SDC revenue has been accumulated to construct the needed facilities, e.g., a wastewater treatment plant expansion. As such, it may be necessary to use other forms of financing (e.g., long-term debt) to fund the facilities and rely on SDC revenues to repay the debt in part or in total. The Water Environment Federation Manual of Practice No. 27 states on page 87: Ultimately, there are several principles the utility needs to satisfy in developing the methodology, which are listed below Fee is proportionate to proposed impact, Fee proceeds are used to provide infrastructure serving the growth area (which may be the entire service area), Fee methodology is uniform and consistent, Other sources of funding are considered for capital improvements, and Fee includes only eligible growth related costs. Building on the AWWA and the WEF concept for the Incremental Cost Method and the System Development Charge, HRWC is proposing a Regional Development Charge (RDC) based on using a long-term projection of the capital investment required to service the planned growth in the service area. With the completion of the IRP, HRWC now has the long-term capital plan covering the three drivers (regulatory compliance, asset renewal, and growth refer to Section 3.1 above). The growth portion of the IRP capital plan provides the financial basis for calculating a Regional Development Charge. The growth related expenditures outlined in the IRP represent the costs associated with only the regional level infrastructure needed to support growth as projected by HRM. 17
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The Debt Study being filed by HRWC with the NSUARB on October 31, 2012 provides comprehensive financing options to support delivery of the IRP. The options presented include scenarios with growth related charges in the existing form, and scenarios with an enhanced Regional Development Charge. Regardless of the final form, the financial models identify that an enhanced Regional Development Charge to support growth related costs is important to enable IRP delivery within the constraints of maintaining affordable rates, and reasonable debt service ratios. Water, wastewater, and stormwater infrastructure must be built in advance of new customers occupying premises. Local and area master infrastructure costs are funded directly by the development community. Although Regional level infrastructure costs could be recovered from the user rates subject to NSUARB approval, it is common municipal practice to recover the costs such that future development does not burden the existing customer base. This is usually achieved either through construction by sub-dividers with the costs being transferred to the end user or new property owner or through construction by the utility with cost recovery by some form of levy from the new development. Ontario has a long history of levying Development Charges for growth. A sample of Development Charges from Ontario is given in the following Exhibit.
Exhibit 5-5 Sample of Ontario Development Charge
Region Local Lower Tier Upper Tier Education Total
Residential ($ per single detached unit) Durham Peel Halton York Oshawa Brampton Oakville Markham 6,920 24,324 14,102 18,707 18,521 17,566 25,427 24,189 1,199 1,759 2,576 2,020 27,405 43,649 42,105 44,916
Industrial ($/square foot) Durham Peel Halton York Oshawa Brampton Oakville Markham 4.35 6.30 11.92 2.31 5.93 12.066 9.98 2.31 10.28 18.36 21.90
Commercial ($/square foot) Durham Peel Halton York Oshawa Brampton Oakville Markham 2.89 9.16 6.30 11.92 8.78 8.49 12.06 24.15 11.67 17.65 18.36 36.07
18
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5.3
The Recommended Charge Format
Based on the above comparison and rating of the alternatives it is concluded that the best method of funding future regional growth related costs is through the implementation of a Regional Development Charge based on the Incremental Cost Method as listed in the AWWA Manual M-1 which is similar to the System Development Charge listed in the WEF Manual of Practice No.27. Such a charge is: consistent with development charges in other Canadian Municipalities, consistent with the methodology identified in AWWA Manual M-1, consistent with the methodology identified in WEF Manual of Practice No. 27, is cost based and therefore follows the cost causation approach which is more aligned with the Public Utilities Act , scored the highest compared to the alternatives using the COSS revised principles of rate design (based originally on Bonbrights Principles) The IRP details the costs for growth related capital costs for the 30 year horizon so these costs are known and the principle of growth pays for growth can be applied.
5.3.1 Regional Development Charge Approach Recommended

There are a number of factors which have led to the recommendation to develop a Regional uniform approach to recovering major infrastructure costs related to growth, as embodied in the recommended RDC. 1. The existing charges are fragmented and hard to follow as to what they recover and whether they adequately recover HRWC capital expenditures for growth. 2. The only utility that currently has a slate of regional charges is wastewater, which has three separate charges. If this approach was to be extended across all three utilities, there could potentially be nine separate charges being levied. This would be confusing for customers and complex to calculate. 3. The Availability Charge is based on historical investment. Although the approach may have its supporters, it is not an approach that is used in Canada. The approach favored is to tie charges to future actual costs related to servicing new customers rather than historical costs incurred to service previous growth. 4. An RDC that matches future related investment with growth results in charges which are demonstrably related to the cost of servicing that growth. 5. The uniform nature of RDC charges for each of the three utilities results in charges which are easy to understand and calculation is technically straightforward based on defendable allocations (growth costs, population projections).
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HRWC proposes to implement the Regional Development Charge based on the projected growth from HRM Planning and the identified costs related to development from the IRP.
6 Mechanics of Regional Development Charge

6.1 Basic Principles
The following basic principles were considered to guide the development of the Regional Development Charge (RDC). 1. The RDC is intended to recover costs related to regional level infrastructure constructed by HRWC to support growth based on HRMs growth projections. 2. The RDC will replace the existing Sewer Redevelopment Charge, the Trunk Sewer Charge and the Charge for Wastewater Treatment Facilities. 3. RDCs will apply to regional water, wastewater and stormwater infrastructure. 4. RDCs will be supported by analysis and a report with financial plans and customer growth projections. 5. The RDC will apply to development on land not previously developed or for redevelopment of existing property to a higher service level. 6. RDCs will apply to Master Plan Areas where an Area Master CCC Charge has been levied. 7. Eligible costs (net of applicable grants and subsidies) include capital costs as well as any administrative costs related to the RDC program such as the cost of preparing RDC reports and infrastructure studies. 8. RDCs will be calculated based on the average future cost of providing regional facilities for growth across the HRWC service area over the planning horizon. 9. The RDCs will be calculated based on the projected future capital programs and costs for previously financed works will not be included. 10. Costs will be developed and charged on a per person basis (based on highest and best use of the property.
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11. Costs and customer parameters will be projected based annual projections. 12. The RDCs will be recalculated and updated every 5 years. 13. RDCs for large users will be calculated based on projected flows by use and converted to a per person equivalent. 14. All RDC receipts will be deposited to a Regional Development Charge Reserve Fund with separate accounts for water, wastewater and stormwater. 15. The RDC calculation should result in a zero reserve fund balance at the end of the planning horizon. 16. HRWC, in response to HRMs regional planning process, will be responsible for long term master planning and implementing regional level growth projects.
6.2
Factors Influencing RDC
Several factors will continue to influence or inform the Regional Development Charge including changing regulations, HRMs Regional Plan update process, HRWC master planning (including updates to the IRP and the long term capital plan), timing of RDC reviews and updates, and public consultation. Changes to regulations in relation the Federal Fisheries Act or NSEs requirement for system management may affect how growth impacts existing infrastructure. Further, emerging regulation may require HRWC to control overflows at a minimum such that there is no increase in frequency and volume of overflows in the wastewater system. These influences will be factored into the calculation of the RDC. HRWC, in response to HRMs regional planning process, will be responsible for long term master planning and implementing regional level growth projects. HRM undertook its first Regional Plan in 2006 with the intention that it would be updated on a regular 5-year cycle. The Regional Plan is currently being updated through HRMs RP + 5 process. On a go forward basis, HRWC will use updated growth projections and land use plans from HRM to develop updates to master plans for water, wastewater and stormwater infrastructure. These master plans, together with plans done to address other business drivers (i.e. regulatory compliance, asset renewal), will be used to update HRWCs IRP. The IRP results in the development of the long term capital plan that further informs the calculation of the RDC.
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Regular updates of the proposed Regional Development Charge to ensure it is adequately funding the required long term capital plan while not over collecting from the development community will be required. HRWC plans to update the RDC every 5 years to coincide with the updates to HRMs Regional Plan. Public consultation will be an integral part of the RDC updating process. HRWC is committed to presenting the elements of the RDC to the stakeholder community. For this initial RDC development, two public consultation sessions are anticipated with stakeholders to discuss the options available and to seek input on the structure of the future development charge format. For ongoing RDC updates, consultation will be part of the overall process.
6.3
Options for Regional Development Charge Collection
Options under consideration for the timing of collection of Regional Development Charges include at the subdivision stage, at building permit stage, or at the time of meter connection. The subdivision and building permit processes are controlled by HRM. HRWC has control of the meter connection process however; it may not capture all redevelopment scenarios. Exhibit 6-1 provides a comparison of the three options for the timing of RDC collection.
Exhibit 6-1 Comparison of RDC Collection Timing RDC Collected at: Subdivision Advantages Captures largest proportion of charges Disadvantages Process is controlled by HRM, therefore there is a lack of internal control with the collection Process is controlled by HRM, therefore there is a lack of internal control with the collection Very late in the development process If it is a redevelopment site, the meter may not change and therefore not trigger collection of the fee
Building Permit
Suitable for collecting on site plan and infill developments Greatest point of control for HRWC
Meter Connection
Collection at the Building Permit stage will capture the development of all newly created lots and redevelopment of existing lots or buildings. It is the most appropriate timing for collections of the charge.
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7 Calculation of Regional Development Charge

The proposed RDC will be calculated based on inputs from the 30 year growth related costs from the IRP. This may need to be tailored to a shorter planning horizon for establishing the content of applicable capital projects and for a manageable implementation of the RDC. The total cost projected over the planning horizon divided by the population growth for the period will result in a cost per person rate for residential development. For non-residential development, HRWC is considering a population equivalent method. Although the RDCs may be calculated for the longer planning horizon, they will be updated on a 5 year cycle (maximum) with a rolling end horizon. To confirm the suitability of HRWCs approach, other jurisdictions were investigated to learn their methods for calculating development related charges used to recover capital costs of providing infrastructure to support growth. A review was undertaken of the calculation of development charges in Ontario where they are widely used by municipalities to recover their capital costs related to providing water and sewage system infrastructure to support growth (see Appendix D).
7.1
Calculation of the Proposed Regional Development Charge
Initial decisions are required to confirm the parameters used to establish how customers are charged the Regional Development Charge. HRWC proposes that the charge be done on a per person basis which is consistent with the method currently used for the calculation of the Area Specific Capital Cost Contribution (CCC) Charge. In the simplest of terms, the calculation of the Regional Development Charge (RDC) can be based on the following framework:
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Exhibit 7-1 - Simplified Schematic of RDC Calculation
20-year Capital Plan for Regional Growth Related Costs
Annual Growth from HRM Planning Staff (e.g., number of residential units or population equivalents?)
Determine What RDC Levels Will Yield a RDC Reserve Fund Balance of Zero at End of 20-year Period
Annual Growth HRM Planning staff to establish growth including number of residential units and related commercial/industrial. Develop a density-based charge for residential land use and convert to a person basis.
Expenditures Use the IRP process to define the long term regional growth related costs to be included in the RDC calculation. Historical debt that has a growth component (such as water treatment plant construction) has been previously funded by the existing development related charges and will not be included in the calculation of the RDC. Capital costs are projected over the planning horizon and identified by project and year of expenditure.
Calculation of RDC The total growth related costs are based on the projected infrastructure works needed to support the growth projections provided by HRM. The model will include a provision for the escalation of costs and the resultant RDC. 24
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The RDCs will be calculated such that they will result in a zero balance in the RDC Reserve Fund at the end of the planning horizon.
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Appendix A - Growth related costs as detailed in the IRP
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The Integrated Resource Plan (IRP) was initiated by HRWC pursuant to a NSUARB order and includes the preparation of a 30 year plan for infrastructure needs to renew existing infrastructure, comply with regulatory changes and support the planned growth. The proposed RDC will be calculated based on inputs from the 30 year growth related costs from the IRP. This may need to be tailored to a shorter planning horizon for establishing the content of applicable capital projects and for a manageable implementation of the RDC. Although the RDCs may be calculated for the longer planning horizon, they will be updated on a 5 year cycle (maximum) with a rolling end horizon.
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Table 1 Water Requirements for Growth
Water System
Required Spending for Development Related Costs $ 57,000 $ 22,000 $ 52,000 $ 52,000 $ 8,303,702 $ 750,000 $ $ 30,000 $ 30,000 $ 3,465,108 $ 750,000 $ $ 30,000 $ 30,000 $ 3,481,160 $ 750,000 $ $ 30,000 $ 30,000 $ 1,123,889 $ 750,000 $ $ 30,000 $ 30,000 $ 3,815,470 $ 750,000 $ $ 30,000 $ 30,000 $ $ 24,422,329
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Total
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Table 2
Wastewater Requirements for Growth
Wastewater System
Required Spending for Development Related Costs 33,970,000 6,921,000 97,500 15,627,494 0 750,000 42,407,975 1,222,500 194,496,963 0 750,000 18,638,065 22,500 72,044,508 0 750,000 3,680,000 22,500 202,049,605 0 750,000 22,500 17,001,644 750,000 18,880,000 22,500 22,500 0 $ 630,899,754
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Total
$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $
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Table 3
Stormwater Requirements for Growth
Stormwater System
Required Spending for Development Related Costs $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Total
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Table 4
Total Requirements for Water, Wastewater and Stormwater Growth
Total for Water, Wastewater and Stormwater

Required Spending for Year Development Related Costs 2013 $ 34,027,000 2014 $ 6,943,000 2015 $ 149,500 2016 $ 15,679,494 2017 $ 8,303,702 2018 $ 1,500,000 2019 $ 42,407,975 2020 $ 1,252,500 2021 $ 194,526,963 2022 $ 3,465,108 2023 $ 1,500,000 2024 $ 18,638,065 2025 $ 52,500 2026 $ 72,074,508 2027 $ 3,481,160 2028 $ 1,500,000 2029 $ 3,680,000 2030 $ 52,500 2031 $ 202,079,605 2032 $ 1,123,889 2033 $ 1,500,000 2034 $ 2035 $ 52,500 2036 $ 17,031,644 2037 $ 3,815,470 2038 $ 1,500,000 2039 $ 18,880,000 2040 $ 52,500 2041 $ 52,500 2042 $ 0 Total $ 655,322,083
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
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Appendix B - Development Charges in Ontario
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Development related charges are commonly used in Ontario municipalities as part of a wider cost recovery regime for water and sewage systems (as well as a range of other services) that are designed to recover the cost of providing infrastructure for new development from those benefiting. The approaches used have been built up over many years and are now considered common practice. Municipalities in Ontario are the entities with the responsibility for building and operating water and sewage systems. They are given this responsibility and are governed by the Province. Some municipalities may choose to transfer the responsibility to a utility, but the municipality is ultimately responsible. The Province sets the rules through legislation. The following sections provide an overview of how the system works in Ontario. 2-1 System Components
In terms of construction and cost recovery, water and sewage systems are divided into two categories major facilities and local facilities. The components are illustrated for water supply in the following diagram6. Diagram of Local vs. Major Infrastructure (Ontario) Treatment
Water Storage
Pumping Interceptor Mains
Major Facilities
Service Connection Water Hydrant Premises Private Portion Local Mains
Local Facilities
Diagram and some material taken from the HRWC Cost of Service Study dated November 2009.
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Although there are some different components, the concept is the same for wastewater and stormwater facilities. The components are described as follows: 1. Local Facilities This relates to the servicing, owned by the utility and on public property or easements that abuts and leads directly to properties being serviced. The works may be constructed either by the utility or more often in developments, by the developer. These facilities include: - Frontage mains including water mains and wastewater mains (sanitary sewers) unless specified otherwise across the front of properties with capacity for local servicing. - Service connections from a main to the property or street line. 2. Major Facilities This relates to major infrastructure normally built by the utility. Regional works include: - Treatment - Storage (water) - Pumping - Trunk mains - Intakes (water ) or Outfalls (sewage) 2-2 Overview of Growth Capital Cost Recovery
Facilities must be built in advance of new customers occupying premises. Ontario has a long history of allowing municipalities to recover the cost of providing water and sewage system capital facilities from new customers. Although such costs could be recovered from the user rates, it is common practice in Ontario to recover the costs in some way from the new customers either by construction by sub-dividers or construction by the utility and cost recovery by some form of levy. It has been Ontario government practice to legislate the options available to municipalities for the recovery of growth-related costs. For many years the methods were described in detail in legislation. With the methods thoroughly established, many methods are less proscribed now.
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Examples of methods used for local system costs are provided in the following table: Local Facilities Cost Recovery Method Facilities Connection Charge Service connection from Often a fixed charge main to street or property for a standard 18mm line, that is to the limit of water connection or the public right of way. charged at actual cost for larger sizes. Frontage Charge Often a fixed charge per metre depending on main size. Local Improvement Recovered in a variety of ways Provision by Subdivider Covered in subdivision agreements Main abutting a property.
Local servicing of existing area. Local servicing of new development
Description Covers cost of a service connection either being built for the customer by the utility or already in place and property now being developed. The portion of the service connection on private property is the responsibility of the customer. The charge is related to the needed size for a given type of development 150mm watermain for residential as an example. Oversizing costs usually covered by utility. Existing unserviced customers wish to have a system extension. Often initiated by petition. A subdivider wishes to develop an area. As part of the agreement, the subdivider builds and pays for local servicing. Once completed and approved, the works are turned over to the utility.
An example of local water and sewage infrastructure charges for the Region of Durham is as follows:
Durham Region Local Infrastructure Water & Sewage Charges Infrastructure Service Connection Frontage Water 19-mm - $2,900 fixed Larger at cost 150-mm - $176/metre Larger sizes costs also scheduled Sewage 100-mm - $3,300 fixed Larger at cost 200mm - $235/metre Larger sizes costs also scheduled
Note: The actual rate schedule is far more detailed and includes winter charges (summer shown) as well as other variations.
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Basically, whether built by the utility or by a developer, the cost of local facilities is paid one way or another by the benefiting customers. There can be variations in the method, depending on circumstance. In addition, there are variations in the establishment of charges, with standard charges often used to simplify matters and actual cost used in other cases. In all cases the decision on what cost recovery methodology to use and the quantum of the charges is entirely the responsibility of individual utilities or municipalities. Legislation is permissive, not proscriptive for these charges. 2-3 Ontario Development Charge (DC) Legislation
The situation is somewhat different for the recovery of the cost of providing major facilities. While local system costs are easily understood and established, the quantum and attribution of the cost of major facilities is much more open to interpretation. In Ontario, prior to 1989, municipalities imposed imposts or lot levies7 under a general provision in the Planning Act. The charges were on a case-by-case basis tied to subdivision approval. The charges were high enough that the development industry objected to the Province. A case was brought before the Ontario Municipal Board related to charges in the Region of Durham. The Region won in terms of being allowed to charge lot levies. Over time, this has resulted in a specific Development Charges Act (first passed 1989) covering what are now called Development Charges (DCs). The laid out the services that could be charged including hard services such as water and sewage as well as soft services such as fire stations. The calculation of the DCs also changed to a more system-wide average cost from the previous approach which was more site-specific. The salient legislation has been updated since first introduced and the current version is referred to as the Development Charges Act, 2007 (Statutes of Ontario, 1997, Chapter 27). The Development Charges Act clearly states that municipalities may levy DCs: 2. (1) The council of a municipality may by by-law impose development charges against land to pay for increased capital costs required because of increased needs for services arising from development of the area to which the by-law applies. 1997, c. 27, s. 2 (1). It also states what types of development may or may not be charged. (2) A development charge may be imposed only for development that requires, (a) the passing of a zoning by-law or of an amendment to a zoning by-law under section 34 of the Planning Act;
7
The term impost was initially used, lot levies was used as well and now they are referred as development charges.
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(b) the approval of a minor variance under section 45 of the Planning Act; (c) a conveyance of land to which a by-law passed under subsection 50 (7) of the Planning Act applies; (d) the approval of a plan of subdivision under section 51 of the Planning Act; (e) a consent under section 53 of the Planning Act; (f) the approval of a description under section 50 of the Condominium Act; or (g) the issuing of a permit under the Building Code Act, 1992 in relation to a building or structure. 1997, c. 27, s. 2 (2). (3) An action mentioned in clauses (2) (a) to (g) does not satisfy the requirements of subsection (2) if the only effect of the action is to, (a) permit the enlargement of an existing dwelling unit; or (b) permit the creation of up to two additional dwelling units as prescribed, subject to the prescribed restrictions, in prescribed classes of existing residential buildings. 1997, c. 27, s. 2 (3). Types of development that may not be charged are also set out: (4) A development charge by-law may not impose development charges to pay for increased capital costs required because of increased needs for any of the following: 1. The provision of cultural or entertainment facilities, including museums, theatres and art galleries but not including public libraries. 2. 3. 4. 5. The provision of tourism facilities, including convention centres. The acquisition of land for parks. The provision of a hospital as defined in the Public Hospitals Act. The provision of waste management services.
6. The provision of headquarters for the general administration of municipalities and local boards. 7. Other services prescribed in the regulations. 1997, c. 27, s. 2 (4).
The Act goes on to prescribe other issues as well. Section 5 sets out how the development charges can be determined. Basically the approach is to: Project a capital plan for 10 years, On a project by project basis identify what portion of the cost is growth-related, Separate growth related costs by customer class, Project the amount of growth by customer class
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Using the projected 10 years of data, development charges are then calculated by customer class. The most popular class would be residential, which may be further refined into charges for single family dwellings, apartments, duplexes etc. Less popular due to competitive concerns for being unattractive to business, but used categories include commercial and industrial classes. Again the quantum and classes used would depend on local preference. However, the development industry is quite vigilant and if a municipality strays from accepted norms then they might appeal to the press or complain to the Province. As set out in Section 33, DC receipts must be deposited into reserve funds for each service. The DCs are made up of components related to each service for which they are calculated. Thus, for example, the receipts related to a water system would have to be deposited into the water development charge reserve fund. The funds can only be applied against the growth related costs. Projects may also have other cost components, such as a replacement component, but the DC can only be applied to the growth related share. If DC receipts fall short due to timing issues, then funds can be borrowed and repaid from future receipts. If growth does not occur, the growth related costs may end up being paid from user rates.
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Appendix C - Development Charges in Other Areas
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The November 2009 Cost of Service (COS) Report included a review of provincial legislation related to the provision of capital works for growth in water and wastewater systems. The following sections have been taken from the November 2009 COS report and summarizes the findings of the review. 1 Local Facilities Capital Costs Enabling legislation for the recovery of local infrastructure capital costs from those benefiting exists in all of the provinces surveyed. Frequently growth is driven by subdivision developers, who construct the needed works and turn them over to the utility. Where the utility builds local works, or works near the development, cost recovery from the growth is also normal. Charges levied against property developers or individual owners of new buildings are used to this end. It is universally accepted that growth should pay the cost of local infrastructure. 2 Major Facilities Capital Costs Legislation regarding the recovery of major facilities capital costs from growth varied widely from province to province. Contributions from growth to major infrastructure costs for works provided by the utility are not universal: Who has charges to recover off-site capital charges? Of those surveyed British Columbia, Alberta, Saskatchewan, Ontario and Nova Scotia all allow capital cost charges for major facilities. New Brunswick does not. Ontario legislation seems the most fully developed in this regard. The Province has a long history using such charges and has a specific Development Charge Act, the only provincial legislation dedicated to charges expressly designed to recover capital costs for major facilities. To implement a development charge in Ontario, a municipality must first complete a development charge report which quantifies eligible growth-related capital costs and the amount of forecast growth upon which these costs are predicated. This report must be updated periodically. Terminology Terminology for CCCs varies; Development Charge (Ontario). Development Cost Charge (BC), Off-site Levy (Alberta), Development Levy (Saskatchewan) and Capital Cost Charge for Wastewater Treatment Facilities (Halifax). Cost Basis All appear to allow the cost of new or expanded works to be included in the off-site capital cost charge. Some appear to limit the charge to new investments. Alberta states An off-site levy may be used to pay for all or part of the capital cost of new or expanded water supply, sanitary sewage, and storm sewer drainage facilities Ontario also states Charges against land to pay for increased capital costs required because of increased needs for services arising from development of the area to which the by-law applies. The BC wording appears slightly less restrictive This charge is used to help pay the capital costs of providing, constructing, altering or expanding sewage, water. 40
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Saskatchewan appears less restrictive stating the capital cost of providing, altering, expanding or upgrading sewage, water, drainage.... Thus for some, only new works are permitted in the charge, while for others it appears that the cost of existing works with capacity to accommodate growth can also be recovered. Exemptions Some legislation specifically exempts some categories of customer such as cultural or tourist facilities, hospitals (Ontario) or affordable housing (BC), Basis for Charging Various approaches to charging are allowed including a fixed charge, fixed charge by zone, charge per dwelling unit, area based charge, frontage based charge, assessment based charge, and charges that vary by land use. Use of CCC Funds In all jurisdictions funds generated through CCCs must be sequestered in separate reserves to be used only for the intended purpose. Establishing a CCC Policy CCCs must be set up by bylaw. In British Columbia, Alberta, Saskatchewan and Manitoba legislation provides for certain CCCs to be overturned by petition of benefiting property owners. In Ontario, fees and charges can be challenged at the Ontario Municipal Board. Timing - Currently the wastewater development charge is levied on issuance of a building permit. In other jurisdictions, charges can be levied at other times notably when a subdivision development approval is granted thus allowing earlier receipt of charge revenues.8
The Ontario legislation provides considerable detail regarding timing of charges:
(2) A development charge may be imposed only for development that requires, (a) the passing of a zoning by-law or of an amendment to a zoning by-law under section 34 of the Planning Act; (b) the approval of a minor variance under section 45 of the Planning Act; (c) a conveyance of land to which a by-law passed under subsection 50 (7) of the Planning Act applies; (d) the approval of a plan of subdivision under section 51 of the Planning Act; (e) a consent under section 53 of the Planning Act; (f) the approval of a description under section 50 of the Condominium Act; or (g) the issuing of a permit under the Building Code Act, 1992 in relation to a building or structure. 1997, c. 27, s. 2 (2). Same (3) An action mentioned in clauses (2) (a) to (g) does not satisfy the requirements of subsection (2) if the only effect of the action is to, (a) permit the enlargement of an existing dwelling unit; or (b) permit the creation of up to two additional dwelling units as prescribed, subject to the prescribed restrictions, in prescribed classes of existing residential buildings. 1997, c. 27, s. 2 (3). Ineligible services
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Based on this review, local costs and extensions can be recovered from benefiting property owners or developers in all of the investigated provinces. Of the six provinces considered in this review, only New Brunswick does not have legislation authorizing CCCs to recover the cost of off-site infrastructure required to service growth. 3 Local Facilities vs. Major Facilities Costs Water, wastewater and stormwater systems are made up of different components, which may have different policies for cost recovery. The following segregation is proposed for discussion and policy purposes: Local Servicing This relates to the local servicing, owned by the utility and on public property or easements, that abuts and leads directly to properties being serviced, including: - Frontage cross the front of properties with capacity for local servicing. - Service connections between a main to the property or street line. - Local ditches and stormwater ponds. Utility (Developer) agreements cover new subdivisions. Frontage charges are used to recover the costs in some areas. For individual properties there is also a service connection charge policy for water. There is no similar charge for wastewater or stormwater. Upsizing Agreements Upsizing capacity built into or adjacent to local systems. It may include assets related to the development such as pumping stations or stormwater ponds where deemed necessary for servicing local areas. It may also relate to upsized assets such as oversized mains which are required to serve future development external to the local area. HRWC enters into Upsizing Agreements where it is deemed in the best interest of the Utility. Major Services This relates to major infrastructure normally built by the utility. The works covered include: - Treatment - Storage (water, stormwater) - Pumping - Trunk mains, secondary stormwater drainage systems - Outfalls There is a Capital Cost Charge for Wastewater Treatment Facilities (standard charges when building permits issued - for wastewater treatment, trunk sewers and pumping stations feeding trunk sewers). For water there is no similar charge, but one may be levied for new development to recover the cost or upgrades or expansion to major works
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The NSUARB Order of March 3, 2008 indicates that capital cost contributions are allowable and growth costs are eligible for some form of capital cost recovery: Water Systems Schedule C, Item 35 of the May 1, 2006 NSUARB ruling states: Cost factors shall include, but not be limited to the supply, storage, transmission, distribution, pressure control and fire protection requirements as required by the Commission. Wastewater & Stormwater Systems - The NSUARB Order of March 3, 2008 included Addendum B, Wastewater and Stormwater Capital Cost Contribution Policy stated in part: Oversizing components of a charge area may include, but are not necessarily limited to wastewater collection system including pumping stations and stormwater collection systems including retention ponds. The infrastructure required to service a charge area may be located outside of the charge area and may include land costs associated with providing required infrastructure (Policy 2.1). Infrastructure which is exterior to a charge area, such as wastewater treatment plants and related infrastructure may be included in the capital cost calculations. In any event, all costs of Oversized Infrastructure to provide service to the charge area will form part of the WWS CCC (Policy 2.2).
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Appendix D - Sample Ontario Calculation of Regional Development Charge
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Development charges (DCs) are widely used in Ontario by municipalities to recover their capital costs related to providing water and sewage system infrastructure to support growth. Infrastructure must be provided in advance of development. Major infrastructure (e.g. treatment plants, trunk mains, pumping, storage) is commonly built by municipalities. Development charges (DCs) are a tool available to Ontario municipalities which allows them to recover the cost of providing facilities from those benefiting rather than existing customers. Local facilities (e.g. mains abutting development) are either provided by developers at their cost or built by the municipality and charged back using various cost recovery approaches. The legislation governing DCs in Ontario is the Development Charges Act. It was first passed in 1989 and has been updated since9. Associated with this Act is Regulation 82/98. The Act provides a tool available to municipalities, which may or may not choose to use DCs as a cost recovery approach. For example, a municipality may target only certain classes of customers for DCs, may decide to absorb growth related costs or may proceed by agreement to recover costs.
Overview
The approach taken in the legislation followed teething issues between developers and municipalities. Several features of the adopted approach include: The charging of DCs is discretionary, but the Act spells out many elements of what can be charged, how it is calculated and adjustments for various factors. DCs are calculated for a municipalitys capital costs related to providing municipal servicing for development. In addition to development charges water and sewage, they can also be calculated for a number of other services, for example storm drainage, police, fire protection roads, and transit. The charges can be significant, reaching $30,000 to $40,000 or more per SFD unit and the water/sewage portion over half of the total. The legislation lists a number of services for which charges cannot be levied including cultural, entertainment and tourist facilities, hospitals and others. The charges are typically calculated by class of customer with residential charges universal and industrial or commercial charges less frequent. Residential are typically per unit, often
The Current Version is titled Development Charges Act, 1997 but it has had some amendments since. The latest
version, consolidated to December 2009, is available from the Ontario government website. http://www.e-laws.gov.on.ca/html/statutes/english/elaws_statutes_97d27_e.htm
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varying for single family dwellings (SFD) versus various types of multiple units. Commercial and industrial are normally charged per square foot of building. An average cost approach is used. That is DCs are calculated based on the average cost of providing facilities across a municipality. This simplifies and streamlines the calculation compared to an alternative marginal cost approach which is site specific. Residential charges are typically levelled against a developer as a condition of development, paid up front and ultimately absorbed as part of the dwelling sale price. The DCs must be supported by a background study.
Calculation of DCs
As a first step decisions have to be made as to what customer classes of customer are to be charged DCs and using what parameter. In Ontario, residential customers are commonly charged on a per residential unit basis. This may be refined to split out Single Family Dwellings, duplexes, apartments etc. A duplex unit might be counted as half a SFD unit, for example. Commercial and industrial DCs are charged on a per square foot basis. In the simplest of terms, the calculation of DCs is based on the following framework: Simplified Schematic of Ontario DC Calculation
20-year Capital Plan by Specific Project
Identify Annual Growth (e.g., number of residential units)
Deduct Replacement & Upgrade Costs = Growth Related Portion Determine What DC Levels Will Yield a DC Reserve Fund Balance of Zero at End of 20-year Period
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New Growth New growth annually for each customer category (residential, commercial and industrial) is projected annually. This provides number of residential units and commercial/industrial growth in square feet. If there are to be different DCs for different residential customer types (SFD, apartments, etc.), the relative water consumption per unit for each type could be used. This may result in a SFD with a weighing of 1 and an apartment of 0.5. These weightings would be used throughout the calculation to determine the relative charges. Some measure of capacity required by each customer class is needed. For example, water requirements for each class of customer could be projected based on current levels and the growth projections by units or square feet.
Expenditures: A background study is required prior to DCs being approved and this cost along with other costs related to the work on DCs can be included in the DC calculation. Historical debt which has a growth component (such as water treatment plant construction) can be included in the DC calculation, so the annual payment stream is projected. The growth related share would have previously been identified. Capital costs are projected for each year by project. Projections are by project so that the growth-related share can be isolated, since the share will vary by project. This is not necessarily a complete capital plan since there may be, say, roads projects which include only involve main replacement (no growth), so they need not be listed. Eligible costs are net of other contributions such as grants and subsidies, so these must be deducted. Replacement costs, which benefit existing development, or upgrade costs, are deducted from the total costs. Costs related to growth which cannot be charged to DCs should also be deducted. The residual is the growth related cost eligible for DCs.
Calculation of DC The total growth related costs are split by customer class using the measure of capacity factor calculated above. Ontario requires that DC receipts be deposited to a DC Reserve Fund. The monies in this fund can only be spent on the growth-related share of capital costs. 47
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The DCs for each customer class (residential, commercial, industrial) are calculated using spreadsheet models for each. The models track capital expenditures and receipts annually. The model can include escalation of costs and the level of DCs. For example the output could show DCs that have been escalated at, say, 3% per year. The level of DCs which result in a zero balance in the DC Reserve Fund at the end of 20 years is determined. Note that the DCs must be reviewed on a cycle that cannot exceed 5 years. Thus, although the DCs may be calculated for 20-years, it is only the first 5 years (maximum) that are established at this time.
This will result in DCs calculated for the various different customer classes and sub-classes. All of the DC classes might not be actually implemented.
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A-2 Presentation for Stakeholder Meeting No. 1
January 9, 2013
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APPENDIX A-2
Agenda Regional Development Charge Policy

Welcome & Introduction Background Infrastructure Requirements
Stakeholder Conference #1 November 1st, 2012
Existing Regional Charges BREAK Options for Regional Growth Related Charge Mechanics of the Regional Development Charge Open Discussion Next steps
The Mission of Halifax Water
Background
www.halifaxwater.ca
www.hrwc.ca
What is Halifax Water?
Water Assets
Operates in accordance with Act of Provincial Legislature with rules and regulations approved by NS Utility and Review Board. Operates like a business; governed by Board of Directors; owned by HRM. Self financed water utility; capital and operating budgets are funded directly from water, wastewater and fire protection revenue.
Pockwock Treatment Plant (227 ML/Day) Lake Major Treatment Plant (94 ML/Day) Bennery Lake Treatment Plant (8ML/Day) Six Small Plants (8,000 to 405,000 L/Day) 1,300 km of Transmission & Distribution Main 17 Storage Reservoirs (269 ML Capacity) 20 Distribution Booster Stations, 107 Pressure Control/Flow Chambers & 7,300 Fire Hydrants
www.hrwc.ca
www.hrwc.ca
January 9, 2013
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Wastewater/Stormwater Assets
15 Wastewater Treatment Facilities 172 Pumping Stations Over 2,000 kms of Pipe 37,000 Manholes, 17,000 Catch Basins 10 Retention Facilities/Holding Tanks All HRM ditches in urban core (approx. 600kms)
www.hrwc.ca
www.hrwc.ca
Events Leading to Regional Development Charge
Existing Regional Development Charges 2010 Rate application to the Nova Scotia Utility and Review Board (NSUARB) to replace the existing charges NSUARB 2011 orders:
Integrated Resource Plan (IRP) Cost of Service Study (COSS (including RDC)) Debt Study Consultation for the Availability/Development Charge
Infrastructure Requirements
New Concept for Development Charges
www.halifaxwater.ca
www.halifaxwater.ca
10
Infrastructure Drivers
Regulatory Compliance
Programs/projects needed to address both current compliance issues (being compliant with current permits to operate and legislation) and future compliance issues (requirements from emerging legislation)
COMPLIANCE
GROWTH
Asset Renewal
Programs/projects aimed at a sustainable approach to asset renewal and replacement
ASSET RENEWAL
Growth
Programs/projects focused on providing Regional level infrastructure to support growth
www.halifaxwater.ca
11
www.halifaxwater.ca
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Integrated Resource Plan

Is a comprehensive planning strategy Provides a long-term direction for Halifax Waters capital needs for water, wastewater and stormwater infrastructure Provides a framework for detailed capital investment analysis Incorporates assessment of risks facing Halifax Water Creates confidence in technical and financial analysis undertaken to support future rate applications to the NSUARB
Recommended IRP Expenditures by Driver

TOTAL$2,579million(30YearNPV) Regional infrastructureto supportGrowth
Compliance&Asset Renewalfunded throughutilityrates
www.halifaxwater.ca
14
Infrastructure Required to Support Growth

Local Infrastructure
Infrastructure required to directly service (both on-site & offsite) the developing properties

For the purposes of the RDC Policy, the focus is on the Regional Infrastructure This is the infrastructure that provides regional benefit to the overall serviced community including master plan areas The IRP identified Regional Infrastructure required to support growth
Area Master Infrastructure

Oversized or enabling infrastructure required to directly support designated master planning areas & specific development (both inside & outside the master plan area)
Regional Infrastructure
Infrastructure required to provide core treatment, water transmission, trunk sewer collection services & their associated appurtenances
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Existing Regional Charges

Sewer Redevelopment Charge Trunk Sewer Charge Capital Cost Contribution Charge for Wastewater Treatment Facilities
Existing Regional Charges
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Questions/Comments BREAK
Options for Regional Growth Related Charges
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COSS Proposed Principles of Rate Design

Revenue Adequacy
Yield revenue requirements

Fairness vs. Benefits
Reflect the benefit from the service provided
Revenue Stability
Provide stable and predictable revenue
Defendable vs. Costs

Apportion cost in a fair and equitable way
Rate Continuity
Provide stable and predictable rates
Fairness by Class
Avoid discrimination in rate relationships
Cost-based Rates
Discourage wasteful use of services
Adaptable to Changing Circumstances

Dynamic and promote innovation
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Simple and Acceptable
Simple to use and understand
Options for Regional Growth Related Charge

Status Quo
Charges set by HRM
Understandable
Easy to interpret
Availability Charge
Equity-based charge
Conservation
Promote conservation
Proposed Regional Development Charge

Cost-based charge
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Evaluation / Scoring of each Option
Evaluation of Regional Charges

Item Principle 1 Revenue adequacy Revenue stability Rate continuity Cost-based rates Fairness vs. benefits Defendable vs. costs Fairness by class Adaptable to change Simple & acceptable Understandable Conservation TOTAL
Based on COSS Proposed Principles for Utility Rate Design
Status Quo 2 4 5 1 1 1 3 2 2 4 1 26
Availability 2 4 3 2 3 2 4 5 3 5 1 34
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New RDC 4 4 4 5 5 5 5 5 3 4 1 45
Used scoring to evaluate options against principles Low score indicates option does not meet principle High scores meet principles
2 3 4 5 6 7 8 9 10 11
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American Water Works Association (AWWA) Approach

Have new development pay its way Mitigate the cost impact of new growth on existing customers Set a fee for new customers sufficient to allow existing customer rates to be revenue/cost neutral with respect to growth related capital costs
Water Environment Federation (WEF) Approach
Suggests a System Development Charge Proportionate to proposed impact Used for growth infrastructure only Method is uniform and consistent Other sources of funding are considered Includes only eligible growth related costs
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Regional Development Charge
Recommend Regional Development Charge (RDC)
Consistent with other Canadian Municipalities Consistent with AWWA and WEF Is cost based . follows cost causation approach of NSUARB Scored the highest against rate setting principles IRP provides 30 year estimate of growth related capital costs
Existing charges are out dated Existing charges only apply to wastewater Availability Charge based on equity not on cost of providing capacity for future growth RDC matches future investment with growth and allows the charge to match the cost of servicing for growth Method of calculation is understandable and can be applied to water, wastewater and stormwater
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Questions/Comments
Mechanics of Regional Development Charge
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Basic Principles of RDC

1. RDC will recover costs related to regional infrastructure to support HRMs growth projections 2. RDC will replace existing charges (Sewer Redevelopment Charge, Trunk Sewer Charge and Charge for WW Treatment Facilities) 3. Is applicable to water, wastewater and stormwater 4. Supported by analysis of long term needs, financial plans and growth projections
Basic Principles of RDC (continued)

5. RDC will apply to development on land not previously developed and for redevelopment of existing property to a higher service level 6. RDCs are applicable to areas where an Area Master CCC Charge has been levied 7. Eligible costs (net of external funding) include capital costs as well as administrative costs related to the RDC program such as related reports and studies 8. RDC will be based on average future cost of providing regional facilities for growth over the planning horizon
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9. RDC will be based on projected future costs & the costs for previously financed works will NOT be included (no charge for existing capacity) 10. Costs will be developed and charged on a per person basis (based on highest and best use of the property) 11. Costs and customer parameters will be projected based on annual projections 12. RDC will be updated and revised every 5 years 13. RDCs will be calculated based on projected flows by use and converted to a per person equivalent

14. RDC receipts will be deposited in a Regional Development Charge Reserve Fund with separate accounts for water, wastewater and stormwater 15. RDC rate will be calculated based on zero reserve fund balance at the end of the planning horizon 16. HRWC, in response to HRMs regional planning process, will be responsible for long term master planning and implementing regional level growth projects
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Options for RDC Collection
Collection at Building Permit Stage
RDC Collected at: Subdivision
Advantages Captures largest proportion of charges
Disadvantages Process is controlled by HRM Does not capture infill and redevelopment applications Process is controlled by HRM
Captures the development of all newly created lots Captures redevelopment of existing lots or buildings
Building Permit
Suitable for collecting on site plan and infill developments Greatest point of control for HRWC
Meter Connection
Very late in the development process If a redevelopment, the meter may not change
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Inputs Leading to RDC Calculation
Growth Input into RDC Calculation
HRM Planning staff establish projections for residential and employment growth
Growth Projections
(from HRM)
30-Year Capital Plan

(Regional Infrastructure)
Develop RDC
Present projections in terms of population equivalents (PEs)
Updated on a 5-Year Cycle

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Capital Input into RDC Calculation
Proposed RDC Calculation Method
IRP process defines long term regional growth related costs Capital costs are projected over the planning horizon and identified by project and year of expenditure in the IRP
Total Regional Infrastructure Cost (over 30 years) RDC(max) = Total Projected Growth (population equivalents)
RDC will be calculated such that it will result in a zero balance in the RDC Reserve Fund at the end of the planning horizon Updated on a 5 year cycle (maximum) SUBJECT to HRWC Board & NSUARB approval
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Open Discussion
Next Steps
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Next Steps
Gather stakeholder feedback (written feedback is encouraged) Revise Discussion Paper No. 1 as needed Prepare for Stakeholder Conference #2 (scheduled for November 15, 2012) Undertake the RDC Calculations
Contact Information
Kenda MacKenzie, P.Eng. Halifax Water

mackenk@halifaxwater.ca (902) 490-5029
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Questions or Comments?
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A-3 Stakeholder Meeting No. 1 Notes
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APPENDIX A-3
Halifax Water Regional Development Charge Policy Meeting Summary Stakeholder Session #1 November 1, 2012 Captain Spry Center ATTENDEES: Austin French Blaine Rooney Ben Young Chris Marchand Chris Millier Cathie OToole Gerry Isenor James Campbell Joseph Daniel Jamie Hannam Jim Spurr Kenda MacKenzie Kathleen ODonovan Mark Gilbert M. Sooriyakumaran Nola Button Paul Morgan Peter Polley Robert MacPherson Stefan Furey Valerie Williams (AF) (BR) (BY) (CMAR) (CM) (COT) (GI) (JC) (JD) (JH) (JS) (KMAC) (KOD) (MG) (MS) (NB) (PM) (PP) (RMAC) (SF) (VW) HRM HRWC Consultant Ramar Ramar Developments ARMCO Halifax Water HRWC Consultant Halifax Water Cresco/UDI Halifax Water Halifax Water Halifax Water Centennial Dalhousie University Annapolis Group Halifax Water HRM Polycorp/IPOANS ARMCO NSE Halifax Water
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Jamie Hannam welcomed attendees to the 1st stakeholder engagement process for Halifax Waters review of Regional Development Charges. Jamie stressed the importance of their attendance at this meeting in order to get their input to ensure that Halifax Water gets the charge direction done correctly. The two main focuses of this Stakeholder Meeting are as follows: 1. Review the discussion paper that Halifax Water placed on their external website on October 31, 2012 and ensure clarity regarding its content, and; 2. To seek input and feedback from the development community on the principles presented in the discussion paper. Jamie gave a brief background of Halifax Waters infrastructure needs (the Power Point Presentation will be posted to Halifax Waters website for information and will form part of the final report documentation). Gerry Isenor followed with a brief presentation of the principles of the new Regional Development Charge (RDC) concept and the details that are in the discussion paper.
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Halifax Water Regional Development Charge Policy Meeting Summary Stakeholder Session #1 November 1, 2012 Captain Spry Center Jamie described the infrastructure needs of Halifax Water in 3 categories:
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1. Asset Renewal We need to continually invest in the replacement of our existing assets. 2. Compliance With current Federal and Provincial Regulations and future regulations emerging, we need to enhance our infrastructure to become compliant. 3. Growth We need to build new regional infrastructure to accommodate growth within the region. Todays discussion will only involve the GROWTH component. The growth category is broken down into 3 components. These components clarify where the RDC will be applicable and where it is not. The categories of infrastructure are outlined in Discussion Paper No. 1 in section 3.2. Local Infrastructure that is required to directly service (on-site or off-site) developing properties. The cost for local infrastructure will be a direct cost to the developer. Area Master Oversized or enabling infrastructure that is required to directly support the designated master planning areas and the specific development (both inside and outside the master plan area) and that is not considered Regional in nature. The cost for area master infrastructure is direct to the developer and may be shared across a number of benefitting developments. Area master infrastructure may be facilitated through Halifax Waters capital cost contribution charge process. Regional Infrastructure that is required to provide core treatment, water transmission, trunk sewer collection services and their associated appurtenances. This infrastructure provides benefit to the larger serviced community and extends across master plan areas. Regional infrastructure will be planned and constructed by Halifax Water. The proposed RDC would be used to fund regional infrastructure projects.
Historically, Halifax Water has collected a range of Development Charges (i.e. Wastewater CCC Charge, the Sewer Redevelopment Charge, the Trunk Sewer Charge). Revenue collected through these charges has been used to fund wastewater infrastructure projects (for example, Eastern Passage WWTF Upgrade). With the creation of the Integrated Resource Plan (IRP), Halifax Water has used HRMs Regional Plan growth projections to establish regional infrastructure needs over the 30-year planning horizon. Regional water and wastewater infrastructure will be planned and constructed by Halifax Water and funded through the proposed RDC. Gerry Isenor reviewed the rate setting principles used for establishing the formula for calculating the Regional Development Charge (RDC). These rate making principles are presented in Discussion Paper No. 1 in Section 5.
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Halifax Water Regional Development Charge Policy Meeting Summary Stakeholder Session #1 November 1, 2012 Captain Spry Center
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After reviewing the principles, the various charge options were discussed: status quo, availability charge, and proposed RDC. Using the rate making principles and a scoring scale of 1 to 5 (with 1 being poor adherence to the principle and 5 being full adherence to the principle), the three rate options were scored. The RDC charge scored the highest. Looking at the industry associations, the AWWA (American Water Works Association) indicates that new development should pay its way, that the costs impacts of new growth on existing customers should be mitigated, and that a fee for new customers should be set sufficient to allow existing customers rates to be revenue or cost neutral. The Water Environment Federation (WEF) indicates that the charge should be proportionate to the proposed impact, should be used for growth infrastructure only, and should be uniform and consistent. Following the regional planning framework that includes periodic updates, the RDC is expected to be updated on a 5-year basis. The intended mechanics of the RDC were reviewed. These are outlined in detail in Section 6.0 of Discussion Paper No. 1. NEXT STEPS: Following this stakeholder meeting the following tasks will occur: Gather stakeholder feedback Halifax Water welcomes formal feedback on the comment form provided or through email to Kenda MacKenzie at mackenk@halifaxwater.ca. Revise Discussion Paper No. 1 as needed Revisions may be needed to Discussion Paper No.1 as a result of our consultation. Ultimately, we will be compiling a report that will contain the information in the discussion papers, the stakeholder process, the recommended charge, and any supporting documents. Stakeholder Meeting No. 2 The next stakeholder meeting is scheduled for a couple of weeks from today. We can use that meeting to present the calculation and allow the stakeholders more time to understand the proposed RDC and provide feedback. We can then schedule a third stakeholder meeting a few weeks after the second meeting. Individual or small group sessions Also noted was that if the stakeholders want to meet with Halifax Water individually to have private discussions, we would welcome that or we could come to you to speak to any groups that may require more information regarding the RDC.
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A-4 Stakeholder Meeting No. 1 Summary
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Meeting Summary Stakeholder Meeting # 1, November 1, 2012 Halifax Water Regional Development Charge Policy Review Glossary of Acronyms ADF AWWA CCC CCME COSS CSO ERA HHSP HRM HRWC HW HWB ICI I/I IRP LOS LIC Average daily flow American Water Works Association Capital cost contribution Canadian Council of Ministers of the Environment Cost of service study Combined sewer overflow Environmental risk assessment Halifax Harbour Solutions Plants Halifax Regional Municipality Halifax Regional Water Commission Halifax Water Halifax Water Board Industrial/commercial/institutional Inflow and infiltration Integrated Resource Plan Levels of service Local improvement charge NSE NSP NSUARB O&M PPE RDC RWWFP SRC SSO SW TSC WEF WSER WSP WW WW CCC WWTF
APPENDIX A-4
Nova Scotia Environment Nova Scotia Power Nova Scotia Utility and Review Board Operations and maintenance Per person equivalent Regional Development Charge Regional Wastewater Functional Plan Sewer Redevelopment Charge Sanitary sewer overflow Stormwater Trunk Sewer Charge Water Environment Federation Wastewater systems effluent regulations Water supply plant Wastewater Wastewater Capital Cost Contribution Wastewater treatment facility
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Meeting Summary Stakeholder Meeting # 1, November 1, 2012 Halifax Water Regional Development Charge Policy Review Item Comment or Question # At the Stakeholder Meeting 1 Is this going to be an additional charge to other charges that we see now or is this going to replace these existing charges or some of them will go away? 2 Response /Explanation
3 4
6 7
As of right now, we see the sewer redevelopment charge and the trunk sewer charge (only one applies currently depending on timing) and the Regional Wastewater CCC being completely replaced by this new RDC. While we are currently collecting development charges, there are questions such as: 1) are we collecting enough? 2) Are we using the right tool? 3) Are the charges fair and equitable? In the pie chart that showed the drivers [reference These costs represent the regional infrastructure required for regional growth only. We did to slide 14 of presentation], can you confirm that the not study the projected costs of the local or area master infrastructure for new amount shown is only for regional growth or is that development activity because we do not have a direct relationship to that cost. for all growth? In terms of people who are building in areas that are Our concept today is that it would be a single charge equal across HRM versus tiered for one not incurring the vast majority of regional area of Dartmouth versus the Peninsula versus Bedford West. We do not envision a tiered infrastructure, would there be a tiered system? approach. In reference to the pie chart on slide 14, do the costs The pie chart covers water, wastewater, and stormwater costs across the three IRP drivers cover both water and wastewater? And are the costs asset renewal, regulatory compliance, and growth. For the growth component, the costs broken down by infrastructure type? cover water and wastewater infrastructure only as there are no regional infrastructure requirements related to stormwater at this time. We can provide the breakdown of costs by infrastructure type. How did you determine the preferred cost Initially, 28 resource plans were identified ranging in plan costs from approximately $1.9B to alternative in the IRP (range from Band-aid to $3.0B. A number of the objectives included variations on the implementation timing and the Cadillac approach)? asset renewal driver included a variation on the level of reinvestment. Through a range of criteria, the plans were refined to select the preferred resource plan that would deliver the required regulatory compliance objectives, and the composite asset renewal program. The resulting preferred resource plan has an estimated cost of $2.6B. Full details of the IRP resource plan evaluation process are available in the final report found on the Halifax Water website at: http://www.halifax.ca/hrwc/ with the documents filed under October 31, 2012 Integrated Resource Plan. Figure 5.2 Plan Formulation and Evaluation will be particularly helpful. Do you think in the future there will be more Pockwock is one of the infrastructure components that even in the 30 year horizon we dont possible connections to Pockwock? envision the need to expand as a result of growth. Does growth refer to extension of services or is Growth refers to new people in an area. This could be from densification of an existing area densification within the current service boundary or a new subdivision. It does not include service extensions to existing unserviced areas as a also considered? result of inadequate water or sewer servicing. Those service extensions are typically funded Page 2 of 7
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Meeting Summary Stakeholder Meeting # 1, November 1, 2012 Halifax Water Regional Development Charge Policy Review Item # Comment or Question Response /Explanation
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via local improvement charges (LICs) and are capital cost neutral to the utility. When new connections are made via LIC, the new customer will be subject to the RDC. Do the American Water Works Association (AWWA) Yes, similar to the response to question 7, growth includes densification (increasing density and the Water Environment Federation (WEF) define through redevelopment) and new growth areas (new population connected to the system). growth the same as Halifax Water does? While the AWWA/WEF dont use the exact same words, it is clear that the fees in either manual are required to cover the costs of any improvements in the system that result from the added loading (wastewater) or demand (water) placed on the system as a result of development. Can you confirm if renovation permits would be Yes for the purposes of the proposed RDC collection, building permits and renovation considered to be building permits in terms of the permits are considered similar, where the renovation results in an increased net equivalent proposed RDC collection? population/density. What will be the test for borrowing to fund Halifax Water has risk-based criteria for when borrowing is needed to cover a project that infrastructure? exceeds the value of the reserve fund. This borrowing would be subject to Halifax Water Board and Nova Scotia Utility and Review Board approvals. But because we are using a 30 year planning horizon, we will be able to manage using utility debt capacity. Do you also have some restraints on how far out you This would be managed in the assessment of risk related to borrowing and the 5 year can borrow (i.e. 10 years out)? update cycle will help smooth this out. If you are looking to the Regional Plan to determine Generally, because it is a regional charge, we can predict growth numbers based on the regional infrastructure needs, there is nothing to historical trends even if actual locations shift to a different location. However, the process commit HRM to actually build what is in the plan. relies on good planning implementation and coordination between Halifax Water and HRM. What happens if you build in a particular area and As well, the 5 year update cycle will help to minimize significant changes to planning Council changes the priorities? priorities. If there is an unpredicted shift in growth before the 5 year update, Halifax Water will have the ability to make necessary adjustments. So with 5 year updates, would you take on the next That is the intent. And we would like to tightly integrate this process with HRMs regional 5 years growth allocation and still zero out at the planning update cycle to be in lock-step with these master planning exercises. end of the 30 year period? The concept of highest and best use was For the purposes of predicting flows for the system, we use the concept of highest and best mentioned in relation to land use. How can you use of the land. This ensures that we are not underestimating the flows to be generated predict this and how do you determine the right mix from the development. In terms of predicting proportions of commercial versus residential between commercial and residential usage? land use, some planning jurisdictions let the market dictate the split while others take a more proactive approach based on historical planning trends from similar communities. A specific population base supports a range of commercial development in addition to other uses (i.e. parks, libraries, medical services including hospitals, transit, etc). This is just good Page 3 of 7
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Meeting Summary Stakeholder Meeting # 1, November 1, 2012 Halifax Water Regional Development Charge Policy Review Item # 15 Comment or Question Response /Explanation
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long term planning. Ultimately, the planning authority must determine the correct balance. Can you clarify how this is done for If the question is related to the proportional allocation between ICI and residential, this is a industrial/commercial/institutional (ICI) land uses? planning or development industry question please refer to the response to question 14 above. However, if you are referring to calculating projected flow rates (in keeping with ACGWM) over larger scale ICI lands without the specific development known, we would look at a typical blended rate, convert the square footage to a per person equivalent, and estimate the flows. Why is this decision being made already to use a Are you suggesting that you think we should look at tiered rates? What might be the postage stamp rate? It would be quite simple to complexities or issues of a tiered system? Should we do an internal analysis to consider have a tiered rate. what that might look like and prepare an advantage/disadvantage analysis? We could review the effort required to complete some more analysis on this if it is important. You also need to remember that infrastructure may not be installed in a specific sewershed, however, its installation frees up capacity in existing sewershed so you do get indirect benefits. The regional concept allows for flexibility in management of the wastewater systems (i.e. diversions between sewersheds). You dont want to have a differential rate structure Correct. Good planning should be the driver for where growth should occur. to actually turn into the driver either. How do you propose to deal with payments where Currently, if you are inside a local CCC area and you pay that charge for the defined Master sometimes builders versus developers pay the extra Plan area, then you DONT pay the sewer development charge. charges? On a go forward basis, the new RDC would apply to all lands being developed in the urban core. If there was an area specific CCC in your Master Plan area, you would pay that as well. These are two different charges for two different areas of infrastructure (area master versus regional infrastructure). The CCC is for the area specific infrastructure required to service the development/master plan area and the RDC is for Regional infrastructure (e.g. treatment plants). Who pays for the RDC? We are currently proposing that the RDC would be payable at building permit stage. Therefore, the sub-divider pays the CCC, if applicable, and the builder would pay the RDC. So if this new charge goes into place, what I That is correct. This is because we see them as discrete charges for discrete groups o f understand is that there is no exempt credit or growth infrastructure. It is more by historical municipal rules that there is a waiver on the discount of the RDC? sewer redevelopment charge if you happen to pay an area specific CCC. Whats happening now is there is not a full recovery of the appropriate charges. We need to move towards appropriate and adequate charges. These two charges are discrete and do not overlap on Page 4 of 7
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the same infrastructure in any way and thus both need to be applied. Going forward we are trying to keep this simple RDC for regional infrastructure and area CCC for area master infrastructure. On a go forward basis, how do you differentiate In a circumstance where a piece of regional infrastructure that was required for growth was between asset renewal and growth? to oversize a trunk sewer, and at the same time that infrastructure is at the end of its asset life, we would fully finance the asset renewal portion of the works through the rate base for replacement of the existing asset to its original size and the incremental portion attributed to the growth oversizing, would be funded from the RDC. Do we have a timeline for this implementation? We are going to the NSUARB in mid-January 2013 for consideration at an April 2013 hearing for the rate application. There hasnt been any concrete discussion about Halifax Water does currently work with HRMs planning team and we do provide utility input your planning horizon and the regional plan horizon already to the regional planning process. We are fully aware of their current planning or directions. Are you bringing them together? It horizon and have used that information in its fullness to develop our growth requirements doesnt sound like there has been a concerted effort for both the RWWFP and the IRP. We are very encouraged that we will run our 5-year cycle to harmonize these do you think it will happen? in step with HRMs regional planning update cycles. For areas now that pay CCC and no SRC, would we Subject to NSUARB approval, we would suggest that as of an effective date of RDC coming then be charged RDC? into force, it would replace the three existing charges and be applicable across all development activities. What about master plan areas? We would be suggesting that the RDC would be applicable inside those areas RDC applies to regional infrastructure; area CCCs apply to master plan area infrastructure. As well, there is a defined rule set for existing charges (SRC, TSC, WW CCC). When we replace these charges with the new RDC, then the new RDC rules would apply and all the old charge rules will disappear. Area Master plan agreements do not apply to Regional infrastructure they only apply to local and area master infrastructure. There is no overlap of the RDC. Both now and/or at the rate hearing. The purpose of the stakeholder outreach is to provide our thoughts on how the new RDC will be structured, calculate, and collected to the stakeholder community. We hope to have good dialogue between us so we can work with the stakeholder groups to fullest extent we are able to given our governing Rules and Regulations. We encourage stakeholders to put their comments and concerns in writing so we may have something specific to respond to. And we recognize that maybe we are not seeing a particular type of implementation issue/risk if we understand those risks, we can Page 5 of 7
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Is our time to dispute this charge now or through the NSUARB hearing?
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at least consider them in our analysis. At the end of the day, stakeholders are welcome to participate more formally in the rate application hearing through the NSUARBs process. If Nova Scotia Power (NSP) was presenting The distinct difference is that NSP is an investor based utility, whereas Halifax Water is a something like this [up front development charges], municipal based utility. NSP can earn profit whereas Halifax Water cannot (we can only there would be a riot. break even). The only way Halifax Water can raise capital is through municipal financing.
However, this is a good point. Halifax Water can provide better clarity regarding the differences in utility structures and financing methods between NSP and Halifax Water. Written Comments Received Outside of the Stakeholder Meeting 28 Can you please advise exactly what steps Halifax At the time that the update was submitted to the NSUARB on the status of the Availability Water has taken since the December 2010 URB Charge, internal consultation amongst Halifax Water departments and the consultant had order to engage in consultation with the occurred. There were further discussions/consultations amongst HRM staff relating to the development/building communities (handouts, proposed changes to the regional based charges. The outcome of this internal consultation minutes, etc.), and where this current RDC process of process is contained within the Discussion Paper 1. The first external stakeholder consultation was held on November 1, 2012. A second session is planned for November 15, consultations fits into those prior consultations? 2012. Interested parties may submit comments in writing as well. 29 It is our understanding that the change in charges is Halifax Water has developed a Master Plan for the projected growth over the next 30 years in an effort to fund future regional growth based on and will embark on creating an implementation plan. Our implementation plan will be an incremental cost method. Contained within the based on the proposed timing in the Regional Plan. Ultimately HRM will determine where Basic Principles section 5 of Discussion Paper No. service boundaries are extended or intensification occurs, however, it is our intention that 1, the paper states that it is for the purpose of the capacity of the regional infrastructure systems will not be a factor. This is provided development of lands not previously developed or there are no changes to regulations from our regulator(s) that would prevent upgrades to for redevelopment of existing properties to a higher the system as planned and that the planning horizons identified in Halifax Waters standard. Our understanding of this is to enable implementation plan are adhered to (that is, if we anticipate a specific regional expansion of the service boundary that currently infrastructure project in Year 20, we will plan for that project consistent with a Year 20 exists as per development of lands not previously implementation horizon requests to deliver the infrastructure earlier than originally developed. The developer will have to pay the planned will be difficult to accommodate both technically and financially). Some of these incremental costs as per the intent of the potential timing adjustments can be captured during the regular master planning and RDC Development charges and in return will be provided updates. with some predictability in costing to undertake each project. More importantly HRM in the past has The local downstream constraints will still have to be managed and the associated upgrades stated that due to capacity issues, the service will be undertaken by the developer. boundaries could not be expanded. If the program is Page 6 of 7
Meeting Summary Stakeholder Meeting # 1, November 1, 2012 Halifax Water Regional Development Charge Policy Review Item # Comment or Question to foster future growth and the developer pays the cost we assume the discussion of capacity issues will no longer be a barrier to development. HRM may choose to present other reasons for not approving projects, however, the issue of sewer capacity or expansion of the service boundary should no longer be in question. Please confirm our interpretation of your intent is accurate. Who will be responsible for making the decision to expand the service boundaries and what protocols will have to be followed? Regarding the redevelopment of existing properties to a higher standard, our understanding is that this should take the limits off the density being requested as it pertains to the sewer capacity. Serviced lands that are currently zoned for R1 dwellings could be altered to R2 townhouse or multi-unit without the limitations of sewer capacity as has been the case in the past. Please confirm that our interpretation of your intent in this regard is also accurate. During the presentation, it was explained that the new Regional Development Charges will replace the existing Sewer Redevelopment Charge and the Trunk Sewer Charge. Our understanding is that these changes would happen simultaneously. Will HRWC consider the implementation of alternate applications to treat wastewater such as a Zenon Filtration System? This is an application that has been presented in the past to HRM as an alternative to connecting to the existing infrastructure. Response /Explanation
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HRM Planning and Regional Council determine extensions to service boundaries, in consultation with a number of agencies.. Further to item 29 above, and subject to capacity analysis of the area under consideration, there may be local infrastructure upgrades or improvements necessary to accommodate the intensification proposal. These improvements would be the responsibility of the cost causer (developer/builder) and therefore would need to be part of the servicing design for the intensification project (designed, constructed, and paid for by the developer/builder).
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That is correct.
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Halifax Water would have to consider the ability of the system to meet the regulations of NSE, DFO, and NSUARB. Additionally, Halifax Water will look at service options that present the best life cycle treatment solution for the utility. Consolidated treatment systems are preferred over new stand-alone facilities.
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A-5 Discussion Paper No. 2
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APPENDIX A-5
Discussion Paper No.2 Draft Calculation of Regional Development Charge
November 15, 2012
Prepared by Halifax Regional Water Commission in association with G. A. Isenor Consulting Limited Blaine S. Rooney Consulting Limited
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Table of Contents
1.0 Overview................................................................................................................................... 3 2.0 Estimated Growth .................................................................................................................... 4 3.0 Projected Infrastructure Costs.................................................................................................. 4 4.0 Calculation of the Charge ........................................................................................................ 4 Appendix A Projected Populations............................................................................................ 10 Appendix B Annual Infrastructure Costs................................................................................... 11
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1.0 Overview
The Stakeholder meeting on November 1, 2012 discussed the history and policies related to the Regional Development Charge (RDC) as outlined in Discussion Paper No. 1. As a follow-up to that meeting HRWC has prepared the first draft calculation of the Regional Development Charge based on the information from the Integrated Resource Plan (IRP). As noted in the presentation the RDC would be calculated based on the HRM Growth Projection and the 30 year Capital Plan.
Growth Projections (from HRM)
30-Year Capital Plan (Regional Infrastructure)
Develop RDC
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2.0 Estimated Growth

The growth inputs are from HRM Planning and have been completed in 5 year increments. For the purpose of the calculation the growth over each 5 year period for both Residential development and Industrial/Commercial/Institutional (ICI) development has been spread evenly over the 5 year period. HRWC has converted the ICI sources to equivalent flows and then converted those flows to a per person basis. The residential growth over the next 30 years is 137,900 and equivalent ICI is 63,300 for a total of 201,200 persons (See Appendix A, Table 1 Projected Populations).
3.0 Projected Infrastructure Costs

The Regional Wastewater Functional Plan (RWWFP) in conjunction with the IRP developed an optimal infrastructure plan for the 30 year growth requirements. The infrastructure plan is comprised of a number of transmission and trunk mains, pump station and treatment plant upgrades across multiple water/sewersheds to provide a regional solution. The Integrated Resource Plan provided the framework for the growth related infrastructure costs for Regional Infrastructure. Through the studies and evaluation of infrastructure, it was determined that there are no Regional stormwater components. Refer to Table 1 Annual Infrastructure Costs in Appendix B for the costs for Wastewater and Water.
4.0 Calculation of the Charge

A financial model was developed to arrive at a cost, based on having a zero balance at the end of 30 years. The model assumes HRWC will earn 1% on invested funds when the fund is in a surplus position while it assumes HRWC will pay 6% in interest on short term loans when the account in a deficit position. It is recognized that actual capital spending and development will differ from that assumed in the model but the periodic RDC revision will factor in these changes. The tables below summarize the annual wastewater and water infrastructure costs, projected revenue and net financing costs.
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Table 1 - Wastewater Average Projected Total Population Increase in the Year from ICI & Residential Year Sources 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 6,384 6,384 6,384 6,816 6,816 6,816 6,816 6,816 6,135 6,135 6,135 6,135 6,135 8,208 8,208 8,208 8,208 8,208
Total Regional Development Capital Spending in the Year $27,570,000 $6,821,000 $97,500 $15,627,494 $0 $750,000 $41,807,975 $1,222,500 $170,216,963 $0 $750,000 $18,378,065 $22,500 $71,184,508 $0 $750,000 $0 $22,500
RDC fund Contribution from Projected Development 19,273,296 19,273,296 19,273,296 20,577,504 20,577,504 20,577,504 20,577,504 20,577,504 18,521,565 18,521,565 18,521,565 18,521,565 18,521,565 24,779,952 24,779,952 24,779,952 24,779,952 24,779,952
RDC Fund Balance (cap spend less funds available) -8,297,931 4,153,137 23,327,706 28,276,406 48,852,600 68,678,793 47,447,012 66,800,706 -84,895,872 -66,375,486 -48,605,101 -48,462,780 -29,964,894 -76,371,028 -51,592,654 -27,564,280 -2,785,906 21,969,968
Interest cost of Borrowing if RDC Fund is Negative (6%) -248,938 -228,172
Interest earned if RDC is positive (1%)
137,404 258,021 385,645 587,657 580,629 571,239 -2,212,873 -4,538,141 -3,449,418 -2,912,036 -2,352,830 -3,190,078 -3,838,910 -2,374,708 -840,858 26,273
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Year 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042
Average Projected Total Population Increase in the Year from ICI & Residential Sources 6,442 6,442 6,442 6,442 6,442 6,442 6,442 6,227 6,227 6,227 6,227 6,227
Total Regional Development Capital Spending in the Year $165,219,605 $0 $750,000 $0 $22,500 $17,001,644 $0 $750,000 $16,000,000 $22,500 $22,500 $0 $555,009,753
RDC fund Contribution from Projected Development 19,448,398 19,448,398 19,448,398 19,448,398 19,448,398 19,448,398 19,448,398 18,800,521 18,800,521 18,800,521 18,800,521 18,800,521 $607,317,707
RDC Fund Balance (cap spend less funds available) -123,802,477 -104,355,318 -85,658,158 -66,210,999 -46,786,339 -44,340,823 -24,893,664 -6,844,340 -4,045,017 14,731,807 33,508,630 52,307,954
Interest cost of Borrowing if RDC Fund is Negative (6%) -3,604,224 -6,844,734 -5,700,404 -4,556,075 -3,389,920 -2,733,815 -1,454,693 -781,032 -225,555 -47,691
241,202 429,083
Total 201,178
-55,525,106 3,217,152 Net Financing Costs 52,307,954 Projected Surplus at end of 30 years $ 0
The resulting per person charge for wastewater is $ 3,019.
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Table 2 - Water
Average Projected Total Population Increase in the Year from ICI & Residential Sources 6,384 6,384 6,384 6,816 6,816 6,816 6,816 6,816 6,135 6,135 6,135 6,135 6,135 8,208 8,208 8,208 8,208 8,208
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Total Regional Development Capital Spending in the Year $57,000 $22,000 $52,000 $52,000 $8,303,702 $750,000 $0 $30,000 $30,000 $3,465,108 $750,000 $0 $30,000 $30,000 $3,481,160 $750,000 $0 $30,000
RDC fund Contribution from Projected Development 851,873 851,873 851,873 909,518 909,518 909,518 909,518 909,518 818,647 818,647 818,647 818,647 818,647 1,095,265 1,095,265 1,095,265 1,095,265 1,095,265
RDC Fund Balance (cap spend less funds available) 794,873 1,624,746 2,424,618 3,282,137 -4,112,047 -3,952,528 -3,043,010 -2,163,492 -1,374,845 -4,021,306 -3,952,660 -3,134,013 -2,345,367 -1,280,102 -3,665,997 -3,320,732 -2,225,467 -1,160,202
Interest cost of Borrowing if RDC Fund is Negative (6%)
Interest earned if RDC is positive (1%) 3,974 12,098 20,247 28,534
-106,951 -241,937 -209,866 -156,195 -106,150 -161,885 -239,219 -212,600 -164,381 -108,764 -148,383 -209,602 -166,386 -101,570
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Year 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042
Average Projected Total Population Increase in the Year from ICI & Residential Sources 6,442 6,442 6,442 6,442 6,442 6,442 6,442 6,227 6,227 6,227 6,227 6,227 201,178
Total Regional Development Capital Spending in the Year $30,000 $1,123,889 $750,000 $0 $30,000 $30,000 $3,815,470 $750,000 $0 $30,000 $30,000 $0 $24,422,329
RDC fund Contribution from Projected Development 859,612 859,612 859,612 859,612 859,612 859,612 859,612 830,976 830,976 830,976 830,976 830,976 $26,844,934
RDC Fund Balance (cap spend less funds available) -330,590 -594,867 -485,255 374,358 1,203,970 2,033,582 -922,276 -841,299 -10,323 790,653 1,591,629 2,422,606
Interest cost of Borrowing if RDC Fund is Negative (6%) -44,724 -27,764 -32,404 -12,686
7,892 16,188 -17,500 -52,907 -25,549 3,902 11,911 20,071 -2,547,422
Total
124,817 Net Financing Cost -2,422,606
Projected Surplus at end of 30 years $0

NOTE: Interest payments are all based on opening balance and 1/2 of current year The resulting per person charge for water is $ 133. Similar calculations were carried out for a 20 year time frame and a 10 year time frame. The summary of projected Regional Development Charges for each of the different time frames is presented below:
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Wastewater Charge Water Charge Total
30 year Rate per Person $ 3,019 $ 133 $ 3,152
It is proposed to present to the NSUARB a charge based on a 30 year time horizon. Assuming the average household is 2.4 persons, the rate per unit is noted in Table 3. Table 3 RDC Per Dwelling Unit 30 year Rate per Unit $7245.60 $321.60 TOTAL $ 7567.20
*The capital costs for water require adjustment for declining consumption.
Wastewater Charge Water Charge *
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Appendix A Projected Populations

Table 1
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042
Average Projected Average Projected Residental Population Population Increase Increase in the Year from in the Year from ICI HRM Information Sources 4,238 2,146 4,238 2,146 4,238 2,146 4,670 2,146 4,670 2,146 4,670 2,146 4,670 2,146 4,670 2,146 3,989 2,146 3,989 2,146 3,989 2,146 3,989 2,146 3,989 2,146 6,062 2,146 6,062 2,146 6,062 2,146 6,062 2,146 6,062 2,146 4,296 2,146 4,296 2,146 4,296 2,146 4,296 2,146 4,296 2,146 4,296 2,146 4,296 2,146 4,296 1,931 4,296 1,931 4,296 1,931 4,296 1,931 4,296 1,931 137,871 63,307
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Average Projected Total Population Increase in the Year from ICI/Residental Sources 6,384 6,384 6,384 6,816 6,816 6,816 6,816 6,816 6,135 6,135 6,135 6,135 6,135 8,208 8,208 8,208 8,208 8,208 6,442 6,442 6,442 6,442 6,442 6,442 6,442 6,227 6,227 6,227 6,227 6,227 201,178
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Appendix B Annual Infrastructure Costs

Table 1 Year
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Total
Wastewater
$27,570,000 $6,821,000 $97,500 $15,627,494 $0 $750,000 $41,807,975 $1,222,500 $170,216,963 $0 $750,000 $18,378,065 $22,500 $71,184,508 $0 $750,000 $0 $22,500 $165,219,605 $0 $750,000 $0 $22,500 $17,001,644 $0 $750,000 $16,000,000 $22,500 $22,500 $0 $555,009,753
Water
$57,000 $22,000 $52,000 $52,000 $8,303,702 $750,000 $0 $30,000 $30,000 $3,465,108 $750,000 $0 $30,000 $30,000 $3,481,160 $750,000 $0 $30,000 $30,000 $1,123,889 $750,000 $0 $30,000 $30,000 $3,815,470 $750,000 $0 $30,000 $30,000 $0 $24,422,329
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A-6 Presentation for Stakeholder Meeting No. 2
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APPENDIX A-6
Agenda
Welcome & Introduction Overview of Stakeholder Meeting No 1 Estimated Population
Regional Development Charge Policy
Stakeholder Conference #2 November 15th, 2012
Infrastructure Costs BREAK Calculation of the Charge Mechanics of Implementing the Charge Open Discussion Next steps
Events Leading to Regional Development Charge
Overview
Existing Regional Development Charges 2010 Rate application to the Nova Scotia Utility and Review Board (NSUARB) to replace the existing charges NSUARB 2011 orders:
Integrated Resource Plan (IRP) Cost of Service Study (COSS (including RDC)) Debt Study Consultation for the Availability/Development Charge
New Concept for Development Charges
www.halifaxwater.ca
www.halifaxwater.ca

Local Infrastructure
Infrastructure required to directly service (both on-site & offsite) the developing properties
COMPLIANCE
GROWTH
Area Master Infrastructure

Oversized or enabling infrastructure required to directly support designated master planning areas & specific development (both inside & outside the master plan area)
ASSET RENEWAL
Regional Infrastructure
Infrastructure required to provide core treatment, water transmission, trunk sewer collection services & their associated appurtenances
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Recommend Regional Development Charge (RDC)
Existing charges are out dated Existing charges only apply to wastewater Availability Charge based on equity not on cost of providing capacity for future growth RDC matches future investment with growth and allows the charge to match the cost of servicing for growth Method of calculation is understandable and can be applied to water, wastewater and stormwater
Projected Populations
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www.halifaxwater.ca
Projected Populations
30 Growth Horizon Growth Centres HRM Regional Plan Known Large Scale Developments Overall Equivalent Population: 201,178 people Updates on 5 year intervals
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Origin of Infrastructure Costs
IRP process defines long term regional growth related costs
Infrastructure Costs
Capital costs are projected over the planning horizon and identified by project and year of expenditure in the IRP Wastewater: Developed from the Regional Wastewater
Functional Plan
Water: System modeling within IRP Stormwater: No Regional Infrastructure identified
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Key Assumptions
Outcomes of RWWFP adjusted to reflect Declining Consumption (1.5%/year for 15 years)
Wastewater Servicing Option Development
Concepts
Strategies
Siting/Alignments
CCME Strategy: No increase in Combined Sewer Overflows as a result of Development without an approved management plan Outcomes of IRP water modeling to be adjusted to reflect Declining Consumption (1.5%/year for 15 years)
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Sample: Evaluations Outcome

For Example for the Halifax Sewershed, Nine (9) servicing concepts were identified and evaluated Concept 1 Convey and expand HWWTF Concept 2 Convey, store, and expand HWWTF Concept 3 Storage and conveyance Concept 4 Satellite treatment Concept 5 In-line storage Concept 6 New WWTF Concept 7 Divert to Herring Cove WWTF Concept 8 Sewer separation Concept 9 Inflow and infiltration reduction CARRIED FORWARD SCREENED OUT CARRIED FORWARD SCREENED OUT SCREENED OUT SCREENED OUT CARRIED FORWARD SCREENED OUT CARRIED FORWARD
Evaluation Criteria
Environmental Impact Technical Impact Socio/Cultural Impact Financial Impact Legal/Jurisdictional Impact
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Overall Infrastructure Costs

Wastewater: $ 555,000,000 Water: $ 24,000,000 These costs are inclusive of base infrastructure costs and directly related costs:
Engineering/Design Professional fees Construction Management & Administration Contingency Net HST & Bridge Financing
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Questions/Comments BREAK
Calculation of the Charge
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Proposed RDC Calculation Method
Proposed RDC: Wastewater
Total Regional Infrastructure Cost (over 30 years) RDC(max) = Total Projected Growth (population equivalents)
RDC will be calculated such that it will result in a zero balance in the RDC Reserve Fund at the end of the planning horizon Updated on a 5 year cycle (maximum) SUBJECT to HRWC Board & NSUARB approval
Cost + Financing(over 30 years) RDC(max) = Total Projected Growth (population equivalents)
$ 607,317,707 RDC(max) = 201,178
(over 30 years)
(population equivalents)
RDC(max) =
www.halifaxwater.ca 21 www.halifaxwater.ca
$3,019/person
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Proposed RDC: Water
Projected RDC per unit
Cost + Financing (over 30 years) RDC(max) = Total Projected Growth (population equivalents)
Wastewater = $ 7,250/unit Water = $320/unit Total = $ 7,570/unit
26,844,934(over 30 years) RDC(max) = 201,178

(population equivalents)
(based on 2.4 people per unit)
RDC(max) =
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$ 133/person
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Captures the development of all newly created lots Captures redevelopment of existing lots or buildings
Mechanics of Regional Development Charge
Applicable on a dwelling unit basis

No Charge on non-serviced space (i.e. detached garage)
Net Increase in Density

Net increase in existing Equivalent Population No charge on an addition to an existing Dwelling Unit
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Next Steps
Stakeholder feedback (written feedback is encouraged) before and after the submission to NSUARB Issue revised Discussion Papers, Meeting Summaries & Question Responses
Next Steps
Stakeholder Conference #3 (scheduled for December 3, 2012) Submission to Halifax Water Board (mid December 2012) Submission to NSUARB (January 2013) Interveners submissions to NSUARB (Jan-April 2013) Formal NSUARB Rate Hearing (April 2013)
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Contact Information
Kenda MacKenzie, P.Eng. Halifax Water Open Discussion

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APPENDIX A-7
Halifax Water Regional Development Charge Policy Stakeholder Session #2 November 15, 2012 Canada Games Centre ATTENDEES: Andrew Giles Austin French Blaine Rooney Ben Young Chris Marchand Chris Millier Cathie OToole Cesar Saleh Dale Noseworthy Eric Burchell Earle Richardson Gerry Isenor James Campbell Joseph Daniel Jamie Hannam Jim Spurr John Salah Kenda MacKenzie Kathleen ODonovan Mark Gilbert Mike Hanusiak M. Sooriyakumaran Mark VanZeumeren Nola Button Paul Morgan Paul Pettipas Peter Polley Robert MacPherson Richard MacLellan Rohit Seth Stefan Furey Tamara Watson Valerie Williams (AG) (AJ) (BR) (BY) (CMAR) (CM) (COT) (CS) (DN) (EB) (ER) (GI) (JC) (JD) (JH) (JSP) (JS) (KMAC) (KOD) (MG) (MH) (MS) (MV) (NB) (PM) (PPE) (PP) (RMAC) (RM) (RS) (SF) (TW) (VW) Brunello HRM HRWC Consultant Ramar Ramar Developments ARMCO Halifax Water W.F. Fares Group Killam Properties Southwest Properties Clayton Developments HRWC Consultant Halifax Water Cresco/UDI Halifax Water Halifax Water Quadra Engineering Halifax Water Centennial Dalhousie University Clayton Developments Annapolis Group Stevens Group Halifax Water HRM NSHBA Polycorp/IPOANS ARMCO HRM Heritage Gas NSE Whitestone Developments Halifax Water
Page 1 of 4
Jamie Hannam welcomed attendees to the 2nd Stakeholder engagement process for Halifax Waters Regional Development Charges. Jamie reviewed the previous information presented at the first meeting. The focus for this meeting is the initial calculation at the RDC and the associated math behind the calculation. The RDC number will be presented and we will open the floor for discussion and input.
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Halifax Water Regional Development Charge Policy Stakeholder Session #2 November 15, 2012 Canada Games Centre
Page 2 of 4
Ultimately, Halifax Water will need to take the RDC calculation forward to the Halifax Water Board and the NSUARB in the new year. Presentation reviewed the existing regional development charges for wastewater infrastructure Sewer Redevelopment Charge (SRC) and the Regional Wastewater CCC. Both were implemented by HRM and Halifax Water inherited those in our new rules and regulations. These charges are collected today to help fund Regional infrastructure. In 2010, there was a rate application to the NSUARB that included a revision to the existing development charges. The approach presented was not accepted by the NSUARB and Halifax Water was directed to review what industry does from a best practice perspective and to engage stakeholders in the review process. In 2011, the NSUARB also directed Halifax Water to complete an Integrated Resource Plan (IRP) a 30-year capital investment plan that was recently completed and is with the NSUARB for approval. The IRP is available on the Halifax Water website for public viewing. The IRP was used to develop the initial RDC calculation. The Cost of Service Study recently completed is used to describe how Halifax Water allocates costs across various customers. We are also completing our Debt Study to outline how much debt is appropriate for Halifax Water to carry. Halifax Water needs infrastructure for 3 main reasons: 1. Asset Renewal replacing of all assets we currently own 2. New and emerging regulatory compliance issues coming from Federal & Provincial governments that require improvements to our current infrastructures, and; 3. Growth to support infrastructure for planned communities. Infrastructure for the three drivers is laid out in the IRP. However, for the purposes of developing the RDC, the growth component was used. Asset Renewal component is fully rate based, the compliance issues are fully rate based. Growth to support development following cost causation principles is the responsibility of the development community. The group was reminded of the three categories of infrastructure as outlined in Discussion Paper No. 1 in section 3.2. Local Infrastructure that is required to directly service (on-site or off-site) developing properties. The cost for local infrastructure will be a direct cost to the developer. Area Master Oversized or enabling infrastructure that is required to directly support the designated master planning areas and the specific development (both inside and outside the master plan area) and that is not considered Regional in nature. The cost for area master infrastructure is direct to the developer and may be shared across a number of benefitting developments. Area master infrastructure may be facilitated through Halifax Waters capital cost contribution charge process.
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Page 3 of 4
Regional Infrastructure that is required to provide core treatment, water transmission, trunk sewer collection services and their associated appurtenances. This infrastructure provides benefit to the larger serviced community and extends across master plan areas. Regional infrastructure will be planned and constructed by Halifax Water. The proposed RDC would be used to fund regional infrastructure projects.
The regional infrastructure component is very difficult for any individual developer to have to pay for at the time. Halifax Water will be responsible for planning and constructing the regional infrastructure required for Water/Wastewater/Stormwater. The discussion today is about how Halifax Water will recover those costs from the development community so that we can provide infrastructure necessary to support the planned development. Through our review of the existing charges and the proposed infrastructure needs based on HRMs planning projections, Halifax Water realized that the existing charges are outdated both from the mechanism used to collect them and the dollar values that are collected dont match our infrastructure requirements. The existing charges only apply to wastewater. Halifax Water needs to revisit the requirements for water infrastructure. And the focus for the charge needs to be on a more direct cost causation principle. The new RDC will need to match Halifax Waters future investment in infrastructure with the cost of providing it with the linkage back to the development community. The RDC calculation used: 30 year population protections from HRMs regional planning efforts and the IRP as a source of the infrastructure required to support that growth for that population. Cost of infrastructure divided by the population growth
The regional plan has a growth horizon up to 2026 however; the IRP used a 30 year growth horizon. HRM regional planning staff identified the large scale development areas anticipated in the regional plan (including densification of the peninsula of Halifax and downtown Dartmouth). The overall equivalent population is approximately 201,000 (residential plus ICI). The population projections will be updated in 5-year intervals that will coincide with the update of the Regional Planning with HRM. A key factor in developing the wastewater plan is the federal regulations that suggested there should be no increase in combined sewer overflows as a result of development without an approved management plan. That meant we had to do the analysis to figure out what infrastructure is needed for our system to maintain the existing levels of overflows (i.e. not make them worse) as a result of growth. The resulting plan outlined a number of upgrades to pump stations, treatment plants, installation of storage tanks in sewersheds, diversion from one sewershed to another. A copy of the preferred servicing plan was shared with the group.
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Page 4 of 4
The charge calculation was presented (construction costs + financing costs over 30 years divided by population). Wastewater - $3,019 per person; water: $133 per person; total per person is $3,152. Using 2.4 people per unit, this equates to approximately $7,565 +/- per unit. Kenda gave a short explanation of the proposed method to implement the charge. If it is collected at the building permit stage, it would capture the development on newly created lots and also redevelopment on existing lots.
Next Steps: Gather stakeholder feedback Halifax Water welcomes formal feedback on the comment form provided or through email to Kenda MacKenzie at mackenk@halifaxwater.ca. Stakeholder Meeting No. 3 Halifax Water will tentatively schedule Stakeholder Conference #3 for early to midDecember 2012 date and agenda to be confirmed. Submission to NSUARB Halifax Water is required to make a submission to the NSUARB in January 2013 in preparation for an April 2013 hearing. The RDC policy forms part of the January submission. We will need to submit first to the Halifax Water Board by mid-December. The submission to the NSUARB will be the formal point in the process for anybody who wishes to intervene in front of the NSUARB and make their arguments for or against the Halifax Water submission. Communication to Stakeholders Halifax Water will meet internally to review what additional modeling work can be incorporated given the time line. A formal communication to the stakeholder group will be issued via email regarding the timing of the next meeting.
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Glossary of Acronyms ADF AWWA CCC CCME COSS CSO ERA HHSP HRM HRWC HW HWB ICI I/I IRP LOS LIC Average daily flow American Water Works Association Capital cost contribution Canadian Council of Ministers of the Environment Cost of service study Combined sewer overflow Environmental risk assessment Halifax Harbour Solutions Plants Halifax Regional Municipality Halifax Regional Water Commission Halifax Water Halifax Water Board Industrial/commercial/institutional Inflow and infiltration Integrated Resource Plan Levels of service Local improvement charge NSE NSP NSUARB O&M PPE RDC RWWFP SRC SSO SW TSC WEF WSER WSP WW WW CCC WWTF
APPENDIX A-8
Nova Scotia Environment Nova Scotia Power Nova Scotia Utility and Review Board Operations and maintenance Per person equivalent Regional Development Charge Regional Wastewater Functional Plan Sewer Redevelopment Charge Sanitary sewer overflow Stormwater Trunk Sewer Charge Water Environment Federation Wastewater systems effluent regulations Water supply plant Wastewater Wastewater Capital Cost Contribution Wastewater treatment facility
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item Comment or Question # At the Stakeholder Meeting 1 Are you saying in 30 years our population is going to grow by 201,000 people? 2 Do we know what it has grown in the last 30 years? 3 Response /Explanation
It is the equivalency. It is not all people; some of it is ICI and industrial equivalent. 140,000 residential and approximately 60,000 of ICI mix. Recent growth trends show a consistent 1% per year growth rate (per HRM planning department). So you are saying that you assumed a consumption Yes, we have applied a reduction in consumption rate of 1.5% for 15 years after which the reduction of 1.5% per year for 15 years; and what consumption level is assumed to level off. There are a range of factors that may influence did you do after that? the actual rate of consumption reduction. As more information is learned through actual conservation programs and annual consumption rates, this trend may be adjusted for future calculations. Which of the growth areas represent those that Halifax Water looked at land that is not developed, regardless of the point in the have already been approved and which ones are on development process (i.e. whether its at building permit stage or development agreement the books as potential future but have not been stage). It is based on land that does not have any services on it as of today. approved yet? So are you going to have to go to the URB again and The IRP was the long term study. It is completed and filed with the NSUARB. The IRP are you also going to do a long term study? document explains all three drivers of the 30 year infrastructure needs. Todays focus is to discuss the growth side. The other two components (asset renewal and compliance) will have a long term impact on the rates. Halifax Water will be making a rate application in January 2013 to begin this process of putting the appropriate rates in place for the utility. The RDC will be used to fund the growth component of the infrastructure needs. The people moving to the new areas paying for this The current methodology is that the customers in the same class will all get the same rate infrastructure are going to have all new pipes. Are (postage stamp rates). they still going to pay the same rate as the people who have the old infrastructure which is going to need to be repaired? Where is the comparison of what people are paying Halifax Water is collecting around $1,500 per unit from the existing regional charges now and wouldnt it be easier for us to discuss this if (wastewater CCC and the SRC) versus the $7,500 per unit recommended. We are presenting we knew what you are getting from the developer the math associated with the funding needs and the proposed charge going forward. We now? Do you have that figure? know that locally, our current collection is NOT funding the infrastructure that we are building today. Nor will it be able to fund the infrastructure needed in the future. Does your cost include any federal funding at all? We have assumed there will be no federal or provincial infrastructure funding for these projects. Page 2 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # 9 10 Comment or Question Are you proposing to balance the charge by using a combination of a charge upfront or funding it over time through rates? The fundamental problem I have in the whole thing in the big picture is that you are asking us to pay for the factory up front to see if you can collect the fee later. Response /Explanation
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We must adhere to the principles of cost causation used by the NSUARB. We may have limited opportunities to explore other options for charge calculation and timing of collection. Using the principles of cost causation, the need for the expansions to the regional infrastructure is driven by growth, therefore growth should pay for the expansions. The comment that we are asking for the development community to pay for the works up front to see if we can collect later implies a double fee approach. This is inaccurate. What we are proposing is a charge collected at the time of development to fund the regional infrastructure expansions when the level of growth triggers the need for the expansion. By collecting the charge at the time of development, Halifax Water will be in a more favourable position to implement the infrastructure using development reserves and minimizing the impacts to the utility related to financing. Before we get too far, I want to point out that the We understand this change has impacts to the industry and that is why we are seeking your approximately $7,500 per unit charge is not the total formal feedback. We are not here to say this is the information, go away and accept it. number that will go to the home owner. You can We have been asked by our regulator to carry out the analysis, meet with stakeholders to take that number and multiply it by at least 1.5 to present the math and seek input from the stakeholder community. We are hearing some account for mark ups by the developer. Then its concerns regarding the impacts to the industry and the stakeholders have voiced some ideas going to the homebuilder who will mark it up. So the for alternate methods of paying for the charge. Ultimately, the decision will be made by the final number to the home owner is going to be NSUARB and Halifax Water is presenting the infrastructure needs, assumptions, costs and a massive + tax. This is a big problem for the preferred RDC to cover the cost of providing growth related regional infrastructure. development industry. Who is really going to benefit from these costs? And Halifax Water is doing a debt study right now with a 30-year financial model showing a is there an ability to spread out these costs? range of different options on how we can pay for the full Integrated Resource Plan. We have 12 different financing models now and what has been presented today is the theoretical math for the regional development charge. In the 12 financing models under review, we are looking at differences in financing from a variety of sources at different levels and the issue you have raised is how do we balance off inter-generational equity against pure cost causation and thats really why we are here. We are looking for direction and feedback on how we can move forward from today and try to balance the cost causation and the intergenerational equity principles. What we are showing you today is related to the worst case scenario regarding magnitude of proposed RDC. What is going to be submitted is going to be based on the debt study models that will show a range of possible RDC levels and represents the most efficient and equitable finance mechanism that we can use. Page 3 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # 13 14 Comment or Question What is the population in HRM now within the service boundary? I think your flow rates are too high compared to what we are actually doing in construction. We are building with 100 litres per person per day vs. 300. There is a big disconnect between the volume that is being done now as compared to building practices. So I am looking at this and saying you are going to spend $7,000 per unit plus taxes to basically buy capacity in the system for the next 200,000 people. The builders in the room would be better off to find a program today to change everybodys toilet in the city because we may be buying the same capacity. You are completely forgetting about the fact that as the price of water keeps going up (10-15% here), water consumption is not going to go down by only 1.5% a year. It is going to go down by 3-4%. So have you modeled what happens if water consumption declines at a higher rate (e.g. 4% per year)? Response /Explanation Our estimated equivalent population served is just over 350,000. Typical consumption values continue to be around the 310 litres per person per day despite efforts the building industry is attempting to introduce. That means while you are planning for consumption in your buildings of approximately 100 litres per person per day, the actual water production rates we are seeing are averaging significantly more than that. However, it is possible and in fact, probable that consumption will decrease more over time as our ratepayers become more knowledgeable about water needs and consumption and they change their water use behaviours. Presently, our trend information demonstrates that Halifax Water has seen a net reduction in consumption of approximately 1.5% per year for the past 10 years. We have included an assumption that consumption will continue to decline by 1.5% per year for the next 15 years, then level out at a constant rate. We have not done sensitivity analysis on greater levels of declining consumption as the 10 year trend supports the 1.5% reduction assumption. There is one other component that we must make sure is accounted for when we do our calculation for wastewater flows. That is the portion of the calculation formula that provides an allowance for inflow and infiltration in the system (even for new construction). That component does not have a declining consumption piece. We must plan for this as part of the natural degradation of the asset over time this piece is very real.
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With each update, Halifax Water will monitor the actual flows observed and account for the impact to the Regional Infrastructure Master plan When will this charge come into effect? The effective date for the charge will be determined by the NSUARB. Charges collected will go into a reserve fund to be used to build the infrastructure as its required. Based on the master planning done recently, there are regional infrastructure projects that need to get started right away. And just to reiterate, the RDC does not fund local or area master infrastructure only regional level infrastructure. In terms of affordability why cant the approach That option can be explored. However, it does not meet the true cost causation principles allow for a certain amount of the charge to be paid and would be subject to discussion with the NSUARB. at development/building permit stage and a portion Page 4 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # Comment or Question of it be applied to the rate so the consumer pays for part of the capital requirement over the 30-year period? The growth projection of a population increase of 200,000 is based on January 1, 2013 and the $600M is to service that growth. So how does the current capacity of the system come into play in all that? At the end of 30 years, the assumption is that there will be zero capacity left in the system. Response /Explanation
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First, the growth projections were done based on numbers provided in August of 2011. Projections were provided in 5 year increments across the known growth areas. The system analysis was done first to review capacity limitations in the existing system (baseline), prior to applying the growth projections. Under the baseline conditions, Halifax Water was able to identify areas at or approaching system capacity. When we apply the growth projections, we determine what additional regional infrastructure is needed to enable the growth. This represents the $600M program. While effectively there may be some small pockets of existing capacity, it has already been paid for by previous development. In theory, the system is modeled such that at the end of the 30 year period, there will be zero capacity left in the system but the full population projected would be supplied. An outside consultant that was working with Halifax Water. We went through the three different methods to see what was most appropriate.
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You have a little chart (refer to slide 26 of Stakeholder Meeting No. 1 presentation or Discussion Paper No. 1, Exhibit 5-4) that shows you checked the three options and you scored each. Who put these numbers down was this Halifax Water or was it an outside consultant? You show conservation as a principle and for each option it is scored with a one (refer to slide 26 of Stakeholder Meeting No. 1 presentation or Discussion Paper No. 1, Exhibit 5-4). As Halifax Water raises the price of water, conservation is going to basically sky rocket as it has done when you have higher electricity, higher fuel bills. So for the two new options (Availability Charge, Proposed RDC) why would there be a consistent one? It seems that what you are saying here is that conservation is not going to come into play through any of what you are going to do? Does that make sense if you raise the price of something, wouldnt people try to reduce
There is certainly an opportunity to reduce consumption through both fixtures (low flow toilets/showers, appliances) and behaviour. However, there will eventually be a threshold for how far the consumption can be reduced. Initially a rate increase may result in some reduction in consumption but this is expected to rebound somewhat. Likely, continued efforts on the part of ratepayers will result in further consumption reductions. Note that we are talking about the RDC in these meetings not the water and wastewater user rates. And to reiterate, at our last rate application we reviewed an analysis of 10 years of data showing the historical average was 1.5% decline in meter water consumption. We also looked at the years when there were rate increases and the consumption decline is stable. Meaning, the rate increase doesnt have a big impact on consumption and I think its because we dont have rates that are high enough yet to affect behaviour. In fact, we have some of the lowest water rates in the country right now. The affordability benchmark for Page 5 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # Comment or Question their usage (e.g. low flow toilets/showers, etc.)? 20 Right now the costs, fees, charges and taxes on a new home in Metro is basically 20%. On a $300,000 home that would be $60,000. You are going to add another major fee onto that and bring it up in the range of probably 22 23%. These are upfront costs. You are proposing to collect a tremendous amount of money for some works that are going to happen way down the road. So the person that is trying to buy that home today is getting hit harder than the person buying further down the road. Will you remodel this for us re-run the model using a 50 or 60 year horizon (instead of 30 years), using a different discount factor (i.e. not reasonable to discount down to zero), using a funding factor, and including assumptions for Federal/provincial funding? Then take of the cost and put it on the rate and the other put it up front. Response /Explanation rate affordability right now is 4% of household income. Halifax Water rates represent 0.8% of limited household income. Compared to 15 cities across Canada that are of similar size, Halifax has the lowest rates. We would appreciate if you could fully articulate your concerns in writing on behalf of your industry. In terms of buyers today paying for works tomorrow, the funds at development would go into a reserve fund. It would be used to pay for regional infrastructure at a point in the future when the timing is triggered. However, throughout the planning horizon, any new unit would be subject to the RDC for regional infrastructure. And with the proposed 5 year cycle of review for the RDC, the planning horizon will be extended the next 5 years to capture both growth and infrastructure needs to meet projected growth. Therefore, new units later in the process are not deriving a benefit over units constructed today. We need to receive this input in writing so we can assess what is being requested and understand whether these are realistic opportunities for remodeling (possibly the ones youve just mentioned but possibly others as well). The modeling exercise is very complicated so we want to optimize the number of iterations. We need to do a little bit of triage to confirm which altered assumptions are really good candidates and will yield meaningful results. We dont want to model something just for the sake of showing that we did when we are not going to agree with the assumptions it is based on. A host of these we can agree are candidates and we could build on a couple of model variations to show sensitivities to that.
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We are very sensitive to the affordability issue. But we are at the point where are trying to work within the utility model and the NSUARB gives us a certain rule set to work with. So some of these issues are more appropriately decided by the NSUARB. What I would like to do is, work out as many of the issues between us and the stakeholder group early so that when we present the information to the NSUARB, we have closed at least some of the gaps. Want to know what % is actually driven by more Most of this cost is from capacity increase of the regional infrastructure. It doesnt include people and what % is the need to expand out to the collection sewers out through the main subdivisions (local and area master different areas. infrastructure). But your point is well taken. So say for a typical multi-residential unit, is this For multi-residential it would be on a per unit basis. A unit is a unit. charge on a per unit or per square foot basis? Page 6 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # 24 25 Comment or Question Response /Explanation
So you are saying someone who is building a 5,000 That is a very good point. That is something we will have to look at. sq. foot house on the Northwest Arm is going to pay the same rate as a guy buying a bachelor apartment? What about a tear down and you change the It would be on net increase. For example, if you have an existing 10 unit multi that you tear property? down and replace with a 20 unit multi, you would be charged on the net unit increase (20 10 = 10 units x charge) for regional infrastructure to accommodate growth. We must remember that we cant increase CSOs as a result of development. So one of the components that were sizing the infrastructure for is to meet that requirement. At the time the existing systems were constructed, we were allowed to continue or increase CSOs. There is not that capacity now. Your question is around looking at an economic model and what happens if we see negative population projections and therefore a drop in building starts and what might that show.
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Has there been a scenario that you plugged in on how much business you are going to lose? If the new RDC pushes the industry to the point where it is not going to work, how will affect your numbers throughout the process?
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We will be meeting with the Greater Halifax Area Partnership to get some feedback on the economic implications (looking at different financial models). Ultimately, it may not be our role at all and we may turn over the data to someone else who has the expertise to do it. Have you looked at adding a rate rider to the We have not but I think thats the theme I am hearing promoted. Make sure we take it down existing customers to pitch in for some of this to the right size (total cost of regional infrastructure), then charge as an upfront charge instead of lumping it on to the new homeowner and and on the rate base. That approach has issues with the utility rate model but we will look saying its their burden for expansion and growth? at it. Our initial look told us that it is not an appropriate charge to put on the rate base because it is solely for development activity. However, we hear your points and we will come back and revisit these principles to the extent permissible before we move on. If we go back to the rate rider idea, the argument In the simplest terms, if there was no growth, we would not need the money to fund the you are going to have from existing customer base is regional infrastructure. And we have approached this issue from the principle that growth why should I be paying for a portion of new should pay for growth. However, through this stakeholder consultation process, there have development? Thats a challenge for the Water been some good arguments to indicate some level of sharing across the rate base. So Commission. We need to remember that the people questions of housing affordability that may influence whether the development occurs in in existing areas didnt pay for the system to begin HRM or outside of HRM must be considered. There is probably an economic model that with. When they bought their homes the rules of says it will be self-defeating to impose this type of charge; if you impose it, you actually engagement were different they didnt have to pay wont get the growth. And therefore, the reduced rate base will have a difficult funding those costs. There is already an inequity. So HW will requirement for the other non-growth capital infrastructure programs (asset renewal, have to strike a balance between how much has to compliance). Page 7 of 10
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # Comment or Question go on the rates and how much is upfront cost. Its a fact that they got a free ride compared to whats going on in todays market. Are you completely committed to January or are you willing to move the date? We do not want to delay this we want to get this done but we are concerned about the time. So April is the sensitivity date? Response /Explanation
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Is there anything that is going in the January submission that would preclude any option of going forth based on our working together for these months for an April RDC submission? 32 Its better to work with us (stakeholders) than have The fact that we are here today discussing this, saying we have a problem (Halifax Water us appear before the NSUARB as we have in the past needs to fund regional infrastructure for growth), you stakeholders are reiterating that you to have this thrown out and delay support. I think have a problem, and collectively, how are we going to work through this this is part of the thats all we are trying to say; the more we can get positive process of stakeholder consultation. We need to engage with the stakeholder agreement on in front of the general public, it will be group but it is unlikely we will have complete agreement on the issue. We are not trying to easier on all of us. With what we have now we are hide this; the math is the math and we also need to find a way forward. going to have to go after you at the hearing. Written Comments Received Outside of the Stakeholder Meeting 33 What is the total population currently served by Halifax Water tracks service provision by the number of customers. At March 31, 2012, sanitary sewer and water (separate numbers for each Halifax Water had 81,422 water customers and 78,287 wastewater customers. if available)? What is the number of households or equivalents served by sanitary sewer treatment facilities? 34 What is the total volume of sewage treated at The IRP provided a summary of the rated capacity of the WWTFs. Table 3.4 in Volume 3 of sewage treatment plants? the IRP gives an Average Daily Flow (ADF) totalling 307,589 m3/d for the WWTFs. Note that this total includes the upgraded capacity of 25,000 m3/d for Eastern Passage and excludes Belmont. Please refer to the IRP Final Report and appendices posted on the Halifax Water website at: http://www.halifax.ca/hrwc/ Page 8 of 10
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We are ordered by the NSUARB to file our rate application no later than January 31, 2013. We can in theory file the rate application & then come along with the RDC afterward but we would have to have filed by the time we get there for the hearing (i.e. April 2013) because at the last decision, the NSUARB asked us to bring forward a revised development charge. Yes, as long as we can file something between the middle of January and April 15 we will be fine. We are making a submission to NSUARB in January for a broad full-rate application for a whole range of issues and regulations. This was just going to be a component of it. We wont delay our NSUARB submission, but the RDC component may have some flexibility. No.
Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Item # 35 36 37 Comment or Question Regarding the population projection used in the presentation at stakeholder meeting 1 was that all of HRM or just the sanitary sewer serviced area? Do you have a breakdown of the capital projects in the 30 year plan so that we can see what is being done and where? I believe that you said that the water analysis did not reflect the declining rate of consumptionso will the figure used for water RDC be decreased significantly by dropping per capita consumption? Has Halifax Water studied the elasticity of demand for water/price to see what the effect of major price increases will do to overall water consumption? Response /Explanation All of HRM. For anyone looking for information on the IRP, please refer to the Halifax Water website at: http://www.halifax.ca/hrwc/ with the documents posted October 31, 2012. Based on the preliminary analysis undertaken on declining wastewater consumption, there was a cost reduction to the program of approximately 7.25% (this of course, is independent of I/I reduction). Using a very crude extrapolation and assuming a similar level of cost reduction would occur for the water program, there would be about a $1.8M reduction ($24.4M - 7.25% = $22.6M) over the 30 year planning horizon (excluding any financing costs therefore this value is still approximate). Undertaking U-8 from the last Halifax Water rate application looked at 10 years of data for consumption (attached). While a full regression analysis has not been done, there does not seem to be a high correlation coefficient for price and demand (yet). There has been a stable decrease in consumption on average 1.5% a year. There has not been markedly higher decrease in consumption in the years when rates were increased. In fact, looking at the current year data, rates increased on June 25th, but our consumption to date decreased 0.14% first quarter (compared to last year) and 0.30% compared to last year in second quarter. 39 Do you have a projection for the estimated water/ sanitary sewage flows for next 30 years by year? Can you confirm that the population multiplier of 2.4 people per unit is blanket rate for any unit regardless of the size (condo unit, townhouse, semidetached, R-1 or apartment)? There are a variety of factors which affect consumption other than price. Effectively, the flow projections were calculated based on the planning projections from HRM. These were then used to generate the model outputs during the RWWFP and IRP projects. Yes we used 2.4 multiplier across the calculation as a "starting point" regardless of the unit type. However, based on some of the feedback from stakeholder meeting no. 1, we are reconsidering that approach.
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Meeting Summary Stakeholder Meeting # 2, November 15, 2012 Halifax Water Regional Development Charge Policy Review Attachment to Question/ Comment 33:
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A-9
Presentation for Stakeholder Meeting No. 3
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APPENDIX A-9
Agenda
Welcome & Introduction Overview of Stakeholder Meeting No 2 & Input Alternatives
Regional Development Charge Policy
Stakeholder Conference #3 December 18th, 2012
Recommended Alternative Next steps
www.halifaxwater.ca
Stakeholder Input to Date
Economic Impact Appropriateness of Assumptions from IRP Alternatives on Mitigating the impact
Overview
www.halifaxwater.ca
www.halifaxwater.ca
Implementation Alternatives
Recommended Alternative - Wastewater

Unit Type SUD/TH MUD ICI Proposed Charge $ 1,470/unit $ 950/unit $ 6.14/m2 (base rate) Notes Based on 185.8 m2 (2000 ft2) dwelling Based on 111.4 m2 (1200 ft2) dwelling Assumes base equivalent to flows from retail/commercial/office (6/L/m2/day). The anticipated flows for each application will be reviewed prior to approval and the base rate will be adjusted to reflect the increase or decrease in flows. Flows provided by applicants designer, and shall be in keeping with ACWGM.
Full Value RDC Revised Charge Allocation Method Phased Implementation Rate Based Implementation New RDC Framework at Current Rates Status Quo with Current Charges
www.halifaxwater.ca
www.halifaxwater.ca
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Recommended Alternative - Water

Unit Type SUD/TH MUD ICI Proposed Charge $ 375/unit $ 255/unit $ 1.57/m2 (base rate) Notes Based on 185.8 m2 (2000 ft2) dwelling Based on 111.4 m2 (1200 ft2) dwelling Assumes base equivalent to flows from retail/commercial/office (6/L/m2/day). The anticipated flows for each application will be reviewed prior to approval and the base rate will be adjusted to reflect the increase or decrease in flows.
Captures the development of all newly created lots Captures redevelopment of existing lots or buildings Applicable on a dwelling unit basis
No Charge on non-serviced space (i.e. detached garage)
Net Increase in Density

Net increase in existing Equivalent Population No charge on an addition to an existing Dwelling Unit
www.halifaxwater.ca
www.halifaxwater.ca
Next Steps
Submission to NSUARB, January 9th, 2013 Stakeholder feedback (written feedback is encouraged) before and after the submission to NSUARB Interveners submissions to NSUARB (Jan-April 2013) Formal NSUARB Rate Hearing (April 2013)
Open Discussion
www.halifaxwater.ca
www.halifaxwater.ca
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Contact Information
Kenda MacKenzie, P.Eng. Halifax Water

www.halifaxwater.ca
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www.halifaxwater.ca
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Halifax Water Regional Development Charge Policy Stakeholder Session #3 December 18, 2012 Cowie Hill Headquarters Multi-Purpose Room
APPENDIX A-10
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ATTENDEES: Blaine Rooney Ben Young Chris Marchand Cathie OToole David Graham Eric Burchell Earle Richardson Gerry Isnor James Campbell Joseph Daniel Jock Fisk Jamie Hannam Jeff Pearce Jim Spurr Kenda MacKenzie Kathleen ODonovan M. Sooriyakumaran Mark VanZeumeren Paul Morgan Paul Pettipas Valerie Williams (BR) (BY) (CMAR) (COT) (DG) (EB) (ER) (GI) (JC) (JD) (JF) (JH) (JP) (JSP) (KMAC) (KOD) (MS) (MV) (PM) (PPE) (VW) HRWC Consultant Ramar Developments Ramar Developments Halifax Water Atlantic Developments Southwest Properties Clayton Developments HRWC Consultant Halifax Water Cresco/UDI Fisk Developments Halifax Water ARMCO Halifax Water Halifax Water Centennial Annapolis Group Stevens Group HRM NSHBA Halifax Water
Jamie Hannam welcomed attendees to the 3rd Stakeholder engagement process for Halifax Waters Regional Development Charges. Jamie reviewed the previous information presented at the second meeting and the summary of the feedback received to date. The proposed initial rates for the Regional Development Charges (RDC) and the framework were presented. The framework approach proposed is to start with a single new RDC for wastewater and water to replace the existing three wastewater charges at a rate approximately equal to the existing charges; then to work through the range of concerns and issues presented by the stakeholders to arrive at a final sustainable rate. Collection of the new RDC will continue to be at the building permit stage. A question and answer session followed (comments/questions and responses are provided in the stakeholder meeting no. 3 summary). Primary issue relates to time provided to the stakeholder community to review and assess the outcomes of the Integrated Resource Plan (IRP) and the ensuing RDC Policy documents and materials.
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Halifax Water Regional Development Charge Policy Stakeholder Session #3 December 18, 2012 Cowie Hill Headquarters Multi-Purpose Room Next Steps:
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1. Halifax Water to confer with Executive Team to confirm the go forward position respecting the January submission to the NSUARB. 2. Halifax Water to provide an update to the stakeholder community by Friday, December 21, 2012 informing of the go forward position relative to the January submission to the NSUARB. 3. Halifax Water will finalize the RDC report for inclusion in the January NSUARB submission package.
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Meeting Summary Stakeholder Meeting # 3, December 18, 2012 Halifax Water Regional Development Charge Policy Review Glossary of Acronyms ADF AWWA CCC CCME COSS CSO ERA HHSP HRM HRWC HW HWB ICI I/I IRP LOS LIC MUD NSE Average daily flow American Water Works Association Capital cost contribution Canadian Council of Ministers of the Environment Cost of service study Combined sewer overflow Environmental risk assessment Halifax Harbour Solutions Plants Halifax Regional Municipality Halifax Regional Water Commission Halifax Water Halifax Water Board Industrial/commercial/institutional Inflow and infiltration Integrated Resource Plan Levels of service Local improvement charge Multi-unit dwelling Nova Scotia Environment NSP NSUARB O&M PPE RDC RWWFP SRC SSO SUD SW TH TSC WEF WSER WSP WW WW CCC WWTF
APPENDIX A-11
Nova Scotia Power Nova Scotia Utility and Review Board Operations and maintenance Per person equivalent Regional Development Charge Regional Wastewater Functional Plan Sewer Redevelopment Charge Sanitary sewer overflow Single unit dwelling Stormwater Townhouse Trunk Sewer Charge Water Environment Federation Wastewater systems effluent regulations Water supply plant Wastewater Wastewater Capital Cost Contribution Wastewater treatment facility
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Meeting Summary Stakeholder Meeting # 3, December 18, 2012 Halifax Water Regional Development Charge Policy Review Item Comment or Question # At the Stakeholder Meeting 1 In terms of reimbursement of development charges, what happens if you pay at building permit stage but do not build will you receive reimbursement? 2 Do R2s fall into the same category as single unit dwelling (SUD) and townhouse (TH)? 3 What is the plan for transitioning based on the approach to go with new RDC at approximately existing charge amounts? Are you going to give the NSUARB a timeline for when you go back to them with the full amount of the RDC? And so when you go back to the NSUARB, will the whole hearing process begin again? With an April hearing looming, is it your expectation today to have stakeholder support for what Halifax Water is proposing and that you will work with us to reach agreement by April? So really Halifax Water is proposing a dual process: 1) framework using the approximate value of todays charges; and, 2) continuing to work with the stakeholder community for an agreeable position on the RDC? We really feel that the development industry is being put in a difficult position & that we are being forced to make an immediate decision that may set a precedent for our industry without sufficient time to review the outcomes of the IRP & RDC. We feel very strongly that HRWC should grant an extension. Why are we just finding out about the RDC value 2 months prior to the rate application being made to the NSUARB? Response /Explanation
Building permits have a two year expiry and it is possible that HRM refunds a portion of the collected charges if the developer does not proceed. We can establish a process whereby a refund is provided upon formal cancellation of a building permit. Yes; after subdivision to four units, considered a multi-unit dwelling (MUD). We need to be consistent with HRMs method for handling building permit applications. SUDs, R2s and THs that are individual units will be treated the same. An MUD by definition has shared entrances and other shared services. Good questions and yes, the NSUARB will likely require a plan to bring back a final number following our continued dialogue with the stakeholders. We cannot pre-suppose the consultative process but there would need to be a fixed target deadline to report back to the NSUARB. Yes; we must go back to the NSUARB for any changes to the rates. Our preference is that we would have stakeholder support going into the January submission, however, we suspect reaching agreement by April will be a challenge. Yes, that is the preferred approach.
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First, we remind the group that Halifax Water was ordered to submit to the NSUARB by January 9, 2013. The current application will not have an impact on the RDC either way; we will not have any issues that are predicated on a position that the rate increase would be lower if you were to introduce a higher rate for development charges. Capital expenditures dont affect the rate until the infrastructure is in service and depreciation starts. There is a good chance that a separate hearing for the RDC will be needed. The IRP needed to be completed first. The IRP was submitted to the Halifax Water Board in September 2012; and to the NSUARB in October 2012. The IRP project involved consultation that the development community & other stakeholders were invited to participate in. Page 2 of 3
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Meeting Summary Stakeholder Meeting # 3, December 18, 2012 Halifax Water Regional Development Charge Policy Review Item # 9 Comment or Question If it is going to cost a lot of money for new development services, why is there also not a charge in existing areas for servicing? Can you go back to the NSUARB for an extension? We are concerned that the development community is bearing all the costs. Older homes (existing customers) did not have to pay a regional charge; it is not fair to place this all on new development. Response /Explanation Halifax Water did consider the comments raised and hence the alternative for a new rate at status quo charge amounts while allowing us the opportunity to fine tune the final value. Also, part of the concern regarding opting for a delay is that the Debt Study must be filed with the January 2013 application. The Debt Study provides the strategy to fund the recommendations of the IRP; it contains 8 different financial models and the RDC is included. We remind the group that the NSUARB follows the cost causation principle; therefore, in simplest terms, growth should pay for growth. The alternatives presented today are provided in response to the concerns raised by the stakeholder group and establish a compromise position while allowing Halifax Water to continue to work with the stakeholders to reach the final value for the RDC. Existing dwellings constructed since the implementation of the SRC, paid a regional charge for collection systems and those constructed since the adoption of the Regional wastewater CCC, have paid a regional charge for wastewater treatment. The argument for moving away from the status quo of today is to assess the longer term impacts of rate increases. What we are hearing, is that you are not saying Halifax Water is wrong just that you feel you have not had enough time to appropriately respond to what we are proposing,
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Alternatives 5 and 6 are essentially the same cost [Alternative 5 new RDC framework at current rates; Alternative 6 status quo with current charges reference slide 5 from presentation 3]. Therefore, why bother changing from the status quo of the existing charges?
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A-12 Draft Rules & Regulations Language
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APPENDIX A-12
Regional Development Charge Policy Review Interim Report Appendix A-12 DRAFT Rules & Regulations Language
December 2012 The existing Schedule A of the Rules and Regulations contains three specific charges that relate to the collection of funds to be utilized by HRWC to provide capacity in regional infrastructure related to customer growth. The three existing charges are: Section (21) Sewer Redevelopment Charge, Section (22) Trunk Sewer Charge, and Section (25) Capital Cost Contribution Charge for Wastewater Treatment Facilities.
The proposed language for inclusion within the Regulations related to these proposed new Regional Development Charges is excerpted as follows: Regional Development Charge for Wastewater Infrastructure 29(1) A regional development charge for Wastewater infrastructure shall be established to ensure the cost impact to the Commission is neutral to the design, construction and financing of capacity expansion to regional wastewater infrastructure related to customer growth. (2) A charge applicable to new buildings that will be connected to the wastewater system, as detailed in the following table, shall be paid to HRM as agent for the Commission prior to the issuance of a building permit. Table 5. Proposed Regional Development Charge for Wastewater Regional Development Charge for Wastewater Infrastructure Single and semi-detached dwelling units Apartment Units Industrial/Commercial / Institutional (see clause 5) $ 1,470.00 / unit $ 950.00 / unit $ 6.14 / m2
(3) For new buildings and building additions that are undertaken as the redevelopment of an existing serviced building, the charge applicable under subsection (2) shall be based on the net increase in residential units and/or square foot of floor space for non-residential construction, as applicable. (4) When an un-serviced lot of land, occupied by a building, existed prior to the coming into force of these Regulations, the charge applicable under subsection (2) shall be payable to the Commission, when the building is connected to the wastewater system. (5) A charge applicable to Industrial/Commercial/Institutional premises will be determined by prorating a base rate for a typical Commercial flow, deemed for the purpose of this Section to be 6L / m2 / day, with the calculated flow submitted for review by the Commission.
Page 1
January 9, 2013
Page 857
December 2012 (6) The base rate set out in Table 5 shall be collected by HRM on behalf of the Commission at the time an application for development approval is submitted, provided that during the review of any such application any additional or reduced charge will be calculated and payable or refunded prior to issuance of a building permit by HRM. (7) Funds collected under the Regional Development Charge for wastewater infrastructure shall be placed in a reserve account and shall be used for providing capacity in regional wastewater infrastructure. (8) For the purpose of this Section, regional wastewater infrastructure means infrastructure that is required to provide wastewater treatment, and wastewater trunk collection directly servicing the treatment facilities. This infrastructure provides benefit to the broader serviced community and may extend across master plan areas.
Regional Development Charge for Water Infrastructure 30(1) A regional development charge for Water infrastructure shall be established to ensure the cost impact to the Commission is neutral to the design, construction and financing of capacity expansion to regional water infrastructure related to customer growth. (2) A charge applicable to new buildings that will be connected to the water system, as detailed in the following table, shall be paid to HRM as agent for the Commission prior to the issuance of a building permit. Table 6. Proposed Regional Development Charge for Water Regional Development Charge for Water Infrastructure Single and semi-detached dwelling units Apartment Units Industrial/Commercial / Institutional (see Clause 5) $375.00 / unit $255.00 / unit $1.57 / m2
(3) For new buildings and building additions that are undertaken as the redevelopment of an existing serviced building, the charge applicable under subsection (2) shall be based on the net increase in residential units and/or square foot of floor space as applicable. (4) When an un-serviced lot of land, occupied by a building, existed prior to the coming into force of these Regulations, the charge applicable under subsection (2) shall be payable to the Commission, when the building is connected to the water system.
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January 9, 2013
Page 858
December 2012 (5) A charge applicable to Industrial/Commercial/Institutional premises will be determined by prorating a base rate for a typical Commercial flow , deemed for the purpose of this Section to be x L / m2/ day [CALCULATION OF x TO BE ESTABLISHED PRIOR TO FINALIZATION OF DOCUMENT), with the calculated flow submitted for review by the Commission. (6) The base rate set out in Table 6 will be collected by HRM on behalf of the Commission at the time an application for development approval is submitted, provided that during the review of any such application any additional or reduced charge will be calculated and payable or refunded prior to issuance of a Building Permit by HRM. (7) Funds collected under the Regional Development Charge for water infrastructure shall be placed in a reserve account and shall be used for providing capacity in regional water infrastructure. (8) For the purpose of this Section, regional water infrastructure means infrastructure that is required to provide water treatment and water transmission directly servicing treatment facilities for the purpose of providing a benefit to the broader serviced community and may extend across master plan areas.
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January 9, 2013
Page 859
Appendix B
Regional Development Charge Policy Interim Report Unit Costs & On-cost Multiplier Tables
B-1 B-2 B-3 RWWFP Capital Program RWWFP Cost Tables (RWWFP Appendix E) IRP Unit Cost Summary
January 9, 2013
Page 860
B-1
RWWFP Capital Program
January 9, 2013
Page 861
Regional Wastewater Functional Plan - Capital Program
Page 1 of 5
APPENDIX B-1
1 2 3 4 5 6 7 10 13 16 17 18 21 22 23
Wastewater Capital Program - Preferred Regional Servicing Strategy (RWWFP - No Declining Consumption)
Region
Capital Plan Area Project Project No. ID
Combined Project Delivery
Implementation Order
Project Description
System
HW Project Type
Project Type
Diameter (mm)
Length (m), Flow (L/s), Volume (m3)
Unit Rate $/m, $/Lps, $/m

3
Base Cost $M (2012)
Other Costs (Crossings etc.) $M (2012) $0.00
Total Cost $M (2012)
Year Req'd
Period Req'd
Growth Areas Serviced
Related IRP Objective
Central
AT1
AT5
Upgrade Aerotech Drive Pumping station to 145 L/s, from 15 L/s (130 L/s upgrade)
Aerotech
WW - Str
WWPS-U
N/A
130
$6,000
$0.78
$1.25
2031
2031-2036
Aerotech
13
Central
AT2
AT4
Upgrade WWTF to service employment growth flows
Aerotech
WW - TF
WWTF-U
N/A
7.65 MLD
N/A
$13.60
$0.00
$21.76
2031
2031-2036
Aerotech
13
Central
AT3
Upgrade sewer conveyance to WWTF, from Aerotech Drive PS to WWTF
Aerotech
WW - CS
WWM
450 mm
1,650
$895
$1.48
$0.00
$2.36
2031
2031-2036
Aerotech
13
Central
AT4
AT2
Re-locate treated effluent discharge location to Soldiers Lake
Aerotech
WW - CS
WWM
450 mm
6,346
$895
$5.68
$5.11
$17.26
2031
2031-2036
Aerotech
13
Central West West West West West West West West West East East East East East East East East East
5 27 28 29 30 31 31 55 57 56 38 39 40 41 42 43 44 45 46
AT5 BL1 BL2 BL3 BL4 BL5 BL6 BL7 BL8 BL9 DA1 DA2 DA3 DA4 DA5 DA6 DA7 DA8 DA9
AT1 BL2 BL1 BL5
4 2 1 4 3
Upgrade Aerotech Drive PS forcemain to 145 L/s, from 15 L/s (130 L/s upgrade) 450 mm WWFM from BLT PS to 125 m south of Governors Lake Dr New BLT PS WWPS at Timberlea Village Pky (Site to be confirmed) WWPS New wastewater pumping station at Church St WWPS (Exact site to be determined) 600 mm WWM from Governor Lake Drive to Church St PS 450 mm WWFM from Church St PS to upstream of Bayers Lake PS 600 mm Hwy 3 WWM from RAMP SSH-4 to Bicentennial Hwy and North West Arm Dr Upgrade Bayers lake PS 450mm WWFM from Bayers Lake PS 600mm WWM to Bayers lake PS Gravity sewer from Little Albro Lake to Jamieson St PS 450mm surface water sewer from Fenwick St to Old Ferry Rd PS with the addition of Maynard St Sewer twinning along existing roads - Albro Lake/Slayter St to Ferry St PS Storage at Shannon Park vicinity Storage at Anderson Lake vicinity Upgrade of Ferry Rd PS by 807 L/s to provide total capacity of 900 L/s (existing PS has 93 L/s) 825mm Ferry Rd forcemain for 900l/s Upgrade of Dartmouth WWTF I/I Reduction Program
Aerotech BLT BLT BLT BLT BLT BLT BLT BLT BLT Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth
WW - FM WW - FM WW - Str WW - Str WW - CS WW - FM WW - CS WW - Str WW - FM WW - CS SW - Pipe SW - Pipe WW - TS WW - Str WW - Str WW - Str WW - FM WW - TF
WWFM WWFM WWPS-N WWPS-N WWM WWFM WWM WWPS-U WWFM WWM SWM SWM WWM SF-N SF-N WWPS-U WWFM WWTF-U I/I
350 mm 450 mm
268 2290 220 220
$1,193 $1,629 $6,000 $6,000 $1,060 $1,629 $1,060 $6,000 $1,629 $1,060 $895 $895 $1,439 $2,000 $2,000 $7,500 $2,695 N/A
$0.32 $3.73 $1.32 $1.32 $1.19 $4.61 $0.83 $1.32 $1.32 $0.54 $1.98 $1.50 $4.85 $13.60 $11.00 $6.05 $1.77 $24.50 $2.00
$0.00 $1.25 $0.00 $0.00 $0.00 $0.51 $0.00 $0.00
$0.51 $7.97 $2.11 $2.11 $1.91 $8.20 $1.33 $2.11 $2.11 $0.87
2031 2021 2024 2021 2024 2024 2024 2024 2024 2024 2013 2014 2016 2031 2039 2019 2019 2021 2015
2031-2036 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2012-2016 2012-2016 2016-2021 2031-2036 2036-2041 2016-2021 2016-2021 2021-2026 2012-2016
Aerotech 28 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51
13 13 13 13 13 13 13 13 13 13 6 6
600 mm 450 mm 600 mm
1,124 2,831 783 220
BL3
5 9 7 8 6 1 2 4 8 9
450 mm 600 mm 450 mm 450 mm 750 mm
810 513 2,207 1,681 3,370 6,800 5,500 807
$0.38 $0.38 $1.08 $0.80 $0.80 $0.00 $0.00 $0.00 $0.00
$3.76 $3.01 $9.48 $23.04 $18.88 $9.68 $2.83 $39.20 $3.20
3, 4, 5, 6, 13, 15, 16 1, 2, 7, 48, 49, 50 48 3, 4, 5, 6, 13, 15, 16 3, 4, 5, 6, 13, 15, 16
13 13 13 13 13 13 6
DA7 DA6
5 6 7 3
825 mm
657 16.06 MLD
East
47
EP1
I/I Reduction within Eastern Passage Drainage Area
Eastern Passage
I/I
$1.30
$0.00
$2.08
2014
2012-2016
Unknown
East East East East East East East West West West West West West West
48 49 50 51 52 53 54 19 20 21 22 23 24 25
EP2 EP3 EP4 EP5 EP6 EP7 EP8 HA1 HA2 HA3 HA4 HA5 HA6 HA7 HA6 HA5 EP7, EP8 EP6, EP8 EP6, EP7 HA2 HA1
8 6 2 7 3 4 5 7 8 3 2 4 5 6
Upgrade of Eastern Passage WWTF - NOT REQUIRED Storage Tank at Bissett Lake-Attwood PS Upgrade Quigley's Corner Pumping Station Twinning of existing Pressure Sewer from Caldwell to terminus Local pipe upgrades throughout system Local pipe upgrades throughout system Local pipe upgrades throughout system Upgrade of Kearney Rd PS 900 mm WWFM from Kearney Rd PS to Bicentennial Hwy (Hill top) 900 mm WWM from Bicentennial Hwy (Hill top) to St Margarets Bay Rd Gravity sewer from St Margarets Bay Rd to Armdale Rd PS Upgrade of Armdale (Rotary) Rd PS Forcemain from Armdale PS to Punch Bowl Dr (Hill Top) Gravity sewer from hill top to Herring Cove diversion
Eastern Passage Eastern Passage Eastern Passage Eastern Passage Eastern Passage Eastern Passage Eastern Passage Halifax Halifax Halifax Halifax Halifax Halifax Halifax WW - Str WW - Str WW - CS WW - CS WW - CS WW - CS WW - Str WW - FM WW - TS WW - TS WW - Str WW - FM WW - TS SF-U WWPS-U WWM WWM WWM WWM WWPS-U WWFM WWM WWM WWPS-U WWFM WWM
N/A N/A 1,150 10 675 mm 300 mm 450 mm 600 mm N/A 900 mm 900 mm 900 mm N/A 1050 mm 1050 mm 7,058 1,554 5,477 896 920 4,708 2,701 1,597 1,420 2,299 989 $2,000 $6,000 $1,312 $783 $895 $1,060 $7,500 $2,065 $1,796 $1,796 $9,000 $3,379 $2,941
$0.00 $2.30 $0.06 $9.26 $1.22 $4.90 $0.95 $6.90 $9.72 $4.85 $2.87 $12.78 $7.77 $2.91
$0.00 $0.00 $0.00 $1.35 $0.00 $0.00 $0.00 $0.00 $2.55 $5.03 $0.95 $0.00 $6.62 $2.95
$0.00 $3.68 $0.10 $16.98 $1.95 $7.84 $1.52 $11.04 $19.63 $15.81 $6.11 $20.45 $23.02 $9.38 2029 2014 2036 2026 2026 2026 2021 2021 2021 2019 2021 2021 2021 2026-2031 2012-2016 2031-2036 2026-2031 2026-2031 2026-2031 2021-2026 2016-2021 2016-2021 2016-2021 2021-2026 2021-2026 2021-2026
10, 12, 18 18 12 10, 18
13 13 13 13 13 13 13
25, 37, 46 25, 37, 46 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 37, 46 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 29, 31, 37, 46, 51 25, 37, 46
13 13 13 13 13 13 13
West
26
HA8
I/I Reduction Program
Halifax
I/I
$4.00
$0.00
$6.40
2013
2012-2016
January 9, 2013 K:\Engineering Dept\Common\Regional Development Charge\2012-11-28 RWWFP Capital Program - with IRP Objectives\RWWFP Capital Program - Base
Page 862
Regional Wastewater Functional Plan - Capital Program
Page 2 of 5
10
13
16
17
18
21
22
23
Wastewater Capital Program - Preferred Regional Servicing Strategy (RWWFP - No Declining Consumption)
Region
Capital Plan Area Project Project No. ID
Combined Project Delivery
Implementation Order
Project Description
System
HW Project Type WW - TS WW - TS WW - Str WW - FM WW - TF
Project Type
Diameter (mm)
Length (m), Flow (L/s), Volume (m3) 3,531 5,686 1,800 632 53.55 MLD

3
Base Cost $M (2012)
Other Costs (Crossings etc.) $M (2012) $4.28 $2.47 $0.00 $0.42 $0.00 $0.00
Year Req'd
Period Req'd
West West West West West West
32 33 34 35 36 37
HC1 HC2 HC3 HC4 HC5 HC6 HC4 HC3
2 3 4 5 6 1
Gravity sewer from Herring Cove diversion (top end) to Roaches Pond PS Gravity sewer from Princeton Rd (70m north of Roaches Pond PS) to Herring Cove PS Upgrade of Herring Cove SPS Forcemain from Herring Cove PS to Herring Cove WWTF Upgrade of Herring Cove WWTF I/I Reduction Program
Herring Cove Herring Cove Herring Cove Herring Cove Herring Cove Herring Cove
WWM WWM WWPS-U WWFM WWTF-U I/I
1050 mm 1050 mm N/A 1050 mm N/A
$2,941 $2,941 $9,000 $3,379 N/A
$10.38 $16.72 $16.20 $2.13 $84.90 $2.00
$23.46 $30.71 $25.92 $4.09 $135.84 $3.20
2021 2026 2026 2026 2031 2013
2021-2026 2026-2031 2026-2031 2026-2031 2031-2036 2012-2016
23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52
13 13 13 13 13 6
Central
11
MC1
I/I Reduction Program - manhole sealing
Mill Cove
MH
N/A
N/A
N/A
$0.03
$0.00
$0.05
2015
2012-2016
N/A
Central
12
MC2
Storage Facility #1 at Glendale/Old Beaver Bank Road (upstream of Bedford Sackville Trunk Sewer) Storage Facility #2 at Bedford Range Park (downstream of Bedford Sackville Trunk Sewer) Localized improvments to Bedford Sackville Trunk Sewer sections - diameters range between 525 mm and 1200 mm over 4.44 km. New wastewater pumping station at Mill Cove WWTF for diversion to Halifax
Mill Cove
WW - Str
SF-N
N/A
6,000
$2,000
$12.00
$0.00
$19.20
2013
2012-2016
40, 42, 43, 44
13
Central
13
MC3
Mill Cove
WW - Str
SF-N
N/A
7,000
$2,000
$14.00
$0.00
$22.40
2021
2021-2026
39, 38 42, 40, 43, 44, 39, 38, 41 42, 38, 39, 40, 41, 43, 44, 35
13
Central Central
14 15
MC4 MC5 MC6
5 6
Mill Cove Mill Cove
WW - TS WW - Str
WWM WWPS-N
Ranges N/A
4,436 330
$2,428 $6,000
$10.77 $1.98
$0.00 $0.00
$17.23 $3.17
2019 2019
2016-2021 2016-2021
13 13
Central Central Central Central Central Central Central Central
16 17 18 6 7 8 9 10
MC6 MC7 MC8 SP1 SP2 SP3 SP4 SP5
MC5
7 4 3
500mm Wastewater forcemain from Mill Cove WWTF to Mill Cove Diversion Sewer Diversion Sewer from Mill Cove WWTF to Halifax, along Bedford waterfront to Bedford Hwy tunnel General I/I reduction program allowance Springfield Lake forcemain pumping south New wastewater pumping station at Springfield Lake WWTF to pump flows back to Sackville Dr for diversion to Bedford Sackville Trunk Sewer Diversion Sewer from Springfield to Bedford Sackville Trunk Sewer Decommission Springfield WWTF Separation/resewerage - New storm sewers for Springfield Lake Stormwater Collection System
Mill Cove Mill Cove Mill Cove Springfield Springfield Springfield Springfield Springfield
WW - FM WW - CS
WWFM WWM I/I
500 mm 600 mm
1,139 3,147
$1,857 $1,060
$2.11 $3.34 $1.00
$0.00 $0.45 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$3.38 $6.05 $1.60 $2.45 $0.51 $1.12 $3.20 $10.74
2019 2016 2016 2026 2026 2016 2031 2016
2016-2021 2016-2021 2016-2021 2026-2031 2026-2031 2016-2021 2026-2031 2012-2016
42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42 42 42 N/A 42
13 13 6 14 14 14 14 6
SP2 SP1
4 3 2 5 1
WW - FM WW - Str WW - CS
WWFM WWPS-N WWM WWTF-D
200 mm N/A 300 mm N/A Ranges
1,941 53 896 N/A 6,714
$788 $6,000 $783 N/A $1,000
$1.53 $0.32 $0.70 $2.00 $6.71
SW - Pipe
SWM
GRAND TOTAL *Sizing and capacities based on 2011 calibrated hydraulic model. More accurate flow monitoring and observed data required for detailed design purposes may produce differing sizing and capacity needs.
$365.92
$37.37
$645.26 All objectives
603.93
Objective 13 only
Integrated Resource Plan (IRP) Related Objectives: Objective 6 Objective 13 Objective 14 - Meet Future Overflow Compliance. - Provide Regional Water, Wastewater and Stormwater Infrastructure Needed to Support Planned Growth. - Manage Flow Capacity Allocations.
For the purposes of calculating the proposed Regional Development Charge (RDC), only Objective 13 line items are considered. Total costs include the on-cost multiplier of 1.6 (refer to HW On-Cost and Overheads Calculation v4.pdf for details). This spreadsheet represents the original analysis from the RWWFP and does not consider declining consumption - the declining consumption assuming 1.5% reduction for 15 years and then flatlined thereafter is included in the full RDC calculation.
January 9, 2013 K:\Engineering Dept\Common\Regional Development Charge\2012-11-28 RWWFP Capital Program - with IRP Objectives\RWWFP Capital Program - Base
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Regional Wastewater Functional Plan - Capital Program (with Declining Consumption)

1 2 3 4 5 6 7 10 13 16 17 18 21 22 23 REDUCTION CONSUMPTION SCENARIO DETAILS
Region Capital Plan Area Project Project No. ID Combined Project Delivery Implementation Order Project Description System HW Project Type Project Type Diameter (mm) Length (m), Flow (L/s), Volume (m )
3
Page 3 of 5
Wastewater Capital Program - Consumption Reduction Assessment Regional Servicing

3
Base Cost $M (2012)
Other Costs (Crossings etc.) $M (2012) $0.00
Year Req'd
Period Req'd
Length (m), Flow (L/s), Volume (m )

3
Reduction Length (m), Flow (L/s), Volume (m3)
Reduction in Cost $M
Consumption Reduction Total Cost $M
Central
AT1
AT5
Upgrade Aerotech Drive Pumping station to 145 L/s, from 15 L/s (130 L/s upgrade)
Aerotech
WW - Str
WWPS-U
N/A
130
$6,000
$0.78
$1.25
2031
2031-2036
Aerotech
115lps
15lps
$0.14
$1.10
13
Central
AT2
AT4
Upgrade WWTF to service employment growth flows
Aerotech
WW - TF
WWTF-U
N/A
7.65 MLD
N/A
$13.60
$0.00
$21.76
2031
2031-2036
Aerotech
6.42MLD
1.23MLD
$3.40
$18.36
13
Central
AT3
Upgrade sewer conveyance to WWTF, from Aerotech Drive PS to WWTF
Aerotech
WW - CS
WWM
450 mm
1,650
$895
$1.48
$0.00
$2.36
2031
2031-2036
Aerotech
$0.00
$2.36
13
Central
AT4
AT2
Re-locate treated effluent discharge location to Soldiers Lake
Aerotech
WW - CS
WWM
450 mm
6,346
$895
$5.68
$5.11
$17.26
2031
2031-2036
Aerotech
$0.00
$17.26
13
Central West West West West West West West West West East East East East East East East East East
5 27 28 29 30 31 31 55 57 56 38 39 40 41 42 43 44 45 46
AT5 BL1 BL2 BL3 BL4 BL5 BL6 BL7 BL8 BL9 DA1 DA2 DA3 DA4 DA5 DA6 DA7 DA8 DA9
AT1 BL2 BL1 BL5
4 2 1 4 3
Upgrade Aerotech Drive PS forcemain to 145 L/s, from 15 L/s (130 L/s upgrade) 450 mm WWFM from BLT PS to 125 m south of Governors Lake Dr New BLT PS WWPS at Timberlea Village Pky (Site to be confirmed) WWPS New wastewater pumping station at Church St WWPS (Exact site to be determined) 600 mm WWM from Governor Lake Drive to Church St PS 450 mm WWFM from Church St PS to upstream of Bayers Lake PS 600 mm Hwy 3 WWM from RAMP SSH-4 to Bicentennial Hwy and North West Arm Dr Upgrade Bayers lake PS 450mm WWFM from Bayers Lake PS 600mm WWM to Bayers lake PS Gravity sewer from Little Albro Lake to Jamieson St PS 450mm surface water sewer from Fenwick St to Old Ferry Rd PS with the addition of Maynard St Sewer twinning along existing roads - Albro Lake/Slayter St to Ferry St PS Storage at Shannon Park vicinity Storage at Anderson Lake vicinity Upgrade of Ferry Rd PS by 807 L/s to provide total capacity of 900 L/s (existing PS has 93 L/s) 825mm Ferry Rd forcemain for 900l/s Upgrade of Dartmouth WWTF I/I Reduction Program
Aerotech BLT BLT BLT BLT BLT BLT BLT BLT BLT Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth Dartmouth
WW - FM WW - FM WW - Str WW - Str WW - CS WW - FM WW - CS WW - Str WW - FM WW - CS SW - Pipe SW - Pipe WW - TS WW - Str WW - Str WW - Str WW - FM WW - TF
WWFM WWFM WWPS-N WWPS-N WWM WWFM WWM WWPS-U WWFM WWM SWM SWM WWM SF-N SF-N WWPS-U WWFM WWTF-U I/I
350 mm 450 mm
268 2290 220 220
$1,193 $1,629 $6,000 $6,000 $1,060 $1,629 $1,060 $6,000 $1,629 $1,060 $895 $895 $1,439 $2,000 $2,000 $7,500 $2,695 N/A
$0.32 $3.73 $1.32 $1.32 $1.19 $4.61 $0.83 $1.32 $1.32 $0.54 $1.98 $1.50 $4.85 $13.60 $11.00 $6.05 $1.77 $24.50 $2.00
$0.00 $1.25 $0.00 $0.00 $0.00 $0.51 $0.00 $0.00
$0.51 $7.97 $2.11 $2.11 $1.91 $8.20 $1.33 $2.11 $2.11 $0.87
2031 2021 2024 2021 2024 2024 2024 2024 2024 2024 2013 2014 2016 2031 2039 2019 2019 2021 2015
2031-2036 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2021-2026 2012-2016 2012-2016 2016-2021 2031-2036 2036-2041 2016-2021 2016-2021 2021-2026 2012-2016
Aerotech 28 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51 28, 51 206lps 14lps 206lps 206lps 14lps 14lps
$0.00 $0.00 $0.13 $0.13 $0.00 $0.00 $0.00 $0.13 $0.00 $0.00 $0.00 $0.00
$0.51 $7.97 $1.98 $1.98 $1.91 $8.20 $1.33 $1.98 $2.11 $0.87 $3.76 $3.01 $9.48 $18.24 $16.00 $9.20 $2.83 $25.64 $3.20
13 13 13 13 13 13 13 13 13 13 6 6 13 13 13 13 13 13 6
600 mm 450 mm 600 mm
1,124 2,831 783 220
BL3
5 9 7 8 6 1 2 4 8 9
450 mm 600 mm 450 mm 450 mm 750 mm
810 513 2,207 1,681 3,370 6,800 5,500 807
$0.38 $0.38 $1.08 $0.80 $0.80 $0.00 $0.00 $0.00 $0.00
$3.76 $3.01 $9.48 $23.04 $18.88 $9.68 $2.83 $39.20 $3.20
3, 4, 5, 6, 13, 15, 16 1, 2, 7, 48, 49, 50 48 3, 4, 5, 6, 13, 15, 16 3, 4, 5, 6, 13, 15, 16 9.86MLD 6.2MLD 5300m3 4600m3 767lps 1500m3 900m3 40lps
$0.00 $4.80 $2.88 $0.48 $0.00 $13.56 $0.00
DA7 DA6
5 6 7 3
825 mm
657 16.06 MLD
East
47
EP1
I/I Reduction within Eastern Passage Drainage Area Upgrade of Eastern Passage WWTF. EP WWTF is currently being upgraded and expanded with allocation for growth considered. Projects to reduce I/I are proposed. Actual growth is to be monitored to confirm impacts on infrastructure Storage Tank at Bissett Lake-Attwood PS Upgrade Quigley's Corner Pumping Station Twinning of existing Pressure Sewer from Caldwell to terminus Local pipe upgrades throughout system Local pipe upgrades throughout system Local pipe upgrades throughout system Upgrade of Kearney Rd PS 900 mm WWFM from Kearney Rd PS to Bicentennial Hwy (Hill top) 900 mm WWM from Bicentennial Hwy (Hill top) to St Margarets Bay Rd Gravity sewer from St Margarets Bay Rd to Armdale Rd PS Upgrade of Armdale (Rotary) Rd PS Forcemain from Armdale PS to Punch Bowl Dr (Hill Top) Gravity sewer from hill top to Herring Cove diversion I/I Reduction Program
Eastern Passage
I/I
$1.30
$0.00
$2.08
2014
2012-2016
Unknown
$0.00
$2.08
East
48
EP2
Eastern Passage
N/A
$0.00
$0.00
$0.00
10, 12, 18
$0.00
$0.00
13
East East East East East East West West West West West West West West
49 50 51 52 53 54 19 20 21 22 23 24 25 26
EP3 EP4 EP5 EP6 EP7 EP8 HA1 HA2 HA3 HA4 HA5 HA6 HA7 HA8 HA6 HA5 EP7, EP8 EP6, EP8 EP6, EP7 HA2 HA1
6 2 7 3 4 5 7 8 3 2 4 5 6 1
Eastern Passage Eastern Passage Eastern Passage Eastern Passage Eastern Passage Eastern Passage Halifax Halifax Halifax Halifax Halifax Halifax Halifax Halifax
WW - Str WW - Str WW - CS WW - CS WW - CS WW - CS WW - Str WW - FM WW - TS WW - TS WW - Str WW - FM WW - TS
SF-U WWPS-U WWM WWM WWM WWM WWPS-U WWFM WWM WWM WWPS-U WWFM WWM I/I
N/A
1,150 10
$2,000 $6,000 $1,312 $783 $895 $1,060 $7,500 $2,065 $1,796 $1,796 $9,000 $3,379 $2,941
$2.30 $0.06 $9.26 $1.22 $4.90 $0.95 $6.90 $9.72 $4.85 $2.87 $12.78 $7.77 $2.91 $4.00
$0.00 $0.00 $1.35 $0.00 $0.00 $0.00 $0.00 $2.55 $5.03 $0.95 $0.00 $6.62 $2.95 $0.00
$3.68 $0.10 $16.98 $1.95 $7.84 $1.52 $11.04 $19.63 $15.81 $6.11 $20.45 $23.02 $9.38 $6.40
2029 2014 2036 2026 2026 2026 2021 2021 2021 2019 2021 2021 2021 2013
2026-2031 2012-2016 2031-2036 2026-2031 2026-2031 2026-2031 2021-2026 2016-2021 2016-2021 2016-2021 2021-2026 2021-2026 2021-2026 2012-2016
18 12 10, 18
0 0
1150m3 10lps
$3.68 $0.10 $0.00 $0.00 $0.00 $0.00
$0.00 $0.00 $16.98 $1.95 $7.84 $1.52 $10.56 $19.63 $15.81 $6.11 $19.30 $23.02 $9.38 $6.40
13 13 13 13 13 13 13 13 13 13 13 13 13 6
675 mm 300 mm 450 mm 600 mm N/A 900 mm 900 mm 900 mm N/A 1050 mm 1050 mm
7,058 1,554 5,477 896 920 4,708 2,701 1,597 1,420 2,299 989
25, 37, 46 25, 37, 46 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 37, 46 23, 24, 25, 27, 28, 37, 46, 51 23, 24, 25, 27, 28, 29, 31, 37, 46, 51 25, 37, 46
880lps
40lps
$0.48 $0.00 $0.00 $0.00
1340lps
80lps
$1.15 $0.00 $0.00 $0.00
January 9, 2013 K:\Engineering Dept\Common\Regional Development Charge\2012-11-28 RWWFP Capital Program - with IRP Objectives\RWWFP - Declining Consumption
Page 864
Regional Wastewater Functional Plan - Capital Program (with Declining Consumption)

1 2 3 4 5 6 7 10 13 16 17 18 21 22 23 REDUCTION CONSUMPTION SCENARIO DETAILS
Region Capital Plan Area Project Project No. ID Combined Project Delivery Implementation Order Project Description System HW Project Type WW - TS WW - TS WW - Str WW - FM WW - TF Project Type Diameter (mm) Length (m), Flow (L/s), Volume (m ) 3,531 5,686 1,800 632 53.55 MLD
3
Page 4 of 5
Wastewater Capital Program - Consumption Reduction Assessment Regional Servicing

3
Base Cost $M (2012)
Other Costs (Crossings etc.) $M (2012) $4.28 $2.47 $0.00 $0.42 $0.00 $0.00
Year Req'd
Period Req'd
Length (m), Flow (L/s), Volume (m )

3
Reduction Length (m), Flow (L/s), Volume (m3)
Reduction in Cost $M
Consumption Reduction Total Cost $M
West West West West West West
32 33 34 35 36 37
HC1 HC2 HC3 HC4 HC5 HC6 HC4 HC3
2 3 4 5 6 1
Gravity sewer from Herring Cove diversion (top end) to Roaches Pond PS Gravity sewer from Princeton Rd (70m north of Roaches Pond PS) to Herring Cove PS Upgrade of Herring Cove SPS Forcemain from Herring Cove PS to Herring Cove WWTF Upgrade of Herring Cove WWTF I/I Reduction Program
Herring Cove Herring Cove Herring Cove Herring Cove Herring Cove Herring Cove
WWM WWM WWPS-U WWFM WWTF-U I/I
1050 mm 1050 mm N/A 1050 mm N/A
$2,941 $2,941 $9,000 $3,379 N/A
$10.38 $16.72 $16.20 $2.13 $84.90 $2.00
$23.46 $30.71 $25.92 $4.09 $135.84 $3.20
2021 2026 2026 2026 2031 2013
2021-2026 2026-2031 2026-2031 2026-2031 2031-2036 2012-2016
23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52 23, 24, 25, 27, 28, 29, 30, 31, 32, 34, 37, 46, 51, 52
$0.00 $0.00 1740lps 60lps $0.86 $0.00 40.75MLD 12,8MLD $28.49 $0.00
$23.46 $30.71 $25.06 $4.09 $107.35 $3.20
13 13 13 13 13 6
Central
11
MC1
I/I Reduction Program - manhole sealing
Mill Cove
MH
N/A
N/A
N/A
$0.03
$0.00
$0.05
2015
2012-2016
N/A
$0.00
$0.05
Central
12
MC2
Storage Facility #1 at Glendale/Old Beaver Bank Road (upstream of Bedford Sackville Trunk Sewer) Storage Facility #2 at Bedford Range Park (downstream of Bedford Sackville Trunk Sewer) Localized improvments to Bedford Sackville Trunk Sewer sections - diameters range between 525 mm and 1200 mm over 4.44 km. New wastewater pumping station at Mill Cove WWTF for diversion to Halifax
Mill Cove
WW - Str
SF-N
N/A
6,000
$2,000
$12.00
$0.00
$19.20
2013
2012-2016
40, 42, 43, 44
4000m3
2000m3
$6.40
$12.80
13
Central
13
MC3
Mill Cove
WW - Str
SF-N
N/A
7,000
$2,000
$14.00
$0.00
$22.40
2021
2021-2026
39, 38 42, 40, 43, 44, 39, 38, 41 42, 38, 39, 40, 41, 43, 44, 35
4200m3
2800m3
$8.96
$13.44
13
Central Central
14 15
MC4 MC5 MC6
5 6
Mill Cove Mill Cove
WW - TS WW - Str
WWM WWPS-N
Ranges N/A
4,436 330
$2,428 $6,000
$10.77 $1.98
$0.00 $0.00
$17.23 $3.17
2019 2019
2016-2021 2016-2021
$0.00 318lps 12lps $0.12
$17.23 $3.05
13 13
Central Central Central Central Central Central Central Central
16 17 18 6 7 8 9 10
MC6 MC7 MC8 SP1 SP2 SP3 SP4 SP5
MC5
7 4 3
500mm Wastewater forcemain from Mill Cove WWTF to Mill Cove Diversion Sewer Diversion Sewer from Mill Cove WWTF to Halifax, along Bedford waterfront to Bedford Hwy tunnel General I/I reduction program allowance Springfield Lake forcemain pumping south New wastewater pumping station at Springfield Lake WWTF to pump flows back to Sackville Dr for diversion to Bedford Sackville Trunk Sewer Diversion Sewer from Springfield to Bedford Sackville Trunk Sewer Decommission Springfield WWTF Separation/resewerage - New storm sewers for Springfield Lake Stormwater Collection System
Mill Cove Mill Cove Mill Cove Springfield Springfield Springfield Springfield Springfield
WW - FM WW - CS
WWFM WWM I/I
500 mm 600 mm
1,139 3,147
$1,857 $1,060
$2.11 $3.34 $1.00
$0.00 $0.45 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
$3.38 $6.05 $1.60 $2.45 $0.51 $1.12 $3.20 $10.74
2019 2016 2016 2026 2026 2016 2031 2016
2016-2021 2016-2021 2016-2021 2026-2031 2026-2031 2016-2021 2026-2031 2012-2016
42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42, 38, 39, 40, 41, 43, 44, 35, 36, 37 42 42 42 N/A 42 50lps 3lps
$0.00 $0.00 $0.00 $0.00 $0.03 $0.00 $0.00 $0.00
$3.38 $6.05 $1.60 $2.45 $0.48 $1.12 $3.20 $10.74
13 13 6 14 14 14 14 6
SP2 SP1
4 3 2 5 1
WW - FM WW - Str WW - CS
WWFM WWPS-N WWM WWTF-D
200 mm N/A 300 mm N/A Ranges
1,941 53 896 N/A 6,714
$788 $6,000 $783 N/A $1,000
$1.53 $0.32 $0.70 $2.00 $6.71
SW - Pipe
SWM
GRAND TOTAL *Sizing and capacities based on 2011 calibrated hydraulic model. More accurate flow monitoring and observed data required for detailed design purposes may produce differing sizing and capacity needs.
$365.92
$37.37
$645.26 All objectives
$75.94
569.32
528.02
Integrated Resource Plan (IRP) Related Objectives: Objective 6 Objective 13 Objective 14 - Meet Future Overflow Compliance. - Provide Regional Water, Wastewater and Stormwater Infrastructure Needed to Support Planned Growth. - Manage Flow Capacity Allocations.
All objectives with declining Objective 13 only consumption with declining consumption
For the purposes of calculating the proposed Regional Development Charge (RDC), only Objective 13 line items are considered. Total costs include the on-cost multiplier of 1.6 (refer to HW On-Cost and Overheads Calculation v4.pdf for details).
January 9, 2013 K:\Engineering Dept\Common\Regional Development Charge\2012-11-28 RWWFP Capital Program - with IRP Objectives\RWWFP - Declining Consumption
Page 865
Regional Wastewater Functional Plan - Acronyms Legend

PROJECT TYPE Wastewater Main Stormwater Main Forcemain Storage Facility New Storage Facility Upgrade Manhole Sewage Pumping Station - New Sewage Pumping Station - Upgrade Wastewater Treatment Facility - Decommission Wastewater Treatment Facility - Upgrade I/I Reduction = = = = = = = = = = = WWM SWM WWFM SF-N SF-U MH WWPS - N WWPS - U WWTF - D WWTF - U I/I GROWTH AREAS
1 2 3 4 5 6 7 8 9 10 11 12 13 14 14a 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53
Page 5 of 5
REGIONS East West Central Fall River (no growth) Frame (no growth) Mill Cove Springfield Lake Uplands Park (no growth) Middle Musquodoboit (no growth) Wellington (no growth) Halifax Herring Cove Beechville Lakeside Timberlea (BLT) Aero Tech Burnside Dartmouth Eastern Passage North Preston (no growth)
= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
Shannon Park Ocean Breeze King's Wharf Downtown Dartmouth Infill Dartmouth Cove Infill Penhorn Mall Dartmouth Crossing (Burnside East) Morris Lake Morris - Russell Lake Morris Lake East * Shearwater Annex ("The Boot") ** Briarwood (Armco) Woodside (Innovacorp) *** Woodside Growth Centre - Urban Woodside Growth Centre - Suburban Mic Mac Mall Infill Prince Albert Infill Main Street Commercial Corridor Cole Harbour Road Brightwood *** Hx Peninsula Infill S of Young St Hx Peninsula Infill N of Young St Motherhouse Geiser Hill Bayer's Lake Industrial Bedford West - Kearney Maritime Broadcasting Lands Ragged Lake Brunello Lands Rockcliffe Village Governor's Brook Herring Cove Road Infill Spryfield Growth Centre Birch Cove Purcell's Cove Road Service Extension* Bedford West in Central Region Bedford Waterfront Papermill Lake Bedford Commons Sackville Drive Corridor Sunset Ridge Sunnyside Mall Springfield Lake Twin Brooks Berry Hills Port Wallace * Susie Lake * Sandy Lake * Anderson Lake * Burnside Phase 12 Burnside Phase 13 Governor Lake North Kidston Lake Lands Ragged Lake
January Dept\Common\Regional Development Charge\2012-11-28 RWWFP Capital Program - with IRP Objectives\Acronyms &Page 866 K:\Engineering 9, 2013 Legend
B-2
RWWFP Cost Tables (RWWFP Appendix E)
January 9, 2013
Page 867
APPENDIX B-2
January 9, 2013
Page 868
January 9, 2013
Page 869
January 9, 2013
Page 870
January 9, 2013
Page 871
B-3
IRP Unit Cost Summary
January 9, 2013
Page 872
Halifax Water Integrated Resource Plan Infrastructural Replacement Unit Rates Water Systems
Table W.1 -Water Distribution Mains
Page 1 of 34
APPENDIX B-3
6 75 years expected life
On-Cost Multipliers 23% Construction Costs Diameter (mm) ($/m) 1,2,4,5 200 250 300 350 400 450 500 550 600 675 750 900 1,050 1,200 1,350 1,500 712 800 933 977 1,021 1,065 1,110 1,154 1,198 1,507 1,595 1,772 2,214 2,390 2,920 3,627 On-cost ($) 164 184 215 225 235 245 255 265 276 276 347 367 408 509 550 672 20% Risk ($) 175 197 230 240 251 262 273 284 295 357 388 428 524 580 694 860 4% HST ($) 45 51 59 62 65 67 70 73 76 92 100 110 135 149 179 221 4% 60% Breakdown of Water Distribution Mains Overhead Total Unit ($) Cost ($/m) 3 44 49 57 60 63 66 68 71 74 89 97 107 131 145 174 215 1,140 1,281 1,494 1,564 1,635 1,706 1,776 1,847 1,918 2,320 2,528 2,784 3,412 3,774 4,516 5,595
Dia (mm) <75 75 100 150 200 225 250 300 350 375 400 450 500 Aerotech 400 Total (km)
Length (km) 4 1 11 281 333 35 110 261 26 14 77 11 16 7 1,187
Cost Rate ($/m) 1,140 1,140 1,140 1,140 1,140 1,140 1,281 1,494 1,564 1,635 1,635 1,706 1,776 1,635 Total ($k)
Cost ($k) 4,413 860 13,035 319,936 380,079 39,564 140,556 390,414 39,992 22,687 126,333 19,574 28,061 11,510 1,537,014
Notes 1 Water Distribution mains include hydrants, new water meters, and service connections 2 Construction unit costs from HRM's 2007 Database (excluding on-costs), with additional build up, and including a 2% indexing per year. Build up cost assumed install costs are 60% of supply costs, fill is $ 65 per m and excavation is $20 per m. 3 4 5 6 Total unit cost include on-cost multiplier. Pipe material typically Ductile Iron (DI) Class 52, unless otherwise noted. Assume aveage main dia of 50mm, 1.8m depth for main, 1:1 construction, 0.5m bedding. Installation costs include traffic control, environmental protection, and restoration. Expected Life from GENIVAR (RWS).
January 9, 2013 Revision Number 5
Page 873
Table W.2 - Water Transmission Mains (Ductile Iron)
*see tab "W Trans. Pipe Breakdown" for a detailed summary
Total Length (km) Replacement Cost ($) 217.1 $494,668,604
Page 2 of 34
75 years expected life
Notes
1 Same as Table W.1 Water Distribution Mains

2 3 4 5 Construction and Total Unit Cost are the same for Water Distribution Mains (Table W.1). All new water transmission mains are Class 52 Ductile Iron unless specifically noted. Renewal, relining, or replacement of Hyprescon water transmission mains covered by specific individual capital project not covered here. Expected Life From GENIVAR (RWS).
Page 874
Table W.3 - Water Meters
Page 3 of 34
On-Cost Multipliers 23% On-cost ($) Residential Meters Average Installation Cost per Unit ($)
1
20% Risk ($)
4% HST ($)
4% Overhead ($)
60% Total Unit Cost ($ per meter) 3 320
200
46
49
13
12
Commercial Meters Average Installation Cost per Unit ($)

1
500
115
123
32
31
800
Number of Meters Residential Commercial Total Notes 1 2 3 4 76,366 4,621 80,987
Total Replacement Cost ($) 24,450,762 3,698,864 28,149,626
Average installation unit cost from Halifax Water's Database. Expected Life from GENIVAR (RWS). Total installed unit cost includes on-cost multiplier. Unit cost of new water meters installed as part of water main replacement project included in unit cost of pipe (Table W.1).
Page 875
Page 4 of 34
Table W.4 - Water Chambers - PRV's , Meters, and Control Valves (Page 1 of 2)
Number of Locations / Location Small PRV Medium PRV Large PRVs Water Robie Street No. 1 PRV 4 66 Construction Costs ($) 1 54,567 163,702 1,309,619 545,675 436,540 327,405 327,405 272,837 272,837 218,270 218,270 109,135 103,938 Total with OnCost (1.6) ($) 87,307 261,923 2,095,390 873,079 698,463 523,848 523,848 436,540 436,540 349,232 349,232 174,616 166,301
Water Rockmanor Pumping Station Water Titus & Evans PRV Chain Control PRV Water Sackville Drive PRV MacDonald Bridge PRV Water Robie Street No. 2 PRV Bluewater Road PRV Water Zinck Avenue PRV Lancaster Drive Emergency PRV Dunbrack St N of Main St PRV New Other Meter Chambers Meter Chambers Kearney Lake Rd Meter Chamber Flynn Park Meter Blue Mountain Meter Lucasville Road Meter Hammond Kearney Meter Notes 1 2 3 4 5 22
PRVs
Total
54,567 109,135 163,702 218,270 272,837 763,944
24,263,247
87,307 174,616 261,924 349,232 436,540 1,222,311
Total
4,365,380
Construction cost based on HW 2011 Insurance Renewal values with additional 2% for indexing. Civil components were assumed to be new, therefore not replaced during IRP For PRV's only M&E was replaced every 20 years at 50% of the asset value (i.e. no ICA component was considered) An age distribution was created and assumed PRVs were installed from 1993 onwards Chambers and Meters are modelled as civil items with an expected 50 year life, hence were not scheduled for renewal during the IRP
Page 876
Table W.4 - Water Chambers - PRV's , Meters, and Control Valves (Page 2 or 2)
Number of Locations / Location Small Values 2 (at Aerotech) Other Control Value Chambers Near Aerotech STP Hemlock Control Chamber Lyle Street Control Chamber Main No. 2 Control Chamber Main No. 1 Control Chamber Mount Edward Rd Control Chamber Orchard Control Chamber East - Topsail Drive Cowie Hill Road PRV Kearney Control Construction Costs ($) 1 54,567 218,270 818,512 818,512 654,809 1,746,158 436,540 654,809 436,540 873,079 436,540 Total Unit Cost ($) 87,307 349,232 1,309,619 1,309,619 1,047,695 2,793,853 698,463 1,047,695 698,463 1,396,927 698,463
Page 5 of 34
Control Value Chambers
Total
11,524,644
Assumptions for Chambers/Control Valves Asset Sub- % of Asset Expected Life category Value (years) Civil 100% 50 structure / Building
Assumptions for PRV Asset Sub% of Asset Expected Life category Value (years) Civil structure / 40% 50 Building Pumping M&E Equipment 50% 20
Notes 1 Construction cost based on HW 2011 Insurance Renewal values with additional 2% for indexing. Detail breakdown of insurance cost on tab "W Insurance Costs - PRV, MC, VC
Page 877
Table W.5 - Water Valves
Page 6 of 34
2 75 years expected life
On-Cost Multipliers 23% Description 150 mm Gate Valve 200 mm Gate Valve 250 mm Gate Valve 300 mm Gate Valve 350 mm Gate Valve 400 mm Gate Valve 450 mm Gate Valve 500 mm Gate Valve 550 mm Gate Valve 600 mm Gate Valve Notes 1 2 3 4 5 Cost per Unit ($) 1 1,000 1,650 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 On-cost ($) 230 380 575 690 805 920 1,035 1,150 1,265 1,380 20% Risk ($) 246 406 615 738 861 984 1,107 1,230 1,353 1,476 4% HST ($) 63 104 158 190 222 253 285 317 348 380 4% Overhead ($) 62 102 154 185 216 246 277 308 339 369 60% Total Unit Cost per meter 2 1,601 2,641 4,002 4,803 5,603 6,404 7,204 8,004 8,805 9,605 Average Cost ($) Number of Valves 5 Total Replacement Cost ($)
Replacement Costs ($) 5,867 13,027 76,432,974
Installation cost (excluding on-cost multiplier) from HRM database. Expected life from GENIVAR (RWS). Total installed unit cost includes on-cost multiplier. Unit cost of new water valves installed as part of water main replacement projects included in unit cost of pipe (Table W.1). From HW 2009 Annual Report
Page 878
Table W.6 - Water Pumping Stations
On-Cost Multipliers 23% Construction Cost per MLD ($/MLD)
1
Page 7 of 34
Assumptions 4% Overhead ($) 9,236 60% Total Unit Cost ($/MLD) 2 240,134 Asset Subcategory Civil structure / Building Pumping M&E Equipment ICA, Telemetry & SCADA % of Asset Value 40% Expected Life (years) 50
20% Risk ($)
4% HST ($)
On-cost ($)
150,000
34,500
36,900
9,498
50% 10%
20 10
Water Pumping Station Bennery Lake / Aerotech Pumping Station Beaverbank Pumping Station Bedford South Pumping Station Bedford Village Pumping Station Crestview Pumping Station Eaglewood Pumping Station Lively Booster Station No. 7 Highway Pumping Station Rockmanor Pumping Station Silverside Pumping Station Upper Hammonds Plains Pumping Station Lyle Street Control Chamber Mount Edward Pumping Station Charles Road Pumping Station Cowie Reservoir Pumping Station Leiblin Pumping Station Parkdale Pumping Station Robie Street Emerg. Pump. Station St. Margarets Bay Road Pumping Station
MLD 27.3 12.8 13.0 17.2 2.6 0.1 0.5 9.5 10.5 2.1 2.2 9.1 19.8 5.2 9.5 11.3 7.2 27.3 6.5
Total Cost 6,544,844 (separate asset renewal run) 3,062,987 3,121,891 4,123,252 626,996 26,179 124,352 2,290,695 2,520,454 510,498 523,588 2,182,051 4,764,647 1,236,976 2,277,606 2,701,712 1,727,839 6,544,844 1,570,763 46,482,172
Total Replacement Cost Notes 1 2 3 4
Construction costs per MLD (excluding on-cost multiplier) from averaging 2011 HW Insurance renewal values ($/MLD) of pumping station inventory (tab W HW Insurance Costs Water PS) Total installed cost in MLD includes on-cost multiplier. There are two (2) water pumping asset renewal models: 1. all the stations in HRM, and 2. Aerotech pumping station. For the asset renewal models, the civil structure was assumed new (not replaced during IRP), only M&E and ICA were replaced based on the assumption table above
Page 879
Table W.7 -Concrete Water Reservoirs
Concrete Capacity ML Mount Edward 1 Replacement with Steel Tank Cowie Hill Replacement with Steel Tank Geizer 123 Replacement with Steel Tank Lakeside/Timberlea Replacement with Steel Tank Meadowbrook Replacement with Steel Tank Middle Musquodoboit Robie Replacement Year (from HW) 2022 2027 2032 2037 2042 2064 2060 Replacement Steel Cost ($k)(1.6) 7,855 4,163 10,829 2,202
Page 8 of 34
22.7 11.4 31.8 5.4 9.1 0.3 15.9
Total Cost ($k) during IRP HW Insurance Cost ($k) of all Concrete Tanks
28,460 53,013
3,411 535 not replaced during IRP 5,633 not replaced during IRP
Notes 1 In the financial model, each service reservoir was included by a separate project row in objective 8 (Asset Renewal) 2 For Concrete Tanks, the replacement steel cost of equal capacity was calculated using the Reed-Steel Linear regression provided by HALCROW with on cost multiplier of 1.6 (see tab "W Cost Est. Concrete to Steel") 3 Insurance costs for concrete and steel tanks are in tab "W HW Insurance Storage Tanks"
Page 880
Table W.8-Steel Water Reservoirs
Page 9 of 34
Coating of tank every 20 years Cost Assumption for Steel Tanks
Steel Aerotech (small tank) Coating in 2014 and 2034 Akerley Blvd. (large tank) Coating in 2021 and 2041 Beaver Bank (small tank) Coating in 2027 Geizer 158 (large tank) Coating in 20115 and 2035 Mount Edward 2 (large tank) Coating in 2018 and 2033 North Preston (small tank) Coating in 2013 and 2033 Sampson(large tank) Coating in 2029. Stokil (large tank) Coating in 2020 and 2040. Waverley (small tank) Coating in 2019 and 2039
Capacity ML 4.1 37.7 6.9 36.4 22.7 1.6 12.2 23.6 1.3
Install Date 1986 1986 2007 1986 1998 1988 1970 1991 1982
Size Class. Cost per Coating Year Of Tank coating ($k) (from HW) (Small or (with on Large) cost) 2014, 2034 Small 320 2021, 2041 2027, 2047 2015, 2035 2018, 2038 2013, 2033 2029 2020, 2040 2019, 2039 Large Small Large Large Small Small Large Small Total During IRP 960 320 960 960 320 320 960 320
Estimation from HW ($k) Small Tank Large Tank 200 600
With on-cost multiple(1.6) ($k) 320 960
HW Insurance Cost of All Steel Tanks ($k)
86,478
10,240
Notes 1 In the financial model, each service reservoir is a separate project in objective 8 (Asset Renewal) 2 For Steel Tanks, replacement of the whole tank is not considered during the IRP as all are in reasonable shape 3 Steel Tank are to be coated every 20 years (years provided by HW). A coating cost was used based on being either a small tank of large tank (from HW estimates)
Page 881
Table W.9 - Dams
Page 10 of 34
Suficial concrete and mechanical renewal of dams done every 20 years. Approximate design life of 100 years for core dam replacement.
On-Cost Multipliers 23% Name of Dam Type of Dam Construction Cost ($k) 1 4,420 2,254 2,701 819 1,310 2,254 On-cost ($k) 1,017 518 621 188 301 518 20% Risk ($k) 1,087 554 664 201 322 554 4% HST ($k) 280 143 171 52 83 143 4% Overhead ($k) 272 139 166 50 81 139 Insurance Cost with On cost Notes 1 2 3 4 60% Total Dam Cost ($k) with Year to Replace or Repair Dam on cost (asset value) 7,076 2025 (repair) 3,608 2025 (repair) 4,324 2040 (replace) 1,310 2020 (repair) 2,097 2017 (replace) 3,608 2020 and 2040 (repair) 22,023 Cost ($k) in Financial Model 1,415 722 4,324 262 2,097 722
% of asset value 20 20 100 20 100 20
Earth fill with clay core Pockwock Lake Granular Fill with HDPE Core Bayers Lake Chain Lake Gravel and loam with concrete core wall Earth fill (Till) Lake Lamont Rocked filled Timber Crib Lake Major Concrete East Lake 2
Total Replaced during IRP
10,263
Construction Costs (excluding on-cost multiplier) from HW 2011 Insurance renewal values with additional 2% indexing for 2012. Notlisted in 2011 Insurance Renewal Values, TG suggested to use the value from Bayers Lake. In the financial model, each dam is a separate project in objective 8 (Asset Renewal) The year of replacement or repair for the dam was given by HW. For a replacement of a dam 100% of the asset value was used, for a repair 20% of the asset value was used.
Page 882
Table W.10- Water Supply Plants
Page 11 of 34
On-Cost Multipliers 23% Facility J.D. Kline WSP Lake Major WSP Storage Building Garage Bennery Lake WSP Low Lift Five Island lake Collins park Middle Musquodoboit Silver Sands Miller Lake Bo-Mont Chain Lake Back up Supply Pumping plant (emergency) Lake Lamont Backup Supply Plant 25m /day 160m3/day 260m3/day 144m3/day 55m3/day 20m3/day
3
20% Risk ($k) 12,618 12,303 3 3 2,685 134 27 483 456 50 50 107 67 201 537
4% HST ($k) 3,248 3,167 1 1 691 35 7 124 117 13 13 28 17 52 138
4% Overhead ($k) 3,158 3,079 1 1 672 34 7 121 114 13 13 27 17 50 134
60% Total with On- Type of WSP for Cost ($k) Asset Renewal 82,115 80,066 18 18 17,471 874 175 3,145 2,970 327 327 699 437 1,310 3,494 193,446 large large large large Aerotech Aerotech small small small small small small small small small Total Small WSP ($k) 12,883 Total Aerotech/Bennery ($k) 18,345 Total Large WSP ($k) 162,218
Firm Capacity 227MLD 90MLD
Estimated Construction Cost ($k)1 51,293 50,013 11 11 10,913 546 109 1,964 1,855 204 204 437 273 819 2,183
On-cost ($k) 11,797 11,503 3 3 2,510 126 25 452 427 47 47 100 63 188 502
4MLD
Total Insurance Cost Assumptions Asset Subcategory Civil structure / Building M&E Pumping Equipment ICA, Telemetry & SCADA % of Asset Value 40% 50% 10% Expected Life (years) 50 30 10
Notes 1 Construction Costs (excluding on-cost multiplier) from HW 2011 Insurance renewal values with additional 2% indexing for 2012. 2 The Water Supply Plants (WSP) were divided into three (3) categories for asset renewal: Large (J.D.Kline WSP and Lake Major WSP), small system , and Bennery Lake (Aerotech). In the Asset Renewal Summary costs are combined for the large WSP and Bennery WSP. 3 For asset renewal it was assumed that all civil components were new and did not need to be replaced, thus only the M&E and ICA were renewed (see assumptions table)
Page 883
Halifax Water Integrated Resource Plan Infrastructural Replacement Unit Rates Waste Water Systems
Page 12 of 34
Table WW.1 - Sanitary and Trunk Sewers

100 years expected life On-Cost Multipliers 23% Dia. (mm) 300 375 450 525 600 675 750 825 900 975 1050 1200 1350 1500 1650 1800 2100 2400 Unit Cost ($/m)
1
20% Risk ($) 180 193 206 219 244 302 331 346 413 608 676 753 848 947 1048 1178 1332 1715 2327 193 207 220 235 261 323 354 370 442 650 723 806 907 1013 1121 1260 1425 1834 2488
4% HST ($) 50 53 57 60 67 83 91 95 114 167 186 207 233 261 288 324 367 472 641
4% Overhead ($) 48 52 55 59 65 81 89 93 111 163 181 202 227 254 280 315 357 459 623
60% Total Unit Cost ($/m) 1,253 1,345 1,432 1,528 1,697 2,101 2,303 2,409 2,875 4,229 4,708 5,243 5,902 6,595 7,292 8,203 9,275 11,938 16,194 Dia (mm) 600 750 900 1050 1200 1200+ Total Km Dia (mm) 200 250 300 375 450 525 300 Total Km
Breakdown of Sanitary Sewers Length (km) Cost Rate $/m 403 477 146 97 48 21 3 1253 1253 1253 1345 1432 1528 1253 Cost ($k) 504,616 597,322 182,402 129,760 68,096 32,645 3,886 1,518,727
On-cost ($)
783 840 895 954 1,060 1,312 1,439 1,505 1,796 2,642 2,941 3,275 3,687 4,119 4,555 5,124 5,793 7,457
Aerotech
1193 Total Cost $k Breakdown of Trunk Sewers Length (km) Cost Rate $/m 42 21 44 10 16 12 1697 2303 2875 4708 5243 8830
Cost ($k) 71,352 49,193 125,687 46,498 82,849 107,849 483,428
145 Total Cost $k
3000 10,116 Notes
1 Unit cost from RWWFP (Final Recommended UR 2012 $), assumes 5m gravity sewer including wastewater manholes and connections.
Page 884
Page 13 of 34
Table WW.2 - Duplex (Twin) Forcemains

50 years expected life On-Cost Multipliers 23% Diameter (mm) 150 200 250 300 350 400 450 500 600 750 900 1050 1200 Notes 1 Expected Life from GENIVAR (RWS). 2 Forcemain unit costs (includes valves and fittings) from RWWFP (which was calculated using the recommended UR 2012$ with 40% uplift for twin installation) Breakdown of Forcemains Length km Cost Rate $/m 75 3.0 1167 100 12.1 1167 150 12.2 1167 300 16.7 1483 500 22.1 2973 1050 0.6 5410 150 23.8 520 300 0.19 1483 100 0.19 1167 90.7 Total Cost $k Unit Cost ($/m)
2 1
20% Risk ($) 179 194 209 228 294 348 401 457 573 615 711 831 952
4% HST ($) 46 50 54 59 76 90 103 118 147 158 183 214 245
4% Overhead ($) 45 49 52 57 73 87 100 114 143 154 178 208 238
60% Total Unit Cost ($/m) 1,167 1,261 1,362 1,483 1,910 2,263 2,609 2,973 3,728 4,000 4,629 5,410 6,198
On-cost ($) 168 181 196 213 274 325 375 427 536 575 665 777 890
729 788 851 926 1193 1414 1629 1857 2329 2499 2891 3379 3871
Dia
Aerotech Total km
Cost $k 3,532 14,109 14,191 24,700 65,686 3,029 12,367 282 222 138,116
Page 885
Page 14 of 34
Table WW.3 - Wastewater Pumping Stations

HW 2010 Insurance Renewal, Property Book of Valves DRAFT See tab: "WW pumping station Re. Org." With OnTotal Cost Replaceme Multiplier nt Cost ($k) (60%)($k) 352 960 1,760 3,680 Total 38,016 33,600 22,880 47,840 142,336
Type
Range
Number of Stations
Insurance Cost ($k)
Rounding ($k)
Monument Building Building Building
< 47hp < 35hp 36 to 99hp > 100hp
108 35 13 13 3 172
214 590 1,052 2,332
220 600 1100 2300
Not Under HW Ownership at this time Total # of Stations
Storage for Wastewater Pumping Stations In Ground Storage 3 $2000 per m (from HW) Assumptions % of Asset Expected Life Asset Sub-category Value (years) Civil 40% 50 Pumping, M&E 50% 20 ICA, Telemetry & SCADA 10% 10 Notes 1 Assume upgrade is for Pumping M&E Equipment & ICA 2 Total unit cost including on-cost multiplier.
Page 886
Table WW.4 - Waste Water Treatment Plants
Page 15 of 34
Wastewater Treatment Works Estimated Construction Cost no contingencies (2012 $) 121,400,000 78,300,000 30,900,000 3,000,000 1,600,000 4,000,000 1,700,000 1,700,000 1,700,000 3,800,000 59,600,000 22,900,000 13,700,000 12,500,000 Total Notes 1 Costs from XCG - email Feb 8 from Melody Johnson 2 For asset renewal it was assumed that all civil components were new and did not need to be replaced, thus only the M&E and ICA were renewed (see assumptions table) Project Cost (2012 $, 1.6 multiplier applied to construction costs) 1 194,240,000 125,280,000 49,440,000 4,800,000 2,560,000 6,400,000 2,720,000 2,720,000 2,720,000 6,080,000 95,360,000 36,640,000 21,920,000 20,000,000 570,880,000
Facility
Halifax WWTF Dartmouth WWTF Herring Cove WWTF Lockview MacPherson WWTF Middle Musquodoboit WWTF North Preston WWTF Uplands Park WWTF Wellington WWTF Frame WWTF Springfield Lake WWTF Mill Cove WWTF Eastern Passage WWTF BLT WWTF Aerotech WWTF
Assumptions % of Asset Asset Sub-category Value Civil structure / Building 40% Pumping M&E 50% Equipment ICA, Telemetry & SCADA 10%
Expected Life (years) 50 30 10
Page 887
Halifax Water Integrated Resource Plan Infrastructural Replacement Unit Rates Stormwater Systems
Page 16 of 34
Table S.1 - Stormwater Pipes

On-Cost Multipliers Material 23% Storm Storm Sewer Sewer Diameter On-cost ($) (mm) PVC ($/m) Concrete 2 65D ($/m) 250 552 127 300 375 450 300 375 450 525 600 750 900 1050 1200 1350 1500 1650 1800 2100 2400 3000 591 640 751 694 730 765 818 871 924 977 1,048 1,154 1,595 1,949 2,125 2,302 2,655 3,009 3,715 136 147 173 160 168 176 188 200 213 225 241 265 367 448 489 529 611 692 855 20% Risk ($) 136 145 158 185 171 180 188 201 214 227 240 258 284 392 479 523 566 653 740 914 4% HST ($) 35 37 41 48 44 46 48 52 55 59 62 66 73 101 123 135 146 168 191 235 4% 60%
Notes 1 Expected Life from GENIVAR (RWS). 2 Construction unit costs from HRM's 2007 Database (excluding on-costs), with build up (assuming installation costs are 60% of the supply costs, fill is $183 per m, and excavation is $62 per m) and a 2% indexing per year. 3 Assume average storm dia is 900mm and depth equals 2.5m.
Overhead Total Unit ($) Cost ($/m) 34 36 39 46 43 45 47 50 54 57 60 65 71 98 120 131 142 163 185 229 884 946 1,025 1,202 1,112 1,168 1,225 1,310 1,395 1,479 1,564 1,677 1,847 2,554 3,120 3,402 3,685 4,251 4,816 5,948
Breakdown of Storm Sewers Decade 1950 - 59 1960 - 69 1970 - 79 1980 - 89 1990 - 99 2000 - 09 Total Length (km) 24 55 118 197 197 197 788 Replacement Cost $k 36,967 86,256 184,834 308,057 308,057 308,057 1,232,227
January 9, 2013
Page 888
Revision Number 5
Page 17 of 34
Table S.2 - Culverts

On-Cost Multipliers 23% Diameter (mm) 450 525 600 750 900 1,050 1,200 1,350 1,500 1,800 450 500 550 600 650 700 750 800 900 1,000 1,050 1,200 Unit Cost On-cost ($) ($/m) 2 706 714 825 963 1,102 1,195 1,287 1,657 2,027 2,397 1,519 1,567 1,631 1,695 1,759 1,823 1,887 2,032 1,951 2,112 2,192 2,272 162 164 190 222 253 275 296 381 466 551 349 360 375 390 405 419 434 467 449 486 504 522 20% Risk ($) Concrete 174 176 203 237 271 294 317 408 499 590 HDPE 374 386 401 417 433 449 464 500 480 519 539 559 45 45 52 61 70 76 82 105 128 152 96 99 103 107 111 115 120 129 124 134 139 144 43 44 51 59 68 74 79 102 125 148 94 96 100 104 108 112 116 125 120 130 135 140 1,131 1,143 1,320 1,542 1,764 1,913 2,061 2,653 3,245 3,838 2,432 2,509 2,612 2,714 2,817 2,919 3,022 3,252 3,124 3,380 3,509 3,637 4% HST ($) 4% 60% Overhead Total Unit ($) Costs ($/m)
Breakdown of Culverts Dia (mm) 450 525 600 750 900 1,050 1,200 1,500 1,800 2,100 Total Length km Total Cost($k) 1.35 1,531 0.12 136 3.33 4,405 0.91 1,405 0.69 1,223 0.50 948 0.39 796 0.32 1,043 0.67 2,571 0.16 622 8.45 14,680
Notes 1 Assume average 900mm dia of culverts, 20m culvert crossing, approximation. 2.5m dept to bottom of bedding, 1:1 Construction with no trench box, 0.5m between pipe and trench walls, and 0.3m bedding. Includes headwall, traffic control, env. protection, and restoration. 2 Unit construction costs from the 2007 HRM unit rate with build up costs (assuming installation costs are 85% of supply costs (conc.) and 45% (HDPE), fill is $183 per m and excavation is $62 per m).
3 For the asset renewal model, it was assumed that culverts will get replaced with concrete culverts.
Revision Number 5
Table S.3 - Stormwater Structures (Culvert Replacement)
Capacity (m3) 3700 190 9900 430 36000 12 5300 35600 55600 20 300 270 13800 244000 172000 44,000 19500 3200 9,400 15,300 5,000 2,000 9,000 550 160 108 80 130 60,000
Page 18 of 34
Name Oceanview Drive Retention Pond Meadowbrook Retention Pond Transom Drive Retention Pond Glenbourne Estates Retention Pond Parkland Avenue Retention Pond Glen Forest Weir / Retention Pond Lacewood Retention Pond Susie Lake Control Structure Volvo West Retention Pond Old Sambro Road Retention Pond Graystone Road Retention Pond Tamarack Drive Retention Pond Heritage Hills Retention Pond Clement Street Retention Pond Maynard Lake Dam Sullivans Pond Culvert Shubie Drive Retention Pond Countryview Drive Retention Pond Commodore Drive Retention Pond Lemlair Row Retention Pond Forest Hills Retention Pond Cole Harbour Commons Retention Pond Guysborough Retention Pond John Stewart Dr Retention Pond Stewart Harris Drive Retention Pond Cranberry Lake Retention Pond Gregory Drive Retention Pond Main Street Retention Pond Kuhn Marsh Dam Notes
Type of Structure Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond Retention basin, dam and spillway Concrete Sluice gate. Drains to Pond RetentionBlack Duck Retention Pond Retention Pond Retention Pond Retention Pond Control Gates Pipe and Gate Grated inlet to Culvert Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond Timber Headwall and Culvert Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond Retention Pond and Dam
Year of Estimated Replacement Cost Constructio ($) 1 n 1990 1980 2007 1990 1990 1960 1970 1989 1990 1980 1980 1990 1998 1979 1960 1971 2007 2006 2006 2006 1980 2007 1979 2005 1978 1980 2003 1980 2008 Total 98,040 80,520
less than 50 yrs at the end of IRP
105,840 76,080 96,960 141,660 n/a n/a 26,400 no purpose n/a

70,560 less than 50 yrs at the end of IRP n/a
n/a n/a (it is a dam)

less than 50 yrs at the end of IRP less than 50 yrs at the end of IRP less than 50 yrs at the end of IRP less than 50 yrs at the end of IRP
61,680
105,840
116,880 41,220
22,620
1,044,300 1 Estimated Replacement Costs from culvert replacement only (for more information go to Tab '" SW structure Culvert Calc.) n/a This indicated2013 stormwater structre is greater then 50 years at the end of the IRP, however there are compoents much as a dam, a the January 9, concrete gate, control gates that require indivual investigation Revision Number 5
Page 890
From Alec's System Value Summary v2 Water Transmission 4.95E+08
217.1267 km Data and Assumptions Replacement Cost Calculation 2013 Metric size Size 375 375 375 375 600 600 600 600 375 685 685 675 675 675 675 675 675 675 675 400 600 400 500 500 375 375 600 450 500 600 600 600 600 300 600 600 600 500 600 300 600 400 400 750 600 600 400 400 400 300 375 375 375 375 600 600 600 600 375 27 27 675 675 675 675 675 675 675 675 400 600 400 20 500 375 375 600 450 500 600 600 600 600 300 600 600 600 500 600 300 600 400 400 750 600 600 400 400 400 300 Material CI CI CI CI CI CI CI CI CI CI CI CI CI CI CI CI CI CI CI 0 CI 0 CI CI CI CI CI CI CI CI CI CI CI 0 0 0 CI CI 0 0 HY HY CI CI HY HY HY HY HY DI Date 1856 1856 1856 1856 1862 1862 1862 1862 1862 1892 1892 1892 1892 1892 1892 1892 1892 1892 1892 1893 1893 1906 1913 1913 1913 1913 1922 1940 1942 1942 1942 1942 1942 1951 1952 1952 1952 1952 1960 1960 1962 1962 1962 1963 1963 1963 1964 1964 1964 1964 Length km 1.17 1.395 1.5 1.5 1.17 0.4 1.03 1.5 0.605 1.165 0.49 1.065 0.37 0.213 0.04 0.955 0.119 0.233 0.455 0.43 1.865 0.37 0.53 0.395 1.73 1.26 0.99 1.705 0.41 0.23 0.128 1.042 0.12 0.8 2.087 1.35 1.03 0.61 1.13 0.59 1.49 0.105 0.595 0.17 0.4 0.455 0.96 1.49 1.69 1.47 Unit Replace Cost $ perRate $/m Age Unit rate $ per km m 1634.512 1634512 1634.512 1634512 1634.512 1634512 1634.512 1634512 1917.87 1917870 1917.87 1917870 1917.87 1917870 1917.87 1917870 1634.512 1634512 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 2412.546 2412546 1634.512 1634512 1917.87 1917870 1634.512 1634512 1776.991 1776991 1776.991 1776991 1634.512 1634512 1634.512 1634512 1917.87 1917870 1704.951 1704951 1776.991 1776991 1917.87 1917870 1917.87 1917870 1917.87 1917870 1917.87 1917870 1493.633 1493633 1917.87 1917870 1917.87 1917870 1917.87 1917870 1776.991 1776991 1917.87 1917870 1493.633 1493633 1917.87 1917870 1917.87 1917870 1917.87 1917870 2553.425 2553425 1917.87 1917870 1917.87 1917870 1634.512 1634512 1634.512 1634512 1634.512 1634512 1493.633 1493633 157 157 157 157 151 151 151 151 151 121 121 121 121 121 121 121 121 121 121 120 120 107 100 100 100 100 91 73 71 71 71 71 71 62 61 61 61 61 53 53 51 51 51 50 50 50 49 49 49 49 75 yrs Expected Life
January 9, 2013
Page 891
400 750 400 300 750 750 750 400 400 400 600 350 600 600 600 600 600 600 400 600 600 600 600 600 500 500 900 500 600 600 400 500 400 600 400 600 600 400 400 400 900 400 400 600 600 400 600 400 600 600 750 750 750 750 750 500 900 750 750 1500 1350
400 750 400 300 750 750 750 400 400 400 600 350 600 600 600 600 600 600 400 600 600 600 600 600 500 500 900 500 600 600 400 500 400 600 400 600 600 400 400 400 900 400 400 600 600 400 600 400 600 600 750 750 750 750 750 500 900 30 750 1500 1350
0 HY DI DI HY HY HY DI DI AC HY CI 0 HY HY HY HY HY 0 HY HY 0 0 0 0 HY HY DI HY 0 DI CI CI 0 0 HY DI HY HY/DI DI HY DI CI HY 0 DI HY 0 DI SS HY HY HY HY HY CI HY HPC HY HY HY
1965 1965 1965 1966 1966 1966 1966 1966 1966 1967 1968 1969 1969 1969 1969 1969 1969 1969 1969 1969 1969 1970 1970 1970 1971 1971 1971 1971 1971 1971 1971 1972 1972 1972 1972 1972 1972 1973 1973 1973 1973 1973 1974 1974 1974 1974 1974 1974 1974 1974 1975 1975 1975 1975 1975 1975 1975 1975 1975 1976 1976
0.59 0.2847 0.87 0.55 1.46 0.27 1.38 0.81 2.63 0.95 0.645 1.02 0.63 0.69 1.88 1.2 1.04 0.31 1.02 0.55 0.099 1.96 1.05 2.16 0.81 1.29 1.98 1.08 1.31 0.64 1.261 1.33 0.52 0.62 1.27 0.215 1.06 1.55 1.48 1.27 0.685 1.942 1.4 1.03 0.41 1.71 1.49 1.085 0.63 1.15 2.07 0.61 0.39 0.16 0.83 0.165 1.33 0.745 0.77 8.2 2.25
1634.512 2553.425 1634.512 1493.633 2553.425 2553.425 2553.425 1634.512 1634.512 1634.512 1917.87 1493.633 1917.87 1917.87 1917.87 1917.87 1917.87 1917.87 1634.512 1917.87 1917.87 1917.87 1917.87 1917.87 1776.991 1776.991 2836.783 1776.991 1917.87 1917.87 1634.512 1776.991 1634.512 1917.87 1634.512 1917.87 1917.87 1634.512 1634.512 1634.512 2836.783 1634.512 1634.512 1917.87 1917.87 1634.512 1917.87 1634.512 1917.87 1917.87 2553.425 2553.425 2553.425 2553.425 2553.425 1776.991 2836.783 2553.425 2553.425 5806.44 4674.608
1634512 2553425 1634512 1493633 2553425 2553425 2553425 1634512 1634512 1634512 1917870 1493633 1917870 1917870 1917870 1917870 1917870 1917870 1634512 1917870 1917870 1917870 1917870 1917870 1776991 1776991 2836783 1776991 1917870 1917870 1634512 1776991 1634512 1917870 1634512 1917870 1917870 1634512 1634512 1634512 2836783 1634512 1634512 1917870 1917870 1634512 1917870 1634512 1917870 1917870 2553425 2553425 2553425 2553425 2553425 1776991 2836783 2553425 2553425 5806440 4674608
48 48 48 47 47 47 47 47 47 46 45 44 44 44 44 44 44 44 44 44 44 43 43 43 42 42 42 42 42 42 42 41 41 41 41 41 41 40 40 40 40 40 39 39 39 39 39 39 39 39 38 38 38 38 38 38 38 38 38 37 37
cohort split
January 9, 2013
Page 892
1200 1200 1200 1200 900 500 500 350 600 1200 1200 1200 1200 400 900 400 600 900 900 900 900 900 900 600 600 900 450 350 400 500 500 750 750 750 900 900 900 500 750 750 750 750 750 400 675 400 400 400 750 400 400 750 400 600 600 750 400 400 400 350 600
1200 1200 1200 1200 900 20 500 350 600 1200 1200 1200 1200 400 900 400 600 900 900 900 900 900 900 600 600 900 450 350 400 20 500 750 750 750 900 900 900 500 750 750 750 750 750 400 675 400 400 400 750 400 400 750 400 600 600 750 16 400 400 350 600
HY HY HY HY HY HPC HY CI HY HY HY HY HY DI HY DI DI HY HY HY HY HY HY CI 0 HY CI 0 DI DI DI HY HY HY HY HY HY DI HY HY HY HY HY DI SS DI DI DI HY 0 0 DI DI DI 0 DI DI DI DI 0 0
1976 1976 1976 1976 1976 1976 1976 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1977 1978 1978 1978 1982 1982 1985 1985 1985 1986 1986 1986 1986 1986 1986 1986 1986 1986 1986 1986 1986 1988 1988 1989 1989 1989 1989 1990 1990 1990 1990 1991 1991 1991 1991 1991 1991 1992 1992
1.65 1.52 3.41 3.62 1.05 0.05 0.045 0.79 1.43 0.85 1.94 1.02 1.26 1.35 1 0.411 0.225 1.13 1.51 0.41 0.04 1.7 0.41 2.99 1.15 0.87 4.2 2.24 0.08 0.22 0.205 0.27 0.24 0.34 0.14 0.48 0.32 0.33 0.67 1.285 0.5 0.08 0.15 1.35 0.041 0.3 1.13 1.31 0.52 1.41 0.76 1.738 0.37 0.35 0.64 2.05 0.475 0.15 0.303 2.26 0.78
3826.135 3826.135 3826.135 3826.135 2836.783 1776.991 1776.991 1493.633 1917.87 3826.135 3826.135 3826.135 3826.135 1634.512 2836.783 1634.512 1917.87 2836.783 2836.783 2836.783 2836.783 2836.783 2836.783 1917.87 1917.87 2836.783 1704.951 1493.633 1634.512 1776.991 1776.991 2553.425 2553.425 2553.425 2836.783 2836.783 2836.783 1776.991 2553.425 2553.425 2553.425 2553.425 2553.425 1634.512 2412.546 1634.512 1634.512 1634.512 2553.425 1634.512 1634.512 2553.425 1634.512 1917.87 1917.87 2553.425 1634.512 1634.512 1634.512 1493.633 1917.87
3826135 3826135 3826135 3826135 2836783 1776991 1776991 1493633 1917870 3826135 3826135 3826135 3826135 1634512 2836783 1634512 1917870 2836783 2836783 2836783 2836783 2836783 2836783 1917870 1917870 2836783 1704951 1493633 1634512 1776991 1776991 2553425 2553425 2553425 2836783 2836783 2836783 1776991 2553425 2553425 2553425 2553425 2553425 1634512 2412546 1634512 1634512 1634512 2553425 1634512 1634512 2553425 1634512 1917870 1917870 2553425 1634512 1634512 1634512 1493633 1917870
37 37 37 37 37 37 37 36 36 36 36 36 36 36 36 36 36 36 36 36 36 36 36 35 35 35 31 31 28 28 28 27 27 27 27 27 27 27 27 27 27 27 27 25 25 24 24 24 24 23 23 23 23 22 22 22 22 22 22 21 21
January 9, 2013
Page 893
400 500 400 400 500 400 350 600 750 750 600 400 600 1050 1050 1050 900 600 450 350 400 400 750 400 400 400 600 500 400 400 400 400 600 750 750
400 500 400 400 500 400 350 600 750 750 600 400 600 1050 1050 1050 900 600 450 350 400 400 750 400 400 400 600 500 400 400 400 400 600 750 750
0 0 DI PVC 0 DI DI DI 0 0 DI PVC 0 HY HY HY HY 0 DI DI DI DI DI DI DI DI DI Sliplined HDPE DI DI CI DI DI DI DI
1992 1993 1993 1993 1994 1994 1994 1994 1994 1995 1995 1996 1997 1998 1998 1998 1998 1998 1999 2000 2000 2000 2001 2002 2002 2003 2003 2003 2004 2005 2006 2006 2007 2008 2009
1.32 1.94 0.2 0.153 0.505 1.56 1.3 0.97 0.071 2.38 1.64 7 1.235 4.23 1.2 0.58 0.52 0.23 3.07 3.65 0.74 0.521 0.235 0.97 1.415 0.21 0.04 0.475 0.77 0.42 0.95 0.88 1.5 0.45 0.49
1634.512 1776.991 1634.512 1634.512 1776.991 1634.512 1493.633 1917.87 2553.425 2553.425 1917.87 1634.512 1917.87 3544.378 3544.378 3544.378 2836.783 1917.87 1704.951 1493.633 1634.512 1634.512 2553.425 1634.512 1634.512 1634.512 1917.87 1776.991 1634.512 1634.512 1634.512 1634.512 1917.87 2553.425 2553.425
1634512 1776991 1634512 1634512 1776991 1634512 1493633 1917870 2553425 2553425 1917870 1634512 1917870 3544378 3544378 3544378 2836783 1917870 1704951 1493633 1634512 1634512 2553425 1634512 1634512 1634512 1917870 1776991 1634512 1634512 1634512 1634512 1917870 2553425 2553425 Total $k
21 20 20 20 19 19 19 19 19 18 18 17 16 15 15 15 15 15 14 13 13 13 12 11 11 10 10 10 9 8 7 7 6 5 4
January 9, 2013
Page 894
Value on 2011 Insurance Water Robie Street No. 1 Water Rockmanor Water Titus & Evans Chain Control PRV Water Sackville MacDonald Bridge PRV Water Robie Street No. 2 Bluewater Road PRV Water Zinck Avenue Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water West - Robie Street Central Central, Zinck Avenue Akerley Blvd. PRV Albro Lake PRV Alder Crescent PRV Ambercrest Drive PRV Atholea Drive PRV Beaver Bank PRV Belmont Avenue PRV Bi Centennial Hwy PRV Birch Cove PRV Braeburn Road PRV Bridgeview PRV Broadholme Lane PRV Caldwell Road PRV Chandler Drive PRV Coleridge Court PRV Duke St. PRV Elmwood Avenue PRV Esson Road PRV Everett Street PRV Farnham Gate Road PRV Flamingo Drive No. 1 PRV Flamingo Drive No. 2 PRV Florence Street PRV Forest Hill Drive PRV Frederick Lane PRV West - Robie Street Central - Rock Manor West - Titus & Evans Ave Central B $ 1,283,940.00 $ $ 534,975.00 $ $ 427,980.00 $ West PRV Chamber $ 320,985.00 $ West - MacDonald PRV Chamber Bridge $ 267,487.50 $ PRV Chamber $ 213,990.00 $ East East Central - Alder Crescent Central, Ambercrest Drive East - Atholea Beaver Bank East Central West - Birchcove West - Braeburn West - Bridgeview West Broadholme Lane East Central East - Coleridge Central East - Elmwood Avenue East - Esson East, Everette West Farnham Gate West Flamingo Drive West Flamingo Drive Central Florence Street West - Forest Hill Drive Central Frederick Lane PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Station 1,283,940 534,975 427,980 320,985 320,985 267,488 267,488 213,990 213,990 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493
2012 Cost with 2% inflation
Asset Type
1,309,619 PRV 545,675 PRV 436,540 PRV 327,405 PRV 327,405 PRV 272,837 PRV 272,837 PRV 218,270 PRV 218,270 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 163,702 163,702 163,702 163,702 163,702 163,702 PRV PRV PRV PRV PRV PRV PRV
PRV Chamber PRV Chamber PRV Chamber PRV Chamber
163,702 PRV 163,702 163,702 163,702 163,702 PRV PRV PRV PRV
PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber
163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV
January 9, 2013
Page 895
Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Portland Water Pratt and Whitney Water Prince Albert Water Princess Margaret Water Raymond Water Renfrew Water Ritcey Crescent Water Riverside Water Ross Road PRV
Giles Road PRV Glenforest Drive PRV Golf View Drive PRV Gordon Avenue PRV Hazelholme Drive PRV Hebridean Drive PRV Lake Drive PRV Lakeside Control Chamber Larry Uteck Boulevard PRV Leaman Drive PRV Lennox Drive PRV Lucasville Road PRV McLennan Avenue PRV Magee Drive PRV Meadowbrook Drive PRV Melody Drive PRV MicMac Boulevard PRV Mount Edward Road PRV Newcastle Street PRV Peerless PRV Pinehill Drive PRV East Bennery East - Prince Albert Road East - Princess Margaret Blvd Central Raymond Drive East - Renfrew Street East - Ritcey Crescent Central - Riverside Drive East - Ross Road
Central West Glenforest West East - Gordon Avenue West Hazelholme West Central - Lake Lakeside/Timberle Larry Uteck Blvd East Lennox Drive Lucasville Road West - McLennan Avenue Central - Magee Central West - Melody East - MicMac Boulevard PRV Chamber East - Newcastle Street Central - Peerless Central - Pinehill Insurer Copy
160,493 PRV Chamber 160,493 160,493 PRV Chamber PRV Chamber PRV Chamber PRV Station PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber PRV Chamber 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 PRV Chamber PRV Chamber PRV Chamber $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493
163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV
January 9, 2013
Page 896
Water Skyridge Water Starboard Water Tacoma Water View Royale Drive Water Village Road Water Waverley Water Waverley Water Williams Water Withrod Water Wright Water Wyse Road PRV Water
Central - Skyridge Ave Central-Starboard Drive East - Tacoma Drive West West PRV Chamber East - Waverley Road West West - Withrod Drive East - Wright Avenue East - Wyse Road Lancaster Drive Emergency PRV Dunbrack St north of Main St PRV Douglas Drive PRV Oakmount Drive PRV West West West
$ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $ $ 160,492.50 $
160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 160,493 106,995 101,900 53,498 53,498 53,498 53,498
163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 163,702 PRV 109,135 PRV 103,938 PRV 54,567 PRV 54,567 PRV 54,567 PRV 54,567 PRV
Water Water Water Radcliffe Water St. Paul's
Dunbrack St PRV Station north of Main St Central PRV Chamber Douglas Drive Central PRV Chamber Oakmount Drive $ 53,497.50 $ $ 53,497.50 $
January 9, 2013
Page 897
Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Water Preston Water Robie Street Meter Water South Park Street Water Summer Water White Hills Meter Water Young Water Water Water Water Water Water Water Surge Relieve Valve Water Water Water Water Water Water Water Water Water Topsail Water Water
Eastern Passage Meter Gaston Road Meter Jaybe Drive Meter Kaye Street Meter Lakeside Meter Bilby Street Meter Chestnut Lane Meter Cobequid Road Meter Herring Cove Road Meter Hollis Street Meter Kingswood Meter McLaughlin Drive Meter Mount Edward Road East Meter Chamber Mount Edward Road West Control Chamber Oakwood Avenue Meter West West - Robie Street West - South Park Street West - Summer Street Central West - Young Street Bennery Meter Chamber Kearney Lake Rd Meter Chamber Flynn Park Meter Blue Mountain Meter Lucasville Road Meter Hammond Kearney Meter Near Aerotech STP Bell Boulevard Check Valve Chamber Barnes Drive Check Valve Chamber Hemlock Control Chamber Lyle Street Control Chamber Main No. 2 Control Chamber Main No. 1 Control Chamber Mount Edward Road Control Chamber Orchard Control Chamber East - Topsail Drive Cowie Hill Road PRV Kearney Control
East - Eastern Passage East East - Jaybe West - Kaye West West - Bilby Street East - Chestnut Central West West - Hollis Central East - McLaughlin Drive Meter Chamber Meter Chamber East - Oakwood Avenue
Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber
53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498
54,567 Meter Chamber 54,567 54,567 54,567 54,567 54,567 54,567 54,567 54,567 54,567 54,567 Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber
Meter Chamber Meter Chamber Meter Chamber
54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 54,567 Meter Chamber 109,135 Meter Chamber 163,702 Meter Chamber 218,270 Meter Chamber 272,837 Meter Chamber 763,944 Meter Chamber Water Surge 218,270 Relieve Valve Chamber Check Valve 54,567 Chamber Check Valve 54,567 Chamber 818,512 Control Chamber 818,512 Control Chamber 654,809 Control Chamber 1,746,158 Control Chamber 436,540 Control Chamber 654,809 Control Chamber 436,540 Control Chamber 873,079 Control Chamber 436,540 Control Station
Meter Chamber $ 53,497.50 $ $ 53,497.50 $ $ 53,497.50 $ $ 53,497.50 $ $ 53,497.50 $ $ 53,497.50 $
53,498 53,498 53,498 53,498 53,498 53,498 53,498 53,498
Bennery Kearney Lake Rd West - Flynn Central - Blue Mountain Lucasville Rd Central
Meter Chamber Meter Chamber Meter Chamber Meter Chamber Meter Chamber
106,995 160,493 213,990 267,488 748,965
$ 213,990.00 $ Bennery Bennery/Aerotech Central Lyle Street West West Control Chamber Orchard Control Chamber $ 427,980.00 $ West - Cowie Hill Road Kearney Control Chamber PRV Station Control Chamber Control Chamber
213,990 53,498 53,498 802,463 802,463 641,970 1,711,920 427,980 641,970 427,980 855,960 427,980
January 9, 2013
Page 898
Unit Cost Summary September 6_1
2011 Insurance Renewal Values
$802,463 $534,975 $427,980 $427,980 $427,980 $101,900 $427,980 $427,980 $160,493 $427,980 $34,773 $1,069,950 $427,980 $641,970 $267,488 $320,985 $534,975 $427,980
NAME Airport Fire Pumping Station (HIAA) Bennery Lake / Aerotech Pumping Station Beaverbank Pumping Station Bedford South Pumping Station Bedford Village Pumping Station Crestview Pumping Station Eaglewood Pumping Station Lively Booster Station No. 7 Highway Pumping Station Silverside Pumping Station Upper Hammonds Plains Pumping Station Lyle Street Control Chamber Mount Edward Pumping Station Charles Road Pumping Station Cowie Reservoir Pumping Station Leiblin Pumping Station Parkdale Pumping Station Robie Street Emerg. Pump. Station St. Margarets Bay Road Pumping Station
CONSTRUCTION YEAR PUMP CAPACITY 1960 2 fire pumps, 1@2000 USgpm, 1@1000 USgpm 1986 1 fire pump, 1@5000 USgpm 1999 2 reservoir feed pumps, 2@1170 USgpm 3 domestic pumps, 1@165 USgpm, 2@360 2004 USgpm, 1 fire pump 1@1500 USgpm 3 domestic pumps, 1@110 USgpm, 2@270 1990 USgpm, 1 fire pump 1@2500 USgpm 3 domestic pumps, 1@89 USgpm, 2@195 USgpm, 1994 no fire pump 1984 2 domestic pumps, 2@10 USgpm, no fire pump 2008 2 domestic pumps, 2@47.5 USgpm, no fire pump 2 domestic pumps, 2@375 USgpm, 1 fire pump 1975 1@1000 USgpm 1983 3 domestic pumps, 1@70 USgpm, 2@160 USgpm 1999 2 domestic pumps, 2@200 USgpm, no fire pump 1991 1 emergency pump, 1@1667 USgpm 3 domestic pumps, 1@340 USgpm, 2@650 2004 USgpm, 1 fire pump 1@2000 USgpm 3 domestic pumps, 1@175 USgpm, 2@385 1996 USgpm, no fire pump 1975 2 domestic pumps, 2@870 USgpm, no fire pump 2 domestic pumps, 2@282 USgpm, 1 fire pump 1966 1@1500 USgpm 2 domestic pumps, 2@160 USgpm, 1 fire pump 1984 1@1000 USgpm 1990 1 emergency pump, 1@5000 USgpm 2008 2 reservoir feed pumps, 2@600 USgpm
Page 27 C:\Users\WilliaV\AppData\Local\Temp\XPgrpwise\Unit Cost Summary September 6_1

Table W.9 -Service Reservoirs
Reservoir Name & Elevation Steel, C- Concrete)
(S -
Capacity (ML)
Insurance Renewal Values ($ 2012) 1,2 12,223,109 436,540
Total Reservoir Cost ($k) 19,556,974 698,463 9,191,778 7,920,574 436,540 698,463 873,079 5,867,092 8,556,176 3,492,317 436,540 8,730,792 8,730,792 21,023,747 523,848 3,492,317 5,238,475 873,079 7,822,790 349,232 12,712,033 436,540 1,309,620 436,540 698,463 4,365,396 4,583,666 436,540
Geizer 158 (S) Res Chamber Geizer 123 (C) (int) Ext Reservoir Meter Reservoir Chamber Dump Valve Control Chamber Cowie (C) Robie ( C) Lakeside/Timberlea (C) Res Chamber Mount Edward 1 (C) Mount Edward 2 (S) Akerley Blvd. (S) Res Chamber North Preston (S) Meadowbrook ( C) Res Chamber Sampson (S) Res Chamber Stokil (S) Res Chamber Waverley ( S) Res Chamber Middle Musquodoboit (C) Aerotech (S) Beaver Bank (S) Res Chamber
36.4
31.8
5,744,861 4,950,359 272,838 436,540 545,675
Total Steel Tanks $86,478,498 Total Concrete Tanks $53,013,371 Grand Total $139,491,869
11.4 15.9 5.4
3,666,933 5,347,610 2,182,698 272,838
22.7 22.7 37.7
5,456,745 5,456,745 13,139,842 327,405
1.6 9.1
2,182,698 3,274,047 545,675
12.2
4,889,244 218,270
23.6
7,945,021 272,838
1.3
818,512 272,838
0.3 4.1 6.9
436,540 2,728,373 2,864,791 272,838
Notes 1 Construction cost based on HW 2011 Insurance Renewal values with additional 2% for indexing. 2 Construction costs exclude land acquisition, and all off site costs.
January 9, 2013
Page 900
Reed Steel Calculations
REED Steel Reservoir Costs

9,000,000 8,000,000 7,000,000 6,000,000
y = 204242x + 273336 R = 1
Cost $
5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0
10
15
Reed - Steel
20 Capacity ML
25
30
35
40
Linear (Reed - Steel)
Reservoir Mount Edward 1 Cowie Hill Geizer 123 Lakeside/Timberlea Meadowbrook Middle Musquodoboit Robie Street
Capacity (ML) 22.7 11.4 31.8 5.4 9.1 0.3 15.9
Cost Equation (y($)=204242x(ML)+ 273336) With 1.6 Multiplier $4,909,629 $2,601,695 $6,768,232 $1,376,243 $2,131,938 $334,609 $3,520,784 $7,855,407 $4,162,712 $10,829,171 $2,201,988 $3,411,101 $535,374 $5,633,254
Cost ($k) for Steel Reservoir Replacement $7,855 $4,163 $10,829 $2,202 $3,411 $535 $5,633
January 9, 2013
Page 901
Monument <47hp
Monument / Building HW name Horse power (hp) 1 1 1.2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 3 3 3 3 3 3 3 3 3 3 3 3 3 4 4 4 4 4 4 4 4 4 5 5 5 5 5 5 5 5 7 7 7 7 7 7 Use White Street Sewage Pumping Station 341 Pleasant St., Dartmouth Sewage Pumping Station 8 Wellington Dr, Wellington Pumping Station 8 Balsom Road, Bedford Pumping Station Belmont Street, Dartmouth SPT/WTP Craigburn Court Sewage Pumping Station Crichton Ave Sewage Pumping Station 171 Greenwood Ave, Timberlea Pumping Station Mason Street Sewage Pumping Station 31 Meadowlands Pk. Dr., Sackville Pumping Station 20 B Plymouth Road Sewage Pumping Station Lakecrest Dr.@ Ashley Dr. Sackville Pumping Station Lot 49-A, 292 Tucker Lake Road Sewage Pumping Station 1180 Cole Harbour Rd, Cole Harbour Pumping Station 16 Maitland St. Dartmouth Pumping Station 90 Maplewood Cres, Cole Harbour Pumping Station 16A Thorncrest CRT, Eastern Passage Pumping Station Timberlea Sewer Pumping Station Golf View PVR 25 B Craigburn Drive Sewage Pumping Station 72 Governors Lake Dr, Timberlea 11B Killarney Dr., Bedford 49 Shore Rd 85 Mowat Cresc., Sackville Oathill Lake Park 32 White Birch Lane, Dartmouth 21 Megan Cresc., Sackville 439 Lakeview Ave., Sackville 245 Lakeview Ave., Sackville 188 Lakeview Ave., Sackville Atlantic St Adjacent to 143 Cavelier Dr. 313 Lockview Rd., Fall River 1479 Fall River Rd., Fall River 407 Lockview Rd., Fall River 11 B Sprucewood Court Settle Lake Park Twilight Lane 12B Odell Dr. Westphal Bruce Street 84 Everette St Pinehaven Dr, Halifax Auburn Ave (Civic: 31 Hilden Rd) Colpit Lake Red Maple Dr., Timberlea 224 Springfield Lake Rd., Galloway Dr, Beaver Bank 113 Lockview Rd., Fall River Barkley Near 833 Lakeview Ave, Sackville 99 Lakeview Ave., Sackville Springfield Lake Rd., Sackville 1205 Downey Rd, North Preston Pumping Station Sewage Lift Station Pumping Station/Park Sewage Pumping Station Sewage Pumping Station Sewage Pumping Station Pumping Station Pumping Station Pumping Station Pumping Station Sewage Pumping Station Pumping Station Pumping Station Pumping Station Pumping Station Sewage Pumping Station Sewage Pumping Station Sewage Pumping Station Pumping Station Sewage Pumping Station Sewage Pumping Station Pumping Station 2 Pumps 2 Pumps Pumping Station Pumping Station Pumping Station Pumping Station 2 Pumps Pumping Station Pumping Station Pumping Station Pumping Station Location Greatest Value (when comparing 2010 Insurance Value vs. HW Generic Value) 100,000 100,000 262,500 262,500 787,500 262,500 100,000 262,500 100,000 262,500 525,000 262,500 262,500 100,000 100,000 100,000 262,500 404,250 262,500 262,500 262,500 262,500 262,500 262,500 262,500 157,500 262,500 262,500 262,500 262,500 262,500 262,500 262,500 262,500 262,500 100,000 262,500 100,000 100,000 100,000 262,500 262,500 100,000 262,500 262,500 262,500 262,500 262,500 100,000 525,000 262,500 262,500 100,000 2010 Value $21,000 $42,000 $262,500 $262,500 $787,500 $262,500 $52,500 $262,500 $52,500 $262,500 $525,000 $262,500 $262,500 $34,125 $34,125 $34,125 $262,500 $404,250 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $157,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $78,750 $262,500 $63,000 $34,125 $52,500 $262,500 $262,500 $72,185 $262,500 $262,500 $262,500 $262,500 $262,500 $63,000 $525,000 $262,500 $262,500 $34,125 HW Generic Value 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
162 168 119 23 34 47 50 70 96 97 114 138 156 44 92 95 153 26 38 48 69 81 89 103 106 161 139 142 144 145 18 41 59 57 60 148 150 128 107 39 56 113 20 45 123 137 66 58 24 136 146 147 11
White Street Woodside Family Centre PS at Wellington WWTF Balsam Road Belmont Avenue Craigburn Court Crichton Avenue Greenwood Avenue Mason Street Meadowlands (Churchill) Plymouth Road Springfield Lake #11 Tucker Lake Cole Harbour Road Maitland Street Maplewood Drive Thorncrest Court Bay Road Brook Street Craigburn Drive Governors Glen Killarney Drive Lions Club Mowat Crescent Oathill Crescent White Birch Lane Springfield Lake #12 Springfield Lake #4 Springfield Lake #6 Springfield Lake #7 Atlantic Street Cavalier Drive Fall River #3 Fall River #1 Fall River #4 Sprucewood Court Stuart Harris Drive Rocklin Court O'Dell Drive Bruce Street Everette Street Pinehaven Road Auburn Avenue Colpitt Lake Rd Red Maple Drive Springfield Lake #10 Galloway Drive Fall River #2 Barclay Avenue Springfield Lake #1 Springfield Lake #8 Springfield Lake #9 Amos Walter Drive
M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M
January 9, 2013
Page 902
149 5 141 79 125 143 134 9 15 33 133 32 120 159 167 140 3 166 40 31 102 6 7 67 46 108 80 82 91 151 152 163 165 105 37 75 84 90 158 104 10 115 171 117 132 21 19 4 87 94 169 170 8 51 36
Stratford Drive Ahmadi Court Springfield Lake #3 Judy Anne Court Reserve Road Springfield Lake #5 Simmonds Road Allison Drive Armenia Drive Bedford Yacht Club Shore Drive Beckfoot Drive Punch Bowl Drive Wenlock Grove Woodcrest Avenue Springfield Lake #2 800 Waverley Road Windmill Road Caldwell Road Beaver Crescent Mount Hope Avenue Akerley at Windmill Akerley Boulevard Extension Gaston Road Costco Old Ferry Road Kearney Lake Road King Street Main Street Susie Lake Crescent Symonds Road Wilkinson Avenue Willowdale Terrace North Preston Road Bluewater Road Iris Avenue Lakeland#2 Long Pond Waterfront Drive North Green Road Amelia Court Point Pleasant Drive York Lane PS at Middle Musquodoboit WWFT Shipyard Road Autoport Attwood Crescent Aerotech Drive Larry Uteck (temp PS) Mann Street Woodside Ferry Terminal (North) Woodside Ferry Terminal (South) Alderney Gate Dartmouth City Hall Bissett Road Depot
M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M IB IB IB IB IB
7 8 8 9 9 9 9 9 10 10 10 10 10 10 10 10 10 10 10 15 18 20 20 20 30 35 47 30 30 29 10 10 10 9 7 5 5 5 5 3 3 3 3 2 2 30 2 5 10 1 1 8 1 2
39 Stratford Dr, Cole Harbour 77 Ahmadi Cres, Bedford 538 Lakeview Ave., Sackville Judy Ann Crt, Sackville Reserve Road 330 Lakeview Ave., Sackville 112A Simmonds Rd, North Preston Allison Dr. Cole Harbour 95 Armenia Dr, Bedford 73 Shore Road, Bedford 66A Golf Links Rd, Bedford 38 Beckfoot Drive, Dartmouth Punchbowl Drive Wenlock Wood Crest 656 Lakeview Ave., Sackville 800 Waverley Road Windmill Road 734 Caldwell Rd, Cole Harbour 2A Beaver Cres, Cole Harbour 1 Mount Hope Avenue Akerley Blvd. 134 Akerley Blvd Ext. Gaston Road Bicentennial HWY, Chain Lake Drive Old Ferry Rd Bicentennial HWY, Halifax 130 Alderney Drive 6 Golf View Drive 90 Susie Lake Crescent 530 Hammonds Plains Rd 625 Wilkinson Avenue 10 Birchview Drive 851 North Preston Road 246 Bluewater Road 20 Iris Avenue 153 Lakeland Street 815 Herring Cove Road 79 Waterfront Drive 80 North Green Road 17 Amelia Court 5599 Point Pleasant Dr 48 York Lane 7805 Highway 357 16 Shipyard Road 1151 Main Road 34 Attwood Crescent 199 Aerotech Drive 79 Mann Street Woodside Ferry Terminal Woodside Ferry Terminal 88 Alderney Drive 90 Alderney Drive 213 Bissett Road
Pumping Station Pumping Station Pumping Station Pumping Station 2 Pumps Pumping Station Pumping Station Pumping Station Pumping Station Pumping Station Pumping Station Sewage Pumping Station 2 Pumps 2 Pumps 2 Pumps Pumping Station Sewage Pumping Station Sewage Pumping Station Pumping Station Pumping Station Sewage Pumping Station Sewage Pumping Station Sewage Pumping Stn. Sewage Pumping Station 2 Pumps/Pumping Station Sewage Pumping Station 1 Pump/Puming Station
Sewage Pumping Station 9 Atlantic Street Pumping Station
262,500 262,500 262,500 262,500 262,500 262,500 100,000 262,500 262,500 262,500 262,500 262,500 262,500 262,500 100,000 262,500 262,500 100,000 262,500 262,500 262,500 262,500 262,500 262,500 262,500 1,050,000 500,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
$262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $34,125 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $84,000 $262,500 $262,500 $73,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $262,500 $1,050,000 $262,500
100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 Insurance value includes CSO 500,000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000
use $100k
100000
use $100k use $100k

$84,000 $210,000 100,000 100000 100,000 use $100k 100000 100000
Average
214,345
January 9, 2013
Page 903
Building < 35hp

Monument / Building HW name Horse power 20 20 5 10 10 20 8 20 10 5 15 5 20 7 23 20 9 5 15 15 8 10 20 30 30 30 20 20 15 15 12 10 10 8 4 Location Use Greatest Value (when comparing 2010 Insurance Value vs. HW Generic Value) 787,500 787,500 787,500 787,500 787,500 500,000 500,000 787,500 500,000 500,000 500,000 500,000 500,000 500,000 787,500 500,000 500,000 500,000 1,644,609 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 2010 Value $787,500 $787,500 $787,500 $787,500 $787,500 $52,500 $262,500 $787,500 $175,387 $262,500 $168,000 $262,500 $262,500 $262,500 $787,500 $262,500 $262,500 $84,000 $1,644,609 $262,500 $262,500 $262,500 $362,250 $210,000 $262,500 $262,500 HW Generic Value 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500000 500000 500000 500000 500000 500000 500000 500000 500000
12 13 22 28 30 43 49 62 88 71 77 83 54 111 124 135 155 126 42 74 116 109 129 100 17 85 157 86 110 172 154 65 78 160 130
Anderson Street Armcrest Balcombe Drive Beaver Bank #2 Beaver Bank #5 Chandler Drive Crescent Avenue First Lake Drive Leiblin Drive Hartlen Point Jaybe Drive Lakeland#1 Donald Lane Pennington Dr. Regatta Point South East Passage Trinity Lane Riverwood Drive Chain Rock Drive (Balmoral) Humber Park PS at Aerotech Park WWTF Old Lawrencetown Road Rosewood Avenue Memorial Drive Atikian Drive Lakeridge Crescent Village Road Lakeside Park Avenue Young Street Transom Drive Freshwater Trail John Savage Whimsical Lake Russell Lake
B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B B
3 Anderson St Sewage Pumping Stat./Water Trtmt/Park 15 Taleen Dr., Sackville Sewage Pumping Station 1 Ferndale Dr, Halifax 2 Pumps 1240 Beaverbank Rd, Beaverbank Rd. Pumping Station 4 Pinehaven Dr, Beaver Bank Pumping Station Glendale Dr, Sackville Sewage Pumping Station Halifax 2 PumpsPumping Station 1A Kingfisher Way, Sackville Sewage Pumping Station 108 Lieblin Park Dr., Halifax 2 Pumps Shore Rd, Eastern Passage Pumping Station John Brenton Drive Sewage Pumping Station 163 Lakeland St., Beaver Bank Pumping Station Johnson Road Sewage Pumping Building Pennington Dr, Beaver Bank Pumping Station 28 Armshore Dr, Halifax Pumps and Diesel gen. 2019 Shore Rd. Pumping Station 136 Trinity Way, Beaver Bank Pumping Station 1 White Birch Dr, parcel X Pumping Station 5908 Chain Rock Drive Pumping Station 49 Gander Ave, Westphal Pumping Station 449 Aerotech Dr., Goffs Pumping Station 33 Old Lawrencetown Rd, Westphal Pumping Station 16 Rosewood Avenue Pumping Station Dartmouth Sewage Treatment Plant/Pumping Station Melrose Cres, Eastern Passage Pumping Station 30 Lakeridge Cres, Cole Harbour Pumping Station 242 Village Road 1447 St. Margarets Bay Rd 2 Park Avenue 3101 Barrington Street 96 Transom Drive 171 Freshwater Trail 183 John Savage Avenue 65 Inverness Avenue 69 Baker Drive
Average
590,203
Building 36hp to 99hp

Monument / Building HW name Horse power 47 40 40 47 47 47 47 40 40 75 75 60 70 Location 998 Beaverbank Rd., Beaver Bank 16 Sherwood St, Cole Harbour 67 Parkhill Rd, Halifax 49 Majestic Ave, Beaver Bank Melville Cove Prospect Rd, Halifax Twin City Air Relief, Chamber 1 200 Waverley Road 390 Waverley Road 118 Chain Lake Dr, Halifax 205 Waterfront Dr, Bedford 1516 Shore Rd, Eastern Passage 50 Hollyhock Way Use Greatest Value (when comparing 2010 Insurance Value vs. HW Generic Value) 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,050,000 1,000,000 1,575,000 1,050,000 1,000,000 1,000,000 2010 Value $262,500 $262,500 $787,500 $262,500 $787,500 $787,500 $262,500 $1,050,000 $787,500 $1,575,000 $1,050,000 $34,125 HW Generic Value 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1000000
29 131 53 93 99 122 61 1 2 27 118 121 73
Beaver Bank #3 Sherwood Street Dingle Majestic Avenue Melville Cove Ragged Lake Farmers 192 Waverley Road 390 Waverley Road Bayers Lake PS at Mill Cove WWTF Quigley's Corner Hollyhock
B B B B B B B B B B B B B
Pumping Station Sewer Pumping Station/Waste Water Treatment Pumping Station Pumping Station Pump Station Pumping Station--Commerical Sewage Lift Station Sewage Pumping Station Work Bldng. And Pump Stn Pumping Station Pumping Station Pumping Station
Average
1,051,923
January 9, 2013
Page 904
Building >100hp (current range is 100 to 300hp)

Monument / Building HW name Horse power 100 300 135 215 175 120 230 200 150 200 300 200 150 Location Dutch Village Rd 5211 Duffus Street, Halifax 1473 Bedford Hwy., Bedford 47 Portland Estates Blvd Princeton Ave, Halifax 140 Alderney Dr., Dartmouth Williams Lake Road Francklyn St, Halifax 54A Attwood Cres, Cole Harbour 127 Village Road 2 Jamieson Street 986 Barrington Street 23 Melva Street Use 4 Pumps 6 pumps, P Station Pumping Station Sewage Pumping Station 4 Pumps/pumping station Pumping Station Pumping Station Pumping Station Pumping Station Greatest Value (when comparing 2010 Insurance Value vs. HW Generic Value) 2,000,000 2,598,312 2,100,000 2,000,000 3,675,000 2,000,000 2,000,000 3,843,827 2,100,000 2,000,000 2,000,000 2,000,000 2,000,000 2010 Value $1,365,000 $2,598,312 $2,100,000 $262,500 $3,675,000 $34,125 $787,500 $3,843,827 $2,100,000 HW Generic Value 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2000000 2000000 2000000 2000000
14 55 63 101 127 52 164 16 35 72 76 112 98
Armdale Rotary Duffus Street Fish Hatchery Park Morris Lake Roach's Pond Dartmouth Cove Williams Lake Road AST (Atlantic School of Theology) Bissett Lake Herring Cove Jamieson Street Pier A Melva Street
B B B B B B B B B B B B B
Average
2,332,088
64 Fishermans View 68 Goudey Drive 25 Barnes Drive Northcliffe Lane
Not yet with HW B - not owned by HW M - not owned by HW M - now decommissioned
30 142 Goudey Drive
3 635 Barnes Drive

2 Northcliffe 2 Pumps
January 9, 2013
Page 905
Replacement of Culverts
Cost for Inlet Culvert(s)
Name Oceanview Drive Retention Pond Meadowbrook Retention Pond Glenbourne Estates Retention Pond Parkland Avenue Retention Pond Glen Forest Weir / Retention Pond Lacewood Retention Pond Old Sambro Road Retention Pond Tamarack Drive Retention Pond Forest Hills Retention Pond Guysborough Retention Pond Stewart Harris Drive Retention Pond Cranberry Lake Retention Pond Main Street Retention Pond age to replace (at 50 years) Inlet Three inlet culverts (two PVC 0.3m dia, and one conc. 0,6m) Two inlet steel culvert 0.4m in dia. Outlet One 0.6m diameter oncrete culvert # dia (mm) unit cost ($/m) Total #
Cost of Outlet Culvert(s)

dia (mm) unit cost ($/m) Total TOTAL Cost for Culvert Replacement
Assume 20m culvert crossing
20
2040 2030 2040 2040 2015 2020 2030 2040 2030 2029 2028 2030 2030
2 1 2 2 1 2 2 1 1 1 1 1 3 2 1 1
300 600 400 900 750 450 900 1500 600 900 900 600 900 300 600 1200
1131 1320 1131 1764 1542 1131 1764 3245 1320 1764 1764 1320
$45,240 $26,400 $45,240 $70,560 $30,840 $45,240 $70,560 $64,900 $26,400 $35,280 $35,280 $26,400
1 1 1
600 900 900
1320 1764 1764
$26,400 $35,280 $ $35,280 $ $
$98,040 80,520 105,840 76,080 96,960 141,660 26,400 70,560 61,680 $105,840 116,880 41,220 22,620
Outlet concrete box culvert (1.2m by 0.6m) cost at 0.9m dia One outlet culvert (assume 0.9m Two inlet culverts (assume 0.9m dia) conc.) Three concrete culvert inlet pipes (0.75m, 0.45m, and 045m in dia) Two inlet concrete culverts with a 0.6m diameter Inlet concrete culvert 1.5m dia, concrete overflow wall One concrete inlet culvert 0.6m dia One conc inlet culvert 0.9m in dia Two conc culverts 0.9m and 0.6m in diameter Three inlet culverts (assume 0.9m dia) Two 0.3m and one 0.6m dia concrete culverts One concrete culvert 1.2 diameter Intake structure Control Weir Control weir in a box culvert that flows into a 0.6m concrete pipe Concrete outlet culvert 1.8m, concrete overflow wall 0.6m opening to allow for flow One conc inlet culvert 0.9m in dia with concrete wall and PVC elbo Berm One outlet structure Two 0.3m diameter steel pipes that will be replaced by conc. Culverts Marshy area One concrete culvert 0.4m in dia
1 1
600 1800
1320 3838
$26,400 $ $76,760 $ $
900
1764
$35,280 $ $
1764 $105,840 1131 $45,240 1320 2061 $26,400 $41,220
300
1131
$45,240 $ $ $22,620 $
400
1131
Structures that are too younge to be replaced during IRP

Name Transom Drive Retention Pond Heritage Hills Retention Pond Shubie Drive Retention Pond Countryview Drive Retention Pond Commodore Drive Retention Pond Lemlair Row Retention Pond Cole Harbour Commons Retention Pond John Stewart Dr Retention Pond Gregory Drive Retention Pond Kuhn Marsh Dam
Structures that need to be investigated more for cost estimates
Name Susie Lake Control Structure Volvo West Retention Pond
in fin modelClement Street Retention Pond

Maynard Lake Dam Sullivans Pond Culvert (it is more of a Dam)
2039 Cearth berm and conrete dam 2040 control gate with stop log control, vacuum relief air vent 2029 Earthen berm, culvert, gate, and asphalt overflow 2010 concrete outlet structure with control gate 2021 Dam
Purpose Unknown
Name Graystone Road Retention Pond
2030
Catch basin located within a fenced in area, there appears to be no purpose for the structure
Assumptions culverts are 20m long replacement is done at 50 years replacement is done with a conc. Culvert
January 9, 2013
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APPENDIX 11A
AECOM 3292 Production Way Burnaby, BC, Canada V5A 4R4 www.nationalbenchmarking.ca
604 444 4600 604 294 8597
tel fax
September 5th, 2012 Halifax Water PO Box 8388, RPO CSC Halifax, NS B3K 5M2
File: 04001300 4001.51769.002
Attention: Mr. Carl D. Yates, M.A.Sc., P.Eng., General Manager Dear Mr. Yates: Re: National Water and Wastewater Benchmarking Initiative Proposal Following up from our recent discussions, I have provided some background information and pricing information regarding the National Water and Wastewater Benchmarking Initiative. All of this information is extracted from the general proposal which I sent you earlier. (More information can be found on the project website: www.nationalbenchmarking.ca.) 1. Introduction
AECOM and the National Water and Wastewater Benchmarking Initiative participants have been successfully benchmarking municipal water, wastewater and, stormwater utility operations since 1998. Having started with four wastewater utility participants in 1998, the partnership has grown to include about 45 of Canadas most progressive municipal and regional water, wastewater, and stormwater utilities from coast to coast. Internationally the project is considered one of the leading public sector benchmarking projects of its kind in the world today, and water sector organizations from afar a field as Malaysia, South Africa, United Arab Emirates, and Europe are looking at the project as an example of a highly successful benchmarking initiative. 2. Benchmarking Program
The partnership has become a highly-experienced association of public utilities that are proficient at metric benchmarking. The success in metric benchmarking has now facilitates the introduction of a broad range of process benchmarking opportunities through the NWWBI partnership. We are obtaining high quality data in all areas of utility goal attainment, and the original strategic management models that were designed in the initial stages of the project have stood the test of time and continue to provide the context that we need to assess performance. Moving forward requires a focused effort on using the Benchmarking data more proactively for performance improvement. In order to support these advancing needs, the strategic direction of the project for 2012-13 will therefore focus on the following: Data quality remains the absolute foundation for this project. An important foundation of this project is the accuracy and consistency of the performance measurement data. For Halifax Water, this process will include specially trained AECOM staff to assist with data
Halifax 2012_Letter_Sept2012.Doc
Page 2
collection. This process will include a site visit, plus direct assistance in gathering, compiling, and tabulating the necessary utility related data. Data collection includes gathering the specific data, the source documentation, reviewing the results, and correcting errors or omissions. Data to be collected will be based upon the selected performance measures and their specific definitions as determined in the preceding workshops. We will assist participating municipalities in implementing continuous improvement in a proactive manner. This will include fostering collaboration between participants, including Case Studies and implementation results in the annual Summary Workshop and making data and information readily accessible through the project website. The Help Desk service, where we customize performance data to suit individual purposes, will continue to be a high value added service available for all participants. We will continue to tie the Benchmarking Management Model and outcomes to best practices, make specific recommendations on best practices where applicable, and strive to keep the best practice compendium up to date with the most current industry practices. The annual National Benchmarking Summary workshop will continue to be a vital component of the project, whereby all benchmarking participants can leverage from each others progress, exchange ideas, and implement proven best management practices. This workshop will normally be conducted in the spring of each year. Process Benchmarking Task Forces will continue under their individual terms of reference and under the direction of the utility participants. The Region is welcome to participate in any of the Task Forces it chooses. Current process benchmarking task forces include: o o Water and wastewater treatment plant maintenance planning optimization Linear network maintenance planning (Wastewater Collection, Water Distribution, and stormwater drainage) Pump station maintenance planning Inflow and Infiltration management Water/Sewer network condition assessment Financial management and rates planning Water loss management
o o o o o
We will continue to build strategic alliances with other leading continuous improvement organizations such as the NRC, AWWA, WEF, IWA, AWWA, CWWA, OMBI, and others to assist participants to get the maximum value from other programs.
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Page 3
3.
Benefits
Some of the many benefits to be achieved by participating in the Benchmarking Partnership are as follows: An established group that provides for productive peer-to-peer relationships and open communication where everyone is working towards common goals. Performance measures aligned with triple bottom line reporting techniques. Identification of opportunities to improve performance, and the identification of Best Practices. Participants can clearly see where they perform well, and what areas to focus on for improvement. An invaluable tool for communicating to Council and other stakeholders on how your utility performed in a peer-to-peer comparison of utilities across Canada. A commitment by all participants to continuous improvement ensures full co-operation of the participants, as everyone is working towards common goals. Facilitated workshops and discussions to identify management and functional level process improvements that increase efficiency and effectiveness, and save money. Quality leadership AECOM provides a broad depth of International and Canadian experience in addition to unequaled experience in the field of public utility Benchmarking. 4. Project Deliverables
The annual project deliverables will include the following: All workbooks, issue papers, templates and management tools associated with the project. Full access to all best practice results, such as those arising from process benchmarking task forces. Attendance at the annual Summary Workshop. Attendance at the Specialty Task Force Meetings (usually held in the fall of each year). All proceedings for the entire year of benchmarking are organized and placed on a CD ROM. The content can be accessed through a user-friendly graphical dashboard that enables easy access to the full content of the annual results. While the requirements and priorities of the participants will guide the final content and format of the CD ROM, the following is the typical base of the content: o o o Benchmarking Summary Report Grouped benchmarking results for all utilities Customized Min, Max, Median graphs and personalized radar graphs that pertain to your utility
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Page 4
Complete proceedings from the Summary Workshop, including all presentations and session minutes. A full Participant Directory that includes a listing of all participating utilities, contact names, telephone numbers, and email addresses for key individuals in each utility. A copy of the Benchmarking Roadmap and the Roadmap Compendium that documents the full range of metric and process benchmarking Best Practices. Results and progress of all Process Task Forces to enable each participants Continuous Improvement efforts. Each Task Force will set its own scope and objectives, based upon the needs of the Task Force Membership Updated Water and Sewer Rate Compendium, which includes Canadas most detailed and comprehensive comparison of water and sewer rates and financial strategies. Updated version of the Benchmarking database in MS Access format. The databases contain data for all participating municipalities since the inception of the project. The benchmarking database is developed to allow participants (in a user-friendly manner and with limited database skills) to retrieve a wide range of reports from the database to be used to develop their own results, trend lines, or to make comparisons with other utilities
All of the content noted above plus all of the detailed Task Force results are also maintained and stored in the Members Only section of the Benchmarking project website. Participating municipalities will receive an account name and password to access the site on an unlimited basis: (www.nationalbenchmarking.ca). 5. Project Schedule
The project iteration has an annual cycle with the following key project milestones. While the milestone dates have not been set for 2013-14, they will closely align with the 2012-13 dates as follows: July 1st, 2012 Project iteration kick-off (revised data sheets, etc.) October 31 , 2012 First Deadline to complete first draft aspects of data collection (this will be conducted in close association with AECOM data collection staff). December 16th 2012 Draft performance results circulated to all benchmarking participants. February 22, 2013 Second deadline to complete second update of data collection (this will be conducted in close association with AECOM data collection staff). April2nd -5th, 2013 Summary Workshop for National Water and Wastewater Benchmarking participants in Vancouver, BC. June 15 2013 Project iteration conclusion and CD ROM is produced.
th st
January 9, 2013
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Page 5
6.
Project Fees
AECOM charges an all inclusive flat fee for participation in benchmarking (Please see the proposal Section 9). Fees are based on the extent of the infrastructure being benchmarked (eg: water distribution, wastewater collection, water treatment plants, wastewater treatment plants, etc.). As well, discounts are offered if your municipality participates in two or three of the utility modules (wastewater, water, and stormwater). This fee includes participation in the Annual Summary workshop as well as the Process Task Force Specialty Workshops. Full details regarding the fees and discount programs are detailed in Section 9 of the full proposal. Final project fees have not been set for the 2013-14 iteration but the following fee estimate is based upon our discussions, recent e-mail correspondence and the current 2012-13 fee schedule. AECOM endeavors to keep NWWBI fees as stable as possible and in fact fees for this iteration have not changed in three years. The table below is provided to give you an estimate, but AECOM reserves the right to increase fees by more no more than 5% following the review of the final 2012-13 project accounting. The final guaranteed fee estimate will be proved to you before May 31, 2013.
Schedule of Fees: Halifax Water (for Water (3 WTPs), Wastewater (7 WWTPs) and Stormwater) Wastewater Utility $ 7,200 $ 7,200 $ 6,300 $ 14,000 $ 4,000 $ 34,700 $ $ $ 5,205 29,495 29,495 Water Utility Storm Water Utility $ 7,200 $ 8,200 $ 7,200 $ 6,300 $ 7,000 $ $ $ $ $ 27,700 4,155 23,545 23,545 60,010 $ $ $ $ 8,200 1,230 6,970 6,970
Base Contribution For All Participants* Pipe system Treatment First plant (in each of water and wastewater) Next 3 plants total ( water and wastewater) Remaining plants total (wastewater) Sub-Total
*Population >100,000
Less Discount for Multi-Program (15%) Sub-Total Total 2012-2013 (Excluding Tax) Total
In the case of benchmarking three plants in the water utility (and the distribution system), seven plants in the wastewater utility (and the collection system), and the stormwater system, the project fee for the current iteration of the NWWBI would be $60,010.00 (plus HST). The fee for the 2013-14 iteration will be between this amount and $63,010.50 (reflecting the possibility of a rate increase of no more than 5%). The project fee is all inclusive of AECOM staff time and expenses related to project costs, and travel disbursement to participate in data collection site meetings and project orientation workshops with utility staff, etc. The fee also includes attendance for Water Utility staff in the Benchmarking Summary Workshop, (but does not include their personal travel and accommodation expenses). The project fee can be billed in a single installment or in three approximately equal installments, as follows: 35% of fees at commencement of the project 35% of fees at 50% completion of the project (December 1st, 2013) 30% of fees at completion of the project (June 10th , 2014)
Page 6
7.
Information Exchange and Confidentiality
The results of the benchmarking process are used within the group for the sole purpose of individual utility and participant group performance improvement and education. As such, the results of the process are Commercial Confidential and are not shared outside of the confines of the participant group. Participants are required to keep the databases and the Project Summary Report confidential to their organization. In situations where an organization wishes to publicly review their performance in comparison with other utilities individually, or with the entire group, the organization is required to blind the results so that individual utilities cannot be identified by name. 8. Conclusion
Over the next year, we are looking forward to assisting you with performance improvement implementations based on the outcomes the benchmarking efforts, past workshops, your task force participation, and on your personalized benchmarking results. Thank you for your interest in this groundbreaking project.
Sincerely, AECOM Canada Ltd.
David Main Senior Project Manager

Encl.
January 9, 2013
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APPENDIX 11B
Introduction to the National Water and Wastewater Benchmarking Initiative

David Main, Project Director
David.main@aecom.com
January 9, 2013
Page 913
Suggested Agenda
Project Review Project Mechanics (how it works) NWWBI Outputs Using NWWBI to assist utility management Questions/discussion
January 9, 2013
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Brief Project History

Began in 1998 as Canadian Wastewater Benchmarking Expanded in 2000 with addition of Ontario CAO Initiative Benchmarking Study Expanded in 2000 to include Water Utilities and renamed the NWWBI Expanded to include Stormwater in 2003 Halifax Regional Municipality participated in WW and SW: 2001 2004
Participation is National in Scope
January 9, 2013
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What is our definition of Benchmarking?

How well are we doing? How well do we compare? Are we producing value for money? How can we improve?
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Todays Utility Challenges

Customer expectations for service are rising Water and Sewer regulations are becoming increasingly stringent requiring additional resources Liability issues are growing Moving into the era of infrastructure renewal Current political climate is focusing on zero increase at a difficult time
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NWWBI Objective
Enables the ability to communicate with facts and numbers
Prioritize areas for internal improvement Communicate operational results for internal staff Senior management can understand and quantify most aspects of utility operations Educate and inform Regulatory Board on utility programs and results AND where current needs and priorities are Educate and inform customers about utility levels of service expectations in exchange for fair rates.
January 9, 2013
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Benchmarking Module Structure

WATER
Water treatment Filtered Unfiltered Water distribution Transmission Distribution
WASTEWATER
Wastewater collection Trunk Collection Wastewater treatment Primary Secondary Tertiary
STORMWATER & DRAINAGE

January 9, 2013
Stormwater Drainage Stormwater Retention & Treatment

Page 920
Methodology
Utility Management Model
Annual Review
Goals
Performance Measures
Data Collection
Data Analysis and Evaluation Closing Workshops Report & Database Action Plans
January 9, 2013
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Utility Management Model

Critical Utility Reporting Levels: Most utilities have 4 including Owners
OWNERS/POLITICIANS
Reports
KEY INDICATORS
MANAGEMENT LEVEL Utility Manager
Utility Cost Compliance Utility Productivity Customer Service
We focus on the Managers Level This allows us to drill into lower levels for Process Benchmarking
Reports
INTERMEDIATE LEVEL Division Superintendant
BUSINESS UNIT: -Cost -Compliance -Productivity -System Throughput -Work Attainment -Work Backlog -Customer service
Reports
FUNCTIONAL LEVEL Foreman/Lead Hand
ACTIVITY: -Cost -Compliance -Productivity -System Throughput -Work Attainment -Work Backlog -Customer service
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We Measure Attainment of the Following Seven Core Goals

1. Provide Service Reliability 2. Provide Sufficient Service Capacity 3. Meet Service Requirements with Economic Efficiency 4. Protect Public Health and Safety 5. Provide a Safe and Productive Workplace 6. Have Satisfied and Informed Customers 7. Protect the Environment (Water, Land, and Air)
Six goals compete for resources and funding

1.Ensure service reliability 1. Meet ALL service requirements with economic efficiency 2.Provide adequate capacity 3.Ensure public health 4.Ensure a safe workplace 5.Protect the environment 6.Ensure customer satisfaction
NWWBI provides the means to measure the attainment of each goal

- Using performance indicators that measure attainment of each goal - About 70 individual performance measures
January 9, 2013
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Example PM: Definition Detail

Sum of the actual O&M costs incurred in the operation of
the distribution/transmission/ integrated system (excludes capital costs, indirect costs, transfers to reserves and debt/interest charges). Includes O&M costs for both linear (pipes, meters etc) and non-linear (pump stations, reservoirs etc) infrastructure. Revenues are only included where they are recoveries for work done by water distribution staff that is extraneous to the utility (for example, lab tests for other utilities).
Total Operations & Maintenance Cost / km Length of Distribution system
Total length of mains in the distribution system (i.e.
Detailed are vital to ensure valid comparisons
excluding length of service connections). For the distribution system length include all connecting pipes between pump stations, rechlorination facilities and storage facilities if these are located within the distribution system. For the transmission system length include all connecting pipes between pump stations, rechlorination facilities and storage facilities when located between the source and the treatment plant or between the definitions treatment plant and the distribution system.
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Example Output Chart: Target Group Graph

Provide Reliable Service and Infrastructure - 2 # of Blocked Sewers / 100km Length Due to Different Causes 2010
Wastewater Collection Systems 12 unknown structure poor hydraulics debris grease roots
unknown: 4.3 structure: 0 poor hydraulics: 0 debris: 3.7 grease: 17.7 unknown: 0.52 structure: 0.41 poor hydraulics: 0 debris: 6.3
10
# of Blocked Sewers / 100km Length
0
RMOH DMR DWV BRA ROP DEL CRIC MAR REG THU BAR LON CWAT CVER ROD DNV KAM RED BUR ABB SAS HAM WPG EDM CAL WHI CHI KEL PG
Negative Values - no data available X-axis - in order of increasing length
Shows detail regarding the entire group Useful for making quick multi-agency comparisons
Example Output Chart: Min, Max, Median Graph

Provide Reliable Service and Infrastructure 1
# of Blocked Sewers / 100 km Length

Wastewater Collection Systems 0 Minimum 0 0.8 26.3 30.5 Maximum 27.8 2.3 2.9 2.9 2.7 2.8 6.4 5.0 CAL City X 4.1 6.1 6.9 0 5 10 15 20 25 30 35 32.4 31.2 0.5 0.9
2010 2009 2008 2007 2006
Median
Useful for examining one agencys result in more detail Multi-year trend line is of key importance Tends to grade against the median, instead of a target.
Example Output Chart: Radar Chart

Select your city
City of Abbotsford Example Utility Wastewater Collection Systems
Quartile Charts
Pipes O&M Cost* $0.77
Max 75% 50% 25%
.
Overall Radar Chart

System Reliability 100% 80% 60% Satisfied Customers 40% 20% 0% Sufficient Capacity
77.7%
2010 City Results 2009 City Results
Summary view: Does this reflect that nature of the system and the desired outcomes? Measure the approximate level of service to the cost of providing service
Min
* Pipes O&M cost ('000) / km length
93.5%
98.1%
Sewer Cost* $171.00

Max 75% 50% 25%
.
Workplace
Min
86.1%
Environmental Stewardship
94.5%
* Sewer Cost for a Typical Size Residential Connection using 250 m/year Quartile Charts show in which quarter your utility falls
Data Labels for 2010 WW Collection Results
January 9, 2013
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In All Cases:
Benchmarking results are only a start; You need to look behind the graph; NWWBI graphs are not blinded, so you can clearly see which utility is leading; Only by discussing the results and getting more information can you begin to identify specific process changes.
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Benchmarking. So what!
Must learn to use the data as a tool to manage and guide the selection of strategies; Strategies usually requires a utility to change, which is always hard; Use benchmarking to monitor strategies. NWWBI project provides guidance on all of the above
January 9, 2013
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NWWBI Network and Workshops

The NWWBI network has been vital to success Project includes annual workshop to debrief results Key to success is that we now have the same glossary along comparable Since results are not blinded, it opens the door to sharing of ideas and practices We start to answer How do I improve?
January 9, 2013
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Support Continuous Improvement: Process Task Forces

1. Identify process related issues 2. Refine performance measures 3. Identify related Best Practice sources 4. Set a specific Action Plan. 5. Network with experts and peers
January 9, 2013
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Strong Reputation for Technical Merit

2nd Year in a row, NWWBI practices are being presented at WEFTEC featuring industry-leading Best Practices Featured at the 2012 and 2013 WEF/AWWA Utility Management Conference CSA looks to NWWBI as a key stakeholder:
Technical Guide: Performance Improvement for Small & Medium Sized Water Utilities Technical Guide: Visual Inspection of Sewer Pipe
Academic Collaboration
National Research Council University of North Carolina Environmental Finance Research Centre
January 9, 2013
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Public Works/ Water Sector Awards

Management Innovation Award: American Public Work Association: 2003 Recipient of the 2012 Water Canadas Waters Next award for industry leadership
January 9, 2013
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The Way Forward

Benchmarking is become part of standard practices (improved data management processes); Set realistic targets, with specific work plans. Focus on best opportunities first. Steady progress as opposed to a radical change program. Communication is more important than ever.
January 9, 2013
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Ultimately Objective:
Maintenance Planning
An entire sector of critical public infrastructure working as a team to improve the quality and efficiency of Canada's water services.
M Rai an nw ag at em er en t Co Wate nse r Str rva ate tion gie s

Bene fic Reu ial se
d an w on lo rati f In filt In
Maintenance Management
t et en ss m A ge ing a n an n M Pla
Biosoli ds Mgmt.
Ensure Adequate Capacity Protect Public Health
Reliability of Service
Minimum Sustainable Cost
Advanced Filtration
king Drin uality Q ater W t Mgm
Protect the Environment Have Satisfied Customers
Le a Tr de ai rs ni hi ng p
or rat pe ning O ai Tr
Safe and Productive Workplace
Re S Re ten taf cr tio f ui n tm an en d t
Acc Red ident uc t i on
v ic er Le erv Custom n S tio Educa
te Sou Man r Loss agem Con rce ent trol A BN Tr dva Ra ea nc Tre nd T t m ed en atm ert ne of t en iary fi St t De els e o
Safe t Train y ing
January 9, 2013
Tr ea O pt Pl tm an en im iz t t at io n
Tr rm ea w tm ate en r t
SO io C uct ed n
on si es ng cc ni Su Plan
ially a nc e Fin ainabl ust tes S Ra
Energy Reduction Green House Gas Reduction

Wa
Page 937
Questions?
Detailed information can be found at: www.nationalbenchmarking.ca Public Report, Performance Measures Index, and detailed glossaries are available at
http://www.nationalbenchmarking.ca/public/docs/Public%20Report%202009.pdf
January 9, 2013
Page 938
APPENDIX 11C
THE CANADIAN NATIONAL WATER AND WASTEWATER BENCHMARKING INITIATIVE: USING PROCESS TO DRIVE IMPROVEMENT
Strategic Management of Water in Urban Areas D. Main*, L. Ng**, A. North***
*David Main, 1901 Rosser Avenue 6 Floor, Burnaby, BC V5C 6S3 Canada, david.main@aecom.com th **Leslie Ng, 1901 Rosser Avenue 6 Floor, Burnaby, BC V5C 6S3 Canada, leslie.ng@aecom.com.ca ***Andy North, 47620 UEP Subang Jaya, Selangor Darul Ehsan, Malaysia andy.north@aecom.com.ca Abstract AECOM has been successfully benchmarking Canadian municipal water, wastewater and stormwater utility operations since 1997. While the fundamental purpose of this project was metric benchmarking for the purpose of making performance comparisons to guide continuous improvement, the project is now serving as a dynamic platform to consider, examine, and implement a broad range of utility best practices that have resulted in superior performance where they have been implemented. The keys to success however were based more on a process that emphasizes communication, teamwork and collaboration rather than the trend to push computerized data management systems to their fullest potential, and most importantly in recognizing the importance of hard work. With these success factors now well understood and documented, it is feasible to benchmark almost any public infrastructure amongst agencies that are willing, regardless of their level of technological development. Finally by sharing this methodology, the performance measure descriptions and detailed definitions, it is also feasible to make international comparisons in a simple and cost effective manner, thus opening the door to the broad exchange of international best practices. Keywords: Benchmarking, Continuous Improvement, Performance Measurement, Asset Management.
th
Introduction
In 1997, a group of four municipal wastewater utilities, AECOM Canada, Inc, and the National Research Council of Canada met with the purpose of looking for a framework to answer four seemingly simple questions that had been posed by each of the utilitys boards: How well are we doing?; How do we compare with similar organizations?; Are we getting value for money?; and How can we get better at what we do? Benchmarking, defined as the continuous process of measuring products, services and practices against the toughest competitors or those companies recognized as industry
IWA Publishing 2006. Published by IWA Publishing, London, UK.
January 9, 2013
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Book title
leaders was pioneered by Robert C. Camp at the Xerox Corporation in the 1970s. Because of its widespread use in all leading corporations through the 1990s, it was agreed that benchmarking could be effectively utilized to provide the answer to these important questions. What seemed straightforward and intuitive through many Best Practice publications, was in fact very challenging. The difficulty appeared once the practice was recommended for use in the public sector. In the private sector, competition results in ruthless selection of the fittest. Whereas virtually all private sector corporations ultimately roll all performance metrics into only one final performance measure (total return to shareholders as measured by profit and shareholder equity); public agencies have always had a much broader set of objectives, including performance on social, environmental, as well as financial matters. Benchmarking was assumed to be a well documented process, but in fact had to be redesigned from the ground up in order to develop a management process that reflected the attainment of goals that by definition will always compete with one another (for example, improved environmental performance will be at the expense of bottom line financial results). An extensive literature search showed that benchmarking in the public sector had been conducted in the past, even within the municipal water and wastewater utility industry. Further analysis however, showed that past exercises tended to be short lived, usually terminating after one or two iterations. Only in exceptional cases, has benchmarking appeared to deliver remotely satisfactory results. Weaknesses within all examined examples included: Inability to provide accurate and comparable data; Lack of agreement regarding what to measure; Lack of patience within participants to optimise the benchmarking process; and Few if any tangible improvements in participating organizations. By focusing efforts at the early stage of the project on each of the above, the National Water and Wastewater Benchmarking Initiative was able to design a robust methodology for conducting metric benchmarking within the public sector successfully and continuously. The project has found success not only in its fundamental purpose of metric benchmarking, but also as a dynamic platform to consider, examine, and implement a broad range of utility best practices that have resulted in superior performance. As well, the project has developed into a highly effective network of peers from which to share and exchange ideas about utility management. What is Benchmarking? (And More Importantly, What is it Not?) In some circumstances, benchmarking has become another in a long list of management buzzwords that have been promoted as a single strategic management cure-all. It is not. In fact, if all you do is benchmarking, then there is no value to the process whatsoever. Benchmarking must be utilized in association with a coordinated series of management and operational actions that produce change. If you agree, however, that you cannot improve what you do not measure, then benchmarking is an essential part of a strategic management framework. As shown in Figure 1, this was affirmed by Boston-based Bain Consultings annual Management Tools & Trends Bain & Co. (2003) survey of the most effective strategic management processes used by more than 700 global companies over the past 9 years. According to Bain & Co., Strategic Planning (used by 89% of firms), was followed by Benchmarking, (used by 84% of firms), as the most effective of all management tools. "They are your basic management tool kit Bain & Co. (2003).
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Process to Drive Performance

Top Management Tools 2003 in Terms of Corporate Usage - Bain & Co.
Strategic Planning Benchmarking Mission and Vision Statements Customer Segmentation Outsourcing Customer Surveys Customer Relationship Management Corporate Code of Ethics Growth Strategies Pay-for-Performance Core Competencies Contingency Planning Strategic Alliances Change Management Programs Knowledge Management Balanced Scorecard Downsizing Total Quality Management Reengineering Supply Chain Integration Economic Value-Added Analysis Activity Based Management Merger Integration Teams Corporate Venturing Stock Buybacks 18% 32% 37% 64% 62% 62% 59% 57% 54% 52% 52% 50% 70% 69% 79% 78% 78% 78% 78% 76% 76% 75% 84% 84% 89%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Figure 1 Most Effective Management Processes: 2003
For the National Water and Wastewater Benchmarking Initiative (NWWBI), benchmarking encompasses regular annual comparisons regarding the attainment of common goals for the purpose of identifying performance gaps. Equally important is implementing the improvements, monitoring the progress, and reviewing the benefits of the implemented changes. What differentiates this program from the traditional consultancy-lead private sector programs aimed at competitor analysis is that the NWWBI has been undertaken collaboratively, through the willing sharing of performance data, to learn about the circumstances and processes that underpin superior performance. In tandem with this, is the realization that no single organization has all the answers, and that success is measured through a wide range of criteria that may include financial-; sustainability-; reliability-; environmental- and customer service criteria. Participation is National in Scope Launched in 1997 as a pilot project that included four participating cities as well as team members from AECOM (as the Program Manager) and the National Research Council for technical advice, the Benchmarking Initiative has grown to the point where it serves as a national standard. Today, the National Water and Wastewater Benchmarking Initiative include 37 of Canada's leading municipal and regional utilities. The partnership now represents the Canadian urban centres that account for over 60% of Canadas population. This wide participation base is not without its challenges. Canada is the second largest country in the world. It spans 4 time zones, and includes climates that range from near Mediterranean to Arctic (including permafrost). In terms of precipitation, it ranges from desert to temperate rain forest. In the past, comparisons amongst such a diverse base were discounted. But by taking local factors that may affect cost, performance, or the selection of practices into account in the methodology, participants are rewarded by being able to
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Book title
evaluate an enormous range of practices in use. The fact remains, regardless of where we operate, we are all in the same business of operating public water and wastewater utilities. Figure 2 shows a map of the distribution of participating utilities.
ACA % pORTON .5N.,7661,1 REID DEER CALGARY 6.2Actowsro

REGINA .
Nant METITREAL. ,D.4.,..... R, . r N.
Figure 2 Participating Cities in the National Water and Wastewater Benchmarking Initiative
Methodology: Its Not Rocket Science, but It is Hard Work

Utility Management Model Utility Management Model
Goals
Performance Performance Measures Measures
Data Collection Data Collection Annual Data Analysis and Data and Evaluation Evaluation Review
The NWWBI utilizes a non proprietary benchmarking methodology that follows a conventional annual cycle as shown in Figure 3. Great efforts are placed on keeping the methodology simple and focusing on the effectiveness of each task within the overall process. The management premise is that if even one link is broken; the overall program has no chance for success. The following continue to be critical in the programs ongoing success: The Utility Management Model: What Should We Measure? The first task of the project was to develop a standardized Utility Management Model that would provide the framework for the selection and definition of performance measures. This single step was proven to be critical to the
Closing Workshops Closing W orkshops
Report & Database Report & Database Action Plans Action Plans
Figure 3 Annual Methodology
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foundation of the entire project. Figure 4 illustrates the Utility Management Model that was adopted, with the Utility Goals and the relationship to the many Performance Measures. The Utility Management Model defines a framework of high level goals to which all water and wastewater utilities in Canada aspire to. Success therefore, is literally based on the attainment of these goals. The Model provides the basis for selecting practical and relevant performance measures to measure goal attainment.
NATIONAL W ATER AND W ASTEW ATER BENCHMARKING INITIATIVE UTILITY M ANAGEM ENT MODEL UTILITY GOALS
Reliability & Sustainability Infrastructure Adequacy Cost Efficiency Public Health & Safety Safe & Productive W ork E nvironm ent Custom er S atisfaction Environm ental Protection
n
Annual Review
3 PM 's e.g. Volume of Treated W ater / V ol. of Raw W ater
PERFORMANCE MEASURES (PM's)

12 PM 's e.g. Capital Reinvestment / Replacement Value 4 PM 's e.g. No. of Hours of Storage Capacity at ADD 23 P M 's e.g. O& M Cost / M l Treated 9 PM 's e.g. Length of Main Cleaned / Length 8 P M 's e.g. No. of sick Days Taken per FTE 2 PM 's e.g. No. of W ater Quality Complaints / 1,000 Customers 2 PM 's e.g. No. of Odour Complaints / 1,000 Customers
WATER
WASTE WATER
3 PM 's e.g. % of Design AAF Utilized 4 PM 's e.g. Length of Eroded Stream / Length of Streams
18 PM 's e.g. Length CCTV Inspected / 100km
37 P M 's e.g. P er-Unit B iosolids Cost
5 PM 's e.g. Number of Reported Surcharges
4 P M 's e.g. No. of Accidents / 1,000 Labour Hours
3P M 's e.g. Kg BOD Discharged to Environment per Capita
STORM WATER
4 PM 's e.g. S tormwater Fees / Serviced Population
3 P M 's e.g. O &M + Indirect Costs / 100km Length of Drainage
4 PM 's e.g. Value of Damage due to Flooding / Serviced Population
3 P M 's e.g. No. of Training Hours for SW Employees / Employee
2 PM 's e.g. Are There Stormw ater Regulations?
3 P M 's e.g. No. of Beach Closures
Data Collection
Data Analysis & Evaluation
Closing Workshops
Report & Database
Figure 4 Utility Management Model
Complete Utility Management Goals are presently stated as: 1. Provide reliable and sustainable infrastructure. 2. Provide accessible and sufficient infrastructure (capacity). 3. Meet service and performance requirements at minimum sustainable cost. 4. Protect public health and safety. 5. Provide a safe and productive work environment. 6. Have satisfied and informed customers. 7. Protect the environment and minimize environmental impacts.
With the Utility Management Model in place, a comprehensive set of performance measures were formulated to measure a utilitys success in attaining each individual goal. A very detailed definition for each performance measure numerator and denominator was also documented so that comparable data could be collected to assure valid comparisons. In most cases, each performance measure includes a numerator (expressing the level of goal attainment) and a denominator (normalization factor to enable comparisons, amongst agencies of differing sizes). Table 1 below shows an example performance measure and its corresponding definition:
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Table 1 Example of Performance Measure and Definition Performance Measure Total Operations & Maintenance Cost / km Length of Distribution system Numerator Definition Sum of the actual O&M costs incurred in the operation of the distribution/transmission/ integrated system (excludes capital costs, indirect costs, transfers to reserves and debt/interest charges). Includes O&M costs for both linear (pipes, meters etc) and non-linear (pump stations, reservoirs etc) infrastructure. Revenues are only included where they are recoveries for work done by water distribution staff that is extraneous to the utility (for example, lab tests for other utilities). Denominator Definition Total length of mains in the distribution/transmission/integrated system (i.e. excluding length of service connections). For the distribution system length include all connecting pipes between pump stations, rechlorination facilities and storage facilities if these are located within the distribution system. For the transmission system length include all connecting pipes between pump stations, rechlorination facilities and storage facilities when located between the source and the treatment plant or between the treatment plant and the distribution system.
In all, the NWWBI conducts benchmarking on about 50 performance measures for each of water and wastewater treatment, water distribution and wastewater collection. There are presently about 15 performance measures for the stormwater drainage function. In keeping with our approach to an open methodology, all the NWWBI performance measures and the definitions are published and available to any interested party on the project website (www.nationalbenchmarking.ca). Other benchmarking practitioners are encouraged to leverage their efforts from NWWBI published standards. It is our view that the more international agencies that use these same measures, the easier it will be to make international comparisons if the parties are so interested. Data Collection: Communication and Team Work; Not Data Processing Data collection is the most difficult and time consuming aspect of benchmarking. It is also vitally important, for without accurate and reliable data, it is impossible to make performance observations. AECOMs early research into past exercises demonstrated that the data collection effort was severely underestimated and the resulting data collection flaws resulted in the termination and/or failure of the examined benchmarking examples. Our experience is that no less than 30% of the benchmark effort must be dedicated to this single activity at least in the early stages before quality information can be assured. A key distinguishing factor of this benchmarking project over similar benchmarking efforts is that data is collected through on-site data collection visits with the use of trained data collection staff from AECOM in close association with key utility staff. In addition to effort, participants must be willing to be patient in the development of a robust benchmarking database. OFWAT, the government regulator for the UK and Wales water industry, predicted that it would take two years (two complete iterations) before reliable data could be assumed in their benchmarking efforts1. In our experience, two years
1
International Benchmarking Presentation by S. St. Pier (OFWAT) to the NWWBI, May, 2003.
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has been an optimistic target that only some utilities were able to achieve. For the NWWBI, it has taken about five years to develop reliable, useable data that is statistically significant, historically sound, and accurate for historic trending. However, this longer term has allowed the NWWBI to document best practices for the collection and management of utility data. Unlike other best practices that rely on computer-based data management system, the key to success is communication and team work within each utility department. Computerized data management projects must be designed only after business processes have been developed and installed. Because of the need for communication and cooperation within utility agencies, a personable approach to the collection of information has helped to develop greater insight into a utilitys local factors and operations. The personal involvement of AECOM staff in collecting the information also helps to ensure that quality assured data is collected and is comparable. The unexpected benefit to many participating agencies is that benchmarking may be the first time many utility staff have been asked for very specific information. It is not until the data collection task begins that utilities begin to realize both how much information they actually have about their system, and then whether they can locate it. Many utility organizations still rely on the memories of veteran utility operators or foremen, with intimate knowledge of each valve, pipe, and pump. This complex knowledge is in danger of disappearing with the impending retirement of long-time operators. We try to maintain a personal aspect to the data collection process to ensure that someone talks to this operator (and documents the detail) if the information is not kept elsewhere. The well documented and rigid structure required of the NWWBI data collection provides a detailed framework to begin the difficult process of documenting operational and management information. The ultimate aim is to get this information into key management systems, (such as CMMS, GIS, etc.) and therefore, ensure that valuable knowledge will not be lost with the retirement of that one utility operator. The results are worth the effort and investment. Because the participants are able to use the results with confidence, the project has been able to tackle a wide range of performance related discussions productively. Each year, the project has added valuable content that make the results more and more accessible to municipal utility practitioners. Results: From Data Collection to Continuous Improvement The usefulness of benchmarking data only becomes apparent when continuous improvement actions are formulated. To start this process, the NWWBI produces a vast array of pictorially based graphs (approx. 5,000) that depict overall group performance, and personalized historical trending graphs. These results are published in an annual report, and are always available online through the project website. AECOM even provides a help desk service to customers to assist in customizing the data to meet a wide variety of reporting needs. All data is generated from a relational database management system, but the MS Access-based application tends not to be that intuitive for the occasional user, therefore assistance is always available. Group Comparison Graphs: How do we compare with similar organizations? First, group graphs are produced which compare results within similar groups. Performance measures are calculated from the compiled data in each of Water Distribution, Water Systems, Wastewater Collection, Wastewater Treatment and Stormwater. In comparing the data in group graphs, we compare similar systems for example, only conventional water treatment plants less than 60 ML/day are compared for measures such as O&M cost to avoid
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Book title
the large gap from economies-of-scale and because clearly conventional treatment plants cannot be compared to unfiltered or even direct or membrane filtration plants. As we make further comparisons and interpretations of the graphs, our personal knowledge of the systems help to evaluate what local factors may be considered as well as regional issues that may be of importance. Despite these unique characteristics, there are always comparable issues and factors. The following are example group performance graphs:
Breakdown of Total Full-Time Equivalent staff / 1,000 ML Volume Treated 2003
Field FTEs # of FTEs / 1,000 ML Volume Treated Tech/Eng FTEs Lab FTEs 2003 Estimate % O&M contracted
3.0 2.5 2.0 1.5 1.0 0.5 0.0 -0.5
Supervisor FTEs Indirect FTEs
120% 100% 80% 60% 40% 20% 0%

Estimated % of O&M externally contracted
Negative Values - no data available X-axis - in order of increasing flow
-20%
Figure 5 Example of a group comparison graph.
Costs of Energy per Horsepower All Wastewater Collection Systems $1,600,000 $1,400,000
$1,200,000 Cost of Energy ($) $1,000,000 $800,000 $600,000 $400,000 $200,000

*
y = 69.755x + 262.67 R2 = 0.5359
$0 0 2000 4000
6000
8000
10000
12000
14000
Total PS Horsepower
Figure 6 Continuous Improvement example of a trend for Energy Costs normalized by total Horsepower of all pumps in wastewater collection systems.
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Minimum, Maximum and Average Graphs: How are we doing? One of the other types of graphs that are produced is the personalized minimum, maximum and average trending graphs. The group average, minimum and maximum are shown over three years as well the utilitys own data for three years. In this way, an easy visual comparison can be seen for overall improvement, comparability and performance gaps within a comparable group.
Pump Station O&M Cost ('000) / Total Pump Station Horsepower All Systems with Pump Stations 2003 $42 2002 $39 $48 2001 $414 $456
Minimum
Maximum $189 $180 $169 $244 $216 $208 $0 $100 $200 $300
$355
Average
Utility A
$400
$500
Negative Value - no data available
Figure 7 Example of a minimum/maximum/average personalized graph for water distribution systems.
For example, Utility A is clearly above average in terms of Pump Station O&M Cost per Total Pump Station Horsepower. To realize the full benefits in identifying this performance gap, the personable approach to a utilitys data collection and operations lends insight to the unique local factors that are affecting the results from this utility. Perhaps energy costs are higher in this area; or perhaps they have oversized pumps. The key to improved performance is to understand what the performance driver is and then be able to respond to it. The graphs only help to identify performance gaps; the personal knowledge of the utility allows the information to be applied into a relevant continuous improvement action plan. Radar Charts: How are we doing overall? When asked how a utility was doing on a whole, we did not initially have a visual representation of the utilitys total performance. The radar chart, as observed in the Environmental Sustainability Index project (Yale Center for Environmental Law and Policy, and the Center for International Earth Science Information Network (CIESIN) at Columbia University), was configured as a roll-up of the various Goals and Performance Measures to help utility managers and operators get a quick view of their utilitys performance amongst competing goals, where each goal forms its own axis on the radar chart. Both high and low targets for performance had to be determined to calculate a utilitys performance based on their achievement of the targets. To quantify each utilitys performance on the goals, representative performance measures were used. The logic for
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10
Book title
quantifying the performance measures for the radar charts is based upon discussion, assumptions, and conclusions that were agreed upon at the annual Workshop. A radar chart does not eliminate the need for bar charts but instead summarizes the information provided in the bar charts. A benefit of the radar charts is that it identifies where to start focusing energy on improving the performance of the utility. For example in Figure 8, it is clear that on Goals 3, 4 and 5 the utility is performing on average with the group but on Goals 1 and 2 work needs to be done. The utility would now have to look at the bar charts for the relevant performance measures under Goals 1 and 2 to assess what can be done to improve their performance.
Goal 1 - Reliable
100% 80% 60% 40%
Group Average
s 2000
Goal 5 - Safe
20% 0%
Goal 2 - Sufficient
Goal 4 - Public Health
Goal 3 - Sustainable Cost
Figure 8 Example of a radar chart.
Radar charts can provide annual comparisons for a utility as well as comparisons to best practices or targets established by the group. They allow utilities to compare their overall management to similar utilities. Radar charts are very useful as a method to analyse and summarise large amounts of data. They do not replace the analysis of each bar chart and the details behind each performance measure but will enhance the utilitys ability to take a quick snap-shot of their performance which can be used to communicate performance to all the stakeholders in the utility. Comparing graphs is one thing, but benchmarking cannot end here. In order to improve any function, you must use the information to assist your overall strategic management program. While this is ultimately the responsibility of each participant, the NWWBI is directly involved in the process with the creation and facilitation of an enormous peer to peer network, to consider, plan, and execute a wide variety of continuous improvement initiatives. Peer to Peer Network and Annual Workshop From the outset of the NWWBI, each benchmarking iteration was thoroughly debriefed in a multi-day workshop forum dedicated entirely to understanding the results of benchmarking. Early workshops were informal events, usually located in meeting rooms of a volunteer host utility. But as the partnership grew, and the cross-departmental interest in the results in each
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11
participant also increased, these modest facilities proved inadequate for a productive workshop. The summary workshop is now a major annual event that has total attendance of up to 150 participating utility staff. The key to success remains the events workshop orientation, and does not duplicate the professional association conference format. It is also the major networking opportunity for all participants. After benchmarking for over five years, the partnership has grown and made significant strides towards continuous improvement through various strategic partnerships, task forces, identifying utility gaps and, not least of all, the development of a network of industry operators and managers collaborating and sharing their information. The network is unique in that a similar private sector partnership could never be expected to share this type of information with their competitors. An atmosphere of familiarity, comradeship, and trust has developed through adherence to the group confidentiality protocol2 by all partners that encourages individual and organizational learning, and ultimately increases public sector efficiency and accountability. There is no doubt that one of the greatest benefits and results of the Canadian National Water and Wastewater Benchmarking Initiative is the network of peer contacts that has emerged. Effective Continuous Improvement While many of the participants have developed confidence in their data Business Case and more accurate methods of data Quick Win collection, the NWWBI is now Aeration recommending the Effort and Modifications Incineration Energy Benefits diagram as a tool to Reduction document Continuous Improvement Hydraulic priorities. The Effort and Benefits Improvement diagram illustrates a scale of easeof-implementation and benefit-ofaction that helps to prioritize a Continuous Improvement action. To gain the most benefit for the ease of implementation it is important to conduct an effort and benefits Case by Forget analysis for the top five Continuous Case About It Improvement initiatives identified through a high level review. By Low High rating each Continuous Implementation Complexity Improvement initiative identified for Figure 9 An example Effort and Benefits diagram each utility along those two scales, the effectiveness of each action can be seen relative to the others. Those performance improvement initiatives in the upper right hand corner are the initiatives that deserve more focus in the next year as they have been identified as being not very complex to implement and achieving a high level of benefit.
Low High
Overall Utility Benefit

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Un-blinded benchmarking results are confidential to the partnership.
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Book title
Conclusions
For organizations that are interested in utilizing benchmarking to assist continuous improvement, the above methodology will provide answers to the first three of the four questions originally posed in this papers introduction: How well are we doing?; How do we compare with similar organizations?; Are we getting value for money?
But if you look at benchmarking in isolation, you will not have addressed improvement. To address the final, and ultimately most important question (How can we get better at what we do?), the organization must be willing to accept change. Accepting and embracing change is by far the hardest thing that any organization faces, and there are no easy answers, since human beings are creatures of habit. But if you approach benchmarking not as a numerical exercise that relies on data, automation, and computerization, but rather as a process to expand communication, teamwork, and collaboration, the door to performance improvement will suddenly open, and you will be surprised at the result. As the National Water and Wastewater Initiative matures, we are now starting to benchmark the final result: success in implementing change. To state it another way, the final question becomes Did you do what you said you were going to do? By answering this question with Yes; and here is the proof we now see organizations focusing their efforts on what is truly important. Only now, the leading Canadian municipal utilities that participate in the National Water and Wastewater Benchmarking Initiative know that hard work, communication and teamwork will once again be the keys to success.
References
Alegre, H., Baptista J.M., Hinir, W., and Parena, R. (2000). Performance Indicators for Water Supply Services. Published by IWA Publishing in its Manuals of Best Practice series. London, UK. Arbour, R., and Kerri, K. (1998).Collection Systems: Methods for Evaluating and Improving Performance. Office of Water Programs, California State University, Sacramento, USA. Bain Consultings (2003). Management Tools & Trends Published in the Globe and Mail, June 2, 2003, Toronto, Ontario. Camp, R. C. (1989). Benchmarking: The Search for Industry Best Practices that Lead to Superior Performance, Manager of Benchmarking Competence Quality and Customer Satisfaction, Xerox Corporation. Eisenhardt, P. and Waltrip, G. D. (1999). Improving Wastewater Treatment Plant Operations Efficiency and Effectiveness. Water Environment Research Foundation, USA. Environmental Sustainability Index: An Initiative of the Global Leaders for Tomorrow Environment Task Force, World Economic Forum (2002). Yale Center for Environmental Law and Policy and the Center for International Earth Science Information Network (CIESIN) at Columbia University. http://www.ciesin.columbia.edu/indicators/esi/ Stahre, P. and Adamson, J. (2001). Performance Benchmarking: A Powerful Management Tool for Water and Wastewater Utilities. Sweden. Water Environment Federation (1997). Benchmarking Wastewater Operations: Collection, Treatment, and Biosolids Management, USA. Utility Management: A Framework for Integration (January 2004). Environmental Protection Agency (EPA) / Water Environment Federation (WEF) / Association of Metropolitan Sewerage Agencies (AMSA). Washington, USA.
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Appendix 12A Non-Union Compensation Benchmarking Non-Union Compensation Benchmarking HRWC has been evaluating non-union jobs using the Hay Group Methodology since the early 90s. Hay Group collects compensation date from private and public organizations which evaluate their jobs using the same methodology. From the 184 broad public sector organizations in Hay Groups data bank, HRWC jobs were recently compared with the jobs from 104 of those national broad public sector organizations offering Defined Benefit Pension plans. Hay Group conducted the evaluation and benchmarking for HRWCs non-union jobs effective May 1, 2012, and preliminary results are attached as Appendix 12 Attachment 1. The final report will not be received until the middle of January, and will then be presented to HRWCs Board with associated recommendations. HRWC has also engaged Morneau Sheppell to prepare a study on market compensation for key executive and senior positions for other utilities competing with HRWC. These study results will be available in mid-January and will also be presented to HRWCs Board with associated recommendations. HRWC has also provided HRMs Non-Union Salary Bands, as Appendix 12 Attachment 2, for comparison with executive and senior positions and believe it is a fair surrogate for local market comparison. All non-union compensation presented in the two test years of the rate application is in accordance with HRWCs Compensation Policies as approved by the HRWC Board. There have been no changes in compensation and benefit policies since the last rate application. An allowance for non-union salary increases based on a CPI at 2% has been allowed for within the test years.
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Page 959
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January 9, 2013
Page 960
epeueo epeueo
Updated Comparison Table - December 2012 Top of Salary Scale 2012

198,625 144,500 144,500 144,500 158,951 158,951 106,121 106,121 106,121 106,121 106,121 106,121 106,121 106,121 99,583
Position
General Manager Director, Wastewater/Stormwater Services Director, Water Services Director, Environmental Services Director, Finance/Customer Service Director, Engineering/Information Services Director, Human Resources Senior Environmental Engineer Senior Engineer Superintendent, Wastewater Collection Superintendent, Wastewater Treatment Superintendent, Water Quality/Treatment Superintendent, Water Services Superintendent, Technical Services Controller
Ben. Cr. Amount

3972.50 2890.00 2890.00 2890.00 3179.02 3179.02 2122.42 2122.42 2122.42 2122.42 2122.42 2122.42 2122.42 2122.42 1991.66
Maximum Annual Salary 2010 (Including 2 % Benefit Credit) 202,597.50 147,390.00 147,390.00 147,390.00 162,130.02 162,130.02 108,243.42 108,243.42 108,243.42 108,243.42 108,243.42 108,243.42 108,243.42 108,243.42 101,574.66
HRM April, 2010 Maximum Salary 190,000

(Director level 3 - Director TPW, Chief - Fire/Police)
145,000 (Director level 1) 145,000 (Director level 1) 145,000 (Director level 1) 165,000
(Director Level 2 - Directors Community Development, IAM, Legal, Finance, BPIM, HR)
165,000
(Director Level 2 - Directors Community Development, IAM, Legal, Finance, BPIM, HR)
120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4) 120,000 (M4)
Notes: Salary survey: HW every 3 years; HRM every 2 years. Current Compensation Policy Target Market via Hay Survey: HW and HRM National Broad Public Sector, P50 Hay Job Evaluation Method used by HRM and HW.
January 9, 2013
Page 961
APPENDIX 13
Halifax Regional Water Commission Cost Saving Initiatives! Outcomes Fiscal Year: 2012/13
Water Services Salaries and Benefits Salaries and Benefits - Regular Training and Development Training Job Related Contract Services Contract Services Hired Equipment Materials, Supplies and Services Materials, Supplies and Services Professional Services Consulting
$23,308 $10,000 $66,000 $13,500 $13,000 $200,000
Reduction based on general review and cost trending Deferral of training programs Deferral of reservoirs inspections Reduction based on general review and cost trending Reduction based on general review and cost trending Assessment reports to be done in-house
$325,808
Wastewater! Stormwater Services Salaries and Benefits Salaries and Benefits - Regular
$151,882 Delay in hiring new works advisor and heavy duty mechanic; timing delays associated
with hiring replacement employees for existing positions; savings as a result of maternity leave
Salaries and Benefits - Overtime Contract Services Contract Services Solid Waste Removal Trucking Biosolids Dry Biosolids Treatment Electricity Electricity Materials, Supplies and Services Road and Street Repairs Water and Waste Water Repairs and Maintenance
$90,000 $200,000 $7,000
Reduced Overtime as a result of 2 float process technicians positions being created New culverts and manholes being capitalized Reduction based on general review and cost trending Reduction based on general review and cost trending Reduction based on general review and cost trending Usage less due to lower flows at treatment plants as a result of dry weather conditions; the installation of capacitors and other energy reducing devices Reduction based on general review and cost trending, particularly relating to pump stations Process changes made to reduce water consumption; change over related to the polymer feed system, using industrial water rather than potable water Reduction based on general review and cost trending, in particular to the existing Eastern Passage WWTF which is winding down, requiring fewer repairs and spare parts Related mainly to UV Lamps, the usage and demand is less that expected; further an alternate supplier was found resulting in lower pricing Reduced usage/ purchasing as the active carbon was tested and proved to be still active and functional; savings as a result of bulk purchases Dry weather conditions led to reduced flows and consequently lower demand; efficiencies associated with process refinements and controls Usage less due to lower flows at treatment plants as a result of dry weather Usage in the control of ph levels less as a result of dry weather
$80,000
$150,000 $45,000
$12,000 $77,000 $20,000
Materials, Supplies and Services Chemicals Carbon Alum Polymer Caustic
$470,000
$124,436 $257,602 $250,000 $25,000
$1,959,920
Engineering and Information Services Salaries and Benefits Salaries and Benefits - Regular
$165,000
Deferral in the hiring of a new Project Engineer; timing delays associated with hiring replacement employees for existing positions; delay in hiring a new administrative support person Reduction based on general review and cost trending
Professional Services Consulting
$5,000
$170,000
January 9, 2013
Page 962
Environmental Services Salaries and Benefits Salaries and Benefits - Regular
$75,000
Delay in hiring 2 environmental officers employees related to the SIR Program
$75,000
Administration and Pension Salaries and Benefits Salaries and Benefits - Regular Employee Relations Training and Development Conferences and Travel Training Job Related Contract Services Contract Services Materials, Supplies and Services Telephone Professional Services Audit Advertising General Insurance Municipal Property Taxes New Building at Cowie Hill
$75,000 $8,500 $31,500 $7,800 $17,500 $14,400 $20,000 $21,000
Decision to not hire replacement administrative support staff for existing position, a one month savings in Director of Human Resources position Reductions associated with NW employee recognition awards Reduction based on general review and cost trending, in particular the Biosotids Conference/ Outreach Reduction based on general review and cost trending
Less utilization of consultant services for the rate application than was budgeted.
Reduction based on general review and cost trending Reduction associated with IFRS conversion Reduction based on general review and cost trending, in particular the Biosolids
Conference/ Outreach $2,000 $15,518 $100,000

Reduction associated with fiduciary insurance Recoverable amounts as a result of billing in error Estimated savings having the building operational for 3 months versus 6 months, as originally budgeted
$313,218
Total
$2,843,946
January 9, 2013
Page 963

Halifax Water 2013 Rate Increase Application

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Halifax Water 2013 Rate Increase Application

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Application for the Approval of a Schedule of Rates and Charges and Schedule of Rules and Regulations for the

Delivery of Water, Wastewater and Stormwater Services

Nova Scotia Utility and Review Board

IN THE MATTER OF: - and -

Public Utilities Act

Cathie OToole, CGA, MBA Director of Finance and Customer Service

142 144 146 148 150 152 154 156

158 160 162 164 166 168 170

172 174 176

Target Debt Service Ratio of 35% Target Debt/Equity Ratio of 40%/60%

282 284 286 288 290

294 296 298 300

380 382 384 386

Page 14 388 390

392 394 396 398

400 402 404 406

$85,008 $26,917 $111,925 $2,968 ($3,544) $105,413

$96,328 $27,095 $123,423 $2,957 ($4,199) $116,267

$100,377 $33,310 $133,687 $3,002 ($2,400) $128,285

408 410 412 414

Operating Losses by Jurisdiction Actual 2011/12

($748) ($245) ($993)

($3,431) ($151) ($3,582)

($13,479) ($117) ($13,596)

($24,970) ($150) ($25,120)

Operating Losses by Service Actual 2011/12

Water Wastewater Stormwater Operating Profit (Loss)

$124 $732 ($1,849) ($993)

($762) ($416) ($2,404) ($3,582)

($3,553) ($6,409) ($3,634) ($13,596)

($7,385) ($13,442) ($4,293) ($25,120)

Regulated Unregulated Operating Profit (Loss)

($2,191) $1,198 ($993)

($4,278) $696 ($3,582)

($13,618) $22 ($13,596)

($25,771) $651 ($25,120)

416 418 420 422 424 426

Airport/ Aerotech Wastewater Water Stormwater

Summary of Compliance with Orders from 2012 Rate Application

Page 19 574 576

$144.12 $95.69 $239.81

$80.84 $169.58 $250.41

$86.61 $190.26 $276.87

Wastewater Base Charge Consumption Charge

$152.16 $243.65 $395.81

$140.16 $263.20 $403.36

$164.82 $324.51 $489.33

($12.00) $19.55 $7.55

-7.9% 8.0% 1.9%

$24.66 $61.31 $85.97

17.6% 23.3% 21.3%

Stormwater Base Charge

Based on estimated annual household consumption of 188 cubic metres

18 N.S.R. (2d) 692, 75 D.L.R. (3d) 72

Page 22 710 712

714 716 718

720 722 724

Water Rate Study 2013/14 Appendix 1 Page 1

HRWC Water Rate Study

Water Rate Study 2013/14 Appendix 1 Page 2

Notes on Worksheet Worksheet W-1 System Data

Water Rate Study 2013/14 Appendix 1 Page 3

Projected Growth 2012/13 0 0 850 20 15 30 15 5 3 0 0 0 938