Brace, taxpayers.
A big bill is coming your way.
Earlier this month, sources say, the regional Metro Vancouver government summoned the three North Shore mayors for a meeting. The objective was to better understand the runaway train known as the North Shore wastewater treatment project.
Only one of three mayors came: Mike Little of the District of North Vancouver. West Vancouver’s mayor sent a middle manager from the engineering department. In hindsight, he would have been better to make time to show up, because the briefing revealed no small sticker shock. On the other hand, maybe avoiding the meeting would be better for the blood pressure.
The implications of the project for this and future councils are substantial and appear to present an inflection point in West Vancouver’s ability to properly finance its formidable infrastructure needs.
In the next weeks, the North Shore will more clearly apprehend what it takes today to replace the crucial wastewater treatment infrastructure that is running its course in capacity. It seems it’s time to contend with the reality of the project’s scope, its current and anticipated expense, and how to pay for it.
You may recall the new plant plan started as a $525 million modernization, then escalated to a $1.05 billion construct. Along the way the original contractor, the Spain-based Acciona, departed acrimoniously and litigiously, and PCL bid for and assumed the construction responsibility, with AECOM as the designers.
Once they moved in, the narrative about the construction and design morphed from proud optimism to frank criticism about what they inherited, suggesting they had to go back to square one.
As the Metro Vancouver website politely puts it, “numerous design and construction errors and deficiencies were identified from the previous contractor, who was responsible for both designing and building the new treatment plant. Over the past several months we have been working to correct these deficiencies and advance the design in order to develop an accurate schedule and cost estimate to complete the project.”
Well, it now has a number, and it will be best to read the next line sitting down.
I’m told the new estimate is coming in at … $4 billion.
You read that right.
Get ready to bear a serious, long-lasting bite to finance this – about $400 annually for a typical residential property owner, unless there is a newfound generosity at a federal or provincial level, perhaps as assistance to the North Shore communities as they densify and require consequential infrastructure requirements. Most likely, too, are deferrals of all but the most crucial fixes and builds.
A special meeting of Metro Vancouver to deal with the wastewater project takes place Oct. 4. There is a plan the next day to provide the grim details of the expense and the reasons why. We may have to wait for some time to understand exactly how the North Shore leadership plans to extract the funds from property owners.
The project is in many ways emblematic of the extraordinary local expenses that challenge administrators and politicians to prevent taxes from breaking through the ceiling. These projects are mostly financial beasts and most, but not every, politician hates imposing expense. In many cases, too, politicians try to defer repairs, replacements and maintenance. With this new multi-billion tally, the district may lose its ability to properly finance this.
Last year the Fraser Institute analyzed municipal costs in the Lower Mainland, and West Vancouver’s infrastructure was the most expensive – not because we want our sewer pipes platinum-plated, but because our sloped topography drives up the costs. It contributes to the highest per-capita spending municipally in the Lower Mainland. It bears noting that the wastewater project is one of many ahead under Metro Vancouver.
It can be said that West Vancouver finds itself in particular peril because it has no industrial land to tax and only a smallish amount of business tax revenue. Nearly 95 per cent of the property tax base is residential. The buck stops at the house’s doorway.
Now this new bill is looming and it’s time to get ready for the reckoning. The October meeting will be instructive for taxpayers, in part on how our politicians handle the bills.
Kirk LaPointe is publisher and executive editor of Business in Vancouver as well as vice-president, editorial, Glacier Media Group, the North Shore News’ parent company. He is also a West Vancouverite.
