City utility corporation will get deeper look

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St. Albert will spend $100,000 to investigate the pros and cons of a city-owned utility company.

City council approved a motion from Mayor Cathy Heron in a 6-1 vote to have staff draw up a feasibility report on the idea and put together a business case by March 4, 2019.

The report will look at water distribution, wastewater collection, new wastewater treatment opportunities, solid waste collections and lifecycle management, as well as opportunities with heat and electricity generation and distribution.

Heron said a utility corporation could help to address St. Albert’s high residential taxes by giving the city another source of revenue. As a for-profit entity, the corporation could provide services the city currently doesn’t – such as waste services to industrial, commercial and institutional properties.

The $100,000 will be spent on an independent third-party review.

“I really think we need to do this independently so we can stand in front of residents and say, ‘This was not driven by our administration, this was not driven by council. This makes sense – or it doesn’t,’ ” Heron said.

She said her hope is that a utility corporation would respond faster to business opportunities, innovation and new development than the city, and could help reduce servicing costs to new areas of development.

Heron said her vision for the company would be to keep utility rates for residents on a cost-recovery basis and instead generate revenue from other ventures. If the city decides to move forward with a zero-waste initiative, for example, the corporation could look at providing services outside of St. Albert.

Any revenue from a utility corporation would flow to the city and council would decide how to use it.

Coun. Sheena Hughes, who cast her vote against the motion, said she feared a utility corporation would allow the city to inflate utility rates since the corporation would not be bound by the same rules as municipalities are.

“The only thing a utility corporation does is allow us to charge more money than is necessary,” she said.

“In reality it is just a hidden tax, and I can’t be supporting something of that nature.”

Coun. Ken MacKay said he is looking forward to seeing if the report reveals an opportunity to save the city money and pass those savings along to residents.

He added that if establishing a utility corporation meant a lot of infrastructure costs, he would not be in favour of putting that burden on residents.

Coun. Ray Watkins took issue with Hughes’ characterization of this council as one of hidden tax increases.

He said he felt the report could give council some insight into potential ways to save money.

“I think that if we look at this, we may be able to find a way to do things more efficiently and find a way to lower taxes,” he said.

“I think if we don’t look at it, we’re remiss because there could be some potential savings here to the taxpayers of St. Albert,” Watkins said.

Watkins and Coun. Wes Brodhead both said the fact that council is dealing with the topic publicly means it is not hidden.

“I think it’s important that as councillors we’re open to new things, and sometimes to be fully informed to make a good decision, we have to be educated appropriately,” Brodhead said.

“I want to understand what this will do to the community – I want to know how it will improve the distribution of how we collect money.”

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