london · increase in administrative, other, and recovered expenses and purchased services offset...

APPENDIX A

Planning, Environmental and Engineering Services Department

Wastewater and Treatment

2012 Operating and Gapital Budgets

and

Nine Year Capital Plan

LondonCANADA

of Water and City Engineer

Table of Contents

Wastewater and Treatment Budget Highlights Recommendations ............................................................................................................................................................. 1 Executive Summary ........................................................................................................................................................... 2 What You Get For Your Wastewater and Treatment Dollar ............................................................................................. 17 2012 Budget Highlights .................................................................................................................................................... 18

Operating Budget 2012 Operating Program Budget Summary .................................................................................................................... 19 2012 Object of Expenditure and Source of Revenue Summary ...................................................................................... 20 Overview of Program Changes - Revenue ...................................................................................................................... 21 Overview of Program Changes - Expenditures ............................................................................................................... 22 Four Year Operating Forecast ......................................................................................................................................... 23 Performance Measures and Staffing ................................................................................................................................ 25

Capital Budget Capital Program ............................................................................................................................................................... 26 Capital Expenditure Summary by Classification ............................................................................................................... 28 Capital Source of Financing Summary ............................................................................................................................. 29 Capital Expenditure Detail ................................................................................................................................................ 30

Reserve Funds and Reserves .......................................................................................................................................... 55 Debt Summary ................................................................................................................................................................... 59

2012 Schedule of Rates and Charges .............................................................................................................................. 61

Planning, Environmental and Engineering Services Department Wastewater and Treatment

2012 Budget

1

RECOMMENDATIONS That, on the recommendation of the Director of Water and City Engineer, the following actions be taken with respect to the 2012 Operating Budget, Capital Budget and 2013 - 2021 Capital Forecast for Wastewater and Treatment Services:

(a) the 2012 Operating Budget for Wastewater and Treatment Services BE APPROVED as submitted;

(b) the 2012 Capital Budget for Wastewater and Treatment Services BE APPROVED as submitted;

(c) the 2013 - 2021 Capital Forecast for Wastewater and Treatment Services BE RECEIVED for information;

(d) all rates and charges related to the provision of Wastewater and Treatment Services BE INCREASED by 7%, effective January 1, 2012;

(e) the proposed by-law to amend the Sewer System Fees and Charges By-law BE INTRODUCED at the Municipal Council meeting on November 21, 2011 to effect the rates and charges noted in (d), above; and

(f) the Civic Administration BE AUTHORIZED to create a reserve relating to non-tangible capital assets in order to comply with accounting legislation under PSAB 3150.


2012 Budget

2

EXECUTIVE SUMMARY The proposed 2012 Wastewater and Treatment operating and capital budget continues along the path toward financial sustainability. Administration has prepared the 2012 operating and capital budget based on the financial sustainability rate plan endorsed by Council during the development of the 2011 budget. This will result in a 7% rate increase in 2012.

The 20 Year Sewer System Plan (revised summer 2011) was developed taking into account the City's current sewer system needs, its debt and financing capability and the need to move to sustainability as per the anticipated requirements of the province's Sustainable Water and Sewage Systems Act 2002 and The Water Opportunities Act 2010. In addition, the 20 Year Sewer System Plan has been amended to reflect an updated water consumption forecast.

The average cost to the homeowner for 2012 will increase by $31 per year (based on consumption of 192.6 m3). At the proposed rates in 2012 the homeowner’s cost for the year will be $469 or $1.28 per day for sanitary and storm sewers, stormwater management and wastewater treatment services.

The 20 Year Sewer System Plan and the resulting annual operating and capital budgets continue to support the mandate of the Wastewater and Treatment Service Area which connects well with the City’s Strategic Priorities as follows:

City's Strategic Priorities Wastewater & Treatment Mandate Environmental Leadership Protect Our Environment

Infrastructure Renewal and Expansion Invest in Our Community Economic Prosperity and Managed and Balanced Growth Undertake Responsible Long Term Planning


2012 Budget

3

Financial Overview

The proposed 2012 Wastewater and Treatment budget presents a balanced cost/revenue plan in the amount of $75.5 million.

The proposed operations budget of $34.1 million represents a 3.2% increase over 2011. However, a 0% operating budget has been achieved after adjustments are made for the following uncontrollable costs:

Unsettled labour agreements (ie. non-union) and the second year of the OMERS rate increase (consistent with the General Property Tax Supported Budget);

Electricity costs due to rising rates; Contracted serviced provided by London Hydro; and Transfer of billing and administrative costs from Water.

Wastewater and Treatment continues to utilize a number of initiatives including increased use of new technologies to minimize operating and capital costs.

Debt servicing costs are projected to increase from $11.9 million to $13.2 million and capital funding has been increased by $1.7 million to $28.2 million. The Wastewater and Treatment Area continues to utilize and build its reserves in accordance with the 20 Year Sewer System Plan. Refer to pages 55-58 for the reserve funds used by Wastewater and Treatment.

Since 2010, the operating budget has been either at or close to a 0% increase (consistent with the departmental target in the general tax supported budget). Administration continues to strive to eliminate waste, improve efficiencies, and utilize new technology in an effort to minimize operational costs. Administration believes that the operating budget has now been reduced to a point where further operating targets of 0% will begin to impact service levels.


2012 Budget

4

Exhibit 1

(18)

136

556

383

1,057

147

1,600

1,334

3,081

4,138

Contracted services provided by London Hydro.

Operating Related

Increase in Administrative, Other, and Recovered Expenses and Purchased Services offset by a reduction in Equipment Rentals. It should be noted this includes $250 related to the move to full cost accounting through a transfer of an additional share of other administration costs from Water to Wastewater and Treatment.

Change (000's)Explanation of Changes in Expenditures

Increase in contributions to reserve funds to maintain the 20 Year Sewer System Plan.

Increase in capital levy required to fund life cycle renewal projects. The increase in capital levy reduces the more costly proposition of debt servicing in future periods and ensures that annual life cycle costs are funded on a pay-as-you-go basis.

Increase in cost of debt servicing related to previously approved capital projects.

Capital Related

Total Expenditures Increase of 5.8% - Rate Increase of 7%

Savings in vacancy management will more than offset the increase in OMERS and wage, salary, and benefit adjustments taking into account employment agreements.

Increase in materials and supplies primarily driven by escalating electricity rates partially offset by reduced natural gas.


2012 Budget

5

Water Consumption and Conservation

Average household water usage in London has declined 22% from 2001 to 2010 and is projected to reach 24% in 2011. The graph below (Exhibit 2) illustrates Wastewater and Treatment costs for the average household. This reduction has made capacity available within treatment plants to handle more wet weather flows, projected growth and delayed plant expansions.

There are a number of influencing factors responsible for this conservation trend. Although the impact to departmental revenues is negative, the overall impacts of water consumption should be seen as a positive trend toward Conserving the Future, and should be encouraged.

It is anticipated that the final billed volume for 2011 will be somewhat less than budget due to the continued reduction in consumption by residential, institutional, commercial, and industrial water users. The 2011 budget was based on volume of 45.5 million cubic metres (Mm3) which is being reduced to 44.5 Mm3 for the proposed 2012 budget. This represents a consumption and conservation reduction of 2.2% which has been absorbed into the revenue projections for 2012.


2012 Budget

6

Exhibit 2

$182

.86

$193

.52

$203

.66

$205

.70 $2

35.8

7

$233

.46 $2

68.2

4

$269

.03

$279

.72

$303

.93

$297

.94

$2.8

5 $7.2

9

$20.

85 $1

5.60

$33.

88 $3

4.39

$60.

84

$79.

83 $87.

98

$93.

97

253.4m3

192.6m3

125

150

175

200

225

250

275

$100.00

$150.00

$200.00

$250.00

$300.00

$350.00

$400.00

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Cubi

c M

eter

s (m

3)

Average Cost of Annual Sanitary Bill(per single family home)

Conservation Savings

Actual Average Cost per Household

Avg. Annual Household Consumption

Proj

ecte

d


2012 Budget

7

Rate Increases Needed to Sustain the Utility

During the approval of the 2011 budget, Council endorsed a rate plan that targeted financial sustainability by 2016. While the declining water consumption trend helps to postpone future works, it is placing significant pressure on the City’s capacity to raise funds to operate, maintain and improve the existing system. Since water consumption has been declining at a more rapid pace than originally forecasted, Administration has re-forecasted its long-term water consumption estimates. This has resulted in a significant impact to the capital plan based on the current long-term rate forecast. In an effort to mitigate the revenue impacts resulting from water consumption, Administration is recommending deferring financial sustainability to 2018 (the long-term rate forecast is detailed in Exhibit 3).

Administration is recommending 7% rate increases in 2012 through 2016 with a 4% increase in 2017 and return to the rate of inflation thereafter. This would enable the sewer system to reach financial sustainability by 2018 which is consistent with the principles of the 20 Year Sewer System Plan. The projected rate increases are offset by an anticipated net consumption reduction of 0.75% (assuming a 1% growth factor and an average consumption reduction of 1.75%) for the first ten year period and an anticipated net consumption reduction of 0% (assuming a 1% growth factor and an average consumption reduction of 1%) for the second ten year period. The future projected rate increases will be used by in large to address the infrastructure deficit.

It should be noted that projections are based on best available information at this time. Changes in the economic climate, legislative requirements, or water consumption trends may result in modifications to the 20 Year Sewer System Plan to ensure sustainability is achieved.


2012 Budget

8

Exhibit 3

Long-Term Rate Forecast from 20 Year Sewer System Plan

Year Rate Increase Required Net Consumption/Growth Demand Program

Requirements 2013 - 2016 7% -0.75% 6.25%

2017 4% -0.75% 3.25% 2018 3% -0.75% 2.25%

Cost Saving Initiatives

The Wastewater and Treatment Service Area undertakes continuous improvement in all areas with a focus on efficiency and effectiveness, that is, “Doing the Right Things, Right”.

Construction Technologies

There have been significant changes in the philosophy of the life cycle and replacement of underground infrastructure. Construction methodology for the maintenance of existing infrastructures has evolved utilizing methods which are less costly, intrusive and disruptive. Extending the life cycle of existing sewers through lining defers full replacement for many years and provides good value for the investment.

For private drain connection replacement, trenchless construction is expected to supplant the traditional open cut excavation method. While these new methods require additional equipment, they generate significant savings in material and labour costs. Additionally, they are less socially disruptive and again provide good value for the investment.


2012 Budget

9

Sewage Treatment

Wastewater and Treatment Operations’ continuous improvement in processes and management systems has provided incremental cost savings. Numerous automation processes continue to reduce costs, offsetting chemical and energy unit cost increases and the significant financial impacts of increasing legislation. In addition to the cost savings achieved, the sewage treatment plants are experiencing a reduction in equipment failures and a reduction in sludge volumes also attributable to automation and process improvements.

Capital Program

The proposed 2012 capital budget of $58.4 million (Exhibit 4) is supported by a combination of reserve funds, capital levy, debt and contributions from non-rate supported sources such as Development Charges and Federal Gas Tax, and is consistent with the 20 Year Sewer System Plan.

The 2012 capital plan addresses needs which have been identified through the sewer inspection program and engineering studies such as the Sanitary and Storm Sewerage Master Plan updates and the 20 Year Sewer System Plan. This plan works within the constraints of the debt servicing ratio, gradually increasing the pay-as-you-go funding for life cycle replacement, and slowly growing the reserve funds. This balanced approach fulfills the anticipated regulations of the Sustainable Water and Sewage Systems Act, 2002 and The Water Opportunities Act 2010.


2012 Budget

10

Exhibit 4

2012 Wastewater & Treatment Capital Plan Summary Category of Project Total ($000’s) Percentage

Life Cycle Renewal 20,080 34% Growth 16,229 28% Service Improvement 20,875 36% Non-Tangible Capital Asset 1,260 2%

Total 58,444 100%

The major projects in each category are detailed below:

Life Cycle Renewal:

Life Cycle Renewal is a key component to sustainability and ensuring a well-functioning Wastewater and Treatment System. The City's sewer system has an approximate current replacement value of $3.6 billion. Significant needs have been identified in the system. Subsequently, funding for implementation of programs have gradually been increased over time to address some of these system needs.


2012 Budget

11

ES2414-12 Life Cycle projects - $9.04 M

The sanitary and storm infrastructure Life Cycle Renewal program is an annual program intended to manage and ultimately maintain the life of our sewer infrastructure at an acceptable level. The program is integrated with other service areas within the entire organization and utilizes best management practices in an effort to return functionality to a wastewater system or subsystem. Systematic reinvestment in this burdened infrastructure is a critical and cost effective approach to maintaining its functionality and to meet the changing needs as a community grows and matures. The decision-making process for determining the proper balance of repair, renewal, and replacement is a function of the condition assessment, the life cycle cost of the various rehabilitation options, and the related risk reductions. Sewers are generally replaced on a priority basis, based on age, material, condition and capacity. Sewers in need of remediation are either fully replaced or spot repaired in conjunction with other service and utility upgrades in selected areas. In some cases, promising, innovative technologies are used to replace or repair infrastructure at a reduced cost.

ES2693-12 Specialized Sewer Repairs - $4.5 M

Sewer relining uses a polymer soaked felt tube cured by steam or hot water to create a new pipe within the old pipe without excavation. The work takes about 5 hours per sewer run (100m) and consists of lining the sewer with a 1 to 2cm thick polymer lining and then cutting the service connections with a track mounted robot. Sanitary service connection will be blocked during this time and which requires residents to minimize water usage. Both storm and sanitary sewers can be relined in full or in short sections which adds 50 years to their lifespan. The City also undertakes relining and other trenchless technology methodologies for manhole repairs, sewer spot repairs and watermain relining. The benefits of trenchless technologies are the capital cost savings because the road doesn’t need to be excavated, the minimized social cost in terms of disruption (ie. 1 day as opposed to 4 months), and the environmental benefit of not requiring new materials. This program has created a cost avoidance of $85 M over the last 5 years by extending the life spans of sewer infrastructure.


2012 Budget

12

Wastewater and Treatment is proactively relining sanitary and storm pipe greater than 100 years old that are suitable for relining. It is anticipated that this will be achieved by 2012 with the exception of trunk sewers. Pipes in the 80 to 100 year period that are currently in good condition will be carefully monitored to ensure that appropriate pipes are relined at the right time. This will significantly improve the life expectancy of the City’s oldest pipes enabling the City to defer associated reconstruction costs for many years. Administration continues to explore “cutting edge” trenchless technologies with the primary goal of passing along cost savings to the citizens of London.

Service Improvements:

ES3111 White Oak Industrial Park Local Sanitary - $6.26 M

This project is the construction of the local sanitary sewers to service the existing White Oak Industrial Park. The existing businesses in this area are currently serviced by private septic systems and wells. These works, in combination with the installation of a new watermain will allow the existing businesses to expand or intensify industrial uses. The sanitary sewer and watermain for this area will be subject to the City’s Local Improvement or Area Rating process, with cost sharing between the City and the benefiting property owners.


2012 Budget

13

Growth:

ES2682 Dingman Erosion Control and Wetland Remediation Works - $2.33 M

This project is the construction of remediation works to address existing erosion and conveyance deficiencies in the Dingman Creek Main Channel (drainage area of approximately 11,000 ha). This includes the construction of a regional stormwater management wetland system as recommended by Dingman Creek Subwatershed Class Environmental Assessment Study Update. The construction will proceed in phases, subject to the City obtaining land for this facility. Total cost of this project is estimated at $9.4 M as per the 2009 Development Charges Study. $7.1 M has been approved in previous year’s budgets and the balance of $2.3 M is being recommended for approval in 2012.

ES3019 Stormwater Management Growth Works (Fox Hollow 1, White Oak, Tributary C) - $12.3 M

The construction of the following three projects will provide quality and quantity control for new development within their respective service areas and represent the majority of the $12.3 M budget for ES3019 in 2012. Fox Hollow SWMF #1 ($4.2 M) located at the headwaters of the new Heard Drain Channel to service approximately 110 ha of land development within the Fox Hollow Development Area. White Oak SWMF #1 ($3.2 M) will service approximately 65 ha of new land development within the White Oak Development Area. Riverbend Tributary ‘C’ SWMF works will service approximately 94 ha of new land in the Riverbend Area. The project costs for the work the City will undertake in Tributary ‘C’ is currently estimated at $6.5 M of which $3.5 M was approved in the 2011 budget and the balance ($3 M) is being recommended for approval in the 2012 budget. Other miscellaneous stormwater management growth works account for the remaining $1.9 M.


2012 Budget

14

Related Legislation and Other Challenges

While the province has not yet tabled the regulations in support of the Sustainable Water and Sewage Systems Act 2002, they have taken a number of significant steps that support the requirement for all municipalities to move to sustainability. In August 2007, the Ontario Ministry of the Environment (MOE) filed the Regulation and Guidelines for the Safe Drinking Water Act, 2002 Financial Plans requirement (O. Regulation 453/07). This adds to the requirements of PSAB 3150 (Public Sector Accounting Board) for the tracking of tangible capital assets and requires utilities to not only track assets but to also ensure the adequate funding of replacements. The Water Opportunities Act 2010 includes requirements to have sewer utilities follow suit and move to truly sustainable systems and to ensure that the infrastructure renewal gap is ultimately eliminated.

The Wastewater and Treatment Area is preparing for a new wave of Canada-wide effluent criteria. Effluent discharge objectives will be determined within the next five-years for receiving waterways. Monitoring will be required for an array of parameters including acute and chronic toxicity. Although London is fortunate to have plants that already surpass virtually all of the new standards, a position many other municipalities are now under pressure to meet, staff are pro-actively engaged to review all pending changes in regulations to ensure compliance can be met in the future.

Health of the Thames River

Federal criteria also have an impact on the way the City manages its combined sewers. By Federal estimates the national cost for sewer separation is $15 billion (and this is thought to be on the low side). London’s cost of separate sewers has yet to be determined and in large part will be additional costs to the 20 year plan. Until the exact parameters and limits are defined, additional work and related costs needed to meet the new reality cannot be determined.


2012 Budget

15

The City is in the early planning stages of developing a Pollution Prevention Control Plan as per the requirements of the MOE for measuring the impacts and means to reduce and/or manage combined sewer overflows and wet weather treatment bypasses in an affordable manner. As stricter regulations are imposed, the existing system grows larger and older and as maintenance and operating costs escalate, extending the life cycle and improving the performance of the existing infrastructure becomes essential to addressing the infrastructure gap.

This budget supports these requirements and challenges while managing the utilities’ revenue and the City’s debt strategy. The proposed direction enhances London’s Advantage by continuing to position London to reach sustainability. Through a sound proactive business approach, rate increases can be managed imposing the least impact on affected rate payers. Acquiring the appropriate level of financing to meet current legislative requirements and support routine operations, maintenance and replacement programs is imperative to public health, safety and environmental protection.

Residential Sump Pump Discharge to Ground Surface

Through public complaints and staff observations a street surface maintenance and public safety concern has long been identified relating to private property sump pump discharges on to private yards, which then migrate over the ground surface to public sidewalks, curbs, gutters and even the asphalt roadway. These sump pump discharges are especially an issue during winter months when the water freezes causing damage to the sidewalks, curbs, gutters, roadways and slip and fall hazards to pedestrian traffic.

WWT staff is recommending that this program commence in 2012 as part of an expanded Sump Pump Grant Program and be developed within future Wastewater and Treatment Capital budgets with the intent that these problem areas will be addressed over a number of years. It is expected that in addition to correcting an existing infrastructure problem, benefits of such a program would result in improved public safety, reduced City liability, reduction of premature infrastructure replacement, and increasing the efficient use of City operations, risk management, customer services and relations, and WWT staff time.


2012 Budget

16

Conclusion

The City of London’s sanitary and storm sewer system has a replacement value over $3.6 billion. Many components of the system are at or beyond their anticipated service life. The major challenge is the work that must be undertaken to properly sustain, improve and grow the system through operating and capital funding.

Water consumption has been declining at a more rapid pace than originally forecasted. As a result, Administration has re-forecasted water consumption estimates and amended the 20 Year Sewer System Plan to ensure financial sustainability is achieved while ensuring the infrastructure gap is narrowed. Based on the revised 20 Year Sewer System Plan, financial sustainability is now projected to occur in 2018.

A well managed sewerage system supports the health, well being and prosperity of our urban community, and is an integral part of the City’s strategic priorities regarding Environmental Leadership, Infrastructure Renewal and Expansion, Economic Prosperity and Managed and Balanced Growth. By becoming sustainable we provide value for future generations.

This budget, with its 7% rate increase, moves the City toward compliance with the anticipated requirements of the Sustainable Water and Sewage Systems Act 2002 and The Water Opportunities Act 2010. For the average homeowner, this will result in a yearly increase of $31 to $469 per year or $1.28 per day (based on consumption of 192.6 m3). Londoners can continue to rely on the Sewer System, part of London’s Advantage.

17

Budgeted Residential Cost at 2011 Rates (1)

Forecasted Residential Cost at 2011 Rates (1) Proposed Increase (7%)

Forecasted Residential Cost at 2012 Rates (2)

Sanitary $320 $298 $21 $319Storm $140 $140 $10 $150

$460 $438 $31 $469


What You Get For Your Wastewater and Treatment Dollar

(2) Based on an average residential consumption of 192.6 m3.

(1) The budgeted residential cost in 2011 ($460) was based on an average residential consumption of 207 m3. The 2011 residential cost has been restated based on a revised consumption estimate of 192.6 m3.

Wastewater & Drainage Engineering,

3%

Sewer Operations, 12%

Wastewater & Treatment Operations,

25%

General Administration & Financial Expenses,

3% Billings & Customer

Service, 3%

Debt Servicing, 17%

Capital Funding, 37%

18

($000's) %

2012 Proposed Budget $75,501 2011 Approved Budget $71,363

Increase Over 2011 Budget $4,138 5.8%

Revenue Adjustments Including Consumption Reduction Estimate 1.2%

Total Rate Increase 7.0%

Wastewater and TreatmentPlanning, Environmental and Engineering Services Department

($000's)2012 Budget Highlights

19


2012 Operating Program Budget Summary($000's)

2011 2012 Change PriorApproved Proposed from Year

Budget Budget 2011 ChangeRevenues

Sanitary Sewer System Charge 50,384 51,185 53,595 2,410 4.7%Storm Drainage System Charge 15,808 15,755 17,026 1,271 8.1%Other Revenues 5,934 4,423 4,880 457 10.3%Total Revenues 72,126 71,363 75,501 4,138 5.8%Engineering & Operations

Wastewater & Drainage Engineering 2,504 2,451 2,530 79 3.2%Sewer Operations 9,540 8,651 8,691 40 0.5%Wastewater & Treatment Operations 18,801 18,315 18,853 538 2.9%

General Administration & Financial Expenses (1) 43 1,871 2,135 264 14.1%

Billings & Customer Service (1) 0 1,765 1,901 136 7.7%Total Engineering & Operations 30,888 33,053 34,110 1,057 3.2%Capital Contribution & Debt Servicing

Debt Servicing Costs 8,979 11,866 13,200 1,334 11.2%

Contribution to Reserve Funds (2) 22,853 19,944 20,091 147 0.7%Capital Levy 9,406 6,500 8,100 1,600 24.6%Total Capital Contribution & Debt Servicing 41,238 38,310 41,391 3,081 8.0%

Total Expenditures 72,126 71,363 75,501 4,138 5.8%

Program 2010 Actuals


(2) Includes contributions to corporate reserves for Economic Development, Local Improvements and Self Insurance.

(1) Proportionally allocated to Wastewater & Drainage Engineering, Wastewater & Treatment Operations, and Sewer Operations in 2010 and separated into its own category in 2011 and 2012.

20

2011 2012 Change PriorApproved Proposed from Year

Budget Budget 2011 ChangeRevenuesSanitary Sewer System Charge 50,384 51,185 53,595 2,410 4.7%Storm Drainage System Charge 15,808 15,755 17,026 1,271 8.1%Other Revenues 5,934 4,423 4,880 457 10.3%

Total Revenues 72,126 71,363 75,501 4,138 5.8%Operating RelatedPersonnel Costs 13,378 14,574 14,556 (18) -0.1%Administrative, Other & Recovered Expenses 1,419 1,344 1,647 303 22.5%Billings & Customer Service 1,593 1,765 1,901 136 7.7%Purchased Services 2,828 3,155 3,300 145 4.6%Materials & Supplies 8,326 8,915 9,471 556 6.2%Equipment & Rentals 3,344 3,300 3,235 (65) -2.0%

Total Operating Related 30,888 33,053 34,110 1,057 3.2%Financial ExpensesDebt Servicing Costs 8,979 11,866 13,200 1,334 11.2%Contribution to Reserve Funds (1) 22,853 19,944 20,091 147 0.7%Capital Levy 9,406 6,500 8,100 1,600 24.6%

Total Financial Expenses 41,238 38,310 41,391 3,081 8.0%

Total Expenditures 72,126 71,363 75,501 4,138 5.8%(1) Includes contributions to corporate reserves for Economic Development, Local Improvements and Self Insurance.

Program 2010 Actuals

Planning, Environmental and Engineering Services DepartmentWastewater and Treatment

2012 Object of Expenditure and Source of Revenue Summary($000's)

21

$4,138

Although 2012 rates are proposed to increase by 7%, Sanitary Sewer System revenues are projected to increase by 4.7% over the 2011 budget due to the continued trend of water conservation and an increase to non-revenue water.

The Storm Drainage System Charge rate is proposed to increase by 7% and the number of household billing accounts is projected to increase by 1%.

Explanation of Changes in Revenue

Total Revenues Increase of 5.8% - Rate Increase of 7%

$2,410

$1,271

The rates for other revenues are proposed to increase by 7% in addition to a small increase in volumes. $457


Overview of Program Changes - Revenue($000's)

Change (000's)

22

(18)

136

556

383

1,057

147

1,600

1,334

3,081

4,138

Increase in contributions to reserve funds to maintain the 20 Year Sewer System Plan.

Increase in capital levy required to fund life cycle renewal projects. The increase in capital levy reduces the more costly proposition of debt servicing in future periods and ensures that annual life cycle costs are funded on a pay-as-you-go basis.

Increase in cost of debt servicing related to previously approved capital projects.

Capital Related

Total Expenditures Increase of 5.8% - Rate Increase of 7%


Savings in vacancy management will more than offset the increase in OMERS and wage, salary, and benefit adjustments taking into account employment agreements.

Increase in materials and supplies primarily driven by escalating electricity rates partially offset by reduced natural gas.

Contracted services provided by London Hydro.

Operating Related

Increase in Administrative, Other, and Recovered Expenses and Purchased Services offset by a reduction in Equipment Rentals. It should be noted this includes $250 related to the move to full cost accounting through a transfer of an additional share of other administration costs from Water to Wastewater and Treatment.

Change (000's)

Overview of Program Changes - Expenditures($000's)

Explanation of Changes in Expenditures

23

2013 - 2016 Forecast


Four Year Operating Forecast

The projected rate increases of 7% from 2013 to 2016 have been incorporated into the 20 Year Sewer SystemPlan. While the declining water consumption trend helps to postpone future works, it is placing significantpressure on the City’s capacity to raise funds to operate, maintain and improve the existing system. Since waterconsumption has been declining at a more rapid pace than originally projected, Administration has re-forecastedits long-term water consumption estimates and rates to ensure financial sustainability is achieved. The projectedrate increases are offset by an anticipated net consumption reduction of 0.75% (assuming a 1% growth factor andan average consumption reduction of 1.75%) for the first ten year period and an anticipated net consumptionreduction of 0% (assuming a 1% growth factor and an average consumption reduction of 1%) for the second tenyear period. It should be noted that projections are based on best available information at this time. Changes inthe economic climate, legislative requirements, or water consumption trends may result in modifications to the 20Year Sewer System Plan to ensure sustainability is achieved.

24

2012 2013 2014 2015 2016Proposed Budget Budget Budget Budget

Budget Forecast $ % Forecast $ % Forecast $ % Forecast $ %Sewer Rate Forecast 7.0% 7.0% 7.0% 7.0% 7.0%

Revenues

Sanitary Sewer System Charge 53,595 56,945 3,350 6.3% 60,504 3,559 6.3% 64,286 3,782 6.3% 68,304 4,018 6.3%Storm Drainage System Charge 17,026 18,388 1,362 8.0% 19,859 1,471 8.0% 21,448 1,589 8.0% 23,164 1,716 8.0%Other Revenues 4,880 5,026 146 3.0% 5,177 151 3.0% 5,332 155 3.0% 5,492 160 3.0%

Total Revenues 75,501 80,359 4,858 6.4% 85,540 5,181 6.4% 91,066 5,526 6.5% 96,960 5,894 6.5%Engineering & Operations

Wastewater & Drainage Engineering 2,530 2,606 76 3.0% 2,684 78 3.0% 2,765 81 3.0% 2,848 83 3.0%Sewer Operations 8,691 8,952 261 3.0% 9,221 269 3.0% 9,498 277 3.0% 9,783 285 3.0%WWT Operations 18,853 19,419 566 3.0% 20,002 583 3.0% 20,602 600 3.0% 21,220 618 3.0%General Administration & Financial Expenses 2,135 2,449 314 14.7% 2,522 73 3.0% 2,598 76 3.0% 2,676 78 3.0%Billings & Customer Service 1,901 1,958 57 3.0% 2,017 59 3.0% 2,078 61 3.0% 2,140 62 3.0%

Total Engineering & Operations 34,110 35,384 1,274 3.7% 36,446 1,062 3.0% 37,541 1,095 3.0% 38,667 1,126 3.0%Capital Contribution & Debt Servicing

Debt Servicing Costs 13,200 14,500 1,300 9.8% 15,200 700 4.8% 15,440 240 1.6% 15,738 298 1.9%

Contribution to Reserve Funds 20,091 20,675 584 2.9% 22,294 1,619 7.8% 24,665 2,371 10.6% 27,155 2,490 10.1%

Life Cycle Funding 8,100 9,800 1,700 21.0% 11,600 1,800 18.4% 13,420 1,820 15.7% 15,400 1,980 14.8%

Total Capital Contribution & Debt Servicing 41,391 44,975 3,584 8.7% 49,094 4,119 9.2% 53,525 4,431 9.0% 58,293 4,768 8.9%

Total Expenditures 75,501 80,359 4,858 6.4% 85,540 5,181 6.4% 91,066 5,526 6.5% 96,960 5,894 6.5%

Incr./(Decr.) Over 2015


Four Year Operating Forecast($000's)

ProgramIncr./(Decr.) Over 2012



25

2010 2011 2012 2013 2014 2015 2016Performance Measures Actual ExpectedActivity Measures# of meters of sewer installed (1) 16,200 7,800 6,500 9,500 11,000 10,500 11,000# of PDC's replaced (2) 330 75 75 75 75 75 75Sanitary sewer flushed (km) (2) 800 750 650 650 650 650 650Storm sewer flushed (km) (2) 75 80 85 80 80 80 80Rehabilitated / relined (km) 43 20 21 21 22 22 20Volume of wastewater treated (billion litres) 70.3 71.0 71.0 71.0 71.0 71.0 71.0Efficiency MeasuresAnnual cost of sanitary sewer flushing $528K $520K $465K $480K $490K $500K $510KAverage cost per household per year (3) $444 $438 $469 $494 $525 $557 $592Residential consumption (per cubic meter) 196.5 192.6 192.6 188.4 186.4 184.4 182.4Effectiveness / Quality / Satisfaction MeasuresPercentage of flooding complaints addressed 100 100 100 100 100 100 100Compliance - # of MOE effluent violations 1 1 1 1 1 1 1% BOD removed - treatment 98.8 98.5 98.5 98.5 98.5 98.5 98.5StaffingFull-time Equivalents # 183.3 185.0 182.5 182.5 182.5 182.5 182.5Increase / (Decrease) over previous year (2.2) 1.7 (2.5) 0.0 0.0 0.0 0.0Full-time Employees # 170 169 167 167 167 167 167Increase / (Decrease) over previous year 0.0 (1.0) (2.0) 0.0 0.0 0.0 0.0NOTES:

(2) Sewer Operations only.

Performance Measures and Staffing

(3) The average cost per household per year in 2011 and 2012 is based on residential consumption of 192.6 m3.


Forecast

(1) 2010 - Impacted by corporate stimulus funding.



2012 Capital Budget

With Forecasts

26

Service Grouping: Wastewater and TreatmentCommittee: Built and Natural Environment CommitteeObjective:

Page Number

Project Number Project

46 ES1721 Economic Development 2,40053 ES1825-12 Video Inspection 40053 ES2092-12 Sump Pump Grant Program 10046 ES2108 Thames River Clear Water Revival 3030 ES2414-12 Sewer Replacement Program 9,040

30 ES2428-12 Erosion Remediation in Open Watercourses Management and Reclamation 320

36 ES2435 PDC'S Installed with Claimable Urban Works 5046 ES2442 Extension of Services 84053 ES2450 Wastewater and Treatment Master Plan 30047 ES2452 Water Quality and Storm Flow Conveyance Monitoring Program 28047 ES2464-12 Separation and CSO Program 2,10054 ES2470 Adoption of Climate Changes Strategy 46047 ES2472 Local Improvement - Fanshawe Park Road East Sanitary Sewer 5030 ES2473 Gordon Trunk Sewer Rehabilitation 1,00048 ES2474 UTRCA Remediating Flood Control Works within City Limits 94048 ES2497 Flood Control and Protection 11531 ES2523-12 Sewer Construction, Extensions and Repairs 80031 ES2532-12 Stormwater Management Facility Remediation Program 20048 ES2680 Sherwood Forest Flooding Remediation 1,200

2013-2016 Forecast -

Growth

($000's)

Non-TCA Capital (1)

The Wastewater and Treatment capital program addresses life cycle renewal, service improvement and growth related needs within the City’spollution control plants, pump stations, and sanitary and stormwater collection systems. The elements in this program are generally identifiedthrough the sewer inspection program, known deficiencies as addressed by the appropriate engineering studies and documents such as theSanitary and Storm Sewerage Master Plans aligned with the Principles of the 20 Year Sewer System Plan.

224,988$

Service Improvement


58,444$ 2012 Proposed Budget -

Life Cycle Renewal

Capital Program

27

Service Grouping: Wastewater and TreatmentCommittee: Built and Natural Environment Committee 2013-2016 Forecast -

($000's)

224,988$


58,444$ 2012 Proposed Budget -

Capital Program

Page Number

Project Number Project

38 ES2682 Dingman Erosion Control and Wetland Remediation Works 2,33038 ES2685 Greenway Expansion and Upgrade 86031 ES2693-12 Specialized Sewer Repairs 4,50049 ES3015 Murray Marr Stormwater Management Facility #2 1,20040 ES3019-12 Stormwater Management and Outlet Structures for Linked Systems 12,26449 ES3040-12 Minor Surface Flooding and Erosion 21050 ES3111 Local Improvement - White Oak Industrial Subdivision Sewer 6,26042 ES4402 Extension of the Stoney Creek Sanitary Sewer 60042 ES4410 Non-Growth Share of UWRF Works 12533 ES4825-12 Municipal Drain Reconstruction 33033 ES4834-12 Municipal Drain Maintenance 7034 ES5084-12 Replacement Equipment Pollution Control Plant 2,70034 ES5150-12 Pumping Station Improvements 42051 ES5165-12 New Equipment Pollution Control 75051 ES5234 Adelaide PCP CSO 2,30034 ES6066 Dingman Pumping Station Header Reconfiguration 50051 ES6071 Southcrest Storm Outlet 1,00052 ES6072 Green Valley Drain/Wilton Grove Remediation Works 1,00035 ES6074 Pottersburg PCP CSO and Inlet Works Upgrade 20052 ES6089 Applegate Stormwater Management Facility Remediation Works 200

Total by ClassificationTotal 2012 Wastewater & Treatment Capital

$16,229

Life Cycle Renewal Growth

$58,444(1) The following items are classified as Non-TCA Capital (previously classified as Life Cycle Renewal, Growth, or Service Improvement) and any unspent money at year end will be moved intoNon-TCA reserves for future spending. Non-TCA Capital items represent items that are classified as capital for budget purposes but are not considered Tangible Capital assets for financialreporting.

$20,875$20,080 $1,260

Service Improvement

Non-TCA Capital (1)

28

Prior Years

2011 2012 2013 2014 2015 20162017 to

2021Total

Life Cycle Renewal 5,402 17,996 20,080 22,590 21,140 20,720 25,330 118,600 251,858

Growth 50,808 25,461 16,229 19,798 15,683 14,309 27,268 80,137 249,693

Service Improvement 10,957 14,285 20,875 16,420 14,830 12,020 12,880 53,560 155,827

Non-TCA Capital 990 400 1,260 500 500 500 500 2,900 7,550

Total 68,157 58,142 58,444 59,308 52,153 47,549 65,978 255,197 664,928


Capital Expenditure Summary by Classification($000's)

Wastewater & Treatment

29

Wastewater and TreatmentPrior Years

2011 2012 2013 2014 2015 20162017 to

2021Totals

RATE SUPPORTED

Sewer Capital Rates 690 6,500 8,100 9,800 11,600 13,420 15,400 102,998 168,508

Sewage Works Reserve Fund 10,688 17,416 19,133 18,411 19,578 19,221 24,984 48,579 178,010

Industrial Oversizing Sewer Reserve Fund 2,007 32 219 340 550 2,188 3,872 9,208

Sewage Treatment Plant Capacity Reserve Fund 3,142 138 1,184 16,144 20,608

Debenture 20,209 1,994 7,917 4,571 2,700 37,391

Debenture (Industrial Oversizing Reserve Fund) 3,799 2,966 6,765

Total Rate Supported 40,535 28,908 35,288 34,185 34,218 33,191 42,572 171,593 420,490

NON-RATE SUPPORTEDDebenture - Non Rate Supported (City Services - Sewer Levies Reserve Fund) 14,223 493 5,542 477 6,245 17,421 44,401Debenture - Non Rate Supported (City Services - Major SWM Levies Reserve Fund) 1,677 6,753 7,260 1,400 7,400 5,116 7,390 21,043 58,039

City Services Sewer Levies Reserve Fund (Note 1) 5,878 7,349 1,098 5,252 1,045 50 849 11,792 33,313

City Services Major SWM Levies Reserve Fund 1,247 5,029 4,768 3,643 2,555 1,690 1,209 1,528 21,669

City Services Corporate Services Reserve Fund 113 287 400

Federal Gas Tax Grant 2,000 5,500 5,500 5,500 5,500 5,500 5,500 27,500 62,500

Other Contributions (Prov Grants, Cash Payments) 2,484 4,110 4,243 3,786 1,435 1,525 2,213 4,320 24,116

Total Non-Rate Supported 27,622 29,234 23,156 25,123 17,935 14,358 23,406 83,604 244,438

Total Sources of Financing 68,157 58,142 58,444 59,308 52,153 47,549 65,978 255,197 664,928


Capital Source of Financing Summary($000's)

1) Growth splits for 2012 and beyond are consistent with the 2009 Development Charge Study.

30

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total

9,276 9,040 10,600 10,800 11,700 15,400 78,600 145,416

2012 Financing: Reserve Fund $6,290 Federal Gas Tax Grant 2,750 Total Financing $9,040

320 420 420 440 320 1,600 3,520

2012 Financing: Capital Sewer Rates2,000 1,000 1,000 1,000 5,000

Service Grouping: Wastewater and Treatment Category: Life Cycle Renewal

ES2428-12 Erosion Remediation in Open Watercourses Management and Reclamation

Planning, Environmental and Engineering Services DepartmentWastewater and TreatmentCapital Expenditure Detail

($000's)

To provide remediation of significant erosion and hydraulic deficiencies in existing open watercourses. City's Subwatershed studies have identified locations that require remediation.

ES2473 Gordon Trunk Sewer Rehabilitation

Trenchless rehabilitation of 3.7 km of the Gordon Trunk Sanitary Sewer with the cured-in-place pipe sewer lining. Sewer is generally in poor condition and continues to deteriorate. Requires immediate rehabilitation for continued service.

2012 Financing: Reserve Fund

The design and construction of replacement sanitary sewers, storm sewers and private drain connections and needs of other Engineering Divisions determined on a priority basis. Sewers are replaced based on age, material, condition and capacity. Sewers in need of remediation are either fully replaced or spot repaired in conjunction with other service and utility upgrades in selected areas. A video inspection program assists with review and ultimate selection of specific repairs.

ES2414-12 Sewer Replacement Program

31

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

200 1,700 1,900

800 800 800 800 800 800 4,000 8,800

200 200 200 200 200 200 1,000 2,200

3,500 4,500 5,000 5,000 4,000 4,000 17,500 43,500

2012 Financing: Capital Sewer Rates $2,938 Reserve Fund 1,562 Total Financing $4,500

ES2523-12 Sewer Construction, Extensions and Repairs

An annual program to respond to maintenance and repair of existing assumed Stormwater Management Facilities.

An annual program to extend the life of existing sewers through trenchless technologies primarily focused on internal lining projects plus internal spot repairs and the construction of accesses to previously inaccessible trunk sewers.

ES2532-12 Stormwater Management Facility Remediation Program

2012 Financing: Capital Sewer Rates

An annual program to alleviate existing and potential flooding conditions through extensions/completion of sewer sections and repair. Work is completed in conjunction with local annual construction program.

ES2476 Elliot-Laidlaw Remediation WorksTo undertake remediation works to minimize flooding and erosion, improve conveyance and eliminate existing deficiencies at a tributary of the Dingman Creek by constructing the required Stormwater Management measures to meet the City and Provincial requirements.

2012 Financing: Capital Sewer RatesES2693-12 Specialized Sewer Repairs

32

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

1,210 150 150 150 450 2,110

300 2,500 2,800

100 800 900

350 350

Improvements to the trunk sanitary, storm and combined sewers to accommodate redevelopment and growth while reducing or eliminating overflows and rehabilitating deteriorating sewers.

Investigate trunk sanitary and combined sewer systems, relating to structural condition and hydraulic capacities. Bi-annual program required to identify areas where more frequent maintenance may be needed to maintain capacities.

ES3067 Trunk Sewer Condition Assessment

To replace storm sewers and improve drainage on Fanshawe Park Road, from Adelaide Street to Highbury Avenue. Work to be done in conjunction with Transportation Project TS1475 and Water Project EW3702.

ES3074 Trunk Sewer Upgrades

ES3106 Commissioners Road Sewer Replacement: Viscount Road to Wonderland Road

To replace existing sanitary and storm sewers and private drain connections from Viscount Road to Wonderland Road that are in poor condition. Work to be done in conjunction with Transportation Project TS1470 - Road Widening.

ES4424 Fanshawe Park Road Sewer Replacement

33

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

330 330 330 330 420 420 2,100 4,260

2012 Financing: Capital Sewer Rates $170 Grant 65 Local Improvement 95 Total Financing $330

70 70 70 70 70 70 350 770

2012 Financing: Capital Sewer Rates $22 Grant 22 Local Improvement 26 Total Financing $70

ES4834-12 Municipal Drain Maintenance

ES4825-12 Municipal Drain Reconstruction

An annual program for reconstruction of various municipal drains throughout the City of London, under the Drainage Act as initiated by property owner petition in order to alleviate flooding on private and public property.

Minor repairs to any municipal drain within City boundaries in accordance with the Drainage Act. Provincial grants subject to availability. City share of individual projects varies, and this request reflects average only. Any drainage works constructed under this Act relating to the construction or improvement of drainage works by local assessment must be maintained and repaired by each local municipality.

34

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

2,250 2,700 2,600 1,300 1,300 1,550 7,600 19,300

420 420 420 420 420 420 2,100 4,620

1,790 320 2,110

402 100 100 602

500 500ES6066 Dingman Pumping Station Header Reconfiguration

ES5150-12 Pumping Station Improvements

An annual program to monitor pumping stations (36) and replace/upgrade various components such as hydraulic, structural, mechanical, electrical and instrumentation equipment and review of tributary flows to ensure adequate future capacity is available.



ES5084-12 Replacement Equipment Pollution Control Plant

To rebuild and resurface deteriorated access roads and roads within plant and pumping stations.

ES5424 Roadway Improvements to PCP's

This project encompasses a series of studies that lead to better management of the sewer system and its assets including such projects as Infrastructure and Maintenance Management Systems, enhanced process, condition and priority assessment tools.

ES5419 Managing the Sewer System and Assets

Replacement of aged or non-repairable mechanical, electrical and instrumentation equipment to maintain and upgrade current operations.

This project will be to study, design and modify the header pipe used to convey sewage to and from the Dingman Pumping Station to the Dingman Storage Facility and force main.


35

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

1,500 1,500

200 800 1,000

700 700

0

Total Life Cycle Renewal 5,402 17,996 20,080 22,590 21,140 20,720 25,330 118,600 251,858

Replacement of filtration membrane modules for Oxford PCP.

ES6075 Greenway Incinerator Rebuild

Balance of approved projects for prior years comparison

ES6074 Pottersburg PCP CSO and Inlet Works UpgradeTo capture and partially treat combined sewer overflows through the use of chemically enhanced primary treatment (CEPT) to provide rapid removal of suspended solids and BOD in the primary tanks and allow for split flow to aeration.

ES6073 Oxford PCP Membrane Replacement

Incinerator replacement includes shell, brick, exchanger, preheater, venture scrubber and water cooling system.


36

Service Grouping: Wastewater and TreatmentPrior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total

50 50 50 50 50 50 50 250 600

50 105 155

165 660 4,685 5,510


($000's)

ES2475 Dingman Creek Main Channel Remediation Works

ES2466 Hyde Park Pumping Station Upgrades

ES2435 PDC's Installed with Claimable Urban Works


Cost reimbursement for installing Private Drain Connections (PDC's) for existing properties at the time trunk sewers are installed in conjunction with UWRF initiated projects. Constructing PDC's in this manner avoids significant connection costs, disruption and road restoration costs.

To undertake remediation to minimize flooding/erosion, improve conveyance and eliminate existing deficiencies within the main channel of Dingman Creek and construct a water resources management system to meet the stormwater requirements associated with land use changes and optimize the performance of this system to meet the Provincial Water Quality and Flood Control objectives. Growth splits are consistent with the 2009 Development Charge Study. 14% Growth Related (13.4% DC Rate Supported).

To upgrade Hyde Park Pumping Station following the provision of new trunk sanitary sewers on Hyde Park Road and Oxford Street ES2493. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (100% DC Rate Supported).

Category: Growth

37


2017 to 2021 Total


($000's)

Category: Growth

3,360 3,740 7,100

500 3,850 650 5,000

2,700 2,237 3,877 8,814ES2681 Mud Creek Erosion and Flooding Remediation Works

ES2493 Hyde Park Trunk Sanitary Sewer

To undertake remediation works to minimize and eliminate erosion, conveyance and flooding deficiencies for the north portion of the Mud Creek system within the Mud Creek East subwatershed. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (93.7% DC Rate Supported).

Project for the construction of a trunk sanitary sewer on Oxford Street West from Hyde Park Road to Sanatorium Road and on Hyde Park Road from Oxford Street to Sarnia Road in conjunction with Road Reconstruction TS1477 and TS1493. Coordinated with Water Project EW3685. Growth splits are consistent with the 2009 Development Charge Study. 86% Growth Related (85.1% DC Rate Supported).

To improve conveyance capacity and undertake erosion remediation works to address the existing deficiencies and support growth in the areas of the White Oak Road corridor, from Exeter Road to Dingman Drive and south of Dingman Creek. This area is in the Dingman Creek subwatershed and will require Regional Stormwater Management Facilities to meet Provincial Water Quality and Flood Control objectives. 70% Industrial Growth.

ES2485 Old Oak Servicing

38


2017 to 2021 Total


($000's)

Category: Growth

4,690 2,350 2,330 9,370

Debenture $462 Reserve Fund 1,600 Development Charges 268 Total Financing $2,330

19,915 860 5,905 26,680

Sewage Treatment Reserve Fund $138 Reserve Fund 163 Development Charges 559 Total Financing $860

ES2682 Dingman Erosion Control and Wetland Remediation Works

To undertake remediation works to minimize and eliminate existing flood, erosion and conveyance (capacity) deficiencies for the Dingman Creek Tributary and Dingman Creek main channel within the Dingman Drive Planning Area Study and construct a wetland water resources remediation system. Growth splits are consistent with the 2009 Development Charge Study. 12% Growth Related (11.4% DC Rate Supported).

2012 Financing:

Expansion and upgrade of the Greenway Pollution Control Plant. 89% Growth Related (64.8% DC Rate Supported).

2012 Financing:

ES2685 Greenway Expansion and Upgrade

39


2017 to 2021 Total


($000's)

Category: Growth

600 640 1,240

To undertake remediation works to minimize and eliminate the existing erosion, conveyance, and flooding deficiencies of the south portion of the Mud Creek subwatershed and construct the Stormwater Management system and potential replacement to meet the Provincial Flood Control and Water Quality objectives. Growth share differs from the 2009 Development Charge Study arising from the Environmental Assessment. 30% Growth Related (28.8% DC Rate Supported).

ES2688 Mud Creek Remediation South

40


2017 to 2021 Total


($000's)

Category: Growth

11,501 12,264 5,240 10,068 4,142 3,831 23,539 70,585

Reserve Fund $504 Development Charges 11,760 Total Financing $12,264

Construction of Stormwater Management Ponds. These projects were previously funded through UWRF, now funded through Development Charges. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (94.7% DC Rate Supported).

Projects currently scheduled to be completed by 2016 in this program with year and total cost as per the 2009 DC Study: - Fox Hollow SWMF #1 (2012 $4.2M) - White Oaks SWMF #1 (2012 $3.2M) - Riverbend Tributary "C" SWMF (2012 $6.5M) - Mud Creek Online Facility (2012 $1.2M) - Hyde Park SWMF #6 (2013 $2.4M) - Hyde Park SWMF #5 (2014 $6.5M) - SWMF SA2 (Wickerson) (2014 $3.2M) - Old Victoria SWMF #2 (2015 $2.4M) - Pincombe Drain Remediation Online SWMF (2015 $4.2M) - White Oak SWMF #3 (2016 $2.8M) - Miscellaneous SWMF Projects ($2.0M)

2012 Financing:

ES3019-12 Stormwater Management and Outlet Structures for Linked Systems

41


2017 to 2021 Total


($000's)

Category: Growth

1,345 621 2,875 1,207 5,002 11,050

195 760 5,435 6,390

150 560 4,030 4,740

To undertake remediation works to minimize and eliminate existing flooding, erosion and conveyance capacity deficiencies for Dingman Creek System and construct wetland water resources remediation system. Growth splits are consistent with the 2009 Development Charge Study. 10% Growth Related (9.6% DC Rate Supported).

ES3202 Dingman On-line Stormwater Management Flood Control Facility #2

ES3080 Greenway Incinerator Refurbishment

ES3201 Dingman On-line Stormwater Management Flood Control Facility #1

To refurbish incinerator for existing and additional sludge management capacity at GPCC for city wide growth. The 2011 approved budget includes Non-TCA expenditures (hauling, disposal and lime) resulting from the incinerator shutdown. Growth splits are consistent with the 2009 Development Charge Study. 13% Growth Related (10.5% DC Rate Supported).

To undertake remediation works to minimize and eliminate existing flooding, erosion and conveyance capacity deficiencies for Dingman Creek System and construct wetland water resources remediation system. Growth splits are consistent with the 2009 Development Charge Study. 15% Growth Related (14.4% DC Rate Supported).

42


2017 to 2021 Total


($000's)

Category: Growth

668 3,470 600 212 4,950

Reserve Fund $62 Development Charges 538 Total Financing $600

150 125 125 125 125 125 125 625 1,525

2,430 2,430

To provide the non growth costs of works which are Urban Works claimable and led by the developer. Non growth portions are identified in City of London Sanitary Sewerage Master Plan.

ES4402 Extension of the Stoney Creek Sanitary Sewer

Construction of the Stoney Creek Trunk sanitary sewer from Trossacks Avenue to the Stackhouse Avenue Crossing of Stoney Creek. Routing along Trossacks Avenue, Fanshawe Park Road and undeveloped lands north of Fanshawe Park Road. Construction as identified in the Stoney Creek Trunk Sanitary Sewer Environmental Assessment. Growth splits are consistent with the 2009 Development Charge Study. 89.7% Growth Related (89% DC Rate Supported).

ES4410 Non-Growth Share of UWRF Works

Expansion and upgrade of the Oxford Pollution Control Plant to increase hydraulic capacity by 9 MLD to treat projected flows. 100% Growth Related (97.6% DC Rate Supported).

2012 Financing:

2012 Financing: Reserve FundES5014 Oxford PCP Expansion and Upgrade Phase II

43


2017 to 2021 Total


($000's)

Category: Growth

200 1,453 1,653

31,000 31,000

500 2,500 3,000

260 5,932 6,192

Construction of a gravity sanitary sewer from the Bostwick area southerly to the proposed Wonderland-Dingman Pumping Station. This part of the project constructs 1,230m of sanitary sewer along Wharncliffe Road South to Wonderland Road. ES5248 will construct trunk sewer from Wharncliffe Road/Wonderland Road to the proposed Wonderland Dingman Pumping Station. Growth splits are consistent with the 2009 Development Charge Study. 89% Growth Related (89% DC Rate Supported) and 87% Growth Related (87% DC Rate Supported).

ES5233 Vauxhall PCP Expansion and Upgrade

ES5142 Pottersburg PCP Expansion and Upgrade

ES5247 and ES5248 Wonderland/Wharncliffe Road South Trunk Gravity Sewer

Expand and upgrade existing pumping station to handle additional flow of 18.2 MLD. Industrial Growth is in Southeast London. Growth splits are consistent with 2009 Development Charge Study. 100% Growth Related (20% DC Rate Supported).

ES5132 East Park Pumping Station Expansion

Project at the Pollution Control Plant include an expansion and upgrade, preliminary and final design, construction and commissioning. 96.7% Growth Related (93.9% DC Rate Supported).

Expansion and upgrade to increase hydraulic capacity by 9 MLD to accommodate increase in development areas tributary to the plant. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (47.3% DC Rate Supported.)

44


2017 to 2021 Total


($000's)

Category: Growth

200 1,729 1,929

110 110

2,890 2,890

250 100 200 500 6,550 7,600

Construction of the Kilally South Trunk from the Edgevalley Phase I Subdivision part way to Kilally Road. Routing as identified in the Kilally South Area Plan. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (100% DC Rate Supported).

ES5252 Kilally South Trunk Sanitary Sewer

New project for the extension of municipal sanitary sewer on Exeter Road from Breck Avenue to Meadowgate Boulevard (1,000m) and northerly. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (100% DC Rate Supported).

Extension of the Kilally South Sewer along Kilally Road easterly of Sandford Street. Work as identified in the Kilally South Area Plan. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (100% DC Rate Supported)

ES5256 Exeter Road Trunk Sanitary Sewer

ES5254 Kilally Road - Extension of Kilally South Trunk Sanitary Sewer

ES5260 Lambeth Southland Trunk Sanitary Sewer

To construct trunk sanitary sewers in the existing Lambeth area to service growth areas as well as provide trunk sanitary servicing for existing unserviced area of Lambeth. Trunk sewers will outlet to the proposed Wonderland-Dingman Pumping Station and allow decommissioning of the existing Southland PCP (Southside SS3). Growth splits are consistent with the 2009 Development Charge Study. 96% Growth Related (95.3% DC Rate Supported).

45


2017 to 2021 Total


($000's)

Category: Growth

1,100 800 1,635 3,535

7,715 550 1,000 9,265

626 1,150 1,776

9,084 5,520 14,604

Total Growth 50,808 25,461 16,229 19,798 15,683 14,309 27,268 80,137 249,693

ES5431 Adelaide PCP Expansion Phase II

Phase II includes addition of aerated and final clarifier tanks and upgrading process operations in order to comply with MOE requirements. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related based on flow/capacity (97.9% DC Rate Supported).


Extension of storm sewer west of River Road Industrial Park. Timing dependant upon private developments.

Project to assume stormwater management and oversizing sewer works for Innovation Park Phase III. Coordinated with CAO's Industrial Land Project ID1168, and Water Oversizing Project ID2057. 58.2% Growth Related (5.6% DC Rate Supported).

ID2058 Innovation Park - Sewer Oversizing Works

ID2140 River Road Industrial Land Sewer Extension

46

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total

1,400 2,400 3,800

30 30 30 30 30 150

840 800 1,640 1,680 2,600 4,000 11,560

Reserve Fund $210 Local Improvement 630 Total Financing $840

ES2108 Thames River Clear Water Revival

Staff initiated a regional watershed project to assist in the wise management and protection of the Thames River watershed. This project is an update of the 1975 "Thames River Basin Study" and borrows approaches from the successful HELP Clean Water partnership which focused on our regional drinking water supplies. Project funding to be used to match funding from other partners for an external project coordinator and meeting expenses.

2012 Financing:

ES1721 Economic Development

Cost sharing project for the extension of services to unserviced parts of the Urban Growth area and beyond. City's share is 25% of the total cost.

2012 Financing: Debenture

This project represents capacity that has been created in the Wastewater and Treatment Capital Budget to be used to fund larger scale economic initiatives and projects that will create long term jobs for the City of London. This funding is currently in support of the International Water Technology Centre.


Category: Service ImprovementsService Grouping: Wastewater and Treatment


($000's)

ES2442 Extension of Services

47

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

840 280 280 280 280 280 2,240

3,000 2,100 6,300 6,990 4,280 6,740 30,850 60,260

Reserve Fund $550 Federal Gas Tax Grant 1,550 Total Financing $2,100

225 50 275

ES2452 Water Quality and Storm Flow Conveyance Monitoring ProgramTo undertake monitoring works to evaluate the water quality and storm flow conveyance for various watercourses and the Thames River.

This project is undertaken to investigate, monitor, model, develop and implement solutions to reduce or eliminate combined sewer overflows (CSO's). Study work will develop a list of priorities. Some projects are already defined and planned for design and construction in the short term. Construction of separate storm and sanitary sewers are planned for a number of areas, which will effectively reduce the volume of storm drainage diverted to the sanitary sewer system and prevent/reduce CSO's to the Thames River. 2012 Financing:

ES2464-12 Separation and CSO Program

Local improvement sanitary sewer on Fanshawe Park Road East from Highbury Avenue easterly approximately 300m or extent of road widening project.

ES2472 Local Improvement - Fanshawe Park Road East Sanitary Sewer



48

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

1,540 100 940 2,150 2,000 1,200 940 7,160 16,030

115 115

600 1,200 1,800

1,450 1,450

Program in partnership with the Upper Thames River Conservation Authority (UTRCA) who contributes matching funding through provincial programs for maintaining and reconstructing components of the City's flood and erosion control infrastructure.

To undertake design and construction of remedial works to alleviate basement flooding and sewer surcharging in the area of Whitehills/Sherwood Forest. The work involves potential sewer upsizing and or storage solutions.

Construction of trunk storm sewer along C.P.R. tracks between Waterloo Street and Maitland Street.

ES3013 Carling Creek Trunk Storm Phase IV

ES2680 Sherwood Forest Flooding Remediation

ES2497 Flood Control and Protection

Installation of three river level gauges to assist in flooding forecasts and protection.



ES2474 UTRCA Remediating Flood Control Works within City Limits

2012 Financing: Federal Gas Tax Grant

49

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

600 1,200 1,800

50 1,100 1,150

500 210 210 210 210 210 1,050 2,600

7,452 150 2,000 9,602

200 2,380 940 2,360 7,950 13,830

Construction of regional Stormwater Management Facility #3 in the Murray Marr drainage area.

ES3016 Murray Marr Stormwater Management Facility #3

ES3058 Burbrook Lateral Program

Construction of trunk storm sewer between Florence Street and Dundas Street to relieve severe flooding in Burbrook Watershed. This is the last phase of a four phased project. Tunnelling works from Phase III to be revisited (designed and constructed).

Burbrook Lateral Storm Sewers provide stormwater drainage to areas in the Burbrook Drainage Area, which are tributary to the Burbrook Trunk Storm Sewer. Coordinated with Water Project EW3624.

2012 Financing: Debenture

ES3015 Murray Marr Stormwater Management Facility #2

ES3040-12 Minor Surface Flooding and Erosion

Construction of regional Stormwater Management Facility #2 in the Murray Marr drainage area.


Annual program to construct works in order to alleviate surface flooding and erosion problems affecting private property, which are outside the scope of the municipal sump pump grant program.

ES3054 Burbrook Trunk Storm Sewer Phase IV

50

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

1,400 1,000 2,400

300 1,825 6,260 4,600 12,985

Debenture $2,855 Local Improvement 3,405 Total Financing $6,260

Cost sharing project for the installation of sanitary sewers for the existing White Oak Industrial Subdivision. White Oak South Sanitary Servicing Environmental Assessment completed in 2005. Local servicing to be provided as local improvement under City policy regarding extension of services to existing unserviced areas, following completion of GMIS White Oak Trunk Sewer in 2011. Property owners pay 75% of costs, City pays 25%. To be carried out in conjunction with Local Improvement Water Servicing EW3805. Budget for 2012 has been updated to reflect exemptions under the Local Improvement Act. The City has been paying 100% design fees, 25% of construction costs, and any exemptions under the Local Improvement Act. It is estimated that this represents 60% of the total project costs. Actual amounts to be determined in Fall 2011.

2012 Financing:

Replace the existing 1,200mm trunk storm sewer outlet with a 2,400mm storm sewer from Ada Street to Terrace Street to properly service the existing watershed.

ES3059 Dayus Creek Trunk Storm Sewer Replacement

ES3111 Local Improvement - White Oak Industrial Subdivision Sewer

51

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

1,550 750 50 100 2,450

1,300 2,300 1,300 4,900

Reserve Fund $1,300 Debenture 1,000 Total Financing $2,300

500 500

620 1,000 1,620

ES5234 Adelaide PCP CSO


New storm sewer and storm outlet required through Kensal Park Public School (from the terminus point of previous Gordon Avenue Capacity Improvement works) easterly through to a new outlet, to be constructed east of Greenwood Avenue into The Coves.

ES6070 Southdale Road Widening - Sanitary Relocation and Upsizing

ES6071 Southcrest Storm Outlet

Annual program for additional mechanical, electrical and instrumentation equipment required to maintain and improve operations.

2012 Financing:

ES5165-12 New Equipment Pollution Control


Sanitary relocation and upsizing in conjunction with Transportation Road Widening Project (TS1486) with construction planned in 2013. Limits are on Southdale between Wonderland Road South and Wharncliffe Road South. Storm drainage improvements addressed by Transportation Services.

To design and construct an effluent pumping station with standby power.

52

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total



($000's)

800 1,000 1,800

80 200 280

2,230 2,230

10,957 14,285 20,875 16,420 14,830 12,020 12,880 53,560 155,827

ES6072 Green Valley Drain/Wilton Grove Remediation Works


Total System Improvement


The project will encompass the reconstruction/remediation of approximately 400 linear meters of the Green Valley Drain/tributary to the Dingman Creek to improve water quality control and conveyance capacity of the channel.

ES6089 Applegate Stormwater Management Facility Remediation Works

Provide remediation of the existing Applegate SWMF to improve hydraulic and hydrological performance. SWMF located adjacent to the Environmental Sensitive Area and Dingman Creek.


53

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total

400 400 400 400 400 400 2,000 4,400

100 100 100 100 100 900 1,400

150 300 450

Reserve Fund $12 Development Charges 288 Total Financing $300

An annual program to accurately assess the condition and identify deficiencies within an existing sewer pipe for rehabilitation and replacement programs. Construction Administration provides this investigation service for various divisions of the EES Department.



($000's)

Service Grouping: Wastewater and Treatment Category: Non-TCA Capital

An annual program to provide grants for privately installed sump pumps, backwater valves, sewer ejector and storm sewer private drain connections.

ES2092-12 Sump Pump Grant Program

ES1825-12 Video Inspection

ES2450 Wastewater and Treatment Master Plan

To undertake the Wastewater and Treatment Master Plans for the entire City and to consolidate all constructed and proposed Wastewater and Treatment infrastructure. Growth splits are consistent with the 2009 Development Charge Study. 100% Growth Related (94.7% DC Rate Supported).


2012 Financing:

54

Prior Years 2011 2012 2013 2014 2015 2016

2017 to 2021 Total


($000's)

Service Grouping: Wastewater and Treatment Category: Non-TCA Capital

840 460 1,300

0

990 400 1,260 500 500 500 500 2,900 7,550

68,157 58,142 58,444 59,308 52,153 47,549 65,978 255,197 664,928


Total Non-TCA Capital

ES2470 Adoption of Climate Changes Strategy

Implementation of an Adoption of Climate Changes Strategy undertaking the required Engineering studies for Phase I and II.


Total Wastewater and Treatment


2012 Reserve Funds and Reserves


55


Reserve Funds and Reserves

Sewage Works Actual Projected ProposedReserve Fund 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 30,100 36,790 7,705 5,425 5,503 5,869 8,558 7,717Contributions 15,877 14,826 16,723 18,381 19,831 21,767 23,982 87,228Additional Contribution (surplus and account closing) 2,345Interest earned 510 441 130 108 113 143 161 2,787

$48,832 $52,057 $24,558 $23,914 $25,447 $27,779 $32,701 $97,732Drawdowns - Current Year 7,059 17,416 19,133 18,411 19,578 19,221 24,984 48,579Drawdowns - Prior Years 4,983 26,936Total Drawdowns (1) $12,042 $44,352 $19,133 $18,411 $19,578 $19,221 $24,984 $48,579Ending Balance $36,790 $7,705 $5,425 $5,503 $5,869 $8,558 $7,717 $49,153Notes:(1) Drawdowns are based on full capital needs and not intended to project the actual cash flow of funds being utilized in a particular year.

Industrial Oversizing Sewer Actual Projected ProposedReserve Fund (1) 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 5,864 6,494 5,649 6,539 6,817 6,914 6,801 5,032Contributions 3,254 3,254 1,500 1,500 1,500 1,500 1,500 11,500Interest earned 68 120 121 132 136 136 118 519

$9,186 $9,868 $7,270 $8,171 $8,453 $8,550 $8,419 $17,051Debt Servicing Cost-Existing Debt 1,299 1,269 731 324 0 0 0 0Debt Authorized but not Issued 0 0 811 1,199 1,199 1,199 5,995Forecasted Future Debt 0 0 0 0 0 0 0Drawdowns - Current Year 304 32 0 219 340 550 2,188 3,872Drawdowns - Prior Years 1,089 2,918Total Drawdowns (2) $2,692 $4,219 $731 $1,354 $1,539 $1,749 $3,387 $9,867Ending Balance $6,494 $5,649 $6,539 $6,817 $6,914 $6,801 $5,032 $7,184Notes:(1) This reserve fund was established to provide funding for the servicing costs in Industrial Developments and oversizing in growth projects.(2) Drawdowns are based on full capital needs and not intended to project the actual cash flow of funds being utilized in a particular year.

($000's)Forecast

Forecast

56


Reserve Funds and Reserves($000's)

Sewage Treatment Plant Capacity Actual Projected ProposedReserve Fund (1) 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 3,214 4,301 2,270 3,232 3,157 4,277 5,419 6,584Contributions 1,046 1,046 1,046 1,046 1,046 1,046 1,046 13,230Interest 41 65 54 63 74 96 119 870

$4,301 $5,412 $3,370 $4,341 $4,277 $5,419 $6,584 $20,684Drawdowns - Current Year 0 0 138 1,184 0 0 0 16,144Drawdowns - Prior Years 0 3,142Forecasted Future Debt 0 0 0 0 0Total Drawdowns $0 $3,142 $138 $1,184 $0 $0 $0 $16,144Ending Balance $4,301 $2,270 $3,232 $3,157 $4,277 $5,419 $6,584 $4,540Notes:

City Services Sanitary Sewer Levies Actual Projected ProposedReserve Fund 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 11,767 13,104 2,015 3,880 1,780 3,807 5,515 6,487Levies 4,758 4,803 5,001 5,388 5,576 5,764 5,764 28,820Interest 151 150 58 56 55 92 119 357

$16,676 $18,057 $7,074 $9,324 $7,411 $9,663 $11,398 $35,664Refunds 12 92Growth portion - Existing Debt Repayment 1,261 1,217 1,146 1,110 919 847 812 774Growth portion - Debt authorized - Not issued 0 950 1,182 1,640 3,189 3,188 15,940Forecasted Future Debt 0 0 0 0 62 62 6,345Drawdowns - Current Year 209 7,349 1,098 5,252 1,045 50 849 11,792Drawdowns - Prior Years 2,090 7,384Total Drawdowns (1) $3,572 $16,042 $3,194 $7,544 $3,604 $4,148 $4,911 $34,851Ending Balance $13,104 $2,015 $3,880 $1,780 $3,807 $5,515 $6,487 $813

(1) Drawdowns are based on full capital needs and not intended to project the actual cash flow of funds being utilized in a particular year.Notes:

(2) Effective August 4, 2009 Council approved the adoption of the new Development Charge policy, a component of which is directed to Sewer Services. Development charges reduce the demands on sewer rates with respect to funding capital requirements for growth related expenses. At times, it may be necessary to finance these growth related capital requirements through issuance of debt. Future payments on this debt will be financed through capital development charges.

Forecast

Forecast

(1) The Sewage Treatment Plant Capacity Reserve Fund was established in 2007 to provide a funding source for the sewage treatment plant capacity in order to eliminate the need for the more costly option of issuing debenture financing, consistent with the Corporate Strategic Financial Plan adopted by Council.

57



City Services Major SWM Levies Actual Projected ProposedReserve Fund 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 1,296 4,349 1,969 1,789 2,396 2,399 1,848 1,772Levies 4,814 5,066 5,183 5,555 5,727 5,900 5,900 29,500Interest 44 63 37 41 47 42 36 145

$6,154 $9,478 $7,189 $7,385 $8,170 $8,341 $7,784 $31,417Refunds 12 5 0Growth portion - Debt authorized - Not issued 0 0 632 1,346 2,363 3,318 3,318 16,590Forecasted Future Debt 0 0 0 0 853 1,485 1,485 13,184Drawdowns - Current Year 1,144 5,029 4,768 3,643 2,555 1,690 1,209 1,528Drawdowns - Prior Years 649 2,475Total Drawdowns (1) $1,805 $7,509 $5,400 $4,989 $5,771 $6,493 $6,012 $31,302Ending Balance $4,349 $1,969 $1,789 $2,396 $2,399 $1,848 $1,772 $115

(1) Drawdowns are based on full capital needs and not intended to project the actual cash flow of funds being utilized in a particular year.

Wastewater Rate Actual Projected ProposedStabilization Reserve (1) 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 1,831 1,831 1,831 1,831 1,831 1,831 1,831 1,831Contributions 0

$1,831 $1,831 $1,831 $1,831 $1,831 $1,831 $1,831 $1,831Drawdowns 0 0 0 0 0 0 0Ending Balance $1,831 $1,831 $1,831 $1,831 $1,831 $1,831 $1,831 $1,831Notes:(1) This reserve was established to assist with future year shortfalls in revenue and/or emergency expenditures in the wastewater operating budget. The reserve balance may increase/decrease subject to the 2011 year end operating position.

($000's)Forecast

Forecast

Notes:

(2) Effective August 4, 2009 Council approved the adoption of the new Development Charge policy, a component of which is directed to Storm Water Management Services. Development charges reduce the demands on sewer rates with respect to funding capital requirements for growth related expenses. At times, it may be necessary to finance these growth related capital requirements through issuance of debt. Future payments on this debt will be financed through capital development charges.

58



Efficiency, Effectiveness, and Economy Actual Projected ProposedReserve 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 486 613 613 613 613 613 613 613Contributions 127 0

$613 $613 $613 $613 $613 $613 $613 $613Drawdowns 0 0 0 0 0 0 0 0Ending Balance $613 $613 $613 $613 $613 $613 $613 $613

Sump Pump, Sewage Ejector and Actual Projected ProposedStorm PDC Program Reserve Fund (1) 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 0 500 510 520 530 541 552 563Contributions - Surplus 500 0Interest 0 10 10 10 11 11 11 58

$500 $510 $520 $530 $541 $552 $563 $621Drawdowns 0 0 0 0 0 0 0Ending Balance $500 $510 $520 $530 $541 $552 $563 $621Notes:

Disconnection of Sewer Cross-Connection Actual Projected ProposedLoan Program Reserve Fund (2) 2010 2011 2012 2013 2014 2015 2016 2017 - 2021

Opening Balance 0 0 101 103 105 107 109 111Contributions - Surplus 0 100Interest 0 1 2 2 2 2 2 10

$0 $101 $103 $105 $107 $109 $111 $121Drawdowns 0 0 0 0 0 0 0Ending Balance $0 $101 $103 $105 $107 $109 $111 $121Notes:(2) This reserve fund was established in 2011 to provide funding for the Sewer Cross-Connection Loan Program to provide financial assistance to those residential dwellings with a confirmed cross-connection to an existing storm sewer that services that street. Repayment will be made over 10 years.

Forecast

($000's)

Forecast

Forecast

(1) This reserve fund was established in 2009 to provide funding for the Grant Program for Sump Pump, Sewage Ejector and Storm Private Drain Connection or other mechanisms or capital works to fund protection from basement flooding, once the balance of the capital project for the current year has been exhausted.


2012 Debt Summary


59

Capital Projects Funded by Rate Supported Debentures 7.9 4.6 2.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Annual Debt Servicing Costs 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Wastewater Budget - Rate Supported 13.2 13.3 13.8 14.7 14.9 15.1 14.6 14.5 14.2 14.0

Annual Debt Servicing Costs Through Industrial Oversizing Reserve Fund 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Wastewater Budget - Rate Supported 0.7 1.1 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2

The capital financing plan that supports the 20 Year Wastewater System Plan relies on rate increases of 7.0% for 2012 -2016,4.0% for 2017 and modest rate increases of 3.0% per year thereafter. This will ultimately result in reduced debt financing andcontinue the shift to more pay-as-you-go funding.

($ millions)

2015 2016 2017 2018

At December 31, 2011, the Wastewater debt outstanding will be approximately $86.5 million with $43.3 million authorized butunissued. With the proposed capital plan, along with the existing debt outstanding, the Wastewater debt repayment for 2012will total $13.2 million. Debt servicing costs are anticipated to increase to $15.1 million by 2017 with the issuance of theremaining authorized but unissued and the proposed debt financing associated with the 2012 capital budget and forecast.

Industrial Oversizing Reserve Fund Debt: At December 31, 2011, the Industrial Oversizing Sewer Reserve Fund will haveapproximately $3.2 m of debt outstanding with $9.5 million authorized but unissued. Debt Servicing costs are anticipated toincrease to $1.2 million by 2014 with the issuance of the remaining authorized debt.

2014


Debt Summary - Rate Supported

2019 2020 2021

The Wastewater and Treatment capital budget forecast includes debt financing of $15.2 million as part of the 2012 - 2021capital plan as highlighted below, this represents a $ 1.4 million increase in debt financing over what was forecasted last year.

Projected Debt Financing (Rate Supported) 2012 2013

60

Capital Projects Funded by Non Rate Supported Debentures 7.3 6.9 7.4 5.6 13.6 10.0 4.0 0.7 11.5 12.2

Annual Debt Servicing Costs funded through DC's 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Wastewater Budget - Non Rate Supported (DC) 2.7 3.6 5.8 8.9 8.9 10.1 9.4 10.0 11.0 12.3

($ millions)


Debt Summary - Non Rate Supported

The Wastewater and Treatment capital budget forecast includes non rate supported (DC) debt financing of $79.2 million as partof the 2012 - 2021 capital plan as highlighted below. This represents a $13.1 million increase in debt financing over what wasforecasted last year predominantly due to lower projected development charge revenues.

Projected Debt Financing (Non Rate Supported) 2012 2013 2014 2015

At December 31, 2011, the total net Wastewater debt outstanding will approximately be $23.8 million with $38.9 millionauthorized but unissued.

The debt projections above are based on a modest pace of spending against approved capital project budgets and theproposed capital plan, consistent with recent experience. If the pace of spending increases, debt will be issued sooner, and thetotal debt outstanding along with the annual debt servicing costs could exceed current projections.

Non rate supported debt in the Wastewater and Treatment budget is funded through Development Charges in accordance withthe 2009 DC Background Study rather than sewer rates. The funding of this debt by applicable reserve fund is identified in thereserve fund section of the 2012 Wastewater & Treatment Budget package.

2016 2017 2018 2019 2020 2021


2012 Schedule of Rates and Charges

61



Effective Dates

Sanitary Sewer System ChargeComes into effect on January 1, 2012.

Storm Drainage System ChargeComes into effect on January 1, 2012.

Miscellaneous ChargesComes into effect on January 1, 2012.

Monthly Rates and Charges

2011 2012 2011User Group ($/m3) ($/m3)Residential 1.54688 1.65516 $11.65 $12.47 /MonthlyCommercial 0.93885 1.00457 $14.07 $15.05 /MonthlyInstitutional 0.68889 0.73711 $11.24 $12.03 /MonthlyInstitutional over 600,000 m3 0.56561 0.60520 (3) $11.24 $12.03 /MonthlyIndustrial 0.63194 0.67618 $1,170.39 $1,252.32 /Hectare/YearIndustrial 600,000 - 1.2 Million m3 0.53073 0.56788 (3) $995.01 $1,064.66 /Hectare/YearIndustrial over 1.2 Million m3 0.44833 0.47971 (3) $995.01 $1,064.66 /Hectare/Year

(1) The Sanitary Sewer System Charge is based on metered water consumption.(2)

(3) Special customer classifications for large water users, based on previous year's total water consumption in cubic meters.

2012 Storm Drainage System Charge (2) Sanitary Sewer System Charge (1)

Flat rate charge for storm drainage for residential, commercial, institutional customers and charges for industrial customers based on lot area all appear on London Hydro billing.

62


2011 Approved Rates 2012 Proposed Rates

Sanitary Main Sewers (1) $168.66/m frontage $180.47/m frontage

Single Family (2) $156.15/m frontage $167.08/m frontage

Multi-family (3) $312.29/m frontage $334.15/m frontage

$9.61 per 1,000 Litres $10.28 per 1,000 Litres

Leachate $17.68 per 1,000 Litres $18.92 per 1,000 Litres

$0.445/m3 $.476/m3

(1) Based on calculated frontage.(2) Rate applicable to single family, two family or duplex dwelling units.(3) Rate applicable to multi-family, commercial or industrial properties.


High Strength Sewage Service Rate

Miscellaneous Rates and Charges

Description

Sewer Rental

Storm Main Sewers

Hauled Liquid Waste Disposal Rates (except leachate)

london · increase in administrative, other, and recovered expenses and purchased services offset...

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