Selling water to the West Bench

[Michael Brydon]

I see in todays Castanet news the touting of the 24 million upgrade to Penticton's sewage treatment plant and it's readiness for possible future connection to the WB and Sage Mesa.

Yes, I saw that too, but it is news to me. The last time the RDOS looked at sewer for the West Bench was in 2005. The engineering report can be found on the Area F site. Conclusion: Too much pipe for too few homes. And when we surveyed West Bench residents on the topic (p. 45), the vast majority of respondents either did not support sewer or would only support sewer if densities on the West Bench remained unchanged (which is effectively the same as being against sewer, given the costs involved).

I can see why the City of Penticton would want to sell capacity at its liquid waste treatment plant to its rural neighbours (the economics of a high-fixed-cost facility has already been discussed at length in this thread). But no neighbour is going to buy that capacity if it is priced above the market price. And the market price, as its name suggests, is determined by the market--that is, by the existence of alternatives. The market price is NOT determined, as some here apparently believe, by an accountant in the bowels of Penticton City Hall.

This sewage treatment plant story reminds me of the condo developers on Skaha Lake Road: they built massively for customers who they believed would buy the units at a particular price. As it turns out, buyers were not willing to pay that price (pesky free market economy). Given that the costs of the buildings are largely sunk, these builders have two options: (a) sell their excess capacity at the market price, whatever that is or (b) hold on in the hope that someone someday will pay what they believe is a fair price.

What was that about wanting only 7% of our water filtration capacity again? I am going to be a prophet like you were above with your vision for the SOEC and Pen Hi auditorium and predict you will hook into the sewer system only if it is at a dicounted rate. That will be because we have the excess capacity and some payment would be better than nothing......a no brainer right?

You are using the word "discounted" like you know what it means. Discounted relative to what? Please explain.

[twobits]

I am done with this topic Micheal. I think my view is perfecly clear and there is no point in throwing rocks back and forth. I've got to give you one thing though, you are a very good rep for your neighbours. I'd actually like to see someone of your calibre on Penticton Council fighting for Penticton citizens.

[Michael Brydon]

We also build for peaks, not averages. Just as we size storm sewers for the rare ten year storm, we sized our filtration capacity to provide for those peak summer days.

Okay, but as you may be aware this statement runs exactly contrary best practices for water management in Penticton and other communities. Peaks are discretionary watering. Obviously, if a community can get by with 20 ML/day for most of the year but all of a sudden consumes 50 ML/day in late July, the target of all this water must be shrubs, lawns, and perhaps the occasional slip 'n slide.

The task facing water purveyors is to manage the peaks (e.g., even-odd watering, time restrictions, peak charges, etc.) rather than indulge the peaks with massive overbuilding. Pretty much every community in North America is working aggressively to reduce peak demand. But if you want to give up $7M so you are absolutely certain your lawn will never have a dry patch from July 20 to July 30, then I guess that is your decision. It is not like Penticton has massive debt to pay off or anything.

Of course, the comparison to storms is inapt because storms are not the result of discretionary human behaviour.

[Michael Brydon]

And I take exception to your comment, Mr. Brydon, about the 9-1-1 Dispatch service that went to a larger center. I believe that it was the Regional District that failed to keep up their end of the bargain in keeping technology up-to-date in the Penticton Center, which allowed another Center to do the job at a cheaper rate.

Okay, I'll bite. The RDOS funds its activities through the collection of taxes--there are no other sources of revenue for the 911 service. No hidden reserve funds, no rich uncle; no off-shore oil and gas royalties. As such, when you say "the RDOS" you really mean "local taxpayers".

Given this, let's restate your argument above: Local taxpayers did not buy Penticton fire dispatch the technology required to enable Penticton to provide local taxpayers with a competitive price for 911 service. Hmmm. Is this not the point? Exploiting economies of scale in dispatch (as many communities in BC have done already) allowed local taxpayers to avoid a major investment in new technology. Are you unhappy about this? I am a bit confused.

Don't get me wrong: There is nothing more difficult than making changes that result in people losing their jobs. But there are two sides to this. My brother Don could no longer afford to do business in Cherry Lane Mall and had to shut down a store that had been in continuous operation for 26 years (with obvious impacts on this staff). I do not recall anyone suggesting that we should use taxpayers money to keep his store open. I suppose the same goes for Mayor Ashton when he had to close his family's stores circa 2007. Where were the letters to the editor demanding taxpayer subsidies to preserve jobs at Ashton's Ladies Wear? One set of rules for everyone, right?

Footnote: The City of Penticton pays roughly 42% of the cost of the 911 service (like most regional services, costs are recouped based on assessed property values). However, it turns out that Penticton is responsible for 62.51% of calls to the service. But who is counting?

And we all know that the City threw the bid. They wouldn't want to admit that they were totally inept in what they submitted, now would they? They shouldn't have been allowed to re-sharpen their pencils.

I don't know what this means "threw the bid". Could you explain? Also, I am not sure the City of Penticton dispatchers are inept (by all accounts they were fantastic). Unfortunately, other dispatch centers had economies of scale on their side. Which brings us back to the West Bench water issue: How can Penticton have economies of scale on its side for water treatment and still be the high bidder?

[twobits]

If we could just cut you off when we required the capacity that WB will demand, then I would give you your deal. Unfortunately, you need security of supply so that's not possible. I don't know why you won't try to see the other side of the coin? The 3.5 mil in capital cost contribution will be realized by the city eventually anyway thru DCC's. Your forgone capacity may well bring even more than that even discounted back to today's dollars. Your ongoing payments for the cost of filtration will also be matched by eventual users within the city and those eventual users will also be living in homes or operating businesses within Penticton city limits paying a parcel tax (revenue) to the city that you never will. (Here is where you bring back your population growth theories that you can only extrapolate and not guarantee).

Like I said, if we could just cut you off when we reach the tipping point, fine, but under your proposal I feel we are taking too much of a chance with our future needs. I note as well you chose to skip over my comment about reopening your 20k annual payment for the community centre. That too was Penticton selling future capacity. Sure looks like Penticton got the smelly end of the stick on that deal and exactly why we should be very cautious about selling a la carte services to WB or anyone else.

Perhaps the proposal could be reworked somehow to be an agreement for 10 years with 4 options for renewal, Capital cost contribution would similarily be adjusted. Each decade, with proper notice both sides can examine current costs and options and renew or go separate ways. There is nothing to say you couldn't take back the water liscense and build your own system ater ten years. That would be part of your cost analysis and a sharing of the risk of looking forward 50 yrs. Perhaps you could even secure lower rates under such a senario because then we truly are selling current excess capacity with certainty.

[Michael Brydon]

If we could just cut you off when we required the capacity that WB will demand, then I would give you your deal. Unfortunately, you need security of supply so that's not possible.

The regime of water licenses in British Columbia is based entirely on the notion of volume-based quotas, or hard limits on consumption. For creek-fed jurisdictions such as Summerland and South East Kelowna, hard limits are a hydrological fact of life. I wrote earlier that the proposed contract with Penticton is for a fixed amount of water. What is "not possible" here? Please elaborate.

The 3.5 mil in capital cost contribution will be realized by the city eventually anyway thru DCC's. Your forgone capacity may well bring even more than that even discounted back to today's dollars. Your ongoing payments for the cost of filtration will also be matched by eventual users within the city and those eventual users will also be living in homes or operating businesses within Penticton city limits paying a parcel tax (revenue) to the city that you never will. (Here is where you bring back your population growth theories that you can only extrapolate and not guarantee).

There is a growing movement in business, government, and healthcare (where the term was coined) towards "evidence-based" decision making. The idea is that lots of things are possible (for example, it could rain beer). However, only some things are probable.

The City of Penticton could grow sufficiently in the next few decades to require the 75% of the water treatment capacity that is currently idle. But, to repeat a question I asked earlier, what evidence suggests that this will happen? How can current trends (graph shown previously) be interpreted to support this assertion? Sure, such growth is possible, but it it probable?

Of course, there are other important issues. Penticton could recoup some of its sunk costs in water treatment if its population doubled or tripled. But where are all these people going to live? What are they going to use for a hospital? Where are the schools going to come from? Do local residents really want 2X density? If you really believe that Penticton will experience enough of a population boom within city limits to justify its current WTP capacity, then it follows that the city needs to get work right now on the core infrastructure (apart from water) that is absolutely essential to support this growth.

[Stellerjay]

If we could just cut you off when we required the capacity that WB will demand, then I would give you your deal. Unfortunately, you need security of supply so that's not possible.

The regime of water licenses in British Columbia is based entirely on the notion of volume-based quotas, or hard limits on consumption. For creek-fed jurisdictions such as Summerland and South East Kelowna, hard limits are a hydrological fact of life. I wrote earlier that the proposed contract with Penticton is for a fixed amount of water. What is "not possible" here? Please elaborate.

The 3.5 mil in capital cost contribution will be realized by the city eventually anyway thru DCC's. Your forgone capacity may well bring even more than that even discounted back to today's dollars. Your ongoing payments for the cost of filtration will also be matched by eventual users within the city and those eventual users will also be living in homes or operating businesses within Penticton city limits paying a parcel tax (revenue) to the city that you never will. (Here is where you bring back your population growth theories that you can only extrapolate and not guarantee).

There is a growing movement in business, government, and healthcare (where the term was coined) towards "evidence-based" decision making. The idea is that lots of things are possible (for example, it could rain beer). However, only some things are probable.

The City of Penticton could grow sufficiently in the next few decades to require the 75% of the water treatment capacity that is currently idle. But, to repeat a question I asked earlier, what evidence suggests that this will happen? How can current trends (graph shown previously) be interpreted to support this assertion? Sure, such growth is possible, but it it probable?

Of course, there are other important issues. Penticton could recoup some of its sunk costs in water treatment if its population doubled or tripled. But where are all these people going to live? What are they going to use for a hospital? Where are the schools going to come from? Do local residents really want 2X density? If you really believe that Penticton will experience enough of a population boom within city limits to justify its current WTP capacity, then it follows that the city needs to get work right now on the core infrastructure (apart from water) that is absolutely essential to support this growth.

Who's says we should grow? This idea that we are going party hard on finite resources is ridiculous. You talk about evidence based decision making based within what context? An abstract economic system? or physical reality?. If its physical reality we're talking about here then we need to look into the possible effects Climate Change will have on our water supply and there has already been a couple studies on it. Here is the one I bought.

http://www.sciencedirect.com/science/ar ... 9405005573

[twobits]

Stellar, I understand and respect your desire for no growth even though I do not agree. I wonder though how you would propose we stop any more people from moving here if they so desire?

[Stellerjay]

Stellar, I understand and respect your desire for no growth even though I do not agree. I wonder though how you would propose we stop any more people from moving here if they so desire?

Lower the growth rate to 0% as a bylaw or in the community plan.

[twobits]

Stellar, I understand and respect your desire for no growth even though I do not agree. I wonder though how you would propose we stop any more people from moving here if they so desire?

Lower the growth rate to 0% as a bylaw or in the community plan.

Can you be a little more forthcoming here? What kind of bylaw can tell people they cannot move here? How can you prevent people from moving here via a community plan? Sorry but I can't follow your logic here.

[Michael Brydon]

This idea that we are going party hard on finite resources is ridiculous. You talk about evidence based decision making based within what context? An abstract economic system? or physical reality?. If its physical reality we're talking about here then we need to look into the possible effects Climate Change will have on our water supply and there has already been a couple studies on it. Here is the one I bought.

Two things:

First, the West Bench already draws water from Okanagan Lake. West Bench has its own water licences--I thought this was well established previously in this thread. So to repeat the physical reality: the proposed deal with the City of Penticton involves no net change in water consumption and thus no net change in hard partying. It is really just a question of treatment technology.

Second, to be fair, population growth per se is not necessarily the water boogyman in this region. Take a look at the results from the Okanagan Basin Water Board's supply and demand model (Dr. Denise Neilson from Ag Canada, who is listed as an author on the paper you cite above, is also involved in many of the initiatives of the OBWB): http://www.obwb.ca/wsd/key-findings/water-use. Then keep in mind that much of the water used for indoor residential uses in Penticton goes down the drain, into the sewage treatment plant, and out the pipe into the river channel ("return flows" stay in the basin).

Residential outdoor watering (recall the discussion about Peak Day above) is a more serious problem in the Okanagan due to evaporation. Hence the increased push towards xeriscaping yards.

[Stellerjay]

This idea that we are going party hard on finite resources is ridiculous. You talk about evidence based decision making based within what context? An abstract economic system? or physical reality?. If its physical reality we're talking about here then we need to look into the possible effects Climate Change will have on our water supply and there has already been a couple studies on it. Here is the one I bought.

Two things:

First, the West Bench already draws water from Okanagan Lake. West Bench has its own water licences--I thought this was well established previously in this thread. So to repeat the physical reality: the proposed deal with the City of Penticton involves no net change in water consumption and thus no net change in hard partying. It is really just a question of treatment technology.

Second, to be fair, population growth per se is not necessarily the water boogyman in this region. Take a look at the results from the Okanagan Basin Water Board's supply and demand model (Dr. Denise Neilson from Ag Canada, who is listed as an author on the paper you cite above, is also involved in many of the initiatives of the OBWB): http://www.obwb.ca/wsd/key-findings/water-use. Then keep in mind that much of the water used for indoor residential uses in Penticton goes down the drain, into the sewage treatment plant, and out the pipe into the river channel ("return flows" stay in the basin).

Residential outdoor watering (recall the discussion about Peak Day above) is a more serious problem in the Okanagan due to evaporation. Hence the increased push towards xeriscaping yards.

I apologize for jumping the gun. Thank you for sharing the website by the way it`s very informative.

[Stellerjay]

Stellar, I understand and respect your desire for no growth even though I do not agree. I wonder though how you would propose we stop any more people from moving here if they so desire?

Lower the growth rate to 0% as a bylaw or in the community plan.

Can you be a little more forthcoming here? What kind of bylaw can tell people they cannot move here? How can you prevent people from moving here via a community plan? Sorry but I can't follow your logic here.

I`m not preventing anyone from moving here, I would simply not allow the building of any new housing developments I would put it before the residents of this city with intent of capping our population. Naramata had a 0.1% growth rate stated by it`s community plan for a number years.

[twobits]

Second, to be fair, population growth per se is not necessarily the water boogyman in this region.

No it is not but it is easy to understand how people come to that conclusion. As you correctly point out, it is not the numbers of people that will strain water supply, it is how those numbers of people use (waste) water. Unfortunately I don't think people are going to significantly change their habits until water's price elasticity changes. It is currently viewed as such a cheap commodity that even doubling the price has little effect on demand.
Human behaviour is curious in this regard. We complain about the natural gas bill going up, the electric bills going up and the water bills going up. Most react to this by turning down the thermostat, turning off the lights and using CF's, but when it comes to water, we still hose off the driveway and turn on the sprinklers to keep 5,000 sq ft of non indiginous fescue and bluegrass green.
We really don't have a water shortage. Estimates show that the Okanagan Basin is capable of supporting a population in the 2 million range. We currently sit at about 500k I believe. Our current water conservation efforts, (odd/even sprinkling, xeriscaping, etc) are not about conserving the resource per se as much as they are about best utilizing the distribution network during peak periods and postponing the very expensive upsizing of that infrastructure.

[twobits]

I`m not preventing anyone from moving here, I would simply not allow the building of any new housing developments I would put it before the residents of this city with intent of capping our population. Naramata had a 0.1% growth rate stated by it`s community plan for a number years.

We've gotten a tad off topic here but it is an interesting discussion. I won't berate you for your desire for no growth, that is your privledge. I would point out however that doing such things as not allowing any new housing developments is a double edged sword with definite consequences. Besides sigificantly eliminating a huge amount of jobs, artificially restricting supply while there is still a desire for people to relocate to our amazing valley will drive housing costs thru the roof by people with the means bidding up the prices of limited supply. If you think housing cost is out of reach for many now, I shudder to think of what it would become. While you may be successful in capping your population, you would make Penticton a playground for the rich only and is that really what you would like? Being significantly invested in real estate here, your policy would have me laughing all the way to the bank so I should embrace your idea......but I don't.....because it would destroy the fabric of the community and ruin so many lives. IMO of course.