Selling water to the West Bench

[Michael Brydon]

As you may know, the West Bench (part of the area I represent in Area ‘F’ of the RDOS) is trying to put together a deal with the City of Penticton to buy filtered water. This is a tricky issue so I thought I would throw it out there for your comments. It seems to me that this should also be an election issue given the dollars and general principles at stake.

The issue is tricky for one simple reason: The City of Penticton draws some of its water from Penticton Creek. Although this arrangement exploits gravity and saves pumping costs, the use of creek water means that the City of Penticton has had to build a very costly water filtration plant. The West Bench, in contrast, draws its water from an intake deep (though not quite deep enough) in Okanagan Lake. As the new RDOS-operated ultra-violet treatment plant in Naramata has shown, filtration is unnecessary when the incoming water quality is high.

West Bench residents therefore have a choice: They can (a) build their own ultra-violet treatment system and continue to draw water from their license on Okanagan Lake or (b) buy bulk filtered water from Penticton. (note: this “bulk water” deal is different from the outright takeover of the West Bench water system by Penticton that was rejected by West Bench voters last year) The problem is that Penticton’s average cost for water (that is, the total cost of is water treatment plant divided by the amount of water it treats) is apparently HIGHER than the average cost of water from a brand new UV treatment plant. The possibility of building a standalone UV plant naturally puts a ceiling on the amount that West Bench residents are willing to pay for water—why would they buy expensive filtered water when they can satisfy Interior Health’s water quality standards with a cheaper alternative?

But here is the catch for Penticton: the city’s water treatment system is bought and paid for. Its system has plenty of excess capacity and could easily provide filtered water for the West Bench (West Bench consumption would be just under 7% of the total Penticton output). The actual marginal cost to the City of Penticton of servicing West Bench would be almost negligible. Put differently, the City of Penticton is paying for its excess capacity whether it sells the water or not. It therefore seems wasteful (at least to me) that the RDOS would build a new UV treatment plant a few meters away from Penticton’s city limits.

My question to participants in this forum is whether they would be willing to accept a deal in which West Bench residents (who pay taxes, but not to the City of Penticton) could buy water from Penticton at what might legitimately be perceived to be a discount? If Penticton is not in favor of the deal, the RDOS will build its own UV treatment plant and the issue will be resolved. If, on the other hand, Penticton is willing to make a deal, the RDOS will pay the money it would have used to build a new standalone system to the City of Penticton. In case you are interested, the numbers being bandied around at this point are an initial buy-in fee of about $3.5 million and an annual fee of about $130,000. I should point out that we are talking about a pre-arranged quantity of metered water for a pre-arranged price (no one is contemplating an “open tap” for West Bench residents).

Again, I am just throwing this out there to find out what people think and find out what the sticking points might be. This is a tricky issue because it seems to put basic notions of fairness in conflict with economic rationality. Penticton City Council is well aware of this conflict and, as a consequence, is moving very carefully on the issue. I am a bit less patient (the West Bench is, after all, under a boil water notice) and want to know ASAP whether there is support in Penticton for a deal or not so that we can get moving on the upgrade project. As noted above, the price West Bench residents pay is the same whether we build our own system or buy Penticton water.

One final note on the issue of fairness: West Bench residents are getting no "deal" in the larger sense. Even with the cheapest possible water treatment option (currently UV) the residential water rate paid by West Bench residents after the upgrade is going to be in the neighborhood of $2000/year. Rural living ain't as cheap as it used to be...

Thanks in advance for your input on this,
/M
Michael Brydon ([email protected])
Director, Electoral Area 'F'
Regional District of Okanagan-Similkameen

[XT225]

If Penticton were to sell bulk water to Westbench, wouldn't that be like "reducing" prices to the Community Centre Pool for Westbench residents? Didn't Penticton pay for their own treatment plant with our tax dollars (and maybe some grant funds). Are you sure that UV only, is the way to go? Why did Penticton not go UV instead of filtration (I'm asking cause I don't honestly know). I would be "twinning" the water systems on the bench if I were you, then only using treated water for domestic useage; costly, but in the long run might be the best route.

[Michael Brydon]

Hmm, I went away to compose a response to a post and the post is now gone ! Yanked by the moderators? Too bad, it raised some good points that are worth addressing.

The first point in the deleted post was: "what does this topic have to do with the election?" My response is: I decided to post it under the election topic because (a) this forum seems to be getting more traffic and (b) I thought Pentictonites would want to discuss the major issues facing its incoming council prior to the election. The economic stake for Penticton in this deal is about $7 million (PV over 50 years at 6% interest and 3% inflation). Certainly not the biggest piece of business before the incoming council, what happens in the next few months with West Bench is bound to provide the template for future deals (or non-deals) involving the Sage Mesa water system and perhaps even rural sewer. As is clear from the local papers, folks in this town have differing opinions regarding Penticton’s relationship to its near rural neighbours.

The second issue raised by the missing post was a "Plan C" for West Bench. The assertion made by the poster was that ultra-violet treatment would never work for the West Bench because it did not work in the North Okanagan (and those dumb politicians should have known better, etc.).

Please recognize that the Duteau Creek treatment facility in the North Okanagan Regional District is quite different from what is being proposed for the West Bench (or what has already been accomplished in Naramata). As its name suggests, the source for the Duteau Creek plant is a creek. The source for the West Bench system is a deep lake intake—a source that the West Bench has been using for decades and for which significant longitudinal data exists. We also have significant data on the quality of water at the Sage Mesa water intake.

The criteria for satisfying IHA’s criteria for filtration deferral are well-known and Naramata already meets these criteria. The basis of comparison is thus a RDOS water system on the same lake at roughly the same latitude, not an upland creek-based system in the middle of Coldstream cattle country with known water quality problems.

Also, it is not quite fair to criticize the North Okanagan Regional District for the ongoing boil water situation for the new Duteau Creek treatment plant. The plan is and always has been to build a filtration component into the treatment train (see http://www.rdno.ca/docs/duteau_creek_information.pdf). After all, it is creek-based source—they need filtration for the same reason that Penticton and West Kelowna need filtration. The problem for Duteau Creek is that, as noted in my previous post, filtration is expensive. They are looking at $20 million just for the filtration element—money they just don't have.

[Michael Brydon]

Didn't Penticton pay for their own treatment plant with our tax dollars (and maybe some grant funds).

Yes, Penticton residents are paying for its treatment plant with fees and taxes (debt is still outstanding). The purpose of the $3.5 initial payment from the West Bench is to "buy in" to the existing infrastructure.

Are you sure that UV only, is the way to go?

No, water treatment technologies are changing all the time. UV happens to be cheap and now that its popularity is increasing in the US and Europe, we are gaining a better understanding of when it works and does not work. It does not work if the water has high turbidity (the micro-organisms can hide from the UV rays in the sediment particles). It works very well when the water is relatively clear (like Okanagan Lake)

Why did Penticton not go UV instead of filtration (I'm asking cause I don't honestly know).

The problem with creek water, especially during the spring and summer run-off is that it has too much color (suspended solids, etc.) for UV to be reliable. Moreover, even when Penticton draws only from the lake (which it has the option of doing), its intake is influenced by Penticton Creek. Penticton's turbidity readings are much higher than what the RDOS sees at the Sage Mesa intake or the Naramata intake.

I would be "twinning" the water systems on the bench if I were you, then only using treated water for domestic useage; costly, but in the long run might be the best route.

One would think. But the economics of this are pretty surprising. The cost of water treatment plants is largely fixed. Thus, once you have the plant it place, it costs very little to treat a megalitre of water (this is the whole basis for the West Bench proposal). Digging up roads to twin pipe, in contrast, is very expensive (just ask Summerland). It turns out to be much cheaper to apply treated water to agricultural land than to twin the system for treated and untreated water. Naramata is moving towards twinning, but only when it is digging up lines for maintenance anyway.

[XT225]

If Penticton were to sell bulk water to Westbench, wouldn't that be like "reducing" prices to the Community Centre Pool for Westbench residents? Didn't Penticton pay for their own treatment plant with our tax dollars (and maybe some grant funds). Are you sure that UV only, is the way to go? Why did Penticton not go UV instead of filtration (I'm asking cause I don't honestly know). I would be "twinning" the water systems on the bench if I were you, then only using treated water for domestic useage; costly, but in the long run might be the best route.

Michael, you didn't answer my first question above. Thank you for answering the others. I do believe that the goalposts for Interior Health may change (isn't that why Duteau Creek got caught off guard; I dont think they anticipated filtration); even Okanagan Lake is not immune to impurities and while the present bottom limit on tubidity is 1NTU (whatever the heck that is...I looked it up) if that figure were to change (you know the way the province is) would you not be in trouble with strickly UV? I still think buying in bulk from Penticton is the way to go at fair market value; same as we pay; no more; no less.

[spacecadet]

I am all for including West Bench in our water system, but I don't believe that we should have to pay for the upgrades to the infrastructure (which I believe in talking to residents that live there) has to be replaced as it's crumbling.

I don't think they deserve a "discount" We have had to pay for a top notch system for the past number of years It's a system that I appreciate very much as I had a number of family members that contracted "beaver fever" prior to our Treatment coming on line.

I also believe (and I am not a scientist by any means) that any waters taken from the Lake should have to go through the same rigorous filtration system. After years of pesticides being applied to the orchards surrounding our lake, they have leached down into our water system. And how many homes north of Penticton actually still dump sewage and gray water directly into our lake that makes it way downstream? If I lived on West Bench, I would want absolutely the best filtration system money could buy!

But, I don't live there. And as there is a cost to everything, if you want in, I guess you'll have to pay. And just because it's paid for, doesn't mean you should get in at a lower rate.

[Michael Brydon]

I do believe that the goalposts for Interior Health may change (isn't that why Duteau Creek got caught off guard; I dont think they anticipated filtration)

Again, I am not sure it is fair to say the RDNO was caught off guard with Duteau Creek. Look at the arial view of the plant (from the document referenced previously). I direct you specifically to the large vacant area in the middle of the treatment train labelled "future filtration plant":

[Michael Brydon]

I don't believe that we should have to pay for the upgrades to the infrastructure (which I believe in talking to residents that live there) has to be replaced as it's crumbling.

Under the "bulk water" deal under consideration, the City of Penticton has nothing to do with the West Bench infrastructure (which is indeed in need of an upgrade--that is a big part of the overall project). The RDOS will continue to own and maintain the entire system on behalf of West Bench residents and bill residents accordingly.

I don't think they deserve a "discount" We have had to pay for a top notch system for the past number of years It's a system that I appreciate very much as I had a number of family members that contracted "beaver fever" prior to our Treatment coming on line.

Yes, beaver fever is a problem in creek waters (Penticton experienced an outbreak of Giardia in 1986; this was the trigger for the construction of the filtration plant). UV treatment is known to be effective for inactivating Giardia and Cryptosporidium. Indeed, the new West Kelowna Powers Creek system uses UV after filtration for this purpose.

I also believe (and I am not a scientist by any means) that any waters taken from the Lake should have to go through the same rigorous filtration system. After years of pesticides being applied to the orchards surrounding our lake, they have leached down into our water system.

To me, it sound like you are saying that the West Bench should filter its water even though it does not have to just because Penticton has to. That is a bit like saying Penticton should have AirCare even though we have no smog just because Vancouver has to. Unfortunately, neither UV nor sand filtration have much impact on pesticides and other soluble nasties (see the threads on Sterile Insect Release).

[XT225]

Michael, I don't know much about Duteau Creek, other than what I heard on the news a while back. They appeared to be caught off guard by future stricter rules by Interior Health. Maybe they were indeed planning on filtration way down the road but could it be that I.H. has moved up their plans for stricter rules now, on turbidity? I honestly don't know; dont really care, as Im on Penticton water and very happy with it. You still didn't answer my question though, and I know its a tough one: If Penticton were to sell bulk water to Westbench, wouldn't that be like "reducing" prices to the Community Centre Pool for Westbench residents? I spoke to someone in Red Wing Resorts as I believe their water comes from the lake and is treated with chlorine and nothing else (I could stand to be corrected on that). The answer that I received was that Redwing is on First Nations lands and does not have to abide by the Interior Health guidelines. Yikes..thats a bit scarey for those residents; I sure wouldn't want to live there. Other cities (ie: Ok Falls and Oliver have wells I believe and aren't subject to the same rules as lake or creekwaters. I would love to hear other peoples opinions. Ok, I did bit of googling and found this link to the Vernon story. It explains it clearly. They were aware that they needed to build in filtration but were hoping to wait until 2015; appears that I.H. had other ideas. Ask questions, Michael, of Interior Health and get written answers; your constituents deserve nothing less. Don't be so sure that the goal posts won't change for lakewater just as has happened in Vernon. PS: twobits started a thread on this last year but there was very little interest in it for some reason. http://www.vernonmorningstar.com/news/118034199.html

[Darkre]

Does Penticton also aquire the water license the West Bench currently has in this deal? Water is a finite resource, if Penticton sells 7% of it's capacity to the West Bench then there is 7% less water available for future developments in Penticton. Developments that would actually contribute tax revenue to this city. While Penticton has excess capacity now, there is no telling how much water will be needed 10-20 years down the road as more people move to this area.

Why hasn't Option "C" been presented to the residents of the West Bench? Leave the RDOS and join Penticton.

[XT225]

Does Penticton also aquire the water license the West Bench currently has in this deal? Water is a finite resource, if Penticton sells 7% of it's capacity to the West Bench then there is 7% less water available for future developments in Penticton. Developments that would actually contribute tax revenue to this city. While Penticton has excess capacity now, there is no telling how much water will be needed 10-20 years down the road as more people move to this area.

Why hasn't Option "C" been presented to the residents of the West Bench? Leave the RDOS and join Penticton.

Good points, darkre. I believe that WB turned its nose up (voted it down) against the deal that Penticton offered them a while back; and according to what Michael Brydon says: "West Bench residents are getting no "deal" in the larger sense. Even with the cheapest possible water treatment option (currently UV) the residential water rate paid by West Bench residents after the upgrade is going to be in the neighborhood of $2000/year".
If the cheapest route IS the UV plant, and he feels that further treatment is unnecessary, why is he even asking the question of Penticton? Build your plant, and let Penticton keep what we have now and for our future. Something is missing in the equation. Now, if its cheaper to go with Penticton Bulk water, there should be no question that that is the way to go. But, with the controversy over even the useage of the community Centre Pool and suggestions of charging non-residents MORE, one has to wonder why Penticton should do WB any favors.
ps: option C, darke, was to build a Filtration plant; not leave the RDOS (though not a bad idea). Mr. Brydon feels that with the lake quality as it is now, that isnt necessary; however Interior Health may think otherwise in the very near future. Case in point - Vernon.

[Michael Brydon]

Does Penticton also aquire the water license the West Bench currently has in this deal? Water is a finite resource, if Penticton sells 7% of it's capacity to the West Bench then there is 7% less water available for future developments in Penticton. Developments that would actually contribute tax revenue to this city. While Penticton has excess capacity now, there is no telling how much water will be needed 10-20 years down the road as more people move to this area.

Good point. Selling water to the West Bench would definitely be a bad deal for Penticton if it the city needed the capacity for imminent future growth. The problem is that, according to Statistics Canada, Penticton is not growing very quickly. Moreover, condos use significantly less water than orchards (especially net of return flows). So if you think Penticton will need its surplus water treatment capacity to service the massive population growth you see around you, you should definitely be against sale of water to the West Bench.

Disclaimer: I am 44 years old. I attended Kindergarten-grade 7 at Carmi Elementary. The orchard on which I used to live is now Zellers.

As for water licenses: Water licenses in British Columbia are appurtenant. This is just a fancy way of saying that water licenses work the way you might think they should work: Water licenses are granted for beneficial use on specific property. So yes, the West Bench would have to transfer its water licenses to the City of Penticton in order for the city to be legally able to draw water on behalf of West Bench residents. If, at some point in the future, the West Bench decided that it wanted its water licenses back, the City of Penticton would have to relinquish them because it would no longer be supplying water to land on the West Bench.

Why hasn't Option "C" been presented to the residents of the West Bench? Leave the RDOS and join Penticton.

Area 'F' has the highest property assessments in the RDOS, making it an attractive takeover target for boundary expansion. However, the City of Penticton has not made a serious proposal for boundary expansion. One reason may be the roads issue. Roads and drainage in rural areas in BC are the responsibility of the provincial Ministry of Transportation and Infrastructure. If the City of Penticton expanded its boundaries to include the West Bench, it would also take over responsibility for the existing road network and its drainage problems (ask any West Bench resident about the sink holes). To this point, the City of Penticton has had no interest in this. What the West Bench thinks about boundary expansion is irrelevant until a proposal is forthcoming from the city. You should perhaps talk to your mayor and council about this.

[Michael Brydon]

I spoke to someone in Red Wing Resorts as I believe their water comes from the lake and is treated with chlorine and nothing else (I could stand to be corrected on that). The answer that I received was that Redwing is on First Nations lands and does not have to abide by the Interior Health guidelines. Yikes..thats a bit scarey for those residents; I sure wouldn't want to live there.

I agree that Duteau Creek is irrelevant: The West Bench draws it water from Okanagan Lake, not a creek. Red Wing Resorts and Sage Mesa (my water system) also draw their water directly from the lake and always have. In all three cases, the water is drawn from the lake, treated with chlorine, and pumped directly to peoples' tap--that's it: no filtration, no UV. In the case of the West Bench, this scary system has worked well for 60 years. In this same period, water from Penticton Creek has yielded hundreds of cases of so-called beaver fever.

Penticton and the West Bench (and Duteau Creek) have different source water quality. That is just the way it is. The West Bench has been mandated by IHA to add another level of treatment, hence this discussion topic.

[XT225]

I spoke to someone in Red Wing Resorts as I believe their water comes from the lake and is treated with chlorine and nothing else (I could stand to be corrected on that). The answer that I received was that Redwing is on First Nations lands and does not have to abide by the Interior Health guidelines. Yikes..thats a bit scarey for those residents; I sure wouldn't want to live there.

I agree that Duteau Creek is irrelevant: The West Bench draws it water from Okanagan Lake, not a creek. Red Wing Resorts and Sage Mesa (my water system) also draw their water directly from the lake and always have. In all three cases, the water is drawn from the lake, treated with chlorine, and pumped directly to peoples' tap--that's it: no filtration, no UV. In the case of the West Bench, this scary system has worked well for 60 years. In this same period, water from Penticton Creek has yielded hundreds of cases of so-called beaver fever.

Penticton and the West Bench (and Duteau Creek) have different source water quality. That is just the way it is. The West Bench has been mandated by IHA to add another level of treatment, hence this discussion topic.

Michael, please read my earlier questions and try your best to answer them.
Here is part of my post and also your quote:
I believe that WB turned its nose up (voted it down) against the deal that Penticton offered them a while back; and according to what Michael Brydon says: "West Bench residents are getting no "deal" in the larger sense. Even with the cheapest possible water treatment option (currently UV) the residential water rate paid by West Bench residents after the upgrade is going to be in the neighborhood of $2000/year".
If the cheapest route IS the UV plant, and he feels that further treatment is unnecessary, why is he even asking the question of Penticton? Build your plant, and let Penticton keep what we have now and for our future. Something is missing in the equation. Now, if its cheaper to go with Penticton Bulk water, there should be no question that that is the way to go. But, with the controversy over even the useage of the community Centre Pool and suggestions of charging non-residents MORE, one has to wonder why Penticton should do WB any favors.

Do you really feel that in the foreseable future, I.H. will not change the goalposts on things like turbidity standards? If you are certain, then why not build your UV plant and not bother trying to forge another deal with Penticton for bulk water. You said that UV was the cheapest route, so why would you even suggest going to bulk water and burden the WB populace with higher costs? I'm trying to read between the lines here and I have to wonder if you actually do believe that UV alone will soon not cut it. You need to be honest with yourself and the citizens of Westbench and think of the future generations. It also seems strange that you would bring this up just before election time and also put it on the election thread. It can't be tied to any Penticton council as far as I can see to either help or discredit them as its not an election issue. Once again, I will ask: Isn't your asking of Penticton to cut you a better rate for bulk water just like asking for a cheaper rate to use the Community Centre Pool? Remember, there is talk of charging MORE for non-residents to use it. I know....its unrelated but you can understand the comparison.

[twobits]

The long and short of it in my view is either pony up the actual cost of service or go ahead and build your own plant. I see no reason to to sell current excess capacity at a discount and lower our own future capacity. Speculation on future growth rates is an impossible exercise. There is also a possibility that our capacity could become a profit center much like our electrical utility. To lock in with WB at a discount for a 50 yr contract would not be a good business decision. I find it a bit disengenious for you to come on here and basically say, "Here's an offer for bulk water for 50 yrs at a discount. You have excess capacity so it's no skin off of your nose. Take it or we will just build our own cheaper UV plant"

As for option c or d or whatever about WB amalgamating. It is not just up to the city to approach. You could initiate a petition of residents and if in favour, you approach/petition the city. A study of the costs would be done and presented for consideration. Personally I think it is high time it was done. As you pointed out, tax assessments in WB are the highest in the rural RDOS area and that is due to contributions for things like the community centre and fire protection. It's time WB went for the full meal deal and not again treat our water supply as another a la carte Penticton service to cherry pick.....and this one at an expected discount too!!

OT- How are your brother and Cheryl doing? Are they still in Kamloops?