NIPIGON — Some significant work is scheduled to be done over the next two decades to a North Shore community’s water system.
A draft drinking water system financial plan was presented to Nipigon municipal council at its regular July meeting. Overall, it calls for about $10 million in capital spending on the township’s aging water infrastructure over the next 20 years.
“I don’t think people realize how expensive it is to run drinking water nowadays, because we have so many checks and balances to do — and rightly so. It is our drinking water,” mayor Suzanne Kukko said during the July 15 meeting. “It’s about a quarter of our whole budget (that) goes to water.”
Most of the water infrastructure was built prior to the 1970s “so, there’s a lot that has to be done in the next 20 years,” she said.
The report said the township’s water system’s assets include a water treatment plant, three reservoirs, chlorine contact tank, 15 kilometres of watermains, a pumphouse, 700 service connections, 67 fire hydrants, and numerous valves.
A 2024 assessment of the town’s water system assets, including things like hydrants, gate and curb stop valves, found about 60 per cent of them were in poor or very poor condition, “meaning they are reaching or have reached the end of their estimated useful life,” Taylor Haskell, Nipigon’s public works superintendent told Newswatch in an email.
“The water system is aging and requires a planned approach to capital infrastructure replacement,” the financial plan report said.
Operating revenues, such as water rates paid by residents and other charges, are projected to cover all operating costs (such as staff wages and benefits, materials and supplies, routine repairs, and valve replacements) and “a significant portion of the capital expenditures over the projected period,” according to the report.
Revenues are projected to increase by four per cent in each of 2026 and 2027 with annual three per cent increase starting in 2028 and continuing for the next four years. The fifth year will then see a five per cent hike. That five-year pattern is scheduled to repeat up to and including 2044.
However, Lars Moffatt, Nipigon’s chief administrative officer, municipal clerk and treasurer, said the plan is required to be updated every five years.
"Upon renewal, annual increases would then be reviewed to determine if the proposed rates are still sufficient," he said in an email.
The town is expected to take on about $2.6 million in debt over the next 20 years. Principal payments and interest costs on the debt are projected to increase over time, the report said, averaging $132,000 per year from 2029 to 2044. Most of that debt is expected to be taken on in 2029 and 2032.
Those two years also will see the most in projected capital spending, with a smaller spike in 2027. Moffatt said that the increases in 2029 and 2032 are related to the cost to replace various assets that total $698,000, and include “components reaching the end of their estimated useful life, such as the chemical feed panel, magmeter, chemical mixers, centrifugal pumps, process piping, fittings and valves, plastic tanks, and motorized valves.”
The 2027 increase is largely being driven by replacing components of the municipality’s high lift pumping station. Moffatt said that’s estimated to cost $176,000.
Much of the data in the draft drinking water system financial plan was taken from the township’s existing asset management plan, he said, with the forecasting allowing for an assessment of whether current rates are enough to cover operating and capital costs, or if adjustments are needed.
“This process is also valuable as it allows the township to coordinate future underground capital repairs with road infrastructure projects, minimizing the risk of repaving roads only to disrupt them a few years later for water or sewer system maintenance,” he said.