Three billion people lack safe sanitation services around the world and more than one billion people have no access to safe water that means they had to revert to unprotected wells or springs, canals, lakes or rivers to get water. The situation regarding drinking water in developing countries is getting worse by the minute mostly because of pollution, irrigation, lack of money, wars and progressive climate change. The World Health Organization has defined around 20 litres of water per capita per day as the minimum amount – although this amount still implies high health concerns – and 100 litres per capita per day as the optimal access, associated with low health concerns. Nevertheless, small country like Canada with the population of only 33 million discharges more than 3 trillion litres (Estimated to be 249 litres per person per day) of treated effluent with contaminants each year into Canada’s surface water such as lakes, rivers, streams, and oceans that has a wide range of potential impacts to environment and human health.

As per a report produced by the Canadian Council of Ministers of the Environment municipal wastewater effluent consists of sanitary waste, collected in sewers and from Canadian households. It also was includes waste from industry, commercial establishments, and institutions. In some cases, urban runoff or stormwater collected in the same collections system as sanitary waste, adding different ingredients to municipal wastewater entering wastewater facilities. Municipalities and wastewater facility owners are able to reduce some contaminant levels through treatment of the effluent. Municipal wastewater effluent is commonly comprised of:

• Grit, debris, and suspended solids;
  
• Disease causing pathogens such as viruses and bacteria;
  
• Decaying organic waste which reduces the amount of available oxygen in a water body; and
  
• Nutrients such as nitrogen and phosphorus.
  

   

In addition to typical contaminants, newly emerging contaminants such as pharmaceuticals, personal care products, endocrine disrupting compounds, and brominated flame retardants are a growing cause for concern.

Statistically speaking, the percentage of the population served by public sewage treatment in Canada is 78 percent, placing Canada 9^th. Out of 28 the Organization for Economic Co-operation and Development (OECD) countries behind the Netherlands, Switzerland, Sweden, Germany, Luxembourg, Denmark, the United Kingdom and New Zealand. Another 12 percent of Canadians are connected to public sewage networks but are not served by any form of sewage treatment. In other words, their sewage enters a pipe, but no efforts made to treat it before returning it to the environment. A further 9 percent of Canadians not served by public sewage treatment, but may have private treatment services, such as septic tanks.

There are three levels of sewage treatments – primary, secondary and tertiary. Tertiary treatment provides progressively more effective treatment. In Canada, only 33 percent of the population served by tertiary treatment, the best available treatment, while 19 percent still have access to only crude primary treatment, the least effective form of sewage treatment. In contrast, in countries like Germany, Denmark, Finland, Sweden and Switzerland, over 70% of the population served by tertiary treatment.

There is always a possibility that the situation may have been changed since the publication of the OECD report that indicated that over 90 Canadian municipalities still discharge raw, untreated sewage, including three provincial capitals, Victoria, Halifax, and St. John’s., 14 Raw sewage from these three large cities still goes straight into the ocean.

Here is what the Government of Canada is attempting to do in order to rectify the Canadian situation related to municipal wastewater effluent.

Jim Prentice, Canadian Minster of Environment, announced in February 2010 that a draft of proposed municipal wastewater systems effluent is now available for public consultation. The proposed Regulations developed under the Fisheries Act. Here are some selected highlights:

• Once in force, these Regulations will set standards for the discharge from all wastewater facilities in Canada.  Over time, wastewater facilities across the country will have to meet these national standards and it will no longer be permitted to directly release raw sewage into Canadian waterways;
  
• The proposed Regulations would come into force through a phased approach. Effluent monitoring requirements, record-keeping and reporting requirements, and the provisions allowing temporary or transitional authorizations to be applied for and issued would come into force on the day on which the proposed Regulations are registered. The requirement to meet the effluent quality standards would come into force 24 months following the registration of the proposed Regulations, with the exception of the standard for total residual chlorine, which would come fully into force over three years;
  
• The purpose of the proposed municipal wastewater is to provide national performance standards and give regulatory clarity on standards and rules on reporting for more than 4,000 Canadian wastewater facilities across Canada. The Government of Canada has identified wastewater infrastructure as a priority for its infrastructure programs and it will negotiate agreements with the provincial governments, and the Yukon government. The agreements will cover the roles and responsibilities for reporting, compliance, inspection, and enforcement activities;
  
• The Government of Canada has supported wastewater projects under the Green Infrastructure Fund and Building Canada Fund. Canada’s Economic Action Plan accelerated and expanded the existing $33-billion federal investment in infrastructure with almost $12 billion in new infrastructure stimulus funding across Canada over two years; and
  
• The Building Canada Plan supports infrastructure activities through resources from the Gas Tax Fund, which the government agreed to extend beyond 2014, and is estimated to generate $2 billion per year. The Gas Tax Fund supports environmentally sustainable municipal infrastructure projects that contribute to cleaner air, cleaner water and reduced greenhouse gas emissions.
  

As a quick background, currently, provincial and territorial governments are responsible for the regulation of wastewater treatment operations. Most have waste control statues that apply directly to the discharge of municipal wastewater effluent. Operators of wastewater systems that specify wastewater facility maintenance and treatment requirements and discharge substances found in municipal wastewater require approved permits. As far as the Federal Government is concerned, currently, there is no federal legislation directly pertaining to the discharge of municipal wastewater effluent. However, the Federal Government does enforce the Fisheries Act that protects Canadian waters against the deposit of deleterious substances into fish habitat and the Canadian Environmental Protection Act (1999) which governs the release of toxic substances into the environment and enables to control or eliminate use of these substances.

Here is a reality check – The question is who is going to be responsible for the cost associated with the implementation of the proposed Regulations?

The majority of the costs of the proposed Regulations would be borne by municipalities, as they own and operate the vast majority of wastewater systems in Canada. These include capital and operating costs for systems that need upgrading to meet the required standards. Non-capital costs would also be incurred, including monitoring and reporting costs, and in some cases environmental monitoring costs. Combined, all of the costs total $5.9 billion in present value terms.

Here is the bottomline – Where the money will be coming from?

The document signifies the impact of the costs on businesses and consumers in the respective municipalities. The anticipation is that businesses as well as the consumers may face higher taxes or utility rates to help pay for the costs associated with the required capital upgrades in a number of communities. There is insufficient information available to the federal government to predict the potential magnitude of such increases. However, as public infrastructure is funded through a variety of sources, impacts on businesses and consumers in particular communities are expected to be relatively small. Governments have also agreed to explore alternatives for very small communities to address the proposed regulatory requirements in an efficient manner.

It would be an understatement to say that the majority of the municipalities across Canada are faced with fiscal challenges and struggling for their survival. Believe it or not, only 6 to 8 percent of the total taxes collected in the municipalities depending upon the size of the municipality, go to the municipalities. Remaining amounts of collected taxes in the municipalities are distributed generously between the federal and provincial governments. According to the Federation of Canadian Municipalities (Early Warning: Will Canadian cities compete?), in the five-year period beginning in 1995, total revenues to local governments in Canada increased only 6 percent. During the same period, revenues to the federal government increased by 21 percent and to provincial governments by 13 percent. With urban population growth rising by about 6 percent over this period, Canada’s municipal governments were barely keeping pace.

Municipalities across Canada seem to be developing reputation for overspending. According to an article, property taxes are spiralling out of control in BC simply because municipal governments refuse to rein in spending. For instance, between 2002 and 2008, BC municipal spending rose by almost 50 percent and the property tax rose by 36 percent, all at a time when inflation rose by 8.5 percent. In 2008, BC municipalities paid almost $400 million interest on their debt.

Furthermore, currently municipalities across Canada are going through a painful process of setting targets for the reduction of greenhouse gas emissions in their jurisdictions to deal with the voluntary or otherwise Climate Change Regulations that indeed is not a popular exercise. Some municipalities are totally obsess with the idea of making their municipalities greener and setting very aggressive and unrealistic targets at the risk of upsetting developers and builders which is becoming a cause for concern. This is not going to help create a friendly atmosphere for implementing the future regulations that may require tax increases.

With reference to increasing taxes to justify the implementation of the proposed Regulations, Canadian taxpayers are totally fed-up with the increasing taxes at all three levels of governments. The word “tax” itself has a dramatic psychological impact on them. Both Ontario and B.C. will see the new Harmonized Sales Tax (HST) increase consumption taxes by 8 per cent and 7 per cent respectively on items previously untaxed. Quebec has seen a new health tax and a 2 per cent increase in its sales tax over two years. Nova Scotia announced a 2 per cent increase in its sales tax. Residents of B.C. also have continually rising health and carbon taxes.

Everybody is aware of the fact that municipal property tax rates are climbing well beyond the rate of inflation and have been for years. As well, the federal government will increase EI premiums next January while continuing to fund lavish training programs with the cash. These tax hikes explain why Canadians feel they work harder and harder yet keep falling further and further behind.  

Municipalities are totally convinced about the benefits associated with the proposed Regulations including healthier fish and aquatic ecosystems; increased recreational use; higher property values; reduced health risks from recreational contact with and consumption of fish; reduced water supply costs for municipalities and industry; and increased commercial fisheries use. However, the reality is that the majority of the municipalities have no money and they are not prepared to take the risk of increasing taxes to justify the implementation of the proposed Regulations. Under these circumstances, perhaps the only solution for those municipalities who are suffering from fiscal difficulties is to start thinking waste as a resource and find companies that are interested in help implementing project like municipal wastewater effluent by utilizing the concept of P3 (Public-Private Partnership) and creating municipal utilities.

There are companies out there who are well equipped to help municipalities of all sizes with a typical fee-based business model, the municipalities do not pay the construction or capital costs of the recycling facilities, or the ongoing operation costs, plus the company’s profit margin, from a negotiated fee paid by the municipality over a negotiated period of time. What all municipalities have to do is to find a compatible company to be partners with and with the objective to create a win-win situation by implementing the proposed Regulations without increasing any taxes to their residents and at the same time creating opportunities to make money out of a municipal utility on a long range basis.

Perhaps the creative thinking and innovative solutions will continue to empower municipalities to seek solutions in the interest of their residents without increasing taxes but there is a need for the federal as well as provincial governments to keep it in mind the following statement (that made by the OECD) before proposing any new regulations and not providing adequate funding:

• “There is a growing gap between the services Canada’s municipalities must deliver and what they can afford. These services are essential, yet the resources do not match the need. Compared with other orders of government, Canadian municipal governments have far fewer tools with which to raise revenue. The fiscal toolkit available to municipal governments in the United States and other OECD countries is much more diverse, generous and flexible than that available to Canadian municipalities.”
  

mirali@aimamc.com