Population forecasts settle on 1 per cent growth for County

By Sharon Harrison
The long-awaited supplemental report on the implications of updated population growth forecasts as they affect infrastructure planning (i.e. water and waste water), was before council at Thursday’s committee of the whole meeting.

It was a long meeting that included an extensive and in-depth presentation (not made available to the public) by Cristal Laanstra, director of development services and Garrett Osborne, project manager.

The presentation brought intensive discussion around the horseshoe filled with questions, concerns and opinions directed to staff, with debate and opinion voiced on how much growth the County is expected to see – and opinions varied.

The conversation also extended to whether a regional water supply servicing strategy was the best way to go, or should Picton and Wellington have separate water and wastewater facilities, and what other options may be available, along with the cost of it all, and how it will all be financed.

In the end, council voted 11-1 in favour of adopting a County-wide growth rate of one per cent, a growth rate for future infrastructure planning as recommended by staff, and as per the 2025 growth analysis study on capital works infrastructure planning. The recorded vote saw councillor Roy Pennell opposed.

A number of councillors did not agree on the one per cent growth projection, but most could appreciate the financial sensibility for choosing it, including councillor John Hirsch who said, “I am one of those who think growth will exceed one per cent; by how much, I don’t know”.

“When I look at the demographics, when I look at what our development community is planning, when I look at what the professionals are telling us, that suggests much better than one per cent,” expressed Hirsch. “However, staff’s point about the risk of building out to 2.4 level is potentially an enormous risk because if building, and for whatever reason, the development doesn’t come that quickly, then we are in a financial problem.”

He said, he can buy the one per cent based on what staff have laid out with scenario 2B, “that if growth happens to show itself more quickly, we would be able to accelerate implementation of expansion of the water treatment plant, we could move up moving the pipeline to Picton if that growth is happening, as I, and the developers, think its going to happen”.

“Growth is happening,” he added, “the development community and the building community knows this place is going to attract customers so that is just a given. Any opinions that nothing is happening in terms of growth is just nonsense.”

Mayor Steve Ferguson said he too believes that one per cent is under the mark, but said it was good that opportunity exists to expand the system as growth demands under scenario 2B.

“The choices made today will help shape how Prince Edward County grows, invests and serves residents for decades to come,” said Laanstra, who added that there is “no risk-free path forward”. “The purpose of this work is not to identify a perfect option, but to ensure committee understands the trade-offs associated with each choice before determining the direction it wishes to pursue.”

The one per cent growth scenario continues to represent significant growth for the County, with the population projected to increase by approximately 9,330 residents over the next 25 years, from roughly 26,000 to 35,330 people, Laanstra outlined.

The majority of this growth is anticipated to occur within the urban centres of Picton and Wellington and equates to approximately 150 new residential units per year.

Staff describe the one per cent growth rate as “realistic”, while the other main option being considered of 2.4 per cent growth is described by them as “over optimistic”.

Council also agreed to have staff engage in negotiations with all parties proposing major development in Picton and Wellington for the potential of pre-payment agreements between the developers and the municipality that would contribute to the infrastructure costs required over the next 25 year infrastructure planning horizon.

Staff will also prepare a detailed financial strategy and hold public engagement for the one per cent growth rate scenario based on scenario 2B.

Scenario 2B brings development charges of $38,512 per unit, inclusive of $89.8 million growth related costs and $54.6 million additional financing costs. The water rate impact for ratepayers will be 7.6 per cent, and the wastewater rate impact 15.7 per cent.

Hirsch asked if the front-ending agreement negotiations with the developers are successful, what the impact on water and wastewater rates on ratepayers would be for next five years if scenario 2B is selected.

Laanstra explained that it will be a phased approach bringing on different elements of the infrastructure as the actual growth is realized.

“In theory, if that growth is coming closer to 2.4 per cent growth, we are in a similar scenario where we are able to capitalize on that economy of scale and have more of it paid for through development charges (DCs) and less impact on the user rates.”

Councillor Chris Braney took a difference stance on growth compared to some of his fellow councillors, stating how his fear, and his residents’ fear, is that “we are already in an insolvent state in Prince Edward County because of the mistakes of following this fairytale of 2.4”.

“The fear I have with the disaster that’s going on in Wellington, and with the overages with money with waste water and so on, I’m just trying to develop confidence. My fear is, I will predict that I fear that we will be in a declining growth rate, so what would happen if we would be in a declining growth rate?” asked Braney.

The staff report provides supplemental information to complete the overview of how updated population growth projections may affect long-term water and wastewater infrastructure planning.

“Recent growth studies indicate that evolving policy and economic conditions necessitated a decrease to previously established growth projections,” noted Laanstra, who explained how the County is currently evaluating two primary growth scenarios for long-term infrastructure planning.

The first is a high-growth scenario of 2.4 per cent annually, while the second is a more moderate growth scenario of one per cent annually, “which aligns with historical regional and provincial growth trends and is the recommended planning scenario identified by the County’s growth consultant, Watson & Associates Economists Ltd.”

Laanstra said the one per cent growth rate reflects a realistic and sustainable growth trajectory while reducing the financial risks associated with constructing infrastructure based on more aggressive growth assumptions that may not materialize.

“A lower growth rate also reduces the risk of overbuilding infrastructure and relying on DC revenues that may not be realized if growth occurs more slowly than anticipated.”

She noted that recent analysis suggests that previous growth assumptions of 2.4 per cent annually are likely “overly optimistic”, with updated forecasts recommending a one per cent annual growth rate.

“Maintaining the 2.4 per cent growth scenario would allow existing environmental assessments and design work to proceed without changes, but would require approximately $205 million in infrastructure investment between 2026 and 2030, creating significant financial and debt pressures and relying heavily on external funding and development charge recovery.”

The 2.4 per cent growth scenario projects population growth of approximately 23,000 residents over the same period, resulting in the total population nearly doubling to approximately 49,000 people.

She said under this growth scenario, two principal servicing strategies have been identified.

“The first involves construction of a regional water treatment plant (WTP) in Wellington to service both Picton and Wellington, while maintaining separate wastewater treatment facilities in each community,” explained Laanstra. “The second involves maintaining separate water and wastewater treatment facilities in both Picton and Wellington.”

“Based on the analysis completed to date, staff recommend proceeding with the regional water supply servicing strategy. While a regional approach remains the preferred option, the scale of infrastructure required under the one per cent growth scenario would be reduced compared to the infrastructure previously contemplated under the 2.4 per cent growth scenario.”

Infrastructure would generally be sized to accommodate the reduced projected growth over the next 25 years while maintaining the ability to be expanded to meet longer-term growth needs beyond the current planning horizon.

In order to accommodate the 25-year projected growth associated with the one per cent growth scenario, increased capacity is required at the water and wastewater plants in both Picton and Wellington.

CAO Adam Goheen clarified the one per cent growth rate that is being recommended that council adopt is an input to the project planning.

“I want to be clear, should council agree to adopt that growth rate, it does not confirm a particular project plan or a timeline therein, so we are not committing anybody today to a particular plan, plant or spending,” explained Goheen. “We have more work to do to determine how we are going to pay for all of this.”

The detailed staff report on the implications of updated population growth forecasts for infrastructure planning, along with a number of technical assessment and project timelines, as discussed at the June 25 committee of the whole meeting, can be found on the corresponding agenda item on the County’s website, along with the meeting recording.