Toronto Environmental Alliance

Update: On November 29th, Toronto Council voted for the 2013 Water Budget to maintain a hidden discount worth $3.6 million to industrial water users to treat their wastewater pollution. In a close 18-22 vote, Councillor Mike Layton unfortunately lost his motion for full cost recovery which would have put a stop to industry's free ride. 

The 22 City Councillors that voted against Layton's motion will have to explain to their constituents why residential water rates are subsidizing large businesses that are unable to comply with the City's own Sewers By-law. Please refer to the image below to see how your Councillor voted:

Summary:

For an additional fee, Toronto Water treats water pollutants coming from 154 major industrial facilities whose wastewater discharge exceeds the limits set in Toronto's Sewers by-law. After an extensive review by Toronto Water and consultants, it became clear that this Industrial Waste Surcharge program is undercharging $3.6 Million per year. That means residential ratepayers are subsidizing the water pollution fees of big companies.

Staff have proposed a new formula that would recover the full cost of treating industrial wastewater from these customers. Unfortunately, some councillors at the Public Works Committee and Budget Committee rejected the staff proposal and  suggested another formula that would continue to provide a hidden discount to industrial water pollution every year. On November 29th, 2012, City Council voted in favour of maintaining this hidden discount. 

Businesses should be charged the real cost of treating every type of water pollution they send down the sewer system. Charging for only some of the costs means that companies will be rewarded for 'bad behaviour' rather than preventing pollution upstream.

TEA advocated against the proposal from the time it was introduced at Public Works and Infrastructure Committee all the way to it's approval at City Council on November 29th. Please read TEA's deputation and recommendations to Budget Committee as well as refer to our Technical Note for further details.

TEA's Recommendation to City Council:

Adopt the original Toronto Water recommendation for full cost recovery as proposed in the September 27th staff report which proposes
the Type 1 ODF Formula for calculating industrial waste surcharge fees.

Quick Facts:

• Toronto Water can achieve full cost recovery by charging businesses for each parameter they discharge into the sewers.
• Public Works and Infrastructure (PWI) Committee voted to continue with 'business as usual' by continuing to charge businesses for only one water pollution 'parameter'.

• While businesses will be charged for a single type of water pollution (based on the one they send down the sewer the most), they will not be charged for the other types of pollution that need treatment.
• If passed by City Council, the recommendations from Budget Committee will prevent Toronto Water from recovering the full $3.6 Million in costs and instead they will only recover $740,000.
• Polluters will be financially rewarded for actions that negatively impact the environment and residential rate payers will pay the price.

While TEA supports the existing financial subsidy for industrial water users that encourage water conservation and pollution prevention (known as the Block 2 Water Rate), we do not support the plan to continue providing hidden discounts to treat industry's wastewater pollution through the Industrial Waste Surcharge Program.

Businesses should be charged the real cost of treating every type of water pollution they send down the sewer system. If they are only charged for some of the costs, as proposed by Budget Committee on Nov. 12th 2012, Toronto Water will never be able to recover costs and will be forced to pay the difference from other water rate payers. In addition, companies will be rewarded for 'bad behaviour' rather than preventing pollution upstream.

Key Facts

• Cost of the program: $12.1 Million per year
• Revenue of the program: $8.5 Million per year
• Addition revenue required for cost recovery: $3.6 Million per year
• 154 industries pay for City services through industrial waste surcharge agreements
• 4 'parameters' are treated include Biological Oxygen Demand (BOD), Phenolics (4AAP), Total Suspended Solids (TSS), and Total Phosphorous (TP).
• Current cost to treat any parameter type: $0.57 per kg
• Real cost to treat parameter types ranges from $0.60 to $1.69 per kg

Read more:

• TEA's Briefing Note for councillors on industrial wastewater rates
• More details in TEA's Technical Note

City website:

• Staff briefing note on proposed industrial wastewater rate changes
• City Budget 2013 - Water and Waste rates budget page
• Toronto Water capital budget
• Toronto Water operating budget