Following in Calgary's Footsteps

Most of us have heard of Calgary's on going watermain breaks and the hardship that Calgarians are living with as a result. Seeing the pictures and hearing the news made me cringe when I think of our own towns vulnerability given the age of our drinking water infrastructure.

The town has approximately 28.5 kilometers of asbestos cement (AC) water pipe. According to a October 2025 staff report most of the AC waterpipe needs to be replaced between now and 2040 (0 to 14 years). The cost to replace is somewhere between $1600 and $2650 per meter so the total cost to replace the AC part of the water infrastructure is approximately $48 million based on todays costs. The town's water infrastructure also includes another 79.5 kilometers of additional watermains, 9 ground water wells, 5 reservoirs and 5 booster stations, 4000 water meters and 451 Hydrants. Repair and replacement of these additional assets is not included in the $48 million quoted above.

What we are told

During the January 14th Committee of the Whole (COTW) public engagement session the town's Director of Finance provided 71 power point slides to address the Capital Budget portion of the towns proposed 2026-2030 financial plan. (A link is provided below)

Slide 11 Confirms the projected opening balance of the Water Infrastructure Reserve Fund as $1,662,000.

Slide 16 Confirms the current rate of annual funding into the reserve is $1.3 million and that this amount needs to be increased to $2.1 million in order to maintain the town's goal of an 88% Asset Health Score which we are told is "very good".

Slide 29 Lists the components of the water system (detailed above). The Director of Finance confirmed a Water Master plan [budgeted in 2025 at $80K] will be undertaken in 2026 to enhance condition data and better inform long term replacement planning information. Priority is AC replacement over the next 25 years due to available funding constraints.

Slide 30 is a bar graph that depicts planned spending over the next five years and shows components of that spending as deferred. In his narrative we were told that the towns goal in this 5 year budget is 1000 meters per year. [At this rate the towns goal would cost 1000 x$1600=$1.6 million per year just for AC replacement. It would take 28.5 years to complete the full replacement notwithstanding that we've been told these pipes should be replaced within 14 years.]

Slide 51 Water Fund Asset Replacement shows the 2026 to 2030 breakdown by project. In his narrative the Director confirms that the plan is to replace 4000 meters at a total cost of $7.8 million in the five year period. Of the $7.8 million budgeted in the five year period $6.7 million will be funded from the Water Reserve Fund and $1.113,000 will be funded from Eaglecrest land sales in 2028. [I note that in this first 5 year period we are only replacing 4000 meters versus the towns goal of 5000 meters.}

Slide 68 Headed as "Servicing Costs Phase1 Eaglecrest" is a budget provision placeholder to cover $625,000 installing municipal services in Phase 1 Parcels in Eaglecrest. Funded from anticipated sale proceeds from Phase 1 parcels. Subject to change based on final design. This slide was narrated by the Director of Planning who indicated "this is a placeholder in the budget for now as there is some subdivision activity underway to make these properties available for sale". [This municipal services project was not listed in the Water Fund nor the Sewer Fund and with a private developer this would likely have been paid by the developer as DCC's. Water and Sewer DCCs do not come free as the town has to provide the services/pipes at the towns cost]

Conclusion

Health Score of 88% viewed to be "very good" is not a good indicator of the actual health of our ability to replace our assets as they mature and need replacing. The financial model has significant limitations that I think are giving our council and others a false sense of comfort. Many municipalities choose not use this form of modeling to address their asset management programs. As clearly evidenced in the Water Fund analysis using long term financial modeling is not giving the town an accurate picture of the amount we need to contribute on an annual basis into our reserves to fund replacement. If I take the $48 million needed to replace just the AC pipes and divided it by 14 years by which time they need to be replaced, I come out to $3.5 million a year just to replace the AC pipes.

It is not rocket science. Deferral beyond expected life is bound to leave us in the same situation as Calgary. The next challenge for town staff is to explore other methods of taxation to make the system fairer. Currently we tax on a "parcel" basis which I think means that property that has one title pays one parcel tax currently set at $280 for 2026. This does not take into consideration how many households live on that one parcel. With increasing density and garden suites we will have many more parcels supporting 2 to 4 families paying only one fee to the town. I do not know how rental apartments contribute...one parcel one $280 fee? or 30 suites so 30x$280 fees? The town may wish to also review the pricing structure for water being sold to the RDN to ensure that we are being adequately compensated for our infrastructure costs.

Further taxation "fairness" might be achieved by considering long term debt financing as a better match of payments over the expected useful life of the asset. We could also divest land and or other assets. We can stop spending in other areas and redirect the funds.

What I do know is that deferral beyond expected life for critical water infrastructure is not an appropriate option and will only lead to chaos. Just ask any Calgarian!

Marie Noel

January 16 2026

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More Info/Links

Slide deck from Jan 14 2026 COTW meeting

You tube video of the COTW meeting

Calgary news story