1. Best, Lowest Cost Solution:
Associated Engineering was chosen in 2007 to conduct an options review to determine the most cost effective way to meet health requirements for potable water supply for SEKID. The terms of reference indicated any and all options should be studied, including interconnection opportunities with neighboring utilities. Associated Engineering sub-contracted Golder Associates to assess the well field capacity and sustainability of the groundwater supply.
Option 6 of the summary report proposed a groundwater domestic supply and full depth separated distribution for the rural service area. This was the recommended option presented in the report and the SEKID Board of Trustees adopted this as the preferred option. A number of factors were considered in choosing Option 6 including cost, water quality/health requirements and sustainability of supply. This will now be referred to as the WQIP (Water Quality Improvement Program).
A link to the summary report is provided below, along with a link to the Golder Associates well field capacity report (Three supporting technical memoranda to the Summary Report can be found on the SEKID web site on the following page: News & Reports/Internal Reports/page:2. Scroll down to Water Supply and Treatment: Summary Report Nov. 2007):
Associated Engineering. November, 2007. Summary Report South East Kelowna Irrigation District Water Supply and Treatment Cost/Benefit Review.
Golder Associates. November 2007. Hydrogeological Evaluation Well Field Capacity South East Kelowna Irrigation District.
CTQ Consultants were selected in 2012 to do the pre-design study for the project, including groundwater source development and domestic distribution system. Western Water Associates was contracted by CTQ to review and confirm well field capacity at that time.
CTQ Consultants, May, 2012. Pre-Design Report Domestic Supply System - South East Kelowna Irrigation District.
CTQ Consultants, May, 2012. Pre-Design Report - Drawings.
Western Water Associates, May, 2011. SEKID Pre-Design – Preliminary Hydrogeological Findings.
SEKID's groundwater supply has been approved as a potable water supply since 1981. A comprehensive water quality analysis from CARO Analytical is available below. The groundwater analysis begins mid-way down page four under Sample ID: Johnson Road.
Ongoing monitoring of water quality parameters in the existing groundwater supply, however, raised concerns about nitrate levels in late 2010. SEKID subsequently commissioned a study of the risk of elevated nitrate levels in the aquifer. The purpose of the study was to provide a temporal and spatial analysis of available data, some form of characterization of the nitrate as being organic or inorganic and an overview regarding the vulnerability of the aquifer and likelihood that nitrate levels could eventually exceed the Guidelines for Canadian Drinking Water Quality [GCDWQ]. The study, by Sustainable Subsurface Solutions, concluded the nitrate levels would stay within acceptable levels for at least the next fifty years.
Also included in this submission is a report by Associated Environmental Consultants providing the results of a groundwater sampling program for viruses, protozoa and chemical waste indicators in SEKID's groundwater supply. This is the same aquifer that will be used for the WQIP. No viruses or protozoa were found in any of the samples taken.
Not included in SEKID’s submission, but worth noting, is the Kelowna Groundwater Protection Program developed by the Kelowna Joint Water Committee (KJWC) between 2004 and 2009. This comprehensive study identifies the capture zones for all major public utility wells in Kelowna (including future SEKID well field development areas). The KJWC worked alongside city planners to include groundwater as a natural feature in the City of Kelowna Official Community Plan in 2010. A development permit is now required for development within these capture zones. This greatly improves groundwater protection within the city. Thanks to the pioneering work of the KJWC, Kelowna was the first municipality in British Columbia to integrate a groundwater protection program within an Official Community Plan.
CARO Analytical. August, 2016. Comprehensive Analysis.
Sustainable Subsurface Solutions, February, 2011. Preliminary Characterization of Nitrates in Groundwater in Wells Completed in the Mission Creek Fan Aquifer Southeast Kelowna, BC.
Associated Environmental. April, 2016. Spring 2015 Pathogen Sampling Results Osoyoos and Penticton Indian Band and SEKID Drinking Water Supply Wells.
In 2012 SEKID developed a financial plan to implement the WQIP without senior government grant assistance. The district was under pressure from Interior Health to move forward with the project as soon as possible. The plan relied on borrowing $15m and implementing the project over a ten year period (three implementation strategies/periods were considered and the ten year plan was the most cost-effective, resulting in $4m in financing cost savings). Phase 1 (source development and high density area servicing) of the WQIP would be completed in two years and service about two thirds of the population while Phase 2 (rural domestic distribution system) would be completed over the remaining eight year period.
SEKID is required by the province to obtain ratepayer approval to borrow funds and an extensive public communication plan was implemented. The consultation included a newsletter, press releases, dedicated web page and three well attended public meetings held at three separate venues throughout the district.
The borrowing plan was soundly rejected by the ratepayers through the Alternative Approval Process (33% of eligible voters opposed). Over 95% of those surveyed during the public meetings agreed with the project proposal but did not feel the project should move forward without funding assistance from the provincial and federal governments.
Without ratepayer approval the Board of Trustees were unable to pass a borrowing bylaw. Interior Health was consulted regarding the option of issuing the district an order to proceed but declined to do so (a statutory order would have compelled the province to register the district’s borrowing bylaw, enabling the project to proceed without ratepayer approval).
SEKID subsequently revised the financial plan to fund the project through a combination of asset liquidation (land) and rate increases.
The original studies for the WQIP were completed in 2012. The costs, financial plan, with and without grant funding, and sustainability of the groundwater supply have been reconsidered and updated using current information.
Agua Consulting was commissioned to review the original Pre-Design Report by CTQ Consultants and provide an update of project costs:
Agua Consulting, September, 2016. Domestic Groundwater Supply Project - project review and cost update.
SEKID’s revenue requirements for the updated cost estimate were reviewed by Econics (rate specialists) to insure revenues were sufficient to sustain the full cost of the organization, including operating, capital and asset renewal expenses. The following summary assumes the full cost of improvements without the benefit of grant funding:
Econics, October, 2016. Scenario_B5-5_Oct2016. This rate requirement review was based on implementing the program through two phases with a levy being placed on the Phase 1 residents in July of 2015. The Phase 2 residents would not begin to pay a levy until Phase 1 was complete and only when improved water was available to the customer. While not presented here, the data sets and assumptions used to generate this analysis are available on request.
As it became increasingly apparent the project might be eligible for 83% grant funding, the option to consider affordable project improvements became apparent. The original project had no supply redundancy contingencies included due to the added rate burden these costs would present: the district simply could not afford supply contingency options. With the prospect of grant funding becoming available, these restrictions no longer apply and Agua Consulting was asked to provide an analysis of what interconnections with neighboring utilities would be viable and at what cost. These interconnections would provide two-way flexibility allowing supply to be brought in and out of the service area, increasing redundancy in this portion of the city by providing an alternative to lake water sources.
Consideration was also given to expanding the service area to include the unserviced Hall and Parsons Road areas, in addition to estimated development and infill growth within the current service area. The review also supplies an analysis of annual pumping cost for the WQIP and the Associated Engineering November, 2016 Report – SEKID Supply Options:
Agua Consulting, December, 2016. SEKID – Water Supply Options Update.
Econics, December, 2016. Scenario B5-5 (w grant + ACFAR). SEKID’s revenue requirements for the updated cost estimate, with 83% grant funding, were then reviewed by Econics to analyze the impacts of increasing the underfunded asset renewal requirements of the district. The original rate strategy without grant funding was to rely on renewal reserves to sustain asset requirements while financing the capital cost of the WQIP revenues through reserve funds and rate increases. Once the WQIP costs were paid, revenues would be contributed to the asset renewal reserves to cover any underfunded liability. With 83% WQIP grant funding SEKID would be able to charge an average unit rate of $50/month (all services will be metered) and make annual contributions to asset renewal of about $275 k per year to the year 2021 and about $750 k per year thereafter. This represents an annual contribution of approximately 1% of asset replacement value.
As the hydrogeological reports presented above indicate, sustainability of the groundwater supply is an important consideration that has been studied in detail since the initial decision was made to follow the Associated Engineering groundwater supply recommendation in 2007.
All water sources have some degree of risk for both supply and quality. The sustainability of the aquifer has recently come into question because of declining water levels in local observation wells and a recent UBCO master’s thesis that brings into question the long term sustainability of the aquifer.
With new data available from a number of sources, Piteau and Associates was commissioned to review this information and provide a critical assessment and update on the groundwater supply. A link to the UBCO master’s thesis is also provided:
Nicole Pyett, September, 2015. Physical measurements of groundwater contributions to a large lake.
Piteau Associates, December 2016. Technical Memorandum - Update on Groundwater Recharge and Interaction with Surface Water in the Kelowna Area.