Nanaimo city council is jumping feet first into exploring how to meet water demands for a growing population.
A city staff report indicates the current water supply through the Jump Creek reservoir and South Fork Dam will be sufficient until about 2020, or when the local population reaches 100,000 people (it is currently estimated at about 90,000).
City hall is working on a solution now by issuing a request for qualifications for preliminary engineering work on a second dam referred to as South Fork 2, due to the magnitude and potential cost of the project, which is estimated to be in the $70 million range if the option is pursued.
Council already allocated $425,000 in the 2011 capital budget for the preliminary work.
"This type of project has a very long gestation period and this starts us on that road," said Al Kenning, city manager.
It is estimated the development of additional water storage is a 10- to 12-year project.
Coun. Bill Holdom said other options are being considered by council because of the high cost of a dam, including tapping into the Cassidy aquifer and other surface sources.
"We will be continuing to look at other options because I think [a dam] is the highest cost option," said Holdom. "But we have to start somewhere and I would just say the motion is simply to direct staff to issue a request for qualifications for preliminary engineering work. We're simply covering a base."
The discussion comes as the city is preparing to build a $65-million water treatment facility, $22.5 million of which would need to be borrowed or raised through an increase in user rates, as well as a multi-million dollar project for an emergency water supply that could see Harmac mill's water pumped to the city in an emergency situation.
Kenning said if a second dam is ultimately approved as the solution, funding would come from water user ratess, borrowing, grant applications and development cost charges.
"Development cost charges would be a big piece of this one because this is definitely a growth-related project," said Kenning, adding that DCCs currently include a levy to help pay for water infrastructure.
He added, however, that a previous council decided to encourage development by reducing the levy on developers for water infrastructure expansion.
"One of the decisions that council made which impacts the level of DCCs is that it decided to apply an assist factor to assist the development community ... council made a decision to lower the water DCC," said Kenning. "The development cost charges could be higher to help fund the water supply, but council was unwilling to raise them to a level that would be needed to pay for the full cost of the project."
Kenning said that in staff's view, expanding the water supply will be necessary to accommodate future demand.
The city's current water supply comes from the 230-square-kilometre South Nanaimo River watershed.
The existing South Fork Dam was built in 1930 and is kept full to ensure that supply pressure is maintained. Eight kilometers from that dam is the Jump Creek Dam, built in 1975, which stores water in the Jump Creek reservoir. Water is stored during the wet season then released to keep the South Fork Dam reservoir full.
Over the past few years, conservation efforts by the city, such as watering restrictions and toilet rebate programs, have helped keep per-capita consumption somewhat lower, but demand continues to grow.
A city report states that a study determined groundwater quantities were not sufficient to support the city's future needs.
Mayor John Ruttan said council will continue to explore options.
"I don't want to leave people with the assumption that South Fork Dam II is definitely going to be built and that $60 or $70 million may not at this time be something we are deciding on," said Ruttan. "There may be other ways of solving the problem without spending $70 million."
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