One year after taking over management of its water and wastewater services, the Town of Okotoks has exceeded its projected cost savings and successes.
In May 2018, the Town reviewed a report, which indicated a potential savings of about $300,000 per year from taking utility services in-house rather than continuing to contract out to Epcor.
After the first 12 months, the Town expects to close out the year with about $375,000 in savings and saw more maintenance work completed by staff than in previous contracts.
“There’s not just the financial component of savings, but also I think because of the commitment, the level of effort from the staff is proved beneficial in this transition,” said Chris Radford, the Town's infrastructure and operations director.
While salary costs increased – including wages, benefits, training, certifications and memberships – contract costs decreased because the majority of staff and responsibility transferred over the to the Town from Epcor, he said.
More than 70 per cent of the costs associated with the Epcor contract had been staffing, and some of the support had been coming from Edmonton or Calgary, he said. Most staff transferred over and there were some new hires last year to fill in the gaps from those who did not.
Some increases were also seen in materials and supplies previously worked into the contract with Epcor, but overall the operational savings from taking water and wastewater services over resulted in investment to the utility and a transfer to tax support.
A new policy was developed, which saw 15 per cent of water and wastewater revenues cycled back to tax support, a total of $640,000 in 2020. Fee increases and town growth caused a revenue increase of $581,000, he said.
In addition to cost savings and revenue increases, he said there was more preventative and routine maintenance completed through 2020 than in years prior.
The Epcor contract stipulated 20 per cent of manholes would be inspected every year, but the Town’s team popped off and checked every manhole in Okotoks through 2020, he said. They also inspected every valve.
“We had a couple of teams that went out and every main valve in the system was actually turned, exercised, closed, opened, and we flushed the mains through the hydrants,” said Radford. “It’s important to understand the health of that system to make sure all of the valves are operating, anything unforeseen we can make the necessary adjustments for ongoing maintenance.”
Fire hydrants were all checked this year, as they have been in the past.
The Town is also embarking on a servicing program for pressure-reducing valves (PRV) that help to reduce water pressure in low-lying areas so pressure incoming doesn’t exceed limits. The plan is to ensure the PRVs are checked regularly to make sure they remain operable.
Sanitary flushing was conducted in 2020 and Radford said it’s one of the most important maintenance items to undertake.
“I think that’s one of the biggest liabilities in a collection system, is ensuring you have a regular inspection program and then being able to follow up for risk management and due diligence,” he said.
Part of gaining oversight of the utilities includes managing service requests, concerns and complaints from customers and responding to inquiries from the public, he said. The Town has implemented new software to help manage those calls.
He said capturing external service requests and customer service responses will allow the Town to adjust its service levels and proactively plan where its focus needs to be.
“We’ll be able to keep an eye on this and be able to adjust our services and proactively respond,” said Radford.
Town councillors were pleased with the results of the first year of service transfer, calling it a positive move for the community and the Town’s operations with cost savings and increases in the work completed.
“This was a risk and a gamble and there were certainly members of the community who were nervous about this,” said Coun. Florence Christophers. “So happy for this report and thank you for taking on this huge undertaking and having it go so well.”
