BCM awaits other side of water balance sheet

EXPANDING Buffalo City Metro’s boundaries last year to incorporate an additional 28 villages looks like it will cost around R30-million in the 2017-18 financial year – but only one side of the balance sheet is known.

More than 62 000 residents – of villages once in Great Kei, Ngqushwa and Amahlathi municipalities – now fall under BCM’s water supply responsibility and the asset transfer came into effect in July at the beginning of the financial year.

This comes after the Municipal Demarcation Board issued a redetermination of boundaries in 2015 which became effective following the local government elections that took place in 2016.

BCM’s head of infrastructure services, Nceba Ncunyana, said in a report tabled in council recently that the water assets being transferred had an estimated current replacement cost of R25.7-million. To ensure these assets continue to run efficiently, it would cost the city a further R2.5-million each year as well as an unknown amount in salaries. “This excludes the bulk water purchases. This will be handled by the facilitation committee in due process,” Ncunyana said, adding: “Bulk water purchases from Amatola Water and Amathole District Municipality are estimated around R1-million per year.”

“It was agreed between ADM and BCM that the administrative transfer of affected water schemes and assets take place on July 1 2017 to allow BCM to take over operations of the schemes and infrastructure so as to fulfil its legislative mandate with regards to water provision in the affected areas,” he added.

The administrative transfer

● The entire Kwelera borehole supply scheme, including ownership, operation and maintenance of includes: nine operational boreholes, reservoirs, pipe networks and standpipes;

● The Eskom connections supplying the Kwelera boreholes;

● Reservoir and pipeline infrastructure in the Rooikrantz area of the Kei Road Water supply scheme (the idea is that ADM will bill BCM for water supplied to this infrastructure from the Kei Road water treatment works, but a service level agreement setting out the tariff and conditions of supply is still to be finalised); and

● A reticulation infrastructure for 18 villages fed by the Sandile, Peddie and Rooikrantz water supply schemes. Amatola Water Board will bill BCM for the water supplied to these areas.

During the presentation of this report in council, DA councillor Geoff Walton demanded to know what the liabilities attached to these assets were as well as the current condition of the assets.

“All of these issues need to be incorporated into our asset register so I agree that council should note this report but it [council] should request a further report in the January council meeting.”

Council noted the report but Ncunyana is to table a more detailed, report next month. —