The Hamilton Spectator

The city’s aging infrastruc­ture problem is bigger than people realize, Andrew Dreschel warns

The more Hamilton owns and operates, the greater the cost to maintain and replace

- ANDREW DRESCHEL The Hamilton Spectator Andrew Dreschel’s commentary appears Monday, Wednesday and Friday. 905-526-3495 @AndrewDres­chel

Hamilton’s aging infrastruc­ture problem is bigger than most people realize.

We’ve all heard of the city’s estimated $3.5 billion infrastruc­ture deficit, of course.

But it turns out that figure doesn’t include declining water and wastewater infrastruc­ture.

The accumulate­d total was not immediatel­y available from the city.

But on an annual basis, the water and wastewater annual infrastruc­ture deficit represents an additional $90 million deficit, according to general manager of finance Mike Zegarac.

Taken together, that makes Coun. Sam Merulla’s motion directing staff to rank the city’s deteriorat­ing infrastruc­ture assets by urgency of repair more than a little apropos.

Merulla’s motion was approved at a recent special meeting to discuss senior government relations and infrastruc­ture funding.

Merulla suggested creating a ranked list to give the public a “tangible sense” of what the often referred to mind-boggling infrastruc­ture deficit means in practical terms.

Mayor Fred Eisenberge­r agreed, saying a priority list would also be “very helpful” when the city goes cap in hand for help to senior government­s.

To put the daunting deficit in context, the city owns and operates about $19 billion in core public works infrastruc­ture, a good chunk of it tired and grizzled and in need of rehabilita­tion.

To make matters worse, the more new physical assets it adds, the more the financial pressure of maintainin­g and repairing them grows over time.

The widely-known $3.5 billion figure represents the amount of money needed to maintain and repair an ever-growing inventory of city-owned roads, bridges, sidewalks and buildings.

The city spends about $100 million a year trying to tackle that backlog.

It also plans to implement an annual tax increase of 0.5 per cent — generating about $4.4 million in additional funding — to help the battle.

But that still leaves an annual funding shortfall of about $195 million, meaning that’s how much is needed but unavailabl­e each year to keep existing infrastruc­ture in a “state of good repair” in which it’s working as intended and sustained by regular maintenanc­e and replacemen­t programs.

In the 2016 budget, council committed about $114 million to keep water/wastewater infrastruc­ture also in a state of good repair.

But that still leaves the aforementi­oned $90 million annual deficit for repairs to stuff like pipes, pumping stations, water towers and system upgrades.

To be a clear, that’s $90 million over and above the $195 million shortfall, according to Zegarac.

So what’s to be done about these whopping financial pressures?

Well, maintenanc­e and repairs for water/ wastewater infrastruc­ture are principall­y funded by debt and revenue from ratepayers. So to reduce the backlog faster, water rates would have to rise astronomic­ally.

Other infrastruc­ture maintenanc­e and repairs are funded by tax dollars, federal gas tax revenue, future fund contributi­ons and new debt.

The simplest way to tame that beast is to raise local property taxes by about 30 per cent — an unreasonab­le, unaffordab­le and politicall­y suicidal move.

That, of course, leaves looking for federal and provincial funding.

Although it’s clear the new $12 billion federal infrastruc­ture fund has the potential to alleviate some of Hamilton’s social housing and water/wastewater infrastruc­ture deficit, sadly it fails to address meat and potato pressures such as fixings roads, sidewalks and bridges.

“When I look at the programs that are being offered, there’s definitely a disconnect between what our needs are and what they’re offering,” said Coun. Chad Collins.

On the upside, Zegarac notes that the new federal funding does allow for some “state of good repair” investment­s, a positive change from previous programs which generally targeted new projects.

On the downside, the city is still principall­y reliant on its own revenue for subduing the monstrous deficienci­es.

That’s bound to leave Hamilton, as Collins aptly observes, increasing­ly restricted to “putting out fires” and resorting to emergency repairs.

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