Wheatland County adopts new framework for utility subsidies and 2027 rates

By Melissa Crispin-Piche Local Journalism Initiative Reporter

Wheatland County has adopted a new financial framework aimed at making utility subsidies more consistent and gradually shifting a larger share of service costs toward the residents who use those systems.

Council approved the Utility Services Financial Framework on Sept. 22 but amended the proposed subsidy ranges for smaller communities before directing administration to prepare 2027 utility rates.

The policy is intended to guide how the county calculates operating subsidies adjusts rates and plans for reserves and infrastructure replacement. It does not itself set individual utility bills; those rates will still have to be approved through the county’s Master Schedule of Fees Bylaw. 

Financial Services Manager Joel Chiasson said the policy grew out of an earlier Committee of the Whole discussion examining how much different communities’ utility systems are being subsidized.

“This policy would be a guide directive to inform administration on council’s preference in how to calculate the subsidy levels annually, how to amend the rates annually and reach certain targets,” Chiasson said.

Under the framework, subsidy targets are tied to the number of utility accounts in each community. The underlying idea is that very small systems have fewer customers over which to spread operating costs and may therefore require a larger subsidy.

Council amended the ranges before approving the policy.

For communities with zero to 100 utility accounts, the approved subsidy target range was changed to 40 to 50 per cent. Communities with 100 to 200 accounts were set at 20 to 40 per cent, while communities with more than 200 accounts remained at zero to 30 per cent.

The policy also generally uses a five-year rolling average when calculating subsidies to avoid having one unusual year cause a sharp change in rates.

Administration’s original 2027 projections called for total utility rate increases of 3.7 per cent in Carseland, 3.7 per cent in Speargrass, 3.2 per cent in Gleichen, 4.2 per cent in Rosebud, 2.1 per cent in Cluny and 4.2 per cent in Muirfield. Those figures combined subsidy adjustments with a 2.1-per-cent inflation component. 

Because council amended the subsidy ranges during the meeting, administration was directed to bring back the Master Schedule of Fees with 2027 rates reflecting the amended framework.

The discussion repeatedly returned to the question of how much general property-tax revenue should be used to support services available only to some county residents.

Reeve Scott Klassen said rural property owners who rely on private wells or septic systems do not receive the same municipal utility services. 

“We don’t supply this service to everybody,” Klassen said. “We have to balance that.”

Councillors also acknowledged that full cost recovery may not be practical in some small communities.

The policy allows smaller systems to remain subsidized within defined ranges rather than forcing immediate increases large enough to eliminate the subsidy. 

The agenda report said reaching zero subsidies in some service areas within five years would require substantial single-year rate increases. 

The framework also separates operating costs from long-term capital replacement. If a community performs better financially than its target subsidy range, the policy allows money to be directed into that community’s capital reserve rather than reducing rates. 

For commercial and industrial-only utility systems the policy takes a different approach: infrastructure and service costs are to be fully paid by the benefiting users without subsidy from general community resources. 

Council carried both the amended framework and the motion directing administration to return with the corresponding 2027 utility rates.