Is a Tax Revenue Bonanza Coming to Thunder Bay?

 

Things have been relatively quiet of late at Thunder Bay City Council all things considered.  Indeed, for the most part, this will be a relatively subdued year barring any unfortunate issues rearing their head because we are moving into the final year before an election next fall.  Among the items that have emerged over the past few weeks include a new community well-being plan, piloting work from home projects, recognizing the National Day for Truth and Reconciliation, awareness campaigns for incident reporting in anti-racism matters, and vaccine policies for city workers.  

 

In terms of direct services and expenditures, Thunder Bay is moving forward with the curbside collection for organics by initiating the process for studying the matter – that should take the better part of a year – and is also going to spend an additional $1.5 million for the Boulevard Lake Dam.  And as a bonus, there was the debate over whether residents be allowed to continue using plastic bags for garbage pick-up or garbage bins made mandatory.  None of these have been exceptionally attention getting but then it is summer and Thunder Bay's camp culture means a lot of people have gone to the countryside and are not paying much attention.

 

What issues have been rather quiet?  Well, after a discussion about the multi-use turf facility being back on the agenda in June to solicit private sector proposals little has been said since.  After a vote to move forward with a plebiscite to reduce its size and forwarding the matter to administration for a report, again little more in terms of what has been done since.  There is also the matter of the budget – one expects some type of report soon on the budgetary position and the size of a likely surplus as we approach year end.  And of course, there is the matter of the ongoing leaky pipe scenario which is still seeing homes dig up their front lawns as corroded service pipes are replaced in the wake of the addition of sodium hydroxide – not to mention interior pipes leaking and the resulting damage.  Which brings me to the main event.

 

The damage that is being done in literally thousands of homes across the city by leaky pipes is resulting in repairs and often substantial renovations.  Another unintended fringe benefit to all this – aside from water connection fee revenue to the city and a lot of employment for trades people and landscapers – is the potential of a rising property tax base in the wake of the property renovations.  Even if property tax rate stays the same, the expanding base due to higher valuations on residential properties reflecting enhanced value due to renovations may be a factor in increasing the City of Thunder Bay’s property tax revenues. With increases in the tax rate, revenue increases could be greater.  Far-fetched? Maybe and then maybe not.

 

The Municipal Property Assessment Corporation (MPAC) establishes the value of properties for taxation purposes using a method known as current value assessment.  The most used valuation method for residential properties is what is known as direct comparison which analyzes the recent sales of comparable properties.  However, it is not just the sale price that is used in the multiple regression models assigning a residential property but up to 200 factors using data from land title documents, building permits, on-site inspection and communications with property owners and reviews of sales transactions.  In the structural features segment of the variable sets there is included the renovation and year of renovation.

 

The five major factors as reflected by ultimate weighting of results are the age of the buildings, the square footage of the living area, the location (reflected by recent sales in your area), lot size and construction quality.   However, renovations do enter into the formula, and it remains to be seen if the increase in renovations as reflected by building permits issued to properties to conduct their renovations and repairs and any onsite inspections will ultimately also be a factor in increasing the total value of the assessment in Thunder Bay.

 

Homeowners in Thunder Bay affected by the leaky pipes fiasco have had to contend with disruption and repairs to their property, the inconvenience of having their water supply interrupted for a period, the stress of worrying about future leaky pipes, the cost of repairs if insurance coverage is inadequate, and future increase in home insurance costs as insurance companies re-calibrate their rates to deal with the higher risk of insuring properties in Thunder Bay.  Now to all this is the prospect that if future budgets begin to raise rates at historic levels of 3-4 percent, some of the increase in taxes will inevitably reflect the effect of the leaky pipe repairs on property values. And of course for the average homeowner, it will be difficult to separate any effect of leaky pipe renovations on assessed values from the increase in home prices that has occurred over the last year.

 

True, City Council has directed administration to restrain increases to 2.25 percent for 2022 and that will probably happen given the election coming in Fall 2022.  However, once a four year mandate has been granted after next fall, be prepared for much higher rate increases with the increase in assessments a potential additional factor.

 

 

Economic Development Action in Thunder Bay: City Council’s Keynesian Economic Action Plan

 

As Thunder Bay’s leaky pipe saga continues with lawn after lawn being dug up to replace service lines likely corroded by the addition of sodium hydroxide as a lead mitigation strategy, one might indeed be hard pressed to find a silver lining.  However, one is surprised that the more pollyannish members of City Council have not seized on the obvious boost to Thunder Bay’s economy from the ample work being generated for plumbers, hardware purveyors, asphalting and landscaping companies – not to mention city employees – from the continual calls to replace interior plumbing and service lines.  Indeed, one is astounded that there has not been an economic impact tally of the boost to the city’s GDP from all the construction work and at a bargain basement price with respect to city coffers.

 

For a modest investment in sodium hydroxide of only several hundred thousand dollars a year over approximately three years – probably not more than $1 million - there have been thousands of homes that have had to incur thousands of dollars in repairs.  If one assumes only a modest 3,700 affected households (based on the current membership of the Thunder Bay Leaky Pipe Club Facebook page) and assumes an average of $5,000 in spending for each, why the direct spending impact is already just shy of $20 million dollars.  The economic multiplier is an astounding value of 20 – something unheard of in municipal economic impact circles and the likely recipient of an Economic Development Commission Powerpoint presentation or two at the next NOMA meetings.

 

It would appear that Thunder Bay City Council and Administration have been inordinately clever embarking on a massive urban infrastructure renewal program and doing it for a pittance.  Indeed, they have not even had to borrow as the stimulus spending in question has been provided directly by affected households or their insurance companies. The constant parade of diggers in many neighborhoods across town has given new meaning to the term shovel ready infrastructure projects and the demonstrable associated benefits of increased employment and income.

 

Indeed, this is the ultimate Keynesian aggregate demand stimulus activity.  It does not matter if the spending is needed or not, as long as it occurs, it can stimulate aggregate demand and create employment and boost income especially if there is involuntary unemployment. Involuntary unemployment is when a person is willing and able to work at the prevailing wage as opposed to voluntary unemployment which is something members of City Council are more likely familiar with.  The benefits of building projects was noted by Lord Keynes himself when he  noted in his General Theory that “Pyramid-building, earthquakes, even wars may serve to increase wealth, if the education of our statesmen on the principles of the classical economics stands in the way of anything better.”

 

Of course, it is unlikely that City Council deliberately embarked on this as a Keynesian economic stimulus program given that they probably do not know what Keynesian means.  Indeed, upon stumbling across  the term, they probably hear “Canesian” and think it is some type of descriptor of a program at the 55 Plus Centre on Red River for senior citizens who when afflicted with ambulatory difficulties make use of a pole-like device for vertical as opposed to fiscal stabilization purposes. 

 

However, if they are interested in expanding their understanding and implementation  of Keynesian policy, they might heed Lord Keynes when he wrote: “If the Treasury were to fill old bottles with banknotes, bury them at suitable depths in disused coalmines which are then filled to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to dig up the notes again...there need be no more unemployment…the real income of the community and its capital wealth also, would probably become a good deal greater than it is.”  One is surprised city workers are not dropping off bottles of cash for burial when water service lines are repaired so that affected homeowners can then dig them up again and generate yet another round of spending stimulus.

 

So, there you have it.  Thunder Bay truly understands the power of private enterprise and individual initiative as well as Keynesian aggregate demand policy.  That is perhaps why Thunder Bay City Council after discouraging a private solution now finally wants to harness private enterprise to build its multi-use turf facility.  The economic activity it has generated via the Leaky Pipe Expenditure Stimulator has generated enough of a boost to GDP and the tax base to now support a private sector turf facility option.

 

 

Costing of Ineptitude in Thunder Bay

 

Well the leaky pipe saga continues in Thunder Bay if one is to judge from the continued entries on the Facebook page of the Leaky Pipe club which now has 3600 members.  For those seeking a quick recap, in an effort to mitigate the environmental effects of lead pipes for an estimated 8,000 households in Thunder Bay, the City of Thunder Bay added sodium hydroxide to water which changed the pH level of the water (reduce its acidity) and therefore helped neutralize the lead content.  However, this additive was put into water going to all homes and it was apparently successful in reducing the amounts of lead.  However, after full extension of the procedure in 2018 following the 2016 pilot it appears that the incidence of pinhole leaks in copper piping of private homes and businesses in Thunder Bay has gone up dramatically. In the worst-case scenarios, not only is there corroded copper piping in the home springing leaks but also the service line goes necessitating repair bills in the tens of thousands of dollars.

 

While there are neighborhood concentrations of affected homes, chats with plumbing and restoration company employees – not to mention the odd nameless municipal worker - indicates the problem is actually more widespread than the City will acknowledge with homes across Thunder Bay affected and indeed even affecting relatively newer homes constructed over the last 10-15 years. It appears this chemical is highly correlated with the corrosive damage and the City of Thunder Bay stopped the additive in February of2020  in response but remains tight-lipped even in the face of the obvious continual plight of homeowners who during a pandemic have also been afflicted with the anxiety and trauma of every morning wondering if they are going to be the next “winners” of Thunder Bay’s leaky pipe lottery.   The fact is that probably all of Thunder Bay’s housing stock has been compromised to some extent and the question is only when things are going to happen.

 

In the end, this is all part of Thunder Bay’s complicated ongoing 25-year water infrastructure saga which has seen the move to one source water supply in the wake of the giardia saga on the south side two decades ago, the rapid increase in water rates to fund all the new infrastructure and maintain the old, the flooding of the new East End water sewage treatment plant – and surrounding neighbours - the introduction of sodium hydroxide to reduce lead in pipes on the cheap, and the removal of sodium hydroxide in the wake of numerous reports of pinhole leaks and more flooding   All of this has also generated several major lawsuits – for flooding in 2012 and now pinhole leaks in 2020.  

 

It is a mess and characteristic of municipal decision making in Thunder Bay given that in an effort to do important things cheaply – the best decisions are not made.  In the case of lead mitigation, the best long-term strategy is pipe replacement by the homeowners.  There should have been a proper financial incentive put in place by the City long-ago to get people to do it but that was probably seen as “expensive.”

 

Instead, despite concerns raised, the City of Thunder Bay went with sodium hydroxide.  While the City of Thunder Bay can argue that they made the decision with the best available information at hand, the province made them do it, and other cities have used sodium hydroxide with no such consequences it remains that something in Thunder Bay has gone horribly wrong. Was it something about the chemistry of Thunder Bay’s water?  Was it the application process when the chemical was introduced?  And what about the response of the City to so much distress?  In the end, even if one can accept that they made a decision based on the “science”, the response to so much resulting misery has been appalling.

 

If one wanted to do a simple summary tally of this penny-wise and pound-foolish approach of the ultimate costs of this entire imbroglio, it would be something like as follows:

 

Lead mitigation on the cheap by adding sodium hydroxide to City of Thunder Bay water:  Annual cost of $264,000.

Potential savings to the 8,000 homeowners with lead pipes by not having to replace their pipe at their own expense or at City of Thunder Bay expense: $40 million.

Potential cost to the City of Thunder Bay of lawsuit from homeowners affected by Leaky Pipes: $350 million.

Potential cost to the City of Thunder of lawsuits yet to come from insurance companies seeking to recoup their costs from all the claims in Thunder Bay: Yet to come.

The value of Thunder Bay’s short-sighted behavior, ineptitude and callousness in dealing with the fallout: Priceless.

By the way, in case you are wondering, I finally got to win big with Thunder Bay's newest lottery this week. 

 

 

 

Why Incentives Matter: An Example from Thunder Bay City Council

 

It is going to be a busy month at Thunder Bay City Council as the 2021 budget deliberations get underway.  The agenda for the meetings on the 19^th of January is quite lengthy with a raft of difficult to read budget documents.  However, there is also a meeting on the 11^th and that meeting also has a somewhat lengthy agenda with many items.  There is so much going on and little time to digest and comment so one has to be selective. 

 

An interesting item worth looking at for Monday’s meeting is a memorandum from the Manager – Central Support dated November 26^th “containing a motion recommending that City Council establish a loan envelope of up to $1,350,000 to support the Private Lead Water Service Replacement program.” This is a follow-up to the $50,000 in funding in 2020 that was supposed to be a grant program to help replace lead pipes but then transitioned to a loan program because it was deemed “not appropriate to continue to budget an annual contribution from the Stabilization Reserve Fund where the cost to administer the program is lost interest and administrative costs.”  Instead, the proposal is for an interest free loan program.

 

This is all part of Thunder Bay’s complicated 25-year ongoing water infrastructure saga which has seen the move to one source water supply in the wake of the giardia saga on the south side, the rapid increase in water rates to fund all the new infrastructure and maintain the old, the flooding of the new water treatment plant – and surrounding neighbours - the introduction of sodium hydroxide to reduce lead in pipes on the cheap, and the removal of sodium hydroxide in the wake of numerous reports of pinhole leaks and more flooding   All of this has also generated several major lawsuits – for flooding in 2012 and pinhole leaks in 2020.   

 

The City has remained tight-lipped on what it is going to do to address the epidemic of pinhole leaks but the connection to sodium hydroxide has not prevented it from once again embarking on the lead connection pipe problem.  The memorandum is an interesting example of policy making at Thunder Bay City Hall.  The $50,000 program has generated 24 applications which at $3000 per loan has generated a demand for loans totalling $72000.  So obviously, more loan money is needed, and the city has set $1,350,000 as the pool of loanable funds which at $3000 per loan means the city can issue 450 loans.  How clever.  The interest income foregone given current rates over the next ten years is low (apparently $100,000 in the estimate in the memo) and the City can even generate additional revenues by jacking up the fees from turning water on and off when the pipes are replaced.  Indeed, I am surprised the city has not yet thought of the latter.

 

So, here is the thing.  There are apparently upwards of 8,000 households in Thunder Bay that still have a lead connection pipe to the City water distribution system.  This means that the program is expected to “solve” the lead problem for approximately 6 percent of affected households. A program designed to completely solve the problem would require a much larger pool of funds – 8,000 multiplied by 3,000 – which would be $24 million.  And, there is no guarantee most households would take up the city’s offer. 

 

The incentive of a zero-interest loan of $3,000 for a project which based on the pinhole leak water service line replacement examples costs $5,000 to $10,000 is not terribly attractive.  Given the current loan program generated only 24 applications and not hundreds given the pool of 8,000 applicants suggests that this program will not be very successful. It is designed as a political solution to convey the impression that the City is doing something about the lead problem especially in the wake of the sodium hydroxide fiasco. 

 

However, economic incentives matter.  If the City was serious about addressing the lead connector pipe problem, it would use a cost-sharing grant program.  That is, it should pay 50 percent of the costs of replacing the lead connector line up to a maximum grant of say $3,000.  It needs a cost-sharing grant because realistically the obstacle to replacing the pipe on the part of homeowners given low current market interest rates is not access to loans but the total cost of the project relative to their household savings or income.  It also needs to cap the grant because an open-ended grant creates the incentive to generate escalating cost estimates on the part of service providers.

 

And, in the process of implementing this pipe replacement program it should also extend the program to city residents who have experienced leaks in their connector pipes in the wake of the introduction of sodium hydroxide.  Based on the leaky pipe statistics publicly provided on the Leaky Pipe Club Facebook page, it can be estimated that upwards of 3,000 households have experienced leaks over the last 18 months. Of these, a substantial fraction experienced not only household leaks but the failure of their connector pipe.  However, we do not know the official number of leaky pipe households or how many connection pipes have been replaced because the City does not release those numbers.  So, using 3000 households as a potential estimate and at $3000 per grant, would result in an estimate of $9,000,000 as the cost of a connector pipe replacement support program for leaky pipe households. And of course, this would be on top of the $24,000,000 estimate for the lead pipe households.

 

So, a total cost estimate for resolving these water issues comes to $33,000,000.  Is it a lot of money?  Certainly.  However, if we can spend $40,000,000 for a new sports facility and over $50,000,000 for a new police station, obviously money is no object.  It is politics.  The Mayor and Council obviously do not find the incentive of ribbon-cutting ceremonies for a lead pipe replacement sufficiently attractive events to put on their campaign literature or to attract provincial and federal cabinet ministers to the photo-op.  Basic water infrastructure and maintenance is not glitzy enough compared to spanking new water treatment plants or a shiny new turf facility or even a bridge or traffic roundabout.

 

Thunder Bay is fiscally constrained you say?  City councilors and administrators have seen the “light” and are now advocating only 2 percent tax increases so we cannot afford to do all of this? Think again!  Along with incentives being important in economic decision making, there is also the concept of the trade-off.  The cost of dealing with the water issue – lead and leaky pipes – can be estimated at $33,000,000.  The cost of the turf facility and new police station amount to $90,000,000.  It is time to choose.  And, by the way all this has to be done with tax increases kept as close to zero as possible given the City’s economic situation.  Putting forth a 2 percent tax levy increase is only the beginning.  It needs to go down from there.

 

 

 

 

Thunder Bay Residents Fight Back with a $350 Million Lawsuit

 

After months of silence on the part of their municipal government, residents of Thunder Bay affected by the leaky pipe pandemic have finally decided to launch a $350 million lawsuit against the City of Thunder Bay and have retained the services of a Toronto law firm that specializes in class action lawsuits.  Needless to say, this probably could have been avoided if the City of Thunder Bay had made some effort to acknowledge the financial hardship and inconvenience of affected property owners by rendering them some assistance.   Yet, on the advice of the City of Thunder Bay’s legal advisors, they chose to do nothing.  The result? When you have lawyers on one side telling you to do nothing, the best solution is to get a bigger lawyer.

 

In the end, I think a key issue here will not even be the addition of sodium hydroxide to the water per se as a lead control option but why sodium hydroxide was used rather than orthophosphate given so many other cities in Ontario use orthophosphate.  Another key issue is that after problems emerged, the city of Thunder Bay took so long to acknowledge there was even an issue and stopped adding the chemical to the water and followed up by rendering no assistance – doing and saying absolutely nothing aside from filling City coffers with additional water use and water shutoff revenues. A case in point, a pinhole leak problem became apparent in Folsom, California this summer and that city hired a consulting firm and by the fall proposed a solution.  Meanwhile, after nearly a year of leaks, Thunder Bay won’t even speak to the problems. And, this lawsuit probably does not deal with any potential health effects – physical or mental – that the addition of sodium hydroxide may cause.

 

The silence of the councilors on this issue is appalling given they are our elected representatives.  They remain silent because they have been advised to do so by the City of Thunder Bay’s lawyers?  Really?  They are not the board of directors of a private business – they are elected by the people to represent their constituents.  What are they thinking?  During the current pandemic do provincial premiers or the Prime Minister not publicly acknowledge the loss of life or hardship people are facing as individuals or residents of long-term care homes?  What kind of elected representatives hide behind their publicly tax funded lawyers during a time of crisis and then proceed to debate fireworks restrictions, new tourism signs, or new construction projects?  Are they inspired by popular perceptions of the legacy of Marie Antoinette?

 

The scale of the problem is evident from the number of people who have registered on the Leaky Pipe Club Facebook page.  Moreover, the problem is not over yet and will likely continue over the winter and into the spring.  The problem is city wide as Figure 1 (data from Thunder Bay Leaky Pipe Club poll) shows with higher incidence in the Northwood, Red River Wards and McIntyre Wards. Approximately one-third of reports are from the Northwood ward followed by 21 percent in Red River and 18 percent in McIntyre.  Of course, given the vintage of many homes in these neighborhoods, the local chatter has mentioned that it is homes from the 1970s that are to blame.  However, a reason so many homes from the 1970s have been affected is that there are so many of them in Thunder Bay.  As much as one-third of Thunder Bay’s current housing stock was built in the 1970s – particularly in the area of multi-unit dwellings like apartments.  Indeed, the $350,000 pin hole leak lawsuit filed by St. Joseph's Care Group for the PR Cook Apartments is probably the tip of the iceberg for apartments.  The other older neighborhoods all have more lead pipes - ironically, the people the sodium hydroxide was to help through lead effect mitigation.

 

 

 

Given the City is planning to spend over $40 million on a soccerplex and is considering a new $50 million police station, they obviously are not short of financial resources with which to provide help.  Homeowners in Thunder Bay are not only facing the prospect of catastrophic damage and the expenses for repairs, but home insurance rates will skyrocket across the city.  How is a city that is trying to attract investors reconcile a city with this infrastructure chaos as a “good place to set up business?” Obviously, the City of Thunder Bay thinks a $350 million lawsuit is fine but added onto the $375 million class action lawsuit from the 2012 flooding, one wonders what they are thinking?  Are the councilors throwing up their hands and somehow hoping the City can declare bankruptcy or the province appoints an administrator to bail them out? Is it time for the province to take over and defund Thunder Bay City Council?

Updated November 26th.

Municipal Autocracy is Alive and Well in Thunder Bay

 

The Mayor and Council of the City of Thunder Bay grow ever more divorced from the needs and interests of the public they are supposed to serve with their behaviour sometimes reminiscent of 19^th century Russian aristocrats.   They pursue grand public schemes and profess concern for the public but are deaf to plights raised that diverge from their own views of what is best for the city.  In this, they are aided and abetted by their administrators whose chief interest seems to be maximizing revenues and spending – at least in areas where they see fit. 

 

The situation of ratepayers and homeowners in Thunder Bay often seems to be akin to the welfare of  Russian peasants whose fate was the lot of the ‘unfortunates’ to whom ‘God is high above and the Tsar is far away.’  Just ask the homeowners whose pleas about the damages they are incurring to their property from pipes leaking are met with silence.  Indeed, there may be a lot in common in the general attitudes of the Mayor and Council of Thunder Bay and the Czar and his assorted Grand Dukes given that Czar Nicholas II filled in his occupation during the 1897 Russian Census simply as “The Owner of the Russian Land.”  I suppose the leaky pipe protestors last week should consider themselves blessed that the Mayor and Council did not summon mounted police to disperse them.

 

Nowhere is this autocratic arrogance more blatantly demonstrated than in the 2021  “Budget Survey” that Council is now asking input for on its website.  It begins by asking for a line by line ranking of programs in terms of importance to you that include: Roads, Winter Maintenance, Drinking Water, Wastewater (Sewer), Stormwater Management, Garbage and Recycling, Long Term Care Services, Parks, Recreation Programs and Facilities, Child Care, Libraries, Economic Development, Communication and Resident Engagement, Animal Services, and By-Law Enforcement. 

 

This is ceremonial accountability at its best as it allows for input on items so broadly defined that a ranking is meaningless.  Honestly, are we being threatened with an end to clean drinking water or garbage collection or a shut-down of City long-term care facilities, if we refuse to hand over our taxes?  Everyone knows that choices need to be made but there is a difference between explaining  the options and implicit threats of service cuts that smack of bullying ratepayers.

 

However, the most striking question is the one that brings the impact of COVID-19 into the budgetary discussion.  As the section reads:

 

“The financial impact of COVID-19, due to revenue losses and increased costs, has been estimated at over $8 million for 2021 (4.2% of the municipal taxes levy). City Administration will be presenting City Council with options to address these costs. To cover these increased costs, what option(s) would you support?

 

a.         Temporarily reduce/modify services in 2021

b.         Temporarily increase user fees in areas that have increased costs due to COVID-19

c.         Increase taxes in 2021

d.         Draw from the reserve fund that is set aside for emergencies and budget to replenish in future years.”

 

Take careful note of the nuances here.  First, the financial impact of COVID-19 for 2021 is set at $8 million but nowhere is there mention of the nearly $9 million dollars that has been received in pandemic aid to date from higher levels of government that has apparently resulted in a $1 million operating surplus for 2020. 

 

Second, the mention of these costs as 4.2 percent of the municipal tax levy is a hint that what the City probably really wants is a 4.2 percent tax increase.  This is an increase in spending on the 2020 tax levy of $199.4 of an additional $8.4 million and assumes there will be no additional assistance or support from the provincial or federal government in 2021.  Given that they did not have to draw down on emergency reserves for 2020, doing it in 2021 is a legitimate option that should be given greater weight.

 

In light of the twin pandemics of both COVID-19 and leaky pipes that have hit the homeowners and taxpayers of Thunder Bay, The City of Thunder Bay needs to limit its tax levy increase this year to no more than 2 percent as mentioned earlier this year.  Instead of bullying taxpayers by implicit threats to reduce their garbage collection or snow removal if they don’t get their 4.2 percent, they should look at making core services like roads, water, sewer, sanitation a priority while reducing their emphasis on other things or by looking for ways to do them more efficiently.  As to how to do it, it is indeed up to the administrators to provide the options and for the councilors to choose among the options - that is what they are being paid for.

 

And as a final point, they do need to provide affected homeowners some assistance with respect to the leaky pipe pandemic.  Without commenting on the situation or compromising their “legal position” they could in recognition of the economic and mental burden of the pandemic temporarily suspend the hundreds of dollars in fees they charge homeowners to turn off and turn on the water when faced with ruptured pipes.  Continuing to do so means they are treating the misfortune of the leaky pipe situation as simply an opportunistic source of municipal revenue. 

 

 

In Thunder Bay, A Plague of Plumbing Problems is Not a Municipal Priority

 

It would appear that Thunder Bay City Council is still maintaining its cone of silence regarding the plague of plumbing problems that have afflicted numerous homeowners, not to mention businesses and other institutions in the city.  Residents are growing increasingly frustrated by the silence in light of evidence that hundreds if not thousands of households across the city have been hit by leaks in their indoor copper plumbing and in many cases leaks in their city connection line to the water main.  The expense for some homeowners is running in the tens of thousands of dollars including the hundreds of dollars in fees that the City is charging to shut off and turn back on water at the shutoff valves in order to effect repairs.

 

Thunder Bay has had a long history of water system and supply issues and this is the latest installment in what is going to be a very expensive saga.  Given that these issues have emerged in the wake of the addition of sodium hydroxide to the water supply to combat lead pipes affecting about 8,700 residents in older neighborhoods, the reluctance of the City to comment is understandable.  Correlation is not necessarily causation, but the timing of the leaks in the wake of the sodium hydroxide addition is more than suspicious. On the other hand, there needs to be some public effort made to deal with the problems and the business as usual approach of the City and the accompanying silence of the mayor and councillors is not what our government should be doing.  We do not elect our politicians to ignore us.

 

The Mayor and Council are our elected representatives and their silence in what are now twin pandemics – COVID and the plumbing plague – essentially is leaving many of us on our own to deal with these issues while they pursue business as usual.  Indeed, this week the Mayor apparently lobbied the provincial government on community needs that included: Bombardier, operating funding to offset 2021 COVID-19 costs and lost revenues, infrastructure funding, and funding for additional hires for long-term care and to cover increased costs associated with COVID-19.  Nowhere was there public acknowledgement during this “important opportunity to advocate for our community” of the woes of so many local homeowners and residents.  The public needs to know that their municipal government is looking out for them and it becomes apparent that they do not have our back – unless it is to use it to carry the load of increased taxes to fund their priorities.

 

It would help immensely to know if there is anything we can do as homeowners to preemptively deal with the leaky pipe problem.  Are some neighborhoods affected more than others?  Is it a function of the age of your homes?  What signs should we be on the lookout for to catch the problem early? Are houses near corners more susceptible as some observations suggest?  Is proximity to pumping stations a factor in terms of water pressure or the amount of sodium hydroxide that was released? Instead, we are left with cobbling together evidence from rumor and social media of which the most important contribution to date is a Facebook page under the title of the Thunder Bay Leaky Pipe Club that now has nearly 700 members.

 

In the absence of publicly available evidence from the City in terms of incidence and distribution, we are left to our own devices.  For example, based on the above Facebook Page discussions it would appear that the leaks are occurring all over the city, even in newer subdivisions such as Parkdale.  However, there are particular concentrations in Northwood, River Terrace/Fairbanks, John Street and Valleywood areas. Indeed, a drive down James Street in Northwood a few weeks ago suggested that there was either a lot of landscaping being done or there has been a veritable plague of leaky pipes.  In the River Terrace neighborhood off John Street – a subdivision of about 200 homes – based on the dug-up lawns and the neighborhood stories – there have been 40 homes affected. 

 

That is a 20 percent rate.  There are about 50,000 private households in Thunder Bay which suggests that this problem may eventually affect 10,000 property owners. True, extrapolating from one subdivision of 200 to the entire city is not good science but given the absence of any official information it is the only analysis we can do.  In the absence of numbers from the City as to how much of a problem this is, we are left to wonder who is going to be next and how much it is going to cost.  Not only are most of us working from home during the COVID-19 pandemic, but now we also have to worry that we will be flooded out and hit with a ten-thousand-dollar bill.  As if there were not enough mental health issues in Thunder Bay.

 

So, here it is.  In Thunder Bay right now, based on the homicide rate, you have about a 7 in 100,000 chance of being murdered – in percent terms that is just over one-half of one percent.  if you get COVID-19, you have about a 1 percent chance of dying from it given the numbers to date – 109 cases and 1 death.  However, if you own a home in Thunder Bay, you have a 20 percent change of leaky pipes occurring and a plumbing bill that can range anywhere from a few hundred to many thousands of dollars.  Why is this not a priority?  How the Mayor and Council can still look at themselves in the mirror in the morning is beyond me.