Good Governance in Municipal Restructuring of Water and Wastewater Services in Canada
Karen Bakker and David Cameron
November 11, 2002
 
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English

Over the past two decades, many jurisdictions have engaged in restructuring of water and wastewater services. The report of Part II Walkerton Inquiry recommended that municipalities review governance options for water supply services. Restructuring of water and wastewater operations usually addresses technical, financial, and governance issues.

In mid-2002, the Mayor of the City of Hamilton invited the University of Toronto's Munk Centre for International Studies' Program on Water Issues to conduct a governance review as part of a business case analysis aimed at setting up a municipally owned water and wastewater corporation as a subsidiary of Hamilton Utilities Corporation (HUC).

HUC has proposed that the city create a corporatized water and wastewater utility; this corporation, a subsidiary of HUC, would own and operate Hamilton's water supply and wastewater infrastructure assets. The Hamilton case will be of interest to communities and governments elsewhere, in part because restructuring is soon likely to occur in many Canadian municipalities, and in part because of Hamilton's well-publicised experiment with private sector participation in water and wastewater services management. The City of Hamilton's water and wastewater treatment facilities are operated by a private company, under the terms of the 10 year delegated management contract which will end in 2004. Because of the relatively high value of the contract, and controversial renegotiation with four successive owners, Hamilton's experience has been a closely watched by outside observers, and heatedly debated within the city. The City's restructuring process will thus be of great interest throughout Canada.

The report, authored by Karen Bakker and David Cameron:

  • provides an overview of restructuring in water and wastewater services, focusing on business models relevant to municipal utilities;

  • examines the governance of water and wastewater supply systems;

  • explores the governance of corporatized utilities, with special attention to multi-utilities; and

  • presents recommendations to the City of Hamilton emphasizing the importance of a comprehensive restructuring review process, with stakeholder participation, as an integral part of good governance of water supply.