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14th June 2015
Kensington's offer to upgrade Union Bay's water system uncertain

Trustees reject developers request to extend deadline by another four months

Michael Briones/Echo Staff / Comox Valley Echo
June 12, 2015 10:12 AM

Kensington Island Properties wants to fulfil its commitment to finance upgrades to Union Bay's water system.

That should have been good news for residents. It is not going to cost them a single cent. But it wasn't.
Even with a one hundred per cent funding incentive, KIP owner Brian McMahon wasn't able to convince Union Bay Improvement District board of trustees to endorse it.

That was the news the over 150 residents heard at a public meeting recently organized by McMahon, whose intention was to clarify misinformation floating around the district and where the project currently stands.

People at the meeting applauded Kensington's generosity and were clearly in favour of not having to pay any taxes on it. Some criticized the stubbornness of the trustees for wasting this golden opportunity and for choosing to pursue a comprehensive water plan of their own that would require use of taxpayers' money. Some wanted to know why this project is not moving forward.

One resident pointed out there is urgency to this matter because of the quality of the district's water. It is a "health issue" he said.

KIP made this funding commitment when it signed the Master Development Agreement with Comox Valley Regional District in April 2010. It is also honoring the water infrastructure agreement it reached with UBID in April 2011 but was given a deadline of Dec. 31, 2014. The project was not able to proceed sooner due to a long-standing issue with the provincial government over the remediation of the contaminated coal hills.

McMahon said they have been negotiating with the province to get this important hurdle cleared in the last 16 years. Nothing happened until last October 2014 when an agreement in principle was given to Kensington to proceed with its plans.
For McMahon, it was an important piece of the puzzle that would finally allow the water infrastructure plan to get underway and eventually get his housing development going.

The plan is to upgrade the existing water system to the 4-3-2-1 Island Health standards. It would include installation of a proper filtration system, chlorination system and down the road a Ultra-Violet system.

McMahon said he informed the regional district and UBID they are ready to proceed. But Union Bay trustees, McMahon explained, told him unless the water system is in place by Dec. 31, 2014, the agreement becomes null and void.

McMahon requested the trustees for a four-month extension but it was rejected. The agreement has now expired. McMahon has now sought legal assistance to enforce the Force Majeure clause in the agreement that would allow KIP some flexibility with the project's schedule.

"Because we're dealing with government timelines don't matter," said McMahon. "The government has delayed this project and this clause gives us the ability to extend the project. All we asked is four months but we were denied."

McMahon said they are ready to proceed as they as have all the engineering works in place and a dissolve air flotation system design by Corix. As well, KIP is offering to replace the antiquated pipes, most of which are asbestos cement pipes that water goes through.

"They're starting to dissolve and decay and they need to be replaced," said McMahon. "What we said we would do is we will replace all of them. It's a costly venture and it wasn't part of the agreement. But we said we would do that because it needs to be done."

The initial upgrade cost was $1.2 million but with the inclusion of the pipe replacement, the price has doubled to over $2 million. On top of this proposed undertaking, Kensington is committed to building a permanent water treatment facility five years from now as soon as they start building houses.
McMahon said if they are given approval they can complete the upgrades in five months and be operational this year.

UBID owns the right to the water source and is the only one that can permit extraction of water from Langley Lake and storage. Any development has to be approved by UBID.

The Union Bay trustees have been working on acquiring a parcel of Crown Land on upper McLeod Road in the last two years in which it plans to build the district's water reservoir. But just before it could be finalized this year, the initiative was stymied because the K'omoks First Nations filed an objection. The land UBID was trying to secure happens to be an integral part of an ongoing treaty negotiation between KFN and the province.
Chief Robert Everson criticized UBID over the manner in which they tried to acquire the land.

"While the normal consultation process is led by the province, common courtesy and protocol would require that you meet with K'omoks prior to submitting the application," Everson told UBID chair, Carol Mostad in a letter. "However, this was not done. So, it would appear that either the UBID did not want us to know about the application or that the UBID simply chose not to follow the expected protocol. In either case, we are disappointed with the conduct of UBID in this regard."

One resident at the public meeting said UBID has told them they have been negotiating with KFN over the land acquisition. He asked the Mark Stevenson, the legal counsel of KFN who was at the meeting, to confirm whether that was true.

"I don't know what they told you but K'omoks has never received any formal consultation notice from anyone until about two months ago," said Stevenson.

The chair of the UBID board of trustees, Carol Mostad, said at this time, she's not ready to give a response to the whole issue.

"The board is quite disappointed that the community is angry and upset again," said Mostad. "We're taking it all very seriously and we are going to respond and we will be holding a public meeting."

No date and time has been set for the public meeting.

A petition has now been circulated in the community asking property owners whether it supports funding of a new water system with UBID ratepayer tax dollars when an equivalent water treatment system can be provided immediately by KIP, at its expense by upgrading the existing UBID water works.

If residents support the UBID water plans, they most likely would have to dole out over $2,500 in taxes annuall to pay for it. The district is also facing more tax increases down the road with the South Sewer Project also looming on the horizon.

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