(File photo)

(File photo)

Regional District of Nanaimo opts not to build $6M water facility in Nanoose Bay

Staff report indicates renting is less costly

The Regional District of Nanaimo has dropped plans to build its own water facility in Nanoose Bay, as it would end up costing more in the long run.

Currently, the RDN is leasing a facility in the South Parksville Industrial Park for its water operations. The lease was extended for another five years in 2020 but at rate that is significantly higher. It has prompted the regional district to explore the feasibility, as well as cost-effectiveness, of constructing its own water facility on RDN-owned land.

The RDN chose for the feasibility study the land adjacent to the Nanoose Bay Peninsula Water Service Area, the largest service managed by the RDN water services department.

Carscadden Stokes McDonald Architect Inc, commissioned to conduct the study, reported a nine per cent increase in gross floor area from the existing program. A number of alternative conceptual building styles and layout on the land in Nanoose was presented and a final style and layout chosen.

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The estimated total cost (including the consultant’s fee of $36,000) would have beeen $6,000,000 that the RDN planned to borrow over 25 years at three per cent interest rate, $360,000 per year. But comparing the difference between the cost of ownership and leasing, RDN staff recommended to the board not to advance the major capital initiative.

Staff indicated the project would have been three times the annual cost of the current facility as an RDN-owned building, on top of the cost of construction, would need additional funds to pay for insurance, maintenance and life-cycle expenses.

Staff stated the scale of the difference between the costs of ownership and leasing supported their recommendation not to proceed with the project and to continue the current lease.

The RDN board agreed.


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