Grey Owl Municipal Water feasibility study Grey Owl Board of Directors Presented August 27th, 2017 Fall AGM

Current situation Grey owl Estates is currently non compliant in two areas. Arsenic levels exceeds acceptable levels in two wells. Inadequate contact time for the sodium hypochlorite to mix with the well water. Manganese levels currently exceeds the proposed maximum acceptable levels for manganese in drinking water. Grey owl Estates is required to complete a compliance plan to become compliant in all of these issues in the future. The Compliance plan has been submitted and accepted by the government but it is still a working document that will continue to be improved.

Current situation Burns Maendel consulting engineers (BMCE) were retained by Grey Owl estates in the spring of 2017 to conduct a feasibility study. In august, 2017 a draft version of this study was shared with the board of grey owl estates. The draft feasibility study provided grey owl estates with two options to become compliant.

OPTION #1 Water treatment plant: A water treatment plant would be constructed to treat the water from grey owl estates 5 existing wells. This option would also include some upgrades to Grey Owl estates existing infrastructure to provide proper water pressure and operation. INCLUDES: 30X50FT Building. Equipment to filter, treat and discharge waste water.

Option #1 PRos Will not have to purchase water. Can continue to use existing wells.

Option #1 Cons High Capital costs. Have to maintain a trained operator with training on Grey Owl Estates new water treatment plant. Operational costs for power, chemicals, membrane replacement and equipment replacement, will be much larger than our current system. Likely the water treatment plant will need to be heated year round, even though it will be used seasonally.

Option #1 Cons The water treatment plant will need to be serviced by a sewer system to handle the rejected concentrate produced during the treatment process. Grey owl estates would be required to pay the municipality for the for the disposal of waste created during the water treatment process. Grey owl estates would need to pay taxes on the water treatment plant building. Need to find a suitable location for a water treatment plant.

Option #1 Cons Future changes to drinking water guidelines may result in upgrades being required for the water treatment plant. Rreplacement costs will need to be included in reserve fund.

Costs of option #1 A high level cost estimate was completed for option #1, water treatment plant. The cost for option #1 was $904,860.00

Option #2 Municipal Connection: installation of water main to existing grey owl estates water system from the existing municipal water system. This option would also include upgrades to the distribution system in grey owl estates to ensure proper pressure distribution. Run new main lines along victor avenue Install manhole with metering equipment Tie in to grey owl water mains

Option #2 pros Requires significantly less capital than the water treatment plant option. Reduces the overall infrastructure owned and managed by Grey owl estates. Fully treated water meeting cdw guidelines will always be supplied by the system. Future upgrades to meet new drinking water requirements are the responsibility of the municipality.

Options #2 pros Some liabilities associated with the operation of a public water system will be passed on to the municipality. Less demands for our maintenance person, possibly resulting in an easier hiring process in the future. Much less water testing required for grey owl estates to complete. Allows for usage of the main waterline that grey owl unit holders have already paid for in the form of the $2000.00 fee from the RM.

Options #2 Cons Will have to purchase water based on a metered volume. Requires installation of additional infrastructure in the municipality’s right of way in order to service the grey owl site resulting in additional upfront capital costs which may or may not be recoverable over time. Existing wells will be obsolete and will need to be decommissioned.

Engineer recommendation Based on the high cost and complexity of the stand alone treatment plant; engineers recommended the municipal options as the likely best alternative. Based on this, a more detailed class d estimate (+/- 30%) was completed for the municipal water option. As the municipal water hook up is recommended by the engineers a class d estimate was completed for the municipal water option. This estimate is more detailed and reliable than a high level estimate. The estimate for option #2 was $285,248.00

More detailed costs Description Cost Off site watermain installation $107,950.00 On site watermain installation $90,000.00 Sub total $197,950.00 Engineering Fees (approx. 10%) $19,795.00 Construction Management Fees (approx. 10%) Sub Total $237,540.00 Project Contingency fees (20%) $47,508.00 $285,048.00 Plus 30% $370,562.00

Costs At this time, we project a cost between $285,048.00 to $370,562.40 based on these estimates the cost per unit would range from $1325.80 to $1723.55 per unit. Does not include water usage cost. Method of charging unit holders has not yet been determined.

Potential impact to cost estimate Potential changes to final design Potential escalating construction costs Potential cost share to tie-in to existing line running partially along victor to minty rental unit Potential cost for hydrants along victor and cost recovery from others hooking onto or extending grey owl line.

Next steps Obtain a finalized engineering feasibility study from BMEC. Secure Secure a proposal from BMEC to provide a detailed design and specification package for tendering. Meet Meet with RM to see if there is any financial assistance available for the project. Hold Submit our engineering plans to the RM and water drinking office for approval and to obtain permits. * not necessarily in this order. * Provide update on final design and tendering to unit holders at spring AGM. Submit Hold a special meeting this fall or winter for unit holders to vote on a motion to accept the engineer report recommendations and proceed with the hookup to the municipal water system and move ahead with detailed design and tendering. Next steps

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