NTIS, Town & OCWA settlement

Posted On Friday May 28, 2021

The Town’s annual Consolidated Financial Statement as prepared by the Town’s Auditors were made available to the public through the May 31, 2021 Committee of the Whole agenda.

Contained in the Town’s 2020 Audited Financial Statements are details about the settlement reached between the Town, the New Tecumseth Improvement Society (NTIS), and the Ontario Clean Water Agency (OCWA).

NTIS was formed in 1999 with the objective of financing, constructing, and managing the water pipeline from Collingwood to Alliston. 

To facilitate construction of the pipeline, a number of financing mechanisms were put in place, including a loan provided by OCWA. The water supply agreement spoke to the repayment of all debt incurred to construct the pipeline. 

All outstanding debt was previously addressed with the exception of the loan provided by OCWA.

At the end of 2020,  NTIS, the Town, and OCWA negotiated a settlement of the outstanding debt which was documented in minutes of settlement, agreed upon by all parties.

As agreed upon in those minutes of settlement, The Town will retire the OCWA loan for the total amount of $11,429,000 by the end of 2021. In consideration for the foregoing, OCWA releases all  interests it may have in the pipeline, including all residual rights it may have in easements, lease, or sub-lease rights.

The Town’s consolidated financial statement was posted to the Town’s website through the May 31, 2021 Committee of the Whole agenda and then posted to the Financial Statements section of our website here: https://www.newtecumseth.ca/en/town-hall/financial-statements.aspx 

The total principal loaned to NTIS from OCWA was $12.3 million. That debt was settled for a total amount of $11,429,000.

Up to 2019, there was $929,000 collected by the Town through the sale of water to third parties and paid to NTIS to address the outstanding debt as per the terms and conditions of the water supply agreement.

An additional $1 million was paid at the end of 2020 as per the negotiated minutes of settlement.

The sum of $9.5 million will be debentured and paid on or before September 15, 2021 and funded through development charges and water rates.