Nestlé Waters Canada has offered to pay a voluntary levy of 50 cents to the Town of Erin for every 1,000 litres of water it pumps out of the ground in Hillsburgh.
Town Councillors received a presentation on February 1 by Nestlé Natural Resource Manager Andreanne Simard and Director of Corporate Affairs Jennifer Kerr. Council made no decision on the offer, but asked staff to prepare a report on the issue.
The deal would include a minimum annual payment to the Town of $25,000. Actual payments would have averaged $51,000 over the last three years, and could have been as high as $203,000 if Nestlé had ever pumped its maximum amount.
“We want to be consistent and add value for the community,” said Simard.
Nestlé has a provincial license to extract up to 406 million litres of water per year (about 1.1 million litres per day), which it trucks to its bottling plant in Aberfoyle, where they have another well.
The company has never pumped the maximum, with recent annual volumes ranging from 19.3 per cent of the maximum in 2015 to 55 per cent in 2013.
If the levy had been in place last year, when 82,269,338 litres were pumped, the Town would have received $41,135.
Kerr said the voluntary municipal levy is not related to the provincial levy. Bottled water companies currently pay the Province $3.71 per million litres, but the government is currently considering a plan to raise that amount by $500 per million (50 cents per thousand). MPP Ted Arnott is urging the Province to share some of that revenue with host municipalities such as Erin.
Kerr said it is a coincidence that the proposed levy rate increases are identical.
The Nestlé well permit is up for renewal this year, and it is not restricted by the provincial moratorium on new permits.
During the application for the previous permit in 2012, there was opposition from the Climate Change Action Group of Erin, Wellington Water Watchers and other residents concerned about the environmental impact of plastic bottles and the trucking of water, as well as potential harm to groundwater.
They also wanted the Ministry of the Environment and Climate Change to do its own groundwater monitoring, instead of relying on the bottling industry.
Councillor Jeff Duncan, who promised during the election campaign to seek revenue from the water bottlers, said at the council meeting he has been working to get Nestlé “to the table”. In a recent letter to Arnott, he said, “Host communities that do not have commercial infrastructure but provide the raw resource need to be compensated.”
In 2001, when the 128-foot deep well was owned by the Perrier Group, Duncan was the only member of council to vote against a rezoning to allow upgrades to the property, including a pump house, storage tanks and efficient tanker truck access via County Road 22.
At that time, Perrier had agreed to pay the Town a voluntary levy of 50 cents per 1,000 U.S. gallons extracted, about four times lower than the current proposal of 50 cents per 1,000 litres. Nestlé discontinued the voluntary levy about 2006, but did provide community grants of $10,000 for specific Town projects such as McMillan Park and the Skatepark.
In the 2014 election campaign, Duncan said, “For the amount of resource they are extracting from our area in both terms of quantity and revenue for that resource, we are being short changed.” He is not opposed to the Nestlé operation, but said last week he hopes the voluntary levy will help “correct the imbalance”.
Nestlé says data compiled by the Grand River Conservation Authority show that bottled water companies account for only .6% of all groundwater pumped under various permits in that watershed.
Other users include golf courses at 1.3%, fish farms 3.51%, rural homes 4.25%, livestock watering 4.41%, aggregate washing 4.47%, crop irrigation 6.02% and municipal water systems taking the most at 60.83%.
Nestlé has 50 monitoring points at 33 locations in the Hillsburgh area, measuring for possible changes in quantity and quality of groundwater and surface water, as well as biological and ecological factors. With hourly data going back 16 years, the company says their well has had no negative impact on neighbouring wells or the municipal water supply.
Simard said Nestlé cuts back its water taking in times of drought, as required by its license.
The Nestlé well is located near Station Road on the west side of the watershed boundary that divides the Town of Erin, in the Grand River watershed where surface water flows to Lake Erie. The wells for the Hillsburgh municipal water supply are further east, in the Credit River watershed. While Nestlé and the Town draw from the same underground aquifer, the zones of influence for the wells are separate.
In 2012, Nestlé bought the former Morette’s furniture factory property between its well property and the Elora Cataract Trailway, to create a buffer zone with no housing development. It is close to the new library planned by Wellington County next to the Hillsburgh millpond, and there have been discussions about recreational uses of these properties.
“We do quite a bit of community engagement,” said Simard, citing work with Everdale Organic Farmers, Green Legacy Programs, Well Protection Agreements and a $460,000 donation to support the University of Guelph’s G360 Centre for Applied Groundwater Research.
After the presentation by Kerr and Simard, Councillor John Brennan noted that the levy would help “create a better profile for you in the community”.
On Monday morning this week, Nestlé started an office hours initiative at the Hillsburgh Community Centre, with staff on hand to answer questions. “We encourage residents to attend and learn about the science behind the Hillsburgh water source,” said Simard. The next session is Feb. 27, 9-11 a.m.