Item - 2025.EX28.9

The Executive Committee recommends that:  

1. City Council adopt Parts a, b and c below and authorize the Chief Financial Officer and Treasurer and the General Manager, Toronto Water to implement a phased-in approach to increase the current 30 percent discount for Block 2 industrial consumers to 35 percent, as compared to the Block 1 rate, by applying an annual rate increase limited to a minimum of a third of the water and wastewater rate increase for Block 1 customers, expected over the next three years (2026 – 2028) or until the 35 percent discount threshold is reached:

a. effective January 1, 2026, an interim 3.75 percent rate increase for Block 1 and an interim 1.25 percent rate increase for Block 2  water and wastewater consumption rates (paid on or before the due date) charged to metered consumers as shown below and in Appendix A attached to this report:

b. effective January 1, 2026, an interim increase of 3.75 percent to the water and wastewater consumption rates (paid on or before the due date) charged to flat rate consumers, as set out in Appendix A to the report (November 25, 2025) from the Chief Financial Officer and Treasurer and the General Manager, Toronto Water; and

c. effective January 1, 2026, the water and wastewater interim service fees, as set out in Appendix B to the report (November 25, 2025) from the Chief Financial Officer and Treasurer and the General Manager, Toronto Water.

2. City Council adopt, with respect to assistance for low-income seniors and low-income disabled persons:

a. effective January 1, 2026, the interim water rebate for eligible low-income seniors and low-income disabled persons be set at a rate of $1.4589 per cubic metre, representing a 30 percent reduction from the Block 1 rate (paid on or before the due date).

3. City Council amend the following service descriptions in Chapter 441 (Appendix D) of the Municipal Code, by replacing them with the new service descriptions below, per Appendix C to the report (November 25, 2025) from the Chief Financial Officer and Treasurer and the General Manager, Toronto Water:

4. City Council amend the service descriptions for fees with Ref. No. 1, 2, 4 ,5, 6, 45 and 46 in Chapter 441 (Appendix D, Schedule 2) of the Municipal Code from Revenue - Distribution and Collection to Revenue - Capital Planning & Implementation, as outlined in Appendix C to the report (November 25, 2025) from the Chief Financial Officer and Treasurer and the General Manager, Toronto Water.

5. City Council authorize that the necessary amendments be made to Municipal Code Chapter 441 - Fees and Charges, Municipal Code, Chapter 849 - Water and Sewage Services and Utility Bill, and any other necessary Municipal Code Chapters as may be required, to give effect to City Council's decision.

6. City Council authorize the City Solicitor to introduce any necessary Bills required to give effect to City Council's decision and authorize the City Solicitor to make any necessary clarifications, refinements, including stylistic, format and organization, minor modifications, technical amendments or By-law amendments as may be identified by the City Solicitor, the Chief Financial Officer and Treasurer, and the General Manager, Toronto Water. 

7. City Council direct the General Manager, Toronto Water, with support from the General Manager, Economic Development and Culture, to take actions to improve uptake of the Block 2 Program from potentially eligible water consumers to further support industry competitiveness.

This report recommends the adoption by City Council of 2026 interim water and wastewater consumption rates and service fees as set out in this report. The adoption of these interim rates and fees is requested in advance of the 2026 Tax and Rate Supported Operating and Capital Budgets in order to establish these rates and fees and provide City staff with the necessary authority to implement them effective January 1, 2026. The recommended interim rates are established to meet Toronto Water operating and budget requirements which will be considered through the 2026 Operating and Capital Budget process ("2026 Budget Process"). These rates may be amended by City Council when the 2026 Rate supported Operating and Capital Budgets are adopted, which is expected in the first quarter of 2026.

Accordingly, this report recommends, effective January 1, 2026, an interim 3.75% water and wastewater consumption rate increase, as well as inflationary and cost recovery increases for certain existing water and wastewater service fees, reflecting the cost of providing these services.

This report also provides additional information on water consumption, as well as further details on the recommended interim 2026 water and wastewater consumption rates and service fees.