The idea of setting up a municipally owned corporation to manage Calgary’s water utility is “on pause,” pending the outcome of a provincially mandated inspection of the system, Mayor Jeromy Farkas said Friday.
In March, Farkas speculated that Enmax’s scope as a city-owned subsidiary could be expanded to include management of Calgary’s water utility. His comments, in an interview with a Postmedia columnist, came after an independent panel’s scathing review into Calgary’s water system following the initial failure of the Bearspaw South feeder main in 2024.
But on Friday, the mayor said the debate will be put on hiatus until the Alberta government’s inspection into Calgary’s water woes is completed.
“A significant portion of our activities are somewhat on hold because of the provincial oversight,” Farkas said, following Enmax’s annual general meeting.
While he said the city is moving fast on a replacement pipeline for the Bearspaw South feeder main, Farkas added some of the city’s longer-term plans to improve governance of the water system are suspended until the province’s inspection wraps up.
“We could potentially, as a city, be in a position where our independent panel report is making one set of recommendations and the provincial government could potentially order us to do different things or even opposite things,” he said.
The provincial inspection was announced in March, two months after the second failure of the feeder main. Municipal Affairs Minister Dan Williams said the probe — a rarely used mechanism in the Municipal Government Act to investigate impropriety on the part of cities or towns — will delve into the administration and management of Calgary’s water utility.
The inspection is being led by inspector David Goldie, who will assess how the city oversees its water infrastructure and determine whether additional provincial direction or corrective action is required.
Goldie will review city documents, examine operational processes and interview municipal officials and council members. He also has the authority to compel witness testimony under oath.
Williams said in March that the investigation should be concluded by the end of this calendar year.
Shortly before the province’s probe was announced, a similar independent investigation, led by retired ATCO executive Siegfried Kiefer, made several recommendations, including for the city to set up an arms-length corporation — similar to Enmax, or Epcor in Edmonton — to manage Calgary’s water utility.
Calgary Mayor Jeromy Farkas has touted the idea of having Enmax as the operator of Calgary’s water system. However, plans are suspended for now amid a provincial inspection of how Calgary manages its water system.
Less than a month after Kiefer’s report was published, city council approved a 27-point plan to carry out the full scope of the panel’s recommendations. The implementation plan aims to stabilize Calgary’s critical water system, establish new leadership and governance structures for the city’s water management, and develop more robust regulatory and risk mitigation frameworks.
The final phase of the plan, which officials said will likely take two years to carry out, outlines steps to transition toward a municipally owned corporation that would govern the city’s water utility.
While council approved that plan, Farkas said Goldie has asked him to wait until his inspection is complete before pursuing some of the panel’s longer-term recommendations, including the suggestion to corporatize Calgary’s water utility.
“It’s very premature, at this point, to be advancing that (recommendation),” Farkas said. “In my conversation with inspector David Goldie . . . he suggested to me to not make big moves like that, pending the review and recommendations that might be coming out of the minister’s office.”
Whatever directives result from the provincial review would supersede the recommendations of Kiefer’s report, if the two do not align, Farkas said.
“It’s ultimately up to the minister in terms of what he chooses to order us to undertake,” he said
“When it comes to ministerial orders, we’re bound to what the minister orders us to do. If that’s opposite of the recommendations of the report, we still have to follow what the minister orders us to do.”
Farkas said he hasn’t been formally interviewed but did have a brief co-ordinating call with Goldie. He said he welcomes the inspection.
“I welcome this look into what went wrong and what we’re doing to fix it, because what happened here in Calgary could have happened — and may well happen — in other municipalities across the country,” he said.
“Looking at the City of Calgary’s leadership on this, what we’ve been able to do to fix this as well as accelerate the (feeder main) replacement project, there’s a lot here that can be learned and applied to the rest of the province.”