Host: Kingston is looking at changing how it handles water and wastewater. And let me tell you, not everyone is happy. The city is facing the same challenges as a lot of other places in Ontario. Its pipes are ageing, and it's worried about how it's going to pay for repairs in future growth. So it's looking at creating something called a municipal services corporation. The city says that it would provide greater financial flexibility, more borrowing capacity and opportunities for revenue, but it's kicking up controversy.

Citizen's Watchdog Ad: We say the process has been murky and the public has been ignored.

Host: Now, that's part of a radio ad from a citizen's watchdog group that's telling residents to say no to a municipal services corporation. So why the objections? Well, there are concerns around higher rates, less transparency and creeping privatization. So we are going to dig into how these corporations work and whether they're the right answers for Ontario communities.

Host: Then you're probably familiar with the Great Lakes. But what about the so-called northern Great Lakes? Well, experts say that Great Bear Lake, Great Slave Lake and Lake Hazen are among the most understudied in the world. But new research reveals they have a lot to tell us about the effects of climate change. This is The Rundown.

Host: Many Ontario municipalities are struggling with ageing infrastructure and how much it will cost to upgrade and expand. But water and sewers aren't optional. Expenses could things called municipal services corporations be the solution? From Washington, DC, Michele Grenier is executive director of the Ontario Water Works Association, and here in studio, Barbara Robinson is the president of Norton Engineering. Michelle, great to have you on the line. Barbara, great to have you in our studios to be here. Typically, we are a acronym Free Zone, but there is an acronym that we are going to be using a lot during our discussion. It is MSC stands for Municipal Service Corporation. A lot of councillors across this province have been talking about. It's been part of their lexicon. Help me understand what is a MSC and why are we talking about it so much?

Michele Grenier: Yeah. Great question. So an MSC is an arm's length corporation. We have them across Ontario. They're very common in the electricity field. The gas companies have them. And we're starting to talk about developing MSCs for municipalities, and the MSC would own and operate the the water and sewer systems. And there are some advantages and disadvantages, which I guess we're going to discuss here. But anyway, it's an arm's length Organization so that the water and sewer systems, instead of being governed by councils, would be governed by an arm's length Organization.

Host: All right, Michelle, help me understand a little bit. When we talk about we're talking about water and sewage. I'm thinking of ageing infrastructure. Is that why we're having these conversations right now across this province?

Michele Grenier: Yeah, I'd say there's a few reasons. And one of them is asset renewal. So the MSCs, the Municipal Services Corporation, have the ability to access different financing tools and funding tools than some municipalities do directly. Municipalities have debt repayment limits that are mandated. And so the the transfer of assets to the MSC allows them to forego some of those restrictions.

Host: Now, Barbara, we're going to go through a couple of municipalities that are kind of navigating the process right now. But does the size of the municipality matter when we're considering an MSC?

Barbara Robinson: Well, it's funny, the C.D. Howe Institute did an article on MSCs a year ago. And in their article, of course, their their financial people, which I'm not. They mentioned that they thought they would be more appropriate for smaller municipalities. But what we're hearing around the province, I think, is larger ones. Certainly if municipality is providing water or sewerage services to other municipalities, like cross border sharing agreements, we do that already, but we just have something called a cross border sharing agreement. Sorry, that was almost an acronym.

Host: That was almost an acronym. There you go. Where do we see that in terms of examples there?

Barbara Robinson: Kitchener-Waterloo has a bunch of them. That's where the Waterloo system, the sewers, it's easier to dump them into the Kitchener system than pump or whatever. So there's all kinds of them around. I would think most regions probably have them. Yeah. So I would I would just mention just talking about access to, to additional funding as Michelle talked about. My concern with that is we are in an infrastructure deficit situation. We are behind in looking after our infrastructure. And we have been for many years. So some of the some of the advantages are cited. Well, we can we can borrow a lot more money to, to, to catch up with this infrastructure deficit. Well, you know, I'm not keen on borrowing a lot more money than we're borrowing now because our children and grandchildren are going to have to pay for this at some point. We have to stop borrowing money and fix the stuff we've got with, have the political will to do what we need to do to get our systems back up to snuff.

Host: Help me understand this. I'm under the impression that municipalities have to balance their budgets every year. Is this a sort of using an MSC as a way to kind of plan for the long term, but not necessarily make a hit for constituents in the moment?

Barbara Robinson: So that I'm not entirely sure of. Certainly municipalities carry debt and they have favourable interest rates, but perhaps Michelle knows better whether whether their debt. I mean, there's a limit to how much they can borrow, just like an individual. But the limits would increase with an MSC, potentially. But that just means we're going to borrow more and more and more against our children and grandchildren's future.

Michele Grenier: Yeah. I think where there are advantages is you can. So municipalities do carry debt. They also carry reserves. And those reserves have to be set aside for if they're collected specifically for water, wastewater infrastructure, then they have to be used to deliver those infrastructure elements. Where the MSC may have an advantage is that they can make decisions that are that extend beyond political terms, and you can look at investing in the system, and you can make hard decisions about rates and, you know, development charges and things like that that go beyond the scope of your term as an elected official. Because one of the key features of the MSC is that they are intended to be set up with independent skills based boards. And so ensuring transparency and ensuring accountability in terms of how those systems are funded and financed is very important because you want them to be as transparent, as accountable as a municipal council, but they also have a little bit more freedom in how they make those investments and how they make decisions about which projects to prioritize.

Host: There's a few points I want to pick up on there, but I actually want to take a step back a little bit. Michelle, we know, and Barbara, that Peel region will be implementing an MSC. Kingston recently voted to exploring the implementation of one. Innisfil has had one since 2016 and Collingwood just rejected one. So in terms of sizes of municipalities get a good sort of idea there and regions. Michelle, what are the main factors municipalities should be looking at before deciding yes or no?

Michele Grenier: I think first off, the size one is important. If you look at the Union water supply system, they recently incorporated an MSC because the municipality could not borrow enough money to fund the upgrades that they needed to make because they are experiencing such significant growth. So that's one aspect that's sort of at the smaller range of the system. At the broader scale. The MSC, as Barbara mentioned, allows a municipality, or I should say a system. If we're looking at regionalization, it allows you to operate a system beyond municipal boundaries. So if you look at the Lake Huron water supply system that supplies London and seven other municipalities down from Lake Huron, that's a joint management board. It's a slightly different model, but the philosophy is the same. So you can can amalgamate water systems without having to do a political amalgamation. And so their economies of scale to be realized there. There is a significant reduction in red tape that can be achieved. And that's so that's sort of at the broader scale in the Peel situation. Again, it allows the three municipalities within Peel Region to work together to manage their infrastructure without having to have a regional structure.

Barbara Robinson: I do have a big caveat about all this, though. When we. So water and sewer are very closely related to roads, stormwater engineering, infrastructure, all kind of goes it kind of goes together. And when we create an MSC, now we have another party, a third party, owning water and sewer, while the municipalities are going to retain the other stuff. So whenever we have two different municipalities that have an interest in the same stuff, for example, the regional structure that we have now, there's a lot of double work getting done and things are getting missed because we have one set of priorities and priorities of council budgets, stressors and a second set that are different. And I see this between regional municipalities and local municipalities a lot. And there's a lot of tripping over either forgetting stuff or tripping over each other. So from a technical point of view, like down in the weeds, I'm concerned about another.

Host: I am curious, you know, as we talk about municipal service, corporations can issue debt to fund new water infrastructure, wastewater infrastructure. We talked about the list of things that municipalities do have to balance day to day. And I am curious, are there any pros to removing that task from the municipality and moving it to an MSC?

Barbara Robinson: Well, I think Michelle spoke very well to the pros. There are a number of pros, to be sure, but with my research that I've done across Ontario, I've had occasion to interview everybody in the industry inside out and backwards for years. And what I hear from regional municipalities versus local municipalities is that they don't get along with each other. They don't respect each other. So the locals are always complaining about the regions. The regions are always complaining about the locals. I was city engineer at Kitchener, so I had occasion to work with the regional Waterloo. And yeah, there's there's, there's not a lot of working together going on, not not to the extent that there should be. And this is causing us problems.

Host: When we look at Innisfil, I think that's a good example of one that, as you mentioned, ten years. Is there some lessons that we can learn from there in terms of what perhaps has gone wrong in terms of an MSC or what's gone right?

Barbara Robinson: Yeah. Well, I wouldn't say something's gone wrong, but I've certainly worked for in services and for Innisfil directly. And the thing I mentioned about two levels of government, whatever certainly occurred there where there was a lot of tripping over each other, you know, different filing systems, different different mapping, you can imagine all the complexities that go along with engineering. So and different priorities. So I see that everywhere. But I certainly saw that in Innisfil.

Host: Michelle.

Michele Grenier: I think to Barbara's point, the relationships between the two tiers are, I'd say some are better than others. Yeah. And I do think it makes the case for there are advantages to having a single tier system. My. My personal opinion is that we should go up rather than down. But that's obviously not for me to decide. But I think it's important to understand that there are a lot of MSCs that already exist, particularly in the electricity distribution side, and they've worked very well for decades now. They do have separate regulations in terms of rate setting. And again, you know, they're their own corporate structures, but there are a lot of wins to be seen in in that experience as well.

Host: Michelle, help me understand the, the structure of an MSC in terms of accountability and transparency to taxpayers and voters. How does that structure look? Is it a representation from council on, on these on these boards?

Michele Grenier: It's not entirely clear how that's going to be set up in in the peel region case, let's say specifically. But in the other entities, there is normally some representation from elected officials, but the rest of the board members are industry experts, finance experts, legal experts, risk management officials. And so there's a there's a much broader approach to managing the Organization. And the corporation itself is set up where the municipality is the sole shareholder. So that's how they report back. So the company would appear on the municipal balance sheet. So it's an asset just like a treatment plant would be. But then the assets are held within that company.

Host: Barbara.

Barbara Robinson: Although I checked some legal sources, obviously I'm not a lawyer, but it appears that there are mechanisms by which private corporations could invest in these MSCs. We keep saying totally owned by the municipality. But again, according to the legal sources I researched, there is a possibility to to have a part of it privately owned.

Host: Are there concerns that.

Michele Grenier: I'm I'm going to jump in. I'm going to say they can have external investors, but they need to be public entities as investors. So there's a difference between the Municipal Services Corporation and a public utility corporation. And again, I know it's a nuance, but but there is one where you could have private investors, but the MSC is set up to be publicly owned. So whether those investments would be pension funds and other sort of public financing tools is still to be resolved as we move forward in this in this new world of municipal servicing.

Host: Michelle, would there not be concern if we are getting investment from a private entities that perhaps that they are not beholden to taxpayers and voters, but instead to shareholders?

Michele Grenier: Well, again, we already we already have this. A lot of our transit systems are funded through public private partnerships. We have a new wastewater treatment plant being built in Mapleton, you know, by virtue of public investment or private investment. That is a risk. But I think we are there is only one taxpayer at the end of the day. And if we don't find other means of funding these systems, to Barbara's point, they're they're going to continue to deteriorate. And. And the time to make those improvements in the systems is. Now.

Host: Barbara, you had mentioned Kitchener-Waterloo. That's home base for you. Yeah. Has been in the headlines quite a lot. When we talk about why they. They ever help. Me a little bit. What's what's the concern and issues right now when we talk about the sort of water and the infrastructure in place right now, when it comes to sort of building and growing the city?

Barbara Robinson: Yeah. So so there has been a development freeze in Kitchener-Waterloo. In November of last year, the region of Waterloo took a well offline to do some service to it. And when they did, they discovered water levels were lower than expected. This is sort of surprising because all wells have water level. The water level should be available. It just means somebody wasn't tracking it or looking for it or whatever. So it turns out that the the capacity, the water capacity was 97% spoken for. So suddenly they became concerned, well, obviously, about the ability to manage additional growth. Now, I will say when I spoke about that two tier situation, that's this is exactly what happened in Kitchener-Waterloo, because water and sewer are directly connected. So sewers leak. And when they leak, rainwater and groundwater get into them. And so all over Kitchener-Waterloo, we have water supply wells, 120 of them, and they're all located right in the city, right beside sewers, which are leaking. So I'm saying to the region, look, the sewers are leaking. If we cut, if we fix up these sewers and get rid of the leakage, the groundwater will stay in the ground. We'll have more water for drinking water.

Host: Where does the money come from to address a need like that? If it isn't an MSC?

Barbara Robinson: Well, there's hundreds costing hundreds of millions of dollars and it's going to come from the taxpayer or the ratepayer or whatever. Yeah. So so people are going to pay and pay and pay. It's it's really distressing.

Michele Grenier: Well, I've been involved in the Waterloo situation as well. And, and with respect, I'd say it's a little bit more complex than the way Barbara has portrayed it. But the region does have a very distributed system. It isn't it is not comparable to other municipalities like Brantford or Toronto. But I agree it is going to require an investment from the ratepayers, and likely the province will have to help with some funding in terms of getting them caught up so that they can unlock that development capacity. But they do have a very solid plan to move that risk management framework forward.

Host: This is a plan that we are going to see more and more of as we start talking about this throughout the province. So we look forward to following this story. I want to thank you so much, Michelle, Barbara, for your time.

Michele Grenier: Thank you so much for having me.

Barbara Robinson: My pleasure.

Host: New research reveals how a warming Arctic is affecting vast lakes in Canada's north, and has scientists raising the alarm. Kathleen Ruhland is a senior scientist at the Paleoecological Environmental Assessment and Research Laboratory at Queen's University, and she joins me on the line. Great to have you, Kathleen. How are you doing?

Kathleen Ruhland: Great. Thanks for having me.

Host: Help me understand. Why did you choose these northern lakes for research. We're talking about Great Slave Lake, Great Bear Lake and Hazen Lake on Ellesmere Island. As the focus of your study.

Kathleen Ruhland: Well, these are three of the largest and deepest lakes on earth, particularly Great Slave and Great Bear Lake. They're the largest lakes by area and volume that are entirely within Canada. And yet we know very little about these lakes. So the Lake David Schindler, back in 2001, wrote in a paper that the lack of knowledge on these lakes is a national disgrace. So I think most of your viewing audience would probably be more familiar with Laurentian Great Lakes, but Canada really has 3 or 2 of the largest lakes in the world that are north of 60. So, for example, Great Slave Lake and Great Bear Lake would fit the size of the country of Belgium in them. So it's huge and they're very deep. So great slave Lake, for example, could fit the CN Tower with room to spare. And the Great Bear Lake could fit the Eiffel Tower with room to spare. So our past research that's led by Doctor John Smol, he heads our lab here at Pearl. Our past research on small and medium sized lakes have found really big biological responses to climate warming in the Arctic. But these large, huge lakes are extensively ice covered for most of the year, and we really find them to be quite resilient or protected from the full impacts of climate warming. So one of the things that we set out to do, because now the Arctic is heating up to 3 to 4 times more faster than the global average. So we wanted to see whether these huge, big sleeping monsters, they're not waking up. Are they going to respond similarly? Or have they responded to this new climate regime? And that's what we're hoping to find out. And that's what we found out.

Host: Well, we're talking about these giant, vast bodies of water, but we're really going into onto a microscope and looking at these small microorganisms in layman's terms, help us understand diatoms. There are different kinds of algae, but generally, and we'll get into the specifics a little later. But generally, why are they important to the ecosystems?

Kathleen Ruhland: Well, they are the bottom of the food chain or food webs in. And they are the main algal or the main primary producers in oceans and in our lake systems. So they photosynthesize. So they're like, you know, the algae of the water bodies are like grass and terrestrial systems. So they feed the rest of the food chain and they provide energy to the smaller organisms all the way up to the, the fish species. So there are very essential to keep that ecosystem fuelled. So and their cell walls are made out of glass and they're quite beautiful. But in terms of how we use them for our purposes, for our research. So we want to go back in time. We are paleo limnologists. So we want to look at lake systems and past lake systems, and we want to use that to establish what the environment was like before anthropogenic, you know, impacts. So these diatoms, because they're made out of cell, their cell walls are made out of glass. They preserve really well in sediments. So for example, you know, once they die, they sink to the bottom of the lake and they become part of the they get incorporated in the mud. So day after day, year after year, for hundreds to thousands of years, they accumulate at the bottom of the of these lakes, and they become part of the fossil record. So it's like, we could use that as a kind of a time machine for these lake ecosystems. So we can go to that lake and, and take a core or take a tube of that lake sediment. And we have a means to date them. So we know that at the bottom of the core, it's maybe 1850. And at the top of the core, it's 2000. And then we would spend a lot of time looking at the diatoms. So my colleague Neil McLeod, he looked at the Lake Hazen cores and we would spend time looking at these diatoms. And, you know, there's thousands of species. So a whole assemblage of species might prefer, you know, open water, light conditions, and a whole different assemblage would prefer lighter or darker conditions and maybe more ice cover in that kind of thing.

Host: Well, let's talk about.

Kathleen Ruhland: We actually have some images of that. So I want to pull that up.

Host: Oh, sure.

Host: The first photo shows the type of long diatom usually found in these northern Great lakes. The measurement at the bottom of the photo is in micrometres or millionths of a metre. Now, the second photo shows the kind of pancake diatom that is appearing more frequently in those lakes as a result of climate change. Besides the shape, which is quite obvious here, what are the main differences, as you were just alluding to a little bit in terms of how they sort of sort of deal with sunlight, but the shapes themselves are quite important as well. When we talk about the ecosystems being at the bottom of the web.

Kathleen Ruhland: Exactly. So that larger diatom that you first showed us, that's a kind of it's shaped like a tin can. And they're very heavy. And in the water column, they require turbulent conditions or the movement of the water to keep them afloat in the photo zone because they're photosynthetic organisms. So they need the sunlight to photosynthesize, whereas the smaller pancake sized diatoms, they're very prolific and they are more buoyant. So as conditions change with warming, for example, the water column would heat up. So it's not as the mixing patterns would get diminished, the water column would heat up and the cold water would sink. And we have lighter, warmer water on top that forms these layers. And we call that thermal stratification. So that is bad news for these large diatoms because they would quickly sink out of the competitive arena. Whereas these small little pancake shaped cyclotella attacks, this is their prime environment. And so they tend to flourish under these conditions. And so that's the kind of thing that we would look at. That's a physical change in the environment. But diatoms are also very sensitive to different chemical cues as well.

Host: I am curious in terms of the size themselves, what does that mean for zooplankton who are eating on diatoms? And then as we move up the food chain for fish.

Kathleen Ruhland: That's an excellent question. Yeah. So those large pancakes, those large, you know, tubular diatoms, they're very calorie rich, lipid rich diatoms. And they're a very important or nutritious food source for these smaller kind of little organisms that feed on diatoms. Whereas the pancake shaped diatoms, these small cyclotella taxa are more nutrient poor. And so, you know, there's a big shift in the food source. So in the past, those large diatoms were what dominated, for example, in Great Slave Lake for hundreds of years, the environment was very stable for hundreds of years. And that was the dominant taxon throughout that lake. And then at around 2000, at the turn of the 21st century, we suddenly get a shift towards these very small, prolific, pancake shaped diatoms that are poor nutrient source for the next chain in the food link. And so we have an example of that in. So we can make a comparison, for example, to Lake Michigan. So our colleagues in Minnesota have looked at very similar changes. So they took a core much like we did, and they found very similar changes with these large diatoms shifting to these small taxa. And that had really big repercussions all the way up the food web, where that next link in the chain actually didn't fare well. It was completely collapsed. And that had real big repercussions for, you know, the fish species up, up the food chain. Whether that will happen in these lakes is really hard to tell because it's a different system. We don't have invasive species like zebra mussels, as we do in the Laurentian Great Lakes. And, you know, the impact human impacts are minimal. But I think, you know, it may play out a little differently along these lakes, but certainly this is an early warning sign that things are going to change.

Host: Well, let's talk a little bit about that. You know, as we mentioned, these are lakes that for the most part are quite isolated, very far from where I am here in southern Ontario. What does this all mean?

Kathleen Ruhland: Right? So if you're living in Toronto, you might think, well, why would I care about these, these lakes? So if you're living in the north, of course, these are very important lakes for they're one of the most unpolluted systems or Great Lakes in the world. But they're important for things like transportation and food security as well as cultural identity, that kind of thing. But if you're living in the South, you think, well, why would I care about this? So I think maybe the best way to explain that is why my colleagues and I were so surprised to see these changes. And, you know, we're talking about Great Slave Lake that's in the south. It's around 61 degrees north all the way to Lake Hazen, which is about 81.4 degrees north. So many different degrees of latitude. They also have different degrees of remoteness. Great Slave Lake is home to 60% of the Northwest Territories. Lake Hazen has no community, permanent community there. Great Slave Lake has, you know, 35 fish species. Great Bear Lake has maybe 15. And Lake Hazen has only one fish species. So the food web dynamics are a little bit different. But what we found surprising was the pace and the magnitude, and actually the almost synchronous nature of the changes across all of these lakes. And that really highlights the widespread and powerful shift that climate, this new climate regime has on these lakes, that it kind of just, you know, overrides those differences among the lakes. So, you know, I think we've pushed climate warming to a point now where no lakes are protected. So, for example, Great Bear Lake has always been known as the most unpolluted great lake in the world. And that's certainly true when it comes to things like contaminants and so on. But when we start looking at the microscopic organisms and how things are changing, it's now not no longer untouched by climate warming. So I think the take home message for anyone in the world, whether you're living in Toronto or up north, that no ecosystem is immune to anthropogenic change, and especially not accelerated warming. And that's what we're showing, I think, with our results.

Host: An important message. Kathleen, thank you so much for your time. I really appreciate it.

Kathleen Ruhland: Thank you for having me.

Host: I'm Jeyan. Thanks for watching The Rundown. We'd love to know what you think of the show. So send your suggestions and feedback along to rundown@TVO.org. Or as always, you can leave us a comment on our YouTube page. Until then, I will see you tomorrow.