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Clutha District Council manager district assets Jules Witt says the changes to drinking water standards are unlikely to affect the district.
"There's only potentially a smaller amount [of money] available under the new subsidy scheme than the old scheme."
Mr Witt said the council had signed a contract with the Ministry of Health "a couple of years ago" under the old subsidy scheme to help fund the upgrades of four urban water supplies.
Major capital work subsidy-assisted upgrades were under way at Balclutha, Kaitangata and Lawrence, and upgrading the Tapanui supply was nearing completion.
Government subsidies covered nearly $2 million of the $3.77 million cost. The projects were expected to be finished by the middle of next year.
In 2008, the council opened a $4.4 million water-treatment plant in Milton which met the drinking water standards introduced in 2005.
The Milton treatment plant did not require government subsidy, as 75% of the cost was covered by the Department of Corrections, which has the large Otago Corrections Facility near Milton.
Council water services manager Hank Stocker said the Balclutha upgrade was "well advanced" and when the Clutha River was in flood, the town's plant treated the dirty water to an excellent standard.
Clutha District water upgrades
Balclutha: Estimated cost $1.75 million.Received $354,889 from government. Extra operating cost will add about $17 to the water rate.
Kaitangata: Estimated cost $437,900. Received $275,912 from government. Extra operating costs will add about $12 to the water rates.
Lawrence: Estimated cost $835,000. Received $751,680 from government. Extra operating costs will build up to about $42 per unit water rate over the next four years.
Tapanui: Estimated cost $750,000. Received $599,964 from from government. Extra operating costs and a loan-funded local share will add $50to the water rate next year.
Milton: $4.4 million upgrade completed in 2008, with 75% of the cost covered by the Department of Corrections.