One of the recommendations of Justice O'Connor's Part II Walkerton Report was that a Municipal Drinking Water licence Program be developed and implemented and that as a part of such a program the owners and operating authorities implement a quality management approach to operations and maintenance. The draft Financial Plans Regulation loaded on the Environmental Bill of Rights Registry on May 4, 2007 for a 35 day comment, is intended to assist in the implementation of the quality management approach.

The draft Financial Plans Regulation defines the requirements for Financial Plans for municipal drinking-water systems that are required as part of the application process for a drinking-water licence under Part V of the Safe Drinking Water Act, 2002. The proposed Regulation prescribes different requirements for existing systems and new systems. For existing systems, Financial Plans must be developed for a six (6) year period and must contain details of a system's financial position, financial operations and cash flow. The Financial Plans must be approved by the owner and must be updated with every application to renew the licence.

For new systems, the Regulation proposes to require the owner to declare, in a form of a resolution, that the financial impacts for the proposed system have been considered and that it is financially viable. Under new municipal accounting standards, municipalities will have to adopt full accrual accounting practises beginning January 1, 2009.

The Regulation proposes to require the first set of Financial Plans for existing system through a condition imposed on the first drinking-water licence. The Regulation will require submission of Financial Plans for existing systems following July 1, 2010 or six (6) months after the drinking-water licence is issued (whichever date is later). A Financial Plans Guideline has been developed to assist the municipalities in meeting their obligation under this Regulation. Part II of the Guideline introduces a number of possible approaches to implementing long-term capital planning, asset management and other principles to support financially sustainable drinking-water and waste water systems.