Coun. Morgan Nagel was the single vote opposed to the spring budget adjustments of $1.745 million in the capital budget, offset by $465,000 in provincial grants and $1.285 million in reserves.
The operating budget adjustments amounted to $354,888, offset by provincial grants for transit.
All transit dollars have been combined to a single budget for transit – with the aim to have buses for a local transit service operational by the fall of 2018.
The transit expenditures for this year are $686,085 with offsetting revenues of $447,768, resulting in a net cost of operations of $238, 317 (as approved last December).
The result is a zero increase in 2017 property taxes.
Nagel’s naysay vote was in regards to the $740,000 adjustment to demolish the Big Hill Leisure Pool site, noting that he would like to at least see costing options for the renovation of the facility for another use.
Mayor Ivan Brooker and remaining councillors opted to move forward with the approval to demolish the site, noting that it was likely that the cost to renovate the facility would be too high – with ballpark estimates based on similar facility renovations in other communities topping $1 million.
Other capital adjustments include $500,000 for the town’s Dark Fibre strategy; $465,000 for increased road rehabilitation; $40,000 for parks projects for fencing at the Fireside and Sunset schools and the GlenEagles baseball diamond.
Included in operations budget adjustments is $70,000 to fund a downtown parking strategy and $50,000 for an RCMP detachment administrative position; both are funded through reserve dollars.
Bridge Borrowing
Council deferred first reading for early borrowing for the bridge project, directing administration to return with more information on why early borrowing makes better financial sense.
The proposed strategy would result in a cost of $550,000 per year in principal and interest payments on the $8 million borrowing at three per cent, those payments will be made using grants, reserves and offsite levies with no impact on property taxes; the loan is calculated on a 20-year term. Interest in the first two years would be $470,000.
According to Paige Milner, senior manager of corporate services for the town, the fiscal strategy is centered on securing a low interest rate and ensuring property taxes are not raised in the interim.
“We recommended borrowing $8 million of that now as a financing strategy to take advantage of record low interest rates and to keep some offsite levies in the bank just in case levies collected in one year are not enough to cover the principal and interest loan payments,” she explained, adding that she will return in July with further information, as requested by council.
If the town chooses to move forward with this strategy, it would increase the town’s total debt to $31.3 million – 52 per cent of the council-approved debt limit and 42 per cent of the Municipal Government Act limit.
Councillors were advised by Milner that “we will have to borrow, no matter what” but questioned whether or not early borrowing was necessary, if it could play out that interest paid out exceeds interest earned on money that would not be needed until 2019/2020 – depending on the timeline of the bridge.
The bridge is estimated to cost $53.5 million with 68 per cent funded from offsite levies and 32 per cent from the town. There is currently enough offsite levies cash in the bank to fund north arterial road bridge connection at a cost of $9.5 million; to date $15.3 million has been approved in the town’s capital budget for the bridge.
Coun. Jeff Toews – a mortgage broker by day – said he would be interested to see what shorter-term borrowing would look like if it meant that the interest could be pared down lower than three per cent; he applauded administration’s approach to take advantage of “record-low interest rates.”
Coun. Morgan Nagel prefers a “more conservative approach” and would lean toward a long-term borrowing strategy so that financial pressures do not become too cumbersome - given the town’s recent borrowing of $19 million for the pool, to be repaid by the end of 2019.
