City to borrow $2.62 million for capital projects
Councillor: City is ‘heading for disaster’ and mortgaging our children’s future with excessive borrowing
Coun. Tony Scarcella again railed against runaway spending at city hall, this time in response to city plans to borrow $2.62 million for five capital projects.
“We’re heading for disaster. Our taxes will be so high that we won’t [be able to] afford to live in Revelstoke,” Scarcella told council, adding the city was effectively mortgaging the future of its younger residents.
Scarcella’s comments came about during the first readings of borrowing bylaws for five projects. The plans are to borrow:
- $300,000 to repair the Revelstoke Courthouse roof
- $620,000 for roadwork, including repairs to Powerhouse Road and other streets.
- $1 million to replace the Downie force main
- $500,000 to desludge one of two lagoons at the sewage treatment plant
- $200,000 to repair the Revelstoke Community Centre roof
A report from CAO Tim Palmer notes the projects will add $1.12 million in new general debt to the existing $10,222,929 in existing general debt, for a total of $11,342,929. The new borrowing will increase interest and principal repayments by an extra $90,000 annually.
Sewer debt will increase by $1.5 million. This will be added to the existing $5,366,898 in sewer debt for a new total of $6,866,898. New interest payments will amount to $120,000 for sewer debt.
The borrowing means the city will pay an extra $210,000 annually in principal and interest payments, Palmer’s report states.
In his report, Palmer also notes that borrowing for these types of capital projects in problematic. “These are all important projects; however we need to ensure that future capital priorities are financed in a sustainable way,” he writes.
Palmer also notes that a recent city strategic planning process had explored priorities for 2012. The process including planning for projects “within the community’s financial limits,” Palmer wrote. “We are fortunate that interest rates are very attractive at this time.”
The city’s strategic plan is scheduled to be unveiled at a June 21 committee meeting.