According to paperwork provided by the City, as of Dec. 31, 2010 the municipality is shouldering a debt worth $19,387,852. Last year it paid $1 million in interest and made $920,510 in principal payments.
The debt breaks down across five borrowing funds. As of Dec. 31, 2010 the debt in the general fund — out of which has funded the majority of the City’s capital projects — was $14,504,019; debt in the water and sewer fund — where monies are collected for water and sewer services annually to be used solely on water and sewer projects — was $3,157,833; there is a borrowed amount in the short-term fund of $350,000 and the City’s reserve fund — to which no interest is applied but money taken out must be repaid within a specified time period — is in the red for $1,376,000.
Spending was accumulated by a number of different council administrations and includes debt accrued by all three mayoral candidates’ councils.
There were five projects approved from the water and sewer fund between the years of 1990-96 when former mayor Walt Cobb was head of the administration. Cobb’s council approved $1,811,043 on water and sewer projects in those six years.
In the term of former mayor Scott Nelson (2005-08) further debt was accrued to the tune of $10, 675, 000. Spending bylaws were approved for projects including: the Clearview Crescent reconstruction, $575,000; the Country Club Boulevard reconstruction, $2.2 million; the River Valley Storm Sewer — phases 1 and 2, $1.4 million (three quarters of the total cost of those projects was covered by senior levels of government); and the fire hall, $6.5 million. Nelson’s council also took $1.3 million out of the City’s reserves to pay for South Lakeside improvements.
Mayor Kerry Cook’s council added a further $3.5 million to the debt for the Mackenzie Avenue rehabilitation project (two thirds of the total $10 million cost of that project was paid by the federal and provincial governments). Her council further borrowed $350,000 from the short-term fund for the Cameron Street reconstruction and, from reserves, $420,000, for garbage and recycling carts. Some of the debts on the City’s books will be paid off as soon as this year and others as late as 2031.
As a percentage of the total debt based on the amount of the original borrowing bylaw: Nelson accrued 48 per cent; Cook, 17 per cent; and Cobb, seven per cent. The City has used 32.4 per cent of its debt servicing capacity based on 2010 revenue. A one per cent tax increase is equivalent to $100,000.
To find out what mayoral candidates have to say about the debt, see page A4.