by Laura Walz email@example.com City of Powell River councillors passed two resolutions recently that provided details of paying back short-term borrowing for the Timberlane athletic track and the drinking water system upgrade.
The two projects are part of the $30-million capital project initiative that wrapped up at the end of October.
The city is borrowing $299,377 from the Municipal Finance Authority (MFA) for the track and $1,200,572 for the drinking water system upgrade. Both loans, to be paid back in five years, are for the city’s share of the capital projects. Other contributions came from a range of funding sources.
The motions council passed outlined the payments for each of the five years, amounts that include interest. Previously, council passed motions for the Wharf at Westview and south harbour projects. The city will start making payments for all four projects in 2012, for a total of $819,670.
A spreadsheet accompanying this story details the amounts that will be paid back from 2012 to 2016. The amounts are estimates as the exact interest rate won’t be calculated until the city signs loan agreements with MFA.
Debt payments for the Wharf at Westview, south harbour and Timberlane track will come from taxation revenue. Payments for the drinking water system upgrade will come from water fees.
The city also has a commitment to borrow $6 million for the north harbour reconfiguration. The annual payment, which includes principle and interest, is $301,980 over 30 years. Debt payments will come from north harbour user fees, not taxation.
The city’s authorized debt at the end of 2010 was $10,820,832. The estimated annual servicing cost commitment is about $1.1 million.
The Community Charter limits the annual cost of servicing financial liabilities to 25 per cent of revenues from the previous year. According to information from the city’s financial services department, the available annual servicing cost allowed at the end of 2010 was $4.4 million. That is the maximum payment total for all debt, including long- and short-term loans and capital leases.
City of Powell River
Short-term Borrowing for Capital Projects
2012 2013 2014 2015 2016 Total
Wharf at Westview $82,756.00 $80,374.00 $168,992.00 $163,037.00 $151,221.00 $646,380.00
South harbour $411,276.00 $406,191.00 $403,649.00 $401,107.00 $386,647.00 $2,008,870.00
Timberlane track $64,994.75 $63,857.12 $62,719.48 $61,581.85 $60,444.22 $313,597.42
system $260,644.18 $256,082.01 $251,519.83 $246,957.66 $242,395.49 $1,257,599.17
Total $819,670.93 $806,504.13 $886,880.31 $872,683.51 $840,707.71 $4,226,446.59