City of Powell River Council will consider authorizing borrowing of up to $27,280,000 for the city’s proposed liquid waste treatment plant.
At the Wednesday, March 27, finance committee meeting, chief financial officer Adam Langenmaier said the city is working through the process of building a new liquid waste treatment plant. The grant application for federal and provincial funds has been submitted and there is the portion the city has to fund itself.
“We do not have the cash reserves to do it just from a bank account, so we go to borrowing,” said Langenmaier.
The city’s long-term borrowing bylaw is a process and takes time, said Langenmaier. That’s why the finance committee is seeing the loan authorization bylaw now.
The amount that Langenmaier has identified for the loan authorization bylaw is the maximum amount authorized under the city’s liquid waste management plan.
“It exceeds the expected cost the city will bear, but what I wanted to ensure is, if something goes sideways, we have the capacity to borrow,” said Langenmaier. “The goal is it will be lower than this, but that’s why the number is so big.”
The provincial government has to approve this loan authorization bylaw, added Langenmaier.
The matter will be sent to council for its meeting on Thursday, April 4. The recommendation will be: that City of Powell River Liquid Waste Treatment Plant Loan Authorization Bylaw 2551, 2019 be read a first, second and third time and be referred to the Inspector of Municipalities for approval.
The city’s grant application to the federal/provincial infrastructure fund could allocate up to 73.33 per cent of the total liquid waste treatment plant cost, with the remaining 26.67 per cent to be funded by the city through a combination of debt and reserves. Total cost included in the grant application was $79,800,000.
According to a report Langenmaier submitted to the finance committee, the city only needs to borrow what is required to complete the project. Due to the projected size of the loan it is recommended that a 30-year repayment period be used. If the full amount of $27.28 million was borrowed, at an interest rate of 3.2 per cent, the annual debt servicing cost to the city would be $1,446,365.
At the finance committee meeting, city director of infrastructure Tor Birtig said the city is currently working toward design of the liquid waste treatment plant. Council has chosen the natural integration theme design, included reference to a green roof on the administrative building, and a living wall.
Birtig said the consultants are getting close to the final design level so costs can be finalized.
He said the consultants would be coming to Powell River in April and could show some 3D renderings of what is being proposed and the level of design they are working on.
He added he has not heard any information on prospective grant funding from provincial and federal governments.
