Powell River Regional Hospital District’s committee of the whole is recommending that the hospital board approve the final 2023 budget and 2023 to 2027 financial plan.
At the March 1 regional hospital district meeting, directors received a presentation from qathet Regional District manager of financial services Linda Greenan, who highlighted the budget.
Greenan outlined cost share requests from Vancouver Coastal Health (VCH) to help pay for hospital infrastructure. She said in the 2023 budget, directors would see the balance of the cost share request that was approved in 2021, which was $2.8 million, and the $791,756 approved in 2022.
“Both of those cost share requests were mostly from borrowing,” said Greenan. “There was $118,356 from reserves. Over the year-end we had to use some of the funding from the reserves for one cost-sharing request because the borrowing deadline to draw down from borrowing was December 22 and we received invoices after that date. We had to borrow from reserves to make the budget balance and then we’ll pay those reserves back in 2023 from borrowing.”
Regarding Willingdon Creek Village (WCV), Greenan said there is $1.2 million in lease revenue from VCH in the 2023 budget and debt payments of $1.5 million until 2034. There is a 3.3 per cent interest rate until 2024 on the Willingdon Creek Village loan and in 2024, the debt will renew and will be renewed at a different interest rate, which is uncertain at this time, she added.
The maintenance reserve on WCV has a $240,000 annual contribution to take care of the building envelope, for which the regional hospital district is responsible. That reserve is estimated at $2.27 million at the end of 2023.
The Willingdon Creek Village Reserve fund is forecast to have $4.8 million in it in 2023 and the plans are to use $4 million to pay down the WCV debt in 2024 to mitigate the interest rate risk.
Greenan said in 2023, there will be a requisition increase of $335,000 over 2022, with the total requisition from the regional hospital district and Tla’amin Nation amounting to nearly $1.3 million.
“That is a large change, but in terms of tax dollars, what that means is an increase of about $2.10 per $100,000 of assessed value, so the tax rate per $100,000 will be $14.31 for most residents of the regional district,” said Greenan. “The cost for an average home in the regional district is about $87 per year.”
Greenan said comparing Powell River Regional Hospital District to others around the province, the tax rates are quite low compared to other regional districts.
Electoral Area E director Andrew Fall said he is pleased to see the modest cost of a prospective name change for the hospital district. He said $6,000 and change seems to be not expensive, so he was glad to see that.
Electoral Area D director Sandy McCormick said she is concerned about the interest being paid on the cost-sharing requests with VCH.
“When you add up all the interest charges, it comes out to $762,000 in interest payments that are outlined in the chart from 2023 to 2027,” said McCormick. “That’s a huge amount of money we are expecting our taxpayers to pay on interest on borrowing. I support the budget and I’ll be voting in favour, but, as we move forward, I am very concerned that this number is getting out of control.
“We are being asked to provide additional cost share requests on top of additional cost share requests. It’s going to end up where our budget is nothing but interest payments. I find it very frustrating and hope we can find a solution so we are not expected to incur constant debt.”
The committee voted to send the budget to the regional hospital board for adoption.
