Restraint on Capital Projects

Council’s Finance, Administration and Corporate Services (FACS) Committee met today. 

The committee (Councillors Karl Wettstein (chair), Ian Findlay, June Hofland, Bob Bell and I) received a report that will lead to significant changes in the City’s capital budget spending program should it be supported by City Council on July 28th.

First, the committee is recommending that the burden on taxpayers for capital projects be reduced by more than $40 million over the next 5 years.  This will be achieved by:

  • eliminating, revising or deferring some projects
  • building reserves (savings) so we have the money in the bank when we need to fix our infrastructure
  • managing our debt so that today’s taxpayer doesn’t shoulder all the burden of new growth
  • maximizing external sources of funding (e.g. federal and government funding programs, development charges)

Second, and for the first time, an upper limit will be set on the amount of debt that the City can carry.  Provincial legislation does not permit a municipality to commit more than 25% of net revenue fund revenues to paying for debt.  The FACS Committee is recommending that the City set a  more conservative limit of less than 10%.

Council establishes priorities and allocates resources to capital projects which will make a signficant difference in the quality of life of our community including:

  • infrastructure renewal and rehabilitation (e.g. Eramosa Road bridge repair)
  • recreational and cultural facilities (e.g. South End Community Centre)
  • economic development (e.g. Hanlon Creek Business Park)
  • environment and waste management (e.g. new organics facility)
  • affordable and social housing (e.g. youth shelter)

These investments in our community address:

  •  the renewal of city assets (e.g. water distribution infrastructure)
  • growth (e.g. South End Emergency Services Facility) 
  • strategic initiatives (e.g. new main library)

Council recently supported another recommendation from the FACS committee that will limit the amount of your tax dollars that can be spent in any one year on capital projects to 20% of the budget.  This decision drove the need to re-evaluate the 10-year capital budget and forecast. 

This new policy will be in place before the 2009 budget process.  The 10-year capital budget and forecast will come forward for approval as usual during the annual budget process later in the year.

 

 

 

 

About Karen Farbridge

An unwavering change maker seeking a just, democratic and sustainable world.

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