The City of North Battleford is applying to the Saskatchewan Municipal Board for an extension to its debt limit, from $31 to $45 million.
The city voted to make the application to the municipal board at their regular June 14 council meeting.
Not surprisingly, the need for a debt financing extension is due to several projects coming up in the near future, including the Credit Union CU Plex.
As explained by finance director Byron Tumbach in a memo to council dated June 10, the debt financing range for that project runs from $5 to $10 million.
"The amount of financing range depends upon the magnitude of the work 小蓝视频 done," Tumbach stated. "If only two of the four components are to be done the financing range is estimated at $5 million. If more components are added the debt required could grow. According to the fund raising committee, some of the contributions are 小蓝视频 pledged over several years. This will require the City to secure more funds at time of construction."
According to Tumbach's report, this will be financed both by the RCCF Levy assessed to North Battleford residents and businesses, as well as donation contracts.
In addition, there are several other expensive projects coming up in the future requiring debt financing. They include sanitary sewer sludge management, with a financing range of $2 to $3 million; Cell 3 landfill expansion from $500,000 to $1 million; water well field development from $1 to $2 million; Industrial park expansion from $750,000 to $1,500,000, and new residential development projects from $750,000 to $1,500,000. The first three are financed by utility charges, the latter two by land sales and service agreements.
This is a far cry from 10 years ago when, according to Tumbach, the city had no debt.
However, that changed after the cryptosporidium crisis that required a number of major infrastructure projects to be built.
At the end of 2009 the city's debt stood at $21,768,981, which was under the limit by almost $10 million.
But ,with both the water treatment plant project ($2.5 million) and the multipurpose project estimated at $10 million, the city would be past the debt limit (to $32,728,125) based on current projects alone.
If future projects are added in, including sanitary sewer sludge management, the landfill, water well field development, industrial park expansion and new residential development projects, the "debt required could exceed $36.6 million by 2012," Tumbach's report stated.
There were three options available. One was to maintain the present debt limit, which would mean major cutting back on projects. The second option was to increase the limit only for those amounts the city needs for current work.
Tumbach recommended the third option: increasing the limit to a level that would provide the city the ability to put together capital plans extending over five years.
He stated the extension of the debt limit to $45 million would be prudent in order to build in "a buffer for unforeseen items facing the city."
The resolution to apply for the debt limit extension to the Saskatchewan Municipal Board carried at executive committee May 25 and then at council unanimously June 14.
