Town council is diving right into the process of borrowing money for a new pool project.
If the town borrows the full $5 million it has committed to the new pool, it could cost the average Athabasca homeowner $77–$85 more per year on their taxes.
At its regular meeting last Tuesday, council decided give the borrowing bylaw its first reading at council’s June 17 meeting.
Councillors Tanu Tyszka-Evans and Nichole Adams voted against the motion, stating that the public should have a say before any decisions around borrowing are made.
“I feel like the public needs to be involved with this project,” Adams said, advocating for a plebiscite to be held before the bylaw is brought forward.
Tyszka-Evans said the money would take up over half of the town’s borrowing limit and the citizens should be able to have their say.
“I think it’s important to give the public a voice,” he told council.
Mayor Roger Morrill was supportive of the idea of a plebiscite early in the meeting, but later decided the expense would be a waste of money, after an explanation from chief administrative officer Ryan Maier.
“I do think the thoughts of our community are important, and I think we have to let them speak as quickly as possible in this process,” Morrill said.
However, he recognized that a plebiscite is a non-binding vote, and if a petition were to follow, the plebiscite would be meaningless, as explained by Maier.
“If we do a plebiscite, there’s nothing about it that’s binding, and there’s nothing about it that then prevents a petition (against) a borrowing bylaw. So essentially, we could take that time and cost of the plebiscite, and if we’re fairly certain there is going to be a petition, we know it’s going to be voted on anyway,” Maier said.
Estimates put the cost of a plebiscite in the couple-thousand-dollar range.
“When we’re talking about a $5-million project, I don’t think a few thousand dollars to see how our community feels is an extravagant expense,” Adams said, stating her wishes to have an open house, followed by a plebiscite to gain public input.
Councillor Shelly Gurba explained the public does need to be involved, but it will be better to bring them in when there is more information available and all the parties involved with the project are together.
“If you have one big consultation, I think that will go over much better with the community,” Gurba said, speaking of the fact that the pool is being planned in conjunction with Athabasca’s new secondary school and will also be funded by Athabasca County.
Maier explained that council needed to get the ball rolling on the pool project as it needs to let its partners on the steering committee for the new school know where town council stands.
“If we’re not borrowing this $5 million, I’m suspecting we’re not going to be able to move forward with the pool project, and so the people doing the school project will need to know that in due time,” he said.
Currently, the town of Athabasca has $4.9 million in capital reserves; $3.2 million of those reserves could be used towards the pool project if council wishes to do so.
When it comes to borrowing, the town currently has approximately $7.9 million in borrowing capacity, and as of the end of 2013, is holding about $1.7 million in debt.
If the town were to borrow the total $5 million for the project, it could add between $114,000 and $211,000 annually to the town’s debt load based on 20- or 30-year repayment terms respectively. Without major changes to the current budget, this could lead to a 4- to 6-per-cent increase to the town’s mill rate.
“I think it’s important to get the process rolling so we know where we stand and what this community wants to do within the next few months,” Morrill said.
Adams stated that because the pool and the school projects are linked, the pool project is being rushed.
“What’s happening here is because the school came along, they are rushing everything. I feel a lot of times when you rush large projects like this, we end up regretting it later.
“I’m not completely against it. I think it’s a decision that the people have to make. I don’t like it when politicians make decisions this big, when they have the option to ask the people,” Adams said.
Tyszka-Evans said he’s not completely against a new pool either, but explained there are more pressing infrastructure projects the town should be spending its money on.
“There are projects that just keep getting pushed down the line to make room for fun and games. I don’t think that’s how the town should be run,” he said.
Morrill explained that the public will have a chance to speak as he is certain a petition will be circulating after the first reading of the bylaw. A valid petition with 299 signatures will force the borrowing bylaw to a vote in which all residents may participate. Council is bound by the decision of that vote.
“With as much controversy surrounding the borrowing for the swimming pool, I’m quite certain there will be a petition coming forward on this one,” Morrill said. “This is just to cover the fact that we are willing to be willing participants in this. I think it’s very important that before things go down the path much further that the citizens of Athabasca have their say and decide whether they wish to borrow this type of funding toward this project.”
The Municipal Government Act states that councils must have a detailed estimate for a project before they are allowed to borrow money for it and that the money “must be used for the purpose for which it is borrowed.”
Maier explained this is a flaw in the MGA and causes many problems for municipalities.
“It’s a chicken and egg thing ... if we went out and tendered it ... to get that detailed estimate … and then go do the borrowing bylaw and the borrowing bylaw fails, we’re really hooped, right? We’ve tendered a contract on a project that we don’t have the money to do,” he said.
The problem is further exasperated by the fact that if the project cost comes in at 15 per-cent higher than what was originally estimated, the town must repeat the borrowing bylaw process again.
“What happens to a lot of municipalities is they end up having to go back to the drawing board and do the borrowing bylaw again because the costs are 15 per cent over the original,” Maier said.
After the borrowing bylaw’s first reading on June 17, there will be a two-week advertising period and a 15-day petition period before the bylaw receives further readings.
