Try to Read Between the Lines
By 250 News
Tuesday, October 25, 2005 03:34 PM
Today, the report on the City's debt was to be delivered.
Well, Opinion250 has a copy and here it is:
"In 2004 with the implementation of the Community Charter the method of calculating the limits on borrowing and other liabilities of a municipality and the process to acquire financing through MFA changed. (Under the Municipal Act the borrowing limit was based on assessed land value.)
The Community Charter requires that borrowing capacity be calculated on the basis of ability to service the debt. As of the end of 2004 the City had a total servicing cost of 11.2 million and a total servicing capacity of 22.9 million, thus having an available servicing capacity of 11.7 million. This capacity is the equivalent of $129.5 million in additional debt (based on 20 year debt at 6%).
In 2005 the city has borrowed as required to fund the capital programs. The current servicing cost is $13.9 million with a remaining servicing capacity of $9 million. This is the equivalent of being able to finance $100 million in additional debt (based on 20 year debt at 6%). "
The report was submitted by Manager Financial Services, Sandy Stibrany. It does not answer the basic question which was posed by Councilor Brian Skakun at the last Council meeting. At that time, he asked "How much does the City owe? " and "What is our borrowing limit?"
The questions were posed as the City was passing bylaws which clear the way to borrow more than $27 million dollars.
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Posted by: Palopu on October 25 2005 4:31 PM