Prince George, B.C. –  Prince George City Council has approved some initiatives that should reduce the City’s long term debt.

 

The  Finance and Audit Committee has come up with three initiatives to reduce the amount of money the City spends on carrying long term debt:

 

1. A change in funding sources for a number of capital projects; Seven projects (approved in previous year capital plans) that were to be financed through borrowed funds  have relatively small amounts left to be secured. The Finance and Audit committee says the total amount outstanding  for all 7 projects is just over $900 thousand dollars and that amount can be covered from a reserve for future expenditures. That reserve has a balance of $2.57 million.

 

2. A reduction of debt liability under Loan Authorization Bylaw No.’s 7748, 7922, 7923 and

7924; There are four borrowing bylaws that will be updated as the amounts authorized have either been fully issued, or the full  amount borrowed wasn’t used. By updating the bylaws , about  $5.4 million will be off the books, saving the City about half a million in debt service charges.

 

3. Creation of a debt reduction reserve.

 

The City of Prince George uses long term debenture debt to finance major capital projects for general, sewer and water funds. As of Dec 31, 2008 the actual annual debt servicing cost was $15,258,000 (including Terasen $5,527,623) and the estimated servicing cost on unissued debt was $4,272,480.

 

This represents 66% of the City’s debt capacity.

 

"This is going to have a positive impact on how we pay down our debt" says Councilor Cameron Stolz.