Kincardine gets failing grade for funding assets

Section: 
News

By Barb McKay

 

Kincardine’s roads may be in relatively good condition, but the municipality is not putting away enough money to maintain them in the future, according to consultants.

 

Representatives from Public Sector Digest, the firm that developed the municipality’s asset management plan, attended last Wednesday’s council meeting to present the plan and make recommendations for looking after roads, bridges and water and sewer infrastructure.

 

According to the plan, Kincardine would need to raise taxes 29.9 per cent over 10 years, or three per cent annually, to generate enough money to replace its assets as needed.

 

Gabe Metron, of Public Sector Digest, said the recommendations in the plan are not set in stone and should be used as guidelines to help the municipality better plan for the future.

 

“Take this as a first step to work with staff to make better decisions and informed decisions,” he said.

 

He added that municipal staff has been keeping good records related to its infrastructure and Kincardine is in a good position compared to some other municipalities. He said the municipality should revisit its policies for funding specific assets every few years, as some infrastructure may last longer than expected.

 

Overall, Kincardine received a B+ grade for the condition of its roads, but an F grade for its ability to pay complete reconstruction in the future, when required. According to the report, the average annual revenue required to maintain the municipality’s paved road network is $2,625,000. Kincardine currently puts away $243,000 each year for future road work.

 

Similarly, Kincardine’s bridges and culverts are mainly in good condition, but more money needs to be placed in reserves to replace them in the future, according to the asset management plan. The municipality currently sets aside $120,000 annually, but roughly $878,000 is needed.

 

The municipality is doing a better job of funding its water and sanitary sewer infrastructure, receiving an overall C grade for each. Consultants indicated that Kincardine should set aside an additional $506,000 annually for its water network and $155,000 annually for its sewer network. One-third of Kincardine’s culverts, catch basins and manhole covers were found to be in poor condition, so another $229,000 is recommended to be added to reserves annually.

 

Deputy mayor Anne Eadie said she believes the municipality is doing a better job of maintaining its roads than what is indicated in the report. She said money is set aside in the budget annually for road projects, such as the Huron Ridge reconstruction project, apart from the money that is placed in reserves.

 

“I’ve driven all over Ontario and I think our roads and bridges are some of the best,” she said.

 

Eadie said the data is based on assumptions, because some roads experience higher volumes of traffic than others.

 

Councillor Jacqueline Faubert said the requirement to have an asset management plan is just another example of provincial downloading, and speculated that consultants are encouraged to give lower grades so municipalities can soothe taxpayers over tax rate hikes to save money for assets.

 

“This is not to promote tax increases,” Metron replied, adding it is a way for the province to get a handle on the requirements to maintain infrastructure, and the federal government is headed in the same direction.

 

Faubert said she is concerned that if the municipality follows all the recommendations in the report and brings its grades up, the province won’t allocate funding.

 

Councillor Ron Coristine pointed out that Kincardine has increased the residential tax rate by nearly 30 per cent in the past four years and now council is being asked to do it again.

 

“I think 1.5 per cent (annually) over 20 years would be a little easier to swallow,” he said.

 

Mayor Larry Kraemer said for the average taxpayer the increase wouldn’t amount to much, but if the municipality doesn’t maintain its roads, damage from pot holes could prove costly.

 

Council deferred accepting the plan and will bring it back to a future meeting for further discussion.