Council divided over funding Tiverton community centre, servicing business park, or neither



By Barb McKay


Prioritizing infrastructure projects has become a significant challenge in setting the 2018 Municipality of Kincardine budget.


During its budget meeting last Wednesday, council spent two hours discussing which projects should move forward this year and which ones can be put off to the future. Facing an election in October, councillors are under pressure to make the right decisions, but with limited funds they must choose between infrastructure projects that will benefit constituents now and ones that will help the municipality grow.


Council started off its second round of deliberations with a proposed residential tax rate increase of 3.1 per cent. The rate increased from 2.65 per cent, proposed at the first meeting, mainly due to changes to the provincial education tax rate. Treasurer Roxana Baumann said the municipality has the ability to borrow some funds for capital projects, but should be cautious about borrowing too much or it would be forced to raise the tax rate for a number of years to pay back the loans.


While a number of capital projects, including upgrades to the Connaught Park pumping station, Broadway Street reconstruction, Kincardine tennis courts refurbishment, repairs at the Kincardine water treatment plant and a new columbarium at the Kincardine cemetery, will move forward for final approval, council is still considering how or if it will fund two large projects.


One of those projects is the development of a new 11,000-square-foot community centre in Tiverton, which would house the Tiverton public library and provide space for a warming centre. The project has been included in municipal budget discussions since 2014 and the building design has changed to reduce the cost, which is now estimated at $4.7 million.


Council is also looking at extending municipal services to the Kincardine business park at Highways 9 and 21. The project would be carried out in phases, beginning with upgrading the water and sewer services on Russell Street from Scott Street to Highway 21 at a cost of approximately $1 million. The total cost of the project is expected to be $11.6 million.


The Bruce Power Major Component Replacement (MCR) project is changing priorities in the municipality as companies moving into the area to support the project are looking for office space and land. During last week’s meeting, council gave the go ahead to extend water and sewer services to the Ontario Peninsula Farms land behind the Sutton Park plaza not only to accommodate a Bruce Power training centre but also to allow for future development. There is no funding available in the budget for the $4.2 million project which means the municipality will be taking on debt.


Increasing the municipal debt load limits the number of new projects the municipality can handle and last week council was not of one mind when it came to deciding which project should be a priority.


Councillor Randy Roppel said the municipality won’t know the true cost to replace the Whitney Crawford Community Centre in Tiverton until it puts the project out to tender.


“We’ve made a promise to the people and we’re in an election year,” he said. “Put the thing out to tender and let’s find out. We’ve put time and money into this to get drawings down.”


“I, too, would like to put this to rest,” Mayor Anne Eadie said. “The interest rates are starting to rise and the cost will never be lower. Community fundraising will help us out and we can sell the old library.”


Recreation director Karen Kieffer provided a cost analysis for the municipality to operate the new community centre at the request of council. She said the municipality could expect annual revenues of approximately $20,000 and expenses of approximately $130,000, based on cost comparisons from the Underwood community centre and the Kincardine Centre for the Arts.


Baumann said staff looked at two borrowing options to finance the Tiverton community centre. The municipality could borrow over a 10-year term through Infrastructure Ontario, which would require an annual payment of $544,000. Under that scenario, the municipality would need to raise the residential tax rate by 4.18 per cent annually for the term of the loan. She said the borrowing period could be extended to 20 years with annual payments of $320,000, but it would increase interest fees by $953,000.


Eadie said the municipality could try for government grants for the project. She also suggested that instead of using the anticipated $500,000 Bruce Telecom dividend this year to start a municipal fleet replacement reserve fund, some of that money could be put in the reserve fund for the landfill cell expansion at the Kincardine waste management centre. The Armow Wind community benefit fund money that was to go to that project could then be used for the Tiverton community centre.


Councillor Maureen Couture asked if Eadie was suggesting that the annual community benefit fund be allocated to the community centre project for the next 10 years. Armow Wind has agreed to provide $640,000 annually for the next 17 years.


“Someone said last year, ‘what’s wrong with putting it towards a big project?’ It’s a community project,” Eadie replied.


Councillor Laura Haight said council should look at all the priority projects before singling out one for funding.


“I’m not opposed to the project, but I think we have to look at what our needs are now.”


She said that if the business park land is serviced and ready for development the municipality will bring in revenue through development fees and commercial taxes.


Councillor Gord Campbell agreed.


“I don’t think we can forget about 9 and 21,” he said. “Other revenue will come in in time, I do agree with Laura.”


Councillor Maureen Couture said council needs to look at the future and put funding that does not come from the tax base into infrastructure.


“Infrastructure is important or all development is going to go somewhere else,” she said.


Roppel said he would like to see a report, compiled by Hemson Consulting on the business park servicing project, to understand the project cost and the cost recovery plan. He said council needs to show the public that there will be a return on the municipality’s investment.


“We talk about a return on their investment, but when you look at facilities, by their very nature, they don’t make money,” Haight said.


She said companies will not purchase land that is not serviced.


“You extend services to areas that you want to grow and now is absolutely the time to do it.”


Public Works Director Adam Weishar said after services are upgraded on Russell Street, the next phase of the project would be to extend Durham Street to Highway 9 ($1.8 million), add sewer lines ($300,000) and stormwater management ($670,000). A booster pump at an estimated cost of $900,000 may be needed as land is developed.


Council will discuss the projects further during its next budget meeting on Jan. 29. Also on the agenda are a number of community projects, including facilities at the Bruce Avenue soccer fields, the Stonehaven Community Park, the Inverhuron Pavilion and renovations to the Kincardine Centre for the Arts. Some councillors made a pitch to give those projects further consideration.


“Stonehaven has raised most of the money for that project,” Councillor Linda McKee said. “I would feel bad if we didn’t fit them in now because they have worked damn hard.”


Council also decided during last week’s meeting that it would not defer the fleet replacement reserve fund to next year. Weishar said his department alone has 50 pieces of equipment and the average age is 10 years. Public works exceeded its operating and maintenance budget for this year mainly due to the aging fleet.