Initially published in the Alliston Herald on January 30, 2009
The good, the bad, and the ugly? Not quite. This week it's all ugly.
Ugly No. 1: The Town of New Tecumseth has one monstrous whack of debt. For starters there is the $17.2 million presently on the books. The total does not include the additional $3.5 million that is already factored into the 2009 draft budget. For those who are counting, we're at $20.7 million.
Another $23.0 million of debt (drawn upon a $36.0 million line of credit) needs to be added to the total for the wastewater treatment expansion facility. The tally: $43.7 million.
Further, although no one at the town level seems to be talking about it, New Tecumseth has enormous obligations associated with the Georgian Bay water pipeline - a debt that presently sits in the neighbourhood of $31 million. Not a single payment (interest or principal) has been made to the province since the pipeline was constructed and massive interest continues to accumulate. A balloon payment will become due a few years from now. By that time, in the absence of some form of bailout, the pipeline debt will hover around $40 million or more. For now, let's keep it at $31 million. The tally: $74.7 million.
If the remaining $13 million is drawn on the wastewater line of credit (and there is little reason to believe it will not), the total will be $87.7 million!
What's particularly worrisome (beyond the staggering interest obligations) is that the town's borrowing capacity for the next 10 years (assuming the 2009 budget is approved) is a meagre $7.0 million. If Beeton councillor Richard Norcross gets his way (and he usually does) we can expect another $5 million or so of debt financing for the new Beeton arena. The projected total thus becomes $92.7 million.
New development in this community has largely ground to a halt in no small part due to the high development charges. Consequently, any suggestion that new development charges will "save us" are not based in reality.
This miserable debt position is in part due to a series of bad deals and a penchant by town council, both past and present, to use taxpayer funds for projects ($1 million or so for medical offices; several hundred thousand to construct a restaurant at the new arena; $600,000 to acquire the Banting Homestead etc.) that ought to have been left to the private sector.
The Ugly No. 2: Last week, in a decision made in camera, town staff agreed to take a "hit" in the form of four unpaid days off in 2009. This kind gesture will save New Tecumseth taxpayers approximately $150,000.
Based on my observation of senior staff as they left the meeting I can assure you the decision was not unanimous.
Imagine how annoying it must therefore have been for these individuals, a few minutes later, to see some councillors lead the charge to increase the town's commitment for the construction of the Mel Mitchell fieldhouse from $50,000 to $200,000.
This is especially the case in circumstances where the field house project has morphed from a plan to construct washroom facilities into a much more elaborate project complete with a wrap-around porch where residents can observe the fields while they consume cucumber sandwiches with no crust (as suggested by councillor Jamie Smith).
The Ugly No. 3: At the same in-camera meeting council gave staff direction to investigate the possibility that the town assume the operation of the town's libraries in place of the New Tecumseth Library Board - the independent entity that is actually responsible for the operation of the libraries in our community.
The action was taken without the knowledge or direction of the Library Board (of which I am a member) and represents an outrageous and extremely offensive blindside.
Quite frankly, there was no justification for this direction to have been given in secret and behind closed doors. What I find particularly disturbing is that the two members of town council who sit on the library board were present at the in-camera meeting and voiced no objection to the direction.
The board has operated the library for many, many years in a competent and efficient manner. There is no reason for it to be pushed aside in response to a bizarre and inexplicable power grab. In fact, it is with some bemusement and irony that I point out the library board has managed to operate for many years without incurring millions of dollars of debt.
Given the debt position of the town, do you really want to give council responsibility for the libraries!
