Invermere council officially approved, at its most recent council meeting, to borrow the $5.6 million dollars needed to build the new multi-use centre from the Municipal Finance Authority of B.C.
The move had been approved by Invermere voters in a referendum in fall 2013, but it was not until the July 14th council meeting last week that council formally approved the exact terms of the loan, which will be for a 25-year term and carry an interest rate of 2.78 per cent.
The loan will be for the finance authority’s 2015 borrowing session and will result in annual parcel taxes of about $110 per home in Invermere.
District staff recommended to council a 20-year borrowing term, which would put the annual parcel tax at $130 per home, but result in much less interest being paid over the total life of the loan.
Council also considered a 30-year borrowing term, which would put the annual parcel tax at about $95 per home, but result in much more interest being paid over the life of the loan.
“I hate paying interest. I always like to pay off debt early. But 2.78 per cent locked in for 30 years, that’s a mortgage payer’s dream,” said councillor Justin Atterbury.
Councillor Paul Denchuck was not initially convinced, preferring the 20-year borrowing term and saying, “I’m of the belief that you should be aggressive with your debt to save the cash.”
Invermere mayor Gerry Taft suggest a compromise of a 25-year term, saying it would be less of a shock initially (in terms of the parcel tax) and noting that there was an option to get out of the 25-year term loan early — at 20 years — if the district has the cash on hand to pay out the loan then.
“It’s hard to strike a balance of how much you tax current residents now for the benefit of future residents,” said Taft.
In the end council members unanimously voted to approve the 25-year borrowing term.
Province explains Jumbo mountain resort municipality
Council received a letter from the Ministry of Community, Sport and Cultural Development in response to the motion pertaining to Jumbo Glacier Mountain Resort Municipality put forward by Taft and then endorsed by the Union of British Columbia Municipalities (UBCM) delegates during the 2014 UBCM meeting, saying that the UBCM was strongly opposed to the funding of municipalities
The ministry wrote back (to the UBCM, which then passed the communication on to the Invermere council) that “the provincial grant (for Jumbo Glacier Mountain Resort Municipality) enables the (Jumbo) council to have a degree of independence from the proponent as it develops a planning and regulatory framework for the development of the resort. The Local Government Grants Act makes the mountain resort municipality eligible for a Small Community Grant. Regulation 332/95 under the Act determines the amount of money to which the mountain resort municipality is entitled, which this year was $200,000 in 2014.”
“It doesn’t look like the province agrees with us,” said Taft.
Councillor Paul Denchuk said he was glad to see the letter reference a degree of separation between the province and the proponent with the Jumbo project.