View Royal residents will go to referendum Nov. 24 and now they’ll know the terms of the loan for a proposed new fire hall.
Of four options brought forward by municipal staff at a recent meeting, council followed staff’s recommendation to seek a 20 year loan at an estimated interest rate of 3.5 per cent. That rate is based on current interest rates, which could change by spring 2013, when the town would actually take out the loan.
A loan of $5,490,000 is projected to cost $3,843,000 in interest over the 20 years. Of that $1.8 million will be repaid through actuarial funds generated by investments made by the Municipal Finance Authority of B.C., the agency issuing the loan, estimated to be at a rate of four per cent.
The total amount to be paid back by the town is estimated to be $7,530,276.
Annual payments of the loan would amount to $376,514. Of that, $27,000 would come from non-residents, namely First Nations communities, with the rest to be paid by View Royal residents.
For an average single-family residence this would amount to a property tax increase of $85 per year, or $7 per month, for a 6.7 per cent increase to taxation. The cost to businesses would be an estimated average $648 per year.
Borrowing money through the Municipal Finance Authority means lower interest rates for the town, Mayor Graham Hill said.
Should council have chosen a 25-year loan it would have cost the town an estimated additional $569,116 in interest.
“We expect this building to service our community up to 50 years,” chief administrative officer Kim Adema said at the meeting. “So it wouldn’t be unheard of to try to match that term with the cost so that those that are benefitting are actually paying for the building. However, that conflicts with optimizing the scenario in terms of the tax bill and interest bill.”
Council also passed a motion to bring the procedure bylaw for petitions and delegations to the next committee meeting for review. This is in response to members of the public using the platform to raise questions over the fire hall in ways some councillors object to.
“I really do feel it is almost being made a mockery of,” said Coun. David Screech. “It has been a venue for people to bring new information to council and it’s not a political forum for people to get up and make the same point over and over and over again at meetings.”