posting
03-05-2007, 10:01 PM
February 27, 2007
Bill Glover on LVEC cost increases: “the well has run dry”.
City reserves hit hard.
-- Bill Glover, www.billglover.org
Of the $4,345,000 budget increase for the LVEC, $3,345,000 will come from City reserves, in other words, tax revenues from previous years. That doubles the draw on our reserves, as the original LVEC budget called for $3,450,000 from reserves, and additionally $3 million from development charges.
In addition to the financial cost to taxpayers, there is an opportunity cost - the other infrastructure work that will not be done. For example, the Third Avenue sidewalk was the topic of a recent press story, and one resident e-mailed me about road problems in Bayridge that are not being resolved because of a lack of money.
LVEC cost overruns will have a major impact on our available debt; City’s credit rating could “deteriorate”.
Over the past week or ten days many have said, words to the effect, “it is only 10%,” “all projects go over budget” and “build it even if it costs $70 million.” Those opinions bother me.
The cost increase represents a 10.4% hike in the project’s approved budget in a few short months and almost 15 percent of Kingston’s available civic debt room.
The Standard and Poors credit rating of the City of Kingston indicated that the completion of the outstanding capital projects “is expected to fully use the City’s resources in the coming years, limiting financial flexibility” and “notable cost increases in the larger projects planned, the undertaking of additional, large medium-term projects, or both, could set the City’s credit profile on a deteriorating path.”
Our other capital projects include:
• completing the Multiplex
• completing the Grand Theatre
• the Memorial Centre
• possible purchase at full market price from the federal government of the Marine Museum site, and the waterlots, without which we could not control our waterfront
• Ravensview
and we have not even yet formed the Mayor’s task force on poverty, and addressed the issues of affordable housing. What capital investment do we want to make there ?
Given the numbers and best available information now provided by staff, I believe that continuing the LVEC project is the best use of taxpayers’ money.
The well has run dry.
HOWEVER, the well has run dry. Our reserves have been drawn down by almost $7 million dollars to fund the LVEC; our debt capacity is not unlimited and we have other capital projects to fund and manage.
No more cost increases to be shouldered by taxpayers.
We cannot have any more calls for budget increases funded by the taxpayer.
With naming rights being sold separately, now is the time for real philanthropy.
This Council must take as a priority setting guidelines for fundraising so the unfortunate experience of the City’s Market Square is never repeated.
City Council cannot ignore the needs of those who will not or are unable to use the LVEC.
Other funding alternatives must be found not just to guard against future demands on the pubic purse which I will not support, but to relieve the strain being put on it now.
Bill Glover on LVEC cost increases: “the well has run dry”.
City reserves hit hard.
-- Bill Glover, www.billglover.org
Of the $4,345,000 budget increase for the LVEC, $3,345,000 will come from City reserves, in other words, tax revenues from previous years. That doubles the draw on our reserves, as the original LVEC budget called for $3,450,000 from reserves, and additionally $3 million from development charges.
In addition to the financial cost to taxpayers, there is an opportunity cost - the other infrastructure work that will not be done. For example, the Third Avenue sidewalk was the topic of a recent press story, and one resident e-mailed me about road problems in Bayridge that are not being resolved because of a lack of money.
LVEC cost overruns will have a major impact on our available debt; City’s credit rating could “deteriorate”.
Over the past week or ten days many have said, words to the effect, “it is only 10%,” “all projects go over budget” and “build it even if it costs $70 million.” Those opinions bother me.
The cost increase represents a 10.4% hike in the project’s approved budget in a few short months and almost 15 percent of Kingston’s available civic debt room.
The Standard and Poors credit rating of the City of Kingston indicated that the completion of the outstanding capital projects “is expected to fully use the City’s resources in the coming years, limiting financial flexibility” and “notable cost increases in the larger projects planned, the undertaking of additional, large medium-term projects, or both, could set the City’s credit profile on a deteriorating path.”
Our other capital projects include:
• completing the Multiplex
• completing the Grand Theatre
• the Memorial Centre
• possible purchase at full market price from the federal government of the Marine Museum site, and the waterlots, without which we could not control our waterfront
• Ravensview
and we have not even yet formed the Mayor’s task force on poverty, and addressed the issues of affordable housing. What capital investment do we want to make there ?
Given the numbers and best available information now provided by staff, I believe that continuing the LVEC project is the best use of taxpayers’ money.
The well has run dry.
HOWEVER, the well has run dry. Our reserves have been drawn down by almost $7 million dollars to fund the LVEC; our debt capacity is not unlimited and we have other capital projects to fund and manage.
No more cost increases to be shouldered by taxpayers.
We cannot have any more calls for budget increases funded by the taxpayer.
With naming rights being sold separately, now is the time for real philanthropy.
This Council must take as a priority setting guidelines for fundraising so the unfortunate experience of the City’s Market Square is never repeated.
City Council cannot ignore the needs of those who will not or are unable to use the LVEC.
Other funding alternatives must be found not just to guard against future demands on the pubic purse which I will not support, but to relieve the strain being put on it now.