Contrary to a long-standing “pay as you go” policy at municipal hall, council is considering going into long-term debt for several large capital projects.
If approved, the municipal debt-load could run as high as the $125 million mark beginning this year.
However, the bulk of that money, $100 million, will be borrowed to build the athletes’ village, with a goal of repaying it within five years as homes in the village are sold to local residents.
Roughly $25 million will finance large capital projects already underway, in conjunction with millions of dollars taken from reserves, or the municipality’s savings program.
While it’s an unusual step for Whistler, it’s par for the course for municipalities elsewhere, explained Diane Mombourquette, the municipality’s general manager of economic viability.
“It’s not unusual for municipalities to finance long term programs that are going to benefit taxpayers in the future,” said Mombourquette.
“It’s actually quite prudent to have a blend of the two (borrowing and using reserves).”
And while she admits it seems like a large amount of borrowing all at one time, even without the unique situation of the athletes’ village, it’s not a lot of money when compared to the municipality’s assets and its considerable borrowing power.
“We have assets over $200 million…” said Mombourquette.
“That’s not a very large debt ($25 million) on such a large amount of assets.”
The assumption of debt, however, comes at a time when Whistler is considering a property tax hike as well as considerable cost cutting measures at municipal hall.
In some respects it’s all a question of unfortunate timing.
Keep in mind, said Mayor Ken Melamed, several projects such as the wastewater treatment plant, the library, and Millennium Place were scheduled to be finished, and paid for, long before now.
“Things are catching up on us,” he said.
In addition, Whistler has not needed to invest in large upgrade projects to its major resort infrastructure until recent years.
The 2010 Games also has an indirect role to play as projects are pushed to completion before the Games.
“Because the Olympics are here there’s a demand to finish certain projects on time,” he said.
“This is a fairly unique period in time.”
It’s also fair to say that the days of paying for things like the Meadow Park Sports Centre in cash are long gone as the town reaches build-out and Whistler transitions to the steady state economy.