qathet Regional District’s finance committee is recommending the regional board give first reading through adoption to the proposed resource-recovery centre and waste-transfer station security issuing bylaw for $5.5 million.
At the May 3 finance committee meeting, directors were provided a report on the borrowing. The report stated that a temporary borrowing bylaw had been approved for the centre and station on February 25, 2021, which allowed the regional district to draw down on its borrowing for the project. The report stated that the balance of the $5.5 million in temporary borrowing is projected to be drawn down over the next few months.
The report also stated that the budget for payments is based on a risk-adjusted interest rate of six per cent and a 30-year loan amortization period, but the actual interest rate will be determined when the debenture issue is completed by the Municipal Finance Authority of BC in the fall. Therefore, actual payments may differ from what is in the budget.
During question period at the finance committee meeting, manager of financial services Linda Greenan said the borrowing was approved through the inspector of municipalities through a loan authorization bylaw.
“The way that borrowing works in a regional district, the board passes a loan authorization bylaw, they bring it to third reading, the inspector of municipalities approves it, and then the board adopts it,” said Greenan. “That part has already been done. The next step is we do a temporary borrowing bylaw and we draw down on that loan authorization bylaw.
“This is the third step. It allows us to go to the Municipal Finance Authority of BC and say to them we want you to issue long-term debt to us.”
The borrowing bylaw, if passed by the board, will be to have the long-term debt as part of the fall issue of the municipal finance authority. Greenan said the municipal finance authority is currently projecting 20-year debt at 4.65 per cent.
“We are anticipating that the rate might be around our rate,” said Greenan, “but anything could change between now and when the issue happens, which will be around the end of October or into November.”
