Councillor opposes formula

Lachlan Labere - Salmon Arm Observer Published: March 24, 2009 6:00 PM

The Columbia Shuswap Regional District will have to look at long-term borrowing to fund its new government offices after receiving heated criticism from a municipal member unhappy with previously proposed reserves. In his introduction to the 2009 five- year financial plan presented to the board last week, CSRD financial and corporate services manager Ted Holmes said it was the most difficult budget of his career. Holmes’ budget troubles weren’t over yet, particularly when he described his concerns regarding a sharp increase in general government expenses, owed largely to the regional government’s need for a new central office building. Holmes explained he received direction from the board last year to provide money in the budget to finance the new facility.

“We got very creative in that meeting and came up with a plan to do it over five years, $500,000 a year into reserve, and at the end of that time we short-term borrow the balance,” said Holmes, who then apologized to the board, stating he’d shelved that plan because he didn’t want to hit taxpayers with the $500,000. “And I believe we got a resolution from the City of Salmon Arm, saying ‘take the City of Salmon Arm right out of the budget,’” said Holmes. “I turned the paper over and I didn’t see any solutions to our staffing problems. I didn’t see any solutions at all. All I saw was take the money out, and I don’t agree with it and that’s personal, I do whatever the board tells me.”

There’s currently $543,426 in a reserve for the new building. In summary of a new building financial plan, Holmes has lowered the 2009 contribution to $350,000, with the contribution gradually increasing over the coming years to $675,000 in 2013. Salmon Arm director Kevin Flynn said he recognizes the regional district needs a new building. But he adamantly opposed the allocation formula, which he argued has member municipalities like Salmon Arm providing about 50 per cent of the reserve budget. “The fact is, you’re increasing general government significantly and not making any change to the administrative chargebacks, and that’s fundamentally unfair and wrong. And until that’s corrected, I don’t think we should be putting anything more into this reserve ...,” said Flynn.

Furthermore, Flynn said he was philosophically opposed to the five years of significant reserve contributions and the short-term borrowing plan. “You said that Salmon Arm didn’t have a solution – It’s not Salmon Arm’s job to come up with a solution,” said Flynn. “But Salmon Arm does not feel the building should be funded over 10 years… it should be long-term borrowing, just like we funded our building and just like the hospitals are funding their buildings.”

Flynn recommended an amendment to remove this year’s $350,000 reserve contribution from the budget, but Revelstoke-Columbia director Lonnie Parker said she was uncomfortable with the board revisiting the matter in the 11th hour. “I think what’s happening here is that, due to the economy and the state of our communities, there’s a political shift here to do whatever we can to reduce the taxes, regardless of however that will hurt us in the future,” she said. In response to comments that the amendment would derail plans for the building, board chair Marty Bootsma said this wouldn’t be the case, and that the CSRD would have to look at long-term borrowing. Flynn then recommended the board look to long-term borrowing, stating it’s a matter of being responsible with taxpayers’ money. “I think the issue is there’s a political reluctance to leave this decision up to the taxpayers and use either counter-petition or referendum,” said Flynn.

“Instead of doing that, we’re going to ram this through and do it on short-term borrowing and set up reserves with an unfair and very old and not recently reviewed allocation formula…” The board approved the amendment, with Parker, Sicamous-Malakwa director Rhona Martin and Falkland-Salmon Valley director Rene Talbot opposed.