City’s debt load decreased significantly

Penticton Herald staff  05/28/2012 
The City of Penticton‘s debt load decreased significantly in 2011, according the city‘s audited financial statements. The city‘s net long-term debt dropped to $74.4 million last year from $80.6 million in 2010. Doug Leahy, the city‘s chief financial officer, said no single project accounts for the overall debt reduction but much of it is related to the South Okanagan Events Centre. The original borrowings of that project were $33 million and by the end of 2011 there was $20.48 million left,” he said. An $8-million portion of the SOEC debt (borrowed over a five-year term) is due to be retired in 2013, with two other loans (10-year terms) due to be paid off by 2017-18. A related $7 million loan for site servicing at Queen‘s Park will be retired in 2027. Annual debt payments on the SOEC in 2012 will amount to more than $4.2 million, much of that financed through casino revenues. It will take longer for the city to pay back the $7.4 million it borrowed for the recently completed $23-million pool upgrade at the Penticton Community Centre. That debt is scheduled to be repaid by 2030 with payments of $581,000 budgeted for this year. Coun. Garry Litke noted the city has also lowered its general operating costs, which represents a significant saving to the taxpayer. Meanwhile, Leahy said a major revamp of the city‘s financial and budgeting system will be carried out in 2012. “We‘ve changed the process of our budgeting, but we haven‘t changed the actual system and the hardware and software,” he said.  Mayor Dan Ashton said the new software should allow for the city to have “a little bit more of a handle on the day-to-day opportunities and operations that will present themselves.”