Referendum sought for $7.4m loan

Christine Wood/Staff Writer / Staff writer
January 17, 2014 01:00 AM

Residents of Sechelt will be asked for their approval to borrow $7.4 million for the new sewage treatment plant, rather than the $2.5 million loan most were expecting.

The larger loan would come with a $1 million grant attached to it from the Federation of Canadian Municipalities' Green Municipal Fund.

The grant would in effect pay for the interest on the loan, calculated to be about $905,000 over 10 years, and bi-annual payments would be covered by current sewer user fees.

If approved through referendum the larger loan would mean Sechelt could leave most of their reserves in place.

Originally the District planned to pull about $9.5 million from sewer reserves, sewer treatment development cost charges and the District's unrestricted operating surplus fund.

The new plan calls for $5.9 million of that funding to stay put.

Sechelt Mayor John Henderson called the new funding option an "extraordinary funding opportunity" for Sechelt during the Jan. 15 regular council meeting.

"Really we're getting a little bit more money and it's providing us with a great deal of flexibility going forward by retaining more reserves for other projects," he said.

Because the proposed loan is more than $5 million and it will take more than five years to pay back, the issue must go to referendum for approval from constituents.

On Wednesday council was asked to give three readings to a bylaw to borrow the $7.4 million before the issue could be sent to the Inspector of Municipalities for approval and the setting of a referendum.

"I will vote in favour of these readings because I think we're going to have an opportunity to have good discussion with the community and I think this has been very much a want for our community to have some input into the decision around this project," Coun. Alice Lutes said. "So I'll vote in favour of having a referendum."

All of council was in favour when the question was called.

It's unclear when the Inspector of Municipalities might give his OK for the referendum, but Henderson noted the Federation of Canadian Municipalities needs an answer by March, so a referendum will likely be scheduled in the next couple of months.

He said the District will work to inform people about the issue before a referendum date is set through roundtable discussions and District publications, however some residents at the meeting were unhappy with the roundtable idea.

"Personally, and I know others feel, that roundtable discussions can be, have been, very divisive. I like to hear what you have to say and what you have to say," Betty Ann Pap said, pointing to councillors. "Please have a meeting where we can hear everybody's comments."

Henderson said he would "take that into consideration."

"It is about giving people a chance to speak," he added.

If the public votes against borrowing $7.4 million the District will revert back to borrowing $2.5 million and using the reserve money to finish paying for the new sewage treatment plant on Ebbtide Street.

"We were happy with the original plan but this is just so much better that it's a win for everybody," Henderson added.

See staff's report on the funding option in the Jan. 15 council agenda package on pages 41 to 43, which can be found at

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