Last chance to prevent a costly dent in city’s future


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On Monday at 5 p.m., Brandon City Council will conduct a public hearing regarding the proposed $30-million loan to finance the construction of the proposed southwest wastewater lift station project.

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On Monday at 5 p.m., Brandon City Council will conduct a public hearing regarding the proposed $30-million loan to finance the construction of the proposed southwest wastewater lift station project.

The hearing will be the final opportunity for Brandonites to express their opinions about the controversial scheme before council holds its final reading of the bylaw to approve the loan application.

In other words, this is the public’s last chance to convince council to stop this ill-conceived money-loser of a project. Once the loan is approved and construction of the facility begins, there will be no turning back. Residential growth to the north, or even large-scale residential redevelopment in established areas of the city, will be virtually impossible for at least the next two decades.

I have previously written about the cost of urban sprawl and the fact that the new neighbourhood would never generate enough revenue to cover all costs it would create.

And I have talked about the potential consequences of the massive amount of borrowing the city is doing. We are rapidly approaching our debt ceiling, with property taxes and water rates climbing in order to pay for all that borrowing.

Today, I am going to focus on that last point, because it’s become obvious to me that the $30-million figure is misleading.

During a Jan. 10 special meeting of city council, city director of finance Tara Pearce told council the proposed $30-million loan, repaid over 20 years at a 5.525 per cent interest rate, would require the city to make annual payments of $2,515,590 over those two decades.

Do the math and you will see the total cost to the city of this loan isn’t $30 million. It would actually cost Brandon taxpayers at least $50.3 million over 20 years — and that doesn’t include millions more that would have to be spent over that time on repairs, maintenance and upgrades. If interest rates continue to climb, or if the amount required to be borrowed increases (for example, if the project is more expensive than estimated), the annual payments would be even higher.

The final cost to taxpayers could easily be more than double the $30-million amount of the loan. That’s more than $60 million that would be taken out of Brandonites’ pockets (through higher taxes and/or water rates) for a project the vast majority of us would derive zero benefit from. Those funds would not be available to pay for other important city priorities such as our growing infrastructure deficit, improved recreation facilities and emergency services, affordable housing and downtown revitalization.

During that same Jan. 10 meeting, Coun. Glen Parker argued the homes that would be built in the new southwest subdivision would generate $2.5 million in annual property tax revenue for the city, and it “would do a fair bit of debt servicing.”

That’s a gigantically optimistic calculation but, even if Parker’s correct, it would mean taxes derived from the homes would barely cover the principle and interest payments under the best-case scenario. They wouldn’t cover any of the maintenance and upgrade costs, however, nor other city services in the area such as fire, police, snow clearing and garbage pickup. All of those costs would be shouldered by taxpayers in every other area of the city. We would be subsidizing that neighbourhood forever.

Parker also claimed that the subdivision would generate $4 million in development charges, but that’s a mirage. In the unlikely event those fees are ever collected, they would be plowed back into further infrastructure spending. They would not reduce property taxes or water rates.

All of that is a concern, but there’s more.

You might recall the previous city council voted to borrow more than $30 million to improve drainage systems south of Richmond Avenue. A large chunk of that expense is necessary because it’s now clear the drainage plan approved as part of city council’s approval (almost 20 years ago) of the housing development in the southeast corner of the city was inadequate to prevent the overland flooding that often happens in that area.

City council, city administration and the developers got the drainage plan wrong and Brandonites have been stuck with the tab, to the tune of tens of millions of dollars in loan payments that we are paying through higher property taxes.

The land in the southwest corner of the city is just as low, swampy and flood-prone as the land on the southeast corner of the city. What are the odds we could be stuck with the bill for “drainage improvements” for the southwest subdivision 20 years from now? Are you willing to wager tens of millions of tax dollars to find out?

It appears some of our councillors are willing to make that bet, with your money. That is, unless enough Brandonites convince them this subdivision, and the loan it would require, are bad for Brandon.

I’ve said my piece in multiple columns. It’s your turn. Contact your city councillor. Call or email the mayor. Their contact information is found at Show up at Monday’s meeting and tell city council the vast majority of Brandonites don’t want this project, and don’t want this loan.

This is our last chance to prevent this mistake from being made. Don’t waste it.


» Twitter: @deverynross

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