West Kelowna Mayor Gord Milsom.
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February 10, 2020 - 7:40 PM
West Kelowna is pushing ahead on its plans for a new $18 million City Hall now because if it waits even another month it would require the consent of voters who turned it down just three years ago.
The last time the City sought to borrow money to construct a new City Hall in 2016, municipal finance laws required it to seek permission from voters, who defeated it twice. That’s because the city had crossed a threshold of debt to income that demanded it.
Now City officials see an opportunity while its debt maintenance obligations are low. Before it borrows heavily for a new Rose Valley Water Treatment plant in March, it plans to borrow up to $11 million for design and construction of a new City Hall.
Mayor Gord Milsom confirmed the “opportunity” to borrow without voter consent only exists until it goes back to the Municipal Finance Authority in March to borrow money for the treatment plant and potentially other projects.
“It's taking advantage of an opportunity to have some monies that can be drawn upon,” Milsom told iNFOnews.ca. “If the city’s debt is more than five per cent of annual income voter consent is required but since our debt is below five per cent, it’s not required."
If they wait until after they seek borrowed money for the treatment plant — or any other higher priorities including major roadwork, a public works yard and a new fire hall — they would be forced once again to get voter consent.
Adding to the surprise for voters is no previous indication that the City was eyeing a return to the drawing board for a City Hall. While Milsom said a City Hall was clearly laid out in Council’s strategic priorities for 2020, the only mention under “Invest in Infrastructure” is “Plan for City Hall.”
A report to council by CAO Paul Gipps, due to be considered by council Tuesday at 1:30 p.m., is the first mention of financing a City Hall this year and it seeks council’s consent to borrow up to $11 million. The report mentions several times that it involves no new taxes because the $700,000 that used to go into reserve would serve the debt, but for how long, he didn't say. Milsom said he and the City believe not raising taxes for a City Hall was one of the biggest concerns voters had, along with the need for higher priorities such as water treatment to be completed first.
Gipps outlined a plan to spend up to $18 million using a City Hall Reserve account that has been accumulating by $700,000 per year and should reach $7 million by 2022 when construction is anticipated. iNFOnews.ca has also learned that could potentially reach $20 million because another $2 million in a land acquisition reserve may also be earmarked for the City Hall if West Kelowna needs to acquire private lands. Its first priority will be to assess lands currently owned by the City.
Milsom said regardless of how it’s funded or the role of voters, West Kelowna needs a City Hall.
The city has grown to nearly 36,000 residents from 28,500 when West Kelowna incorporated in 2007. Municipal staffing has far outpaced that growth as well to 215 staff — plus nine more in this year’s budget — from 97 in 2007. Those workers started in the then-Westbank Lions Hall before moving to and taking over community amenity space in the Mt. Boucherie Community Centre beside Royal Lepage Place. As staffing expanded, three trailers were added to the space and West Kelowna pays roughly $65,000 per year leasing office space on Anders Road. Some staff have also been placed back into the Lions Hall, a city property.
“We’ve been in this facility (Mt. Boucherie Community Centre) since 2009,” he said. "I was on council then and it was always intended to be a temporary facility.”
Milsom also stressed that he believes they are abiding the wishes of voters by ensuring higher priority projects were planned for first and adding a City Hall to the budget and plans won’t impact those priorities.
“I’m very confident with the way we are proceeding because we need our first City Hall," Milsom said. “We heard from the public and they gave us some good feedback, they don’t want new taxes.”
He also said the City wants to take advantage of low interest rates and to avoid potential future cost increases for a City Hall by acting now.
The City won’t know what the water treatment plant will cost until bids are opened on the project in March. The City expects up to $41 million in grants from federal and provincial governments but will be on the hook for at least 17 per cent of the cost. It will pay for it with water rate increases for users, water reserves and borrowing. The City has cleared a site on Bartley Road and expects to begin this spring in what Milsom said is the City’s number one priority.
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