Update Posted
July 10 - While the Town's principal debt is at $53
million, the interest on that debt at maturity totals $25.1 million,
which increases long term debt service obligations to about $78
million. Ward 3 councillor Paul Whiteside noted last night that based
on a population of 30,000 people and the principal debt included in the
audit, New Tecumseth residents owe $1,757 per person.
Audit statement confirms Town debt over $53 million, plus
interest
Posted July 9,
2012
New Tecumseth's long term debt is pegged at $53.1 million, excluding
interest, as of Dec. 31, 2011, according to the 2011 audited
financial statement included on tonight's council agenda.
The largest debt obligation is in wastewater operations which shows
$33.8 million plus interest owing, followed by $13.4 million for
recreation facilities (NTRC mostly). There is $5 million outstanding
for roads debentures, and $751,934 for protection services (fire truck
debentures).
Principal payments will total $3,096,962 in 2012, $3.2 million in 2013, then drop to $2.7 million in 2014. That's the result of a maturing debenture in 2013 which has the highest bearing interest rate of 8.5 per cent to 9.5 per cent.
Development charges are identified to cover 65 per cent of the
outstanding debt, while future taxation revenues are to contribute 33
per cent, and utility user rates will account for two per cent.
Despite the level of debt New Tecumseth has incurred - almost
all of it in the past six years - the Town still has credit room to
take on additional annual payments up to $1,607,170.
"Based on current interest rates, this annual repayment amount would
allow the Town to incur long-term debt for the following amounts and
terms: $14,100,000 for a 10 year period at 2.58 per cent, or
$23,400,000 for a 20 year period at 3.30 per cent; or $29,300,000 for a
30 year period at 3.61 per cent; or a combination of above.
That credit room is going to be used up within the next couple years as
long term debentures are expected to pay - serviced by DCs when
available - for the expansion of the Parsons Road reservoir in
Alliston, and the reconstruction of the sewage treatment plant in
Tottenham. Both are growth related projects necessary to accommodate
planned residential construction.
Other facets of the audit show the Town had approximately $314 million
in tangible capital assets at year end, up from $297 million in 2010.
When amortization of $77 million is factored in, the net book value was
$236 million.
There is $9.82 million in unrestricted cash, held at the bank, and
about $11.43 million in restricted cash held at the bank. There is $2.4
million in employee future benefits and other liabilities including
$829,303 in vacation accural and $638,000 in retirement accural, and
$449,066 in dental and health future benefits.
In 2011, the Town transferred $828,230 for its contribution to the
Ontario Municipal Employees Retirement Fund, up from $688,029. The
pension obligation is raised through taxation.
The full audit statement will be posted on the Town's web site for
review following council voting to receive the package, next Monday
night.
