Credit Assessment

COUNTY DEBT

In the mid-2000s, the per capita long-term debt was $350. Today, the County’s external long-term debt sits at just under $1,200 per person.  This is despite Rocky View having the fifth largest tax assessment base in Alberta – something the County regularly boasts about.  So, how have we benefitted from all that debt?  The full extent of the Rocky View’s debt and how it will be paid back has never been made clear.   The County still has over $90-million to be collected from developers through off-site levies for the east Rocky View water and wastewater infrastructure and over $100-million in commitments to upgrade that system.  I will continue to ask pointed questions regarding the County’s financial situation.  With a better Council after the October election, those questions might actually get answered rather than being shut down.  I strongly believe that councillors should ask questions about the County’s financial position.  My track record demonstrates my commitment to fiscal prudence.


Much of the debt is due to inadequate off-site levies in the past. The original levy rates were so low that the initial wave of development attracted by the East Balzac water/wastewater system failed to pay anything close to its share of costs.  Unfortunately, this means that existing ratepayers are on the hook – the ability to recoup what should have been collected a decade ago from future development is limited. 


This Council has now also taken on significant debt for water/wastewater infrastructure on the west side of the County with debt-financed purchases of the Horse Creek Water / Wastewater system in Cochrane Lakes and the Blazer Water System in south Bearspaw.  While the purchase of the Horse Creek utility can be justified due to on-going servicing issues and fee-gouging, the acquisition of Blazer had no comparable rationale.  For both of these acquisitions Council received extremely limited information on debt servicing, pay back methods and growth projections.  This does not work for me.  Council and ratepayers deserve a deep dive into the County’s finances, not only for these “one-off” initiatives but for the entirety of the County’s budget.


One of the troubling aspects of the County’s long-term debt is that we have been borrowing from residents to pay the bankers.  Since 2013, the County has taken $1 million per year out of general revenues to pay interest (and occasionally some principal) on the external debt taken out to build the east Rocky View water/wastewater system.  If there was any reasonable expectation that future development will repay these amounts, this shift might have made sense.  Regrettably, that seems to be a “pie in the sky” dream.


This council has also dramatically accelerated borrowing from ratepayers to finance infrastructure “investments”.  Led by Reeve Henn, the council majority approved using $9.6 million from the Tax Stabilization Reserve (the ratepayers’ rainy-day fund) to extend piped water and wastewater servicing to West Balzac.  Again, if there was a mechanism to recoup this from development, it might have made sense.  But the majority on council didn’t bother to put any such mechanism in place.


For development to pay the costs of the infrastructure needed to support it, the County must have adequate off-site levies.  In 2013, the initial completely deficient levy rates were increased to more sustainable levels.  In 2019, Administration recommended additional increases to the levy rates to move the County towards better cost recovery so the debt could be repaid more effectively.  However, the current Council majority chose not to do this.  Instead, they opted for the lowest rates possible.  As a result, the County continues to "borrow" money from existing ratepayers rather than collecting sufficient funds from development benefiting from our infrastructure.  If re-elected, you can be sure that I will push to have these levies reassessed.

Vote Samanntha Wright for Division 4 Councillor.