Saugeen Shores Council officially established a Legacy Reserve Fund on Tuesday, April 24th, and designated it as a Discretionary Reserve Fund to be used for future significant legacy projects which benefit the whole community.
The reserve will be funded through a contribution identified in the annual budgeting process, as well as through funding received from Ontario Power Generation (OPG) and any other contribution opportunities approved by council. The 2019 Municipal budget identifies $665,000 from the tax levy to be contributed to the fund annually in addition to the $750,000 annual contribution approved in 2018.
According to Sue Murray, Director of Corporate Services, “If these projects were debt-financed the estimated yearly principal and interest payments based on 3% for a 10-year term loan would be approximately $150,000 annually. The overall estimated interest costs over the course of the loan would be $205,000.”
Therefore, in order to preserve as much borrowing capacity going forward for future capital projects, staff recommended that the projects be financed on a one-time only basis through this reserve and not debt financing, which was approved by Council.
Based on projections, Town staff anticipates that the Legacy Reserve Fund should accumulate approximately $11 million by 2023.
“We are the fastest growing community in our region, and we need to ensure our infrastructure and services continue to meet the needs of our community,” says Mayor Luke Charbonneau. “Putting this money aside will help us responsibly finance those major projects when the time comes to carry them out, particularly given that the Province considers us a low-tax, high-income area and, therefore, we receive little in the way of grants.”
