By MorinvilleNews.com Staff
Sturgeon County – Council gave unanimous first reading to two borrowing bylaws that would permit Sturgeon County to borrow up to $991,000 to purchase three new graders and one tanker / plow truck.
The total cost of the four new pieces of Sturgeon County equipment is estimated to be $1,425,000 – $1,180,000 for the three graders and an additional $245,000 for a new tanker / plow truck.
If approved, the borrowing bylaw would allow Sturgeon County to borrow a maximum of $746,000 for the graders. The remaining funding for the equipment would come through an estimated $290,000 for the sale of existing equipment, $87,000 from Sturgeon County’s Capital Reserve Fund and another $57,000 from 2011 tax dollars.
The proposed borrowing bylaw for the tanker / plow truck would allow the County to borrow the full estimated $245,000 cost of the truck. Repaid over three years, Sturgeon County would make an annual repayment of $84,000 with interest on the debenture expected to be $8,800 over the term of the loan.
“I think this is something we have to do and something we discussed in the budget,” said Councillor Tom Flynn, adding he felt a five-year debenture term was the appropriate way to handle the loan.
Councillor Ken McGillis said the recent inclement weather and snowfall had shown the need for the purchase of new equipment but said the county needed to start putting money aside to replace its equipment in the future.
“We have to get into a system where we put equipment reserves away,” he said, noting setting aside money to replace the county’s equipment would eliminate the need for debentures. “[Otherwise] we’re going to leave a legacy of a lot of debt.”
The estimated lifetime of the graders is 10 years; the tanker / plow truck approximately 20 years. Councillor Karen Shaw advocated purchasing three different makes of grader so that the County could asses which make performed the best over the equipment’s life span.
Sturgeon County’s outstanding debt as of the Dec. 31, 2009 audit was $13,576,541. It is estimated County debt as the Dec. 31, 2010’s audit will be $16,636,231.54. The County’s debt limit is $50,821,000.
The two borrowing bylaws are scheduled to be given second and third reading at the Feb. 8 council meeting.