Huntsville - Lake of Bays Lakes Council

Debt Reduction Update: as of September 2^nd, 2008 council meeting.

Source

District of Muskoka -District Council -Meeting Minutes - September 2^nd, 2008

SUBJECT:

Committee of the Whole- Debt Summary- As Presented at the September 2^nd, 2008, Council Meeting. Please refer to attachment for complete set of Minutes.

Debt Reduction Initiative

i) Recommendation

BE IT RECOMMENDED THAT the mandatory connection program

continue as scheduled,

ii) Recommendation

BE IT RECOMMENDED THAT lagoon haulage charges be set at $40

per 1000 gallons for 2009 and increased by $10 each year until 50% of

the Sewage Lagoon Services operating expenditures are funded

through haulage charges

iii) Recommendation

BE IT RECOMMENDED THAT $2 million be transferred from the

General Capital Reserve Fund to the Debt Reduction Reserve Fund;

AND THAT the Ontario Disability Support Program savings above the

initial savings of $685,000 as identified in 2008, be used to top up the

annual contributions to the Debt Reduction Reserve Fund of $795,000;

AND THAT the principal due upon maturity of the balloon payments as

outlined in Report No" CES-6-2008-6 be financed from the Debt

Reduction Reserve Fund;

AND THAT the Debt Reduction Reserve Fund be used to issue

internal loans to finance capital projects at zero or minimal interest

rates .

iv) Recommendation

BE IT RECOMMENDED THAT The District Municipality of Muskoka

continue to use the Federal Gas Tax Funding to finance sewer related

capital projects until such time as the debt levels are stabilized and

reserve fund balances are at viable levels.

v) Recommendation

BE IT RECOMMENDED THAT the 2008 base for Environmental

Services of $3,050,439 as approved in the 2008 General Tax

Supported Budget be maintained and that this base be increased

annually to maintain its purchasing power by the Reed Construction

Price Index or an equivalent index,

vi) Recommendation

BE IT RECOMMENDED THAT the Water and Sewer Systems should

only finance road related replacements and/or upgrades associated

with water and sewer projects to the extent that it replaces the road in

the same condition it was in immediately prior to the project initiation;

AND THAT to the extent that there is an increase in the useful life of

the asset and/or an increase in the service standard, those costs

associated with the "betterment" should be funded independently from

the Water and Sewer Systems and financed from those functional

areas charged with providing that service ..

1-2 c)

vii) Recommendation

BE IT RECOMMENDED THAT the practice of allocating interest

charges to unfunded capital projects during the construction period

before the asset is brought into service be discontinued.

viii) Recommendation

BE IT RECOMMENDED THAT all projects prior to proceeding must

undergo an analysis to determine if the project is financially viable, is

essential for program delivery, and/or serves a wider community

benefit or addresses an approved corporate strategic priority..

Strategic Priorities Document Update No.1 Report No. 14(2008)-1

Recommendation

THAT the Strategic Priorities be updated in the following manner:

a) amend Section 2..2 by removing the last sentence, "Investigate a non urban

tax levy contribution to water and sewer costs";

b) replace the first sentence in Section 2.. 3 to read, "Adopt, review on an

annual basis and update as required, a debt reduction plan"; and

c) add a new second sentence to Section 2.. 3, "Report annually to Council

and the public the progress and results of the debt reduction plan".

For a complete copy of the agenda and minutes please go to the District of Muskoka Website; The minutes may be found under the directory: District Council/2008/September 2^nd,2008.