Council moves forward with bylaw for Hydro borrowing
By Nelson Daily Staff
Council has taken the first step in authorizing the City to borrow up to $6 million toward Nelson Hydro infrastructure projects.
The first three readings of the loan authorization bylaw passed at a special Council meeting on Monday afternoon.
This is the first of several steps before borrowing moves forward. Next the bylaw must be approved by the Inspector of Municipalities, then by the community through an Alternative Approval Process and finally by the Regional District of Central Kootenay.
The Alternative Approval Process (AAP) is a method for local governments to gauge public opinion, one that is less expensive than holding a referendum. It is a method commonly used in relation to long term borrowing bylaws.
The proposed borrowing will allow for the continuation of Nelson Hydro’s infrastructure improvement program. This program includes the downtown conversion project, building the Rosemont substation, distribution system upgrades, generating plant upgrade (G4 rewind), transmission line rebuilds, and improvements to the substations and generating plant.
“The timing here is worth noticing,” says Mayor John Dooley. “The City borrowed $8 million to fund the new Hydro generating plant (G5) in 1996, and prudent borrowing practices by our financer, the Municipal Finance Authority have resulted in that debt being retired two years earlier than originally scheduled.
“This is really good news. It means that the foresight that Council had over fifteen years ago has paid off, and we are in a strong position to further invest in our infrastructure.”
Mayor Dooley said 1996 seemed like just yesterday. At that time the City was in a significant infrastructure deficit position — the whole system required major renewal, generation, transmission and distribution.
“It seemed daunting at the time, but here we are in the final stages of renewing our entire Hydro utility,” he said. “This borrowing will allow us to continue reinvesting in the jewel of our City.”
If approved, the City would borrow up to a maximum of $6 million to fund these capital infrastructure projects. Financing rates are very competitive right now and this will allow the city to lock in to some of the lowest rates in years.
These low interest rates, combined with the early retirement of the G5 borrowing will allow Nelson Hydro customers to continue to enjoy some of the lowest electricity rates in North America, while continuing to invest for the future.
If it goes forward, the borrowing would be repaid through Hydro rates and would not impact residential property taxes.
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