BN05-24: CITY GETS QUARTER-MILLION GRANT FOR PUMPHOUSE

Nov. 3, 1999

By Mark Nielsen, Daily News Staff

Dawson Creek will receive $256,750 from the provincial government to upgrade the pumphouse on the bank of the Kiskatinaw River, the city’s source of drinking water. Mayor Blair Lekstrom welcomed the announcement, made by municipal affairs minister Jim Doyle, saying that the grant covers about 25 per cent of the cost of the project. "It’s very welcome news," he said.

Add on the new water line and the city is looking at a bill for about $2 million for which a debenture has already been issued by the Municipal Finance Authority (MFA).

Lekstrom said he will suggest at the next council meeting that the grant money be put into a fund to cover the cost of future work on the city’s utilities.

"We’d use this within the water utility to secure a good financial future," he said.

Simply using the grant to pay down the principal on the debenture is not an option, Lekstrom said, because the city would still owe all the interest accumulated for the duration of the debenture.

"When the MFA goes out, they sell bonds, and for 20 years the city is going to be guaranteed this interest," he said. "So if we’re fortunate enough to come into a big windfall of money and I walk in to pay it off, we still owe them the 20 years of interest because they’ve already guaranteed to pay that out."

Lekstrom disagreed with assertions from some quarters that Fair Share money should have been used for the project.

"We’ve had to use the Fair Share to offset the arena litigation process because we’re paying up front for a $4 million project that originally we thought insurance was going to pay for," he said.

Lekstrom said he’s also hesitant to use Fair Share money for a utility. "I think I’d prefer to use Fair Share money for capital infrastructure outside our self-liquidating utilities," he said. "That’s my preference, and this council has agreed to that as well."

Paying cash up front is always the best first option, Lekstrom said, but the city lacked a good savings plan to deal with a $2 million expenditure.

Introducing a savings plan will be part of the platform Lekstrom is set to unveil at tonight’s all candidates meeting (Kiwanis Arts Centre, 7 p.m.).

Lekstrom said he’s also proud of what has been accomplished so far.

"With everything the city’s been through in the last three years, with arena roofs collapsing, with water systems and reservoir sloughing, I’m pretty proud of what we’ve been able to accomplish with no increase in tax rates," he said.