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More Debt for Moose Jaw
Get The Facts About Moose Jaw's Escalating Debt
Moose Jaw is governed by The Cities Act which states we must apply to the Saskatchewan Municipal Board to raise our debt limit before we can borrow more money. We are legally bound to the debt limit set by them and are unable to exceed it.
The approval of the downtown multiplex project on June 16th, 2008 resulted in the need for Moose Jaw to increase its financial commitment by $19,530,560 which will have to be borrowed and financed through an estimated 9.76% tax increase. This would cause us to exceed our current debt limit.
Delays and Debt
The City chose to wait 6 months until December 2008 to request the debt limit be increased from the previous $37 million to $63 million. As of Feb 13, 2009 no response has been received.
The City didn't request the debt limit be increased by just the $19.5 million approved by the project. Council asked for an additional $26 million. The extra $6.5 million is to bankroll community fundraising that is as of yet uncollected, having been pledged only. Some pledges are to be paid over as many as 25 years.
The estimated interest costs of this borrowing is an additional $19,873,253.
Should the requested debt limit increase be rejected, the City has no backup plan to obtain this extra $26 million.
Council's Debt History
2001 to 2006 - The City held a $5 million debt limit but had $0 debt
2006 - request to increase debt limit to $20 million passed
2007 - request to increase debt limit to $35 million passed
2008 - request to increase debt limit to $39 million (passed
for $37 million only) *
2009 - request to increase debt limit to $63 million pending
City Debt Levels **
| City | Population | Debt | Median Income |
|---|---|---|---|
| Moose Jaw | 32,132 | $0 | $52,064 |
| Prince Albert | 34,138 | $6,876,137 | $53,083 |
| Regina | 179,246 | $43,290,000 | $70,353 |
| Saskatoon | 202,340 | $47,656,000 | $65,268 |
* Only $2 million of the requested $4 million was approved at the time, setting the debt limit to $37 million. $4 million was requested to assist with the Westheath subdivision. Once Council approves the other phases of Westheath a request can be made, again, for the additional $2 million that was rejected on first request.
** As of Dec. 31, 2007. See how Moose Jaw went from $0 to $63,000,000 debt in 14 months.
Resources
Answer to enquiry Sept. 27, 2008 Number of requests for Moose Jaw to increase their debt level.
Answer to Enquiry Dec. 17, 2008 Debt levels of other Saskatchewan cities.