A new payment plan will see property owners directly benefitting from upgrades at the Snug Cove Wastewater Treatment Plant (WWTP) take on more of the costs.
The $1.6 million project was approved by council at the end of January, with $1 million coming from Capital Renewal and Replacement Reserves and the remaining $640,000 from Unappropriated Surplus. The underlying rationale for using general funds was upgrading the WWTP benefits the entire island, since most businesses and services operate out of Snug Cove.
But following two months of public pushback, and the hiring of a new chief financial officer, Kristen Watson, the municipality reconsidered their position earlier this month.
Watson explained at the March 14 council meeting that “Snug Cove is home to the services and to the amenities that our community relies on. So I think it is fair and reasonable that some of the cost of the upgrade be attributed to all taxpayers.”
“But I also think it’s fair and reasonable that as a local service area (LSA), property owners within that LSA should be attributed directly with a share of the costs,” the CFO continued.
“Bowen Island has always funded all of its LSA on a self funded principle,” said Watson upon returning with a new payment plan at the March 28 council meeting, pointing out projects in Eagle Cliff, Tunstall Bay, Bluewater, and Cove Bay didn’t receive general funds.
The CFO’s proposal is for Snug Cove residents to pay approximately 44 per cent, or $718,677, of the $1.6 million upgrade bill. Island-wide property owners will split the remaining $921,323.
The formula was determined by examining projects between 2015 to 2021 that both matched council’s strategic priorities, and will benefit from the WWTP upgrades. Four made the list: the new apartment building on Area 1, Lot 2; the Foxglove properties, due to their relationship with the Snug Cove House; the new fire hall; and the library, since it needed to be connected to the sewer after fire hall construction erased their septic field.
Each of their share of the plant upgrade costs: apartments ($629,765); Foxglove ($233,246); library ($34,987); and fire hall ($23,325), add up to the $921,323. Watson says since these projects benefit the whole island, they can be split Island-wide.
Parcel taxes and user fees will be Snug Cove payment options
The remaining $718,677 would be repaid by members of the Snug Cove LSA over the course of the next seven years. This will be a combination of a 75 per cent parcel tax and 25 per cent user fees.
For the average residential user, this is estimated to mean about a $664 parcel tax each of the next seven years, along with an approximate $117 raise in user rates. Commercial and multi-family properties will pay the same parcel tax, along with applicable user rates.
“I think it strikes a balance, ensuring those who use more, pay more,” says Watson. “But it also provides an opportunity to defer a portion of the amount through the property tax deferral program if the property owner is eligible.”
Watson explains the seven year plan, while more expensive per year than the 10 year option, was chosen because “we’re looking at preserving our reserve fund balances right now. I think the sooner the money gets repaid into our reserve funds, the better financial position the municipality will be in.”
Properties which will one day benefit from the WWTP upgrades, but aren’t currently connected, can also be exempted from the parcel tax until they are hooked up.
Coun. Alison Morse expressed her wish that the cost attributable to Snug Cove residents be higher, and questioned whether the apartments and Foxglove should have been included in the equation. But Coun. Sue Ellen Fast says both housing complexes benefit all of Bowen.
“They are private lots to enable us to provide rental housing island-wide… This is to benefit Islanders island-wide who may be in need of rental housing at some point in their lives, or workers,” says Fast. Regarding Foxglove, she notes while they are private lots, “these were private lots that were sold by the charity that was trying to bring supportive housing for seniors. Which we don’t have anywhere else on Bowen.”
Mayor Gary Ander agreed, saying “Snug Cove House would not be going ahead if it wasn’t for those lots being sold at Foxglove. So it was part and parcel of the same deal.”
In the end Morse, noting she did so “reluctantly”, joined Fast and the rest of council – minus Coun. David Hocking who wasn’t present – in approving the new payment plan. The $718,677 will go into the general funds as accumulated operating surplus.
In order to approve the parcel tax before the May 15 budget deadline, next steps will be to prepare the parcel tax roll, notify property owners, and perform a parcel tax review panel.
