CORNWALL, Ontario – City of Cornwall Chief Financial Officer (CFO) Tracey Bailey explained the municipality’s current debt situation to Council during budget deliberations on Monday, Feb. 1.
As of Jan. 2021, the City of Cornwall currently had $39,799,200 of debt on the books, with Bailey stating that the city would add an additional $22,775,000 in 2021.
“Debt financing should be for projects greater than $2.5 million and would last 20 years and non-recurring,” said Bailey.
Some projects that will be financed through debt in 2021 that meet this criteria include the Cornwall Fire Services new fire hall and replacement of pumper number three, as well as the redesign of the Municipal Works Yard, a project coming in at over $14 million.
“In the 2021 budget we are borrowing for a number of projects that don’t meet this criteria,” Bailey admitted.
Smaller or ongoing projects that the city is borrowing money to finance include the $300,000 Emerald Ash Borer program, which is requiring that all trees in the city be treated to protect them from the Emerald Ash Borer, a beetle that kills most types of ash trees. Other projects include a new generator for the Glen-Stor-Dun Lodge long-term care facility, which comes in at $650,000, and the reconstruction of Marleau Ave. at over $1.2 million.
According to the 2021 City of Cornwall budget document, the city will be adding approximately $57.3 million in debt over the next four years, including the $22,775,000 proposed in the current year’s budget.
The province of Ontario allows a municipality to borrow up-to 25 per cent of that municipality’s total revenue sources, but Cornwall City Council has self-imposed a lower limit of 10 per cent. Currently, the City of Cornwall has borrowed a little over five per cent of debt when compared to its total revenue sources.
