Regina’s audit and finance committee is recommending that City Council approve a request to the Saskatchewan Municipal Board to raise the City’s debt limit to $780 million, an increase of $330 million.
The City’s debt limit is $450 million, with the City committing debt of up to $437 million in 2024.
“Considering the commitment City Council has made to the Catalyst Committees’ study and the infrastructure gap identified by City Administration, it is recommended the Executive Director of Financial Strategy and Sustainability proceeds with the application to the Saskatchewan Municipal Board (SMB) to apply for a debt limit increase,” a report to council read.
City administration is making the recommendation as the City’s approved debt is expected to peak at $437 million in 2024. Leaving the City with just $13 million in debt room remaining.
Administration also points to the potentially large capital projects that will require debt funding in the future years but have yet to be considered, projected, or planned debt at this time.
- Increasing Wastewater Treatment Plant Capacity;
- Ring Rail Relocation;
- Multi-Purpose Event Centre;
- Regina Public Library; and
- Other growth-related projects, including the Eastern Pressure Solution Project and other projects under the Development Charges Policy, require financing.
The majority of the projects are expected to cost over $500 million.
Increasing the City’s debt limit would also proactively position the City to react quickly should other funding sources (federal, provincial, private sector) be identified to support the financing of these projects.
The $780 million number comes after administration undertook a jurisdiction review of debt limits approved in other municipalities across Canada, including their actual debt levels and related debt ratios. Administration reached the $780 million number by looking at an increase based on 100% of consolidated revenue.
The last time the City raised its debt limit was back in 2013, from $350 million to $450 million, which at the time, represented 85 per cent of the City’s consolidated revenue.
The recommendations and report will be discussed at Wednesday’s city council meeting.
