Langley Township council heard presentations on capital spending and options for reducing taxes or funding more projects at the Monday, Feb. 3 meeting. (Matthew Claxton/Langley Advance Times)

Langley Township council ponders borrowing for budget

Councillors are considering options to bring down property tax increases

Langley Township councillors pondered borrowing or delaying some projects Monday, as they heard from senior staff about options for this year’s municipal budget and property tax increase.

A number of options, including simply cutting spending on capital projects – physical infrastructure ranging from new roads and sewers to purchasing new furniture for Community Policing Offices – to borrowing money were laid out by Karen Sinclair, the Township’s director of finance.

Mayor and council expressed some concerns about the option of using debt to reduce taxes in the immediate future.

“I don’t want to short change the next budget or the next council,” said Mayor Jack Froese.

He noted that Metro Vancouver deals with big capital projects with a debt strategy, and it looks like that’s one of the choices facing the Township. But Froese noted that Metro Vancouver has strategies and policies in place to keep its debt manageable.

Sinclair pointed to comments from several councillors over the course of budget discussions, including Councillor Petrina Arnason and Coun. Kim Richter, that would create longer-term debt and financial planning.

The options under discussion would involve the Township cutting the amount it spends on capital projects by between $1 and $2 million, and using that money in various ways, including to service new debt of approximately $15 million.

“How long will that $15 million be on the books?” asked Coun. Margaret Kunst.

“The repayment would be 20 years,” said Township administrator Mark Bakken.

Maintenance costly

Coun. Eric Woodward asked if the Township wasn’t contemplating borrowing money to solve the fact that it borrowed money in the past.

Bakken said it was partially true, but it would be more accurate to see it as borrowing to acquire assets the Township couldn’t otherwise afford – but that new assets also cost more to maintain.

Sinclair pointed out that $140,000 is being added to this year’s base budget to take care of new assets the Township has been given by developers. Developers build new roads, storm drains, trails, street lights, and other amenities, but after a certain time limit, the Township has to take over maintenance.

The options are not recommendations, Sinclair emphasized, just examples for the council to consider.

At the start of the budget process, Township staff offered a range of options based on spending needs, increased costs, and discretionary spending.

A “keep the lights on” budget, with no expanded projects, would cost a 4.12-per-cent increase in Township property taxes.

Projects extended

Various levels of discretionary spending and recommended spending could have taken that as high as 9.7 per cent.

Those numbers have now been reduced, as Township staff have suggested a number of multi-year projects that could be extended even further to cut costs.

Four year projects would become five year projects, or three year projects would become four year projects, Sinclair explained.

The base budget is now down to 3.86 per cent, and the top end is under nine per cent.

She noted during Monday’s presentation to council that some recurring costs have simply become too big for Township staff to keep funding them as part of regular operations.

Cleaning up homeless camps, for example, has become such a big and ongoing project that it can’t simply be filed under a regular departmental budget.

No final budget or tax rate has yet been put up for a vote.

Township council will resume its deliberations next Monday, Feb. 10 at 12:30 p.m. in Township council chambers.

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