"A Watson Associates study of Shelburne's water and wastewater capital needs over the next 30 years has placed town council squarely on the horns of $3.9 million dilema."
This would SEEM to say that Shelburne is needing $3.9 in capital repairs, and they may, BUT it is over the next 30 years....
So, while I would like the headline of this blog to read "$3 MILLION DEFICiT FOR WATER/SEWER AND SHELBURNE WANTS TO BUILD A $15 MILLION YMCA" it wouldn't right, fair or honest. And I am nothing if NOT honest, particularly when it comes to how Highlands is screwing local Councils around over the YMCA.
The exercise that Watson did for Shelburne is one that all Ontario municipalities have been mandated to go through. While the fancy word is Tanglible Capital Asset Accounting, in municipal circles it is referred to as PSAB.
In private business the owner/operators know when a piece of equipment, machinery is outdated, when it will need replaced and have the replacement costs in their heads and/or on the books and are always cognizant of what it will cost, when and how they will pay for it.
Councils on the other hand, are the "boss" for 3 or 4 years, depending on their term and some, not all, tend to go for the short fix. The low hanging fruit if you will, you know, something visible that won't impact taxes too much that will get ratepayers attention and if they are lucky, get politicians re-elected. IF not, then the replacement and upkeep of the item becomes the next bosses (Council's) problem. This is NOT just local Councils, this is the pattern of lots and lots of Councils.
An example of this might be a YMCA-you can't help but see it when you drive into a municipality. Repairs to something visible tend to happen, because you can see the paint flaking, the lights blown out, the sign falling down.
With other things, particularly infrastructure that is invisible-like water, sewer lines, etc. under the ground and out of sight, Councils have been tending to put these capital replacement costs off. Particularly since stable funding from province has all but stopped over the past 10-15 years.
You might have heard about this phenomina, called the Infrastructure Gap.
The "PSAB" exercise puts a value on everything owned by municipalities at the time of purchase/construction, including the pavement, stoplights, bridges, pipes under the grounds (as well as buildings, equipment, etc). Then the depreciated cost of the asset over the estimated lifespan of the asset is also given a value. (E.g. a bridge built in 1910 at a cost of $500,000.00 might have a lifespan of 100 years so the value of that bridge is zero today). Not only does the value of the assets get shown on financial statements, but the depreciation value as well.
It is hoped that this will show Councils which capital assets need replacement in order of need, not want, and help them budget for replacement. For example, clearly that 100 year old bridge with no value better get replaced and SOON.
So.....how does this have anything to do with the YMCA?
Well if the YMCA gets built some municipality is going to have to show it as an asset, and also show the depreciated value/lifespan and it is going to impact their bottom line.
Like I say, the cheap part is building it.
And if we NEED a YMCA, then be honest. What other facilities will you close, what is the bottom line cost to ratepayers on an ongoing basis. The entire plan would never have got to the point of a study if there wasn't a business case/plan in place. WHERE is it?
Probably the same place the study to reduce blowing snow on County Road 124 (you know the publically owned road) is located-Highlands head office, I mean a post office box in Hamilton.
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