MORRISBURG – There’s just over a million dollars in the bank South Dundas could use for infrastructure upgrades – profits from its stake in Rideau St. Lawrence Utilities (RSL).
Council got a fiscal update last night (Tuesday) on where its investments stand in the public utility after the transfer of the South Dundas Hydro Electric Commission (PUC) in 2000.
Rideau St. Lawrence Utilities Inc. CEO John Walsh and Jamie Pollock with the auditing firm of Craig, Keen, Despatie, Markell LLP shared the figures with councillors.
South Dundas took a 33.6 per cent stake in RSL (just over a million common shares) as well as a $938,000 promissory note after the transfer of the PUC in October 2000.
Since that time – between interest, compounded interest, dividends and growth – South Dundas has amassed a nest egg of $1,044,000 that it’s free to use. (The township has received a total to $567,000 in interest from the promissory note alone since 2000, $309,000 in dividends and $167,000 in interest on the bank account).
“You have not used any money for investments or capital projects,” Pollock said.
With lower hydro rates than Hydro One, CEO Walsh also shared the so-called “hidden dividend” which is the difference between what RSL customers are paying for hydro and what they would pay if they were with Hydro One.
In 2014, the difference was roughly $950,000 or just over $300,000 for South Dundas (based on its 34 per cent share in the utility).
While impressed with the figures, Coun. Archie Mellan said the principle should never be touched but there is just over a million dollars to work with for infrastructure, without negatively affecting the utility.
The presentation was brought on after Mellan asked in a previous council meeting for more information on the money sitting in the township’s books from the Rideau St. Lawrence.
Rideau St. Lawrence Distribution Inc. serves 6,000 customers in South Dundas, Edwardsburgh-Cardinal, Prescott and Westport. The four municipalities are shareholders in the company.