Capital conundrum: Cornwall behind its peers on bricks and mortar

CORNWALL – When it comes to the Seaway City’s bricks and mortar, a consultant says Cornwall is lagging behind many of its municipal peers.

Bruce Peever and Bailey Church with KPMG presented a long term financial plan to council Monday night.

Peever says the city is behind its other municipal peers when it comes to building up its capital assets.

“Cornwall is not really investing in its infrastructure,” Peever said.

“That’s a pretty stark statement,” Coun. Bernadette Clement countered, discussing the city’s sustainability. “How bad are we?”

Cornwall is last compared to Peterborough, North Bay, Belleville, Kingston and Brockville, council heard.

Peever also warned that the city could get into trouble if it increasingly relies on government grants.

Looking forward, Peever highlighted the city’s “very ambitious” $270 million capital plan through 2027, including a Boundary Road CNR overpass, a fire training center and an arts center.

He added that the city won’t get through its list without going to the bank – taxes and reserve funds won’t cover the financial burden. The city has $36 million in debt as of the beginning of this year and is set to take on another $61 million over the next decade.

The KPMG plan would see the city create a scaled tax levy starting at 0.25 per cent and increasing by 25 basis points until it reaches 2 per cent. The money would be only for capital projects – a plan that many municipalities have but Cornwall doesn’t.

The city should also restrict use of debt – only using it for purchases over $2.5 million for assets that will last more than 20 years. “You should not use debt to buy a pickup truck,” Peever said.

There are also proposed rules for life-cycle costing and for repayment of debt.

Council heard that Cornwall is one of the most diligent municipalities when it comes to keeping tabs on its operations. But Peever still cautioned about investing in capital.

Coun. David Murphy suggested that, on the whole, Cornwall is in good financial shape. Peever acknowledged it was true — but it was a leader in a group of under-performers.

Coun. Mark MacDonald, who has been very vocal about having a long term financial plan, was disappointed with the report, saying it lacked substance. He also questioned why councillors were not consulted when the report was written.

“It’s not going to be easy. But if we put these plans in place, we need to stick with them,” Coun. Denis Carr said.