The proposal to borrow $22.15 million to refurbish the Prince George Aquatic Centre will be taken to counter-petition.
City council voted Monday in favour of the step.
More formally known as an alternative approval process, it gives voters 30 days to express their opposition and if a threshold of 10 per cent is met, the matter would have to be taken to a referendum in which at least half of those who cast ballots on the matter would have to vote in favour of borrowing the money for the step to be taken.
As of April 17, there were 55,126 registered voters in the city, meaning the threshold for the counter-petition to succeed is 5,512. The clock would start ticking on July 5 and end on Aug. 9 at 5 p.m.
Under the Community Charter, “approval of the electors” is required whenever a local government seeks to secure a loan from the Municipal Finance Authority that lasts more than five years. Both a counter-petition and a referendum are considered valid options.
If the proposal survives the process, council would be given the leeway to borrow $22.15 million to cover the cost and pay it back over 20 years. Based on 4.87-per-cent interest, debt servicing costs would be $1.85 million per year and impose a 1.34-per-cent impact on the property tax levy.
However, the timing of what year these costs would impact the levy depends on when the work is completed and the funds are borrowed, staff said in a report to council.
Coun. Cori Ramsay predicted interest rates will drop in the coming years.
"We could see a loan rate between two and three per cent...it really is beneficial for us to take on this long-term debt rather than financing it in chunks as we go," Ramsay said.
In the last budget cycle, council put aside one per cent of the levy for future capital needs, Ramsay noted.
"By the time this comes on, we will have put aside an additional three per cent. I think there is some padding in the capital plan that will allow us to perhaps use some of that padding in order to reduce some of that load on the taxpayers so a lot of this is just really smart financial business sense and I do hope that the electors will support that," Ramsay said.
"And I would just further add that all of these upgrades, there's nothing fancy, nothing above and beyond these life-safety things. These are things that are going to increase the life of the building, they're going to reduce our energy costs so that we save money. This is a good thing, it just has a big price tag attached to it."
The money would be spent on an extensive multi-phase refurbishment and upgrading of the building, which is more than 25 years old. Some $14.9 million has already been earmarked for the work, bringing the total bill up to roughly $37 million.
Mayor Simon Yu voted against, saying he wants more detail on the work planned for the facility.
"I do have an issue with the price tag. I have an issue with not knowing with the greatest detail of the mechanical part versus the envelope parts," he said.
"I do see there is an opportunity to use this exercise to improve the aquatic centre as a whole and to not go to the public to simply say we've got to go $36 million (sic) to make the aquatic centre better."
Cost was cited as the reason to not take the matter to a referendum.
"Running a referendum is just like running an election. I believe we budget about $130,000 for an election," finance director Kris Dalio said.
As well, legislative service manager Ethan Anderson said the impact on staffing would be "immense."
"The entire legislative services department works some elections, so most projects would fall to the side while we do the referendum," Anderson said.
Building a new aquatic centre from scratch would cost $100 million, council has been told.
