Letter published in the St Marys Journal Argus August 9, 2006
The 1,154 people who have signed the petition are waiting for a response from Council.
Town administration have responded with paid ads confirming tax increases will be miniscule and that everything is fine in Goderich.
But where is Council's response?
I hope they are now wrestling with concerns the residents' group has raised with their financing assumptions.
I can't imagine Deloite Touche would suggest Council follow their estimates blindly.
A normal process is to challenge each assumption in the plan, compare the expected results with actual operating experience and then act in a conservative manner. After all, Council is spending our money, not their own, and you should always be more careful with someone else's funds than you are with your own.
So we can assume that Council is analyzing each assumption and confirming where all the money will come from.
After all, we need to cover $1.5 million each year for the next 20 years to support the Pyramid project and the operations centre. Taxpayers have been told all they have to pay is the planned two per cent tax increase or $140,000 based on last year's assessment.
The mystery is how Council can find the other $1.36 million per year to cover their capital needs.
The second consultants' report from Monteith Brown also finds the presumption challenging.
They state Council will have to pass on a 24 per cent tax increase if they follow this course.
Therefore, Council must have great confidence the fundraising team can overcome the objections they face at 1,154 doors to sell potential donors on the benefits of contributing to a project their taxes are already paying for.
Next, Council can move on to challenging the operating assumptions.
Deloitte Touche says the complex will cost us $162,000 more than the existing ice pad and Quarry/Cadzow swimming facilities. The consultants also say we can simply divert 62 per cent of Town's facility maintenance budget to this area and presto - no cost to the taxpayers.
I guess we are fortunate that the other municipal buildings can be repaired for the bargain price of 38 per cent of the normal budget.
Managers of the post office, daycare, train station, library Town Hall or Quarry may never have their facility repaired.
How do our assumptions compare with other new facilities?
Frankly, Aylmer did not have a good year.
Its two new ice pads operated at a deficit of between $568,000 and $458,000 worse than Deloitte Touche's estimate for our new pads.
The St Marys town operating deficits for the last two years and the large cost overrun of the town operations centre does not create a feeling of confidence that our municipal mangers will succeed where Aylmer hasn't.
Council must determine where Aylmer ran into difficulties so capital and operating plans can be adjusted to keep these new ice pads viable.
Aylmer minor hockey has taken fundraising activities to other facilities since they can't afford their own complex's user fees. Surely, Council's plan must avoid these issues.
Goderich spent $19 million building the complex originally costed at $8 million.
Goderich property taxes have increased 40 per cent over the last four years.
The annual operating deficit was originally estimated at $137,000 per year in 2002.
The project is budgeted to have a deficit of $650,000 for 2006.
Goderich spends over $500,000 per year on utilities alone for its new facility.
The annual cost to residents is still over $1.6 million when the operating deficit and debt payments are combined even after residents fundraised over $5.5 million.
Clearly, St Marys councillors should be concerned their Complex's operating budget will be influenced by factors that Deloitte Touche has not considered.
So Council, we understand you may need some time to fire up your calculators and to make some phone calls to check some facts.
Call other municipalities for more data and challenge the Deloitte Touche assumptions. However, don't just let administration do your inquiries - make some calls yourselves.
You're committing $14 million and confirming your legacy - you should be absolutely sure you're following the best course.
Take some time to get back to us but also add an extra month to the Pyramid contract and ask the contractor to leave the site until you have done your due diligence.
Don't be afraid to consult the 1,154 people who signed the petition - they understand debt and risk as well as you do and I'm sure they'd be glad to help.
Yours truly
Andrew Atlin, St Marys, Ontario