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Council gets back to work this week, after the briefest of breaks. What should have been a week off was interrupted by a fistful of planning files looking for resolution before the new Official Plan was made official. Which was done on July 8.
It has been a busy six months. Big files. Small items. Contentious issues. Plenty of the mundane. I am confident suggesting that never has the business of County government produced so much in such a short time. Shire Hall is due for a break. But not this week.
Two big spending items caught our attention this week—Highway 49 at $23 million, or $27 million if we choose to replace the 18- kilometre concrete road with concrete. And a wastewater equalization tank in Wellington at a yet to be determined cost—though it is safe to speculate that a project that requires $186,466 to design will likely set the County back an amount ending in millions.
Council won’t commit taxpayers or waterworks customers to these expenditures this week—just take a small step toward them. That is how it is done—step by step forward until council members are staring into a deep dark hole, and then sheer momentum thrusting them forward by that point.
While there is some runway left, perhaps we could talk about the escalating cost of government. Responding to COVID-19 has necessitated massive expenditures at every level of government. Most of it borrowed money. Canada’s net debt is now more than $1 trillion after racking up a deficit of more than $354 billion last year. A $155 billion deficit is expected this year. Ontario entered the pandemic with staggering debt levels. Queen’s Park figures it will add about $100 billion to our collective obligation by the end of this year.
Municipalities aren’t permitted to run deficits, but they can and do run up debts. The County’s debt belongs to waterworks customers and taxpayers. Yes, these groups overlap, but it is important to remember that only waterworks customers pay waterworks debt. (Especially when folks without any stake in the utility are making decisions on others’ behalf, including encumbering them with fresh debt. But this is for another time).
I don’t know how much the County has spent fighting COVID or supporting this community through the past 15 months or so, but we can safely speculate it, too, ends in millions.
None of this is to suggest that it shouldn’t have been done. Nor that it could have been done better. There will be reams of autopsy reports, annals of academic study and a boatload of new courses developed to study the economic and societal fallout from this event.
They will inevitably conclude that missteps were made. Files dropped or bungled. Targets overshot. These exercises will be useful to prepare for the next time. But they will do little to inform us on what we do now.
We can all take pride and solace that our governments responded robustly—not perfectly, but in the main, effectively. We might be a bit more apprehensive, however, that once empowered with borrowed money, governments may become accustomed to big spending.
As the remit of this column trains its focus on local government, let us turn back to the big-ticket items that will ask council members to make a small step this week.
Highway 49 is too big. Too expensive. Too risky. Yes, it is a bumpy road. And it costs more each year to fix. But we—County taxpayers— don’t have enough money to fix it. Nor do we have a plan to fund the $200 million of other roadworks that were needed seven years ago. Nor does the condition of this road deter a single visitor to County. There just isn’t a good economic or public safety argument for tackling Highway 49—unless, and until, the province and feds are picking up the bill (and putting it on their debt pile).
And perhaps that is the gambit—get ready for the infrastructure tap to be opened. Fine, just as long as council is aware that this is what it is doing and is prepared to pull back when this funding doesn’t come. They do not want to be alone staring into that deep dark hole.
Adding an equalization tank in Wellington will fix a problem that occurs a few days in the spring and fall. Not every year, but some particularly wet seasons have pushed the wastewater plant beyond peak capacity. Only two options are on the table—buy the EQ tank ($ unknown) or replace the entire plant ($26 million). The EQ tank is undoubtedly the more sensible option—but we don’t know the whole picture. We need an explanation of the cost/benefit analysis. What happens if we don’t do this? What if we delay it a decade?
When waterworks utility customers rely on folks without a direct interest in the system to make these decisions, important questions do not get asked. Or probed thoroughly enough. Answers aren’t produced. In time, managers stop thinking in those terms. It is a poor way to run a utility.
It seems that at some point—I know not when—there will be a reckoning. A world awash in debt will one day ask for it to be repaid. A generation of folks has grown up without knowing what inflation and rising interest rates do to finances—personal, corporate and governmental. It is an obscure artifact of another era. They do not remember a time when the carrying cost of our debt consumed the largest share of government revenue and our household budget.
I worry they will awake one day to find inflation and interest rates driving every decision in their lives. Or perhaps not. But what is the harm of acting as though gravity remains a working force in the universe?
As we emerge from the ravages of the pandemic, it seems prudent to pause and consider how much more debt we can and should take on. What kind of debt spending is likely to generate increased economic activity and drive revenue? It seems a moment to consolidate, to use the emergence from a year of quarantine to slow down, to consider the path forward—a bit more cautiously.
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