The City of Vernon’s infrastructure deficit could break the bank.
Council has been told that there currently isn’t the financial resources to come up with the $17 million a year needed to replace $78 million in roads, sidewalks and sewer lines.
“Projected revenue is insufficient to cover planned expenditures,” said Dan Huang, a senior planner with Urban Systems.
“Over time, you need to close this gap.”
Presently, reserves are being depleted, there is insufficient borrowing capability and there are cash flow challenges with development cost charges.
“Every city has this problem. Vernon is not alone,” said Coun. Bob Spiers.
To prepare for the future, the city is working on an assessment management revenue plan as part of an overall initiative looking at infrastructure sustainability.
Among the options to narrow the gap between revenue and costs are lobbying senior government for grants, financing alternatives, new development opportunities and changing levels of service.
The city can also look at ways to extend the life of existing infrastructure through maintenance.
“We want to get more out of our assets,” said Mark Dowhaniuk, the city’s infrastructure engineer.
Some steps to generate revenue have already occurred with a 1.9 per cent tax increase this year being designated for infrastructure.
Roads are the primary focus and an integrated transportation framework will be pursued over the summer.
Mayor Rob Sawatzky admits Monday’s report presents some challenges.
“Receiving this reminds me of taking cod liver oil as a kid. It’s good for you but it doesn’t taste very good,” he said.
Spiers believes it’s critical for the city to separate what is necessary for maintaining operations within the community and items he deems to be a wish list.
“Replacement and maintenance are more importance than new and unsustainable ones,” he said.
As part of the process looking at infrastructure, council will consider a 15-year capital plan and three-year capital implementation plan in October.
