The town council of Qualicum Beach had three readings of a bylaw that would allow them to borrow up to $9 million at a special council meeting on April 15.
The Revenue Anticipation Borrowing Bylaw is a short-term measure meant to help municipalities, which are not legally allowed to run deficits. They have not yet adopted the bylaw.
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“This bylaw is a just-in-case situation for borrowing for cash,” said John Marsh, director of finance for the town. “Just about every municipality in B.C., they’re looking at this right now on a just-in-case basis.”
Marsh pointed to property taxes not being due until June 30 (payments that could be pushed back farther due to COVID-19), which is where most of the town’s revenue comes from.
Marsh said the town isn’t expected to borrow $9 million, and that the borrowing would be a short-term lend. Marsh explained that the town pays other governments, mostly the RDN and the provincial government, for school taxes.
“In the town’s case, we have to pay about $5 million to other governments in property tax,” he said. “So if you don’t have the cash and we have to pay the other governments this money, we need a bylaw in place that authorizes us to temporarily borrow from the bank to be able to pay this cash flow.”
During the discussion, Coun. Adam Walker moved that council would include any temporary borrowing in finance reports, as well as prepare a report on the financial impacts of COVID-19.
It was moved unanimously.