The finances just aren't adding up

If the City of Peterborough currently has over 1200 ready to build residential units, why would people decide to build in the newly constructed complete community of Fraserville? Would it be their desire to live near the flight path of an expanded airport, the adrenalin rush from the noise of the car races, the brightly lit night sky, or the desire to raise ones family in the vicinity of OLG Slots? The lack of any modern recreational facilities, both indoors and out within the township certainly isn’t going to help attract new people to the township, especially when Peterborough has them all, right there.


And what’s going to make this newly serviced commercial and industrial land in Fraserville more attractive than the existing serviced lands in Peterborough that currently sit vacant? Signs indicating industrial lands for sale are visible along Hwy 115 driving past Peterborough by the Ashburnham and Parkway exits, listed at $40,000 per acre. The signs have been there for years. These lands will also be just as easily accessible to the newly expanded airport as the proposed lands in Fraserville. If there currently isn’t any buyers for these vacant lands in Peterborough, why will there suddenly be buyers lined up in Fraserville?

It’s great to forecast all the revenues that will be generated from these phantom industrial and commercial enterprises that can’t be named, and the 684 ‘to be constructed’ residential units that haven’t been sold in Fraserville, but ultimately who is going to be on the hook for any shortage of revenues that aren’t realized from a lack of commercial / industrial enterprises or homes that aren’t built. The township can’t tax or collect development charges from those that don’t come, and with stiff competition for both residential home sales and commercial / industrial tenants from Peterborough, development charges can’t simply be increased to make up the short fall.  Especially when the 2009 Development Charges for Peterborough exempt Industrial developments from development charges.

The federal and provincial governments have each earmarked $9.8 million in the form of Infrastructure grants towards the completion of the water and wastewater treatment facilities. As a condition of the grants, if the entire project isn’t completed by March 2011, the township won’t be receiving all of those monies. With an estimated project value of $30 million, the township would be on the hook for the remaining funds, including any cost over runs. The recent construction of the shelter at Maple Leaf Park was an example of a township project over budget. Considering this project is budgeted at around $30 million, why should we believe it’s not going to run over budget as well, only this time, given the magnitude of the project, the results could be financially devastating for our township.

In a 2007 article from the Ontario Good Roads Association, it was reported that the cost of the Cavan Monaghan water and wastewater project would be $30 million plus land acquisition but would not in any case exceed $40 million. Add in inflation since 2007, and those numbers are very concerning.

While these 684 residential units are built over the course of the next 20 years, on a $10 million loan at 5% over 20 years, the interest portion alone according to my calculations is over $5.7 million. If the plan is to charge $10,000 for development charges to each new residential unit, that’s only going to generate $6.84 million dollars, just exceeding the expense of the interest portion alone. If the townships final bill were to come in at $20 million, that same interest portion alone would sky rocket to over $11 million based on a 5% interest rate, almost double what the township would bring in from residential development charges for the 684 units. Add to that the ongoing maintenance of the new water and wastewater treatment infrastructure, and the costs continue to mount … for whom? On the backs of the few residents and commercial enterprises that initially come to Fraserville, or all the existing residents of the township? 

Spending $30 million by March 2011 to get water and sewer to Fraserville, in order to receive the grants is one expense, but what about the actual individual servicing of these new 684 homes and businesses? How is that going to be paid for? The proposed subdivisions with 684 homes and commercial enterprises are not all going to be in place by March 2011, and the development charges are said to be making up the $10 million that the township has to put in to receive the full grants. If that's the case, where's the money coming from to actually service these new homes and businesses when those arrive after March 2011? I would really like to see the math showing how our tax dollars and OUR reserves are not going to be required to complete this project?  What about the costs associated with providing additional services such as police, fire, and schooling to these new residents?

Are we creating a huge financial burden for all citizens of Cavan Monaghan?  Second question, why are we risking this?

Be sure to complete the online petitions at www.socm.ca


I believe it’s time that such major decisions affecting the future of this township are made based on the wishes of a majority of people in this township, and not just a select ‘few’. Put this decision to a referendum vote, and let democracy set the course for the future of this township.