Town has no problem covering its debt, says mayor
© Photo by Nicholas Mercer/The Compass
Arthur Burke is mayor of the Town of Victoria.
Editor's note: This article first appeared in the Feb. 5th print edition of The Compass.
The Town of Victoria has no problems covering its debt. With a debt-servicing ratio (DSR) of nine per cent, the Conception Bay North community comes in well below the benchmark of 30 per cent set by the Government of Newfoundland and Labrador.
"Every year, we're getting better and better," Mayor Arthur Burke told The Compass last week.
The DSR is a town's municipal debt divided by the combination of a town's local revenue and municipal operating grant.
The provincial government likes to see municipalities keep its DSR below 30 per cent each year.
Victoria makes it a priority to ensure it is able to cover its debt.
"We've always paid off debt by ourselves," said Burke. "It's no problem for us to cover our debt."
This concentration on reducing the town's debt has allowed Victoria to steadily become financially stable over the last couple of years.
Last month, Victoria passed its 2013 municipal budget, which stands at roughly $1.4 million.
"We have real good financial stability," said Burke.
Like other towns in the Trinity-Conception region, Victoria saw its residential property assessments increase. This prompted the town to lower its mill rate from 9.5 to 8.5.
Victoria's assessment increases were some of the lowest in the region, at average of 28 per cent.
Under this increase, a home that was previously valued at $150,000 might now be valued at $192,000.
Whereas that homeowner would be paying $1,425 with the old assessment and mill rate, now the owner would pay $1,632 with the new assessment and mill rate.
That is a difference of $207, or 12.68 per cent.
"We're one of the towns that had the lower assessments," said Burke.
Burke said that through the assessments, his town would generate $142,000 in extra revenue.
"If we did not drop the mill rate, our citizens would've had some substantial increases," he said. "We didn't want to raise taxes unless it was absolutely necessary.
"It was only fair to give it back to our citizens."
Praise for Penney
Burke gave Jeanette Penney, his deputy mayor, high marks for the work she did with the budget.
Penney, who also chairs the finance committee, was preparing and delivering her first budget.
"She did an excellent job," said Burke.
Victoria did not have to change much with its 2013 budget. Burke said that there are subtle differences between 2012 and this year, but much of it is the same.
"It takes care of everything in our town," he said.
Victoria's finance committee did a little bit of forecasting when lining up budget amounts for departments.
"We're trying to think ahead of time," said Burke. "We'll say here is an area, last year, where we didn't spend it all, and we'll take some of that money ... and get things done.
"We haven't taken anything away."
Overall, Burke said council and the finance committee were "quite pleased" with the budget.
"We feel that it is quite adequate to fulfill our financial obligations in 2013," said Burke.
Here are some highlights of the budget:
° $59,071 for fire protection;
° $80,000 for streets, roads and sidewalks;
° $30,000 for snow removal;
° $52,000 for the water supply;
° $31,000 for recreation and community centres.