Prince George’s draft capital budget for 2025 includes about $56.33 million in spending, the Standing Committee on Finance and Audit heard at its Dec. 4 meeting.
That's up from the just over $40 million in capital spending in the approved 2024 budget.
The draft capital budget presented at the committee meeting contains a list of projects that have funding sources and those that do not.
Before presenting a draft capital budget, staff work hard to make sure that the resources capacity is in place for the projects and they’re all critical, must-do items, said Tiina Schaeffer, the city’s manager of sustainable community development.
“It looks at not only the proposed new capital plans and programs that are made in the plan, it also looks at what’s on the team’s plates underway now ... it also considers industry availability and timing and even economies of scale that can be realized when we go out for different contracts, tenders, things like that,” Schaeffer said.
“We’re also considering supply chain delays.”
Schaeffer said the draft 2025 capital plan is about 71 per cent renewal, 18 per cent is upgrades and 11 per cent is new programs or projects.
Major projects in 2025 include:
- $7 million for road rehabilitation projects,
- $3.5 million for upgrades to the Hart sewage lift station,
- $2.74 million for Two Rivers Art Gallery HVAC upgrades,
- $2.5 million for water distribution system renewal,
- $1.9 million for Carrie Jane Gray Park upgrades,
- $1.8 million for wastewater treatment plant renewal,
- $1.575 for sidewalk and walkway renewal,
- $1.2 million for sanitary sewer system renewal,
- $1 million for sanitary lagoon re-routing,
- $1 million for sanitary forcemain and lift station renewal,
- $1 million for new water distribution system components
Following up on Schaeffer’s remarks, director of finance and IT services Kris Dalio said that the spending on the capital project is based on the operating budget including a one per cent hike in the tax levy charged to property owners for the General Infrastructure Reinvestment Levy.
That one per cent component of the operating budget’s overall proposed 6.55 per cent tax hike would work out to $1,388,391 more for the infrastructure levy than in 2023.
“If council were to come along and say ‘we want to cut the budget, so we want to cut that levy,’ you automatically impact this capital plan, we’ll automatically have to start unfunding items from it.
Funding sources for Prince George’s capital projects in 2025 include:
- An overall General Infrastructure Reinvestment Fund Levy of $5,360,873,
- Canada Community Building Fund payment (formerly the Gas Tax Fund) of $3,500,000 and
- Provincial gaming funds worth $2,700,000.
Staff’s warned that the last figure is dependent on gaming revenues. If casinos close, like they did during the COVID-19 pandemic, that amount could be reduced.
Dalio added that the city gets about $3 million in gaming funds, but $300,000 is taken off the top for the major events reserve.
While staff’s report said that a year’s capital funding can be bolstered by unspent funds for a cancelled project from a previous year, there have been no cancellations so far in 2024.
The proposed 2025 capital budget proposes two debt-funded projects.
The first is a new building automation system and chiller for the Civic Centre at an estimated cost of $3,260,000. A building automation system will control the facility’s heating, ventilation and parts relating to the air conditioning.
The second is renewal of the city’s stormwater system, which includes work on ponds, flood pumps, manholes, catch basins, culverts, storm mains and more. The cost of that work is estimated at $2,620,000.
Counteracting some of that new debt, $869,000 worth of annual debt servicing costs are set to expire in 2025 for money initially borrowed in 2005.
That includes:
- $103,000 in annual costs for borrowing related to snow disposal downtown and in the central bowl,
- $135,000 for several road rehabilitation projects,
- $31,000 for phase two of the city yard project,
- $91,000 for improvements to the Exhibition Grounds and
- $509,000 for improvements to the Hart/Nechako water supply.
Under provincial regulation, the city cannot take on an annual debt servicing load greater than 25 per cent of its annual controllable revenues like property taxes, payments in lieu, user fees and unconditional grants.
As of 2023, the city had room to borrow almost $425.9 million. A 2024 figure was not available in time for the committee meeting.
While sometimes people think of debt as a bad thing, Dalio said it’s not necessarily the case.
“We have access to great (interest) rates through the municipal finance authority,” Dalio said. “We can counter and maybe even beat inflation by using their services.”
The draft document also showed projected capital spending for both funded and unfunded projects for 2026 through 2029.
It projects approximately $49.92 million in funded capital projects for 2026, $39.82 million in 2027, $43.87 million in 2028 and $39.4 million in 2029.
Unfunded capital project costs for 2026 are projected at about $37.32 million, $18.81 million in 2027, $22.47 million in 2028 and $22 million in 2029.
Combined, that would be about $87.24 million in capital spending in 2026, $58.64 million in 2027, $66.34 million in 2028 and $61.4 million in 2029.
Going forward, Dalio suggested that the committee flag currently unfunded capital projects early in the year.
There’s usually a finance committee meeting in the summer that doesn’t have anything on the agenda — Dalio said staff could investigate the cost and feasibility of adding those projects to a future year’s agenda and present their findings at that meeting.
One of the city’s plans for 2025 is to create a dedicated stormwater utility for managing water drainage. Dalio said recommendations on how to implement that will come before council sometime next year and will incorporate incentives for people who redirect water away from infrastructure, like with rain barrels.
Last year, upgrades to Memorial Park Cemetery were removed from the capital budget and are included once again in this year’s budget. Staff said that project has been downsized, eliminating much of the security component and aesthetically improving the entrance and some of the areas around the columbarium.
Council’s two budget meetings are currently scheduled for 3:30 p.m. on both Jan. 20 and 22, 2025.
A full list of proposed 2025 capital projects can be found online at https://pub-princegeorge.escribemeetings.com/filestream.ashx?DocumentId=29237
