The City lacks housing suitable for those who are severely physically handicapped. Given the size of the City’s uncommitted fiscal reserves of about $70 million, I supported a $1.6 million loan at prevailing interest rates.
Even with bank financing and the City loan, the project's cash flow might not be enough to support operating costs (maintenance costs, a reserve fund for repairs, utilities, etc.), together with mortgage payments. Therefore, City staff made the recommendation that the City provide an ‘operating grant’ of up to $300,000 to be drawn upon only in the case of a potential cash flow shortfall. This grant troubled to me, because a shortfall can be contributed to by the failure of B.C. health authorities or other government programs to make timely payments to the occupants of the building. The City relies on a narrow property tax base and cannot afford to make up for the failure of senior levels of governments with a broader tax base meet their obligations.
During the council meeting at which project was approved, I suggested that up to $300,000 be added to the $1.6 million loan instead of gifting it outright by way of grant. The mayor and some fellow councillors claimed confusion. To my regret, my proposed amendment to that effect was defeated and I ultimately voted for the grant.
In general I will not support subsidies to one group of City residents by the rest of the City taxpayers. In this narrow case, I ended up supporting the grant because VRS is a well-run organization that serves truly needy clients that live, or should be able to live, here in the City. A balanced community should offer this type of housing and this argument would not likely apply in very many other circumstances. In future, I will focus my efforts on seeing the City’s fiscal capacity used to build assets and maintain the City in a way that can benefit all of the City’s residents and not just a few at a time.