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2014-03-23 at 17:23

Council preview: Debt management and taxicab responsibility

By tbnewswatch.com
Rock Win a Weekend Escape at Dog Lake with your 94 Days of Summer, Rock 94Click Here

City council is being tasked with making a key decision on the city’s debt management strategy.

After being referred in January, the question of how to to fund the second phase of Golf Links road improvements is returning to council chambers at Monday night’s meeting.

Councillors have the option of borrowing the whole $8.2 million through debenture or only taking out a $5.2 million debenture and taking the rest from the Renew Thunder Bay Fund.

The project would see four-laning between Oliver Road and Riviera Drive as well as the addition of a new set of traffic lights.

Tbaytel is also asking to borrow $10 million. CEO Dan Topatigh said earlier this year that balance sheets are healthy but it’s a good time to borrow.

Also on the agenda, council will be asked to take authority over the taxicab industry in Thunder Bay from the Thunder Bay Police Services Board.

The police services board, which has overseen cabs since 1996, had voted in February to hand over responsibility to the city’s by-law enforcement department.

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Tbnewswatch.com(45)

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Comments

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SomeGuy says:
Given that the return that Renew thunder Bay Fund generates is greater then the interest rate when borrowing it make sense the borrow the funds.
3/23/2014 5:33:57 PM
Waldo Lydecker says:
in fact, why don't we borrow all the money we can, then give it to the re-new Thunder Bay fund to make more interest than we are paying and we will all be millionaires!!

I think you do not know what it is that you speak.
3/23/2014 8:52:09 PM
cm punk says:
TBayTel gave 17 million to the city no?
What would they do when they borrow money and what is it for?
3/23/2014 6:34:43 PM
sky high says:
Newsflash!!! The city owns Tbaytel!!! Tete d'oeuf!!! Ever hear of CASHFLOW?
3/24/2014 12:28:14 PM
Vanity says:
Wasn't there a very good reason for the Police taking over the taxi licences back in 1996?
3/23/2014 7:32:58 PM
tsb says:
Yup. It allowed them to hide the cost of managing taxis and several other things the budgets of outside boards instead of the city's general budget, presenting the illusion that money was being saved when it wasn't.
3/24/2014 6:00:35 PM
Common cents says:
I have lost all faith in this council, how long tell election day?
3/23/2014 7:47:36 PM
sky high says:
I believe it is in October, so get your fingies and tootsies out to count the days. I suppose your vote will go to chezhank for mayor then? And perhaps the other fellow who said that the citizens of Thunder Bay don't have to be educated on an issue to decide its fate. Now, we both (and all of us for that matter) know that with the exception of about two of them, the entire council will be re-elected. We all know that...those who think otherwise have been out with the fairies for years now.
3/24/2014 11:40:49 AM
Truthandjustice says:
Great another set of lights. I have to turn left onto golf links road everyday at the intersection where they are planning to add the lights. I never had a problem. Why do we need to put lights everywhere to help the bad drivers? This is going to back traffic up badly.
3/23/2014 7:54:58 PM
Eastender says:
Once its fourlaned, you're gonna need those lights.
3/25/2014 8:58:38 AM
Waldo Lydecker says:
Can you prove that? What interest rate are we paying on this particular loan? and what interest rate are we receiving on re-new Thunder Bay money?

If re-new is earning more interest than we pay on borrowed money there must be an identifiable risk on that money, otherwise everybody could borrow money from the bank and lend it out at higher rates.

Where does the bank get its money from to lend out?
3/23/2014 8:50:04 PM
musicferret says:
Mark my words:
Tbaytel will go from a profit centre to a cost centre in the next 3 years. They are in big trouble against Bell.

We should sell them off while they still have value. As soon as Bell gets enough towers up, Tbaytel is toast..... I can guess what the city will do when they no longer have a dividend coming to them each year. :-(
3/23/2014 9:14:31 PM
bttnk says:
@musicferret - And here is one of your posts that make it so very difficult to take you seriously. Crazy comments with absolutely no support.
An entity that has net profit in excess of $20 million annually is going to become a cost centre in 36 months? Exactly how? Wireless subscribers have grown in the last 12 months. Digitial TV exceeded growth forecasts for the last fiscal year and security services has also grown and recently made an aquisition that will grow subscriptions.

Yes, Bell is providing competition in the wireless marketplace, but that is good for the consumer and is forcing Tbaytel to take action via lean management strategies that will allow them to lower their costs over time. Something that is perhaps long over-due.

To suggest that the sky is falling is just another attempt to be negative at the expense of being rational.
3/24/2014 12:28:14 PM
musicferret says:
Ill keep it short and sweet:

1) They have been gouging us for years, leading to these inflated profit numbers

2) They now have real competition. Bell charges $50 for the same plan Tbaytel charges $70 for. Other than a slight advantage in terms of coverage, why would anyone in their right mind choose to pay 40% more for the same service by sticking with tbaytel? Plus even at $70, tbaytel is earning a fraction of the $ per customer it used to on these new plans.

I called for my wife to try and get tbaytel to match the bell plan, they said they couldn't because they would be left with virtually no profit on the plan, so $69.99 is the best they could do.

That in a nutshell should tell you why I'm not just blowing smoke. Do you really think an enterprise can survive that will now be charging 40% more for the same service as its competitors?

Yes, TV might add a little to the top line, but it is big $ to put in, hence the borrowing. And even there, margins R down due 2 competition.
3/24/2014 12:44:31 PM
bttnk says:
@musicferret.

1. Slight advantage in coverage? Really? Regionally, there is NO COVERAGE with Bell.

2. Correct, Bell charges $50 for the same plan that Tbaytel charges $70 for. Are you aware that Thunder Bay is the only market in Canada that Bell offers this plan at $50? This is literally the best plan being offered nation wide. Bell can offer this plan in a specific location, but not indefintitely as it is only for new entrants into the market. Stay tuned, that plan is coming to an end once they hit the subscriber threshold.

In the mean time, Tbaytel is offering pricing that is equal to or better than pricing offered in other markets by the national carriers. They've made a business decision to focus on lean management, rather then competing with a company that is new to the market on price. It isn't a popular decision in the short-term, but it is a necessary decision for long-term sustainability. Wireless subscribers have grown in fiscal 2013. So far so good.
3/24/2014 2:13:28 PM
conker2012 says:
1. Bell actually has better coverage in the city and from here to the boarder Bell and Tbaytel are the same. If you are going east, north or west currently Tbaytel has the better service, but try taking your Tbaytel Phone off their network or use it in Toronto...

I have had Bell, Rogers and Tbaytel and by far the best services and features have come from bell. When I am out of country my Bell phone works instantly for text, data, and calling while those whom I am traveling with have trouble with their Tbaytel phones. Messages don't work, data is slow or doesn't work at all.

If you only live and work in Tbay then Tbaytel will work for you. If you have a career that requires travel. Bell is your best friend. Yes travel packs cost more, but you get what you pay for.
3/24/2014 3:57:13 PM
bttnk says:
@Conker - Completely agree about travel. It really is a Rogers problem too as Tbaytel is "powered by Rogers" But nationally, the best service provider is Telus, the only company you haven't tried :) And it is why they are the fastest growing wireless company in the country.

I am actually a Bell customer and I lose service about 20 minutes from the Border and it is spotty until Lutsen. Heading East, no service beyond Crystal Beach Store. In the city, Bell is 4G LTE so they are faster, but my service isn't great in specific areas. Not much service in hockey arenas, over 50% of the hospital, my gym and a few others where Tbaytel has put up devices to ensure customers have service in those buildings. Such is the life of a company new to the market.
3/25/2014 8:35:15 AM
BetterThunderBay says:
I'd argue that the first question is a false choice. The real question is whether that stretch should be widened at all.

Does it really make sense to spend that much on widening a road that already parallels the expressway, and one that has a 40km speed limit in places? Does it really make sense to encourage more traffic in that corridor?
3/23/2014 10:57:16 PM
Wolfie says:
Definitely. Hopefully the Concerned Taxpayers are out in force against this.
3/24/2014 10:19:18 AM
bttnk says:
You are missing a very material point on the subject BTB. That is, this corridor directly services EMS services from a large portion of Port Arthur, with a direct link to Thunder Bay Regional Hospital. From a safety and risk management point of view, widening the corridor is the only option.
3/24/2014 12:33:56 PM
Wolfie says:
Shouldn't they have built the EMS where the arteries were, not the arteries to where the EMS is?
3/24/2014 7:22:01 PM
BetterThunderBay says:
Respectfully bttnk, that's what lights and sirens combined with shoulder room are for. I don't expect this to improve EMS response times or safety around emergency vehicles demonstrably. It hasn't been an issue so far. Population in TBay also isn't increasing (or hasn't over the last 40 years or so), making the justification for larger roads weak.

In fact, places that have tried "road diets" have not reported significant EMS impact. If you can find it, then let me know.
3/24/2014 9:43:54 PM
Tbaylifer 1 says:
What will happen with the third stage, between John street and Red River Road? Will the city be taking out another loan for this and any other infrastructure needs? This road is moving the city forward and the funds should come from the renew Thunder Bay fund. Just like they did for the first stage.
3/24/2014 6:47:11 AM
broken says:
this city has a debt management strategy? lol
3/24/2014 8:11:59 AM
jonthunder says:
Thunder Bay Tel is looking to borrow money while giving millions annually to the city?
3/24/2014 8:13:12 AM
chezhank says:
Golf Links/Junot was the pilot Renew Thunder Bay project,that never leveraged any funding from other levels of government.
To access that fund, money was to be leveraged,it never happened.They claim the seed money in the fund from the province was the leveraged funding,yeah right!
Golf Links/Junot is not even listed as a project in the 2014 capital budget,regardless of the fact that it will not affect the 2014 budget.A capital project should be approved at budget time in my opinion.
They will get a debenture for GolfLinks/Junot ,I say take it out of the Renew Fund,all $8.2 million.
Or is the money in that fund being saved for the proposed event centre.
After TBAYTEL puts $15 million into the Renew Thunder Bay Fund,TBAYTEL now has to get council's approval for a $10 million loan.
I say Council give $10 from the Renew fund back
to TBAYTEL.
Now we have no money in the Renew fund for a proposed event centre.It will have to be debentured and brought to plebiscite.

henry wojak
3/24/2014 10:10:10 AM
yqtyqt says:
While I think its great that the City has a debt management strategy, I think it would be prudent to tart a spending management study.

Out of control spending leads to out of control debt when taxes are already too high.

Once again, I welcome a very fiscally responsible debt policy. But I think management has to look at the real culprit here.

3/24/2014 10:10:11 AM
sky high says:
But the thing is, you don't understand simple economics, so how do you know that the city's spending is out of control? Like Armiento said, you don't have to be educated on an issue to decide its fate (yes, I'm getting repetitive but certain people need repetition) Truth is, it isn't. It's just you 100 or so from the library who got convinced by a certain someone that we are doomed to starve around here.
3/24/2014 12:25:31 PM
musicferret says:
How do we know?

Well, each year, our services are staying virtually the same, at best, and our taxes are growing at a rate well beyond inflation, all well having some of the highest taxes vs. real wages in the province.

100 or so people? You need to get out a little and talk to people. The city is seriously divided over the whole events centre issue, and I continue to see over 50% against it. Perhaps you have trouble understanding viewpoints other than your own? YQTYQT does not have trouble understanding economics in this case. The Chamber of Commerce agrees with him, as do I, but I guess YQTYQT, me, thousands of others, and the chamber of commerce are all just having trouble understanding things. That must be it. ;-)
3/24/2014 12:49:11 PM
sky high says:
The chamber of commerce got together with the city and they shook hands. Obviously the chamber of commerce has some people who don't get economics either and they panicked the others, and there was that chap from the university who totally got his figures stuffed up. And our taxes are about the middle of the pack or lower when compared with other cities in Canada. And as for wages, how can we create jobs around here when small, uneducated factions of people keep putting a kibosh on every large project Thunder Bay attempts to proceed with? It is people like you, musicferret, who hold back this city
3/24/2014 5:23:06 PM
Eastender says:
Its you who does not understand simple economics, skypilot. Its just addition and subtraction. You have ten dollars, you spend fifteen, you owe five. If you keep doing that, your in trouble eventually. And this city has long passed that point.
Yes its just that simple, no calculus required.
3/25/2014 9:11:12 AM
brandon says:
This city needs a spending management strategy.
3/24/2014 11:05:14 AM
NewAgeOutlaw says:
The main thing is that I have no debt and alot of assets. Thanks for the concern everyone
3/24/2014 12:14:07 PM
Citizen Peace says:
3/24/2014 12:51:18 PM
progress now says:
It is difficult to see ourselves as other people see us.

The evaluations of our city cannot all be ignored. The question is - what is to be done?

Our answer appears to be to import a little bit of Toronto with glass and chrome somethings or other and we will move into the 21st century.

But it really is about livability and neighbourhoods.Too bad our city consultants don't do neighbourhoods.
3/24/2014 2:08:00 PM
yqtyqt says:
Yep, its a long way to nowhere. What an interesting read though.

Lets bring on some more debt and an AHL franchise that will be here fore 3 years.
3/24/2014 2:11:35 PM
bttnk says:
I stopped reading when I saw "Thunder Bay is 10 hours from any other city". Hard to take this article seriously with that as its lead in to justification for the rating.
3/24/2014 2:16:35 PM
blah blah says:
Citizen Peace, your article talks of Thunder Bay as being isolated and nothing more. If isolation makes this a bad place to live for you then move. Why post negative comments that have no barring on the story.
3/24/2014 1:50:47 PM
Citizen Peace says:
This is not my article, it was prepared by Immigroup:

"Immigroup, an immigration law firm. This site combines free government information alongside paid assistance; you choose what works best for you. We are not affiliated with any government body. We present government information with simplified language, making everything quick to find and easy to learn about. We have put the services of many jurisdictions in one place. You can find all government services at a lower cost on the official websites. - See more at: "

Just because there is a problem, and an opinion is voiced against it, it doesn't mean one has to leave town. Can't we recognize the problem and try to resolve it?
3/24/2014 3:45:31 PM
karcat says:
For thunder bay & Taxpayers, spend all you can,
but 1st just remember all the lawsuits against
this city, who is going to pay this if the city
loses them all, ok & ty
3/24/2014 2:00:28 PM
jb says:
Are traffic lights at Riviera really necessary?
3/24/2014 2:31:02 PM
fastball says:
Why again does Tbaytel need a $10 million loan? I don't get it. Why can't they just increase the rates of some of the company’s products or services? Why are we paying for their suspicious business model. Fishy doings here.
3/24/2014 4:53:45 PM
Watchful says:
To Citizen Peace, unfortunately most people in this city do not want to hear what the country thinks of our city. Instead of trying to improve it, they will continue to tell you to move. Now we know why things never change here, same old. Same old
3/24/2014 10:30:28 PM
ou812 says:
More traffic lights!!! come on man.
3/25/2014 7:53:04 AM
Musicferret says:
Those who said tbaytel is just fine and will continue to pay us millions every year, just jump on over to their Facebook page and see te outrage at the "deals" they are offering. Plus, it would appear that the advantage in coverage is disappearing faster than money in a tbay taxpayers pocket.
3/25/2014 8:17:52 AM
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