City council has put off a decision to borrow $8 million to complete the next phase of the widening of the Golf Links Road/Junot Avenue corridor.
Some council watchers are questioning why the city is considering the move in the first place.
After all, the Renew Thunder Bay fund is filled with overflowing with cash.
It would be easy to simply take that money and spend it on infrastructure.
But a debenture accomplishes several things, not the least leaving Renew Thunder Bay alone for a much bigger project the city has its eye on.
By taking out a loan it allows Thunder?Bay to get the work done, but spread the costs out over a number of years.
Rather than dumping the costs on this year’s taxpayer, it spreads it out. New homeowners will be asked to take on some of the burden in future years, which seems fair since they’ll also get the benefit of using the new widened corridor.
Present-day taxpayers won’t have to shoulder the entire burden all at once, and those who move away before the debenture is paid off will not have to pay for something they’re no longer using.
The downside is two-fold:?Interest paid on the debenture increases the cost of the project and it handcuffs the city’s ability to borrow money, if needed, for other projects.
