The Municipality of Chatham-Kent (CK) is facing a $2.7 billion dollar infrastructure gap and council is being warned that current service levels can't be sustained long-term unless the significant gap is addressed.
A staff report going before CK council on Monday night says operating with such a significant funding gap for water, wastewater, roads, bridges, and culverts will lead to increased maintenance costs, higher risk to human safety, reduction of services, reduced operating hours, inability to replace assets, increased risk of fines, penalties, or lawsuits, and lesser likelihood of receiving grants from senior levels of government.
"When a gap is as considerable as $2.663 billion and in conjunction of the available funding resources to the Council, it is clear that the current [levels of service] cannot be maintained as they are, and considerable work will be required to manage and achieve sustainability over time," staff said in the report.
Council is being encouraged to manage the mammoth funding gap by setting an annual target to reach sustainability over 30 years.
Administration said council has multiple options at its disposal to manage the gap and sustain levels of service for current and future generations.
They include reducing levels of service based on affordability; increasing or reallocating funding for the gap, borrowing money; requesting funding from upper levels of government; getting rid of assets or closing them to reduce long term operations, maintenance, and renewal costs; consolidating facilities to reduce costs; and deferring projects.
"Achieving a balance among suitable tax rates, effective use of debt, optimizing and right-sizing assets and services, along with securing funding from higher levels of government, is essential for Chatham-Kent to attain intergenerational equity and the desired service levels," staff noted. "It is crucial for Chatham-Kent to focus on making its services sustainable; otherwise, service levels will significantly decline over time."
According to staff, consolidating multiple services and disposing assets are being considered.
Going forward, administration said each service will seek community feedback regarding service levels to inform the budget process.
Council information sessions will also take place to outline the process for setting future levels of service and review potential financial impacts on the next multi-year budgets.
