Mountain View County has been asked to enter into a $3 million loan agreement with Mountain View Seniors' Housing authority (MVSH).
The authority owns and operates seniors' housing facilities in Olds, Didsbury, Carstairs and Sundre. Its board is comprised of appointed representatives from area municipalities, including Mountain View County.
MVSH is asking the county to borrow the money on its behalf with the Alberta Capital Finance Authority (ACFA).
“MVSH’s request is for a $3 million loan over a 20-year period,” CAO Sam Smalldon told council. “The issue for us is to help us address our cash crunch and overdraft situation.
“This is a request to refinance our capital. This is a refinancing question for us and a request to you. We have our overdraft almost fully used by the end of December.”
The current rate for a 20-year term with ACFA is 2.257 per cent, which is below other rates available though other financial institutions, he said.
“ACFA rates are declining and for us it’s an opportunity window,” he said. “The lowest rate right now is though debenture borrowing.”
Coun. Al Kemmere noted that although the money would go to MVSH, the debt would belong to the county.
“Even though we have a repayment plan, this is our debt,” said Kemmere. “The burden of this sits on our books.”
He called MVSH a valuable resource in the community.
Coun. Greg Harris said, “For me the right thing to do is to support MVSH. We want to see them succeed.”
Reeve Bruce Beattie, who is the chair of MVSH, says there are ongoing efforts to keep costs down at the authority’s seniors' facilities.
“The whole idea of this (loan through AFCA) is to reduce their interest costs,” said Beattie. “Cash flow is the issue we are having.”
Council passed two related motions. One calls on administration to create a bylaw for first reading to enter into a loan agreement with MVSH, and the other calls on administration to create a bylaw for first reading to borrow from the AFCA.
Details of any repayment agreement would be included in the proposed new bylaws.
The bylaws could come before council at the next council meeting, scheduled for Sept. 4.
Councillors Duncan Milne and Angela Aalbers did not attend the Aug. 28 council meeting.
