I have grave concerns about the east side water and sewer project as was presented by the Town of Sundre.
It will have a devastating effect on a number of businesses operating on the east side, as well as having an adverse effect on some residential properties as well, such as those who are on fixed incomes.
The project, as it is being presented, places the burden of the cost of completing the project on the east side property owners, with the bulk of the cost expected to be born by the commercial property owners.
Yes, this project will make future development possible on the east side, and yes, those developers will be responsible for the cost of services within their respective developments.
As presented by the current proposal, access to those services that would be made possible by, and more importantly would be wholly funded by the current existing east side property owners.
It is totally unfair to arbitrarily force the existing east side property owners, and the commercial property owners in particular, to finance the costs and essentially give future developers free access to the benefit of the over sizing, as well as access to the initial installation.
I am told that the over sizing is capable of meeting the needs of a population growth of 15,000. Assuming that there are a thousand people on the east side, which I doubt that there are, the cost equation passed on to the east side property owners should be proportionally less than the whole of the $4,500,000. The approximate cost of $400,000 for over sizing the river crossing would have reduced the burden to be placed on the east side property owners.
Another argument that I am hearing is that the installation of water and sewer services will increase the value of the properties on the east side, and while that may be true to a point, the negative affect of assuming the huge cost of the improvement tax assessment allotted against the properties will reduce the selling price far more than the added value of these services.
As an example, I am told by realtors, that, in my instance, and based on the current information we have, the water and sewer would add between $20,000 to $25,000 to the value of my properties.
However, an amount of $93,263.28 in improvement taxes would be applied to the property, and were I to attempt to sell the properties now, I would have a net value of at least $68,263.28.
Realtors are also telling me that prospective buyers and investors are skeptical of investing in east side properties at this time because of the excessive amount of improvement tax that is possibly going to be applied, and because of the skepticism the negative impact would be greater than the $68,236.28, and that it very likely could be much greater.
The cost for me to service the $93,265.28 assessment debt load would amount to $6,885.76 per year, which is a massive amount to be forced to pay, especially when having to currently pay property taxes of $7,432.82 (2010 property taxes), in short, a total of $14,318.58 per year, very close to double the tax now being paid. On top of this staggering amount, we still have to add the cost of the hook up of the services.
Further, in discussions I have had with town officials, they were quick to point out the potential increase of property values due to the proposed new services. The bottom line here is that an increase of property value increases the property tax roll, meaning even more taxes to pay.
My tenants have already informed me that, because of having to operate in the current sluggish market they would be unable to meet their proportionate amount of the combined taxes, and would seek facilities elsewhere.
It is highly unlikely that there would be other people out there that would be willing to rent space at a rate that would allow the tax debt to be serviced. Without the income from the tenants, I would have no means to meet my annual taxes.
This same scenario is likely to apply to many of the other locally owned small businesses on the east side as well, since they are all struggling to survive in our lagging economy, and particularly so to those that own the property that they are operating a business from. There are property owners that will have over twice my assessment amount assessed against their property.
The ramifications of the east side services really scare me. I have little doubt that this project is about to destroy everything that I have accomplished in this town.
What I find frightening, is that the fact that the cost figures for the project are only projected costs. What happens if the costs are higher? Are we, as east side property owners going to be assessed even more?
Personally, I have worked long and hard to set myself up with a retirement fund that would allow me to live the rest of my life in a suitable manner without dependency on the pittance that our governments offer to retirees. I would like to have guarantees that these cost are not going to be higher, and better still that they would be substantially lower.
I hope that the members of the town council are aware that the criteria pertaining to the operation of a small local business is a very delicate balance, and a tax burden of this magnitude would have a devastating effect on them, causing them to move to more affordable accommodations or close their doors.
Council members must realize that impact of the issues that I have outlined concerning this proposal will be more than doubled for others on the east side.
I feel that it is important to provide water and sewer to the east side, however the cost to the commercial property owners must be lowered to a level that allows the tax burden to be met without causing hardship to those who have to pay.
It is my understanding that the Town of Sundre has deemed the petition that was presented as invalid. I must remind council, that, while there are possibly some technicalities involving some of the addresses in the petition that was presented, there are enough people telling you that the excessively high cost of the project is unacceptable and that more accountability is required.
We are not multi-million dollar companies with a vault full of money, but for the most part we are ordinary people trying to eke out a suitable living for ourselves and our families in a community with a small trade area.
I now have to plead to the members of the town council to table this project until an equitable solution can be found.
If you have any comments to me or questions to ask of me, I may be reached at 403-638-3694.
Thank you
Ken Guenther,
Sundre Tire Ltd.
