Kimberley Mayor Don McCormick. Bulletin file

Kimberley Mayor Don McCormick. Bulletin file

Rising costs and interest rates hit budget planning with double whammy: Kimberley mayor

While the city of Kimberley waits to hear whether their grant application for the construction of the new waste water treatment plant was successful, work on the budget has to begin.

Kimberley City Council is now into budget deliberations and it’s not going to be easy.

“Every budget is difficult in its own way,” said Mayor Don McCormick. This year, with construction inflation and interests rates rising, it’s a double whammy.”

Previous goals of keeping to the two per cent municipal rate of inflation are out the window, he said, with the cost of everything skyrocketing.

“We’re seeing two hundred to three hundred per cent increases on the cost of goods.”

However, it’s not all bad news.

“We are fortunate that over the last ten years or so we have been diligent about building our reserves. We have strong reserves and we will lean on them. Of course, once you lean on them, you deplete them and they will have to be built back up again.”

But right now, the healthy reserve funds will help, he says.

As for the waste water treatment plan, it is in the city’s five year financial plan, and currently the plan is that most of the money would be spent in 2024 and 2025, assuming the grant news is positive.

Interim financing for the city borrowing is already in the plan.

“That’s the beauty of a five year plan,” McCormick said.

The grant announcement has no immediate affect on the 2023 budget, which is what Council will be getting specific with in the coming weeks.

McCormick also said sewage rates have been adjusted for the past four years or so to build up funds for operation of the new plant, whenever it comes online.

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