Mayne Island Residents and Ratepayers Association February 2011 Newsletter

Fire Hall Referendum Special Issue

Greetings MIRRA Members,

As you are no doubt aware, The Mayne Island Improvement District has scheduled a referendum for March 12th to borrow up to $3,400,000 to build a new fire hall. MIRRA was founded to interact with the various levels of gov- ernment over such issues on behalf of residents and ratepayers. Besides a monthly executive meeting, the direc- tors are in regular contact with each other, sharing information and considering responses to a range of situations. MIRRA may sponsor a single-issue forum, lobby for attention to a pressing need, and update the member- ship and the community at large through a newsletter or submission to the Mayneliner. The Board operates mostly by consensus, and feels it has a sense of the membership from emails, phone calls, and regular encounters in the community.

We are writing this because a member has protested not being informed that the directors have decided to take on the “NO” Committee function in the fire hall referendum process. Information became available to us in its own time, and deadlines for applying for committee status with the referendum Returning Officer made it impractical to call a special general meeting to consider the position. We assumed the underlying reason to take this action was embodied in MIRRA’s constitution (MIRRA’s purposes, actually our constitution, are printed on the reverse of your membership card).

MIRRA was contacted by member Doug McNeill with a proposal to review his analysis of the fire hall project and referendum question to borrow up to 3.4 million dollars. We found it a persuasive argument that the Improvement District’s proposal needs serious re-thinking, and include it here, along with MIRRA’s recommendation to vote NO on the referendum question, both submitted to the February Mayneliner. Both documents make the case for build- ing and funding a new fire hall without an unnecessarily high tax burden on the community over twenty years.

The No Committee mailed over 1,000 copies of the two letters to off-island property owners who might not see them in the Mayneliner. We felt they deserved information to help them make an informed decision in this referendum. Costs of the mail-out were covered by membership fees ($10/individual) and generous donations. If you would like to support these activities, please consider renewing your membership, due as of the October 2010 AGM. Donations may be made to Mayne Island Residents and Ratepayers Association. As we are not a registered charitable society, we do not issue tax receipts.

The invitation is extended once again to members to communicate with us, either in person, or via mayneratepayers@shaw.ca and to consider joining the board. Our mailing address is MIRRA, S1 – C55, Mayne, BC, V0N2J0

Sincerely,

Mayne Island Residents and Ratepayers Association Board of Directors:

Dave Lindquist
Colleen Ming
Wayne Ming
Barry Wilks
Bob McKinnon

Mayne Island Residents and Ratepayers Association and the 3.4 million dollar Fire Hall Referendum

Tax increases are never popular, most especially during times of economic uncertainty. But sometimes they are for a purpose that must be accomplished near term, and not put off. MIRRA is unaware of any serious opposition to the need to replace the present fire hall with one that is disaster-proof.

The Fire Hall Task Force has produced a design to meet the requirements of the Fire Department and thus the disaster security needs of the community, but we think that the process employed did not give adequate consideration to more affordable alternative solutions, such as that put forth in Doug McNeill’s letter appearing elsewhere in this Mayneliner.

The maximum borrowing sum of $3,400,000 is calculated to provide a wooden building, being the recommendation of consultants retained by the Improvement District. Recent steel fire hall construction on Saturna has demonstrated that such projects can be com- pleted for far less than the M.I. Improvement District is asking for. We are told that the decision on building type can be revisited, but doubt that there would be much incentive to do so if the maximum amount is approved. MIRRA arranged to have a representa- tive of a locally owned steel building company present cost information relevant to Mayne’s project. MIRRA is not an agent for any particular construction company, but we do appreciate the alternative information they have provided. In any case, the Im- provement District doesn’t seem much interested, but we suspect taxpayers will be.

At the recent Task Force information meeting, members of the public were clearly un- comfortable with being asked to approve a spending proposal without knowing in ad- vance whether they were to be billed by a parcel tax, or by a tax on assessment as rec- ommended by the Task Force. The parcel tax would impact every property equally, whereas a tax on assessment would see some taxpayers paying many times more (as much as $2,500 annually) than others for the same service. Handling this burden fairly need not involve punitively taxing owners of handed down family properties, some of whom are living in otherwise modest circumstances. And in the absence of a decision on taxation method, voters must assume the worst-case scenario.

In closing, MIRRA reminds referendum voters that the present proposal represents a 20 year funding commitment at a time when economic trends are dubious and financial stresses may not have yet peaked. It behooves all levels of government to manage ex- penditures prudently, and with obligatory care towards the people they serve. If the new Fire Hall requires another go-round, hopefully the next Task Force’s revised terms of reference will make a higher priority of the interests of Mayne Island taxpayers.

While understanding that delaying a new Fire Hall is a major disappointment within the community, we recommend a NO vote on this 3.4 million dollar question.

Date: February 2011
To: Mayne Island Voters
From: Doug McNeill
Subject: Mayne Island Fire Hall Referendum March 12, 2011

The Fire Hall referendum asks if we agree to spend up to $3,400,000 for a new Fire Hall. Payable over 20 years. I am not a fan of long term debt. Subscribing to long term debt would encourage me to overspend. I find ‘living within my means’ to be far more palatable. The concept of ‘living within your means’ is very simple.

A) Buy only what you need.
B) Pay for it.
C) If you can’t pay for it now, but definitely need it now, plan to retire the debt as soon as possible.

A small group of Islanders undertaking a $3,400,000 debt is a heavy load. It becomes $5,654,376 over the 20 years. That looks to me like too large a request for our small community. That is certainly “all our eggs in one basket” for a very long time. What about our other community funded needs?

I had heard of the new Saturna Island Fire Hall. What I found difficult to understand is how Saturna Island built their Fire Hall for about ONE THIRD of what we are being asked to spend.

I took it upon myself to delve into this issue.

I had become aware of Permasteel, the firm that built the new Saturna Island Fire Hall. Saturna wrote a very strong letter of recommendation discussing their contract with Permasteel. Saturna’s Fire Hall came in at $1,200,000. Some land costs are included in this figure. The contract was for two buildings, collectively 9,100 sq. ft.

I wanted to get a second opinion of Permasteel. I found another Permasteel Fire Hall on the mainland, so off I went to pay them a visit. I met with the Fire Chief. I didn’t discuss costs because he revealed that the building was 13 years old. He also mentioned that it tested well in a recent municipal building survey. In summary he said “It suits the purpose”. That says it all for me: “SUITS THE PURPOSE” can be added to “AFFORDABILITY” as criteria for our Fire Hall.

Permasteel has been building steel structures for 57 years. All types of steel buildings. They are leaders in the field. Vancouver based. They have an impressive portfolio. The Garrison Curling Club in Calgary impressed me. Quite a fashionable social component adjacent to the large ice surface. I was also impressed with the fact that Shell Oil chose a Permasteel building to house their corporate airplanes, complete with executive offices, departure lounge etc.

PERMASTEEL HAS BUILT MANY FIRE HALLS.

I called Permasteel. I made it clear that I was calling on a personal basis. They have been here on Mayne and have seen our Fire Hall plans. They couldn’t discuss costs with me, as I well understood, however they told me that their common experience for similar structures was about $175/sq.ft.

I needed to see the MIID Fire Hall plans again. Yes, the plans looked well beyond “Suits the purpose” to me. The ceiling is supported by glue – laminated beams, framed by a surround of many sky lights. Could that ceiling be any more expensive? I think it could be reasonably assumed that the entire building is designed to that standard. A long way from my “Suits the purpose” criteria .

Total Cost Total Sq. Ft. $ Per Sq. Ft.
Saturna Fire Hall $1,200,000 9,100 $132.00
Permasteel Fire Hall Common Experience $175.00
Mayne Island Proposed Fire Hall $3,638,000 9,778 $372.00

I have prepared this basic cost comparison for your review.

MIID Permasteel
Budget $3,638,000 $2,200,000
Reserves ($237,000) ($237,000)
Balance $3,401,000 $1,963,000
Loan principal $3,400,000 $1,963,000
Interest 5% 5%
Years 20 9
Monthly $22,438 $22,608
Yearly $269,256 $271,296
Times years $5,385,120 $2,441,664
5% collection fee $269,256 $122,083
Grand total $5,654,376 $2,563,747
Debt avoided $3,090,629

The MIID column is the proposed Fire Hall. The Permasteel column represents my “Suits the purpose” Fire Hall. The budget figure I have used in the Permasteel column is $2,200,000. I have arrived at this number with the fol- lowing in mind.

$2,200,000 is twice the cost of the Saturna Fire Hall. The slightly smaller structure, and exclusion of their land costs, makes this comparison equitable.

$2,200,000 builds in a 29% reserve from Permasteel’s common experience. This is $225/sq.ft., up from $175/sq.ft.

Interesting numbers.

SAME REPAYMENT SCHEDULE DEBT FREE IN 9 YEARS. AVOIDED $3,000,000 OF DEBT.

THREE MILLION DOLLARS LESS. THAT’S WHAT “LIVING WITHIN OUR MEANS” LOOKS LIKE.

Here are six very important things to keep in mind.

The fire department needs a new building. Lots of room to park the trucks, firefighting gear, firefighting equipment, administration offices, storage, training facilities, etc.

It is the Mayne Island taxpayer’s responsibility to provide the firefighters with this facility. It must be affordable. It can’t tie us up for too long because there are other community needs worthy of our support. The principle need of the structure is to keep gear and trucks dry, and at the ready. An industrial steel building, “Suits the purpose”.

The question on the referendum is very straight forward. “Do you approve the borrowing of UP TO $3,400,000 for the New Fire Hall?” Yes or no. KEEP YOUR EYE ON THE END NUMBERS. $5,654,376 compared to $2,563,747. As you can see I’m a supporter of the “DOWN TO” position.

The only way back to the drawing board is for you to VOTE NO on March 12th.

Most Mayne Island voters live “Off Island”. They are hard for me to reach. If you agree with my views expressed here, please discuss this letter with them. Your weekender neighbours need this information to cast an informed vote. Mail in ballots should be out to them now so it is important to pass this information on promptly.

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