Swift Current City Council has approved a three month grace period for the payment of city taxes which traditionally come due on June 30.
During a special video council meeting on March 27, council unanimously approved a three-month grace period be put into place to extend the due date for property taxes from June 30 to September 30. Individuals and businesses taking advantage of this grace period will not be subject to late payment charges.
Additionally, council also temporarily suspended the late payment charges on outstanding utility accounts until September 30.
“We had heard from our business community that a lot of their businesses were either shut or going to be shut during this pandemic. And we also heard from the financial institutions they were looking to defer the mortgage payments, they were looking to definitely work with their customers, and we wanted to be able to do the same. And so in hearing that, what we’re providing is some sort of relief,” Mayor Denis Perrault said during a video press conference after the council meeting.
And while the three month property tax deferral is in place, individuals who can pay their taxes by the original deadline are encouraged to do so.
“We’re still encouraging all of our residents that if they do have the ability to pay it, please continue on because we’re not waving them we’re just deferring them. So at the end of this period you’d still be required to pay those amounts. So if you do have the ability to pay, please continue. But for those that don’t we’re hoping this offers you some form of relief.”
Individuals and businesses who are on a pre-authorized payment plan through the city are asked to express their desire to suspend their payments by calling 306-778-2731 or emailing email@example.com for assistance.
The City of Swift Current is also allowing utility customers to defer payments without penalty through to September 30.
“From our utility standpoint we will not be doing any disconnects, and we will not be chasing receivables or adding any interest. Now again, if you have the ability to pay you should because it’s a wave it’s a deferral. It’ll still be due at the end of this pandemic. We’re optimist that this pandemic we’re going to get through and we’re going to get back to the running of the City in the way that we were before. We’re hopeful and optimistic that it’s going to be sooner than later.”
“Although very difficult, we think this is our best tool that we have at our disposal to be able to offer to our businesses and our residents.”
As a result of the impact of COVID-19 on city cashflow and delayed tax collection, Council approved a temporary $5 million increase to the city’s operating line of credit.
In a report presented to council, the impacts of Covid-19 have been forecast to impact cash inflow in both the areas of decreased revenue from recreational and cultural events and facilities, along with a decrease in funds from utility and property tax payments.
“Under average conditions the City would receive approximately $4.6 million per month in revenue. Over the next three months revenue collections are forecasted between $2.8 million and $3.4 million per month,” the report states.
With the city needing approximately $3.5 million in each of the next three months to maintain city essential services and cover fixed costs, there is a forecasted shortfall of up to $10.5 million. This forecast does not include any capital spending but does include debt repayment, payroll, utility costs and other essential costs.
In order to cover this shortfall council approved a temporary increase in their operating line of credit by $5 million. Council unanimously approved the approval to increase the operating line of credit from $2 million to $7 million for up to one year.
“We’re anticipating the ability to pay it within the next year as opposed to going through the process of having a fixed payment plan. It’s my sincere hope that this is temporary, that this is short lived, and we will have this paid within 12 months,” Perrault said of the reason to finance this initiative through a line of credit.
And while the City is planning for a drop in revenue collection, they are also looking at measures to reduce expenditures in every department.
“Council and myself have tasked our CAO and his General Managers to look at all of our teams and all of the services that we’re able to offer here at the City, and they’re going through the process and they’re sharing that information with their teams as well, they’re going through the process of what does this look like for us moving forward? What are the things that are essential and critical and what are the things that we can possibly defer.”
There will also be an impact on municipal budgeted capital projects given their cashflow situation.
“Our City Admin teams are looking at all line items and all capital spend. They’re also looking at any tenders that we might have been looking at starting. Their advice to their teams is we will not be submitting any new tenders. We are going to look at what’s essential and what’s critical, and what are some things that we can defer. We definitely have items that we’re still going to continue on.”
Perrault said the city has been working diligently on planning, but things have been occurring quickly during this pandemic situation.
“Given that we’re still really only in week two and a half of this new reality, our teams are definitely looking at exactly what we can and we can’t do, and the things that are the must do’s and must haves.”
He noted that essential services like Light and Power, water, waste water, fire and police are all paid for by the City and there are not concerns over these mandatory and critical services. However, city teams are looking at all other areas and coming back with what plans will look like moving forward.
“At present we have not made any cuts yet, and we haven’t made any changes yet. Our teams are still working. Our teams are still understanding what this new reality looks like.”
Friday’s meeting was held via video conference and shared with the public on YouTube, as council was following the social distancing protocols in place in response to the Covid-19 pandemic. All seven members of City Council along with seven members from City Administration participated in the video conference. A total of 59 individuals live streamed the meeting.