by Richard Gleeson
Northern News Services

NNSL (Apr 22/98) - The river of block funding cash the city has been channelling into a fund for the twin-pad arena got dammed Monday.

Reviewing the city's financial statements for 1997, some aldermen took exception to an administration recommendation that $245,000 in block funding be transferred to the major community facility reserve.

"I have some concerns about that, particularly after the No vote and particularly after it looks like we've been padding this fund," said Ald. Cheryl Best.

Best was referring to last week's vote, in which ratepayers turned down city hall's request to borrow $2.8 million for the twin-pad arena.

The city has pumped $500,000 of block funding into the reserve each of the last seven years. This year the city added $1.3 million to the reserve, all from block funding.

Administration informed aldermen the money was left over because one project came in under budget and another, replacement of storm sewers and drains, had been deferred.

The sewer and drain project was postponed because engineers estimated it would cost three times what the city had budgeted.

"What am I missing? To me, this sounds like water and sewer infrastructure replacement money," said Ald. Peggy Near, wondering aloud why the money was not being transferred to the reserve devoted to those types of projects.

Near was told money for drain and storm sewer work comes out of the general capital reserve, the same fund used to pay for such things as road and side walk upgrading.

Mayor Dave Lovell noted there was another motivation for moving the money to the arena fund.

"There's a political reason for this," Lovell told the committee. "If we draw our block funding down to zero, it's less likely the territorial government won't reduce it the next year."

Acting city administrator Max Hall said it makes no difference where the money is kept, explaining: "Basically, the reserves are just a place to hold unexpended funds."

The committee is recommending council put the money into the general operating fund.