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March borrowing request city's largest
District Energy System vote marks first time all can vote in city referendum

Nicole Veerman
Northern News Services
Published Wednesday, February 23, 2011

SOMBA K'E/YELLOWKNIFE - It's been eight years since the city last held a referendum asking permission to borrow funds for a project. And none have asked for as large a dollar figure as what the city is proposing now for the downtown district energy system, said Debbie Gillard, city clerk.

NNSL photo/graphic

The last referendum held by the city was to ask permission to borrow money for the 2003 Road Rehabilitation and Paving Program. Pictured above is Darrell Gibson sweeping as Rusty Sandberg passes behind him on a roller during road construction work on Franklin Avenue in 2006. - NNSL file photo

Referendum information
The question:

Voters will be asked if they approve of the city enacting Bylaw No. 4620, a bylaw authorizing the city to acquire debt on, the security of which may be borrowed sums not exceeding $49 million, for the purpose of financing the city's capital investment in a district energy system.

Polling stations:

There are two polling stations for the referendum that will be open from 10 a.m. to 7 p.m. on March 14.

Residents residing in Great Slave, Weledeh and Yk Centre will vote at city hall

Residents residing in Frame Lake, Range Lake, Kam Lake and Yk South will vote at the Multiplex Gym

In the March 14 referendum, the city is asking permission to borrow up to $49 million for the project, which - if completed and if businesses sign on - could heat 39 downtown buildings with a mixture of wood-pellet boilers and geothermal heat generated by the earth beneath the now-defunct Con Mine.

In the last referendum, held in 2003, the city was looking for permission to borrow $1.5 million to finance the 2003 Road Rehabilitation and Paving Program.

NNSL examines the YK District Energy issue
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Only three per cent of ratepayers showed up to vote, with 89 people voting yes and 25 voting no.

Before that, in 2002, the city asked to borrow $1.65 million to complete phase one of the Twin Pad Arena - now called the Multiplex.

For that vote, there was an 11 per cent voter turnout, with 267 votes in favour of the city borrowing and 155 against.

The difference between the last two votes and the upcoming referendum is that the definition of an eligible voter has changed.

In April 2004, the territorial government amended its Cities, Towns, and Villages Act to allow voting rights to any Canadian citizen over the age of 18 who has lived in the city for 12 consecutive months before the vote. Before that, only ratepayers were allowed to vote.

Blake Lyons, a former city councillor, said the change is positive.

"It gives the right to exercise their vote to a lot more people, and of course some have a strong attachment to it because of the fact that it could affect their taxes, but the others have a strong attachment too because they may well want to stay here in Yellowknife and see the improvements."

The act legislates that the city has to hold a referendum in order to borrow funds, said Carl Bird, the city's director of corporate services.

According to the act's debt regulations, there are a few exceptions to that rule.

A municipality is exempt from voter approval if the justice minister finds the long-term debt is going toward something in the public interest, or toward something that is needed to improve or maintain public health, the environment or public safety. The city would also be exempt if the amount to be borrowed was less than $250,000.

If residents vote on March 14 in favour of the city borrowing up to $49 million, it doesn't mean borrowing will occur; it will just give the city permission to move forward with the project, and it will ensure a $14.1 million grant from the federal government for the geothermal portion of the project.

In order to receive the grant, the city needs to prove it has the funds to move ahead with the project by the end of March.

According to the city, borrowing $49 million is a worst-case scenario. The number could significantly decrease if the city chooses a private sector partner.

At a committee meeting Feb. 7, Bob Long, the city's senior administrative officer, said three possible partners - who haven't yet been named by the city, as they are requesting anonymity until negotiations finish - have come forward and all three are "more than willing and enthusiastic to take an equity position."

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