The Town of Petrolia is borrowing nearly a million dollars for the next 10 years to cover some capital projects.
The town will borrow $950,000 to pay for past road projects – mostly the reconstruction of Princess Street – and the new storage building for the Victoria Playhouse Petrolia.
Treasurer Rick Charlebois says the town was originally expecting to borrow just over $2 million for the roadwork, building and the replacement of some equipment in town. But when the time came to pay, administrators used cash which was already on hand, hoping to avoid paying interest.
When Petrolia was given a grants from the provincial and federal government to rebuild Petrolia Line for $4.5 million and to construct a new waste water treatment plant for $21 million, it had to come up with funds to pay it’s share of the work.
“Now with the other big projects coming on, we need cash to pay for the other projects,” Charlebois tells The Independent.
The bylaw for the $950,000 loan which council approved Monday shows $606,668 will go to help pay for the Princess Street road work, another $82,240 goes to pay for equipment upgrades and municipal buildings. $261,092 has been set aside to cover the costs of land – the town recently purchased a lot on Petrolia Line that is now being used by Birnam Construction.
The town negotiated the loan with the Ontario Infrastructure and Lands Corporation for the next 10 years.
The municipality will make semi annual payments until 2025 with an interest rate of 2.29 per cent. That’s about $118,325 in interest.