City council has approved increasing the city’s line of credit to $25 million in response to COVID-19.
The city established a $12.5 million line of credit in 2016 that Mayor Gerald Aalbers says the city has never touched.
“We’ve never gone into that line of credit and we’re hoping, based on how the community is able to respond with their tax money and utility bills, we may not have to but we’re preparing for the worst case scenario.”
Normally, the money collected through property taxes and utility bills, which were originally due on July 10, would cover the costs for the city. The city has developed the Payment Option Relief Plan which allows city taxpayers the option to defer property tax payments to November 10 and utility payments to September 30. The deferment means they are no longer guaranteed that money and have the line of credit as a safety net.
“What we’re trying to do is make sure we have enough money in the bank account to pay the city’s bills for the 365 days that we’re incurring. We’re basically all right now but there is the potential to come into trouble in July which is why it brought forward now should bills and projects come in due before people pay their taxes.”
City staff made the recommendation to increase the line of credit instead of keeping it at the same amount to ensure the city has enough cash flow to continue services in the coming months.
“It was a concern and rather than be at the maximum line of credit and having some outstanding bills it was felt by administration to raise that amount.”
The city encourages residents and businesses who are able to pay their bills on July 10 if they are able.