On Aug. 10, city council passed a motion 9-4, still to be ratified on Aug. 24, endorsing the financing and tendering of a multi-use indoor turf facility, supported by administrative work showing a break-even or small surplus position on the annual operating budget for the facility.
I appreciate that the scale of this project has raised some questions in the community.
First I want to address the tax implications. I, and others, ran on keeping taxes as low as possible and to this point, through two budgets, I feel we have done a reasonable job.
Since the beginning of our mandate, council has established a reserve fund of approximately $15 million dollars dedicated to the multi-use facility. Seven million dollars of that is from the federal government’s Gas Tax Program. The remainder is from other reserves, and the new Municipal Accommodation Tax (MAT) on hotel stays, a new revenue stream for the city that at this point totals $1.17 million, with more to come, to be applied to this project.
This means that at this point the combination of federal funding and MAT funding represents almost 25% of the project’s estimated costs. This $15 million will not lead to any new tax implications on a go forward basis for Thunder Bay businesses and homeowners.
The balance of the estimated cost, as contained in the motion passed at council, is to be financed through a debenture. There are many good reasons for financing large capital projects through long-term borrowing, which the city does every year, including leaving capacity for other capital projects, minimizing the near term impact of the project on current taxpayers and spreading the cost of the project over 25 years, allowing for future taxpayers and users to also pay for the facility.
The debenture, and its cost to taxpayers, will not come onto the city’s books until the completion of the two year construction project, which is estimated to be near the end of 2022 or early 2023.
While under construction, the project will be financed through Infrastructure Ontario. The estimated cost to the city will be $55,000 in 2021 and $234,000 in 2022. As a result, the expected tax implication for Thunder Bay taxpayers in the first two years will be approximately $300,000.
If the debenture has not been reduced within that two years through decisions of council, or successful application to federal/provincial funding streams, the cost to the median household in Thunder Bay will be $20 per year over 25 years. Again, that will not happen for two years.
The argument has been made that to go out for bid now prevents us from receiving future funding from the federal or provincial governments to put towards the project. That rule does apply to the ICIP program currently in place at the federal level, but there may be other opportunities to apply for funding for this project, and other infrastructure priorities that the city has.
The process described above may provide opportunity over two years for council to apply for other government funding and, if successful, apply it to and reduce the debenture, reducing the cost of the project, or to other projects as council determines.
Our announcement last week that the city had received $9.4 million jointly from the federal/provincial governments to deal with COVID-19 operating pressures for 2020 (currently projecting a $7 million shortfall) has greatly enhanced our fiscal position, understanding that challenges remain for 2021. To delay this project any further will add cost (the Stantec report from 2018 for a similar facility was $25 million, $8 million less) and potentially stall the project indefinitely.
To close, I want the citizens of Thunder Bay to know that my decision related to moving forward on the multi turf facility at this time was not something I’ve taken lightly. I see the facility, which the previous council listed as a priority need, as one that can be transformational in helping us build, and grow, a healthier and more vibrant community while we move to recover from the pandemic. Thank you.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
