Posted January 11, 2014
Whenever her management of the city is questioned, the Mayor resorts to the tiny upgrade of Guelph’s credit rating by Standard and Poors (S&P), one of the major financial reporting companies in the world.
Be reminded of the role played by this rating company in the financial collapse of 2008. It was one of the credit rating outfits that kept giving favourable credit ratings to such major financial Wall Street icons as Lehman Brothers. Lehman invested client’s money in the mortgage-backed securities debacle in which billions were lost. And Lehman Brothers became history.
The city’s current S&P rating is purely based on the city’s ability to repay its debt.
It does not oversee or comment on the operations of the city, its management or “investment” policies. So it is a minor measure in assessing the true and actual picture of city operations and financial management.
In short the Mayor keeps hiding behind this privately-generated rating to excuse her failure to manage the city within our means. Remember, as the debt grew it placed demands on increasing revenue to pay for it. That’s why we have the explosive growth in property taxes and user fees, including water charges and development charges. No source of revenue was spared to feed the hungry tiger of excessive spending and growing debt.
The exponential increase in development charges is a major impediment for new businesses to establish in the city.
Examples include the indoor soccer stadium guarantees, the Waste Resource Innovation Centre, the Loretto convent conversion to a civic museum, legal fees, soaring staff compensation and numbers, the $750,000 time clock in the Sleeman Centre, the $2 million spent on the Stone Road bicycle lanes, the mysterious WellBeing program that leaves most people scratching their heads.
She cannot rely on Standard and Poors to protect her from the criticism of her stewardship.
When S & P was contacted to state its methodology for the Guelph rating, it declined.
This company has no comment about the huge increase in debt including the $53 million and still counting, investment in waste management, or to the upcoming $34 million for a new police headquarters.
Then there is Coun. Lise Burcher, a professor teaching landscaping at the University of Guelph. She is waxing enthusiastically about the proposal to tear down a viable strip mall and standalone veterinary clinic bordering on the river downtown and turn it into a riverside park. The staff’s estimated cost is $16 million. The councillor was so excited that she had her senior students take on the project of designing the park and study its impact on the community.
Do you believe Guelph has a shortage of riverside parks?
This proposal would destroy a valuable, established commercial development with an accompanying loss of property taxes. With thinking like this, it’s easy to understand why Guelph has failed to increase the commercial/industrial assessment ratio in seven years. It hasn’t changed from 16 per cent as compared to 84 per cent residential properties assessment since the Mayor was elected.
This results in a growing burden of increasing revenue that falls on the residential property owner.
And if you are wondering what the ratio should be so the tax burden is shared more equitably, try a minimum 40 per cent commercial/industrial and 60 per cent residential.
The magnitude of increasing the commercial/industrial assessment ratio is staggering. It will probably take years to accomplish and a massive effort to promote and open the city for business development.
This kind of growth will bring jobs, revenues, control spending and improve services
Not even Standard and Poors can influence this administration to change its propensity to spend your money on its pet projects, regardless of the costs or consequences.
That dog is off the porch. No matter what the Mayor says about her record, the consequences of her polices will not bring this Fido home.