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John Luton’s Third Letter

[John Luton's response to my letter to the Times Colonist. Can't wait to reply been really busy]

Hi again Saren,

Just wanted to follow up on your letter to the editor.  I did some further checking into city hall and much of it has seismic reinforcement, including the newer section (the western, modernist piece), and around doorways.  Some more work is ongoing and as I noted, planning for further work is also in progress.  The third floor of the old city hall has been emptied (it used to house lots of heavy archival material) and can’t be occupied until it is seismically upgraded.

The Crystal Pool, again as I noted, will be replaced, and planning for that project is underway, but nothing current is being done because of it’s very limited life expectancy.  From an actuarial perspective (the callous assessment of risk to life and limb), the bridge and other buildings will have various exposures, but it should be remembered that the Point Ellice Bridge that collapsed in 1896 killed 56 people, and the exposure on the Johnson St. Bridge is no less problematic.  Those killed in that disaster were in a trolley car, and likewise, numbers of BC Transit buses cross the Johnson St. Bridge and many will be full during peak hours.

The economic exposure, although less of a human issue than threats posed to the safety of our citizens, is a signficant potential cost issue.  Failed businesses don’t pay taxes and to the extent we may be held negligent for a failure to remediate deteriorating infrastructure, we can be found liable for economic dislocation.  Experience from the Loma Prieta earthquake in California in 1989 is worth noting.  Subsequent studies indicated that there was a net positive benefit of investing in seismic upgrades and mitigation.

Finally, you raised the ability to pay and on that, we have unequivocal confirmation of our ability to pay.  While many people are concerned about the costs, the provincial inspector of municipalities, who have to sign off on municipal borrowing plans, approved  the loan and indicated that, as a corporate entity, we have the means to borrow as much as $350 million.  We won’t obviously be going there, but as a factor of our capacity, $42 million is pretty modest and the concerns of those who don’t like municipalities to spend money will be irrelevant to the objective tests of ability to pay mentioned in your letter.

In fact, had the borrowing been approved in the counter petition, the project would have had no impact on taxes.  The obligation to address the vulnerabilities of the bridge, however, remains, and we will have to ask by way of referendum consent to borrow for either a new bridge or for the significant costs of refurbishment.  If approval is not secured, we will have to dip into capital reserves and that will have an impact on taxes.  By way of comparison, Colwood will raise taxes by about 16% this year I think, so the objective ability to pay test has a great deal of latitude.  I don’t expect any of our project choices would have that kind of impact, but it is worth noting that with respect to the test of means you mentioned, we have no option to ignore our obligations to address the deficiences identified in our assessment reports.

Cheers.
John