(Copyright The Kingston Whig-Standard 2006)
If Kingston politicians raid savings to build a $37-million entertainment centre, they'll be spending money in a way it was not intended to be used, says a former mayor.
Kingston politicians are poised to withdraw $3.3 million from a fund created seven years ago and built on tax dollars.
"That certainly wasn't the original intent of the fund," said Gary Bennett, who was mayor in 1999 and who was one of the architects of the one-per-cent-a-year solution.
That year, councillors took the unprecedented step of establishing an automatic, annual property tax hike that would bankroll repairs to the city's crumbling roads and other infrastructure.
"It's like anyone's savings account; if you keep dipping into it, you compromise the ability of the fund to really achieve what it was originally established to do," said Bennett, who was mayor of Kingston for six years, from 1994 to 2000.
The fund was established to help address a crisis of civic decay, a backlog estimated to be worth half a billion dollars, for which the city had no savings.
Bennett said the money was earmarked to fix critical big-ticket items, such as crumbling roads and bridges.
"I think [current councillors] need to reflect on the backlog rather than using it for essentially an opportunity or viewing it as essentially a piggybank," he said in an interview. "It wasn't meant to be viewed as a piggybank that could be used for council's current- day priorities."
Six current politicians, including Mayor Harvey Rosen, were part of the 16-member council that created the fund.
Rosen was a member of the city's now-defunct executive board of control at the time.
"I would be surprised if Gary thought that this was not an appropriate use of funds in the current circumstances," said Rosen, who supported the fund's creation in 1999.
He said it's up to the current council to be creative about how to pay for priorities.
Leonore Foster, who also sat on council in 1999, said she doesn't see a problem with using some reserve-fund money to build the entertainment centre.
Bennett said at the time the fund was created, there was discussion about whether the politicians could impose rules for the money's use on future councils. In the end, no attempt was made to impose limits on how the cash could be spent.
"What future councils did is really their decision," he said. "You can't really tie their hands."
City budget chief Gerard Hunt has said the money in the fund, $12.7 million at the beginning of this year, can be spent on almost anything politicians choose.
Using the money to bankroll new projects wasn't part of the policy debate, Bennett recalls.
"It wasn't part of the original discussion nor, I believe, was it part of the original intent," he said.
Rosen noted that when federal income tax was first introduced it wasn't intended to address all of the issues the money is now used to fund.
"Times change, things move along," Rosen said. "Needs change as the community develops."
The idea for the fund arose during budget talks in 1999, when then-chief administrator Bert Meunier warned that the city had a growing backlog of crumbling streets, pipes, buildings and other assets.
The politicians blamed past councils for resisting tax hikes that could have been used to save for the big-ticket needs.
Bennett pressed councillors to adopt Meunier's plan. In the end, the politicians didn't go far enough.
They decided to hike taxes slowly, imposing the one-per-cent-a- year plan, and increase borrowing.
"I think this is too low," Meunier cautioned at the time.
The hike has been an invisible component of property tax bills every year since and will bring the city an expected $8.8 million this year.
The levy is expected to raise more than $10 million next year and, in 10 years, it should be worth more than $21 million.
Decay continues to outstrip spending.
Over the next 10 years, the city has planned to spend more than $840 million on municipal and utilities-related capital projects. It isn't enough to keep pace, politicians were warned during budget talks last year.
The cost of replacing and repairing roads, parks, buildings and other infrastructure would add up to $250 million more to spending plans.
Unmet utilities needs will add millions more in costs, at a time when many ratepayers have been stung by spiralling charges for water and sewer services, which are in addition to tax hikes.
Customers in the city core, for instance, have seen their sewer charges soar by 86 per cent since 1998.
The entertainment centre business plan suggests pulling $3.3 million from the municipal capital reserve fund, as it is now known, to help pay for the facility.
"I don't think we ever envisioned adding to the list," Bennett said. "I think we felt the list was ambitious enough without adding new infrastructure projects or pet projects, whatever you want to call them."
Rosen said he's not aware that any formal list ever existed.
The entertainment centre was a key plank in Mayor Rosen's 2003 election platform.
He promised to do something about the shabby, half-century-old Memorial Centre.
Rosen appointed a task force of prominent citizens and one politician to study the issue. They recommended building a marquee arena and entertainment centre to replace the old rink.
A business plan developed by the city's entertainment centre project director targeted the reserve fund as a cash source for the project.
A majority of councillors, in approving the entertainment centre project in principle, have endorsed the plan to raid the reserve fund.
"I'm cautious about it," said Councillor Beth Pater.
Bennett has been watching to see what is done with the special pot of cash he helped create.
"I've noticed over the last few years that [councillors] have been drawing funds out of there for a variety of purposes," he said.
Bennett said he believes that creating the fund was pro-active and visionary, despite how the money is being spent today.
"The bottom line is, what councils do with those funds are council's decision and they're the ones that have to answer for it."
[Illustration] Photo: The Kingston Whig-Standard, file / Former Kingston mayor Gary Bennett, seen here shaking hands with current mayor Harvery Rosen in 2003, says the city's reserve fund was created to keep up with crumbling infrastructure, not to help pay for a new arena.; Graphic/ Diagram: (See hard copy for graphic).