Incorporation: The Facts About Our Roads

The Final Incorporation Study Report repeats, at least eight times, that Salt Spring taxpayers put pay $90,000 more per year into the in Provincial Rural Taxes than they get back in road works. How accurate is this?

The report estimates that an average of $1,360,000 was spent annually in routine maintenance in recent years, or $5,100 per km. This closely matches MOTI’s reported average maintenance cost of $5,000 per km for all B.C. public roads. Since maintenance services were privatized in 2001, MOTI can’t find out what SSI road maintenance costs, because road-contractor’s books are closed to public scrutiny. Also, our road contractor, Mainroad, shuffles equipment and personnel within its South Coast contract area, making an inseparable mix of those monies spent. Thus, MOTI applied the B.C. average, as the most certain figure they have.

For all road works beyond this regular maintenance, the report says that MOTI spent about $500,000 annually over the last 15 or so years. This number came from an unnamed ministry contact. It wasn’t based on MOTI’s own, incomplete financial figures, which I obtained through 13 Freedom of Information requests made between 2013 and 2016 (15 total to date) and immediately shared with the Incorporation Study Committee, hence Urban Systema. These partial figures add up to $630,000 average per year (in 2016 dollars) since 2002. Add in low-balled estimates of missing data like the Walker’s Hook and North Beach Road washout repairs, plus unbilled MOTI’s expertise worth 30% of the total – Urban Systems’ recommended amount – the average total rises to over $900,000 per year, i.e. $400,000 more per year than the report estimates.

The total costs for all SSI road works since 2002, according to the report, averaged $1,860,000 per year, or about $7,000 per km. It projects that this figure, in constant 2016 dollars, will stay the same over the next 10 years. But wait, there’s more.

The report goes on to project that a municipality would spend another $324,000 per year for "engineering staff to work on transportation infrastructure and stormwater management", essentially to cover road-works expertise currently provided by MOTI. The report didn’t add a realistic part of this to the $1,860,000, rather left readers to add this up for themselves and realize that the island must have gotten more in road works than was paid in rural property taxes in recent years.

So there you have it: by the report’s own accounting, the $90,000 Rural Taxes overpayment compared to road-works received doesn’t hold. If, say, $250,000 of the $324,000 went to road-works expertise then total road costs would be nearly $8,000 per km. Or using Urban Systems’ own 30% estimate of funds needed for engineering and other expertise above basic road-works costs, the cost rises to over $9,100 per km.

Since MOTI’s accounting is incomplete and parts are unknowable, the best estimate we can find of the potential real road costs on Salt Spring is Bowen Island’s known projected costs. Their terrain and climate are similar, as is the condition of their road network and planned upkeep. They’ve budgeted about $16,300 per km over the next five years, which includes a roads reserve fund to cover on-going and extraordinary costs. The SSI Incorporation Study Report doesn’t provide this “apples to apples” comparison, despite being pressed by some Incorporation Study Committee members to do so.

Which is it then? $7,000 per km, ignoring the expertise that MOTI currently provides for free? Or $8,000 per km, factoring in $250,000 per year for such expertise? Or $9,100, factoring in the report’s own 30% figure for this expertise? Or closer to Bowen’s $16,300 per km to cover all costs and eventualities, including a necessary roads reserve fund? Note: MOTI is Salt Spring’s de facto road-reserve fund now.

If we don’t incorporate, the $268 paid per year in B.C. Rural Property Tax on a $480,000 residential property will remain relatively steady, whatever SSI road costs. If we do incorporate, a realistic $16,300 per km in road-works costs will add $596 to SSI property taxes, or $328 more than at present. Add another $148 per year for every $1,000,000 extra spent annually to cover capital works beyond this basic amount.

Road-works costs figure significantly into how many SSI voters cast their ballots in the incorporation referendum. We needed better figures in the Incorporation Study Report than $7,000 km, or an implied $8,000, or possibly $9,100, and we really needed the Bowen comparison of $16,300 per km. It’s hard to be confident in the affordability of incorporation when so much regarding road-works costs is missing and misleading.

Brenda Guiled

 

August 17, 2017 11:06 AM