Review Criteria used to Establish Municipal Long Term Debt Limit

Year: 2012


Whereas many urban governments have reached their debt limit due to investing in infrastructure needed to facilitate growth within their communities; and Whereas the long term debt limits are prohibiting many urban governments from addressing other critical needs, thereby creating a barrier to further growth; and Whereas the criteria used to establish these debt limits does not take into consideration that utility debt is funded by consumer’s utility charges, not property taxes.; Therefore be it resolved that the SUMA work with the Ministry of Municipal Affairs to initiate a review of the criteria used to establish long term debt limits to ensure applicability to urban governments today.

Provincial Response

Government welcomes the opportunity to participate in research and discussions regarding municipal debt limits to ensure municipalities are positioned financially to meet infrastructure needs and engage in asset management to respond to the growing provincial economy. All jurisdictions across Canada have oversight or approval requirements related to municipal borrowing. Governments have a responsibility to ensure ratrepayers are protected from the possibility of municipalities taking on debt they are incapable of managing. Given the Saskatchewan Municipal Board's fundamental role in monitoring municipal capacity and risk, it may be useful at some point to include them in the debit limit discussion.

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