The Comox Valley campus of North Island Hospital. File photo

The Comox Valley campus of North Island Hospital. File photo

Comox-Strathcona still on track to pay down new hospital debt

Reserves for capital projects should increase over annual debt in 2023-24

The administrative body that oversees local capital contributions for hospitals on the north part of the Island is raising surplus funds while paying off debt for the two new facilities over a 10-year-term.

Some, though, are suggesting the Comox Strathcona Regional Hospital District should consider paying down the debt early.

The CSRHD raises roughly $17 million each year through tax requisitions in the Comox Valley and Strathcona regional districts. At the most recent board meeting, staff provided the board, comprised of local government representatives from the two regions, with an update on the plan to pay down the debt on the two North Island Hospital campuses in Campbell River and Courtenay. Due to COVID-19 delays to meetings earlier this year, the news, along with an audit report, came a little later than expected.

“Typically, you would receive these in the spring,” corporate financial officer Myriah Foort told the board in September. “This is really wrapping up last year’s financial statements.”

She outlined how the regions were able to take advantage of strong reserve funding and low-interest rates to pay down more debt and also reduce the term of the debt, from 20 years to 10.

“It left us in a very good position,” she said.

At present, the term ends in 2028, with an interest rate set at 3.2 per cent. The leaves CSRHD with annual debt servicing of about $10.7 million. Of this, about $7.9 million covers debt principal with $2.9 million is for interest each year.

Of the annual tax requisition of $17 million, CSRHD transfers about $5 million into reserves, which could cover future capital projects. As Foort indicated, over the 10-year term, the amount going to reserves will intersect and start to increase over the debt amount in 2023-2024.

Edwin Grieve, one of the Comox Valley directors, asked where the reserves are being held. Foort confirmed these are with the Municipal Finance Authority of BC, which provides financing for local governments in the province, typically offering low-cost financing to them.

Several board directors were pleased to hear the organization was on track in terms of debt for the North Island Hospitals.

“It’s encouraging to see our reserves in a very healthy, healthy place at this point, and then only increasing,” said Will Cole-Hamilton, a Courtenay representative.

However, Brenda Leigh, a director from the SRD, asked about the amount of debt payment, and suggested that before taking on more debt or more projects, CSRHD should pay down more debt, especially in the current economic circumstances.

“We should be looking at getting rid of that debt ASAP,” she said. “I don’t think interest rates are going to stay low forever.”

Leigh also veered into the topic of the organization possibly funding long-term care facilities in the future, to reduce demand on acute care facilities, a topic that was on the agenda at the same meeting.

RELATED STORY: Long-term care need pressuring acute care in Comox Valley, Strathcona

CSRHD board chair Charlie Cornfield said he appreciated her comments but that the topic will be discussed during strategic planning sessions, now set for spring.

Grieve also responded to the issue of funding and debt interest, saying through MFA, the low interest rate for borrowing for the hospitals is locked for the 10-year term, adding there is no advantage to paying it off early.

“This isn’t, you know, like a car payment or bank loan. It’s a little different,” he said. “There will be no change in the interest rate, and it’s fixed.”

RELATED STORY: Comox Strathcona Regional Hospital District looks for better return on tax funds

In recent years, a dilemma for the board in terms of its tax requisition amount has been whether to keep it at $17 million a year to generate surplus funding for the future or reduce the total to $15 million for area ratepayers for a tax reduction.

Like us on Facebook and follow us on Twitter.


Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

The Vancouver Island marmot is an endangered species. Pictured here, a marmot at Mount Washington. (Black Press file)
VIDEO: ‘Frisky’ Vancouver Island marmots caught on camera

Marmots are catching the eye of researchers when caught on security cameras getting ‘quite frisky’

Karilyn, right, with her older sister, Sabrina. Both siblings are members of the YANA family, after being helped by the community organization on separate occasions. Photo supplied
Siblings both members of the YANA family

Comox Valley non-profit helped Geiger family on separate occasions

A second-floor balcony continues to smoulder after a fire extinguisher was used to get a small balcony fire under control at the Washington Inn Apartments. Brian Hayward, who lives on the third floor, was alerted to the fire by the smell of smoke wafting into his apartment. Photo by Brian Hayward.
Courtenay firefighters respond to balcony fire at Washington Inn Apartments

Firefighters were called out to the Washington Inn Apartments Sunday, April 17,… Continue reading

RCMP forensics investigators scour the site north of Highland School in Comox, where multiple people were stabbed during a party Saturday night, April 16. Photo by Terry Farrell
UPDATED: Multiple stabbings at Comox bush party

Three youths hospitalized after an assault near Highland Secondary

Cumberland is surrounded by trees — and logging. Its council is supporting a call to stop old-growth logging in vulnerable areas of the province such as Fairy Creek. Photo by Mike Chouinard
Cumberland backs request to save B.C.’s old-growth forests

The Comox Youth Climate Council is asking local governments to take stand

In this image from NASA, NASA’s experimental Mars helicopter Ingenuity lands on the surface of Mars Monday, April 19, 2021. The little 4-pound helicopter rose from the dusty red surface into the thin Martian air Monday, achieving the first powered, controlled flight on another planet. (NASA via AP)
VIDEO: NASA’s Mars helicopter takes flight, 1st for another planet

The $85 million helicopter demo was considered high risk, yet high reward

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

The following is a list of restaurants offering take-out and patio dining. ADOBE STOCK IMAGE
List of Comox Valley restaurants offering take-out, patio dining options

Restaurants in the Comox Valley continue to adapt to government-imposed restrictions in… Continue reading

Families of two of three workers killed in a train derailment near Field, B.C., in 2019 have filed lawsuits accusing Canadian Pacific of gross negligence. The derailment sent 99 grain cars and two locomotives off the tracks. THE CANADIAN PRESS/Jeff McIntosh
Families of workers killed in Field train derailment allege negligence in lawsuit

Lawsuits allege the workers weren’t provided a safe work environment

(New Westminster Police)
4 youth arrested after 30-person brawl in New Westminster leaves 1 seriously injured

Police are looking for witnesses who saw the incident take place

South Surrey’s Paul Cottrell, who works with the DFO, tows a grey whale out of Semiahmoo Bay Sunday. (Contributed photo)
Dead whale floating near White Rock towed to shore for necropsy

Animal has been dead since at least April 15

Wickaninnish (Clifford Atleo) plays the drum while singing the Nuu-chah-nulth song on the court steps in Vancouver In a picture from April 2018. Photo credit, Melody Charlie.
Five western Vancouver Island First Nations celebrate legal fishing victory

Court ruling confirms Nuu-chah-nulth fishing rights in case dating back to 2003

Sunday’s storm rocked one of the ferries crossing Kootenay Lake. Photo: Dirk Jonker
VIDEO: Storm makes for wild ferry ride across Kootenay Lake

The video was captured by ferry employee Dirk Jonker

Dr. Bonnie Henry gives her daily media briefing regarding Covid-19 for the province of British Columbia in Victoria, B.C, Monday, December 7, 2020. THE CANADIAN PRESS/Jonathan Hayward
Toddler marks youngest British Columbian to die related to COVID-19

Child one of eight people to die from virus this weekend

Most Read