The Moose Jaw Municipal Airport Authority has asked city council for a second repayment extension to its line of credit (LOC) guarantee because it has run into a cashflow problem.
During its Oct. 24 regular meeting, council voted 6-1 to authorize city administration to craft an amending bylaw to extend the LOC repayment deadline to Dec. 31 as part of The Moose Jaw Municipal Airport Authority Guarantee Bylaw.
Coun. Dawn Luhning was opposed.
This is the first step council must take because city hall must advertise the notice of bylaw and then present it to council for official approval during the Nov. 14 meeting.
The original deadline to repay the revolving $1 million LOC had been April 30, but council approved the airport authority’s request on April 20 for a deadline of Oct. 31.
Making the amendment ensures the airport authority can continue to access funding for its $3.2-million runway capital upgrades program.
During a March 2021 meeting, council agreed to provide a financial guarantee to the authority to access a $1-million LOC from Jameson Gilroy and B&L Livestock Limited (JGL). The authority can use that money as cash flow during its runway and taxiway extension and rehabilitation project.
No money came from city coffers, but the $1 million did — briefly — count against the municipality’s debt amount.
Greg Simpson, board chair of the airport authority, recently sent city hall a letter about the situation. He explained that the Canada Revenue Agency (CRA) has caused a significant delay in providing the organization’s GST refund of $127,404.
The CRA first decided to audit the airport authority’s GST return, while it then decided to have the organization file a corporate return, he said. This was considered an “unprecedented request” because the organization has not had to file this particular file since it is a non-profit.
“We did receive our GST return last year, so we are perplexed by the new, unpredictable expectations from the CRA,” he remarked.
The airport authority re-seeded the venue’s grass during the third week of October and can now obtain total performance on the earthworks and electrical contracts, Simpson continued. It will have its final invoices and holdback paid the first week of November while using its bridge financing.
Once those cheques clear the bank, he planned to proceed with the final application for funds via the federal government’s Investing in Canada Infrastructure Program (ICIP), he added. He would also invoice the City of Moose Jaw with the remaining funds.
The next regular city council meeting is Monday, Nov. 14.
