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Nearly $400K in provincial funding to support new bus purchases, city says

The grant that the provincial program is offering is $172,850 per vehicle, for a total of $345,700, proportional to the average ridership from 2015 to 2021.
Money. File photo

The City of Moose Jaw plans to use nearly $400,000 in one-time funding from the provincial government to help upgrade two aging buses. 

The province contacted city hall in late December about a grant program from which the municipality could acquire money to address transit or housing needs, but the deadline to apply was Tuesday, Jan. 24, 2023, a city council report explained

During 2023 budget deliberations, city administration had identified two regular buses that had reached the end of their lifespans.

There was insufficient capital reserve money available to replace both vehicles — each had an estimated shortfall of over $200,000 — so administration recommended proceeding with the purchases by using an equal amount of money from the transit major equipment reserve — $100,000 for each bus — if provincial or federal funding could also be found.

“We didn’t want to essentially cripple the transit equipment reserve with future purchases … . The grant money would reduce that reserve drawdown and it would leave reserve dollars in place for future purchases,” Darrin Stephanson, director of public works, said during the meeting. 

“We have talked fairly extensively over the last few months on the increases broadly in equipment – and certainly that is in the transit areas as well – so we do have needs coming up. And, we would have funds available still then to address those needs in the next couple of years.”

The grant that the provincial program is offering is $172,850 per vehicle, for a total of $345,700, proportional to the average ridership from 2015 to 2021, the report said.

During its Jan. 23 regular meeting, council voted unanimously to authorize city hall’s application for the one-time public transit funding program 2022-23 for the purchase of two regular buses. 

Council also agreed to meet legislated standards, terms and conditions of the funding program, conduct an open tendering process for the bus purchases and fund the municipal share of the capital purchase.

The department of public works spoke with the department of planning and development and learned that the latter had no new identifiable housing projects that could be eligible under the program, which meant the bus application could proceed, said Stephanson.

This provincial funding will not be available in the 2024 budget year, but if council wanted, it could apply the money to the 2023 budget to reduce the overall mill rate by 1.04 per cent, he continued. However, doing that would mean the 2024 budget starts with an operating deficit of $345,700.

“Using this money for the capital equipment actually does benefit the operational budgets as the operational budgets incrementally … fund the capital reserve to replace the equipment,” Stephanson stated.

Each bus costs roughly $700,000, so the provincial funding would help offset the remaining $400,000 deficit, he said while responding to a council question. This means city hall would only have to draw down $25,000 and $50,000 per vehicle instead of the $100,000 approved in December. 

The next regular council meeting is Monday, Feb. 13. 

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