The YMCA – What Council Didn’t Hear

Before Council heard a motion and voted to cease progress on the YMCA project, Fred Thiessen intended to appear as a delegation. His presentation, the second he would have given to Council on the issue, appears below in its entirety.

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YMCA Presentation to Council – April 8th, 2013

Mr. Mayor, Councillors and members of the Public…thank you for allowing us to address you for a second time on the issue of the YMCA.

Our motivation for speaking to you for a second time was to refute some of the statements made by the YMCA, and also summarize for you, the reaction that Abbotsford citizens have communicated to us in these intervening weeks.

However, since we last spoke, some things have changed greatly with respect to our city finances.

In our first presentation, we urged caution with Abbotsford citizen’s money. We spoke about how fickle Council seemed to be with spending priorities. First of all we are told our city will become a ghost town if we don’t build a new water source. Six months later we can spend our last dollar on yet more recreation facilities. While our objection to this irresponsible financial management continues, we now see you are ready to commit to spending another $8.3 million on the Vye Road Overpass. This is not in your budget. It does not appear in any financial presentation to Council and it will result, directly, in another tax increase for Abbotsford property owners.

Councillors, you have only $12 million in your Capital Reserve account as reported to you by the Finance Department on December 3rd, 2012. In that same report, it shows the effect of funding the YMCA and the only path to recovery is a Capital Levy. Call it what you will, that is a tax increase. We don’t have the money for the YMCA and the Vye Rd Overpass. That’s a $25 million spending commitment and we still don’t have clear answers if or when we need a new source of water. If water is a priority, and surely it must be, then the spending facing Abbotsford could be in excess of $300 million and we have less than 5% of that total. And what about the James Sewer Treatment Plant? And what about roadwork, infrastructure upgrades and maintenance? What is your plan? Councillor Smith said during the budget debate the mandated 5 yr financial plan was a meaningless document! Maybe we need the Auditor General to come and audit your 5 yr plan.

So, what is your plan? I’ll answer that for you. I don’t think you have one.

It seems like you have no idea how you’re going to pay for anything. Growth is slowing to a crawl in Abbotsford; your policies have slowed investment and business opportunities. Budgets are based on growth projections that we haven’t been able to meet for years and we just fall further and further behind.

You are probably going to do what every group of politicians is doing all around the world. You are going to continue to ignore basic fiscal management and you’ll keep on borrowing, spending and increasing taxes until one day you can’t.

Don’t think that the financial crisis is limited to Greece and Cyprus. Dozens of US cities are contemplating or are already in Bankruptcy. Stockton California is just the latest.

They have a $2 billion taxpayer liability and a population of 300,000 people.

Abbotsford has a little less than half the population and a total taxpayer liability of about $212 million. Sounds like we are in pretty good shape, but now add in the potential $300 million, plus interest, for the water source project. Add in the Vye Rd overpass. Add in the James Treatment plant. Add in the Abbotsford Heat and AESC losses for the next 20 years. You’ll see that our potential taxpayer liability could be close to $1 billion with just a few more poorly considered decisions 10 years ago no one would have predicted the financial crises all over the world. That’s not to say we will have one, but you definitely can’t say it’s out of the question. And virtually all of the crises are debt related.

So, what do your citizens think of this?

Perhaps you’ve seen our ads in the newspaper. Those ads have contained a list of businesses and individuals who are against this expenditure and they’re willing to say so publicly. Many more have signed our online petition. Thousands of dollars donated and hundreds of names coming together to tell you not to spend our money foolishly. It’s amazing how many people are just finding out about this. The message is loud and clear from the citizens of Abbotsford.

Now back to the YMCA…

You think you’re doing the community a service by exploring a potential “discount” on building this facility. On what facts do you base this assumption?

Daniel Ariely, a renowned Professor of Behavioural Economics at North Carolina University, has done extensive research on why governments keep spending money. It is because politicians are using intuition instead of facts.

You “feel” that it is a good deal, but we’ve shown you the true cost of this investment and there is no reasonable way the city should ever consider it in its current financial situation. Mathematics should be your guide … pure and simple… not an abstract idea that if it is on sale it must be a good thing. That is ridiculous. It is like buying a new car on sale but then not having the money to pay your mortgage or buy food. That analogy is exactly what you are doing here.

A real world example of this is that we heard the YMCA talk about how their facilities were instrumental in crime reduction in the neighbourhoods they occupy. How can a claim of this nature be taken seriously? There is no statistic, no fact, and no evidence for this statement. Crime is at an all-time low since the 1970’s and we have reached that level with no YMCA in town.

Surrey on the other hand, with their new YMCA, has their hands full with major incidents of gang violence

This morning I was interviewed on CBC Radio. John Wolger, in a taped statement, said the Y was supplying Abbotsford with $47M worth of services. Are you kidding? We give them the land, give them 50% of the capital cost and then pay them to use their facility, all for services they haven’t defined.

Our Parks and Recreation Department used the same language, but couldn’t decide if we needed a new facility or not. In one report, we didn’t need more pools. Then a much used, operating pool was closed rather than spend $70,000 to keep it open. A year later, a report with many unsubstantiated facts, outlines a complete 180 degree turn to support the giving of $17 million to a fitness facility. I believe our PRC budget is nearly 26% of our overall budget when all debt and responsibilities are factored in. Most cities are less than 15% and the next highest in the Lower Mainland is Burnaby at 17%. Some are less than 10%. It appears as what we really need a complete overhaul of the Parks and Recreation Department.

If you fund the YMCA with tax dollars you will be giving them an unfair and competitive advantage over our local businesses. It will take customers away from them. Our businesses are more than happy to compete for those customers, but on a level playing field. Taxpayers get no benefit from this subsidy because people will also stop using existing public facilities to go there. Revenue will decrease and subsequent shortfalls will result in increased property taxes in future years.

Plainly, giving the YMCA money for capital infrastructure is not allowed in the Community Charter. The Charter restricts this kind of aid to anyone engaged in a business activity. You can only give this money to the YMCA if they then offer their services to the community for free. As soon as they charge for their services, they are engaged in business activity and are considered as such. This precludes them from receiving any money for capital infrastructure.

The Charter is there to protect taxpayer’s money. We have shown you repeatedly that Abbotsford cannot afford this project without deferring or cutting needed capital works in other areas. Today we’ve outlined that you have no viable financial plan for the City and until you do, we ask that you stop wasting our money on non-essentials.

In 2006, we had a projected $4 million per year Property Tax surplus, and virtually no debt. If I had stood in front of council at that time and said “In 6 short years this City will have a debt of more than $200M, a white elephant of a sports complex that the public can’t use (unlike Langley and Chilliwack), property taxes will be up more than 40% and the City Council and Mayor want to give a private organization tens of millions of dollars to build a recreation facility”, you would have called me crazy, out of my mind.

At that time, when Vince Dimanno stood in front of you at a Public Meeting and told you the AESC could conceivably cost $250M at the end of the day, you laughed at him. Everyone now knows who was right and who was wrong.

A final note: a story broke in the media last week about MLA Mike De Jong being mixed up in this. There is a lot of speculation regarding government pressure on the different proponents of the former Hospital site to get behind the YMCA because it’s an “all or nothing” project. How devious is that? Tying badly needed senior care facilities to market housing and a fitness club! This morning I was interviewed on CBC radio. Why is a Vancouver radio station interested in this story? Until we have all the facts on why this facility is being so heavily promoted and pushed upon us, we call on our City Council to do the responsible thing. Last January, Councillor Smith said he couldn’t vote no because he had last voted yes. How ludicrous! If you’re in the wrong lane on the highway, you better turn around before you crash. Please make a motion to set aside the Memorandum of Understanding. Move to end this project. Let’s stop now and not rush into another failure for the City of Abbotsford. We simply can’t afford it.

Please accept this written copy of our Submission for the Record.

Thank you.