Money doesn’t grow on trees. This is something the City of Meadow Lake knows all too well, as – in an effort to continue being able to enter into longterm debt contracts – city council recently adopted a bylaw to extend a temporary increase to the municipality’s overdraft limit. The decision was made at council’s regular meeting Sept. 8.
“The City of Meadow Lake had to increase its overdraft limit from $3 million to $4.5 million to ensure sufficient cash flow between payments and claims for the construction of the Co-op Centre,” explained Asma Qadri, the city’s director of finance, in her official recommendation to council. “The increase in the overdraft has resulted in increased interest expenses and this amount has been paid as incurred and shall be part of the operating budget expenses funded through the normal revenue streams.”
Originally, council intended for the increase to the overdraft limit to be in effect from Dec. 3, 2024 to Sept. 30 of this year. “As the debt limit increase approval from the Saskatchewan Municipal Board is pending, the city is unable currently to enter into long-term debt contracts and thus requires the continuation of the increase of its overdraft to remain at $4.5 million for another six months,” Qadri continued. The extended overdraft will serve as bridge financing for the city’s portion of the Co-op Centre construction costs. The bylaw was moved by councillor Marty Bishop and seconded by councillor Mauri Young, and, while council ultimately voted for its approval, councillor Conrad Read did raise a concern. “We’re asking to raise our debt limit without seeing financial statements,” Read said. “I would like administration to realize how serious this is. Read was referring to the fact, at the same meeting, council only just approved financial statements dating back to December 2024 and the fourth quarter of 2024. “Whatever effort can be made to bring us the financial statements in a more timely manner would be nice – it should be monthly,” Read added. “I know there were some extenuating circumstances with the move (from city hall to the Meadow Lake Co-op Centre) and whatnot, but we’re making a decision on something without seeing factual data.”
Bishop agreed with Read, but also wondered what kind of problems the city could face if council chose not to extend the overdraft increase. “We’re bringing a bylaw through to borrow funds to incur temporary debt – that’s what a line of credit is for – so, while I understand councillor Read’s concern, are we in a position not to do it and what kind of problems will we incur if we wait for a financial statement that doesn’t become available until some time in November?” Bishop wondered. “I believe we just need to be way more diligent moving forward so we all know where everything is.”
Mayor Merlin Seymour also shared his input, stating money committed to the Co-op Centre from outside sources doesn’t come all at one time. “I’m not making excuses, I’m not patting anyone on the back or kicking anyone in the back, but our new Co-op Centre and the funds that have been raised – whether through the ICIP (Investing in Canada Infrastructure Program) grant, the insurance claim or through sponsorship – (it doesn’t come all at once),” Seymour remarked. “For example, the Meadow Lake Co-op did not cut us a cheque for $3 million. Innovation Credit Union did not cut us a cheque for $1 million. It’s cash draft right now the way I’m seeing it.” Read recognized this, stating several funding sources are delayed. “Yes, there are other funding sources, and, when they come in, we will get back on track,” he said. “But, like Marty said, we need to be more diligent.”