City grants organization time to pay back loan

Family Services of Central Alberta has had an outstanding loan of $32,800 with the City of Red Deer for more than 20 years

  • Apr. 7, 2017 2:41 p.m.

Family Services of Central Alberta has been given up to four years to pay a loan to the City which dates back to more than 20 years ago.

In 1992-1995, the City provided advances to several organizations who were experiencing difficulties in managing budget fluctuations due to provincial FCSS grant payment schedules.

Family Services of Central Alberta received $43,200, of which $32,800 remains outstanding today.

In February, City administration received a formal letter of request from FSCA to forgive the advance owing by their organization in the amount of $32,800.

“This one for me is very tough because you are dealing with an organization that provides services to our community in a way that is really appreciated and needed,” said Councillor Lawrence Lee. “The challenge that I have in looking at this is going back, I think you have to look at the premise in how the agreement came to fruition. It came at a time when the community organizations listed in the agenda came to the City and asked if we could, as a City, utilize taxpayer funds to bridge financing for those organizations, and then we did. Thirty-two thousand, eight hundred dollars back then, if my math is right, is about $100,000 in today’s dollars and values now.

“It was the community’s money that was loaned at that time with the expectation of commitment and promise to pay that money back. That is what I have to fall back onto.”

City Manager Craig Curtis said he recommended council consider allowing up to four years to pay off the loan due to the increasing community needs and demands on FSCA, the economic climate and the more than 20 years the balance has remained outstanding.

In 2007, the City began requesting repayment of these advances annually, administration said.

By 2016, the money had been outstanding to the City for over 20 years. Over those 20 years, all other organizations that received advances from the City have paid back their advance amounts, some with great hardships and with direct impact to the services they could provide to the community at the time, council notes read.

“I just wonder why it would go on and on and on. If somebody owes me $32,000 I’d be on their case,” said Councillor Lynne Mulder.

The last time the issue was brought to council was about eight years ago, said Curtis.

Council granted FSCA up to four years to pay back the outstanding loan with Councillors Buck Buchanan, Dianne Wyntjes and Ken Johnston voting against the motion. Councillor Tanya Handley was not present as she had a conflict of interest in this matter.