WHEREAS Seniors’ Housing Authorities are not authorized by the province to borrow directly from the Alberta Capital Finance Authority; and
WHEREAS Seniors’ Housing Authorities would have to be become shareholders of the Alberta Capital Finance Authority under the Alberta Capital Fianance Authority Act in order to access some of the lowest cost loan rates available to Alberta’s local governments; and
WHEREAS municipalities are being requested to borrow funds from the Alberta Cpaital Finance Authority on their behalf in order to allow them to access borrowing at lower interest rates; and
WHEREAS borrowing by municipalities on behalf of the Seniors’ Housing Authorities results in negative impacts on financial reporting and borrowing limits, or where borrowing is refused, then Seniors’ Housing Authorities may be forced to borrow funds at higher interest rates; now
THEREFORE BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties request that the Government of Alberta amend the Alberta Capital Finance Authority Act to add Seniors’ Housing Authorities as shareholders of the Alberta Capital Finance Authority.
Extract from the Alberta Capital Finance Authority Act.
4 (1) The share capital of the Corporation shall consist of
(a) 4500 Class A shares to be allotted only to Her Majesty the Queen in right of Alberta;
(b) 1000 Class B shares to be allotted only to municipal authorities, health authorities and regional authorities,
(c) 750 Class C shares to be allotted only to cities,
(d) 750 Class D shares to be allotted only to towns, and
(e) 500 Class E shares to be allotted only to educational authorities.
21 The business of the corporation is
a) To provide local authorities that are its shareholders with financing for capital projects;
This resolution has an identical goal to that of previous resolution 1-07S: Debt for Seniors’ Housing Authorities. Resolution 1-07S states: THEREFORE BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties request that the Government of Alberta amend the Alberta Capital Finance Authority Act to add Seniors’ Housing Authorities as shareholders of the Alberta Capital Finance Authority.
Resolution 1-07S expires on the last day of the Spring 2010 Convention, as per AAMDC bylaw 6 (n): “Resolutions that receive the endorsement of the convention assembly shall be effective for three (3) years following their passage, after which they cease to have effect.” Resolution 1-07S had a status of “Accepted in Principle” prior to its expiry.
Finance and Enterprise:
The Ministry of Finance and Enterprise is examining the impact of allowing management bodies that operate seniors’ lodges to borrow directly from the Alberta Capital Finance Authority (ACFA). The ministry will consider, among other issues, the impact of the proposed amendment on the financial risk of the ACFA and will work with the ACFA as well as the ministries of Municipal Affairs and Seniors and Community Supports in determining the appropriate solution. At this time, the ministry has not set a timetable for any decision to be made.
Through the government response to the resoution and meetings with the Minister of Finance and Enterprise, the AAMDC has continued to receive responses that do not support the change requested to the Alberta Capital Finance Authority Act. While a challenge for municipalities is recognized, there is an indication that allowing senior’s housing authorities in to the Alberta Capital Finance Authority would increase the overall borrowing risk of the organization. However, there will be discussion on this issue during the comprehensive review of seniors lodges that the AAMDC is completing with Municipal Affairs, the Alberta Urban Municipalities Association, and the Alberta Senior Citizen’s Housing Association. Recommendations from this committee will be sent to the Minister before the end of 2013.