OI asks town to reschedule Connected Community loans
Chair said it’s like refinancing a house – Tuesday, Feb 28, 2017 06:00 am – By: Doug Collie
With the help of “a third party,” town administrative staff are analyzing a proposal by Olds Institute (OI) to stretch out the repayment period for two loans totaling $14 million it received from the province via the Town of Olds.
Chief operating officer Doug Wagstaff confirmed the undertaking after OI chair Cody Becker appeared before council to ask for the repayment extension.
Becker noted council secured the loans from the Alberta Capital Finance Authority (ACFA). The loans were made to OI via the town to finance installation of fibre optic lines to homes and businesses throughout Olds to connect customers to O-NET.
O-NET is a community-owned firm that provides high-speed Internet as well as phone and TV service. Becker said the loans are still being used to finance those installations as more customers come on-stream and as more subdivisions are built.
Because it’s expensive to install those lines – especially in older areas — the principal has since been re-loaned back to OI to finance that work, Becker said.
Becker said in hindsight, OI and its technology committee were perhaps too optimistic about the time period they’d need to repay the loans to get the Olds Connected Community Network up (the fibre connections) and running and financially strong.
The two loans with a combined total of $14 million were approved by Olds council in 2011 and 2014. During an interview with the Albertan, Becker said currently, one is amortized (to be paid back) over 10 years, while the other is over 15 years. He’s hoping to have the two loans consolidated into one and have that loan amortized over 25 years or so.