West Kelowna city council has given the go ahead for the city to borrow up to $11 million to pay for its new city hall.
The financing was approved a year after authorization was given to borrow the money needed for four-floor, 51,500 square foot building, estimated to cost $18 million.
The total cost will include $7 million from reserves put aside for the new city hall, as well as money from the Okanagan Regional Library for their share of the building.
Chief financial officer Warren Everton told council the purpose of approving the borrowing authorization now is to "maintain cash flow and take pressure off the city's reserve bank balance."
Everton says spending is well underway and starting to draw on cash reserves.
"Having borrowing in place until we are certain about final costs is a real benefit," Everton said.
"The city can borrow at a low rate for up to five years, until having to convert to long-term debt. Once this bylaw is passed, we can draw from reserves, the library and the temporary borrowing proportionally as we move through the project."
Responding to questions raised by Coun. Doug Findlater concerned about budget and the volatile construction climate, CAO Paul Gipps said the three tenders issued thus far have all come within budget projections.
"As we go through each of the tenders, we make sure we are coming in within the budget," said Gipps.
As for the cost of materials, Gipps says some are going up and some coming down.
"Lumber prices are going down in some cases, some of the engineered products are going up.
In some cases, concrete came down, then concrete went back up again."
Construction is expected to conclude near the end of 2022.