Loon Lake Firehall Loan Authorization

Affected Area(s): Loon Lake Fire Protection Service Area

Number of Parcels: 323

Borrowing Amount/ Term: $543,994 over 20 years

Loan Background

On June 23, 2018, through referendum, residents within the Loon Lake Fire Protection Service Area approved borrowing a maximum amount of $653,000 for the purpose of constructing two fire halls for the Loon Lake Fire Protection Service. The referendum passed 115-31.

Upon completion of the project, the actual borrowing amount totaled $543,994.

Total Project Cost: $1,482,081

  • Borrowing ($543,994)
  • Capital Reserve Fund ($536,963)
  • Donations ($322,079)
  • Grants via Canada Community Building Fund ($79,045)

 In May 2024, upon completion of new fire hall, a letter was sent to impacted property owners advising them of options to pay by a one-time, up-front payment by July 5, 2024, or have an annual amount added to their annual property tax notice for 20 years beginning in 2025. For affected property owners, a full breakdown of costs and payment options is explained in the blank letter, attached below.

About the Project

In fall 2018, following the referendum, the TNRD constructed a two-bay garage at 1701 Loon Lake Road, which was fully grant funded through the Canada Community Building Fund (previously called Gas Tax Fund). This hall is on land that is a Crown lease under the Loon Lake Community Recreational-Agricultural Society (LLCRAS).

In 2023, the main Loon Lake Fire Hall project was completed, replacing the former main fire hall that was destroyed in 2017 by the Elephant Hill wildfire. For more background information about this project, click here.

Question and Answer

Two fire halls now exist in Loon Lake: The Annex (Hall No. 2) was built in the fall of 2018, several months after the referendum, and the new Hall No. 1. The Annex was funded by grant funding (Gas Tax Fund), and Hall No. 1 was funded through various revenue sources, including approved borrowing. Loon Lake is operationally well-served by these two existing firehalls. If any other significant capital project were to take place, it would require additional borrowing to be approved by residents. For clarity, the TNRD is not proposing any further borrowing for a third firehall.

The total amount spent on Hall No. 1. was $1.48 million. The approved borrowing was based on the total budget minus the expected other revenue sources, such as reserve funds, grants, donations, etc. The other revenue sources ended up being higher than expected (i.e., community fundraising) and the construction costs were under budget. Therefore, we are only borrowing the amount of money that we need.

A total of approximately $323,000 in donations has been collected over the term of this project and has been used to directly fund a portion of Hall No. 1 construction. The total donation of more than $26,000 was specifically used to reduce the amount of the loan required.

Local governments have either option to fund borrowing. The TNRD practice has been to fund all capital borrowing through a parcel tax (where every parcel pays the same). This was communicated to residents as part of the public assent process; therefore, it cannot be changed because residents approved the borrowing based on the expectation it would be funded through a parcel tax.

The debt is attached to the property, not the owner. If you sell your property during the loan payback period, the new owner would continue to pay the parcel tax.

New parcels would also pay the parcel tax, effectively reducing the payments for all properties. In this scenario, there is no mechanism to refund anyone who chooses the commutation options. Residents should consider this in their decision.

No, the only option to pay early is to pay in full through commutation by July 5, 2024.

No, the interest rate is reassessed every 5 years. This means that the parcel tax would change if the interest rate goes up or down.

An active parcel is one that is within the Loon Lake Fire Protection Service Area and is taxable.

As of spring 2024, there are the same number of parcels as there was in 2018 (322).

If the number of parcels changes in the future, then each year the parcel tax balance will be redistributed over the number of active parcels.

No action is required by the property owner if you choose to pay the annual parcel tax instead of commutation. 

The annual parcel tax is added to property taxation notice that you receive from the Property Taxation Branch. No amount will be due for this in 2024. Payments will start in 2025 and will automatically show up on your 2025 tax notice.

The total debt owning would change, but the individual parcel tax will not change.

Example: $100,000 loan at 4% interest between 2 parcels:

  • Each parcel would owe $50,000
  • Interest on $100,000 equals $4,000 for a total amount owing of $104,000 (each parcel owes $52,000)
  • If 1 person pays $50,000 up front, the remaining parcel still owes $50,000
  • In this case, interest on $50,000 equals $2,000, and the total amount owing for this parcel is still $52,000

If you commute the firehall parcel tax payment, you are only paying for capital costs of the firehall project, and are not paying any interest. Therefore, the amount for the one-time commutation payment would not change regardless of how many parcel owners choose commutation.

Yes. Insurance proceeds from the previous hall was included in the transfer from the Loon Lake Fire Department Society that went directly to capital costs of Loon Lake Firehall No. 1. This transfer totaled $261,500 and a portion of those funds were a result of the insurance payout.

Loon Lake Firehall No. 1 is a standard, operational firehall. A typical municipal firehall would have significantly increased floor space for a number of areas including storage.

The building was constructed with precast concrete because, at the time, this material was less expensive than wood framing.

Most insurance providers subscribe to the Fire Underwriters Survey (FUS) to determine insurance premiums for each property. FUS considers a structure “protected” within 8 kilometres of a firehall by road distance, and some companies offer partial protection ratings for structures beyond 8 km that are within a Fire Protection Area.

We strongly encourage you to check with your insurance provider and seek additional quotes if needed. At least one insurance provider has reportedly insured property in the Loon Lake Fire Protection Service Area at approximately 17 kilometres away from the nearest firehall. For general questions, residents can ccontact TNRD Fire Protection Services or the Loon Lake Fire Chief.

Q & A updated June 13, 2024

Community Meeting

When: Thursday, May 30, 2024, 6:30 pm
Where: Online via Zoom (tnrd.ca/loonlakemeeting2024)

The TNRD hosted this meeting to inform within the Loon Lake Fire Protection Service Area about the completed Loon Lake Fire Hall project, and to provide an update on the parcel tax requisition for this project and commutation options for residents. TNRD staff provided a presentation and had a question-and-answer session with residents.


TNRD Finance Department
Email: finance@tnrd.ca
Tel.: 250-377-8673 (toll free: 1-800-377-8673)

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