The Strathcona Regional District (SRD) may have a nasty surprise for property owners in Campbell River and Area D. They may soon be asked to approve an additional $54 million debt to finance the second phase of the new REC-REATE Strathcona Gardens project. When they originally consented through an Alternative Approval Process (which automatically passes unless 10% of the electorate object), taxpayers were informed the cost was almost half of what is now being put forward

“The April 2023 staff report indicated that both phases of the REC-CREATE project were going to be included. They had a Class A estimate they were using for the swimming pool and Wellness Center and they had a  2019 Class D estimate for the ice arena. They also said that the Class D estimate for the ice arena had been escalated. So you would assume by reading that the April  2023 staff report was costed up to be based on current construction costs and inflation.  In addition to that, what I found in the staff report was that they said that the $73 million would include both phases and that staff would strive to deliver the project within the $73 million budget.  That staff report, since it was in April 2023, was less than two years ago,” explained Deborah Rasnick, a professional accountant who worked in senior budget positions of BC public sector organizations for 15 years.

“ The new business case that was presented in December of 2024, and approved tentatively by the Strathcona Gardens Commission now, has an estimated cost for phase two only of $58 million. That’s on top of The previous approval. So the total cost now of the entire REC-REATE project could increase to around $130 million, and that’s an 80% increase from the prior amount.” 

“Same thing goes with debt. The original approval allowed for the SRD to borrow Up to $64.67 million and that was approved through AAP. Now this new REC-REATE project phase two, as they’re calling it,  wants to allow for an additional $54 million, creating a total debt of up to $118 million, providing they get authority to do that from the participants in the Strathcona Gardens service area.  That increase to total debt reflects an over 80% increase from the prior balance as well.” 

Cortes Currents – As previously mentioned, Deborah Rasnick held several senior budget positions. I asked her to give an overview of these. 

Deborah Rasnick: “I have over 15 years in budget shops within the BC government. The last position was acting in the capacity of Chief Financial Officer for the Ministry of Advanced Education. I was also Executive Director for post-secondary funding at that time.  Before that, my budget experience was being in the Director position for the budget shop within the provincial ministry that includes municipal affairs.  Prior to that, I worked in various ministries in the budget shop in management positions, including the Ministry of Finance, where the Premier’s office was my client.”

“Not only that, I also was an accounting faculty within colleges and universities in Victoria. I created course materials at all levels for management accounting, which includes budgets, it includes creating business cases, everything that they’re doing within the financial management roles within the SRD. I would have taught future accountants to  do that.  There’s almost a generation of accountants who probably would have had me as an instructor in Victoria before they went on to what’s now called the CPA. I also taught in government and created the course for government accounting and not-for-profits. So I have a lot of experience, not only working in the environment of a public sector organization in budgets and financial management, but I’ve also developed courses and taught them up to advanced level for these kinds of activities.” 

Rasnick expects that the average Campbell River and Area D property owners will see the Strathcona Gardens portion of their taxes rise to more than $600 per average home in 2026. 

She and Mike Gall belong to a group called Friends of Area C who are concerned about the possibility the SRD will expand the Strathcona Gardens service area to include Area C. This could add $428 to the average Area C property tax assessment during 2025 and $520 in 2026.

Cortes Currents also reached out to the SRD for comment, but they have yet to respond.

Deborah Rasnick: “If you ask most people much about this project, they wouldn’t have any idea at all.”

Mike Gall explained,  “A great example of how an AAP can be carried out effectively is how our Southern Quadra Island Fire Department is conducting an AAP process for the development of their second new fire hall. Their primary fire hall, in Heriot Bay, is in disrepair. It doesn’t meet a lot of the standards that are required today and if there were an earthquake, the cinder block would drop and bury the two fire trucks that are in there. So they need a new fire hall.” 

“The process that they’re using is excellent. What they’re doing is they’re using public announcements, open houses and conveying all the information through local papers and media sources to the public and allowing them to ask any questions that they want.” 

“That is the way an AAP can be used effectively and certainly not the way that the SRD operates. They’d use the minimum amount of  legally required explanation of what’s going on. Unfortunately, that’s how they  slipped their AAPs through without engaging the public.”

Deborah Rasnick: “If they’re in Campbell River, they may have some support for the project because it’s right there in their community. They benefit from it economically – and the labor is probably almost exclusively Campbell Riverites. Most of the people who do the hockey are in Campbell River. It’s their game. It’s their sport, awesome, they’ve got the associations involved like junior hockey and  that’s part of why they’re developing the ice rink to the gold standard for the ice rink. 

“If they want to build a solid gold hummer, go ahead, but Paws Off of Area C’s taxes because we don’t have basic services. We don’t need to be paying for  a solid gold hummer that benefits primarily Campbell River.  Now I feel sorry for Area D. Honestly, I do, because I think since they don’t have a rec center, that’s why they were drawn in to Strathcona Gardens  and hopefully they derive some benefit from that. But I think Campbell River is the ones who are getting the major benefits here and therefore they ought to be the ones that continue to be the major source of funding for Strathcona Gardens.” 

Mike Gall: There’s an extraordinary expense about to hit that whole SRD area in one form or another. When we have discussions of this magnitude and adding crippling debt to an already overburdened community, we have to expect that the SRD will have some meaningful public consultation and explain exactly what it is they’re trying to do.”  

“They’re not doing that. They’re hiding behind the AAP process.  There’s a failure by the SRD Board to consult the constituents of Area D and the city of Campbell River.  We, the people of Area C,  are concerned that the lack of transparency and communications will be extended to our area.  Should the Board choose to expand the Strathcona Garden service, we will be  Just completely dumbstruck with an extraordinary amount of tax that is completely unnecessary and the highest expense item within all of our taxable services.” 

 Deborah Rasnick: “I did a comparison between Area D’s taxes per average home and Area C’s taxes per average home related to SRD services.” 

“So starting with Area D, when you look at what are the most expensive SRD services, fire protection is a new service that they have coming in and that one is at $535 per average household.  Strathcona Gardens in 2025 for Area D is coming in at $527 so almost the same and, by the way, the only reason that that figure is $527 for Strathcona Gardens is because of a one year tax delay that the Board decided to do. Next year, the tax will go all in and there’ll be over $600 at that point for Strathcona Gardens for Area D. Their water is $413.  Their library is $119. (So Strathcona Gardens is more than four times as expensive as their library.) Parks – $116. Transit – $106.”

If we were to be dragged into Strathcona Gardens, I’ve estimated that the amount per average household for Area C would be $428…  Our most expensive item right now for Area C is our Quadra Community Hall and it comes in at $180 per average household. So Strathcona Gardens is more than twice that – for a swimming pool and a rec center we don’t use.  Our next items are parks at $120, the library at $103, and our emergency program and 911 combined are $42.”

“What else do we pay for essential services?  For the Regional Hospital,  we pay less than $200 per average household – $200. Same thing goes for our solid waste facility for all of our recycling, all of our solid waste – $77 per average household, and police services are $60.” 

“So you can see, we don’t have many services.  What we do have are pretty essential, being our community hall, which is our equivalent of the rec center. We have lots of programming happening there. It’s for our parks, it’s for our library. They are on our island, not across the pond where we have to pay ferry costs and have extra time.”

“I can’t even get out of my driveway right now because of the snow.  I’m in the north, which is called ‘the Beyond’ here on Quadra.  We haven’t actually had our roads cleared yet,  so am I gonna use this swimming pool?  – No!” 

Mike Gall: “The only thing that Deb left out was the Southern Quadra Island Fire Department service area and that adds about $400 or $500 to the average bill, at least I paid $500 something. I consider that to be a very essential service. Deb doesn’t even get the benefit of that where she lives. 

Deborah Rasnick: “His area in the southern part of Quadra Island pays for fire protection and it would likely be one of the most expensive items that folks in South Quadra pay.”  

Mike Gall: “But it’s also not an SRD service. We pay for that directly through to the province. I think the SRD might collect it.”

“We move to these outlying rural communities purposely.  Why on earth do we need access to a pool and to a skating rink? There are a few people within the community that do use those facilities.  More or less, 95% or more of the population don’t use them at all.”

 “There’s one more point and it’s the geographic isolation that exists by a body of water separating us from that community.  It’s often the barrier that  helps you make that decision as to whether or not you’re going to Campbell River or not, because unfortunately, the ferries are an inconvenient convenience.” 

“I just don’t understand the logic that they’re using other than they want our tax revenue.” 

“If you really think about it, if I am a hockey player – or a swimmer, or someone who’s in need of some sort of therapy in their hydro pool system, whatever it is that they’re building – I’ll make the day happen around that activity. I’ll schedule everything I have to do to get there and return as efficiently as I can. But I’m not just going to ad hoc say to my grandkids, ‘Hey, let’s go over and jump into the pool. What do you think of that?’ Well, they’d probably say yes, but they don’t realize the inconvenience.”

Deborah Rasnick: “I was looking at the draft 2025 to 2029 financial plan for the SRD, we found some surprises in that draft budget. Although there was a business case that supported those surprises and I had reviewed it. It was such a brief business case that it wasn’t particularly clear to me as a professional accountant about what it would mean in terms of the new project costs and new debt. in addition to the previously approved amounts.” 

“Discussing the business case that was done, I would suggest to the SRD board, as well as the financial management team in the SRD, that it would be appropriate for them to look at the content that they expect in their business cases when they’re making decisions for new capital budget requests.” 

“They called that a business case, but it was only two and a half pages long. Remember that this project funding was being asked on a $58 million project and that request carries $54 million in debt.  There was no debt schedule to show the overall cost to taxpayers.  They didn’t talk about the requirements that they’d have to go to an alternate approval process or some other form of approval from the electorate. There was no mention of that in the business case written.  They did not talk about the impact to the total project costs.  In other words, that it would be increasing to almost $130 million.  They were not talking about the fact that the total project debt for the recreation project would now be $118 million. None of that was contained in that business case.” 

She explained the folks from Area C are watching this project and think the cost is too much. 

If this additional debt is approved, the people who pay for Strathcona Gardens will have to pay about $5 million a year in interest charges. 

Deborah Rasnick: “The total budget for Strathcona Gardens, what they tax us for, is $13 million starting  in 2026 and the interest component of that just paying interest is over 37%.  So for every $1 in property tax people pay for Strathcona Gardens, over 37 cents of each dollar is going to go down the drain, paying for debt through interest payments, the debt repayment is on top of that.” 

“This level of business case, in my professional opinion, is just insufficient. It is just insufficient. I would suggest to the SRD Board, as well as the financial management team in the SRD, that it would be appropriate for them to look at the content that they expect in their business cases when they’re making decisions for new budget requests, new proposals of funding.”

Cortes Currents: Okay, Half the funding has already been approved and construction has begun. What can the Strathcona Gardens project do now?

Mike Gall:  “I think that the Strathcona Garden Commission realizes that they’ve bitten off more than they can chew.  They need to stop right now, and they need to consider all the cost savings measures that they can possibly do for this phase two project, or cancel phase two in its entirety.  They simply have to ask themselves, ‘is this the right time to spend money so extravagantly?’  In my opinion,  the SRD board members who vote in favour of phase two, saddling participants with needless debt, will likely have a very short political career.”

Links of Interest

• REC-REATE Strathcona Gardens website
• Draft 2025–2029 Financial Plan – Strathcona Regional District
• Articles about, or mentioning, the REC-REATE Strathcona Regional Gardens project

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