Cork’s City councillors have been asked to consider seeking ministerial approval for a €40m long-term loan to fund public works such as road and footpath repairs.
However, a suggestion that the loan repayments could be linked to agreed increases in the city’s local property tax rates (LPT) has already sparked opposition.
Council chief executive Ann Doherty has discussed the broad outline of the proposal with party whips and declined to discuss it in detail while it is still being considered by councillors.
However, in a statement, she said: “The investment needs of the city are kept under continuous review by the council, including the requirements for investment in the public realm.
“As chief executive, it is incumbent upon me to identify possible options whereby these needs can be funded, and to work with the members of the city council in the first instance to explore how these options might be advanced.”
However, it is understood the proposal is for a long-term loan from international lending markets of up to 30 years, with an agreed increase in LPT rates being ringfenced to fund the repayments.
Fianna Fáil councillor Sean Martin said he felt the loan term was too long and linking repayments to LPT rates is a non-runner.
“I don’t think it’s viable,” he said.
“It’s like the 1985 council imposing something on the present council. I don’t think we have the moral authority to tie later councils to such a proposal.”
Fianna Fáil councillor Ken O’Flynn also rejected the proposal, saying: “It would tie the hands of council for up to 30-years. We need to find a far more imaginative way of resolving our funding issues.”
Fine Gael party whip John Buttimer said he could not see councillors voting to raise LPT rates to repay a loan. He added that the finance committee was told last week that if there is no change to Cork City’s LPT rate this year, the council will be €600,000 better off.
“Our decision last year to decrease the rate by 10% was based on populism. The brave decision is not to change it,” he said.
Independent councillor Mick Finn, the technical group’s whip, declined to comment but confirmed he had relayed the proposal to his fellow councillors.
© Irish Examiner Ltd. All rights reserved