Huntsville Mayor Scott Aitchison wants a piece of the action when it comes to loaning money to Lakeland Holdings Inc., which is hoping to expand its high-speed Internet capabilities in the region.
At Council’s March 27 meeting, Aitchison told fellow councillors that the District has unanimously approved a loan of up to $10 million to enable Lakeland Holdings Inc. to access federal funds in order to expand high-speed Internet services to rural communities. The Connect to Innovate grant program will invest up to $500 million by 2021 to build and/or enhance high-speed Internet in remote and rural communities in Canada.
“So Lakeland Energy [a subsidiary of Lakeland Holdings Inc.]of course has already started doing a lot of this work and they would like to make an application to that fund,” said Aitchison, who added that the program could cover about 75 per cent of Lakeland’s initiative, if their application is approved.
“District council approved that unanimously as it turned out and so they’ll be making application and hopefully won’t have to use all of that borrowing capacity. And also, I’ve asked staff to put a report together for our council to look at whether we may be… in a position to loan them some money as well,” said the Mayor, referring to the possibility of using part of the dividends the municipality receives to loan it back to the company. “Obviously they’re paying a decent rate, better than what we’re getting on GICs, that’s for sure.”
The municipality currently gets about a one per cent return on its GICs and if it were to loan money out to Lakeland, it would instead get a return of about three per cent, according to Huntsville Treasurer Julia McKenzie.
Lakeland Holdings Inc. and its subsidiaries, made up of Bracebridge Generation, Lakeland Power and Lakeland Energy (Networks), are jointly owned by Bracebridge at 54.97 per cent, Huntsville at 21.22 per cent, Parry Sound at 15.57 per cent, Sundridge at 3.66 per cent, Burk’s Falls at 3.34 per cent and Magnetawan at 1.24 per cent.
In 2016 the Town of Huntsville received $353,223 off its Lakeland dividends.
Lakeland has put together a $25.4-million application to expand its fibre optic network by approximately 275 kilometres across the area, with the potential of adding another 3,436 customers including homes, schools, medical health care providers, public housing, other educational institutions as well as community support organizations and government facilities.
In Huntsville, the expansion would cover 18 kilometres, affecting 193 potential customers. In Lake of Bays, the proposed network expansion would traverse about 34 kilometres of the Township with the potential of adding another 403 customers.
The Connect to Innovate application deadline is April 20, 2017. Projects to be considered are expected to have the ability to be substantially completed by March 31, 2021. The announcement of funding recipients is expected at the beginning of summer 2017.
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Brian Tapley says
All good generally. Lakeland seems to be one of the better private power corporations and their diversification into the fiber optic field may be a good thing also.
Remember though that the original set up for “Ontario Hydro” which was one of the worlds first significant electrical utilities was to supply electricity “at cost to the people of Ontario”. They made Adam Beck into “Sir Adam Beck” and put up a large statue of him to show how important this concept was!!
At the moment it is very popular for many of our population to be crying for lower electricity rates and there are some good reasons to ask for this. Part of the problem with electricity prices is that the privatization of Hydro (started by Mike Harris Conservative government) has resulted in many private electricity providers and these all must make a profit. It appears that Lakeland is providing about 3% to it’s share holders. The original Hydro mandate did not require this type of profit to be distributed so, at least in theory, the price we would be paying for electricity now would be less if it was supplied by the “old school” Ontario Hydro.
It is hard to be sure as our current “Hydro One” has a fairly large and highly paid management (which I suspect is not quite the case with Lakeland for example) and this plus the huge debit load Hydro One has been saddled with probably means that all figures are distorted and the “lower prices in theory” remain just that, a “theory”, but it is worth remembering all this.
The current pricing for solar and wind alternate energy providers is another form of “profit” that we all must pay as part of our electric bill but I won’t go further than to mention this here.
When we see our next electric bill not all of it is for the electricity, a portion will be to pay a dividend to shareholders if we follow the Provincial model. Lakeland is but one small part of this privatization process and who, really knows. In the end greater efficiency, lack of huge debit loads and diversification such as this fiber optic growth might actually keep electric rates lower than with the large monopoly. Large monopoly type providers such as Hydro One theoretically have economy of scale on their side too but they also seem to accumulate a bloated and highly paid management and even unions get their oar into the pond with some pretty high wage and benefit packages for employees that a lot of smaller private companies may be avoiding.
It is all virtually impossible to prove either way for the average person. We all just get our bills and have to pay them