By ROY WOOD

After lengthy debate and clearly divided opinion, Osoyoos council decided Monday to borrow about $1.5 million to pay for a water twinning project rather than dip into its $2.6 million water reserve fund.

The borrowing option was recommended by senior town staff, including operations director Jim Dinwoodie and finance director Jim Zakall.

Their main argument was that interest rates are likely to rise over the next couple of years and with substantial other capital water projects on the horizon, it makes sense to borrow now at a lower rate than to risk having to borrow later at a higher one.

The borrowing in question — $1,538,615 – would pay the town’s 27-per-cent share of the $5.7-million project to complete the twinning of the southwest sector of the water district. The town is applying for a federal-provincial infrastructure grant to cover the remaining $4.2 million.

Leading the charge against the borrowing option was Councillor CJ Rhodes, who questioned the prediction that interest rates are likely to rise. “There is no way of knowing that the interest rate is going up,” he said, calling rate projections “pure speculation.”

Councillor Mike Campol countered: “We have to have some faith in our financial directors.” He said he worries that a decision to spend the reserves rather than borrow at lower interest rates might cause a future council to “(look) back in hindsight and say that we just cost a half a million dollars” by not heeding the staff advice.

Councillor Carol Youngberg agreed: “I don’t want to see (future) infrastructure developments put in jeopardy if the interest rate does rise and it prevents us from moving forward because our reserves haven’t been built up enough.”

Councillor Jim King suggested that perhaps there could be a compromise to spend some reserves and borrow a portion. None of his council mates took up the idea.

In the end, Mayor Sue McKortoff sided with Campol and Youngberg to pass a motion to borrow the money. King and Rhodes voted against.