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Altogether, SWIFT is looking for guarantees worth $27.5-million from the participating counties. The 14 counties are being asked to have the guarantees in place by the end of January.
The province approved Phase III last March and SWIFT has committed to over $150 million worth of projects.
In total, the internet project will cost $290 million.
Despite the loan guarantee, no money will actually be advanced by Essex County. The guarantees from local councils will be used to secure financing from the Toronto Dominion Bank.
SWIFT has no tangible assets and requires the backing from the respective county councils to secure the funding.
The financing for Phase III is expected to be in place during the 2021-2022 period.
“I don’t think we have much of a choice,” Amherstburg Mayor Aldo DiCarlo said.
“If the municipality doesn’t guarantee the loans, they won’t begin construction in our region.”
The provincial and federal government’s will repay any SWIFT loans once the projects are finished.
However, the $2.3-million guarantee must be noted in council’s financial statements and reported to bankers and credit rating organizations. It will be viewed as a contingent liability.
The administrative report tabled for council concludes there is ample room to absorb the liability and it won’t create any tax-supported debt.
Any costs not covered by the provincial or federal government are to be covered by the internet service providers further reducing the risk the county would be left on the hook for any additional expenses.
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