Responsible Growth: Looking at the Complete Financial Picture
Responsible Growth: Looking at the Complete Financial Picture
Borrowing and the full cost of investment
Borrowing is not automatically irresponsible, just as avoiding borrowing is not automatically the right financial decision. What matters is what we borrow for, how much it costs over time, how the debt will be repaid and who ultimately bears the cost.
The Township’s published financial information distinguishes development-charge-supported borrowing from borrowing supported by the municipal tax levy. That distinction is important because not all municipal debt is repaid in the same way.
A municipality needs to consider the full cost of borrowing, future operating and maintenance costs, the impact on taxpayers, and whether the investment produces measurable benefits or supports essential services.
As a former business owner, I understand that growth sometimes requires investment. When I was starting out, I had to buy used equipment. Over time, that equipment wore down, and I reached a point where I was spending 15–20% of each day repairing and maintaining it just to keep the business operating. That was time I wasn’t spending being productive or growing the company.
I made the decision to borrow money to invest in new equipment. That investment eliminated much of the repair time, increased productivity and allowed me to expand operations. Ultimately, it helped increase my income by 20%. The loan required financial support, and I knew that 5–7% of that productivity increase would need to cover the loan payments associated with the investment.
Was borrowing a risk? Absolutely. But it was a risk I examined, evaluated and managed because the potential benefits justified the investment.
Municipalities face similar decisions. Sometimes borrowing is necessary to replace aging infrastructure, improve services or support growth. The important thing is to examine the costs, understand the risks, establish a realistic repayment plan and determine whether the investment will deliver measurable benefits.
In a Facebook post on October 4 titled “Growth does not pay for growth,” Chris Norton raised concerns about the Township’s growth forecasts, development-charge revenues, reserve balances and estimated annual infrastructure funding gap. These are important issues that deserve an honest and thorough discussion.
However, when we discuss these numbers, it is important to look at the complete picture, understand what each figure represents, and distinguish between projections, actual results and conclusions drawn from them.
For example, a projected number of housing units is not the same as the number of homes actually built. A partial-year revenue figure does not necessarily establish a long-term trend. And an infrastructure funding gap does not, by itself, establish that growth caused the shortfall.
My intention is not to dismiss the financial concerns raised in Chris Norton’s post. It is to examine them against the Township’s own reports and financial information so residents can understand the facts, the assumptions and the questions that still need answers. That is what I have been doing over the last few weeks since the post was published.
Responsible growth means looking at all the information—not just individual numbers in isolation.
The original Watson growth forecast
Did you know which chart Chris Norton referenced?
The original growth forecast comes from the Development Charge Background Study, dated February 18, 2022, prepared by Watson & Associates Economists Ltd. for the Township of Greater Madawaska.
The study projected housing growth over the 2022–2036 period. Its forecast is a planning projection, not a guarantee of how many homes will be built in any particular year. The original forecast of approximately 31 units annually and the newer draft forecast of 235 units over five years—approximately 47 annually—should be compared with actual building activity before conclusions are drawn about whether growth is meeting expectations.
Norton’s post lists an average of approximately 21 permits per year from 2012 to 2019 and points to 57 permits in 2021. The historical permit chart in the 2022 study does not establish how many permits were issued from 2022 through 2025.
To assess the newer forecast properly, we need those actual figures and the development pipeline behind the projected 235 units over five years. The Township’s September 17, 2026 presentation included preliminary growth forecasts, a draft capital program and draft development-charge calculations. These are preliminary projections, not approved new development-charge rates.
Residents deserve to understand the assumptions behind these forecasts, what has changed and how those projections influence infrastructure planning and development charges.
Development-charge revenue: looking beyond one number
Chris Norton’s post refers to $57,762 in development charges collected by July 31, 2026, and a projected 2026 contribution of $192,560. These figures should be considered alongside the full-year budget, the timing of building permits and collections, and the costs those charges are intended to fund.
Norton also compares 2022 and 2025 collections with the equivalent of a number of single-unit development charges. He is clear that these are revenue comparisons, not counts of homes built. That distinction matters.
Development charges are one-time fees that help pay for eligible growth-related capital costs. They are held in service-specific reserve funds and cannot be used to fund ordinary operating costs.
A partial-year collection figure does not, by itself, establish whether the long-term forecast is wrong or whether growth is financially sustainable. We need actual construction figures, full-year collections and the associated capital funding requirements to assess that properly.
Understanding the reserve balances
The 2025 Annual Treasurer’s Statement reported a deficit of $242,477 in the roads development-charge reserve, while the combined balance across the development-charge service categories was positive by $3,464.
The roads deficit is a legitimate financial concern that deserves an explanation. The Township’s budget material also acknowledged that projected costs for development-charge-funded projects exceeded the available reserve and that staff expected it would take longer to recover the deficit.
That raises an important question: if the Township borrows to complete growth-related infrastructure before the expected development charges are collected, what is the repayment plan if the projected development does not materialize?
At the same time, a deficit in one category should not be presented as though every development-charge reserve is in deficit. Each reserve needs to be considered individually, including its commitments, eligible expenditures and expected future revenue.
The important question is how the Township is managing these funds, what assumptions support the repayment plan and whether that plan remains affordable if growth falls short of expectations.
The infrastructure funding gap
The Township’s estimated annual infrastructure funding gap of approximately $1.53 million is a significant concern. The Township’s Asset Management Plan identifies approximately $2.3 million in annual asset requirements against approximately $766,000 in annual contributions.
This gap relates to the cost of maintaining and replacing municipal assets. Roads, buildings, equipment and other assets require maintenance and eventual replacement regardless of whether new development takes place.
From my research, the Township’s Asset Management Plan identifies a significant gap between the annual funding needed to maintain and replace existing infrastructure and the amount being contributed. That raises an important question: have contributions kept pace with the long-term cost of maintaining the Township’s assets? The current funding gap is clear, but determining how much earlier budget decisions contributed to it requires looking at the historical budgets and reserve contributions
That is why we need to look beyond one year’s budget. Keeping taxes low in the short term can have consequences if it means necessary maintenance and replacement costs are deferred. Those costs do not disappear; they can accumulate and become more expensive to address later.
Growth can add infrastructure costs, but the overall funding gap does not, by itself, establish that growth caused the shortfall. We need to distinguish between the cost of maintaining what we already own and the additional costs associated with new development.
Both matter, and both must be considered when Council makes financial decisions.
My position on responsible growth
I support appropriate residential and commercial growth in Greater Madawaska. Growth can provide opportunities for families, support local businesses and help sustain the services our community needs.
But growth must be planned properly. We need realistic forecasts, transparent financial reporting and a clear understanding of how new development affects infrastructure and taxpayers.
The figures raised in Chris Norton’s Facebook post deserve examination, but they should be considered alongside the complete information in the Township’s reports. Forecasts are not actual construction figures, partial-year revenue is not a full-year result, and an existing infrastructure funding gap is not proof that growth caused the shortfall.
Residents deserve the full story, not conclusions based on headlines alone.
I am not suggesting that financial concerns should be ignored. I am saying that residents deserve the full picture before conclusions are drawn.
I have attached the sources I reviewed, and I encourage everyone to read them for themselves. Take the time to look at the complete information, understand the context and draw your own conclusions.
I believe in steady, responsible progress.
Keep what works. Improve what doesn’t. Plan for what’s next.
The following sources were used
September 17, 2026 - Council agenda and Watson presentation
February 18, 2022 - Development Charge Background Study
2025 Annual Treasurer’s Statement of Development Charges
2025 Municipal Budget Presentation
Township budgets and financial statements