Interior Health will be reducing the scale of their projects for 2024 due to funding cuts.
The Okanagan Similkameen Regional Hospital District voted on Feb. 8 to scale back the amount of funding that they would provide through taxation for projects in the region.
At the board meeting on Feb. 22 to formally adopt the budget, directors were informed that IH would not be making up the funding elsewhere, and would instead be looking to cut down on what they planned to purchase.
“They wanted to state they will not necessarily be looking to top up the 10 per cent that they no longer get,” RDOS CAO Jim Zaffino told the board. “It’s now their decision on which equipment they will purchase or not to meet the new budget they have.”
The hospital district traditionally provided 40 per cent of a project’s costs, with Interior Health and the province making up the remaining 60 per cent barring some exceptions like the fundraising for the Penticton Regional Hospital’s new tower or oncology expansion.
Had the board gone with that traditional amount, it would have resulted in a substantial increase to the hospital district’s tax levy on residents.
As a result of the board’s Feb. 8 decision, the expected increase to the tax requisition for residents in the OSRHD will be 5.16 per cent, or an expected cost for the average household of $123.91, compared to a cost of $118.02 in 2023.
That will scale back about $4.6 million from the total requisition, while still allowing for some funds to be transferred to reserves.
If the board had gone with the 5.16 per cent increase and not lowered the requisition, it would have drained their reserves significantly, with an expected balance of just $268,761 by the end of 2028.
Interior Health did not inform the board as to which projects would be scaled back or by how much each project will be impacted.
“With the cost of projects and our tax base, we can’t continue to fund 40 per cent,” said OSRHD chair Martin Johansen on Feb. 15. “The needs are there, we’re not arguing that there is no need, we’d like to fund everything we can. The reality is we just don’t have enough money to do it.”
READ MORE: Okanagan hospital district scales back funding for capital projects