Many people opposed to Light Rail complain about the debt that taxpayers will have to service. They are right to complain but they should also complain about all Government debt. The way ACT Treasury handle debt is unfair on existing residents. In the case of the Cotter Dam, with an expected life of 100 years, existing residents are paying 99 times more in interest than residents in 100 years time. This was pointed out by the Independent Competition and Regulatory Commission (ICRC) who recommended that we change the way we repay loans.
If we take a Crowdsourcing variation of the ICRC recommendation and obtain the funds from today’s residents the total cost to the Community of the Cotter Dam will be 25% of debt financing and the funding profit will go to residents. This assumes an interest rate of 4% over the 100 years.
For Light Rail with an expected life of 33 years the cost will be half the cost of using debt. Using this approach we can afford to have Capital Metro cover the whole of the ACT.