New policy nets Paradise $1.3 million revenue

By Mark Squibb

Members of Paradise council last week approved a new security deposit policy that will see $1.3 million in security deposits forfeited to the Town’s coffers.

Councillor Larry Vaters first brought the matter forward during the February 11 committee meeting. Vaters explained that a policy is required to outline the Towns approach to managing the release of development security deposits and addressing unclaimed security deposits, with the exception of major subdivision security deposits, which are covered under subdivision agreements.

“Security deposits are paid to the Town based on the conditions set by the applicable permit, and the fee outlined in the annual fee schedule, and are released upon request once it is confirmed that all conditions set out are met,” said Vaters. “Over the years, the number of security deposits being held by the Town has been increasing, and during the 2023 financial audit, the Town’s auditor recommended that the Town develop a policy to recognise funds deposited prior to 2017 be counted as revenue.”

The new policy states that any new security deposits paid to the Town – with the exception of the aforementioned subdivision securities— not claimed within six to seven years from the date the deposit was received will be forfeited to the Town and unable to be claimed.

Once the policy is adopted, any current, unclaimed deposits that are seven years old as of December 31, 2024, will be considered forfeited.

Paradise has $1.3 million in such deposits.

Deputy Mayor Kimberley Street asked whether a report would be made available to council detailing what type of permits make up the majority of the deposits and whether there is a particular pattern.

CAO Lisa Niblock said the majority of deposits are landscape deposits.

“In most cases, houses have passed hands and people have, I think, forgotten that they have deposits, here,” said Niblock.

Councillor Glen Carew asked might what happen if someone came looking for a deposit that the Town had already earmarked as revenue, as per the new policy.

Niblock said the Town had sought legal advice and the risk of liability is “very low.”

Councillor Deborah Quilty said the six-year timeframe is excessive, and two or three years would be more appropriate.

“Six years out seems like a long time to be holding deposits in our general account,” said Quilty. “Six years is a mighty long time for a deposit for landscaping and other works that are being done where deposits are retained by the Town.”

Niblock agreed with Quilty regarding the timeframe and said the policy may be revisited within a year or so.

Council agreed to move the item to the public agenda for a vote, where it was approved the following week.