2

5 , Business

Is B.C.’s new Working Opportu-
nity Fund going to work for you
and your money (assuming you are
an employed B.C resident and so
qualify to buy the shares)?

You should study the 50-page
prospectus carefully — especially
the three pages on Risk Factors —
to help you answer that question.
If you don’t read or don’t under-
stand the prospectus, then you
should not buy the shares. Your
personal and financial situation

will determine whether you should

go for this made-in-and-for-B.C.

investment.
| “The fund could be suitable
| ® even for unsophisticated investors
as long as they understand the
tisks involved and have some other
savings and investments, too, for
diversification,’ David Levi, the
fund’s president and chief execu-
tive officer, said in an interview.

The provincial and federal tax
credits offered to investors are the
big attraction. Levi feels they go a
long way to reduce the risks
involved; again, youll have to
decide whether you agree.

You can claim a federal tax
credit of 20 per cent of your
investment up to a maximum cre-
dit of $700 each tax year — with a
special “doubling-up” provision
in the first two months of the year.

That means if you invest $7,000
by 2 p.m. Feb. 29, you would
claim a $700 federal tax credit for
the 1991 tax year and a $700
credit for the 1992 tax year. (Note
that the proposed federal rule pro-
viding this credit has not yet
become law.)

You can claim a provincial tax
credit of 20 per cent to a maxi-
mum of $2,000 per tax year, to a
| lifetime maximum of $10,000.

If you buy the shares by Feb. 29,
you can use the credit in either the
preceding or current tax year. If

¢ >

you made the $7,000 investment
mentioned above, you’d probably

apply. all $1,400 of the available

B.C credit to your 1991 taxes: the
sooner you get your tax break, the
better.

So, that $7,000 investment
would give you a $2,100 tax credit
for 1991 and a $700 break in 1992.

That means you have, in effect,
laid out only $4,200 of your
money to have a $7,000 invest-
ment.

But, warns the prospectus: “An
investment in shares is speculative
and appropriate only for investors
able to make a long-term invest-
ment.

“There is no guarantee that an
investment in shares will earn a
specified rate of return or any
retum in the short or long run, and
investors in shares must be pre-
pared to lose their investment.” If
you should have any losses say 10
years from now, you will have long
forgotten the tax credits you got
today.

In the-first year, said Levi, the
fund will have 100 per cent of its
money invested in T-bills and
similar money market instruments.

Ensure you understand before invesiing

In the second year, about 90 per
cent will be in the money market
while 10 per cent will be invested
in operating small to medium-
sized businesses in B.C. — the
reason for the fund. In the third
year, the guaranteed portion of the
fund drops to 80 per cent, and so
on.

You are locked in for eight years,
although the money is available
(you pay an administration fee) if
you become disabled, involuntar-
ily unemployed or bankrupt or if
you die. If you retire, you can also
redeem your shares — but you
must then repay the tax credits.

“We hope to be able to change
the rules in the future to allow
transfers, so people could give or
sell the shares to one another
during the lock-in period,” he
said.

The fund has no track record. So
in the early years you will be
relying on the skills of those who
are running the fund.

Federal or provincial rules could
change, affecting both the tax
breaks and the viability of the
fund. :

Investment dealer Levi said the
shares will be sold only by stock
brokers and mutual fund agents,
“who should be able to advise
people on the suitability of this

investment for them.” Still, these

brokers and agents are salespeople,
so be aware of any potential sales
bias.

Mike Grenby is a Vancouver-
based columnist and independent
financial adviser who works with
individuals; he will answer you
questions as space allows — write
to him clo The Review, 9726-First
St, Sidney, B.C., V8L 3C7.

Little League hits homer with new park
bul Lions sirike out with 100-year wall

__ by Girard Hengen
~Y The Review

One community group scored
big, while another is hoping not to
strike out in its dealings with the
Town of Sidney.

Town council has voted to sup-
port Sidney Little League’s initia-
tive to construct five baseball dia-
monds on land leased from the
Victoria airport.

Aldermen voted Jan. 27 to allow
a lease to be held jointly by Sidney
and North Saanich.

This means no tax exemption
bylaw is needed, the spending of
money does not have to be treated
as if it was a grant and mainte-
nance costs could be shared
between the two municipalities.

Aldermen also decided to have

~g@ ‘own representatives meet with

their counterparts from North Saa-

| nich and Little League to deter-

mine responsibility for mainte-

nance, which is expected to cost
$30,000 a year.

Little League would have exclu-
sive rights to the fields during
baseball season in the spring, and
have a say in how it is operated
through the balance of the year.

North Saanich council agreed to
similar conditions in December.

The decisions mean Little
League has rounded third base and
is heading for home in its bid to
build its field of dreams.

The organization estimates the

e- cost of building the five diamonds
¢ | ™ off Canora Road at $375,000. It
expects to receive about $113,000
of that in volunteer labor and

G

materials.

Of the $262,000 balance, Little
League has received $50,000 from
Sidney Rotary and a $125,000 Go
B.C. grant. The remaining $87,000
has to be raised in the community.

The Town budgeted for a capital
expenditure of $20,000 in 1991,
but the authority to spend this ran
out at the end of the year.

Aldermen voted to refer making
another commitment for this year
to 1992 budget deliberations.

While Little League hit a home
run with council, the Sidney Lions
club is still hoping to make it to
first base in its proposal to build a
Centennial Wall at the Port Sidney
Marina.

The club wants to sell individ-
ual, corporate and memorial bricks
which would cover the retaining
wall at the port. Proceeds are
earmarked for a new community
centre in the town.

A council committee supported
the project in principle in Novem-
ber, but referred it to staff.

Parks superintendent Jonathan
Kelly reported to council that the
benefits include improving the
look of the wall and providing
money for a new centre.

The disadvantage “is primarily
one of aesthetic judgment.
Inscribed bricks may not be every-
one’s idea of an attractive wall
facing,” writes Kelly.

Acting administrator Paul
Edgington told council he shared
these concems, saying he did not
feel it would be appropriate to have

“a corporate or memorial “‘bill-

board” around the port.

“A memorial wall might have a
rather somber effect on what is an
otherwise bright, cheerful loca-
tion,” he said. ““Without some
restrictions or controls the corpor-
ate tiles might present a less than
aesthetic appearance.”

Ald. Don Amos said staff
should meet with representatives
from the Lions club to share their
concems and see if they can find a
workable solution.

Council agreed, with Ald. Ted
Daly saying he approved the pro-
ject despite the opinions of staff.

He said the proposal would
teflect Sidney’s history, and ‘‘a
memorial wall or memorial bricks
may not necessarily mean some-
thing somber.”

A Lions club spokesman told
council as little as 10 feet of the
280-foot project would be used as
a memorial.

TheReview Wednesday, February 5, 1992 — A19

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