Port Moody residents will soon have their say about whether the city should borrow up to $16 million to rebuild Fire Hall No. 1.

This burning question will be addressed in an upcoming referendum, pending approval from the inspector of municipalities.

The existing fire hall was built at the intersection of Ioco Road and Murray Street in the early 1970s, when about 11,000 people lived in Port Moody. Forty years later, the population has tripled to more than 33,000, and the current facility is no longer big enough.

According to a staff report, the fire hall also has structural issues and does not meet current B.C. building code standards as a post-disaster building.

To build a new fire hall, the city will need to borrow about $16 million over a 30-year term through the Municipal Finance Authority, at an interest rate of 4.81 per cent. The city would need to pay $1,054,882 per year in debt service, which includes interest, financing and repayment.

For the average household, this equates to $58.51 per year for the 30-year term, equivalent to a four-per-cent tax increase.

For Mayor Joe Trasolini, a new fire hall is long overdue.

"I don't think you'll find any resident that has been in Port Moody for any length of time that hasn't been aware of the need of a new fire hall," Trasolini said Wednesday.

"It's a seismic issue. If there's any threat of earthquake, the problem of the equipment being damaged is a very real fear. There's cracks on the concrete floor. There's cracks on the walls. We've been aware of that. We invested a little bit of money in trying to do some upgrades a few years back, but it's temporary repairs. They needed it yesterday."

However, Trasolini is also aware of the project's potential financial impact on taxpayers.

"I don't want to minimize the need nor do I want to minimize the economic situation that we have," he said. "We are trying to reduce the amount of tax that people have to pay. At the same time, it would not be responsible of us as civic leaders not to start the wheels of replacing a much-needed fire hall, which is an infrastructure that addresses the safety needs of the community."

Council approved a $40,000 referendum budget to cover costs for voting, as well as for communications and advertising. If the bylaw is approved by referendum and the city borrows the funds, construction is expected to begin in early 2012.