A disagreement over funding the city’s share of upgrades to Budweiser Gardens led to a lengthy back-and-forth between councillors on the Corporate Services Committee.
The $33.3 million proposal would include two construction phases, the first focused on customer-centric enhancements ($15.1 million), and the second phase dealing primarily with so-called “back of house” enhancements ($18.2 million).
A cost sharing partnership between the municipality and venue operator OVG360 would see the city cover 80 per cent of the total reinvestment.
Co-Chair of OVG360 Peter Luukko explained to the committee that upgrading the public areas and expanding the backstage space will allow Budweiser Gardens to continue to attract national and international events.
“Whether it’s curling, or the Memorial Cup, or any music awards, we need more space because now the bids have changed,” Luukko said.
If council proceeds with the first phase, civic administration recommends that the $9 million contribution be financed by debt, and paid back with annual earnings from the 4 per cent Municipal Accommodation Tax (MAT) charged on hotel rooms.
Funding the second phase would be considered during multi-year budget deliberations in early 2024.
However, a motion by Councillor Sam Trosow sought to also send the phase 1 funding request to budget deliberations where it would be evaluated against other municipal spending priorities.
“Moving phase 1 ahead of that line is unfair, and it’s a distortion of why we have a multi-year budget,” Trosow asserted.
Downtown Councillor David Ferreira seconded the motion, “We’re just looking for a bit more information when it comes to a large financial investment that you are asking for from the city.”
Ferreira also expressed concern that based on current hotel tax revenues, repaying the debt over a decade (or more) would greatly reduce the amount of money available for other tourism infrastructure investments.
“We’re left with about $600,000 [each] year without much wiggle room, that’s where my concerns are,” he added.
Mayor Josh Morgan proposed a compromise.
He directed city staff to prepare an agreement with OVG360 for future consideration by council, and prepare a review of the financial business case, including the city’s anticipated return on investment (ROI) expected from each phase compared to simply continuing with the current agreement.
“If you still want to kick it down the road to the multi-year budget process, you could,” Morgan explained. “But I would like to get the process moving.”
Trosow and Ferreira were satisfied after receiving verbal confirmation from the city treasurer that the first phase not proceed unless council endorses the agreement that will return to the committee later this year.
After the CSC meeting, Deputy Mayor Shawn Lewis pushed back on Councillor Trosow’s concern that approving phase one before multi-year budget deliberations is “unfair”.
“I’m never concerned about deciding on a tourism infrastructure reserve fund item outside of the multi-year budget,” Lewis told CTV News. “That has been our practice since the municipal accommodation tax, or the hotel tax, has been brought into place.”
But Trosow maintains that budget deliberations allow a fair evaluation of all the spending requests in light of council’s limited financial resources, “The multi-year budget is a very democratic institution and it allows rival claimants, as well as the public, the opportunity to compare different proposals especially when we are dealing with limited resources.”
Council will consider the committee recommendation on June 6.
