Some housekeeping in the finance department has revealed the final cost of the 2009 Grizzly Plaza extension project.
A May 25 report from finance director Graham Inglis pegs the total cost to extend the Mackenzie Avenue plaza from First Street to Third Street with new planters, sidewalks and bricks at $1,030,000. The final cost is below the original estimate of $1,328,485.
Inglis’ May 25 report relates to converting temporary borrowing for the project into a long-term loan with the Municipal Finance Authority of B.C., or the MFA. The MFA is a provincially-regulated authority that provides lending to regional districts and municipalities.
In 2009, the city passed a bylaw that authorized them to borrow $600,000 temporarily for the project. The report from Inglis contains a recommendation to borrow $445,000 from the MFA. “It will be noted that the amount needed to be borrowed is less than the amount budgeted by $155,000,” states the staff report. “This will amount to annual savings of about $12,500 in principal and interest payments.”
The Grizzly Plaza extension received final approval in 2007, but had been planned and discussed for many years before that. The construction project began in 2009 and caused much controversy when it ran approximately six-weeks over schedule. Shopkeepers on Mackenzie Avenue complained of lost business during the peak summer season and criticized city hall for poor communication on the project. A batch of faulty bricks added insult to injury for city hall; the bricks at the intersections were crumbly and had to be ripped up, temporarily paved over then replaced later with new ones.
The total cost for the project was estimated at $1,328,485, of which $1,050,000 was for surface works not related to the community energy project extension. New pipes that extended the reach of the city-owned Community Energy System were installed under the street at the same time the beautification and enhancement project was done.
$500,000 was raised through outside funding sources, and the city opted to borrow $600,000 temporarily to move forward with the project. The temporary borrowing was deemed necessary; time was of the essence since some of the funding received by the city stipulated a construction start date in the spring of 2009.
That borrowing was subject to a counter-petition in the beginning of 2009. A total of 359 electors voted to oppose the borrowing, which was short of the necessary 374 votes (or 10 per cent of electors) needed to block to borrowing.
However, the city could have moved forward with the project by seeking an alternate form of funding.
Council will discuss the plan to convert the borrowing to long-term debt at their June 14 meeting.