City hall wants to pour $20M into True North Square project
Advertisement
Read this article for free:
or
Already have an account? Log in here »
To continue reading, please subscribe:
Monthly Digital Subscription
$19 $0 for the first 4 weeks*
- Enjoy unlimited reading on winnipegfreepress.com
- Read the E-Edition, our digital replica newspaper
- Access News Break, our award-winning app
- Play interactive puzzles
*No charge for 4 weeks then billed as $19 every four weeks (new subscribers and qualified returning subscribers only). Cancel anytime.
Read unlimited articles for free today:
or
Already have an account? Log in here »
Hey there, time traveller!
This article was published 13/03/2017 (2572 days ago), so information in it may no longer be current.
City hall is proposing to redirect almost $20 million in property and education taxes towards the cost of constructing “amenities” associated with the downtown True North Square project.
The city and the province are jointly contributing $16.7 million for streetscaping and skywalk connections for the $400-million four-tower project. The city is proposing to contribute another $3 million towards the construction of the $9-million plaza in the heart of the project and is hoping the cash-strapped provincial government will provide the remaining $6 million.
The government money for the project is coming from tax incremental financing — known as a TIF grant – which redirects the new property and education taxes as a result of redevelopment back to the developer.
“We know downtown is a little difficult to build in sometimes,” Coun. John Orlikow, chairman of council’s property and development committee, said Tuesday when explaining why property tax revenue should be directed to a major private sector project. “The industry needs some incentives to offset the extra costs.”
The funding proposals are contained in an administrative report for Wednesday’s executive policy committee (EPC) meeting. While EPC is expected to endorse the report, it still must be approved by all of council.
The True North Square project was formally unveiled a year ago. It’s a partnership between True North Sports & Entertainment – owners of the MTS Centre, the NHL Jets and AHL Moose – James Richardson & Sons and Vancouver-based Northland Properties Corporation.
True North and Richardson are building the first two towers on the east side of Carlton Street— a 17-storey, 365,000-sq.- ft. office tower, scheduled for completion in July 2018; and, a 25-storey, 245,000-sq.-ft. tower with a mix of retail, restaurants, office space and 145 residential units, to be completed in early 2019.
Northland will construct two towers on the west side of Carlton — a 27-storey, 275-room Sutton Place Hotel and a 17-storey, 130-unit residential complex, tentatively called Sutton Place Residences, to be completed by 2020.
The city hall report states the $20 million in TIF grants will be paid out on an annual basis as the various components of the project are completed and the owners begin paying property taxes.
The largest chunk of public funds — $16.7 million — will be used for street-level improvements surrounding the True North Square development, along Graham Avenue and Hargrave and Carlton streets, and for the construction of elevated walkways linking the four towers to the existing skywalk network.
The $16.7 million was part of a $25-million pot originally set aside in 2012 for street level enhancements in the downtown Sport, Hospitality and Entertainment District (SHED), which is an 11-block area that essentially surrounds the MTS Centre.
John Kiernan, director of the city’s planning, property and development department, said of the original $25 million, $7.4 million had already been spent on streetscaping enhancement in the SHED area. Council will be asked to re-allocate the bulk of the remaining funds to streetscaping and skywalk construction associated with True North Square.
The administrative report proposes the city and the province contribute another $9 million TIF grant for the construction of the plaza. While that money wasn’t part of the original SHED funding, the administration supports the grant in recognition of the $400-million value of the project.
As part of the deal to qualify for the $9-million funding, the administrative report states True North and its partners have agreed to be responsible for all maintenance costs but allow city hall and the Downtown BIZ to treat it as a public space, open to the public at all times, and allow events to be scheduled there.
“A major, gathering downtown space was always being anticipated within the SHED concept,” Kiernan said. “When this came along and there was an opportunity to partner with True North, in essence, that becomes a public plaza space on private property but maintained by the private sector, for public use.”
Allocation of the $16.7 million is considered a formality, as the funding agreement was approved by the former NDP government several years ago.
Kiernan and Orlikow said it’s uncertain if the Pallister government will agree to another TIF grant to pay for the construction of the plaza.
Kiernan said that while the city and province essentially split the first $25-million on a 50/50 basis (education taxes and municipal property taxes), the administration is proposing city hall only be responsible for one-third ($3 million) of the $9 million needed for the construction of the plaza.
Orlikow (River Heights-Fort Garry) said the one-third/two-thirds split is justified on the basis that the province collects a range of taxes during the construction phase of the project (income, sales, payroll) and should carry the larger share of the cost.
Orlikow said the city’s $3-million for the plaza is dependent on the province at least contributing an equal amount, if not the entire remaining $6 million.
“Someone else will have to come up with the other $6 million – we’ve tied our contribution to a maximum of $3 million,” Orlikow said.
Kiernan said if the province balks at the funding share, or any contribution, towards the plaza construction, council will have to reconsider its $3 million contribution.
aldo.santin@freepress.mb.ca