B.C. open to Vancouver's plea for $458 million
City seeks urgent funding to finish Olympic village
By Jonathan Fowlie , Vancouver Sun
The B.C. government will consider changing the law to help Vancouver borrow $458 million for the Olympic village development if the city meets certain requirements, The Vancouver Sun has learned.
On Monday, city council unanimously passed a motion asking the province to change the Vancouver Charter to give the city financing powers to pay for the project, which is set to run out of money for construction next month.
Premier Gordon Campbell declined to comment on the proposal Monday, but a letter obtained by The Sun shows that Mayor Gregor Robertson e-mailed him a week prior, on Jan. 5, to ask about making the changes.
Two days later, Community Development Minister Blair Lekstrom responded, telling Robertson the province is willing to act quickly, but that the city first must take three steps:
* Pass a formal resolution requesting the amendment, which city council did Monday.
* Develop an agreement with the province on the precise wording of the legislation.
* Provide a "financial analysis of the fiscal implications for the City of the increased borrowing."
"I know you understand how unusual this request is but you may rest assured, I take your request very seriously and will get you a decision on this as quickly as possible," Lekstrom wrote in his response, dated Jan. 7. "However, it is important to note that there is no guarantee that legislation can proceed until it is fully considered and passed by the Legislative Assembly."
The letter was sent to Robertson and members of council and is copied to Campbell, Attorney-General Wally Oppal, Finance Minister Colin Hansen, as well as three top officials in the B.C. government.
Lekstrom makes no reference in the letter to convening the legislature before Feb. 10, the next date it is scheduled to sit.
Robertson on Monday underscored the urgency of the situation, noting that on Feb. 14, the last of a $100-million civic loan to the project developer, Millennium Development, will be exhausted.
The city last week revealed it could be on the hook for the entire billion-dollar Olympic village development after the project's lenders, Fortress Investment Group, cut off funding for construction.
Monday's resolution was an attempt to pave the way for other financing options, although Robertson said the city was continuing to negotiate with Fortress and was not negotiating with other lenders.
Changes to the Vancouver Charter would be necessary because civic legislation requires the city to go to voters in a referendum to approve capital spending, Robertson said.
The city wants the province to change the charter to allow it to bypass the referendum requirement in the instance of Olympic village financing, Robertson said. He said the city needs $458 million to finish the project.
Monday's council meeting was held following Robertson's fall election campaign promise to provide transparency around the project.
Although Campbell declined Monday to comment on Vancouver's request, he said he first became aware of the current problems with the Olympic village around Christmas when Robertson called to say he had some "challenges" and that he was trying to get to the bottom of the situation.
The premier said the mayor has since been working with Victoria toward a solution, but he believes it is not the role of the province to oversee projects undertaken by municipalities. He also rejected the suggestion that the province should have been involved, given that this is an Olympic-related project.
Prime Minister Stephen Harper said Monday he has ruled out giving Vancouver a bailout for the Olympic village, saying "not another penny" will go toward the Games other than for revised security costs.
"The federal government will not be financing cost overruns with the Olympic village," Harper said while in Surrey for an infrastructure announcement.
Meanwhile, New Democratic Party leader Carole James said she would support a special legislative session, especially in light of her concerns about Olympic spending.
"I want to see the specifics. I've had no indication about whether this is one-time, whether it's precedent-setting or what kind of legacy will be there for the taxpayers of Vancouver if they take on this debt," she said. "I think all of those questions would have to be answered."
James said she also wants a full review of all Olympic-related projects. "We'll be taking a look at calling for an independent review of all Olympic spending, whether that's the auditor [general] who does that, or whether it's an independent person who comes in to do that, I think it's past time," she said.
jfowlie@vancouversun.com, with files from Jeff Lee, Lori Culbert and Catherine Rolfsen
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