THUNDER BAY – Thunder Bay’s city council is preparing to vote on a financing plan setting out how the city would pay for a proposed indoor turf facility.
The financing plan envisions the city spending significantly more than it would have on a 2021 Chapples Park build council rejected as too expensive, even while funding a smaller facility with fewer amenities.
Including debt servicing, the plan would cost the city more than $55 million over 25 years.
Several councillors have already ruled out supporting a facility with that kind of price tag, and are instead hoping a competitive procurement process to build a structure beside the Community Auditorium will bring the project's cost well below estimates from city administration.
It will be the third time the city goes to the private sector for proposals on an indoor turf facility meant to accommodate soccer and other sports including cricket, football, and Ultimate Frisbee.
Before the latest procurement process can be launched, however, city staff say council must have adequate financing in place.
Staff have based the financing plan on a $44.5-million Class C estimate for the build next to the Auditorium, prepared by consultant Hanscomb Ltd. and considered accurate within 15 to 20 per cent.
The estimate is for a steel-sided, hangar-like facility that will include a full-size field, but few of the additional amenities considered at Chapples, like showers, a walking track, or spectator areas.
Soccer Northwest Ontario, which has championed the Auditorium-adjacent location and simpler design, has publicly questioned the estimates presented by city staff, expressing confidence it could be built far more cheaply.
Several city councillors who spoke with TBnewswatch suggested it will be difficult to muster council support for a build that comes in above $40 million.
However, some may be willing to support the financing plan for a build of up to $44.5 million on Monday in order to move the process forward. The plan will not bind council to spend the money.
Coun. Kasey Etreni, for example, said in an interview she’d be hesitant to support a project that costs more than $35 million. However, she is open to supporting the financing plan.
“I'm not looking at this report as, ‘This is how much the multi-use facility is going to cost us,’” she said. “I'm looking at it as, this is how much we can afford.”
“Once we start getting in those expressions of interest, that's when we'll start to know if we're going to max out at this number.”
Coun. Michael Zussino said he’d like to see the project come in closer to $30 million. He suggested council might debate lowering the amount targeted in the financing plan on Monday.
“I'm happy that it's proceeding in some shape or form,” he said. “The number is a little high in my estimation, but I think that’s probably the upper limit in terms of how much we want to spend... We'll see how that will play out in terms of the contractors that will be bidding on this and their designs."
Coun. Brian Hamilton said he’s concerned the drive to reduce costs will deliver a lower-quality project that still costs tens of millions.
“It’s important in my mind that we get the most value for our dollars and that we don't skimp on important amenities the community wants and deserves just to get it past the political finish line,” he said.
Instead, he suggested the city might want to return to an option it’s previously rejected over reliability and environmental concerns.
“If we can't do it right, why not just go to an air-supported structure?” he asked. “We could build something for $10 or $12 million, put it at the Chapples site. We could have a walking track and we could serve the community well for 15 or 20 years while we generate the financial capacity to build something we really want.”
The recommended financing plan builds on roughly $18 million the city has already allocated for the project. It suggests committing several million more from existing funds, while relying on $20.9-million in debt financing.
Funding nearly half of the project’s cost with a debenture won’t come cheap: the city is expected to bear about $10.8 million in interest payments to service that debt over its 25-year term.
The additional city funds include $1.2 million in Municipal Accommodation Tax revenues – most of what the city expects to receive in 2024 – and $1.5 million from an upcoming Synergy North note payable.
The financing report also notes council committed nearly $10 million of its indoor turf financing from the Renew Thunder Bay fund, meant to support projects that secure matching contributions from upper levels of government.
Those funds were committed when the city hoped to cover half the project’s cost with a federal grant. The SNO proposal is unlikely to be eligible for similar support, city staff say.
Staff did not suggest withdrawing that $10 million from the project, however.
If council approves the indoor turf recommendation from staff on Monday, that will also direct administration to report back in the first quarter 2024 with the results of public consultation on the new proposal, and preliminary design work by Stantec Architecture.
The city could then launch a call to the private sector for bids to build the proposed facility.
