To the editor:
I’ve been growing increasingly dismayed with the level of misinformation and factual errors from the NO side of the West Kelowna City Hall & Civic Centre Referendum campaign, particularly in the letters to the editor by the NO side’s campaign sponsor/financial agent, Ian Graham, and supporters of the NO side and in their paid advertising. In spreading this misinformation and factual errors, it would seem the NO side is attempting to manifest the kind of division within this community not seen since the “dark days” when the RDCO Electoral Area G (as it was then known and represented neighbourhoods like Lakeview Heights and West Kelowna Estates) had a coordinated campaign against the building of the Johnson Bentley Memorial Aquatic Centre that ultimately ended up with their opting out of its financing.
One of the consequences of that misinformation being spread by this campaign’s NO side was evidenced in a letter to the editor in that same issue of the Westside Weekly where a letter writer, who seemed to be leaning to the NO side, suggested the old Zellers building as a potential city hall. I realized that I couldn’t sit quiet anymore and thought I should write this letter that seeks to clarify that misinformation, particularly in three key areas, namely on the financing/cost, on the location and on the type of governance structure for the proposed city hall and civic centre.
First, on the financing/cost side, the numbers thrown about by the NO side area grossly fabricated — it’s as if the NO side has just pulled numbers out of the air. Yes, the City of West Kelowna is partially drawing from reserve funds to help finance the municipally-owned portion of the city hall. However, I can guarantee you the amount of “lost (deposit) interest” on those reserves is not anywhere close to the $3 million they are quoting. Commercial and institutional bank deposits do not pay anywhere close to the same rate of interest that a retail deposit might on their personal deposits. The only way the city would’ve likely achieved the return quoted on the drawn down reserves would be if the city had dramatically shifted their reserves into potentially higher-yielding investments such as publicly-traded stocks or ETFs, at a much greater risk, and if that’s what the NO side would prefer to the construction of a necessary city hall, then that begs the question, why would we want a local government to be investing their reserves in the stock market instead of building out municipal infrastructure and stimulating the economy, both of which this project would achieve?
Second, on the location side and to, hopefully, put to rest that there are other “less costly” pieces of municipally-owned land or established vacant buildings within the city once and for all, the old Zellers building — while empty, yes — is not unoccupied. Hudson’s Bay Company remains under long-term lease agreement with the property’s owner, the publicly-traded Artis REIT which also owns a majority share in the Westbank Hub and Westbank Hub North shopping centres. It likely has it advertised for sublease for the remainder of that term but, like leasing any property, the city evaluated the prospect of leasing versus buying and found that it would cost nearly double each year to lease versus financing & buying its own building. In addition, the city would still have to pay substantial amounts in tenant improvements and, at the end of their lease, they could either abandon the building and have to finally build something else, leaving the building’s owner with some pretty nice tenant improvements with which to market the building or renew the lease agreement at higher market rates. It is also within another local government’s boundaries, the Westbank First Nation, and would be totally inappropriate for the city to sublease a higher cost commercial building within their boundaries and also have to pay property taxes to the Westbank First Nation (although, I’m sure the Westbank First Nation would have no issue with this).
Other location(s) suggested have included the Bartley Road location of the city’s operations department or the Dobbin Road location. The Bartley Road location is in an industrial area and its parcel is far too small. As well, once the city hall is built, the city could likely pursue the sale of the Dobbin Road location and consolidate its operations department between the new city hall and the Bartley Road location, likely generating several million dollars with which it could put back into the city’s reserves. It would also be inappropriate for the city to buy additional valuable land in the West Kelowna business and industrial park area on Stevens Road as that is one of only a few growing commercial districts of the city, which allows the city to diversify its revenue sources more broadly from an almost exclusively residential tax base.
And, finally, on the type of governance structure, a NO side supporter named Doug Waines stated emphatically a NO to public-private partnerships (P3). I’m not going to debate the pros and cons of P3s but this is absolutely not a P3. P3s typically involve a government engaging a private sector consortium to design, build, finance and operate/maintain publicly-owned asset for the long-term with government making fixed annual payments to the consortium for that timeframe. This is very much a traditional bid opportunity where the city basically designs the municipally-owned city hall in conjunction with the private sector owner and, once built at the developer’s cost, the developer agrees to sell the city hall to the city at a fixed price. It’s very much a simple commercial real estate transaction. (As an aside, other NO side supporters bring up the Royal LePage Place which was more of a design/build opportunity; however, that was run under the Regional District of Central Okanagan, not the city, which delivered the West Kelowna RCMP Detachment on time and under budget.)
In summary, while I, like many of the NO side supporters in the city hall referendum, supported amalgamation with the City of Kelowna in 2007, that did not happen. Interestingly, one of the reasons I preferred that option was the efficiencies of scale and that a city hall wouldn’t then be needed. However, I have moved forward. The will of those that voted in 2007 was for incorporation and one of its most fundamental functions is to have a city hall to serve as an administrative and economic “centre” and that “centre” should be in its geographic centre, in or around the downtown which would drive economic development. There are a number of pending proposals for office complexes and mixed-use retail and residential buildings in or around the downtown. A NO win would likely cancel these and force the Westbank Centre area on Main Street and Brown Road to continue looking like a small, rural town, like Merritt or Enderby (no offence to those towns — they are nice, quaint little towns with small populations). These are not out of town developers — they are locally-based who live and work in this region. Let’s move forward on this — it will cause no new taxation that isn’t already budgeted for in the city’s Capital Plan nor would it affect the future Lakeview water utility’s water treatment plant construction, which is paid for by ratepayers and from senior level government grants. And, despite claims by the NO side that a “no” would cancel this much needed city hall, the city does have other options at its disposal, which include leasing and which wouldn’t require elector assent, it’s just this 20-year borrowing plan is the lowest cost and takes advantage of historically low interest rates which I view are likely to remain low for a long time given the country’s shifting demographic and other structural challenges. We must vote YES for progress and to begin moving forward.
Doug Mehus, West Kelowna