Advertisement

Lethbridge and District Exhibition makes nearly $7M request to council

The Agri-food Hub and Trade Centre is in dire need of financial support as the Lethbridge and District Exhibition goes before Lethbridge city council to make a hefty request. Global News

It was an ask that sparked a long debate at Lethbridge city council.

After three years of construction and a major grand opening celebration in August, the Agri-food Hub and Trade Centre could be in some financial trouble.

On Tuesday, the Lethbridge and District Exhibition presented a request to council asking for a capital grant in the form of $6,742,315.72, or a capital grant for $2,081,093 to cover unfunded capital of construction with a four-year debt deferral that would be repaid on the back end of the loan, totalling $4,671,309.72.

According to Mike Warkentin, CEO of the Exhibition, the plea for more funding is due to rising interest rates and building-specific operational requirements, and failure to provide funding could be detrimental to the organization.

In August 2020, the original approved project budget was estimated at $70,600,000.

Story continues below advertisement

Broken down, the original budget saw $27.8 million come from the provincial Ministry of Agriculture, $25 million come from the City of Lethbridge and $17.824 million come through municipality borrowing, which was approved by council, with that loan taken on by Lethbridge and District Exhibition.

Get the latest Money 123 news. Sent to your email, every week.

However, as part of the presentation, a report from Warkentin showed annual blended payments have increased by 42 per cent due to interest rate changes, with the current forecasted budget at completion coming out around $77,342,315.

That means the changes since first budgeted include a nearly $350,000 annual variance for interest rates, a $400,000 annual change for building-specific operational requirements and $400,000 in unbudgeted operating expenses for the old pavilions.

The exhibition also says non-direct-expense-related changes include the commercial lease absorption rate being slower than expected and the tourism industry not being fully recovered from the impacts of the COVID-19 pandemic.

It also asked for the City of Lethbridge to immediately take over the old pavilions, excluding the West one.

In May, Lethbridge city council approved a feasibility study to explore the possibility of re-purposing the pavilions for recreational multi-purpose opportunities, with that study to be presented on Dec. 12.

City administration also brought forward a presentation indicating that the ask from the exhibition is much larger than it appears, estimating that the total underlying costs could be upwards of $22 million if it were to approve the total request.

Story continues below advertisement

Following the four-hour presentation in council, Coun. Rajko Dodic brought forward a motion that was then divided and voted upon.

Council has approved a one-year deferral of loan payments owed to the city at a cost of $1.16 million, contingent on whether the province of Alberta agrees to fund the second half of the $2.08-million capital grant request before Dec. 11.

It also approved up to a one-time payment of $500,000 in interim operational funding for the exhibition to maintain the old pavilions and to move forward with a third-party review of the Agri-Food Hub and Trade Centre.

If the province does not respond within the next two weeks, the contingencies in the motion will not move forward unless a councillor brings forward an amendment to the motion during the next scheduled city council meeting on Dec. 12.

Public feedback from the community on the topic can also be given at the assets and infrastructure standing policy committee (SPC) meeting at city hall on Dec. 7.

Sponsored content

AdChoices