Mayor Don Iveson says there is “serious risk” that the West LRT project will not go ahead. He was reacting to a Global News report Wednesday over a new 90-day clause in legislation that says the Lieutenant Governor can pull funding without cause and the transportation minister can change terms and conditions.
According to the 2019 provincial budget, Calgary will receive the only LRT money over the next four years, just $75 million of the previously-committed $550 million by 2022-23. Edmonton will begin to receive project funds after the four-year budget period.
However, Bill 20 contains language that indicates there is no funding agreement in place for Edmonton. “Funding agreement” means a future funding agreement that may be entered into between the Crown and the city of 98 Edmonton for the purposes of the construction of a Light Rail Transit project.”
“At first blush, it looks like there are some very serious new hurdles in the way for this project, which is at odds with the premier’s commitment earlier this week to support us in building it,” Iveson told reporters Thursday, pointing out the contradiction between Kenney’s State of the Province Address to the Edmonton Chamber of Commerce on Tuesday, and Wednesday’s tabling of Bill 20.
“Hopefully we can get some clarity on this and get some reassurance that the path is going to be cleared to build this project without additional hurdles.
“Cash flow is one thing but law that says the minister can pull the plug — that doesn’t send a lot of confidence to the marketplace at precisely the time we’re trying to bring investment to our city and to our province.”
“At a time when we’re trying to attract investment, that’s not helpful.”
One year ago, the Rachel Notley NDP government committed $1.04 billion towards the west leg of the Valley Line and an additional $131 million towards the expansion of the Metro Line to Blatchford.
Iveson says, on one hand, the premier said in his state of the province address that the project is going ahead and that provincial money will be backloaded for LRT in 2027 and beyond.
On the other hand, Iveson is nervously pointing to wording in the Bill 20 legislation that says the province could pull funding — without cause — on 90-days’ notice.
Iveson said the contradiction will scare away investors.
“That’s really the source of the uncertainty. Legislation that trumps an agreement between our governments that is already in place.”
The size and value of the projects — hundreds of millions of dollars, for instance — only add stress.
For instance, a developer has a rezoning application in to build 1,000 apartment units where the Safeway and Shoppers Drug Mart Mall is at 149 Street and Stony Plain Road.
Iveson said he’s worried about the real estate industry being scared away from investing development dollars as well.
“At different times, governments have put different limitations on different funding agreements,” he said.
“But you can’t take a $2-billion project to market with a 90-day guillotine clause in it.
“That’s never been part of the discussions with us up to the point where the legislation dropped. So we knew nothing about that coming. And it does represent material uncertainty for procurement that we’re going to have to address.”
City of Edmonton lawyers and procurement officials are pouring over the bill, trying to get a straight answer. City council will receive an update on Nov. 5, in a council meeting that will be full of budget implications on several fronts.