Phil Tank: Saskatoon will get solutions on area district value, how one can pay

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Throughout Saskatoon’s arduous five-year journey since metropolis corridor determined to concentrate on a brand new downtown area, two huge questions have resonated.

Folks need to know the way a lot the challenge will value and the way town proposes to pay for it.

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We now have partial solutions after town revealed a 60-page report by the well-regarded consulting agency KPMG outlining choices for financing the sector district.

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And no, “Tax Saskatoon property homeowners again to the Stone Age!” was not among the many choices, as lots of the frantic voices within the debate over a downtown leisure district would have you ever imagine.

The choices outlined all entail some monetary threat, however so would any plan, together with letting the present remotely positioned area, SaskTel Centre, deteriorate and grow to be a legal responsibility.

We nonetheless lack a present value estimate and the current expertise with inflation within the public sphere in Saskatoon suggests the five-year-old estimates of as a lot as $178 million for a brand new downtown area and $88 million for a brand new conference centre have been left within the fiscal mud.

The Saskatoon Public Library simply paused its plan for a controversial new $134-million downtown department after development bids got here in “considerably” larger than finances.

So whereas we don’t but possess an up to date price ticket for this district, we do know extra about how town plans to pay for it. The report stems from a council request for choices with minimal impression on property tax.

The report acknowledges the whole value of the district to exceed $500 million with town estimating its share within the $350-million to $500-million vary.

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5 completely different choices are proposed for elevating the income wanted, 4 of that are pretty easy. If all 5 had been applied, they’re anticipated to boost about $572 million over 25 years, though that quantity could possibly be as excessive as $966 million or as little as $271 million.

One easy possibility used all through Canada, together with at Regina’s Mosaic Stadium, is so as to add a charge to tickets bought at a venue to assist elevate cash to pay for it — your fundamental consumer charge.

Growing parking charges and hours can also be recommended. Taxes on short-term lodging and automotive leases are proposed as different financing instruments, however each would require a change in provincial guidelines.

Nonetheless, the choice that will elevate probably the most income, but in addition entail the best unpredictability, is named tax increment financing. That includes making use of the rise in property taxes from new improvement adjoining to the brand new facility or amenities to assist pay for it.

For some, this has grow to be the holy grail of funding for area initiatives, as a result of, in concept no less than, you’re solely utilizing the additional income generated by the facilities added to a district. Then, as soon as the financing is paid, that income goes into common coffers so everybody advantages.

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Critics query whether or not the event and funding may need occurred with out the sector, however this strategy has additionally been utilized in Calgary, Edmonton and Winnipeg.

Specifically, it’s tough to dispute the success of Edmonton’s Ice District, which has seen huge funding near Rogers Place, the place the Edmonton Oilers play. However Saskatoon lacks a billionaire NHL proprietor to assist contribute and a sports activities crew with a rabid following.

And for Saskatoon to realize the best profit from this strategy, estimated at $490 million, it will want permission from the province to make use of all property tax, not simply the municipal portion.

Funding for a brand new occasion district can even require monetary assist from the provincial and federal governments.

Saskatchewan Premier Scott Moe stated in 2020 that he would think about serving to to finance a brand new Saskatoon area. Extra not too long ago, he has acknowledged fading help for his Saskatchewan Occasion in city areas.

Final week, Moe dedicated $200 million to a brand new campus for Saskatchewan Polytechnic at Innovation Place in Saskatoon.

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That marks an essential funding in postsecondary training, however think about how far an analogous dedication to a brand new area district would go to make that imaginative and prescient a actuality. To not point out how a lot a provincial authorities would possibly profit politically.

Phil Tank is the digital opinion editor on the Saskatoon StarPhoenix.

ptank@postmedia.com

twitter.com/thinktankSK

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