PCs promise to review funds in ‘needlessly complex’ stadium deal

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This article was published 04/01/2016 (3600 days ago), so information in it may no longer be current.

Manitoba’s Progressive Conservatives say they’ll re-examine the financing for Investors Group Field if they’re elected this spring, with an eye to reining in ballooning interest charges on what initially was a $160-million loan.

According to University of Manitoba financial statements, the principal and interest outstanding on the primary stadium-construction loan was $186.7 million at the end of March. That figure was $8.3 million more than it was the previous fiscal year due to additional interest charges.

The maximum possible payments against the loan in 2015, by the city, province and Winnipeg Football Club, amounted to $5.8 million. While the Winnipeg Blue Bombers met their obligation to contribute $4.5 million, that sum was applied against a separate $10-million loan taken out by Triple B Stadium, the shell company that owns Investors Group Field.

As well, the combined city and provincial contribution of $1.3 million in 2015 fell short of business-plan projections. The Selinger government blames it on Winnipeg retail market conditions, as the city-provincial contributions are equal to the property taxes generated from the former Canad Inns Stadium site, whose redevelopment is thus far limited to an empty former Target store.

Nonetheless, the prospect of the combined principal and interest on the loan growing to the point where it cannot be repaid has the opposition Tories vowing to look into the financing deal if the party forms Manitoba’s next government on April 19.

“At that point, we’ll have to see whether there’s a better way to do this,” Progressive Conservative infrastructure critic Reg Helwer (Brandon West) said in an interview.

He called the deal to finance Investors Group Field needlessly complex. It calls for the Winnipeg Football Club to first pay the principal and interest on Triple B Stadium’s $10-million CIBC loan and then pay off $85 million of the $160-million stadium-building loan. The city and province are responsible for the remaining $75 million of the principal, using property taxes from the old stadium site.

The agreement also calls for the city and province to assume all the interest on the $160 million until Dec. 15, 2017, when the Bombers will then be responsible for interest on their portion of the loan.

The financing deal also included $30 million worth of grants from the city and province and $8.5 million in additional provincial spending. The running cost of the stadium to date, including construction and financing charges, is no less than $235 million.

“There were too many people involved, too many levels and that makes it difficult for the public to follow,” Helwer said. “This should be easy for the public to understand.”

The Tories have called for an audit into the stadium project, which is also marred by a construction lawsuit that may determine who will pay for $35 million worth of repairs underway at the stadium, which suffers from cracked concrete, improper drainage and other issues.

Premier Greg Selinger has stated the provincial auditor is free to decide what to examine.

Manitoba’s Liberals, meanwhile, are opposed to a stadium audit. “This would simply spend money unnecessarily to establish what we already know,” said Mike Brown, communications director for the Manitoba Liberal Party.

Brown said the stadium project serves as a lesson regarding how not to fund public works. “The stadium is an asset for the province, but the government clearly doesn’t take the public purse seriously or it would have been more diligent with costing and financing of the stadium in the first place,” he said.

No one within the Selinger government was available for comment. Triple B Stadium chairman Andrew Konowalchuk declined to comment.

bartley.kives@freepress.mb.ca