OttawaAn audit committee meeting erupted in commotion Tuesday as Ottawa city councillors weighed the risks of proceeding with the Lansdowne 2.0 redevelopment project.Auditor general pinpoints cost overruns as greatest risk facing redevelopment projectListen to this articleEstimated 4 minutesCity councillors got their chance on Tuesday to ask Ottawa’s auditor general about her recent analysis of the latest plan to redevelop Lansdowne Park, including its north-side stadium seats. (Francis Ferland/CBC)An audit committee meeting erupted in commotion on Tuesday as Ottawa city councillors weighed the risks of proceeding with the Lansdowne 2.0 redevelopment project.The main point of contention was Auditor General Nathalie Gougeon’s finding that there’s an “opportunity cost” to the city in setting aside $17.4 million per year to service debt on the project.Capital ward Coun. Shawn Menard, a leading critic of the project, pushed staff to acknowledge that Gougeon’s finding was tantamount to saying that the city could spend that sum on other priorities. He pushed them to answer yes or no.“We’re getting the runaround on this,” Menard said.Cyril Rogers, the city’s chief financial officer, said that wasn’t a fair question, since Lansdowne 2.0 is expected to generate revenue to offset the costs, and that money wouldn’t be available if the project doesn’t proceed.Menard pushed again and again, until audit committee chair Cathy Curry cut him short and he began exchanging words with his neighbour, Beacon Hill-Cyrville Coun. Tim Tierney.“I was just called a swear word by my colleague here next to me,” Menard said, pointing at Tierney.“Emotions are running high,” Curry said.Capital ward Coun. Shawn Menard speaks at a committee meeting last month that also tackled the subject of Lansdowne 2.0. (Francis Ferland/CBC)Forecasts called ‘too optimistic’Amid the outbursts, councillors questioned Gougeon on the wide-ranging risks facing the $419-million redevelopment project, including the chance a major source of funding could dry up.Mirabella Development Corporation, which has bought the rights to build the towers over the development for $65 million, is only putting up a $1-million deposit upon signing. “The clauses within the purchase and sale agreement with the air rights allows Mirabella to pull out with a low cost,” Gougeon said. She also focused on forecast profits from the Ottawa Redblacks, saying the financial assumptions underlying them “might still be a little too optimistic.”But that’s not the worst of it. Ottawa Auditor General Nathalie Gougeon at a city meeting Feb. 22, 2023. (Jean Delisle/CBC)“The greatest risk is cost overruns,” she said. “Every dollar in excess is a dollar that the city is responsible for covering and in turn will be a cost that the taxpayer, indirectly, is covering as well.”That’s because the city would be on the hook for construction delays if it’s responsible for them, and also because the added cost of new or expanded tariffs could be passed on to the city.“This project has a significant likelihood of being higher cost, and we want taxpayers to understand that as well,” Gougeon said. “And then it’s up to members of council to decide if that’s something they’re comfortable with.”But Curry, the committee chair, said she was reassured by how city staff are responding to the report. They’ve accepted all of Gougeon’s recommendations and are promising regular updates to council on the project’s finances and construction progress.“Nobody can prepare for all the risks,” Curry said. “Nobody could have predicted a worldwide pandemic and that impact on Lansdowne 1.0, but the key is, as a council, what you do to have oversight. You make sure you are apprised of all the risks.”Deputy treasurer Isabelle Jasmin said the city has run the numbers and she’s confident the project still makes sense if risk turns to reality.“This is a balance between risks and returns,” she said. “We looked at some way-out scenarios —what if construction costs were 50 per cent more than we expected? — and the results were still positive.”ABOUT THE AUTHORArthur White-Crummey is a reporter at CBC Ottawa. He has previously worked as a reporter in Saskatchewan covering the courts, city hall and the provincial legislature. You can reach him at arthur.white-crummey@cbc.ca.
Raucous audit committee meeting debates risks of Lansdowne 2.0
