Exhibition Hall at Westerner Park. (rdnewsNOW file photo)

By Josh Hall (Twitter: @Vancan19)

decision postponed

Council conundrum brewing as Westerner Park financial aid decision delayed

Apr 22, 2021 | 6:31 PM

Red Deer city council is taking more time to decide whether to approve a $22 million deal to keep Westerner Park alive.

At a special meeting held Thursday, council voted to table a vote on the financial bailout pending more information.

Had council approved the deal up to $3 million would’ve been made available this year on as-needed basis, with the other $19 million becoming available in subsequent years on a loan basis, repayable over three decades.

The City of Red Deer took over financial oversight of Westerner Park in January 2020. An ensuing Deloitte report identified more than 30 opportunities for the non-profit to return to financial wellness, with a timeline of two to 10 years before doing so.

Many of those measures, such as establishing a Westerner Park-operated foundation, have already been achieved.

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The audit showed no financial misappropriation or fraudulent activity, but poor decision-making when it came to new infrastructure such as Exhibition Hall, and a lack of good internal processes and communication.

Council voted 7-2 Thursday (Dianne Wyntjes & Michael Dawe dissenting) to table the matter in order for administration to explore several more options.

City Manager Allan Seabrooke said this is problematic on multiple fronts, firstly because council had the city manager’s report on the matter a week ago explaining the pickle the City and council would be in by delaying approval.

“We felt the report was comprehensive and that it was supported by solid background data, and we’re definitely disappointed council chose to table when we did not believe that was necessary,” Seabrooke suggested. “We believed they had all the answers and information needed to make an informed decision.”

Part of the proposal is to pay off Westerner Park’s debt at CIBC, and initiate a loan for the non-profit organization with The City. CIBC would be paid off during the summer and The City would apply to the Government of Alberta for borrowing to start the loan.

Chief Financial Officer Dean Krejci says that timeline is now in jeopardy.

“In order for us to be able to borrow money from the [provincial] government, we’d have to apply to them by July 30. If council had done first reading of the borrowing bylaw today, we’d have had a valid borrowing bylaw in place by July 8,” he said. “By pushing it back four weeks, we will not be able to apply to the government for our September borrowing.”

Krejci added this paints council into a corner in the sense they’ll likely now have to approve an interim grant for Westerner Park anyway in order to continue operating past May, which is when their current money will run out. With a potential borrowing bylaw being pushed into August, the next round of approvals for borrowing would take the process into December.

Westerner Park currently spends about $400,000 monthly for site upkeep and some staffing, Krejci shared. Therefore, an interim grant will likely run The City of Red Deer between $500,000 and $1,000,000.

The Westerner’s need for City money in 2021 would be alleviated if they’re able to host Westerner Days, which remains up in the air due to the pandemic.

Councillor Vesna Higham proposed the tabling the matter, asking administration to come back with information on several items.

Chief among them are options for structuring the up to $3 million in 2021 as a loan as opposed to a grant. She also wants Westerner Park to be solely responsible for the $500,000 cost of a consultant-led Westerner Park asset assessment. It’s currently proposed The City would pay half.

Higham is also asking for details on allowing confidential Westerner information to be shared with council members, making council the approving authority for any future revisions to the plan, and exploring with CIBC a longer extension until April 1, 2022.

Councillor Lawrence Lee wants administration to look at the possibility of the City’s nomination process being used to appoint a member to the Westerner Exposition Association’s board, while Councillor Dianne Wyntjes wants to know more about adding one public member to the Westerner board by way of City appointment. Council currently has two members on the Westerner board.

Council also heard the proposed plan would not impact taxes, The City’s investments would be protected, and that it would hold Westerner Park accountable while enabling a flexible payment schedule and giving Westerner Park the best chance possible to regain financial footing.

Once past first reading, which will come back to council within four weeks, there would be a Municipal Government Act-mandated 15-day public petition period and opportunity to appeal through Court of Queen’s Bench if any member of the public objects to the aid package.