DOLLARS AND SENSE
Published Monday July 28th, 2008
Project Parking lot or corporate HQ? Saint John mayor wants to be sold on Long Wharf deal
SAINT JOHN - Long Wharf at the head of Saint John harbour would be better used as a parking lot than as the site of Irving Oil's world headquarters, says Mayor Ivan Court.
However, Court insists that he hasn't made his mind up about whether he will support a proposal that would see the city sell to Irving the former Lantic Sugar site at the tip of the city-centre peninsula. The company would in turn swap that property with the Saint John Port Authority for the Long Wharf site.
Council must approve the sale of the former Lantic Sugar property or the deal dies.
Looking purely at the revenue side, the port authority would make more cash using Long Wharf as a place to park cars, Court said.
"I said 'that piece of land over there is worth at least a half-million in parking for (the port authority), if it's only about making money'," the mayor said.
"They can take out of context if they want."
Court made the comments as he gave his side of a meeting he had last month with port chairman Stephen Campbell, International Longshoremen's Association business agent Patrick Riley, MLA Abel LeBlanc and others.
Briefing notes about the meeting were obtained by the Telegraph-Journal.
In the notes, which the port chairman distributed to board members and stakeholders, Campbell writes "the meeting did not go well."
"The mayor made it clear he was not supportive of the port offering this kind of option (the Irving Oil proposal) to the community."
Court said his intent is simply to make sure taxpayers get fair bang for their buck from the Long Wharf site.
"I said, 'what's a half-a-million dollars for the next 100 years worth to you? It's worth $50 million in revenue. That would allow you to build something on there and at the same time generate revenues,' " said Court.
City manager Terry Totten, who has recommended that council accept the Long Wharf deal, has said the $30-million Irving Oil proposal will have a "significant effect" on municipal tax revenues, adding perhaps as much as $2 million annually to city coffers. The city currently receives an annual grant from the port authority of $44,000 in lieu of taxes for the property.
If the deal goes through, Irving Oil promises improvements to Long Wharf and the nearby Fort LaTour site, as well as a world-class second cruise ship welcome centre to complement one that is nearing completion at the former Pugsley Terminal on the uptown side of the harbour. The Irving Oil headquarters at Long Wharf would also concentrate 1,000 employees downtown.
But Court has more concerns.
If Long Wharf is lost by the port, the mayor said he fears he'll be going to Ottawa to fight for money to fix piers on the western side of the harbour at the same time as he's looking for federal cash to bring the city's water system up to par.
"They're going to need over $100-million to fix up berths," he said. "My concern is I'm going to need $200-million for the water situation."
He also says he doesn't like the deal based on its terms and conditions.
"If it's a 100-year lease and you can only use it for cruise ships, it ties up this piece of land."
Questions about fair-market value are also on the mayor's mind.
He insisted the city should get a minimum of $1.4-million for the 9½-acres on which the sugar refinery once sat, even though fair market value of the site is estimated at between $750,000 to $1-million.
"If we get less than a million dollars for that piece of land, we're getting shortchanged," said Court.
"I'd like to know how somebody determined that the site was worth $1-million or less," he said.
"Citizens have called me because they thought that down at the sugar refinery site there was going to be a condominium or housing project which would generate millions of dollars in taxes for the citizens of Saint John."
Lantic Sugar transferred the title of its property to the city for $1 in 2003 and reimbursed the city approximately $800,000 for the demolition of the old refinery.
Since then, the city has spent more than $400,000 to remediate the Lantic Sugar site.
"If (Irving Oil is) going to offer us $750,000, take away the $400,000 and at the end of the day we got a net $350,000. I think that's one of the questions I have for the city manager. What is the real value of that site?"
"We haven't really put it out there to find out what somebody else would be willing to pay for it," Court said.
But, in fact, the first suitor for the site was a Montreal-based developer looking to put in a mixed commercial/residential development. The proposal didn't go ahead for a number of reasons, including environmental and access concerns. The second proposal was from Green Space Development Holdings for a $300-million raised horse-racing track, hotel, round reef marine park and other structures. That didn't happen because it would have required additional land owned by the port and city staff believed the port would not make the land available. The Saint John Waterfront Development Partnership and Enterprise Saint John have shown the site to investors, but it has not resulted in further interest.
The port authority's Campbell said that, in its current state, the former Lantic Sugar property will meet any requirements that a working port would have.
"We've been told that to bring that up to snuff for residential or an urban village, additional monies would have to be spent," said Campbell.
"It's because of all these factors that, despite the best efforts of Waterfront and ESJ (Enterprise Saint John) and others, they have not been able in all the time they've had, to come up with a development.
"Developers back away. So its most appropriate use, clearly, is port."
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I honestly believe that if Common Council is partisan enough to vote down the most significant development in this city in decades, then we'll have a controversy that's bigger than the LNG tax deal. It'll become the albatross around this Council's neck for the next 4 years.
Maybe if the Irvings didn~t short change Saint John in the past with their secret LNG deal, then maybe Ivan and the rest would be more willing to negotiate with the Irvings. Keep up the good work Ivan. let them know that the little bit of saint john remaining is not for sale.
What is the difference if tax revenues are increased on long wharf or the Atlantic Sugar site?
Oh, and as far as parking goes, yeah, I'm sure everyone wants to park over on long wharf and walk to work. Heck, they'll do that the same day they choose to leave the car home and walk!
I'm surprised, I thought this Mayor had some intelligence.
We need more taxes from an increased tax base, no more rate increases and this project is a perfct example of how expanding our tax base should be done.
It won't require many of the services residential developments do, such as garbage collection, recreation facilities, etc. so adds little to the operating costs of the city.
Over a $1 million a year in new property tax is nothing to sneeze at -it will almost pay the cost of the latest excessive pay raise to the inside workers for instance.
The city is on a rollercoaster ride right now and we are heading for the top of the ride. Let's not screw up this time like we did in the past.
If the 18 - 20% of Saint Johners who hate the Irvings prevail over the 80% who want to see our city progress and prosper it will be a sad commentary on a city that had a wonderful chance to improve its waterfront and blew it.
If Irving's headquarters move to another part of town, or out of town, a lot of uptown parking spots will be available.
I'd rather park in the lot by the Imperial that will be left empty, than at Long Wharf.
He says he has taxpayers as his main concern - clearly this is not the case as most SJ'ers want this project - this is all about his Irving vendetta and his group of union cronies (whom mostly live outside of city).
I never liked mayor Court - in fact he was the 2nd worse teacher I ever had - but wanted to give him a chance because I thought no unreasonable person would look a gift horse in the mouth - turns out this guy is just an idiot plain and simple.
Welcome to Saint John folks - your multimillion dollar project won't be based on it's merits, rather whether the mayor and city cronies and huxsters like you - does anyone remember Joey Smallwood of Newfoundland? Same thing.
Last taxpayer to leave Saint John please turn out the lights.
I never voted for him.