The proposed Crystal Pool and Wellness Centre is facing budgeting issues that have City staff planning for a very expensive setback.
Planners of the $69-million project have been heavily relying on a combined federal-provincial Investing in Canada social infrastructure grant that would cover up to 72 per cent of the budget. It was originally scheduled to be awarded by the end of 2018, allowing construction to begin in 2019.
However, grant representatives recently indicated that funding decisions wouldn’t be made until the first half of 2019. This would affect whether the City can claim $6 million from the Gas Tax Fund, which was awarded in February with the caveat that all other project funds would by secured by next March 31.
By the end of last month the City had only secured 23 per cent of the necessary funding.
“It’s fairly critical that we get some clarity on the Investing in Canada launch as soon as we can, and the potential funding and the timeline,” said Thomas Soulliere, City director of parks, recreation and facilities. “We’re flagging it to council now because it’s something we are looking at down the road, looking at potential risks and decision points.”
Delays to the project also introduce the risk of cost escalation for construction. City staff and private surveyors have identified February 2019 as the latest date all project funding commitments must be in to avoid any negative impacts. Current projections see costs increasing by $300,000 to $500,000 per month after that.
“It’s a pretty substantial potential increase,” Soulliere said. “This is the market we’re in right now; it’s quite heated and quite competitive because there’s so much construction going on.”
The City is also waiting on news of a $1-million grant from the Canadian Tire Jump Start Charities, which is due to be announced shortly; and a federal Enabling Accessibility Fund grant of as much as $1 million, which will be announced in early 2019.
Should these funding sources fall through, Soulliere said there are other ways to fund the project.
“We’ve got a wide range of options, related to using internal City funding, capital reserves, tax-based funding. And the City has the the option to borrow money,” he said, adding that at this point no specific recommendations are being put forward. “Those will come in a fall report once we have gathered more information.”
Victoria Mayor Lisa Helps said she’s not worried about the deadlines and has faith that things will work out.
“I’m not feeling concerned, because we got a very positive response from [B.C. Finance Minister] Carole James and [Federal Infrastructure and Communities Minister] Amarjeet Soji regarding the $6 million Gas Tax grant,” she said. “They need to spend the money and my guess is the province will make a call for proposals as early as mid-September.”
While the timeline is getting tight, Soulliere said at this point they’re just trying to plan ahead.
“We’re trying to be very proactive and make sure the council and public is aware of how things are looking,” he said. “The project is on schedule, we just need the timeline for getting funding by the end of the year, which we’re working on.”