Tuesday, October 27, 2009

Get ready to chip $106 for the new B.C. Place roof

Can B.C. taxpayers really can afford $458 million for a fancy new roof on B.C. Place?
Especially right now. The government has chopped funding to fix leaky schools. Health authorities are cancelling thousands of surgeries to save money. School parents' groups, people who work with seniors, mental health programs - the government says there is no money to keep on supporting them. Youth sport funding has been chopped.
But for a Vancouver stadium and its two main pro sports teams, the government can find almost $500 million from taxpayers.
Which works out to about $106 per British Columbian - say $425 for a family of four. If they live in Prince George or Nelson, it's a big bill for a stadium they will likely only see on TV.
The government justifies the project on two grounds. Tourism Minister Kevin Krueger said the project will create 3,000 per years of employment. But that's a cost of more than $150,000 for each one-year job. The government could create the same employment at much lower cost simply by reversing cuts that have meant layoffs across the province.
And Krueger says a retractable roof will result in greater use of B.C. Place and indirect economic benefits for Vancouver.
You own the stadium. It's operated by a Crown corporation, Pavco, which also runs the Vancouver Convention Centre. Pavco's last annual report said the stadium was booked for about 200 events last year. The average economic impact was about $300,000 per event, Pavco estimates.
With the roof, the Crown corporation hopes that by 2013 there will be an extra 41 bookings a year, more than one-third of them from the Vancouver Whitecaps soccer team. And it expects each of those to generate an extra $1 million in spinoff benefits.
The corporation, and thus the government, is counting on attracting bigger summer events once the roof can open. (It's too often hot and uncomfortable now, apparently.)
There's certainly a chance for greater economic benefits if the right events can be added to the schedule. U2 played in GM Place this week; of the 56,000 tickets, 16,000 were sold to people from outside the province. That's a lot of hotel rooms that will be booked and restaurant meals.
But it's also true that there is no guarantee that will happen.
And people outside Vancouver - or even outside the business sectors that will benefit - have a right to wonder why they are footing the bill for a reno that benefits a couple of sports teams and a specific group of businesses.
You are paying. The government has been a little cute in announcing the project, describing its commitment as a loan to Pavco.
That's not really accurate. The Crown corporation is going to use $42 million left over from the Vancouver conference centre project. (Which, you'll recall, ended up costing $841 million, although Premier Gordon Campbell had insisted the $495-million budget was adequate. Provincial taxpayers picked up the whole bill for the overruns.)
And it hopes to raise the rest of the money by leasing land taxpayers own around the stadium site for development. If that works, it can repay the loan.
But that's still a cost to taxpayers. The people of B.C. own that land. It could be developed and the money used for health care or tax reductions or to reverse cuts in services in smaller communities.
There are other ways of funding the roof, if it is a good investment. In other places, special taxes or fees have helped ensure that the people and businesses who benefit from the stadium improvements pay the costs. There could be a tax on Lower Mainland hotel rooms earmarked for the new roof, or a surcharge on event tickets or a levy on Vancouver businesses. If the benefits are as claimed, that would be fair - certainly fairer than asking someone in Penticton to pay for Vancouver's fancy new stadium roof.
Footnote: Don't expect much political debate on this. The NDP supports the new roof, although MLA Spencer Herbert notes the cost estimate has more than doubled in the last 12 months. Politicians do seem to love fancy stadiums for sports teams.


Gazetteer said...

Actually Paul, according to PavCo's David Podmore, it would appear that a big-chunk of this will be financed by some kind of longterm 'land-lease' give away of publically-owned False Creek North Real Estate that is netting us $106 for every woman, man and child in British Columbia now that would be worth, what I wonder in, say, 10 years?


Leah said...

3,000 person years of employment hmmm?

Would Mr. Krueger be so kind as to tell us just how many of those 3,000 persons come from, or permanently reside in BC?

DPL said...

Lets not forget that here in Victoria, we are about to get stuck with much more for a sewer system ordered by Penner, and of course the bridge that our fabulous Liberal gang have decided they arn't about to spend any money to assist in the costs of building. Millions of dollars just seem to flow off the Gordo gangs ideas. Money of course they won't be paying. Wonder how big the defecit is actually? Will we ever find out? Not if Gordo can spin it.