Wednesday, 13 July 2016 13:47

Elmwood deal seems like a strange one

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It just doesn’t get any stranger than this. 
The City, last Monday, voted unanimously to give the Elmwood Golf Course another $500,000. This is in addition to the $2.4 million they received last year. When is this ever going to stop?
Council will need to borrow money in order to give it to the golf course. If this was your personal money and your credit limit was already maxed out, do you suppose you would lend it to someone with no personal guarantees and agree to not have it paid back for 45 years, and in addition, have most of it forgiven through lot sales? 
The City also recently approved another $400,000 for a waterfall and a retaining wall at Cypress Point.
The City claims this is all worked into the price of the lots. That is a strange claim as these two items were not even on the drawing board when the lots were priced out a year ago. I can guess who will pay for these items.
The golf course is short on funds, as the lots on Cypress Point have not been selling, therefore they have not received the $20,000/lot proceeds they convinced the City to give them.
Mr. Hope says they need more money to help cover borrowing costs. This is like using one credit card to pay off another. It seems they are afraid the next council may not be quite as generous when they come back, cap in hand for the next request, so they are coming now.
So far only two individuals have bought lots in this sub-division. The Mayor suggests this concept is no different than any other development in the City. I would beg to differ.
When was the last time Council made as big a deal at a council meeting about selling a few lots in any new development as they did with the first sale to two individuals. Can he tell me what other organization or individual has ever received $20,000 on the sale of each lot the City has sold.
The property was already owned by the City, so what right does the golf course, a member owned course, have to benefit from those sales.
Never have any city-owned recreational projects been directly financed through lot sales so why would Elmwood Golf Course receive this preferential treatment when the golf course is not even owned by the City.
There seems to be a sense of entitlement on behalf of Elmwood. I have not heard of any levy assessed to golf course members themselves to help pay for the improvements.
The Mayor explains this is a win-win situation for the golf course and the City. I fail to see the win for the City. If the City were to develop the lots cheaper than expected and generate a profit, the agreement between the two parties states the golf course gets all of the profits as well as the $20,000 per lot.
Further, what would happen if the city had to reduce the price on the lots in order to sell them?
In that case the golf course would still receive their $20,000 and the City would suffer the entire loss.
This is a very real possibility as the City has already moved to remove some of the restrictions on these lots in order to make them more appealing.
Councillor Budd said the City would make money by charging the golf course interest on the outstanding amount. He should read the agreement. The golf course pays exactly the same interest rate the city pays to borrow.
I hope those council members who are running for re-election are prepared to answer for their actions this fall.
Do the citizens of our great city deserve to continue to have double digit tax increases to support these types of questionable lending practices?
Don Robinson, Swift Current

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