St. Albert city council is confident the UCP government will honour the cost-sharing agreement to twin Ray Gibbon Drive and has taken the next step toward borrowing $36.6 million to cover the city's share.
Council passed first reading of the borrowing bylaw on Monday, which is the first step the city has to take before being able to actually borrow the money. The bylaw still needs to go through second and third readings before being finalized, which is scheduled to happen Aug. 19.
The original cost-sharing agreement, a $27.1-million commitment, was made with the former NDP government.
Mayor Cathy Heron said she has received assurances from St. Albert’s UCP MLA Dale Nally that the project will be moving forward.
“We have a legal contract on this," Heron said. "Our MLA in that area, Marie Renaud, has already sent a request. Once we get the reply, I will be obviously sharing that with everyone.”
Coun. Jacquie Hansen said it would be nice to have more assurances from the new government.
“It really would be nice for us to have in writing something from our government ... more than assurances verbally from our UCP MLA," she said. "I don't know how difficult that is to do. I know it's getting followed up with now but it would be nice to be able to know that it is happening because of a changing government."
Minister of Transportation Ric McIver, in an email to the Gazette, called Ray Gibbon an important link and acknowledged it was one of the top five priorities of the Capital Region Board.
“We are reviewing our capital plan projects to make sure that (the) highest priority projects are approved and tendered without delay,” he said in his email. “This project will be considered alongside other capital projects across the province in preparation for a budget this fall.”
David Leflar, director of the city’s legal and legislative services, told council that a letter from the government would only reaffirm that a legal contract has already been reached between the city and the province.
"We do have a binding contract with the government," he said. "It's almost like saying, 'Please assure us you're not going to break your contract.' I guess they can always break the contract but governments are not in the business of doing that."
Once approved, the loan will be over a 20-year period at an interest rate of 2.82 per cent. The city is expecting to pay $2.4 million annually, which includes interest and principle. The total interest over 20 years is expected to be $11.5 million.
The city is intending to withdraw three or four times over three or four years. While the city’s share is $27 million, the borrowing bylaw includes a 35 per cent contingency.
More than 20,000 vehicles use Ray Gibbon every day. The project will happen in phases, with the first phase seeing the road twinned from the southern city limit to about 300 metres north of LeClair Way. Construction of that leg should get underway in 2020.
The total cost for the project is $54.2 million over 10 years, with the city bearing the costs of the first five to six years before the province chips in.
The city has taken on debt before including $26-million for improvements along St. Albert Trail, $9.8 million for the North Interceptor Trunkline, also known as Project 9, and $16.3 million for Servus Place. The city has a self-imposed limit of $150 million and a provincial limit of about $300 million.
