The city can develop a policy on public-private partnerships (P3s) but there are very few projects in St. Albert's foreseeable future that make such an option worth exploring, the standing committee on finance heard Monday night.
The committee, made up of the mayor and all councillors but chaired by Coun. Cathy Heron, voted unanimously to ask administration to develop a P3 policy and identify any projects in the city's 10-year capital plan that could benefit from such an arrangement.
"Ultimately, due to their complex nature, the time and resources required, a P3 should only be considered if it can provide better service and value for money," said Brian Brost, business manager for planning and engineering.
The committee decided last year to look at a P3 policy after it flirted briefly with the idea of pursuing such an arrangement to fund the construction of stage three of Ray Gibbon Drive. A private firm told the committee it could assemble a grant request for $4.2 million from P3 Canada for a cost of $45,000. The city eventually declined the option but voted to further explore P3s to develop a policy.
Brost said pursuing a P3 for construction of Ray Gibbon Drive, stage three, wouldn't have been a good use of such an arrangement.
"It did not make sense as this was a short, isolated section of roadway."
Thresholds
Communities that have P3 policies, such as Edmonton and Calgary, have project thresholds ranging from $20 million to $100 million that would trigger pursuit of a P3, Brost said. P3 arrangements involve a private partner becoming responsible for some combination of designing, building, maintaining, operating and financing a project the city eventually leases back from them over a specified period of time. Such arrangements typically put the risk of any large project on the private sector's shoulders as opposed to the municipality.
Such projects can attract grant funding from P3 Canada based on their order of magnitude, or they can be pursued privately between the city and a developer. The issue in smaller P3s becomes whether or not it truly benefits the city. Mayor Nolan Crouse asked about using such an arrangement to build a new ice sheet at Servus Credit Union Place. Guy Boston, general manager of planning and engineering, said the city could face some challenges from the developer as a result.
"We have to be concerned from the community perspective that it's not priced out of the market or undercuts our rates in terms of ice rental," Boston said. "They might think that the best time to have it open is only from 5 p.m. to 10 p.m. and then weekends. We might have a different view of that."
There are few projects at this point that would make a P3 worth pursuing. The south transit park and ride is one, but it would not qualify because of its location in the transportation utility corridor, its jurisdiction in Edmonton, and the unanswered question of who would operate it.
Other future projects that could merit consideration would be a north transit centre park and ride, a new civic building and the community support centre.
Crouse said it was worthwhile having a policy in place for the future.
"If something comes along, you don't want to be sitting around, saying we don't have a policy."
