Councillors divided over loan program
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Nov 29, 2012  |  Vote 0    0

Councillors divided over loan program

Ancaster News

By Kevin Werner, News Staff

Suburban and urban Hamilton councillors found themselves divided over what some politicians said was a politically-driven process to fast-track money for about six development projects in the downtown.

For the second time in two days councillors were mired in a heated debate whether to pre-approve $400,000 in interest costs for the loan program for downtown multi-residential buildings. The program offers zero per cent interest loans for 25 per cent of the construction costs.

Robert Rossini, corporate finance general manager, said it has created an additional $1.6 million in annual tax revenues for the city. But with developers taking advantage of the program, there are about six projects waiting to tap into the loans, and not enough money in reserves to cover the costs, said staff.

“This has been a very successful program,” said Rossini.

Neil Everson, economic development and real estate for the city, said one potential application worth $4.5 million could be filed within a week. He also said four other applications could be submitted in January and February.

Two of the projects are the Royal Connaught redevelopment and the Vrancor condominium project at the corner of Bay and King streets. The Vrancor project already received $9 million from the city in a loan this past summer. Another project expected to apply for the program is Options for Homes at the corner of Queen and King streets.

Councillors had originally agreed to send the $400,000 cost to the 2013 budget talks, expected to begin in February.

But downtown politicians said that could be too late since the councillors approve the budget in March or April. They said the money can be pre-approved now allowing the developers to begin the building process early next year.

“This is one of the most successful programs,” said Ward 5 councillor Chad Collins, who backed the program in the 9-7 vote.  “We need to find creative ways to open investment up.”

Ward 1 councillor Brian McHattie, who introduced the motion at the Nov. 28 council, said potential projects are waiting for the money.

Added Ward 2 councillor Jason Farr, “it just makes sense to proceed further.”

ButStoney Creekcouncillor Brad Clark said he has received conflicting information from staff during the council debate, prompting him to accuse city staff of providing politically motive information to get the program approved.

“I feel I was spun by staff,” said Clark, who was leaning toward supporting McHattie’s motion. “It’s incredibly disheartening to have staff politicize (information). Spinning never helps. I want to make decisions based upon fact.”

Ancaster councillor Lloyd Ferguson felt he was being forced to support the program.

“I’m getting annoyed at being goaded,” he said. “We have a lot of pressures in the budget.”

With Mayor Bob Bratina seeking a zero per cent budget increase, and the Hamilton Police Services proposing a 5.2 per cent increase to its budget, councillors will find it difficult to meet that zero per cent target, he said. Bratina supported McHattie’s motion.

“I’m not going to be goaded. It will take three to four months to go through the application process,” saidFerguson.

Even with a $200,000 compromise for the program, proposed byDundas councillor Russ Powers, suburban councillors remained adamant they wouldn’t support the motion.

“I stand by the process,” said Stoney Creek councillor Maria Pearson. “This is not fair to taxpayers.”

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