Show us the money, or at least how it’s to be paid, is city councillors’ message to the Downtown BIA board.
They have requested a staff memo regarding options to include a Meridian Place payment within the board’s 2021 budget, in consultation with BIA staff, before the May 25 city council meeting.
The BIA has a $1.5-million, 10-year commitment to Meridian Place — located right below Memorial Square in downtown Barrie — but didn’t pay anything last year, on council’s initiative, and has not included a payment in this year’s budget.
“If we need to delay the contribution this year, that’s entirely understandable, however the commitment must be honoured and the commitment to the full amount must be honoured, and it’s a ‘how’ not a ‘whether’ that happens,” Mayor Jeff Lehman said Monday.
“If the BIA board had come to the city and said ‘could you please forgive for ’21 what you forgave for ’20?’, and even if they said push the 10-year timeline by two years because of the impact of COVID, I would have supported that,” he added. “I believe everybody agrees that the commitment… to the amount of money is not in question, and that was the premise under which Barrie city council voted… to undertake the project.
“We did it because we were only having to contribute one-third of the cost and the other two-thirds was coming from fundraising and the benefitting property owners (BIA members)," the myor said.
The loan currently totals $1,512,946 and is to be repaid during a 10-year period, which was to start last year — until council waived the 2020 payment because of the impacts of COVID-19. The BIA has not included any repayment amount in its 2021 budget.
Councillors did give initial approval Monday night to levy $561,077 upon commercial and industrial properties in the Downtown Improvement Area and approve the BIA’s 2021 operating and capital budgets.
But that requires final approval at the Tuesday, May 25 virtual council meeting, scheduled to begin at 6:30 p.m., and a staff memo as well.
Several councillors have questioned why all of this has happened and what it means.
“Are we running the risk of running into a problem in coming years where instead of paying whatever the number is over 10 years, they’re now going to need to pay it over eight years, so that’s going to impact the (BIA) board and it’s certainly going to impact the (levy) rate,” said Coun. Clare Riepma.
“If the board is wanting to waive the payment for this year, again, I’m open to having that conversation, but I would like to see a formal request, if that’s the case,” said Coun. Keenan Aylwin.
“Is it not the understanding that when council tells (the BIA) to pay the money back that they’re going to pay the money back?” asked Coun. Mike McCann.
“They could sit and wait until the 10th year to make that one massive payment, which I highly suspect is not going to be the case,” Coun. Gary Harvey said. “I’m just concerned about how we are going to see our funds.”
City treasurer Craig Millar said the agreement between the city and BIA is that that payment for Meridian Place is required 10 years after its substantial completion. The agreement does not indicate annual payments.
“It doesn’t say in the agreement that the BIA is required to pay a minimum amount each year, it just says over a 10-year" period it has to be paid back, Millar said.
“So technically, by not paying it or not budgeting for it, they’re not in breach of contract,” said Coun. Robert Thomson.
Coun. Sergio Morales, council’s representative on the BIA board along with Coun. Jim Harris, said the board got a legal opinion about how to pay back the city, which said it is appropriate for the city to create a separate levy to pay that money.
“In essence, however, the accounting powers that be at city hall collect the money, the goal of the downtown BIA has is that they essentially… that money that they owe is taken off the top before they get their payment (from the levy),” he said.
“They (the BIA) got a legal opinion that basically they didn’t have to include it in their budget, but the city could levy it on their own, if the city so chooses,” Millar said. “They (the BIA) believe the city can levy on top of the BIA’s budget, a capital contribution, so instead of being $561,000… add $150,000.
“(But) it would be one levy and they (BIA members) would be charged more,” he added. “It doesn’t separate, it’s one levy.”
“I think what’s been unfortunate is the communication doesn’t seem to be too clear right now on exactly what’s being requested or what the board wishes to change,” Lehman said.
Millar said Ontario’s Municipal Act says that council can approve the BIA’s budget, but cannot increase it. Council can lower it and can approve it in part.
“These people are hard-working and we really are in their corner, but what’s the BIA really saying?” Riepma said. “Are they saying they want to push this off for another year or are they saying we’re quite OK to pay up, just (council) add it to our budget.”
