City of Powell River will be purchasing the lands owned by the Powell River Waterfront Development Corporation (PRWDC) for $1,380,000.
At the council meeting on Thursday, June 20, council voted unanimously to authorize the purchase of the lands held by PRWDC. Council must authorize all purchases greater than $500,000.
Council has included the purchase of the PRWDC land in the 2019 – 2023 five-year financial plan for up to $1.4 million. Total available funding would involve short-term borrowing of $1.2 million, $68,961 from the land sale reserve and $173,794 from the parkland reserve, for a total available funding of $1,442,755.
On August 31, 2018, PRWDC gained ownership of 182 acres of property, appraised at $2.16 million, which the city will now take over. PRWDC purchased the lands with a loan guarantee from City of Powell River. The expected loan balance held by PRWDC is $1,380,716.
According to chief financial officer Adam Langenmaier, the loan estimation for the PRWDC land would carry annual interest payments of $30,000, and annual principal payments of $226,025, for an annual cost of $256,025 over the five years of the loan. Estimated cost of borrowing from the Municipal Finance Authority is 2.5 per cent.
For borrowing of five years or less, the city does not need to go to an elector approval process, such as a referendum, for approval. Paying off the PRWDC loan will give the city ownership of the 182 acres of land.