[SteelTown]

After three-year roller-coaster ride, deal for Lister Block 'is dead'

June 26, 2008
Nicole Macintyre
The Hamilton Spectator

The city's Lister Block deal has flatlined again.

Council refused last night to budge from its position on the $25 million deal, despite a last-minute offer from the owner.

In a 9-6 vote, council reaffirmed that it wants a $1 million guarantee that a second phase will earn at least $600,000 in taxes a year. LIUNA vice-president Joe Mancinelli said the union isn't willing to move its position either.

"The deal is dead," he said late last night.

After three years of twists and turns, the Lister deal died over roughly $50,000.

The city and LIUNA had tried to negotiate a new proposal in the hours before the meeting. LIUNA agreed to give the city a $1 million guarantee that there will be a second phase, but wanted lighter conditions than council requested. Councillors wanted the additional development to offset the extra cost of buying the Lister. It would cost taxpayers an extra $1.3 million a year beyond existing leases.

The developers proposed they would get their guarantee back if they built a commercial building or seniors home of at least 65,000 square feet or 130,000 square feet of residential. Either development would generate $550,000 a year in taxes for the city - just $50,000 less than originally pegged by council.

But LIUNA also wanted a sliding scale if they built a smaller development. The union would only lose the entire $1 million if they built less than 40,000 square feet. If they were between 40,000 and 65,000, they would only give back a part of the guarantee.

Staff endorsed the compromise, noting it came close to the city's original expectations.

But several councillors said they weren't willing to compromise and risk taxpayers being on the hook.

"I think we should stay the course," said Councillor Brian McHattie.

Downtown councillor Bob Bratina said he wouldn't support the deal even with the guarantee. The city should be helping a private Lister development with its existing incentive programs, not buying the building, he said.

Mayor Fred Eisenberger urged council not to kill the deal over $50,000. "I really do fear we may be throwing this away."

Councillor Tom Jackson noted the three-year Lister saga has given him more stomach problems than a rollercoaster.