Lake Placid gets time
Pay up or lose riverfront land, city councillors tell developer
By David Hutton, The StarPhoenix
August 20, 2009 8:44 AM
After more than one hour of debate on whether the future of Lake Placid Developments' riverfront megaproject should be an election issue, city council on Wednesday granted the developer an extension to the last business day in October to pay the city $4.5 million for its south downtown property.
The extension was granted on the condition that roughly $215,000 in interest owed to the City of Saskatoon after missing a January payment deadline is paid by Aug. 31.
If either payment isn't made, the $250-million River Landing Village project will be dead. If the payment is made, the development permit requires that excavation of the land must be completed by June 30, 2010.
Lake Placid CEO Michael Lobsinger answered a bevy of questions from councillors at a special council meeting Wednesday.
"I sit in front of you embarrassed and humbled . . . but believe the funding is imminent," he told council.
"This is not the way it was planned."
Lobsinger, who said he has invested $6.5 million in the project to date and is spending $500,000 a month, said Wednesday he has a financial backer in Europe with "significant capital."
The money was "committed" in early May but not "funded," he said.
"When I receive the funds, you will receive the funds," he said. "If I haven't fulfilled the obligations, or my lender hasn't fulfilled the obligations, I lose."
All city councillors agreed an extension is warranted, saying they want the project to move forward. But a debate broke out on which date the payment deadline should be extended to: A deadline of Sept. 15, which would have some flexibility, or drop-dead deadlines of Sept. 30 or Oct. 30, the latter of which was recommended by the city's administration and lobbied for in a letter from Lobsinger that arrived late Monday.
Four councillors argued the Oct. 30 deadline, two days after the fall municipal election, would make the future of Lake Placid a campaign issue. Dealing with the issue before the writ is dropped would "show integrity," said Coun. Charlie Clark.
Councillors Tiffany Paulsen, Darren Hill and Pat Lorje also backed an earlier payment deadline to avoid politicizing the issue, they said.
"Whether we want to acknowledge it or not, Oct. 30 presents some very real difficulties and the citizens feel . . . that this is a game that's being played and the timing, 48 hours after an election, creates the illusion it's a game," Paulsen said. "If the money goes through, then the project goes ahead.
"But if it doesn't, the issue lands right back on to the next council's agenda, solidly, squarely and right in their face. . . . All the discussion will be focused on is this going to happen?"
Six councillors and the mayor argued the Oct. 30 deadline was merited because it was requested by Lobsinger and because council will no longer have to vote on the matter, with the payment for the land left with the company.
"This is not a political issue," said Coun. Glen Penner. "There are no more political decisions on this."
Mayor Don Atchison said similar extensions have been granted in the past and the date is no more than a concession to the company because of the exceptional circumstances it has faced, first with global financial markets collapsing, then with having to lobby the province for legislation to allow strata land titling, which several city projects required.
"This is absolute certainty now," Atchison said of the Oct. 30 deadline. "You heard me at the end there tell Mr. Lobsinger if he doesn't come up with the $214,197.14, the deal is finished, or if he doesn't come up with the money for the land, it's terminated as well.
"There's no more chances."
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