A new research report from the union representing outside workers with the Halifax Regional Municipality shows that P3 arenas and rec. centres are fraught with financial risks for taxpayers.
CUPE Local 108 President David Carr says, “This report should raise the red flag for HRM Council. It provides details of several municipal arenas and recreational facilities that have failed, leaving local taxpayers holding the bag, sometimes to the tune of millions of dollars.”
Among the report’s findings:
- The City of Edmonton just last month decided against a P3 rec. centre when they learned it would cost them $2 million per month in construction delays, because the contract gave them no protection against rising costs.
- The City of Moncton had to pay 50% more than actual cost for the Moncton Fourplex - $1.4 million per year over 20 years for a $15-million facility.
- Taxpayers in the City of Ottawa were left with a $12 million debt as part of a termination of a P3 partnership with Serco, operators of the Ray Friel Centre.
- Taxpayers in the City of Cranbrook, B.C. faced a 7% tax increase, five years after a 4,250-seat arena project first began, having struggled through legal disputes, cost overruns and construction delays.
CUPE Nova Scotia President Danny Cavanagh says, “In a P3 arrangement there are no guarantees. Contrary to what proponents will tell you, the parent company of the private partner may change throughout the life of the agreement.
“In one P3, the City of Hamilton, Ontario’s sewage treatment plants, ownership changed six times during a 10-year contract. At one point, these plants were being run by a subsidiary of Enron, if you can believe that,” says Cavanagh.