Mill River math
Opposition MLA Steven Myers questions why government gave away a golf course
If Mill River made money last year, why did the province sell it for a firesale price? That’s the question Opposition MLA Steven Myers posed to government today in question period.
The sale of the Mill River golf course, resort and other property assets has been the subject of scrutiny in the legislature all week, with Opposition MLAs delving into details of the financing offered to the new private owner, Don McDougall.
On Friday during question period, Myers said he has done the math with figures provided by government, and according to his calculations, the Mill River golf course should have made money for McDougall last year. McDougall entered a oneyear agreement with the province to lease the Mill River golf course, fun park and campground last year. He received $400,000 from the province as part of this agreement, but also refunded government approximately $500,000 in employee salaries.
During budget estimates this week, it was ascertained the Mill River golf course sold over 15,000 rounds of golf last year. It was also confirmed that McDougall kept all revenues as the operator.
At $65 per green fee, Myers says the golf course should have made over $900,000. Factoring in the operating grant from the province and even calculating the reimbursed wages, Myers says McDougall would have made money last year.
He questioned why government then sold the whole property, including the resort, to McDougall for just $500,000 while also granting McDougall $6 million for capital improvements and $1.6 million to cover losses over the next six years.
He pointed out McDougall will also be paying out less in wages, as he has indicated he will not be pay union wages.
“All along you’ve tried to justify this sweetheart deal to Islanders,” Myers said. “How can you justify these firesale prices to Islanders when the operator cleared enough to buy the resort last summer and pocket $400,000 to boot?” Economic Development Minister Heath MacDonald it’s his understanding the golf course lost more than $150,000 last year.
He did not accept Myers’ calculations.
“It’s easy to stand up and say whatever comes to mind, to throw out figures with no relevant concrete information to back them up,” he said.
He defended the deal with McDougall as a way to revitalize western P.E.I. and to keep jobs in this rural area of the province. “We’re already seeing economic spinoff relevant to Mill River, and sooner or later, there will be a flag on this property, and every time we see a flag on Prince Edward Island it gives us an opportunity to capture even additional markets.”
But it seems taxpayers will still pay McDougall $1.6 million over the next six years to cover operational losses, even if the new owner is able to make it profitable. MacDonald confirmed Thursday evening this money is a grant and will be paid out regardless of whether the balance sheet is in the red or in the black.