$11M more for hospital land
Before shovels are in the ground, city putting out funds for expanded footprint
The City of Niagara Falls has agreed to pay $11 million for an extra 20 acres of land — in addition to the 30 acres it was given — for a south Niagara hospital.
The issue was dealt with behind closed doors prior to Tuesday’s council meeting, and ratified in open council later that night.
A larger footprint for a hospital at the corner of Montrose and Biggar roads on the outskirts of Niagara Falls was billed as a necessity for future expansion and replacement.
Niagara Health said in its submission for phase two of the planning process to the Ministry of Health and Long-Term Care that it has to demonstrate the proposed site has capacity for both expansion and replacement in future years.
The 20 acres will be purchased from a business family that in 2013 agreed to donate 30 acres for the project.
As part of the agreement of purchase and sale, the city will provide a tax receipt in the order of about $14 million for the 30 acres of donated land.
“From a practical standpoint, I don’t know how we’re going to beat this,” said city solicitor Ken Beaman, adding if the land was ever the subject of a hearing, it’s highest and best use would likely be as residential land.
“You can’t get residential land for less than around $220,000 an acre, so I’ll spend half a million dollars on legal fees for you and I’ll end up at the same place. Big weapon we have is the expropriation — go grab it. The problem is, if highest and best use is as residential land ... we’re going to pay the same amount.”
Chief administrative officer Ken Todd said once the deal is finalized, the city will end up owning 50 acres of land that will then be turned over to Niagara Health for the construction of the hospital.
“Unfortunately, the price is not a price we all like, but it’s a price we’re going to have to pay to ensure this hospital gets built on the site that it’s proposed for,” he said.
Todd said the process started around 2013 when Niagara Health identified the hospital was going to be around the same size of the new St. Catharines hospital — 700,000-square-feet.
“They identified at that time that we needed 30 acres, that this hospital could fit on 30 acres of land.”
He said Mayor Jim Diodati contacted the Grassl family, who are businesspeople from Toronto but own land in Niagara Falls, who agreed to donate 30 acres for the hospital.
Todd said two years later, the hospital planning group met with city staff and told them the hospital is now proposed to be approximately 1.2-million-square-feet — and will not fit on 30 acres.
“If we had known right from day one, the mayor would have asked for a 50-acre donation, not a 30-acre donation, but that’s what we asked for because that’s what we were told we needed at the time,” he said.
Todd said the province has what’s called a legacy plan, which “will ensure that this hospital remains in the city of Niagara Falls forever.”
“A legacy plan identifies the need to be able to replicate a new hospital on the same site 40 or 50 or 60 years from now while the existing hospital operates, and then when the new hospital opens, the old hospital on the same site is demolished, that becomes your parking area, so it’s all contained on one site.
“We can ensure, through this investment tonight … that this hospital, once constructed, will remain in the city of Niagara Falls in perpetuity because that’s the way the plan is set up.”
Coun. Vince Kerrio said council had a “very lively debate” behind closed doors about the pros and cons of the deal. “Not that I like the price, but at this stage of the game I want to be a team player,” he said.
“I’d like to be getting the 50 acres for nothing, but I think that the staff has done the best job that they could to get us to where we are today, and now it’s time to come together and support this as much as we can.”
Coun. Kim Craitor said the $11 million is in addition to the $20 million council committed in 2013 from its casino-hosting fund towards the building of the hospital.
“The province of Ontario has forced us to have to buy 20 (more acres),” he said.
“This government has forced us to go back to the taxpayers of Niagara Falls and say $20 million is not enough, you have to give us another $11 million. I’m going to support it, but at least the public has heard clearly why we’re in the position we’re in.”
Diodati said it’s not cheap, but “in the end it’s going to be a $1-billion investment by the province. This is going to be huge.”
Coun. Carolynn Ioannoni was the only councillor to vote against the land purchase, but she stressed she’s not “anti-hospital.”
Coun. Victor Pietrangelo declared a conflict and did not vote.
Ioannoni said she was not provided with certain information and “I want to be able to vote informed.”
“If we can’t vote with the proper information in front of us, it’s really hard to make an informed decision.”
She said she has concerns with certain aspects of the deal.
“I just think paying highest and best use on somebody else’s appraisal, as opposed to, you’ve seen our appraisal that came in much lower than that, is wrong. I think this deal needs to be structured that we do not spend $11 million if this hospital isn’t guaranteed. I think that protects the residents, I think that protects the council and I think it answers all the questions. I think that condition should be in the offer to purchase.”
Coun. Joyce Morocco said there’s “no doubt” the hospital will be built. The province approved a $26.2-million planning grant for the hospital and recently listed it in its provincial budget as one of the hospital projects that will benefit from $9 billion during the next 10 years for construction. “This is a huge opportunity to have a state-of-the-art hospital larger than the St. Catharines facility with centres of excellence here for our residents,” she said.
“And if it doesn’t (happen) for some reason, we have 50 acres. That land we’ll be able to sell at probably even more than that because of the way the development is going (in that area).”