Kananaskis commitment under review
Province rethinks decision to chip in for $ 18- million golf course rebuild
The Tory government is rethinking its controversial decision earlier this year to spend $ 18 million to rebuild a golf course in Kananaskis Country that was heavily damaged in the 2013 floods.
Environment Minister Kyle Fawcett said Thursday the numbers he’s seen show the cost to taxpayers of repairing the 36- hole facility is about the same as returning the flood- prone area to its natural state and paying off the company that has had a deal to run the course since it was completed over three decades ago.
“There are financial obligations to the province under the operating agreement as well as some liabilities around reclamation of the land that the province would have had to undertake if it had decided not to proceed,” Fawcett said in an interview.
“It was comparable ( to the cost of rebuilding).”
When the decision to rebuild the course was announced in July, former parks minister Richard Starke cited a three- year- old study that estimated the course generated about $ 14 million annually in direct and indirect benefits to Alberta’s economy.
But Fawcett said Premier Jim Prentice asked this week for the decision to be reviewed after opposition parties questioned the expenditure by government that has repeatedly warned Albertans it may slash spending to key areas in the forthcoming budget due to plummeting oil revenues.
‘ The premier is certainly very interested in this,” he said. “There’s certainly some questions he’s asked us, some tough questions.”
The government’s move also comes in the wake of a Herald story this past summer that revealed the private company that holds the operating lease for the course had close connections to the Progressive Conservatives and was not the highest bidder when it was first awarded the contract in 1983.
Provincial officials say the 10year extension of the lease it negotiated with Kan- Alta Management Ltd. prior to the rebuilding announcement is confidential.
Starke has said the agreement gives taxpayers a fair return on their investment, even though there was no competitive process.
But industry experts and other course operators who the Herald asked to review the original 1983 deal say the terms of that lease — included a sliding fee and a maximum five per cent levy on revenues — were significantly lower than market rates.
Supplementary estimates approved this week by the legislature contained $ 1.2 million in capital spending for the golf course and another $ 8 million in operational money to maintain the infrastructure and grounds while the facility is rehabilitated.
Fawcett said he was unsure if the operational money included compensation to Kan- Alta for lost revenues while the course is repaired.
“There are some buildings that weren’t damaged that needed to be heated,” he said in explaining the $ 8- million figure.
“I’m not sure what the contractual obligations are to the leaseholder.”
Department officials did not respond to a Herald request Thursday for a breakdown of how this additional taxpayer money for the course will be spent.