LaSalle marina expansion project under review
City would be responsible if nonprofit organization couldn’t pay back $4.6M loan for permanent wave break
BURLINGTON — City officials have poked holes in a nonprofit organization’s plan to finance a multimillion-dollar marina expansion at LaSalle Park that tax dollars would have to shore up if it tanks.
The city would be on the hook if the LaSalle Park Marina Association can’t pay back a $4.6-million loan over at least 25 years to help cover the estimated $14-million project, a finance report says.
“This would also be unprecedented and have inherent risks,” city manager James Ridge added in an email Monday, noting taxpayers would “very likely” be dinged for cost overruns, as well.
The installation of a permanent wave break to replace a floating one and increasing the number of boat slips to 349 from 219 also hinges on support from senior levels of government.
LaSalle Park Marina, a joint venture with the city, will draw more traffic once it expands and a permanent wave break is built, association president John Birch said.
“It will bring to Burlington, as we’ve said at the outset, a full and safe harbour.”
Coun. Rick Craven says some boaters aren’t using the marina because its choppy waters make it difficult to get insurance for their vessels.
“The marina as it stands right now is facing serious problems because the wave break doesn’t protect the boats.”
But a recent city finance report casts doubt on whether the marina association’s plan to finance the project is sound.
The report notes occupancy has been declining in recent years.
It also quibbles with the association’s projected slip rental, questioning the expected business from larger boats, which are charged more to dock.
Birch argues the staff report is inaccurate, saying some projected costs are overblown.
“This is based on a poor understanding of operating marinas and what their actual expenses are.”
The association also set a conservative occupancy rate of 80 per cent, he said, but expects that to be closer to capacity when boaters are drawn to the new marina.
Birch said he asked Ridge to withdraw the report — which was to be discussed Monday at City Hall — to allow for meetings with staff.
Ridge acknowledged the association is concerned but suggested he pulled the report so council could later discuss the marina in a broader context.
The observations are also “arguably at odds” with a recent council decision to write a letter in support of the association’s pursuit of government grants.
“This is further reason for council to pause and consider the project from a more holistic perspective.”
Coun. Marianne Meed Ward said the marina association doesn’t qualify for Ontario infrastructure funding, which means the city could be exposed to “significant risks” if it applied on its behalf.
Meed Ward added she has “absolute confidence” in staff ’s take on the project’s financial model.
Council must decide whether the project should be a priority given other significant city pressures, such as a deep infrastructure backlog, she said.
Meed Ward hopes to have that discussion in September when she expects staff to present the marina report alongside an assessment of joint-venture agreements and debtrepayment policies.
The marina project is also a sore point for the Trumpeter Swan Coalition, which argues the changes will destroy a quiet, natural habitat for waterflow and harm fish.
Coalition spokesperson Liz Benneian says she has “full confidence” in finance staff ’s review. “These are professional people who are asked to do a job based on numbers, not on politics.”