UPDATED Fact Check for Councillors: Lansdowne 2.0 is the most expensive project you are being asked to vote on in this term of Council. 

Lansdowne 2.0: Half a billion dollars of City spending

At the end of the day, Lansdowne 2.0 is likely to cost the City at least $500M. The $419.1M for the main project plus the $18.6M for parking stalls are only Class C estimates. Expect the combined $437.7M cost estimate to balloon, like the LRT and library – it is almost guaranteed.

Lansdowne 2.0 is far from “affordable”

You’ve been told that Lansdowne 2.0 debt repayment would only cost the taxpayer $5M/year! Sound too good to be true? It is. The City is setting up a debt servicing budget of $16.4M/year because the debt needs to be repaid no matter what. Taxpayer obligations, including parking stall debt, will be $17.4M/year over 40 years, –$696 million. Lansdowne 2.0 debt comes on top of Lansdowne 1.0 debt of $100M, $70.7M in guarantees, and a $120M retail loan. 

Air Rights Don’t Pay for the Project 

What about the air rights? Won’t “the towers pay for much of the project”? No, they won’t, not even close.  The much-touted sale of “air rights” can cover only a miniscule fraction of project costs – 9%. This leaves 91% of this project’s staggering costs for the City to fund.

Property Tax Uplift is Effectively Tax Diversion 

Property Tax Uplift is not a real financing mechanism; City staff could not reference any other municipality in Canada that uses it. This opaque term masks a plan to use 75% of Lansdowne’s property taxes to help fund Lansdowne 2.0. Other taxpayers will cover the costs of city services, effectively subsidizing Lansdowne.  

Insufficient Financial Transparency and Due Diligence

EY has performed some level of financial due diligence on the OSEG proposal. But their limited mandate did not explain how OSEG justifies the rosy projections for its 4 business lines (REDBLACKS, 67’s, Stadium and Retail) given the dismal financial performance to date. Why are we doubling down on a failed financial model before the Auditor General’s report?

Fear-Mongering re: “Doing Nothing”

There is no doubt that the sports facilities at Lansdowne will need to be replaced eventually.  But they are safe. To characterise them as “crumbling” is to ignore that the City made significant investments just 10 years ago.  It is also to ignore the fact that OSEG already has secured the World Juniors to be played in the arena in 2024. OSEG has the legal obligation to maintain these facilities. But should OSEG walk away, the City’s claim that it would cost taxpayers $400M is highly questionable.  It assumes the City makes no changes over the next 40 years. This would be a serious failure of imagination of our City leaders. There is little doubt that other partners would be interested in a prime site like Lansdowne. “Doing nothing” at Lansdowne would allow the City to “do something” better for the taxpayer.

City Priorities 

When the City doesn’t have funds for transit, affordable housing or paramedics, is an immediate revamp of Lansdowne a spending priority? To put it in perspective, project spending represents roughly $20 million across each City Ward. Does Ottawa not have greater spending priorities? And isn’t it just common sense to decide on a new 67s arena/event centre at Lansdowne after the Sens make a decision regarding a downtown arena? Can Ottawa really support two sports and entertainment centres in the core? Why are we ignoring the risks?

Ten reasons NOT to support Lansdowne 2.0:

  1. It’s a huge cost for taxpayers: about $500M of City spending, and $331.3M of new city debt
  2. It is not affordable: property taxes will be diverted, and there is only $1.2M in reliable funding sources for the annual $17.4M in debt servicing
  3. It’s not a priority: what are the City’s real priorities for ½ a billion dollars of taxpayer money?
  4. The Auditor General is starting an audit of Lansdowne, why rush the decision before results?
  5. There’s been a glaring lack of transparency and oversight—much like the LRT problems
  6. The financial model is risky: a huge amount of City debt repayment depends on a dramatic turnaround of Lansdowne financial performance
  7. The planning was rushed, flawed, and doesn’t look at real options 
  8. There are no transportation solutions to a very big transportation problem 
  9. It is bad for the environment: reduces green space, not carbon neutral, disturbs toxic soil 
  10. We don’t know what’s happening with the Lebreton arena, another big arena project in Ottawa 
  11. It’s a luxury at a time when Ottawa has real needs. The sports facilities are structurally sound. 

What’s the alternative?  Preserve and repair the perfectly adequate facilities for now; take the time needed to get it right.

Prepared by the Glebe and Old Ottawa East Community Associations.

October 20, 2023