Kelowna City Councillor
Ron Cannan
Kelowna City Councillor
Ron Cannan

Letter: Bridge Financing

by - Story: 144

To the editor:

Just writing to clarify some comments in your recent Okanagan Lake Bridge financing poll.

Because the Government has such a good credit rating ("AAA"), Kelowna City Council has asked the Province to consider the option of borrowing the funds at about 5.37%, while a Private sector "A+" rated company would have to borrow at about 5.91% (this 5.91% is based upon the group that built the toll Highway 407 in Toronto). In dollar terms, for a $120 million project, the private sector would pay an extra $648,000 each year in interest or an extra $16,200,000 in interest over a 25 year period. Not an insubstantial amount!

The remainder of the bridge project could still be built and maintained by the private sector thus capitalizing on their innovation, flexibility and efficiencies. This is how the City is developing the Mission Recreation Complex. City borrowed the money and RG Properties is building and operating the complex. A Win-Win Partnership maximizing the strengths of the partners molding them together to cost-effectively manage risk!

This affordable financing proposal was first introduced to the Province by City Councillor Robert Hobson (Chair of the Regional District and Municipal Finance Authority Director). During the Coquihalla debate Premier Campbell listened and responded to the people. Hopefully, he will re-consider the financing strategy to build the replacement bridge and save of us all millions of dollars!

Thanks for your time!
Ron Cannan
City Councillor

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