Financial details revealed for railway corridor purchase

Of the $22 million price tag for the CN line from Kelowna to Coldstream, RDNO would pay $1.9 million.

There are more details about what it will cost taxpayers to purchase a railway corridor.

Information released Tuesday shows that of the $22 million price tag for the CN line from Kelowna to Coldstream, the Regional District of North Okanagan would be responsible for $1.9 million.

“The expectation is there will be no impact on taxpayers,” said David Sewell, RDNO chief administrative officer.

The funds will come out of a reserve created in 2005 when Greater Vernon residents agreed to borrow $7.5 million for parkland acquisition. About $7 million remains in the account.

“We are already paying interest so there is no incremental impact on taxes,” said Sewell of the CN land deal.

RDNO’s $1.9 million is based on the property value of the corridor within the regional district.

The District of Lake Country’s share is $5.1 million. To minimize the current tax impact to residents, the municipality may seek public approval to borrow up to 50 per cent of the amount.

“That is a possibility but council has to discuss that further,” said Mayor James Baker, adding that the issue will be considered by council Tuesday and the district may seek to borrow the entire cost.

Lake Country has also entered into an agreement in which the City of Kelowna would acquire a 50 per cent interest in the land within Lake Country on a temporary basis. This would reduce the immediate cost to Lake Country it purchases the share back from Kelowna.

“It makes it a little easier for our tax burden initially,” said Baker.

Kelowna staff supports the deal with lake Country.

“The arrangement alleviates the debt load for the District of Lake Country’s residents, protects the opportunity of all the jurisdictions to finalize the deal with CN and preserves the corridor as a continuous route physically connecting the communities of the central and north Okanagan with no current tax impact for Kelowna residents,” said Doug Gilchrist, divisional director community planning and real estate for the City of Kelowna.

Beyond its assistance to Lake Country, Kelowna estimates its share of the purchase price at $7.6 million. It would be funded from reserves and interim financing with no additional tax increase needed.

All of the participating jurisdictions are also looking at ways to raise the remaining $7.3 million of the agreement purchase amount through grants and partnerships before the due diligence process for purchase ends.

 

 

 

 

 

 

 

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