Another $817,097 is Added to SODC Debt

SODC MAIN

An artists rendering of the SODC project.

By Gagandeep Ghuman
Published: July 27, 2013

SODC added another coat of red to its balance sheet this year, putting $817, 079 more towards its outstanding debt.

The new SODC debt is now $9, 416,314.  Have a News Tip?

It paid just over $200,000 in operational expenses, salaries, office supplies, etc, while the rest was spent on ‘development costs’, although in this case, the cost is clearly more visible than development.

SODC also paid an annual interest of $50,347 on its long term debt.

In March this year, SODC informed the community it had received multiple responses from local, regional and international companies.

“We now have the difficult, but exciting task of choosing the right partner for the community of Squamish,” said Bill McNeney at that time.

Five months later, nothing much has changed.

SODC manager Jonathan Silcock said the transaction process is actively moving forward.

“I can’t share any specifics on numbers, names or status at this point,” he said.

Silcock said more information will be available in the fall, but tongues are already wagging about who might get control over SODC.

According to some sources, two well-known developers from Vancouver and Squamish, both with previous developments in Squamish, are vying for the ownership of the Oceanfront land.

It’s not hard to imagine how a bourgeoning debt, public impatience, and a poor real estate market conditions could all be used as leverage by any developer to get a favourable deal.

Still, considering the debt, that would be a best case scenario.

The worst case scenario is if there are no takers.

That is when the taxpayers are on the hook for millions of dollars in debt.

And with the debt guaranteed by district, it can affect the district borrowing capacity, which is crucial to fund capital projects.

The SODC loan repayment structure is such that the repayments and their timing are compressed within a three year period. 

A maximum of 25 per cent of district revenue can be used to service debt.

When SODC debt repayments are added to what the district has to pay annually to service its debt, the number exceeds the 25 per cent minimum.

 “When we have to come up with that money, it really eats into our borrowing power,” says Joanna Greenlees, the district chief financial officer.

The first principal payment of $3 million is due in June next year.

 

Comments

  1. John Buchanan says:

    The biggest thing that scares me about SODC, is the amount of estuary they plan to fill in to accommodate their Oceanfront development plans. No regard for environment in the future, just build a road through the middle of the estuary , and call it a truck route to sell it to the public.

    • Nate Dolha says:

      Mr. Buchanan, I assume you are referring to the 60m wide transportation corridor, as outlined in the Estuary Management Plan? That plan was approved by all stakeholders, and improved access to our deepwater dock would be a benefit to both the industrial users of our port, and the residents of downtown.

      I’m curious, do you see a better way to handle this traffic in the future?

      • Anonymous says:

        The plan is currently being revisited . This section allowing road construction by filling in the estuary should be thrown out the door. It was one the worse sections dreamed up. There was a lot of back door dealing going on to try and get the plan on paper at the time. It was only intended as a guide line nothing set in stone. Surely we are now smarter as a society and can see the errors of our ways. Anyone who still tows that transportation corridor idea, is usually someone who stands to personally benefit. This road was even attempted to be constructed in 1989 and was condemned by both DFO and our Council of the day. They “BCR” were fined and had to remove a large section of the work they tried to do.

        As far as the deep-water dock goes, I could easily double the size of that operation with little environmental impact, and concentrated on upgrades to the existing loggers lane route that connect them to main south truck route to Vancouver. CN rail trucks have been hauling to the docks for months now and no-one even notices the trucks going by.

        copy and paste this You Tube link CN Truck traffic

        http://www.youtube.com/watch?v=SAgN_F7s_cw

        So really residential traffic is the only thing that needs to be addressed, which can be handle with our existing roads. Or if you like build a bridge over the Mamquam Blind.

        Estuary has lost enough life because of lazy planning. Trouble with people is that we don’t see value in something if we can’t change it to suit our purposes. For once think of the other residents that have to co-exist with us, despite us .
        John

      • John Buchanan says:

        Oh come on, get off the “Quoting the plan”. It was only intended as a guideline and is revisited every few years to add or toss thing as we evolve.
        We have evolved from the stone age of filling in wet lands for the sake of a poorly thought out road at best, by now I am sure.

        Loggers land is the logical choice as a truck route. Even now CN rail has been moving trucks through loggers land to service the deep water port now for months . No one has even noticed.

        Copy and paste this CN Truck link I have provided you below.
        http://www.youtube.com/watch?v=SAgN_F7s_cw

        We need industry, we don’t need lazy planners. I could double the size of the port with little impact. Trouble with planning these days is that they still can’t get past the simple minded solution of filling in wetlands to accomplish their goals.
        In 1989 BCR even tried to build that connector and were stopped dead in their tracks . They were taken to court, fined, and had to remove a very large section of what they filled in and restore the estuary back to how they found it. Even local council of the day condemned it.
        I could double the size of that port with little impact.
        I was part of the first survey asking the public if they supported a road through the Estuary. 95% came back to say no.

        It could be that you don’t understand the environmental and larger economic
        values the Estuary provides.

  2. Mark Kerschbaumer says:

    How in the hell does such a number get to 10Mil and who the hell is responsible for it getting this far?? Must be at or above the value of the land! So what is next – fire sale it to who ever low balls with the condition that they are not bound to all the good planning vision undergone so far?10 Mil…really? Yeesh

  3. Dave says:

    To the SODC:
    Maybe I am missing something but what exactly has been developed? I see nothing of note so why the Debt?…..Oh it must be consulting, consulting and consulting…Silly me!! The more the delay the more the debt and the Filibusters will be lining up in droves. Pathetic.
    Anyway, thanks for the little trench that was perfunctorily dug in the blind channel. That will be good for a year, I suppose. Also, it might be a good idea to do a coliform count in the light of the excessive colonization of the channel by derelict and other “freebee” anchored vessels. I very much doubt they are using holding tanks. Don’t fall in and if you do , keep your mouth closed.
    GET ON WITH IT GUYS or just stop the whole thing.

  4. Jaspera says:

    This is disgusting and unconscionable. Contrary to Nate Dolha, who appears over and over again to have ties to the developers, the so-called transportation was NOT approved by ALL stakeholders. To a large extent the average taxpayers and citizen was left out of the debates or discussions. Much was culminated behind closed doors and in secrecy. It’s time that that the SODC Board was turfed out; all consultants’ contracts terminated, staff fired, and the tax-paying public put in charge of rescuing what has become a very costly , financially irresponsible situation. A Citizens’ Committee composed of a cross-section of knowledgeable citizens who truly have the interests of Squamish and the whole Estuary at heart could not do any worse than the dollar-sucking Board, consultants and hirelings. Maybe such a Committee would bring imagination, commitment, and vision to this wonderful piece of land which was given to the District for a paltry #3!! And it’s time that Squamish taxpayers started to really question the bad handling of the District’s financial situation including the SODC and Oceanfront Lands. Next year this Council wants to hike our taxes another 11% – why? In part to pay down the debt to this boondoggle? It’s time to put a stop this total financial mismanagement.

    • Nate Dolha says:

      Ok, Jaspera, put down the megaphone, I was seeking an answer to a question I had, which was answered with tact and maturity by Mr. Buchanan (thank you).

      For the record, I work in the ports business, container terminals to be exact, and have never worked for a developer.

  5. anonymous says:

    in 2009 we were 2 000,000 in debt

    On Tuesday, March 10, 2009, Squamish Mayor and Council enthusiastically endorsed a proposal by the Squamish Oceanfront Development Corporation (“SODC”) to engage a team of industry experts to create a comprehensive and compelling business plan to realize the vast potential of SODC’s 60 acres of oceanfront land.

    The project team, dubbed the “Ground Crew”, represents a consortium of two companies and three principals, Drew Stotesbury, David Greenfield and Trevor Dunn, who were all senior real estate executives at Intrawest. Their reputation for excellence in planning, developing and operating large-scale, master-planned communities sparked extensive dialogue that resulted in this alliance and the short-term contract to lead the planning process for the SODC lands. In so doing the Ground Crew will, according to the team, “build on the work done to date but also focus on the defining experiences that can elevate the land from a mere real estate opportunity, to a true destination, worthy of its world-class setting, that will attract residents, businesses and visitors to the heart of Squamish.”

    While Ground Crew’s work will focus on the SODC land, the impact on the District of Squamish’s broader “Create the Oceanfront” process will be recognized and supported. It is important that the land use plan for the entire peninsula reflects a fully developed business plan for the SODC portion. Mayor Gardner supports the strategy of parallel exercise. “We have all felt that this property has the ability to unlock the future of Squamish and bringing these talented people on board will go a long way to finding the key to that future.”

    SODC chair, Bill McNeney adds that the timing couldn’t be better. “Not only does this engagement dovetail with the District’s oceanfront planning process but it also allows us to take advantage of time and resources, provided by current markets, to thoughtfully develop the best possible plan for sustainable land use and the creation of homes, jobs and business opportunities – as opposed to density development which has dominated past plans” To facilitate these goals, Mr. McNeney also reports that Drew Stotesbury will serve as the interim CEO of the SODC and report to the board of directors. District Council will also have monthly updates on the progress of the work.

    The District of Squamish, the “Outdoor Recreation Capital of Canada”, is a spectacular seaside, mountain community located at the tip of Howe Sound just 45 minutes north of Vancouver and 45 minutes south of Whistler, British Columbia. It is home to over 15,xxx residents, Quest University, Capilano College and, seasonally, over a thousand bald eagles.

    The Squamish Oceanfront Development Corporation has been created by the District of Squamish to develop the 60 acre, publicly owned Oceanfront property in synergy with adjacent downtown lands. This independent corporation will plan, administer, promote

  6. Dave says:

    Anonymous:
    This recorded section from you puts it all in perspective and here we are in 2013.
    How long will our hope and faith stretch?

  7. Richard Tripp says:

    And so it seems that piece by piece the long rumored plan is coming together.

    If so then I guess the big remaining question is does the intended developer purchasing the Ocean Front lands get to save Squamish from the bank for just the cost of the note or will they toss a few bucks in so they can claim the whole fiasco netted a good return? With the audacity displayed by this crew and their pals on council perhaps they’ll even be confident enough to accept a low ball deal from their golden boy and leave Squamish taxpayers on the hook for some of the bill yet? Recall the park and servicing they wanted to tag on with your borrowed money. This the part where you’re supposed to be grateful the debt is closer to 10mil than 20.

    It still amazes me that during the last municipal election attention was focused on a Auli Parvianien’s ties to a couple of builders, the Sea to Sky Home Builders Association and what likely amounted to a very modest income via those ties. On the other hand little if anything was made of the fact that the parties involved in this and many other large and progressing (some might say favored) developments were involved in many more lucrative manners with past and current faces on council.

    Does anyone recall which Mayoral candidate worked for the bank that held most of the debt this project was carrying? Conflict? I admit to not knowing the legal definition and parameters so I stop short of leveling the accusation myself but from my layman’s perspective something stank then and the smell hasn’t improved since.

    A few years ago it was repeatedly asserted to me, by many, most in better positions to understand the secretive workings of the DOS/SODC relationship than myself, that GAS would be continually stalled, at all costs, to ensure there was no competition for the Ocean Front plans.

    Was it a competing product they feared? Unlikely, as they would be complementary developments to each other, rather than competitive. Was it the sustained boost GAS would bring to the local economy? Perhaps so, as the long term investment brought in and fueled by GAS could be seen by outside developers and proponents as a reason to invest in the Ocean Front, in a long term and comprehensive manner. Increased value in the lands and competition from far more experienced and connected outsiders would create a difficult climate in which to do what they wanted, as cheaply, or perhaps even at all.

    Some have described what is happening as a well engineered theft of a potentially great Squamish asset. Personally I don’t think it is, although sometimes when I ponder what could have been done with this opportunity had it been handled differently, I can understand where that sentiment comes from. I think it is more apt to be good business, which doesn’t necessarily coincide with ethical or moral actions BTW. No doubt the lawyers will make sure it is legal.

    I have to believe that those orchestrating this really do believe in what they are doing and that they are certain it is for the best. What I am not so sure about is do they believe it is the best for them and those who are included in their inner circle or do they really believe it is the best for Squamish as a diverse whole?

    I have no idea and after watching this unfold over the years I don’t think the majority of residents do either. Perhaps that was the intention all along.