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Athletes’ village more complex than it appears

In the previous century, when the bid for the 2010 Winter Olympics was born, the first plan for the Whistler athletes’ village was to use three existing hotels in the village, located close to Whistler Mountain, that could be cordoned off and secured
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In the previous century, when the bid for the 2010 Winter Olympics was born, the first plan for the Whistler athletes’ village was to use three existing hotels in the village, located close to Whistler Mountain, that could be cordoned off and secured. Of course, this was pre-9/11 and the word “security” was still associated with blankets or lock and key companies.

Terry Wright, one of the senior people in the bid corp., a veteran of Expo 86 and previous international Games, and now a senior VP with VANOC, used to talk about coming to understand Whistler and its limits on development. He said it took some time for him and others to realize that a simple solution like building a new athletes’ village on raw land in Whistler didn’t mesh with the community’s plans.

But all that was in the early days, when the main obstacles to overcome were bids from Quebec City and Calgary. Once that hurdle was cleared the bid was analyzed in more detail and it became obvious hotels in the village couldn’t be used for the athletes’ village.

So an athletes’ village would have to be built from scratch somewhere in Whistler. Several sites were considered. The Callaghan valley was a favourite of some, while Rainbow and the Cheakamus area were also evaluated by VANOC. Eventually the people of Whistler decided, wisely, that the Cheakamus area made more sense than the Callaghan.

One of the incentives for Whistler to build an athletes’ village — part of Whistler’s Olympic legacy — was the provincial government’s promise of 300 acres of Crown land, which could only be used for resident-restricted housing. Some of that 300 acres is what the athletes’ village is now being built on. By the summer of 2010 most of that village will be turned over to the municipality and become resident-restricted housing. A simple, clean solution to one of Whistler’s long-standing problems. But how we get from here to there in the next three years is a little more complex.

The municipality’s draft five-year financial plan for 2007-2011 states of the athletes’ village: “The entire project is expected to cost about $130 million with VANOC providing $36 million in 2007. The municipality will finance the balance of the development with short-term construction loans starting in 2008. The expectation is that in 2007 this construction will have no impact on the municipality’s debt level.”

So the province has provided the land, VANOC is putting up the first money to get started, and the municipality, through its Whistler 2020 Development Corporation, is going to work with private developers to get the project done. It’s these deals with developers that may prove interesting.

The assumption is the Development Corporation will entertain bids from private firms to construct various portions of the athletes’ village. A contract price will be agreed to and the municipality will provide the financing to make it happen. If the athletes’ village does come in on budget at $130 million and VANOC’s contribution is $36 million this year (plus whatever it spent last year in preparing the site), that leaves the municipality financing nearly $94 million.

However, the draft five year financial plan also states: “At current rates of market interest the total borrowing power of the municipality is approximately $95 million.”

That would seem to put the RMOW dangerously close to maxing out its credit limit if the municipality was going to borrow all the money it needs to finance the athletes’ village. But it doesn’t need to.

The plan was that every year for four years $2 million of the new hotel tax funds was going to go toward a reserve to help fund the athletes’ village. That plan had to be revised when the province decided it didn’t want the additional hotel tax funds associated with the Olympics. However, there are other reserves that will help finance the village construction. As well, the municipality can sell a few lots at market value to help with financing. Last fall acting auditor general Arn van Iersel estimated the market lots would bring in about $4 million.

The more interesting part of the equation is trying to figure out what the market for resident-restricted housing may be in 2010. Projects on the books that likely will be built in the next three years include 250 units at Rainbow, 80 units that are part of the Nita Lake Lodge development, a new building opening in Function Junction this year, a few units at Lakecrest, a few in the Fitzsimmons Walk development and Intrawest’s project at Spring Creek. Meanwhile, the municipality could be borrowing money over that same time to finance the athletes’ village, expecting a return in 2010, only to find that the demand for resident-restricted housing is not what it once was.

Thus there are discussions with Intrawest and the Nita Lake Lodge people about incorporating their housing projects into the athletes’ village site. What incentives may be needed to accomplish this remain to be seen, although Intrawest does have some “floating” bed units it would like to use up.

But the simple housing solution, building an athletes’ village from scratch, appears to have become somewhat more complex.