Banff politicians have postponed a decision on borrowing money to fund part of a $1 million purchase of Bow Valley Credit Union’s building in the 200 block of Beaver Street.
Town council approved purchase of the building on March 29 on a close 4-3 vote, but a bylaw to borrow about $670,000 to help pay for it was up for discussion on Monday (April 11) – and some councillors wanted additional information.
Administration has been directed to bring back a report to the April 25 council meeting outlining a business plan on projected revenues and expenses for the building, potential future tenants and whether there is currently demand for office space in town.
“I’m not saying there isn’t a business case for purchasing this, but I don’t believe administration has clearly articulated that,” said Councillor Stavros Karlos, who voted against the purchase of the building on March 29.
The Bow Valley Regional Transit Services Commission currently rents the lower floor of the Credit Union’s building at 221 Beaver Street, while the upper level, with a three-bedroom housing unit and den, houses a tenant.
The Town of Banff is currently paying about 85 per cent of the transit commission’s rent for the property as a partner in the commission.
The building is located in the public service land use district and was the site of a lengthy legal dispute between Parks Canada and the Town of Banff when the Municipal Planning Commission gave the green light for a lawyer’s office to open there.
Parks Canada, which won the dispute in court, believed the municipality was trying to expand its commercial footprint by circumventing the commercial development cap. The Town stated a lawyers’ office was a public service.
Bow Valley Credit Union and the Town have agreed on a sale price of $1,005,000 based on the average value of two appraisals.
Administration’s recommendation is to borrow $670,000, which would be paid back by rents over the next 30 years, and to fund the rest of the purchase from the general capital reserve.
However, at Monday’s meeting to debate the borrowing bylaw, Mayor Karen Sorensen, who supported purchase of the building, was absent, meaning there was a good chance the bylaw would be defeated on a 3-3 vote given how councillors voted on the actual purchase.
Kelly Gibson, the Town of Banff’s corporate services manager, said it would put the municipality in a tricky situation if the bylaw to borrow money was defeated.
“We have council’s approval to go ahead with the purchase, so it puts us in an odd spot if we have no way of funding it,” he said.
“We would look for direction from council on what we could bring back for the next meeting as far as alternatives for funding.”
Coun. Grant Canning, who did not support purchase of the building, also didn’t want to support borrowing money to pay for it.
“I don’t feel comfortable putting my name on approval of a borrowing bylaw on a building I don’t feel we should buy,” he said.
“I don’t think it’s appropriate for the Town to be entering into non-residential property management. I think that is outside the realm of a municipality and I don’t think we should be going down that road.”
Coun. Brian Standish voiced support for first reading of the borrowing bylaw.
“I will be supporting first reading of bylaw for the simple reason, and we’ve heard it many times – land is king,” he said.
“We’re currently paying 85 per cent of the rent (as a partner in the transit commission) and I believe we should be paying ourselves and not someone else’s mortgage.”
Karlos said he believes there are limited opportunities to rent this space in the future given the property is zoned public service.
“This is a not a traditional piece of commercial property. PS lands, and the subsequent court cases, limit what can go there. There are limited opportunities for rental in the future,” he said.
Karlos said he’s also not sure there is great demand for office space in Banff.
“It’s my understanding that office space is not oversubscribed, so this isn’t something that has massive demand,” he said.
The land use is currently zoned public service, the purpose of which is to provide a wide variety of uses of an institutional, government, educational or community service nature. Currently, apartment housing is only permitted above the first floor.
