On December 18, Edmonton’s City Council voted 7-4 to build the southwest recreation complex, slated to open in July 2009, as a P3. A private consortium will design, build finance and operate (DBFO) the facility, with the City retaining only the operations of the recreation centre (non-arena) portion of the centre.
In June 2006, Council decided to explore a P3 for the arena portion of the then-$90 million project, and directed Administration to explore public financing and ownership of the non-arena portion. The Request for Proposals (RFP) closed in June 2007, but one of the bidders went beyond the project parameters, and proposed developing the entire recreation complex as a P3. In short, it was the private sector, and not Council, that determined the parameters of the project and the extent of private participation in providing a public service, absent the chance for meaningful public debate.
This is an extraordinary abdication by Council of its responsibility to set a vision and priorities for the City, and sets a very dangerous precedent for private dicta. If it is apparent that Council will allow the private sector to dictate the parameters of major projects, contractors will be reluctant to bid competitively on traditional contracts, and will instead attempt to force the City into requesting more profitable (for the private sector) P3 bids. By approving the recreation centre P3, Council has indicated that it is willing to delegate the task of envisioning what it means to provide a truly public service to private contractors.
Through this abdication, Council is complicit in a dangerous redefinition of the nature of public service. Under the P3 deal, the City will purchase 3500 hours of ice time at market rates from the private owner and will re-sell the hours at lower rates to minor sport groups. The 3500 hours represents the bulk of the available ice time for two of the four ice sheets. Ice time for the other two sheets will be sold by the private owner at prices determined solely by the private owner, for the purpose of increasing revenue. In short, this means that only two of the four sheets will be built for community access, while the other two sheets will be private revenue properties to be built without regard for community accessibility. Since under a P3 the City does still pay the entire cost of construction, this means that public funds will be used to construct a private revenue property. This is a major and dangerous philosophical shift in the purpose of public services, and it is simply not acceptable for Council, our public representatives, to have abdicated the responsibility for making such a shift to the private sector.
Other Edmonton recreation facilities, notably the Kinsmen Twin Arena and several soccer centres, are operated through partnership with non-profit groups. However, these partnerships are very different from the approved P3, and in those cases, the City specifically sought out non-profit partners. The dictation of the project parameters by the private sector is an entirely different procurement model, and the construction of a facility as a private revenue property represents a completely different philosophy of public service provision.
It is not even the case that Council had the opportunity to fully assess the parameters dictated by the private players, as Council was unable to access crucial information throughout its deliberations, in part because information about the specifics of the deal simply was not available. The P3 was approved despite significant unanswered questions about accessibility, fee structures, financing, construction models, expected profit margins, revenue and risk sharing, quality and maintenance guarantees, liabilities, dispute resolution and especially about the ongoing disclosure of information.
Even the identity of the private partner in the southwest project still remains confidential to the public, and the basic terms of the deal have never been made public. Informed public debate has been impossible, and Council has failed to insist upon a transparent, open and publicly directed process.
Get involved, and let your Councillors know that you are not willing to sacrifice the public interest and let the private sector dictate your priorities.
Contact your Councillor. Contact information is provided below, and an expression of your concerns in your own words is most effective.
Click here to read Parkland Institute Executive Director Ricardo Acuna's recent article describing further the dangers associated with this proposal.
Click here to read the December 17 editorial by PIA Executive Director Bill Moore-Kilgannon, who highlights significant concerns about accountability and transparency on this project.
Click here to read the Edmonton Journal's article reporting the dangers associated with recreation centres and the caution urged by Ottawa City Councillor Alex Cullen, or read the Edmonton Journal's editorials of December 7 and December 20.
