(Photo: LNN)

By Christian Oldale

City of Lethbridge exploring funding options for Lethbridge & District Exhibition

Nov 28, 2024 | 10:55 AM

LETHBRIDGE, AB – The City of Lethbridge Economic & Finance Standing Policy Committee (SPC) held a review of the finances of the Lethbridge & District Exhibition (LDE) on Wednesday, November 27, 2024.

The review, which covered managing debt, ongoing operations and future capital costs for the Agri-Food Hub & Trade Centre, comes on the heels of a report by Deloitte Canada, revealing widespread mismanagement of funds in the organization.

READ MORE: Widespread mismanagement revealed in Lethbridge & District Exhibition report

On Wednesday, the SPC put forward two recommendations for City Council:

1. Future Capital Costs
   Two significant capital costs still required by LDE are the demolition of the old Exhibition pavilions and the reconstruction of the parking lot. After a thorough review of the old pavilions, it has been determined that it is not economically feasible to repurpose them. The SPC recommended that Council consider the demolition of the old buildings except for the west pavilion which would be maintained for storage. The Economic SPC approved a recommendation to refer both the demolition and the parking lot reconstruction to the 2027-2030 Capital Improvement Program (CIP) deliberations.
2. Future operating models
   In alignment with the options provided in the Deloitte report, the Economic SPC recommended that work proceed on exploring a new operating model for LDE. This includes the development of a recommended business plan, implementation plan and budget for a municipally-controlled corporation to consolidate event attraction across Lethbridge.

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Lethbridge mayor Blaine Hyggen said, “In order to determine where we are going, we need to have a good understanding of how we got here. The third-party review gave us that foundation. The reality is, there is no easy way out of this. We don’t like it, and we don’t want to be here, but now Council has to consider what the best option is for the betterment of the entire community.”

SPC reviewed the option of shutting down the building versus continuing the operations, but the City says the closure of the facility in 2025 would cost approximately $4.1 million with no community benefit. They say the same cost to keep it open will bring more entertainment, cultural and economic benefits to Lethbridge.

In addition, the City’s finance department presented options to reduce the $17 million loan LDE is currently paying for their portion of the Agri-food Hub project. The committee identified unused grant funding as a potential way to pay down the loan by more than $7 million.

They add that this, along with refinancing from a 30-year to a 10-year term and moving from external to internal borrowing would save City taxpayers $15 million in interest costs.

However, if the cost were to be covered with an increase in property taxes, that would mean an additional 2.24 per cent 2025 on top of the already approved 5.1 per cent for a total increase of 7.34 per cent. This would amount to approximately $60/year on the average single-family home in Lethbridge.

Chief Financial Officer & Treasurer Darrell Mathews says, “To align with our financial principles of not funding an ongoing cost with one-time money, a tax increase in 2025 would provide the least amount of financial risk.”

Further information on LDE updates and city news can be found here.

READ MORE: Lethbridge News Now.

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