Lansdowne 2.0 plans offered little in the way of choice

Over four days of marathon meetings that saw a steady stream of emotional speeches, pointed questions to staff and at least one councillor pound their fists on the table in frustration, a key shortfall of the Lansdowne 2.0 redevelopment became clear.

Alternatives to the $419-million plan were never fully explored, but that's because staff weren't told to do so.

Staff spent thousands of hours investigating how to ensure a proposal from the Ottawa Sports and Entertainment Group (OSEG) would ensure its partnership with the city is finally financially sustainable.

The problems with Lansdowne Park are obvious and undisputable.

While Lansdowne successfully managed to attract four million annual trips to a site that was once a state of disrepair, it has not been able to make a profit.

If the partnership was not renegotiated, deputy treasurer Isabelle Jasmine says it would provide the city's private partner with a mere one per cent return on investment over 40 years, "less than you can get from putting your money into a GIC."

Given the site's track record of repeatedly failing to meet projections, even that is far from certain.

Avoiding the cost of doing nothing

The hulking staff report on the project painted a bleak alternative to voting yes.

The so-called "do nothing option" presumed just that — a reality in which councillors not only voted no, but opted to stall any progress at the site for up to 50 years.

Staff painted a picture where OSEG abandons its $160-million investment and waves goodbye to everything it had hoped to achieve, leaving the city on the hook for costs that could balloon up to $625 million.

It's a proposition many Lansdowne 2.0 detractors dismissed as an empty scare tactic.

Coun. Shawn Menard called the premise as "false and completely misleading," publishing a fulsome response on a website he launched in May optimistically called "A Better Lansdowne."

Fellow downtown councillor, Ariel Troster, likewise questioned the proposition.

"I resent being offered one choice when there are obviously different choices that we could be making," she said in a final comment before the vote.

Coun. Shawn Menard spoke at a rally calling for changes to Lansdowne 2.0, before the first day of public delegations. (Elyse Skura/CBC)

Staff only directed to explore one option

Time and again over the multi-day meeting, councillors asked for data and opinion from Jasmine and Lansdowne project manager Sean Moore on different aspects of the site.

Each time, came a similar refrain: We were following the primary direction to make this financially sustainable.

But what could come across to the casual observer as obfuscation or purposeful misdirection is simply evidence of staff working within strict constraints laid out for them.

Staff can only explore options council presents them with. The previous council, in effect, tied their hands by giving them one objective: make Lansdowne 2.0, as envisioned by OSEG, financially viable.

And that plan was optimistic, to say the least.

One could argue that OSEG is at fault for attempting to make a profitable venture by relying on city-owned infrastructure. But it too was given a nearly impossible proposition.

Lansdowne 2.0's primary aim is to finally make the partnership financially sustainable. (Andrew Foote/CBC)

Project's complex finances questioned

Lansdowne 1.0 was created with the goal of being "revenue neutral." But the idea that a sporting facility — with its economic viability tied with how well athletes perform — could ever be a rock-solid investment is flawed.

Take a look at the city's financial due diligence, performed by Ernst & Young, or consult one of several independent economists who spoke out against the proposal.

Among the more than 80 public speakers at last week's joint committee were experts who poked and prodded the complex finances and came to warn councillors against tying the city to a $312.7-million loan — which staff say will grow by $5.9 million to accommodate a new affordable housing component.

Ernst & Young provided a more than 100-page report analyzing the partnership's financials and forecasting how the teams, the stadium, and the retail market will perform over the next four decades.

Beyond the economic disruptions caused by construction — set to be offset by the city — the experts noted a number of other risks including public sector job cuts, interest rate hikes, labour shortages and the potential creation of a new downtown arena and event centre at Lebreton Flats.

The most profitable aspect of the site, its retail tenants, will actually be weakened by the plan which now sees very little additional space added.

The new retail space at the site will be similar in size to what currently exists near the north-side stands. But long-term projections for the profitable retail arm of the partnership had to be scaled down because of construction-related disruptions. (City of Ottawa)

A chance to respond

Over the past two weeks, OSEG executives spent hours in the public gallery listening to criticisms of the partnership occasionally shaking their head at the comments, questions and explanations.

"I think a lot of people's concerns came around misinformation," OSEG CEO Mark Goudie told Ottawa Morning host Hallie Cotnam.  "We're kind of talking through some of the hysteria."

Goudie also noted that the replacement of the 1960s-era facilities is something that probably "should have happened back in 2013" when the plan was focused on convincing the city that its unsolicited development proposal would ensure a full return on investment — and a profit.

Well over ten hours into non-stop meetings, after councillors had already decided they were too tired to make any final decisions, Goudie and OSEG chair Roger Greenberg were given the opportunity to respond to concerns.

Greenberg reminded councillors to treat this as a public-private partnership.

"With all due respect, it's not a question of one partner saying, 'Well, we're going to institute all these changes.'"

Chair of OSEG Roger Greenberg, left, executive director of OSEG Foundation Janice Barressi, centre, and OSEG CEO Mark Goudie appeared before a joint committee on the first of four marathon meeting days on Nov. 2. (Francis Ferland/CBC News)

OSEG tries to 'set the record straight'

The company also took that campaign outside council chambers.

Remember Menard's Lansdowne website? Anyone googling "A Better Lansdowne" now will find a sponsored post at the top of the search results: a webpage called "An Even Better Lansdowne."

When asked to comment on the latter site — created by OSEG — Menard smiled and shrugged his shoulders. Imitation, he quipped, is a form of flattery.

"Does the community support plans to invest in the future of Lansdowne?" the page asks on the FAQ page. "Yes," it answers.

In the days leading up to public delegations, OSEG posted a new survey to "An Even Better Lansdowne" suggesting support unseen in the city's own consultations. The final delegate, EKOS pollster Frank Graves, spent 30 minutes outlining the results and passionately defended its methodology.

"We've been trying to set the record straight," Goudie later said.

'Small' backlash, anything but

While Mayor Mark Sutcliffe was a supporter of the project from start to finish, he ended Thursday by saying the days of councillor input had improved it overall.

OSEG seemed less emphatic, suggesting there could be "hiccups" that need to be addressed. But Goudie also said he took "lots of notes" and would be taking a step back to focus on making the site the best it can be.

It's a marked difference in tone from a media briefing a month earlier, when the mayor said the city let things crumble out of worry about "a small political backlash."

Backlash? Yes.

Small? Anything but.

People rallied outside Ottawa City Hall before the first day of delegations addressing Lansdowne 2.0 on Nov. 2. (Francis Ferland/CBC News)