All sides agree that cost-sharing agreement can be cancelled

Greater Sudbury has released details of the cost-sharing agreement for the development of the Kingsway Entertainment District.

The agreement splits costs between the four groups developing the site: the city, Gateway Casinos and developer Dario Zulich, representing himself and a potential hotel owner on the property.

The agreement was announced at the Jan. 15 city council meeting, with a promise to make the details public. It includes a clause that allows the city to terminate the agreement without penalty at any time before the legal battle at the Local Planning Appeals Tribunal aimed at stopping the project is completed.

“We are pleased to make a summary of this complex agreement available to all interested citizens,” Ian Wood, interim GM of community development, said in a news release Monday. “The city’s primary interest in negotiating the agreement was ensuring value for money, protecting taxpayer dollars, and mitigating risk to the community and the organization.”

All parties agree no major work will take place until the LPAT makes a decision, which the city hopes will happen this fall. No date has yet been set for a second case management conference, but a hearing date will be set once that happens.

“Planning work will continue so that this project is shovel-ready once the legal process has been completed,” the release said.

The agreement focuses particularly on the common areas/works and blasting. Each partner is responsible for the development of their own site, including buildings and parking lots. Site preparation costs, which include blasting and grading of the site, are allocated based on each partner’s property area.

“A single contract has been awarded for the blasting and grading,” the release said. “By tendering a single contract for site preparation, there are benefits to all partners that include cost savings, simplification of site management issues, and a shared commitment to achieving the detailed integrated site design.”

Some details of the actual agreement:

The city is responsible for 28 per cent of roadwork costs associated with the site’s development. The three other parties are responsible for the remaining 72 per cent. Road work includes all site servicing required for the properties, including watermain, sanitary sewer, sidewalks, cycling infrastructure, and storm sewers.

Festival Square is designed as a public space for all, and so the city is responsible for the majority of costs. The city will maintain full control of the design of the Square and the programming.

Costs to improve the intersection at the site are being borne 50 per cent by the developer and 28 per cent by the city. The remaining costs are shared between the hotel/conference centre and Gateway.

The city is responsible for 56 per cent of the site preparation and blasting, while Gateway and the hotel are responsible for the remaining 44 per cent of costs. The cost allocation was determined based on property area for each partner, and the arena/event centre is the largest property on the site.

“The cost sharing agreement was an extremely complex undertaking for a transformational project,” Wood said in the release. “All partners are working together and are committed to the successful completion of the project, as evidenced by the signing of the agreement. We look forward to continuing to provide updates to council and the community in the coming months.”

The estimated opening date for the Arena/Event Centre is late 2021 or early 2022.

A full summary of the cost-sharing agreement can be found here..