Estimates go as high as $1 Billion. They apparently knew for years (2007) that the project would be in trouble and the City's investment would be at risk, but I didn't hear anything until the credit crisis conveniently came along in late 2008 to blame it on.
There was a secret deal (that's what in camera means) to lend $100 Million to the project in fall of 2008, and now we are in it up to $1 Billion.
That is unfortunately the down-side of PPP (Public Private Projects) the Private gets all the profits and the Public walks off with the losses. What else should we expect when we get Wall Street financiers and Developers signing contracts with council-folk who spend most of their time wondering how to increase hockey hours on the local ice-rinks. Lamb to be sheered.
The question is - who advised the CITY? Which law firms or financial institutions-anyone know. What is their liability in all this?
How much is $1 Billion? Well hopefully the city won't lose that much, but to put it in perspective, it is one year's total annual revenue +/- or it is double the current outstanding debt.
As for our debt rating, I checked and the city's short term debt seems to be holding up well - comparable to the banks but that could change
It is truly a scandal as Gary Mason says and if it bites the COV badly then we can look forward to reduced services.
