Ottawa’s latest Lansdowne Park redevelopment plan includes a reserve for potential cost overruns, despite facing risks such as tariffs and construction delays. The city’s auditor general, Nathalie Gougeon, has updated her assessment, pointing out aggressive revenue assumptions not aligning with the CFL team’s historical performance.
Gougeon will present her findings to the audit committee before the city council votes on approving the estimated $483 million expenditure for the project, mostly funded through debt. The plan involves significant investments in a new arena, stadium stands, underground parking, and retail space.
The extension of the city’s partnership with the Ottawa Sports and Entertainment Group (OSEG) until 2075, instead of the initial 2066, is highlighted as a heightened risk. Gougeon emphasizes the importance of accurate financial forecasting and warns about potential budget overruns and delays.
The City of Ottawa is accountable for managing the costs and risks associated with the project, including uncertainties related to soft costs, price fluctuations, and integration challenges with retail and future towers. The auditor raises concerns about the impact of U.S. tariffs on construction materials, which could lead to budget overruns and disputes.
In addition, potential penalties related to delays in tower construction and business interruption costs during the project’s execution are outlined. Gougeon stresses the necessity of a sufficient contingency fund to mitigate risks.
The funding strategy for Lansdowne 2.0 involves drawing from capital and stormwater reserves, as well as annual budget allocations. However, the allocation of funds raises concerns about missed opportunities for other municipal needs.
The city’s reliance on projected new revenues, including retail and Redblacks ticket sales, to cover the project’s debt is scrutinized. While retail revenue assumptions are deemed reasonable, uncertainties surround the Redblacks’ financial performance projections.
Mayor Mark Sutcliffe acknowledges the audit’s concerns and emphasizes the importance of ongoing reporting and risk management for the project. The audit committee will assess Gougeon’s report before the council’s final vote on Friday.