The funding for the library (not the housing units) would come from the provincial-federal Community, Culture, and Recreation Program.
The building would be located on city property next door to city hall at the corner of Ward Street and Front Street. A detailed design document is attached below.
The proposed five-year project is part of the city’s attempt to create shovel-ready capital projects to stimulate the economy during the pandemic.
The budget for the library portion of the project is $13,888,200.
If the city receives the $10-million grant, the remaining $3,703,983 million could come from the city in the following ways:
• $1,500,000 borrowed short-term under Section 175 of the Community Charter, repayable over five years at approximately $285,000 per year from the city’s water license reserve.
• $1,200,000 from the city’s land sales reserve, which is funded by sales of land including the recent sale of the lot at Hall and Front Streets to a developer.
• $1,003,983 from profits from the Fortis BC LILO (lease in, lease out) arrangement, a complex deal with Fortis BC that stemmed from Nelson’s past ownership of the gas distribution system in the city that created a capital asset the city can borrow against.
City manager Kevin Cormack told council that these three possible internal funding sources might not be necessary and that the city will be looking for more external funds. He pointed out that “the Columbia Basin Trust has just funded a new Kaslo library to the tune of $3 million.”
“We might not have to use all these sources, we just had to prove to the managers of the grant that we have the capacity,” he said.
He emphasized that the $13,888,200 including the city’s contribution is for the library only, not for housing. He said it could be a stand-alone library if necessary, that the housing component is still under discussion with BC Housing and the private sector, and that income from the housing could conceivably pay for the city’s contribution to the cost of the building.
“Council still has not made a decision on whether it is market housing or subsidized, but staff’s original idea was that there would be some profit from it, that it would help to pay this down, but we have not accounted for that at this stage.”
Mayor John Dooley, speaking in favour of the project, said, “In this world if you can build a new building for $3,700,000, you build it.”
The proposed building would use mass timber, local employment, local businesses, and a new version of the city’s proposed district energy system.
Council’s vote on Oct. 13 not only allowed for the grant application but supported the project concept and committed to the city’s share of $3,703,983.