By Lethbridge Herald on December 21, 2023.
Al Beeber – LETHBRIDGE HERALD – email@example.com
2023 was a year of many news stories and names making news.
It was the year in which Lethbridge residents began seeing the first of four years of successive tax increases following three years of no hikes.
It was a year when the cost of buying gas, groceries and housing all increased and a year when low water levels in the Oldman dam began to raise serious concerns.
It was a year when fewer encampments were seen around the city but one in which residents spoke loudly about their concerns with crime. And those concerns were answered when the province announced it was setting up a SCAN unit here in Lethbridge and when council launched a task force on lawlessness and crime to be focused – at least initially – on the downtown core.
But standing tall above all the other stories and newsmakers was one – the Lethbridge & District Exhibition and it’s new Agri-Food Hub and Trade Centre which is facing serious financial trouble.
Before the paint had even dried on the massive new structure overlooking Henderson Lake, cracks were figuratively appearing in the foundation of the new hub which was built to replace the aging pavilions at Exhibition park in the hopes of attracting new conventions and business to this city in what some call the premier agri-food corridor in Canada.
Even though he’d told city council on Aug. 10, 2020 that the cost of demolishing three pavilions was part of the original $70.5 million capital cost of the project, then Chief Executive Officer Mike Warkentin said in March to the Economic Standing Policy Committee of Lethbridge city council that the Exhibition needed more than $4.6 million to proceed with that demolition.
Warkentin told the SPC that the original cost of the new trade centre had escalated millions of dollars over its projected budget.
At that meeting, Warkentin said the Exhibition was forecasting a loss for this year and was working to mitigate it. In November, when he returned to council asking for the City to immediately take possession of the pavilions and give it emergency financial assistance, he said the Exhibition expected to lose money for three to four years.
In the summer, however, after its grand opening in August featuring a multitude of dignitaries, the Exhibition chose to give free admission to Whoop-Up Days which attracted record crowds, a matter that prompted much discussion among the public due to the earlier request for funding to demolish the pavilions.
The hub was built in part with $27.8 million from the province of Alberta and $25 million from the City of Lethbridge. The City also backstopped a loan to the Exhibition of nearly $18 million while Lethbridge County contributed $2 million to the project.
Ground was broken on the 288,000 square foot facility in March of 2021. Of that space 268,000 sq. ft. is considered multifunctional.
Total cost of the project is expected now to be $77.3 million, about seven per cent over budget but below the 15 per cent average in the province.
At the grand opening, Warkentin said the Exhibition removed $9.7 million out of the facility’s budget, adding he didn’t think anybody would notice.
The Hub has 104,000 square feet of trade halls, four meeting rooms that are all about 1,100 sq. ft. and three salon banquet rooms that total just over 13,000 sq. ft.
A new facility has long been a dream here of the Exhibition with the first feasibility study conducted in 2002.
More than 300,000 labour man hours were involved in the project to get the Hub to the point where doors could be opened to the public. One hundred per cent of those man hours were Alberta organizations and 67 per cent were Lethbridge businesses.
In November, Warkentin appeared before council asking the City for a capital grant in the amount of $6,742,315.72 or a capital grant in the amount of $2,081,093 to cover the unfunded capital of construction and a four-year debt deferral to be repaid on the back of the loan, totalling $4,671,309.72.
Council agreed to support the Exhibition contingent upon the province agreeing to pay half of a capital grant of $2,081,093 to the organization. That motion was several approved at that November meeting, all of which hinged on provincial money being provided.
Earlier this month, the province declined to provide that funding, telling the mayor in a letter read to council that because the viability of the current business plan is in doubt, the province declines to provide the requested $1,040,546.50 to the city.”
As council debated in closed session on Dec. 18, the Exhibition announced in a press release that it and Warkentin had mutually agreed to part ways.
That departure was followed hours later by an announcement that the City would a provide emergency interim financial support to the Exhibition of $250,000 and set aside up to $950,000 in contingency held under City control “for verified emergent needs.”
The council resolution also called for an independent third-party review of the Exhibition and the establishment of a new governance body consisting of administrative staff from the City and Lethbridge County.
A deadline has been set of Jan. 19 for a Memorandum of Understanding to be signed with council to address the matter again on Jan. 23.
On Dec. 19, mayor Blaine Hyggen told media that the City was protecting its investment in the Exhibition with the financial lifeline.
“We do have an investment so we want to make sure that investment is protected,” said the mayor, adding it’s important to start out with a clean slate and to have transparency.
The mayor told media the City had the same red flags about the Exhibition “on a community level” that the province had.
Now with the year ending, time will tell very soon if the Exhibition is again in the running for the top newsmaker in 2024. We’ll find out possibly on Jan. 23.