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Kirwan defends his claim the Kingsway Entertainment District will pay for itself

Says taxpayers should stop fighting over the Kingsway and 'start fighting for the Kingsway'

The city needs to take advantage of making money through commercial taxation in order to support future projects like a downtown arts centre and library.

That was the message from Ward 5 Coun. Robert Kirwan during a Jan. 30 interview with Sudbury.com. In a response to an op-ed piece the city councillor had written in which he was vehement in his defence of the Kingsway Entertainment District project, arguing the development would basically pay for itself.

Sudbury.com asked the councillor if he could put some dollar figures to that claim.

Kirwan wants to see the city start to operate more like a business, and take advantage of commercial property tax dollars and keep residential property taxes down.

"This is probably the first time that I can remember that the city has done something like a business," said Kirwan. "The reason that we're doing it this way is because we're in a partnership with three private-sector companies. We're the only public-sector partner so we've got to work at the speed of business and work like business people."

According to Kirwan's numbers, the city stands to make anywhere from $5 million to $6 million annually in new taxation from having both a casino and hotel as part of the Kingsway Entertainment District. 

At a commercial tax rate of 2.54 per cent, the city would be collecting around $3 million from the two buildings in taxes, plus a projected $2 million in new shared casino revenue, on top of the roughly $2.1 million the city receives currently from the slots facility at Sudbury Downs and expects to receive from the new casino.

Kirwan also pointed to the potential for development on the nearby 120 acres of land and says that a number of businesses are ready to set up shop, which would mean more commercial tax dollars for the city to fund downtown development.

"We can't identify anyone because nobody's committing to anything yet, they're businesses, nobody says what they're going to do or where they're going to go," said Kirwan. "But we know from talking to the developer (Dario Zulich) that there are a number of businesses that are ready to go there. The amount of development that's going to go around that is going to be huge and that's all commercial taxation."

The city will be investing $5.5 million annually in order to mortgage a new arena. In addition to mortgage payments, a PricewaterhouseCoopers report that was presented to council on March 7, 2017, indicated the arena will run a deficit of $655,700 in year one and increase annually up to $825,200 in year five.  

Kirwan says the revenue from commercial taxes once all of the land has been developed will more than pay for the mortgage and operational losses, and will be in the range of $8 million or $9 million dollars annually.

"We're looking at the downtown, with the library and the art gallery and convention centre, and we know there's interest in a couple high-end hotels across the street and that's more commercial taxation," said Kirwan.

"The reason I'm so adamant about the Kingsway is that we need the Kingsway so we can build the downtown up. We've got to stop raising taxes. We can't just continue to raise taxes and expect to pay for it with residential property taxes."

There have been a number of outspoken groups who have taken up a stance against the Kingsway Development, as well as groups that have spoken out against building a casino in Sudbury, with the former being largely made up of downtown supporters who don't want to see the arena moved out of the city's downtown.

"You're looking at all this controversy, and my God ... the arena on the Kingsway is being done for the downtown," said Kirwan. 

"It's being done to build up the downtown ... the Elgin Greenway, the Place des Arts, keeping the Sudbury Theatre Centre going, that whole area where the library, art gallery and performance centre are going to be with a new upper-end hotel ... the downtown is going to flourish."

The city has put aside 0.3 per cent of the 2018 budget, which amounts to around $700,000, plus a further $700,000 annually ahead of the projected opening of the arena on the Kingsway to start paying for things like consultant fees, and planning for the Kingsway development. The tentative opening date for the arena is April 1, 2020, and Kirwan says that the city will start seeing tax revenue as soon as they start paying the mortgage on the arena. 

"The amount of money we're going to make off the Kingsway is going to easily pay for the arena," said Kirwan. "At the end of the day, we're making money off the Kingsway, it's costing us for the arena, but we're making more money than it's costing us. We're making a profit."

The councillor says that it's time for everyone in the city to get behind the development of a new arena, regardless of their preference on location.

"You may not agree with the decision that the city made for where to put the arena, but let's look at the benefits to the city and make sure it works, instead of fighting it and trying to delay it," said Kirwan.

"Let's just get behind it ... I'm just disappointed that we can't get together and say 'let's stop fighting about the Kingsway' let's fight for the Kingsway and the downtown."