WINNIPEG — The Province of Manitoba is refinancing a $35.3-million loan obtained by Triple B Stadium Inc. to shield taxpayers’ from approximately $500,000 in annual interest charges when it comes to Investors Group Field.
“The actions we are announcing today will reduce the risk to taxpayers,” said Finance Minister Scott Fielding in a statement. “This is one more step in our efforts to clean up the financial mess caused by the previous government’s mishandling of the financing of the construction of the stadium.”
The minister noted the $500,000 in annual savings will be achieved because the province can borrow at a lower rate of interest than the rate of the loan obtained by Triple B.
According to Fielding, the refinancing will have no adverse impact on the province’s financial exposure because there is no difference between providing a loan guarantee and directly providing a loan in the event of default.
The loan guarantee for Triple B was provided by the province in 2015 for $35.5 million for urgent repairs to Investors Group Field (IGF). As of November 2018, a total of $25.5 million has been borrowed by Triple B.
The repairs were done after inspections showed 42 deficiencies, including water damage caused by insufficient drainage in the building, as well as inadequate insulation and “extensive” cracking in the concrete.
In addition to the construction deficiency loan, the previous government approved an initial loan of $160 million to the University of Manitoba (U of M) in 2011 to finance construction of IGF. The U of M then loaned that money to Triple B.
Fielding called this “a deceptive scheme” that made it impossible for Triple B and the Winnipeg Football Club to pay the interest on the loan, let alone the cost of ongoing capital maintenance and repairs to the stadium.
Last year, the provincial comptroller determined Manitoba was unlikely to recover the $160-million loan. Because of this, in accordance with public-sector accounting standards, an allowance was made in the 2018 and 2017 public accounts for what has been deemed to be a doubtful loan.
The province continues to collect on the terms of the $160-million loan, and both Triple B and the Winnipeg Football Club remain obligated to meet their contractual commitments under the terms of that loan agreement.
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