Winnipeg Transit's purchase of Manitoba Hydro land up in the air

Winnipeg's proposed purchase of Manitoba Hydro land needed for the Southwest Transitway is now up in the air.

Mayor Brian Bowman and members of city council took part in a closed-door seminar Monday afternoon to hear about the transaction, which would see the city acquire a parcel of Fort Garry land from the Crown corporation for $20.4 million.

Winnipeg Transit director Dave Wardrop has said if council doesn't approve the deal on Wednesday at its monthly meeting, it could jeopardize the $587-million second phase of the Southwest Transitway, a bus corridor connecting downtown with the University of Manitoba's Fort Garry campus.

• Winnipeg councillors accuse Manitoba Hydro of bad faith in $20.4M land deal

• ANALYSIS: Another day at city hall, another contentious real-estate negotiation

An increasing number of councillors are expressing reservations about the deal. Some who voted in favour of the purchase at the committee level — including Couns. Janice Lukes (South Winnipeg-St. Norbert) and Matt Allard (St. Boniface) — are now sitting on the fence.

With councillors such as Jeff Browaty (North Kildonan), Shawn Dobson (St. Charles) and Russ Wyatt (Transcona) poised to vote against the deal, it's possible there may not be enough votes in favour of the deal to pass it on Wednesday.

The city initially expected to buy the Hydro land for $4.7 million, based on a third-party appraisal and the belief it had an agreement with the Crown corporation. Hydro then obtained an appraisal of its own that placed the land's value at $32 million to $34 million.

Subsequent negotiations led to a sale price of $20.4 million. Council's executive policy committee approved the deal last week in spite of complaints by council finance chair Marty Morantz (Charleswood-Tuxedo-Whyte Ridge) and Lukes that Hydro was negotiating in bad faith.

Browaty said Monday the cost is just too much, even as Wardrop has assured council it will be covered by the contingency margin built into the transitway project.

"This is proof positive that we should just entirely scrap phase two of rapid transit. The number on this is too big," Browaty said after emerging from the closed-door council seminar.

"I just don't think Winnipeggers value this project enough. I think our basic roads in the city need our attention (and) $590 million for this glorified bus route just doesn't make sense."

Browaty said the sale price could set a precedent and force the city to pay higher prices for other parcels of land in Fort Garry.

At a separate closed-door meeting on Monday, Hydro's newly appointed board met to consider the sale, among a series of other items. Bruce Owen, a spokesman for the Crown corporation, said the board's decision on the deal should be made public on Tuesday.

Winnipeg Mayor Brian Bowman said he's awaiting Hydro's decision. He said council is engaging in due diligence as it considers the deal.