Fredericton council decides to fund housing project 4 days after it said no

Fredericton council voted Friday night to make funding available for a housing project at the City Motel, reversing a decision it made just four days earlier.

The project will include 20 affordable housing units, 12 peer-supported units and a 24-bed emergency homeless shelter and cost a total of $4 million.

As part of the deal, the city will contribute $900,000 to the project, in exchange for the first right to buy the property or get the money back if the John Howard Society ever sells the building.

The city also stipulated that if John Howard raises more money and the full $900,000 isn't needed, the difference should be returned to the city.

Council also wanted an agreement showing the relationship between all parties participating in the project and that it be brought back to council for approval at a future date.

Coun. Kate Rogers said she was "uncomfortable" with the resolution.

"What puts me in the most awkward position, though, is to not support this motion implies that I'm not supporting the city providing funds to the project if necessary," she said. "And I clearly am because I voted for that on Monday."

Coun. Eric Megarity said he would have liked to put forward an amendment, but didn't think it would be accepted.

"It's better than zero dollars, not happy with the conditions, but I know the money will flow and that's a good thing. So that's a compromise," he said.

Coun. Dan Keenan, who voted against funding the project on Monday, said he supported the resolution.

"It is an investment, an equity investment in a property that they want to buy with the opportunity for the city to recover that investment at some point in the future ... that gives me a different comfort level than where I was at earlier because I think the city is protected," he said.

Only Deputy Mayor Steven Hicks voted against the resolution.

"It goes back to process and precedent, and we've seen by not having that, what happens, we got a council being torn apart," he said. "We've had councillors walk out of here tonight and we probably shouldn't even be here tonight because we voted on this on Monday."

Councillors John MacDermid and Eric Price weren't present for the meeting. Price recused himself from all discussions because he is a shareholder of the City Motel.

Mayor Mike O'Brien said it was a big step forward for the city.

"It satisfies both of the concerns that I heard: 'How do we make this? How can the city contribute to make this project go forward?' And also, 'How could we protect the investment and the taxpayers that we're comfortable with the city moving into this field at this time?' So that's the uniqueness of this option."

Concerning wording, says John Howard Society

Jason Lejeune, project manager with the John Howard Society, said he's never seen an offer like this. He said some of the wording is concerning.

"I'm not sure what it really means, I'll have to see what [city] staff sent over to us," he said.

Lejeune said that "some of the city's conditions undermine some of the positions of existing funders."

He said the project is in a position to purchase the building, but funding is still needed for renovations.