City likely on hook for millions in LeBreton cleanup, says Watson

Ottawa taxpayers could be on the hook for as much as $150 million to clean up the contaminated lands at LeBreton Flats through the city's own brownfield grant program.

According to Mayor Jim Watson, the LeBreton lands would be eligible under the city program, which will pay up to 50 per cent of soil remediation costs.

And with estimates for the soil decontamination ranging from $170 to $300 million, the municipal contribution to the clean-up efforts will certainly be in the tens of millions of dollars.

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As the Senators-backed RendezVous Group only found out this week that it ranked above Devcore Canderel DLS — the only other bidder to redevelop LeBreton  —  it has not yet formally approached the city about applying to the brownfield program, said Watson.

"We will sit down with the RendezVous people," said the mayor. "They are fully eligible to apply for that grant program."

The program's rationale is to give incentives to developers to clean up and build on polluted land that would possibly otherwise remain vacant. Once the land is developed, it then generates substantially more property taxes than the original empty land — although developed land usually requires more city services too, like sewers and roads.

'Long-term payoff'

Watson called the brownfield grant program "a short-term investment for a long-term payoff."

"We found in every single case these projects would not go ahead without the brownfield project," Watson said, citing a 2012 grant of $4.5 million to clean up a site at 280-300 Hunt Club Rd., a former petroleum storage site that is now a bustling shopping centre.

Just a few weeks ago, council rubber-stamped a $15-million grant to remediate lands on the former Oblate Lands in Old Ottawa East, currently the site of a major redevelopment.

Not everyone, however, buys the argument that these sorts of developments would never proceed without public money being used for land decontamination.

"I understand that argument in the abstract," said Aaron Wudrick, federal director of the Canadian Taxpayers' Federation.

But he's skeptical that a project as huge as the LeBreton redevelopment wouldn't go ahead with the city's brownfield grant.

'Bit of a stretch'

"The land's a highly desirable property. There was obviously a competitive bid process. There's clearly parties that are interested in developing this property," Wudrick said.

"So to suggest that it wouldn't go ahead with development but for this subsidy, I think, is a bit of a stretch in this particular case."

Ian Lee disagrees.

The associate professor at the Sprott School of Business at Carleton University characterizes himself as a fiscal conservative and has disagreed with Watson in the past.

But this time, Lee is siding with the mayor. He points out that while the LeBreton Flats redevelopment may be a National Capital Commission project, it's the people of Ottawa who will benefit the most from its redevelopment.

"If we want the LeBreton Flats to be developed, I think that's the price we, the people of Ottawa, are going to have to pay," said Lee.

"I am not happy to see the government spending my money. At the same time, LeBreton is a disgrace."