Park Avenue Privatization

The city of Prince Rupert is out of the Camping business! The City has signed off on a deal with an out of town buyer called Triple J Management, giving them ownership of the 11 acre parcel of land, for a cost of 775,000 dollars.

Of course this being Podunk, nothing ever goes quite as smoothly as one would hope. The actual cash price was 645,000 dollars paid up front, with the city holding a mortgage for the remaining 130,000 which must be paid back to the city by August of 2007.

The sale has been in the works for over a year and a half, and can trace its genesis back to the days of Victor Kumar, who launched an investigation into the site and decided it was costing the city too much in money and resources. The arrangement reached will help to stem the bleeding from the site, which saw the city lose 100,000 dollars between 2001 and 2003, and should provide tax revenues to the city of 10,000 a year from the new owners.

The new owners will be allowed to subdivide up to two acres of the site, providing they retain at least 75 RV spaces and 15 camping spaces in any revitalization of the site.

The deal reached this week is described as the best deal the city could make for the site located on the north side of Park Avenue. It will be with interest that we watch how the site evolves from its present state, what plans the new owners may have for it (they have been permitted to develop tourist themed plans for the site, but not housing) and how it impacts on the campground’s contribution to the Prince Rupert scene.

The Daily News has the details in its Wednesday edition, for those not near a newsstand or living out of town we provide the Podunkicized version for you below.

CITY GETS SOME ‘GREEN’ FROM CAMPGROUND SALE
Leanne Ritchie
The Daily News
Wednesday, March 1, 2006
Page One

The City will finally fold up its tent when it comes to operating the local campground.

On Monday, council confirmed the municipality has sold the Park Avenue campground to an out-of-town company called Triple J Management Inc. for more than three quarters of a million dollars following a sales process that took over a year and a half.

The city’s only campground is situated on an 11 acre parcel of land on the north side of Park Avenue.

Tom Ireland, the city’s corporate administrator, said the campground sold for $775,000, $35,000 more than the city had said it was seeking last summer. The sale includes a city-held mortgage.

“It was not our first choice. We rather would have sold it and taken cash, however this was the best deal for citizen,” said Prince Rupert Mayor Herb Pond in an interview following this week’s Council meeting.

The buyers paid $645,000 up front and hold a mortgage with the city for the remaining $130,000, which must be paid off in the coming 18 months, by August 2007.

The city is charging 8.5 per cent interest on the mortgage and monthly interest payments must be paid during the summer months.

Ireland said there were several other offers but all the other offers were substantially less and had conditions on them that in some cases the city could not have met.

As part of a covenant on the campground, the new owners must retain at least 75 RV spaces and 15 camping spaces. In the future, they will have the opportunity to subdivide up to two acres of the property as long as they continue to provide the sites laid out in the covenant.

Under the current zoning, Triple J Management also has the opportunity to open tourist related amenities. However, it cannot place housing developments on the property.

Former city administrator Victor Kumar initiated the sale after reviewing the operation and determining it was losing money for the city. “We were unable to run it the way a private business would,” said Pond. Between 2001 and 2003 the city lost around $100,000 by operating the facility, while at the same time receiving a number of requests to improve it.

The sale represents an improvement for the city’s finances, said Pond.

In addition to no longer subsidizing the operation of the campground, Pond said the city will also see tax revenues of around $10,000 a year from the new owners.

Ireland stressed the city does not see the mortgage as a risk because if the new owners default, there are a number of ways in which the city can get its money back.

The city was operating the campground using unionized labour under a collective agreement that exists between the city and CUPE local 105, however Pond said it will not affect the city’s staffing levels because of the seasonal nature of the business.

Under city management, no one was allowed to reside in the campground for more than two weeks. Under new ownership that will be limited to 90 days. However, Pond said the city will continue to monitor the campground to ensure people are not living long-term on the property.

Concerns have been raised in the past that out-of-town fishing guides have been living on site during the entire summer.