WILL TOWN'S FINANCIAL ENDEAVOURS BE RISKS THAT PAY OFF?

OSOYOOS TIMES-January 28, 2009

There's a great deal of risk involved behind two of the Town's recent endeavours which were made public last week.

On Jan. 23 the Town announced that it had not only had wrapped up a $2.03 million land deal, but it was giving $1.04 million back to the developers of the Indigo condominium project, which stalled in the fall because of ongoing economic difficulties in the world.

That's $3.07 million out of the Town's pockets at roughly the same time.

Both endeavours have good intentions behind them.

The Town needed space for some projects it says are much needed, like a new fire hall or police station.

The money that was returned to the developers is meant to help get the project back on track.

At a time, however, when most people, businesses and other governments are starting to hunker down to weather the economic storm, should we really be dishing out millions?

Now to be fair, the land deal was agreed upon in September under a different council and when the financial world seemed a bit brighter.

But wouldn't a wait-and-see approach when it comes to how Osoyoos fares economically in the next few months not have been a wiser way to conduct business?

The very fact that the Town has to, in essence, give the Indigo project a loan is a sign that maybe we should be hanging onto our cash a little tighter since a number of developments here have stalled and there may not be as many coming to our corner of the world to shower us with money in the near future.

As for the Indigo developers, it may come to be that the Town never sees the cash it returned to them.

The agreement is that they have to pay back the money when the project is built.

And if the project is completed but doesn't sell out, or has to be reduced in size, and the developers can't repay the Town, what then?

No one said governance or business didn't involve some risk.

With things the way they are right now, however, playing it cautious seems like the better choice of action.

Let's hope the risk pays off.