A multimillion-dollar improvement project to relieve traffic congestion around one of Red Deer’s busiest intersections will see its price tag climb another $1.6 million after anticipated land sales fell through.
On Monday, council approved a revised budget cost of $15.1 million for the 32nd Street and Gaetz Avenue project, bumping up the original 2008 budget of $13.1 million.
City administration originally tallied the lower amount because they thought some money would be coming from the sale of one part of 51st Avenue. It’s the service road that dissects the Capri Centre parking lot.
“At that time, negotiations with the property owners were very positive and a deal was likely,” said Engineering Services Department manager Frank Colosimo. “The Capri Centre has since changed ownership and the new owners have indicated that they are not interested in purchasing this portion of 51st Avenue at this time.”
The hotel owners may explore this purchase in the future, Colosimo said.
As well, other expected land sales haven’t gone ahead. Other land values have been higher than budgeted.
Since last September, the city has been making improvements to Gaetz Avenue and 32nd Street so the intersection and surrounding area can run more efficiently. It includes road widening, closing most of the service lanes, redesigning accesses to businesses and adding more left-turn lanes.
With a loss of projected land revenues, Colosimo said an additional $1.6 million is needed. The money is now coming from a basic capital grant and a municipal reserve.
Colosimo said there are still outstanding expropriation issues on five parcels required for road widening.
The city has access to the land in question, so the project hasn’t been slowed down. But there are disputes concerning the value of the land, he said.
Colosimo said an outside agency will help decide the actual value of the land as part of the expropriation process.
The city has worked out deals with about five to 10 other landowners, he added.