The City of Red Deer is considering lending $330,000 to Red Deer College for a major road project to improve access into the post-secondary school at 32nd Street.
City council recently gave first reading to a borrowing bylaw so a loan in the amount of $330,000 can be advanced towards the road project underway at the college’s front entrance.
Crews are building two signalized intersections at 32nd Street and 57th Avenue and 32nd Street and 55th Avenue as part of a city and college cost-sharing agreement.
The city is paying $3.9 million towards the project while the college will pay $1,330,000. Under the borrowing bylaw, the college must pay the city the amount no later than the end of September 2011.
“When we went through this whole process, we treated the college like any other developer,” said Mayor Morris Flewwelling on Monday. “We wanted the intersection rearranged and the college wanted this too.”
As part of the agreement, the college received some financial credit for the land that would be used up for the road changes.
The amount the college was required to pay, after land, was $1.33 million.
The city said it could advance the $330,000 so that the project wasn’t tied up.
“Normally, we wouldn’t do this with a private developer. It makes it flow a little more simply,” Flewwelling said. “The debt is really on their books.”
John Chapman, vice-president of college services, said the college paid the $1 million immediately and will pay the remainder at a future date as per the agreement.
The college will get its funding for the project through the province.
“Any business wants to hold onto their cash as long as possible and part with it at the appropriate time,” Chapman said. “The college is treating it as an accounts payable.”
People can object to the borrowing bylaw by submitting a petition with the Legislative and Administrative Services manager within 15 days after the last date that the bylaw is advertised, which is this Friday.