The city will be paying back a Lower Mainland-based developer for his contribution to the Boundary Road project.
During Monday night's meeting, city council approved entering into a development works agreement with Henry Rempel, who - as Prince George Global Logistics Park Ltd. - owns the seven properties through which Boundary Road connects Highways 16 and 97.
Rempel put up $6.1 million to help cover the cost of the $28 million project, splitting the municipal portion of the price tag after the federal and provincial governments both kicked in $7.5 million.
The city's portion came from the development cost charge reserve funds.
Rempel's money breaks down to $4.5 million for the roads (including tree removal, gravel base, paving, sidewalks, streetlights, underground power and communication lines), $492,000 for water mains, valves, fire hydrant assemblies and $1.1 million for sanitary mains and manholes.
Similar to a latecomer agreement, which will be in place for 25 years, Rempel will receive $18,900 per hectare in development cost charges paid to the city when building permits are applied for by developers who purchase property from Rempel's 498-hectare holding. Incoming property owners are also charged interest at a rate of three per cent per year from the start date to when they finish their development.
The city will hang on to the remaining development cost charges, as well as a one per cent administrative fee.
The city is also collecting a $10,000 fee for preparing the agreement.
In response to questions from city council, city staff said though the municipality wasn't going to collect the same development cost charges it normally would, it was balancing out.
"The city split the cost, if you will, with the developer at the beginning so the city's getting back its contribution from the development cost charges," said interim public works director Dave Dyer.
"We would have had to come up with another $6 million if the developer had not provided that upfront."
