It is hoped a motion unanimously passed by North Bay City Council has a significant impact on the finances of the Cassellholme redevelopment project, the City of North Bay and its member municipalities.
Coun. Chris Mayne, who is also the vice-chair of the Cassellholme Board of Directors tabled the motion during Tuesday's regular meeting in an effort to spur Nipissing MPP Vic Fedeli to increase advocacy efforts at the provincial Treasury Board on behalf of the non-profit long-term care home.
Cassellholme is undergoing a redevelopment with an overall cost of $122 million, financed through Infrastructure Ontario with the financial burden borne predominantly by the City of North Bay and with member municipalities paying the remainder. The redevelopment will replace the building, originally constructed in 1961, with a state-of-the-art 264-bed facility with eight new special needs units and 16 beds for Indigenous residents.
See related: Cassellholme redevelopment officially underway
Mayne said the reason for the motion is that Cassellholme has been left out of funding that is being dispensed to for-profit long-term care operators that are poised to build simply because the local redevelopment was already underway before the funding envelope was established. The provincial Construction Funding Subsidy (CFS) from the Ministry of Long-Term Care is "intended to incent new construction and provide financial stability during the recent unexpected construction cost and financing cost increases."
As a result, Mayor Peter Chirico will write to the Ministry of Long-Term Care on behalf of the city and urge that the funding criteria be reconsidered and a new program be created that would include homes under construction such as Cassellholme.
See the full motion here.
"We were very optimistic at Casssellholme that would be sharing in this significant construction funding subsidy, which means a difference of about $1.5 million per year to the municipality," Mayne advised his colleagues. "Effectively, this is adding about $35 million to the member municipalities to pay over the amortization period of the mortgage, which effectively represents health care costs that are being downloaded to the municipality. The province set their funding rates in 2020 and hasn't changed them at all since."
Since the CFS increase in 2020, Mayne said rising construction and borrowing costs have significantly increased the financial costs to the member municipalities.
"It's not fair or reasonable for the province to download these kinds of costs for health care onto municipalities," Mayne stated.
See also: City agrees to 'significant and important step' for Cassellholme project
Coun. Mark King, the current chair of the board seconded the motion and concurred with Mayne's message and stressed that the member municipalities should not be left out of the process. "MPP Fedeli has been advised of this situation and he is very receptive to the discussion and I'm hopeful to see that funding initiative take place. It was always thought this would come up at one time or another, alleviating the heavy financial costs to the surrounding municipalities and the City of North Bay."
Of an expected Cassellholme mortgage payment of $6 million per year, about $2 million is presently financed by CFS funding from Ontario, leaving about $4M in capital levies from the municipalities but with the CFS top-up funding the same $6 million would be paid by about $5 million in provincial funding and $1 million in levies.
According to the motion, "Cassellholme’s borrowing rate at Infrastructure Ontario will not be fixed until construction completion and has increased in the past year by approximately 2 per cent, representing about a $1.5-million annual increase to the municipalities."
The delayed for-profit Sienna Senior Living redevelopment of Waters Edge was eligible for a $31-million CFS grant when announced.
The resolution will be shared with the Ministry of Long-Term Care and Treasury Board with a "request that the application criteria for the CFS top-up of
$35 per bed-day be expanded to include Homes already under construction, including Cassellholme."
As construction launched in late winter 2022, Mayne, then-chair of the board and then-Cassellholme CEO and current Coun. Jamie Lowery expressed their gratitude to Fedeli for working tirelessly with them, and on Cassellholme’s behalf, to keep the project front and centre at Queen’s Park. Now they are asking Fedeli to go to bat for the project again.
"I promised I would make sure this project got the support of the provincial government, the funding it needed, and the necessary approvals to go forward," said Fedeli in March 2022. "I congratulate all the partners involved. Ontario has made a big commitment to this project, this is a great day for everyone in Nipissing."
