The Future of the Splash Park

[1] So... what is going on with the Splash Park?

• In 2018, the MTC built a Splash Park – costing $1.8 Million - on City of Calgary (the City) property in the Prestwick Fountain Park.  The $1.8MM came from MTC Membership Fees supplemented by Federal and Provincial grants (of $340,000).

• The 2018 Optional Amenity Agreement (2018 OAA) signed with the City, included the Splash Park, and provided that that upon expiry in February 2023, the Splash Park would transfer to the City if the agreement was not renewed.

• MTC attempted to renew the 2018 OAA prior to its expiry; but the City indicated that they no longer enter into similar agreements and that the Splash Park would need to be a City asset. 

• A new 2023 OAA was signed that covers all park amenities around MTC but does not include the Splash Park.

• For the Splash Park, the City provided MTC with a draft Temporary Use Agreement, which provides

  • that the Splash Park is owned by the City;

  • the City allows the MTC to operate the Splash Park, under the City’s direction and at the MTC’s cost. 

• The MTC Board unanimously rejected the signing of the Temporary Use Agreement:

  • The City’s assumption of ownership of the Splash Park is according to the terms of the 2018 OAA.

  • The City has experience with operating similar Splash Parks in Calgary and would therefore be capable of maintaining it themselves.

  • The Splash Park is not gated, there are no access restrictions that limit access to MTC members.

  • The MTC would not have any effective control over the Splash Park (since any operation would be at the direction of the City) but would be responsible for all of the costs.  Given the limited membership base, signing such an agreement that removes the Splash Park from the MTC’s ownership while encumbering it with all of the costs, for a Splash Park who’s access is not limited to MTC members, would not be in the best interests of the MTC.

 

[2] How can the City do this? Why did we not renew the 2018 OAA Agreement?

• We tried! It was the position of the City that they do not allow the private ownership of such assets on land that is owned by the City.

 

[3] What did you do to try and prevent this situation from happening?

• Quite a few things.  We engaged with:

  • Legal and PR firms to understand our options.

  • Our Ward 12 Councillor Evan Spencer as we negotiated with the City

  • Our MLA Rick McIver, for his advice and counsel.

• In addition:

  • We made the city an offer of $550,000 to purchase the property (which is the land is valued at on City balance sheets) in January 2024.  This was to:

    • Allow us to retain full control of Splash Park. 

    • Ensure that the land remained a park under local resident control through the MTC. 

• The city declined the offer to purchase the land, ultimately with the position that because of the non-surplus status of the land, it was not for sale. It was the position of the board that if we could acquire that property, it would not only protect the control of the Splash Park assets but would also provide future space for other community uses, at a reasonable cost. We have determined that we have now exhausted all reasonable avenues of trying to keep this asset under our control and are essentially out of options.

 

[4] Why did the MTC sign an agreement that allowed for this situation to happen?

• The understanding of the current Board is that a past Board built the Splash Park and signed the 2018 OAA on the belief that the City would allow for renewals with the same terms (ie allowing for private ownership of the Splash Park) in the ordinary course.   They did not foresee that the City would require a revised agreement that would not allow the Splash Park to remain under MTC ownership.

 

[5] How is this going to affect the balance sheet of MTC?

• We expect that we will incur a non-cash loss on the Financial Statements - removing the assets from our books for no consideration. The current net book value of the Splash Park asset under amortization at this time is about $1.4 Million, which means we will be booking a loss in this amount plus any additional funding amounts that are determined to be related to this asset and no longer usable by MTC due to the asset changing hands. We would like to also direct your attention to a note discussing this specific issue that was placed under the Notes to the Financials on page 8 of the 2023 audited financial statements.

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[6] So who is in control of the Splash Park?

• The asset and the property are under full possession and operation of the City of Calgary. We will no longer be funding or supporting the operation of the Splash Park. If you are aware of any issues or have any concerns with the Splash Park either now or in the ongoing future, we would kindly direct you to please contact 311.

 

[7] Is this ultimately a bad thing?

• There are a few schools of thought here. While we are remiss to be relinquishing control of an asset that was constructed using MTC funds, and we are also remiss to no longer be protecting such a valuable asset to our community, there are some benefits to the city controlling the asset. This would include operating costs now coming out of the general taxpayer base, and any future leasehold or capital asset improvements deemed necessary now be borne by the City and not MTC. This would in theory end what has been a situation where the community members have both paid property taxes and have borne the operational costs of the Splash Park. The cost of operating and maintaining the splash park is now shared with the broader community, who have at all times been free to utilize the Splash Park.

• It is also within our generally agreed view that the asset will continue to need maintenance, and it is very likely that those costs will be increasing over time, not declining. We still, as of this moment, have the asset for use by our community, within our community, while no longer bearing the operating or asset improvement costs.

  • The cons; however, means we no longer have control of the asset, nor do we control the operational schedule, and the future existence of the park. While there are no indications that we have seen to indicate its existence is going to be changing any time soon, we also no longer have control of the asset or the property. So we are unable to confirm or protect the existence of the Splash Park. We will continue to advocate for its existence and operations within our community.

• It can be said confidently, that the City does operate many splash parks within the city boundaries very successfully, and at no time has the city indicated to us that the case here will be any different.

 

[8] Does this mean our community fees will be going down?

• The board has voted to maintain 2024-2025 fees at the current level. Council fees have not increased in several years and the inflation in that time has offset the Splash Park operation / maintenance cost that is no longer budgeted. 

• The Board is committed to fiscal / financial prudence.  We are constantly looking for ways in which we can be innovative with

• While we are now moving on from the costs of the Splash Park, we are also looking forward to moving our attention past the great amount of time that has been spent on this issue. Simply put we are looking forward to providing enhanced programming and additional activities utilizing the spaces and assets within our control. As we all know, this has a cost, and we wish to not only maintain, but to continue to increase the level of services and entertainment opportunities that we provide for McKenzie Towne residents. We want to do this, while keeping fees flat, which is definitely a challenge within our inflationary times. But by shedding costs such as the operation of the splash park, we are freeing up these cash flows for other uses.