Budget overruns mean more borrowing for the Portage Credit Union Centre.

Portage la Prairie city council passed first reading of a bylaw to authorize the borrowing of up to $1.8 million more for Phase 1 of the building, which includes the main arena, aquatic and fitness centres, and banquet rooms.

“Cost estimates for the construction of the project have changed now from $35.7 million to $37 million,” Coun. Dave Quinn read from a Finance, Legislative and Property Committee report. “The city’s share of the project cost has therefore increased from $16 million to $17.3 million.”

The original funding arrangement for the city’s share was $10.1 million of borrowed money and the other $5.9 million coming from the city’s reserves, Quinn continued.

Along with the increases, it was recommended by administration to reduce the strain on the city’s reserves by $400,000. That would make the city’s share of the funding $11.8 million from borrowed money and $5.5 million from reserves.

The proposed borrowing means a borrowing bylaw for the additional debt and an amendment to the 2009 financial plan. A public hearing is required for the amendment and will take place on Nov. 9 at 6 p.m. prior to council’s next meeting.

The borrowing bylaw requires approval from Manitoba’s Municipal Board before it can be given second and third reading.

This pushes the total cost of the entire building, including the Portage Mutual Arena, to just over $41 million.

The city has already used up the original contingency fund for the project, which was $1.75 million, Quinn said, and this additional $1.8 million would act as a second contingency fund.

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