A group of four Okanagan municipalities and two regional districts have decided to move forward with the potential acquisition of the old CN Rail Line between Kelowna and Coldstream using the Canadian Transportation Agency (CTA) discontinuance process.
The move extends the timeline that the group has to negotiate with CN Rail and came just before a 30 day window to negotiate with CN passed on Monday.
“Significant progress has been made in negotiations over the past several months, however there are still a few outstanding issues,” said Doug Gilchrist, divisional director for community planning and real estate for the City of Kelowna who has led the negotiations on behalf of Kelowna, Lake Country, Coldstream and Vernon, as well as the regional districts of Central Okanagan and North Okanagan.
“We have applied to the CTA for a non-binding net salvage value determination to assist in informing the agreements and to extend our negotiation timeline,” he said.
Under a non-binding net salvage value the CTA will determine a market value estimate of the corridor (land and assets) to assist parties in the negotiation. Under this process, the NSV determination is not binding on the purchaser but it would be on CN. Once the determination is made, the process can take several months to complete, said Gilchrist.
“This is a once-in-a-lifetime opportunity to preserve a continuous, regionally-significant corridor with the potential to provide long-term public benefits for the enhancement of the social, environmental and economic benefit of our residents,” he added.
According to the city, funding options are still being explored, including partnerships, grants, municipal reserves or borrowing. Local governments are making every effort to minimize the current tax impact in the interest of securing a land asset that would be valued for generations.
Earlier this week, Kelowna Mayor Walter Gray said the province has given the municipalities “strong verbal commitment” that it will fund one-third of the purchase price based on the amount the local governments say the rail corridor is worth.
The Inter-jurisdictional team is acting as a common voice for local governments to work collaboratively in achieving common goals for the mutual benefit of the valley’s residents.
The parties are hoping to purchase the rail line and turn it into a trail that links Kelowna, Lake Country, Coldstream and Vernon.