A proposed rail project between Calgary and Banff—whose backing by the Invest Alberta Corporation critics described as “a layer cake of conflicts of interest”—is unlikely to get financial support from the provincial government, according to sources contacted by the Progress Report. 

Cabinet recently met to discuss the matter and while they didn’t terminate the deal outright, they placed conditions on government support of the deal that would have made receiving any provincial funds unlikely, according to sources who were granted anonymity to speak candidly. 

This Calgary-Banff rail proposal has been a pet project of Premier Jason Kenney and his close associate David Knight-Legg, who stepped down as CEO of Invest Alberta in June 2021 after serving for less than a year. Kenney’s impending resignation as UCP leader also contributed to the decision to place strong conditions on funding the project. 

The train project did not have wide support in cabinet and sources say concerns were raised over the 50-year duration of the proposed deal, which would have seen the provincial government pay $30 million a year for a total of $1.5 billion. 

A rendering of the proposed Calgary-Banff rail project from Liricon Capital. 

The Canadian Press reported on June 27 that Liricon Capital, the company behind the unsolicited proposal and which is co-owned by Adam and Jan Waterous, has yet to receive a firm yes or no from the provincial government on their funding request. For this reason, Liricon reached out to the federal government asking them to “provide some carrots and sticks” to encourage the use of mass transit in Banff. 

Jan Waterous told CP the government doesn’t need $1.5 billion from the province if Parks Canada adopts policies that would push visitors to use the train, such as increasing the entry fee to Banff National Park for private vehicles or expanding shuttle service between park attractions. 

A ridership study commissioned in part by Liricon and conducted by international transportation company Steer claims the train could carry up to 11 million passengers by 2035—five times more than the company’s initial estimate. 

"We have done as much as we can do. The success of the train at this point really comes down to stakeholder support, and specifically the support of Parks Canada to put these policies in place to support this shift to mass transit,'' Waterous told CP. 

Invest Alberta and the Waterouses didn’t respond to requests for comment. 

A spokesperson for Parks Canada said the agency “is aware of the Calgary-to-Banff rail concept but is not reviewing any formal proposals related to passenger rail in Banff National Park.”

Jan Waterous’ assertion that the project doesn’t need the province’s $1.5 billion investment is inconsistent with previous remarks by Waterous and the company. 

“Virtually all passenger rail projects in North America require a government operating subsidy because their farebox revenue is less than their operating costs. In addition, governments must pay for 100% of capital costs,” she told the Progress Report in January. 

As recently as June 6, Jan Waterous told the Calgary Chamber of Commerce that provincial funding was crucial for the project to move forward. “What we’re saying is, we’ll build the track, we’ll run the train, but we need you—the province of Alberta—to support the mortgage payment on some of the capital for the building of the track,” she said. 

Adam and Jan Waterous would financially benefit from the Calgary-Banff rail project. The pair already own the Banff Train Station and Norquay Ski Resort.

A cabinet briefing note obtained by the Progress Report with a subheading titled “Conflict of Interest Considerations” noted that Adam Waterous sought to establish an eco-transit hub at Banff Station, including a gondola which would connect directly to his ski resort. 

Waterous was a founding director of Invest Alberta, and Invest Alberta has stumped heavily for his rail project. The briefing note that was provided to cabinet also said that Waterous has close personal ties to former Invest Alberta CEO Knight-Legg. The specific nature of those close personal ties was not explained further in the briefing note. 

“There has been trading of favours all along the way, and I include in the favours that the government appointed [Adam Waterous] to the board of Invest Alberta, he has close ties to the former CEO of Invest Alberta and then Invest Alberta promotes his proposal,” said Duff Conacher of Democracy Watch, an advocacy group concerned with government transparency. “That’s a corrupt relationship. For the government to then hand money to this project, that would be a corrupt act.”