The Yukon government and the City of Whitehorse have agreed to cover the $4-million shortfall in the multiplex bid on a 50-50 basis, the Star has learned.

The Star has also learned Premier Dennis Fentie's Yukon Party government initially insisted the city cover the entire shortfall by coming up with $2 million on its own and borrowing $2 million from his government, interest free.

It was only after an unscheduled meeting of elected representatives and bureaucrats from both sides Friday night that it was agreed the government would contribute $2 million, and the city could contribute $2 million.

Mayor Ernie Bourassa was unavailable for comment this morning. He is in Victoria attending a course on local governance.

He did say last week, however, the city would either have to borrow the money, take it from existing reserves or a combination of both. Either the way, said the mayor, he does not see a need for additional tax increase to cover the $2 million.

City council will hold a special meeting tonight to discuss the awarding of the multiplex contract. Bourassa is expected to participate by telephone.

Ketza Construction of Whitehorse, in partnership with Monad Construction of Burnaby, B.C., submitted the low bid of $29.9 million, less the seven-per-cent GST rebate available for municipalities.

The overall budget for the multiplex has been pegged at $28 million. The construction portion of the project was budgeted at $24.5 million, resulting in a $3.9-million shortfall.

Cabinet spokesman Peter Carr said this morning the government will not comment on Friday's night's meeting until after city council meets tonight.

There was nothing identified in last Thursday's 2004-05 fiscal year budget for additional multiplex funding. The budget was delivered in the legislature by Fentie, who is the Finance minister.

The government has contributed $8 million toward the final stage of the multiplex, which is to be built onto the $12.3-million Whitehorse Lions Aquatic Centre.

The federal government has contributed $20 million for the facility, which is necessary for the city to host the 2007 Canada Winter Games.

Council has until the end of the week to make the award before the price is no longer guaranteed. Suppliers and subcontractors to the Ketza-Monad partnership only provide a 30-day guarantee on their prices, as is standard, council has been told.

Peter Densmore, president of Ketza Construction, said today he hopes to receive a letter of intent following tonight's meeting. Should that occur, work would begin immediately, he said.

Monad Construction is an associate of PCL Construction of Edmonton.