This situation seems very similar to the proposal to complete the Burke-Gilman trail here in Seattle. For those who don't know, the BG is an east-west (mostly) trail that runs through Seattle, and as you head east, it connects to other outer areas. Anyway, there's a break is (or was) a break in the trail about a mile long in an industrial area in NW Seattle called Ballard. About a year ago, a proposal was made to complete the trail and eliminate the 'break'. Ballard business interests fought it, arguing it would increase their insurance liability by encouraging more bike traffic. This area is already heavily used by cyclists, so completeing the link, if anything, would make things safer.

Fortunately, the business interests efforts failed, and the trail is being completed (or was recently completed, I haven't been there recently). Canadians have always seemed like good, reasonable people to me , so I'm sure logic will prevail and you'll get your bike lanes.