The Saddledome is shown in Calgary, Alta., Friday, Sept. 15, 2017.A new home for the Calgary Flames will be debated Tuesday in city council chambers. The city and Flames owner Calgary Sports and Entertainment have a tentative agreement to equally split the cost of a $550-million event centre which would replace the 36-year-old Saddledome. CANADIAN PRESS/Jeff McIntosh

The Saddledome is shown in Calgary, Alta., Friday, Sept. 15, 2017.A new home for the Calgary Flames will be debated Tuesday in city council chambers. The city and Flames owner Calgary Sports and Entertainment have a tentative agreement to equally split the cost of a $550-million event centre which would replace the 36-year-old Saddledome. CANADIAN PRESS/Jeff McIntosh

Decision time looms for new Calgary arena and home for NHL’s Flames

The city vows municipal property taxes will not increase to pay for the event centre

A new home for the Calgary Flames will be debated Tuesday in city council chambers.

The city and Flames owner Calgary Sports and Entertainment have a tentative agreement to equally split the cost of a $550-million event centre which would replace the 36-year-old Saddledome.

City councillors can approve the deal, vote it down, or delay by asking for a longer period of analysis and consultation.

Mayor Naheed Nenshi intends to vote in favour of the project, calling it “a good deal for Calgary.”

If approved, the soonest shovels would go in the ground is 2021.

In the agreement unveiled last week, the city says the projected return to Calgarians is $400.3 million over the course of the 35-year agreement with the Flames.

That figure incorporates revenues from ticket sales, a portion of naming rights, retail property taxes in the building, CSEC donations to amateur sports programming and tax generation in the district where it will be built.

But a Calgary economist disputes that figure, saying inflation wasn’t taken into account.

“That number is unquestionably wrong,” University of Calgary associate economics professor Trevor Tombe told The Canadian Press.

“A dollar in 35 years is worth a lot less than a dollar today. Inflation alone eats away half the value of that dollar over the course of three and a half decades.

“They’re not at all incorporating these issues around the time value of money. It is just Finance 101. This is not how you do it.”

He also points out a $47-million net loss on the project wasn’t made public at the news conference last Monday, and that information only came to light when administration was pressed by councillors later that night in chambers.

But a loss of $47 million over 35 years isn’t necessarily a deal-breaker, he said.

“It’s a money loser, but that’s OK,” Tombe said. “We don’t fund the zoo because we think it will make money. We do it for other reasons and there are those non-economic considerations here too.”

The city vows municipal property taxes will not increase to pay for the event centre.

If revenue streams to the city stated in the proposal were eliminated, Tombe says the arena’s cost to the average Calgary homeowner would be $15 per year in perpetuity.

“Personally, I actually come down and say ‘hey, the intangible benefits, redeveloping that area and the arena for Stampede and other community stuff and civic pride’ to me, that’s worth fifteen bucks a year, but individuals will differ,” he said.

“Whether it is a good deal for the city or not, it’s subjective. We should really be talking about the non-economic intangible benefits.

“In order to have that conversation, we need accurate, transparent and digestible costs so we can say ‘OK, are those costs worth it?’”

Talks between the city and the Flames abruptly broke off in 2017 when a new arena became a fractious civic election issue.

CSEC is putting up the same amount of up-front cash it was prepared to give two years ago — $275 million.

One major difference in the current deal is the Flames will not pay property tax as the city proposed two years ago. The city would own the building.

CSEC, which also owns the WHL’s Hitmen, CFL’s Stampeders and NLL’s Roughnecks, initially didn’t want to give the city any ticket revenue.

The corporation has agreed to hand over 2 per cent from every ticket sold to the city as a facility fee, capped at $3 million annually for the first five years and estimated to bring in $155.1 million over 35 years.

All revenues generated by the event centre go to CSEC, minus its commitment to the city and the sharing of parking revenues with the Calgary Stampede board.

The Flames would be responsible for the operation, maintenance and day-to-day repairs of the event centre.

CSEC has committed to upping its contribution to local sport groups, which the city states amounts to $75 million over the course of the 35-year term.

The event centre is part of revitalization plan for the east side of downtown near the Stampede grounds.

Calgary’s mayor acknowledges the optics of committing to a new arena right now are poor in the wake of last week’s $60 million in budget cuts.

“Let’s be real. This timing stinks,” Nenshi wrote Saturday in social-media post.

“It is one hundred per cent reasonable to ask what the heck council is thinking, bringing forward an agreement on a new arena, talking about spending on other projects, all while reducing the budget by $60 million.

“But we have to continue doing our work as a city on multiple fronts. The big picture remains to continue to build a great community while maintaining our position as the best place in Canada to start and grow a business.”

Donna Spencer, The Canadian Press

Just Posted

The City of Red Deer sits at 249 active cases of the virus, after hitting a peak of 565 active cases on Feb. 22. (Black Press file image)
Red Deer down to 119 active COVID-19 cases

Province identifies 179 new cases Saturday

Member Terry Parsons’ custom built track vehicle.
Forestburg’s Area 53 Racetrack gears up for action-packed season

Site will also host a portion of the ‘Miles of Mayhem’ event in July

Sabrina Wilde in front of a recently purchased monster truck. Submitted.
Thorsby business women a finalist for 2021 Alberta Women’s Entrepreneurship Award

Sabrina Wilde with Lone Wolf Mechanical is a finalist for the entrepreneurial award.

Grade 12 students at Wetaskiwin Composite High School took place in the annual water fight off school property on June 11, 2021. Shaela Dansereau/ Pipestone Flyer.
Graduating students in Wetaskiwin throw water fight after being told it could result in suspension

Students were told their participation could result in them being barred from graduation ceremonies.

At an outdoor drive-in convocation ceremony, Mount Royal University bestows an honorary Doctor of Laws on Blackfoot Elder and residential school survivor Clarence Wolfleg in Calgary on Tuesday, June 8, 2021. THE CANADIAN PRESS/Jeff McIntosh
‘You didn’t get the best of me’: Residential school survivor gets honorary doctorate

Clarence Wolfleg receives honorary doctorate from Mount Royal University, the highest honour the school gives out

Flowers and cards are left at a makeshift memorial at a monument outside the former Kamloops Indian Residential School to honour the 215 children whose remains are believed to have been discovered buried near the city in Kamloops, B.C., on Monday, May 31, 2021. THE CANADIAN PRESS/Darryl Dyck
‘Pick a Sunday:’ Indigenous leaders ask Catholics to stay home, push for apology

Indigenous leaders are calling on Catholics to stand in solidarity with residential school survivors by not attending church services

“They will never be forgotten, every child matters,” says Sioux Valley Chief Jennifer Bone in a video statement June 1. (Screen grab)
104 ‘potential graves’ detected at site of former residential school in Manitoba

Sioux Valley Dakota Nation working to identify, repatriate students buried near former Brandon residential school

Denmark’s Christian Eriksen receives medical attention after collapsing during the Euro 2020 soccer championship group B match between Denmark and Finland at Parken stadium in Copenhagen, Saturday, June 12, 2021. (AP Photo/Martin Meissner, Pool)
Christian Eriksen in stable condition, Euro 2020 match resumes

Eriksen was given chest compressions after collapsing on the field during a European Championship

As stories of the horrors of residential schools circulate after the Tk’emlups te Secwepemc First Nation announced it had located what are believed to be the remains of 215 children, Grand Chief Stewart Phillip of the Union of B.C. Indian Chiefs said he feels a connection with the former students. THE CANADIAN PRESS/Darryl Dyck
2 sides of the same coin: Ex-foster kids identify with residential school survivors

Grand Chief Stewart Phillip says the child welfare system takes Indigenous children from their families

Airport ground crew offload a plane carrying just under 300,000 doses of the single-shot Johnson & Johnson COVID-19 vaccine which is developed by the Janssen Pharmaceutical Companies at Pearson International Airport during the COVID-19 pandemic in Toronto on Wednesday, April 28, 2021. THE CANADIAN PRESS/Nathan Denette
1st batch of Johnson & Johnson vaccines won’t be released in Canada over quality concerns

The vaccines were quarantined in April before they were distributed to provinces

The arrest south of Winnipeg occurred before Bernier was to arrive at a protest in the city. (Twitter/Maxime Bernier)
Maxime Bernier arrested following anti-rules rallies in Manitoba: RCMP

He’s been charged with exceeding public gathering limits and violating Manitoba’s requirement to self-isolate

Prime Minister Justin Trudeau arrives for the G7 Summit, at the airport in Newquay, United Kingdom, Thursday, June 10, 2021. THE CANADIAN PRESS/Adrian Wyld
Details on Canada’s vaccine sharing plan coming Sunday, up to 100 million doses

Canada’s high commissioner to the UK says details will come after the G7 summit

Most Read