FGD: a potential arena deal comes to City Hall

Without exaggeration, Monday could be one of the most important days in Calgary Flames franchise history. During Monday’s City Council meeting, council will review a tentative deal with the Flames to construct a new arena. If they like it, things could move ahead pretty rapidly.

Considering this process has been dragging on since 2005, that could be great news… (if the deal isn’t awful for taxpayers).

Council is slated to get a closed door update on the tentative deal around 3:45 p.m. – it’s a really packed agenda which is already scheduled to drag into Tuesday, so that time might bump back a bit. But if everything looks palatable to council, they could vote on it and make some details public.

Here are some questions everyone should be asking when details come out.

This week’s meeting also includes a sure to be fun discussion of how the city’s going to cut $60 million out of their operating budget – in the middle of the operating year – to keep property taxes down (scheduled for Tuesday afternoon). Obviously, anybody impacted by tax hikes or service impacts of the budget cuts – we’ll call them all “citizens of Calgary” would prefer zero public money go to a new arena while the tax system is so nuts.

So between the “Calgary needs to redo its budget mid-year to keep tax hikes down” context and the broader context of how other jurisdictions have funded their arenas recently, the big question is how much money the city is investing. The obvious follow-up question is “What’s the justification for that level of investment?”

For reference, the previous level of public investment in the 2017 version of negotiations was $185 million. The justification for that investment, as it will probably be this time around, is using the arena as a mechanism of attracting outside investment into the Cultural and Entertainment District – the same justification they had for putting public funds into the BMO Centre expansion in the spring.

Back in March, the city approved a plan to fund the four major projects – the BMO Centre expansion, the arena and future plans for the fieldhouse and Arts Common expansion – with $1.5 billion of funding from the city’s cash reserves, grants from other levels of government, and the Rivers District Community Revitalization Levy.

The CRL funds are going towards the BMO Centre expansion, so that begs the question of what funding source the arena funds are coming from. In the 2017 proposal, the funds were coming from leftover money from other infrastructure projects (culled together during the Infrastructure Calgary process). The city declined to detail the funding sources in the spring due to not wanting to impact negotiations with their partners. But now that negotiations are almost done, does that change their stance?

You’re probably familiar with the phrase “the devil’s in the details.” Well, these are the important details.

The Saddledome is currently owned by the city and functionally leased to the Flames (via the Saddledome Foundation) for $1 a year, plus commitments to donate inflation-indexed amounts of money to Hockey Canada, the Parks Foundation and Winsport. If the city continues to own the new building and the Flames operate it, the terms of the lease are hugely important to ensuring that it’s a sustainable piece of public infrastructure.

Considering that we’re likely to see details of a tentative deal, it’s unlikely that these answers are fully known yet.

If council likes what they see and moves ahead, it’s likely that the specifics of the deal will be hammered out and formalized. Back in March, council approved plans to conduct formal public engagement about any arena deal, so that likely follows whenever the deal is sufficiently hammered out.

If the public engagement process doesn’t sufficiently terrify city council, presumably that would be followed by a vote to execute whatever agreements they need to in order to get shovels in the ground. Apparently the public engagement could be pretty brief.

We’ve been hearing about this “future arena” for a decade and a half. When will we finally be able to, y’know, go inside of this thing?

As far as timelines:

So… somewhere between two and three years. Assuming shovels get into the ground in 2021, plan for three years – a potential opening in time for the 2024-25 season – and act surprised if it happens any earlier than that.