Flames’ arena proposal tax tricky: Nenshi
Calgary’s mayor says the Flames’ financial proposal for a new NHL arena places a heavy tax burden on the city.
Calgary Sports and Entertainment (CSEC) and the city have gone public with what they would pay and what they think the other side should pay, in the wake of CSEC pulling the plug on “spectacularly unproductive” negotiations.
The looming civic election Oct. 16 has turned up the temperature on what’s become a public back and forth, even though the Flames insist they’re done talking.
CSEC declared via a press release and newspaper ads Thursday they’d put $275 million of owners’ money into a $500-million building and the city should raise the remaining $225 million through a community revitalization levy.
A CRL allows the city to divert property taxes from new development that would theoretically spring up around a new arena into paying for it.
“That’s tax money. CRL is taxes,” Calgary mayor Naheed Nenshi said Friday at city hall.
“That is straight up property tax from people who are in that neighbourhood. It’s property tax the city wouldn’t otherwise have.
“The Flames would like that property tax to be paid by someone other than them. They are not willing to pay any rent, or property tax or any revenue back to the city in their proposal.”
CSEC contends, however, that their $275 million equates to 35 years worth of rent.
The city proposed a threeway split on the cost of a $555million arena, with the city and the Flames each paying $185 million and the remaining third raised from a surcharge on tickets.
The city said the Flames would control the new arena and receive all revenue from it.
Flames president Ken King insists the city’s offer amounts to the team paying the entire cost, or more, because CSEC considers a ticket surcharge paid by users revenue that belongs to the team and because the city wants CSEC to pay property tax.
CSEC owns the Canadian Football League’s Calgary Stampeders, Western Hockey League’s Hitmen and National Lacrosse League’s Roughnecks in addition to the NHL’s Flames.
The ownership group is comprised of Murray Edwards, Alvin Libin, Clayton Riddell, Allan Markin and Jeff McCaig.
CSEC has said the owners “will strive to operate, as we have for the last 34 years, in the Saddledome for as long as we believe it is feasible.”
Nenshi, who is running for a third term, says the city is willing to keep negotiating with CSEC on a new arena.
“As long as I’m the mayor, we will not leave that table,” he said. “These negotiations are hard. They should be hard. We’re talking about hundreds of millions of dollars.
“I believe, you don’t have a temper tantrum, you don’t run away. You sit down and you figure out the right way to do it. I hope we will be able to continue to do that.”
King is scheduled to speak Monday to Calgary’s chamber of commerce, where he is expected to field more questions about arena negotiations.