Flames pres­i­dent says team is be­com­ing a have-not market

Truro Daily News - - SPORTS -

The pres­i­dent of the Cal­gary Flames says the team is not swim­ming in money.

Ken King told Cal­gary’s cham­ber of com­merce the team has gone from a giver to a taker in NHL rev­enue shar­ing.

“We’ve gone from a top-10 rev­enue con­tribut­ing team, where we wrote the cheques in the last few years to help the other teams, and we have now crossed the line,” King said. “We’re now re­ceivers. We’ll get a cheque this year.

“Isn’t that ridicu­lous in this beau­ti­ful market? It shows where this is head­ing and it’s in the wrong di­rec­tion.

“I can say sadly we have crossed one of the reme­dies off the list and that is the new fa­cil­ity. I hon­estly do not know where that part of the story is go­ing to end.”

Un­der NHL rev­enue shar­ing, the league’s rich­est teams give up a por­tion of their rev­enue to help lower-gross­ing clubs pay play­ers.

With the Oct. 16 civic elec­tion as a back­drop, the city and Cal­gary Sports and En­ter­tain­ment have each gone public with what they are will­ing to pay and what they think the other side should pay for a new NHL build­ing.

King de­clared ear­lier this month on be­half of Flames own­ers Mur­ray Ed­wards, Alvin Libin, Clay­ton Rid­dell, Al­lan Markin and Jeff McCaig that they were halt­ing ne­go­ti­a­tions with the city be­cause talks were “spec­tac­u­larly un­pro­duc­tive.”

Their po­si­tion is the team will con­tinue to op­er­ate out of the 34-year-old Sad­dle­dome “for as long as we believe it is fea­si­ble.”

While King de­clared dur­ing the ques­tion-and-an­swer ses­sion “the file is closed” on more arena talk, he used his plat­form to talk about the eco­nomic chal­lenges the Flames face in a Canadian market con­sid­ered fool­proof for an NHL team. The Flames reg­u­larly sell out the Sad­dle­dome, which seats 19,289.

“When peo­ple are telling you ‘this is a great market’ and it is, it’s a min­i­mal market,” he said. “It’s on the mar­gins when it comes to the num­ber of peo­ple you need.”

CSEC said it would have put $275 mil­lion of own­ers’ money into a $500-mil­lion build­ing and that 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.

The city pro­posed a three-way split on the cost of a $555-mil­lion 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.

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.

When asked to ex­plain how ticket sur­charge rev­enue counts as Flames rev­enue to­ward arena costs, King said “I could, but I’m not go­ing to.”

CSEC owns the Canadian Foot­ball League’s Stam­ped­ers, Western Hockey League’s Hit­men and Na­tional Lacrosse League’s Rough­necks in ad­di­tion to the NHL’s Flames.

The Amer­i­can fi­nance mag­a­zine Forbes val­u­ated the worth of the Flames fran­chise at US$410 mil­lion in 2016, which was 16th among its eco­nomic rank­ing of the 30 NHL teams.

CP PHoTo

Cal­gary Flames pres­i­dent and CEO Ken King speaks to the busi­ness com­mu­nity at a Cal­gary Cham­ber of Com­merce lun­cheon re­gard­ing the fu­ture of the NHL team.

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