Edmonton councillor: Oilers owner wanted operating cash, tax breaks, casino license, pony

Oh, the Edmonton Oilers arena blowup is turning ugly now. After team owner Daryl Katz declared Monday that he was only asking for $6 million a year in public money for operating expenses and that that would really be him subsidizing the city, not the other way around, city councillor Tony Caterina announced that Katz actually asked for much, much more:

“They don’t want to pay taxes,” he said. “They want help now in operating the arena. They want a guaranteed subsidy. They want the city to be their tenant in a major office building. They want the casino licence.”

These were the requests presented behind closed doors last week in a meeting Caterina said should have been public.

“If everybody knew exactly what these new positions were, I think everyone would have seen it as council saw it, which is very unreasonable.”

Caterina added that the request for a property tax exemption was a “non-starter” because “part of the taxes coming out of that building were going to go toward the [community revitalization levy] to actually pay for it.” And the casino license, he added, is up to the province, not the city.

Since all the negotiations took place behind closed doors, right now we only have Katz’s and Caterina’s word on what was discussed. Even Mayor Stephen Mandel seems confused, last night issuing a statement saying that “I no longer can define what Mr. Katz is asking for or what he’s not asking for,” and calling on the Oilers owner to lay his demands on the table in public.

On top of reporting all this, the Edmonton Journal took it upon itself to fact-check some of Katz’s remarks in his interview with the paper on Monday, to wit:

“I bought the Oilers because EIG (Edmonton Investors Group) was fractured and Edmonton’s ability to keep the team was at risk, OK? Nobody can doubt that. That was only four years ago. EIG knew and I knew that the key to Oilers’ sustainability was a new model and a new arena. I stepped up. Nobody else would, John, OK? I stepped up with two goals: to insure the Oilers’ long-term sustainability in Edmonton and to turn Edmonton’s need for a new arena into something unbelievable for the city. I’ve been at this five years, OK? I spent $200 million on the team, I’ve funded operating losses since, I’ve put $70 million into acquiring land. Nobody can question my good faith or my commitment.”

Except that the Journal notes that far from being “fractured” and desperate to sell, EIG — which was formed to take possession of the Oilers in order to find a local buyer — actually rejected Katz’s initial offers for the team, ultimately selling only when he agreed to pay $200 million, up from his initial offer of $145 million. And along the way, members of the EIG ownership group made a point of questioning Katz’s commitment to putting up his own money for a new arena and to ensuring that the team would stay in Edmonton.

Concludes the Journal: “Do the public record and Daryl Katz’s recollections coincide? Not remotely.” Katz is right about one thing: He did invest $270 million in a hockey team and some land, which is a whole chunk of change. But when you consider that he’s hoping to cash in on almost twice that in public subsidies as a result — in fact, more than twice that, if Caterina’s claims are correct — then it’s tough to exactly see this as altruism.


2 comments on “Edmonton councillor: Oilers owner wanted operating cash, tax breaks, casino license, pony

  1. Wouldn’t it stand to reason that if Edmonton lost the Oilers and there was no chance they’d get another team bequeathed to them by Gary Bettman they’d build something simpler like the MTS Center in Winnipeg and try to break even or eke out a tiny profit that way?

    It’d be nice to have NHL hockey as a major tenant in a new building but I don’t think it’s a be-all, end-all.

    The best part of the Jonathan Willis article is the link to the Forbes estimates that the Oilers made about $48M over the first 3 years of Katz ownership. Proving he’s not a complete sycophant like David “Scoring Chances” Staples…

  2. The problem is the Oilers can’t legitimately cry poor. In spite of of some struggles a decade or more ago, the business side of things is now better than ever for the Oilers. The boxes and seats are all sold out. The Toronto Star had a report a year or so ago that ranked NHL teams by gameday revenue and Edmonton was 7th. Ahead of all american teams except for the Rangers.

    The Winnipeg ownership group had studied Edmonton extensively and it was that model that convinced them Winnipeg would be fine.

    Then there’s the threat of moving the team. All relocation options are less viable than where they are now. The one exception would be southern ontario where territorial rights payments would be prohibitive.

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