Flames owner proposes $890m hockey-football Frankendome, seeks at least $490m in public cash

Calgary Flames owner CEO Ken King issued his long, long awaited arena plan yesterday, and it’s a doozy: a hockey arena sutured to a football stadium for the CFL’s Stampeders, which would also double as a soccer stadium and “field house” for amateur sports. Total cost: $890 million, of which the public would cover — well, we’ll get to that in a minute. In the meantime, crazy-ass renderings!

calgary_next2A long while back, I started referring to stadium projects with a passel of other things thrown in (mixed-use development! a convention center!) as “kitchen sink projects,” because they include everything including that in an attempt to play hide-the-subsidy in a giant pile of financial paperwork. King’s proposal includes a whopping big kitchen sink in the form of that “fieldhouse,” which allows him to claim that it’s a public benefit, even though the biggest beneficiaries would clearly be the Stampeders, which he just happens to own as well.

As for how the $890 million cost would be paid for, in true kitchen-sink tradition, it’s as confusing as possible:

It’s proposed the $890-million cost would be paid from four sources — a $240-million community revitalization levy, a $250-million ticket tax, $200 million from the city to fund the field house (long a priority on the city’s recreation list) and a $200-million contribution from the Flames’ ownership group.

That “community revitalization levy” would come from kicked-back property taxes, and is effectively the Canadian version of tax increment financing — it’s the same revenue stream the Edmonton Oilers used to raise public money for their arena. Meanwhile, the $200 million for the field house/Stampeders stadium doesn’t appear to have a source attached to it at all, beyond “Hey, you guys said the city needs a field house, you figure out how to pay for it.”

The proposed site for this monstrosity also requires between $50 million and $300 million in cleanup because it was formerly the site of a creosote plant — no, not this kind of plant, this kind — which would be paid for by, um:

King said it will take a group effort to clean up the land and that he wants to get all levels of government involved.

In other words, Not Me.

So that’s somewhere between $490 million and $740 million in public cash, in exchange for which Calgary taxpayers would get to use the football stadium an undetermined number of days a year for an undetermined bunch of sportsy things. King’s announcement came while Mayor Naheed Nenshi was on vacation — what an incredible coincidence! — so it was left to deputy mayor Diane Colley-Urquhart to reply:

“We don’t build great cities by saying, ‘we have no money.’”

Um, you might have wanted to check with your boss before saying that:

Mayor Naheed Nenshi called the proposal “intriguing,” but said challenges exist that must be addressed.

There are very significant requirements for public funding beyond the field house funding, and there is currently no money,” Nenshi, who is on vacation, said in a statement.

Nenshi certainly seemed to leave the door open for discussion, but as he’s also been adamant that he won’t spend public money if there isn’t an equal public benefit — and that $240 million in CRL funding would go straight down a King-sized hole as far as the city is concerned — this still promises to be an epic throwdown. There’s also still lots we don’t know about King’s plan — his snazzy CalgaryNEXT website doesn’t say squat about who would cover maintenance and operations costs, who would get revenues from events like soccer games at the stadium, or all kinds of other important details. Settle down for a long one, because we are almost certainly going to be talking about King’s Frankendome for months if not years to come.


17 comments on “Flames owner proposes $890m hockey-football Frankendome, seeks at least $490m in public cash

  1. The possibility of the two facilities sharing some redundancies, like restrooms, and parking is interesting. And the possibility of the Flames moving some bigger games over to the football side is also interesting. Far more interesting than finding a way to actually pay for it. (or a soccer team capable of filling it.)

  2. Neil, as a fellow resident of NYC do you have any idea where this facility that is “on par with something you would see in New York” is located? In my travels around the five boroughs I can’t say that I’ve seen it. Admittedly I don’t get to the Bronx that often but I’m quite sure it’s not there.

  3. Matt: I assumed that meant “something you would see in a fictionalized version of New York, say in ‘The Avengers.\'”

    Come to think of it, that suggests a funding solution, too: Tony Stark can just pay for it.

  4. It’ll definitely be an interesting issue to follow right up until the next Calgary mayoral elections in 2017. Nenshi decisively won the 2013 election, but the person that’s likely to be his main candidate in 2017 is going to likely run a campaign of “I’m not Nenshi”. I wouldn’t be surprised if this becomes a tipping point and drags out until then. The Flames and Stampeders can’t really fall back on the “we’re going to move elsewhere” since the NHL is going to likely expand to the remaining markets left for the NHL and there’s no other Canadian city capable of hosting a CFL team and American expansion ain’t happening again, so I wouldn’t be surprised if the Calgary Sports and Entertainment Company (led by multi-billionaire N. Murray Edwards) latch on to the new candidate and try to guilt/browbeat Nenshi into submission or run him out of office.
    I lived in Calgary in the past and people want the new arena, stadium, field house and concert venue (especially since their neighbours to the north Edmonton just received their new shiny publicly financed arena), but at the same time the province of Alberta is essentially in a recession after years of being in an economic boom (thanks, oil fields!), so I think the majority don’t want public money going towards this type of project. I’ve read reports that the land cleanup could reach upwards of $1-billion alone and with so much infrastructure repairs or growth needed like roads, mass transit (called the CTrain in Calgary), sewage and water development, etc… to keep up with the growth of the city that if Ken King got his way Calgary would be devastated financially for decades to come. Whatever happens longterm, people can grab their popcorn, pour a nice drink and sit back and watch/read the show that’ll play out in public forums.

  5. I’m from Vancouver so I’m just speculating here, but I’m guessing that the Flames are putting this out there with the intention to just get Calgarians talking about the idea. Because Edmonton and Calgary are huge rivals (not only in hockey – they’re the 2 main cities in Alberta), as Edmonton’s new rink comes closer to being finished, I think people in Calgary will start becoming more amenable to some public funding of the project (jealousy is a huge motivator for most people). And with Calgary getting slapped around by the current tanking of the oil price, you’ll hear more of the “Jobs! Jobs! Jobs!” bs to get people talking about how much it would help revive the economy.

    And if that’s not enough, then you’ll probably hear about one of the Flame’s senior management making a trip or two to Seattle – just for discussions of course, to put more pressure on the mayor.

  6. Is it just me or does this look like an baseball umpire’s check guard. That beings said is a ticket tax really a public contribution? Its more like a user fee than a tax. Plus if the team wasn’t there, there wouldn’t be tickets to tax (I know I know people would do something else with their ticket money and that would be taxed). As far as the community revitalization levy, is it fair to assume that would happen for anyone who built in that spot? If so that’s money the city/province wouldn’t be getting anyway.

  7. Ticket taxes mostly come out of the teams’ pockets (since it means they can’t price tickets as high as they would otherwise without exhausting demand), which is why I didn’t include it as a public cost. Though if it applies to tickets sold for city-run events, then that would be a public cost.

    Do we even know at this point what the CRL district would include? If it’s just the arena and stadium, then we’d need to know if another developer could potentially be found that wouldn’t require it. If it extends to other properties, then all bets are off. (You’d also need to take into account the cost of city services for the arena and stadium — police, fire, traffic — which is what property taxes would normally help pay for.)

  8. I think we need to really know the story with the land they are looking at building on and what other development would happen around it (there would have to be something for the “community revitilization levy” to actually be able to contribute money). If no one else is considering developing the land and it would just lay fallow as a result than the deal becomes harder to argue with because the city would only be giving back revenue that wouldn’t exist anyway.

  9. Do the Saddledome and McMahon Stadium pay property taxes now, anyone know? I’d normally assume not, but this is Canada here.

  10. I pretty sure shadows work the same in the U.S. and Canada. Wouldn’t those slats between each roof panel make a horrendous shadow pattern on the field? I’d hate to be the TV cameraman trying to figure out the right aperture to use on a long pass.

    Also doesn’t even indirect sunlight make it more difficult for ice stay ice? Maybe that part of the stad-rena is completely covered.

    On the plus side it is innovative. I wonder what the equivalent A’s / Raiders Stad-park would look like?

    In the long term, the only hiccup would be is if the Flames and Stampeders ended up owned by different people/corporations. Imagine the same building putting in two bids for each concert? Built-in competitive bidding!

  11. Neil asks “Do we even know at this point what the CRL district would include? If it’s just the arena and stadium, then we’d need to know if another developer could potentially be found that wouldn’t require it.”

    http://calgarynext.com/location.php

    All that wonderful riverfront land on both sides of the stadium, perfect for pricey condos and commercial high rises. It is really a play to have taxpayers clean up and donate the last chunk of riverfront land downtown for 5 billionaires to develop for their profit, oh yes, plus a stadium and an arena, all for $200m.

    http://calgarynext.com/faq.php

    Q: Will there be other commercial developments in the area?
    A: Yes, CalgaryNEXT will stimulate the complete re-development and revitalization of the West Village.

    http://www.calgarymlc.ca/#home-intro

    The city’s own land development corporation – which very successfully implemented the first CRL in Canada for East Village – put out a tender months ago for an environmental consultant to assess the cleanup cost. They would likely get the full mandate to develop the West Village, including cleanup and infrastructure upgrades, which would also be put out to open tender for private developers to build out at market prices.

    God forbid.

  12. Yeah, in case anyone missed it, King confirmed yesterday that he doesn’t just want to get taxes kicked back on the stadium and arena, but on the “office towers and condos” that would be built around them.

    http://www.fieldofschemes.com/2015/08/21/9678/flames-ceo-says-calgary-making-it-hard-on-prophets-no-not-profits-through-radio-so-maybe/

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