Exactly how bad is the new Calgary Flames arena deal?

With all of four days of public comment period (expiring today at noon) allowed before the Calgary city council votes next week on its Flames arena plan, the local media have been commenting like crazy on how it’s either terrific or godawful. Among the takes:

  • Toronto Star columnist says it’s “a pleasant surprise that somebody had actually decided to do something in this gloomy town,” and that despite the fact that the city will get little in the way of ticket taxes and naming-rights money, and Flames owner Murray Edwards could get a huge gift in the form of development rights to public land, it’s a good “compromise” because Calgary “badly needed a win on something, anything, after the debacle that was the bid for the 2026 Winter Olympics.” (Ed. note: The “debacle” was that the Olympics bid didn’t happen because Calgary voters didn’t like it.)
  • Edmonton Journal columnist David Staples says the new deal “appears to be far more favourable to the Flames owners than the arena proposal that broke down in 2017 and also more favourable than the deal Oilers owner Daryl Katz got in Edmonton”: He says Edmonton paid 47% of the Oilers’ arena cost, Calgary would pay 50% of the Flames’, up from 33% in the proposal from two years ago. But he admits that the “details are murky,” and ends up noting that even pro-arena Edmonton officials say it ended up being good to have a lengthy public debate on that city’s plan, though of course their side still won in the end, so they would say that.
  • Calgary Herald columnist Don Braid says that the new arena is good because Taylor Swift and Paul McCartney will be more likely to play there.
  • Macleans writer Jason Markusoff writes that the Flames owners “sweetened the pot” by agreeing to pay a ticket tax, but mostly city officials wanted something they could “claim victory” on: “Nenshi and the council want to remember what victory tastes like and get the public excited about something, even at the risk of getting the public furious anew. After Monday’s presentation, Nenshi gathered King and other principal players in the talks for a handshake photo op, until an aide rushed over and reminded the mayor of the optics of shaking hands on a deal that was just opened to public feedback. Oopsie.
  • Small business owners are mostly mad because the local economy sucks and they’d rather see their own business taxes reduced.
  • Global News contributed a not-very-helpful listicle of costs of recent NHL arenas that didn’t include any details of how much the public paid for each, because that shit is too complicated for a listicle, man, do you know how many posts we have to write today?

So who’s right? As covered here on Tuesday, even with the ticket tax and naming-rights money, the city looks like it would take a rather large loss on its arena spending, while the Flames owners would rake in all the profits (presumably, anyway: the city’s report doesn’t include anything on the team’s side of the finances). That’s true even if you count property taxes on the development around the arena as a net plus — without getting too much into “present value” terminology, suffice to say that so much of the city’s take would be pushed out so many years into the future that it wouldn’t be nearly enough to pay off the debt the city would have to take on right now for arena construction costs. I get a net loss to the city of at least $139 million, counting all the new property taxes as a positive, but not counting costs like land and tax breaks that aren’t specified in any of the documents released so far.

All these known unknowns are why some elected officials — and, presumably, Calgary citizens, though it’s hard to tell since they’ve barely had time to speak up since Monday’s arena announcement, and nobody gives them newspaper columns — have been complaining that four days of public input and then just three more days (two of them on the weekend) to process those comments is less a spirited public debate than a fig leaf over a done deal. City councillor Evan Woolley, whose proposal to push back a council vote to September was rejected by a 9-4 vote, remarked, “I have asked numerous times what the rush is, why one week, and I have not been given a clear answer.”

Pro-arena councillor Jeff Davison, who warned his fellow councillors before the vote on Woolley’s measure that any delay would mean “this deal is done tonight and you will forever be known as the council that likely lost the Calgary Flames” — the deal included a clause that it would be null and void if not approved within a week, presumably exactly so that Davison could pull this two-minute-warning maneuver — claimed that the plan all along was to have only one week of discussion, which his fellow councillors immediately said he was wrong about. But they still voted, 9 out of 13 of them at least, to limit any public debate to less than four days.

And limiting public debate, it appears, is what a majority of the Calgary council did agree on, in part because it’s hard to claim a nine-figure arena subsidy for a sports billionaire as a “victory” if the public gets to disagree with you about that. Back to Cunningham:

Public engagement is great and all that, but sometimes decisions are necessary, even if they cost money and piss some people off.

And the deal will go through, imperfect as it may be. At the end of the day, that’s probably what should happen. After all, some things are more important than politics, fiscal rectitude, or citizen consultation.

Hockey, for example. Not to mention civic pride.

I, for one, eagerly await Gary Bettman’s 2019-20 NHL marketing campaign: Hockey. It’s better than democracy.

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5 comments on “Exactly how bad is the new Calgary Flames arena deal?

  1. Forbes has the 2018 value of The Flames at $450 M and they want a $500 M arena. Go figure

  2. In a way, there’s some small measure of solace knowing that we here in the US aren’t the ONLY dumb-shits stupid enough to give money to billionaires for their latest pet indulgences, though we’ve obviously elevated it three notches above crazy. The old Mencken quote about ‘No one ever went broke underestimating the intelligence of the American public’ is already recognized as a virtual truism and apparently can be applied internationally…

    1. I don’t know that you can draw any conclusions on the intelligence of the Canadian public from this, given that the public has been specifically excluded from having any say in this case.

      1. While I readily admit that it’s ultimately wrong to generalize anything about more than even 2 people, nonetheless I’d be REAL interested to see IF any of the politicians who pushed this through actually suffer at the polls. That’s ultimately the only thing that politicians understand, is their election/re-election. And, as too often has been the case historically, a majority of the ACTUAL voters (NOT potential voters, or polled/surveyed registered voters) will probably casually go-along with the policies, and these politicians know they most likely won’t lose their re-election because people will forget or get distracted/diverted by other issues/non-issues (“who would you rather have a beer with?”). So the politicians make the calculation that they could probably get hurt more at the polls by angry narrow-focus sports fans than by ‘wonky tax nerds’, so they go-along-to-get-along.

  3. Big business and the Canadian version democracy together doing what they do best; if you don’t like it move to Russia. Tacit support of the public by sycophant civic councilors who don’ want to be remembered for ‘costing’ Calgary the Flames as if the team could just pick-up and move next week.

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