Not even three weeks after declaring that he’d look for a new source of funding for a Quebec hockey arena, Quebec City Mayor Regis Labeaume announced today that the source would be … himself. Okay, really his city’s and province’s taxpayers. Ladies and gentlemen, your Plan B:
Quebec’s government Thursday announced it would pour $200 million into a new coliseum in Quebec City, whose raison d’etre is drawing back a National Hockey League team, something the NHL has warned is not guaranteed.
It amounts to a near 50-50 financing arrangement with Quebec City for the estimated $400 million venue, placing the burden almost entirely on taxpayers.
“An arena financed with 100 per cent public money is unacceptable,” said Claire Joly, executive director of the Quebec Taxpayers League. “There are a lot of people who want an arena and a hockey team in Quebec City, but not at any price.”
The risk for Quebec City is going up dramatically. It had originally committed $50 million. Now it’s on the hook for $187 million. (A group of citizens has raised $13 million to “reserve” seats in the new venue.)
The federal government hasn’t ruled out chipping in as well, but nobody’s holding their breath that they’ll do so, especially not when the latest idea floated — allowing cities to use existing federal gas-tax payments on arenas — drew jeers from city officials, who rightly point out that allowing them to use money they already have isn’t much of a federal subsidy. Meanwhile, that offer from Quebecor’s Pierre Karl Peladeau to put in “tens of millions of dollars” was apparently rejected, as neither Labeaume nor Quebec Premier Jean Charest said anything about private money.
What they did indicate, though, was that in exchange for paying 100% of the arena costs, the city and province would be looking to get a cut of the vig. From the Globe and Mail:
Future private revenue from the Quebec City arena will be evenly split between the city and the province. This includes the commercial naming rights for the building, marketing revenues, and operating rights. All of this could total several million dollars a year, according to the mayor.
That’s all well and good, and it’s nice to see elected officials putting naming rights money in the “taxpayer” pile instead of letting teams get away with considering it their private stash (something they do even when the building the name is going on is owned by the public). Still, “several million dollars a year” is going to be a drop in the bucket in paying off $400 million in arena bonds, unless 30 counts as “several” in Canada. And that’s even assuming that a team relocating to Quebec — remember, this arena doesn’t have even a glimmer of a tenant yet — agrees to turn over those revenues to its public landlord.
All in all, it’s a stunning amount of money for public officials to commit, especially in a nation which doesn’t have nearly the same history of funneling taxpayer dollars to sports teams as the U.S. And to do it on spec, without a team in place — as I’ve noted before, you might as well stick a “kick me” sign on your back.