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EDITORIAL: Arena challenge remains
Abbotsford’s ill-fated initiative to bring profession hockey to this city is over, to the disappointment of fans, but the relief of many taxpayers.
Five years into the 10-year agreement with the AHL Heat, the contract has been severed with a $5.5-million buyout. That brings the investment of local taxpayers’ money in this deal to nearly $13 million, including the 2013-14 season’s loss which the city is obligated to cover. The city’s contract with the Heat guaranteed the team $5.7 million in an annual supply fee, with any shortfall coming out of the public purse.
Over the first half of that agreement, the Heat saw more than $7 million in deficits, and were on course to rack up another $11 million in red ink over the next five years.
Faced with that prospect, the city negotiated an end to the financial hemorraghing. Make no mistake – the Calgary Flames were not going to pack up their affiliate AHL team without compensation for a half-fulfilled contract.
With the exception of the mayor and one councillor, this is the same council that signed the original Heat deal. Voters have been exceedingly patient, considering that all of those incumbents were re-elected in 2011. Four of the current councillors were part of the civic government that brought the three projects of Plan A into existence in 2009, including the entertainment centre.
Was it wise to build a 7,000-seat arena in Abbotsford? Hindsight strongly suggests no, but the council of the day, and a small majority of voters, believed otherwise. And then came the reality of securing an anchor tenant to fill those seats on a consistent basis. What followed was a highly controversial deal based on dreamy or desperate optimism, in which public money was committed to put a pro hockey team on the ice.
What remains is a top-notch facility, which has drawn world-class shows and performers. However, it now lacks a major tenant, and has a track record of $2-million annual losses, which may increase without the revenue generated by a hockey team. The loan incurred to build it costs $4 million annually to service – over the next 20 years.
Last week, the mayor vowed any new tenant would be revenue-positive, without taxpayer support. Politically, it’s impossible to imagine otherwise. The rest of the “new” plan for the centre, featuring a name change, increased community access, and an openness to any new hockey team overtures, is uninspiring.
The Heat debacle is over – the arena challenge remains.