Oilers Expect City To Pick Up Tab On Proposed Downtown Arena

City Of Edmonton Would Pay For Oilers' New C$400M Arena Under New Proposal

Under details of the Oilers' proposed C$1.4B arena project released Tuesday, the City of Edmonton "would pay for" the new C$400M arena, while team Owner Daryl Katz' The Katz Group would invest C$100M in the "accompanying sports and entertainment complex," according to Gordon Kent of the EDMONTON JOURNAL. The Katz Group Exec VP/Sports & Entertainment Bob Black said that the city "could borrow money to build the arena, which it would own, then pay off the loan with a 'community revitalization levy' using property taxes generated by the rest of the development." The proposal "includes shops, restaurants and two office towers linked by a 4,000-square-metre pedestrian bridge" to an arena. The arena area "will include a community rink doubling as Edmonton Oilers practice ice, two hotels, a new casino and new student residences." Katz had "pledged to put" C$100M into the rink, but Black said that Katz "instead wants to invest at least that much into the rest of the project, which would be built with partners."  Edmonton Mayor Stephen Mandel said that the "scheme will require extensive public consultations and evaluation once a formal proposal comes forward." City Council member Kim Krushell "isn't opposed to using a community revitalization levy to fund the project," but "she needs to be sure the taxes will cover the costs." Krushell: "How soon can the rest of it be built that generates the tax revenue that would pay back the [C$400M]? People are concerned about traffic and who pays for it. If those can be addressed, then there probably is support out there" (EDMONTON JOURNAL, 2/10).

PICKING UP THE BILL: Mandel yesterday said that he "still expects the Katz Group to invest in a downtown Oilers arena, not just the accompanying entertainment complex." Mandel: "From what we've been told over a number of years and in an unending number of statements, that's always been our expectation. One would anticipate that that would be part of the package. I think that's something the public would expect." But Black believes that "in the end, the risk for the project must be shared by Katz and other key private and public stakeholders." Black: "I don't think it would be appropriate for Daryl Katz to assume all of the risk for this project. Daryl Katz is prepared to assume a balanced risk" (EDMONTON JOURNAL, 2/11). In Edmonton, Paula Simons writes it is "hard to fathom, and harder to swallow, the raw gall of the Katz proposal." Katz' proposal suggests that Edmonton citizens should "shoulder the up-front costs and gamble that property taxes will rise enough to service, and eventually pay off, the debt." In turn, the Katz Group "keeps, not just all the profits, but total control." Simons: "Only in the world of pro sports could anyone pitch such a scheme. But as long as the unspoken threat of moving the Oilers elsewhere hangs in the air, Katz and Black have emotional and political leverage" (EDMONTON JOURNAL, 2/11).