After months of public jostling on the issue, the news from downtown came fast and furious, and seemingly out of nowhere, late on Wednesday night.
Not long after the Vancouver Canucks beat the San Jose Sharks 7-3 in game two of the NHL’s Western Conference Final, proponents of a new downtown arena project pulled out a big 8-5 win at City Hall. That meant that the city had come to an agreement with the Katz Group on a framework for the proposed new home of the Edmonton Oilers.
The two sides have been trying to come together on a plan to replace the aging Rexall Place for a while now, with the idea being that a new rink will help to pump some life into the downtown. The news comes over a month after the city said it was ready to start negotiating, but both sides are quick to stress that this isn’t a binding agreement of any sort.
So what does it all mean then?
First, let’s take a look at some of the highlights of what was agreed upon: The building will cost $450-million and the city will own the land and the facility, while the Katz Group will operate it and will be responsible for upkeep, upgrades and operational costs. They’ll pocket the profits, but they’ll also be on the hook for the expenses.
Speaking of costs, if you’re wondering where that $450-million will be coming from, here’s the breakdown: The Katz Group will put up $100-million, the city will contribute $125-million, and a further $125-million will be raised through a ticket tax.
Wait, that’s only $350-million!
Yeah, about that, the city is hoping the other levels of government will help bridge the gap, though there haven’t been any formal talks just yet. Mayor Stephen Mandel told reporters on Wednesday that his first stop is the provincial government:
“I’ll go to the other orders of government, in particular, the province and talk to them. This arena, this facility, this NHL team, is not an Edmonton private property. It’s the property of northern Alberta. People come here from all across northern Alberta to go to [Oilers] games, they come to Edmonton to go to concerts. People from the region [will] use this.”
Katz Group lawyer John Karvellas called the agreement a “meeting of the minds” and a “very significant event” after all of the effort that both sides have put in since the idea first came about a few years ago. Speaking on behalf of the group, he says it’s a deal that both sides can live with.
Wednesday’s announcement, which will keep the Oilers in Edmonton for 35 years, doesn’t constitute a “Master Agreement,” but there is no question that it is quite a big step in terms of driving towards that goal. Both the Katz Group and the city went into negotiations standing firm on certain things, and both sides made concessions here and there to help get a deal in place.
The next step is to secure that last bit of funding, which they hope to get from the province. Mayor Mandel says he hopes the fact that the city is chipping in with a big portion and the Katz Group is also putting up big money will help their cause.
I suppose another thing that may work in their favor is the fact that the project will likely have a positive spin-off impact on an important part of the city. If the rink was slated to go up in the middle of nowhere or on the outskirts of town, it might be a bit tougher to argue the secondary benefits of it.
For the first time since this process began, we’ve got a solid agreement about how this thing can get done. The ball is now in the provincial government’s court to help with that last piece of the puzzle.
What do you think: Should the province chip in some money to help get this project moving?