Calgary Arena Clash

The city of Calgary and the NHL’s Calgary Flames have been publicly squabbling over plans to build a new C$555 million ($455 million) arena, with the city refusing to budge on deal terms and fears of the team leaving town. 

facebook.com/pg/scotiabanksaddledome/ – Scotiabank Saddledome
in Calgary, Alberta.

Calgary Flames President Ken King says the city’s most recent offer to pump in $185 million in cash and benefits to the NHL team is misleading because the hockey team would ultimately have to pay it back.

The city’s offer would leave ownership of the arena and its revenues with the team. The proposal had the city injecting $185 million in cash and other value into the project, the club paying $185 million and a ticket facility surcharge covering the remaining $185 million. The city also agreed to pay the $25 million expenses to demolish the Scotiabank Saddledome where the team currently plays.

But King says under that deal, the city’s portion would be paid back by the team with taxes, an equity share or some other mechanism.

“We’re not only paying for everything but more, given the incremental taxes, so it’s all Flames revenue,” King said at a press conference, according to the Calgary Herald. “If we thought that model would work, we’d save everyone’s time and get on with life.” King added that the ticket surcharge was effectively lost revenue for the team.

Calgary Mayor Naheed Nenshi said the city’s offer was “extremely generous,” according to the paper, and that some would say the city would be giving too much.

“The city somehow needs to share in the upside, if we want to share the costs,” Nenshi said. All but two city councilmembers supported the city deal.

The Flames were to unveil details of its proposal shortly, King said, but didn’t seem hopeful of working with the city.

“Their message is loud and clear; they’re not interested in our deal and we’re not interested in theirs,” the Herald quoted him saying.

King has said the team would prefer to play in the Saddledome than make a bad deal with the city.

However, with the Seattle KeyArena set to get a $600 million revamp and actively seeking a sports tenant, the team could be trying to force Calgary into a sweetheart deal or hometown discount.

Meanwhile, NHL Commissioner Gary Bettman just happened to be visiting Calgary the day King said he was no longer trying to work with the city on an arena deal.

Bettman had a message to Calgary citizens, where Nenshi is up for reelection: “You need to make your voice heard if you think the city is moving in the wrong direction. I don’t get a sense from the city that there’s a commitment to, or a belief in, the importance in having the right infrastructure of having a major league sports team.”

He added: “At some point I envision, without a new building, there will be consequences that everybody’s going to have to deal with.”