Ottawa leaves door open to help fund Quebec rink

February 10, 2011

Mayors looking to Ottawa to fund new arenas and stadiums for pro sports teams say they're frustrated and confused by the signals coming from the Harper government as Quebec City confirms plans to build an NHL rink with or without federal cash.

Quebec City Mayor Régis Labeaume confirmed on Thursday the city will split the cost of the $400-million project with the province of Quebec - without a private-sector partner.

The Harper government responded by saying it may still chip in under a policy that would apply to Quebec and the rest of the country. The region's Conservative MPs were not invited to the announcement.

"If the federal government goes and gives some funds to that kind of building, that would be on [the basis of]equality and transparency, and affordable for everyone in the country," said Josée Verner, the federal Intergovernmental Affairs Minister and the cabinet's representative for Quebec City.

With the country heading toward a possible federal election in the spring, Conservative MPs in Eastern Quebec face heightened political pressure to come up with something.

"If they don't, it will be political suicide," said Luc Paradis, president of the Quebec City chamber of commerce.

Yet the decision by Quebec City and the provincial government to exclude the private sector from the construction of the arena complicates an already challenging file for Ottawa. Prime Minister Stephen Harper has repeatedly said Ottawa will finance only projects that include private-sector investment. Ottawa has also urged at least one other city looking to build a pro sports facility - Regina - to seek federal cash through a $2-billion Public Private Partnership (P3) Fund.

The lack of a private partner in the Quebec city construction would make the project an awkward fit for the P3 Fund.

Quebec Premier Jean Charest expressed hope that Ottawa will find money for a national program that would allow the province and Quebec City to reduce their contributions to the arena.

"They have a budget coming up. They may very well choose to do that," Mr. Charest said.

Another option floated this week by some Conservative MPs - allowing municipalities to spend existing transfers of federal gas-tax revenue on sports facilities - is already a non-starter with the mayors of Quebec City, Regina and Edmonton.

"I was shocked actually that even the suggestion would come forward," said Regina mayor Pat Fiacco, who is working with the federal P3 Fund on a $100-million application to help build a $430-million multipurpose domed football stadium for the CFL's Saskatchewan Roughriders. He described the comments from Conservative MPs as confusing.

"I don't think it's right that MPs come forward with these types of balloons that simply make absolutely no sense," he said.

Edmonton mayor Stephen Mandel said his city will likely apply for between $35-million and $50-million from the federal P3 Fund later this year toward a new home for the NHL's Edmonton Oilers.

"It's a bit frustrating," he said of comments from Conservative MPs, including from the Edmonton area, suggesting the gas-tax transfers would be an option. He said that money's already been spent.

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.

Mr. Labeaume said that he told NHL president Gary Bettman on Thursday that the arena is going ahead.

"We have a window of opportunity of only a few months to attract an NHL franchise. It will be gone in a year," Mr. Labeaume said. The mayor's comments are at odds with public statements from Mr. Bettman that the NHL has no plans to expand or relocate.

The city will contribute $187-million to the construction of the arena. Another $13-million will come from a private non-profit organization called J'ai ma place, which is raising money to attract an NHL team.

Even in the worst case scenario - no NHL team and few events - the mayor promised the cost can be covered through savings that include the elimination of 500 city hall positions over six years.

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