CalgaryNEXT…What’s Next?

On Tuesday, August 18th Calgary Sports and Entertainment Corporation (CSEC) unveiled a proposal for a new state of the art multi use facility.  This facility would incorporate an arena, a field house and a football field:

The proposal estimates that the new facilities would cost roughly $900 million if built as one complex, and $1.2 billion if built separately.  Here is the funding proposal that was broken down by Ken King from CSEC:

  • $200 million from the ownership group
  • $250 million from a ticket tax
  • $240 million from a Community Revitalization Levy (CRL)
  • $200 million from the City of Calgary to pay for a multi-sport fieldhouse

CalgaryNEXT Financing Model

CalgaryNEXT would be located on the west end of downtown Calgary, an area commonly referred to as the West Village.  This is an area that is currently in desperate need of redevelopment.  The area has a long standing creosote contamination that has yet to be addressed.  Clean up of this contamination could be anywhere from $50M-$300M.  CalgaryNEXT may provide an impetus that may lead to the remediation and development of this land that would otherwise sit unutilized for decades to follow.

Calgary NEXT image

Currently the Calgary Flames play at the Scotiabank Saddledome and the Calgary Stampeders play at McMahon Stadium.  Neither of these buildings are property of CSEC as the Saddledome is property of the City of Calgary and McMahon Stadium is property of the University of Calgary.  CSEC currently pays roughly $5 million in lease and maintenance for the two facilities.  This same arrangement would be in place with CalgaryNEXT.  The City of Calgary would retain ownership of the land and own the facility while collecting a lease from CSEC.

The City of Calgary has already identified a multi-sport fieldhouse as an infrastructure priority.  It is estimated that this project would cost $200 million.  At the time of this blog the fieldhouse project is unfunded.  The fieldhouse would offer substantial public benefit, but the funding commitment could prove challenging with tightening City budgets and other infrastructure priorities.  Regardless if the fieldhouse is built on the proposed CalgaryNEXT site or elsewhere, the price tag has been estimated at $200 million.

There are numerous questions that remained unanswered with the CalgaryNEXT proposal:

  • What will become of the existing facilities that the City of Calgary already owns?
  • If CSEC is no longer the sole tenant of the Saddledome, what is the future of that facility?
  • What will the cost be for the City of Calgary to take over the maintenance duties of the Saddledome and surrounding land?
  • What is the future of McMahon Stadium?
  • If McMahon Stadium is demolished, who will be responsible for those costs?
  • What transportation improvements might be required around the West Village site, and who will bear the burden of these costs?
  • CalgaryNEXT will likely borrow against the $250 million future ticket tax. Who will take on the burden of borrowing the proposed $250 million?
  • Remediation of the West Village site could cost between $50M-$300M. Who will be paying for that?

A project of this scope will require buy in from a large group of stakeholders, and tax payers are very much at the centre of that mix.  If this project is going to be formally presented to Calgarians it is important that they are given a clear picture of ALL public costs associated with this project, direct or otherwise.

I turn the question over to you, what do you think of this proposal?