City of Calgary, Flames agree to 50-50 split on proposed $550M deal for new arena

The City of Calgary and the ownership group behind the Calgary Flames have agreed to a proposed deal that would see the two organizations split the cost of a $550-million new arena equally.

After nearly three hours behind closed doors Monday, council voted to release details about the project which comes after 14 months of discussion. 

Calgarians will be given just one week to share their views on the deal before council votes on it on next Monday.

"Let's cut to the chase. This is a good deal for Calgary," said Calgary Mayor Naheed Nenshi. "This deal makes sense on its own merits."

Nenshi; Ken King, the head of Calgary Sports and Entertainment Corp. (CSEC); Warren Connel, CEO of the Calgary Exhibition and Stampede Ltd.; and Michael Brown of the Calgary Municipal Land Corporation (CMLC) were scheduled to unveil details to the public in a live news conference at 6 p.m., but didn't take the stage until shortly before 7 p.m. after council's closed session wrapped. 

The proposal, which was forged after years of sometimes contentious talks between the city and the Calgary Flames ownership, concerns a replacement for the aging Scotiabank Saddledome, which opened in 1983. 

The Saddledome will be demolished at the cost of $12.4 million to the city, and the city will also spend $3 million on transaction costs.

The city will own 100 per cent of the new event centre and CSEC will bear 100 per cent of the operating, maintenance and repair costs for the 35-year agreement.

It will be located across two city blocks between 12th and 14th Avenue S.E., between Fifth Street and Olympic Way. The site is currently owned by the Stampede and used for parking and roads.

The event centre will include:

• An arena with up to 19,000 seats.
• Commercial and retail spaces. 
• Possibly a second, smaller arena.

The city said it believes it will bring $400.3 million in returns to the city over 35 years, from property taxes, facility fees, support to local community sports groups and its share of naming rights, and other benefits. 

Michael Brown of the CMLC promised it would be built on time, and on (or under) budget.

A previous deal was rejected in 2017, and the new one was the result of thousands of hours of work, Nenshi said. 

"The challenge always was that it was hard for the city, and for CSEC too if I may, to determine really where the return was. We kind of figured out how to divvy up the costs but there were a number of real open questions … what was critical for me is this deal had to be very clean and very transparent," the mayor said. 

Ken King of CSEC thanked all of the involved parties for their collaboration, and confirmed that the 35-year deal means the Flames won't be going anywhere. 

"There was never any sense of us wanting to be anywhere else You can't make that statement any more boldly than having your owners write a cheque for $275 million," King said.

The public will be given a chance to weigh in on the proposal by emailing, writing in or calling their representatives at city hall, Coun. Jeff Davison told reporters early Monday afternoon.

"After council approves this, we still have significant engagement we'll be doing," he said, adding that shovels won't be in the ground until well into 2021. 

Coun. Jeromy Farkas said he thinks one week won't be sufficient time to allow Calgarians to weigh in.

"There's just not enough time," said Farkas on Monday evening. "We made a promise to Calgarians to engage them and consult them in the terms of the deal and right now, in the middle of the summer, there's not really that possibility. So I think the process is rushed.

"And I think that it's a hard sell when you're going from one meeting where you're potentially cutting fire and police, then jumping in to hundreds of millions of dollars to go to, essentially, a sporting facility." 

Coun. George Chahal says he supported the 2026 bid for the Olympics but says he wants some questions answered on this deal.

"Why now? Why today? And why not later? But our focus does need to be on cuts and the challenges we're facing as a city and we need to look at opportunities to build and grow. We must invest in our city, but we have to have the time to make these informed decisions." 

The tentative deal comes as the city plans to cut $60 million from its operating budget, and is reviewing different service reductions that could be done going forward. 

More than 100 protesters rallied at city hall Monday morning to urge council to reconsider cuts that would impact low-income Calgarians, but the group wasn't allowed to speak.

Those cuts would come from a different part of the budget than the money that would be used for a new arena, and property taxes won't be increased.

"The timing is not ideal. We know there's a lot of things going on with respect to the budget, but when you really look at $60 million worth of cuts, that's really talking about two to three per cent of our operational budget. The sky's not going to fall for two to three per cent," said Davison.

The mayor was more blunt about the situation.

"The optics of this stink. This is really terrible timing. But if the deal is ready to go, I'm not about to hold it back," he said.

City council was still fervently discussing the time frame and details of the deal at 11:30 p.m. Monday, after voting 7-5 to suspend the usual timing rules of debate earlier in the evening.

"I remember the discussion around robust and thorough engagement with this proposal, and this is not that," said Coun. Druh Farrell.

More information about the proposed arena deal, along with a link to submit feedback, can be found on the city's website.