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New arena deal fair for city, on to next steps

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  • New arena deal fair for city, on to next steps

    Plans to build a new arena in downtown Edmonton have taken a significant step forward with City Council’s approval of an agreement framework between the City and the Katz Group. The framework outlines the principles both parties will use to finalize the terms of a master agreement.

    Council has given City administration the mandate to work with the Katz Group and other stakeholders to make the downtown arena become a reality. The framework agreement addresses the funding, design, building and operation of the arena.

    We believe the agreement is a fair deal for Edmonton and for the Katz Group. It responds to the key points we heard from Edmontonians in our consultation last year:
    • it minimizes the City’s risk,
    • it ensures no current tax dollars will go to the project and,
    • it keeps the Oilers in Edmonton for 35 years.


    The City’s $125 million contribution to the construction costs of an arena will be generated in part through a Community Revitalization Levy ($45 million) while the remaining $80 million will come from sources such as new parking revenue, tax revenue from the arena, and redirected City subsidies.

    Edmontonians told us users of the facility should pay for part of the new building so a user-pay Facility Improvement Fee will raise $125 million to put towards design and construction. And the $100 million contribution of the Katz Group is confirmed.

    Having this agreement in place now enables both parties to pursue funding from other levels of government to make up the $100 million shortfall in the $450 million maximum price that has been set for the arena.

    The framework agreement also states clearly that the City will own the land and building and the Katz Group will be responsible for operations including all operating costs and the costs of all capital upgrades, maintenance and improvements. In return they will receive all operating revenues, including naming rights and parking revenues. That’s a deal that we believe helps mitigate the City’s risks.

    The design of the new arena is critical to the revitalization of the downtown area. The agreement spells out that any design must be acceptable to both parties. The City will ensure that there is public input into the design. From our perspective, the arena design must support the Capital City Downtown Plan, integrate into the surrounding community and contribute to downtown revitalization.

    The framework also reaffirms that a community benefit agreement will be a key component of the master agreement and includes conditions such as a requirement for access to the building each year to stage large community events such as Capital EX or the Canadian Finals Rodeo. It also references the redevelopment of the entertainment district area around the arena, a critical piece of revitalizing this part of our city.

    We believe that this project, if done right, has tremendous potential to contribute to revitalization of our downtown.

    Much work remains to be done before the first shovel hits the ground, but both partners are committed to working together. Next steps will be to secure the additional $100 million, finalize a master agreement, clearly define the CRL boundary, and define a process to engage Edmontonians in the design of the arena.

    This is another step forward for our community that will complement efforts already underway to enhance the vibrant, dynamic and appealing downtown that Edmontonians want.

    To stay informed as this project progresses visit www.edmonton.ca/downtownarena.




    • GranaryMan
      #3
      GranaryMan commented
      Editing a comment
      Build an aquarium instead...with great white sharks!!

    • Gord Lacey
      #4
      Gord Lacey commented
      Editing a comment
      I'm not sure how an arena and aquarium are close to being the same thing, besides starting with the same letter of the alphabet.

    • GranaryMan
      #5
      GranaryMan commented
      Editing a comment
      Would this not be an acceptable deal??

      Edmonton pays Mr. Katz the requested amount of money every year. However put a claus on the contract where as soon as the province has approved the casino license for the Katz Group the City of Edmonton ceases the payments to Mr. Katz.

      In exchange for Edmonton giving Mr. Katz the extra money he wants every year he brings all the office jobs that Rexall currently has in Toronto to Edmonton.

      Not only would that bring in extra tax revenue (from all the employees relocating to edmonton) to help offset the money we would be giving Mr. Katz, but there would be another corportate head office in Edmonton. As well, he could fill his new office tower without the City of Edmonton being a tenant, so it would kind of be "two birds one stone".

      It would prove to Edmontonians that Mr. Katz is sincere when he says he wants Edmonton to succeed and that he wants the Oilers to stay in Edmonton.
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