Tag Archives: Mayor Stephen Mandel

Who knew? The price of land for new arena more than double of what was predicted!

As highway robberies go, this one surpasses the original deal our city parents agreed to in an attempt to square the circle and revitalize the downtown area. No, the land our city parents purchased won’t cost anywhere in the neighbourhood of $20 to $30 million, as originally mentioned. And please note: even that $10 million discrepancy is money most of us have never seen before (and wont see anytime soon, either).

Now, we find out, the land will cost in the neighbourhood of $75 million, give or take a few million either way once the dust settles.

Not only that: where the amended deal called for a $30 million commitment by the Oilers’ owner to the area development, it turns out that if he decides to buy some of the land back, that amount would count as part of his commitment.

Robert Moylers, the city’s spokesthingie, suggests the additional land purchase will allow the city to control the development that goes in the area in terms of the time, the type, and the form. Gee, one would have thought that’s what development permits were for: tell me what you’re going to build, and if we like it, you’ll get the permit. If we don’t, you won’t.

And even if the Katz group DOES buy back the land it said it was going to buy back (no guarantees there, either), it would still cost you and me a pretty penny to keep the rest: $41 million, give or take a million or two either way, again.

Is THAT the cup of tea even the most ardent supporters of the publicly-funded downtown arena bargained for?

Either our city council is a bunch of rank amateurs whose basic knowledge of economics ranks them close to the primates, or – as some whispers seem to float – not all is well with the entire scenario. Let’s remain optimistic and hope it’s the former rather than the latter. If it is the former, this would call for an immediate recall of the entire council, extraordinary elections, and those should be linked to a referendum with the questions spelt out clearly.

Do you still want to use taxpayers’ money to build an arena, with the cost to the city, and be ready for this, NOT $100 ($125) million, but that amount PLUS interest, and PLUS the cost of the land PLUS interest (and the amounts of interest should be spelt out, too)?

Lest anybody objects to including the interest, here’s a reminder: it’s an amount the city will have to pay as part of its spending, so, might as well include it. Please note: it’s spending, not an investment. Somebody else, not the city, will be reaping the benefits.

As mentioned so many times earlier, this entire plan reeks to high heaven. And, as mentioned so many times earlier, there’s no proof the arena, if and when built, would do squat to stop the bleeding from downtown, turning the trend around and revitalizing the area in the process. What does happen here is that the taxpayers are supposed to carry most of the risks while the Oilers’ owner, even if the downtown revitalization plan flops, will be laughing all the way to the bank: his will be the revenues from everything that takes place under his roof.

On top of all that, we are now the landlords for the Baccarat Casino, an outfit owned by the Burnaby-based company, Gateway Casinos and Entertainment. If that is so, where are the numbers we all have the right to know? Can we see the lease deal so we know exactly how much we are going to pay if we demolish the money-making eyesore and replace it with another money-making machine?

This is irresponsibility at its best.

There are some who maintain that even if the arena deal does NOT go through, it’s fine and dandy for the city to own the land: there will be other developments, and the city will be holding all of the real estate cards.

Perfect rubbish, of course. Civic administration is not, and shouldn’t be, a real estate developer.

Generally speaking, any government’s priorities differ from the priorities dear to entrepreneurs’ hearts. This is not to say which of the two sets of priorities is better. This is to say they are different. Governments have no business making such entrepreneurial decisions as imposing a ticket tax on Northlands patrons just to make the deal fair for another private entrepreneur in whose pockets they are sitting right now. To put it as simply as possible, so that even our city parents understand it: fairness in government has nothing to do with fairness in business. Why not? Simply because business is all about competition. Government isn’t.

Also: Mayor Stephen Mandel intimated not so long ago that if no money for the downtown arena project is forthcoming from the provincial government, he’s got a plan B, presumably to line up private investors. (Let’s hope it’s not to raise our taxes to pay for the shortfall.)

Guess what: if he were to show this unfinished piece of what is supposed to be a business plan to any shrewd entrepreneurs, they would do their due diligence, and once they’re done, they would chase him down their corridors with a whip cracking.

This is not to suggest we should apply such corporal punishment to the guy. This is to suggest we should demand, as mentioned, an immediate recall of the entire council, a new election, and a binding referendum.

If the majority of voters still say they want to proceed, highway robbery notwithstanding, let’s rename this place a City of Masochists.

And remember: this is NOT about shining visions. This is all about a perfect crime. Why fleece us one by one when you can fleece the entire city in one fell swoop?

It sounds like blackmail, it stinks like blackmail: what is it?

Daryl Katz imposes a Halloween deadline for a new arena deal in Edmonton

It’s trick-or-treat, or else?

That’s what it seems to be, according to the news that the city’s favourite son and best-known pharmacist, a.k.a. the Edmonton Oilers owner Daryl Katz, wants to have his deal to get public money to build a new arena for his club signed, sealed and delivered by October 31.

He might have his reasons, and one of them might be perfectly valid: he’s put an option on the land where he would like to build the arena, and it’s going to expire soon.

Now, according to what has become known, council heard Friday a bit of what was going on so far as the negotiations are concerned. That’s fine. So far as it goes.

They heard the most important parts behind closed door. And that makes it no longer fine. It makes it downright disgusting.

And now there have been rumblings council might vote on the issue not really knowing some of the major details. Preposterous or preposterous? Let’s hope it’s both the former and the latter. Keeping this council’s record in mind, one’s not so sure. But they should be made aware that as they debate the Oct. 31 deadline, their reply should be: don’t tell us what we should be voting on and when.

If council requires any reminder, here it is: it is public money you’re talking about, not yours. If you wish to put up the $100 million out of your own pockets, be Mr. Katz’s guests. But if you want to touch taxpayers’ money, you can’t be doing it behind closed doors.

Besides, and in council’s eyes this seems to be a minor detail, the aforementioned millions are not nearly enough. There’s also an estimated $57 to $72 million to buy land for a new LRT station, build the station itself, and, if spirit moves them, a pedway on top of it. Of course, the LRT extension itself will cost a pretty penny too, but that one has been debated in council chambers earlier, in different contexts. Still, in the name of ethics, the LRT extension cost should have become a part of the arena debate, also. If in no other sense, then at least by saying, this project would have to be advanced by so-and-so many years to accommodate the new arena, and that might add so-and-so many of your dollars to the cost.

Oh yes, certainly we’re being assured, council will inform the taxpaying public. When? As soon as it sees fit. That’s not good enough. You’re negotiating with a private concern about public money. Guess what? You will have to keep both the doors, and the books, open throughout.

As mentioned so many times before, public money and private business do not mix. Use your own oil and water example here, if you wish. A government’s role and priorities differ from an entrepreneur’s role and priorities. This is not to say which one is better. This is to say they are – in the most thorough meaning of the word – incompatible. Let’s put it simply: the government goes about re-distributing somebody else’s money, while an entrepreneur goes about making and spending her or his own money.

But, given where we are now, the fact remains: this city’s government has got itself involved in talks that have, thus far, at least, led nowhere. It has not felt an absolute obligation to keep its employers (the taxpayers) informed on each turn and twist of negotiations that deal with a substantial chunk of money. Money that many are convinced can be of more use elsewhere. For that reason alone our city parents should be impeached.

Even if this latest ploy is not an attempt to blackmail city council into submission, and from the outside looking in, it definitely looks, smells and sounds like one, there are several options open to Mr. Katz. If he still persists in his view taxpayers owe him something, then, he should let taxpayers decide whether they wish to honour his demand on their own time. The options on the purchase of the land can be extended, too. No? Well, that’s life. If Mr. Katz still persists his club can’t survive without a new arena, then, he could either interest some other entrepreneurs to join him in the project, or he can proceed down the same path most of us have when we wanted or needed something but couldn’t afford to pay for it in cash. We either had to learn to live without it, or we went to a financial institution to convince it we’re worthy of their credit.

It looks Mr. Katz must be getting the worst public relations advice available. Of course, he might be getting the best advice, but is choosing to ignore it or, even, act against it, but let’s give him the benefit of the doubt. Even if we forget about the pure economic nonsense he is proposing, there is this thing called perception. What do people see, and what do people think about what they see? If Mr. Katz is perceived as a Satan, then, alas, he is one, even if, in his heart of hearts, he was an Archangel.

But we won’t know until council keeps its doors open.

Or, better still, if only it had the guts to say, OK, we’ve wasted enough money on this, let’s turn our attention to something more useful.