Contentious Calgary arena deal enters 3rd day of council debate

CALGARY -

Debate over the proposed new arena deal resumes at Calgary city hall Wednesday afternoon, after it was revealed earlier this week the cost had risen from $550 million to $608 million.

The higher cost is being split by the city and the Calgary Sport and Entertainment Corporation (CSEC), with up to $25 million earmarked for costs overrun, as per the 2019 agreement, but there is still concern around what the city will pay.

The original contract included a 50/50 split of the proposed $550-million cost to replace the aging Saddledome and provide a new home for the Calgary Flames, Hitmen, Roughnecks and touring events and concerts. Now, both sides are committing an additional $12.5 million and anything beyond this will not be pegged to the city.

The new totals are $287.5 million for the city, and $321 million for CSEC, however this doesn't paint the whole picture for taxpayers.

The city is on the hook for up to $10 million for site preparation, including flood mediation, and more than $4.5 million is for utility relocation, and transportation costs which Mayor Naheed Nenshi says will be minor.

Nenshi also says plans were redrawn because the initial design was not considered accessible, there weren't enough women's washrooms, and luxury boxes were disproportionate to regular seating.

"It's kind of like hiring somebody to build a house for you and the project goes over budget, you have to pay even more and you are giving over complete control over what ultimately gets built," said Ward 11 Coun. Jeromy Farkas, who is running for mayor in October.

"You're still on the hook for the money but you have no insurance that what's going to be built is actually going to serve your needs."

The Calgary Municipal Land Corporation is out as project manager as Flames ownership seek one of their choosing.

"I believe our partner is saying, 'we will take on all costs overruns above and beyond anything that's in front of you today,' and remember, there's 12-and-a-half, plus 10, plus 10, plus unnamed operating costs before us today, but they will take on cost overruns for the building," said Ward 3 Coun, Jyoti Gondek, who is also running for mayor.

Debate in council chambers is expected to be heated when it resumes at 1:15 p.m. on Wednesday.