No federal money for a stadium

I think the question is do we need a grand lrt as the plans call for.Or can we have something smaller.As for a commision i am not sure if there is enough timne for that at all.What is aslo important to keep in mind if this really it not just about a team but what is best for the city.Aslo landsown is costing about $2 million a year to keep up so something needs to be done.What i think could happen is both groups come to a deal and the city agrees to sell landsdown then melynk will pay for the stadium and the hunt group will pay for the complex.

 

I don't think this is the end.

Firstly, the feds are looking for 'shovel-ready' infrastructure projects and any transit plan in Ottawa going to happen after the recession is long over.

Secondly, there is always money for the right infrastructure projects, even discounting the extra funds currently available in the stimulus package. Toronto had BMO Field built and they got a big transit boost today as well.

Quoting a different story in the Citizen "January’s stimulus-laden budget that is worth an estimated $18 billion to Ontario over two years..." A stadium (or two) for Ottawa would be a drop in the bucket.

Still, it does make the council look like they don't know what they are doing. Just as they get their report on the best locations for stadium (commissioned by the city and looking at 21 locations where no-one wants to put a team), they say there is no money for a stadium.

 

From the Government of Ontario website:

In the summer of 2008, Ontario signed the Building Canada Plan Framework Agreement with the federal government. Under this agreement, Ontario receives $3.09 billion as part of the Building Canada Fund. Ontario’s matching contribution results in a $6 billion investment towards revitalizing the province’s infrastructure.
The Building Canada Fund is divided into two components:

• The Communities Component, where the federal and provincial governments work in partnership with municipalities in communities with 100,000 or fewer residents – each contributing to project funding on a 1/3, 1/3, 1/3 share basis, and;
• The Major Infrastructure Component for larger strategic projects of national and regional significance.

I would see a SSS fitting nicely into the second bullet above. It would certainly be of regional significance.

 

There is one way Eugene Melnyk could seal the deal: offer to pay for the whole stadium. Now that's an offer you can't refuse!

 

I guess that would show how much he wanted soccer in Ottawa!

Of course, Scotiabank Place was privately funded by his predecessors, even down to the highway interchange, but I somehow I don't think it will happen, even if the city donated the land and gave him a 30-year tax holiday on the building.

Maybe if it was tied into the whole development he has planned for the area??

 

It's to be a concert venue too. Are the concerts to be through the city or through Melnyk & co? If it's through the city then it matters who pays for it. Also minor league soccer might affect who pays for it. Melnyk is also looking for some city land so the city will be involved somehow anyway.

I'm not too worried about funding. A lot of it will come from the province.

 

You're an optimist!

I remember reading something from Melnyk about the benefit to the city in the $50-60M range annually and I was going to post that last night, but I wasn't able to find it. You are right about having to sell it to non-sportsfans, and the expected financial benefit is a good place to start. Poeple may not fully believe the figures, but it will certainly help to spell out all the areas where the local economy will benefit.

 

I think that part of what the Hunt group is arguing is that the city is currently wasting money on the upkeep of an under-used Lansdowne Park.

 

The Ottawa Citizen reported on Jan 28:

Leeder said considerable research had gone into evaluating the economic impact an MLS team could have on the community, and suggested it could reach an annual total of between $50 million and $70 million on soccer alone.

He said that did not include other events, including youth tournaments and entertainment.

He also expected the building of the stadium to provide a job boost and said the finished product would generate 500 full- and part-time jobs.

It would be good to see a breakdown of the figures, and obviously the council would want the details, but it sounds like a good investment.

 

From the Ottawa Business Journal, maybe a chance to combine this into the proposed Scotiabank Place development??

News Story
Council approves plans to build $43M Kanata recreation facility
By Peter Kovessy, Ottawa Business Journal Staff
Wed, Feb 25, 2009 12:00 PM EST

The city will enter into a public-private partnership with the YM-YWCA to build a new 80,000 to 90,000-square-foot Kanata North Recreation Complex after council approved preliminary plans Wednesday.

According to a previously distributed timetable, the city will award a contract for an advocate architect in March. A request for proposals for a design-build proponent will be issued in August, with a contract slated to be awarded in February 2010, according to the schedule.

The LEED-gold facility is slated to open in the spring of 2012. The majority of the funds that will be used to build the complex will come from development fees collected from years of growth in Kanata, the city said in a statement.

Although design plans have yet to be finalized, some features include a 25-metre, six-to-eight-lane indoor pool, a large gymnasium, a fitness, weight and cardio room, two full-size sports fields and multi-purpose rental spaces and public meeting rooms, according to the city.

 

The federal minister responsible for handing out money to cities for infrastructure projects says he'll "make sure Ottawa gets its fair share."

But Ottawa won't get any money for an open-air stadium until it asks, said Ottawa West-Nepean MP John Baird, who is the minister of Transport, Infrastructure and Communities.

"I'll put them at the front of the line," he said. "Just come to my office."




http://www.ottawasun.com/News/OttawaAndRegion/2009/02/27/8550456-sun.html

 

That sounds encouraging, if the City can get their act together. I would love to see all the details of the Melnyk plan, but with the little snippets they released, it sounds like an offer the City can't refuse.

The total public funds required are reported to be about $100M and the split is equal between the City, Province and the Feds, so that means about $33M from the City, spread over two years, i.e. around $16-17M a year. Regarding the benefit to the City: "Leeder said considerable research had gone into evaluating the economic impact an MLS team could have on the community, and suggested it could reach an annual total of between $50 million and $70 million on soccer alone."

Obviously the potential benefit figure isn't all cash as there will be plenty of intangibles included, but even if you half the figure, it sounds like a geat deal. If you give me $16M this year and next, I'll give you $30M a year for the next 30 years. Hell, if the benefit figure was 10x inflated and the real figure was $5-7M a year, it would still be a great deal.

Makes me think that there may be a way of structuring these deals so that we can get both. There are enough financial wizards involved if there is a will to get it done.

 

There were two good opinion pieces in the Ottawa Citizen today.

http://www.ottawacitizen.com/Sports/Road+work+wait+stadium+decision/1338820/story.html

http://www.ottawacitizen.com/Sports/Clear+over+stadium+space/1338949/story.html

The columists both seem to have moved ahead of the council in their decision process and there are no more suggestions about MLS and CFL sharing a stadium, just opinions that it is time to look at the individual proposals on their own merits.

The Melnyk bid appears to be much simpler and much better thought out. They know how much it is going to cost and how they are going to get the various levels of government to chip in. Cost $110M, 1/3 each from Feds, Province and City.

The Hunt Group sound very confused. They don't know how much the stadium will cost, Richard Starnes suggested maybe $120-130M when you factor in the city having to pay for underground parking to replace all the spaces that they are going to build on. They note that the city currently pay around $4M a year to maintain the site and they suggest that the city borrow the funds to renovate the stadium, with the loan repayments totalling the same $4M a year. Their claim is that this makes it a neutral cost option for the city - pay the maintenance or pay the interest.

There are three major problems that I see with the Hunt proposal. The first was pointed out by the Randal Denley article - that loan repayment will likely only get you around $55M, nowhere near enough to build the stadium.

The second problem I have is with the claim that it is a cost-neutral solution. It is only cost-neutral if the city were planning on leaving Lansdowne vacant for the next 30 years and so would have had to continue with the maintenance costs. I know that councils can move slowly, but I'm sure that they would have it resolved quicker than that.

Thirdly, it is a terrible option from an ecomomic perpective. Even if you could build a stadium for $55M, why would you want to pay $120M for that stadium when you add the interest charges in ($4M x 30)?

 

The probleam is they have to deal with landsown.Its costing about $2 million a year just to up keep.Then you have the 67s and the geegess football teams does the city help them with new stadiums and arenas,

 

Lansdowne is an asset, and if you don't have to build a stadium there it will be easier to develop. If they don't want the hassle of developing, just sell the whole site to developers.

67's can play at Scotiabank Place, with the curtains blocking off the third level.

Anyone who wants a stadium is welcome to submit an unsolicited proposal to the city (as the Hunt Group and Melnyk did), and these proposals should be looked at on their own merits, just as these two are.

 

The easy decision for the council to make is probably in favour of the CFL.

They can say that they need to do something about Lansdowne and the Hunt proposal is on the only one that addresses that. They can point to the history of Ottawa in the CFL (or they may keep quiet about that) and the fact that there is a conditional CFL franchise already granted. They can point to polls that prefer a stadium downtown and Lansdowne is closer to downtown than Kanata.

But Melnyk knew all of this when he put his bid in, so he must think he has an ace somewhere, otherwise his bid was doomed from the start.

Personally I think his ace is in the numbers. We got a taste of that in the Citizen columns at the weekend. I had a short e-mail discussion with Randal Denley a couple of weeks ago and he seemed very much in favour of Lansdowne Live at that time, but I get the impression he now realises that there are flaws with the Hunt proposal.

When it comes down to it, council will vote for what they think is the best deal for Ottawa, when it is explained to them. I just hope that they don't allow the Hunt group the time to rework their proposal, because any delay would kill MLS for this round, whereas even if it was too late for the CFL to start in 2011, they could delay by a year with no effect. There is no line up of competition for the CFL franchise.

 

CFL group gets a 6 month extension:

http://www.tsn.ca/ctvnews/?id=269587

 

No surprise, but the CFL extended the deadline for the Ottawa conditional franchise today, by 6 months.

http://www.tsn.ca/cfl/story/?id=269587&lid=sublink02&lpos=headlines_main