The City has entered into a series of agreements with the Edmonton Arena Corporation (EAC), owned by Daryl Katz, who also owns the Edmonton Oilers, to design, build, and operate Rogers Place.
These agreements achieve the following 4 objectives, which were identified during public consultation:
Protection of the City’s interests
Does not increase current municipal property taxes
Sustains the NHL in Edmonton
Provides public infrastructure as a catalyst for downtown revitalization
Summary of Financial Framework Terms
The total cost of the project will be $613.7-million. The entire project includes the arena, Winter Garden, Downtown Community Arena, LRT connection, pedestrian corridor and the land.
None of the sources of funding for Rogers Place or the associated infrastructure will result in an increase in municipal taxes.
Arena Operations
EAC will operate Rogers Place and pay all operating and maintenance expenses, and will receive all operating revenues, including naming rights and parking revenue.
Through a Council-approved tax agreement, EAC and affiliates will pay the City a maximum of $250,000 in municipal property taxes annually, for EAC arena operations that are open during event hours, and will be responsible for paying all required provincial Education Property Taxes. This tax agreement excludes areas held by third parties, public parking, gambling and restaurants, bars, and other retail and commercial operations operated outside of event hours or open to the general public.
The City will have access to the Arena and Winter Garden for up to 28 days a year, at EAC’s incremental cost. The City’s use will be for community purposes – not for commercial events.
Edmonton Oilers
Sustainability of NHL Hockey in Edmonton is a prime consideration.
A location agreement signed as part of the deal keeps the Edmonton Oilers Hockey Club in Edmonton for 35 years.
The City will enter into a marketing/branding partnership with the Edmonton Oilers to promote the City of Edmonton with the Oilers nationally and internationally at a cost of $2-million annually for 10 years.
Design and costing
The cost of design work is included in the $613.7-million budget for the entire project.
An on-budget Guaranteed Maximum Price (GMP) contract was effective in March 2014. A GMP is a cost-based contract where the contractor is paid a fixed fee subject to a ceiling price. The contractor is responsible for cost overruns.
Land
The City bought the land for the arena project, which is included in the $613.7-million cost for the entire project. The cost of the land was $26.5-million.
Lease
The EAC has first right to negotiate up to three lease extensions for 10 years, and has the first right of refusal on any subsequent lease or land/building sale.
Community Benefits
The Community Benefits will be included within a schedule as part of the Master Agreement, acknowledging the activities of the Oilers Community Foundation.
A Community Advisory Committee meets on a quarterly basis to identify and address community issues.
A senior member of the Oiler’s operations serves on the Community Advisory Committee.
There will be provision for development/facilitation of training or employment for low-income/high-need Edmontonians.
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