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I voted yes to the Events Centre for multiple reasons. A YES or NO decision for such a large project is not always straight forward. I have received over 1,000 emails to my office from Calgarians telling me why I should vote for or against the proposal. I read, and responded to as many as I could. I am posting this so you can get a sense of where I was at this week with my thinking on the Event Centre, and why I voted yes.

I have been a fiscal hawk on Council since first elected in 2013, and often it was a lonely position to be in. Since the 2017 election, conservatives have a stronger voice on Council now and we are able to make changes on how the City runs. My job was always to be your voice, and when they debate around such a large project was split, I had to make my decision based on solid information, reasoning, and the facts.  

Since being elected, I have always opposed pet projects, or programs, that result in our property taxes unnecessarily going up.  I have also continuously opposed tax increases to cover our ever rising spending. However, the 2019 Event Centre proposal ensured that property taxes would not go up because we have the capital reserves to fund this project. That was the deal clincher for me. If we did not have the means to fund this project, without raising taxes, then I would not have voted yes.  

After careful review of the proposal it is apparent that the Return On Investment (ROI) is positive for the City as this project is a catalyst for other development within Victoria Park, and meets our City’s long-term growth plans. I opposed the 2016 CalgaryNEXT deal because it was a bad deal for Calgary, as it would have cost double the price to taxpayers to accomplish and not meet any planning goals of the City. It was for this reason, handing over this kind of money for an Arena, with no vision, no direction, that I said no in 2016.

My job is about making sure that as a Council we better the lives of every Calgarian and build a city where people can afford to come and call it home. Well planned cities are built by saying no to wasteful spending and yes to the right projects, well thought out ideas, and effective and efficient ways of doing things. This is how you attract people, and investment.

The Event Centre in my eyes, met my criteria: city shaping; in alignment with the Cities long term growth plans; capital funds were available; and taxes would not go up. That is why I voted yes to the Event Centre.

My job as a conservative voice on Council is to defend taxpayers, but also to vote yes when a project, or program, makes sense for our City. It is easy to always say no to everything. But our city still needs to build.

Below is a backgrounder for you with links that have much more detail.

How we got here?

After the 2017 Election, Cllr. Davison and others came together to re-start negotiations on the Event Centre after talks failed over the CalgaryNEXT plan presented to Calgarians from the Calgary Flames in 2016. This started the timeline of bringing all parties together and starting fresh on a deal that works for everyone.

Flash forward to March 2019, where City Council outlined the negotiating terms in March 2019, so Council and City Administration knew what was needed to make this work for Calgarians.

The City appointed a third party to review the negotiations and ensure that the City was getting a good deal. That person was Barry Munro who has an impeccable financial background. His direction from Council was to ensure that Calgary was getting a good deal, and that it was fair to taxpayers. Mr. Munro returned to Council two weeks ago and advised us on all findings and that a deal, subject to Council approval, was tentatively reached.

The City through the CMLC, talked to 6,000 residents on the Rivers District at 18 different community events in 2018. This is a large amount of feedback for a single project. The overall agreement had good governance and was led by a group who has a long history of making smart financial decisions, and had direction by Council to get the best deal possible.

When this group came back to Council and said this deal works for Calgary, and respects taxpayers, I listened.

The Grand Plan for the Area

Victoria Park is going to continue to grow over the next few years. The same way that the East Village has thanks to some foresight by previous Councils. CMLC manages this area and its growth, and has done a tremendous job of building this area to what it is now.

The City is moving towards an even bigger plan that includes the following areas:

  1. The expansion of the BMO Centre, this was approved a few months ago, and is under construction now. This will double the size of space, and put Calgary into a higher tier of Cities that can accommodate large conventions;
  2. The Stampede has their own expansion plans, and with the deal agreed to yesterday will reclaim the land that the Saddledome sits on for their expansion plans. You can look at their vision here;
  3. The Rivers District is south of the train tracks and will surround the new Event Centre area. This will mean high-rise apartments and Main Street style businesses. Similar to the East Village. The bus depot currently occupying the land will also be moved. You can click here for what this will look like here;
  4. The apartment high rises currently along MacLeod Trail/1 St SE will be joined by more in the coming years. There are two high rises going up on 12th Ave currently, and there are proposals for more high rises. You can see some of the plans here.
  5. The City has also agreed to the renovation of the CTrain line that stops to the Stampede Grounds to better integrate it with the grounds; this is under way with construction to start soon. This will serve all Calgarians better. You can see the plan here; and
  6. The Green Line is going to come from the SE and will stop in Ramsay area before coming west into the downtown core, with a stop in the Victoria Park area. The Green Line when done will have 140,000 users a day. Connecting users to the area, and to the Red and Blue Lines.

Can we just keep using the Saddledome?

There has also been a lot of discussion, and emails to my office that the Saddledome should be renovated or is good enough as is. This is not the case. As with any building this old and large, it needs more than a splash of paint.

The Saddledome is city owned so all renovations or structural changes are on the taxpayer’s dime. A report done by the Saddledome Foundation in 2017 looked at what could be done with the Saddledome had the main tenant the Flames left, or if the City did build a new Arena leaving the Saddledome empty, the options were:

  1. Renovate the Saddledome into a recreation centre with soccer fields, ice surfaces and workout facility was estimated for $165M;
  2. Repurposing the building into a convention centre was estimated at $156M;
  3. Transform the stadium into a 6,000-seat facility;
  4. Continuing operations as is, which would be $1M a year; or
  5. Demolishing the Saddledome at $12.5M.

Keep in mind this would be on the City’s dime, with 100% of the cost going to taxpayers.

Flash forward to 2019, and the costs after further review to renovate the Saddledome would total $190M now. Compare this to the agreement for the new Event Centre agreed to last night, where the cost is $275M, and meets the master plan for the entire Victoria Park area and does not increase your taxes. The new plan also means we share in ticket revenues and will earn revenue from property taxes from any new development. Currently we bring in zero revenue and renovating the Saddledome would continue this lack of revenue.

What does the City get out of this?

The City will own the Event Centre completely. The CSEC will however run and pay for the day-to-day operations of the facility. The City will only be responsible for any large changes to the structure itself. If, however something large does occur, like a beam needs to be fixed then the City will discuss with the builder itself.

The City will share in several revenue streams. There will be a $2.5M in the sharing of naming rights, and we will have a 2% cut of all ticket sales up to $3M a year, the tickets sales will total $155.1M in returns over the 35-year deal. This was not on the table in the 2016 proposal.

The City will also gain $19.4M in revenue from the retail property taxes over the 35-year period; there is also other events that will be hosted at the Event Centre over the 35 years the City will earn $9.5M for the City.

Finally, the City will earn $138.7M over the 35 years from the property taxes that will come from all the high rises, and commercial properties that will call the Rivers District home. This gets back to the grand vision of the area. Create the conditions, as the City did in the East Village to attract developers. Already this week we have a hotel interested in building in the area.

There are also, $75M in support to local community sport organizations.

How are we funding this?

The CSEC (Calgary Sports and Entertainment Corporation) will pay $275M towards the Event Centre, and so will the City. The other costs will be $15.4M to demolish the Saddledome when the Event Centre is built.

The City has capital reserves that are for the express use of large infrastructure projects. As you can see in this infographic, that Trevor Tombe used, the City has operational and capital budgets. The capital budget can only be used for projects like the Events Centre.

Your taxes will not go up, as these funds are coming from the Major Projects Capital Reserve. It is a separate piggy bank that was created, and funded over the years for these types of projects. It is the same way that households like mine stash funds away each paycheck for a large purchase.

The Green Line

Some of the feedback is we should fund the Green Line instead. The Green Line already has $1.53B each from all 3 levels of Government totally $4.6B. These funds are already allocated and the Green Line will be built. The City is currently reviewing the entire plan to find savings and to mitigate as many risks as possible. See my recent post yesterday of the latest Green Line update here.

The $60M Elephant in the Room

Others emailed asking why we are funding this and cutting $60M in our budget.

The answer, that was an operation budget cutback. The day-to-day budget is what Council cut, and the funds for the Event Centre came from a capital account set up and funded for large projects.

Council in order to give tax relief to businesses in Calgary, allocated funds to freeze their property taxes to 10% meaning that we had a $60M shortfall. Had we not, many businesses who are struggling would have gone under.

This shortfall had to be made up from budget cuts. The City, under provincial rules must have a balanced budget. The cuts meant every department had to tighten their belts, and unfortunately City staff were let go. This is never easy, and to those that emailed my office saying we should “fire everyone” clearly have never had to tell someone they are let go and the impact on them, their finances, and their family. This is never easy to do. Council’s office budgets were also slashed. No City Department was spared.

The City of Calgary Box Seats

This came up in the news that the City of Calgary has a box in the Saddledome, this is true, and was negotiated long before the 88’ Olympics. The box is used by Councillors, MLAs, and other members for use at Hockey Games. Basically, I am invited to use the box with 12 guests to watch a Game once a year. I often bring community presidents, or community members who have volunteered on an initiative as a thank you to them.

If the host Cllr. wants to bring in food or drinks it is on their expense. Some do charge it to their Ward offices. I have not done this once. I pay for any food, like popcorn, myself. The new Events Centre will no longer have this. In fact, it was never part of the negotiations.

The feedback – what I got

The emails that my office received from residents of Ward 4 was over 1,000 and it was evenly divided on how I should vote. I read as many as I could, and if I did not get back to you, I am sorry. I returned around 600 emails. There just was not enough time. In these moments, where it was an even split, I have to make a choice, and again I looked at the overall picture, the ROI, and believed it was more positive for Calgarians then negative. Thank you to everyone who reached out and gave me their feedback. There was no tax increase with this plan, as the capital funds were there, and the ROI was high for Calgarians.  I chose to vote yes, as the benefits of the plan were there, and this will add to our City for years to come.  

I know that there will be some of you who are not happy with my vote, or Councils decision, but I did not vote yes without reviewing everything, and weighing both sides. I chose yes, as the benefits of the plan were there, and this will add to our City for years to come.  

I am back at the doors this summer, and will be knocking as many doors as I can. If you want to reach my office:

Sean Chu

Sean Chu

Sean Chu arrived in Calgary from Taiwan in 1985 speaking not a word of English, and within 7 years he was a sworn officer with the Calgary Police Service. From that point on Sean worked with the Calgary Police Service as on Officer for 21 years in a number of roles until 2013.

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