After a mere two months in office, Calgary mayor Jyoti Gondek managed to fumble a deal signed over a year ago and in the works for two by angering the Calgary Flames with her radical environmentalist agenda. So now, Calgarians won’t be getting their long-awaited arena.
Calgarians have waited with frustrated patience for nearly a decade to see the Calgary Saddledome replaced with a modern arena to enjoy hockey games, concerts, and other events.
Unfortunately, out-of-control spending from the City, led by Gondek, has made owners of the Calgary Flames walk away from their previous multimillion-dollar investment to see the new Calgary Event Centre built just one month after development permits were granted.
Mayor @JyotiGondek speaking now. She is joined by Councillors @YYCTKW and @RajDhaliwal_YYC. Gondek says the prior to release conditions on the development permit came from the Calgary Planning Commission. #YYC #YYCcc @GlobalCalgary pic.twitter.com/UYLAagOJft
— Adam MacVicar (@AdamMacVicar) December 22, 2021
According to the Calgary Sports and Entertainment Corporation (CSEC), spending has gotten so out of hand that there is now “no viable path to complete the Event Centre Project.”
“CSEC’s primary objective in pursuing the Event Centre Project has been to provide Calgarians a first-class facility with an entertainment experience, not only for hockey, but for other events including concerts, comparable to other major cities,” CSEC said in a statement.
“However, at this point, it is clear that the City and CSEC have been unable to resolve a number of issues relating to the escalating costs of the Project.”
For all of the faults of former mayor Naheed Nenshi’s — and there were many — he was able to secure the deal in July 2019 on behalf of Calgarians. Gondek has ruined it in two months.
As the CSEC explains, the organization initially agreed to fund 50 per cent of the project, with the City coughing up the other half of the cost.
However, over the course of the year — and with Gondek tipping the scales at the end — the City progressively hoisted more of the costs onto the back of the CSEC.
“In July 2021, with these costs increasing to $608.5 million, the City informed CSEC they were not able to fund their 50 per cent share which, under the terms of the Project Framework Agreement, would have resulted in termination at that time,” the CSEC explains.
“Instead, CSEC agreed to fund a disproportionate share ($321 million to City’s $287.5 million) and agreed to accept the risk of reasonable future design and construction cost increases related to the Event Centre in spite of our original 50%/50% agreement.”
Indeed, despite the developing one-sided relationship, the CSEC was still willing to play ball for the sake of Calgarians. That was until Jyoti Gondek added $19 million for her personal climate infrastructure, for which the CSEC would be getting a bill for an additional $10 million.
For her part, Gondek has tried to justify the initial increases and stressed that her climate mitigation infrastructure, specifically climate-friendly roadways and solar panels, were essential, and she can’t imagine why the Calgary Flames wouldn’t want to fund them to the tune of $10 million.
There’s a difference in numbers here. CSEC says there is $15M in additional costs plus $4M for climate mitigation. Mayor Gondek says the road issues were $12.1M and the City of Calgary would cover $6.4M, leaving $9.7M for the Flames to cover. #YYC #YYCcc @GlobalCalgary https://t.co/C4IcYKklCv pic.twitter.com/rO1pRY3EQx
— Adam MacVicar (@AdamMacVicar) December 22, 2021
Solar panels and some other improvements at a cost of $3.7M. https://t.co/XhKFqAiNyB
— Adam MacVicar (@AdamMacVicar) December 22, 2021
“The City came to the table to assist with $6.4m in roadways leaving $9.7m for the Flames. Based on this gap, CSEC informed me they are walking away from our deal,” Gondek wrote on Twitter.
“On a project worth over $650m, to have one party walk away for 1.5% of the value of the deal is staggering.”
1/6 Today, I spoke with Murray Edwards, primary shareholder of Calgary Sports & Entertainment Corp (CSEC), about the future of the Event Centre project.
He informed me of the Flames intention to pull the plug on the Event Centre deal.
Why? Here’s what I know:
— Jyoti Gondek (@JyotiGondek) December 22, 2021
However, she shouldn’t be shocked. Nowhere in the original agreement were obligations to become the personal purse of some radical climate activist who most Calgarians hoped never would see a day in the mayor’s office.
“While CSEC was prepared to move forward in the face of escalating construction costs and assume the unknown future cost risks,” the CSEC continues, “CSEC was not prepared to fund the infrastructure and climate costs that were introduced by the City following our July agreement and were not included in the $608.5 million and are not included in the current cost estimate of $634 million.”
The CSEC concludes their statement by telling Calgarians they are “deeply disappointed with the outcome.”
In a desperate attempt to salvage the deal after public outrage, Gondek now says she is going to beg provincial and federal for $3.8 million in climate mitigation and is disputing the amount that the CSEC claims the City is paying.
