Edmonton Arena Developments

The Oilers bid for a new, taxpayer subsidized arena in downtown Edmonton appears to be picking up steam.  This week has seen a number of significant events. Yesterday, the point man for the arena project, Oilers president Patrick LaForge, announced that the Oilers ownership (the “Katz Group”) had obtained an option to purchase two parcels of land in downtown Edmonton for an arena.  However, LaForge also hinted that other options to purchase land downtown are also in place, and the site of the arena is not decided.

Today, the Edmonton Journal reports that, according to the Katz Group, the arena project is “underway.” Tempus fugit.  I have a few thoughts about these developments:

  1. Edmonton Mayor Stephen Mandel clearly wants the city to own the arena.  I am just a simple academic, naive in the ways of big bidness and politics, but I am pretty sure that owning the arena implies paying for the arena.  That is a curious position to take given that a recent survey found that a clear majority of Edmontonians were opposed to providing taxpayer money for a new arena.  If Mayor Mandel can gain ownership of the new arena without spending any taxpayer money, I will be the first to publicly congratulate him on that amazing achievement.
  2. The usual economic benefit arguments have finally started to emerge from the pro subsidy crowd.  The initial reports include the claim that “the project could spur a $1-billion downtown redevelopment” and analogies between Nationwide Arena in Columbus, Ohio, and a new arena in Edmonton.  People seeking government subsidies for new sports facilities like to throw around huge round numbers for economic benefits, and a billion bucks fits the bill.  The comparison to Columbus has been made before.  I’m sure we will hear more in the future about a recent economic impact report on Nationwide Arena that was done by some academics at Ohio State University.  A thorough summary of the report can be found here, here and here.  I will have some more to say about this report later this week. Until then, I think that Scott Henning over at the Canadian Taxpayers blog has some excellent comments on this report.
  3. The proposal still contains the possibility that a casino will be part of the development project.  One of the parcels of land in downtown Edmonton that the Katz Group has an option on is the Baccarat Casino site, which lends credence to this claim.  I find this to be one of the most interesting elements of the proposal, because gambling and sport do not mix well in North America.  Yes, I realize that we have Sport Select and other lottery-based sports betting in Canada, and that there were NHL themed lottery games offered here in the past.  But on the other side of the coin, professional sports leagues are fighting any sort of sport-related gambling tooth and nail down in the lower 48.  This part will be interesting.

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