Markham’s NHL-size arena project losing support
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Markham’s ambitious plan for a $325-million, NHL-size arena faces trouble after Deputy Mayor Jack Heath joined a growing number of councillors opposing the project’s funding formula.
Heath, who has backed the project since its inception more than two years ago, stunned the city on Thursday by announcing council should cancel the arena’s current “financial framework” and not provide any public funding.
“The proposed financial framework has become extremely controversial in our community,” Heath said in a statement. “I believe that discussions on it should be discontinued.
“Many taxpayers are opposed to Markham being involved in any financial aspect of the Markham Sports, Entertainment and Cultural Centre. They see risk and question the need and benefit.”
The plan proposes Markham borrow $325 million, with a private sector partner paying back half the amount over 20 years. The city would raise the other half through development fees on builders and ticket surcharges on arena guests.
Heath, a 15-year council veteran, follows councillors Jim Jones and Joe Li, the city’s biggest opponents of public funding for the project because of the possible risk to taxpayers. The two councillors, who are members of York Regional Council with Heath, have also criticized a lack of transparency in the approval process that has infuriated some taxpayers.
It now appears a majority of the 13-member council opposes the 20,000-seat arena in the city’s new downtown, in the Highway 407-Kennedy Rd. area, without significant change in the funding formula. That is in stark contrast to last April when council voted 11-2 for the financial framework.
Since then, opposition has slowly increased. More than 200 residents attended a public meeting recently where every speaker criticized the city’s financial involvement.
“Things have changed as people have become more informed,” said Councillor Don Hamilton, who also objects to the current plan. “There now appears to be a majority (of council) against it and there could be more. Some other councillors are still on the fence.”
Mayor Frank Scarpitti, who has described the project as “an incredible opportunity” for Markham, said Heath’s shift doesn’t bother him because the financial framework is one of several steps in the process and could need further work.
“We have signed no binding agreements or a memorandum of understanding which includes the financial framework,” Scarpitti noted. “I won’t support any project that is not in the best interests of our city.”
He also stressed that the private sector contribution to the project actually represents about $292 million, including $162.5 million from the Remington Group and another $130 million from other developers who would pay the city in development fees.
“I don’t want to just throw that potential $292 million investment in our community out the window. I want to be sure.”
Heath said the city’s development services committee will discuss the project’s site plan next week where he will push for removal of some provisions with ties to the financial framework.
“In my opinion, the financial framework should be cancelled,” he added. “But with a few tweaks here and there, the site plan is acceptable.”
Heath said he initially supported the project because of the impression it would attract an NHL team, but there is no indication a franchise will come.
“I’m not interested in being involved in minor league sports,” he said.
Project promoter Graeme Roustan, president of GTA Sports and Entertainment, has said the arena does not need an NHL franchise to be viable. But most industry experts have told the Star it would be impossible for the arena to avoid red ink without a major professional tenant.