DARYL KATZ SPEAKS ABOUT ARENA

Jason Gregor
September 18 2012 12:04AM

Daryl Katz finally broke his silence, and while he didn't talk to all the media, instead having an arranged chat with Journal writers, John MacKinnon and David Staples, he did give us an insight into what he thinks about the ongoing arena debate.

It is clear he was annoyed at how he was portrayed by some members of city council and media last week and decided to finally speak. I've said all along that he needed to speak to the public. Not every week, not even every month, but a few times a year so Edmontonians might get a better sense of what his goals and aspirations are for the city.

You can read Staples' article here, and MacKinnon's here.

The title of MacKinnon's piece will fire people up before they even read it, which is unfortunate, because no where that I read or heard does Katz make a threat that the Oilers will leave. I honestly believe if this deal falls through then no one on council or in the Katz Group has an idea what happens next. It is an option I hope we don't have to experience.

Katz does bring up a valid point when discussing new facilities in other cities. Only the MLSE was able to successfully build and manage their own rink. Edmonton doesn't have the population or corporate dollars that Toronto has, so should we really expect our city to function the same way.

Keep in mind that in 1989 Toronto built the Skydome with $570-$650 million (depends who you believe) of mostly taxpayers dollars. So while some in Toronto might want to tell you how great it is that MLSE built their own rink, that wasn't always the case. In 1994, the Skydome was sold for a measly $150 million after paying off all of its debt. Yikes.

The only way the arena will work in Edmonton is with a private/public agreement. Like I wrote last week, both sides need one another to make this work.

I doubt Katz' words will change the opinion of those who oppose the arena, but I never expected him to be a magician. Some will never like the deal, so trying to appease them is likely pointless.

I found this excerpt from the Journal's interview rather interesting.

 

Katz said he chose to speak up about stalled negotiations because, “there’s a lot at stake and people in Edmonton need to understand the full picture.” 

 

The picture became more cloudy last week, when the subsidy issue, in particular, rankled and blindsided members of city council.

In October 2011, the Katz Group agreed to make mortgage payments of $5.5 million a year for 35 years to cover Katz’s $100-million share of the arena’s construction cost.

Katz also agreed to pay roughly $10 million a year in operating and maintenance costs. To many, that $6-million ‘offset’ resembles a clawback of the $100 million he originally promised.

“I’d like to clear the air on this issue of an operating subsidy,” Katz said. “Because what has come out of the city over the last several days, to be frank, is unfair, untrue and totally counterproductive if what we’re trying to do is secure the Oilers future in Edmonton and have us participate in the development of a new arena and sports entertainment district.”

Katz said a “mechanism to offset capital and operating costs of the new arena” had been contemplated from the beginning of the four-and-a-half-year negotiations, and should not have been a surprise to city council.

“We don’t care if it’s a casino and gaming initiative, or something else,” Katz explained. “We need a mechanism to offset operating and maintenance costs, just like Pittsburgh and Winnipeg.

“Casino and gaming is just one way and it happens to be used in other markets all over North America.”

Katz reinforced the need for a public-private collaboration to build a new arena, one Edmonton badly needs, one the city would have to fund entirely itself if he and the Oilers were not prepared to invest in the project.

Without the Oilers, Katz said, the city “would have to pay all the capital and operating costs, just like Quebec City will, just like Kansas City, just like Phoenix, just like Seattle, just like Hamilton, and just like other cities that would all like an NHL or an NBA team to subsidize their arenas.

 

 It sounds like something was lost in translation. Was this offer contemplated and never pursued, or did the city follow up on this only to be turned down?

I'd like an answer to that question, and after speaking with both Mayor Mandel and city Manager Simon Farbrother last week, I will reach out to hear their thoughts on the matter.

The most positive thing in the Katz interview was that he expressed some urgency to get the deal done. It has been four years, and it is crunch time. I hope that both sides can get back to the negotiating table and finalize an agreement. It would be incredibly disappointing if after four years of negotiating this deal fell apart.

Both sides need to recognize that some mutual compromise and leadership is needed. I hope we see some leadership from both parties as we near the end of this long negotiation.

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One of Canada's most versatile sports personalities. Jason hosts The Jason Gregor Show, weekdays from 2 to 6 p.m., on TSN 1260, and he writes a column every Monday in the Edmonton Journal. You can follow him on Twitter at twitter.com/JasonGregor
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#51 Reg Dunlop
September 19 2012, 01:10AM
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@Dave

The worst public arena in Canada? Crumbling to the ground? I hereby dub you Dave, king of hyperbole.

The coliseum is 40 years old but it should be treated as a civic treasure, even a national treasure. No other existing, active NHL arena has such a grand history. Is it crumbling? Like a Charley Brown Christmas tree, blowing over in a strong wind? Ya, just like the old Edmonton Gardens. It went from 'crumbling' to 'we can't even demolition this sucker, it's just too solid' very quickly. The coliseum is like a high mileage Toyota, not pretty but still gets you where you want to go; it doesn't have the cache of a new Lexus but it does the exact same job.

Besides, if we as a tax base fund 100,200,300 million or more toward a state of the art arena, who here can confidently say that Katz won't attempt or at least threaten relocation anyway as soon as it suits him. The urban dictionary defines shyster as someone who acts in a disreputable or unscrupulous manner...

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#52 David S
September 19 2012, 01:22AM
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Spydyr wrote:

Why did Katz pick Staples.Did Staples send up the bat signal?

Or is it because Staples is one of the biggest supporters of the arena deal.

The former I do believe.

I did not take the time to listen to the recorded interview but I'm guessing none of the hard questions were asked.

Propaganda.

I took the time to listen to that interview. In fact, many hard questions were asked. Too bad you were busy with more important stuff. Although not busy enough apparently to stop you from dropping by and offering up yet another scintillating arena hater comment.

You guys are jealous of Katz. Fine. You want everything for nothing. Fine. You don't believe you need to spend money to make money. Fine. You think the existing arena is plenty good enough. Laughable, but fine. You won't watch any games at the new arena, nor have a meal or drink or see a movie in the new sports and entertainment district. Unlikely, but fine.

But you may want to at least listen to what the man has to say before chirping. Just sayin'.

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#53 David S
September 19 2012, 01:29AM
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Reg Dunlop wrote:

The worst public arena in Canada? Crumbling to the ground? I hereby dub you Dave, king of hyperbole.

The coliseum is 40 years old but it should be treated as a civic treasure, even a national treasure. No other existing, active NHL arena has such a grand history. Is it crumbling? Like a Charley Brown Christmas tree, blowing over in a strong wind? Ya, just like the old Edmonton Gardens. It went from 'crumbling' to 'we can't even demolition this sucker, it's just too solid' very quickly. The coliseum is like a high mileage Toyota, not pretty but still gets you where you want to go; it doesn't have the cache of a new Lexus but it does the exact same job.

Besides, if we as a tax base fund 100,200,300 million or more toward a state of the art arena, who here can confidently say that Katz won't attempt or at least threaten relocation anyway as soon as it suits him. The urban dictionary defines shyster as someone who acts in a disreputable or unscrupulous manner...

I was in the arena last week to start the process for upgrading our corporate suite. Many suite lessees have done/are doing the same. Alot of them are crapshacks.

The building IS crumbling. If you saw it during the day when nobody was around, you'd get a better sense of how bad it actually is.

But hey, feel free to spend upwards of $250 MILLION to upgrade the existing facility, entirely out of your own pocket. You won't get any other benefit except a pig with a new lipstick job in the crappiest part of town.

The simple reality is that $250M is better spent downtown for any number of obvious reasons that've been stated here and elsewhere ad nauseum.

Get it freakin' done FFS.

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#54 TO HELL with it
September 19 2012, 07:05AM
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TO hell with all professional sports. I for one am no longer going to dote over every move of the "stars" - giving my precious time, energy and attention this increasingly meaningless spectacle. I get more excitement out of watching my 6 year old play (really!). And he is isn't asking me for $100 million, that you know will never be paid back.

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#55 -30-
September 19 2012, 07:25AM
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@ Jason, regarding, "Both sides need to recognize that some mutual compromise and leadership is needed. I hope we see some leadership from both parties as we near the end of this long negotiation."

Is the best thing Katz can do after being so reclusive and NOT speaking, to come out sniping about city council and the mayor?

It really sounds like this guy is trying to play the media. He goes to the Larry King of Oiler infotainment knowing that Larry, er, Bob will only lob softball questions.

How can it be that all of city council and the mayor who by the way happens to be the BIGGEST booster of the arena have all the facts wrong?

All of city council is wrong in their recollection of the agreement and Katz is right?

Alderman Diotte is right. Play hardball like Katz is playing hardball. Tear up the agreement and start from scratch.

Bettman isn't letting this franchise go anywhere.

We the taxpayers have the ball.

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#56 michael
September 19 2012, 07:59AM
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@Reg Dunlop. Save the neighborhood critiques about "crappiest part of town" and speak to what you know like the corporate suite that you were renovating. The neighborhoods surrounding the Coliseum are filled with blue collar and white collar workers just like everywhere else. Included are "working ladies" who do not live in our communities. Communities like Highlands and Montrose are 100 years old. Other communities west of the Coliseum are even older.Older does not necessarily equate to lesser than. Neither does newer equate to better than.

That said I believe in a new downtown arena. I have been to Rexall within the past year and for me a modern arena is needed to replace Rexall just as many believe. Why. The biggest issue for me is safety. The corridors are way to narrow. The concourse is undersized and creates an environment where safety becomes an issue at intermission or when an event is ended. The ladies do not have enough bathroom space. The concessions are outdated and create enormous backlog onto the concourse. The seating is outdated and to narrow. Tell the average 6ft 185 lb man that those seats fit him. How many Albertan men fall into the average category? The average is probably more like 6 ft 210+. That is few points i have issue with Rexall.

The other issue is the whole experience. Your correct when you say that the neighborhood around Rexall is not what was envisioned when it was built. The 118th corridor has improved recently but still has a long way to go before anyone could say that it is a destination place in the City of Edmonton like Whyte Aveneue. Jasper Ave has seen a renaissance in the past 10 with new restaurants and bars opening. When you go to Rexall there is none of that. Sure the venerable Coliseum Steak and Pizza still stands but beyond that there are no other dining options even close. We,the people of Edmonton, deserve better. We need an Arena that says to the rest of the world that we will not accept mediocrity in place of saving a few bucks. When I walk into the Art Gallery I am proud to be an Albertan. The "new" Provincial Museum will be iconic. I want buildings that we can all be proud of. New Rexall should provide to the patrons what LA Live offers. An experience. We should look at redefining ourselves not looking for more of the same old. "Old" Rexall has served the city well. 40 years has come and gone. Its time to envision something new and exciting. The time is now for our council to be bold and step forward into the unknown future and grasp what could be a landmark project for this city.

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#57 Spydyr
September 19 2012, 08:26AM
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David S wrote:

I took the time to listen to that interview. In fact, many hard questions were asked. Too bad you were busy with more important stuff. Although not busy enough apparently to stop you from dropping by and offering up yet another scintillating arena hater comment.

You guys are jealous of Katz. Fine. You want everything for nothing. Fine. You don't believe you need to spend money to make money. Fine. You think the existing arena is plenty good enough. Laughable, but fine. You won't watch any games at the new arena, nor have a meal or drink or see a movie in the new sports and entertainment district. Unlikely, but fine.

But you may want to at least listen to what the man has to say before chirping. Just sayin'.

He is saying give me your money for his private business.

He refuses to open his books.

He has enough money he does not need more of MY hard earned money.

It would be cheaper for the the City to buy the team than to buy him an arena.

Take off the Oiler blinders.Say he owned a muffler shop.

He would want to be the only muffler shop in town.He would want the city to build and pay to run his shop. He would take all profits from the muffler shop.

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#58 NewAgeSys
September 19 2012, 09:27AM
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If I were katz i would hardball the con-artists and BSers in this city,everyone from the Oilers to the City is a con here in Edmonton,it killed us on a Provincial level over the last 20yrs and it is killing us now.

Hire some professionals to get the job done already and get rid of the amature BSers we have here working for the City.

We shouldnt even be listening to the City anymore just the statements from the firm they hired to get the deal done after they voted to do it.

Why am I hearing from Mandell ,what the hell do him and the city councillors know about money or massive projects like this??Someone should have been hired a long time ago to do this job professionally.

Do you honestly think katz is making these decisions himself??Get real,he has hired pros,so who have we hired??Who is telling mandell and the clowns what to say??Our homegrown business talent???Lord help us,people who make a living working as community consultants are actually involved in a major business decision???

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#59 Jprime
September 19 2012, 09:46AM
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@TigerUnderGlass

Arguable both ways.

He's an Edmontonian. I would like to at least think he would be somewhat inclinded to be wanting to help his home town grow.

What is his mission exactly? Make money? I am sure that is what most of us do on a daily basis. Try and be profitable.

Edmonton may be a small market but it has done of potential and growth value. Especially with the economical state of our province.

So, he zoned in on a good oppurtunity that so happens to be the city that he grew up in. If I were in his position - I'd be doing the same.

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#60 Jprime
September 19 2012, 09:58AM
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@Spydyr

Its not a private business. It is a public-private business.

Why does he need to open the books to the public? Katz Group isnt a public company. What does he have to gain from that? I am positive that he has shown financial statements to the City council. The people you entrust with your vote and tax dollars. Do you show your financial statements to everyone in the bank when you apply for a mortgage?

Katz group is taking the majority of the profits because he has to pay all the expenses that come with the building. Expenses are a thing; and just like all businesses, you find ways to offset expenses through revenue streams - and in this circumstance, its the gaming and gambling revenue.

You don't want to take the time to follow and learn about the semantics of the ordeal - okay. Then stay off the topic as well.

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#61 Reg Dunlop
September 20 2012, 12:10AM
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@michael

Hey Michael;

I think you may be mistaking me for young master D Staples. I made no such comment about the area around Rexall, in fact I grew up in the shadow of the coliseum and only moved away after being propositioned by a hook in my driveway at 7:00 am on my way to work about 20 years ago (she was asking for too much $$$). Also,the area north of the proposed arena site ain't too grand either.

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#62 tom bernard
September 24 2012, 06:44PM
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Well Edmonton enjoy the run peterpuck and darrylpuck is the same guy...kiss our... Is the way it is. Seattle Oilers is okay. I spent my life loving hockey and all sports here...but enough.

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#63 a
September 28 2012, 03:29PM
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The Grinch that stole.... #yegarena #yeg #oilers pic.twitter.com/QhgTw1PP

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