D-day coming soon for proposed new arena

By Doug Herod

It will be stop or go time this fall for a new downtown St. Catharines spectator facility.

And the preferred site has now shifted back to the low-level parking lot below St. Paul St., rather than the Jack Gatecliff Arena property.

City chief administrative officer Colin Briggs said the municipality is spending an increasing amount of time and money investigating the feasibility of a new building that would house the Niagara IceDogs as its main tenant.

“At some point, you want to know you have a viable project,” said Briggs.

“I think we’re going to ask council to make a decision on whether to proceed or not in the fall. I think we have to.”

To that end, staff intends to submit a report to council, likely in October, that would update the estimated cost of the facility, firm up revenue projections and identify potential sources of funding.

If council is “comfortable” with the numbers, the next step would be to seek bids from builders.

Early estimates pegged the cost of a 5,000-seat arena at $42.5 million.

Also to be nailed down by October is the site of the puck palace.

When the city first started down this path in late 2008, the low-level parking lot was viewed as the top option. Over time, though, focus shifted to the Gatecliff site due to concerns about soil conditions in the old canal valley. Gatecliff was tabbed as the preferred alternative in a report to council this past May. Council, though, voted to keep all downtown options open.

IceDogs owner Bill Burke has made no secret of his dislike for the Gatecliff proposal, primarily because his team would be forced to find other suitable digs for at least a season.

Becoming vagabonds for a year would cause great inconvenience, increase expenses and drastically reduce revenues for the team, asserted Burke. The Ontario Hockey League has since weighed in, stating it’s not in favour of having one of its teams roam around for a season.

These expressed concerns were enough to cause the city to refocus on the low-level lot.

“They both have challenges,” said Briggs of the parking lot and the Gatecliff site. “Neither one of them is an easy deal to put together.”

The city has done a site-specific risk assessment of the property and is hoping the ministry of environment will approve a record of site condition shortly. Contaminants have been found 20 or 30 metres below the surface, but shouldn’t have to be removed for an arena project, said Briggs.

Still to be determined, though, is the premium attached to putting footings in the fill.

“We’ve always figured half-a-million to a million dollars for footings. That’s what I want to update,” said Briggs, explaining the city is doing more geo-technical tests in the valley site.

Burke thinks the lower-level site is an ideal location.

“I think it’s absolutely perfect, with an entrance at either end of the arena coming off St. Paul St.,” he said.

The site could also use the new parking lot and the existing city parking garage on Ontario St.

“And all the parking that’s available during the day for business, is now available at night for entertainment and a new facility,” Burke said.

Locating the arena in the low-level parking lot would allow the city to sell the Gatecliff/Rex Stimers property and use the sales cash to offset the cost of the new facility. Municipal officials believe the current arena site could be redeveloped for residential use to complement public initiatives downtown.

The city is also in the process of hiring an operator for the proposed arena. The selected company will offer design suggestions and help crunch operating-revenue numbers for the October report to council.

A key source of revenue will be lease payments from the IceDogs.

Briggs said the city intends to hammer out the terms and conditions of a long-term agreement with the OHL team based on the move to a new spectator facility, and present the deal for council approval during the October arena deliberations.

Less clear is the future tenancy of the junior B Falcons hockey team.

Drawing 400 fans to a 5,000-seat arena may not be what the Falcons are looking for, said Briggs.

Moving to the Seymour-Hannah complex would mean building a small addition to the spectator rink there to provide the team with a suitable dressing room. Brock University has first tabs on the existing top dressing rooms based on a long-term lease it has signed with the city.

Another possibility for the Falcons is becoming a tenant in a new recreational rink.

If the Rex Stimers/Gatecliff complex is torn down when a new arena is built, the city would be short one rink. Council has acknowledged the potential rink deficit and has promised to address it. If another one is built in the future, it could be sized in a way to accommodate the Falcons’ needs.

All options, though, said Briggs, “will be based on affordability.”

One element missing from the fall report to council will be a financial commitment from the federal government.

The city is still very much interested in tapping into the government’s private-public partnership fund, which could provide up to 25% of the project’s capital cost.

But the best it can hope for by October is confirmation the spectator facility is eligible for P3 funding. That news should be delivered in the next few weeks, said David Oakes, the city’s economic development head.

If the project is deemed eligible for the P3 program, the next step would be to prepare a business plan or “value-for-money” case that would be submitted to the program overseers by March 2012. A decision on funding would be made by June, following which construction could begin.

The P3 timeline is one of the key reasons staff wants council to make a decision on the project this fall. Once the commitment to proceed is made, the city could then call for bids from consortiums interested in partnering on the arena.

The consortium, in tandem with the operator, would help prepare the city’s value-for-money case to the feds.

At this stage, Oakes said the city is “leaning” toward a P3 model that would have the private partner design, build and maintain the spectator facility.

If the private partner is locked in to a long-term contract to maintain the facility’s fabric and systems, said Oakes, it will act as a check to ensure no corners are cut in the arena’s design or construction.

The city can still proceed with this model regardless of whether the project is judged worthy of P3 funding, although under that scenario local taxpayers would obviously be picking up more of the tab.

In an earlier update to council in May, staff presented a number of financing scenarios based on a $42.5-million cost.

Depending on the fundraising component, the amount of P3 funding received and how much money is taken from the city’s community development fund, the report suggested the project could cost the average taxpayer between $7 and $27 a year to pay for the capital project.

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