As Regina Exhibition Association Limited (REAL) looks ahead to a bleak future, all possibilities for the company’s next moves are being considered, including dissolving REAL into the City of Regina.
Earlier this year, MNP was tasked with conducting a financial review of REAL that would allow the city to better understand its long-term sustainability.
“If there is one central theme to MMP’s conclusion, it’s that for REAL to become financially self-sufficient, we must seriously consider significant changes to the business model,” city manager Nicki Anderson said at Wednesday’s executive committee meeting.
MNP does not believe REAL can achieve a break-even in the immediate term and expects REAL to sustain operating losses in the next three years, ranging between $4 million and $5 million each year.
MNP has outlined four options for REAL moving forward.
- Maintain an independent REAL with a mandate for a significantly lower-cost operating model.
- Dissolve REAL and absorb its responsibilities into City operations
- Seek input from the private sector operators who see value in the operating portfolio
- Explore alternative operating models with key tenants
For much of the meeting, councillors debated the scenario of dissolving REAL into the city. Ward 4 Coun. Lori Bresciani led the discussion and persuaded some of her colleagues to request a report on the situation.
It will outline the steps and effects of dissolving REAL and having the City of Regina take over management of all its assets, including operation and governance.
Bresciani’s motion passed 5 to 4.
One of those opposed to the decision is Mayor Sandra Masters.
REAL is seeking an increased budget of $5.8 million per year in funding from the city.
“This will provide REAL and City Administration the opportunity to review the results of the MNP Report and collaborate on options for a long-term sustainable business model,” the REAL business report reads.
If REAL’s budget request is not approved, they will begin three phases of a reduction plan immediately.
The first phase includes reducing the executive team by 15 per cent, and reducing security service around the facility.
Phase two of the reductions also includes reducing programming for the QCX by $500,000, and eliminating the winter festival Frost all together.
A third phase would see custodial services cut by 50 per cent and a reduction in summer ice availability at the Co-operators Centre.
Labour reduction would also occur in all divisions to reduce the scope of labour.
Finally, the entire organizational structure would be adjusted to eliminate executives and instead have a general manager.
Regina’s executive committee will continue discussions on REAL’s budget on Wednesday, but the final decision will be deferred until Dec. 13, when council begins deliberations on its 2024 budget.
More to come…
Comments