EDMONTON – The city must stop “bullying” Northlands and resolve a dispute over the ticket tax it wants to retain at Rexall Place once the Oilers leave, Coun. Ed Gibbons said Wednesday.
He was commenting on a letter sent to the city April 9 in which Northlands insists it will not impose the existing surcharge when the Oilers move to a downtown arena in the fall of 2016.
Under a master agreement with Oilers owner Daryl Katz tentatively approved last week, the city would charge the same ticket tax — up to seven per cent — at Rexall Place and the new arena to create a level playing field.
Funds from the downtown arena surcharge would cover major maintenance and $125 million of the $480-million construction cost, while the Rexall Place money would go into city coffers.
However, a lawyer for Northlands argues the non-profit society must agree to continue the surcharge or else the move is outside the city’s powers under the Municipal Government Act.
“Based on this opinion, it is our recommendation to Edmonton Northlands that they strongly oppose any attempt by the city to levy a ticket surcharge on Rexall Place without the consent of Edmonton Northlands,” Roger Swainson wrote.
“I’m quite confident based on what I’ve reviewed with our lawyers that in fact this tax can’t be imposed on us without our approval, and we wouldn’t approve it unless we were going to be on an even playing field,” added Northlands President Richard Andersen.
Gibbons, who represents the city on Northlands’ governing board, said he thinks the organization has a point.
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“I’m of the belief that Northlands is true to their word and they’re not going to budge very easily,” he said. “I believe Northlands has something to stand on. I think we have to quit being the bully and start working together.”
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But Gibbons, who voted in favour of the tentative master agreement, said the issue won’t make him change his support for the project.
“I believe in a downtown arena, not necessarily for hockey, but to revitalize downtown.”
Coun. Bryan Anderson, who also voted in favour of the agreement, said city lawyers have indicated they have the legal right to levy the surcharge, but he doesn’t see this dispute derailing the new arena, which still requires $55-million worth of funding.
“The process is long and complicated,” Anderson said. “There are all kinds of things that have yet to be found and decided. The ticket tax is the least of our worries.”
While the tax was proposed for Rexall Place after Katz gave up his demand that the old arena be prevented from competing with the new one, the facilities might still seek out different markets, Anderson said.
“Richard Andersen is a very wise man,” he said. “I’m not sure he’s willing to go head-to-head with a new arena.
“They may find they want to go after things (like auto and trade shows) that don’t fit into a big new arena.”
He wouldn’t directly comment on whether the city is acting as a bully with Northlands, saying “the city is trying to be the broker that improves NHL stability and downtown reinvestment.”
Despite the back and forth, Andersen believes a mutually beneficial outcome can be reached.
“The city has said all along throughout this, they want to make sure that there’s an even playing field, they don’t want to see Northlands harmed in any way with the new downtown arena. And that’s all we’re trying to do is make sure that as we go forward we can have a sustainable future.”
City council is scheduled to ratify the arena legal agreements next week.
A copy of the letter sent to the City has been posted below.
Letter from Northlands’ lawyer to the City. Page 1.
Letter from Northlands’ lawyer to the City. Page 2.
With files from Global News.
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