Markham Arena II
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06-28-2012, 11:15 PM
Join Date: Nov 2009
Originally Posted by
Thanks for clearing that up. The fact that it will be publicly owned makes it (very slightly) easier to swallow. They're still spending massive amounts of public funds on something that's of no economic value to the community (the idea that sports arenas and teams provide real economic benefits is a myth), but at least the resulting product will be owned by the community. It means that the community will at least have something physical to show for their expenditures instead of having to deal with simply handing buckets of cash to a private business enterprise.
I can see that you're right about the idea of a hard cap on the town's contribution, though I'm extremely skeptical that this means anything at all. I'm sure that, in the event of overruns, the town and the business consortium's lawyers will find some kind of creative way around the portion of the agreement that relieves the town of any obligation to cover overruns. Though, the articles I'm reading make it sound like the town can consent to providing additional funding, but that they are not obligated to do so.
Can you shed some light on that?
I can try, but I doubt it would be of much help. The agreement hasn't been completed and a quick scan through the proposal documents (see below) doesn't yield much.
Here's what the Town passed on April 26th, with regards to cost:
GTA Centre, LP will enter into a lease with Markham and into contacts to design, build and finance the Centre for a fixed price. Markham will own the Centre and will borrow the required funds for reimbursement to GTA Centre, LP upon completion of construction. The Centre will be designated as a Municipal Capital Facility (MCF) by by-law. Additional details of the project signature require further due diligence and will be reported back to council at a later date.
In other words, we'll just have to wait and see exactly how cost overruns are covered. I believe it was Roustan who said that his group would cover all cost overruns, though I can't seem to find the exact quote.
I still want to know why a billionaire and his private business partners need public funds to make this happen. They clearly have the money needed to build their own arena completely independent of public financing, so why don't they?
Do they believe that, in the absence of public funding, a major arena in Markham won't be profitable in the long term? I suspect that the town's eagerness (11-2 vote) to go ahead with the project is just the result of politicians and others eager to attach their name to a big, visible, impressive project, regardless of the costs and benefits.
Unfortunately it is par for the course for not only the arena business, but the business world as a whole nowadays.
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