Keith Gerein: Edmonton, Oilers look to score big provincial investment

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As the Edmonton Oilers find success this spring as one of the final four teams still competing in the National Hockey League playoffs, it seems the organization and the city are closing in on a major victory off the ice.

Multiple sources have confirmed to Postmedia that the Oilers Entertainment Group has been working with city officials and the UCP government on a plan to have the province make a major sports and cultural investment in Edmonton — including, potentially, upgrades Commonwealth Stadium, demolition of the old Coliseum and various improvements to the Ice District.

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The discussions stem from the province’s controversial decision last year to contribute $330 million to assist Calgary’s new arena project, including money for road and LRT improvements and to tear down the Saddledome.

As that promise was gaining steam during the election, you may remember Premier Danielle Smith also offered a vague assurance of fairness for Edmonton, saying that her government was in talks with OEG about aiding some of their land development ideas for the Ice District.

At the time, I was among those highly skeptical of the premier’s words. Her message felt like a hollow affirmation easily dismissed after the election, and her government’s subsequent decision to cancel the south Edmonton hospital further convinced me that the UCP wasn’t much interested in spending money in a city where it didn’t elect a single MLA.

However, it turns out there is some substance to this. Nothing has been finalized and everything could still fall apart, but the sources tell me all three parties have serious interest in getting something done in the near future.

Apparently there is even hope an announcement can be made during the Oilers’ current playoff run to take advantage of fan revelry — provided certain sticking points can be worked through.

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Exactly how it all proceeded to this stage is still a little unclear.

Strong relationships already existed between OEG and provincial officials, and so those two parties seem to have had the initial talks. But similar to the Calgary deal, the government wanted to make sure that any investments it made were for “public infrastructure,” and that it was not seen to be dealing directly with a private corporation, sources said.

That obviously meant the city had to be a central part of the negotiations and, to be fair, municipal officials have been pestering Smith’s office for an investment similar to what was given to Calgary. My understanding is that city leaders are now working with OEG to complete a final package of proposals to take to the province.

I’m told all parties agree that a portion of the money should go to cover the demolition of the Coliseum, a job for which council has already set aside $35 million. That’s scheduled to take place next year.

As for the other parts of the potential deal, there are reportedly still some things to work out, including what to do with Commonwealth Stadium.

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The city has previously asked the province for $180 million to modernize Commonwealth — a now 46-year-old facility that did not show well when Edmonton tried to land hosting duties for the 2026 FIFA World Cup.

However, there is a debate about whether the city is actually best served in the long run by sinking money into Commonwealth, or if it might be better to build a new, smaller stadium that is more soccer and/or concert friendly. That’s undoubtedly the more expensive option, and it’s unclear what the province might be willing to contribute and whether OEG would be involved.

Also on the table are a number of improvements to the area around Rogers Place. OEG, I’m told, would like to see a portion of the money go toward some combination of security improvements, assistance in building out the fan park next to the arena and a contribution to phase two of the Ice District, which calls for a mixed-use development north of the arena.

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This is where the deal could get difficult for city council and taxpayers.

A key player in the negotiations, OEG is going to have to come out of the deal with a big win or two. But council may be reluctant to approve something in which OEG is seen to be the prime beneficiary over the city.

As an example, I suspect some may dispute whether the phase two development is appropriate for public money. Likewise, there could be disagreement around what sort of security enhancements should be prioritized — surveillance, policing, social infrastructure, lighting, etc. — and whether those dollars should be spent just in the Ice District or a wider area of the core.

(Also unknown is what funding the city might have to contribute to any piece of this, which is not a small question given the municipality’s current financial difficulties.) 

All told, such questions indicate that if an announcement is to be made in the short term, it is likely to be an incomplete one, with the players vowing to work out certain details later.

Either way, there is a broader discussion to all this that should prove fascinating.

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On one hand, it is fair to wonder about the spending decisions of the province and whether these sorts of investments offer the best long-term benefit to Edmonton.

Similar to the UCP’s government’s recent announcement around developing high-speed rail and commuter train networks, these are exciting, bold initiatives, but also seem somewhat superfluous when basic necessities are suffering. In other words, why is there money available for stadiums and speeding trains when the government is pulling funding from health projects and watching classrooms become overcrowded?

At the same time, if this is what the province is prioritizing, then Edmonton would be foolish to question an invitation to the party.

Finding a government willing to spend major money on sports and cultural projects is often a once-in-a-generation opportunity. These are things cities generally can’t afford to tackle on their own, and yet they offer great potential to attract investment, events and tourism that are a boon to the economy.

Municipal officials need to keep that in mind as they strive toward the best deal possible.

Coincidentally, the last time the Oilers played in a conference final, Edmonton also learned it had been rejected for the 2026 World Cup. Hopefully the script changes this spring for both the team and the city.

kgerein@postmedia.com

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