Calgary Flames arena deal paused over budget concerns

The multi-million dollar arena deal between the City of Calgary and the owners of the Flames is being pausedover "a difference in the current budget estimate and the program requirements for the facility."

That's according to the Calgary Municipal LandCorporation, the city-owned entity responsible for overseeing the $550 million project.

"Calgary Municipal Land Corporation (CMLC), along with our partners at the City of Calgary, provided an update to council at the April 13th closed meeting on the progress of the Event Centre," reads an emailed statement from CMLC,attributed to its president and CEO Kate Thompson.

"We started this project by developing principles and a program that would create a building that Calgarians would be proud to have in their city, and over the past several months, the team has developed a design to reach that goal."

It says the parties have agreed to pause the project to allow time to "resolve these challenges" related to the budget.

Coun. Jeromy Farkas, who isrunning for mayor, voted against the deal when it was before council.

"I didn't support the arena projects because of the unrealistic budgets and the very real chance of taxpayers being on the hook for cost overruns," he said Wednesday afternoon.

"And it looks like the budget's already been blown through."

He says if the project is over budget, council has to come clean with Calgarians and that "not one penny more" should be invested in the arena.

Mayor Naheed Nenshi, who is not seeking re-election,has a different view.

"Far better to have these issues sorted out at this stage than to have unexpected cost overruns after construction has begun," he said in a statement.

The deal to provide up to$275 millionof city funds to help build a new home for the Calgary Flames came just days after council announced budget cuts to services like transit and affordable housing and provided very little time for feedback from citizens.

It faced opposition from those who did not want to see public dollars paid out to help finance a building for a private corporation.

The deal between the two partners means the city retains ownership of the building, but Calgary Sports and Entertainment Corporation, which owns the Flames, is supposed to be the primary user of the space.

Coun. Jeff Davison said the two parties are still working together andthat CSEC has not asked for more money.

"There's been no ask of council for additional public dollars to go into this project. Council is committed to the deal we have signed. We are committed to the four major capital projects that we have going on in the city and we put a very specific model forward, a very specific model to go and do that," he said.

The building is intended asan anchor for a newly developed entertainment district skirting the Stampede Grounds and adjacent to the East Village in downtown Calgary.

It is one of several major projects approved by the city, including the nearby BMO Centre expansion for conventions and a redesigned and expanded Arts Commons near City Hall.