City subsidy for Mile One climbs to $2 million

The tab for St. John's city hall to keep its neighbouring stadium and convention centre solvent has taken another jump.

Council will be backing a subsidy of $2 million next year for Mile One and the nearby St. John's Convention Centre, an increase of $500,000.

Council had added the same amount to its subsidy last year, making a $1-million jump for Mile One and the convention centre in two fiscal years. Last year, the overall debt had been estimated at about $7 million.

Coun. Ron Ellsworth said the subsidyfor the facility which has been losing money since it opened in 2001 is worthwhile, because the stadium and convention centre pump about $30 million into the city economy in spinoffs for hotels, restaurants and other businesses.

"As a businessperson I certainly wouldn't take it on and run it as a business, because it wouldn't put money into my pocket as the owner," said Ellsworth, who represents the city on the board of St. John's Sports and Entertainment, which governs Mile One.

"Why the City of St. John's can do it, and why we are doing it, is that it's an economic development engine that's been created."

Despite its $1.5-million subsidy this year, St. John's Sports and Entertainment ran a deficit of about $600,000.

Coun. Art Puddister, who last year opposed giving additional funds to Mile One, now supports an increased subsidy to bring stability to the facility.

"I'm not 100 per cent comfortable with it," Puddister told CBC News. "If you look at the overall benefits for the city I think it's something that's really, really worthwhile."

Still, Puddister expects Mile One, which has lost money this year on all but a few of the events it booked, to turn itself around.

Lionel West, a St. John's resident who has become something of a watchdog of council, thinks Mile One has proven itself to be a sinkhole.

'That's a lot of money'

"To me, that's a lot of money that could be getting used for infrastructure needs of the city," he said.

"Whether that means you give it away, or sell it fortwo or three or four million [dollars], in the long term, it might be that the city cuts its losses and actually gains because they're no longer contributing that money," he said.

Mile One was built after an intensive lobbying campaign to build a home for the St. John's Maple Leafs, the former farm team of the Toronto Maple Leafs.

However, the Leafs pulled the plug on the farm team, relocating it to Toronto in 2005.