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Sunday, November 14, 1999
A sensible route to save the Sens
Merle Nicholds was kicking up her heels on our front page last week, standing along Palladium Dr., as ground was broken for an enormous new Nortel complex that will house about 850 workers.
The irony was that the street on which the Kanata mayor stood would not exist but for the National Hockey League's Ottawa Senators. Nor would the Terry Fox Dr. retail strip be quite as lively a place.
That's not to say that the team, and the Corel Centre, drive the region's economy, as was alleged in that somewhat silly economic development report released last week. What it does illustrate is that the Senators do have a major role to play in the region -- not just Kanata.
The team unquestionably lifts the profile of the Ottawa region, it is used as a recruiting tool, and it does generate a considerable amount of economic activity for a variety of businesses.
The Senators' owner, Rod Bryden, is a shrewd and very capable businessman. He is also considered a man of great honesty and integrity, making him the perfect spokesman for Canadian teams as they fight to level their playing field against American competitors who have received millions in tax breaks and outright freebies from their communities.
Even when Bryden gets the relief he seeks, as he almost surely will, his team will still contribute more than $20 million in taxes to the region, province and nation.
THIS IS BUSINESS
What Bryden wants is not out of line with business realities, but one has to look at it in a business light to see that. Many businesses are offered a helping hand (through grants, tax relief, concessions, etc.) when their sector experiences difficulty, from the steel industry, to farmers, airlines, railways, even big multinational corporations like Bombardier.
And the formula to assist the Senators need not be that complicated. If the province follows through on its promise to create a new property tax classification, and the region (NOT just Kanata taxpayers) can negotiate a way to share the burden, then about $3.5 million in savings can result.
That's a third of what Bryden seeks.
If the province decides not to challenge the legal loophole Bryden has discovered to avoid paying the discriminatory Amusement Tax, there's another $3 million. By having the charitable Ottawa Senators Foundation sponsor all home games, he believes that makes the team exempt from the tax. Under the letter of the law, Bryden is probably right.
That leaves about $4 million more to be found.
If the province would relent, and pick up the remaining cost of the Hwy. 417 interchange the Senators were forced to build, at a cost of about $35 million, then Bryden saves another $2 million per season.
FEDERAL SHARE
And if the feds chip in by allowing him to accelerate the tax writedown he is allowed for the Corel Centre (called the Capital Cost Allowance), that could make up the difference.
Another option for the feds is to create a 10-15% withholding tax on large lottery/gambling winnings, which would generate millions not only for NHL teams, but might also increase funding for our cash-strapped amateur sports programs.
One reason the feds say they won't budge yet is because the NHL, the teams, the provinces and other stakeholders can't all agree on one plan of action. Yet the feds treat provinces differently all the time, so why not create plans that work in each area, rather than one blanket policy?
Hockey is a part of our culture and heritage. The Senators contribute to the fabric of our community, to our economy, our charities, and to our civic spirit.
It's lunacy to think we would all wither and die if the team were to go, but most of us would miss the Senators.
And that does not have to happen.
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