Moncton hands off Wildcats negotiations to private firm

It's a new era for the hockey business in Moncton, with elected councillors giving up their role in negotiating leases with the Irving-owned Wildcats of the Quebec Major Junior Hockey League.

With the closing of the legal agreements Wednesday for the new downtown centre, a private management company will take over the job of signing deals with the team which could put an end to taxpayer losses.

The city's agreements with the Wildcats have been fraught with controversyand have cost the city hundreds of thousands of dollars.

Coun. Dawn Arnold says SMG Canada, a global company that operates stadiums and arenas, will probably do a better job negotiating those contracts.

"My thinking is now we will have this professional company that will negotiate with all tenants and will take the politics out of that negotiation," she says.

"So that will be their mandate, to negotiate with whoever is going in there."

In a Facebook post in August, when council voted to go ahead with the project, Arnold wrote that leaving negotiations up to SMG would be an improvement on the city doing it "since you've seen that we're not particularly good at that!"

Double-bookings cost city

Earlier this year, taxpayers in Moncton had to fork over $185,000 to the Irving-owned team for three scheduling changes at the existing venue, the Moncton Coliseum.

That included $125,000 in compensation when the Wildcats had to move a playoff game to Fredericton because the Coliseum was already booked for another event.

The rest of the money was for the shifting of the start times of two games by one hour each.

In 2013, CBC News reported on internal city documents that said an annual $88,000 payment to the Wildcats under the lease was actually a concealed subsidy for another Irving company operating in Moncton. The city denied that.

Some city councillors have complained for years that the city's Coliseum lease with the team was too generous, effectively subsidizing the hockey operation at taxpayer expense.

When some councillors pushed for a better deal for taxpayers during the last lease negotiations in 2013, city manager Jacques Dub sent councillors an e-mail reminding them of the "major philanthropic impact" the Irvings had for the city.

The contract eventually signed in 2013 established an "additional revenue goal" for the city and said the team would pay the municipality $15,000 if it wasn't reached.

Even the push to approve the downtown centre became part of the city's contract.

The city would have been entitled to collect an additional 25 cents per Wildcats ticket if the Downtown Centre had been approved before March 15, 2015.

But because the project wasn't finalized by then, the city lost out on that revenue

SMG operates in several countries

SMG is a Pennsylvania-based company that operates arenas, stadiums, and convention centres in Canada, the United States, Germany, Poland, and the United Kingdom.

Under its contract with the city, SMG will run the centre and hand over a set amount to the city each year for 20 years or a share of the profit SMG makes, whichever is greater.

That will insulate the city from taking a hit on its bottom line from individual leases or contracts, including the Wildcats.

"This really takes the risk out of it for all the citizens of Moncton," Arnold says.

"They have the depth of knowledge and experience that's really going to be an asset for the management of our new sports and entertainment centre."

No one from SMG Canada could be reached for comment.

Ryan Jenner, the director of business operations for the Wildcats, told CBC News it was too early to comment on what kind of lease SMG may negotiate with the team.

"When the timing is right, negotiations will begin with SMG Canada," he wrote in an e-mail.