By Leah Hendry
Support for the survival of the Ottawa Senators seems to be flooding in from everyone but the most important of contributors — the federal government.
Last month, the provincial government offered to cough up $4.2 million in provincial and municipal property taxes to the team if the two-tiers of municipal government agree to chip in.
In a report released last week, The Ottawa Economic Development Corp., studied the effect of the Senators on the local economy and determined it’s an integral part of the city.
The report estimated the Senators will have a local financial impact of about $750 million over the next 10 years.
But the federal government has failed to join the love-in and maybe hockey fans should thank them for keeping tax dollars in their pockets.
Industry Minister John Manley has gone so far as to suggest Canada’s NHL teams would be better off in the U.S. if profit is the chief motive of their owners.
If that isn’t a subtle indication of where the federal government stands on the issue, I don’t know what is.
Of course profit is a motive. In order to pay the ballooning salaries of players and cover the costs of the arenas they play in, profit is key to a team’s survival and competitiveness.
Currently, Canadian teams pay a whopping $200 million a year in taxes compared with $12 million a year for the 22 U.S. teams combined.
There is no evidence the federal government will reduce these exorbitant entertainment taxes. Neither will the sagging Canadian dollar miraculously fix itself.
It’s depressing the Canadian teams are struggling to compete at a sport we like to call our own, but if the teams ask for money now and the federal government grants their wish, the calls will come more frequently and they will ask for more later.
The loss of the Winnipeg Jets is a case in point. According to Winnipeg Mayor Glen Murray, the city provided $2 million in tax subsidies at first, then $20 million and in the final years of the Jets’ existence, $50 million.
Despite increased tax relief the Winnipeg Jets still packed their bags for Phoenix in 1996.
Senators’ owner Rod Bryden says he needs $10 million to $12 million in tax relief from the three levels of government to compete against heavily subsidized U.S. teams. Those are his demands now, but what about a couple of years down the road?
Kanata Mayor Merle Nicholds is right to be cautious of endorsing tax cuts to the team — giving tax cuts to the Senators means raising property taxes for homeowners and businesses. The pockets of ordinary citizens are not bottomless.
Losing a NHL hockey team is a blow to Canadian pride but Winnipeg has survived without the Jets. They brought the Manitoba Moose, an International Hockey League team, to town and even captured a number of high-publicity events such as the Pan-Am Games.
A city without a NHL team is not dead. People just have to be more imaginative in where they find their entertainment.
There will always be Canadian hockey players, but increasingly they will play south of the border for more money.
We might not be able to go down to the local arena to watch our favourite team but we can switch on the TV and catch them there.
It’s cheaper.