“Pizzuto said city staff were capable of dealing with hockey operations.”

My ten year old niece is capable of dealing with hockey operations – as long as she too is given a blank cheque by the city.

The question is not whether council and staff are capable of dealing with hockey operations but whether they are capable of doing so with competence.

Pizzuto said funding the hockey team is different than coming up with money for roads or the Matsqui pool. “Closing Matsqui would save an operational expense every year,” he (Pizzuto) said.

Let me get this straight, we close Matsqui pool to save a $100,000 operational expense every year but we pay $275,000 of the Heat’s operating expenses plus however many additional hundreds of thousands of dollars it costs to operate the arena for the Heat every year.

Matsqui pool yearly operational expenses Bad; the considerably higher Heat/Complex yearly operation expenses Good.

City council and staff’s attempts/threats to close Matsqui pool have become a yearly ritual with never a whisper about the plus side for the community of the pool and “it is in the City’s best interest not to fund those operational expenses”; on the other hand council and staff have demonstrated the determination of lemmings to have the Arena open for business with a hockey team as a tenant – so one hears a mighty chorus from city hall about all the wonderful benefits for the city of the arena operations and it does not matter how many $millions$ operational expenses cost the taxpayers.

The truth, the reality, of the agreement between the City and the Heat lies in Mr. Pizzuto’s statement “This is what it took to have a team in Abbotsford,”

As beleaguered taxpayers recall, at the time Abbotsford’s city council began its mad scramble to put a hockey team into the arena citizens with an understanding of basic financial reality raised the point that Abbotsford City Council had to have the discipline and willpower to leave the arena without a hockey team, if the financial numbers said that was the action in the best financial interest of Abbotsford’s impoverished taxpayers.

Given city council and staff’s demonstrated reckless adventurism when it comes to the finances of Abbotsford any reasonably astute taxpayer has reason to be concerned on that point.

Council was urged to make the decision on whether to sign an agreement with any hockey team (or to leave the arena totally dark) on the basis of the financial numbers – not on the basis of saving council from embarrassment by signing an agreement based on ‘a team at any cost’.

And what kind of agreement did the Abbotsford enter into with the Heat?

“This is what it took to have a team in Abbotsford”

An agreement that will have the taxpayers of Abbotsford out of pocket a city estimated $275,000 this year plus the additional $hundreds of thousands$ of dollars spent to operate the Complex for the Heat to use.

An agreement where it is the taxpayers of Abbotsford that have assumed all the financial risks involved with the operation of the Heat while it is the Heat ownership that will reap all the rewards if the team is successful.

With the agreement the City entered into with the Heat, the City would have been better off to purchase the Heat themselves. Taxpayers are already on the hook to pay for the team if it fails and ownership would have allowed the City to reap the rewards for this risky venture should the team somehow succeed.

“This is what it took to have a team in Abbotsford”

The agreement that city councillors have committed the taxpayers of Abbotsford to, with all the financial risk taxpayers are now on the hook for, was not about sound financial decision making or about the best interests of the citizens of Abbotsford.

It was and is about having a team in the arena to permit council to save face by offering more false promises of profit, at some point in the future if everything goes unrealistically well.

Unlike council I do not favour decision making based on vague promises, although there is always the chance that with the Heat in the building something could go wrong with the ice surface and in making repairs city workers could hit oil and the arena cease to be an millstone dragging taxpayers down into poverty.

As the front page of The Province screamed this agreement is a Hockey Nightmare in Abbotsford because the agreement was signed not because it was good for Abbotsford, but because council was determined to have a hockey team at any cost and

“This is what it took to have a team in Abbotsford.”

We need to ban the word and concept of ‘profit’ from use or even consideration by Abbotsford City Council.

Not only can taxpayers not afford to pay for any more Abbotsford City Council ‘profit’, but the evidence is overwhelming that such a ban would save the beleaguered taxpayer’s of Abbotsford millions of dollars.

The agreement between Abbotsford and the Heat and the statements made by the City illustrate just how important it is to the future financial health of the City of Abbotsford that ‘profit’ be banned.

Here are the things council (and taxpayers) need to consider when the agreement is presented to them Monday March 15, 2010.

“I use the example of a WestJet 747 parked on the tarmac. It can only make money if you use it,” said Abbotsford Mayor George Peary.

It is erroneous assumptions/statements like this that have placed Abbotsford in its current dire financial state.

A little homework would have revealed that scattered across deserts in Southern California, Arizona and New Mexico are 5 aircraft storage facilities full of a broad assortment of aircraft sitting there in storage in order to save money.

I want to introduce Mayor Peary, council and staff to an important piece of financial reality – “a penny saved is a penny earned”. When it is going to cost you more to use Mayor Peary’s 747 than it will generate in revenue you profit by leaving it parked and saving the expenses (losses) you would incur in operating the plane.

“If we didn’t have a team, then where would we be? We’d be worse off,” Pizzuto commented.

As was pointed out by those with a firm grip upon financial reality when the possibility of an AHL team in the Sports and Entertainment Centre first arose – if the costs incurred in having a team in the building are higher than the revenue you generate from having the team in the building you save money – are better off – not having a team.

So Mayor Peary’s statement “The prospect of no hockey team and an empty arena would be a huge drain on the city” is currently inaccurate and untrue. Currently it is having a hockey team that is a drain on city resources, whereas no team and an empty arena would have saved the taxpayers of Abbotsford significant amounts of their tax dollars.

But having an empty arena would be embarrassing to council and city hall so one could hardly expect council and city hall to put the financial wellbeing of Abbotsford and its taxpayers above face saving for council and city hall, could one?

I could, but then I am accounted as one of those ‘nay sayers’ – you know, those citizens who oppose council’s continuing practice of recklessly spending the City into an ever deepening financial black hole. I do admit that I am puzzled as to how being opposed to council and city hall’s financial mismanagement is a negative (nay sayer) thing?

On the other hand attacking those who are asking rational questions and demanding full disclosure of revenues and expenses is a time honoured way of avoiding having to disclose embarrassing facts.

A way to avoid answering questions that would let citizens evaluate the mayor’s claim that “the deal had to get done” or whether this was a ‘deal’ the city should have run away from.

Questions any reasonably astute person would ask before agreeing to such a major financial commitment. Questions, the answers to which will undoubtedly give rise to further questions, as undoubtedly would a close reading/examination of the agreement itself.

Questions such as what is the cost, what are the expenses incurred, in operating the Centre for the Heat as tenants? And exactly how are these costs accounted for? Are they included in the Heat budget as part of hockey operations as they should be or are these costs excluded and hidden in other operating costs of the arena – thus providing a major hidden subsidy to the Heat and its owners?

What happens financially in regard to the concessions vis-à-vis the Heat? Does the City get the profit? Does the Heat get the profit? Just who does profit from the concessions during Heat games, how and what are the numbers?

Questions about attendance projections as the accuracy and reality of these projections have a direct impact on whether Abbotsford continues to pour major amounts of taxpayer dollars into the pockets of the Heat ownership.

Attendance is of particular importance given evidence from the WHL, AHL and NHL suggesting that the first and second years are the best/easiest years for attendance and that attendance declines after that. Take the case of the WHL Chilliwack Bruins who have suffered a 30% decline in attendance from their 2^nd year attendance levels.

Is the $5.7 million a) an annual revenue guarantee; b) the point at which the team becomes responsible for expenses incurred; c) the break-even point?

Since we are dealing with Abbotsford City Council and City Hall – exactly how fixed is the $5.7 million fixed? Is the $5.7 million going to remain at $5.7 million or will it, like so many other amounts declared ‘fixed’ or ‘guaranteed’ by Abbotsford Council going to balloon ever upwards? Does it seem reasonable that the Heat expect their expenses to remain at $5.7 million dollars over the ten year period?

Why is “The city’s agreement is similar to standard entertainment deals, which ensure a payment to the entertainer, and a profit-sharing equation for any remaining revenue”? Since we are talking about a hockey team should an agreement not be similar to standard rental/tenancy agreements between hockey teams and cities elsewhere? Is it because in other cities professional hockey teams not only pay rent, but pay rent at a level that covers the costs incurred in operating the arena with them as tenants? Is it because in other cities the City does not pay the professional hockey team to play in their arena?

What other information is contained in the agreement that city council and staff deems that taxpayers ‘Do Not Need to Know’? What arrangement has the city put in place so taxpayers read the agreement themselves in order to arrive at an informed opinion on the agreement?

To understand why those two questions are important you need only read Mayor Peary’s statement concerning whether of not the city is paying the travel costs for other AHL teams to travel to Abbotsford – “The city itself is not making cheques out to the AHL for travel. You have to remember, the AHL took a huge leap of faith to come out this far west”.

It does not matter that the city is not making cheques directly out to the AHL for travel when the city is subsidizing the Heat who are making the cheques out to subsidize travel. Following that logic how long before the city is claiming they did not pay anything to build the Sports and Entertainment Centre – that it was the lenders who paid for the arena and the fact that the city is repaying the lenders does not mean the city paid for the arena.

The truth is that the city, in spite of its promise not to subsidize the costs for other AHL teams to travel to Abbotsford, is subsidizing the travel costs of AHL teams to come to Abbotsford – Reality as opposed to the council’s semantic games.

Truthfulness – a concept that together with financial common sense would have saved the taxpayers the financial pain of the city’s current financial straits.

Speaking of semantic games one cannot overlook that Mayor Peary’s ongoing semantic game of “the decision made by the previous council has given this council a huge challenge” is getting old or alternatively could be a sign of a major problem/worry for Abbotsford taxpayers.

Mayor Peary might I suggest at the next council meeting you look around at the faces on council? You will find that this council is pretty much made up of the members of the previous council. So please spare us the disingenuous blaming of prior councils for current problems while ignoring the fact those previous councillors who are current councillors.

Finally as regards Mayor Peary’s challenge “There is an election in a year and a half time. I hope some of the critics come up with better ideas and run for office”.

Unfortunately by that point in time council will in all likelihood have committed the city to the agreement with the Heat and engaged in who knows what other financial misadventures. As result of which, no matter how much better the ideas new councillors come up with, all the new councillors and council will be able to do is lessen the negative fallout of the decisions and actions of our current councillors.

Still Abbotsford and its taxpayers will be much better off with new councillors with financial common sense and who have enough common sense to know that when you find yourself in a (financial) hole – you stop digging.