Keith Gerein: The province and Oilers’ investment agreement is still not “ruthlessly fair” for Edmonton

In the world of professional sports, there are often complex relationships between teams, their cities, and the wider public. These relationships aren’t just about game schedules, player performance, or fan engagement; they often involve significant financial investments, long-term commitments, and partnerships that can impact both the teams and the communities they represent. One such relationship that has been under scrutiny for several years is that between the Edmonton Oilers, the team’s ownership, and the provincial government of Alberta.

Keith Gerein, a well-respected columnist, has voiced concerns about this very relationship, particularly focusing on the investment agreement between the Oilers’ ownership and the provincial government. According to Gerein, the deal that was struck for the Rogers Place arena—a state-of-the-art venue in downtown Edmonton—is still not “ruthlessly fair” for the city or its taxpayers. His commentary has sparked conversations about the broader implications of such agreements for Edmonton’s economy, its sports culture, and the future of the team itself. But what does this term “ruthlessly fair” really mean in the context of public-private partnerships in sports? And why is Gerein, in particular, so critical of the current situation?

The History of Edmonton’s Arena Deal

The story of Edmonton’s partnership with the Oilers organization dates back to the early 2010s when the city was in desperate need of a new arena to replace the aging Northlands Coliseum (also known as Rexall Place). The Oilers’ ownership, led by Daryl Katz, had long been advocating for a new facility that would serve as both a hub for the franchise and a catalyst for the revitalization of downtown Edmonton.

In 2013, after years of negotiation, Edmonton city council approved a deal that would see the construction of Rogers Place in the downtown core. This facility would be a multi-purpose arena, home to the Oilers and a venue for concerts, events, and various entertainment. The $613 million project was largely funded through a public-private partnership, with the city contributing $125 million, the province of Alberta agreeing to cover the remaining costs through municipal and provincial taxes, and Katz’s ownership group contributing a substantial portion as well. The provincial government also provided $100 million in funding toward the development of the arena.

At first glance, the deal seemed to benefit all parties involved. The Oilers received a new, modern arena that promised to elevate the franchise and enhance the fan experience. The city of Edmonton was set to see a revitalized downtown area, with Rogers Place acting as the cornerstone of that growth. And the province of Alberta, although not directly involved in the daily operations of the arena, stood to benefit from the increased economic activity associated with a major sports venue.

However, the deal was also met with criticism from some segments of the public. Concerns about the long-term financial sustainability of the project and the fairness of the agreement for taxpayers have lingered. Over time, it has become clear that, while the Oilers ownership and provincial government benefited from a shiny new arena, Edmonton taxpayers might not have received the “ruthless fairness” Gerein references.

Keith Gerein’s Critique: The Lack of “Ruthless Fairness”

In his writings, Keith Gerein has been vocal about the need for transparency and equity in such deals, especially when public money is involved. The core of Gerein’s critique is based on the belief that Edmonton taxpayers did not get a fair deal out of the arrangement with the Oilers. He points to several issues that, in his view, underscore a failure to ensure the community’s interests were adequately safeguarded in exchange for their investment in the arena.

One of the central points Gerein raises is the lack of public revenue generation from Rogers Place. While the province and city put up substantial portions of the funding for the facility, the primary beneficiary of the venue has been the Oilers ownership group. In his view, the agreement did not structure adequate compensation for taxpayers, particularly when considering the lucrative game-day revenues from the Oilers, concerts, and events that Rogers Place hosts.

The argument is twofold: first, that Edmonton taxpayers should have received a larger share of the ongoing revenues from the arena’s operations, and second, that the Oilers, as a major asset to the city, should have been more invested in the long-term financial health of the partnership. Gerein’s criticism is rooted in the notion that the public has made a significant financial sacrifice, but the returns to the city and province have been disproportionately low when compared to the wealth generated by the arena for the Oilers’ owners.

Additionally, Gerein points out that the provincial government‘s role in the financing of the arena has been somewhat opaque. Despite contributing a substantial amount of money to the project, the government has not been in a position to exert control over the use of the facility or the financial aspects of the Oilers’ operations within it. This is problematic, Gerein argues, because it places a greater burden on taxpayers while offering them limited returns.

The “Ruthless Fairness” Concept

Gerein’s idea of “ruthless fairness” is crucial to understanding the crux of his argument. This term implies an unyielding approach to ensuring that public funds are used effectively and that private entities benefiting from taxpayer money are held accountable. In this case, “ruthless fairness” would mean that the Oilers’ ownership should be required to share a more substantial portion of the revenues generated by Rogers Place with the city and province. It would also mean ensuring that the public’s investment in the project is reflected in the broader community benefits, such as increased infrastructure, job creation, and economic opportunities.

To Gerein, “ruthless fairness” would have required the Edmonton Oilers to demonstrate a more comprehensive commitment to the community, both in terms of financial responsibility and long-term planning. This would mean rethinking the original agreement to ensure that the public receives its due share of the economic benefits and that taxpayers are not left holding the bag for an expensive project that does not generate the expected returns.

The Role of Economic Impact

When evaluating the fairness of such deals, it’s also important to consider the broader economic impact of the arena and the Oilers’ presence in Edmonton. The Rogers Place project was designed with the goal of revitalizing Edmonton’s downtown core, generating tourism, increasing local business activity, and fostering community engagement. In many ways, Rogers Place has succeeded in fulfilling these objectives. The arena has been a venue for major concerts, sporting events, and conventions, and it has attracted an influx of visitors and increased foot traffic in the surrounding area. This, in turn, has led to the development of new restaurants, retail spaces, and housing in the downtown district.

However, critics, including Gerein, argue that these benefits have not been sufficient to justify the level of public funding involved. While it is true that Rogers Place has helped revitalize the area, the question remains whether the economic growth generated by the arena has truly benefitted all Edmontonians. Gerein suggests that the Oilers ownership could have done more to ensure that the benefits were more evenly distributed, either through increased public revenue-sharing mechanisms or through more active community investment.

The Oilers’ Profitability and the Ownership’s Responsibilities

The Edmonton Oilers have undoubtedly become one of the most profitable franchises in the NHL under the ownership of Daryl Katz. The team’s success, coupled with the revenue generated by the new arena, has positioned the Oilers as a major financial asset. Katz and his ownership group have seen significant profits since the opening of Rogers Place, with increased ticket sales, sponsorships, and event bookings. This financial success, however, has not necessarily translated into a broader sharing of the wealth with the Edmonton community.

In an ideal scenario, critics like Gerein argue, the Oilers’ owners should have contributed more to the financial and social fabric of the city. The franchise is an integral part of Edmonton’s identity and should be viewed as a key community asset. Therefore, Gerein argues, it’s essential that the Oilers’ ownership be more transparent about the profits generated and more willing to invest back into the city in ways that reflect the community’s involvement in the success of the franchise. Whether through local business support, job creation, or infrastructure investments, the city of Edmonton should see tangible returns from its role in funding the arena.

Moving Forward: Is It Too Late for Fairness?

As the years pass and the deal between the Oilers and the province becomes further entrenched, it becomes clear that the vision of “ruthless fairness” that Gerein champions is becoming more difficult to implement. However, the conversation surrounding the economic fairness of such public-private partnerships is far from over. As long as the public continues to fund high-profile sports venues, these discussions will persist.

The ultimate question remains whether a better approach to such deals could have been forged in the first place and whether future agreements in Edmonton—or other cities—can be structured to ensure a more equitable balance of benefits. If the public continues to play a significant role in funding these projects, then, as Gerein suggests, it’s crucial to demand more transparency, accountability, and “ruthless fairness.”

In the end, the future of Edmonton’s relationship with the Oilers will depend on the willingness of both sides to engage in conversations that put the community first, ensuring that the franchise’s success is not just a source of profit for the owners, but a long-term investment in the people of Edmonton.