Alberta
Province announces new Calgary arena deal
Image from flamesnation.ca
Agreement moves new Calgary arena and event centre forward
Alberta’s government, the City of Calgary and the Calgary Exhibition and Stampede have signed a memorandum of understanding (MOU) to enable construction of a new world-class arena and event centre.
Calgary is growing and its economy has momentum, and the Government of Alberta is committed to investing in the infrastructure necessary to create jobs and improve Calgarians’ quality of life. Alberta’s government is answering the call with this agreement for a new arena and event centre by investing in critical infrastructure to support the new event centre and BMO Convention Centre expansion while revitalizing Calgary’s Rivers District, the Stampede grounds and downtown.
“This new arena and event centre will be at the heart of Calgary’s sports, entertainment and cultural scene for generations, and will result in billions of dollars of economic activity and a higher quality of life for millions of Albertans. The memories experienced here by families and friends will contribute invaluably to the fabric and spirit of this city for decades. Calgary is a vibrant world-class city deserving and in need of world-class facilities. Along with Edmonton’s Rogers Place, Alberta will now have two of the best and most modern event centres in all the world.”
Under the MOU entered into by the province, the provincial government will not be investing in the construction or operation of the arena itself. Those costs will be borne by the city and CSEC pursuant to a separate MOU between those parties. The province will instead contribute up to $300 million, the majority over the next three years, primarily committed to road and bridge construction, LRT connection, site utilities, site reclamation and other supportive infrastructure. These investments will be critical to the development of the entire area, will enhance access to the Stampede grounds and the expanded BMO Convention Centre, and ensure a vibrant downtown and Rivers District.
“One of my first actions as Premier was to publicly encourage all parties to return to the negotiating table and to appoint MLA Ric McIver along with my office’s executive director to work with the city and CSEC to get this deal done in a manner that respected the expectations of provincial taxpayers. Six months later, we have results and I am grateful to the city, CSEC, the Calgary Exhibition and Stampede, MLA McIver and everyone else involved who came together to get this job done. I can’t wait to get the project started.”
As part of the agreement, the province would also partner with the city to build a new 1,000-seat community arena neighbouring the main arena that will serve youth and amateur hockey. The province’s contribution would be up to $30 million.
The province’s commitments in this agreement are subject to cabinet and Treasury Board approval by August 2023.
“This project is another signal to the market that Calgary is making strong investments in its future. The partnership approach we have taken accomplishes two things: we are building an event centre, and we are also creating the public amenities needed within the Rivers District to enhance quality of life for all Calgarians.”
“The Calgary Stampede has enjoyed having the Calgary Flames as a neighbour since they arrived in 1980. We are honoured and excited to be a partner in this development that will contribute to a world-class landscape for our Calgary community. When combined with other developments, both existing and planned, an event centre complex of this magnitude will provide an anchor to attract and host the world in Calgary’s Culture + Entertainment District.”
“We are proud and excited to be part of the group to have established a clear path forward that provides a new home for Calgary’s sports teams; the venue to host A-class concerts and events; and a community gathering place, for many years to come. Thank you to the city, the province and the Stampede for your leadership and for coming together to create an environment of success.”
“Make no mistake, this project is about more than just a single building. It’s fulfilling our vision of a home for culture, sports, and entertainment. It’s a vital investment in our city’s future prosperity, vibrancy and growth. A little over a hundred years and 1.3 million people later, we have a new Big Four – four partners committed to building a community hub that will serve us for generations to come.”
From the Fraser Institute
By Tegan Hill
According to the recent mid-year update tabled Thursday, the Smith government projects a $4.6 billion surplus in 2024/25, up from the $2.9 billion surplus projected just a few months ago. Despite the good news, Premier Smith must reduce spending to avoid budget deficits.
The fiscal update projects resource revenue of $20.3 billion in 2024/25. Today’s relatively high—but very volatile—resource revenue (including oil and gas royalties) is helping finance today’s spending and maintain a balanced budget. But it will not last forever.
For perspective, in just the last decade the Alberta government’s annual resource revenue has been as low as $2.8 billion (2015/16) and as high as $25.2 billion (2022/23).
And while the resource revenue rollercoaster is currently in Alberta’s favor, Finance Minister Nate Horner acknowledges that “risks are on the rise” as oil prices have dropped considerably and forecasters are projecting downward pressure on prices—all of which impacts resource revenue.
In fact, the government’s own estimates show a $1 change in oil prices results in an estimated $630 million revenue swing. So while the Smith government plans to maintain a surplus in 2024/25, a small change in oil prices could quickly plunge Alberta back into deficit. Premier Smith has warned that her government may fall into a budget deficit this fiscal year.
This should come as no surprise. Alberta’s been on the resource revenue rollercoaster for decades. Successive governments have increased spending during the good times of high resource revenue, but failed to rein in spending when resource revenues fell.
Previous research has shown that, in Alberta, a $1 increase in resource revenue is associated with an estimated 56-cent increase in program spending the following fiscal year (on a per-person, inflation-adjusted basis). However, a decline in resource revenue is not similarly associated with a reduction in program spending. This pattern has led to historically high levels of government spending—and budget deficits—even in more recent years.
Consider this: If this fiscal year the Smith government received an average level of resource revenue (based on levels over the last 10 years), it would receive approximately $13,000 per Albertan. Yet the government plans to spend nearly $15,000 per Albertan this fiscal year (after adjusting for inflation). That’s a huge gap of roughly $2,000—and it means the government is continuing to take big risks with the provincial budget.
Of course, if the government falls back into deficit there are implications for everyday Albertans.
When the government runs a deficit, it accumulates debt, which Albertans must pay to service. In 2024/25, the government’s debt interest payments will cost each Albertan nearly $650. That’s largely because, despite running surpluses over the last few years, Albertans are still paying for debt accumulated during the most recent string of deficits from 2008/09 to 2020/21 (excluding 2014/15), which only ended when the government enjoyed an unexpected windfall in resource revenue in 2021/22.
According to Thursday’s mid-year fiscal update, Alberta’s finances continue to be at risk. To avoid deficits, the Smith government should meaningfully reduce spending so that it’s aligned with more reliable, stable levels of revenue.
Author:
Better, faster, more affordable auto insurance
Alberta’s government is introducing a new auto insurance system that will provide better and faster services to Albertans while reducing auto insurance premiums.
After hearing from more than 16,000 Albertans through an online survey about their priorities for auto insurance policies, Alberta’s government is introducing a new privately delivered, care-focused auto insurance system.
Right now, insurance in the province is not affordable or care focused. Despite high premiums, Albertans injured in collisions do not get the timely medical care and income support they need in a system that is complex to navigate. When fully implemented, Alberta’s new auto insurance system will deliver better and faster care for those involved in collisions, and Albertans will see cost savings up to $400 per year.
“Albertans have been clear they need an auto insurance system that provides better, faster care and is more affordable. When it’s implemented, our new privately delivered, care-centred insurance system will put the focus on Albertans’ recovery, providing more effective support and will deliver lower rates.”
“High auto insurance rates put strain on Albertans. By shifting to a system that offers improved benefits and support, we are providing better and faster care to Albertans, with lower costs.”
Albertans who suffer injuries due to a collision currently wait months for a simple claim to be resolved and can wait years for claims related to more serious and life-changing injuries to addressed. Additionally, the medical and financial benefits they receive often expire before they’re fully recovered.
Under the new system, Albertans who suffer catastrophic injuries will receive treatment and care for the rest of their lives. Those who sustain serious injuries will receive treatment until they are fully recovered. These changes mirror and build upon the Saskatchewan insurance model, where at-fault drivers can be sued for pain and suffering damages if they are convicted of a criminal offence, such as impaired driving or dangerous driving, or conviction of certain offenses under the Traffic Safety Act.
Work on this new auto insurance system will require legislation in the spring of 2025. In order to reconfigure auto insurance policies for 3.4 million Albertans, auto insurance companies need time to create and implement the new system. Alberta’s government expects the new system to be fully implemented by January 2027.
In the interim, starting in January 2025, the good driver rate cap will be adjusted to a 7.5% increase due to high legal costs, increasing vehicle damage repair costs and natural disaster costs. This protects good drivers from significant rate increases while ensuring that auto insurance providers remain financially viable in Alberta.
Albertans have been clear that they still want premiums to be based on risk. Bad drivers will continue to pay higher premiums than good drivers.
By providing significantly enhanced medical, rehabilitation and income support benefits, this system supports Albertans injured in collisions while reducing the impact of litigation costs on the amount that Albertans pay for their insurance.
“Keeping more money in Albertans’ pockets is one of the best ways to address the rising cost of living. This shift to a care-first automobile insurance system will do just that by helping lower premiums for people across the province.”
Quick facts
- Alberta’s government commissioned two auto insurance reports, which showed that legal fees and litigation costs tied to the province’s current system significantly increase premiums.
- A 2023 report by MNP shows
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