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Kingston Concerned About the LVEC
Currently known as the "KROCK Centre"
Formerly the "Kingston Regional Sports and Entertainment Centre" or KRSEC
Formerly the "Large Venue Entertainment Centre" or LVEC
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Whig Standard November 20 2007

No new taxes for arena: city

By Jordan Press

Even if donors fail to meet the $2-million fundraising goal set for the downtown arena, taxpayers won't be asked to pay for the shortfall, city staff say.

Arena project manager Lanie Hurdle said yesterday that staff are exploring several options. None would require further tax dollars to go to the $46.5-million sports and entertainment centre.

"We haven't finalized one action," she said. "We're not looking at tax-base funding to cover any possible gaps."

One option would be to use any unspent money from the project's contingency fund. Extra costs related to the delay in the arena's opening, combined with environmental and archeological expenses, are expected to leave $927,100 in the contingency fund.

"But, again, the priority is to wrap up the project first," Hurdle said. After that, the contingency fund could be used for a fundraising gap.

Hurdle said staff became concerned in October with the ability to meet the campaign goal before the doors open. Fundraising can continue after opening night on Feb. 22, 2008, but it would be more difficult, Hurdle said.

The most recent numbers on the city's website show the campaign has raised $655,113.93, less than a third of the goal. The campaign has three months left to raise the remaining amount required under the arena's business plan.

Hurdle said in-kind donations, such as advertising, have not been factored into the fundraising figure. She said fundraisers haven't given up.

Mayor Harvey Rosen, who chairs the fundraising campaign, told councillors last month that he would provide a report on future fundraising endeavours. To date, councillors have not received a report.

If the campaign falls short, city council would have to approve any contingency plan city staff develop.

Hurdle said staff haven't identified all the possible options and couldn't say if the city might use money from a reserve fund - essentially the city's savings account - to fill in the gap.

In September, the campaign entered the major gifts phase, which is when fundraisers solicit large donations. More than 90 per cent of the donations to the campaign have been under $100. About two per cent of donations have been greater than $5,000.

"The issue hasn't been with the community, or lower-end gifts," Hurdle said. "Where we see the bigger challenges is around the major gifts."

Hurdle said fundraisers have found it is taking longer than expected to secure those donations.

Soliciting major contributions is difficult, but most large gifts are wrapped up before a campaign goes public, said Michael Nilsen, public affairs director for the Association of Fundraising Professionals, which represents about 3,500 fundraisers in Canada and 28,000 across North America.

That can create excitement among other donors to give to a project, he said. However, major gifts don't happen overnight, Nilsen said, and the arena is close to opening.

"The public perception and time frame ... I think they've definitely got a challenge ahead of them," he said.

Another challenge is securing federal money for the arena. The city has for more than a year asked the federal government for a grant to the centre, but with no success.

Originally, the city asked Ottawa for $4 million to match the amount the provincial government gave to the project. The city revised that request over the summer and asked for $8 million.

The federal government never committed itself to funding the project, but did say it would consider it.

Formal negotiations can't begin until the provincial and federal governments sign a funding agreement, said Karine White, press secretary to Lawrence Cannon, the federal minister overseeing the fund.

White said federal officials will evaluate Kingston's proposal based on the goals of the $33-billion Building Canada fund that launched on Nov. 6.

The program will focus primarily on the environment and economy.

Sports facilities would also be eligible for funding, but would have to show the project has significant economic or regional impact.

jpress@thewhig.com