Who wins the $80 million dollar Prize?
March 17, 2017 – Contributed (This piece was originally sent to the Victoria Times Colonist as a Letter to the Editor.)
THE PROPOSED 80 MILLION DOLLAR EVENTS CENTRE: SHOULD NANAIMO “GO FOR IT”?
by Eric Ricker
In a January 26th editorial entitled “Nanaimo arena worth the risk,” this newspaper compared the proposed Events Centre (EC) in Nanaimo to Victoria’s Save on Foods Memorial Centre and concluded that this comparatively small mid-island city should simply “go for it.” With the referendum vote fast approaching it’s worth examining the props beneath this cheerleading declaration.
The editorial suggests that an EC will contribute to downtown revitalization, as indeed does the City of Nanaimo’s documentation. Unfortunately, there’s not a scrap of evidence to support this argument, just as there was none about a decade ago when Nanaimo voters were persuaded by a narrow margin to support the construction of what has proved to be a greatly under-utilized conference centre – a structure that has not induced much in the way of new construction in its part of the downtown and, judging by the comments of the owner of a building across the street that was ravaged by fire a year or so ago, has had no positive impact on property values.
That EC’s will not have these effects was confirmed last week by Jordan Bateman, Canadian Taxpayers’ Federation BC representative, who visited Nanaimo to pour some cold water on the city’s rosy economic forecasts for the EC as well as its overly optimistic business plan. More about those aspects below.
The proposed EC will potentially seat almost as many hockey fans and big event supporters as Victoria’s facility, just as the local conference centre can handle as many if not more delegates at one time than the Victoria Conference Centre. That alone should have been a big red flag to local boosters and to your editorial writer, because Nanaimo in so many ways is not Victoria, as the lack-lustre performance of the conference centre has shown. At about 100 thousand people, Nanaimo is also not in the same league in terms of area population or in the number of citizens with adequate disposable incomes to regularly attend events at an EC.
Nor can it begin to compete as a tourism draw – just witness the anemic performance of our cruise ship terminal, which counts itself fortunate if it can pull in more than half a dozen ships each season. Nor does one consultant’s overly expansive view that a Nanaimo EC may draw upon upwards of 400 thousand residents in its presumed catchment area – one that evidently extends from the Malahat to Cape Scott and everywhere in between on both coasts. That consultant clearly doesn’t know much about Vancouver Island’s geography or its winter-time driving conditions.
But apart from mistaken notions about needed capacity and impacts on downtown revitalization and tourism, an EC could never run at a profit let alone on a break even basis, as city hall maintains it will, even though, according to Mr. Bateman, no other EC in BC has achieved that wondrous state. It’s an important point since it is Nanaimo’s taxpayers who will be entirely on the hook for this project if it is approved, and that means other needs will take second place for years to come.
Perhaps most disturbing because it provides the illusion of expert approval is the city’s misrepresentation of its commissioned third party analysis of the EC proposal. Consultants Ernst and Young were hired to examine the city’s supporting documentation and business plan as well as to conduct interviews with other EC operators.
In a cover letter attached to the “draft” business plan dated February 22, the city’s chief financial officer states that Ernst and Young was retained “to ensure the highest level of accountability regarding costs and revenue projections.” Yet Ernst and Young states, for its part, that “Our report is based on facts as we know them, estimates, assumptions and other information….EY does not represent these estimates as results that are anticipated to be achieved” (emphasis supplied). And just to make certain Nanaimo’s city hall gets it, EY provides this disclaimer: “To the fullest extent permitted by applicable law the, Client (the city) shall hold harmless the EY Entities and their respective assignees, subcontractors, members, shareholders, directors, officers, managers, partners, employees, agents and consultants”….etc., etc.
In other words the “highest level of accountability” is really no accountability at all. Nevertheless, if one perseveres through the virtually unfathomable bafflegab one finds in parts of the EY report, qualified support for the city’s plans is offered – subject to numerous caveats, of course. Unfortunately, the extent of even that degree of support must be taken with a grain of salt because EY is not exactly what one thinks of as a completely independent — that is, disinterested — third party assessor. And that’s because it’s been promised an ongoing contractual arrangement with the EC project if voters give their approval this Saturday. (March 11)
There is so much that is wrong with the EC proposal – I’ve barely scratched the surface here — that the only sensible decision is to defeat it and, if there remains an appetite for the idea after the vote, the city should start from scratch with an entirely different approach.
This particular EC proposal, in other words, is anything but a “go for it” proposition. It needs a complete rethink.
Dr. Eric Ricker is a retired Dalhousie University professor of educational policy and public administration who now resides in Nanaimo, his hometown. Those who have resided in Nanaimo since the Conference Centre fiasco will recognize Dr. Ricker’s work in opposing it and as the editor of a book on the subject, Nanaimo between Past and Present: Critical Perspectives on Growth, Planning and the New Nanaimo Centre, which can be found at the library as well as posted on this blog.