The provincial government has rejected a request to subsidize an AHL hockey team that may be coming to St. John's.

Tourism minister Terry French said Wednesday that the government can't subsidize professional hockey.

"We decided that we wouldn't go down that road," said French outside the house of assembly in St. John's.

"[We decided] that committing money to a professional hockey team was not the right place to be. We had said no to people previously so the decision was easy."

French said Tuesday afternoon outside the house of assembly that he had been told to expect a formal proposal for a subsidy soon.

He said it will come from St. John's City Coun. Danny Breen, who is council's representative on the Mile One board. The board has been trying hard to lure a hockey team to the arena.

Tuesday morning Breen told CBC News that the city would like to have more money coming into Mile One but it doesn't want to spend more to achieve that.

"We want to have an anchor tenant," Breen said.

"We want to do it within the subsidy, and we're committed to doing it within the subsidy that we're offering to St. John's Sports and Entertainment at the current time."

The city currently provides $1.25 million for annual operations at Mile One.

Speculation is mounting that an American Hockey League team could return to Mile One Centre, depending on a series of events in the NHL that begin with the expected move of the Atlanta Thrashers to Winnipeg.

Breen said a new AHL franchise is a very attractive possibility.

"This is a significant opportunity for AHL to return to St. John's," he said. "We're certainly going to do everything that we can to ensure that it happens, if the opportunity presents itself."

A group that involves former Newfoundland and Labrador premier Danny Williams is reported to be involved in a potential deal, although it's not clear which NHL team would be affiliated with a minor-league team based in St. John's.

Williams has not been available to comment on any possible role he may have with a new hockey franchise at Mile One.

Mile One was built in large part to meet the demands of the St. John's Maple Leafs, although the Toronto Maple Leafs relocated its farm team in 2005 to be near the parent organization.

The stadium was then home base to the St. John's Fog Devils, which played in the Quebec Major Junior Hockey League before being sold in 2008 to a Quebec owner.

Since then, the city has scouted for a new team for Mile One, even though the facility's dependence on subsidies has actually decreased.