Northlands could be facing its final weeks, says CEO Tim Reid
'We really need to consider our future as an organization'
The future of Northlands as an organization is in peril after council released a scathing report on the viability of the not-for-profit's plans for the Coliseum and the surrounding area, says CEO Tim Reid.
Reid said he disputes the city's findings, but the decision is ultimately up to city council.
"If this is the time and place when the City of Edmonton and the community of Edmonton don't believe that Northlands offers the value that it should, then we really need to consider our future as an organization," Reid said Thursday.
He said the idea of going out of business after 137 years is "incredibly daunting" for the Northlands board and its employees.
Northlands hopes to reinvent itself with $165M in renovations
On Wednesday, city staff released an analysis of Northlands plan and found the organization underestimated costs by $65 million, and overestimated the demand for some elements of the plan.
While Reid hopes there is still a place for Northlands in the city, he said it's important to recognize that the decision is largely out of the organization's hands.
He said the board will likely make a decision in September. The non-profit must reinvent itself quickly to adjust to the revenue it will lose when the new Rogers Place arena opens downtown next month.
The Vision 2020 plan proposed a number of changes to the Coliseum arena, the Expo Centre, the horse racing track and the casino.
However, Reid said he doesn't agree with some of the city's key findings, including its cost estimate. He said he stands by the initial projection of $165 million, and blamed the city for overestimating the cost in order to limit its risk.
"I just think the assumption of risk that we were comfortable with versus the assumption of risk the city was comfortable with just created a stretch that was perhaps more significant than we were anticipating," Reid said.
He said Northlands also assumed some costs would be passed on to developers
"Our (estimate) was really specific to the dollars that would actually be contributed by Northlands, or other levels of government, including the city," he said.
City takeover of Expo Centre could be costly
Another major part of Northlands' operations is also at risk if the city backs Mayor Don Iveson's proposal to merge the Expo Centre on the Northlands grounds with the Shaw Conference Centre downtown.
Northlands has asked the city to forgive a $47-million loan for the latest expansion of the Expo Centre. If the organization defaults on that loan, the Expo Centre will revert back to the city and Northlands' lease could be terminated.
Reid agreed there could be efficiencies to be had by merging the operations of the two convention centres, but warned whoever holds the keys to Expo Centre would also have to carry a $3-million annual deficit to run the operations.
"So what it would mean to the taxpayer is they would have to subsidize the operations on Expo Centre, where today Northlands subsidized those operations," he said.
City council will make a decision about the future of Northlands at a public hearing on Aug 31.