Ontario government may write off Corel Centre loan
Ontario Premier Ernie Eves said Monday that the Ontario government is prepared cut or even eliminate a multi-million dollar loan extended to the Corel Centre in order to help billionaire Eugene Melnyk buy the Ottawa Senators.
The provincial government loaned about $26 million to the current owners of the Senators in 1996 to build a highway overpass to the Corel Centre.
The loan is being repaid through a surcharge on ticket sales. About $21 million is still outstanding on the loan.
Melnyk, head of a huge pharmaceutical firm and a prominent owner of thoroughbred racehorses, has made an offer to purchase the Senators for about $100 million. However, the offer is contingent on reduction of the provincial loan.
"I think that we should be able to come to an agreement to make sure that the right thing is done and that the Senators are able to continue on," Eves told an Ottawa radio station Monday. "I think that both ourselves and the municipality, as well as other creditors, are all going to have to do their bit."
Eves said that he had met recently with NHL Commissioner Gary Bettman to discuss the offer being made by Melnyk. Both Eves and Bettman felt that Melnyk would make a good owner.
NDP leader Howard Hampton said his party would oppose any reduction in the loan because the Senators have already received financial assistance through a reduction in property taxes.
"I think what people need to be asking is how many times are professional sports teams going to come cap in hand begging for money. Especially when these professional sports teams are owned by billionaires," Hampton told the Canadian Press.
The City of Ottawa has forwarded a plan that would see the loan eliminated and a special tax be levied on future development around the Corel Centre.
The city's mayor Bob Chiarelli said that if the plan is not accepted the Corel Centre will "will go into bankruptcy protection and the province won't get a penny."
with files from the Canadian Press