City losing $6M arena grant

Photo: City of Penticton

The City of Penticton's proposed twin-rink arena at the SOEC

The City of Penticton is going to have to walk away from a $6 million grant earmarked for a proposed new twin rink arena on the South Okanagan Events Centre campus after missing the deadline to find the rest of the project’s funding.

The city received the grant from the federal gas tax fund in March 2018, when the twin-rink idea was merely an idea of council and the city’s citizen arena task force. The $36M plan would see Mclaren Arena demolished, Memorial Arena converted into a dry facility and two more sheets of ice constructed on the west edge of the SOEC campus.

The $6M grant, however, was contingent on the city securing the rest of the funding by March 31, 2019. The city meanwhile only received the project’s final business plan and funding analysis from a consultant last month.

“Although it may be difficult to give up a grant with a $6M capital value, the due diligence for this project isn’t complete and it would be irresponsible to make budgetary decisions without a detailed funding strategy that is understood and supported by the community,” said director of facilities Bregje Kozak in her report to council.

The Union of B.C. Municipalities, which administers federal gas tax grants, has refused to grant Penticton an extension.

The business plan for the project states the twin-pad facility would cost the city about $100,000 per year to operate, while a dry Memorial Arena would cost $87,000 annually — similar to its current deficit.

Penticton city council will be faced Tuesday with a decision on how much money it should pour into Memorial and Mclaren Arenas and for how long.

“The challenge before us is when to invest? We can continue to provide bare minimum annual investment to ‘keep the lights on’, knowing that eventually this will be unsustainable,” Kozak said.

“We can also plan for a more significant investment in order to extend the life of the facilities and ensure uninterrupted continuity of service levels for 10 or 20 years, or we can take it to the fullest extent to replace existing facilities and convert Memorial Arena to a multi-use dry floor space, which would address the long-term needs for arenas and fulfill the vision of the arena task force.”

The city is already spending $500,000 this year to replace the roof on the 67-year-old Memorial Arena.