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Edmonton council walks away from arena deal

The deal to build a new arena for the Edmonton Oilers collapsed Wednesday, with city councillors pointing the finger of blame at Oilers owner Daryl Katz and his last-minute demands for millions more in taxpayers money.

The deal to build a new arena for the Edmonton Oilers collapsed Wednesday, with city councillors pointing the finger of blame at Oilers owner Daryl Katz and his last-minute demands for millions more in taxpayers money.

Stephen Mandel said it was time to send a message.

"It's wrong to hold us up for ransom," said Mandel.

"This is not a council that said, 'Don't do a deal' - but what do we do when we have a partner that says, 'We want more money, and you pay for it?' " he said.

"I'm not saying we should say no to Mr. Katz, but all the information that I've had an opportunity to see does not justify council giving him another six million dollars a year."

Mandel made the comments after councillors voted unanimously to walk away from the deal agreed to last year with Katz to build the $475-million arena, starting in 2013.

Katz was not in council chambers when the decision was reached. He has been asked twice in recent weeks to meet with council in public to resolve the negotiating logjam but has refused, saying the two sides are so far apart there's no reason to meet.

The original deal had taxpayers and ticket-buyers building the rink with the Oilers spending about $15 million a year in lease payments and operating costs and keeping almost all the profits. It went off the rails a month ago when Katz said he'd had a second look at the numbers and needed millions more, including a $6 million a year in operating subsidies for the arena.

Mandel said he can't judge the merits of the demand because the Oilers have not made their case.

"I don't know what else we do," said Mandel. "Someone has to be willing to at least put information forward to justify their case.

"We need to send a message [to Katz] that you got a fair deal and stand up to that fair deal or show us why it isn't a fair deal," said Mandel. "And I can tell you he has not shown us."

Katz officials were not available for comment.

Earlier Wednesday, councillor Kerry Diotte said it's "shameful" to debate handing over money without any information from Katz.

"How can we even consider giving any tax money to a billionaire team owner when we haven't seen detailed financials," Diotte said to city manager Simon Farbrother.

Farbrother said no NHL teams divulge their financial information.

Not so, said Diotte. "In Scottsdale [Arizona], when the Phoenix Coyotes first went there, they tried to sell [the city] on doing a deal without the financials and they told them to get lost. I suggest we do the same thing."

Farbrother said the two sides have agreed to disagree on the $6 million subsidy, and that in his analysis Katz will "clearly make sufficient revenue to cover any obligations that come with operating the arena."

But Farbrother said the two sides have dug in on the issue.

"Will we have an agreement in the next two to four weeks?" asked Coun. Dave Loken.

"In the absence of significant movement on the [$6 million] operating subsidy we don't think you will have an agreement," said Farbrother.