- 2015 Federal Election
Abbotsford Heat loss revised to $1.2 million
The Abbotsford Heat hockey club will cost the city an estimated $1.2 million this season, according to a correction released this week.
Originally, it was reported the AHL team would fall $724,000 short for the 2010/2011 campaign, plus a $450,637 shortfall for the 2009/2010 season.
However, city manager Frank Pizzuto said an error was made when interpreting the figures.
“Pat (Soanes, general manager of finance and corporate services for the city) came to me and told me there was a mistake. So I had to fix the error,” he said.
Pizzuto explained the $724,000 figure was a projection for the year 2010, not the entire 2010/2011 season. The full season deficit is estimated to hit the $1.2 million range.
“We erred and we’re correcting it.”
Because the final Heat figures are not yet released, the deficit will likely change.
“This is just a projection, we will get the actual, final numbers in July,” said Pizzuto.
The Heat year-end is June 30, while the city’s fiscal year ends on Dec. 31.
Last June, the city projected a final Heat deficit of $485,000 for the 2009/2010 season. The actual deficit was about $35,000 less.
The city is in the second year of a 10-year contract which guarantees the AHL hockey team revenue of $5.7 million. Any shortfall will be paid by the city.
If the city’s new projections are accurate, the Heat will cost Abbotsford $1.65 million over its first two full seasons.
Pizzuto said there are three factors in the Heat deficit: attendance, food sales and commercial rights (sponsorships and advertising).
The new numbers do not change the overall losses for the Abbotsford Entertainment and Sports Centre.
The AESC lost $3.4 million in 2010 ($1.2 million due to the Heat deficit) and $2.6 million in 2009 (including $450,637 for the Heat). Removing the Heat payments from the overall arena deficit, the AESC lost $2.2 million in 2010 and $2.15 million in 2009.
“That figure has remained steady,” said Pizzuto, adding Global Spectrum managed to cut costs in 2010 to compensate for a lack of events.
He noted the larger number of entertainment acts so far in 2011 is a positive indication the arena deficit may drop next year.
This year’s $3.4-million arena deficit is more than $1.5 million higher than was budgeted. The extra deficit will be covered using funds saved from other city departments.
Pat Soanes said while the AESC may have lost money, other departments did better than expected.
“We have an operating budget of about $140 million,” she said, adding there was a small surplus – enough to cover the extra $1.5 million – at the end of the year.
Job vacancies, increased savings on purchases and other cost-saving measures created the overall operations surplus.