Mosaic Place received almost $1 million more in subsidies last year than in 2019, which was a jump of nearly 250 per cent, data shows.
The municipality provided the recreation and entertainment venue with a subsidy of $394,114 in 2019, while it planned to give $526,347 in subsidies last year, a city council report said. However, after the pandemic affected operations, the total subsidy that the municipality provided was $1,370,769.
This means the subsidy jumped by $976,655 — or 248 per cent — from 2019 to 2020.
Mosaic Place’s finances were part of a year-end report that looked at total municipal finances from Jan. 1 to Dec. 31, 2020 that city administration provided to city council during the Feb. 16 regular meeting.
Council voted unanimously to receive and file the report.
Since the document was an early snapshot of finances, the numbers are likely to change once all bills and receipts have been accounted.
Budget details
Building manager Spectra Venue Management Services had budgeted gross revenues at $3.7 million last year, but that figure came in at $1.5 million. After all other net income and losses were combined, total event operating income last year was $238,308, compared to the expected $481,572, the data showed.
Mosaic Place eventually finished 2020 with an adjusted net loss of $1,276,675, compared to the expected loss of $618,281.
This deficit included a loss of $227,434 from the Ticket Rocket situation, $54,090 to manage COVID-19, $132,000 in management fees, and $24,000 in management incentive fees.
Council discussion
While Coun. Crystal Froese understood that the reduction in revenue was due to the pandemic, she said that she had difficulty seeing that in the report, especially when there were almost no events or activities held there last year.
City hall worked closely with Spectra last year during the pandemic, so when the municipality closed down its public buildings in March, Spectra was also shutting down Mosaic Place, explained city manager Jim Puffalt. Besides the capacity restrictions, Spectra also had to deal with the Ticket Rocket situation.
Ryan MacIvor, general manager of Mosaic Place, explained how Spectra saved money last year.
“From an operational perspective — our indirect expenses — we cut expenses of approximately $221,000 from temporary layoffs of staffs, managing utilities, (deferring) projects, (and) taking advantage of increasing some of the maintenance that we did,” he said. “But the reality is … (we had) a shortfall in event revenues of approximately $240,000.”
There was also a revenue shortfall of roughly $332,000 in other areas, since the building couldn’t host hockey games or sell sponsorships, advertisements, food or drinks, he continued. Mosaic Place is a recreation venue, and right now, Spectra is seeing a decrease in hockey and curling teams.
“The live event business really does drive the bottom line to Mosaic Place,” MacIvor said, adding despite the challenges, 140,826 people still attended events such as the Scotties, hockey games, concerts and meetings.
“A lot of that (information) is not reflected in that (document),” replied Froese.
Riding out the storm
For most recreation venues in Western Canada, if they’re doing at least 50 per cent of business, that’s pretty good, said Puffalt. Last year Mosaic Place had a cost recovery of 51 per cent, which was “exceptional work.”
Residents might be distressed at how Mosaic Place’s finances look, but they should remember that every entertainment and recreation venue worldwide is similarly suffering, said Coun. Heather Eby. It’s not Mosaic Place’s fault that the pandemic happened, since it also faces the same issues as elsewhere.
“As soon as this is over, it will bounce back, and it will be good,” she added. “But we have to ride out the storm.”
The next regular council meeting is Monday, March 8.
