HomeMy WebLinkAboutCSD-16-075 - 2021 Canada Summer Games Bid
REPORT TO: Council
DATE OF MEETING: December 12, 2016
SUBMITTED BY: Kim Kugler, Director, Sport Division, 519-741-2200 ext. 7544
PREPARED BY: Bob Cheyne, Manager, Sport Development & Golf, 519-741-2200
ext. 7689
WARD(S) INVOLVED: All
DATE OF REPORT: December 7, 2016
REPORT NO.: CSD-16-075
SUBJECT: 2021 CANADA SUMMER GAMES BID
___________________________________________________________________
RECOMMENDATION:
That City of Kitchener Council authorizes the Regional Sports Tourism Office and
the Canada Games Bid Committee to proceed with Phase 2 of the 2021 Canada
Summer Games bid subject to the concurrent commitment of all three City
Councils: Kitchener, Cambridge, and Waterloo and further;
That upon successful award of the 2021 Summer Games bid to the waterloo
Region the three municipalities make the commitments related to its bid proposal
for the 2021 Canada games which include agreement to accept all hosting
standards for the 2021 Canada Games as outlined in the 2021 Bid Hosting
Standards document attached as Appendix A which include the following
commitments:
a) Underwriting any deficit associated with the games (capital or
operating) shared equally by the municipalities.
b) Provide a commitment of at least $3 million to the Host Society in
cash for capital expenditures ($1 million per municipality).
c) And advance $220,000 to pay the Rights Fee and Transfer of
Knowledge fee ($73,333 per municipality) and further;
That Council authorizes the Mayor and City Clerk to execute all documents
required to implement the above recommendations for the 2021 Canada Games,
subject to approval of the City Solicitor.
EXECUTIVE SUMMARY:
In September 2016, the Canada Games Council announced that the Cambridge-
Kitchener-Waterloo joint bid was selected to proceed to Phase 2 of the 2021 Canada
Summer Games. The bid submission deadline is January 31, 2017, a visit by the bid
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
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evaluation committee is scheduled for February 28, 2017 and the final announcement
regarding the successful community is scheduled for March 31, 2017.
The cities of Kitchener, Waterloo, and Cambridge have been moving forward with the
Regional Sports Tourism Office (RSTO) and the Volunteer Bid Committee to fulfill the
requirements for Phase 2 of the bid.
In an effort to complete the documentation required for Phase 2 of the bid there has to
be commitment from all three municipalities to host the Games; the bid cannot move
forward without commitment from all three municipalities.
The three municipalities are seeking the concurrent approval of their respective
Councils to proceed with Phase 2 of the bid process. Once the Bid Committee has the
required commitments they can begin to prepare memorandums of understanding for
the construction, renovations and use of facilities along with all the other support
documentation required to complete the bid submission.
BACKGROUND:
The City of Kitchener has had a strong history of bidding for and hosting sporting
events. Kitchener actually bid on the 2001 Canada Summer Games and lost to London.
Kitchener has hosted and partnered on a number of individual national sporting events
in which there were financial guarantees required from the municipality. The guarantees
were all met for the 1997 Women’s World Hockey Championship, the 2002 and 2006
ISC Fastball Championships, the 2008 CHL MasterCard Memorial Cup, and the 2012
Curling Road to the Roar.
The Canada Games are the largest multi-sport games hosted on a bi-annual basis
(alternating between winter and summer) in Canada. It is the key pathway in the
development of sport and serves as a national celebration of youth, culture, and
community. The economic impact models applied to the Games estimate an
approximate economic impact of +/- $100,000,000. The Games are hosted over 18
days in August with 19 sports, an estimated 3,500 athletes and 1,000 coaches and
support staff, 6,000 volunteers, 650 media, and 20,000 spectators. To date there has
not been a Winter or Summer Canada Games that has been left in a deficit position
after the Games.
On May 2, 2016, Council supported the recommendation in report CSD-16-023 to
endorse the RSTO to investigate a bid and submit a letter of intent to bid for the event.
The RSTO received confirmation on September 12, 2016 from the Canada Summer
Games Council that the Cambridge-Kitchener-Waterloo joint bid was selected to
proceed to Phase 2 of the bid process. Other cities being considered by the Canada
Games Council include Sudbury, Ottawa, and Niagara.
REPORT:
The RSTO has assembled a local group of ambassadors to be on the Volunteer Bid
Committee, charged with spearheading Phase 2 of the bid process. A Municipal
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Working Group has also been formed with staff representatives from each of the three
municipalities and the Regional Sport Tourism Office to work with the Bid Committee
and be a liaison between the Bid Committee and Council for consistent messaging,
practices, and processes between each municipality.
If the Cities all support completing Phase 2 of the bid then each municipality will
contribute $20,000 to the RSTO and Bid Committee to assist with the costs of
completing the materials for Phase 2. The City of Kitchener will use existing funds from
the 2017 Sport Development budget.
Upon receiving confirmation of successfully being awarded the Games a Host Society
would be set up to be responsible for the planning and execution of the Games. Some
Bid Committee members could transition to the Host Society, while other positions
would be recruited as volunteer or paid positions. The Host Society would be set up as
a non-profit organization and would be incorporated. The Host Society is required to
have a Board of Directors and operational staff. Representatives from each municipality
would be appointed to the Board of Directors. Staff will recommend that the Host
Society’s Senior Financial Manager be a secondment role from one of the municipal
stakeholders.
The cities would need to be in a position to move forward with a number of financial
commitments should the bid be successful. These commitments include advancing
funds for Canada Games fees, upgrading and renovating existing city facilities with
capital dollars, an agreement to reduce facility rental fees, if necessary, to balance the
operating budget, and an agreement to share in the underwriting of the financial debt of
the Games.
1. The first financial commitment to advance a Rights Fee and Transfer of
Knowledge Fee of $220,000 to the Host Society to be reimbursed from the Host
Society once it is formed and has operating cash.
2. The Federal and Provincial Governments provide $7,350,000 each towards the
operating budget for a combined operating budget of $14,700,000 to operate the
games. They also each provide a capital investment of $3,000,000 for a
combined total of $6,000,000 to be match by a $3,000,000 municipal
commitment. To meet the $3,000,000 capital investment the City of Kitchener
would be responsible for at least a $1,000,000 contribution towards capital. The
City of Kitchener funds will be found within existing capital plans.
3. While the Canada Games has a history of net zero to positive financial results, a
requirement of the bid process is for the municipalities to be responsible
(underwrite the games) for any debt (operating and capital). As this bid is a joint
bid with the Cities of Waterloo and Cambridge, it is recommended that debt
would be shared between the three municipalities. The financial impact to the
City of Kitchener will be responsible of approximately 1/3 of any financial deficit.
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Operating surplus reported by host cities from previous Canada Games:
Year Season City Surplus
2003 Winter Bathurst $700,000
2005 Summer Regina $3,534,382
2007 Winter Whitehorse $1,000,000
2009 Summer PEI $3,332,217
2011 Winter Halifax $2,548,786
2013 Summer Sherbrooke $2,255,500
2015 Winter Prince George $1,100,000
After reviewing a preliminary budget that was established based on the financial
performance of previously hosted games indicate that if no tickets or sponsorships were
sold there would be an estimated maximum funding shortfall of $6,000,000. If such a
shortfall occurred it would be divided amongst the three municipalities, for an
approximate risk of $2 million per city. Staff do not anticipate this will occur as there will
be financial controls and regular reporting in place to mitigate any potential financial
operation debt. The Canada Games also requires that the budget remain in a positive
position and that regular reporting occurs.
Additional implications for staffing, facility use and users have been identified and would
need to be managed leading up to the games.Impact on displaced users/rentals during
the renovation/upgrade times and during the event times is anticipated. Strategies will
be put into place to addresses these impacts.
Should the cities be successful in securing the 2021 games, it is anticipated that staff
work plans and capital project timelines will have to be adjusted.
Phase 2 requires the support of surrounding municipalities, local government, post-
secondary institutions and other key stakeholders. These parties have been identified
and approached to see if they are interested in supporting the bid. Once the three
municipalities (Cambridge, Kitchener and Waterloo) have confirmed their commitments
to proceed with the bid then the Bid Committee will approach and firm up the
commitments of facilities, services and finances from the additional stakeholders.
While there are significant financial commitments for each of the municipalities to jointly
host the games there are a number of benefits to the community which include +/-
$100,000,000 economic impact, investment in existing sport infrastructure and the
legacy of the Games themselves.
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Capital funding will be used to upgrade and improve existing facilities rather than
building new buildings. This will assist in addressing facility asset performance in the
city’s comprehensive asset management plan, infrastructure deficit funding concerns as
well as leveraging dollars for ongoing maintenance/renovation to existing venues.
The legacy of a successful 2021 Canada Summer Games for the City of Kitchener is:
an increase in volunteer experience of hosting such an event
to strengthen the collaboration of the RSTO and the municipalities for growing sport
tourism
sport development growth opportunities that would occur as a result
facility upgrades and improvements
The Municipal Working Group is currently exploring possibilities to deal with any
surplus. One working idea is to create a reserve fund to support the ongoing efforts of
future capacity for sport event hosting.
This event provides an opportunity to collaborate with local companies to help
showcase their products and services on a national stage. The Bid Committee will reach
out to companies who could be involved to better improve and enhance the Canada
Summer Games. Integrating the local technology companies with an event of this scale,
could make these games the best technological games in Canada.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Strategic Action EC5 – Sport Tourism
By working with the RSTO and the Volunteer Bid Committee on submitting a bid for the
2021 Canada Summer Games supports growing Sport Tourism within Kitchener.
FINANCIAL IMPLICATIONS:
The City of Kitchener will contribute $20,000 from the 2017 Sport operating budget to
assist with funding the Phase 2 submission. This funding will be used to complete
financial estimates, marketing materials and other materials required to complete the
final documentation package and for a reception in February to showcase the
municipalities.
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If successfully awarded the bid, the financial implications for City of Kitchener include
the advancement of $73,333 to allow the Host Society to pay Canada Games fees
which would be a loan advanced from the 2017 Economic Development Reserve or
Sport budget and a capital commitment of at least $1,000,000 for facility enhancements
and upgrades to be addressed during the 2018 budget cycle. There could also be a
potential need to provide in-kind through reduced facility rental fees in 2021 for the use
of the facilities which would be identified in the 2020 budget cycle.
COMMUNITY ENGAGEMENT:
INFORM – This report has been posted to the City’s website with the agenda in
advance of the council meeting.
COLLABORATE – Staff will be assisting the Bid Committee in reaching out to minor
sport groups, other sport groups and the business community to engage them in the
process and seek their support and commitment to hosting the games with volunteers
or financial commitments. This same approach will occur across all three municipalities.
CONSULT – Staff are in consultation with community leaders who have volunteered to
join the Bid Committee to submit an application to host the 2021 Canada Summer
Games.
ACKNOWLEDGED BY: Michael May, Deputy CAO
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APPENDIX A - 2021 Bid Hosting Standards
“Based upon and subject to the public financial planning assumptions provided by the
Canada Games Council at the February 10th, 2016 bid launch:
Government of Canada – operating* $7,350,000
Government of Canada – capital* $3,000,000
Government of Ontario - operating $7,350,000
Government of Ontario – capital $3,000,000
Municipal government – capital** $3,000,000
*Subject to the appropriation of funds by Parliament and to the budget levels of the
program.
**Does not preclude municipality from contributing to operating costs, or more to capital.
The minimum of $3,000,000 in capital funding from the municipalities to be equally split
between of Cambridge, Kitchener, and Waterloo.
That Council approves the following commitments related to its portion of the bid
proposal for the 2021 Canada Games: ...”
Hosting Standards
i. Agreement to accept all hosting standards for the 2021 Canada Games as outlined in
the 2021 Bid Procedures and Hosting Standards document provided to each community
by the Canada Games Council (CGC) for delivery by the Host Society.
Financial
i. Agreement to be responsible for financial deficit associated with the Games (Capital
and Operating);
ii. Agreement to contribute approximately 1/3 of the $3M capital investment as per the
financial public planning assumption at least $1 million to the Host Society in cash for
capital expenditures;
iii. Confirmation of additional financial commitments (in cash or value in kind) from the
City of Kitchener or other community partners (example: colleges and/or universities,
not including the Government of Canada, Provincial Government or CGC);
iv. Confirmation that the first 25% of the Rights Fee and Transfer of Knowledge Fee
$220,000.00 will be shared among the three municipalities (Kitchener, Cambridge,
Waterloo) and paid upon award of the Games (the CGC has approved the TOK fee and
it will be instituted subject to concurrence of F-P/T Governments in the future), with the
Municipality reimbursed from the Host Society once it is formed and has operating cash
(Reference Hosting Standard #10-M-04).
Bid Transition
i. Agreement that the host municipalities will provide appropriate capacity (both human
and financial resources) to ensure an efficient transition from bidding community to the
Host Society and will cooperate with the Bid Committee and CGC on the steps
necessary to achieve this critical step upon the award of the Games and up until further
public resources can be accessed.
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Airport
i. Confirmation on the selected Provincial/Territorial Team Travel airport, with
accompanying letter of confirmation from the Airport Authorities that confirms the
selected airport and airport services will meet Hosting Standard #60-M-06.
Sponsorship
i. Bid Sponsors
Confirmation of understanding that Bid Communities have the authority and power to
grant local community sponsors certain rights and opportunities, pertaining to the
Community bid only. Bid sponsors may be granted by the Bidding Community the rights,
privileges, options and opportunities as a bid community sponsor to be exercised only
within the bid community during the term of the Bid Community Sponsorship Grant of
Rights and Exclusions Agreement
ii. Sponsorship Team Approach and Principles
Confirmation of understanding that Bid Communities and eventual Host Societies must
acknowledge the need to work within a team approach and abide by the guiding
sponsorship principles referenced in Appendix E. The sponsorship team principles and
team approach create additional sponsorship solicitation capacity to raise the
appropriate outstanding revenue required and to minimize the risk associated with the
municipality underwriting the deficit.
Legacy
i. Agreement and confirmation that the each host municipality (Cambridge, Kitchener,
Waterloo) will ensure that the words “Canada Games” and “Jeux du Canada” and the
Canada Games logo in accordance with the Council’s Graphics Standards Manual, are
incorporated in the name of at least one major facility that is built or renovated for the
Games, and the naming rights remain in perpetuity. The facility must be branded with
the Canada Games logo. The Canada Games emblem must be used on external
signage with the title then printed in English (Canada Games Centre) over French
(Centre des Jeux du Canada) or vice versa. The three municipalities of Waterloo,
Kitchener and Cambridge will work with the Host Society and CGC to finalize details,
and will submit the proposed new name and logo in writing for approval by CGC, taking
into consideration key principles and elements identified in the CGCs Core Legacy Plan.
(Ref Hosting Standard #14-M-02)
ii. Confirmation of understanding that the Host Society will develop a Legacy Plan,
following the CGC’s Legacy Core Plan, to guide the documentation of all legacies
resulting from the 2021 Canada Summer Games (including the potential distribution of
financial legacies, planned and/or surplus.)
(Reference Hosting Standard #14-M-01)
Agreements
i. Confirmation that The City will co-sign an Agreement to Undertake upon award of the
Games which will reflect the above commitments as well as other key commitments,
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terms and conditions through the bid phase dependent on the commitment of the cities
of Waterloo and Cambridge;
ii. Confirmation that the City will ensure that the Host Society, upon Incorporation, will
enter into a Joinder Agreement with the Canada Games Council which binds the Host
Society to the Agreement to Undertake, and to the signing of the Trademarks
Agreement and Hosting Agreement with the CGC;
iii. Confirmation that the City, in cooperation with its Bid Committee, for both City-
owned/operated and private facilities, will submit agreements at the Bid level that
comply with Hosting Standard #40-M-01.
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