Martensville City Council is looking to get the best value for taxpayers’ dollars once the new $44.5 million Martensville Community Recreation Centre (MCRC) opens in the fall of 2024, according to the city’s Mayor.
“The goal is to have this facility break even, or as close to that as possible,” said Martensville Mayor Kent Muench in an interview on Wednesday, November 22. “It would be great if it made money, but that’s not likely, given that not one of our existing recreational facilities makes money.
“It’s a very large facility, and it needs to be managed and operated very efficiently; otherwise it has the potential for large losses. Those losses would have to be subsidized from property taxes, and that’s something we don’t want.”
Muench said the city is exploring all options, including whether to operate the facility completely in-house or to contract out those operations to a third-party company.
“There are pros and cons on both sides,” said Muench. “This process is about continuing to explore that, and making sure we have all the information we need to make the best decision for our ratepayers. This is about the city doing its due diligence.”
Martensville City Council voted at a meeting on Tuesday, November 21 to authorize its city manager to begin negotiations with Nustadia Recreation on a potential contract for the management and operation of the MCRC after it opens next year.
If a draft contract is achieved, it will have to come back to city council, where it will be reviewed and voted on. City council will have the final say on whether to contract out the management and operations of the facility.
Nustadia Recreation manages and operates 25 facilities in communities across Canada, including Merlis Belsher Place in Saskatoon and Evraz Place in Regina. The company provided Martensville City Council with an ‘expression of interest’ on entering into a contract for the MCRC several months ago. Preliminary discussions have taken place this fall between city officials and Nustadia.
There is currently no contract for management and operation of the facility between the city and Nustadia, confirmed Martensville City Manager Tanya Garost during discussions at the November 21 city council meeting. The motion adopted by council at the November 21 meeting allows city administration to enter into negotiations with Nustadia to hammer out operational details after the facility is open, including budgets, scheduling, the length of the contract, corporate advertising and sponsorship, and other areas, said Garost.
Many civic employees, however, are not convinced that contracting out the MCRC management and operations is a good idea. About 25 members of CUPE Local 2582, which represents approximately 50 unionized city workers, packed the visitors gallery in City Council chambers during the November 21 meeting.
Three workers, including long-time employee Russell Smith, addressed the November 21 council meeting on behalf of their colleagues. They expressed doubts about whether city residents and local organizations would be given priority for scheduling. They also questioned the quality of service if non-resident labour was employed, and whether the city intended to keep the Martensville Sports Centre arena open and operating once the new facility is up and running.
Muench responded that the city fully intends to keep the existing rink operating as long as possible.
“There’s never been any discussion about closing that rink,” said Muench. “We need all the ice surfaces we can get.”
Martensville City Councillor Spencer Nikkel responded to workers’ concerns about job security.
“This is more about expanding positions for new people,” said Nikkel, adding there is value in having a “baseline” to evaluate operations in the future.
“There is also a concern about the city not having control over user fees,” said Nikkel. “That would be part of the negotiations; what will the user fees be set at.
“Nustadia has a lot of experience in this area and will likely bring a recommendation on user fees to the negotiating table, but ultimately if we say we want user fees to be set at a certain rate, that is a choice that council can make during negotiations. If we want user fees lower, then we may have to subsidize them with taxpayer dollars.”
Martensville City Councillor Darren MacDonald said the city owns the building and will always retain the final say on how the facility will be managed and operated.
“The idea that a third party operator could just come in and run it however they want is not factual,” said MacDonald during discussions at the November 21 council meeting. “We would have the right to cancel the contract anytime if we didn’t like the way things were going.”
MacDonald pointed out that corporate sponsorship and advertising is essential to offsetting operating losses at recreational facilities. It’s a challenge for the city, with finite resources, to attract major corporate investment, he said. Nustadia, on the other hand, already has those types of deals in place with many companies like McDonalds and ScotiaBank.
“Nustadia has an entire department devoted to this type of work,” said MacDonald. “Those represent potentially huge advertising dollars for our facility to offset the costs.”
Martensville City Councillor Mike Cox said the MCRC is much more than just another ice surface.
“The facility needs to be operated as cost-effectively as possible,” said Cox. “We’ve tried the sponsorship route in the past and it hasn’t worked great. The whole idea of Nustadia having a division that is totally focused on that is very appealing. We need to make sure our costs are offset, so we don’t have to increase property taxes. We need to explore every opportunity.”
Two Martensville City Councillors, Jamie Martens and Deb McGuire, voted against the motion to enter into contract negotiations with Nustadia.
“In my humble opinion, we are barking up the wrong tree,” said Martens, adding she’s not convinced that contracting out the management and operation of the new facility would be in the interests of residents or civic employees.
Martensville City Council also voted at its November 21 meeting to authorize the city manager to sign a ‘pre-operating agreement’ on behalf of the city with Nustadia Recreation. The pre-operating agreement is entirely separate from the management and operations contract negotiations, and covers the period leading up to the opening of the new recreation facility. Under the pre-operating agreement, Nustadia Recreation will serve as a consulting firm to help the city get everything in place to ensure the facility operates as smoothly as possible once it opens.
“This is really about them helping us get things in place,” said Garost at the November 21 council meeting. “This work, I would suggest, would be contracted out regardless. We don’t have the capacity within our current team to do this work.”
Garost added that there is nothing in the pre-operating contract that obligates the city to continue with an operating contract with Nustadia Recreation once the new facility is open.
Martens said during discussions at the November 21 meeting that she is comfortable with the pre-operating agreement.
“My understanding is this is a consulting contract to get the ball rolling,” said Martens. “I’m in favour of that.”