There are some issues between the City of Hamilton and the Hamilton Urban Precinct Entertainment Group (HUPEG) regarding HUPEG meeting deadlines within the Master Agreement between the entities.
Council spent over 150 minutes in closed session on Wednesday discussing the issues. They returned to open session and voted 11-to-5 against disclosing the concerns.
Five councillors voted for a public release of information: Maureen Wilson, Cameron Kroetsch, Nrinder Nann, Brad Clark, and Alex Wilson.
“I’ve been saying since the beginning, I think everything about this should be made public,” Clark stated. “Everyone has a right to see what’s happening with these public dollars, and I’m going to be voting against keeping this information confidential. And I think it’s important for us to be transparent. I’ll leave it there.”
HUPEG Late on Convention Centre and Annual Donations to the Art Gallery of Hamilton
Council did discuss two issues of non-compliance already known to the public: delays in beginning the renovation of the Convention Centre, and delays in making a required annual donation to the Art Gallery of Hamilton.
In June 2021, the past Hamilton City Council approved the Master Agreement with HUPEG.
The agreement’s main component is a 49-year lease requiring HUPEG to upgrade, maintain, and operate Hamilton’s three municipal entertainment facilities: the arena formerly known as Copps Coliseum, the Hamilton Convention Centre, and the Hamilton Place concert hall.
The agreement also includes “transacting” three prime downtown properties to HUPEG, which HUPEG will be able to redevelop into residential towers, subject to terms and conditions that are not publicly known.
In August 2022, the past Council approved the HUPEG and Oak View Group (OVG) agreement that brought the multinational corporation to the project. OVG brings the financing and expertise to the overall project.
The renewal of the former Copps Coliseum is underway at an estimated private-sector cost of $280-million.
This exceeds the Master Agreement requirement of $50-million in immediate renovation work.
Convention Centre Delays Due to Arena Focus and City Cybersecurity Failure
On Wednesday [September 4, 2024], following the closed session meeting, Maureen Wilson, in open session, requested City staff to elaborate on the Convention Centre delays.
“The convention centre has been a little delayed in terms of preparing all of the documentation to get into the building department for their approvals,” stated the City’s head of real estate Ray Kessler, in response to Wilson’s question.
The Master Agreement requires the renovations to be completed by December 31, 2024. Kessler says it will be done by the end of 2025.
Speaking with TPR after the council meeting, HUPEG President PJ Mercanti says they’ve been focused on the arena project.
“The priority from the get go has been to make sure that the arena project gets off to the races,” he said. “That has the major focus for the public, for council, for City Hall, for HUPEG.”
“We were doing everything in our power to make sure that that train left the station. That was the primary focus on energy. We were transparent with the City the whole time and provided them with updates on where we’re at with the Convention Centre.”
Both the City and HUPEG say the City’s February cybersecurity failure has delayed building permit approvals.
The Convention Centre’s renovation will be phased, the building will remain operational, and significant events, such as Soupfest and the YWCA Women of Distinction Awards, will continue at the venue.
Mercanti says work that did not require building permits is already underway.
$100,000 Per Year to Art Gallery Not Yet Paid
The Master Agreement states HUPEG will donate $2-million dollars to the Art Gallery of Hamilton, in $100,000 annual sums each year for twenty years.
Maureen Wilson asked staff to provide a public update on this issue, and why the payments have not yet been made.
“HUPEG and the Art Gallery are in dialogue around what that contribution agreement looks like,” Kessler said. “They do have the obligation under the master agreement to deliver that … believe that’s just a matter of it being delayed” as the parties reach their agreement.
Broader Concerns Hinted at in August
At the August 12 Council GIC meeting, Ward 9 Councillor Brad Clark asked HUPEG’s Louis Frapporti:
“My question would be to the chair of the Hamilton Urban Precinct Entertainment Group as it stands today. Can you advise us if HUPEG is fully compliant with the master agreement and the lease?”
Frapporti, who is a lawyer at Gowling WLG and stated he was representing HUPEG, responded:
“I’m not the chair of HUPEG. Mr. [P.J.] Mercanti is the Chair and President of HUPEG. I’m not in a position to speak to those issues. He would be in a position to speak to those issues. And he’s not here today.”
Because Council has voted to keep any concerns confidential, Clark is prohibited from saying what (if any) specific concerns he had, or if they’ve been addressed.
Council to Consider Matrix for Future Public Release
At the end of the Council meeting, Maureen Wilson successfully moved a motion to “to instruct staff to give thought to and production of an evaluative framework or matrix. They would bring that back. And within that framework, staff would have populated it with things that we would want to account for publicly on the measure of this agreement.”
The motion passed unanimously.
Production Details v. 1.0.0 Published: September 9, 2024 Last updated: September 9, 2024 Author: Joey Coleman Update Record v. 1.0.0 original version
$100,000.00 that is what a $100,000.00 looks like, though I suppose both the Art Gallery and Council know that. What penalties are in place for this payment default? I assume we are collecting interest on this failed payment.