Riders rent reduction a 'contractual matter', no legal threat: Reynolds
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The $1.33M rent reduction comes from what the club owed during seasons impacted by the pandemic.
Staff in charge of business operations for Saskatchewan’s junior hockey teams are taking a deep breath after the province committed $4 million to the WHL and SJHL on Friday.
It might be the first sigh of relief Saskatoon Blades president and general manager Colin Priestner has taken in 10 months.
In a world without hockey, Priestner and many other executives have wracked their brains countless times to try and manage the balance sheet.
“You look at a normal season, and attempting to break even is the goal, with playoffs being a big driver in that,” Priestner said.
The 2019-20 WHL season was suspended and eventually cancelled on March 12. The current WHL season has yet to begin due to ongoing COVID-19 restrictions across Western Canada and the United States.
The financial losses are coming from every direction.
Aside from normal operating costs — staff salaries, the arena lease and equipment — there are also dozens of graduating players from previous years going to university at the cost of their respective WHL teams.
Priestner said each player this season is costing his team more than $10,000 per year.
“That’s all coming straight out of the Blades, where normally that would be supplemented by our 50/50 that we get at home games,” Priestner added.
“Scholarships are into the hundreds of thousands of dollars on their own.”
No home games mean no 50/50 fundraisers. Couple those losses with nearly no revenue from season tickets or corporate renewals and the red ink adds up fast.
“The losses are well into the millions for the last 10 months, so this money is going to be very much appreciated,” Priestner said.
The province is providing $600,000 to each of Saskatchewan’s five WHL teams.
The SJHL is getting $1 million, split evenly between the league office and its 12 teams.
League president Bill Chow couldn’t overstate how much that money will help keep the league viable.
“Just the matter of trying to figure out how we can ensure the franchises that are here now are here tomorrow,” he said. “It’s definitely going to make things — not a lot easier, but easier.”
Priestner thinks it wouldn’t be hard to imagine a few teams in the province folding without provincial funding.
“I don’t think that’s an exaggeration at all. You look at some of the smaller markets that are dependent on the community to fund their operations. Take a million-dollar loss over a year and add it to last year’s, there’s not a lot of small-market community towns that can keep a team afloat like that,” he said.
Chow said volunteers and passionate hockey fans across the province have found a way to keep teams operating in the past.
The SJHL started the 2020-21 season but announced on Nov. 25 it was pausing the campaign due to measures the provincial government had enacted to limit the spread of COVID-19.
Chow noted his submission to the province for funding included estimated losses of $150,000 to $200,000 per team in 2020.
“The costs of operations right now are astronomical compared to the no revenue we have coming in,” Priestner said.
Could those “astronomical costs” associated with modern junior hockey mean a change to the formula is coming in the future? Regina Pats chief operating officer Stacey Cattell doesn’t think so.
“The COVID-19 pandemic has been devastating on a number of organizations,” he said. “From clothing stores (and) restaurants — you name it — we’re all suffering through it. (We) just keep people employed and try and keep our businesses viable.”
Still, the questions loom in an industry in which losing money was acceptable and breaking even was celebrated prior to the COVID-19 pandemic. Once hockey resumes with large crowds, changes might need to be made.
“There’s going to be a lot of things we’re going to have to look at,” Priestner said. “What does the average WHL or SJHL team look like operationally starting next season?”
While the answer to that question might not be realized anytime soon, $4 million from the province ensures Saskatchewan’s junior hockey teams will be around to explore answers in 2021.