Canadian Government Won’t Subsidize Teams

Less than 72 hours after announcing it would help subsidize the NHL’s six Canadian teams, the Canadian government on Friday bowed to widespread public protests and withdrew the bailout plan. The stunning turnaround cast doubts on the prospects of several teams remaining in Canada, where they face heavy tax burdens and an unfavorable currency exchange rate.

“I’m obviously disappointed by the recent developments and I remain concerned,” NHL Commissioner Gary Bettman said. “This is an appropriate time for us to regroup and reassess where we are. We and the six Canadian clubs are committed to doing everything in our power to keep them in Canada. I’m not as optimistic today as I was on Tuesday.”

The aid package, which would have given about $3 million a year through the 2003-04 season to Canadian franchises that also secured help from municipal and provincial governments, ignited outrage among politicians and citizens who saw it as a handout to rich owners and players. “We now have clear, negative views from the public, the provinces and many of the municipalities,” Industry Minister John Manley said. “Therefore, I am announcing today, on behalf of the federal government, that this proposal is dead and we will not be pursuing the issue any further.”

The NHL has given Canadian franchises more than $40 million over the last four years through its Canadian Assistance Plan, which was targeted to put small-market clubs on a more solid financial footing. The plan was renewed for five years in December predicated on the Canadian government also providing assistance; with that no longer in the offing, Bettman said he will go back to the Board of Governors to discuss a new framework for a one-year deal.

Bettman also said keeping the six existing teams in Canada, home of the vast majority of NHL players, “is vital to us.” However, Ottawa Senator owner Rod Bryden, who was entertaining offers from U.S. interests but said he removed the “For Sale” sign when Canadian aid appeared imminent, said he might bring the sign out again. “It’s still in the garage but it’s probably useful we didn’t bury it,” Bryden said.

Two Canadian franchises moved to the United States in the last five seasons. The Quebec Nordiques were sold and relocated to Denver as the Colorado Avalanche in 1995, and the Winnipeg Jets were sold and moved to Phoenix in 1996.