Peterborough city council is being asked to choose from six options for the future of a proposed $170-million Multi-Use Sport and Event Centre, a long-debated arena and entertainment project staff say would replace the aging Peterborough Memorial Centre.
A new report going to council Monday outlines the financial and strategic implications of moving ahead with the Multi-Use Sport and Event Centre, known as MUSEC, at the city-owned former bus garage site on Townsend Street.
The report presents options ranging from ending the project altogether to fully approving and financing construction, with several middle-ground scenarios involving partial city funding, outside partnerships and asset sales.
City staff say the project, first launched in 2018, is intended to replace the 70-year-old Peterborough Memorial Centre, which they say is increasingly costly to maintain and no longer competitive as a modern sports and entertainment venue.
The preferred site for the proposed facility was approved by council last year at 182 Townsend St., in line with the city’s “Downtown First” investment strategy.
Staff estimate the full cost of the project at $170 million, including construction, design and contingencies.
The report says the city can afford to contribute about $30 million under its current debt policy while maintaining room for other capital priorities, including infrastructure and state-of-good-repair projects.
That option, identified as the lowest financial-risk scenario, would require the city to find outside funding partners — potentially from the private sector, other municipalities or senior levels of government — to cover the remaining cost.
Staff say that approach is the most financially sustainable and would have an estimated tax impact of less than one per cent annually.
A second option would see the city borrow the full $170 million by raising its internal debt limit to the provincial maximum. Staff warn that scenario would create the highest financial risk, with annual debt servicing costs of about $10.5 million and a projected tax increase of 4.5 to five per cent.
The report says that approach would also sharply reduce the city’s ability to fund other capital projects and could put pressure on Peterborough’s AA credit rating.
A third option would combine $70 million in debt with $100 million generated through the sale of city assets. Staff say that model would reduce the tax impact to about two per cent, but would depend on identifying and selling significant municipal assets and could reduce future revenue flexibility.
Staff ultimately recommend against full debt financing and say the most prudent path is to determine an affordable city contribution while seeking outside funding.
The report also notes that not replacing the Memorial Centre carries financial and operational risks, including rising repair costs, declining event revenue, and the possibility of losing the Peterborough Petes if the facility can no longer support Ontario Hockey League operations.
The Memorial Centre currently faces $22.4 million in repair needs over the next 15 years, along with a roughly $500,000 annual operating deficit, according to the report.
Staff say a new arena could also act as a catalyst for downtown redevelopment, tourism and economic growth. A consultant’s analysis estimates surrounding development tied to the project could generate $271.5 million in new property assessment by 2040, translating to roughly $7.4 million in additional annual municipal tax revenue.
Council is expected to debate the report and decide how — or whether — to proceed with the project.
(Written by: Jordan Mercier)
