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Carrie Tait and Allan Maki lift the veil of secrecy on the fiery negotiations between Calgary's mayor, council and Flames ownership on a new facility

The Scotiabank Saddledome is Calgary’s most recognizable building, but attempts to replace it show conflicting visions of Calgary’s future.

On July 28, the president of the Calgary Flames wrote a letter to the city's mayor. The hockey club wanted something it had never had and felt it badly needed: a private meeting between the NHL team's owners, the mayor and city council to explain the Flames' position in negotiations over a new arena.

And so the parties gathered behind closed doors at City Hall three days later. The meeting began and ended with handshakes. In between, it was tense, peppered with barbs, interruptions and threats. An uncomfortable silence brought it to a close.

"You could have heard a piece of dust fall," said Diane Colley-Urquhart, a local politician running for her seventh term as a councillor in Calgary's municipal election on Monday. "It was over."

The fervour of that meeting, which happened roughly six weeks before the team walked away from the negotiations, hasn't dissipated and the fallout will influence the entire city – physically, financially, and psychologically – for decades.

The stalled arena negotiations are about more than who should pay to replace the Scotiabank Saddledome, which is Calgary's most recognizable building. It is about Naheed Nenshi's style throughout his seven-year tenure as Calgary's mayor and how his personality affects his re-election campaign. It is about the city's changing demographics. And it is intertwined with the 2026 Winter Olympic Games, which Calgary is considering bidding on.

The fight over an arena in Calgary's Victoria Park encapsulates a debate cities around the world have over what spurs development, attracts businesses and enhances lifestyles.

"Due to the significant impact of success or failure in moving this project forward, it is important that all stakeholders including council have all the facts with which to make this important decision," Ken King, president of the organization which controls the Flames, wrote in his July 28 letter. "We do not wish to negotiate with city council during this meeting but rather inform.

"The meeting will afford council and Calgary Sports and Entertainment Corporation an opportunity to understand each other's position and opportunities to move forward," said the letter, obtained by The Globe and Mail.

A handful of people who participated in the July 31 meeting have described it to The Globe. Further, individuals on both sides of the debate have made public comments about the private gathering since the warring camps started negotiating publicly in September.

The evening meeting began in council's new boardroom. Mr. King stood on the podium and did most of the speaking on behalf of the Flames. The owners sat on the periphery of the room. Flames' executives, city bureaucrats, and the mayor's chief of staff were also there.

Tension escalated when the mayor and some councillors challenged the Flames' financial calculations and the fact the club refused to open its books throughout the negotiations. Mr. Nenshi, in particular, pressed the ownership group. Then it got testy between him and Murray Edwards, the billionaire oilman who is the most powerful member of the Flames' owners.

"Both the mayor and Murray are snipers," one of the sources said. "The little shots and the interrupting and stuff – yes … definitely it was between both of them."

Calgary Mayor Naheed Nenshi speaks to reporters in Calgary, Alta., Thursday, Oct. 5, 2017.

Other participants in the meeting echoed this analysis of Mr. Edwards and Mr. Nenshi. "It wasn't angry, but it was snappy," another source said. "And both of them are totally like that."

Ms. Colley-Urquhart's recollection of the tone is similar except she remembers it as being one-sided. "I just found that the way Murray Edwards was treated was disrespectful and condescending," she said. Druh Farrell, another municipal politician seeking her sixth term at city hall, described the exchanges as tense but said council was "respectful" and the mayor was "remarkably restrained."

The descriptions of Mr. Nenshi interjecting and perhaps agitating are consistent with his style, which is now a ballot-box issue. Mr. Nenshi's challengers are trying to exploit his freewheeling approach, arguing the stalled arena negotiations prove his running commentary is harmful to the city.

"He hasn't had that before," said Brian Pincott, a three-term councillor who is not running in this election. "Naheed is outspoken about his opinions," Mr. Pincott said of the two-term mayor. "That rubs some people the wrong way and it rubs some people the right way."

Bill Smith, former president of the now-defunct provincial Progressive Conservative Party, is Mr. Nenshi's greatest threat. While Calgary's polls have been wildly inconsistent, next week's result is expected to be tight.

Mr. Nenshi knows the election is, in part, a referendum on his personality, but he makes no apologies for his approach. "Since when in Alberta politics is it bad to be scrappy?" Former Alberta premiers Ralph Klein and Peter Lougheed, he argued, were scrappy. Those former leaders are widely respected in Alberta.

"I stand up to bullies," Mr. Nenshi said in an interview.

The incumbent acknowledges his approach may irritate some people but he would rather come off combative than sanitized by spin doctors. "I don't mean to hurt anyone's feelings, but I believe in evidence-based decision making."

And in a debate, Mr. Nenshi said, he's willing to concede he's wrong. "I'm always happy to change my mind."

Mr. Nenshi declined to discuss the content of the July 31 meeting because it was behind closed doors. Mr. Edwards instructed Mr. King to handle inquiries.

The hockey club knows the arena has been politicized. "This election-issue thing – of course this is an election issue," Mr. King said at a news conference last month. "We did not raise this as an election issue."

He has repeatedly said the Flames are not playing politics.

Murray Edwards is a billionaire oilman who is the most powerful member of the Flames’ owners.

"We're in sports. We're an entertainment business," he said at a September news conference. "We have to keep our mouths shut when it comes to politics. That's how that should be."

However, all but one of the sources interviewed for this story said the Flames were stirring the political pot at the July 31 meeting.

"The election was brought up repeatedly," Ms. Farrell said. "You don't bring up the fact that you're walking from the table and the election in same meeting without it being perceived as a threat."

On the flip side, some councillors told the Flames they were confident Calgarians opposed handing the club bales of taxpayer money because that is what constituents were telling them as they knocked on doors, according to three sources. The Flames, one participant said, were the ones misreading the political landscape.

Mr. King declined to comment for this story because, he said, any statements could be interpreted as negotiating tactics. To the Flames, it is over.

Matt Patterson, a sociology professor at the University of Calgary who researches urban centres, said the arena drama reflects the city's shifting makeup. "As Calgary grows bigger and grows more diverse, there's less consensus that hockey and that the Flames are as important to our sense of civic identity as they were in the past, which means people are less willing to make sacrifices for them in terms of public money and public resources."

The city and the Flames have taken turns releasing bits of their proposals since Mr. King said the club was done negotiating.

The city started with its $555-million proposal. Calgary, the offer said, would cover the equivalent of $185-million, which includes the cost of land and the cost to demolish the Saddledome; the Flames would contribute $185-million in cash; and the final $185-million would come from a ticket tax spanning 35 years and financed by the Flames.

The club, in response, released its proposal for a $500-million project: $225-million from the city in exchange for the Flames contributing $275-million upfront, which would be "similar to prepayment of rent for 35 years of tenancy."

Calgary, in turn, argued the Flames' depiction of its offer was inaccurate. The Flames' latest $275-million portion consists of $100-million cash, a $150-million ticket tax financed by the city, and another $25-million from a "source of which was not clarified," the city said. Further, the city argued the Flames accounting does not consider the $55-million cost associated with land and tearing down the Saddledome.

The Flames' disclosure also excluded the sweeteners the club demanded, such as free transit for people holding tickets to major events at the arena, a slice of parking and casino revenue that now belongs to the Calgary Stampede, and other expensive goodies contained in a February offer letter and term sheet obtained exclusively by The Globe and Mail. The club, for example, insisted the city pay for flood insurance and a plaza suitable for festivals near the new complex. The owners also demanded an exemption from property taxes. The Flames imagined a 19,000-seat event centre and a 5,000-seat practice facility, according to the February letter. The owners have never released a concept plan.

Mr. Nenshi said the Flames' subsequent offer varied little from the proposed February deal; Mr. King in an interview said discussions continued and settled at "quite a bit different place" compared to the February proposal, but he will not say what changed.

How Calgarians respond to the fight has become a cultural identifier. "You are kind of signalling the kind of Calgarian you are," Mr. Patterson said. "You are standing up for the hockey team or you are standing up to the hockey team."