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The dream of reviving les Nordiques as a proud Canadian NHL franchise is taking a big step forward as Quebec City and the government of Quebec will split the cost of a new arena 50-50, cutting out the federal Tories in a region where they hold six seats.

Quebec City Mayor Régis Labeaume's announcement, planned for Thursday, with Premier Jean Charest represents the "Plan B" he recently promised after negotiations with the Harper government failed to produce a clear funding pledge.

They will jointly unveil the possible location of the arena, as well as a construction timeline. The Conservative minister responsible for the region, Josée Verner, is not invited.

While the 50-50 arrangement does not rule out federal funding at a later date, the new plan could carry a political cost for the federal Conservatives. The party has carved out a small base of support in the region under Prime Minister Stephen Harper but polls show that could shrink considerably if Ottawa refuses to fund the arena.

"The mayor called on them [the federal government]16 months ago and they have not yet responded in a positive way," Mr. Labeaume's spokesperson, Paul-Christian Nolin, said Wednesday. He added that private-sector funding was involved but refused to offer company names or amounts.

The project is moving ahead without a firm commitment from the NHL, which has no plans for expansion. Nor does it have any support from media mogul Pierre Karl Péladeau - the president of Quebecor Inc. - who recently said he would invest "tens of millions" of dollars into the project. Mr. Péladeau also will not be at the announcement.

Mr. Labeaume originally wanted all three levels of government to contribute.

One recent plan called for the construction of a $400-million arena with the province picking up 45 per cent of the cost and the city $50-million. Mr. Labeaume urged Ottawa to contribute the remaining sum.

Eight beaming Tory MPs from the province appeared to literally give the idea of federal funding a thumbs-up in September when they posed for photos in vintage Nordiques jerseys.

But in the months since, comments from the Prime Minister and his government have left broad room for interpretation, with Mr. Labeaume making no secret of his frustration with Ottawa on the file.

Sixteen years have passed since Quebeckers saw their beloved Nordiques leave town for Colorado. Fans of the team have since watched promising young players such as Joe Sakic, Mats Sundin and Peter Forsberg develop into big stars far away from the aging Colisée, now over 60 years old.

The push for a new arena is picking up steam even though NHL Commissioner Gary Bettman says the league has no plans to expand.

"We tell people who are building buildings, don't build it with the expectation you're going to have a team because we're not going to make you that promise," Mr. Bettman told The Canadian Press late last month.

Finance Minister Jim Flaherty has previously confirmed that one option for funding pro sports venues might be through the Public-Private Partnership Fund that Ottawa created in the 2008 budget and still has more than $2-billion remaining.

On Wednesday, in response to a media report, he indicated that another possibility would be to change the gas-tax rules to allow arena funding to qualify. Only hours later, the government's lead minister for Quebec City appeared to shoot down the idea.

"That's speculation," said Ms. Verner, who was front and centre in the September thumbs-up photo. "There's no plan like that."

Ms. Verner repeated her past comments that Ottawa is still waiting on a clear funding proposal. Once that is in place, she said, the federal government can look at which program would best suit funding.

The issue continues to cause headaches for Tory MPs who are trying to reconcile their desire for smaller government with the political reality that several big Canadian cities want federal cash for new NHL arenas or CFL stadiums.

Edmonton-St. Albert Conservative MP Brent Rathgeber said Wednesday the gas-tax idea is worth looking at.

"Some of my constituents are not real keen on public dollars being used; but the gas tax might be a reasonable compromise," Mr. Rathgeber said. "It's a new idea, it's been floated and I think it warrants some consideration."

Ottawa transfers nearly $2-billion a year to municipalities - either directly or through provincial governments - but there are restrictions on its uses. Currently, the money must be spent on one of the following categories: water, wastewater, solid waste, public transit, community energy systems, local roads and bridges, and "capacity development to enable communities to design and implement integrated community sustainability plans."

Municipalities must report to Ottawa on how the money is allocated.

Federal Liberal Leader Michael Ignatieff said changing the gas-tax rules would force city mayors such as Mr. Labeaume to divert money away from infrastructure including sewers to pay for sports facilities.

"What kind of choice is that for Mayor Labeaume?" he asked. "This is not a serious conversation between a federal government and a respected mayor of a Canadian city."

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