The Ottawa Sports and Entertainment Group is cutting 40 per cent of its staff at TD Place, as COVID-19 and the limits on gatherings continue to hammer the entertainment and sports industries.
Employees were to take part in one-on-one video meetings Wednesday, after CEO Mark Goudie sent out a letter to them saying he's no longer confident in OSEG's earlier plans to "weather the pandemic and keep everyone in place."
OSEG runs the arena and stadium at TD Place and the commercial areas at Lansdowne in the Glebe. It owns the Ottawa 67s hockey team and Ottawa Redblacks CFL team, but sports team staff were not included in the job terminations, according to the letter obtained by CBC News.
"You are an exceptionally talented group and this is not a reflection on your skills, capabilities or commitment…..but rather the harsh result of a brutal pandemic," Goudie wrote.
A longer recovery period
In the letter, Goudie described how OSEG's original planning accepted that it was unlikely it would sell tickets for another event at TD Place in 2020.
In the spring, it cut expected revenues by half, to $25 million, even though its expenses weren't reduced by the same proportion. It hoped to return to some sense of "normal" with events and hockey games by early in the new year, and bring on "three new sports tenants in the spring, summer and fall of 2021."
Extra financial injections from OSEG's owners, plus the federal government wage subsidies would help staff stay on. But now, with cases of COVID-19 rising, and gathering sizes not returning to that normal, Goudie wrote he now had "very low confidence in those assumptions" and OSEG had to make "hard decisions" and issue terminations.
"I believe, despite significant cost containment measures which we have implemented to-date, that our revised financial plan is not achievable and this will result in a longer recovery period that will require even more money to be contributed by our OSEG owners," he explained.
Those whose jobs were terminated will continue to be paid for eight weeks. A smaller team will stay on to work on a plan aimed at seeing OSEG recover.
"As an organization, we can't just survive this pandemic. Daunting as it may appear in this moment, we need to come out of it ready to thrive because Ottawa, our region and our four million plus visitors are relying on us to give them the best Redblacks, 67's and other sports, music and entertainment experiences that we are able to when it is safe to do so," wrote Goudie.
Goudie was not available to comment Wednesday.
City audit followup released same day
Earlier in the day, the arena, stadium and parking garage at TD Place had been the focus of city auditors.
They had raised concerns a few years ago about the contract between OSEG and the City of Ottawa at Lansdowne, namely that the city wasn't properly monitoring the maintenance needed on the structures, nor had formal trust accounts been set up to protect the financial reserves needed for repairs.
A follow up report released Wednesday found only six of 17 recommendations from that 2017 audit had been implemented, while nine others are only partly completed.
"That basically is a F, a failing grade," observed Coun. Carol Anne Meehan, vice-chair of the city's audit committee.
Deputy auditor Sonia Brennan said some 30 long, complex agreements, each with contractual obligations, govern operations and finances at Lansdowne, where the city's parks and recreation department runs the park, Horticulture Building and Aberdeen Pavilion while Ottawa Sports and Entertainment Group runs the stadium, arena and commercial area.
The auditors said while a lot of time might go into setting up such public-private partnerships, they made a new recommendation to push the city to consolidate in-house expertise to manage complicated contracts once they're up and running.