REAL asking city council for 5x funding bump in next year's budget

Regina Exhibition Association Limited (REAL)is asking Regina city council for more than five times as much money in next year's budget as it receivedlast year.

The organization's president says REAL's financial problems need to be addressed but also saysit'sa conversation that won't be easy.

The city had been funding REAL with $1.1 million per yearfor the last three years. NowREAL wantsmore than $5.8 million.

In May, the city contracted MNP to conduct an independent financial review for REAL. The reportsays REAL's current model will increase its operating loss.

"MNP does not believe that REAL will be able to operate on a full break-even on operation in the future," it says.

That also hampers the organization's ability to curb its debt of more than $17 million.

WATCH|REAL asking city council for 5x funding bump in next year's budget:

REAL asking city council for 5x funding bump in next year's budget

10 months ago

Duration 2:22

The city had been funding REAL with $1.1 million per year for the last three years. Now REAL wants more than $5.8 million.

REAL's annual financial statement said it lost of $5.1 million in 2022, its second worst year behind2020, when it lost $5.6 million.

The average number of full-time employees in 2018 was 243. In 2020, that had fallen to a low of 176.

REAL now has 216 employees.

While REAL has inched toward its pre-COVID-19 numbers for full-time staff members, its part-time staff is down to 220 from 474.

To break even with its current staffing levels, REAL will have to increase revenues from profitable activities by 90.8 per cent from the current levels, according to the report.

"If fixed labour is reduced by 50 per cent in 2023, only a 51.8 per cent revenue increase is required from the profitable activities," it says.

The report says some 99.3 per cent of REAL's revenue from last year came from the city and province's pockets. Out of the provincial funding, roughly 98.3 per cent comes from a casino grant that expires in 2027. Beyond that, the report said, REAL will have to scale up significantly in order to stay afloat.

"REAL would need to host an equivalent of more than 4 to 7 Grey Cups per year, according to the financial performance of the Grey Cup event in 2022," the report says.

Council's executive committee is set to discuss REAL's request at its meeting Wednesday. City administration will be also be tabling an updated 2024 proposed budget on Wednesdayahead ofcouncil's budget deliberations next month.

REAL said the increase its asking forrepresents less than one per cent of what REAL contributes to the provincial and city economies.

I think it's a reality that this is a conversation we've needed to have for a number of years and I think it's coming to a head.-Tim Reid, CEO, REAL

Last week, council voted unanimously to remove Tourism Regina from REAL's portfolio.

Tim Reid, the president and CEO of REAL, said COVID-19has changed the organization's business model, and that needs to be addressed.

"I think sometimes we hope that the profit sectors at REALwill allow us just simply not to pay for things that we would pay for in other places. I would love to see that come back. I don't know that it ever will. Foundationally, we need to probably embrace the fact that the business of REAL has changed."

Reid said he doesn't like going to the city council to ask for money, but that's the situation that REAL has found itself in.

"I wouldn't say that this should ever be an easy discussion. I think it's a reality that this is a conversation we've needed to have for a number of years and I think it's coming to a head," he said.

MNP declined CBC's request for a comment.