Hockey Saskatchewan MEMO: Participants Legacy Trust Fund
By Hockey Saskatchewan
REGINA, Sask. - A memorandum has been issued regarding Participants Legacy Trust Fund.
- To: Hockey Saskatchewan Minor Hockey Associations, U18 AAA/AA Male and Female Leagues
- From: Kelly McClintock, General Manager
- Re: Participants Legacy Trust Fund
There has been reports in the media alleging that Hockey Canada has a second secret “slush” fund. I want to ensure the members of Hockey Saskatchewan that there is in no way a “slush” fund.
Within the annual Executive Summary/Discussion of the Hockey Saskatchewan Audit Financials circulated within the Annual General Meeting Booklet and posted on the Hockey Saskatchewan website, the Participants Legacy Trust Fund is explained.
The amount Hockey Saskatchewan receives annually from the interest earned on the Participants Legacy Trust Fund is also detailed.
The Participants Legacy Trust Fund is not a fund of Hockey Canada but rather the Members of Hockey Canada of which Hockey Saskatchewan is one of the thirteen members.
From September 1986 to August 1995 Hockey Canada could not obtain an insurance provider and was essentially “self-insured”. Fees collected from participants registered with members (approximately $18 per participant at that time) were placed into the National Equity Fund and used to cover expenses for lawsuits primarily in the areas of injury lawsuits (example: people who experienced paraplegic or quadriplegic injuries; spectators being hit and injured by pucks, etc.).
Background Info re: CAHA Legacy Trust
On June 1, 1999, approximately $7.1 million was transferred from the Hockey Canada National Equity Fund into a formal Legacy Trust Fund (“Trust”). The Trust belongs to the original contributors of the self-insured period, based on their level of contributions. This Legacy Trust fund continues to exist today and provides annual funding to Members of Hockey Canada and the CHL by way of realized annual investment income. The income is distributed to Members and the CHL based on the percentage they originally contributed into the Trust. Since 2007, realized income of $5.4 million has been paid out to Members/CHL from the Trust.
Hockey Saskatchewan collected the following amounts for the past five years from the interest earned on the Participants Legacy Trust Fund:
This revenue assists Hockey Saskatchewan to maintain the current fees charged to participants in the province.
The following table shows that percentage breakdown of the original contributions:
In addition to providing Hockey Canada Members with a stable source of annual funding, the Trust also acts as a backstop to the National Equity Fund, and protection for the Members against any liability claims which ensued from incidents that occurred from September 1986 to August 1995 (the self-insured period). Should the National Equity Fund be insufficient to service such claims, the Trust would be required to fund them through a “tail coverage agreement”. This trust belongs to the beneficiaries of the Trust (listed above) and as such does not appear on Hockey Canada’s financials.
The Member Branches of Hockey Canada endorsed the continuation of the Participation Legacy Trust fund within the past three years to serve as “tail coverage” in the event any type of lawsuit is launched against a Member Branch from the period Hockey Canada was “self-insured”.
Therefore the Participants Legacy Trust Fund provides annual revenue to Hockey Saskatchewan while at the same time providing coverage in the event of a lawsuit having to be paid out from that time period which may result in fees having to be increased for the current members.
Hockey Canada is merely the settlor of the Trust, with Paul Delparte, Brian Cameron, Brian Cairo, and Scotia Trust acting as Trustees.