[GGG]

Originally Posted by JerryUnderscore

I understand the owners not wanting to pay for the arena themselves. After all, if you had the choice between paying full price for a new car or relying on a government subsidy to bring down the price of the car, which would you choose? If the owners can get the government to subsidize the arena I fully expect they will try.

However, it's also in the city's best interest to figure out just how economically viable a new arena will be for the city itself. And it's not surprising that the owners will try to spin the arena as more economically viable than it will be.

The solution, to me, should be in a ticket tax. The city should put up $200M for the arena, but then charge a 5% ticket tax to all events that happen there.

The current average ticket price of Flames tickets is $186.45. A 5% ticket tax (which would average $9.32), would increase the average ticket price to $195.77; hardly noticeable.

However, with roughly 20,000 seats in a new arena, you could bring in roughly $186,400 per home game or $7,642,400 per season for the Flames (assuming no playoffs). Over a 30 year life span for that arena, the arena would bring in ~$230M in revenue, which would pay for their part of the arena.

The Flames alone would pay for the city's investment in the arena. This says nothing for the additional revenue from Hitmen games, concerts or other events.

Furthermore, by taxing ticket sales, the city recoups the money from those who actually use the arena rather than the entire city.

It seems like a win-win really.

The issue there is that is effectively an owner contribution and not a city contribution. As the total money the owners will earn over the life of the arena will be reduced by 3%-5% depending the elasticity of the fee vs face value.