Quote:
Originally Posted by BigThief
Calgary Sports and Entertainment is spending $40 million up front, hell of deal.
That's not income, that's loan repayment.
This is the actual revenue the city will receive for their half a billion dollars up front cost.
Amazing.  |
No, it's not loan repayment - the city isn't lending CSEC any funds. It's revenues, generated from a ticket tax. It can be used to pay back a loan, if they borrow for the initial outlay, but it isn't a loan repayment.
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The city will use the ticket tax, known as a “facility fee,” as a measure to recoup the city’s $515-million tab to build the event centre block. Overall, Calgary Sports and Entertainment Corp. will pay the city $17 million annually — $7 million coming from rent payments and $10 million from ticket tax revenues. (A one per cent escalation cost will be added each year.)
The annual payments from CSEC to the city are guaranteed, regardless of ticket demand, said Michael Thompson, general manager of infrastructure services at the City of Calgary.
“If ticket demand goes up or down in the future, if naming rights go up or down in the future, the city gets that consistent and reliable $17 million escalating at one per cent,” Thompson said.
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