[News] New Arena - Plan B - Victoria Park

[Tinordi]

Municipal taxpayers are not a bank. There are many banks out there to borrow money from. Use one of them.

Using the city's balance sheet in this way is not a victimless crime. There are huge infrastructure demands for projects that actually make the city work better and that wouldn't be built any other way. City bonds and their coupon advantage should be utilized for these projects because it will mean higher costs for actual projects the city needs. Conversely, why doesn't CNRL issue some corporate paper to pay for the arena? Similar financing costs and they bear the repayment, interest rate, and others risks.

[OldDutch]

Originally Posted by Locke

Then perhaps their commentary on his abilities should be equally as specific.

The fact of the matter is that Burke has been an NHL Executive and more or less involved in Hockey since 1977.

Some reporter who wasnt even born at that time isnt really competent to comment on what Burke does and doesnt know.

Because one thing we've seen from Burke is that when hes acting the blowhard hes doing just that, acting. His words and actions always have purpose.

Hes the Lawyer in a Courtroom. Always.

I thought the article was specific. That he made comments that positively framed the stadium deals in Manitoba and at the same time belittled Calgary for arguing otherwise. While I didn't like the tone the author used (seemed a little Vice-ish to me), he did spell out a few areas where Burke was dead wrong.

Yes he is smart, yes he is educated. I never said otherwise. I said he can be an uneducated blowhard. His rant proves that. It was full of misleading and downright false information packaged up in forceful rhetoric. Now maybe he does know the facts on Winnipeg, or that Calgary does not need a rejuvenated downtown, or that Quebec City is factually a worse market than Calgary, or that negotiations are in the final strokes.

Why would he do that however? If he was willing to say anything at the expense of his credibility, and knowingly lie and mislead so his bosses can have a better shot at an arena deal he is one loyal SOB. I wouldn't do that, but hey kudos to Burke who would clown himself for his boss.

I'll take the former, that he can be a Buffoon with a short fuse sometimes. As such I think he and all people displaying such behavior deserve to be called out.

[Zarley]

Originally Posted by Tinordi

Municipal taxpayers are not a bank. There are many banks out there to borrow money from. Use one of them.

Using the city's balance sheet in this way is not a victimless crime. There are huge infrastructure demands for projects that actually make the city work better and that wouldn't be built any other way. City bonds and their coupon advantage should be utilized for these projects because it will mean higher costs for actual projects the city needs. Conversely, why doesn't CNRL issue some corporate paper to pay for the arena? Similar financing costs and they bear the repayment, interest rate, and others risks.

Municipalities in Alberta do not issue their own bonds, as is common in other jurisdictions. All borrowing for public projects is funneled through the Alberta Capital Finance Authority which allows for access to low rate borrowing. The ACFA has a much higher ceiling for borrowing than the city would on its own and it typically issues debt on a project basis. In reality, borrowing for this project would not impact financing of other projects in the way you describe.

[Tinordi]

This makes my argument even more relevant, because Calgary can't issue its own bonds it's subject to provincial debt limits. Which means that Calgary can only issue debt at 1.5 times it's revenue. Which is a soft cap. The new arena will not bring new revenue which means that the amount by which Calgary can borrow for needed projects is the net amount from the arena.

So far from being a victimless crime, there is a very clear opportunity cost to the city for loaning money for the ticket tax. It means other projects such as a field house would be strained for financing.

[Zarley]

Originally Posted by Tinordi

This makes my argument even more relevant, because Calgary can't issue its own bonds it's subject to provincial debt limits. Which means that Calgary can only issue debt at 1.5 times it's revenue. Which is a soft cap. The new arena will not bring new revenue which means that the amount by which Calgary can borrow for needed projects is the net amount from the arena.

So far from being a victimless crime, there is a very clear opportunity cost to the city for loaning money for the ticket tax. It means other projects such as a field house would be strained for financing.

Nice attempt to spin your way out of an uniformed comment, but:
a) the debt limit is actually 2x revenue - for Calgary somewhere in the $7 billion range (the City has a far lower internal cap)
b) this project would put the City nowhere near that, but even so the limit can be exceeded on a project basis subject to provincial approval,
c) the vast majority of public projects do not bring in new revenue (ie, they are not profitable - that's why they are public and not private sector)
d) risk to the arrangement lies in the details - a payment structure could be agreed upon that allocates risk to CS&E, not the City

It's obviously not a good idea for the City to keep racking up municipal debt and the organization needs to become much more efficient than it is, but acting as if backstopping a ticket tax will put the City in a precarious financial position is simply spreading misinformation.

[Makarov]

^ To me, the biggest problem with a ticket tax is that it will (I think) require the City to own the arena. Outdated arenas (which it will be 20 years after it is built) are probably liabilities, not assets.

[442scotty]

Why not just run a lottery to fund it over x number of years as required. Certainly that would solve everything...

[RM14]

Originally Posted by Makarov

^ To me, the biggest problem with a ticket tax is that it will (I think) require the City to own the arena. Outdated arenas (which it will be 20 years after it is built) are probably liabilities, not assets.

Liability is a big deal. But, at least the City would maintain ownership of prime land. In that neighborhood it will be worth ridiculous amounts in 4 or 5 decades if they needed to sell it.

[bizaro86]

I don't object to the veiled threats of moving for emotional reasons, I just think it's disrespectful to the intelligence of the public, with whom the Flames are negotiating. Anybody with an ounce of intelligence who has followed the league slightly would realize the Flames in their current building are well in the top half of markets, and no market without a team would be better.

Making a threat with no backup just makes you look foolish.

[Makarov]

Originally Posted by RM14

Liability is a big deal. But, at least the City would maintain ownership of prime land. In that neighborhood it will be worth ridiculous amounts in 4 or 5 decades if they needed to sell it.

Fair point.

[VladtheImpaler]

Originally Posted by OldDutch

Good to know. Next time I need health advice I will go see him. He's a Harvard man, and as such is educated enough to provide sound reasonable advice on everything!

Ah, but did he stay at the Holiday Inn Express?

[Thunderball]

Originally Posted by bizaro86

I don't object to the veiled threats of moving for emotional reasons, I just think it's disrespectful to the intelligence of the public, with whom the Flames are negotiating. Anybody with an ounce of intelligence who has followed the league slightly would realize the Flames in their current building are well in the top half of markets, and no market without a team would be better.

Making a threat with no backup just makes you look foolish.

Flames ownership has been remarkably tone deaf recently, especially with their talk of relocation.

In the here and now, its not a viable threat. What they should be calmly noting is that if there isn't a replacement for the Saddledome in 10 or so years, relocation might actually be a risk since the facility might actually be losing money at that point, and be too expensive to fix.

[shermanator]

Don't know if this will go anywhere, but a couple of US Senators are introducing a bill to stop the use of municipal bonds for the purpose of building new stadiums.

http://www.espn.com/espn/story/_/id/...-fund-stadiums

A group of politicians who are tired of taxpayer money being used to build sports stadiums on Tuesday will introduce a bill in the Senate to prohibit the practice.

Cory Booker, D-N.J., and James Lankford, R-Okla., are sponsoring a bill that would prohibit teams from using municipal bonds, whose interest is exempt from federal taxes, to help finance stadium construction.

"Professional sports teams generate billions of dollars in revenue," Booker said in a statement. "There's no reason why we should give these multimillion-dollar businesses a federal tax break to build new stadiums. It's not fair to finance these expensive projects on the backs of taxpayers, especially when wealthy teams end up reaping most of the benefits."

[bizaro86]

Originally Posted by Thunderball

Flames ownership has been remarkably tone deaf recently, especially with their talk of relocation.

In the here and now, its not a viable threat. What they should be calmly noting is that if there isn't a replacement for the Saddledome in 10 or so years, relocation might actually be a risk since the facility might actually be losing money at that point, and be too expensive to fix.

I'm less confident about the 10-20 year picture, since it depends on the economy/oil prices. But I think as it stands now, paying cash for a new building would be more economic than moving, especially if the league cin tines to charge a relocation fee.

[kevman]

Originally Posted by HOWITZER

Oh I know that the team will want to impose a ticket tax. What I'm saying is that as a taxpayer I'd be willing to put up cash to get the building built so that people who can't afford season tickets at higher rates can enjoy Flames games and other events without a ticket tax.

You do know chances are ticket prices will go up with a new arena right? Ticket tax or not, look to our brothers north of us, our ticket prices are about to go up.

We, the taxpayers, have the unique opportunity to fund a stadium that will have less seats (but more boxes) reducing supply and drastically increasing prices. So after paying for a new stadium fewer people will get to go and those that do will be paying more.

There have been no shortage of studies presented in this thread that show that there is no economic benefit to a city for financing a stadium. There have been other articles and numbers presented showing why it's unlikely for the Flames to move new stadium or not. Yet we continue to have people falling for this ####. The Flames organization has done a great job of getting people on board without the facts.

[Tyler]

The Flames organization has not done a great job of anything with this arena IMO

[kevman]

Originally Posted by Falclore

I can tell you, I will never step foot in the new $300million dollar library.

But you could and it wouldn't cost you anything. You paid for it and you have access to it.

Fun thought, if the city footed the bill what if it retained a certain number of seats to use for all events as it sees fit? If there were a block of seats available at no cost for those that otherwise wouldn't get to use the venue I could maybe support a portion being publicly funded. You know, like a library, where anyone is welcome.

[Flamenspiel]

nm

[Dr. Pepper]

Happening in 20 mins at the Dome. Anyone else going? I'll be there...

[InglewoodFan]

Saw an article that Brett Wilson was on Global this morning, moaning about how the city is dragging its feet on a deal. And it reminds me - has KK or anyone else at CSEC ever clarified why it took so long for them to present CalgaryNEXT? Maybe I am taking crazy pills, but I have some pretty clear memories of KK going on and on about the great plans he had on his desk at a STH event over 5 years ago. Can someone please ask him why that took so long?