[News] Ken King: Flames' owners no longer pursuing new arena with City of Calgary

[longsuffering]

Originally Posted by GGG

Who pays for maintenance in your poll and do the flames pay rent?

Also would like the option of negotiate a hard line until the day before the flames will agree to move and strike a deal then. Say sometime in 2020.

The poll assumes much the same arrangement as with the Saddledome, the building would be managed by the Flames who would pay all maintenance costs (but not demolition costs at the end of the useful of the building) and receive all arena revenues.

Rent or payment of property taxes is part of the investment recovery mechanism.

I don't want to put a deadline on it. I want to know people's bottom line today.

[GGG]

Originally Posted by Hot_Flatus

Wrong. The city would be footing the entire bill upfront and be scrambling to recover for years if not decades. Deals like the Katz deal show that the ownership group is only going to front a minimal amount like $30M to the entire process. The rest of their share will be conveniently spread out over decades if they get their way (which essentially amount to a billionaires yearly interest earnings).

People love to assume three equal thirds are just magically deposited into an account one day. Tax payers would need to recoup the entire cost of the building ($600M) initially from the current tax budget as the ticket tax would take years to amount to anything as well. This would amount to numerous roadway and transit cuts, who knows how many other public job cuts. The burden on a tax payer goes well beyond the simple dollars and cents on the yearly tax bill (which would be hit much harder than your asinine $50 estimate to maintain current services and projects).

Financing the ticket tax shouldn't have any opportunity cost as our debt ceiling is artificially imposed well below any dangerous point. Provided that the repayment terms and ticket sales projections are reasonable that is a low risk item even if the city is on the hook for default.

Financing the 200 million city contribution again depending on the repayment source is likely a reasonable expense that has no impacts outside of the direct cost of being a 30 year interest free loan (pending release of plan)

The owners in previous proposals were saying 200 million up front cash money.

These items don't seem to harm the city in a financial way outside of the Capital commitment. The 400 million in loans with the city just paying interest on the 200 million share would not have a direct impact on Transit and roads. Your spouting hyberbole undermining the limit public contribution position.

[transplant99]

Originally Posted by GGG

Who pays for maintenance in your poll and do the flames pay rent?

Also would like the option of negotiate a hard line until the day before the flames will agree to move and strike a deal then. Say sometime in 2020.

When is that exactly?

Technically, that option could be used starting tomorrow if the ownership group wanted to go that route.

Moving the club is a long process but once it has begun, there will be no backing out.

[Itse]

I hate this fight. Obviously I have zero cents in this personally, but as a fan I feel I have the right to say this:

F you Ken King and Flames ownership for this stunt.

*sigh* and this was such a feelgood offseason

[GGG]

Originally Posted by longsuffering

The poll assumes much the same arrangement as with the Saddledome, the building would be managed by the Flames who would pay all maintenance costs (but not demolition costs at the end of the useful of the building) and receive all arena revenues.

Rent or payment of property taxes is part of the investment recovery mechanism.

I don't want to put a deadline on it. I want to know people's bottom line today.

For me in the 25%-33% with repayment (probably ok with the city paying interest on this amount without repayment) from the property tax break given to the flames by the city owning the building. Being tax free for the life of the building plus providing financing is a significant value.

So effectively 100 million NPV plus tax free.

[MolsonInBothHands]

Originally Posted by longsuffering

It's hard to quantify because the posters using the emotional argument "the Flames give the City it's identity", etc. aren't very forthcoming about what they think is fair. Not a single one of their posts mentions an upper limit.

I doubt many would confess to be in that camp but they arguably so passionately against the economic arguments that they seem willing to make any deal.

The 1/3 - 1/3 - 1/3 deal is the City's offer. According to Jason Markusoff in Macleans and Twitter sources CSEC's offer is for the City to closer to 50% and return nothing. Is that their bottom line?

That's why I proposed a poll. I'd like to understand everyone's bottom line.

I see passionate arguments from both sides, and it seems to me most agree and support something between the two extremes. I guess I just don't see the need or benefit of trying to label the other side as the extremist. There is a lot of common ground.

[longsuffering]

I'll go on record with my bottom line.

The City provides the site and upgrades the infrastructure in the area - the same type as proposed in Nenshi's video - at their cost.

The City provides a cash grant of $100 million of the construction costs. I could also live with the City providing more initial funding as long as any contributions >$100 million are returned to the City via a revenue sharing mechanism.

ErikEstrada, transplant, New Era, ManhattanBoy, et al. What's your bottom line?

[rubecube]

Originally Posted by Erick Estrada

I can guarantee (lol watch someone dig up something I said years ago doh!) you cannot find a post here of me complaining about money going into a new library despite the fact that I don't use it. I recognize it's not all about me and maybe I'm a minority but I care about the city and I realize my tax money is going to get spent on a lot of things I don't use or care about but I look at what's best for the greater good and having an NHL city IMO is for the greater good of this city.

The difference is that, whether you use it or not, you have the ability to use the library at no additional cost, other than the taxes that went in to building it.

I still haven't heard any stories of families of four in Edmonton that are now hard done by because of the arena. The fact is that it really hasn't impacted anyone negatively in that city as if not spent on the new arena chances are that money goes into something else that same family of four doesn't utilize.

It doesn't necessarily have to be a family of four being hard done by because of the arena or an increase in property taxes. There are also opportunity costs to consider. Whatever the city shells out is money they now don't have to improve, maintain, or build new services that actually do benefit the general public as a whole.

[Lanny_McDonald]

Originally Posted by longsuffering

I'd like to propose a Poll.

4. 33% cash funding of the building design and construction costs with no mechanism in place for repayment of those monies.

The city will ultimately own the building. The Flames are putting up 66% upfront for a building that won't be theirs. Consider that as long term rent. The Flames will also be on the hook for operational expenses and improvements over the life of the building. It really think this is a fair deal for all.

Originally Posted by BurningSteel

What if the Flames threw in a larger scaled peace bridge from the new arena to nowhere??

And had a blue right on top of the roof? How about they also include another library?

[GGG]

Originally Posted by transplant99

When is that exactly?

Technically, that option could be used starting tomorrow if the ownership group wanted to go that route.

Moving the club is a long process but once it has begun, there will be no backing out.

I'd be willing to confidently bet January 2020. If they are selling the team or moving I'd bet that isn't announced until 2022 but I would rather not lose the team pushing that far. Seattle is ripe for an expansion franchise and that can't happen if the flames move there so the flames threat as it stands now is relatively non-existent. In general we shouldn't panic at the first Bettman move. They haven't even brought in Seattle's NHL guy for a tour yet. The Seattle arena isn't approved or built yet. In my opinion Edmonton settled early and go a terrible deal.

Combine that with the fact the ticket market is rapidly changing right now might not even be a good time to build an Arena. I am of the mindset that in about 10 years Arenas will be 8,000-10,000 seat Luxury domes and priced accordingly and the flames will be sitting with the Skydome of NHL arena's the last one to be built before the great revenue shift that will occur when Facebook and twitter bought all the TV rights to the leagues. The value proposition on poor seats is diminishing rapidly.

[Hot_Flatus]

Originally Posted by GGG

Financing the ticket tax shouldn't have any opportunity cost as our debt ceiling is artificially imposed well below any dangerous point. Provided that the repayment terms and ticket sales projections are reasonable that is a low risk item even if the city is on the hook for default.

Financing the 200 million city contribution again depending on the repayment source is likely a reasonable expense that has no impacts outside of the direct cost of being a 30 year interest free loan (pending release of plan)

The owners in previous proposals were saying 200 million up front cash money.

These items don't seem to harm the city in a financial way outside of the Capital commitment. The 400 million in loans with the city just paying interest on the 200 million share would not have a direct impact on Transit and roads. Your spouting hyberbole undermining the limit public contribution position.

It is well known that the city is already using those debt/loan mechanisms within its current structure every year so they cannot simply continue to add what could be $500M at the outset to that. This would put the city in a very dangerous position and set a very bad precedent moving forward. Even low interest on an amount that high would be unacceptable anyway considering how little CSEC will ever have to put up for this current sham of an offer that is allegedly on the table.

There was nothing in the previous proposal referencing $200M upfront from the owners, that is completely false. If you're talking CalgaryNEXT that isn't even up for discussion as it wasn't the same situation at all. The comparable is Edmonton based on what we know and this is the way it went with the Edmonton deal. I've posted these figures before so it is readily available for those with the willingness to read.

[Cappy]

Originally Posted by longsuffering

It's hard to quantify because the posters using the emotional argument "the Flames give the City it's identity", etc. aren't very forthcoming about what they think is fair. Not a single one of their posts mentions an upper limit.

I doubt many would confess to be in that camp but they arguably so passionately against the economic arguments that they seem willing to make any deal.

The 1/3 - 1/3 - 1/3 deal is the City's offer. According to Jason Markusoff in Macleans and Twitter sources CSEC's offer is for the City to closer to 50% and return nothing. Is that their bottom line?

That's why I proposed a poll. I'd like to understand everyone's bottom line.

Perhaps a straight poll - is the 1/3 model fair?

[GGG]

Originally Posted by New Era

4. 33% cash funding of the building design and construction costs with no mechanism in place for repayment of those monies.

The city will ultimately own the building. The Flames are putting up 66% upfront for a building that won't be theirs. Consider that as long term rent. The Flames will also be on the hook for operational expenses and improvements over the life of the building. It really think this is a fair deal for all.

And had a blue right on top of the roof? How about they also include another library?

Can we please stop acting like the city owning the building is for the cities benefit. If you sign a 30 year operating agreement with the flames and give all revenue, maintenance and management of the arena to them. It is their building they just don't have to pay property taxes to the city or the province. Its a 10 million dollar per year benefit to the flames.

City ownership is a city contribution not a flames contribution.

[Flash Walken]

Useless to argue about the details until the proposals are released 1/3 is just the frame work, doesn't speak to scope or details of the project.

[EldrickOnIce]

Originally Posted by rubecube

I've traveled all over Europe. People who know about Calgary generally only know about it as the airport they need to fly into to get to Banff.

Well that settles it then.

[Lanny_McDonald]

Originally Posted by longsuffering

I'll go on record with my bottom line.

The City provides the site and upgrades the infrastructure in the area - the same type as proposed in Nenshi's video - at their cost.

The City provides a cash grant of $100 million of the construction costs. I could also live with the City providing more initial funding as long as any contributions >$100 million are returned to the City via a revenue sharing mechanism.

ErikEstrada, transplant, New Era, ManhattanBoy, et al. What's your bottom line?

I think this is a pretty fair option as well.

[longsuffering]

Originally Posted by New Era

4. 33% cash funding of the building design and construction costs with no mechanism in place for repayment of those monies.

The city will ultimately own the building. The Flames are putting up 66% upfront for a building that won't be theirs. Consider that as long term rent. The Flames will also be on the hook for operational expenses and improvements over the life of the building. It really think this is a fair deal for all.



And had a blue right on top of the roof? How about they also include another library?

Thanks for going on the record. Interesting that we actually don't have a huge difference in the bottom line.

I hope a few of the other most passionate posters go on record - or that a poll is added.

[Cappy]

Originally Posted by New Era

4. 33% cash funding of the building design and construction costs with no mechanism in place for repayment of those monies.

The city will ultimately own the building. The Flames are putting up 66% upfront for a building that won't be theirs. Consider that as long term rent. The Flames will also be on the hook for operational expenses and improvements over the life of the building. It really think this is a fair deal for all.

That's actually fair and, while i think it's too high, i wouldn't call you out on that.

But I beg to ask, the Flames have pretty much rejected this saying 66% (including 33% of ticket tax) was too much CSEC investment.

How do you reconcile your staunch support for the CSEC on this forum, with the fact that you essentially disagree with their "reasonable" offer?

That is a legit question too, i'm not trying to play "gotcha" or anything; it just seems we are having these passionate debates and personal attacks over proposals that the Flames would reject

[GGG]

Originally Posted by Hot_Flatus

It is well known that the city is already using those debt/loan mechanisms within its current structure every year so they cannot simply continue to add what could be $500M at the outset to that. This would put the city in a very dangerous position and set a very bad precedent moving forward. Even low interest on an amount that high would be unacceptable anyway considering how little CSEC will ever have to put up for this current sham of an offer that is allegedly on the table.

There was nothing in the previous proposal referencing $200M upfront from the owners, that is completely false. If you're talking CalgaryNEXT that isn't even up for discussion as it wasn't the same situation at all. The comparable is Edmonton based on what we know and this is the way it went with the Edmonton deal. I've posted these figures before so it is readily available for those with the willingness to read.

We all know the Edmonton deal sucks. By the way are they cutting transit and roads because of all of the financing. To me using the ownerships proposal for CalgaryNext as a starting point for their proposal is pretty reasonable and we can refine as we learn details.

But it is absolute hyperbole that the city can't absorb 500 million in debt financing without affecting other services. They can, full stop. They are no where near the financial borrowing capacity for the city. They are currently approaching their self imposed limit which is well below the provincial limit. It is a non issue. Its like trying to tout economic benefits for the flames. They just don't exist. Neither does the risk you are trying to create. It adds nothing to the debate.

[DFO]

Originally Posted by New Era

4. 33% cash funding of the building design and construction costs with no mechanism in place for repayment of those monies.

The city will ultimately own the building. The Flames are putting up 66% upfront for a building that won't be theirs. Consider that as long term rent. The Flames will also be on the hook for operational expenses and improvements over the life of the building. It really think this is a fair deal for all.



And had a blue right on top of the roof? How about they also include another library?

But isn't this just a handout with zero upside to the City under the assumed CSEC terms (no rent, revenue sharing, or property taxes)?