CalgaryNEXT Discussion pt. 2

[Enoch Root]

Originally Posted by Parallex

I didn't say that you weren't.

RE: ticket tax. In the sense that it'll (eventually) come out of the demand derived ticket price revenue sure. But it won't contribute one dime to the actual construction of the project. Hence why I said the amount they're willing to front is remarkably tiny. Heck, when you get right down to it the it's not like the owners are really foregoing that exact amount of money on the ticket tax considering that a significant portion of it would go to the players as part of HRR and another couple of chunks would go to provincial and federal tax coffers. It's not exactly a big give when yo get right down to it.

It's the language they use that I dispute not the ultimate downstream source of the funds. They could have just as easily said "The City will contribute X, CS&E will provide Y, and the City will receive revenue streams with an anticipated value of Z over the life of the facility".

Yes it would.

The ticket tax is a revenue stream. That revenue stream would allow for a bond to be issued, which would raise the $200M (and be used for construction). The ticket tax would pay off the bond.

Side note: my understanding was that the ticket tax would pay principal and interest. Where is it stated that the city would be expected to pay the interest on that bond? That makes no sense (and of course the city wouldn't do it). What is more likely to me is that the city would guarantee it. Big difference.

[Kavvy]

Originally Posted by Enoch Root

Yes it would.

The ticket tax is a revenue stream. That revenue stream would allow for a bond to be issued, which would raise the $200M (and be used for construction). The ticket tax would pay off the bond.

Side note: my understanding was that the ticket tax would pay principal and interest. Where is it stated that the city would be expected to pay the interest on that bond? That makes no sense (and of course the city wouldn't do it). What is more likely to me is that the city would guarantee it. Big difference.

Can't answer that, and very good point... except, I was wrong before, the ticket tax isn't just a Calgary Flames donation, it is a user fee applying to all events.

Granted the Flames make up the majority of the events I would assume, it still isn't 250mill from them

[Cappy]

Originally Posted by Mr.Coffee

I think vague arm-wavy notions about culture are fine too, because absolutely that's true. So what's the value of that culture? Is the cost of culture this enormously lopsided deal?

No.

I agree with this. I totally support professional sports and stadiums, when done correctly (which i personally don't think is the case with CalgaryNEXT, but I think was done well in Edmonton) can utilize public funds for certain reasons.

But the cultural and emotional aspect, atleast to me, is not worth the amount the team is asking for.

[saillias]

Someone let me know when they submit a proposal that's not 3 kids in a trenchcoat. I will PM you a pizza.

[Cappy]

Originally Posted by saillias

Someone let me know when they submit a proposal that's not 3 kids in a trenchcoat. I will PM you a pizza.

https://youtu.be/nYscs78R5Fs?t=13s

[Bingo]

I honestly think the discussion about the Flames funding model itself is a little premature until the city decides they want to do the thing and counters with a model of their own. Now that Nenshi is all pumped up about the olympics I think we may see something in that bane soon, and then the real discussion will start.

Right now it's just Gaudreau's agent saying 8.5 per year with nothing from the other side.

That group of business men are wise enough to not expect the city to just yell done and take the structure as it stands.

[Table 5]

Originally Posted by Bingo

I honestly think the discussion about the Flames funding model itself is a little premature until the city decides they want to do the thing and counters with a model of their own. Now that Nenshi is all pumped up about the olympics I think we may see something in that bane soon, and then the real discussion will start.

Right now it's just Gaudreau's agent saying 8.5 per year with nothing from the other side.

This line of thinking assumes that this is a negotiation. The Flames are the ones who need a new hockey rink or football stadium, not the City. The City already had plans for a fieldhouse and rejuvenation of the West Village, and could do it without any Flames involvement whatsoever.

The Olympics do present an interesting wrinkle, but at the end of the day in regards to a new rink/stadium, the Flames need the City much more than the other way around. The onus is on the Flames to woo them.

[Bingo]

Originally Posted by Table 5

This line of thinking assumes that this is a negotiation. The Flames are the ones who need a new hockey rink or football stadium, not the City. The City already had plans for a fieldhouse and rejuvenation of the West Village, and could do it without any Flames involvement whatsoever.

The Olympics do present an interesting wrinkle, but at the end of the day in regards to a new rink/stadium, the Flames need the City much more than the other way around. The onus is on the Flames to woo them.

Pretty sure I said that ...

I honestly think the discussion about the Flames funding model itself is a little premature until the city decides they want to do the thing

If the city takes a pass they take a pass. I think the fact that they haven't done so though says they won't and there will be a counter.

I think they want to get the West Village debacle behind them and see this as a way to accomplish that.

I'm not as anti-Flame owner as some. Yes they want a new hockey rink, no doubt about that, but I also think they're trying to plug into what the city wants/needs as well.

[TheoFleury]

Originally Posted by Table 5

This line of thinking assumes that this is a negotiation. The Flames are the ones who need a new hockey rink or football stadium, not the City. The City already had plans for a fieldhouse and rejuvenation of the West Village, and could do it without any Flames involvement whatsoever.

The Olympics do present an interesting wrinkle, but at the end of the day in regards to a new rink/stadium, the Flames need the City much more than the other way around. The onus is on the Flames to woo them.

Disagree. There are several markets the Flames could move to if the city/province doesn't help at all. There's a brand new arena in Quebec City as well as several less appealing options. But they will seem a lot more appealing the longer this drags out. Obviously that isn't what they want to do but at the end of the day this is all mostly about money. Sentimentality, history, culture, etc. all eventually lose out to the need for more money.

[hah]

Why don't the owners re model the Saddledome? The Rangers remodeled MSG and it was one of the oldest buildings in the league and I believe they funded it themselves. The leafs funded the Air Canada Centre. Can this model work in the smaller Calgary market?

[Table 5]

Originally Posted by TheoFleury

Disagree. There are several markets the Flames could move to if the city/province doesn't help at all. There's a brand new arena in Quebec City as well as several less appealing options. But they will seem a lot more appealing the longer this drags out.

Sure, abandon a city with a high level of corporate support and disposable income, for a city even smaller than Winnipeg, with probably a fraction of the corporate base, and Quebec taxes. Sounds like a solid financial move.

Obviously that isn't what they want to do but at the end of the day this is all mostly about money. Sentimentality, history, culture, etc. all eventually lose out to the need for more money.

If it's all about the money for the Flames, why should the City not take the same approach? For them (aka, you and me, and every other tax payer) it's all about losing hundreds of millions of dollars.

[Table 5]

Originally Posted by Bingo

Pretty sure I said that ...

You said the City should counter with a model of their own, and compared it to a contract negotiation.

Why does the City even need to counter with a model of their own? It's not the City's job to cover the Flames' incompetence. The City already has a model of their own...they want to build a separate fieldhouse and have spent millions on a West Village plan. If the Flames want to be a part of those plans they need to find a way to accommodate the City.

Remember, the Flames are still free to build this thing without any City involvement beyond clerical work. All they have to do is buy some land, file some permits, and pay for construction.

They've tried to turn this into a negotiation, when all it really is is an attempt at a handout.

[TheoFleury]

Originally Posted by Table 5

Sure, abandon a city with a high level of corporate support and disposable income, for a city even smaller than Winnipeg, with probably a fraction of the corporate base, and Quebec taxes. Sounds like a solid financial move.



If it's all about the money for the Flames, why should the City not take the same approach? For them (aka, you and me, and every other tax payer) it's all about losing hundreds of millions of dollars.

Eventually the Saddledome won't cut it and the owners aren't footing 100% of the bill for an arena. They won't even do 50% imo.

[Senator Clay Davis]

Originally Posted by TheoFleury

Eventually the Saddledome won't cut it and the owners aren't footing 100% of the bill for an arena. They won't even do 50% imo.

The current funding model they propose has $200 million of their own cash, plus $250 million from the ticket tax. $450 million gets you a pretty nice arena. Yes they aren't contributing anymore than 50% based on that, but it's pretty close to it, and that's the likely model we see for an arena when they finally give up on the fieldhouse.

[Cappy]

Originally Posted by TheoFleury

Eventually the Saddledome won't cut it and the owners aren't footing 100% of the bill for an arena. They won't even do 50% imo.

If 50% isn't even doable, they can surely leave and take the stamps with them.

[TheoFleury]

Originally Posted by Senator Clay Davis

The current funding model they propose has $200 million of their own cash, plus $250 million from the ticket tax. $450 million gets you a pretty nice arena. Yes they aren't contributing anymore than 50% based on that, but it's pretty close to it, and that's the likely model we see for an arena when they finally give up on the fieldhouse.

I suspect you are mostly right. No way the Flames get anything close to what they've asked, Calgarynext isn't going to happen imo. However, I still see the city/province kicking in around 50% on a 450m arena. The Flames offer of a ticket tax is probably attached to the current proposal, I doubt they include it (in its current form anyway) in a proposal for an entirely different concept.

[corporatejay]

Originally Posted by Senator Clay Davis

The current funding model they propose has $200 million of their own cash, plus $250 million from the ticket tax. $450 million gets you a pretty nice arena. Yes they aren't contributing anymore than 50% based on that, but it's pretty close to it, and that's the likely model we see for an arena when they finally give up on the fieldhouse.

Ticket tax is a way to skirt the NHL's revenue system. It's the Flames' money and a "user pay" system. I'm totally fine with that.

[Flamenspiel]

I think a lot of people are ok with the Saddledome replacement. The issue is the subsidization of the Stampeders new home and the very high infrastructure costs of the WV, that effectively triples the cost.

[troutman]

Originally Posted by Table 5

Sure, abandon a city with a high level of corporate support and disposable income, for a city even smaller than Winnipeg, with probably a fraction of the corporate base, and Quebec taxes. Sounds like a solid financial move.

QC is slightly bigger than Winnipeg (CMA) and growing faster.

765K to 730K.

https://en.wikipedia.org/wiki/List_o...ions_in_Canada

[Table 5]

Originally Posted by troutman

QC is slightly bigger than Winnipeg (CMA) and growing faster.

765K to 730K.

You're right, in terms of CMA's Quebec is a bit bigger. However Winnipeg has no other NHL team to compete with in the province, where Quebec needs to take on a formidable Habs presence that will most likely always be a barrier.

Either way, neither is a city I would pick over Calgary to run an NHL team for the long-term. There's a reason one city weathered the financial storm of the 90s, while the other two didn't.