Arena negotiation discussion. UPD: Flames release their proposal

[Ryan Coke]

Originally Posted by iggy_oi

I don't think people are missing that point. Nenshi even said they're open to negotiating that specific issue, but you can't do that if no one is sitting at the other side of the table.

Some people seem stunned as to why the Flames think they should be tax exempt. Seeing as they currently are, there is nothing exceptional about it.

I do agree with the rest, for sure.

[GGG]

Originally Posted by Ryan Coke

The part that many others aren't seeing is that they currently do not pay property tax, but the cities plan is to start charging them in lieu of the up front contribution. They are taking one thing away while giving them something else.

So compared to what they currently receive, which is tax exemption, being charged for it now is a new revenue source for the city. I can't believe people are missing that important point.

The city previously decided that was a worthwhile contribution towards the Flames existing in our city, but now they feel it is an opportunity to take that away. It is an important distinction.

Yes currently the team is being subsidized by the City by roughly 6 million per year. The flames are asking the city to increase that subsidy to roughly 15 million per year. Whereas the city roughly wants to maintain that rate of subsidy and the Flames can decide on how to spend it.

So the city isn't taking anything away from the Flames. They are saying the Flames value to the city doesn't change with or without a new arena.

[CSharp]

I think the Flames organization forcing this to be an civic election issue is total BS. More than anything, the City of Calgary as a public organization has been more than reasonable with their offer. Since the Flames is and always has been a private venture, it should be asking the whole population of the city to pay for the majority of the arena. It's almost like you or I going into a bank asking to buy a house and asking for $200K, not to borrow, but to pay for a $300K house. Then tell the bank, "Oh, and I don't think I need to repay that $200K back and the sale of the house later I get to keep the money." The manager of the bank would probably ask you or me to leave and then slam the door shut.

[Ryan Coke]

Originally Posted by GGG

Yes currently the team is being subsidized by the City by roughly 6 million per year. The flames are asking the city to increase that subsidy to roughly 15 million per year. Whereas the city roughly wants to maintain that rate of subsidy and the Flames can decide on how to spend it.

So the city isn't taking anything away from the Flames. They are saying the Flames value to the city doesn't change with or without a new arena.

Yes, agreed. They don't want to contribute anything new based on their public proposal, only to change the way they contribute.

They will likely end up continuing the tax free status as well as some capital contribution to the new facility when this eventually gets done.

None of this is in any way a defence of the way the Flames have managed this process.

[Locke]

Originally Posted by Roughneck

-"Wait, he's not going to be talking about it anymore but he has a talk coming up?" Uh huh." (re: King being done but has a talk with the Chamber of Commerce)

-What the Flames released wasn't the same deal that was put in front of council.

-Ticket tax would be debt taken on by the city (fronting the loan)

-If 'ticket tax is Flames revenue' argument is valid, then property tax being city revenue is also valid so city would be paying 120%: 'both are silly arguments.'

-Goal was to have public engagement on it. City's proposal was designed as something to take to the public.

-Land didn't have any value in Flames proposal

-Flames insist on Saddledome demolition

-The CRL for East Village has been successful but there is only ~$150M left in the 10 years and it is allocated for public infrastructure in Rivers District. Would require an extension beyond 2027 which means a longer deferral of property tax to the city operating budget.

-Already an arena on the land that hasn't seen development, so even if CRL monies weren't already accounted for no guarantee it would be able to fund the arena

-City is willing to negotiate what the property tax is, doesn't understand where team's numbers came from that said property tax wasn't viable

-City is at the table

-Wants a deal that makes sense for everyone

-Negotiations are hard, and should be hard

No wonder it took 6 days to present a proposal that was already complete whereas the City did it immediately.

[Flacker]

Originally Posted by Locke

No wonder it took 6 days to present a proposal that was already complete whereas the City did it immediately.

The fact that they had to "tweak" it for public consumption, should tell you something about their original position. These fellas are the pinnacle of entitlement.

[Table 5]

I'm still waiting for the rendering Ken King promised. Or was the arena just going to be giant x?

[Manhattanboy]

Maybe someone will ask him about the rendering(s) at the Chamber lunch.

[Flacker]

Originally Posted by Table 5

I'm still waiting for the rendering Ken King promised. Or was the arena just going to be giant x?

Ken King is vigorously working in MS Paint, which I assume was the design software used for CalgaryNext.

[Robbob]

So is this Flames proposal (yesterday) the one they gave to the City back in July? If it is, the reason why they probably backed off some things is because that was the first Vic park offer, with from the sounds of it, some pretty big asks.

[Amethyst]

If the NHL is only viable in 5-6 markets without huge taxpayer subsidies, there is something wrong with the NHL business model.

I find it interesting that so many fiscally conservative, tax-cut demanding people seem to be in favour of subsidizing a professional sports team.

[EldrickOnIce]

Originally Posted by Amethyst

If the NHL is only viable in 5-6 markets without huge taxpayer subsidies, there is something wrong with the NHL business model.

I find it interesting that so many fiscally conservative, tax-cut demanding people seem to be in favour of subsidizing a professional sports team.

Which people are these?

[topfiverecords]

Originally Posted by Table 5

I'm still waiting for the rendering Ken King promised. Or was the arena just going to be giant x?

King just released it.

[AC]

I saw Francis made a legal threat after receiving criticism for his BS article:

@c_debruyn
Replying to @SUNSports @EricFrancis
Eric Francis is literally paid by the flames to write and say this garbage. Nice journalistic integrity. What a hack

@EricFrancis
Replying to @c_debruyn @SUNSports
Be careful you don't get sued slandering folks like that.

Also wouldn't it be libel, not slander?

[stone hands]

Does Francis ever listen to himself? I can't believe how he can say Winnipeg as a successful roadmap for what should happen here...and there's 30% government funding. Which is what the city is suggesting, yet he says their offer is not feasible

Also the fact that he continually contradicted himself, he states that if we don't have a new rink, the in 3-4 years the flames will leave...and immediately say that won't necessarily happen...he did it at least twicein this interview

[Textcritic]

Originally Posted by AC

I saw Francis made a legal threat after receiving criticism for his BS article:

@c_debruyn
Replying to @SUNSports @EricFrancis
Eric Francis is literally paid by the flames to write and say this garbage. Nice journalistic integrity. What a hack

@EricFrancis
Replying to @c_debruyn @SUNSports
Be careful you don't get sued slandering folks like that.

Also wouldn't it be libel, not slander?

Just listening to this tool on the radio now trying his damnedest to backpedal on his article: "I'm not picking sides, but unless Calgarians want to lose their NHL team—"

[JohnnyT]

Francis has been and always will be the biggest hack in Calgary media

[Roughneck]

Originally Posted by Table 5

I'm still waiting for the rendering Ken King promised. Or was the arena just going to be giant x?

Doesn't really matter what it looks like, Rogers or Scotiabank will pay for the naming rights.

[EldrickOnIce]

Originally Posted by Roughneck

Doesn't really matter what it looks like, Rogers or Scotiabank will pay for the naming rights.

Yeah, but they aren't paying 800M like they did in Toronto

[getbak]

I know it's been pointed out many times how flawed the Flames' argument is that the city's proposal would require them to pay 120% of the cost of the building. I decided to crunch the numbers in a way that most of us should be familiar with, buying a house.


Let's say you're buying a $500,000 house and have a $100,000 down payment. You need to borrow the remaining $400,000 and get a mortgage.

Your bank offers you a mortgage with a 3.5% interest rate with the full loan to be paid off in 35 years. At the end of the loan, you will have paid a total of $694,328.27 with interest.

Now, during that time, you will have also been paying property taxes because that's what we all do. The property taxes on a half-million dollar house should be about $3,200 a year.

Let's assume a 2% annual increase in the tax rate. By the end of 35 years, your property taxes will cost $6,274.16 a year. Over the 35 years, you will have paid a total of $159,982.33 in taxes.


If we add it all up, after 35 years, you will have paid a total of $854,310.60 for your $500,000 house, or 170.86% of the original price.

EDIT: Whoops, forgot to include the original $100,000 down payment too... So, the actual total is $954,310.60 or 190.86%.


When you look at it that way, even if you buy into the idea that the Flames would be paying 120% of the cost, it's still a hell of a deal.