Arena Negotiation Discussion v2

[Travis Munroe]

Originally Posted by jayswin

TravisMunroe's and other anecdotes aside, isn't there studies that show that the bulk of entertainment spending doesn't leave a city due to lack of a sports team or concerts? Not trying to be snarky, I just feel I've seen a few of these over the years.

As others have said, there is no way to actually have an accurate report on such a thing. If there is said study, I am sure it ignored the benefits to having a pro sports teams. The charities, the foundations, the sense of community, the pride, etc.

Originally Posted by powderjunkie

Do you think this applies to a new arena replacing the 'dome too?

I don't think anyone is really disputing that there is significant economic activity related to an arena. The question is whether it is worth a 9 figure investment + special annual exemptions compared to other businesses...


FWIW my personal limit is a one-time $99M city contribution (be it land, cash, or otherwise). CSEC owns building, covers maintenance, and pays property taxes. Unrealistic, but IMO it's a more than fair subsidy.

Parallex did dispute this with me which is the only argument I am making right now. There are dozens of questions that are up for debate when it comes to a new arena and I am only focussing on Parallexs comment that a new arena isn't going to trigger an economic spike to an area with a new arena without hurting another area. Some other area might see a slight dip in economic benefit but that is a drop in the bucket compared to what the area with the new arena will do from a economic standpoint.

As for the other questions up for debate such as location, who pays what, etc... that's for a different day.

Is there not a way for the flames to make additional profit from everything that is going on, making it worthwhile to put more in the pot? Perhaps attaching large commercial spaces that have big name anchor tenants or own the parking for the convention center with a city imposed cap on what they can charge or any other idea that involves spending more but a greater return? It seems that they want the smallest risk and don't care too much about added financial reward which perhaps is how billionaires look at their hobbies.

[jammies]

Originally Posted by Enoch Root

how would you measure how much the citizens of a city are spending on entertainment outside the city, and how much it changed, based on the impact of a single event (team leaving)?

I don't know, but I think the people that do such studies have a far better grasp of how than I do - or you. The "argument from incredulity" is a fallacy, maybe come up with something a little stronger than "I can't do it, so nobody can."

[Enoch Root]

Originally Posted by jammies

I don't know, but I think the people that do such studies have a far better grasp of how than I do - or you. The "argument from incredulity" is a fallacy, maybe come up with something a little stronger than "I can't do it, so nobody can."

The onus is on those doing the studies. Asking critical questions of a research paper is not incredulity. And don't put words in my mouth and then claim a fallacy from the misquote.

Economics is not an exact science. Economic studies make lots of assumptions and substitutions and assertions. These studies are no different. Challenging them is part of the academic process.

And that's all fine, they are what they are. My contention lies with those who cite them as 'proof of no economic benefit'. No such proof exists.

Even the basic premise of studying other cities is wrought with challenges... for one, there are so few examples - is there enough homogeneity to draw conclusions from one to the next? For any given city, are there viable substitutes, and how many? For instance, losing a team in LA or Atlanta, where there are countless sporting substitutes, is completely different than losing an NHL team in Winnipeg, where there aren't really any, (other than the CFL which is a weak one at best, with respect to attracting similar levels of spending).

There are endless questions and challenges for studies such as these.

[powderjunkie]

Originally Posted by Enoch Root

Okay, you have a city that lost a team. Great. Now tell me how you are going to measure the entertainment spending of the citizens, how much they spent outside the city, and the degree to which it increased or decreased (if at all)?

There are innumerable ways...it's called research.

Businesses, governments, and academics use the best data available every day to influence and support their decision-making. Data is almost always imperfect, but also almost always superior to anecdotes or 'gut-feelings' (all three can play a role in making a decision, but most intelligent people put more weight in real data).

Are you a climate change denier, too? Scientists haven't had every inch of the earth covered with sensors for the last million years, but they have been able to make consistent deductions based on similarly 'imperfect' data.

[monkeyman]

I feel like we're on the cusp of hearing about the 9 Garth Brooks shows again.
Think of the pride in the city as we raise our own 9 show banner.

[LWcrowfoot]

Enoch Root's argument seems to be "Is it though, is it really?"

[Enoch Root]

Originally Posted by powderjunkie

There are innumerable ways...it's called research.

Businesses, governments, and academics use the best data available every day to influence and support their decision-making. Data is almost always imperfect, but also almost always superior to anecdotes or 'gut-feelings' (all three can play a role in making a decision, but most intelligent people put more weight in real data).

Are you a climate change denier, too? Scientists haven't had every inch of the earth covered with sensors for the last million years, but they have been able to make consistent deductions based on similarly 'imperfect' data.

Are you really going to try and compare the mountains of scientific data available for the analysis of climate change to that of attempting to quantify the economic impact of a singular event to an individual city?

You have said nothing here, other than an appeal to authority, which doesn't even apply.

[powderjunkie]

Originally Posted by Enoch Root

Are you really going to try and compare the mountains of scientific data available for the analysis of climate change to that of attempting to quantify the economic impact of a singular event to an individual city?

You have said nothing here, other than an appeal to authority, which doesn't even apply.

The only thing I'd compare is the general trend-line of the various research. Ballpark numbers here, but 90% of studies support the idea of anthropogenic climate change. 90% of studies support the idea that arenas/stadiums do not deliver much ROI from public investment.

If you wanna tell me that it's actually 97% for climate change and only 72% for the arena studies, and that the arena studies are weaker, I wouldn't bother to argue...but, based on the available evidence, my conclusion would be the same.


What incentive do researchers have for showing that arena deals suck? However, if someone could legitimately show evidence that arenas/stadiums were good deals, they could do very, very, very well for themselves. The absence of compelling studies in favour of public money for arenas is pretty telling...

[FlamesAddiction]

How much does an arena and the facilities contribute to attracting talent?

I recall Iginla gushing about the arena in Pittsbugh and the facilities that are available in-house to the players. There does seem to be a certain amount of pride that players take when playing in a beautiful barn. Plus a newer arena gives the appearance of stability and investment in the franchise.

Could be overstated, but I always felt it plays a roll.

[Textcritic]

Originally Posted by FlamesAddiction

How much does an arena and the facilities contribute to attracting talent?

I recall Iginla gushing about the arena in Pittsbugh and the facilities that are available in-house to the players. There does seem to be a certain amount of pride that players take when playing in a beautiful barn. Plus a newer arena gives the appearance of stability and investment in the franchise.

Could be overstated, but I always felt it plays a roll.

Free agents are flocking to play in Edmonton's new tin-can. Same with Detroit.

I think it is something athletes appreciate, but honestly, the biggest factors in the decisions made by UFAs has always been 1. Can I win here? 2. Am I maximizing my earning power?

[Hot_Flatus]

Originally Posted by Textcritic

Free agents are flocking to play in Edmonton's new tin-can. Same with Detroit.

I think it is something athletes appreciate, but honestly, the biggest factors in the decisions made by UFAs has always been 1. Can I win here? 2. Am I maximizing my earning power?

I would reverse points 1 and 2 and I would still wager the quality of the arena is pretty low down the list of boxes to check for a free agent. If you have 1. money, 2. winning, 3. proximity to home or family, 4. climate, the actual facility is probably all the way down at number 6,7 or 8 for most UFAs.

Most players want to show up, practice, play and get out. Everything else might be nice, but is hardly necessary or going to be a deciding factor imo.

[GioforPM]

Originally Posted by Hot_Flatus

I would reverse points 1 and 2 and I would still wager the quality of the arena is pretty low down the list of boxes to check for a free agent. If you have 1. money, 2. winning, 3. proximity to home or family, 4. climate, the actual facility is probably all the way down at number 6,7 or 8 for most UFAs.

Most players want to show up, practice, play and get out. Everything else might be nice, but is hardly necessary or going to be a deciding factor imo.

I agree with your list, and would add that the order depends on the player's stage in life. A lot of UFAs are starting out families, have kids, etc. There's a reason San Jose is popular for UFAs (well, not Tavares, but lots of others).

[powderjunkie]

The list of benefits from a new arena is a mile long. Most of them are direct benefits to CSEC and facility users (ie. ticket purchasers).

As a taxpayer, I'm only interested in the ones that benefit the public at large...as far as I can tell that list is very short, and most items are dubious/debatable...

[GioforPM]

Originally Posted by powderjunkie

The list of benefits from a new arena is a mile long. Most of them are direct benefits to CSEC and facility users (ie. ticket purchasers).

As a taxpayer, I'm only interested in the ones that benefit the public at large...as far as I can tell that list is very short, and most items are dubious/debatable...

What's your cost-benefit ratio as an individual taxpayer. In other words,how much will your property taxes go up in, let's say, the CSEC's last offer? How much would you be willing to see them go up?

[powderjunkie]

Originally Posted by GioforPM

What's your cost-benefit ratio as an individual taxpayer. In other words,how much will your property taxes go up in, let's say, the CSEC's last offer? How much would you be willing to see them go up?

Really hard question to answer, especially because my view is that the Saddledome has another decade or two of life in it (in a wider sense, it's an efficient use of resources thing for me...it's like selling low on a fully loaded, mechanically sound '04 Honda Accord to buy a brand new one. I could drive it for 5 more years for free costing nothing more than oil changes; I don't begrudge anyone who wants to upgrade to a new model that includes a wireless phone charger, but I don't want to help them pay for it).

Personally, I'd find it hard to swallow more than a $20 bill each year directly related to a new hockey barn. At the same time, I don't mind a $20 for bike lanes I rarely use, or a $50 for a library, or $100 to subsidize transit I rarely use, or say $50 for a new fieldhouse I'll rarely use...

I've never actually put the city budget pie chart against a property tax bill, so my numbers may be way out of whack. My broader philosophy would be about $100M (today's value) of city money every 50 years for a hockey arena. I'd be happy to double it to $200M for a 10% stake in the team (waaaaay below market value). And I want a permanent facility-revitalization-fee implemented to pay for the next next building, in addition to the ticket tax for this new one.

[Travis Munroe]

Originally Posted by powderjunkie

Really hard question to answer, especially because my view is that the Saddledome has another decade or two of life in it (in a wider sense, it's an efficient use of resources thing for me...it's like selling low on a fully loaded, mechanically sound '04 Honda Accord to buy a brand new one. I could drive it for 5 more years for free costing nothing more than oil changes; I don't begrudge anyone who wants to upgrade to a new model that includes a wireless phone charger, but I don't want to help them pay for it).

Personally, I'd find it hard to swallow more than a $20 bill each year directly related to a new hockey barn. At the same time, I don't mind a $20 for bike lanes I rarely use, or a $50 for a library, or $100 to subsidize transit I rarely use, or say $50 for a new fieldhouse I'll rarely use...

I've never actually put the city budget pie chart against a property tax bill, so my numbers may be way out of whack. My broader philosophy would be about $100M (today's value) of city money every 50 years for a hockey arena. I'd be happy to double it to $200M for a 10% stake in the team (waaaaay below market value). And I want a permanent facility-revitalization-fee implemented to pay for the next next building, in addition to the ticket tax for this new one.

Good post... I do ask why you are ok with some of the city funded projects you don't use over an arena?
The bike lanes are for a very small portion of the city and for the most part, inner city. (Just curious)

[Manhattanboy]

Originally Posted by Travis Munroe

Is there not a way for the flames to make additional profit from everything that is going on, making it worthwhile to put more in the pot? Perhaps attaching large commercial spaces that have big name anchor tenants or own the parking for the convention center with a city imposed cap on what they can charge or any other idea that involves spending more but a greater return? It seems that they want the smallest risk and don't care too much about added financial reward which perhaps is how billionaires look at their hobbies.

If there was not already an over supply of condos in the area they could also consider a residential component.

[getbak]

Originally Posted by powderjunkie

Personally, I'd find it hard to swallow more than a $20 bill each year directly related to a new hockey barn.

There are just under 500,000 households in Calgary. If each one paid $20 per year for 30 years, that's $300 million. That would pay for half the cost of the new arena.

[stone hands]

Originally Posted by Travis Munroe

Good post... I do ask why you are ok with some of the city funded projects you don't use over an arena?
The bike lanes are for a very small portion of the city and for the most part, inner city. (Just curious)

I dont want to speak for him, but for me its because bike lanes, libraries, transit etc are public services that provide a public benefit to everyone who wants to participate and are generally either free or very accessible to everyone

a new barn so the flames can maximize profits(lets not kid ourselves, the main reason this is a topic of discussion is not to bring concerts and stuff to calgary, it's to charge more for their product) simply doesnt meet that criteria

[Parallex]

Originally Posted by Travis Munroe

Good post... I do ask why you are ok with some of the city funded projects you don't use over an arena? (Just curious)

Point of order: the arena will only have 1 user (CSEC). I can use bike lanes if I want to, peace bridges if I want to, libraries if I want to... but I'll never be able to actually use the arena if I want to. I'll just be able to buy exorbitantly priced tickets to attend events there where not a single dollars won't ever go back to the owners/funders of the facility (AKA us).

If the Flames care at all about public perception they'd find a way to put a significant actual real public use element into the operations so they can claim that they're providing something to the public for the public dollars with at least a fraction of credability.