Arena negotiation discussion. UPD: Flames release their proposal

[Philly06Cup]

Re Tangible benefits:

There aren't that many tangible or provably economic benefits to having a major sports team or building a new arena. I don't pretend it will boost the economy or create more jobs. Studies suggest it won't.

But I think the Intangible benefits are being vastly understated. They are huge. Gigantic. Immeasurable. Hockey is part of the culture of Calgary, and of Canada. Losing an NHL would be losing part of the city's identity. Minor league hockey (or the CFL) would not be an adequate replacement. Professional sports teams bring a city together. Fivethirtyeight's informal study* suggests 2/3 of Calgarians are serious Calgary Flames fans. Let's not pretend the Flames don't matter to the city and its citizens. I'm sure most people on this board have lasting memories or created friendships through the Flames. You can't measure that, but it's real, and it's important. There is something wholly unique and special about having a professional sports team, particularly HOCKEY in CANADA.

This arena should be a win-win-win for all sides. Flames want a new stadium. The city wants a new stadium. Most fans/citizens would want a new stadium. I wish there could be a profit sharing model so that the city could also benefit financially a little bit from the Flames. There are so many non-economic ways the city can return the favor and support the team in return. It would make sense for all of our goals to align. There needs to be a true partnership between the city and the sports team.

*https://fivethirtyeight.com/features...e-stanley-cup/

[Manhattanboy]

Originally Posted by RM14

Now I stand corrected. Thx.

So the partnership created the Corp. And now the Corp is running the arena show?

It's just a subsidiary controlled by the Flames. There may even be additional entities in the structure. I think the point is in any deal there will never be personal liability to the ownership group.

[Thor]

What is the total worth of the combined Flames ownership group, anyone know?

[Krynn]

Originally Posted by Thor

What is the total worth of the combined Flames ownership group, anyone know?

From my understanding the flames owners are in top 5 in the NHL but I heard that a couple years ago,so not sure now

[Hot_Flatus]

Originally Posted by Krynn

From my understanding the flames owners are in top 5 in the NHL but I heard that a couple years ago,so not sure now

$5B would be a great start if you add up all parties....that's comprised of what everyone knows about as well.

[Lanny_McDonald]

Originally Posted by Bunk

You know for certain it's a loan? Direct cash injection to help create a privately owned, tax producing building in perpetuity would not by any definition of the word be a loan.

Okay, I'm going to give you $20 for lunch. But under the condition that you give it back to me by next Tuesday. What do you call that?

I think that any "direct cash injection to help create a privately owned, tax producing building," under the condition of your paying that "direct cash injection" back, is called a loan. You can put as much makeup on that pig as you like, it still ain't kosher.

So what we really have here are three different offers on the table. There's the Flames 50:50, that has been universally panned. There's the "rule of thirds," which everyone seems to like and think is fair. Then there is the modified rule of thirds, with the city only providing the "direct cash injection to help create a privately owned, tax producing building" under the promise of it being paid back, meaning the Flames pay 100%. No outrage there because some people can't recognize a loan when they see the terms. This really is a bizarre situation.

[Makarov]

Originally Posted by New Era

Okay, I'm going to give you $20 for lunch. But under the condition that you give it back to me by next Tuesday. What do you call that?

I think that any "direct cash injection to help create a privately owned, tax producing building," under the condition of your paying that "direct cash injection" back, is called a loan. You can put as much makeup on that pig as you like, it still ain't kosher.

So what we really have here are three different offers on the table. There's the Flames 50:50, that has been universally panned. There's the "rule of thirds," which everyone seems to like and think is fair. Then there is the modified rule of thirds, with the city only providing the "direct cash injection to help create a privately owned, tax producing building" under the promise of it being paid back, meaning the Flames pay 100%. No outrage there because some people can't recognize a loan when they see the terms. This really is a bizarre situation.

It isn't a loan if the Flames are "paying back" the City contribution through property tax (which they would have to pay anyway as owners of the development) or rent (which they would have to pay ordinarily if they are tenants in the City's building).

[Rhettzky]

I want an AC highlight package of Ken Kings "greatest hits" around this arena deal. One that jumps out right now is how this wouldn't be like Edmonton and all the work would be done behind closed doors. We wouldn't hear a thing about this until they had a deal in place and full renderings!

[PeteMoss]

The 11% figure thrown around here is really dependant on the details.

If the city is taking all of the profits until they are paid back - then sure you could argue the 11% - although you are still assuming the Flames are making zero profit after the city if paid off.

But if they are splitting profits in some way - it doesn't make sense to consider the city portion as a payback of a loan and the Flames portion as unrelated to their contribution to the building. If you consider the city paying 11% - if they are sharing profits - then the Flames contribution isn't 89% if you treat the profit split the same way for both sides.

[taco.vidal]

Originally Posted by New Era

Okay, I'm going to give you $20 for lunch. But under the condition that you give it back to me by next Tuesday. What do you call that?

I think that any "direct cash injection to help create a privately owned, tax producing building," under the condition of your paying that "direct cash injection" back, is called a loan. You can put as much makeup on that pig as you like, it still ain't kosher.

So what we really have here are three different offers on the table. There's the Flames 50:50, that has been universally panned. There's the "rule of thirds," which everyone seems to like and think is fair. Then there is the modified rule of thirds, with the city only providing the "direct cash injection to help create a privately owned, tax producing building" under the promise of it being paid back, meaning the Flames pay 100%. No outrage there because some people can't recognize a loan when they see the terms. This really is a bizarre situation.

Your post and analogy in it are bizarre.

Are you Ken King? Youre posts recently seem to be comparable to Ken King's work.

[Lanny_McDonald]

Originally Posted by taco.vidal

Your post and analogy in it are bizarre.

Are you Ken King? Youre posts recently seem to be comparable to Ken King's work.

Really? How so? Because calling a loan, a loan, is bizarre? Try and hide thr true meaning in flowery language or legal mumbo jumbo, when it is distilled down to its base meaning it is what it is. Giving someone money on the condition of paying it back in full, with or without interest, is called a... ?

[Ducay]

Originally Posted by taco.vidal

Your post and analogy in it are bizarre.

Are you Ken King? Youre posts recently seem to be comparable to Ken King's work.

Hey lets call people names because we disagree! Childish debate tactic

Clearly the City's offer wasn't sweet enough, but I applaud council for holding the line. There is effectively 0% support for a richer deal outside of diehard Flames fans, and even in that microcosm its pretty low support. If they move, so be it, but they won't.

[Makarov]

Originally Posted by New Era

Really? How so? Because calling a loan, a loan, is bizarre? Try and hide thr true meaning in flowery language or legal mumbo jumbo, when it is distilled down to its base meaning it is what it is. Giving someone money on the condition of paying it back in full, with or without interest, is called a... ?

We don't know the details yet but, again, would you still consider it a loan if the City's contribution is "repaid" via property taxes or rent (things they would ordinarily be required to pay anyway)?

[nfotiu]

Originally Posted by Philly06Cup

Re Tangible benefits:

There aren't that many tangible or provably economic benefits to having a major sports team or building a new arena. I don't pretend it will boost the economy or create more jobs. Studies suggest it won't.

But I think the Intangible benefits are being vastly understated. They are huge. Gigantic. Immeasurable. Hockey is part of the culture of Calgary, and of Canada. Losing an NHL would be losing part of the city's identity. Minor league hockey (or the CFL) would not be an adequate replacement. Professional sports teams bring a city together. Fivethirtyeight's informal study* suggests 2/3 of Calgarians are serious Calgary Flames fans. Let's not pretend the Flames don't matter to the city and its citizens. I'm sure most people on this board have lasting memories or created friendships through the Flames. You can't measure that, but it's real, and it's important. There is something wholly unique and special about having a professional sports team, particularly HOCKEY in CANADA.

This arena should be a win-win-win for all sides. Flames want a new stadium. The city wants a new stadium. Most fans/citizens would want a new stadium. I wish there could be a profit sharing model so that the city could also benefit financially a little bit from the Flames. There are so many non-economic ways the city can return the favor and support the team in return. It would make sense for all of our goals to align. There needs to be a true partnership between the city and the sports team.

*https://fivethirtyeight.com/features...e-stanley-cup/

I don't really disagree with the points in your post, but that 67% claim seems rather outlandish and the methodology suspect to say the least.

About 10% of Calgary's population watch any given Flames game on TV, and about 1.5% are at any given game. Just guessing, but I'd say about two thirds of those people are regulars who watch most games, and one third is a more casual audience.

My definition of an avid fan would be one who watches most games on TV or in person and that's probably more like 8% of the population. There's probably about an additional 15% who watch some games, that you could at least call a casual fan.

The number of people who care enough to spend some money to watch and support the Flames has got to be about 25% tops. That's still a pretty great hockey market. Some US cities are probably substantially less than 1%.

[Matty81]

I clearly missed the boat.

Here I've been repaying thousands of dollars to the city in property taxes and I didn't even get any money from them up front. My house provides a place to live for 5 people who work and pay taxes and spend money locally so clearly I am creating economic benefit. Negiotiating fail on my part.

Next time around I will threaten to move to Victoria if they don't pay for half my house because I will just "repay" that anyway.

[GioforPM]

Originally Posted by taco.vidal

Your post and analogy in it are bizarre.

Are you Ken King? Youre posts recently seem to be comparable to Ken King's work.

Not bizarre at all. Money advanced but on condition it be repaid = a loan.

[sureLoss]

live stream of Nenshi and council releasing details of the city's offer:

http://globalnews.ca/news/3746376/ma...of-arena-deal/

http://www.cbc.ca/news/canada/calgar...deal-1.4291316

[Parallex]

Originally Posted by GGG

I like how king somehow thinks cnext was 50/50.

I like how he seems to think that a "contribution" is somehow only equal to the amount of money an entity other then CS&E losses. Ken King has a really ####ed up definition of partnership.

His idea of a fair deal seems to be the other side giving his side money and getting nothing in return.

[crazy_eoj]

Originally Posted by Makarov

We don't know the details yet but, again, would you still consider it a loan if the City's contribution is "repaid" via property taxes or rent (things they would ordinarily be required to pay anyway)?

If the City is contributing only a loan to the Flames, and then they OWN the building, then how much are they paying for that ownership/right to charge rent? Being gifted an almost billion dollar structure....that's not ordinary.

As mentioned in many other posts it certainly isn't un-ordinary for the city to relax property tax requirements for new construction projects either. How much does the National Music Center pay for property tax....anyone?

Pretending either of these things are 'ordinary' in this situation doesn't make any sense.

[sureLoss]