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Old 09-14-2017, 07:59 AM   #241
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Like the Bow? Or the Calgary Tower in its day? What did the city pay for those?
Lots of incentives are cut for private business in Calgary. I can't speak to the two in question, but two that come to mind were the PetroCanada and CP relocations. The city gave them massive incentives to relocate their offices to Calgary including monetary inducements and tax breaks. Let's not think for a second that the City does not bend over for private business. They can bend zoning restrictions, change the classification of historic buildings (I do believe they did this for the Bow?), provide "free land," provide "free loans," incentivize through development deals, provide infrastructure upgrades, not charge taxes, etc. Many of these incentives never make the light of day because they are protected by NDAs. The city can't let these details get out because they establish a baseline for future negotiations with other interests. The city has and will continue to use these mechanisms to incentivize business to come to Calgary, build new buildings, and then to stay in Calgary. This is what municipalities do.
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Old 09-14-2017, 08:12 AM   #242
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Using incentives to lure or keep employers who will provide jobs that pay at, and in most cases well above, the average salary is worthwhile and there's generally a financial case to be made. Outside of the hockey side of things, the Flames primarily employ people making minimum wage, in primarily part time jobs, with no benefits. Yes, there's other economic benefits the Flames provide, likewise there are also many of those same economic benefits for other companies. But it's hard to overcome the quality of employment difference a company like PetroCanada or CP provides compared to the Flames. It's pretty much insulting to suggest they're the same.

It's why if anyone thinks the city investing in an arena is more worthwhile than trying to lure Amazon here, I really don't know what to say other than my new standard "Sports really blinds us" line.
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Old 09-14-2017, 08:45 AM   #243
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Using incentives to lure or keep employers who will provide jobs that pay at, and in most cases well above, the average salary is worthwhile and there's generally a financial case to be made. Outside of the hockey side of things, the Flames primarily employ people making minimum wage, in primarily part time jobs, with no benefits. Yes, there's other economic benefits the Flames provide, likewise there are also many of those same economic benefits for other companies. But it's hard to overcome the quality of employment difference a company like PetroCanada or CP provides compared to the Flames. It's pretty much insulting to suggest they're the same.

It's why if anyone thinks the city investing in an arena is more worthwhile than trying to lure Amazon here, I really don't know what to say other than my new standard "Sports really blinds us" line.
Hold on here. First, I don't think the quality of employment thing is at all accurate. Do you believe that there are only CEOs and then a bunch of fry cooks hired by CSEC and the flames? You have trainers, doctors, coaches, event managers, booking agents, people incharge of logistically moving the team from city to city every second night... The list goes on and on. So to insinuate that the quality of employment is somehow "low brow" is pretty short sighted. Also, at 9.3% unemployment rate in the city, I don't think there really is such a thing as "bad jobs".
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Old 09-14-2017, 08:50 AM   #244
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Yeah, Flames employees would be somewhere north of the 150 mark BEFORE including any of the concession/usher type staff that works only during events.

Probably looking at 350 or so total.
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Old 09-14-2017, 08:54 AM   #245
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Originally Posted by Senator Clay Davis View Post
Using incentives to lure or keep employers who will provide jobs that pay at, and in most cases well above, the average salary is worthwhile and there's generally a financial case to be made. Outside of the hockey side of things, the Flames primarily employ people making minimum wage, in primarily part time jobs, with no benefits. Yes, there's other economic benefits the Flames provide, likewise there are also many of those same economic benefits for other companies. But it's hard to overcome the quality of employment difference a company like PetroCanada or CP provides compared to the Flames. It's pretty much insulting to suggest they're the same.

It's why if anyone thinks the city investing in an arena is more worthwhile than trying to lure Amazon here, I really don't know what to say other than my new standard "Sports really blinds us" line.
I think you need to look a little deeper into the operations of an enterprise the size of a major league sports team, and the ancillary benefits. I think I can easily respond to your comments above with your new standard "Sports really blinds us" line. Suggesting a $200-250M enterprise is not worth maintaining in the city shows your blind spot.
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Old 09-14-2017, 09:02 AM   #246
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Corporations provide ancillary benefit too. Look at how many businesses have gone under downtown from the collapse in office jobs. My point is corporations provide more tangible benefits than a sports team. It's not particularly close. Using incentives to keep large employers is more financially worthwhile than incentives for sports teams. If incentives for sports teams provided anywhere near the benefit some claim, wouldn't cities be tripping over themselves to lure sports teams?
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Old 09-14-2017, 09:02 AM   #247
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Like the Bow? Or the Calgary Tower in its day?
More like the Saddledome.
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Old 09-14-2017, 09:06 AM   #248
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Bingo, I don't think I can accept the approach even though I agree EBITDA is needed to compare to top line revenue.

Only because the approach suggests private owners in Vancouver sunk 200 million with full knowledge of doing so. Doesn't there have to be another explanation? Are they true philanthropists?

Also, isn't Ottawa privately funded? By your calculation, over $400 million. Who spends money on that? It doesn't pass the smell test. There has to be more to explain the figures.

One reason I used top line figures is, that's probably the most reliable estimation Forbes can obtain. Although its interesting they claim EBITDA knowledge. And I would agree in general that EBITDA is as important to the equation as the top line, or even moreso, as it informs real profit or losses.
To each their own.

To me revenue numbers are kind of pointless without cost numbers, so you jump to the better number which is operating income and you have net revenue streams from a theoretical investment of $600M

I tried to create a vacuum where all 7 teams built a $600M arena that opened the same day and then had their operating income increase by 2.5% per year.

Why would they do it? With the Vancouver and Montreal bankruptcies it certainly suggests they either didn't know their numbers, or had more robust growth assumptions. Either way both private buildings were sold along with the team(s)
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Old 09-14-2017, 09:11 AM   #249
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Those billionaire bastards. Trying to create a successful business model. I actually hope the Flames leave now. We absolutely deserve it. We can roll around in our guilt free, capitalist free library card income.
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Old 09-14-2017, 09:22 AM   #250
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Those billionaire bastards. Trying to create a successful business model. I actually hope the Flames leave now. We absolutely deserve it. We can roll around in our guilt free, capitalist free library card income.
Wait, are you arguing that opposition to a massive government subsidy for a private business is the anti-capitalism position in this debate?
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Old 09-14-2017, 09:24 AM   #251
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He's saying government funded arenas is capitalism and privately funded arenas is capitalist-free (communist?). You heard it here folks!
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Old 09-14-2017, 09:28 AM   #252
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Hold on here. First, I don't think the quality of employment thing is at all accurate. Do you believe that there are only CEOs and then a bunch of fry cooks hired by CSEC and the flames? You have trainers, doctors, coaches, event managers, booking agents, people incharge of logistically moving the team from city to city every second night... The list goes on and on. So to insinuate that the quality of employment is somehow "low brow" is pretty short sighted. Also, at 9.3% unemployment rate in the city, I don't think there really is such a thing as "bad jobs".
I worked at a 10,000 seat arena - the arena itself had about 15 full time employees and then 100s of hourly people. Given the arena isn't exploding, with a new arena

The junior team itself (one of the biggest in Canada) - probably had 20 full time employees. Obviously the Flames are a much bigger operation - but its really not that many jobs.
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Old 09-14-2017, 09:32 AM   #253
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Corporations provide ancillary benefit too.
No one is arguing that.

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Look at how many businesses have gone under downtown from the collapse in office jobs.
And how many people gave a rip? How many people cried over the spilled milk of the lost money used to lure some of those businesses here or the incentives given to them to remain?

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My point is corporations provide more tangible benefits than a sports team. It's not particularly close.
In some regards, yes. In others, no. One of the things that is very difficult to quantify is the civic pride, community spirit, and the uniting force of a local sports team. What is the tangible benefit of that? To me, this is like trying to explain the cost of reputation to the executive of any company when you're talking about risk mitigation. The hard dollars and numbers are easy for them to understand, but the value of reputation is a much more difficult concept for them to understand. It is these unifying forces that a sports team provides which is that immeasurable value that we have to consider. As important as a corporation is to the city, I've never seen a big corporation pull a city together and get people from all walks of life, take pride in the same thing, in the name of the city where they live. That's a pretty valuable thing IMO.

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Using incentives to keep large employers is more financially worthwhile than incentives for sports teams.
So you're saying it was okay to continue to throw money at losers like Sears or Zellers, because they were big employers? I think there is a balance, and you have to place a value on the company. I think you are blinded by your lack of understanding of major league sports in thinking the value from these franchises is small. I think you have read a few too many of those reports that suggest building facilities is a losing proposition and extrapolated that to me operations is also a losing proposition. I think you would be surprised at the tax revenues generated by the Flames, and the shortfall we would feel if they were removed from the tax base.

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If incentives for sports teams provided anywhere near the benefit some claim, wouldn't cities be tripping over themselves to lure sports teams?
Cities are tripping all over themselves to lure teams away from each other. You have to appreciate that there are very few of these teams, and the commitment to building a viable facility is huge, so that limits the market, but the back-and-forth happens every year. For example, Justin football:

Oakland Raiders moved from Oakland to Los Angeles, then back to Oakland, and are soon to be off to Las Vegas.

Los Angeles Rams moved to St. Louis, and then back to Los Angeles.

San Francisco 49ers just moved to Santa Clara.

Baltimore Colts moved to Indianapolis, spurning an expansion team in the NFL.

Cleveland Browns moved to Baltimore, spurning an expansion team in Cleveland.

Houston Oilers moved to Memphis, spurning an expansion team in Houston.

San Diego Chargers moved to Los Angeles.

All of these were a desire of a city to have, or reclaim, a team. And all of them have resulted, or will result, in new stadiums. The value of having these teams is high, and the municipalities know it. This is why they continue to build arenas and stadiums, in hope of coercing one to come to their fair city.
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Old 09-14-2017, 09:40 AM   #254
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Originally Posted by Senator Clay Davis View Post
Using incentives to lure or keep employers who will provide jobs that pay at, and in most cases well above, the average salary is worthwhile and there's generally a financial case to be made. Outside of the hockey side of things, the Flames primarily employ people making minimum wage, in primarily part time jobs, with no benefits. Yes, there's other economic benefits the Flames provide, likewise there are also many of those same economic benefits for other companies. But it's hard to overcome the quality of employment difference a company like PetroCanada or CP provides compared to the Flames. It's pretty much insulting to suggest they're the same.

It's why if anyone thinks the city investing in an arena is more worthwhile than trying to lure Amazon here, I really don't know what to say other than my new standard "Sports really blinds us" line.
Nice cherry pick. The fact is that you intellectually understand that there's a package of things that the Flames bring. From a certain number of jobs, to a certain number of hotel bookings, to tourism hell do you think Amazon wants to come to a city that has troubles keeping a pro sports team! Once you accept the fact there are various benefits to the team and its stadium being in the city, its not too much to ask for a kick-in, that isn't given back. Those benefits aren't going away.
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Old 09-14-2017, 09:54 AM   #255
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Cities are tripping all over themselves to lure teams away from each other. You have to appreciate that there are very few of these teams, and the commitment to building a viable facility is huge, so that limits the market, but the back-and-forth happens every year. For example, Justin football:

Oakland Raiders moved from Oakland to Los Angeles, then back to Oakland, and are soon to be off to Las Vegas.

Los Angeles Rams moved to St. Louis, and then back to Los Angeles.

San Francisco 49ers just moved to Santa Clara.

Baltimore Colts moved to Indianapolis, spurning an expansion team in the NFL.

Cleveland Browns moved to Baltimore, spurning an expansion team in Cleveland.

Houston Oilers moved to Memphis, spurning an expansion team in Houston.

San Diego Chargers moved to Los Angeles.

All of these were a desire of a city to have, or reclaim, a team. And all of them have resulted, or will result, in new stadiums. The value of having these teams is high, and the municipalities know it. This is why they continue to build arenas and stadiums, in hope of coercing one to come to their fair city.
Talk to anyone in St Louis, and they regret ever building that stadium, and would never support another one. I believe LA and Las Vegas are all privately funded, aren't they?

Public sentiment in the US has taken a big shift against funding these kind of stadiums over the last few years. Sure, there will probably be some, but it is getting to be a harder and harder sell to the electorate.
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Old 09-14-2017, 10:03 AM   #256
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Lots of incentives are cut for private business in Calgary. I can't speak to the two in question, but two that come to mind were the PetroCanada and CP relocations. The city gave them massive incentives to relocate their offices to Calgary including monetary inducements and tax breaks. Let's not think for a second that the City does not bend over for private business. They can bend zoning restrictions, change the classification of historic buildings (I do believe they did this for the Bow?), provide "free land," provide "free loans," incentivize through development deals, provide infrastructure upgrades, not charge taxes, etc. Many of these incentives never make the light of day because they are protected by NDAs. The city can't let these details get out because they establish a baseline for future negotiations with other interests. The city has and will continue to use these mechanisms to incentivize business to come to Calgary, build new buildings, and then to stay in Calgary. This is what municipalities do.
I guess it's hard to tell without the details, but I suspect those massive incentives are far less than what the Flames are asking for? Is there a reason to think otherwise?
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Old 09-14-2017, 10:13 AM   #257
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Nice cherry pick. The fact is that you intellectually understand that there's a package of things that the Flames bring. From a certain number of jobs, to a certain number of hotel bookings, to tourism hell do you think Amazon wants to come to a city that has troubles keeping a pro sports team! Once you accept the fact there are various benefits to the team and its stadium being in the city, its not too much to ask for a kick-in, that isn't given back. Those benefits aren't going away.
I don't disagree with what you're saying (as a matter of principle), but it's difficult to comment on the balance being proposed by the City without more detail. For instance, if the City is proposing a 200 million dollar contribution to the Flames' arena, I don't think that it is unreasonable for the City to expect the Flames organization to pay property tax on its property just like any other property owner would. That isn't really "repaying a loan" as far as I'm concerned.
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Old 09-14-2017, 10:24 AM   #258
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Why not make visitors pay for the City's portion of the bill?

A hotel tax of $1 per night on every hotel and motel room in Calgary until the City's third of the bill is paid.

It wouldn't deter visitors, and it lessens the blow to the local taxpayer. American cities do this, and I don't see a problem with it. Most recently, Vegas has done this for their Raiders stadium to which the State has already committed to $750MM USD to build.

The Flames new arena won't cost $1.9 billion USD, so it shouldn't be a problem for the city to recoup their ~$200 million CAD over time.

https://lasvegassun.com/news/2017/ma...-raiders-move/
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Old 09-14-2017, 10:27 AM   #259
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There has been a lot of discussion about the proposed arena over the last couple of days and I wanted to take the time to clarify a few things. The City has been negotiating in good faith with the Calgary Sports and Entertainment Corporation (CSEC), the owners of the Flames, for months with respect to a new arena in Victoria Park and with the objective of reaching an agreement that would be a win for taxpayers and a win for the owners of the CSEC.

Back when CSEC introduced CalgaryNEXT, I proposed a number of principles, which were unanimously adopted by Council, to guide our work with respect to any new arena. The most important tenet was that public money must be used for public benefit, particularly with many Calgarians still struggling during this fragile economic recovery. Furthermore, I have always maintained that there must be public engagement on any proposed agreement prior to Council making a decision.

I keep hearing people say that ‘the Mayor doesn’t want an arena’. This is simply not true. I recently released my vision for a cultural and entertainment district in the River’s District, in the eastern part of downtown, and a new arena is a vital part of that plan. We know, however, that it takes more than just an arena to make a vibrant community (after all, the Saddledome has been there for 34 years without spurring much additional real estate development) and I have outlined a solid plan to make a cultural and entertainment district a reality.

There is no doubt that the Flames are a crucial part of our city’s cultural fabric and a new arena will have a positive impact on our city. Everyone understands this. That is why the City has devoted considerable time and money to advancing discussions with CSEC on this project.

That is also why I am surprised that CSEC has walked away from the table. It’s true that negotiations have been long and difficult, but that is to be expected given the amount of public money at stake. The City has a fair and reasonable proposal on the table and we were expecting negotiations to continue after our August break.

It is disappointing that the ownership group has unilaterally determined that there is no deal here. CSEC was told as recently as Monday that the City is still at the table and willing to negotiate. The City has not and will not ever leave the table as long as I am Mayor. But we will continue to search for a win-win deal. A win for citizens and taxpayers, and a win for the Flames owners.

Yesterday, Council authorized me to share details of the proposal that the City has on the table now. You will hear more about the details of the proposal later this week. I think this proposal is eminently reasonable and a good mix of public money and public benefit, where taxpayers and the owners share in the risk and in the upside. I hope you look on this proposal with a fresh perspective and the knowledge that I am fighting for you, even if it becomes difficult. Nothing of value, like building a great city, comes easy and we must be wary of those who pretend that it is.

The City is ready to talk and ready to engage with CSEC. We have before us a path to a win-win for our community, but it requires partnership and goodwill.

I thank you for your support and I look forward to sharing the details of the city’s proposal shortly.

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Old 09-14-2017, 10:36 AM   #260
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Well, he's saying all the right things in that release. Let's see the deets later this week.
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