Calgary city council approves arena deal (UPD: new deal upcoming?)

[Bookie21]

For those actually interested: Edmonton Arena Agreement

Exactly, the city.....and fans got bent over. City paid $313 million for the project. Fans pay $125 million in a ticket tax, and Katz the deadbeat, $166 million, that is mostly just paid in rent, not cash up front. Redirect Notice

 

[McDLT]

I’ve slept on it and I’m still upset that this is the deal that the city is pursuing. Nenshi even says that he knows about all of the research (I can only assume he is referring to the vast amounts of research showing that public investment in arenas never pays off), and then says “I’m not trying to sell you magic beans”, but then roughly 1/3 of the predicted benefit is future property taxes from businesses that will *hopefully* open next to this new arena. I also think that they’ve chosen to ignore inflation since the cost of this project is immediate, but most of these benefits are expected to be realized over a 35 year span. I doubt the city sees more than $200m in todays dollars of return on their $275m investment. IMO This is a bad deal for the city.

Also, I’m bummed that the saddledome is being demolished (but they are keeping the parkade).

Yeah I was right

 

[supsens]

Bettman supposed to be a business whiz why can't he and his franchise figure out a plan that does not require taxpayers to fund it .
It is simple mr commish show Calgary fans you are as good as your inflated salary and help the team get to a new facility without public money .
It's a game great one but it's not a hospital where lives are saved a school where kids get a future its a multi million dollar sport adventure yes its fun but it's not up to taxpayers to furnish do your damn jobs.

Arena’s are used for many types of public events, if no tax dollars were spent on them there would be very few on the planet

 

[Melrose Munch]

What a ripoff for Calgary.

 

[InfinityIggy]

By my count, the CoE contributed less to their arena project than what Calgary's committed here. Unless 226M is suddenly more than 275. Plus they got a new (and needed) springboard for downtown development.

Could Edmonton gotten more out of Katz? Sure, by all accounts the Ice District in Edmonton has been a massive success for all sizes.

That's because you've counted entirely incorrectly.

Firstly, the cost of Edmonton's Arena Project totaled $614M. The city paid 313M for their portion, much through paid via the CRL.

Then the citizens of Edmonton were then hit with a $125M ticket tax, you can debate whose column this belongs in, but it isn't coming out of the Oilers pockets.

Katz group provided just $166M in funding. This accounts for just 27% of the total cost. In contrast Edmonton provided 51% directly, and if you choose to factor in the ticket tax that's a whopping 73% of the cost.

The Flames Arena project is projected at $550M. With $275M from both the City and CSEC. 50% each.

So not only will the City of Calgary pay less in total dollars than the city of Edmonton, they also will pay less as a ratio of the total cost of the project.

The fact that Katz got his arena for just 27% of the cost means that yes, the Fans in Edmonton: Bent. Over. A. Barrel.

It's actually an amazing case study in why cities shouldn't finance these projects. All of this is without even factoring the real-estate that the city essentially gifted Katz.

 

[Riptide]

https://calgary.ctvnews.ca/bettman-says-flames-finances-impacted-by-the-aging-saddledome-1.3826477

Bettman said that Calgary used to be a top 10 team that made money for the league, but now over the past few years, the NHL has been the one writing cheques.

“The cheques are getting bigger and that means the situation, financially, continues to deteriorate and that will affect, I suppose, the competitiveness of the organization.”

***

Yet Forbes says Calgary Operating Income: $5.4 M

Bettman is so full of it. Anything to get the taxpayers to buy him a new building.

And what cheques is the NHL writing? The revenue sharing cheques like half the league gets.

Or maybe Forbes who doesn't have the actual numbers is wrong?

 

[Riptide]

That's because you've counted entirely incorrectly.

Firstly, the cost of Edmonton's Arena Project totaled $614M. The city paid 313M for their portion, much through paid via the CRL.

Then the citizens of Edmonton were then hit with a $125M ticket tax, you can debate whose column this belongs in, but it isn't coming out of the Oilers pockets.

Katz group provided just $166M in funding. This accounts for just 27% of the total cost. In contrast Edmonton provided 51% directly, and if you choose to factor in the ticket tax that's a whopping 73% of the cost.

The Flames Arena project is projected at $550M. With $275M from both the City and CSEC. 50% each.

So not only will the City of Calgary pay less in total dollars than the city of Edmonton, they also will pay less as a ratio of the total cost of the project.

The fact that Katz got his arena for just 27% of the cost means that yes, the Fans in Edmonton: Bent. Over. A. Barrel.

It's actually an amazing case study in why cities shouldn't finance these projects. All of this is without even factoring the real-estate that the city essentially gifted Katz.

Most would count a ticket tax as proceeds coming out of Edmonton Oiler's pocket. Because if the market supports a $100 ticket+a 10% tax, then the Oilers could in fact be charging $110 with zero impact. However the market might not support $110+10% tax.

 

[CorbeauNoir]

Gotta laugh at all the savants in this thread who bought into Gary and Kings rhetoric that the Flames were ever in danger of moving.

The city's out of cash, major NHL-sponsorship-level businesses are still leaving and still being replaced by nothing, and the smaller businesses left over are now the ones getting swallowed up and spat out as the taxation death spiral the city is trapped in grows wider. Beyond offering a handful of temporary construction jobs a new building resolves none of these existential threats to Calgary's ability to remain a viable NHL-caliber city.

 

[InfinityIggy]

Most would count a ticket tax as proceeds coming out of Edmonton Oiler's pocket. Because if the market supports a $100 ticket+a 10% tax, then the Oilers could in fact be charging $110 with zero impact. However the market might not support $110+10% tax.

This argument gets brought up all the time in regards to ticket tax and it doesn't hold water. If you're going to make that argument then the same would apply to every other product and service that is taxed. There is a reason that the cost of a product always increases and never stays static (reducing profit to keep market support) when a new tax is applied to it.

You can look at anything taxed this way and the same always holds true. If the Oilers could've been charging that 10% for those tickets, they already would've been.

 

[ponder719]

TD Garden was built all with private loans as well (granted in 1994 and cost of $120 mill)

Every piece of Patriots Place, including Gillette Stadium, has been built 100% with private funds from Kraft and investors.

The Wells Fargo Center was also privately funded, with the exception of some infrastructure improvements in the area that the city was considering anyway. Comcast is also doing the current renovation privately.

 

[Bookie21]

Most would count a ticket tax as proceeds coming out of Edmonton Oiler's pocket. Because if the market supports a $100 ticket+a 10% tax, then the Oilers could in fact be charging $110 with zero impact. However the market might not support $110+10% tax.

This argument is a little bit of an oxymoron, but the people of Edmonton still get bent over by paying a insane ticket tax, that the city funded, not Katz

 

[InfinityIggy]

The city's out of cash, major NHL-sponsorship-level businesses are still leaving and still being replaced by nothing, and the smaller businesses left over are now the ones getting swallowed up and spat out as the taxation death spiral the city is trapped in grows wider. Beyond offering a handful of temporary construction jobs a new building resolves none of these existential threats to Calgary's ability to remain a viable NHL-caliber city.

 

[Riptide]

I still do not understand why the Flames ownership couldn't have paid for this themselves, and don't say it's impossible, cause it's not. These guys are not only rolling in money, but can line up cash where needed in investors. I voted for Nenshi last election because he was essentially against the arena, if this goes through now I'll be spending my vote on someone else.

Let the billionaires pay for their toys.

Because the Flames ownership is smart enough to recognize that there's benefits to the CoC to have this building with this team there. Revitalizing an area will lead to an increase in the tax base from that area. The city also receives some of the proceeds from events that take place, and get a building that they do not have to maintain or upgrade.

The question isn't whether there's benefits to the city to help make a deal happen, it's how good are those benefits and what do they weigh against the cost. If the CoC thinks they can spend 275m (assume there will be overruns and call it 300m) and think that over 35 years that they'll receive 400m+ in return and revitalize an entire area as well as receive an anchor tenant... that's not a bad thing.

 

[Riptide]

This argument gets brought up all the time in regards to ticket tax and it doesn't hold water. If you're going to make that argument then the same would apply to every other product and service that is taxed. There is a reason that the cost of a product always increases and never stays static (reducing profit to keep market support) when a new tax is applied to it.

You can look at anything taxed this way and the same always holds true. If the Oilers could've been charging that 10% for those tickets, they already would've been.

And now they certainly can't.

 

[InfinityIggy]

And now they certainly can't.

If Katz was at all concerned about that he would've fronted the money so there wouldn't need to be a ticket tax, based on the logic that it's the Oilers 'paying' the tax. He didn't though, for the very simple reason that it's far better to have your fans (read Edmontoians) pay it instead.

 

[weaponomega]

Based on the debates last night, it will likely be 9 for and 4 against, with the leader of the "No" group previously being a strong proponent for the 2016 majority-city funded proposal. Wonder what changed.

Probably the same dissenting councillors who always vote contrary to the way certain other councillors vote regardless of what they are voting on.

 

[gstommylee]

If the city would think they can get a better deal than 50%/50% where flames cover more than 50% where the flames would even agree to that, they would have. At this point its probably the best the city will get. Doing nothing for another who knows how long isn't a solution either.

 

[Mightygoose]

CBC Article comparing this deal with the previous 2 that each side rejected.

https://www.cbc.ca/news/canada/calgary/calgary-proposed-arena-deal-1.5221185

My favourite part of the FAQs

"How does this new proposal compare to the June 19, 2017, proposal?
While discussions have occurred on this project for some years, this is the first proposal that the parties have agreed to."

Also in 2017 there was an election around the corner. Mr. Nenshi, looking for re-election decided to play the 'I'm fighting for the taxpayers' card and was publicly condescending towards talks right up to the day before the campaign began. This on top of King and Bruke playing bad cop - good cop with their pal Mr. Francis looking at flight schedules to Houston. Election comes and Flames saw an opportunity to punt him to the curb which failed miserably.

Mr. Nenshi proceeds to put stock in the Olympic bid which the province said they would only support with a plebiscite. With his legacy project not so much of a sure thing (and it wasn't) the city quietly crawls back to the table...Olympic bid - doom... and now the mayor calls this a good deal which though the whole time never really said no to public funding. Just public funds must have public benefit. Benefit however one wants to frame it.

So here we are with a deal that should have been done 2 years ago. Funny what can happen when egos on both sides are checked at the door.

 

[Zenos]

That's because you've counted entirely incorrectly.

Firstly, the cost of Edmonton's Arena Project totaled $614M. The city paid 313M for their portion, much through paid via the CRL.

Then the citizens of Edmonton were then hit with a $125M ticket tax, you can debate whose column this belongs in, but it isn't coming out of the Oilers pockets.

Katz group provided just $166M in funding. This accounts for just 27% of the total cost. In contrast Edmonton provided 51% directly, and if you choose to factor in the ticket tax that's a whopping 73% of the cost.

The Flames Arena project is projected at $550M. With $275M from both the City and CSEC. 50% each.

So not only will the City of Calgary pay less in total dollars than the city of Edmonton, they also will pay less as a ratio of the total cost of the project.

The fact that Katz got his arena for just 27% of the cost means that yes, the Fans in Edmonton: Bent. Over. A. Barrel.

It's actually an amazing case study in why cities shouldn't finance these projects. All of this is without even factoring the real-estate that the city essentially gifted Katz.

A few points:

1. The total cost of Edmonton's arena project was 614M But that's obviously not just Rogers Place, but also an LRT Station, A community rink, Pedway connection, and the "Winter Garden"; a sort of forum or indoor Plaza.

2. Your "51% directly" should probably have an asterisk next to it. The largest portion of that comes from the CRL, ie. new property tax generated by new neighbourhood development. That was projected to be 597 million in new property taxes over 20 years back in 2013. Turns out, its more likely to be at least 675. That doesn't happen without Katz's Arena or Katz's property development.

3. Adding the ticket-tax onto the city's side of the bill seems a bit disingenuous, no?

4. What's with the weird fascination for sodomy?

5. Also seems interesting that the most vocal critics of Edmonton's Arena deal aren't even COE tax payers.

 

[Fenway]

 

[Mightygoose]

It looks like the consultation period only runs to Friday at noon local time.

https://www.cbc.ca/news/canada/calgary/calgary-arena-deal-timeline-scrutiny-1.5222311

So less than 100 hours from the time they deal was officially announced. Sounds like fait accompli to me. Then again, people have voiced their opinions months and perhaps years on this matter already. If elected officials are in place to decide on behalf of the people then it's time to decide either way.

If Monday's meeting can be a Pay Per View live stream, that may generate more $$ than any returns will bring

 

[Beerfish]

CBC Headline today... "Calgary slashes emergency services, transit, affordable housing in 60 million dollar budget cut."

Meanwhile....

 

[Beerfish]

Well, Calgary seems to have made the same awful awful awful grevious errors that Edmonton made (I am from Edmonton) in this deal. Municipal politicians are moronic easy marks.

 

[jonathan613]

I am unclear here as to who is responsible for cost overruns. Also, is it correct for me to assume that the numbers people are quoting here a swell a sin the media are in terms of american dollars and not Canadian dollars? 550 million american dollars seems a bit low to be as what the final cost is likely to be.

Also, this deal does not account for maintenance and capital improvement costs over the life of the 35 year lease period?

I think the city of calgary had more leverage here than they used as I see no market that would have seriously been a threat as far as relocation would of been concerned..

 

[GindyDraws]

It looks like the consultation period only runs to Friday at noon local time.

https://www.cbc.ca/news/canada/calgary/calgary-arena-deal-timeline-scrutiny-1.5222311

So less than 100 hours from the time they deal was officially announced. Sounds like fait accompli to me. Then again, people have voiced their opinions months and perhaps years on this matter already. If elected officials are in place to decide on behalf of the people then it's time to decide either way.

If Monday's meeting can be a Pay Per View live stream, that may generate more $$ than any returns will bring

So, it's now or never for the arena deal and, in essence, the future of the Flames.

I mean, it's pretty much agreed on, but who's to say there's going to be politicians that'll be voting against the deal come Monday.

Either way, people are going to be glued to their TVs, smartphones, and computers throughout lower Alberta.