Coyotes to lose 30M?

[Sotnos]

Those were my thought exactly - especially when a team trumpets about things financial to the press.

I am always sceptical about claims of money lost by a "team", especially when the team also controls it's arena (as do the 'Yotes) - money can be moved around between team affiliated entities to make a teams losses look bigger or smaller and non-hockey revenues the team gets from the Arena (by virtue of the team being there and their controlling the master lease) can get conveniently ignored.

A team can make all sorts of claims in public and in the press - but generally it is just posturing.

This is what I try to point out to people when the Bolts brass complain about money (which is just about every month) - they're angling for a tax break/ticket price hike/government subsidies. But oh no, it's because Tampa is a "bad market" that doesn't deserve a team and will need to trade one of our top players for someone else's garbage ASAP.

 

[Hawker14]

This is what I try to point out to people when the Bolts brass complain about money (which is just about every month) - they're angling for a tax break/ticket price hike/government subsidies. But oh no, it's because Tampa is a "bad market" that doesn't deserve a team and will need to trade one of our top players for someone else's garbage ASAP.

I understand your dilemna as a fan, but from the outside looking in it seems odd that they claim possible losses. I look at the Bolts, as a recent Stanley Cup winner and announcing 20,000 plus attendance, as an extremely strong NHL market.

Yet, when it comes out they're not contributing into revenue sharing even with their amazing attendance figures one eyebrow is raised. When the management then says losses are possible, another eyebrow is raised causing a look closer.

It's not a slight against the Tampa-St. Pete market, but when announced attendance is great (top 3), yet revenues aren't among the top ten, it does add some legitimacy to the Bolts' stating possible losses considering the team is spending close to the cap.

If the Bolts, as a middle of the pack revenue generating team (ie. too good for revenue sharing), had a middle of the road payroll (between the min & max) of $ 35 million they'd break even, which seems about right when looking at the Lightning's claims.

It's got nothing to do with the great fans the team has.

 

[saskganesh]

They do. They get all hockey related revenue and the lease is basically as cheap as it can get.

now I am puzzled. if the projected $ 30 million USD loss is hyperbolic, and there is no need to renegotiate the lease, what are they negotiating-through-the-media for?

debt relief?

 

[kdb209]

now I am puzzled. if the projected $ 30 million USD loss is hyperbolic, and there is no need to renegotiate the lease, what are they negotiating-through-the-media for?

debt relief?

Another possibility is the message isn't directed towards the city, but towards the fans - as a precursor to offseason slash and burn salary dumps or significant price increases.

Anyone want to buy a slightly used Jovo-cop?

 

[Sotnos]

I understand your dilemna as a fan, but from the outside looking in it seems odd that they claim possible losses. I look at the Bolts, as a recent Stanley Cup winner and announcing 20,000 plus attendance, as an extremely strong NHL market....It's got nothing to do with the great fans the team has.

I had a nice big explanation (more like a rant!) with links and other goodies written up, but this thread is still presumably about Phoenix so this probably isn't the place for it and I'm sorry I dragged it off-topic already, but what kdb said really rang true to me. If anyone is truly fascinated (as if) by PS&Es lobbying for tax breaks or the parking revenue situation, let me know and I'll send you some stuff privately.

Thanks for the compliment anyway.

I'd say the Phoenix fans are probably just as devoted, but as an outsider looking in on the Coyotes, I do wonder just what in heck their "plan" is the past couple of years and wouldn't blame fans for wondering the same and speaking with their wallets about it.

 

[MAROONSRoad]

Gretzky: 'Yotes must improve; it's a "question of survival"

The $30 million figure surfaces again:

"It's easy to jump ship when things are not perfect," said Gretzky, who has four years left on his coaching contract. "The reality is you can't. At the end of the day, when you have success, it's much more rewarding when you've battled through tough times. Obviously, this has been a tough time for the entire organization and for hockey fans here in Phoenix. We had a $42 million payroll, lost a lot of money (about $30 million), and didn't win a lot of hockey games, so now it becomes a question of survival. We've got to build from within, and we've got to try to be patient when building (from) within."

http://www.azcentral.com/sports/coyotes//articles/0313coyotesnb0313.html

 

[razorsedge]

The salary cap has nothing to do with teams making money. The "smaller" market teams that were hurting the most before the lockout, are still spending more now than they did before, on salary's. The salary cap just spreads the high priced talent throughout the NHL, more so than before.

Revenue sharing helps teams that lost money to break even. Which is great to spread the wealth along with talent. But how long do you think the money making teams are gonna want to keep paying out millions to the same teams over and over again? The CBA still needs to be tweaked some more before every current NHL teams make money. If not, I think the current CBA may actually force relocation more than anything IMO.

Just to further prove my point, in an article with Dallas Stars president Jim Lites, he shows his dislike of the Nashville Predators.

"I understand it's a competitive situation, but we're also working together to sell the game," Lites told the paper. "They get more money from revenue sharing than any team in the league, they voted against the new schedule because they wanted to have an easier schedule for themselves. They take and take and take and take and never give back, and I'm sick of it."

http://sports.espn.go.com/nhl/news/story?id=2804125


I'm NOT posting this to crap on Nashville as a market (though I do have strong opinions of it), i'm just proving that the current CBA hasn't helped the smaller market teams financially, and will end up causing tension amongst owners having to pay out to the same teams over and over again. Phoenix's managemnet i'm sure didn't make any friends this year again with the possibility of a $30 million dollar loss.

 

[MAROONSRoad]

Just to further prove my point, in an article with Dallas Stars president Jim Lites, he shows his dislike of the Nashville Predators.

"I understand it's a competitive situation, but we're also working together to sell the game," Lites told the paper. "They get more money from revenue sharing than any team in the league, they voted against the new schedule because they wanted to have an easier schedule for themselves. They take and take and take and take and never give back, and I'm sick of it."

http://sports.espn.go.com/nhl/news/story?id=2804125


I'm NOT posting this to crap on Nashville as a market (though I do have strong opinions of it), i'm just proving that the current CBA hasn't helped the smaller market teams financially, and will end up causing tension amongst owners having to pay out to the same teams over and over again. Phoenix's managemnet i'm sure didn't make any friends this year again with the possibility of a $30 million dollar loss.

If I recall correctly, there are performance targets in the CBA (i.e., revenue growth or paid attendance growth) that must be met by teams that receive revenue sharing or else they receive a smaller amount of revenue sharing each year.

You are right, though, the new CBA has not been a cure-all. With the CAP bands you have a floor which has actually forced some of the lower revenue teams to INCREASE their payroll. Team owners have claimed losses of around 30 million (Phoenix), 19 or 20 million (Chicago), 9 million if they don't make the playoffs (Tampa Bay). Carolina reportedly broke even last year during their Conference Final with Buffalo for the first time since moving from Hartford. The Oilers owners claim they will break even but that's after raising ticket prices 21% this year. There are in fact only a handful of teams in the NHL that make money on hockey operations year in year out whether they make the playoffs or not and they are the ones with large TV contracts.

GHOST

 

[Ted Hoffman]

Those targets start next year, teams who wouldn't qualify for a full share in 2006-07 will be notified this summer. To get a full share in 2007-08, teams must
A. have a year-to-year revenue growth rate that exceeds the league's growth rate, and
B. have a paid average attendance that is at least 13,125 or the average leaguewide paid attendance (whichever is less). [This jumps to the lesser of 14,000 or the avg. league paid attendance for 2008-09 and beyond.]

Teams who qualify for revenue sharing in 2007-08 but don't achieve both of these targets will only get 75% of the eligible amount; teams who subsequently fail to hit both targets in 2 consecutive years will only get 60% of the eligible amount in the 2nd year, and teams who fail to hit both targets in 3 consecutive years will only get 50% of the eligible amount in the 3rd year.

Source: Article 49.3(d)

 

[AdmiralPred]

Just to further prove my point, in an article with Dallas Stars president Jim Lites, he shows his dislike of the Nashville Predators.

"I understand it's a competitive situation, but we're also working together to sell the game," Lites told the paper. "They get more money from revenue sharing than any team in the league, they voted against the new schedule because they wanted to have an easier schedule for themselves. They take and take and take and take and never give back, and I'm sick of it."

http://sports.espn.go.com/nhl/news/story?id=2804125


I'm NOT posting this to crap on Nashville as a market (though I do have strong opinions of it), i'm just proving that the current CBA hasn't helped the smaller market teams financially, and will end up causing tension amongst owners having to pay out to the same teams over and over again. Phoenix's managemnet i'm sure didn't make any friends this year again with the possibility of a $30 million dollar loss.

What does this quote do, but show an emotional team president spouting remarks off the cuff? It doesn't further your point (which I did not catch in this thread) other than a team executive has ill feelings towards revenue sharing and one of the teams that receives it wouldn't announce his player's achievments over the P.A.

 

[KeydGV21]

Those targets start next year, teams who wouldn't qualify for a full share in 2006-07 will be notified this summer. To get a full share in 2007-08, teams must
A. have a year-to-year revenue growth rate that exceeds the league's growth rate, and
B. have a paid average attendance that is at least 13,125 or the average leaguewide paid attendance (whichever is less). [This jumps to the lesser of 14,000 or the avg. league paid attendance for 2008-09 and beyond.]

Teams who qualify for revenue sharing in 2007-08 but don't achieve both of these targets will only get 75% of the eligible amount; teams who subsequently fail to hit both targets in 2 consecutive years will only get 60% of the eligible amount in the 2nd year, and teams who fail to hit both targets in 3 consecutive years will only get 50% of the eligible amount in the 3rd year.

Source: Article 49.3(d)

Is there anything in there for term A if say the Maple Leafs decided to really gouge their paying customers or if multiple buildings were built in the same year? I'm not sure what the numbers would have to be, of if it'd even be pratical, but it seems like the league could be stagnant overall but 3 or 4 teams have big revenue increases and a team that grows more then 75% of the league wouldn't qualify.

If a struggling team were to move in to Kansas City the same year Pittsburgh gets their new building it seems like they could unfairly distort the league growth and harm the teams who would qualify for revenue sharing otherwise.

What does this quote do, but show an emotional team president spouting remarks off the cuff? It doesn't further your point (which I did not catch in this thread) other than a team executive has ill feelings towards revenue sharing and one of the teams that receives it wouldn't announce his player's achievments over the P.A.

I think that was his point. If and when teams get large amounts of revenue sharing for a number of years it's quite possible that there is going to be a divide between the owners that make money and the owners that lose money. If this divide becomes big enough it would start to make sense for the owners that make money to push for contraction or relocation rather then continuing to subsidize the markets that aren't making money.

It’s obviously far to early in the CBA to see which teams will continually get revenue sharing but if enough owners start to see their own bottom line getting hurt by having to pay for the same market(s) year after year it has the potential to be very ugly for the league. In the case of Dallas towards Nashville it appears as though it’s already moving towards that point, though obviously the schedule vote hasn't helped in that situation either.

 

[Ted Hoffman]

Is there anything in there for term A if say the Maple Leafs decided to really gouge their paying customers or if multiple buildings were built in the same year? I'm not sure what the numbers would have to be, of if it'd even be pratical, but it seems like the league could be stagnant overall but 3 or 4 teams have big revenue increases and a team that grows more then 75% of the league wouldn't qualify.

It says, "league growth rate". Sure, Toronto could gouge the crap out of Leafs fans to pump up revenues - but if another team really struggles at the gate and NHL merchandise sales drops, that gounging would be dampened. Put another way: if we have $2.2B in revenues with the Leafs counting $150M and they jump 50% and everyone else jumps 4%, you're only at $2.357B - which would be a 7.1% in league revenues. Now let's say Detroit at $130M in revenues also jumps up 50%. That would make league revenues about $2.417B - which would be a 9.85% increase in league revenues. But if there's $250M in league merchandise sales and that total drops to $200M, then the increases only come to 4.9% and 7.6% respectively.

The point is that a couple teams gouging could have a short-term impact on the league's growth rate - but it would/could be mostly dampened ... especially if everyone else didn't grow at the same rate. Would it really be worth it long-term for those franchises to gouge for the present while likely burning goodwill with their fans, especially since that gouging still wouldn't allow them to spend more on player salaries and would just be seen as "owners trying to line their pockets" by the fans? Besides, it would most likely be a one-time bump; it's doubtful that those teams could sustain much growth the next year, and thus the league's growth rate the following year would very likely be lower.

In short: no, there's nothing in the CBA that prevents this from happening - but logic says that one team artificially trying to inflate revenues to keep some other team from getting a full share of revenue sharing will more than likely result in ill will from their fans, something that would have more of a negative impact than the gain from keeping someone from getting a full share.

 

[KeydGV21]

It says, "league growth rate". Sure, Toronto could gouge the crap out of Leafs fans to pump up revenues - but if another team really struggles at the gate and NHL merchandise sales drops, that gounging would be dampened. Put another way: if we have $2.2B in revenues with the Leafs counting $150M and they jump 50% and everyone else jumps 4%, you're only at $2.357B - which would be a 7.1% in league revenues. Now let's say Detroit at $130M in revenues also jumps up 50%. That would make league revenues about $2.417B - which would be a 9.85% increase in league revenues. But if there's $250M in league merchandise sales and that total drops to $200M, then the increases only come to 4.9% and 7.6% respectively.

The point is that a couple teams gouging could have a short-term impact on the league's growth rate - but it would/could be mostly dampened ... especially if everyone else didn't grow at the same rate. Would it really be worth it long-term for those franchises to gouge for the present while likely burning goodwill with their fans, especially since that gouging still wouldn't allow them to spend more on player salaries and would just be seen as "owners trying to line their pockets" by the fans? Besides, it would most likely be a one-time bump; it's doubtful that those teams could sustain much growth the next year, and thus the league's growth rate the following year would very likely be lower.

In short: no, there's nothing in the CBA that prevents this from happening - but logic says that one team artificially trying to inflate revenues to keep some other team from getting a full share of revenue sharing will more than likely result in ill will from their fans, something that would have more of a negative impact than the gain from keeping someone from getting a full share.

I understand what your saying but on the one team gouging prices but that still leaves out multiple teams opening new arena/ moving in the same season. Something that almost happened next season with the Devils getting their new rink and Pittsburgh moving and something that could still happen with Pittsburgh getting a new rink and someone else moving to Kansas City.

It still seems unlikely this would have an effect but I'm surprised there isn't some sort of clause for it. I assume then there is nothing in there in regards to expansion teams as well?

 

[Ted Hoffman]

I'll look again, but I'm pretty sure the answer is "no".

AFA teams moving into new arenas: after the Pens and Devils go, the only teams with arenas built before 1990 will be Detroit, Edmonton, Calgary, the Islanders, and the Rangers. I'm 99% sure that EVERYONE else will have an arena built in 1993 or later; of those 5, the Isles are the only team with plans for a new arena in the works.

 

[OG6ix]

I hear the Joe is getting major upgrades though. There is something about a new MSG out there too.

 

[Willis]

There is talk here in Edmonton for a new downtown arena.

 

[KeydGV21]

I'll look again, but I'm pretty sure the answer is "no".

AFA teams moving into new arenas: after the Pens and Devils go, the only teams with arenas built before 1990 will be Detroit, Edmonton, Calgary, the Islanders, and the Rangers. I'm 99% sure that EVERYONE else will have an arena built in 1993 or later; of those 5, the Isles are the only team with plans for a new arena in the works.

I know it's a rare occurance but you'd think with all the time spent on it and all the lawyers working on the project they'd look at every possible situation. Maybe they did and decided it wasn't worth it though?

There is talk here in Edmonton for a new downtown arena.

I know that's still in very early stages, but isn't that something that's going to be linked to a new arena for Calgary as well?

 

[GSC2k2*]

I know it's a rare occurance but you'd think with all the time spent on it and all the lawyers working on the project they'd look at every possible situation. Maybe they did and decided it wasn't worth it though?

I can tell you that when we are drafting contracts for any kind of deal, we generally avoid drafting for scenarios which involve a party slitting their own throat, as is the case in your gouging scenario above.

We also avoid the "meteor hitting the earth" scenarios such as you outlined above with your multiple new arenas scenario.

Otherwise, contracts would be 12,000 pages long.

 

[puckhead103*]

Phoenix has a ton of corporate support. Jerry Moyes, owner of Swift Transportation, owns the team and subsequently their plane they fly on. No, concessions are actually a little high but not too bad. We actually have the best lease in the NHL and get all hockey related revenue from the arena. There is NO way they stand to lose 30 million. Gambodoro is a moron and consistently gets everything he reports wrong. He is the AZ Republic version of Eklund or Garrioch. A monkey could whisper in his ear that Gretzky will play and he would report it as the holy gospel truth.

Plus, Wayne has come out and said they will be players in the free agent market, even after this 30 million loss claim. Quite frankly I'm getting tired of sore Winnipegers and Canadian elitists who think that hockey doesn't belong here or anywhere in the lower 48.

 

[Willis]

I know that's still in very early stages, but isn't that something that's going to be linked to a new arena for Calgary as well?

No they would not be linked. Each is on its own merits. The mayor of Edmonton has already come out in favor of it as has the oilers. I believe it may be part of a 1 billion dollar project downtown.

 

[KeydGV21]

No they would not be linked. Each is on its own merits. The mayor of Edmonton has already come out in favor of it as has the oilers. I believe it may be part of a 1 billion dollar project downtown.

My mistake, I thought I read something about it being linked up as some sort of bill that would be voted upon Province wide.