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New Arena deal agreed to by city and Katz group:mod warning #616

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05-09-2013, 01:43 AM
  #826
Behind Enemy Lines
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Interesting article in Slate about the Sacramento Kings sale and point of view about big picture objectives of league owners as it goes for buildings: http://www.slate.com/blogs/moneybox/...subsidies.html

What we've seen in Edmonton:
- bullying owner pushing his plan and controls over a so called public infrastructure hoarding all revenue streams and cozy lease
- Idle threat to move out of a monopoly, top tier revenue generating market to the greener pastures of Seattle
- big donations to ruling provincial government in violation of allowed limitations
- full frontal PR assault to instil urgency and sway gullible public opinion by rights holder broadcast employees and a quasi downtown 'citizen group' whose passionate, articulate leader is outed to have big financial gain in the new development going through.

The current rink is old and doesn't hold up to modern facility cash cows that municipalities are tripping over themselves to subsidize for anchor sport tenants. This whole process has been heavy handed under the auspices of 'the public good' and 'the public need'. It boggles my mind to hear and read civic officials being hammered over trying to manage public money in a situation in which a billionaire has consistently dictated terms and conditions throughout.

Hearing and reading some hockey fans suggest quibbling over a difference of $50,000,000 like it is pennies under a sofa is startling. It might have all been different had Edmonton's city council not always faced gunboat diplomacy throughout this whole process.

Instead it comes across as somehow standing in the way of progress versus standing up for the best interests of all Edmontonians and a public purse civic and provincial that is stretched.


Last edited by Behind Enemy Lines: 05-09-2013 at 01:49 AM.
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05-09-2013, 02:40 AM
  #827
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Originally Posted by Behind Enemy Lines View Post
Interesting article in Slate about the Sacramento Kings sale and point of view about big picture objectives of league owners as it goes for buildings: http://www.slate.com/blogs/moneybox/...subsidies.html

What we've seen in Edmonton:
- bullying owner pushing his plan and controls over a so called public infrastructure hoarding all revenue streams and cozy lease
- Idle threat to move out of a monopoly, top tier revenue generating market to the greener pastures of Seattle
- big donations to ruling provincial government in violation of allowed limitations
- full frontal PR assault to instil urgency and sway gullible public opinion by rights holder broadcast employees and a quasi downtown 'citizen group' whose passionate, articulate leader is outed to have big financial gain in the new development going through.

The current rink is old and doesn't hold up to modern facility cash cows that municipalities are tripping over themselves to subsidize for anchor sport tenants. This whole process has been heavy handed under the auspices of 'the public good' and 'the public need'. It boggles my mind to hear and read civic officials being hammered over trying to manage public money in a situation in which a billionaire has consistently dictated terms and conditions throughout.

Hearing and reading some hockey fans suggest quibbling over a difference of $50,000,000 like it is pennies under a sofa is startling. It might have all been different had Edmonton's city council not always faced gunboat diplomacy throughout this whole process.

Instead it comes across as somehow standing in the way of progress versus standing up for the best interests of all Edmontonians and a public purse civic and provincial that is stretched.
I actually don't find the progress/anti-progress stuff all that frustrating. That stuff crops up in every debate and tends to be a side argument that has nothing to do with actual arena debate - which is usually who pays for it, and how many concessions the guy with the leverage(the owner usually) can wring out of the public purse.

What is frustrating is how parochial people get in every arena debate. As if this is the first time an owner has ever demanded public money for arenas and is somehow especially evil for following what are now time tested public negotiating tactics, or the threats to move the team(implied or blatant) are in any capacity hollow in nature.

I'm glad to see the people Sacramento get to keep their team, and in 5 years no one in Sacramento will remember that to continue enjoying their NBA team required the complete capitulation of their public servants to small exclusive group of billionaires. You can also pretty much guarantee that within a few years Seattle will be back in the running for another franchise, just have to look down the NBA list of teams that haven't gotten an updated arena recently.

Sadly, those types of situations foreshadow what will happen in Edmonton if this current deal falls through(not that I think it will), there are just too many cities out there willing to open the vault for that elusive and abstract title of being a "World Class City".


Last edited by Tarus: 05-09-2013 at 02:54 AM.
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05-09-2013, 02:41 AM
  #828
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Except that a new owner won't necessarily be willing to put up money for a new arena.
Not questioning your reply, but looking for some confirmation from you or whomever knows. What money is Katz really putting up? All I've heard is that he is going to lease the building for a total of $115M over 35 years. He will get all operating revenues from the parking, concessions, naming rights and tickets(other than ticket tax). The city will own the building and maintain it but the Oilers will operate it.

Is he actually putting any money into the project or providing land? I am specifically asking about the arena part of the project.

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05-09-2013, 02:46 AM
  #829
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Originally Posted by timekeep View Post
Not questioning your reply, but looking for some confirmation from you or whomever knows. What money is Katz really putting up? All I've heard is that he is going to lease the building for a total of $115M over 35 years. He will get all operating revenues from the parking, concessions, naming rights and tickets(other than ticket tax). The city will own the building and maintain it but the Oilers will operate it.

Is he actually putting any money into the project or providing land? I am specifically asking about the arena part of the project.
The city has a whole webpage devoted to this.

http://www.edmonton.ca/city_governme...agreement.aspx

Katz also bought the land, and sold it to the city a while ago as well.

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05-09-2013, 03:02 AM
  #830
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The city has a whole webpage devoted to this.

http://www.edmonton.ca/city_governme...agreement.aspx

Katz also bought the land, and sold it to the city a while ago as well.
Perfect, thanks.

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05-09-2013, 07:43 AM
  #831
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The city has a whole webpage devoted to this.

http://www.edmonton.ca/city_governme...agreement.aspx

Katz also bought the land, and sold it to the city a while ago as well.
A quick flip with a tidy profit. Poor Katz.

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05-09-2013, 08:51 AM
  #832
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A quick flip with a tidy profit. Poor Katz.
And his big commitment to the project is an agreement to pay rent for 35 years that's it. With all the extra sources of revenue the city is giving up to Katz it's no investment at all.

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05-09-2013, 09:44 AM
  #833
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Oh, and who is going to step in and save the Oilers when it comes down to it? Bettman won't, he's already stated that the league is not interested in another "Save the Oilers" campaign. If this falls through, and Katz wants out, well then the new Quebec team will probably come from Edmonton instead of Phoenix.
LOL. The NHL will just run the team to counter the money they loss in PHX.

Or there will be a Craig Leipold situation.

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05-09-2013, 09:50 AM
  #834
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And his big commitment to the project is an agreement to pay rent for 35 years that's it. With all the extra sources of revenue the city is giving up to Katz it's no investment at all.
Your assumption that the city would turn a profit on those extra sources of revenue is a bad one.

This just in: governments do a poor job of operating businesses.

A group of people willing to take on the operating risks of a new event centre is as necessary as the new event centre.

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05-09-2013, 10:21 AM
  #835
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Originally Posted by Tarus View Post
The city has a whole webpage devoted to this.

http://www.edmonton.ca/city_governme...agreement.aspx

Katz also bought the land, and sold it to the city a while ago as well.
so if they simply scrapped the winter garden then boom, we'd be in business

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05-09-2013, 10:47 AM
  #836
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And his big commitment to the project is an agreement to pay rent for 35 years that's it. With all the extra sources of revenue the city is giving up to Katz it's no investment at all.
I've never liked this deal, he is taking the citizens of Edmonton to the cleaners and he knows it. His behavior has been abhorent, tugging on the emotional attachment of Edmontonians to this team and his continuous (hollow) threats of moving.

Well Mr. Katz, if life is so bad here, move your team. We will get another.

Despite the foregoing, I believe in the project. I just believe we need a fair deal. I also believe if the Provincial Government didn't view this as a massive subsidy to a private individual they would participate. The city needs to build the arena on its own .... if Katz wants to move in fine, negotiate fair terms. If not, stay at Northlands or move.

Funny, the naming rights alone could be worth more than Katz's entire contribution plus the shortfalll. How stupid is our mayor?

http://www.cbc.ca/news/background/marketing/

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05-09-2013, 10:54 AM
  #837
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Wierd.

I don't live in Edmonton anymore, so I don't follow closely what's going on with this ordeal. But it seems every few months for the past few years I swear I've read something about it FINALLY getting done, and they've moved past all the hurdles, and it will begin construction.

Then a few months later, I read about another ordeal that had been dealt with and now they are FINALLY able to move past that ordeal, and begin construction. I swear! From what I had read, this entire schtick had been settled 5 or 6 times now.

After the current provincial funding fiasco is settled, what's next? Does the arena finally get built? Or do 15 or 20 more things have to be settled?

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05-09-2013, 11:16 AM
  #838
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What's ridiculous is that the Province could easily justify this if they chose to actually be leaders. If the Province loses the Oilers, they will lose almost 5.0M a year in personal tax dollars from professional hockey players (trying to account for some deductions), and further if you take it to a federal level and assume that the Oilers would leave to Seattle, the federal government would lose 14.5M per year. There is more than enough incentive and justification there alone to build a case for support, especially considering the 35 year location agreement.

This completes ignores the fact that Katz has contributed greatly to the City of Edmonton. The fact he is looking to make a smart business decision does not make him evil My best bet, is the majority of people's response stem from jealously as it is asinine beyond comprehension that he would build a city building for the benefit of the citizens (including himself and his family), the local businesses, the tourism industry, and the City from a recognition standpoint just cause he is a billionaire, and foot the entire bill. I can't wait till 7 years from now and the rally's start to attempt to bring back a professional team to Edmonton, and the City will aim to pay the entire bill for a new downtown arena complex. That is going to be irony in its finest.

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05-09-2013, 11:17 AM
  #839
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Your assumption that the city would turn a profit on those extra sources of revenue is a bad one.

This just in: governments do a poor job of operating businesses.

A group of people willing to take on the operating risks of a new event centre is as necessary as the new event centre.
Northlands seems to do well enough with their concert business at the current location.

Katz gets the new arena and the new business and doesnt pay any of the maintenance just a small lease payment that anyone operating the team could handle given the current economics and if the team started making the playoffs it should be a huge windfall. Katz isnt a savior here riding in on a white horse to save hockey in Edmonton and this deal is one that members of the EIG could easily have handled. They would have needed to restructure their membership but it was certainly possible.

Having said all that I'm not against the deal as it stands. I do think asking Katz to put more security into the deal to make it work is plausible. Staples recent suggestion that making contingent on the growth figures for the CRL is reasonable.

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05-09-2013, 11:20 AM
  #840
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Northlands seems to do well enough with their concert business at the current location.
.
Not hard to do well when the city gives you money for everything you do and want.

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05-09-2013, 11:24 AM
  #841
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What's ridiculous is that the Province could easily justify this if they chose to actually be leaders. If the Province loses the Oilers, they will lose almost 5.0M a year in personal tax dollars from professional hockey players (trying to account for some deductions), and further if you take it to a federal level and assume that the Oilers would leave to Seattle, the federal government would lose 14.5M per year. There is more than enough incentive and justification there alone to build a case for support, especially considering the 35 year location agreement.

This completes ignores the fact that Katz has contributed greatly to the City of Edmonton. The fact he is looking to make a smart business decision does not make him evil My best bet, is the majority of people's response stem from jealously as it is asinine beyond comprehension that he would build a city building for the benefit of the citizens (including himself and his family), the local businesses, the tourism industry, and the City from a recognition standpoint just cause he is a billionaire, and foot the entire bill. I can't wait till 7 years from now and the rally's start to attempt to bring back a professional team to Edmonton, and the City will aim to pay the entire bill for a new downtown arena complex. That is going to be irony in its finest.
Pro hockey players in most cases take more money out of the economy than they put in. As for the province they simply in no way shape or form can afford to openly contribute to something like this at this time. Don't even bother to bring it up.

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05-09-2013, 11:25 AM
  #842
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Not hard to do well when the city gives you money for everything you do and want.
Which is what they are going to be doing for katz and the oilers.

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05-09-2013, 11:43 AM
  #843
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Well Mr. Katz, if life is so bad here, move your team. We will get another.
Maybe we will, maybe we won't.

I'd say the odds would be good to very good that Edmonton could get another team...but I think it's naive and frankly arrogant to sit back and smugly suggest that the NHL would stumble all over themselves to move another team right away. IMO we'd be looking at least a couple years wait before another team was relocated, perhaps longer. And that's fine, just as long as people are cognizant of that possibility.

I also think that if the Oilers left, the NHL would much prefer to create an expansion franchise and cash in on expansion fees here rather than move an existing team. So then you have to ask who around here would put up that amount of cash right off the top, and to boot for a team that would start out with one of the oldest, smallest buildings in the NHL. If I were a billionaire looking to get in on the NHL with an expansion team, personally I'd prefer going somewhere like Markham or Quebec City where at least the building wouldn't be a piece of garbage in comparison to what other Canadian teams enjoy.

And that's to speak nothing of having to start all over again with an expansion team that'll likely be bottom of the barrel for who knows how long. It might be a quick turnaround, it might not. There's absolutely no guarantee of what Edmonton would be stuck with.

Don't get me wrong, this isn't meant to say that Katz should just get whatever he wants, whenever he wants. He's bungled things from his end, and I agree that he could stand to put a bit more of his own skin into this venture if he needs it so badly. But at least he's trying to get an arena built, which is something that the EIG was NEVER going to do. I'd have no problem with Katz selling the team to some White Knight who'd come in here and build this thing 100% privately, but I'm having a hard time visualizing who would do that...especially someone who's local.

I guess I just think it's a flippant attitude when it's suggested "Move the team, we'll get another!" like it's no big deal. I think it would be a big deal, and it would not be painless. Fans may be unpleasantly surprised at what the outcome would be.

And let's be clear, the only reasons that NHL hockey works in Edmonton as of today is because of the very high ticket prices being charged (4th highest in the NHL), along with the Canadian dollar being at or close to par with the US dollar. Doesn't that strike someone as a rather tenuous position that only stands to worsen in 5-10 years time with the team stuck in an old, small building while player salaries go nowhere but up by leaps and bounds? There's next to zero growth potential, which is what it boils down to from the NHL's perspective.

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05-09-2013, 11:47 AM
  #844
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Pro hockey players in most cases take more money out of the economy than they put in.
Not to dispute it as I've honestly never heard of this argument before, but what is this based on?

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05-09-2013, 11:54 AM
  #845
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Not to dispute it as I've honestly never heard of this argument before, but what is this based on?
Money they get comes from the locals the athlete is more likely to spend a larger portion of that cash elsewhere. Net effect, money moving outwards.

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05-09-2013, 11:57 AM
  #846
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A quick flip with a tidy profit. Poor Katz.
Not only that, he gets the use of that Land of course.
Joke is, that Land isnt worth much without the new arena

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05-09-2013, 11:58 AM
  #847
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so if they simply scrapped the winter garden then boom, we'd be in business
Oh no, Katz really needs that for his own development. So no, we have to have it.

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05-09-2013, 12:16 PM
  #848
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Capital Region board approves $25M grant towards downtown arena complex

Just saw this from an Edmonton Journal 'breaking news' e-mail:

Capital Region Board votes to support grant application for downtown arena

By the narrowest of margins, the Capital Region Board has voted to support Edmontonís application for a grant of $25 million over three years for the downtown arena. More to come Ö

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05-09-2013, 12:28 PM
  #849
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Get this thing done!!

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05-09-2013, 12:32 PM
  #850
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What about the other 30 mil?

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