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Bills Hire Firm for Stadium Facelift


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The state has to allocate the money they currently get for no renovations--and give it back to the Bills as free renovations?? Where does that money come out of? They take it away from who or what that it was already earmarked for? You can't answer this. The answer is that the state budget never gets smaller--only ever larger. Only increased taxes will cover this renovation.

 

Why did you bring up the hospital then? To inadvertently point out how the hospital subsidizes the state by caring for some of it's citizens at below cost? How is that related to Mr. Wilson and his billion dollar private enterprise demanding another free stadium upgrade?

How did the state fund the $63M renovations to The Ralph back in 1998?

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It's not self funding. So not semantics,

While the money likely won't be directly deposited in the "pay-off $100M RWS renovation" jar (and who know, maybe it will?), it will be applied to it. Instead of "already being spent" on other things. Semantics.

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The 100m dollars is worth it to the state, why are we still talking about this?

I agree it is worth it to the Buffalo area, particularly if the rest of the state is footing the Bill.

I do not agree it is worth it to the state.

But no doubt the state will pay just like they did the Mets stadium referenced earlier. Whats a little more government waste huh. :sick:

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It's just Doc and Weo having their usual disagreements. No big deal.

;)

I agree it is worth it to the Buffalo area, particularly if the rest of the state is footing the Bill.

I do not agree it is worth it to the state.

But no doubt the state will pay just like they did the Mets stadium referenced earlier. Whats a little more government waste huh. :sick:

Government waste is a whole different issue. If the Bills generated no money for the state, it would truly be a waste.

 

Ideally all sports owners would be required to spend their own money. But when sports owners have options and it's the choice between spending money to keep the team and the revenue it generates, versus not spending money and losing teams and millions in revenue, you have to spend the money.

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;)

 

Government waste is a whole different issue. If the Bills generated no money for the state, it would truly be a waste.

 

Ideally all sports owners would be required to spend their own money. But when sports owners have options and it's the choice between spending money to keep the team and the revenue it generates, versus not spending money and losing teams and millions in revenue, you have to spend the money.

What a concept huh, business owners paying for their own place of business ;).

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;)

 

Government waste is a whole different issue. If the Bills generated no money for the state, it would truly be a waste.

 

Ideally all sports owners would be required to spend their own money. But when sports owners have options and it's the choice between spending money to keep the team and the revenue it generates, versus not spending money and losing teams and millions in revenue, you have to spend the money.

If I was as convinced like you are that the Bills were going to be moved without a 100 million grant from the state, then I would probably agree it would be worth it, even if it brings no new or extra revenue (it won't likely) to the state to pay for it.

 

Ralph has played this ransom card before.

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If I was as convinced like you are that the Bills were going to be moved without a 100 million grant from the state, then I would probably agree it would be worth it, even if it brings no new or extra revenue (it won't likely) to the state to pay for it.

 

Ralph has played this ransom card before.

Ralph won't move the team. As I've said and jw has corroborated, he's had chances to move but never took them, and has voted against every relocation. The issue is locking the team into a lease that makes it incredibly unpalatable for a new owner to move the team.

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Ralph won't move the team. As I've said and jw has corroborated, he's had chances to move but never took them, and has voted against every relocation. The issue is locking the team into a lease that makes it incredibly unpalatable for a new owner to move the team.

Which also makes it incredibly unpalatable for a new owner to even buy the team.

If that were to happen the family would have to lower the price to the point someone would buy the team.

In any event this renovation has little to no bearing on the Bills relocating or not, IMHO.

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If you think the money the Bills generate is mostly through sales tax, you're barking up the wrong tree.

We have some new information:

 

http://www.buffalonews.com/sports/bills-nfl/article608931.ece

 

The county this year budgeted $2.8 million in maintenance costs for the stadium and an additional $4.3 million for game day expenses.

 

Collins said that he will not publicly discuss the conversations he has had with the Bills but that he would be willing to continue to "absorb what could be considered a $1.5 million direct loss on my budget."

 

How does he arrive at that figure? He said the county takes in about $10 million in sales tax each year related to the Bills. In turn, it passes on about $4.5 million of that sales tax revenue to towns, villages and school districts. That leaves about $5.5 million a year in Bills-related sales tax for the county -- about $1.5 million less than the subsidy the county pays to the Bills.

 

"Could they ask for something more?" Collins said. "I suppose, but I've been in too close of talks with them to expect that. That's just not how they operate."

 

Collins' office estimates that the state takes in $20 million to $25 million in direct revenue from the Bills through taxes.

 

So it's pretty clear that Collins is simply using the estimated "gross" sales taxes generated by Bills-related spending, and totally ignoring the fact that people would spend at least part of the same funds on other things that would generate sales tax for Erie County anyway even if the Bills left.

 

We also know that in Erie County, total sales tax is 8.75% - - split 4.75% to the county and 4.0% to the state:

 

http://www.earthodyssey.com/sales_tax.htmle

 

So if Collins estimates that the County gets $10 million in sales tax each year related to the Bills (at 4.75%), then he must figure that the state takes in $8,421,053 (at 4.0%) in sales tax on the exact same sales.

 

The Collins estimate of "direct" tax revenue to the state somehow jumped from (i) $20 million, to (ii) $20 to $25 million. So let's call it $22.5 million.

 

Here's how it breaks down so far on an annual basis (according to Collins):

 

1. $10 million to the county in sales tax;

 

2. $8.421 million to the state in sales tax; and

 

3. $14.079 million to the state in unspecified other taxes.

 

So based on Collins' own comments, annual sales tax revenues for the state and county combined amount to $18.421 million, while all other taxes add up to $14.079 million.

 

We still don't know exactly how Collins calculates the $14.079 million figure - - seems like it should include NY income taxes paid by players and other employees of the Bills' organization (excluding those employed in Michigan), and any corporate NY income taxes paid by Buffalo Bills, Inc. on the team's annual profit.

 

But if you believe Collins' own description of the "study," it appears I was barking up the right tree after all.

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We have some new information:

 

http://www.buffalonews.com/sports/bills-nfl/article608931.ece

 

 

 

So it's pretty clear that Collins is simply using the estimated "gross" sales taxes generated by Bills-related spending, and totally ignoring the fact that people would spend at least part of the same funds on other things that would generate sales tax for Erie County anyway even if the Bills left.

 

We also know that in Erie County, total sales tax is 8.75% - - split 4.75% to the county and 4.0% to the state:

 

http://www.earthodyssey.com/sales_tax.htmle

 

So if Collins estimates that the County gets $10 million in sales tax each year related to the Bills (at 4.75%), then he must figure that the state takes in $8,421,053 (at 4.0%) in sales tax on the exact same sales.

 

The Collins estimate of "direct" tax revenue to the state somehow jumped from (i) $20 million, to (ii) $20 to $25 million. So let's call it $22.5 million.

 

Here's how it breaks down so far on an annual basis (according to Collins):

 

1. $10 million to the county in sales tax;

 

2. $8.421 million to the state in sales tax; and

 

3. $14.079 million to the state in unspecified other taxes.

 

So based on Collins' own comments, annual sales tax revenues for the state and county combined amount to $18.421 million, while all other taxes add up to $14.079 million.

 

We still don't know exactly how Collins calculates the $14.079 million figure - - seems like it should include NY income taxes paid by players and other employees of the Bills' organization (excluding those employed in Michigan), and any corporate NY income taxes paid by Buffalo Bills, Inc. on the team's annual profit.

 

But if you believe Collins' own description of the "study," it appears I was barking up the right tree after all.

If we take the ~$8.5M the state gets from sales tax and subtract it from the $22.5M the state makes in total tax revenue, that leaves a difference of $14M in "other tax income." If we use the same split as for sales tax (~55%/45%), you get $17M going to the county in "other tax income." That's a total of $31M, versus $18.5M in sales tax income. So the "other tax income" as I said is the major portion.

 

As for the sales tax, if the Bills were gone, it's conjecture as to how much the sales tax income would still be generated. But roughly 20% of people in the stands at Bills games are from Canada (that's $3.7M gone right there), and sometimes there are about 20% fans from other teams, depending on the game. And an outing to a Bills game, while the cheapest in the NFL, still costs quite a bit for those 7 Sundays, and likely wouldn't be replaced by any activity on Sunday that would replace it.

 

Bottom line is that the state makes $20-25M on the Bills in total tax revenue. So funding the stadium, like they did in 1998, is worthwhile.

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If we take the ~$8.5M the state gets from sales tax and subtract it from the $22.5M the state makes in total tax revenue, that leaves a difference of $14M in "other tax income."

 

This much I agree with, and all of that $14 million goes to the state.

 

If we use the same split as for sales tax (~55%/45%), you get $17M going to the county in "other tax income." That's a total of $31M, versus $18.5M in sales tax income. So the "other tax income" as I said is the major portion.

 

This part I disagree about. Two points:

 

First, I'm unclear why you assume that any tax money paid to the state gets divided up, with 55% of the total going back to Erie County, and the state keeping only 45% of the total. How do you justify that asumption? If the state paid ANY money back to the County, why is Collins talking about the County running a $1.5 million deficit per year with respect to the Bills?

 

Second, you, me and Collins are all using annual figures. Collins said that the annual direct revenue to the County from all Bills-related activity is $10 million, and the annual direct revenue to NY state from all Bills-related activity is $22.5 million. So when you and I try to figure out exactly where that money goes, and we break it into different categories, at the end of the analysis it still has to total $10 million + $22.5 million = $32.5 million per year.

 

My breakdown still adds up to a total of $32.5 million, just like Collins. But your numbers don't. You ultimately wind up concluding that there is $18.5 million in sales tax (just like me), but $31 million of "something else." That makes a total of $18.5 million + $31 million = $49.5 million. How can that be right?

 

As for the sales tax, if the Bills were gone, it's conjecture as to how much the sales tax income would still be generated. But roughly 20% of people in the stands at Bills games are from Canada (that's $3.7M gone right there), and sometimes there are about 20% fans from other teams, depending on the game.
I agree that the best we can do here is make estimates, and I also agree that SOME sales tax revenue would be lost on a net basis. Precisely as you point out, Canadians and out of state visitors are not likely to spend money in NY state if the Bills leave NY. You suggest that the percentage of non-NY residents at the Ralph can run as high as 40%. Even if your 40% estimate is correct, that still leaves 60% of the game day fans who live in NY and will make at least some substitute purchases that generate other sales tax revenue. But Collins assumes that NONE of the lost sales tax revenue would be replaced by other in-state purchases. That can't be right. Just because we can't precisely calculate the replacement sales tax revenue, that doesn't mean we should assume it doesn't exist at all.

 

And an outing to a Bills game, while the cheapest in the NFL, still costs quite a bit for those 7 Sundays, and likely wouldn't be replaced by any activity on Sunday that would replace it.
Why do you assume that the replacement activity has to take place on those 7 Sundays? Doesn't sales tax get paid on purchases every day of the week?

 

Bottom line is that the state makes $20-25M on the Bills in total tax revenue. So funding the stadium, like they did in 1998, is worthwhile.

We know that Collins use of gross sales tax figures, rather than a more accurate net loss figure, is inaccurate. I'd like to see the details for his analysis of other types of tax revenue before deciding if public funding of the proposed stadium improvements makes financial sense.

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