Donn Esmonde Agenda

[dwight in philly]

Where do you think they would play during a retro-fit? That might, ultimately, be a viable option, but I think a temproray location would be a serious issue. There is no stadium locally (southern ontario, wny, cny) that is close to NFL caliber.

do it like K C and green bay did it.. two steps.. work within the framework of the reality of how they did it.. climates are much the same.. should not be a problem..

[Billsguy]

He's only saying what most taxpayers are thinking.

Doesn't everyone feel rich owners should pay for their own damn stadiums?

Is there anyone who is fine with giving Trump or his ilk their tax dollars to become richer?

 

I can imagine a bunch of NFL owners sitting around laughing at how they get dumb*ss taxpayers to subsidize their toys. Taxpayers should let these billionaire owners support themselves. The fans support the team, but the owners should pay for their private playgrounds. Donn Esmonde doesn't have an agenda, but he does have a brain.

[RJ (not THAT RJ)]

Donn Esmonde is entitled to his opinion and his job, though one has to start from the basic fact that anyone--be he a news columnist or a message board poster--who says, "I hate to be cynical/pessimistic/a wet blanket/a dour douchenozzle" is lying. They love it and think they are superior for being that way. Every. Single. Time.

 

That said, Esmonde is not wrong to doubt whether the Bills need a new stadium. In any rational world, of course they don't need one. Football in particular and sports in general are the toy department of life, and everything connected to them is a choice, not a necessity. A renovated Ralph can be a wonderful place to watch a game for many years to come.

 

The more complicated question, however, is, if the NFL makes the existence of a new stadium a condition of the team staying in WNY, what are the people of WNY willing/able to do?

 

This is not so easy to answer, but it also requires facing a bitter truth: if the Bills leave WNY, the NFL is never coming back to the region. Ever. We are not Cleveland, the NFL is not making any more deals like that. To pretend otherwise is folly.

[SRQ_BillsFan]

One of the things we all would like a out a new stadium and possibly even with a retrofit of the Ralph is a sparkling 30 year lease. Sure it can be broken, but would be difficult if the region continues to support the team.

 

I am not sure we get that with a retrofit and then will sit in the same place in 10 years possibly with a lesser hand. With any luck in 30+ years Buffalo has turned it around.

Edited June 22, 2014 by SRQ_BillsFan

[bbb]

One of the things we all would like a out a new stadium and possibly even with a retrofit of the Ralph is a sparkling 30 year lease. Sure it can be broken, but would be difficult if the region continues to support the team.

 

I am not sure we get that with a retrofit and then will sit in the same place in 10 years possibly with a lesser hand. With any luck in 30+ years Buffalo has turned it around.

 

This is exactly it. I don't think we need a new stadium, but I would think it would ensure many more years.

[klos63]

Where do you think they would play during a retro-fit? That might, ultimately, be a viable option, but I think a temproray location would be a serious issue. There is no stadium locally (southern ontario, wny, cny) that is close to NFL caliber.

Does anyone know what a 'retrofit' would entail? Can't judge how long it would take if we don't know what needs to be done. Does it need a total makeover??? I have no idea what a retrofit would change - more suites , different location for the suites.....

[Dibs]

.....different location for the suites.....

 

I have a question that I'm sure somebody has the answer to:

 

Q: In the case of a state owned stadium, who gets the profits from the luxury suites?

[BringBackFergy]

Does anyone know what a 'retrofit' would entail? Can't judge how long it would take if we don't know what needs to be done. Does it need a total makeover??? I have no idea what a retrofit would change - more suites , different location for the suites.....

How about tying a cable from one end of the stadium to the other and laying a gigantic blue tarp over the cable?? Tie the sides down to the lights. Create a pulley system to raise the ends of the tarp on sunny days...or install gutters on the ends for rainy days. The whole retrofit would cost about $10,000.

[Hplarrm]

 

 

I have a question that I'm sure somebody has the answer to:

 

Q: In the case of a state owned stadium, who gets the profits from the luxury suites?

 

Under the old CBA where the salary cap was determined from items designated as part of the gross receipts, luxury boxes were not designated so a team owner kept 100% of receipts (as opposed to an item like regular ticket sales where the players got a sliding % of the designated gross depending upon a complex formula.

 

This led folks like the Bills to actually lower capacity at the Ralph in order to build luxury seats whose take they did not share.

 

Rather than fight this point, the NFLPA took solace in that under the new CBA they were actually more like partners with the owners given the salary cap.

 

However, they did remember and when the CBA came up for its regular renegotiation back just after the turn of the millineum, NFLPA ED Gene Upshaw dictated that the new CBA would get rid of designation being based on the total gross receipts. He also pronounced prior to any negotiation the player cut of the salary cap needed to start with a 6.

 

Many owners objected to being dictated to by "mere" players, bot Paul Tagliabue and other sons of Pete Rozelle's egalitarian thinking that an individual owner stood to make far more $ from the TV nets once labor peace was settled. With only Ralph and the Packers voting no the rest of the league decided to bend over and take it given the bucks they were given.

 

A new deal with NYS for a stadium could still include a designated agreement between the Bills and the state on luxury box proceeds but there is no CBA demand of this to my limited knowledge.

 

 

[Dibs]

Under the old CBA where the salary cap was determined from items designated as part of the gross receipts, luxury boxes were not designated so a team owner kept 100% of receipts (as opposed to an item like regular ticket sales where the players got a sliding % of the designated gross depending upon a complex formula.

 

This led folks like the Bills to actually lower capacity at the Ralph in order to build luxury seats whose take they did not share.

 

Rather than fight this point, the NFLPA took solace in that under the new CBA they were actually more like partners with the owners given the salary cap.

 

However, they did remember and when the CBA came up for its regular renegotiation back just after the turn of the millineum, NFLPA ED Gene Upshaw dictated that the new CBA would get rid of designation being based on the total gross receipts. He also pronounced prior to any negotiation the player cut of the salary cap needed to start with a 6.

 

Many owners objected to being dictated to by "mere" players, bot Paul Tagliabue and other sons of Pete Rozelle's egalitarian thinking that an individual owner stood to make far more $ from the TV nets once labor peace was settled. With only Ralph and the Packers voting no the rest of the league decided to bend over and take it given the bucks they were given.

 

A new deal with NYS for a stadium could still include a designated agreement between the Bills and the state on luxury box proceeds but there is no CBA demand of this to my limited knowledge.

 

I'm not too sure how much help that is to my question.

As things stand, the income a team generates from luxury suites is added to the overall monies in regards to determining the salary cap. They are not however used in league wide revenue sharing.

 

I am curious as to how much profit(what percentage) a team might typically take from luxury boxes in stadiums not owned by the team. My thoughts here are that if a new stadium could bring in a massive increase in luxury suite money, it could go a long way towards the recouping of the building costs(over time of course).....either for an NFL owner/team building it, or in this case, the State doing so(if their percentage take is substantial).

Edited June 23, 2014 by Dibs

[eball]

Isn't El Pegual just going to write a check for the new stadium? If he is allowed to own both the Sabres and Bills, that is...

[Kirby Jackson]

 

 

I have a question that I'm sure somebody has the answer to:

 

Q: In the case of a state owned stadium, who gets the profits from the luxury suites?

The team will keep that revenue. There will probably be a couple of suites dedicated to the state to use for entertaining, etc....

 

The suite revenue at RWS is probably in the $7-$8M range. My guess is that they can move that to about $10-$12M with a new stadium. They will have different levels and variations. I don't that that extra $3-$4M will be just from increasing suite prices. They will never reach the $50M of NY or SF but they can generate some more revenue.

[Mr. WEO]

I could destroy his column but I am going to give him a semi-pass; he is ignorant. When he refers to public funds he is assuming the state writes a check and it comes from our pockets. That isn't how it works. If they pass along along an 8% jock tax over 30 years, a bed tax in hotels, an airport tax and a % of concessions within the stadium you have funded an entire stadium with "public funds." You just pass the cost off to those that use it. This does not even go into owner contribution or PSL.

 

 

Visiting NFL players already pay a "jock tax" for income earned while they are in NYS. And obviously NYS NFL players already pay NYS income taxes on their total income. Are you suggesting some new tax on home and away players to help fund the stadium?

 

How much will an increased hotel tax (it's already 5%) in a town like Buffalo realistically raise per year?

 

Raising airport fees is another tax on what will be mostly WNY residents. As I understand it, they are currently capped by the Federal Government. Airport execs want to raise the cap to perform improvements on the actual airport. Doubt they would push for a higher cap to build Pegula a stadium.

 

Looking at the new Vikings stadium, PSLs are projected to generate only 120 million for a stadium that will cost a billion---and all of that goes into Wilf's pocket to defray his contribution. The city/state gets none of that.

 

Raising taxes is how the government makes it "come from our pockets", so I'm not sure how you can claim otherwise. Also, the municipality will essentially write a check in the form of a bond sale...

 

It seems the academic literature is filled with papers documenting the dubious or simply nonexistant benefit of that new, publicly financed stadiums have on local economies. Is the Professor of Sports Management from Canisius prepared to argue otherwise?

Edited June 23, 2014 by Mr. WEO

[zonabb]

Having worked in development, planning, and politics, I have a pretty good grasp on major projects like this form how they are financed, how they are planned and constructed, and how the role of the political system. Although it has been suggest that much of the public funding would be soft money and not a check for $200M, that's probably the scenario everyone wishes would happen. However, that's not how it will actually work because that doesn't provide immediate cash to cover construction costs.A so-called "jock tax" or "bed tax" is future money, meaning the state would go bond out whatever money it dedicates from these new taxes for the stadium and pay it back over probably 20 years. That bond, with interest, would cover costs and in all likelihood the stadium owner would use the principal and the state would pay the interest. But the biggest one that'll you'll see if politicians selling off-site improvements to support the stadium as actual necessary improvements for the community.... for example new sewer and water lines, new storm sewers to alleviate some phantom flooding issue; new road lanes to alleviate traffic... all sold as necessary for the general public but without question supporting a new stadium. And because these will be for general public use, the local govts will bond that out, make these improvements and the taxpayers will pay. The cost of a stadium isn't just the stadium, a huge costs is infrastructure upgrades and the off-site improvements will be govt funded. In fact, the owner will say "that's your infrastructure" and "you need to fix it to make this project work." Think of Abbott Road.... no need for a four lane highway in front of the stadium for 355 days of the year. I'm cure that a great deal of any public support will be soft money and include exemption from endless fees and taxes. But the sheer cost will require some hard money from taxpayers.

 

And as for Dr. O'Rourke, the reason why he's probably never quoted is that his background and expertise in in team management and team finances, not the development and construction of a stadium or how to finance that. Suggesting he should be a reference or expert source really is only an attempt to link him to your degree and thereby create credibility for you. I can't find a single publication from the prof in Google scholar and his faculty page doesn't list any either. Andrew Zimbalist, who is quoted constantly, has endless publications. So minus any publications, in particular highly cited ones (the first paper listed by Zimbalist titled "The Economics of Sports Facilities and Their Communities" was cited in 359 other papers/works. That's being a credible expert. O'Rourke is an administrator first, instructor second, researcher and expert third, it at all.

[Buffalo_Stampede]

His focus is wrong. Most people know a new stadium doesn't make financial sense, although it is possible a stadium closer to the Canadian border would increase Southern Ontario season tickets,

 

The reason the Bills need a new stadium or major renovations is because the NFL wants it. Its either a $700 million new stadium or a $400 million face lift for the Ralph. Either way its going to cost a lot. Why they used $130 million+ to upgrade the Ralph now is actually the biggest question mark.

Edited June 23, 2014 by TheTruthHurts

[Kirby Jackson]

 

 

Visiting NFL players already pay a "jock tax" for income earned while they are in NYS. And obviously NYS NFL players already pay NYS income taxes on their total income. Are you suggesting some new tax on home and away players to help fund the stadium?

 

How much will an increased hotel tax (it's already 5%) in a town like Buffalo realistically raise per year?

 

Raising airport fees is another tax on what will be mostly WNY residents. As I understand it, they are currently capped by the Federal Government. Airport execs want to raise the cap to perform improvements on the actual airport. Doubt they would push for a higher cap to build Pegula a stadium.

 

Looking at the new Vikings stadium, PSLs are projected to generate only 120 million for a stadium that will cost a billion---and all of that goes into Wilf's pocket to defray his contribution. The city/state gets none of that.

 

Raising taxes is how the government makes it "come from our pockets", so I'm not sure how you can claim otherwise. Also, the municipality will essentially write a check in the form of a bond sale...

 

It seems the academic literature is filled with papers documenting the dubious or simply nonexistant benefit of that new, publicly financed stadiums have on local economies. Is the Professor of Sports Management from Canisius prepared to argue otherwise?

I simply suggested Dr. O'Rourke as an expert as someone that has intimate knowledge of how different stadium projects have been funded and the market. If you are more comfortable with someone whose name you have read in journals Bill Sutton at UCF may be a good source to reach out to. He doesn't know the market but is widely viewed as one of the top Sports Business minds.

 

The majority of stadium projects are a combination of public and private funds (which is exactly what I have suggested). I threw out a couple of way that you can pass the public portion along to the people that use it and people from out of town. Cities have done this with rental car taxes, bed taxes, etc... There is precedent for this. Obviously, it will fall some to people of WNY but it will not exclusively fall to WNYers.

 

There are ways to create revenue that are not currently in place. That is (and was my point). It is not necessarily "does this dollar go to fixing a pothole or funding a stadium." That is where I take issue. It is money that is not currently there (and generated from the stadium). So while technically it is raising taxes it is not at the expense of something else. You can raise those funds in a variety of manners while limiting the burden on WNYers that will not use the facility.

 

The private funds will come from the owner and PSLs in all likelihood. The PSLs are doable in WNY. We are not talking about $100,000 license fees. I have thought that $300M can be generated from PSLs (60,000 at an average of $5K paid over 5 years). Obviously, those numbers can be tweaked depending on what is needed.

 

I am not disagreeing that public funding of stadiums has been disastrous in many cases. That is one reason that I believe that it needs to fall on those that will use the stadium, out of towners and ownership.

Edited June 23, 2014 by Kirby Jackson

[Mr. WEO]

I simply suggested Dr. O'Rourke as an expert as someone that has intimate knowledge of how different stadium projects have been funded and the market. If you are more comfortable with someone whose name you have read in journals Bill Sutton at UCF may be a good source to reach out to. He doesn't know the market but is widely viewed as one of the top Sports Business minds.

 

The majority of stadium projects are a combination of public and private funds (which is exactly what I have suggested). I threw out a couple of way that you can pass the public portion along to the people that use it and people from out of town. Cities have done this with rental car taxes, bed taxes, etc... There is precedent for this. Obviously, it will fall some to people of WNY but it will not exclusively fall to WNYers.

 

There are ways to create revenue that are not currently in place. That is (and was my point). It is not necessarily "does this dollar go to fixing a pothole or funding a stadium." That is where I take issue. It is money that is not currently there (and generated from the stadium). So while technically it is raising taxes it is not at the expense of something else. You can raise those funds in a variety of manners while limiting the burden on WNYers that will not use the facility.

 

The private funds will come from the owner and PSLs in all likelihood. The PSLs are doable in WNY. We are not talking about $100,000 license fees. I have thought that $300M can be generated from PSLs (60,000 at an average of $5K paid over 5 years). Obviously, those numbers can be tweaked depending on what is needed.

 

 

Each of the taxes you mentioned already exist, yet you say that they will "create revenue not already in place". This can't be true unless you are increase each of those exiting taxes. The jock tax will never be increased, the an increase in the hotel tax in Buffalo will generate not much money and the airport tax is capped.

 

60,000 people don't purchase season tickets (it's not even close), yet that many will spend 5000 and then the cost of seasons simply because there is a new stadium? I don't see how that is intuitive. In Minneapolis (a more affluent town than Buffalo with an equally devoted fan base), the PSLs will average half of what you project WNY fans will pay. Not sure why.

 

There is no need to cite a single reference for the poor ROI of publicly funded stadiums (I simply googled it)---there are many articles. It's a consensus.

 

In sum, you said you were going to "destroy" that column. I don't see how you have come close to doing that yet. Tossing out a few tax increases, overselling PSLs and dropping the name of a guy who doesn't seem to contribute to the discussion cut it.

[l< j]

There is no need to cite a single reference for the poor ROI of publicly funded stadiums (I simply googled it)---there are many articles. It's a consensus.

 

 

Always keep this in mind. Investing in publicly owned professional sports facilities is about something other than a good return for the taxpayers.

 

No problem, the jock tax is around now. I believe that Tennessee was the state that went away from it but I am not positive. The players obviously don't like it but it is what it is. You are basically paying a state tax to work in that state. If you figure that the cap is $133M (sure to go up over 30 years but let's use that for our conservative baseline). The visiting teams will play 10 games a year in WNY (unless they increase the schedule). If each team pays out 13,300,000 per game and you take 8% of that over 30 year you are generating over $319M. Again, it is dumbed down a little but you get the point. The numbers can certainly be tweaked in whatever way you choose. It's certainly a good starting point though if we are talking about an $800M stadium (which for some reason is the number in my head).

 

 

I did some reading on jock taxes and I don't think they will ever generate that kind of revenue the way they are implemented now. Plus as Mr. WEO pointed out, they are already in place at the state level, so any increase would have to be small to be politically palatable. As implemented by NYS and in other jurisdictions, the tax is prorated based on the amount of the athlete's salary that was earned in that jurisdiction. So you have a tax rate multiplied by a salary, and then multiplied by the percentage of the athlete's work days spent in the jurisdiction. But it is not calculated based only on game days, but the athlete's entire work obligations (practices etc.). So you would never raise 10% of the salary cap from visiting athletes; more like 1%. The formula would look like this: Annual Salary * tax rate % * (days worked in jurisdiction/total days worked)

 

Hotel taxes aren't going to contribute that much, either. I found a couple of things online documenting the hotel industry in the Buffalo region: Erie County had 9100 hotel rooms 2 years ago (http://buffalorising...s-some-numbers/) and booked 2.2 million room nights. Another website shows 15,000 rooms, I think for the region (http://www.cvent.com...777d75e54b.aspx). Not sure how old that data is.

 

So pick a number reflecting recent development. 20,000? Let's be generous and use a 70% vacancy rate. 70% * 365 *20,000 = 5,110,000 room nights to tax. How much additional hotel tax can each room generate? Doubling the current rate--and what are the odds of that happening?--would probably get you in the neighborhood of $20MM annually in my scenario, which is pushing the inputs out as far as I can. The revenues if implemented would certainly be much lower than that.

 

So we are a long, long way from being able to support bond payments on an $800MM stadium project.

 

I am sympathetic to the idea that a stadium should be supported by revenues in the way you outline. I just don't see the dollars there to get us very far and I don't think it can happen without a big chunk of public money. Which brings me back to Mr. WEO's point.

 

kj

Edited June 23, 2014 by l< j

[BillsVet]

The reason the Bills need a new stadium or major renovations is because the NFL wants it. Its either a $700 million new stadium or a $400 million face lift for the Ralph. Either way its going to cost a lot. Why they used $130 million+ to upgrade the Ralph now is actually the biggest question mark.

 

Agree completely. New stadiums are the best way for the NFL to increase revenue, which is not coincidentally an objective of the latest CBA. IIRC, players wanted a greater percentage of revenue during the last cycle of contract negotiations. The league, as a result, promised and needs to get total revenue to I believe 19B by 2020, which obviously provides players with greater revenue.

 

Unfortunately, this cycle of stadium building cannot continue in every market. Of the 31 NFL stadiums, 20 will have been built since 1995 when Minnesota's opens in 2016. Another 4 (GB, CHI, KC, and NO) have undergone extensive renovation. Only Oakland, San Diego, Buffalo, Miami, Atlanta, Jacksonville, and Saint Louis have stadiums built before 1996, so clearly the league has taken a path that almost requires franchises get new homes.

 

There's no doubt that the group-think about a new stadium goes back to expanding revenue.

[Mr. WEO]

Always keep this in mind. Investing in publicly owned professional sports facilities is about something other than a good return for the taxpayers.

 

 

 

Such as....?