Ralph Wilson "Decision 2010"

[JinWPB]

I'm wondering why Ralph has not sold the team this year. Even if he took a lot less than the team is worth, his return would be better. Next year he gets hammered by the "end of world, wrath of god" higher capital gains taxes returning.

Also the "rob from the dead" tax returns.

 

His only option I see is to depart before the end of the year. How is the old geezer anyway?

 

Before the avalanche of "but then ther team will be moved to ________".

 

Buffalo Bills sell out most every game every year, why would a new owner pass on a fan bass like this for something that could end up being like Jacksonville.

 

Buffalo has long been considered a depressed area of slumping economic development, with limited potential. Now it appears the rest of the country has caught up. Heh, western N.Y. doesn't look so bad afterall.

[Thoner7]

I'm wondering why Ralph has not sold the team this year. Even if he took a lot less than the team is worth, his return would be better. Next year he gets hammered by the "end of world, wrath of god" higher capital gains taxes returning.

Also the "rob from the dead" tax returns.

 

His only option I see is to depart before the end of the year. How is the old geezer anyway?

 

Before the avalanche of "but then ther team will be moved to ________".

 

Buffalo Bills sell out most every game every year, why would a new owner pass on a fan bass like this for something that could end up being like Jacksonville.

 

Buffalo has long been considered a depressed area of slumping economic development, with limited potential. Now it appears the rest of the country has caught up. Heh, western N.Y. doesn't look so bad afterall.

 

Maybe someone smarter than I on the subject can answer this.....

 

Why doesnt Ralph just sell the team to his children for $1. Then, whenever he does pass, he wont pay any taxes because he wont be the owner of the team. This is no different than a child buying an elderly parents home for $1 then allowing the parent to live there until they pass. Why is this not an option?

[nucci]

I'm wondering why Ralph has not sold the team this year. Even if he took a lot less than the team is worth, his return would be better. Next year he gets hammered by the "end of world, wrath of god" higher capital gains taxes returning.

Also the "rob from the dead" tax returns.

 

His only option I see is to depart before the end of the year. How is the old geezer anyway?

 

Before the avalanche of "but then ther team will be moved to ________".

 

Buffalo Bills sell out most every game every year, why would a new owner pass on a fan bass like this for something that could end up being like Jacksonville.

 

Buffalo has long been considered a depressed area of slumping economic development, with limited potential. Now it appears the rest of the country has caught up. Heh, western N.Y. doesn't look so bad afterall.

He has owned the team this long. Why would he sell now? He has stated he still enjoys football and at his age there is not much left for him to do.

Ticket sales are not the only source of revenue. The bigger money is in luxury suites where the Bills can not come close to some of the bigger markets. The age and condition of the stadium will be an issue for the new owner in the next 5-10 years also.

What I would like to know is what happens between when Ralph does die and the team is sold? Does the league run it...who make financial decisions...etc?

[vegas55]

Maybe someone smarter than I on the subject can answer this.....

 

Why doesnt Ralph just sell the team to his children for $1. Then, whenever he does pass, he wont pay any taxes because he wont be the owner of the team. This is no different than a child buying an elderly parents home for $1 then allowing the parent to live there until they pass. Why is this not an option?

 

 

The difference between the $1.00 paid and the fair market value of the Bills would be considered a gift to the children - When Ralph dies, that "gift" becomes part of the taxable estate - subject to tax.

 

Also selling Bills does not help - Ralph would get 800 million+ and would have to put that money somewhere - where that would be taxed at time of his death

[K-9]

I'm wondering why Ralph has not sold the team this year. Even if he took a lot less than the team is worth, his return would be better. Next year he gets hammered by the "end of world, wrath of god" higher capital gains taxes returning.

Also the "rob from the dead" tax returns.

 

His only option I see is to depart before the end of the year. How is the old geezer anyway?

 

Before the avalanche of "but then ther team will be moved to ________".

 

Buffalo Bills sell out most every game every year, why would a new owner pass on a fan bass like this for something that could end up being like Jacksonville.

 

Buffalo has long been considered a depressed area of slumping economic development, with limited potential. Now it appears the rest of the country has caught up. Heh, western N.Y. doesn't look so bad afterall.

 

I hear what you're saying but a new owner, unlike RW, is going to be in debt to the tune of $800m so it's conceivable that he/she would want to move to a more lucrative market where PSLs and higher private suite revenues for example would put a much bigger dent in that debt. RW Stadium just can't generate the revenues that other markets can.

 

GO BILLS!!!

[Thoner7]

The difference between the $1.00 paid and the fair market value of the Bills would be considered a gift to the children - When Ralph dies, that "gift" becomes part of the taxable estate - subject to tax.

 

Also selling Bills does not help - Ralph would get 800 million+ and would have to put that money somewhere - where that would be taxed at time of his death

 

Are you sure its considered a gift though? I thought the kids would get taxed at some sales tax rate off of the "market value" - I know when I bought my car and registered it they didnt calculate my tax off of the sale price but rather some vehicle value they calculated. I am pretty sure that avoids the death tax altogether - because if they decide to sell it after he passes, they will get taxed twice. Once for death tax and once again once they sell.

[DC Grid]

Vegas 55 is right that the $1 purchase idea would not fly for the IRS. It would be categorized as a gift because fair value wasn't given as consideration.

 

One thing Ralph could do if he wanted to maximize the money he could pass on to his kids / etc, is to sell the team now, while lower capital gains tax would attach, and move the money off shore to be liquidated at his death. Many jurisdictions do not have an inheritance (death) tax, so as long as Ralphy was cool with have his assets kept and will administered in such a jurisdiction, his heirs / beneficiaries could pick up their whole share tax free.

 

I think the reality is that Ralph knows that even if the fortune gets slashed by 30-50% it's still more than his kids will ever be able to spend, and it still represents an insane windfall given what he paid for the team and how little he had to put in $ wise to create the value he now enjoys. I think this is an old guy who loves running an NFL team (even if it wasn't his first choice of locals) and he knows the second he sells it he's out of the business...and potentially hated if the team packs up and leaves.

[billsfreak]

I'm wondering why Ralph has not sold the team this year. Even if he took a lot less than the team is worth, his return would be better. Next year he gets hammered by the "end of world, wrath of god" higher capital gains taxes returning.

Also the "rob from the dead" tax returns.

 

His only option I see is to depart before the end of the year. How is the old geezer anyway?

 

Before the avalanche of "but then ther team will be moved to ________".

 

Buffalo Bills sell out most every game every year, why would a new owner pass on a fan bass like this for something that could end up being like Jacksonville.

 

Buffalo has long been considered a depressed area of slumping economic development, with limited potential. Now it appears the rest of the country has caught up. Heh, western N.Y. doesn't look so bad afterall.

Is a "Fan Bass" that fish that hangs on the wall and sings when you walk by?

 

Seriously though, the stadium is pretty much the ghetto when it comes to NFL Stadiums, especially since The Vet is gone in Philly. The only time that place isn't a dump is on sunday afternoons because of the energy that the fans bring, game in and game out. Like one other person said, selling the regular seats is only a small portion of the income, the big bucks come from the Luxury Boxes and from Corporate buyers. I am really not looking forward to 3 years from now, whether Ralph is alive or not, whether he has sold the team or not, because when the lease runs out, it will most likely be trouble. At the very least for a new lease to come to fruition, there is going to have to be big bucks put into the stadium, but most likely it will require a new stadium, which I am not sure the economy in WNY can foot that bill. What will happen to the team if Ralph dies, I think they have already said his kids don't want it? Will it be the Washington Nationals of the NFL? Owned by the league? I sure hope not.

[DC Grid]

Is a "Fan Bass" that fish that hangs on the wall and sings when you walk by?

 

Seriously though, the stadium is pretty much the ghetto when it comes to NFL Stadiums, especially since The Vet is gone in Philly. The only time that place isn't a dump is on sunday afternoons because of the energy that the fans bring, game in and game out. Like one other person said, selling the regular seats is only a small portion of the income, the big bucks come from the Luxury Boxes and from Corporate buyers. I am really not looking forward to 3 years from now, whether Ralph is alive or not, whether he has sold the team or not, because when the lease runs out, it will most likely be trouble. At the very least for a new lease to come to fruition, there is going to have to be big bucks put into the stadium, but most likely it will require a new stadium, which I am not sure the economy in WNY can foot that bill. What will happen to the team if Ralph dies, I think they have already said his kids don't want it? Will it be the Washington Nationals of the NFL? Owned by the league? I sure hope not.

 

As an aside, NO stadium in the league is worse than FedEx field.

[Typical TBD Guy]

On a related note, anyone know the latest on the LA stadium? The Chargers situation with SD? The Jags situation? Rams? Vikings?

 

The sooner that LA market gets filled, the better for us Buffalo Bills fans. After LA, the relocation climate looks a lot better. Toronto would still be a danger, but it has serious issues regarding a new stadium, the CFL, and non-hockey sport apathy.

[Mr. WEO]

Maybe someone smarter than I on the subject can answer this.....

 

Why doesnt Ralph just sell the team to his children for $1. Then, whenever he does pass, he wont pay any taxes because he wont be the owner of the team. This is no different than a child buying an elderly parents home for $1 then allowing the parent to live there until they pass. Why is this not an option?

Simple. The NFL/owners would never approve the sale at that price.

 

 

Also, By not selling the team this year, Ralph made another $35 million. His plan to avoid capital gains is simply to never sell the team. He won't care how much tax is due when he's dead.

[billsfreak]

As an aside, NO stadium in the league is worse than FedEx field.

I don't disagree, I went there a couple years ago when the Bills played and the Skins called back to back timeouts. With that stadium though it isn't a structural thing like in Buffalo, but a poor design and in my opinion a Non-NFL atmosphere, seemed more like a social event. Not to mention, the upper deck is as big as three levels in most stadiums, it is a 20 minute walk up the steps, terrible design. There were 5 Bills flags and jerseys for every one Redskin one in the parking lot before the game.

[SouthernMan]

I hear what you're saying but a new owner, unlike RW, is going to be in debt to the tune of $800m so it's conceivable that he/she would want to move to a more lucrative market where PSLs and higher private suite revenues for example would put a much bigger dent in that debt. RW Stadium just can't generate the revenues that other markets can.

 

GO BILLS!!!

 

Every time this comes up, I have to ask, "What "more lucrative market" is still sitting there waiting to be the tapped?

 

If it existed, a team would already be there!

 

L.A. or some other forgotten NFL stronghold might initially sell a bunch of PSLs, private boxes, club seats, etc,. but after the honeymoon is over, are "fans" going to renew? If not, do they threaten to move the team to Buffalo in 2025? Any move would have to have a long range plan for profitability. Today's high-tech stadiums are too expensive to build as temporary venues for only maybe 10-20 year residencies.

 

The economy in California isn't exactly the model that America is looking to these days.

 

The other city that always comes up is Toronto. The real Bills fans based in Canada much prefer coming to the party in Buffalo than anything such as the typical Rogers Center lawn Fete. The Canadian football (CFL) fans don't want the NFL encroaching on their territory. And once those pucks are dropped at center ice in October, nobody will be in the stands other than the handful of season ticket holder (many from you know where!).

 

I think the idea of a multi-use Niagara Falls facility near the Canadian border is the most forward thinking one.

There'd be tour packages to the falls designed around a home game weekend. The high rollers from Canada would buy some of those private boxes. You might even get a lot of the big money folks from the big apple to purchase some. Have charter flights from NY. What the hell?..think big.

 

Anyway, in my mind, the leverage gained from the old threat of "moviing the team" has evaporated. Not only would L.A. not be a good place for the Bills, there are several teams ahead of them in line such as the Jaguars, Rams, etc.

 

I could be wrong, but I don't see the Bills going anywhere for a long time.

[Leonidas]

Maybe someone smarter than I on the subject can answer this.....

 

Why doesnt Ralph just sell the team to his children for $1. Then, whenever he does pass, he wont pay any taxes because he wont be the owner of the team. This is no different than a child buying an elderly parents home for $1 then allowing the parent to live there until they pass. Why is this not an option?

 

The difference between the $1.00 paid and the fair market value of the Bills would be considered a gift to the children - When Ralph dies, that "gift" becomes part of the taxable estate - subject to tax.

 

Also selling Bills does not help - Ralph would get 800 million+ and would have to put that money somewhere - where that would be taxed at time of his death

 

That's not the issue. The issue, if I'm not mistaken, is the lifetime gift tax exemption. This year the exemption is $1M, so Thoner, if you give your children a $500,000 and you file the gift with the IRS, both parties are exempt from paying taxes on it. If you give your children a $900M football franchise, they are exempt from paying taxes on the first $1M, but are responsible for paying taxes on the rest. The issue is different, however, if Ralph dies this year (which I certainly don't want to happen), since this year they repealed the inheritance tax, and as a result, his children would pay nothing in taxes. However, since my understanding is that they do not want to run the franchise, they would sell it and be crushed by federal and state sales taxes as a result.

[bills in va]

As an aside, NO stadium in the league is worse than FedEx field.

How do you figure? I've been there many times and it's by far better than alot of stadiums I've been in. Besides for the burgandy and gold I always get a good seat, plenty to drink and have a good experience. What's wrong with Fedex?

[DC Grid]

How do you figure? I've been there many times and it's by far better than alot of stadiums I've been in. Besides for the burgandy and gold I always get a good seat, plenty to drink and have a good experience. What's wrong with Fedex?

 

FedEx is a total dump. The layout of entrances / exits...getting to seats is a mess. If you pop out to get beers, you have a 50-50 chance of being back in 30 minutes. If you drink a lot and need to hit the pisser you'll find longer lines than any man's restroom should have, because they didn't put in enough fixtures etc. I've sat in $110 seats, the nose bleeds, and a number of places between, and I can say I've never been in a worse NFL stadium. Add to that the Skins traded one of the better downtown stadium locations for a port-o-potty in the middle of nowhere, but I guess location wise it isn't much worse than the Ralph. The Skins built that **** pile overnight to try to get it up before Jack Kent Cooke croaked (failed) and the results show. Snyder would have fixed it up along time ago but he seems intent on chocking every penny out of his current situation until he sucessfully lands a better deal to relocate within DC, MD, or VA.

[JohnC]

Simple. The NFL/owners would never approve the sale at that price.

 

 

Also, By not selling the team this year, Ralph made another $35 million. His plan to avoid capital gains is simply to never sell the team. He won't care how much tax is due when he's dead.

 

Not only is Ralph making a substantial profit every year he hangs on but his estate is increasing in worth each year as the value of the franchise annually goes up.

 

The owner made a decision to hold on to the franchise until he passes. That is what he is doing. I don't intend on being disrespectful but an interesting issue is how is the organization going to be run if he is incapacitated for an extended period of time (such as dementia). I suspect one of his finance people would establish the financial paramaters for the organization and the football people would have to stay within the boundaries of the budget. Probably not much different from how things are presently.

 

I realize this topic is a delicate issue. So I want to make clear I am in no way intending to be disrespectful to the owner.

[K-9]

Every time this comes up, I have to ask, "What "more lucrative market" is still sitting there waiting to be the tapped?

 

If it existed, a team would already be there!

 

L.A. or some other forgotten NFL stronghold might initially sell a bunch of PSLs, private boxes, club seats, etc,. but after the honeymoon is over, are "fans" going to renew? If not, do they threaten to move the team to Buffalo in 2025? Any move would have to have a long range plan for profitability. Today's high-tech stadiums are too expensive to build as temporary venues for only maybe 10-20 year residencies.

 

The economy in California isn't exactly the model that America is looking to these days.

 

The other city that always comes up is Toronto. The real Bills fans based in Canada much prefer coming to the party in Buffalo than anything such as the typical Rogers Center lawn Fete. The Canadian football (CFL) fans don't want the NFL encroaching on their territory. And once those pucks are dropped at center ice in October, nobody will be in the stands other than the handful of season ticket holder (many from you know where!).

 

I think the idea of a multi-use Niagara Falls facility near the Canadian border is the most forward thinking one.

There'd be tour packages to the falls designed around a home game weekend. The high rollers from Canada would buy some of those private boxes. You might even get a lot of the big money folks from the big apple to purchase some. Have charter flights from NY. What the hell?..think big.

 

Anyway, in my mind, the leverage gained from the old threat of "moviing the team" has evaporated. Not only would L.A. not be a good place for the Bills, there are several teams ahead of them in line such as the Jaguars, Rams, etc.

 

I could be wrong, but I don't see the Bills going anywhere for a long time.

 

I agree with everything you say. My main point was that anybody who buys the team is going to be heavily leveraged and higher ticket prices along with a new, better appointed stadium is going to be needed to service that debt. It's conceivable to me that a new owner would want to look elsewhere given the economy in WNY; read: not enough major corporate players to sell premium luxury suites. Nor are the local and state governments in position to build a new palace and give away the concessions.

 

Your point about limited other markets and teams already being better candidates to relocate to them is a good one. But past history suggests that some cities would bend over backwards to lure an NFL team. Cities that don't always come up in the conversation. Like OK City or San Antonio.

 

I hope you're wrong, too, about the Bills not going anywhere for a long time. But it will be a far bigger challenge for a new owner to make a go of it in Buffalo as the economy stands now.

 

GO BILLS!!!

[bigdogtim]

I too wish RW much health and a long life. I find it incrdibly amusing that aanyone would doubt for even a nanosecond that there is not a succession plan in place. RW is a wealthy and successful businessman. He did not get that way by accident. Rather, he got there by careful planning and wise decisions. To think he hasn't done the same to provide for his heirs is absurd. In addition, estate planning is an intensely personal issue and although of concern to we fans, is none of our business. That being said, it is still fun to speculate as to what his plans may be.

[Whites Bay]

Cities that don't always come up in the conversation. Like OK City or San Antonio.

 

I just don't see any way that Jerry Jones rolls over and lets another franchise drop into what he considers to be his secondary markets. I'm not saying this won't happen. I'm saying it won't happen without a fight. And that dude has a lot of money and clout to fight the fight.

 

[i just re-read this before I posted it, and acknowledge the fact that it's turned into a long post. My apologies. Read on if you wish.]

 

That's the part that posters on this board don't face when talking about "untapped" markets. There's a reason that markets are untapped. Screw the Rust Belt. Just look at the "growth" areas of the United States with respect to the NFL:

 

Carolinas are done.

 

Florida's done, and might lose a franchise in Jacksonville.

 

Georgia's done.

 

Arizona is done.

 

California is done (this is obviously debatable, but I welcome the debate, since no team has landed in LA since Moses.) Los Angeles couldn't give a #*%@ about the NFL, the economy is in the #($%, and there's no public-sector OPM to fund a stadium. And San Diego is constantly scrambling to hang onto THEIR existing franchise.

 

Texas is done. San Antonio and Oklahoma City are secondary markets for the Dallas Cowboys' VERY greedy and powerful (within the NFL) owner.

 

Colorado is done.

 

Lousiana is done (and Louisiana was not a growth market even before the oil spill).

 

So...where are you looking to land a multibillion-dollar enterprise?

 

Portland, OR?

 

Little Rock, AR?

 

San Antonio, TX? (Deal with Jerry Jones).

 

Oklahoma City? (Deal with Jerry Jones).

 

Birmingham, AL?

 

As odd as it may seem, the Buffalo Bills may remain in Buffalo simply by dint of the worst economic downturn in modern history. Hell, it might not even be that modern. This one might stretch back to the 1930s. I'm not a rocket surgeon, but this recession seems to "have legs". Things may not get back to normal - "normal" being a situation where an entrepreneur can leverage him/herself to the ends of the planet to borrow a billion dollars on very little capital - for 3-4 years. Seriously. If RW passes in that time frame....oh, hell, I don't know. But looking at it as rationally as I am able, I don't see a whole lot of venues lining up to accomodate the franchise.

 

Are there a lot of billionaires out there? Certainly enough of them. But - with the exception of Mark Cuban - they became billionaires by running the business properly. Perhaps it would make the most sense to keep a franchise - with a VERY SOLID brand loyalty, by the way - in the same market, rather than to move said franchise to (e.g.) Portland and start it all over.

 

I mean, gee, things in Jacksonville and St. Louis have gone SO well.

 

By the way, this is not a tirade directed at K-9. It's pretty much the same argument I trot out everytime this board rolls out the "OMFG, THE BILLS ARE MOVING TO (fill in the blank)" issue. Obviously, it doesn't matter that I trot it out everytime this board rolls out the "OMFG, THE BILLS ARE MOVING TO (fill in the blank)" issue.

 

But, what the hell, it's always easier to panic than to deal with things.

 

"Indian Lake" - The Cowsills