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Donn Esmonde Agenda


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If I understand the premise of the OP, it seems a bit crazy to me. The idea that he is against the stadium because he is anti Buffalo Bills, as opposed to being genuinely concerned with spending public dollars on a stadium just seems... off. Is the suggestion that he's a Dolphin fan? Maybe he's not a football fan at all, but I don't think this somehow disqualifies him from writing about the subject. I think the voices of non-sports fans should be heard as loudly as everyone else's when it comes to public financing for stadiums / arenas.

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Such as....?

 

Since I am not the one advocating for public financing, someone else will have to answer this. I'm just piggybacking on your point that stadiums have a poor ROI for taxpayers.

 

kj

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Here are some numbers that I worked up that maybe illustrate my point better about passing it along to those using the stadium. When I threw out Jock Tax numbers earlier I only factored in game days and not total working days (my bad for being an idiot). With that being said you will get 20 working days (assuming no playoffs) of a possible 180 (estimate) working days on the year from visiting players. That 11.11% of the $133M cap (which will increase) taxed at 8.97% will generate right around $40M over 30 years (conservatively).

 

If you instituted a 10% tax on F&B within the stadium that is another avenue. I do not know the Bills per cap but where I was in the NBA it was $12 a head. If we use that as the number (with 60,000 people) that would generate $21.6M over 30 years. I would think that this tax would be hidden directly in the cost. Instead of $10 for something it would be $11.

 

They can raise the parking by $5 per car in the lots. We have no idea how many lots will be controlled by the Bills in a new stadium but if we use 15,000 cars as an estimate that is another revenue stream. That generates another $22.5M over 30 years.

 

In addition, a $2 per ticket service charge can be instituted. Again, this would be rolled right into the cost of the ticket but would be allocated to the stadium. If you do that it is another $36M over 30 years.

 

That is $120M and a decent start. If you use a more conservative estimate on KJ's hotel tax of $10M per year that gets you another $300M over 30 years. I have no idea on a rental car tax but if it could generate $1M a year that give you another $30M. That is $450M there.

 

These are just some thoughts. I am bullish on the revenue that they can generate from PSL's and I know that WEO and I differ. If we use the Minnesota number that is $120M more. We are now at $570M.

 

The Bills new ownership will obviously want the state to pay for as much of it as possible and vice versa. I personally don't see a retrofit as an option for 2 reasons: 1) With the limited number of work days in WNY I would think that they would have to find somewhere to play for a year. Maybe they can work around this but maybe they can't (I realize that they did in GB). 2) I have mentioned it a few times but the Bills need to rescale the stadium to maximize revenue. I do not think that they will be able to do this even with a retrofit. The best real estate in the stadium will have to be priced more in line with the rest of the league. You cannot have people paying $70 per game at the 40 yard line 30 rows up. Hopefully you can keep those people in a lesser location with increased benefits, access and amenities, You can back fill those prime locations with people that you may or may not currently have that can pay the premium. I cannot see this happening at RWS.

 

The point that I have been trying to make are that there are lots of ways to do this and I apologize if this sounds like rambling.

Edited by Kirby Jackson
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Doubling the existing jock tax is impossible. Visiting players are already paying for ALL work days in NY. Bills players are already paying maximum NYS income tax and and local property taxes if they own. You need to give that up.

 

And again, the PSLs go to the owner. If you want to argue that the "public" portion should come from the ticket buyers in the form of more expensive tickets, I'm all for that. Also, how about ALL food and beverage sales go to the owner of the stadium instead of the team--or at least the split should be proportional to the funding of the stadium. No more "Ralph Wilson keeps-everything-contributes-nothing deals"....

 

You will have to explain your bullish report on the pricing of the PSLs in Buffalo. What are your comps?

 

I get that there are many ways to finace publicly, but many others have done so without using your suggested taxes as the mainstay of funding. Most municipalities just "wrote a check".

Edited by Mr. WEO
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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).

 

It has been used before to do this. You will probably face some pushback from the athletes but I think that the state would like it in this case. If they can target this money to be invested to fund a public stadium instead of a private entity you will probably be fine.

 

I like your ideas. A couple of thoughts. Would the jock tax apply to all games the Bills play? If so, will that hurt our ability to retain FA's. (state income tax is already high in NYS, then adding on another 8%). Thought 2: if the jock tax is the route, it does seem like a good revenue raiser w/o raising taxes on the public, and if the stadium is used year round could potentially be applied to any professional sporting event held there (pre-season NBA game, etc.).

 

Doubling the existing jock tax is impossible. Visiting players are already paying for ALL work days in NY. Bills players are already paying maximum NYS income tax and and local property taxes if they own. You need to give that up.

 

And again, the PSLs go to the owner. If you want to argue that the "public" portion should come from the ticket buyers in the form of more expensive tickets, I'm all for that. Also, how about ALL food and beverage sales go to the owner of the stadium instead of the team--or at least the split should be proportional to the funding of the stadium. No more "Ralph Wilson keeps-everything-contributes-nothing deals"....

 

You will have to explain your bullish report on the pricing of the PSLs in Buffalo. What are your comps?

 

I get that there are many ways to finace publicly, but many others have done so without using your suggested taxes as the mainstay of funding. Most municipalities just "wrote a check".

 

This above is my concern with the jock tax. The fans who use the stadium are really the ones (along with ownership) who should fund it. I have a feeling the new owner will put in $$, and the fans by higher ticket, parking, and concession prices will fun the remainder. I'm just feeling optimistic.

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Doubling the existing jock tax is impossible. Visiting players are already paying for ALL work days in NY. Bills players are already paying maximum NYS income tax and and local property taxes if they own. You need to give that up.

 

And again, the PSLs go to the owner. If you want to argue that the "public" portion should come from the ticket buyers in the form of more expensive tickets, I'm all for that. Also, how about ALL food and beverage sales go to the owner of the stadium instead of the team--or at least the split should be proportional to the funding of the stadium. No more "Ralph Wilson keeps-everything-contributes-nothing deals"....

 

You will have to explain your bullish report on the pricing of the PSLs in Buffalo. What are your comps?

 

I get that there are many ways to finace publicly, but many others have done so without using your suggested taxes as the mainstay of funding. Most municipalities just "wrote a check".

Am I doubling the jock tax? Are you referring to the 4+% city jock tax that NYC, Cleveland and some other cities have? I think that there are 18 cities in total that have that.

 

The PSLs are so all over the map that it is tough to anticipate the revenue. I think that the Bills can sell over 40k (which is what Cincy did). I have said 60k which may be too aggressive but I believe that the Bills will have more PSL holders than current STH. They will extend the payments over 5-10 years on that would be my guess and start as low as about $250. Again, the numbers will be worked to meet what is needed. I used the Vikings number above to calculate but I believe that the Bills can surpass that. The prime inventory that has never been available will give the Bills a chance to generate some pretty big bucks. The 50 yard line 30 rows up will not be people that have had them since the 60's. It will be the companies and individuals that can afford a few hundred a game for a ticket (including a portion of their PSL).

 

The other things parking, ticket fee, concession that I suggested will raise the cost of ownership for people attending. If you split parking it is an extra $25 a season, an extra $40 with ticket charges (based on 2 tickets) and an extra $24 a season in concessions. It is another $90 a season (that you can avoid all of but the ticket few if you choose).

 

I am down with the stadium owner keeping the concession revenue but I doubt a new owner will concede that all. We used to pay rent as a percentage of our concession revenue in New Orleans. Certain subsidies would kick in at certain sales figures. If you want to talk about counter-intuitive we stopped selling tickets for a few weeks and just comped them to meet minimum requirements. In turn, the state cut us a $7M check. If we would have sold every one of those tickets we would have made maybe a million bucks. In addition, it would have triggered certain restrictive clauses in the lease that we wanted to renegotiate but I digress.

 

My whole point has always been that their are options that are a combination of public and private. I was just throwing out some potential revenue streams. There is precedent for this. When someone like Esmonde who has a loud voice in this doesn't paint the picture but rather puts through an agenda, I take issue. He is doing a disservice to the public on an important issue. If that is what he feels it is fine but he shouldn't be advocating for people to sharpen their pitchforks on an issue that they may not understand.

Edited by Kirby Jackson
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My whole point has always been that their are options that are a combination of public and private. I was just throwing out some potential revenue streams. There is precedent for this. When someone like Esmonde who has a loud voice in this doesn't paint the picture but rather puts through an agenda, I take issue. If that is what he feels it is fine but he shouldn't be advocating for people to sharpen their pitchforks on an issue that they may not understand.

 

 

I don't understand the harsh response to Esmonde. He isn't advocating on behalf of a small faction of the population, he is simply an early voice reflecting what a large portion of the region believes in. His view not only might not be a minority view but it miaght a majority view.

 

His basic opinion is that it is not wise from a economic and fairness standpoint to use a large amount of public funds to enhance the business of billionaires. That isn't a radical notion and it isn't simply a parochial notion. It's a prevailing position all over the country.

 

I want a new stadium built somewhere in the city, preferably in the outer harbor area. So I'm not coming to this discussion from an anti-stadium perspective. But until we know who the owner is and how much he/she is willing to contribute to the project then things are on hold. Golisano has made some statements that indicated he doesn't see the need for a brand new facility. The Lt. Governor on WGR stated that the current stadium with an upgrade is more than suitable. What happens if Tannebaum from Toronto wins the bid and makes it clear that he has little interest in contributing to a new stadium on the U.S.side of the border?

 

A new stadium proposal is not only a financial issue it is a political issue. And it should be! Mr. Esmonde asked a lot of questions that made a lot of the advocates nervous. It is up to the advocates to demonstrate to the skeptics that a new stadium project is feasible on a variety of levels. If Esmonde made provoked a lot of questions about the stadium issue then he was properly doing his job.

 

 

 

 

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Am I doubling the jock tax? Are you referring to the 4+% city jock tax that NYC, Cleveland and some other cities have? I think that there are 18 cities in total that have that.

 

The PSLs are so all over the map that it is tough to anticipate the revenue. I think that the Bills can sell over 40k (which is what Cincy did). I have said 60k which may be too aggressive but I believe that the Bills will have more PSL holders than current STH. They will extend the payments over 5-10 years on that would be my guess and start as low as about $250. Again, the numbers will be worked to meet what is needed. I used the Vikings number above to calculate but I believe that the Bills can surpass that. The prime inventory that has never been available will give the Bills a chance to generate some pretty big bucks. The 50 yard line 30 rows up will not be people that have had them since the 60's. It will be the companies and individuals that can afford a few hundred a game for a ticket (including a portion of their PSL).

 

The other things parking, ticket fee, concession that I suggested will raise the cost of ownership for people attending. If you split parking it is an extra $25 a season, an extra $40 with ticket charges (based on 2 tickets) and an extra $24 a season in concessions. It is another $90 a season (that you can avoid all of but the ticket few if you choose).

 

I am down with the stadium owner keeping the concession revenue but I doubt a new owner will concede that all. We used to pay rent as a percentage of our concession revenue in New Orleans. Certain subsidies would kick in at certain sales figures. If you want to talk about counter-intuitive we stopped selling tickets for a few weeks and just comped them to meet minimum requirements. In turn, the state cut us a $7M check. If we would have sold every one of those tickets we would have made maybe a million bucks. In addition, it would have triggered certain restrictive clauses in the lease that we wanted to renegotiate but I digress.

 

My whole point has always been that their are options that are a combination of public and private. I was just throwing out some potential revenue streams. There is precedent for this. When someone like Esmonde who has a loud voice in this doesn't paint the picture but rather puts through an agenda, I take issue. He is doing a disservice to the public on an important issue. If that is what he feels it is fine but he shouldn't be advocating for people to sharpen their pitchforks on an issue that they may not understand.

 

NYC levies its own income tax on all individuals who earn income within its borders. They aren't singling out jocks per se. I believe in most of the other cities, visiting players are paying each home team's state income tax per day they were there.

 

In order to fund a stadium, the owner isn't going to be able to float 60,000 PSLs over 10 years (interest free??) when he needs to pay his share of the new stadium now.

 

The bottom line is that if the majority of NYS state, or even Erie County residents who are non Bills fans are forced to subsidize a stadium for an owner who could easily build it privately, they are being forced to accept a really bad, fiscally irresponsible deal. That is all Esmonde is saying I think. He's hardly wrong. Those who do not disagree with him are not necessarily "misunderstanding" this issue. It's pretty easy to understand the math here---for a taxpayer....

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NYC levies its own income tax on all individuals who earn income within its borders. They aren't singling out jocks per se. I believe in most of the other cities, visiting players are paying each home team's state income tax per day they were there.

 

In order to fund a stadium, the owner isn't going to be able to float 60,000 PSLs over 10 years (interest free??) when he needs to pay his share of the new stadium now.

 

The bottom line is that if the majority of NYS state, or even Erie County residents who are non Bills fans are forced to subsidize a stadium for an owner who could easily build it privately, they are being forced to accept a really bad, fiscally irresponsible deal. That is all Esmonde is saying I think. He's hardly wrong. Those who do not disagree with him are not necessarily "misunderstanding" this issue. It's pretty easy to understand the math here---for a taxpayer....

There are cities that have jock taxes as well. For example in Philadelphia it is 3.07%. It is a beyond a little tacky but the jock tax is an option.

 

I wouldn't think that the PSLs would be interest free. My guess is that people will be incentivized to pay up front or on shorter terms. I would think that they would do it with added value (eg: 2 pregame field passes if you pay in full). Teams LOVE to use soft assets and access to steer behavior.

 

I don't think that anyone wants a bad deal. The column was presented as an either/or when there are thousands of shades of gray. I just wanted to raise some alternative options that are feasible.I am going to bow out of this thread having said my piece for better or worse.

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The bottom line is that if the majority of NYS state, or even Erie County residents who are non Bills fans are forced to subsidize a stadium for an owner who could easily build it privately, they are being forced to accept a really bad, fiscally irresponsible deal. That is all Esmonde is saying I think. He's hardly wrong. Those who do not disagree with him are not necessarily "misunderstanding" this issue. It's pretty easy to understand the math here---for a taxpayer....

 

Is it your position that any taxpayer contribution above $0 is a bad deal? Even compared to (say) income and sales tax derived from the Bills? No doubt a fully public financed stadium would be a swindle. But $0 is a weak number for public funds. Sure the owner is rich but there is a price to be paid for having an NFL team in your area. Is there a non-zero cutoff you find acceptable or are you a flat "No" on public funding of any kind?

 

Can we agree that no public funding = no lock in beyond the current lease?

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Such as....?

 

I start from an understanding that based on the info I see a stadium investment by government would quite likely not provide an ROI which would justify fiscally the investment.

 

All that being said there are advantage not measurable in ROI that might make this something which our local elected officials might wan to advocate. These may be:

 

1. The WNY community is ultimately going to rise and fall together. Though folks do not like to admit it it, ultimately how folks are doing in Buffalo proper, in the first ring suburbs, in the second ring go-go suburbs and in the still surprisingly rural third ring suburbs are really linked together that if the inner city is allowed to become a wasteland it is likely to become in our and our children's lifespans an anchor on the economic development of even well-to-do areas.

 

We quite often salve ourselves by focusing more upon the separations which allow folks who may live within a 20 minute car ride of each other to pretend they are totally separate from each other. Be it, A: increased welfare payments from increasing taxes of the wealthy and middle class to pay for services for the poor who can only afford to live in the central city, B: be it increased costs for central government police and courts in higher crime areas, C: be it the bad rep unemployment or inner city crime gives to a broader metro area which weighs down investment by outsiders in more well-to-do or middle class suburbs, D:, be it the kids of more well to do or middle class suburbs being significant economic users of buying items like drugs in higher crime areas, E. be it kids in our area choosing to leave WNY for careers, jobs and futures in the perceived go-go sunbelt cities to the extent Buffalo seems outmoded and old hat, the future of Buffalo, Cheektowaga, Lackawanna, Amherst, Clarence, Newstead, Eden, etc are really intrinsically linked

 

One of the non-ROI measurable links which I think it is critical to the well-being and presence of the Buffalo Bills is that I think that folks quite often live in the fantasy that they in their first, second, or third ring suburban homes are somehow separate from the inner city core.

 

I see one of the primary values that the Buffalo provides to the residents of WNY is that in a real way it links together people across WNY without regard to their economic status, without regard to whether they are city folk, suburban folk, or rural folk that they share something in common.

 

Sometime though I personally would hate to lose the Bills to some other town, I think it would create a situation where if we have good community leaders we would have the somewhat adult conversation about "if we across WNY do not share the Bills in common then what do we share in common. The answer is actually that we do share our economic fates in common. Unless we all learn to work together we will simply fall apart. However, I am selfish and do not want to lose my Bills. However, beyond my own mercenary personal interest I think their is a positive difficult to measure in ROI benefit that they link WNTers (and growingly Southern Ontarians).

 

One of the failures I think I see among our community leaders is that they have not utilized the cross segments allegiance to the Bills to foster greater co-operation in the battle WNY is waging like or not for more economic development here versus in other parts of the country.

 

2. A second benefit to WNY is that to the extent we get Albany to invest NYS funds in WNY we locals will actually disproportionately benefit getting tax dollars from NYC. Though folks here often hate to admit it, most of the money in NYS comes from most of the people. Most of the people in NYS live in NYC and its suburbs rather than in Buffalo (like 20 million to 1 million). To the extent we can get Albany to pick up the tab WNY gets far more benefit than it pays. Due to the oddities that the Jets and Giants home stadium is in Jersey making the Bills the only NYS team and also the oddity of urban NYC and its suburbs balancing each other politically leaving our little second largest city in the state as the largest collection of voters, WNY can sometime get Albany to spend in WNY disproportionate to our population. While we need to be cognizant that we can only go to the Albany well a few times and major Albany spending on a Sports Authority for a new Ralph Wilson stadium might be better to get Albany to invest in other WNY stuff (UB, Improving the Niagara rivers might be other doable candidates) but I think there may be a fiscally responsible such for WNY to get Albany to pay for economic development which does not give a good ROI from the perspective of taxpayers as a whole, but if most of the development benefit comes to WNY while the bulk of the costs are primarily on NYC taxpayers it benefits us here into WNY taxpayer ROI.

 

3. Advertising- I think that our community leaders are really not exploiting an opportunity the NFL provides us to advertise the "new WNY". Each game broadcast shows wonderful pictures of Niagara Falls as a backdrop on broadcast commercials. I think our community leaders should work hard to diversify these backdrops and promote WNY as a great place to visit. For example, I would have the networks consider running camera shots of the windmills springing up along the lakefront coast. These windmills are pretty unique among NE cities and can be a real promotion to folks that this is a different WNY. Likewise, there also can be some interesting shots the nets can be directed to or given such as Zoar Valley, the Eden Corn Festival, Niagara-on-the-Lake Shaw Festival tourism, etc that would be great advertising to shown in visiting cities and around the country in occaisional prime time games. A new stadium should be a centerpiece in presenting the "new" WNY to the country.

 

4. Building momentum- While the ROI can be measured for hiring construction workers to build a new stadium, or for the additional chicken wings sold at local restaurants near the new stadium, there is a real but more difficult to measure investment momentum that a new stadium could bring to an underutilized area like downtown Buffalo. The increase in activity from the near zero activity of downtown Buffalo to a new vibrancy (even if it is short-term it might make a difference in terms of timing for bringing new development momentum to our underutilized lower investment inner city Buffalo.

 

I agree that the best ROI measurements do not show a good ROI for building a stadium but I think this says as much about the inability of these studies to measure the real world benefits of linking together tangibly a region that really is linked together economically whether they want to admit it or not. I think also the ROI studies I have seen do not do proper measuring of an odd case such as Buffalo where the investment can come from NYC while the benefit mostly goes to WNY.

 

Further, if the new stadium urges/force our community leaders to generate a better marketing strategy for the are this would not be measured in ROI but could produce real benefits for the area.

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There are cities that have jock taxes as well. For example in Philadelphia it is 3.07%. It is a beyond a little tacky but the jock tax is an option.

 

I wouldn't think that the PSLs would be interest free. My guess is that people will be incentivized to pay up front or on shorter terms. I would think that they would do it with added value (eg: 2 pregame field passes if you pay in full). Teams LOVE to use soft assets and access to steer behavior.

 

I don't think that anyone wants a bad deal. The column was presented as an either/or when there are thousands of shades of gray. I just wanted to raise some alternative options that are feasible.I am going to bow out of this thread having said my piece for better or worse.

 

Philadelphia, like NYC, imposes its own income tax on money earned in the city by both residents and non-residents. For non-residents, it's just under 3.5%. They aren't picking on jocks, just charging them the going rate for no-residents.

 

If a PSL isn't paid in full, then it is essentially a loan to the PSL purchaser by the team. Like other teams that offer long term PSL payment plans (e.g.:, the Jets offer 5-15 year plans), there is interest charged. No reason to believe any Bills owner would not charge interest on a long term loan.

 

 

 

 

Is it your position that any taxpayer contribution above $0 is a bad deal? Even compared to (say) income and sales tax derived from the Bills? No doubt a fully public financed stadium would be a swindle. But $0 is a weak number for public funds. Sure the owner is rich but there is a price to be paid for having an NFL team in your area. Is there a non-zero cutoff you find acceptable or are you a flat "No" on public funding of any kind?

 

Can we agree that no public funding = no lock in beyond the current lease?

 

Well, if the Bills generate more tax revenue for the state by making more income with a new stadium....great. But that's not what we're talking about.

 

I would be OK with standard infrastructure improvement (improving roads/exits/traffic flow issues, etc), but it should be well under 100 million--and only if the owner was otherwise fully (privately) funding the stadium. This is how Met life was built, as well as Gillette.

 

There is no "lock in" beyond the current lease of the current stadium. Not sure how that relates to the financing of a new stadium.

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Esmonde makes the case for all the small thinkers in life.

 

it takes someone with VISION to build things.

 

someone like Terry & Kim PEGULA

 

SABRES = First Niagara Center = HARORCENTER = facilities used by college and amateur teams in addition to Pro Sports.

 

BILLS = New Waterfront Stadium & Convention Center = ONE SENECA TOWER = facilities used by business, college, high schools and amateur sports.

Edited by papazoid
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