knucklehead's rolling roof financing plan

Discussion about new sports facilities in Kansas City
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knucklehead
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knucklehead's rolling roof financing plan

Post by knucklehead »

It may be possible to pull together a plan to finance the rolling roof without a public vote. Jackson County has done the heavy lifting by contributing 425 million, so it would make sense to ask other counties to chip in some money. They should be able to swing 10 to 20 million each out of their existing capital budgets.

An example

Chiefs 40
Royals 10
Naming rights 25
City of KC    25

Jackson Co. 20
Johnson Co. 20
Platte Co.    10
Clay co.      10
State of Mo. 20
Wyco/Levenworth 10
state of Ks          10

total 200

Surely Joco isn't so broke that they can't chip in 20 million of a package that totals almost 800 million (rennovations plus roof). I know they are cheapskates in Joco but could they really be that cheap?
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Re: knucklehead's rolling roof financing plan

Post by kcdcchef »

knucklehead wrote:

Surely Joco isn't so broke that they can't chip in 20 million of a package that totals almost 800 million (rennovations plus roof). I know they are cheapskates in Joco but could they really be that cheap?
it is not that they are cheap. they enjoy getting everything for free, stadiums, teams, pro sports, the arts, tens of thousands of tax paying citzens, businesses, why stop that lovely trend for them????
MU FINISHED THE YEAR RANKED HIGHER IN HOOPS AND FOOTBALL THAN THE KAY U JAYDORKS. UP YOURS KAY U JAYDORK FANS!!!! :D :D :D :D :D
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Re: knucklehead's rolling roof financing plan

Post by KCMax »

Wouldn't you need to raise way more than $200 million to raise enough money to pay off the interest off the bonds needed to front the money?
it is not that they are cheap. they enjoy getting everything for free, stadiums, teams, pro sports, the arts, tens of thousands of tax paying citzens, businesses, why stop that lovely trend for them????
Who doesn't enjoy getting things for free? Our sports owners certainly do.
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Re: knucklehead's rolling roof financing plan

Post by kcdcchef »

KCMax wrote:

Who doesn't enjoy getting things for free? Our sports owners certainly do.
keeping it going, good for you max. umm, no, they are putting in 75m dollars. that is hardly free. you putting 75m into any parts of the city? doubt it.
MU FINISHED THE YEAR RANKED HIGHER IN HOOPS AND FOOTBALL THAN THE KAY U JAYDORKS. UP YOURS KAY U JAYDORK FANS!!!! :D :D :D :D :D
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Re: knucklehead's rolling roof financing plan

Post by knucklehead »

It depends if the counties want to pay cash up front or issue bonds. The naming rights and team shares would presumably be cash up front.

The city of KC might issue some debt to finance their 25 million. That would require interest. However, the present value of the two options (paying upfront in cash or issuing bonds) is the same as long as the interest rate equals the discount rate that you use to calculate the present value, so the two options are economic equivelants.

Quoting a purchase price that includes interest is not usually done in the "real world". That would be like saying a $20,000 car costs $30,000 because you pay interest on the car loan. When you tell people how much your car cost, do you include all the interest you will pay over the life of the loan? or do you just quote the purchase price?  

 
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Re: knucklehead's rolling roof financing plan

Post by lock+load »

knucklehead wrote: It depends if the counties want to pay cash up front or issue bonds. The naming rights and team shares would presumably be cash up front.

The city of KC might issue some debt to finance their 25 million. That would require interest. However, the present value of the two options (paying upfront in cash or issuing bonds) is the same as long as the interest rate equals the discount rate that you use to calculate the present value, so the two options are economic equivelants.

Quoting a purchase price that includes interest is not usually done in the "real world". That would be like saying a $20,000 car costs $30,000 because you pay interest on the car loan. When you tell people how much your car cost, do you include all the interest you will pay over the life of the loan? or do you just quote the purchase price?  
When you go to get a loan for the car, they look at what you can afford to spend each month, and that includes interest.  You may only quote the purchase price, but it isn't the only factor considered when you go to seal the deal.
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Re: knucklehead's rolling roof financing plan

Post by KCMax »

I think naming rights are typically spread out over the length of the contract, not upfront. This is why Houston had to change their field from Enron Field to Minute Maid Park.
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Re: knucklehead's rolling roof financing plan

Post by knucklehead »

In the world of finance you can easily convert a future cash stream into an immediate cash payment. The key variable is the credit quality of the party obligated to make the future payments.

For example, the lessor of a facility can convert the future rent payments into immediate cash by entering into what is referred to as a "sale/leaseback" transaction. If the purchaser of the naming rights is a major corporation with good credit ratings, and the contract obligates the purchaser to make a steady stream of cash payments over 25 years, the payments can easily be converted into an up front lump sum payment.
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Re: knucklehead's rolling roof financing plan

Post by Highlander »

knucklehead wrote: It may be possible to pull together a plan to finance the rolling roof without a public vote. Jackson County has done the heavy lifting by contributing 425 million, so it would make sense to ask other counties to chip in some money. They should be able to swing 10 to 20 million each out of their existing capital budgets.

An example

Chiefs 40
Royals 10
Naming rights 25
City of KC     25

Jackson Co. 20
Johnson Co. 20
Platte Co.    10
Clay co.      10
State of Mo. 20
Wyco/Levenworth 10
state of Ks          10

total 200

Surely Joco isn't so broke that they can't chip in 20 million of a package that totals almost 800 million (rennovations plus roof). I know they are cheapskates in Joco but could they really be that cheap?
The problem with this idea is that with a surcharge on tickets for people outside of Jackson County (as I understand it), you cannot go back to the rest of the metro now as ask them to pay for the rolling roof.  At least not without dropping the surcharge which won't happen as that would piss off Jackson County voters. 
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Re: knucklehead's rolling roof financing plan

Post by shinatoo »

kcdcchef wrote: keeping it going, good for you max. umm, no, they are putting in 75m dollars. that is hardly free. you putting 75m into any parts of the city? doubt it.
None of us are putting in 50 mil like Lamar, of course none of us own a football team that make 30-40 mil in profit a year. A profit that will go up with the renovations, probably over that 50 mil. Plus a team value that went up more than 50 mil (most likely) as soon as that vote was validated.
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Re: knucklehead's rolling roof financing plan

Post by WSPanic »

I think Knucklehead's would look awesome with a rolling roof. The East Bottoms could use the attraction.

I vote yes.
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Re: knucklehead's rolling roof financing plan

Post by Beermo »

Apr 6, 12:58 PM (ET)

By SARA KUGLER

NEW YORK (AP) - New York Mets officials stirred up the past on Thursday when they unveiled a stadium design reminiscent of Ebbets Field, the storied home of the Brooklyn Dodgers.

One day after the City Council approved several key aspects of an $800 million stadium for the Yankees, Gov. George Pataki, Mayor Michael Bloomberg and Mets owner Fred Wilpon announced plans at Shea Stadium for a new Mets home to be built in the parking lot of the existing ballpark.

Wilpon, a Brooklyn native, has long desired a new home for his team that evokes memories of the glory days of the Dodgers, who moved to Los Angeles in 1958. Eight years ago, Wilpon unveiled a design for an Ebbets Field-type ballpark for the Mets, but it wasn't until last summer that city officials and the team agreed on a plan to replace Shea Stadium.

"This is a historic and rather emotional occasion," Wilpon said as he recalled visiting Ebbets Field with his father as a young boy. He said predicted the new facility would be a "world class ballpark that, through its unique design, links the past and the future."

Although the planned stadium still requires regulatory approval, Mets officials hope to put their team on a new field by 2009 - the same year the Yankees expect to be playing in a new home in the Bronx.

The new ballpark in Queens will have a capacity of 45,000, down from the current 57,333. The seats will be a little wider and provide more leg room. Also, there will be more luxury suites, rest rooms and restaurants.

The Mets are paying $550 million for the stadium and the city is expected to kick in $90 million in capital funds, officials said. The state will provide $75 million for infrastructure improvements around the stadium.

Proposed Mets Ballpark

Mets ballpark resembles old Ebbets Field
Flushing, New York

Tenant: New York Mets (NL)
Opening: April 2009
Status: Groundbreaking expected in summer of 2006
Capacity: 45,000
Style: Open air
Surface: Grass

Architect: HOK Sport (Kansas City)
Construction: Hunt-Bovis (joint venture of Hunt Construction Group and Bovis Lend Lease)
Owner: New York Mets
Cost: $600 million ($444.4 million for the stadium, and the remainder for infrastructure)
Public financing: $89.7 million in capital funds from the city and $74.7 million in rent credits from the state
Private financing: Approximatley $440 million from the team, although the Mets have said they expect to spend close to $550 million


New Yankee Stadium

Tenant: New York Yankees (AL)
Opening: April 2009
Status: Announce on June 15, 2005
Capacity: 51,800
Style: Open air
Surface: Grass

Architect: HOK Sport (Kansas City)
Construction: Undetermined
Owner: New York Yankees
Cost: $1.02 billion
Public financing: $220 million from New York City for parking facilities ($75 million), parkland along the waterfront ($135 million) and other work related to the stadium
Private financing: $800 million from the Yankees

By JANET FRANKSTON

NEWARK, N.J. (AP) - The New York Giants and Jets moved a step closer to their new home in the Meadowlands.

Officials from New Jersey, the Giants and the Jets said Friday they've made several changes to an agreement signed last fall that will create a new, $1 billion football stadium in East Rutherford.

Under the updated stadium agreement, the state would not be required to pay for $30 million of infrastructure costs around the stadium, said Gary Rose, chief of the governor's office of economic growth.

The stadium is expected to open for the 2010 season and will seat about 81,000.

The new stadium agreement comes after Gov. Jon S. Corzine earlier this month questioned the financial terms of the original deal, brokered by his predecessor, former Gov. Richard J. Codey.

The teams would also be allowed to collect money for naming rights to the stadium and the complex as a whole, with the exception of the Continental Airlines Arena and a new entertainment and retail development that is being built there.

The state also would drop its pursuit of a retractable dome for the new arena, Rose said. Team owners had said they would kill the earlier agreement if the state forced them to pay for a roof.

"Governor Codey made a tremendous effort to keep the Giants and Jets in New Jersey and today's announcement confirms the partnership that has been fostered between New Jersey and the teams," Corzine said in a statement. "The stadium that will be built will be a world-class facility that will set a new standard for football venues."

The owners of the teams said in a joint statement that they are pleased with the updated agreement.

"We are very grateful to the governor for recognizing the importance of this project," said Woody Johnson, chairman and chief executive officer of the Jets. "We are looking forward to moving ahead and beginning work on the new stadium as planned."

In September, the Giants and Jets agreed to jointly finance the new stadium at the Meadowlands Sports Complex.

While the Giants will build their own training facility on a site within the Meadowlands, the Jets will move their headquarters and practice facility to Florham Park from Hempstead, N.Y., in the summer of 2007.
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Re: knucklehead's rolling roof financing plan

Post by shinatoo »

Remember, before all of the people that are down on the owners share pile on (and I know I'm one of those). Both of these teams pay heavily into the luxury tax. Every penny they put into a new stadium gets deducted from their share of the luxury tax. So there is a big financial plus for their contributions. It's not our of the goodness of their hearts.
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Re: knucklehead's rolling roof financing plan

Post by aknowledgeableperson »

And, of course, they can get enough from their local TV and radio rights to pay for these stadiums.  The Royals and Chiefs get a fraction of what the NY teams get.
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Re: knucklehead's rolling roof financing plan

Post by KCMax »

I've also read that the tax credits they are receiving are equal to the private contribution they are making to the stadiums - so in essence they are publicly financed stadia.

Oh but there are a bunch of stadiums that were completely publicly financed, so this isn't the worst deal ever. New Yorkers should be proud!
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Re: knucklehead's rolling roof financing plan

Post by shinatoo »

KCMax wrote: I've also read that the tax credits they are receiving are equal to the private contribution they are making to the stadiums - so in essence they are publicly financed stadia.

Oh but there are a bunch of stadiums that were completely publicly financed, so this isn't the worst deal ever. New Yorkers should be proud!
The tax credits they are speaking of aren't government taxt credits, they are for the MLB luxury tax that goes to revenue sharing. Basicaly its a way for the yanks to get even more advantages over the Royals.
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Re: knucklehead's rolling roof financing plan

Post by KCMax »

I get that. I'm saying they ALSO get tax credits from the gubmint. Pretty sweet deal.

And the deductions for MLB are for revenue sharing, not the luxury tax. I'm not even sure the Mets are even paying the luxury tax anymore.
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Re: knucklehead's rolling roof financing plan

Post by shinatoo »

KCMax wrote: I get that. I'm saying they ALSO get tax credits from the gubmint. Pretty sweet deal.

And the deductions for MLB are for revenue sharing, not the luxury tax. I'm not even sure the Mets are even paying the luxury tax anymore.
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