11Alive/Survey USA Poll Shows Avenue Of Support For New Falcons Stadium

January 18, 2013 12:02 pm

by Charlie · 77 comments

Many of the recent opinion polls asking about “taxpayer support” for a new downtown stadium to replace the Georgia Dome have been overly negative.  A new poll from Atlanta’s WXIA-11Alive News conducted by Survey USA shows a much closer level of support to those opposed, when the wording is changed from “taxpayers” to “hotel motel tax” to demonstrate funding source:

The survey of 500 adult Georgians conducted Wednesday night shows that 47 percent oppose using hotel-motel tax funds to help build a new stadium.  43 percent favor it.  10 percent are undecided.

When asked if they would support the project if it’s “the only way to keep the Atlanta Falcons team playing in downtown Atlanta,” 54% supported it and 37% opposed.  The poll has a margin of error of plus or minus 4 and a half percent.

It’s clear that when the focus of the majority of taxpayers’ support is emphasized to be from City of Atlanta hotel/motel taxes, opposition fades.  That’s probably why the Falcons put in all their press pieces and in a letter to season ticket holders that the hotel motel taxes would generate $300 Million for the stadium “And the Falcons will pick up the rest.”  That, unfortunately, is just provably untrue.

The Falcons and the Georgia World Congress Center authority want an “honest” debate on this subject, and we here are attempting to help with that. It would be helpful if they would alter their communications so that the true and total cost of this project to taxpayers could be part of such an honest discussion.

griftdrift January 18, 2013 at 1:09 pm

Wellllllll. I’ve heard many in the opposition use terms similar to “your tax money” in this discussion when specifically talking about the $300 million coming from the hotel tax . Including House Democrats just this past Tuesday. So it does go both ways.

For followup, I turn the mic over to my fellow liberal Mike Hassinger.

bgsmallz January 18, 2013 at 2:18 pm

Honest discussion. That would be marvelous.

I’ll just repost what I wrote on Buzz’s legislative survey results post on 1/4. I think it is relevant today.

“‘It is time to stop talking about fiscal integrity and begin to practice it. The Chicago Bears play in Soldier’s Field which has been around since the fire. What is so bad about the Georgia Dome?’

Could some of the ‘no’ be from a lack of sufficient education on the matter? I mean, this statement is undeniably 100% false but my assumption is that those ‘against’ the stadium wouldn’t do anything to correct this person’s false belief because it would hurt their position. Kind of the age old question of whether the ends justifies the means (if we win the vote, does it matter if we got support because people didn’t know the truth) and probably a debate as an issue in all walks of life…but I think this illustrates the issue pretty well.

Sorry to preach…and certainly not implying that anyone that has posted on the matter here (including Buzz, Charlie, etc.) cares more about winning than the truth. I’m more concerned with the main media outlet in town that seems content on reporting on an issue with a decided slant based upon which way the wind is blowing versus giving people real information on the matter.”

KudzuDave January 18, 2013 at 5:08 pm

I am happy with the Georgia Dome as it is, but Solider Field is not a good arguement as it has been totally gutted and rebuilt in the past 10 years.

The Last Democrat in Georgia January 18, 2013 at 7:40 pm

Soldier Field was totally gutted and rebuilt at a cost of $700 million to taxpayers. A reconstruction project that has been increasingly despised by that same public who had to pay for it as Soldier Field lost its historic character and is now derisively called “The Spaceship” by Chicagoans unhappy that the renovations haven’t help them to attract big events outside of Bears’ home games.

Despite the being the home to the headquarters of the Big Ten Conference and the largest city with the busiest airport in the middle-third of the continent, big events like the Big Ten Football Championship Game and the Super Bowl have gone to Lucas Oil Stadium in nearby Indianapolis because of that stadium’s retractable roof and distinct retro feel (the stadium was constructed to look like an oversized barn, a building that look might look just as appropriate as an vintage exhibition building at the nearby Indiana State Fairgrounds as it does as an NFL-caliber stadium).

bgsmallz January 18, 2013 at 9:32 pm

Solider Field was not fully funded by taxpayers. The Bears paid for roughly 33% of the costs out of their own and NFL funding sources…. about ~$250M of ~$750M in 2013 dollars. Note that the public/private ratio is flipped in the case of the Falcons and the GWCC.

Facts, people. They are nothing to be scared of no matter if you are for or against.

SallyForth January 18, 2013 at 1:34 pm

According to AJCPolitiFact, some not-so-public facts to ponder:
* In a “term sheet” approved in December outlining the deal, both the State and the Falcons agreed that the GWCCA would buy land on which to build a new stadium.
* Deal earmarked $15 mil from the state budget in 2012 to buy land that could be used for the complex. Land acquisition costs will rise depending on which site planners select.
* In addition, roads and other infrastructure near the stadium will beed hundreds of millions of dollars in upgrades. This could push the stadium’s total cost to $1.2 billion, pushing the cost to the public upward of $500 million.
* The stadium would receive millions of dollars in tax breaks from the state through economic development programs for projects of “regional significance.”
* Money from the GaDOT for local road maintenance would be available, and the project may be eligible for additional federal funds too.

Yes, a large portion of the public’s contribution would come local hotel/motel taxes, which are mostly paid by “outsiders.” But the state will buy land for the stadium, chip in hundreds of millions in infrastructure costs, and provide substantial tax breaks. The total share for taxpayers could easily exceed the $300 million being bandied about.

But most importantly to my mind is the fact that Blank and his Falcons’ corporation will get total management of and income from the new stadium – concessions, parking, etc. Not just for the Falcons’ football games, but for every event held at the stadium. The State would retain ownership and its accompanying legal liabilities, but all the revenue from the stadium would go to Arthur Blank. That dog won’t hunt. That is the deal breaker for me.

atlanta_advocate January 18, 2013 at 1:47 pm

See below. The AJC reported this week that if this deal falls through, Blank will build a Falcons-only facility in the suburbs. At that point, to be frank, the best thing to do would be to demolish the Georgia Dome and not replace it with anything, and to see the region’s convention/large events business go splat. If that is what you want, fine. Because that is what would happen.

bgsmallz January 18, 2013 at 2:35 pm

@Sally Forth

“The State would retain ownership and its accompanying legal liabilities, but all the revenue from the stadium would go to Arthur Blank.”

From the term sheet…
“StadCo will pay GWCCA the StadCo Annual License Payment (“ALP”) in the
amount of $2,500,000 annually, escalated by 2% annually for the term of the
StadCo License (including any renewal term).”

So the Falcons pay $700,000,000+ in financing the stadium and on top of that will pay $2.5M per year escalating by 2% annually for the term of the lease and somehow that means that Arthur Blank keeps ‘all the revenue.’

I have a suggestion…as long as we are counting phantom sales taxes as expenses, maybe we could also count the actual $70 Million in lease payments beyond the end of the current lease the state will be receiving, too. Or is that being too honest?

bgsmallz January 18, 2013 at 2:51 pm

By the way, it also points out that insuring the building is the duty of the Falcons and that the Falcons have to reimburse the GWCC for any coverage it has to purchase and that for non Falcon events, the GWCC or promoter will have the ability to retain revenues from the sale of admissions, merchandise, etc. But whatever…those are ‘not so public’ facts, I guess.

OR

They are very much public facts.

http://www.gwcc.com/about/stadium/reports/gwcca_falcons_term_sheet%20-%20execution%20copy.pdf

There is the term sheet. I suggest reading it for yourself instead of just taking the info being spoonfed by the AJC.

Bob Loblaw January 18, 2013 at 3:33 pm

Boom!

IndyInjun January 18, 2013 at 4:03 pm

“the GWCC or promoter will have the ability to retain revenues from the sale of admissions, merchandise, etc.”

How exactly will there be ANY profits from these sales when the Falcons have sole discretion over pricing and seats? This deal also gives the Falcons the right to apply their own overhead to such events, so can’t they eat up all revenues with their cost transfers?

bgsmallz January 18, 2013 at 4:25 pm

“… when the Falcons have sole discretion over pricing and seats?”- I missed where the term sheet says that the Falcons will have sole discretion over pricing and seats for GWCC events. The Falcons are solely responsible for all overhead. Are you really arguing that they should somehow be required to pay for the overhead and not be able to cover those costs through revenues received in the renting of the building?

IndyInjun January 18, 2013 at 4:42 pm

No, that would be absurd.

The previous agreements didn’t allow GWCC PROFIT to be backcharged to the Falcons. Why is there no similar prohibition from Falcons to GWCC in this deal? Can they charge Blank’s salary? How are these ‘overhead’ costs going to be defined?

We are talking $tens of millions in undefined, undisclosed cost shifts.

The Devil is in the details and he is frolicking invisible in this one.

bgsmallz January 18, 2013 at 9:34 pm

Seriously? You’re out of your element, Donny.

Read the term sheet.

IndyInjun January 18, 2013 at 9:58 pm

No, you are out of yours.

Has the GWCCA submitted pro forma financials showing their losses after this deal goes into effect?

If they haven’t you, just made $10′s of millions in annual profit go POOF. You sent all of the revenues bye-bye (or let me clarify, the remaining profits to GWCCA are unspecified with respect to parking, food/beverage, advertising,seating, and just about everything else. )

The question I have for GWCC is this: “How many lay-offs and salary cuts are you going to take since the Falcons are managing and operating a stadium and you aren’t any more?”

SallyForth January 18, 2013 at 7:12 pm

Hey, bg, sorry work got in the way of my P/P time this afternoon and I’m just now responding to you. But from the looks of this thread, I sure did crank up some open discussion on this thing. I appreciate reading all the different thoughts put forth; they give me more food for thought.

Re Blank’s company controlling/managing and getting 100% of the revenue from all future stadium events, plus income from naming rights (how does Home Depot Dome sound to you?), etc. of the totality, the magnitude of those zillions of dollars for decades to come make $2.5M per year look like peanuts. And just wait until Arthur slaps those seat licensing fees on Falcons’ fans, makes everyone pay what has been tossed around as several thousand dollars each, just for the right to even buy season tickets. His company will net untold millions from that alone.

Never mind that when you look around the GA Dome, you can see that the overwhelming number of those 70,000+ fans are regular working class folks who probably won’t be able to afford a licensing fee on top of ticket prices. Does that point toward a future turnout by only wealthy folks and corporations? How will regular taxpayers who are expected to subsidize this venture feel about being frozen out of the new stadium? Hmmm……

Alls I’m sayin’ is that the State needs to maintain 100% control over all the various revenue streams.
That and GO FALCONS, KICK MAJOR 49′er BUTT!!

IndyInjun January 18, 2013 at 8:36 pm

The state ceded control over much of the revenue stream with the Amendments to the 1990 Agreement.

Is GWCC subject to open records requests?

bgsmallz January 18, 2013 at 9:41 pm

-Sally

No worries. But when you use the word ‘all’ without qualifying it, you are wrong. And frankly, he’s paying ~70% of the cost to build the thing and there are a lot of continuing responsibilities to make improvements, pay for stuff, etc.built in there. If he isn’t getting significant control over most of the revenue streams, he’s an idiot.

How in the name of logic and reason should the state control 100% of the revenues of a building that is being built through roughly 70% private funding? Are you a communist? Only kidding….sort of.

SallyForth January 19, 2013 at 12:45 pm

bg, nope, I’m not a communist – just a regular old Georgia conservative, and that definitely means fiscally. And Blank is definitely no idiot; he is a crafty businessman who has amassed great wealth and, in addition to the rest of his empire, owns his very own professional football team. According to Forbes, “The average National Football League team is now worth $1.04 billion.” And that’s just the market price for an NFL team, does not include all the other tangential lucrative income from branded products, endorsements, etc.

Blank didn’t gain his wealth by making poor investments. Anybody can figure out that his $700,000 up-front investment will reap many times that amount over what seems to be about a 25 year life on a stadium these days. The taxpayers do not stand to benefit financially, yet will be expected to pay off any and all bonds floated for the project by the State under our good bond rating.

I’ve seen no numbers on what the additional costs of interest and debt servicing will be, but anybody who has ever bought a house knows that those will be additional big dollar amounts. I don’t know what Atlanta’s hotel/motel tax actually takes in, but if it is not adequate in coming years, the State will have to stand behind the bonds and all accompanying charges. Aka, taxpayers pay. When I say the State should control 100% of the revenue streams generated by the building, that means that we Georgia taxpayers have protection. Of course the State should pass through a pro rata portion of the revenue to Blank’s corporation – just not the whole pot. Taxpayers, aka the State of Georgia, should have some assurance that this will be an income producer for our State coffers and hopefully hold down individual taxes the next 25 years or so.

In the name of logic and reason, why should the we, the people, buy property, float bonds, build an edifice and all the accompanying infrastructure improvements required, and turn over total control and 100% of revenue streams to a crafty businessman? The threats of building a stadium out in the boonies somewhere is a transparent negotiating tool, and even Blank knows that would lose the fan base, cost him personally for all the roads, parking lots, etc. – end up a losing proposition for his corporation and his pocketbook. Never forget he is not in this to lose money, and our State officials should not be either.

I like Arthur Blank and I love the Falcons, but a new stadium is not emotion – it is a humongous business deal. It should be a win-win proposition. Our State government officials are the only people we have for protecting our financial interests in the deal. That’s what we elect them for.

bgsmallz January 21, 2013 at 8:57 am

“In the name of logic and reason, why should the we, the people, buy property, float bonds, build an edifice and all the accompanying infrastructure improvements required, and turn over total control and 100% of revenue streams to a crafty businessman?”

Short answer- We are not turning over total control or 100% of the revenue stream. You either haven’t read or don’t understand the term sheet. Please, for the sake of honest public discussion, read the term sheet and learn what it actually says.

IndyInjun January 21, 2013 at 11:30 am

Per the TERM SHEET – “StadCo/Falcons will be responsible for all food and beverage concessions,sponsorship rights and advertising at the NSP. …. Except as otherwise provided in this Term Sheet or the MOU, StadCo will have the rights to all revenues generated from such activities and otherwise from the NSP(including premium seating as described below) and will pay all related costs.”

Now, granted there are mentions of legacy events hosted by GWCC, but there are no assurances about revenues, while the Falcons get to decide how much costs and overhead to allocate to said events.

In the absence of specificity with respect to the legacy events, the language giving all revenues to the Falcons would prevail.

BTW, the food and beverages contribute about $7,000,000 year, with the net ‘contribution’ of the Dome being about $14 million a year. What happens to GWCC finances when this shifts to the Falcons? Shouldn’t the GWCC cut its salaries and overhead commensurate with the shift to the Falcons?

The public is being snookered.

IndyInjun January 18, 2013 at 2:39 pm

Sounds like AJCPolitiFact got down to the fact that this is a multi-$billion cost transfer to the taxpayer.

Doing analysis of complex contracts is a big part of my experience. 2 nights ago, I sat and read the term sheet, the existing agreements with the Falcons (which showed a huge progression of greater concessions to the Falcons since the original deal in 1990.) I read the funding analysis and I reviewed GWCCA financials.

Mind you these are 100′s of pages and I did not absorb every aspect of those hugely complex documents, but generally my quick analyses have been pretty darned good over the last few decades.

The public is NOT getting the truth and the truth is that this scam hugely benefits Arthur Blank at the expense of the taxpayer….to the tune of $billions.

IndyInjun January 18, 2013 at 2:48 pm

bgsmalz,

That $2.5 million is required to be plowed back into the debt service for the $300 million debt. Once again the payment stream is the Hotel motel tax, which was $16 MM in 2010 and $18 million in 2011, being 39.1% of the overall H?M tax that is dedicated to dome debt service.
Split the difference and the taxes going for this deal are 30 years at $1.7 million or $510,000,000. Once you add the 1% new HM tax, another $1 million or so was expected.

Taxes are leveraged up with bonds for the $300 million. If it is truly $300 million, why not CAP it there? Instead the term sheet commands all manner of techniques to increase the public debt portion of funding.

bgsmallz January 18, 2013 at 2:58 pm

No it isn’t. That is an annual license payment that is separate from the construction costs. Just like the license payment made currently. It goes to help pay for annual operational expenses by the GWCC. (note that it is listed outside of the Financing Section of the stadium).

And your wrong that the Bonds will not be capped at $300M. They will be a set amount upon issuance by the debt limit that will be approved (or not approved) by the state.

And, what you don’t point out, is that ‘tax payer’ expenses are capped with regards to the financing of the construction/demolition on the site to the amount of the bonds. Any overruns are paid by the Falcons.

bgsmallz January 18, 2013 at 3:11 pm

This is what is funny to me. The pro-stadium crowd doesn’t seem to be afraid of facts presented by the opposition.

For example, Charlie rightly points out that there is going to roughly $30M in sales taxes that are going to be waived on the purchase of construction materials. That’s a fact. I can’t argue with that.

However, what I can point out is that if we keep the Dome, we aren’t collecting those taxes either. So, my counter is simply that if you are making a choice between collecting zero sales taxes on no construction or collecting zero sales taxes on construction being privately financed by upwards of $700M, how do you throw that in as a $30M loss for taxpayers? You just can’t. It’s fuzzy math that seemingly can’t be included in any ‘honest’ discussion about real costs without framing as something completely different that the money being spent through the bond financing.

Another thing you can’t do if you want to be ‘honest’? Cite the Barrett analysis on the one hand to support your $30M in sales tax claim while ignoring that the same analysis lists $277M in bonds (not $300M) and also includes $24M in land purchases for a total cost in public financing of $301M including land and bond financing.

But whatever.

Charlie January 18, 2013 at 3:26 pm

There are existing bonds on the Dome that will not be paid off before the new bonds are let. The bond package will be let at $300 Million that GA taxpayers will be guaranteeing.

griftdrift January 18, 2013 at 3:30 pm

The same way the state guarantees bonds for every municipal improvement for just about anything any city does in Georgia?

Bob Loblaw January 18, 2013 at 3:35 pm

Yeah, that way. Terrifying, isn’t it? Especially when you have a codified revenue source to service the debt that expires 27 years from now.

Charlie January 18, 2013 at 3:38 pm

Now that you’ve both changed the subject, I’ll redirect you to where bgsmallz points to where the analysis calls for for $277M in bonds. The GWCC director himself told me that it will be $300M in bonds, because of the amount that will still be owed on the current dome.

griftdrift January 18, 2013 at 3:50 pm

You brought up the bond guarantee. Just pointing out its really no different than what the state already does.

Charlie January 18, 2013 at 3:55 pm

But the land cost isn’t included in the $300M bond guarantee, as bgsmallz implies above. It’s over and above.

bgsmallz January 18, 2013 at 4:09 pm

Charlie-

I’m not saying the $277M is correct or incorrect…although based upon the detailed analysis by the Barrett Group, I assume it is. What I am saying is that you are citing that source for your information on the missed opportunity sales tax while continuing to use the $300M figure. I don’t think it is intentional, but it is inconsistent.

I also was under the impression that the early retirement of the current bonds on the Dome was part of the costs to the Falcons. Frankly, I don’t have a source so I wouldn’t claim to know this for a fact, but they are scheduled to be fully paid by 2017 or 18 according to the Atl Biz Chronicle…right around the time the new stadium is to be opened. I assume they will not be wrapped into the new bonds and will be continued to be paid through Dome revenues until the new stadium is built, right? If they are wrapped in, they would presumably have to do a new lease or amended lease for the Dome.

bgsmallz January 18, 2013 at 4:10 pm

The Barrett report says public financing is $277m in Bond costs and $24M in land costs.

So I’m not saying that the land is included in the bond cost…what I’m saying is that according to source you cite, the total cost of bonds and land is $301M….not $300 M + the cost of land.

IndyInjun January 18, 2013 at 3:22 pm

Ok, the reserve terms refer to $2 million a year that increases 2% and mentions it in conjunction with the Stadco license, but that isn’t the Annual License Payment, which is specifically excluded in a subsequent paragraph. You are correct.

With respect to the cap, there is none at present and it looks to me like the stream of payments and the required debt repayment are more than $300 million. The debt limit set by the legislature will be the cap, then. The term sheet just specifies a funding stream that can support a debt that will vary in total until the bonds are actually underwritten.

I would not assert that any overruns are paid by the Falcons. The scope is too loose and besides the GWCC’s approval authority carries cost risks with it. You cannot control and approve costs without bearing the costs of delay, indecision, etc.

You on the other hand make no mention of how Blank can leverage up the seat rights to all events from GWCC into his own financing package.

My opposition is rooted in the OPERATIONAL terms more than the capital outlays.

We are talking about new taxpayer costs of billions. To say otherwise is a lie.

Lawton Sack (GATA Eagles!) January 18, 2013 at 1:42 pm

I am one of those outsiders, though I live in Georgia. There are a lot of Georgians, like myself, that have to travel 3-5 hours to get to Atlanta. When I go to Atlanta for meetings, events, Capitol visits, vacation, etc. I pay the tax to stay in a hotel. It irks me a little bit to hear it said that this is not being funded by Georgians.

atlanta_advocate January 18, 2013 at 1:43 pm

“When asked if they would support the project if it’s “the only way to keep the Atlanta Falcons team playing in downtown Atlanta,” 54% supported it and 37% opposed.”

That is going to be big, especially since the AJC reported this week that if Blank doesn’t get this deal, he will build a smaller stadium from his own funds that allows him to charge PSLs. Of course, if that happens, the Falcons will be the only tenant, meaning that the Georgia Dome will sit empty. AND there will be no way to replace/upgrade the Georgia Dome when it actually will need it in about 10 years – as everyone agrees – because there will be no one playing there. And the events like the SECCG, Final Four, major conventions etc. will shift from here to JerryWorld. They won’t go to Blank’s stadium because A) Blank will have no incentive – financial, political or otherwise – to open up his stadium to anything but Falcons’ events and B) Cobb/Gwinnett or wherever this stadium would be built won’t have the transportation or other things needed to host major events that require a lot of out of town visitors (how would they get there? where would they stay? etc.)

I was thinking that Blank would sell the team if he doesn’t get his stadium, which would be bad enough. But his building a small, Falcons’ only facility in the suburbs would be even worse. It would be good for Blank, who would be able to keep all the revenue from the Falcons for himself and not have to allow the facility to be used for anything else – which would reduce the costs associated with the facility – but bad for downtown, the GWCC, the state convention business etc.

So Blank is going to get his stadium. The only difference will be if it is on terms that benefit the city, region and state or on terms that benefit only Blank. Lose the Falcons, and the Georgia Dome becomes a white elephant that sits empty the vast majority of the time and for which there is no real prospect for improving or keeping competitive. At that point, I wonder what “the Georgia Dome is fine, we don’t need a new stadium!” crowd is going to say.

Lawton Sack (GATA Eagles!) January 18, 2013 at 1:50 pm

“We don’t need a new stadium” is what we will say. We don’t need to curtail to Arthur Blank’s wishes out of fear. The Georgia Dome is already a part of the talks for the College National Championship game!

Baker January 18, 2013 at 1:59 pm

a^2: The AJC article said that the suburb thing was a possibility, not that that was going to happen. Nice try.

Baker January 18, 2013 at 2:00 pm

I refer you to this post from Nonchalant from a few days ago:

” 1. I doubt he can actually move to the suburbs. To name a likely candidate, Gwinnett County’s commissioners are hardly likely to touch a new stadium, regardless of financing, because of the corruption issues the previous group of commissioners had, and the failure of the Gwinnett Braves stadium. Infrastructure would have to be upgraded, and I’m not sure the county citizens are going to go for that. There is no rapid mass transit, and there isn’t going to be. And having viewed the fan base during the Tampa Bay and Seattle game, as well experienced the real convenience of Marta, it seems to me that Mr. Blank needs a central location, instead of one off in some corner of the metro area. In addition, those of us old enough to remember the original Dome debate (“we must have a dome to get the Super Bowl”) might wonder about this open-air stadium we would now have (and that would cause the same problems for the Chick-fil-A Bowl (for I assume the Dome would be finished as a going concern) as before.)

2. Is Mr. Blank *really* going to forfeit the connection he and the Falcons have to Atlanta, and in a way that makes him the epitome of the publically dispirited citizen? Atlanta certainly seems to be be the upswing, the potential center of the universe, as it were. Would he want to miss that excitement? I think not.

3. 300 million dollars is a lot of money. Someone could perhaps change the world if he had that kind of capital–or even a fraction of a fraction of a fraction. To use it to build an unneeded stadium seems foolish–and a discouragement to start-ups wondering why the state never loved them.”

chamblee54 January 18, 2013 at 2:09 pm

1-”Cobb/Gwinnett or wherever this stadium would be built won’t have the transportation or other things needed to host major events that require a lot of out of town visitors (how would they get there? where would they stay? etc.)”
This would apply to events at an OTP Blank Bowl.
2- What would happen if the NSP gets started, and the Falcons cannot come up with $700+ million? No one seems to be asking this.
http://chamblee54.wordpress.com/2013/01/17/open-letter-about-the-new-stadium-project/

Lawton Sack (GATA Eagles!) January 18, 2013 at 2:11 pm

2 – A very good question. I guess people are assuming that the Falcons’ funding would not be an issue, due to Arthur Blank’s collateral/net worth and backing from the NFL.

Nonchalant January 18, 2013 at 3:17 pm

I think an honest debate needs to include a fundamental reassessment of the character of one Arthur Blank. But pending that, is there any thing else the owner of the Falcons would like to demand? We wouldn’t want him to think he had been mistreated.

Baker January 18, 2013 at 3:50 pm

I don’t think a fundamental reassessment is necessarily needed, but I do think he needs to take a hit in the court of public opinion if this thing goes through. He was skating with not a peep from most media for a long time and it was shameful. Thanks to Charlie, Wingfield, the folks at Common Cause, and a few other places people started paying attention to this. The broader Atl media completely dropped the ball on the leadup to this in 2010 and should be embarrassed.

IndyInjun January 18, 2013 at 4:13 pm

“Per Citi Presentation June 11, 2012. Shown net of Series 2011 retirement, DSRF
deposit, underwriter’s discount, and cost of issuance.”

If the existing bonds are the Series 2011, you have to add the outstanding debt to the $301 million to the final report numbers on the GWCC site.

Hassinger posted that EVERYTHING was disclosed on the GWCC site, but where is the Citi Presentation of June 11, 2012?There is a disconnect between other analysis and the Barrett Final report of August 2012. I believe that there is a huge undisclosed amount of bonding capacity.

Help me connect the dots. There are challenges we have that they won’ be able to counter.

If the public has the notion that the only taxpayer cost is $300 million, the public has been mislead.

Charlie January 18, 2013 at 4:24 pm

My understanding from talking to the GWCC director and staff is that there are roughly $100M in bonds outstanding now, that are scheduled to be repaid about 2017. (doing this from memory as I’m not near my notes from that meeting).

The bonds will be issued in the amount of $300M, providing that’s where the cap is set by the legislature. This will allow for a refi of whatever balance is left on the existing Dome bonds with the balance going toward construction costs. The bonds will be issued soon, after all approals but before construction starts.

I asked several times but was unable to articulate the question properly or otherwise didn’t quite seem to understand what happens to the revenue generated after the new bonds are let and the games are still played in the existing Dome. Thus I don’t know if the debt is serviced immediately (meaning the Falcons get much less out of this $300M because of existing debt to be paid off) or if the revenues during construction go to construction while debt service is delayed until the new stadium is built.

IndyInjun January 18, 2013 at 4:47 pm

“The bonds will be issued in the amount of $300M, providing that’s where the cap is set by the legislature.”

Well, the Term Sheets calls for maximizing out the public bonded indebtedness based upon the cash flow from the H/M tax and I am saying this is a lot more than $300 million.

If they want to come out and publicly cap it at $300 million to included the debt retirement, then count me as a supporter of the project, IF the operating cost piece is ZERO COST and I do mean ZERO COST to the taxpayer. I am pretty sure they cannot meet those goals.

bgsmallz January 18, 2013 at 5:07 pm

There is a line from the Big Lebowski about a child that wanders into the middle of the movie and wants to know the plot.

Why am I thinking of that right now? hmmmmm….

That’s all for me, folks. Have a great weekend and Go Falcons!

IndyInjun January 18, 2013 at 8:46 pm

Children are gullible and are easily fooled about the plot and that is what stadium supporters are trying to pull here.

Go Falcons! Y’all have nothing to do with this off-field war.

IndyInjun January 18, 2013 at 4:19 pm

By what amount is the legislature going to be asked to raise the bond debt cap? Right now the Term Sheet is designed to maximize the funds into the greatest amount of public debt achievable and there is reason to suspect that that number is stunningly higher.

Once again, if the debt cap is $300 million and the operations provide a mere 5% return to GWCC, with commensurate adjustments on the GWCC side, you can count me as a supporter. I don’ t think this deal comes within $1 billion of that objective.

northside101 January 18, 2013 at 4:34 pm

“So Blank is going to get his stadium” says Atlanta Advocate. Hmm, how much different is that from a criminal saying, “I’m going to get your money either ‘voluntarily” or with some lead in your head?” Basically what the late team owner Rankin Smith did 25 years ago—and of course officials tripped over each other to meet his demand despite a wretched football record with more losing than winning seasons. “Build me a staidum or off we are to Jacksonville.” Some might call that extortion, blackmail (fill in your choice)

bgsmallz January 18, 2013 at 4:39 pm

“How much different is that from a criminal saying, “I’m going to get your money either ‘voluntarily” or with some lead in your head?” ”

How about 100% completely different? When you have $700M to spend on a stadium…you can spend it wherever you want, right? I would think calling negotiating with the city/state in order to spend that same $700M in a location and in a manner that suits the needs or desires of the city/state extortion would be a mis-use of the word extortion.

Charlie January 18, 2013 at 5:57 pm

Well, for those who still care at this hour (I don’t, and I’m heading into my weekend), Lori Geary is leading WSB’s 6pm newscast with new conditions or opposition from Governor Deal. Or something. Regardless, based on the tease and a tweet, it appears the Governor has something new to say about the new stadium and its financing.

mountainpass January 18, 2013 at 6:06 pm

Blank $800 M.
Deal no raisey debt capy.

IndyInjun January 18, 2013 at 8:46 pm

Good for the Governor and I have not been able to write that line much.

Charlie January 18, 2013 at 6:06 pm

She is reporting that the Governor has asked the Falcons to reduce the public contribution from the hotel motel tax to $200M, so legislators don’t have to vote on this. (again. Many are on record of having voted for this project in 2010, and that shouldn’t be forgotten).

bgsmallz January 18, 2013 at 9:54 pm

Charlie-

If you are Blank, would you pay $800M to build a retractable roof stadium downtown or would you take your $700M and build the stadium you want, where you want it?

Regardless, if the legislature doesn’t vote on the increase, I would assume the GWCC could reduce the annual license fee from $2.5M annually to basically $0 and then find the money to cover the red numbers in their annual operating budget from the hotel/motel tax. Legislators would declare victory , Grover’s beard is thrilled, same ‘cost’ to taxpayers, and no responsibility to explain difficult decisions and concepts to the public. So…basically business as usual.

gcp January 18, 2013 at 6:11 pm

Arthur Blank needs to buy the old Doraville GM site. He could have it for 30 to 40 million, maybe less. Its on MARTA and has immediate access to 285. The area is heavily commercial so a stadium would be perfect. He would have to pay to clean the site but if he really wants a stadium, it would be more than adequate.

Dave Bearse January 18, 2013 at 10:01 pm

Doraville, and nearby Chamblee and Dunwoody would oppose a stadium at the GM site, even if Gwinnett hadn’t been taken to the cleaners on the AAA Braves stadium deal. I doubt Cobb is interested in a stadium. A stadium further north would be a decidely inferior location, especially without an outer Perimeter.

Blank’s current operation doesn’t pay property taxes. He’ll have to bargain with the state and local government simply to retain that goody. No other local government and the state is going to gift billionaire Blank a couple hundred million in land and infrastructure. Much if not all of that expense will come out of Blank’s pocket one way or another, at one time or another. (Stadiums don’t provide good jobs, unless part time parking attendents and concession help constitute good jobs. Supporting businesses such as restaurants and lodging can’t make it on 30 events a year either.)

The Dome won’t be torn down until years after a new stadium is built, which will hit Blank’s pocketbook too. Some of the events other than Falcons games likely contribute at the margin in a substantial way to the Dome’s financial success. Some of those other events will simply go away instead of relocating to a boondocks stadium after the Dome is torn down.

Another pocketbook hit will be the higher loan interest rate required of an all-private stadium. I lack the market knowledge to speculate on the interest rate differential, but even a fraction of a percent is big money that doesn’t get to the bottom line when hundreds of millions are being borrowed for decades.

A smaller stadium (except for the number of luxury boxes) in a less central location that isn’t much better for the rank and file attendee experience will command less in license fees granting the right for the rank and file fan to to pay significantly more for tickets.

Lastly, I don’t see the NFL abandoning the Atlanta market (despite that it is being threatened). The Atlanta market is much larger, and larger relative to the nation as a whole, than it was in the late 1980′s. Few would be shaking in their boots if Jax didn’t now have a team, and Blank was threatening to relocate to Jax.

Blanks’ blowing smoke up the arse. It’s something great businessman are ofter good at doing.

gcp January 19, 2013 at 12:09 pm

Blank will take the best deal he can get and of course that best deal will come from the state and city. Blank has never offered a plan to Doraville or any other jurisdiction because he knows that in the end the state and city of Atlanta will give him what he wants so why should he look elsewhere? Stadiums can be built with private funds; Turner Field, for example, was built with private money. With today’s low interest rates, now would be the time for him to borrow. And yes there is other close –in property suitable for a stadium. Cool-Ray Field is a mess because it was a poorly planned, poorly timed deal made by a questionable group of Gwinnett County Commissioners. But in the end the whole thing does not matter because Blank will get his government funded dome.

IndyInjun January 19, 2013 at 12:53 pm

Yes, he will get it. The question is how much of it.

Cap the debt at $300 million, cut the GWCC staff and salaries to compensate for the loss of stadium contribution to overhead and profit, extend the construction cost responsibility to ALL costs, not just “cost overruns” (they are being particularly tricky with that one), and get assurance that the public PAYS NOTHING for operations, maintenance and capital upgrades except the 39.1% of the H/M tax and call that the deal. (This still leaves Atlanta paying $100′s of million in infrastructure costs.)

debbie0040 January 19, 2013 at 10:18 am

The New Orleans Superdome is ten years older than the Georgia Dome and has survived Katrina. they are not asking for a new stadium.

There is also a matter of 30 million dollars the state paid for land the new stadium will be built on. Arthur Blank and company need to purchase that land from the state. It should not be given to them and nor should there be sales tax breaks on construction supplies/equipment.

I am amazed that Mayor Reed wants to give a break to a billionaire in regard to the proceeds from the hotel/motel tax. He should give a break to the citizens of Atlanta and use that money for sewer improvements.

Since I mentioned sales tax breaks, shouldn’t Delta be paying tax on fuel since they are now making a profit? why are we continuing to give them a bailout?

IndyInjun January 19, 2013 at 10:57 am

Parasites attacking us from below and above are hard to kill. Before long the great American middle class will be in the dustbin of history. Sadly, almost none of them give a damn.

bgsmallz January 19, 2013 at 5:50 pm

Debbie-

The Superdome was rebuilt and has been renovated multiple times at a cost of hundreds of millions of dollars since 2005 using mostly taxpayer dollars.

Your complete lack off actual support for your statements is reckless, at best.

It “survived” Katrina…..Unreal.

debbie0040 January 19, 2013 at 7:49 pm

I was wrong about the age. The superdome is 20 years old and yes it survived Katrina and the damage caused by it being used as a shelter . Part of the costs you mentioned was cleaning up and repairing the damage done.

They are not demanding a new stadium.

Again, Mayor Reed has 300 million dollars as this disposal to provide relief to either the tax-payers of fulton county or a billionaire. He has chosen the billionaire.

The land that was purchased by the state should be sold not given and there should be no tax breaks for construction. Put that money into programs that are facing budget cuts-like mental health . Use the money to create programs to provide much needed help for autistic children, not provide help for a billionaire that can afford to build a stadium himself. It is all a matter of priorities…

griftdrift January 19, 2013 at 8:22 pm

Interesting point of view. From Loganville.

Where’s Plan B, Debbie? Or is this part of it?

bgsmallz January 21, 2013 at 9:18 am

Debbie-

The Superdome was built from 1971-1975. The funny thing is that saying it ‘survived’ Katrina is probably more ridiculous than somehow believing that 1975 was 20 years ago.

And knowing that it will fall on deaf ears, feel free to educate yourself about the history of the Superdome immediately prior to and after Katrina. Or don’t.

The long and short of it is that the Saints owner, Tom Benson, had been actively trying to move the team to San Antonio for roughly 4 years and didn’t agree to keep them in NO until (1) he threatened to void his lease on the Superdome (less than a month after Katrina) and (2) the NFL and the Federal/State government stepped in and agreed to basically pay for a brand new Superdome while blocking his move to San Antonio.

Your federal tax dollars went to pay for the Superdome. FEMA contributed over $100M to the renovations and repairs. Using the Superdome as some sort of example of fiscal conservatism in comparison to the current situation is just ignorant.

Jane January 19, 2013 at 10:56 am

Do not trust a poll unless it is done by John Garst.

saltycracker January 19, 2013 at 12:34 pm

facts+half-truths+fiction+leaps of faith=obfuscation

Why do multi-billion dollar businesses – Falcons, GWCC – need general public money outside their vast umbrella of participants ? We’re drawing a Blank here sorting out the greater good.

SallyForth January 19, 2013 at 12:50 pm

*chuckle* Good one, salty.

Nonchalant January 19, 2013 at 5:49 pm

Mr. Blank is, I believe, 70. Obviously, if a new stadium is built, sometime during its lifetime Blank will no longer will be with us. Why should we not expect the next owner to pull the same trick as Arthur is doing now, so that Atlanta continually ends up being forced to build stadiums on a generational basis, based not on need, but on greed?

I say “no”. If the Falcons move out, no state funds should go to road improvements in areas leading to surburban stadiums, if those surburban roads are not already now candidates for improvement dollars. Let the local areas fund their “theft” on their own (and I live in one of the candidate counties). The state has no need to pay for the enhancement of Mr. Blank’s team value, for it and the city of Atlanta have already contributed more than enough to the value of the Falcons via two stadiums over forty years with no equity to show for it, and even less gratitude.

IndyInjun January 19, 2013 at 6:22 pm

I don’t say absolutely “no” for several reasons.

I say no to a $1.2 billion to $1.5 billion giveaway., which this thing is.

Let’s hold it to $500 million with some tough controls and call it a day.

mpierce January 19, 2013 at 8:49 pm

Can you give a breakout of where that $1.2 billion figure comes from?

IndyInjun January 19, 2013 at 9:16 pm

I will give it a shot later….I am still looking for that Citi report dated June to plug the gap in earlier estimates and the final one at the signing of the Term Sheet. I want to know what variables were plugged in. The $277 million from the final Barrett report were net of demolition and said report was from the “Citi” report.

The scope is so loosey-goosey and the wiggle room is so wide in the cost responsibilities, $1.2 billion would be on the low side, hence the $1.5 billion. For example, the term sheet says that Falcons pay for cost overruns, but with undefined project and operational limits to scope, you can bet there will be change orders and change orders to the maximum price increase said maximum price, giving rise to a cost increase but no cost overrun.

Where are the pro forma GWCC financials based upon GWCC no longer having a stadium to manage?

I am also highly concerned about the lack of definition of overhead costs that the Falcons can charge back.

A group took apart another similar project elsewhere in Georgia that was based upon a loose “term sheet.” How that puppy started out versus the way it nearly ended up was shocking.

griftdrift January 19, 2013 at 10:52 pm

What was that?

IndyInjun January 19, 2013 at 11:46 pm

Augusta TEE (Trade, Exhibition, and Event) Center.

elfiii January 21, 2013 at 2:17 pm

@IndyInjun “The public is being snookered.”

Not no more circa yesterday around 5:30pm. The Falcons can choke in an old “Wore Out Stadium” just as good as they can in a new one. Probably better. ;)

IndyInjun January 21, 2013 at 2:50 pm

Yeah, I talked to my state senator yesterday and we agreed that if the birds got to the SB, all opposition would be overwhelmed. It looks like that is out of the way.

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