Zero2Cool
13 years ago

crazy footage! metrodome IS a piece of crap!

"Formo" wrote:



Don't tell that to the state legislature here.. They say it's PERFECTLY FINE for another 25 years.

Fucking douchebags..

"musccy" wrote:

The structure equals the quality of the home team that plays in it.
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Nonstopdrivel
13 years ago

Call it loan, but the coffers in the Minnesota State legislature get replenished and they would probably make money, which could then be spent on tax refunds back to the citizens [in theory].

"DakotaT" wrote:



That's a great start, but why not guarantee the taxpayers a fair interest rate? The reason why these franchises have to resort to the state for funding is that banks and venture capitalists don't consider them good enough credit risks to offer them affordable interest rates. So charge the franchise less than the 10% to 12% the banks are probably demanding but more than the going rate of inflation. Better yet, index the loan to inflation. That way the franchise still comes out ahead financially but the taxpayers are protected against the loss of their investment through inflation creep.

This could be accomplished by skimming off a percentage of the receipts as you mentioned, with the Vikings organization making up any deficit in the event of declining sales.
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Cheesey
13 years ago

buckeye: The Packers play the Patriots next week, not the Giants.

"buckeyepackfan" wrote:



Damn, someone saw that before I had a chance to change it.!!! 😃 😃

My bad.....that's what I get for trying to look ahead!!!

Go Packers!!

"Greg C." wrote:


The Packers made the same mistake with the Lions.
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DakotaT
13 years ago

Call it loan, but the coffers in the Minnesota State legislature get replenished and they would probably make money, which could then be spent on tax refunds back to the citizens [in theory].

"Nonstopdrivel" wrote:



That's a great start, but why not guarantee the taxpayers a fair interest rate? The reason why these franchises have to resort to the state for funding is that banks and venture capitalists don't consider them good enough credit risks to offer them affordable interest rates. So charge the franchise less than the 10% to 12% the banks are probably demanding but more than the going rate of inflation. Better yet, index the loan to inflation. That way the franchise still comes out ahead financially but the taxpayers are protected against the loss of their investment through inflation creep.


This could be accomplished by skimming off a percentage of the receipts as you mentioned, with the Vikings organization making up any deficit in the event of declining sales.

"DakotaT" wrote:



SHHHHHHHHHHHHHHHHHH, we better keep this to ourselves.
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dfosterf
13 years ago

Call it loan, but the coffers in the Minnesota State legislature get replenished and they would probably make money, which could then be spent on tax refunds back to the citizens [in theory].

"Nonstopdrivel" wrote:



That's a great start, but why not guarantee the taxpayers a fair interest rate? The reason why these franchises have to resort to the state for funding is that banks and venture capitalists don't consider them good enough credit risks to offer them affordable interest rates. So charge the franchise less than the 10% to 12% the banks are probably demanding but more than the going rate of inflation. Better yet, index the loan to inflation. That way the franchise still comes out ahead financially but the taxpayers are protected against the loss of their investment through inflation creep.

This could be accomplished by skimming off a percentage of the receipts as you mentioned, with the Vikings organization making up any deficit in the event of declining sales.

"DakotaT" wrote:



You're right, Non. The banks don't consider them a good credit risk. Does everyone know why?

On the surface it would seem to make little sense, as the NFL franchises seem to be money printing factories...

Non just hit on THE biggest reason that the owners are unhappy with the existing collective bargaining agreement.

According to the folks over at Forbes-

The banks and bond rating entities don't like the distribution of revenues.

It is their position that the owners are not anywhere near maximizing their profitability, due to the revenue split with the players, coupled to a lesser degree with the idea that (from a pure economics standpoint) ticket prices that are "too low".
Wade
  • Wade
  • Veteran Member
13 years ago
NFL teams (with one weirdo exception 🙂 ) are not publicly held companies. The reality is that banks make credit decisions based upon information the rest of us don't have. And "entertainment" accounting is in a league of its own.

Add in the fact that the "ownership group" is a small group of rich kids who often have more money than sense, with questionable connections and "business relationships", you're not necessarily talking about blue chip enterprises. And billion dollar TV contracts doesn't change that.

We all look at this (well, maybe not foster, since he's rich 🙂 ), but if you're an investor/lender of mega-millions...you aren't looking for everyday return-on-investment. You'r looking for mega-return-on-investment.

Consider all the money spent on Division I football. I read a story just a few weeks ago -- know how many Division I football programs support themselves without taking money from other university funds? 14.

That's right. 14.

Now, I expect most of the NFL franchises are profitable. But the principle is same: there are a lot of expenses that they have that we never think of -- their medical and insurance budget alone has to be staggering. I wouldn't be at all surprised if after you get some advanced training in untangling funny-money accounting, and somehow get access to NFL team books, you discover that actual percentage rate of return turns out to be really small.

If you are an owner who can deduct everything from random plane flights to Hattiesburg to multiple weekly pressers to every drink you serve (or drink) in your luxury boxes, it's a great life. But if you're a banker looking at all that extra spending on perks and whatnot.....you see a company spending a lot of stuff that is hard to translate into concrete return.

And banker types...they like concrete numbers. They hate soft numbers.

NFL teams are in the entertainment industry. And the entertainment industry is the epitome of soft numbers.
And do not be conformed to this world, but be transformed by the renewing of your mind, that you may prove what is that good and acceptable and perfect will of God.
Romans 12:2 (NKJV)
Nonstopdrivel
13 years ago

that actual percentage rate of return turns out to be really small.

"Wade" wrote:



You're right, as usual. A few months ago I read an article in which it stated that the Cowboys organization netted about $10 million last year. People were pointing at that figure as proof that the owners are raking in the megabucks and should be happy to hand over more cash to the players. They never stopped to think, of course, what a minuscule rate of return on a huge investment that represented. Nor did it occur to them, apparently, that there were players on that roster who were earning more in one year than the entire organization was netting.

When you look at the big picture, it's not at all surprising the bankers and venture capitalists want nothing to do with these franchises. The potential reward isn't worth the risk. That question then becomes, of course, why should the taxpayers be forced to shoulder a risk no sane businessman is willing to touch?
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Pack93z
13 years ago
I would be hard pressed to believe that only 14 programs support themselves.. when most athletic programs are supported by conference money brought in by the BCS conferences and bowl games.

However with the HC and staff wages.. and the filtering of cash by the conferences themselves.. maybe.
"The oranges are dry; the apples are mealy; and the papayas... I don't know what's going on with the papayas!"
Wade
  • Wade
  • Veteran Member
13 years ago
Here's where I got the number from. (the beginning of Gregg Easterbook's column on "Page 2" of ESPN.com last week)

Why are athletic departments so big?
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173
By Gregg Easterbrook
Page 2
Archive

Kurt Snibbe/ESPN.com
Bowl season is nearly upon us, and college football conferences are reshuffling like mad, with bowl invites, television rights and media exposure the motives. College marketers know that in 2008 the University of Texas had $88 million in football revenue while Ohio State had $68 million (Wall Street Journal figures), and football dollars are still going up. The money rush isn't confined to the top, rather it is spread broadly across the higher-education landscape. The University of North Carolina at Charlotte, which plans to start Division I-AA participation in 2013, is asking $2,500 per personal seat license for good seats at its new field, plus a donation of up to several thousand dollars, making the true PSL price more like $5,000. That's for a Division I-AA program that doesn't even exist yet.

Despite the cash-grab in big-college athletics -- Texas, already the leader in football revenue, cut an even better deal for itself this fall by threatening to leave its conference -- nearly all universities lose money on sports. Recently the NCAA reported that only 14 Division I-A programs clear a profit, while no college or university in the United States has an athletic department that is financially self-sustaining. Nobody in Division I -- not Alabama, not Auburn, not Oklahoma, nobody -- has an athletic department that pays its own way.


The median big-university subsidy from general funds to sports is $10 million per school, the NCAA found. Many major college athletic programs claim to be self-sustaining, since this is what everyone wants to hear, but actually are not. For example, the University of Oregon claims its athletic department is self-sustaining. Yet the school's general fund gives the athletic department nearly $1 million per year, Rachel Bachman of The Oregonian reports. Increasingly, college students who don't play sports are charged to support those who do. USA Today reports that in the 2008-09 school year, colleges charged their students $795 million to support athletics. Often this wasn't revealed, with the costs buried in tuition fees that students, and their parents, thought were solely to support academics.

The money-pit aspect of big collegiate sports occurs despite the flow of booster contributions to "athletic foundations" and similar accounts. Booster funds not only fail to make collegiate sports self-sustaining, they may harm the colleges overall -- since many alumni and boosters who might donate to the general endowment or the scholarship campaign of Maryland or Miami or Wisconsin donate instead to the booster organizations. Over the years, billionaire T. Boone Pickens has donated nearly $500 million to Oklahoma State, his alma mater -- but most of the money has gone to athletics, not academics. The donation that UNC-Charlotte requires, in addition to the PSL fee? It goes to the booster fund, not to academics. At many colleges and universities, athletic programs cannibalize donations that might have gone to education.

Big-deal college sports programs need subsidies in part because Division I football and men's basketball coaches are overpaid. There are nearly 100 big-sports college coaches earning at least $2 million annually, most at public universities. More than 200 assistant football coaches in the college ranks earn at least $250,000 annually, with Monte Kiffin of USC, the defensive coordinator, earning $1.5 million plus lavish perks. When Pete Carroll was head coach of USC, he was paid $4 million annually -- and in return, left the school's football program a flaming wreckage. Forbes estimates that Nick Saban is paid $4 million at Alabama.

Some coaches' salaries are covered by booster funds, not by the school itself: but booster funds funnel money that otherwise might have been donated to a school's academic programs. Last year the Knight Commission found that nearly all college presidents, even the ones at sports-powerhouse schools, believe salaries for football and men's basketball coaches are out of control. This is especially telling since high coaches' salaries don't even result in programs that make money, the way high coaches' salaries in the NFL result, at least, in profit.

Beyond too-high coaches' pay and perks there is another, less noticed reason almost all colleges lose money on sports -- featherbedding in the athletic department.

In an era when budget stress is causing classes to be cut and core academic missions to be scaled back, many collegiate athletic departments are the most overstaffed organizations this side of a Monty Python sketch. Because sports is viewed as sacrosanct, the athletic department can get away with having far more people than needed -- then sending the bill to average students and to taxpayers.

Ohio State lists 458 people in its athletic department. Included are the athletic director (who's also a vice president of the university), four people with the title senior associate athletic director, 12 associate athletic directors, an associate vice president, a "senior associate legal counsel for athletics" and plus a nine-person NCAA compliance office. NCAA rules are complex, to be sure, but does Ohio State really needs nine people who do nothing but push NCAA paperwork? The Ohio State NCAA compliance staff is lean and mean compared to the football staff, which includes 13 football coaches, a director of football operations, three associate directors of football operations, a "director of football performance" and three football-only trainers.

How do these numbers compare to academic departments at the school? There are 192 faculty members in Ohio State's English department, with a support staff of about 50. Thus the Ohio State athletic department has roughly twice as many people as the Ohio State English department. Sports receive more staffing than English though nearly all Ohio State students at some juncture take a course through the English department, while few participate in NCAA athletics. And sports receive more staffing than English, though there is a widespread feeling that many Americans are inadequately educated in subjects such as English, while not one single person in the entire United States believes there isn't enough emphasis on sports.

[+] Enlarge
AP Photo/Terry Gilliam
The Ohio State athletic department may be visible from orbit.
Now factor in the size of Ohio State's student body compared to the football roster. All those coaches and mysterious "associate directors of football operations" mean that in football, Ohio State has a 1-to-5 ratio of staff to students: while in English, the staff-to-student ratio is 1-to-280. Divide the latter by the former. In staffing terms, Ohio State treats football as 56 times more important than it does English.

Am I deliberately choosing a college with sports mania but a reputation for weak academics -- the kind of place likely to have skewed priorities? Let's look at the University of California at Berkeley, a college with renowned academics and highly selective admissions policy.

Cal has a 27-person staff for football coaching and administration, overseeing a roster of 110 players. That's a 1-to-4 ratio of staff to students. The school's English department has 71 non-emeritus personnel, plus about 50 support staff, serving a student body of 35,843. That's a 1-to-296 ratio of staff to students. Judged by staff, Cal devotes even more resources to football, versus English, than does Ohio State. In staffing terms, Cal treats football as 74 times more important than English.

Does overstaffing happen only at enormous public universities? Columbia, an Ivy League school, has 71 people in its athletics department. That's not coaches, that's just the A.D. office -- which includes 16 people listed as "senior administration" and a "director of enrichment services," whatever that means.

Coaches? The Columbia football coaching staff has 14 people, including a chaired coach -- the Patricia and Shepard Alexander Head Coach of Football. Not the football coach, the Head Coach of Football. Columbia -- not the Pittsburgh Steelers, Columbia University -- has a guy who specializes in coaching strong-side linebackers.

[+] Enlarge
AP Photo/Paul Hawthorne
Handshakes at the end of an Ivy League contest: "Nice game. My trust fund is bigger than yours."
Big staffs certainly don't guarantee success. Columbia, with its top-heavy football staff, is 11-29 in its past four seasons. The University of Tennessee, with a 28-person football staff, just finished its season with a 6-6 record. Kansas needed a 23-person football staff to finish 3-9. Most likely these schools could have compiled the same records with half as many people on the football staff, or the athletic department staff. The same may be true of even the year's best programs: cut the staff, and on-field results would change little. Does Oregon really need 178 people in its athletic department, including 16 people with some variation on the words "athletic director" in their titles? It is difficult to believe Auburn really needs an athletic director, an executive associate athletic director, five senior associate athletic directors, four associate athletic directors and a guy with the title senior associate athletic director & CFO.

College sports can teach teamwork, cooperation and self-discipline, regardless of whether athletic programs are successful in won-loss terms. The strongest argument for spending on collegiate sports is that imparting life lessons is among the leading goals of the academy. Some staffing for this purpose makes sense.

But overstaffed athletic departments, and football programs, in many cases have ballooned far out of proportion to other priorities at colleges. Even at a sports powerhouse like Ohio State, perhaps one student in 2,000 will go on to earn a paycheck in professional sports, and then for a "career" that lasts a only couple years. If only one Ohio State science or business graduate in 2,000 ever found a job in any field related to their degrees, Ohio politicians and voters would be angrily denouncing the school. If the English Department at Columbia had the same combination, as the football program, of overstaffing and failure to send students on to career success, there would be a scandal.

Yet at a time when states are cutting spending for public universities, and private colleges are reducing financial aid, athletic departments generally -- and football and men's basketball staffs specifically -- continue to be extensively featherbedded. (Does Michigan really need five men's basketball coaches plus a "director of basketball operations"?) Top-heavy staffing in college sports is far more troubling for higher education than some football player who sells a jersey on eBay. Yet bloated staffing, which benefits the well-off and comfortable, continues, while God forbid some recruit from a poor family should eat an unauthorized cheeseburger.


Courtesy of Vanderbilt University
Vanderbilt rationalized its athletic department -- and the world did not end!
Don't you need a gigantic athletic department to run Division I sports programs? That's what the people who work in gigantic athletic departments would like you to believe. Vanderbilt University does not even have an athletic department, despite fielding competitive teams in Division I football, men's basketball and other sports. Vanderbilt closed its athletic department in 2003, folding its functions into the Division of Student Life -- which runs theater and music programs as well -- because the school's trustees felt there was too much emphasis on sports. This story details how Vanderbilt reduced athletic administrative expense without harm to sports programs.


And do not be conformed to this world, but be transformed by the renewing of your mind, that you may prove what is that good and acceptable and perfect will of God.
Romans 12:2 (NKJV)
Greg C.
13 years ago

that actual percentage rate of return turns out to be really small.

"Nonstopdrivel" wrote:



You're right, as usual. A few months ago I read an article in which it stated that the Cowboys organization netted about $10 million last year. People were pointing at that figure as proof that the owners are raking in the megabucks and should be happy to hand over more cash to the players. They never stopped to think, of course, what a minuscule rate of return on a huge investment that represented. Nor did it occur to them, apparently, that there were players on that roster who were earning more in one year than the entire organization was netting.

When you look at the big picture, it's not at all surprising the bankers and venture capitalists want nothing to do with these franchises. The potential reward isn't worth the risk. That question then becomes, of course, why should the taxpayers be forced to shoulder a risk no sane businessman is willing to touch?

"Wade" wrote:



I agree that $10 million would be a very low profit margin for such a big operation. I wonder where that figure came from, though. I googled "Dallas Cowboys profit" and the only figure I came up with was a quarter of a billion dollars, but that was from a web site called answers.com, which I don't think is reliable. However, that is more like the profit I would expect them to make. With the new stadium being built, there could be all kinds of ways for the team to make it look like they made a small profit last year, and it might even technically be true, but I don't think many businessmen would invest in a stadium like that for such a relatively small profit.
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