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Initiative to End Payments to Nationwide Arena

Home Forums General Columbus Discussion Politics Initiative to End Payments to Nationwide Arena

Viewing 15 posts - 871 through 885 (of 899 total)
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  • #556387

    jbcmh81
    Participant

    lazyfish said:
    Nationwide nearly doubles its profit in 2013

    The insurer said yesterday that it had operating profit of $1.4 billion in 2013, nearly double the $741 million it posted in 2012.

    http://www.dispatch.com/content/stories/business/2014/02/13/nationwide-earnings.html

    Glad the taxpayers are helping the ailing business elites of the city.

    Still with this lie. I guess if you can’t win with the facts…

    #556388

    RedStorm
    Participant

    Because the smart business move is to loan $43.3 million and not get paid back for it? That’s not usually how loans work, and especially in this case since Nationwide gave up ownership of the arena.

    #556389

    pilsner
    Participant

    Nationwide gave up ownership but it also gave up liabilities without giving up revenue streams related to the arena. It’s called lemon socialism.

    #556390

    NDaEast
    Participant

    RedStorm said:
    Because the smart business move is to loan $43.3 million and not get paid back for it? That’s not usually how loans work, and especially in this case since Nationwide gave up ownership of the arena.

    Smart business is to get other people to pay your losses, while you take all the profits: Nationwide’s expert financial analysts and investment people are is smarter than our politicians.

    Nationwide is guaranteed 4.875% interest on the outstanding CFA debt. While (given the casino tax receipt shortfall) the bond principle can not reasonably be projected to ever be retired), Nationwide also saves about $9M a year on the operating side (as a co-owner of the Blue Jackets) in addition to the interest income.

    My guess is that Nationwide has also probably used some kind of accelerated depreciation to get the maximum tax (non-cash) expensing of the building, which wouldn’t matter to the City since depreciation has no value to a public entity. Finally, Nationwide may still may be owed as much as $1.9 Billion for the original acquisition of the building by the CFA 100 years from now.

    I have a memo from Nationwide to the City from the 2011 negotiations where Nationwide says a $50M default is a non-starter for Nationwide and they would not proceed further with the deal if there was the risk of that loss. But make no mistake, even though the bonds are not being fully paid now, at some point other public officials will step in and find a way to pay Nationwide in full.

    Meanwhile Nationwide’s profits have risen from 30% more than the entire city of Columbus operating budget, to 60% more than the City’s budget. But we’re bailing them out. They could have at least chipped in a few snow plows.

    #556391

    pilsner
    Participant

    I understand why city and county politicians accommodated Nationwide in the short term but the bailout is going to be a terrible political liability for those who plan to be in local politics in the long term. I suppose Andy Ginther aspires to become mayor if Mayor Coleman ever retires. My question is how does Ginther explain it as the payments to Nationwide keep growing and it becomes common knowledge that it’s a never ending liability to the city. It’s such a bad deal that it has the possibility of electing a Republican mayor down the road as people realize it’s another trash burning plant.

    City Council members would be better off letting voters see it on the ballot so they are off the hook if they want to stay in politics. On the other hand, I’m sure Nationwide has some soft landings for those who submit their resumes.

    #556392
    lazyfish
    lazyfish
    Participant

    jbcmh81 said:
    Still with this lie. I guess if you can’t win with the facts…

    I’m not sure what part you think is a lie. The profit is impressive. The fact that $1,400,000,000 was created by managing risk and capitalizing on peoples perception of risk is awesome. The fact that $45 million is necessary to pay for the arena that bears their name and anchors their development and that sum is a decimal point to the right of 1.4 billion is also pretty amazing.

    How much does Nationwide spend promoting/sponsoring minor league golf and NASCAR? Seems we got stuck with a fuzzy lollipop again.

    #556393

    jbcmh81
    Participant

    lazyfish said:
    I’m not sure what part you think is a lie. The profit is impressive. The fact that $1,400,000,000 was created by managing risk and capitalizing on peoples perception of risk is awesome. The fact that $45 million is necessary to pay for the arena that bears their name and anchors their development and that sum is a decimal point to the right of 1.4 billion is also pretty amazing.

    How much does Nationwide spend promoting/sponsoring minor league golf and NASCAR? Seems we got stuck with a fuzzy lollipop again.

    I was referring to the lie about how taxpayers are “helping the elites”. But we’ve been over all this already. Some people have an interest in selling the idea at any cost.

    #556394

    NDaEast
    Participant

    jbcmh81 said:
    I was referring to the lie about how taxpayers are “helping the elites”. But we’ve been over all this already. Some people have an interest in selling the idea at any cost.

    Not to beat this dead horse, but I sure don’t understand how you can say that is a lie. The elites, who made a private business investment with expectations of private profits and promises of no public money, were losing money and they came to our politicians for a financial deal (McConnell 2001 letter to public officials asking for help).

    They got a deal that takes away a major cost at the public’s expense, and helps to create private profits. According to Forbes Magazine, the Blue Jackets profited of $4.9M last year with public ownership of the arena (BJ 2013 Operating Income [/url])after losses of $18.7 in 2012 (BJ 2012 Operating Losses[/url]).

    Unless you believe John McConnell and the other Blue Jackets investors are just regular folk like you (I am presuming) and me, how is that not “taxpayers helping the elite”?

    #556395

    jbcmh81
    Participant

    NDaEast said:
    Not to beat this dead horse, but I sure don’t understand how you can say that is a lie. The elites, who made a private business investment with expectations of private profits and promises of no public money, were losing money and they came to our politicians for a financial deal (McConnell 2001 letter to public officials asking for help).

    They got a deal that takes away a major cost at the public’s expense, and helps to create private profits. According to Forbes Magazine, the Blue Jackets profited of $4.9M last year with public ownership of the arena (BJ 2013 Operating Income [/url])after losses of $18.7 in 2012 (BJ 2012 Operating Losses[/url]).

    Unless you believe John McConnell and the other Blue Jackets investors are just regular folk like you (I am presuming) and me, how is that not “taxpayers helping the elite”?

    It is beating a dead horse, as you say. We’ve been over all this many times. You have a problem with the deal, you have a problem with casino money going to the deal. You have an agenda that goes beyond the deal, so you and a few others are trying their absolute best to make this into a taxpayer vs. evil corporation story. It’s not, but hey, whatever it takes to get to your goal, right.

    #1023134

    RedStorm
    Participant

    http://www.dispatch.com/content/stories/local/2014/06/08/financial-thin-ice.html

    Even after the bailout, Nationwide Arena is struggling to turn much of a profit.

    #1023143
    Coremodels
    Coremodels
    Participant

    When your primary tenant pays no rent, it isn’t exactly a plan for success.

    #1023616
    Caleb
    Caleb
    Participant

    Nationwide Arena now expected to turn a little profit
    By Lucas Sullivan
    The Columbus Dispatch
    Wednesday June 11, 2014 6:55 AM

    Several months ago, the panicked general manager of Nationwide Arena walked into the office of Columbus Blue Jackets’ President Mike Priest with a warning: The arena could finish its fiscal year with a seven-figure deficit.

    But yesterday, the manager — Xen Riggs — presented budget documents that show that Nationwide should eke out a $60,000 surplus when its fiscal year ends June 30. He then cautioned that next year, the arena likely will finish with a deficit of about $500,000.

    Both of those budgets include a $4 million public subsidy of casino tax dollars from the city of Columbus and Franklin County.

    As of April, the last full month for which accounts are finished, the arena had a $426,000 surplus. That’s in part thanks to some big shows, including Bruce Springsteen, Cher and Demi Lovato, that weren’t expected back when Riggs projected the big deficit.

    READ MORE (paywalled): http://www.dispatch.com/content/stories/local/2014/06/11/arena-now-expected-to-turn-a-little-profit.html

    #1023650

    CB_downtowner
    Participant

    We have to always remember that any surplus or deficit should also factor in the bump in revenue for surrounding businesses because of the games and events. As the CBJ get better and the city becomes more attractive for conventions and events, that overall benefit is only going to grow.

    #1023747

    News
    Participant

    2015 Nationwide Arena Budget Approved; Venue Barely In The Black
    June 11, 2014
    by Sam Hendren
    89.7 NPR News Reporter

    The board that oversees Nationwide Arena has approved the facility’s 2015 budget. Recent media reports say the arena is struggling financially but the facility’s chief operating officer disagrees.

    READ MORE: http://wosu.org/2012/news/2014/06/11/2015-nationwide-arena-budget-approved-venue-barely-black-1/

    #1023803

    UrbanPlanner2112
    Participant

    We have to always remember that any surplus or deficit should also factor in the bump in revenue for surrounding businesses because of the games and events. As the CBJ get better and the city becomes more attractive for conventions and events, that overall benefit is only going to grow.

    ^^ This. ^^

    Since the time of the Romans large public venues have never been profit centers. They’re cultural anchors that contribute to the larger economic picture.

    Of course there is also a limit to how much of a subsidy is practical for any public project, and those are the details that you need to work through.

Viewing 15 posts - 871 through 885 (of 899 total)

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