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The state can't afford paying

this is a discussion within the Saints Community Forum; i believe the saints are a positive economic impact to new orleans. forgive my ignorance though, if the tourism tax generates 25mil where is it going? i thought the state\'s beef is that tourism income has fell off after 9/11 ...

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Old 02-03-2005, 10:15 AM   #11
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The state can't afford paying

i believe the saints are a positive economic impact to new orleans. forgive my ignorance though, if the tourism tax generates 25mil where is it going? i thought the state\'s beef is that tourism income has fell off after 9/11 and not recovered yet, thus the shortfall in revenue for the subsidy payment.
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Old 02-03-2005, 10:16 AM   #12
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The state can't afford paying

Halo --

That\'s one way of looking at it. But....... I don\'t know.

You\'re saying because the Saints directly create tax dollars from tourism and other means, that they are entitled to receive a percentage of that back?

It seems fair on face value.

But........that isn\'t the way it works for other companies who created tax dollars. Even in the tourism industry..

Here on the Mississippi Gulf Coast, we have casinos who bring in tremendous tax dollars generated by tourism that wouldn\'t be here otherwise.

You know what percentage those casinos get back? None. Notta.

In fact, there\'s talk that the state of Mississippi wants to rasie their taxes.

The casinos have said if that happens that they will not expand any of their opperations in Ms. But they aren\'t threatening to leave...

I see no real difference between the Saints and the casinos in Mississippi. They\'re both making money.

The only real difference is ...... well, there really isn\'t one that I can think of. Except somehow a football team should be treated differently..

Maybe someone can show me the light?
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Old 02-03-2005, 10:34 AM   #13
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The state can't afford paying

Ok, to answer both of you, after 911 the travel and tourism business sunk nationwide. The deal called for incramental increase in payments every year. The state has been falling short because the deal didn\'t account for something like 911 and the Saints have been forgiving.

But the travel and tourism business is on the up and up again and New Orleans is booming.

Point one (LKelley)What do they do with the money? The State taxes New Orleans and takes that money and funds the rest of the State. So money tax payers pay in N.O. help build schools in Baton Rouge or pave local roads in Bunkie. With 911 and income dropping, this issue has arrisen that the State \"does not have enough money to pay the Saints\" but in reality the State doesn\'t want to lower it\'s share of the money to compensate the Saints what they deserve.

Point 2 (GumboBC) - The Saints want more money because they claim they make less than the average team because they are in New Orleans which is a small market. This is all driven by the NFL to make it\'s franchises more profitable. Let\'s say the Saints make an income of (5) and average teams make (7) so (2) needs to be give to the Saints to compensate. It\'s a radical concept that the Saints and NFL invented.

Saints claim \"if you want us, then you have to pay this amount to keep us \'competative\' with the rest of the NFL, otherwise we have to move\" and this all comes because the NFL is telling them that.

Let\'s say you own a McDonald\'s franchise in a neighborhood and the neighborhood starts going bad. Profits drop and McDonalds tell you \"either pick up the profits or you must move to where you can make more-it\'s the only way you can stay as a McDonald\'s franchise.\" The franchise employs 30 people from the neighborhood and impacts the economy and the neighborhood has a burger tax on every burger and fry sold. The owner says \"we need a part of that tax to help make us profitable or we have to move\" so the neighborhood splits the tax so the McDonalds stays and everyone is happy.

I mainly agree with this and I know that casinos don\'t do this, but the Saints are a lot more. Everytime you see the Saints on TV, it sells New Orleans. Everytime the Saints lose to someone and it\'s in every paper in the US, it sells New Orleans. So every station in the US like Fox and NBC always include New Orleans in the weather forecast because people are going there and they have to know the weather for the game (although it\'s in a dome) but everytime they do that it sells New Orleans and profits go up. For a casino when you see \"Copa\" or \"Bally\'s\" it\'s not selling the coast, it sells Bally\'s or Copa because you can also go to Bally\'s in Las Vegas or Atlantic City.

The Saints are a brand that are one with New Orleans and are synonymous. Without them the State and City lose bad. No more weather forecasts, no more making the 8th page of the paper nationwide in the fall, no more advertisements during games of guys at Acme oysterhouse shucking oysters...


Now, I have to go to the Dr appt, if you guys want to ask more I will answer but it won\'t be until tonight.


Luv you guys.

[Edited on 2/3/2005 by Halo]

[Edited on 2/3/2005 by Halo]

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Old 02-03-2005, 10:57 AM   #14
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The state can't afford paying

Alright, I\'ll go through this one more time. The State of Louisiana pays no money to the Saints. The State taxes the crap out of tourists who go to New Orleans and the conscessions at games, and this makes about $25million (and growing) for the State. This money from the tax comes directly from the Saints and because the Saints are in town and people come from all over -Mississippi and Houma and sourrounding areas- and spend $ in New Orleans during the fall.

The Saints say they want a part of this money because it\'s generated by them and it\'s only here because of their presence. So the State gives the Saints $15 million a year and the State walks away with $10million for them selves.

If the Saints leave, the State stands to lose 10 to 15 million plus a year because the Saints are gone. This would be the largest economic blow to the State, as large as losing Entergy or Freeport-MacMoran or Avondale shipyards. If the Saints move in years to come there will be people crying because there will be some schools with no toilet paper to wipe their children\'s backsides and they will blame it on the loss of the Saints and the 10 to 15 million dollars we lost per year because we didn\'t want to pay them their part of the revenue share.

Does everybody understand now?
Wrong. You say that the state makes $25 million from taxes and the concessions at the games. That\'s your figure which I\'ll accept because I don\'t know.

Then you say that Benson wants part of the money and claim it\'s 15 million. Isn\'t the payment closer to 20 mil this year? It\'s going to be over $23 mil before long. But using your figure, that\'s then a net of 10 mil to the state.

From this we must subtract all the little headaches created by having the team here and playing games here. There\'s extra police to direct traffic, and every traffic jam has auto accidents which cost state and locals governments money. I\'m sure with all the extra tourists in town crime goes up, more people are injured, and there is a requirement therefore for more police protection. I can only guess how much all of this might cost the state and local governments. I\'m just gonna say an additional 2 mil a year and that is very conservative, I\'m sure.

So, last year the state made 8 mil - maybe. Don\'t forget that the state finainced and built a stadium for Benson\'s team to play in AT NO COST TO BENSON. In a couple more years under this deal the state will only break even, while as I discussed in another thread Benson will be making at a minimum $40 mil a year.

Now, regardless of anything I said above being correct, the last argument is that the state is deserving of the $25 mil because it has provided Benson with a place to own a franchise and a place for his team to play. So, to give any portion of that money up would be the taxpayers of Louisiana giving up what is rightfully theirs. I agree a contract was signed, but I\'m sure you\'d have to agree it was signed pretty much under extortionist tactics by Benson - since he was threatening to move.

The bottomline is no other state does this sort of thing for its team. Benson knew where the Saints were located when he purchased them and knew also that the State\'s economy wasn\'t good after the oil boom ended. There was nothing to indicate that the state would ever get dramatically better financially. So, boo hoo to him that he isn\'t making as much as other franchises. You think McDonald\'s cares if one of it\'s franchised stores doesn\'t make as much as some other stores in better locations. No, that is all on the owner of that particular store and his decision to locate there.

Finally, how much is Benson actually to blame for his lower profits? He\'s owned the team 17-18 years and has only one playoff victory to cling to. 5 playoff trips in all. There\'s no guarantee that we\'ll make the playoffs in the next 2-3 yers so at that point he\'ll have an org that makes the playoffs a mere 25% of the time and wins a playoff game only 2% of the time.

But no, he keeps giving us a mediocre team at best while expecting winner returns. He pinches every penny and cries when fans do the same. He is part of the problem and fully responsible for his own financial condition yet expects a struggling state to pay additional kickbacks.

So, when Benson gets all of the tax money and concession money, what will be the benefit to the state then?
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Old 02-03-2005, 10:58 AM   #15
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The state can't afford paying

Halo --

Okay. Point taken. You said basically what I said in a previous post. Although you expanded on what I said.

I\'ll agree with you.

I do agree that the NFL and other businesses are different in some regards.

But, I don\'t think those differences are the tax dollars the Saints generate vs. tax dollars generated by some of the other type businesses.

I think the only real difference is the presedent that has been set by other states as it relates to the NFL.

Other states have set a presedent by offering NFL owners large amounts of cash for stadiums and other needs.

What that did was it gave other NFL owners a big bargaining chip to use in the state in which their perspective team resides in.

They can simply say, hey..... Florida gave one of their teams x amount of dollars and as an NFL owner, I need that also.

But, IMO, that doesn\'t make it right. Or fair.

Louisiana doesn\'t have the money other states have. And when the Saints came to Louisiana, there was no agreement that the State would EVER give the Saints any money.

So, I don\'t think there\'s necessarily a right or wrong side here.

Benson is looking out for Benson, and the State is looking out for the State.

My opinion is...... If the State can give Benson the money he needs ....... and the state can still make money......then, they should do it.

But, who\'s to say Benson won\'t be back with his hand out very soon.

This isn\'t as simple as it might sound......IMO..



[Edited on 3/2/2005 by GumboBC]
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Old 02-03-2005, 11:07 AM   #16
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The state can't afford paying

Let\'s say you own a McDonald\'s franchise in a neighborhood and the neighborhood starts going bad. Profits drop and McDonalds tell you \"either pick up the profits or you must move to where you can make more-it\'s the only way you can stay as a McDonald\'s franchise.\" The franchise employs 30 people from the neighborhood and impacts the economy and the neighborhood has a burger tax on every burger and fry sold. The owner says \"we need a part of that tax to help make us profitable or we have to move\" so the neighborhood splits the tax so the McDonalds stays and everyone is happy.
That funny. You used a McDonald\'s reference too.

I don\'t think you\'e right here though. The McD corp very well may force the franchise to move or close, but they wont help you demand from the neighborhood a tax break in order to make you competitive. You chose the location, location, location, after all.

But take that McD store which is only open 8 weekends a year and does not provide quality food, should the neighborhood really kick in a tax break to help it? There are other fast food chains open year round which generate much more french fries tax than does this McD store. Should the neoghborhood simply break even at best, just so it can say it has a McD store?

Not in my mind they shouldn\'t.
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Old 02-03-2005, 11:14 AM   #17
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The state can't afford paying

in reality the State doesn\'t want to lower it\'s share of the money to compensate the Saints what they deserve
why don\'t i hear the saints volleying this fact? it seems it should be easily identifiable and accounted for if so.

the other side of the coin is the saints are in the bottom half dozen teams in market size and revenue- but not the bottom certainly. no other owner has any subsidy/padding to any degree near what benson is receiving. to write out a 15-20mil dollar check yearly, i think asking for a 3rd party auditor to verify his claims of going to the poor house is entirely reasonable.

i think louisianaians want to keep and support the saints. but support the needs of the franchise not pad the pockets of an owner that only has a growing rep as a notorious tightwad. transparency would go a long way but neither franchise owners or louisiana politicians are famous for that.

a good read here on stadiums and subsidies if anyone cares to peruse-
http://www.calvertinstitute.org/main...l.php?pub_id=3

[Edited on 3/2/2005 by LKelley67]
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Old 02-03-2005, 11:22 AM   #18
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The state can't afford paying

Everytime you see the Saints on TV, it sells New Orleans. Everytime the Saints lose to someone and it\'s in every paper in the US, it sells New Orleans. So every station in the US like Fox and NBC always include New Orleans in the weather forecast because people are going there and they have to know the weather for the game (although it\'s in a dome) but everytime they do that it sells New Orleans and profits go up. For a casino when you see \"Copa\" or \"Bally\'s\" it\'s not selling the coast, it sells Bally\'s or Copa because you can also go to Bally\'s in Las Vegas or Atlantic City.
I disagree here too. It may put the name New Orleans out, in fact, it does. But I cannot believe it is actually selling people to come here just to be mentioned along with the football team. Never once when I\'ve seen the forecast in Buffalo or Seattle or San Diego have a thought that I\'d like to go to that city anymore than I have had that thought on my own. Maybe I\'m just different. I never read or heard of any studies that indicated just what value the mentioning of the name of the city along with the team has for the tourism of that particular city outside of football.

I will grant you that when they are showing shots of the city during the game and showing burbon street or when they\'ve shown the Arch in St. louis or niagra falls and such, that is good advertising for the city. The weather reports and box scores don\'t provide that type of advertising, imo.

This all just my gut feeling based on what limited knowledge I have on the subjects. Halo, my first word above to you was \"wrong\". Temper that wrong with my acknowledgement that I am no expert on this issue.
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Old 02-03-2005, 11:28 AM   #19
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The state can't afford paying

i came across this which is powerful. forgive the length but it is absolutely current and relevant-

Washington Monthly, January 30, 2005
Kevin Drum

INSIDE THE NFL....I don\'t live in Los Angeles, but I live close enough that I can take some civic pride in perhaps the finest show of municipal stubbornness on offer in the nation today: LA\'s decade-long refusal to spend one thin dime of public money on begging an NFL team to take up residence here.

With that in mind, Scott Gold has a fascinating piece in the LA Times today suggesting that the NFL actually likes this situation just fine. Why? Because with LA looming in the background, teams in other parts of the country have an easier time extorting concessions out of their cities by threatening to move if they don\'t get what they want. Gold suggests this has been the case in New Orleans, Seattle, Phoenix, and Indianapolis, and while sometimes the LA card is kept in the background, sometimes it\'s not:

[Indianapolis Colt owner Jim] Irsay\'s flirtation with Los Angeles was not subtle; at one point he applied for membership at the Riviera Country Club in Pacific Palisades.

So how long can other NFL clubs keep pulling this Godfather act? Gold says probably not for much longer:

The irony, said Andrew Zimbalist, a sports economist and a professor at Smith College in Massachusetts, is that in the end, the NFL probably won\'t let any of the franchises that have threatened to move actually do it. Zimbalist thinks it more likely that the NFL will add a new team.

Many analysts say the strategy of using Los Angeles for leverage is about to run its course — just as communities and government officials are getting wise.

It is virtually certain that no public money, at least in the form of general funds, will go toward building a stadium or renovating an existing one in Los Angeles.

The rest of the nation will then realize that stadium projects can be completed with private money alone, said David Carter, an L.A. sports consultant who has been keenly involved in the effort to get an NFL team back in Southern California.

If that had been clear 10 years ago, team owners would have had no leverage because taxpayers would have called their bluff, Carter said. Instead, he said, \"If Southern California goes last, the NFL gets the best of both worlds.\"

The amount of taxpayer money that the NFL has suckered out of gullible working class sports fans for stadium deals that mostly benefit the ultra-rich is probably enough to save Social Security for the next century. But hey — don\'t let it bother you too much. After all, it\'s not personal, it\'s just business. Capiche?

the la times article referenced-
http://www.latimes.com/sports/la-sp-...ck=1&cset=true

[Edited on 3/2/2005 by LKelley67]
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Old 02-03-2005, 11:37 AM   #20
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The state can't afford paying

LKelley67-

Thanks for that article, dude. Very good read.

And I agree with it 100%.

But, if it comes down to it, I want Benson to get his money if it comes down to the Saints leaving.


Let\'s face it, if the Saints leave, the state will lose money. No matter how you slice it. That\'s not a wise move to me.
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