What is best for the Tax Payer? (1 Viewer)

lewys33 · Oct 1, 2013

Considering Les Reid and others have used this "What is best for the Tax Payer" argument, I was wondering what people's stance on this is? Whenever I have questioned it nobody has given me a proper response.

I personally don't think either side can use this as an argument because in the real world if we are talking what is best for the tax payer then it is not to get Coventry back at the Ricoh. The best possible scenario for the taxpayer to get the best return is surely to sell to the highest bidder? Whether it be a property development company or otherwise. Which it doesn't take a genius to work out is not JS.

Obviously not the best scenario for us as fans, however if Joy is adament we will only come back to the Ricoh if she can buy it, then that is not the best scenario for the tax payer if she is not willing to pay market value. Am I wrong?

Nick · Oct 1, 2013

Does it make a difference either way for the tax payer? I very much doubt it so I don't really see why they are brought into it.

RPHunt · Oct 1, 2013

Absolutely right - and those urging the council to do something should realise that councils do not have an obligation to find accomodation for homeless football clubs or to assist private equity funds to make money.

torchomatic · Oct 1, 2013

Stalemate then. A homeless football club and an empty football stadium. No one wins.

RPHunt · Oct 1, 2013

torchomatic said:
Stalemate then. A homeless football club and an empty football stadium. No one wins.

Rather easier to adapt a football stadium than a football club.

RoboCCFC90 · Oct 1, 2013

As a Tax Payer I believe that government funding can be used in better areas of our community and within budget then to maintain a Football Stadium with no tennant.

torchomatic · Oct 1, 2013

Easy? You reckon? Bloody expensive. Would that be value for money for the Coventry taxpayer?

RPHunt said:
Rather easier to adapt a football stadium than a football club.

torchomatic · Oct 1, 2013

And with Councils having to set their budgets next year and with even less money coming from central government there won't be a lot of money around to "adapt" a stadium for a while. Four more years of pain, so kiss goodbye to all your services, folks.

RoboCCFC90 said:
As a Tax Payer I believe that government funding can be used in better areas of our community and within budget then to maintain a Football Stadium with no tennant.

lewys33 · Oct 1, 2013

RoboCCFC90 said:
As a Tax Payer I believe that government funding can be used in better areas of our community and within budget then to maintain a Football Stadium with no tennant.

I agree. So sell to highest bidder? Or convert to something of use for tax payer.

Nonleagueherewecome · Oct 1, 2013

"oh yeah, the taxes, the finger thing means the taxes...".

Sorry, just wanted to get my third Simpson's quote in 10 minutes in

RoboCCFC90 · Oct 1, 2013

lewys33 said:
I agree. So sell to highest bidder? Or convert to something of use for tax payer.

Converting would mean spending more money which I hazard a guess wouldn't.. a) be fondly received by tax payers if the council chose to spend it in those means? b) The council have much more budget to spend on conversions?

RoboCCFC90 · Oct 1, 2013

torchomatic said:
And with Councils having to set their budgets next year and with even less money coming from central government there won't be a lot of money around to "adapt" a stadium for a while. Four more years of pain, so kiss goodbye to all your services, folks.

Exactly Torch, a decision needs to be made now for the sake of Tax Payers and for the Council, they could make all the hassle and bad negativity dissapear with a sale of the Arena.

thaiskyblue · Oct 1, 2013

RoboCCFC90 said:
Exactly Torch, a decision needs to be made now for the sake of Tax Payers and for the Council, they could make all the hassle and bad negativity dissapear with a sale of the Arena.[/QUOTE
sisu to the rescue again........don't make me laugh robo.

RPHunt · Oct 1, 2013

torchomatic said:
And with Councils having to set their budgets next year and with even less money coming from central government there won't be a lot of money around to "adapt" a stadium for a while. Four more years of pain, so kiss goodbye to all your services, folks.

Perhaps, but they could save a fortune by sacking the idle buggers that spend all day posting on internet forums rather than doing the job they are paid to do.

RoboCCFC90 · Oct 1, 2013

thaiskyblue said:
RoboCCFC90 said:

Exactly Torch, a decision needs to be made now for the sake of Tax Payers and for the Council, they could make all the hassle and bad negativity dissapear with a sale of the Arena.[/QUOTE
sisu to the rescue again........don't make me laugh robo.

Click to expand...

I wasn't intending to make you laugh either a sale needs to be made to the Football Club in which the Arena would be utilised fully as it was designed for or it is sold to a private party who can develop the land around it or the Arena itself.

thaiskyblue · Oct 1, 2013

RoboCCFC90 said:
thaiskyblue said:

I wasn't intending to make you laugh either a sale needs to be made to the Football Club in which the Arena would be utilised fully as it was designed for or it is sold to a private party who can develop the land around it or the Arena itself.

Click to expand...

we wont know any thing till the jr robo, more time for sisu to let us hear their manifesto, yawn !

torchomatic · Oct 1, 2013

Good idea. I'll suggest that.

RPHunt said:
Perhaps, but they could save a fortune by sacking the idle buggers that spend all day posting on internet forums rather than doing the job they are paid to do.

Astute · Oct 1, 2013

Stop hedge funds like SISU playing the system.

Not on about the Ricoh here. They were landed with a tax bill. So they put it into CCFC LTD then put CCFC LTD into admin. All the proof is out there on what they have done.

lewys33 · Oct 1, 2013

RoboCCFC90 said:
I wasn't intending to make you laugh either a sale needs to be made to the Football Club in which the Arena would be utilised fully as it was designed for or it is sold to a private party who can develop the land around it or the Arena itself.

This is my argument though ...... if we are talking solely on the purpose of getting the best return for the taxpayer it is not to sell it to JS or the football club if they are not going to pay as much as other potential buyers?

Warwickhunt · Oct 1, 2013

RPHunt said:
Absolutely right - and those urging the council to do something should realise that councils do not have an obligation to find accomodation for homeless football clubs or to assist private equity funds to make money.

or shoring up the finances of a failing Arena Management company either

Badger · Oct 1, 2013

There is also business rates to consider. While CCFC are away surely there are local businesses in danger of going under, therefore no rates from these properties

RoboCCFC90 · Oct 1, 2013

thaiskyblue said:
we wont know any thing till the jr robo, more time for sisu to let us hear their manifesto, yawn !

I don't see how the sale of the Arena could depend on the JR, at the end of the day if CCC/ACL sold the Arena, SISU may drop the JR.

lewys33 · Oct 1, 2013

Warwickhunt said:
or shoring up the finances of a failing Arena Management company either

on the basis that they were not recieving payment? You can't use that as an argument because if they hadn't done that every tax payer (especially the ones who couldn't care less about the football team) would be slagging them off on the basis that they let a hedge fund take them to the cleaners. There would be very little return to the tax payer if they had let that happen.

RoboCCFC90 · Oct 1, 2013

lewys33 said:
This is my argument though ...... if we are talking solely on the purpose of getting the best return for the taxpayer it is not to sell it to JS or the football club if they are not going to pay as much as other potential buyers?

Agreed. The best thing would be if CCC sold the Arena to the Football Club IMO.

Selling it to a another party like Haskell achieves nothing.

lewys33 · Oct 1, 2013

RoboCCFC90 said:
I don't see how the sale of the Arena could depend on the JR, at the end of the day if CCC/ACL sold the Arena, SISU may drop the JR.

SISU won't drop the JR. But I don't see anything else wrong with that statement. Unless things are going on behind the scenes ......

chiefdave · Oct 1, 2013

It's not a straightforward question as you can take 2 approaches.

The first would be purely financial. Currently the council own the freehold and 50% of ACL. The value of the freehold I wouldn't have thought was being impacted too much as in the council document detailing build costs they indicated the value of the freehold was minimal while a lease was in place.

In terms of ACL at the moment, according to their filed accounts, they are a profit making company who have been making overpayments on their debts to clear them as quickly as possible. The recent restructuring at ACL both in terms of staffing and their debt commitments lowers the impact of CCFC not being there hence while they were able to offer a much lower rent. You will really need to wait around 2 years to see if ACL are a viable company without CCFC as you have to account for the long lead times a lot of the events of the type held at the Ricoh have.

I think people are making a mistake assuming a replacement tenant is needed. The maintenace costs of the stadium can't be massive and are probably covered by one or two concerts every summer, a representative match here and there and whatever else they can pick up. It may well be the case that ACL can more than cover the loss of CCFC as they now have more dates free and can increases revenues in other areas of the business.

If it is the case that ACL is still profitable, or even just breaking even, without CCFC then from a financial standpoint the best thing for the taxpayer is to hold on to the Rioch unless of course a full market value bid is made by a private company which would mean they could sell up at a profit, presumably to be reinvested to the benefit of the taxpayer. Worse case scenario is that ACL get into trouble and can't meet the repayments, lease then reverts to the council, the expose of £14m in debt would be offset by the value of the lease but you could of course argue how much the lease is worth.

The other way to view it is from a community asset standpoint. This is harder to evaluate as you would need to determine what is an acceptable amount of funding for the council to provide to allow ACL to continue operation. This isn't unusual, here in Pompey the 2 biggest venues (Guildhall and Pyramids) are both run by ACL type organisations but are both subsidised by the council (Pyramids for example gets around a million a year to cover operational losses). The theory being that the value to the community is greater than the amount being spent and that it is part of the councils responsibility to provide leisure facilities. Let's face it, without the Ricoh would we have seen the likes of Bon Jovi, Muse, Springsteen etc in Coventry?

If the council were to hand the stadium over to SISU then the very least they have to do is ensure they cover everything that has gone into the project, if they achieve that then you can make an argument that there is no loss to the taxpayer.

lewys33 · Oct 1, 2013

Badger said:
There is also business rates to consider. While CCFC are away surely there are local businesses in danger of going under, therefore no rates from these properties

I wouldn't suggest that businesses will go under from all this, however you are right business can't be doing as well without CCFC at the Ricoh. So in order to get the economy in the area going again the best outcome for the taxpayer (not neccessarily the CCFC fan) is to sell it to the highest bidder. Whether they want to knock it down and build houses (more people in the area to use shops/pubs) or build a factory of some kind (more jobs etc.) or to use the Ricoh for some other way it could all work out better for the taxpayer.

lewys33 · Oct 1, 2013

RoboCCFC90 said:
Agreed. The best thing would be if CCC sold the Arena to the Football Club IMO.

Selling it to a another party like Haskell achieves nothing.

As a CCFC fan the above is correct. As a taxpayer it is not.

Nick · Oct 1, 2013

lewys33 said:
As a CCFC fan the above is correct. As a taxpayer it is not.

As a tax payer, how would you be worse off?

lewys33 · Oct 1, 2013

Nick said:
As a tax payer, how would you be worse off?

JS paying less than market value for the Ricoh. Is that not clear?

Nick · Oct 1, 2013

lewys33 said:
JS paying less than market value for the Ricoh. Is that not clear?

But I'm asking how that would make you worse off?

chiefdave · Oct 1, 2013

Nick said:
But I'm asking how that would make you worse off?

It's worse off against potential income I assume.

To use everyone's favourite house analogy if your house was worth £500K but you sold it to someone for £100K you're £400K worse off even tho you haven't actually ever had that £400K.

At least that's what I assume people mean. I think you can also make an argument that so long as the council cover everything they've put in then no money have been lost.

RPHunt · Oct 1, 2013

Nick said:
But I'm asking how that would make you worse off?

If you don't believe he would be worse off, then is there any reason why every council in the country shouldn't give all their assets to your favourite private equity fund?

lewys33 · Oct 1, 2013

chiefdave said:
It's not a straightforward question as you can take 2 approaches.

The first would be purely financial. Currently the council own the freehold and 50% of ACL. The value of the freehold I wouldn't have thought was being impacted too much as in the council document detailing build costs they indicated the value of the freehold was minimal while a lease was in place.

In terms of ACL at the moment, according to their filed accounts, they are a profit making company who have been making overpayments on their debts to clear them as quickly as possible........

Including the rest of your quote - I completely agree. This also includes another thing I disagreed with Les Reid on. We cannot currently know how ACL will do without CCFC.

Im going to dot a few figures down now .... PLEASE DO NOT QUOTE ME ON THIS AS FACT! I am only going on memory so cannot prove anything but from what I remember with CCFC paying £1.3 million rent ACL were showing £1million profit. ACL were paying £1million a year on the mortgage.

Obviously without CCFC paying they got in to difficulties and CCC bought out the mortgage. From memory this halved the mortgage to £500,000.
so remove the £1.3 million rent, but also take in to account the rent has been reduced to £500,000 then roughly it works out to be £200,000 profit a year?

Obviously there a lot of other things to take in to account but when Les Reid was claiming that the Ricoh cannot cope financially without CCFC it did make me consider the above. It could still be possible for ACL to survive without CCFC.

paulcalf · Oct 1, 2013

Best for the tax payer would be to sell the freehold to the Ricoh on the open market.

Whilst ACL hold a lease, the freehold probably won't be worth as much as selling the Freehold without a lease.

I agree that the Club need to benefit from the income generated by the ground they play in. That doesn't mean I think the Council should sell the Freehold to SISU/Otium.

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