Thursday, July 21, 2005

"People have to realize these facilities aren't built to make money"



Although there is talk of building a performing arts centre, the debt-ridden ripoff known as the John Labatt Centre continues to cost Londoners, including people like myself who refuse to set foot into the monstrosity. Unless you are into hockey hair and the retro circut, there isn't much to see.

So what does council propose to do about the $4.5 million annual cost to taxpayers? Rather than taking it out of the pockets of the asses who voted to build it, the board of control has decided to build a small surcharge into the price of tickets ordered online. It is estimated that this will raise about $200,000. I am all for the people who actually use the facility paying for it, but what's $200,000 when you are looking at a debt that amounts to millions?
Online ticket buyers could be dinged an extra dollar for tickets to make London's John Labatt Centre more profitable.

Yesterday, board of control approved a recommendation for the surcharge to offset the city's debt payments on its new arena.

"At the end of the day, it's still costing taxpayers $4.5 million a year," said Deputy Mayor Tom Gosnell.

[..] But there'll be no surcharge on tickets bought at the box office, because JLC officials warn performers would object, since the higher price could discourage buyers.

[..] Controller Gord Hume, a big supporter, again argued criticism of the deal and the city's share is unfair.

"I think the city did that project the right way and the partners (Global Spectrum) are a critical element of that success," he said yesterday.

Hume also pointed out the city's debt payments will go down almost 25 per cent once the land is paid for in 2007. He noted the city will eventually get a larger share of profits.

In April, city council directed staff to explore ways to increase revenue from the JLC to offset the debt costs.

In a report to the board, finance manager Vic Cote said a $1 surcharge would bring in $200,000 for city coffers.

[..] Last year, more than 600,000 people visited the arena, 50 per cent more than projected before it opened in 2002.

The crowds produced revenue of $12.3 million, earning a profit of $600,000 for London Civic Centre Corp.

The city received $150,000 but paid $4.5 million on debt for the $42-million facility.

[..] Global Spectrum's chief executive and president, Mitch Sauer, said yesterday the deal with the city is a good one despite the debt payments.

"People have to realize these facilities aren't built to make money," Sauer said.
You got that right Sauer - it's all about bread and circuses.

3 comments:

Paul said...

In the interest of fairness, this isn't the first such public-use facility. It's not like Centennial Hall was ever a profit center for the city. Nor was it ever a quality concert venue.

Lisa said...

Paul;

In the interest of fairness, none of these public facilities should have built using money stolen from unwilling taxpayers in the first place. I don't care about 'quality concert venues' and so why should I, and others of like mind, be forced to fund such structures? If there is such a high demand, why don't private companies make the investment? The point of course is, such places are money pits and do not generally offer a feasible return.

The JLC is a favorite target of mine because it costs a bundle, just like the Convention centre and most certainly Hume's cherished performing arts centre, when it gets built.

Anonymous said...

Remember the 'original' deal based on conservative estimates estimated the City getting annual profit share of approx $500,000. But a few City staffers in the back pocket of Global Spectrum 'amended' the deal and slipped in wording allowing Global to siphon out all profits as 'management fees' and what ever was left the City got a share of which had to be at least $50,000. Some people would call this FRAUD .. but corruption at the very least.

Incidently a City Manager involved in this deal (Clive Matthews) quit the City the day before the JLC opened and he became a Global SPectrum Director .. and got his kick back and now is living in his seven figure new house paid for by London taxpayers.