MCG Stadium Agreements and Negotiations

[The_Wookie]

Ill try to cover as many as I can in this thread as I move along to provide updates, but starting with the MCG agreement. ive changed my mind and made this exclusively MCG related. Try as hard as I can, I havent been able to find any text, official or media with details on the 1992 deal signed in 1989.

Melbourne Cricket Ground

• Owner: MCG Trust (Government of Victoria)
• Operator: Melbourne Cricket Club
  
• Capacity: 100,008
• Catering: Epicure (Spotless)
  
• Home teams: Melbourne, Richmond, Collingwood, Hawthorn

The 2002 Renegotiation

I cant find media releases or MCG/MCC reports for this. The 2002 AFL Annual Report makes some notes

Final agreement was reached with the MCG Trust and MCC in 2002 for the AFL to contribute an additional $5 million per year, indexed for 32 years. for the redevelopment of the MCG, a process which will be completed for the 2006 Commonwealth Games.

Between 70% and 80% of the total revenue generated by the operation of the MCG is directly related to AFL matches at the stadium.

The additional $5 million a year is a further significant contribution by football and its supporters. In part the redevelopment will be funded by a user pays levy of $1 on all adults attending AFL premiership season matches at the MCG, $5 for finals matches and $8 for the Grand Final. The balance will come from AFL consolidated revenue.

During negotiations with the Melbourne Cricket Club and MCG Trust we were not able to substantially change the condition of the 1989 agreement between our respective organisations which requires one final to be played at the MCG during each of the four weeks of the finals.

The new agreement does allow us to "bank" finals so that in any three year period, we will average four finals at the MCG each year including preliminary finals and the Grand Final.

- Wayne Jackson, CEO Report, AFL 2002 Annual Report

References

• AFL 2002 Annual Report

The 2005 Renegotiatian

The detail of the new agreement included:

• Removing the requirement to play one preliminary final per year at the MCG when two interstate teams earn the right to a home game.
• Ensuring all Preliminary finals played in Victoria to be played at the MCG;
• Allowing greater flexibility to bank finals in weeks one and two, with the clause amended to ensure 10 matches are played over five years;
• Delivering an additional 4 Home and Away matches to the MCG each season, taking the number of matches played to 45.
• Delivering 14 Collingwood Home and Away matches at the MCG;
• The AFL making the MCG available for other major sporting events on a limited basis;
• The MCG will host Representative football matches if they are scheduled in Melbourne; and
• Provision to review the Agreement every five years, but only to the mutual benefit of both parties.
• Further to these changes, the parties have re-confirmed that the Grand Final will remain at the MCG.

2005 AFL Annual Report

After lengthy negotiations, we successfully concluded a newagreement with the Melbourne Cricket Club and the MCG Trust regarding the scheduling of finals at the MCG. The key elements were:

• Removing the requirement to play one preliminary final per year at the MCG in the event that two non-Victorian teams earn the right to host a preliminary final in their home states.
• Ensuring all preliminary finals in Victoria are played at the MCG.
• Allowing greater flexibility to bank finals in weeks one and two, with the clause amended to ensure that 10 matches are played over five years.
• Delivering an additional four premiership season games to the MCG each year, taking the number of matches played to 45.
• Delivering 14 Collingwood home and away games to the MCG

References:

• AFL 2005 Annual Report
• AFL and MCC reach agreement

The 2009 Renegotiation

• The licence agreement between the MCC and the AFL being extended by five years, ensuring football and the AFL Grand Final remains at the MCG until at least 2037.
• AFL clubs playing home games at the MCG receiving at least an additional $4.6 million a year – or $100,000 a game – for the next 10 years from MCG revenues. This figure is capped at 46 games and is indexed against CPI.
• The management of Yarra Park has been transferred to the MCG Trust, which in turn has delegated operational management to the MCC, with a key water and landscaping project to secure the future of the trees in the park and preserve existing car parking entitlements
  
• The Victorian Government delivering a capped contribution of $30 million towards a major refurbishment of the AFL Members Reserve in the Great Southern Stand and $6 million towards the water-saving project in Yarra Park.
• The new arrangement for home games at the MCG also includes an attendance incentive arrangement marked at $1.50 per head for attendances between 2.1 million and 2.5 million patrons; $2 per head for attendances between 2.5 million and three million patrons; and $3 per head for attendances in excess of three million patrons. Based on 2008 attendances, this payment would have been an additional $1.2m to the AFL and its clubs.
• The AFL will provide a reasonable endeavours clause to ensure aggregate crowds per annum of 1.5m patrons.
• The AFL will schedule 10 of the 12 best attended home and away matches at the MCG and current finals agreement will remain in place which includes the Grand Final.
• After debt and interest, the new arrangement will see the MCC retain 31.1 per cent of ground revenues relating to football, which covers all running costs, wages, maintenanceand capital works. The remaining 68.9 per cent is distributed to the AFL and its clubs.

MCG Trust Comments

Finally, for the next ten years significantly moremoney will go to Victorian AFL clubs playing home matches at the MCG. This will be at least $4.6 million per year in aggregate, and potentially more depending on attendances.

Financially sound clubs should be more competitive and successful on the field, which should in turn be good for the long term health of Australian Rules football here in its home state of Victoria and for attendances at the MCG.

This agreement was able to be reached because the finances of the MCG were sufficiently strong to allow the MCG to make this investment in its future. That is a testament to the way the ground has been managed by the MCC, despite its $300 million debt obligations still outstanding from the Northern Stand
redevelopment.

- MCG Trust Chairman John Wylie, MCG Trust 2009/10 Annual Report

MCC Comments

The 2009/2010 year was notable for several landmark agreements that will have a positive and sustainable impact on the club, the ground and its many stakeholders for many years ahead. These agreements were elements of the arrangement whereby more money will be paid by the club and the ground to Victorian football clubs using the MCG for home games and whereby the grand final is committed to be held at the MCG until 2037.

The club has agreed to pay an additional $100,000 of MCG income per home game, plus a graduated bonus payment for higher than expected attendances. For the 2009 football season, this resulted in $5.1 million being paid to Victorian clubs, money that previously was unavailable to them.

As part of the agreement, the club has assumed management responsibility for Yarra Park, a major undertaking that includes construction of a sub-surface water recycling facility just north of the MCC members’ Gate 2 entrance. Water is the key to the health of Yarra Park and we will have sufficient resources to service the non-potable needs of Yarra Park plus the MCG and Punt Road Oval.

- MCC Chairman, David Meikeljohn, MCC 2009/10 Annual Report

AFL Comments

The Victorian Government played a significant role in agreement being reached with the Melbourne Cricket Club and MCG Trust. The government also agreed to provide $36 million to upgrade facilities in the AFL members’ reserve in the Great Southern Stand, which will also boost the financial return for tenant clubs.

The new agreements with the MCG and Etihad Stadium were the culmination of more than 12 months’ work, which indicated that some of the Victorian-based clubs’ stadium returns were between $5 million and $7 million less than the returns enjoyed by clubs in other cities.

In Adelaide, Brisbane, Perth and Sydney, AFL clubs received 70 per cent of the revenue generated by stadiums from AFL matches while AFL clubs in Victoria received 30 per cent of such revenue.

The agreements with the MCC and Etihad Stadium will provide an additional $145 million in improved match returns to the tenant clubs during the next 10 years at the MCG and 14 years at Etihad Stadium.

- AFL Chairman Mike Fitzpatrick, AFL 2009 Annual Report

In September, the Melbourne Cricket Club and Victorian Government announced a new agreement for Victorian-based AFL clubs playing at the MCG. AFL clubs playing home games at the MCG will receive a minimum of $100,000 per game, backdated to the start of the 2009 Toyota AFL Premiership Season. The AFL has extended its agreement to play the Grand Final at the MCG until 2037 and will schedule at least 10 of the 12 best attended home and away matches in Melbourne at the MCG.

The Victorian Government will also contribute $30 million towards a major refurbishment of the AFL Members’ Reserve in the Great Southern Stand. The AFL and Melbourne Stadiums Ltd (MSL), the owner of Etihad Stadium, also reached a new agreement that will provide a major financial boost to Victorian
AFL clubs playing home matches at the stadium. MSL has agreed to provide AFL clubs an additional $5.5 million per year from 2010 until the expiration of its lease in March 2025. In return, the AFL has agreed that the minimum number of contracted home and away games scheduled at Etihad Stadium will increase by at least 130 during the term of the lease

- Gillon Mclachlan, Infrastructure Report, AFL 2009 Annual Report

References:

• MCC-AFL Stadium User Agreement 2009
• MCG Trust 2009/10 Annual Report
• MCC 2009/10 Annual Report
• AFL 2009 Annual Report

Ill flesh this out some more when more definitive information comes to light. This deal was a renegotiation of a deal originally signed in 1988 and finding information on the original deal is proving difficult.

 

[The_Wookie]

Made this thread exlusively for the MCG agreement

 

[Kwality]

A read begs the question of how these arrangements benefit anyone bar the Melbourne footy fan. You can argue that is how it should be, but was the issue even considered, e.g how much could the game earn from every second GF outside Melbourne: back up the armoured cars Lindsay !

 

[The_Wookie]

A read begs the question of how these arrangements benefit anyone bar the Melbourne footy fan. You can argue that is how it should be, but was the issue even considered, e.g how much could the game earn from every secong GF outside Melbourne: back up the armoured cars Lindsay !

I think the seeds for that go back to 1981, when the VFL announced that the 1984 Grand Final would be held at VFL Park in the belief they could make more money, and the Victorian Government was offering legislative relief for the league regarding player contracts by providing exemptions from the Trade Practices Act (if they could get federal assistance). The deal included upgrades to the MCG, access to members facilities for VFL members, and its also likely that the negotiations there included the end of the ban to playing football on Sunday, given the VFL played finals on Sunday the following year at the MCG.

In 1983, the VFL said that Waverly would return 3.35 million to the clubs from a Grand FInal where the MCG, if upgraded to 104,000 would return between 2.4 and 2.7 million. However in late 1983, the Government refused to approve either the plans to boost VFL park capacity and amenities or the MCC plans to wavie a 250,000 rental fee, citing public expenditure on the MCG and its then deteriorated state. The Government held a meeting with the league discussing the state of Waverly and other league grounds - something I believe could have also precipitated the move from suburban grounds to the MCG and Waverly in the mid 80s.

For what its worth, then PM Malcom Fraser backed the VFL position.

Seriously how awesome is trove.

More information here and here.

 

[telsor]

A read begs the question of how these arrangements benefit anyone bar the Melbourne footy fan. You can argue that is how it should be, but was the issue even considered, e.g how much could the game earn from every second GF outside Melbourne: back up the armoured cars Lindsay !

Considering the capacity issues and the number of seats that are committed in advance to AFL members, sponsors & clubs, I'm not sure how more money could be made.

There would also be a massive issue with transport...If you think getting 10-15K west Australians to Melbourne is tough, try 30-50K trying to go the other way.

 

[Kwality]

The money would come from the State Government attracting the event & that is more likely NSW than either WA or SA.

From 5 years back
http://www.couriermail.com.au/news/...-final-in-sydney/story-e6freon6-1225792380453

 

[fabulousphil]

Considering the capacity issues and the number of seats that are committed in advance to AFL members, sponsors & clubs, I'm not sure how more money could be made.

There would also be a massive issue with transport...If you think getting 10-15K west Australians to Melbourne is tough, try 30-50K trying to go the other way.

I don't think capacity issues should really be a concern, i have long held the view that if a non Victorian team wins the right to host the GF then it is what it is.

The game should be held in that particular state at the biggest venue available.

I don't think the MCG because of it's bigger capacity should be the sole host of the GF, why don't we just play all the finals at the MCG ?.

 

[telsor]

I don't think capacity issues should really be a concern, i have long held the view that if a non Victorian team wins the right to host the GF then it is what it is.

The game should be held in that particular state at the biggest venue available.

I don't think the MCG because of it's bigger capacity should be the sole host of the GF, why don't we just play all the finals at the MCG ?.

The finals, particularly the grand final are big money spinners for the AFL, and rightly or wrongly, they're not likely to give that up anytime soon.

As for capacity issues....The AFL has certain obligations with respect to letting people in.
AFL members pay what they do with the expectation of a GF seat (well, the longer term ones at least), AFL sponsors packages include seats, all the clubs get an allocation, both for their staff/players/sponsors/coterie and a lot are resold in a standard but fairly lucrative money spinner, etc etc.

Now, the figures the AFL publishes for these have some pretty broad ranges, but those groups alone take up from 22,500-63,000 (told you they were broad ranges), and that's before a single person from the competing clubs fans get in.

Clearly, you wouldn't get that into Metricon for example (and GC people wouldn't be thrilled at 'their' GF being in Brisbane..for that matter, Geelong would argue for using Simmonds...You say same state, they'd say same city should be the criteria). That said, practically every stadium apart from MCG & ANZ will have a fair chance of being sold out before a single member gets a ticket.

Add that to the $$$ lost by the AFL both directly (income lost) and indirectly (worse deal with MCG, need to book all possible grounds in advance) and it'd be a really tough fight to make it happen.

 

[fabulousphil]

The finals, particularly the grand final are big money spinners for the AFL, and rightly or wrongly, they're not likely to give that up anytime soon.

As for capacity issues....The AFL has certain obligations with respect to letting people in.
AFL members pay what they do with the expectation of a GF seat (well, the longer term ones at least), AFL sponsors packages include seats, all the clubs get an allocation, both for their staff/players/sponsors/coterie and a lot are resold in a standard but fairly lucrative money spinner, etc etc.

Now, the figures the AFL publishes for these have some pretty broad ranges, but those groups alone take up from 22,500-63,000 (told you they were broad ranges), and that's before a single person from the competing clubs fans get in.

Clearly, you wouldn't get that into Metricon for example (and GC people wouldn't be thrilled at 'their' GF being in Brisbane..for that matter, Geelong would argue for using Simmonds...You say same state, they'd say same city should be the criteria). That said, practically every stadium apart from MCG & ANZ will have a fair chance of being sold out before a single member gets a ticket.

Add that to the $$$ lost by the AFL both directly (income lost) and indirectly (worse deal with MCG, need to book all possible grounds in advance) and it'd be a really tough fight to make it happen.

I understand enough to know ( and the reasons you have pointed out ) it will probably never happen, but if it ever does happen then obviously people would have to understand that those groups alone take up from 22,500-63,000 will have to change year by year.

Not only is a GF that can be played in any state year in and year out good for the game, it would be good/great for the state and club.

I can also see the POV held by many fans that the MCG is actually the spiritual home of the game and deserves the GF, but MO is, if you deserve/win the game on merit then it should be played on your dunghill as small or as large as it is.

Does the superbowl move around yearly ?.

 

[blueboy25]

I can also see the POV held by many fans that the MCG is actually the spiritual home of the game and deserves the GF, but MO is, if you deserve/win the game on merit then it should be played on your dunghill as small or as large as it is.

Does the superbowl move around yearly ?.

The superbowl is played at a different venue each year.

In relation to holding the GF on your own dunghill if you win on merit. The logistics of holding it will be the big sticking point. The host city would not know if they are hosting until a week before, would need to organise pre game, half time and post game entertainment, GF Parade etc etc.

Also would you really want to watch a Gold Coast v GWS at blacktown stadium if they happen to be the two teams in the GF?

 

[telsor]

I understand enough to know ( and the reasons you have pointed out ) it will probably never happen, but if it ever does happen then obviously people would have to understand that those groups alone take up from 22,500-63,000 will have to change year by year.

The AFL makes commitments at the start of the season to these groups.

I doubt NAB, or Toyota would be thrilled with being told ... Well, you might get 200 seats, you might get 50, or you might get 500 depending on where it's played...

AFL members..lower fees and loses one of it's bit drawing points, access to the GF, so probably fewer members.

MCC will be pissed at losing it's equivalent, and that will affect the ground deal at the MCG (and the Vic state government would also be pissed, so they'd back them).

All together, you're causing the AFL to lose a LOT of money. As I said, right or wrong, that just wont happen.


As for the Superbowl...Their tradition is for it to move, and I dare say there are minimum size/income provisions when grounds apply.

 

[The_Wookie]

The money would come from the State Government attracting the event & that is more likely NSW than either WA or SA.

From 5 years back
http://www.couriermail.com.au/news/...-final-in-sydney/story-e6freon6-1225792380453

And as a result the NRL are paid 10 million annually to host the NRL Grand Final in Sydney. At the MCG, even the MCC pays a fee to the AFL on Grand Final day. (and somehow in 2010 made a loss on the second grand final where the AFL made a huge profit)

 

[fabulousphil]

The superbowl is played at a different venue each year.

In relation to holding the GF on your own dunghill if you win on merit. The logistics of holding it will be the big sticking point. The host city would not know if they are hosting until a week before, would need to organise pre game, half time and post game entertainment, GF Parade etc etc.

Also would you really want to watch a Gold Coast v GWS at blacktown stadium if they happen to be the two teams in the GF?

Sort of agree, sort of don't, those things ( entertainment etc ) can be worked out quickly if needs be, albeit not as good as if planned for a while, however i would be rapt to be watching GWS V GC at Blacktown, because obviously i would not get a ticket, BTW i would imagine that game transferred to ANZ from Spotless.

Anyway it is all just pie in the sky stuff because we all know it won't happen, however in my ideal football world it would.

 

[fabulousphil]

The AFL makes commitments at the start of the season to these groups.

I doubt NAB, or Toyota would be thrilled with being told ... Well, you might get 200 seats, you might get 50, or you might get 500 depending on where it's played...

AFL members..lower fees and loses one of it's bit drawing points, access to the GF, so probably fewer members.

MCC will be pissed at losing it's equivalent, and that will affect the ground deal at the MCG (and the Vic state government would also be pissed, so they'd back them).

All together, you're causing the AFL to lose a LOT of money. As I said, right or wrong, that just wont happen.


As for the Superbowl...Their tradition is for it to move, and I dare say there are minimum size/income provisions when grounds apply.

I did reply above (post 13 ) and that reply would also stand for your post, but i reckon the AFL would find plenty of ways not to lose money if the GF was floating.

 

[Kwality]

The finals, particularly the grand final are big money spinners for the AFL, and rightly or wrongly, they're not likely to give that up anytime soon.

As for capacity issues....The AFL has certain obligations with respect to letting people in.
AFL members pay what they do with the expectation of a GF seat (well, the longer term ones at least), AFL sponsors packages include seats, all the clubs get an allocation, both for their staff/players/sponsors/coterie and a lot are resold in a standard but fairly lucrative money spinner, etc etc.

Now, the figures the AFL publishes for these have some pretty broad ranges, but those groups alone take up from 22,500-63,000 (told you they were broad ranges), and that's before a single person from the competing clubs fans get in.

Clearly, you wouldn't get that into Metricon for example (and GC people wouldn't be thrilled at 'their' GF being in Brisbane..for that matter, Geelong would argue for using Simmonds...You say same state, they'd say same city should be the criteria). That said, practically every stadium apart from MCG & ANZ will have a fair chance of being sold out before a single member gets a ticket.

Add that to the $$$ lost by the AFL both directly (income lost) and indirectly (worse deal with MCG, need to book all possible grounds in advance) and it'd be a really tough fight to make it happen.

We all know there is a deal locked in, Victoria wins because of it, not footy. Cant see these ' behind closed doors' happening again .. the AFL will adopt a level of transparency some time in the future - expect those benefiting to squeal.
The MCC would be high on the list of losers though well behind the Victorian economy.
;
'

 

[Rob]

The AFL makes commitments at the start of the season to these groups.

I doubt NAB, or Toyota would be thrilled with being told ... Well, you might get 200 seats, you might get 50, or you might get 500 depending on where it's played...

AFL members..lower fees and loses one of it's bit drawing points, access to the GF, so probably fewer members.

MCC will be pissed at losing it's equivalent, and that will affect the ground deal at the MCG (and the Vic state government would also be pissed, so they'd back them).

All together, you're causing the AFL to lose a LOT of money. As I said, right or wrong, that just wont happen.

But it's never been contemplated to know either way.

There should be no issue with the AFL coming out and saying when the MCG contract expires then they are open to a new venue if the deal is right. At the very least it should inspire a better deal with the MCG.

Of course that's a fair way into the future anyway. 30 years or so IIRC.

 

[The_Wookie]

But it's never been contemplated to know either way.

There should be no issue with the AFL coming out and saying when the MCG contract expires then they are open to a new venue if the deal is right. At the very least it should inspire a better deal with the MCG.

Of course that's a fair way into the future anyway. 30 years or so IIRC.

No doubt they'll try to play it off against whatever large stadiums exist in 2042. No Waverly to bargain with next time, but a lot of room to move - who knows what the capacity of Adelaide and Burswood will be in 2042.

 

[Rob]

No doubt they'll try to play it off against whatever large stadiums exist in 2042. No Waverly to bargain with next time, but a lot of room to move - who knows what the capacity of Adelaide and Burswood will be in 2042.

But without the carrot of a grand final, there isn't the business case for it.

I've got no doubt the WA government would built an 80k+ capacity ground if the lure of a grand final every few years was there. That's why the AFL should announce their intentions post MCG contract (which is 22 years as I just found out) ASAP.

 

[The_Wookie]

But without the carrot of a grand final, there isn't the business case for it.

I've got no doubt the WA government would built an 80k+ capacity ground if the lure of a grand final every few years was there. That's why the AFL should announce their intentions post MCG contract (which is 22 years as I just found out) ASAP.

yep my mistake there. Was Originall 40 years from 1992, plus a 5 year extension added in 2002 as part of the deal that enabled most finals to be played outside victoria.

 

[telsor]

But without the carrot of a grand final, there isn't the business case for it.

I've got no doubt the WA government would built an 80k+ capacity ground if the lure of a grand final every few years was there. That's why the AFL should announce their intentions post MCG contract (which is 22 years as I just found out) ASAP.

They'd add 20K+ seats for a game they'd get 1 year in 9? (working on phil's principle of 'earning' the game?).

I could see a superbowl style system where the game is moved around, but the location declared at the start of the year (with minimum size/profitability criteria for venues), but even then, I go back to what I said earlier about it being a transport nightmare if it was played somewhere like Perth.

 

[The_Wookie]

They'd add 20K+ seats for a game they'd get 1 year in 9? (working on phil's principle of 'earning' the game?).

I could see a superbowl style system where the game is moved around, but the location declared at the start of the year (with minimum size/profitability criteria for venues), but even then, I go back to what I said earlier about it being a transport nightmare if it was played somewhere like Perth.

Theres really 4 options

1. Maintain the tradition and always hold it at the MCG
2. A bidding system, decided a year in advance (ala the superbowl)
3. Automatically hold it at the venue of the previous winner (ala the Americas cup)
4. Play it by ear and leave it to the final week to decide where the game will be.

 

[telsor]

Theres really 4 options

1. Maintain the tradition and always hold it at the MCG
2. A bidding system, decided a year in advance (ala the superbowl)
3. Automatically hold it at the venue of the previous winner (ala the Americas cup)
4. Play it by ear and leave it to the final week to decide where the game will be.

Pretty much.

Although something else to consider, particularly for options 3 and 4....If/when they add a Tassie team, consider having the GF at a ground that holds 25,000....

 

[theflea]

I don't think capacity issues should really be a concern, i have long held the view that if a non Victorian team wins the right to host the GF then it is what it is.

The game should be held in that particular state at the biggest venue available.

I don't think the MCG because of it's bigger capacity should be the sole host of the GF, why don't we just play all the finals at the MCG ?.

The simple fact if the GF help finance the AFL for each year. If it couldn't do that, then clubs would go broke, as there would be no AFL dividend or assistance.

 

[theflea]

I understand enough to know ( and the reasons you have pointed out ) it will probably never happen, but if it ever does happen then obviously people would have to understand that those groups alone take up from 22,500-63,000 will have to change year by year.

Not only is a GF that can be played in any state year in and year out good for the game, it would be good/great for the state and club.

I can also see the POV held by many fans that the MCG is actually the spiritual home of the game and deserves the GF, but MO is, if you deserve/win the game on merit then it should be played on your dunghill as small or as large as it is.

Does the superbowl move around yearly ?.

The afl would be skint if this was the case. Those AFL seats takers wouldn't commit large sums of money pureply because there wouldn't be much of a return. The AFL would be broke because of it. I understand it is a utopian view, but it is simply not workable, logistics wise or financially either.

 

[blueboy25]

Theres really 4 options

1. Maintain the tradition and always hold it at the MCG
2. A bidding system, decided a year in advance (ala the superbowl)
3. Automatically hold it at the venue of the previous winner (ala the Americas cup)
4. Play it by ear and leave it to the final week to decide where the game will be.

The only problem with 4 would be getting supporters to the venue.

Only have to look back to 2 years ago when the Dockers made the grand final and dockers fans were having to fly to melbourne via singapore as there just aren't the flights available to transport everyone at such short notice.