Blues to off-load PP to the AFL

Silvagnis

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Thread starter #1
Great idea if this plan goes ahead, the AFL take over the management of the ground and contribute to the rebuilding of the ground.

But what's the catch?

http://www.realfooty.theage.com.au/realfooty/articles/2006/03/02/1141191791166.html
Blues set to off-load ground to AFL. By Jake Niall. March 3, 2006

Carlton will seek a radical financial rescue package from the AFL that involves the league assuming control of Princes Park, effectively selling the club's lease on the ground.

Under the plan, which has been discussed at board level, the Blues will ask the AFL to take over the lease of their home base and contribute to the proposed multimillion-dollar redevelopment of Princes Park.

In effect, the AFL would save Carlton the massive cost of maintaining its ground - an estimated $1.5 million - where the Blues no longer play home games. Carlton would remain the principal tenant, but its financial pressures would be greatly alleviated if the AFL paid for the ground's upkeep, while also assisting the State Government and Melbourne City Council in building an elite training and community facility with a swimming pool and gymnasium.

By using the redevelopment and lease sale as a means of improving the club's bottom line, Carlton would not be required to seek emergency funding from the AFL's annual special distribution, which supports the Bulldogs ($1.7 million this year), Kangaroos ($1.4 million) and Melbourne ($1 million). Some club insiders are reluctant to pursue that more straightforward option and prefer the more lateral lease arrangement.

It is unclear whether the Blues also will seek a cash payment in return for relinquishing control of the ground but in the event that they did receive a significant upfront fee, this would enable them to reduce their debt (estimated at $6 million) and boost their greatest financial weakness: cash flow.

The AFL would be able to use the ground for other purposes, including pre-season and practice matches or as a headquarters for the umpires or other parties - right now, it is used as a base for National Rugby League team, Melbourne Storm. With a lease that runs until 2035, taking over the ground might also give the AFL some leverage in its dealings with Telstra Dome and the Melbourne Cricket Club, given that the Dome is about to be sold and the AFL won't take possession for two decades or so.

The imminent merging of the Carlton Social Club with the football club is a key to Carlton's plan because the social club holds the lease and the AFL has indicated it wishes to negotiate only with the football club.

The social club is expected to announce a significant loss, of up to $1 million, next week and its debts are effectively guaranteed by the Carlton Football Club, which will make a small profit.

While Carlton chief executive Michael Malouf confirmed that the club was pursuing AFL funds for the redevelopment through the league's "facilities development reserve" - the fund designed to improve club facilities - but would not comment on whether the club planned to transfer the ground's lease to the AFL. "I'm not prepared to comment on that . . . That's not something the board's been through. I'm just saying there's no decision in that regard.

"We haven't even met with the AFL on these matters yet." Malouf said the redevelopment project was "in train" with the AFL. "They're putting that strategy before the various governments."

One of the three candidates seeking to challenge incumbents at Carlton's election has made the redevelopment of Princes Park his main election platform and expressed "concern" about the direction of the club.

Marcus Clarke, a barrister and social club board member has nominated for a board position, along with businessmen and coterie members Greg Lee and Craig Hart. Clarke said he was not on a ticket with either Lee or Hart and was a supporter of Stephen Kernahan, who is one of the three directors facing the members (John Valmormida and Chris Pavlou are others).

"I think he should be supported. I'm opposing the other two," said Clarke, who said he was "concerned about certain aspects" of the club's direction, but would not elaborate.

Carlton last night was yet to confirm whether the nominations of Clarke, Lee and Hart had been accepted and complied with the club's articles. Hart has been seconded by Carlton's No. 1 ticketholder, Vivienne Kerr, widow of club powerbroker Laurie Kerr.
 

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#2
What I don't get is why is the board so reluctant to take money from the CBF? What are the strings attached to getting this cash? Is it just pride or does it mean basically handing over control to the AFL (if this is the case then I can totally understand with the way Demetriou runs the show)?

So this article says the loss is $1 million. Didn't Caro "report" $2.5 million. Is it possible she got the facts wrong?:cool:
 

murphster

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#3
Napolean said:
What I don't get is why is the board so reluctant to take money from the CBF? What are the strings attached to getting this cash? Is it just pride or does it mean basically handing over control to the AFL (if this is the case then I can totally understand with the way Demetriou runs the show)?

So this article says the loss is $1 million. Didn't Caro "report" $2.5 million. Is it possible she got the facts wrong?:cool:
What i want to know is why we didn't do this deal when we were negotiating to move to Telstra Dome, at least at that stage we had a stronger bargaining position and would of been a better chance to get a larger cash settlement from the AFL maybe even enough to wipe out our 6 million in debt. This is another case where Collins should excuse himself from negotiations, the AFL would be using the lease on Princess Park as leverage against Telstra Dome which would put Collins in a conflict of interest position being involved with the Dome.
Caro always gets the facts wrong thats why she works for The Age.
:D If we can put this deal together as well as getting rid of the Social Club we could be in the position to start making big profits from next year, as from what they said the Football Club has made a small profit this year already, with a large cash settlement to wipe out the debt we will be back baby.

Now all we need is a big sponsor, i can't understand why ******** Pratt doesn't convince his board to get Visy to be our major sponsor or better yet old ******** has got enough money himself we could be the ******** Pratt Blues playing at ******** Stadium then instead of copping it in the ass we could be the one giving the dicking so to speak.:thumbsu:
 

bmaurizio

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#4
Yep we were in a stronger negotiating position prior to the move, murphstar you're right.
We are at our lowest ebb, financially speaking and all over the place, however a dynamic and creative board would get us the best deal, our debt wiped clean and perhaps a little extra understanding from AFL later on in the year.
This is a chance to apply initiative, question is do we have a board and president with the vision and energy?
Ciao
:thumbsu:
 

SurreyBlue

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#5
Some great and interesting points raised here gentleman.

Napolean, CBF = AFL run club in every sense of the word. We go anywhere near it and we are f***ed, and I am not exagerating.

Murphster, hit nail on the head with one swell swoop. Wonder why we didn't go down this road earlier? Sorry but Collo has never excused himself from any decision. Bloody annoying that no-one listened back then.:mad:
 

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#6
Correct me if I'm wrong, but if we get financial assistance from the AFL aren't we then expected to only pay out the minimum salary cap (92.5%???)??? The theory behind that being that if you need cash from the AFL you shouldn't be outlaying any more of your own cash than you need to. That's my understanding and would be why we aren't too keen on heading down that track.

It may be that I'm wrong, it's been known to happen, but that's how I thought it worked.
 

XXX KINGS

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#9
I can see an issue in say 20 years time, when a financially stable Carlton want to redevelop or upgrade their training facilities yet find themselves unable to do so as they don't have the rights to the land. The last thing we want to be doing as a club is handing over more power to the AFL. At least with the Competitive Balance Fund we can pull out when we feel it necessary. I don't see the negative stigma attached to it like others do. In my opinion if we need the money, we should take it, simple as that.

I admit to not being fully in the know on this topic and that above is just my opinion. If people can see any errors within it, it would be much appreciated if they are pointed out as I want to learn more about this subject.:)
 
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#11
Have heard conflicting reports on what exactly the details are of taking money from the CBF. Ranging from "total control given over to the AFL" to the only requirement being that we simply have to give them a business plan that they approve. Can anyone actually specify the conditions that come with taking this cash?

I just want to know the facts instead of interpretations of how they will affect the club.
 

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#12
Napolean said:
Have heard conflicting reports on what exactly the details are of taking money from the CBF. Ranging from "total control given over to the AFL" to the only requirement being that we simply have to give them a business plan that they approve. Can anyone actually specify the conditions that come with taking this cash?

I just want to know the facts instead of interpretations of how they will affect the club.
The "total control" myth is the hysterical response as there are no longer predetermined conditions a club must satisfy to receive special assistance. All a club has to do is show why they need it how it will help them get out of the poo (a business plan).

Actually, if Carlton are to apply for special assistance then their timing couldn't be better - the AFL recently made it easier for clubs to apply for it. Sydney for instance are to be subsidised this year to the tune of $600K to cover the cost of living allowance they can pay under their salary cap (without the need to supply business plans and the like). There's no longer requirements such as paying 92.5% of the cap that limits a teams competitiveness either. If you can show you need it to make you competitive then you can get it.

Other than the stigma attached and the negative PR it can generate (which may impact on sponsors) there's really no reason not to apply if it's needed. However, I think there's other options like the Princes Park lease back idea that may put the club in a better financial position going forward quicker than debt reduction via annual AFL special assistance payments. Also, there is scope for the AFL and the commission to grant draft assistance if a club can prove they need it. If the Blues were to have a disastrous season onfield I would be applying to the AFL for draft assistance as I think they'd be receptive to the idea since they know full well making Carlton competitive again would solve a lot of these financial problems.
 
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JeffDunne said:
Also, there is scope for the AFL and the commission to grant draft assistance if a club can prove they need it. If the Blues were to have a disastrous season onfield I would be applying to the AFL for draft assistance as I think they'd be receptive to the idea since they know full well making Carlton competitive again would solve a lot of these financial problems.
Draft assistance is attractive but how would it work? Extra picks anywhere in the draft would have to be agreed upon by the other 15 clubs I guess and some who were down even longer than us would fight it IMO. We would have to be at death's door, basically winless with little hope of victory and even then some other struggling clubs would be suggesting we relocate or merge or fold because the pressure is then taken off them.

I know Brisbane and Sydney can get extra zoned players but as we no longer have a zone, would this assistance simply be a matter of having an extra 2-4 rookies or would it be something more substantial?

Anything substantial at all and then we have to ward off the popular asterisk opinions next to any success we eventually have. There is no easy answer. I guess we go survival first and then success second, which to me suggests our survival is no way threatened at present or we would be doing all of this now.
 

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#14
The Old Dark Navy's said:
Draft assistance is attractive but how would it work? Extra picks anywhere in the draft would have to be agreed upon by the other 15 clubs I guess and some who were down even longer than us would fight it IMO. We would have to be at death's door, basically winless with little hope of victory and even then some other struggling clubs would be suggesting we relocate or merge or fold because the pressure is then taken off them.
The Commission have the power to grant additional draft picks. They can do so without the support of any clubs if they so choose. But the reality is that clubs can place pressure as happened when Sydney were asking for a priority pick. There would be resistance but I think there's a solid argument that Carlton need equity assistance in their playing list more so than financial assistance.

The whole point IMO of providing assistance is to as quickly as possible put a club in a position to compete. While financial assistance might keep the doors open, Carlton themselves could generate the amounts needed and more with a competitive team.

If Carlton have a year similar to last year, the club will have finished last or near to 4 out of 5 years. The changes made last season to the priority pick rule were designed to specifically help teams in that situation rather than teams that have one bad season. If they win 4 games or less in 2006 is it fair that Carlton miss out on a pick because of a draw in 2005 when the club would clearly need them? I think the commission would be receptive to the argument.

I know Brisbane and Sydney can get extra zoned players but as we no longer have a zone, would this assistance simply be a matter of having an extra 2-4 rookies or would it be something more substantial?
The AFL could award you an additional first round pick if they choose to. The commission essentially reserve the right to make it up as they go along (if you hadn't noticed).

Zoning IMO wouldn't provide the sort of assistance Carlton need as they need an injection of proven talent that early picks afford you.

Anything substantial at all and then we have to ward off the popular asterisk opinions next to any success we eventually have. There is no easy answer. I guess we go survival first and then success second, which to me suggests our survival is no way threatened at present or we would be doing all of this now.
I think the asterisk argument is becoming a little flawed as the vast majority of teams have had assistance in one form or another. Brisbane, Port and Sydney have all received assistance, and even Essendon 2000 was built on the back of some dodgy salary cap management. It's almost impossible to avoid the asterisks argument these days and there's probably less stigma to priority picks than there is with CBF type payments.
 

HBF

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#15
JeffDunne said:
The "total control" myth is the hysterical response as there are no longer predetermined conditions a club must satisfy to receive special assistance. All a club has to do is show why they need it how it will help them get out of the poo (a business plan).

Actually, if Carlton are to apply for special assistance then their timing couldn't be better - the AFL recently made it easier for clubs to apply for it. Sydney for instance are to be subsidised this year to the tune of $600K to cover the cost of living allowance they can pay under their salary cap (without the need to supply business plans and the like). There's no longer requirements such as paying 92.5% of the cap that limits a teams competitiveness either. If you can show you need it to make you competitive then you can get it.

Other than the stigma attached and the negative PR it can generate (which may impact on sponsors) there's really no reason not to apply if it's needed. However, I think there's other options like the Princes Park lease back idea that may put the club in a better financial position going forward quicker than debt reduction via annual AFL special assistance payments. Also, there is scope for the AFL and the commission to grant draft assistance if a club can prove they need it. If the Blues were to have a disastrous season onfield I would be applying to the AFL for draft assistance as I think they'd be receptive to the idea since they know full well making Carlton competitive again would solve a lot of these financial problems.
I actually didn't realise that clubs could receive draft assistance. How long has the Commission been able to do this?

Would that be ironic if the Commission did grant us Draft Assisstance after the AFL stripped us of those picks a few years back.
 

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#16
JeffDunne said:
The Commission have the power to grant additional draft picks. They can do so without the support of any clubs if they so choose. But the reality is that clubs can place pressure as happened when Sydney were asking for a priority pick. There would be resistance but I think there's a solid argument that Carlton need equity assistance in their playing list more so than financial assistance.

The whole point IMO of providing assistance is to as quickly as possible put a club in a position to compete. While financial assistance might keep the doors open, Carlton themselves could generate the amounts needed and more with a competitive team.

If Carlton have a year similar to last year, the club will have finished last or near to 4 out of 5 years. The changes made last season to the priority pick rule were designed to specifically help teams in that situation rather than teams that have one bad season. If they win 4 games or less in 2006 is it fair that Carlton miss out on a pick because of a draw in 2005 when the club would clearly need them? I think the commission would be receptive to the argument.


The AFL could award you an additional first round pick if they choose to. The commission essentially reserve the right to make it up as they go along (if you hadn't noticed).

Zoning IMO wouldn't provide the sort of assistance Carlton need as they need an injection of proven talent that early picks afford you.


I think the asterisk argument is becoming a little flawed as the vast majority of teams have had assistance in one form or another. Brisbane, Port and Sydney have all received assistance, and even Essendon 2000 was built on the back of some dodgy salary cap management. It's almost impossible to avoid the asterisks argument these days and there's probably less stigma to priority picks than there is with CBF type payments.

This is an intelligent suggestion and would give us a lift up from the mess we are in.
Reasserting the Blues on and off the field would be beneficial for whole competition.
The draconian penalties of Black Friday were inappropriate and unreasonable.
They wanted a scapegoat but got more then they bargained for. Another dismal year for the Blues and a bigger headache for AFL.
Draft assistance would be appropriate and not unreasonable in the form of the picks 1&2.
The 2 additional premierships points in 2005 would not be a valid and strong reason to not help us become a more competitive unit.
Ciao
 
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