Tuesday, July 19, 2011

Updated Numbers, Criticisms, and a Big Retraction (Al Gore Weeps)


Hey everyone, a few things to go over, and the post frequency is going way up through the referendum date (as you'll see).

EDIT 7/20/11 1:30 PM: Apparently we misunderstood yesterday.  The Office of Legislative and Budget Review released its report, but it's different from the Maragos report, which will supposedly come out tomorrow.  Correction made.

Retraction and Sincere Apology

After re-reading the referendum language, I need to retract the part about the lockbox, because it is apparently not created under the referendum.  I apologize deeply for this misunderstanding, and in the meantime I want to re-iterate my call that there should be a lockbox.  Assuming the referendum passes, there will probably need to be some changes in the agreement to get it through, and I hope this is one of those changes.

Somewhere, Al Gore is crying..and continuing his fruitless quest for Manbearpig.  I'm super, duper serial.

(Blogger's Note: If you didn't get that, I promise I'm just referencing something.  I haven't gone insane....at least not in that way)

Introducing Dave

Dave, known as DP'sknee(andhipandflubugandotherknee) on Lighthouse Hockey, is joining as another writer.  He has a ton of great insight and viscerally gets all the factors going into this.  He'll probably post something tomorrow, but until then you should follow him on Twitter for his fantastic tweets.

2 Anti-Areener Reports

Recently, 2 different groups have publicly released their reports questioning the areener plan, making Wet Hot Areener Summer a little wetter and hotter in the process.  

First, NIFA, which is ratcheting up its criticism of the referendum (despite not reviewing all details so far), released a report available online detailing its concerns with the process.  They will continue to be a tough nut to crack moving forward.

Second, the Association for a Better Long Island continues to embarrass itself and prove what a misnomer its name is.  An independent consultant released a barely-intelligible report criticizing the referendum, but that didn't stop News 12 from breathlessly reporting it as proof that the areener deal is a bad one for taxpayers.  Seriously, stop reading this post and go read that report....It would be funny if someone wasn't paid hundreds of dollars an hour to write it.

Met a No Voter Yesterday

Yesterday, at the post office, I encountered my first No voter.  He was one of the postal workers, and I happened to walk in there to mail a package while they were arguing.  The one postal worker couldn't believe it, and kept saying there was nothing not to like about the project.  The other one parroted the same lines we've heard for decades, so much that we could practically record them in advance.

"Let Wang pay for it!" (Yea, he wanted to....Kate Murray murdered that plan.  It's either that or this; can't have it both ways)

"There will be cost overruns!" (Wang is contractually obligated to pay those)

"TRAFFIC!" (Can someone please explain to me how replacing an arena with another arena creates gobs of new traffic?  Anyone?  Anyone?  Bueller?)

I had an interesting back and forth with the guy, and I hope he didn't send my package to Timbuktu as punishment, but this is what we're up against.  No voters are out there, and they refuse to let logic or facts interfere with things they know to be true, dammit!  As I've said from day 1, it's dangerous to take this for granted.

What's Truly At Stake

While NIFER was registering its objections to the areener (stick tap to Dave on that one - BRILLIANT), and Desmond Ryan was making himself look like a fool (though the medier is trying desperately to make him sound like a dispassionate and concerned citizen - don't fall for it), 2 other reports have come out showing what's truly at stake here.

First, Camoin Associates completed its assessment of the Coliseum referendum for the county (not Charles Wang, or some guy named Wong that the ABLI report cites) on the economic impact of the Islanders potentially leaving Nassau County.  According to this report, $243.4 MILLION A YEAR and 2,660 JOBS would disappear from the local economy.  

Second, Nassau County's Office of Legislative and Budget Review completed its report (which News 12 immediately distorted and Newsday has so far ignored).  This report claims that 74% of borrowing costs will be covered by projected revenues, leading to a maximum tax exposure (if nothing else is done) of $13.80 per household per year.

These numbers illustrate the danger in not truly understanding what's at stake and not having goals aligned.  For instance, ABLI, NIFER, and the media have breathlessly claimed the borrowing is $800 million, not $400 million, but this isn't true.  As I've pointed out in previous posts, there is a concept in finance called Time Value of Money, because money does not intrinsically hold the same value in perpetuity.  If I offered you $100 now or $100 in a year, you'd take it now, because $100 in a year has a present value of less than $100.

In the same vein, yes, the debt service is scheduled at $26 million a year, for 30 years, which in pure numbers totals $780 million.  However, due to interest rates and the time period, that cost in current dollars is lower....actually, around $400 million, the initial cost of the borrowing.  Let's not allow voters to be scared about this.

In addition, the recent saber-rattling from NIFER makes me concerned that their interests are not necessarily in line with the county as a whole.  As we know, NIFER is meant to guard the county's finances, so it must take those into consideration rather than pure economics.  It's possible that NIFER could be doing its job too narrowly and simply considering the costs of borrowing without considering the cost of losing the arena and the team to the economy at large.  This tension might become a flash point if the referendum passes, and I genuinely hope we can do something to stop it.

We have to fight the misinformation, including NIFER's scare-tactics over "Arenaco LLC" (a company set up by Charles Wang to manage the areener).  We can't get caught in nonsense like the fact that Charles Wang would be free to sell the Islanders after 2 years in the new building - the man is pushing 70, and as the owner he has the right to sell his asset when he decides he wants to sell!

At the end of the day, people are faced with a choice:

Do I want to provide a catalyst for restoring the can-do mentality to Long Island and hopefully leading to more good decisions?

OR

Would I rather have that 26 cents a week?

Honestly, abuse of the take-a-penny/leave-a-penny tray could cover that!  Our future is worth an investment.

Bottom Line

The areener process had its worst week since the roll-out back in May, and I wouldn't blame you for wondering if the media was suddenly out to kill the referendum.  However, as I've said from day 1, we have the power to fix this.

We can educate our neighbors (those willing to hear it, of course).

We can get out and vote.

We can get all our neighbors and friends who are yes votes to join us.

That's all we can do - we have to keep pushing back.

We're 13 days out now, let's leave it all on the ice.

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11 comments:

  1. Bravo, Nick. I don't recall if you believe there is a "conspiracy" of some sort through DolansDay and News 12 to bury the Islanders and this project. (just as they did the Lighthouse)
    I personally believe that there is and it's disgusting that no one is really showcasing the FACTS to the public because the reality of it is that people actually READ that RAG.(no pun intended) The other day in DolansDay, they had the opposition on the COVER, yet they buried the FOR story, ohhh, i don't know, 15 pages in. And, as you mentioned, News 12 seems to be really taking every opportunity to tell Nassau County that this will raise taxes yet they always neglect to mention what the cost would be to those taxpayers should the Isles leave.

    For me, too much of a coincidence.
    For the record, OBVIOUSLY voting YES on August 1st and bringing 3-5 additional votes with me.


    -Big Van Vader

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  2. Patrick aka sign guyJuly 20, 2011 at 8:14 AM

    I truly believe this is all about Power,Money and Politics. The real issue at hand is simply investing in the future of Nassau County and the benefits voting yes will have. Most people seem to be stuck on one issue alone, taxes. Try going in to NYC and see what that will cost you!! As always nice job Nick

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  3. I feel that there is a "Dolansday" conspiracy as well. Many ex-Rangers are on board with this project but their boss (from the appearances here) is not. Between NIFA sounding very Kate Murraylike on the project and Newsay and News 12 being sure to highlight the negative.

    Like you said, this vote is everything except assured and as we get closet to 8/1/11 I am sure that NIFA and the Dems will do their best to kill the project and thereby kill the Island.

    --Islanderbill

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  4. Patrick - absolutely right. This could very well mean a small tax increase if revenues and other development fall short, but it depends on whether voters want to make an investment in Nassau County. I would hate to see how much they would have to raise taxes to make up for the loss of the arena and Islanders...it would probably make the $13.80, or even the $58, look like peanuts.

    Islanderbill/BVV - at the end of the day I don't even think it matters whether there is a conspiracy or there isn't....because the end result of lazy, one-sided media coverage is the same. Regardless of the reason, a problem exists and we need to be out there correcting it.

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  5. Its about time you came out with your thoughts, Nick!

    But how can we battle against Ragsday???

    We dont have the wherewithal to counter that...If anything Wanger should be doing that but he has a contract with MSG so he has to play nice w Dolan...

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  6. Another great piece nick. NIFA, ABLI, News12, and newsday can eat shit. The misinformation and lies by those 4 cancers is disgusting.

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  7. Anthony C - I think my new co-blogger Dave put it best on that ABLI report:

    "It reads like he dictated it over a bad cell phone. While drunk."

    IP - We can "battle" by getting our message out there and talking to people as best we can. This weekend I'm declaring my plans for election day as well as a few other ideas. At the end of the day all that matters is that we get the yes voters to the polls.

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  8. Now that the true cost is out at a max of $13.80 a year - that has to almost be a wash when compared to the inevitable tax increase due to the loss of sales tax and other income the county would receive off of the 243 million a year in revenue.

    So its actually - vote yes and you get a new arena and your taxes go up a maximum of $14 a year. Or vote no and your taxes still go up, probably at least that much or maybe even more than that.

    The "NO" people are just stupid, sorry.

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  9. The cost will be $13.80 a year only if Nassau uses the money to pay down the property taxes...Its up to Mangano...If he came out and committed to doing so it would be a huge plus...

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  10. IP is right...goes back to my earlier point that there has to be a lockbox.

    If the referendum passes, I'm sure the democrats will hold out for something in order to give Ed his supermajority, and I suspect a lockbox might be on the table then. I hope so - because it's the best option for tax relief.

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  11. Now I understand what you mean about a lock box... You're ahead of the curve, Nick!

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