Gary James said:
I think the key aspect which people often choose to ignore is that moving to the stadium cost City somewhere in the region of about £50-£60m in truth. Maine Rd was valued at about £30m & then the fit out (which included basics like dressing rooms that had to be in place) at £20-£30m. As the Kippax Stand cost between £10-£15m depending on who you listen to then that overall cost was significant.
Of course City got a great deal, but so did all the stadium funders.
I could go on for hours about this but ultimately the stadium was not free.
Sorry, Gary, but the value of Maine Road is a total red herring. I think it was actually valued at GBP 27 million in the Commonwealth Games deal, which is the value it had in City's books at the time. If David Conn actually wanted to criticise the stadium deal, this is what he should focus on.
The GBP 27 million book value of Maine Road was more than once referred to as laughably excessive by the partner of a Manchester accountancy firm who used to review City's annual accounts in King of the Kippax under the name 'Stan the Man' (you probably know who he is, and he used to write under a different guise in BTH). I took care to memorise one of Stan's quotes, and this experienced accountancy professional called such a balance sheet valuation of Maine Road "the most dubious accounting valuation I have come across".
In theory, it was based on the value of Maine Road as a sports ground, but that was a strictly notional concept, because in the real world no one else wanted the land for that use. This was proven when the Council tried to find a new tenant after City left. Stockport County and Sale RU came forward, but neither was ever seriously likely to take a tenancy, the former because the stadium wasn't in Stockport, and the latter because their middle class supporter demographic was horrified by the prospect of having to venture into Moss Side to watch home games.
So in any meaningful sense, the value of Maine Road was simply its site value. This was put at GBP 4 million in the early 1990s, but will obviously have risen between then and City leaving the ground in 2003. I've never seen a reported figure for the Council's proceeds when the site was disposed of, and I suspect that even a Freedom of Information Act request for details would be unsuccessful: they'd surely invoke section 43(2) and argue that disclosure would "prejudice commercial interests".
However, the best clue, we have, comes from a 2005 Sport England board meeting, minutes of which can be accessed here:
https://docs.google.com/viewer?a=v&...0WSv-c&sig=AHIEtbQeebu5omumi99c27zjL-9f15ehdA. Note in particular the following:
As a result of the legacy and the sale of Maine Road, approximately £8 million would be returned to Sport England over a period of time.
In other words, Sport England committed GBP 77 million to the funding of the stadium and the Council committed over GBP 30 million on the basis that Manchester City Council would then acquire title to Maine Road, an asset worth GBP 27 million. The best possible guess from information in the public domain is that the asset in question actually realised GBP 8 million.
I would argue that the principle of using public money to build a stadium was sound. Sport England had set aside a contingency for a temporary Commonwealth Games stadium that would have been dismantled after 2002. In making its GBP 77 million grant for the permanent stadium that City eventually occupied, Sport England took into account the following factors, which were also seen as crucial by the Council:
(a) the temporary stadium option would have significantly damaged the prestige of the 2002 Games , whereas in fact they were a great success and even generated a surplus out of which the small athletics facility was funded;
(b) that option would have left no Games legacy capable of drawing visitors to East Manchester after 2002;
(c) British Athletics had no wish to relocate to a permanent home in Manchester, so a national athletics stadium was not viable;
(d) a smaller athletics stadium, but one still capable of holding major events, would have detracted from the existing and still relatively new facility at Don Valley, Sheffield, so also could not be justified;
(e) there was no other viable long-term permanent tenant than Manchester City;
(f) only by finding a credible tenant for a significant stadium could Sportcity be branded as a significant sporting centre of excellence: without a permanent stadium in the vicinity, most of the other sports facilities on campus would not have been built – after all, who would otherwise have wanted to come to a desolate post-industrial site in East Manchester for tennis or squash facilities;
(g) City committed to make the stadium available for community use on a considerable number of days per year – offhand, I think this was 100, but I’d have to check;
(h) City agreed to pay rent out of gate receipts which would subsequently be ring-fenced for the Council to use on sports;
(i) City taking the land ensured that there was no risk for the Council in terms of ongoing maintenance costs (remember, when the plan for the 2012 Olympic Stadium was to scale it back to a 25K athletics only venue, estimated annual running costs amounted to several million pounds);
(j) creating a landmark concentration of sports facilities centred round a major stadium offered a better prospect than anything else on the table of stimulating interest in developing the swathes of derelict land in the vicinity; and
(k) the stadium we ended up with can be criticised for certain things, but ultimately its cost of GBP 112 million represented remarkable value for money when set against the cost of similar facilities.
That list, in my opinion, contains several good reasons as to why it was perfectly reasonable to undertake the construction of the City of Manchester Stadium (as it then was), commit significant public funds to it and award a tenancy to MCFC. However, we shouldn’t be overly defensive about criticism of the deal.
I really think it’s disingenuous to argue that the cost of the Kippax Stand at Maine Road should be regarded as part of the cost of City moving. If you spend money on repairing your car, then trade it in for another one a couple of years later, then in my opinion you wouldn’t regard what you paid for repairs as part of the cost of the new car. I fail to see why City’s case is fundamentally any different.
Moreover, I’d note that City had eight years of use of the new Kippax Stand. Even if you are going to embrace the logical gymnastics necessary to treat it as part of the cost to MCFC of CoMS, you need to deduct both gate receipts attributable to the 1.5 million plus spectators who watched league games from that stand between 1995 and 2003, and revenues from the corporate facilities in that stand (match day and non-match day).
Finally, the cost of the Kippax was taken into account in the value placed on Maine Road in the stadium deal. To add it to other costs of moving is, in effect, to count it twice – having your cake and eating it, in other words.
And nor should we make too much the fact that we had to pay for the dressing rooms and one or two other essential items, in my opinion. As far as I’ve always understood, the overwhelming cost of the fit out went on corporate and spectator facilities from which City alone take the revenues. I suspect, but am not in a position to substantiate, that the move wasn’t well handled and costs were allowed to escalate unnecessarily in certain cases. However, whether or not that’s true, we can hardly claim in the circumstances that it was unreasonable for us to have to foot the bill for the fit out.
I’m afraid that, whatever people on here want to believe, the truth is that City did get extraordinarily lucky with the stadium deal. And we weren’t just fortunate that our Council wanted a legacy stadium from the Commonwealth Games and needed us as a tenant to make it happen. The deal involved us giving up an asset valued for those purposes at GBP 27 million when it was almost certainly worth substantially less – in all probability, somewhere approaching GBP 20 million less. To labour the point, a potential GBP 20 million was lost to the public purse because the actual value of the asset MCFC contributed was substantially less than its value in the deal with the Council and Sport England.
It was also fortunate that this wasn’t presented to the public in those terms at the time. What would have happened had this made the papers, of course, remains a matter of conjecture, but it isn’t an enormous stretch to wonder whether or not the Council would have had the appetite to do the deal on the same terms if those terms had penetrated the public consciousness to a greater degree.
I understand that City fans are sensitive to criticism, especially after we’ve had so much ill-informed stick over the last four years. However, I don’t see that it can be helpful to blind ourselves to the reality of the terms on which we moved to CoMS. If observers, including our own fans such as David Conn, want to question the way the move was engineered, then it’s their prerogative to do so. It’s perfectly legitimate to ask whether the club should have been required to make a greater contribution to CoMS than it actually did.
Nevertheless, I don’t think we should be embarrassed about this. If the MCFC hadn’t agreed to move to Sportcity, that land would at best now be home only to a small athletics stadium a la mini-CoMS. At worst, it would be just a big patch of derelict land. Sport England and the Council knew exactly what they were doing, and the whole deal was driven by a spirit of creating a partnership between MCFC and the Council to help to push regeneration in an extremely deprived area of Manchester. This, remember, is an area that is blighted spectacularly by the collapse of its former industrial base, decimating the population and creating a whole welter of social problems in its wake. As a result, MCFC were given terms that would make the move attractive to the club.
And what’s worth noting is that the vision I’ve set out in the last paragraph is exactly the vision that was sold to ADUG when they decided to buy MCFC and not one of the other clubs who’d shown up on their radar when they formed an intention to buy into English football. After false starts in terms of further development that ranged from the possibility of building a Test cricket venue on the north car parks to the whole failed Super Casino affair, the next decade will see a realisation of the vision that the Council and MCFC, with the help of Sport England, started to develop back in the mid and late 1990s.
In fact, the pay off will be much more dramatic than they or we could have imagined back then. It will involve MCFC, via its current owners giving back to the city of Manchester far, far more than whatever extra any reasonable person could have expected us to pay towards the original stadium costs.
Now, people can look on from the sidelines and talk about New East Manchester not meeting targets for regeneration in the last ten or fifteen years. However, if such people go on to question the legitimacy of building CoMS, then they should be asked what they would have done differently. How would they have ensured that the land which became Sportcity for the 2002 Games didn’t then revert back to being empty, barren waste ground, consigning with it the best hopes for East Manchester’s next generation?
If they can’t answer, their comments are merely the vapid, pointless and unhelpful fripperies of the inveterate handwringer. In that case, we shouldn’t become defensive and start to manipulate the truth or try to cloud the issue with irrelevancies. We should just laugh at them: they deserve no better.
