I’ve got a ton of different posts in the hopper that I’m going to try to pump out in the next few days. This one came about because of Pat LaForge’s comments in the Journal the other day, whining that the Oilers lost a bunch of money last year. There are a million things wrong with his complaints but one of the major factors is that the Oilers do a pretty terrible job as far as spending their money on players goes.
There was a fellow by the name of Doug Pappas who wrote for Baseball Prospectus before he passed away in 2004. He came up with a measure that he called Marginal Payroll/Marginal Wins that he used to measure how efficiently a front office spent its payroll. You should read the entire piece but the key is this:
The easiest way to measure front office efficiency is simply to divide a club’s payroll by its wins to come up with “dollars per win.” However, neither side of this equation reflects reality. The worst team a club can field won’t go 0-162, and despite some owners’ best efforts, it’s impossible to spend $0 on a major league roster. It’s then necessary to look at marginal wins and marginal payroll.
The Marginal Payroll/Marginal Wins (MP/MW) system evaluates the efficiency of a club’s front office by comparing its payroll and record to the performance it could expect to attain by fielding a roster of replacement-level players, all of whom are paid the major league minimum salary. The formula is:
(club payroll - (28 x major league minimum) / ((winning percentage - .300) x 162)
The left side of this formula assumes that a replacement-level club would play .300 ball. That translates to 48.6 wins in a 162-game season, which before the 2003 Tigers was worse than any actual major league club since the institution of the amateur draft. The previous low was the 52-110 (.321) record of the NL’s two 1969 expansion clubs, the Expos and Padres, who began play with no minor league system, no way to sign free agents, and no players any other NL club really wanted to keep. After subtracting the replacement-level .300 winning percentage from the club’s actual winning percentage, the resulting number is multiplied by 162 to calculate the number of marginal wins over a full 162-game season. This adjusts the formula for strike-shortened seasons and clubs which fail to make up a postponed game or two.
I’ve given some thought to adapting this to the NHL. On the basis of my own examination of the history of NHL records, I think that there’s a reasonable argument to be made that a replacement level NHL team would play .250 hockey - 41 points, with another couple of points earned through OTL - call it 45 points. The minimum salary in 2005-06 and 2006-07 was $450K and it bumped up to $475K for the past two seasons; assuming 23 players, that’s a minimum payroll of $10.35MM in 2005-06 and 2006-07 and $10.925MM during the past two seasons.
From there, the calculation is pretty easy. Using the Oilers as an example, they earned 95 points in 2005-06 on a payroll (cap hit) of $35.605MM. That’s 50 marginal points on $25.259MM in marginal spending, or $505,098 per marginal point.
The team totals since the lockout are posted at left. As we all know, the Oilers went on for years before and during the lockout about how they just needed a level playing field in order to compete. The evidence of the past four years does provide particularly compelling support to that argument. As you can see, the Oilers rank 22nd in the NHL during that time, spending nearly $120K more than the NHL average per marginal point in the standings.
Unsurprisingly, the Oilers look considerably worse if you take out 2005-06. There’s some argument in favour of doing that, I think - it was the first year of a new system and Edmonton benefitted from having a bunch of key players already signed to contracts who were then required to take a 24% rollback as well as being on the receiving end of some salary dumps. As mentioned above, they had a M$/MP of $505,098 in 2005-06. They followed this up with a M$/MP of $1.176MM in 2006-07, $902K in 2007-08 and $1.107MM last year.
If you figure that it takes 95 points to assure yourself of a playoff spot, you’ll need to have a M$/MP of $906K to achieve that, assuming a salary cap of $56.8 and that you’ve spent your entire budget. That’s considerably better than the Oilers have managed in any year but the first year following the lockout ($902K M$/MP occurred where a team spending the $50.3MM cap had to have a M$/MP of $799K or better to top 95 points).
I’m inclined to think that this method does tell us something about the calibre of a front office. Of the 13 teams below the NHL average, 11 of them have replaced their GM since the lockout. Only Larry Pleau in St. Louis and Don Waddell in Atlanta have managed to survive with M$/MP below the NHL average. By contrast, only 7 of the 17 teams with M$/MP better than the league average during that time have been replaced.
I’m interested in the thoughts on this as a metric. It’s a bit screwed up because the NHL doesn’t actually permit a team to be more than $8MM below the midpoint. With that said, the list does look to me like a reasonable list of how various front offices have performed. You can, as always, argue about whether it’s circumstance or skill that puts a team high on that list (One way to do well on a list like this is to have a bunch of young, cheap contributors who you draft with high picks: that doesn’t necessarily reflect managerial skill) but I think that most everyone would agree that it generally reflects how the various front offices have performed since the lockout.
I’m not particularly optimistic about the Oilers in the near to mid future and a big part of that is that I just don’t believe that the front office thinks in these terms. I know that Lowe is nominally no longer the GM, but he still seems to have a heck of a lot of influence and even though the guy with the title is new, it’s the same bunch of guys otherwise, minus Scott Howson and plus Rick Olczyck. Whether you think that Khabibulin is elite or not, this team just desperately needs guys to outperform their contracts and I haven’t really seen anyone arguing that Khabibulin will. Part of the reason I’m mildly bullish on the Comrie contract (I’ve got a post coming) is that I think he might outperform his deal.
Other than that, it’s hard to see how the Oilers can drop their M$/MP in the next little while. If Gagner and Cogliano step forward this season, they’re looking at big raises next year. Same goes for Denis Grebeshkov. Smid might be a candidate to provide some cheap value but he’s only signed for one more year. The guys who won’t realistically improve seem to be locked down; the ones who could well take the leap are due to get new pacts immediately thereafter. Realistically, any dreams about the Oilers getting enough out of Gagner and Cogliano to become one of the elite basically requires them to sign two or three year deals after this year and then make another leap. The way in which this team is structured kind of requires threading the needle as far as improving significantly goes.
So, to bring this back to my opening, when I hear Pat LaForge talk about the Oilers losing millions of dollars, one of the questions I’d like to see David Staples ask is whether, as president of the team, LaForge has gone to Darryl Katz and said something along the lines of “Over the past four years, our management has been amongst the worst groups in the league at turning marginal payroll dollars into points in the standings. We should look at identifying someone from a team that does this well and letting him rebuild the front office.” I’m pretty sure that the answer to that question would be no. I’m even more sure that Katz wouldn’t blow out the entire front office. With that said, if Katz is willing to let a bunch of old boys and cronies who aren’t particularly good at spending money efficiently run the show, how is it my problem if I’m a taxpayer in Edmonton? Let the Oilers leave town and have a fellow who wants to run a franchise properly and recognizes a good market when he sees it come in.
I think it would be more interesting to see how the number of playoff rounds (or playoff games, or playoff wins) for a team over that period correlates to this measurement.
You can talk about blowing money all you want, but its not our money, and the fan only cares about success (playoff success to be exact).
I don’t think anyone will argue that the Oilers have been the shining paragon of bargain-basement deals, but I see some teams low on the metric that have had some recent playoff success (and some that look very poised to do it in the future as well).
I think it would be more interesting to see how the number of playoff rounds (or playoff games, or playoff wins) for a team over that period correlates to this measurement.
Add it up. Just eyeballing it, it looks to me like the teams at the top are going to blow away the teams on the bottom.
“Yes, Mr. Laforge, Matt Fenwick here, Battle of Alberta website. While I understand that a business plan based on making the Finals every year isn’t sustainable, can you please elaborate on why anyone should feel bad that you’re not making money when you’ve spent to the cap 3 straight years on a non-playoff team?”
“Seriously, one of a fan’s few hopes in a situation like this — 3 years of capped out rosters for 0 years of playoffs — is that maybe financial issues will force the club to rethink how they’re doing things. Why is it good for Oiler fans if the Oilers make money no matter how lousy they are and how much they spend?”
I also don’t believe they’ve lost any money.
Yeah, I don’t buy that they lost money for a second. I mean, I know there’s some voodoo-ish accounting that can be done to make a profit into a loss pretty quickly and legally, but… If they wanted to be making money, they could be.
And secondly, I’m not at all surprised to see Nashville at the top spot there.
It is meaningless to talk about whether the Oilers made or lost money without stating what the capitalization of the team…i.e. the debt to equity ratio Katz is using for the Oilers…i.e. how much interest cost goes into.
What is important to know is the EBITBA, i.e. whether there were operating earnings, apart from the capital structure.
“The Calgary Flames and the Edmonton Oilers need to be on the same footing. We need to compete with them….
- LaForge
Can someone please explain this comment to me? The only way this makes sense is within the context of “we don’t generate enough revenue to allow us to spend to the cap, so we’re at a competitive disadvantage vis-a-vis Calgary.”
Since this clearly isn’t the case, the comment essentially says that the Katz group doesn’t think its making enough money from the Oilers, so it wants the taxpayers of Edmonton and Alberta to buy them new revenue streams.
I’m not opposed to taxpayers funding a good chunk of this new rink, but I am opposed to the Katz group receiving all the hard benefits (concession money, parking money, incremental revenue from other events held in the building) while leaving taxpayers to enjoy all the warm and fuzzy BS (ie. increased civic pride, a revitalized downtown, greater status on the global urban food chain).
Completely agree with godot10 and mclea. It’s pretty much agreed that Katz overpaid for the team because it’s cool to own a hockey team, right? Why should his hobbies be subsidized?
McLea . . .
In San Diego, the tax increment funding for the building project was guaranteed by the team owner . . .. So the owner guaranteed there would be enough extra development, enough of an increase in taxes from the arena district, to pay the loan on the new building.
the good news about sam gagner is that he isn’t arbitration-eligible, so if the oilers front office has seen what happened with the krejci, brassard, and parise contracts (as well as the kessel and dubinsky non-contracts), they just might get a solid discount on a 4 year deal.
David -
Does that take into account the fact that TIF financing frequently fails to account for the fact that the government would have got a lot of that tax revenue anyway? I suspect not.
Tyler —
I’m exploring this issue around TIFs and CRLs.
I’ve heard a few opinions on this issue, but I haven’t done the research yet to have answers in this regard, and certainly haven’t made up my own mind on whether they create new economic activity or just help one part of a city at the expense of other parts (though if the area being helped is Edmonton’s bleak downtown, that’s something to think about).
Another question David - I don’t know whether it was you or Lamphier who talked to LaForge but when he mentioned that the Oilers lost money last year, did you guys ask him any followup questions on that? It seems to me that this is shaping up to be a “The Oilers need a new rink mostly on the public dime and all of the revenues from it to survive.” If that’s how it’s gonna be, LaForge shouldn’t be allowed to make statements like that without being challenged.
Phenomenal post. Great to see some of the fantastic ideas that come out of Baseball Prospectus be applied to hockey.
Interesting analysis. I think the concept is valid, however as others have mentioned it’s very difficult to draw conclusions without involving playoff games.
If you look at the majority of the top teams in your analysis, I wouldn’t consider them successful because they don’t do well in the playoffs and winning when it counts is the objective, which is clearly missed in this analysis. For example, there is simply no way that you can say Minnesota is a more successful franchise than Washington. Therefore the concept makes no intuitive sense - i.e. it needs tweaking.
Maybe you can include playoff games and give them a heavier weighting than regular season games. Or, toss out the regular season and perform the analysis on playoff games only. I suggest weighting loftier playoff rounds higher than entry level playoff rounds.
Nice work.
though if the area being helped is Edmonton’s bleak downtown, that’s something to think about
Yes, and the concept of the “margin” being applied to hockey statistics in the main entry is useful for thinking about downtown “revitalization” too.
For example, there is simply no way that you can say Minnesota is a more successful franchise than Washington.
I’ve never claimed to measure which franchise is more successful. I’m measuring which franchise gets the most out of its spending. There’s a difference.
You guys who want to include playoff success will have to do your own analysis - I see the playoffs as being largely a crapshoot where being the better team counts, but not fo rmuch.
Mclea,
My understanding of Laforge’s comment is that Calgary controls all the revenues of the Saddle Dome and the Oilers share with Northlands.
Northlands claims that the facility is used 200 nights a year, so that means roughly 75% of the events are non-hockey.
Northlands also states that there are 2 million users per year in the Rexall Place. In my estimation, that’s roughly 1.25 million at non-Oilers events (2 million - 16K x 47 nights). That’s a lot of missed revenue for the Oilers that the Flames don’t have to share.
A fair question to ask is “how many government infrastructure or service” facilities have 2,000,000 users? That gets you some kind of idea on it’s value to the community compared to other items - i.e. the Edmonton Art Gallery at $100 million or say, a road improvement like the $250 million 23rd Avenue overpass.
Don’t forget the Oil Kings also play there.
That’s 77/200 nights occupied by Oilers-brand hockey, before playoffs.
MrOiler,
But Katz knew that when he bought the team, so I don’t understand how that is relevant.
Thanks for finally coming up with a mathematical formula to discern what virtually the entire hockey world (except the Oilers front office) has noticed for the last decade or so — the team’s management is the weakest weakness on a team with many glaring weaknesses.
The prelude says it all — one doesn’t even have to analyze the long division.
1) The Oilers were bad before the lockout, and demanded a change in league’s structure to level the playing field.
2) After the playing field was levelled, the team gets worse and worse and worse.
As Bill Needle said, thank you for this brilliant analysis that finally demonstrates what the entire hockey world (minus Oilers management) has intuitively known for the past ten years. To be certain, I’ve experienced somewhat of a catharsis to see the true problem not only identified, but actually quantified for the first time. Tyler, excellent article!!!
http://www.mc79hockey.com/?p=3207#comment-253276
“In San Diego, the tax increment funding for the building project was guaranteed by the team owner…”
David, was this a guarantee with market terms? Was there an escrow, liens on appropriate assets, bonding, or margin terms? If the deal were to go south, is there an ability to demand margin from the owner? Is the guarantee recourse to all of the owner’s assets, or just the team and facilities (in which case, the guarantee is worth exactly zero).
The specific terms and conditions matter so much, and inevitably the taxpayer gets hosed. After getting plowed and screwed. There are a multitude of smart people willing to make a bitch of the taxpayer, but rarely does someone who does deals actually step in to protect the citizen. Cognitive regulatory capture is almost defined by sports stadiums.
mclea, it’s becoming clear that Katz’s model on acquiring the Oilers is to realize additional revenue by getting the taxpayer to build him a new building. Then flip, I suppose. In the interim, his plan was likely to keep rolling revolving debt, but that’s been hard and expensive for the last year. Anybody who spent 200 bucks for any asset last year probably has a stomach ache about it today… now, it’s about getting out alive.
macndub - why do you think Katz wants to flip? Seems to me that it’s more likely he wanted to build his sports empire and then sit atop it, surrounded by the guys he cheered for in high school and university, watching the Oilers win Stanley Cups.
If that were the case, he would be spending all of his energy building a better team, which, as you point out, is not happening. Not even close. Instead, we have the distraction of a stadium push, which he has to realize will only distract from the on-ice product.
Doesn’t it seem possible that he’s trying to build a better team but really has no idea what he’s doing and suffers from a bit of cronyism? I mean, I keep Dennis kicking around here. It strikes me as entirely reasonable to think that he might just not be particularly good at managing a hockey team or particularly willing to fire a bunch of friends.
Well, I’m probably offside for trying to guess at the motivations of someone I don’t know. And human motivation is, of course, a maelstrom. Let me put it this way: I think something changed over the last year. I think that the team went from a happy dream that could cover its cost of entry into a cash sink. Either the new arena plan is new, and therefore a response to the economic climate (but that makes no sense, because who’d pick a frickin’ depression to build a vanity project), or it was always part of the deal, and therefore a naked revenue grab.
A flip is perhaps a longshot (where would a buyer come from?) but it seems that improving the revenue picture was always part of the plan, and the consideration reflected enhanced revenue opportunities. Always risky.
Hey, you’re dead right about Dennis and I’m glad that I didn’t have to be the one to tell you.
Let me put it this way: I think something changed over the last year. I think that the team went from a happy dream that could cover its cost of entry into a cash sink. Either the new arena plan is new, and therefore a response to the economic climate (but that makes no sense, because who’d pick a frickin’ depression to build a vanity project), or it was always part of the deal, and therefore a naked revenue grab.
I’m not as sure that Katz is that worked up about the cash. I mean, surely he could do the numbers beforehand and figure it all out, no? I also think that the arena plan and improving the revenue picture was always part of the plan - this may well be a real estate deal, like so many NHL team purchases seem to be. That makes sense to me.
Hopefully for us, it goes better for him than it did in Phoenix.
I mean, surely he could do the numbers beforehand and figure it all out, no?
Well, his proforma numbers have probably run through the buzzsaw of our little depression here.
Anyway, we will see if soon if the additional revenue is a nice-to-have, or if it’s absolutely essential. We won’t be Phoenix, though. The good news is that there is utterly nowhere for this team to go, unless they relocate to Prague.
Do you think that the depression has affected the Oilers that badly? As far as I can tell, they sold out all year last year and will do it again this year. Maybe they were cutting prices and I didn’t hear about it, but I don’t get the sense that they’re really feeling the depression.
At the very least, their contracts were locked in last year before the financial crisis. If they were going to take a hit, I’d expect it to occur this year. If, in fact, they did suffer losses last year, I’d be very surprised if they weren’t budgeting for them and if they didn’t occur because Katz took on a ton of debt.
Do you think that the depression has affected the Oilers that badly?
Someone on HF was saying that they were #1050 on the waiting list for season tickets going into this summer, and they ended up having a chance to purchase tickets.
That’s a LOT of turnover in one year.
Granted, the list is at least 1400-1500 people long, but still.
Turning over the waiting list does not impact the bottom-line until the waiting list runs out and seats are left empty. No buying a ticket is the only way to keep these guys honest and not have them turn the franchise into the Leafs.
Doesn’t the league publicise the equalisation structure - at least the donors and the recipients? I suspect the Oilers are a donor franchise - tough to maintain that they are losing money while providing corporate welfare to Bettmanland teams.
Wirtz ran the Hawks into the ground rather than pay into equalisation.
This thread is getting stale, but I just want to respond to Tyler’s question, because it is important.
Consider a high fixed cost business. Revenues are $100, costs are $90, and assume all costs are fixed, and we live in a GOP paradise with no income taxes. Cash flow, then is $10. Now, suppose that this business is for sale, and purchased for $200. The purchase is financed in 2008 with $200 of debt at 5% for one year, interest only terms, and you assume that it will roll in 2009 and forever. So far, you’re doing great: there is none of your precious cash in the deal, and the team operationally breaks even. Yeah, bad things could happen, but any shortfalls could probably be financed with additional debt. The G5 is not under any threat at all.
Now Lehman explodes, the debt comes up for renewal, and the bank has a conversation with you. In fact, because of the recession, revenue is not $100: it’s only $97. An almost immaterial difference, but NON-INTEREST COSTS MAKE UP 90% OF YOUR REVENUE AND THOSE COSTS ARE FIXED. Uh oh. Now, cash flow is only $7 instead of $10 projected, and less than the interest payment. And the bank is thinking about refinancing your rolling loan at 7% instead of 5%, and only for $150 million rather than $200 million. And you have to record a lien against the G5.
So, you see that a 3% revenue drop can push you into functional bankruptcy, or a situation where you have to come up with $50 million in equity posthaste. This is the nature of a balance sheet recession, Irving Fisher debt deleveraging process, and/or a small-d depression.
I’m not suggesting that Katz is in trouble: far from it. I’d give a lot to have a Gulfstream that I can sign over to the bank. But without seeing into the management books (and I don’t mean the financial or even the tax filings: I mean the nitty gritty of every transaction in the business), it’s impossible to determine what the real financial impact of even a small revenue drop is. Now, it’s unlikely in a real business that fixed costs amount to 90% of revenue, but the nature of the bulled-up aughts was that any free cash flow would be channelled into interest payments to minimize equity infusions. In plain English, profit is simply a mechanism to inject higher leverage. And it’s all going very badly right now.
While the Oilers’ gate is likely unchanged or even higher (as Deano points out), advertising, apparel, concession, and even parking will probably take a hit. And there’s only so many girlfriends and mistresses to fire before you start cutting into things that matter.
The solution? A new revenue stream (building), but paid for by someone else (the taxpayer). If I were on the other side of the table with Katz, though, I’m not even talking to him unless he lets me into his office with a team from KPMG. But I’ve often been criticized for not being a team player.
I don’t know what kind of industry you work in macdub, but I don’t know of any $200M deals being 100% leveraged with short term debt. Mainly because there isn’t a financial institution on earth that would structure a deal that ridiculous. So although your scenario is interesting, I don’t think it’s anywhere close to being realistic.
Even if Katz had some short term debt that he had to turn over, there was about a 10 month window where he might have gotten somewhat squeezed. But as of today, he’s probably getting a better short term rate than when he got in.
I don’t think Katz has a cash flow problem. I don’t think he has an income problem. What I think he has is a “I want to generate more revenue, but I don’t want to have to finance the purchase of new assets” problem. And his solution is for Albertan’s to buy him a new rink.
mclea’s 35 makes some sense to me, in terms of the hypothetical deal sound like a weird structure. I don’t know enough about how things get financed though to do anything more than fake it. Two points I’ll respond to:
The solution? A new revenue stream (building), but paid for by someone else (the taxpayer). If I were on the other side of the table with Katz, though, I’m not even talking to him unless he lets me into his office with a team from KPMG.
Mayors and other elected officials are known for their willingness to do this, right? Right? (Again, doesn’t bother me because I don’t pay taxes in Alberta or Edmonton, but I think that the taxpayers will take it on the chin here.)
I don’t think Katz has a cash flow problem. I don’t think he has an income problem. What I think he has is a “I want to generate more revenue, but I don’t want to have to finance the purchase of new assets” problem. And his solution is for Albertan’s to buy him a new rink.
This I completely agree with. I think he bought the Oilers for the same reason George Mallory climbed Mount Everest and that this isn’t quite the same thing as the EIG losing some money.
I don’t know what kind of industry you work in macdub, but I don’t know of any $200M deals being 100% leveraged with short term debt.
My example was illustrative, but not far off.
How about a $5.4 billion deal with 80% leverage and short term debt? The interest could only have been paid if rents increased 25%.
http://cityroom.blogs.nytimes.com/2009/09/10/when-a-real-estate-deal-goes-bad/
Or a $1 billion deal for a gas producer (a bit of revenue volatility) at >80% leverage?
http://www.financialpost.com/news-sectors/story.html?id=1975362
Or a $390 million deal with no equity that I could find? http://www.scribd.com/doc/15447269/Yellowstone-Mountian-Club-Interim-Order-
(The membership deposits for this club were refundable, so do not count as equity. The principals had no skin in the game. The 90% LTV is based on a market value calculation, not the actual equity injection).
I worked on a project financing for >80% leverage, with levered equity that brought implied leverage >90%. It was common.
That’s all great Macdub, but in your example Katz had to roll over his debt every year. So you find me a deal where somebody borrowed $5.4B billion for a real estate project on a one year term, and I’ll concede defeat. Otherwise your example is still ridiculous.
Highly leveraged deals are common. Highly leveraged deals of that scale on one year terms don’t exist, unless it’s some sort of bridge loan.
Here you go, mclea. You can’t even imagine how angry this deal makes me, since I’m a U.S. taxpayer and pay for this shit.
http://nymag.com/daily/intel/2008/02/harry_macklowe_takes_it_on_the.html
Just about a year ago, real-estate mogul Harry Macklowe borrowed $5.8 billion from Deutsche Bank to buy seven office buildings in New York City while putting up just $50 million of his own cash. That debt would have come due today, but last week Macklowe made a tentative agreement to turn control of the buildings back over to the bank, since the current credit crunch has made it impossible for him to refinance the debt.
MacKlowe’s debt was called because he was in default on the loan:
http://www.bloomberg.com/apps/news?sid=abO3tea1H_oQ&pid=20601087
Regardless, this is a stupid and pointless exercise, so I think we should just end it. However, there are a couple factors that make me pretty certain that Katz isn’t even close to being fully leveraged:
- Given the league’s emphasis on franchise stability, I’d be very surprised if they didn’t have some provision that necessitated that every new owner put in a minimum % of equity in every new purchase. I’d bet my first born that something like this exists, because its clearly not in the league’s interest to have teams blow up because their revenue went down 5%.
- NHL teams, unless they own their barn, don’t have any significant tangible assets they can borrow against, which would limit the amount of debt they could take on. Admittedly the new CBA addressed this issue somewhat indirectly by making future cash flows less risky, and therefore easier to borrow against, but it’s not like Katz has a bunch of hard assets (within the Oilers business) to pledge as collateral.
I really don’t think Katz is having any issues right now. My best guess is that the financing for the purchase of the Oilers was fairly conservative, and allowed for the totally predictable small fluctuations in year to year revenues.
His problem is that if he wants to significantly increase his revenues, the only way he can do it is by getting a new arena, which will come with all the inherent risks of an asset with huge up front costs and benefits that accrue over several decades. And I don’t blame him for not being terribly enthusiastic about taken on that new risk, especially when private financing for a project of that scale has really dried up. But he knew all this when he bought the hockey team, so I’m not terribly sympathetic. It’s not like the economics of professional sports franchise ownership have changed drastically since be purchased the team.