To Flyer: Please Clarify The Stadium Funding

Green Dozer · November 24, 2008

Again, I don't know why this myth is still out there. Anyone who says we have to raise $30 million+ before we even break ground is just plain wrong.

Since Dr. B does not post here, maybe you can clarify what you mean as there is a poster in Houston who thought the BOR was going to "approve the stadium". I think translation is what is confusing everybody.

So you are saying there does not have to be $30 million dollars in the bank, right? Maybe that is where the miscommunication is. But, the President and BOR will want to know where it is coming from, which goes without saying, but is that correct.?

I would think the stadium will not start without one (depending on which it is) or all of the following:

1) Bonds for financing 2) Corporate Sponsorship 3) Donations 4) Study from other sources of revenue for the stadium.

Is the above correct? Thank you for your time.

Edited November 24, 2008 by Green Dozer

untbowler · November 25, 2008

Dozer there is already a thread that UNTFlyer made in fact it was 2 below this thread, a simple search does wonders rather than cluttering the board up with numerous threads of same topic.

Bascially the Athletic Fee goes straight to the Legislature and is now handled by the UNT Legislative Affairs Division and the money produced can be used to start the stadium process.

stebo · November 25, 2008

I am also very puzzled as to why everyone is all of the sudden "puzzled"... Dr B was very clear, she would not sign off on a new stadium until at least half the funding was in place. This was before the student vote. It was the entire REASON for the student vote. It was her most aggresive stance against building any type of stadium without a student fee in place. No stadium (or athletic facility) is ever 100% funded before you break ground, if that was the case - nobody would ever build anything. Even if the Athletic Department doesn't get a single larg ticket donation, they can retire the debt the same way that they did with the Athletic Center loans. In fact, they will have a much easier path to retiring the debt now that they have an actual DEDICATED athletic fee to run the program with. Will a lot of this fee go to the stadium? Yes, but some of it will go to day to day operations and scholarships that had to be subsidized by donations in the past. It is really silly, it is like taking out of the left pocket and putting into the right - but that is exactly how this thing will get paid for. The stadium is a done deal, it was a done deal the day that the "yes" beat the "no"...

For those of you that cannot wrap your minds around it - just look at The Athletic Center. It was like $9.7 million to build (going off of memory, could have been $7.9).. We had a million dollar donation and then a few other smaller ones but for the most part, it was paid for with loans. Those loans were paid back by the Athletic Department (and they were paid off 3 years earlier than expected). The money came from lots of things - body bag games, donations, merchandising, season ticket sales, Mean Green Club donation, other medium donations... etc etc. The stadium (I imagine) will be built the same way. Instead of loans, it will be bonds. The fact that the Athletic Department has already shown their ability to retire debt is a HUGE plus... I don't think that people give RV the credit that he deserves because he actually helped the department build a credit line throughout this LONG process. Bad coaching hire? Sure - but he sure as hell made this stadium happen with the help of hard working students like Flyer. Many would have thought that it would have been impossible but we will break ground after the State approves this, like it or not.

UNT90 · November 25, 2008

SOB hasn't washed my car in two weeks

Green Dozer · November 25, 2008

SOB hasn't washed my car in two weeks

To you and Tasty, I am not trying to make fun or try to make anybody look stupid.....a poster had the question after Flyer's thread. I was simply trying to help, but as I said to Bowler, I will think twice about it next time. Glad you guys got such a good laugh.

UNT90 · November 25, 2008

To you and Tasty, I am not trying to make fun or try to make anybody look stupid.....a poster had the question after Flyer's thread. I was simply trying to help, but as I said to Bowler, I will think twice about it next time. Glad you guys got such a good laugh.

Dude, ease up. It's only humor, and not aimed at you. Seems like everyone has relied on Flyer for a lot of things.

If it makes you feel better, you can make fun of me for double posting a topic.

Green Dozer · November 25, 2008

Dude, ease up. It's only humor, and not aimed at you. Seems like everyone has relied on Flyer for a lot of things.
If it makes you feel better, you can make fun of me for double posting a topic.

OK, thanks, it's all good. Understand and no prob!

Green Dozer · November 25, 2008

Dozer there is already a thread that UNTFlyer made in fact it was 2 below this thread, a simple search does wonders rather than cluttering the board up with numerous threads of same topic.
Bascially the Athletic Fee goes straight to the Legislature and is now handled by the UNT Legislative Affairs Division and the money produced can be used to start the stadium process.

Duh!

I was trying to clear up a couple of things for a couple of other posters, as they posted my question after Flyer. And oh, thank you so much for letting me know about the "simple search" feature. That will make my future time here so much more pleasant. Also, I want to apologize to all the Pygmies in New Guinea for cluttering up the board with my multiple thread. I understand that it jammed up the internet and you were not able to get your order through for the food drop tomorrow. I will be sending a small donation to hopefully make up for some of your loss, money that could go to the stadium here. And Bowler, again, thank you for you pointing out all of this, and for your information on how the fee goes through the legislature. I wish you had been my state government teacher in high school.

Edited November 25, 2008 by Green Dozer

UNT90 · November 25, 2008

Don't let him do it. Still repairing the roof damage from his visit this past weekend. He's got no sense of balance.

UNTflyer · November 25, 2008

Good stuff.

To answer the question, Dozer... and this is how I understand the process to be so don't spread it as gospel...

Since we now have a guaranteed source of revenue with the athletic fee, we have the money needed for the BOR and Dr. B to approve construction of the stadium.

What I do worry about is how the project will be FINANCED. Someone has to pay the almost $70 million to the contractors for the actual construction, and that means a bank needs to provide a loan.

Edited November 25, 2008 by UNTflyer

Huff · November 25, 2008

Flyer has certainly been on the nose with his information BUT if I am on the Board of Regents I would say "we now know where half of the money is coming from but before I obligate the university to pay seventy million dollars I want to know where the rest of the money will come from" and if I am a financial institution that is going to issue bonds I am going to ask the same question. I know that might be overly cautious but in today's financial climate I think people are going to be very cautious about obligating the university to pay back a huge amount of money or lending the university that same amount. My guess is that any ground breaking for a new stadium is farther away than any of us would like.

drex · November 25, 2008

Huff is probably right. One thing I know is that if I was still out there at athletics and the students voted half the cost of the stadium I would be spitting out donation brochures and would have a phone bank calling for donations. They just don't seem to be in any hurry to get this thing really rolling ( as in creating excitement and momentum ). In defense of the athletic department, it may be that the higher ups have dictated that the effort for outside donations must be in tandem with other university fund raising thrusts. If that is the case, the stadium will appear the twelfth of never.

stebo · November 25, 2008

Guys, we have a guaranteed stream of revenue - it is called the athletic department. They have already shown that they are willing and able to retire debt with the Athletic Center. The state law simply states that student fees cannot pay for more than 50%. Realistically, we raised about $3 million in donations for the AC - so the rest of the debt was paid down from the Athletic Department over 3 years. Let's lowball the AC as a $9 million dollar project - 6 million paid off over 3 years, about $2 million a year. Even if the Department was conservative and only retired $2 million/year - they would take care of the other $30 million in 15 years. That is with zero sponsors which we all know will happen as soon as a concrete structure is being built. This isn't rocket science.

mad dog · November 25, 2008

Ok... I'm looking at a statement of revenues for North Texas here.

If we are assume:

1) The cost of the stadium including make ready and finish out is approximately $70 million.

2) The athletics department currently shows $4.9 million per year in football and non-dedicated revenue once the current student fee is backed out.

3) The stadium is on a 15 year bond schedule.

Then it stands to reason that the financing plan might shake out like this:

$70 million over 15 years = $4.6 million per year. Football and non-dedicated revenue (the above $4.9 million) is used to fund the annual debt service, while the athletics fee is used to backfill the void left in operations. In essence, the "stadium" referendum does not actually fund the stadium directly. Instead, it allows for a freeing up of traditional revenue to pay for the stadium. This means that we don't NEED a dime from anyone, because we can pay for the thing ourselves. Anything we get from alumni or corporate sponsors is simply icing on the cake.

Again, I'm not close to the process, it just represents another take on the situation from an interested party. I might be completely wrong.

trud1966 · November 25, 2008

Ok... I'm looking at a statement of revenues for North Texas here.
If we are assume:
1) The cost of the stadium including make ready and finish out is approximately $70 million.
2) The athletics department currently shows $4.9 million per year in football and non-dedicated revenue once the current student fee is backed out.
3) The stadium is on a 15 year bond schedule.
Then it stands to reason that the financing plan might shake out like this:
$70 million over 15 years = $4.6 million per year. Football and non-dedicated revenue (the above $4.9 million) is used to fund the annual debt service, while the athletics fee is used to backfill the void left in operations. In essence, the "stadium" referendum does not actually fund the stadium directly. Instead, it allows for a freeing up of traditional revenue to pay for the stadium. This means that we don't NEED a dime from anyone, because we can pay for the thing ourselves. Anything we get from alumni or corporate sponsors is simply icing on the cake.
Again, I'm not close to the process, it just represents another take on the situation from an interested party. I might be completely wrong.

That's the way I've always thought of it. To me, and this may be a simpleton's point of view, but it's like UNT has the money, they're using the student money to pay back a loan from themselves...if that makes any sense... :blink:

Green Dozer · November 25, 2008

Guys, we have a guaranteed stream of revenue - it is called the athletic department. They have already shown that they are willing and able to retire debt with the Athletic Center. The state law simply states that student fees cannot pay for more than 50%. Realistically, we raised about $3 million in donations for the AC - so the rest of the debt was paid down from the Athletic Department over 3 years. Let's lowball the AC as a $9 million dollar project - 6 million paid off over 3 years, about $2 million a year. Even if the Department was conservative and only retired $2 million/year - they would take care of the other $30 million in 15 years. That is with zero sponsors which we all know will happen as soon as a concrete structure is being built. This isn't rocket science.

Stebo,

Was there not some type of funds that the Board of Regents came up with to get the athletic center paid off? Don't know the whole story, but this has been mentioned to me that the University paid this thing off, and not with the athletic department's money. Just asking for clarification or if you have any knowledge. FYI, your post is very clear. Thanks!

Edited November 25, 2008 by Green Dozer

houstonmeangreen · November 25, 2008

Ok... I'm looking at a statement of revenues for North Texas here.
If we are assume:
1) The cost of the stadium including make ready and finish out is approximately $70 million.
2) The athletics department currently shows $4.9 million per year in football and non-dedicated revenue once the current student fee is backed out.
3) The stadium is on a 15 year bond schedule.
Then it stands to reason that the financing plan might shake out like this:
$70 million over 15 years = $4.6 million per year. Football and non-dedicated revenue (the above $4.9 million) is used to fund the annual debt service, while the athletics fee is used to backfill the void left in operations. In essence, the "stadium" referendum does not actually fund the stadium directly. Instead, it allows for a freeing up of traditional revenue to pay for the stadium. This means that we don't NEED a dime from anyone, because we can pay for the thing ourselves. Anything we get from alumni or corporate sponsors is simply icing on the cake.
Again, I'm not close to the process, it just represents another take on the situation from an interested party. I might be completely wrong.

I was told prior to the vote, by those in charge....you know...that we were just waiting on the vote, that there was money on the sidelines for the stadium (large donations....Mattress Mack? Goldfield?, etc) waiting for the results of this vote. Perhaps that is why the general fans have not been asked for donations yet...My guess is they will start a campaign for general (smaller) donations once they get approval or start breaking gound....also, if you remember, they recent got approval to increase their commercial paper limit to 100 million from 50 million. Also, this RFP for the hotel....this goes with the stadium project somewhat and they are suppose to pick a contractor/proposal in Jan 09....start date unsure.....I know there is not much clarity on all of this, but there isjust too much going on for this stadium not to happen....and as far as bonds go, I think university (revenue?) bonds in Texas are considered very safe...even today....but I'm no bond expert.

Again, perhaps RV should let us know a little about what is going on.

stebo · November 25, 2008

Stebo,
Was there not some type of funds that the Board of Regents came up with to get the athletic center paid off? Don't know the whole story, but this has been mentioned to me that the University paid this thing off, and not with the athletic department's money. Just asking for clarification or if you have any knowledge. FYI, your post is very clear. Thanks!

You bet, those are the loans that I was referring to. The Athletic Department initially took a $1 million dollar loan and then added another $2.6 million onto it - then I think that there was a shortfall on the building costs so they borrowed even more. So I don't know what the total amount came to, allt hat I know is that they had a "mortgage burning" party before Homecoming this year and basically burned the note - because it had been paid off... and 3 years ahead of schedule on top of that.

It really is kind of silly - Illuvious summed it up better than me - we just needed the student vote to guarantee half of it, more for commitment than anything. Hypothetically we could have bonded out the whole thing with enough pressure. But we have the student's fees now, of which the $10 per credit hour is a $7 per credit hour increase over our previous student fee revenue. The $3 bucks an hour used before will be replaced with $5 bucks an hour so that we can have a higher athletic budget and the other $5 bucks an hour will go to facilities (stadium to start and 15 years down the road, whatever they want). I would also like to point out that this fee can be increased by up to 10% every year WITHOUT a student vote. So if the fee goes into place in 2011 at $10 bucks, it can go to $11 bucks in 2012, $12.10 in 2013, and so on and so on - until it gets to the state maximum which is like $20 bucks a credit hour. I expect the administration to raise this fee by 10% every single year so that we can fund this program the way that it SHOULD be. In three years, just off the increases alone we will have back that original $3 bucks an hour that the student service fee was giving us, and we will be able to retire THIS debt well ahead of schedule. Plus we will be able to buy out lousy coaches if they do not produce.

This fee was such a huge thing for NT and athletics, I really don't think that people know the magnitude of it. The stadium is just the tip of the iceberg.

TIgreen01 · November 25, 2008

You bet, those are the loans that I was referring to. The Athletic Department initially took a $1 million dollar loan and then added another $2.6 million onto it - then I think that there was a shortfall on the building costs so they borrowed even more. So I don't know what the total amount came to, allt hat I know is that they had a "mortgage burning" party before Homecoming this year and basically burned the note - because it had been paid off... and 3 years ahead of schedule on top of that.
It really is kind of silly - Illuvious summed it up better than me - we just needed the student vote to guarantee half of it, more for commitment than anything. Hypothetically we could have bonded out the whole thing with enough pressure. But we have the student's fees now, of which the $10 per credit hour is a $7 per credit hour increase over our previous student fee revenue. The $3 bucks an hour used before will be replaced with $5 bucks an hour so that we can have a higher athletic budget and the other $5 bucks an hour will go to facilities (stadium to start and 15 years down the road, whatever they want). I would also like to point out that this fee can be increased by up to 10% every year WITHOUT a student vote. So if the fee goes into place in 2011 at $10 bucks, it can go to $11 bucks in 2012, $12.10 in 2013, and so on and so on - until it gets to the state maximum which is like $20 bucks a credit hour. I expect the administration to raise this fee by 10% every single year so that we can fund this program the way that it SHOULD be. In three years, just off the increases alone we will have back that original $3 bucks an hour that the student service fee was giving us, and we will be able to retire THIS debt well ahead of schedule. Plus we will be able to buy out lousy coaches if they do not produce.
This fee was such a huge thing for NT and athletics, I really don't think that people know the magnitude of it. The stadium is just the tip of the iceberg.

Any chance the fee gets us out of one more bodybag game per year??

Green Dozer · November 25, 2008

Any chance the fee gets us out of one more bodybag game per year??

I would sure hope so, it it doesn't at least do that, then we did not ask for enough.

stebo · November 25, 2008

Stebo,
The $7 increase is somewhat misleading, which throws off your math a bit. The $3 per hour built into the Student Service fee was the only part dedicated to go to athletics. The actual amount that goes to athletics is quite a bit more already. So there isn't an actual tangible $7 an hour increase. I don't have an actual estimate of what it works out to, but I would imagine it is probably already in the $5 - $6 range. The increase is real and significant, but it isn't quite as large as you are hoping.

You are correct - the amount that the athletic department could normally pull out of the student service fee was allotted at $3.00 of the pot... this last year, they got a little over $5.00 per hour from that fee. Why did they get more? I am guessing it was requested by RV to retire the debt of the Athletic Center so that we could have that note burning right before the vote (smart politics in my opinion) and we might have still been paying out Dickey's contract. The $3.00 is what was set aside by the SGA and BOR directly towards Title IX compliance after the first vote failed. There are always exceptions to the rule and this last year was one of those. In the future, the amount will not be flexible because it will be a dedicated athletics fee and that $3 bucks has been taken off of the student service fee.

I don't know how many times the department has gotten more than the $3/hour like they did in 2007-2008... Maybe it was a normal thing... not sure about that. What I am sure about is that we are in really great shape for funding the program in the future once the fee takes place so that is even MORE reason to get the stadium built (because the fee does not go into effect until the stadium is done)..

I hope that I am getting all this right, it is what I understand to be true from talking to the entities at NT and also through reading this board. Financing for this would not be done with a loan like the AC - it will need to be bonded out. As long as there is a guarantee for retiring the debt, the bonds should not be a problem... of course, we need the Texas Legislature to go along with all this but with a resounding student vote - I can't see any reason why they would deny NT students the right to "tax themselves.