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Seat Licenses Proposed For New Falcons Stadium


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From: The Atlanta Journal-Constitution

Atlanta Falcons fans may be asked to help pay for a proposed new downtown stadium through personal seat licenses that can cost thousands of dollars, based on a document obtained by The Atlanta Journal-Constitution.

The document — the most recent draft of a non-binding term sheet that is being negotiated between the Falcons and the Georgia World Congress Center Authority — provides the first acknowledgement that a sale of seat rights is being contemplated as part of the funding plan for the stadium.

Personal seat licenses commonly have been used in the financing of NFL stadiums over the past 15 years. In such programs, fans typically are asked to pay one-time fees for the right to subsequently buy season tickets in a specific seat for the life of the building or a defined number of years.

The Falcons-GWCCA term sheet, described by both parties as a work in progress and obtained by the AJC under Georgia’s Open Records Act, states that the GWCCA “will pursue a ‘seats rights’ campaign to help fund construction” and that the Falcons would be “the sole and exclusive sales representative for these seat rights.”

The Falcons would have “the right to determine the exact terms of such seat rights program, including price, term, etc.,” according to the document. The GWCCA would have “final approval rights over the marketing and sales program plan and forms of agreements to be utilized in connection with such seat rights.”

The Falcons and the GWCCA, the state agency that operates the Georgia Dome, have been in negotiations for 20 months about a possible new stadium, which would be built on GWCCA property near the Dome and cost around $1 billion.

Under the deal being negotiated, an estimated $300 million or less would come from bonds to be repaid by hotel-motel tax revenue and the rest of the cost – minus whatever is raised from seat licenses – would be the responsibility of the Falcons and the NFL.

The state Legislature in 2010 authorized an extension of Atlanta’s hotel-motel tax through 2050 as a partial funding mechanism for a new stadium.

If a deal is reached between the GWCCA and the Falcons, additional governmental action would be required before the project could proceed. The city of Atlanta and Fulton County would have to pass resolutions authorizing the hotel-motel tax extension, and the GWCCA would need approval from the Legislature to increase its borrowing capacity.

The Falcons declined a request for an interview about personal seat licenses, saying “no decisions regarding seat rights have been made.”

The 25-page term sheet “sets forth certain of the material terms and provisions necessary” for the stadium project, according to its opening paragraph, but does not constitute a binding commitment on any point. The protracted negotiations have been fluid.

In response to questions from the AJC about the seat-rights issue, GWCCA spokeswoman Jennifer LeMaster said by email that “these questions will be addressed in detail as part of the [memorandum of understanding].” The Falcons and GWCCA hope to complete the term sheet this month and negotiate a more definitive MOU by year’s end.

“The term sheet only identifies the concept and does not indicate a specific position on each of the items listed,” LeMaster said.

The term sheet states that “all net proceeds from the sale of seat rights” would be included in the GWCCA contribution toward the construction cost after the Falcons are reimbursed for sales and marketing expenses. Seat-license programs at some other stadiums around the country have been set up through governmental entitities, such as the GWCCA, for tax reasons.

A number of questions that fans would want answered about a possible seat-license program are not addressed in the current draft of the term sheet: Would all seats require them? If not, what percentage? And what would be the price range?

Some Falcons fans have expressed concern about expected increases in the cost of attending games since stadium talks heated up earlier this year. An AJC examination of the three NFL stadiums built in the past five years, published in May, showed that ticket prices jumped by an average of 26 percent in the season the stadiums opened and that many fans paid thousands of dollars more in seat license fees.

A study prepared for the GWCCA by consultant Barrett Sports Group estimated that seat licenses in a new Atlanta stadium potentially could generate $100 million to $200 million.

The study estimated that the New York Giants brought in $371 million, the New York Jets $293 million and the Dallas Cowboys $500 million from seat licenses in stadiums that opened since 2008.

The Giants’ and Jets’ seat licenses were priced from $1,000 to $25,000 per seat, depending on location, and the Dallas Cowboys’ from $2,000 to $150,000, according to the study.

Seat rights currently are being sold for a new San Francisco 49ers stadium in Santa Clara, Calif.

Sixteen NFL teams have sold some form of seat licenses. Some teams have required them on all seats, while others have limited them to prime seats. Teams typically offer short-term installment plans or longer-term financing on the fees. No Atlanta pro sports franchise has sold seat licenses.

The Falcons hope to move into a new retractable-roof stadium in 2017. Under the proposed deal described in the current and previously reported drafts of the term sheet, the GWCCA would own the stadium and license control of it and its revenue streams for 30 years to the Falcons, who would be responsible for operating expenses and construction cost overruns.

A few major issues – such as the amount of annual rent the Falcons would pay to the GWCCA and whether the stadium would be located ½ mile north or just south of the Georgia Dome — are still characterized as “open” in the latest draft of the term sheet.

Sixteen NFL teams have sold personal seat licenses in some form, including the three teams that occupy the league’s two newest stadiums. The New York Giants and New York Jets share a $1.7 billion stadium that opened in 2010, and the Dallas Cowboys’ new home opened in 2009. How PSL sales figured into paying for those stadiums:

Team PSL seats Low price High price Gross revenue

Giants 82,500 $1,000 $20,000 $371 million

Jets 55,500 $2,500 $25,000 $293 million

Cowboys 55,000 $2,000 $150,000 $500 million

Source: Study prepared for GWCC Authority by Barrett Sports Group

The state legislature in 2010 approved an extended local hotel-motel tax to assist in funding a new downtown stadium. Since then, staff writers Tim Tucker and Leon Stafford have stayed out front on the story as the Falcons and the Georgia World Congress Center work toward a deal on how the stadium is managed and how the remainder of the nearly $1 billion project will be raised

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It wouldn't bother me as much as most people if they included the rights to EVERYTHING at the new stadium. All concerts, the SEC Championship, the Chick-Fil-A Bowl, the Super Bowl and the BCS Championship...

I don't think that any stadiums offer that type of arrangement. It would add much more $$$ to the cost if they did.

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Pfffttttt....what a joke.

Difference between the three teams they listed and the Falcons. Every one of them have a least one Lombardi, and two of them have multiple Lombardis. I was a season ticket holder for 17 years until work moved me to Seattle last year. If I was still a STH when PSLs went not place, that would be the day I ended my STH membership. PSLs rip off the fans worse than paying full price for preseason games. You want me to pay for the right to turn around and buy tickets? Not going to happen.

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Personally I think they are floating the idea, it was "leaked" by the city or the Falcons of both to gauge public opinion. Think it's all part of negotiations City says how about PSL to defray some costs Falcons say its not a popular option but dont take our word leak we are thinking about it and find out. Seriously doubt the Falcons have a strong enough base to pull off PSL unless it's in a heavily modified form in this current economic climate.

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Guest Fibonacci/Mashburn

maybe it is just me....but I would do it.

again maybe it is just me. but I wouldn't mind helping out......BUTTTTTTT I would want the fans to have a percentage rights just like Green bay does.

I know green bay even has fans who work for free to clean the stadium...I would do that in a heart beat.

also the only reason new stadiums in the last five years have gone up 25% is because of the cowboys.......those girls are nuts (150,000$$$$ I mean really)

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In such programs, fans typically are asked to pay one-time fees for the right to subsequently buy season tickets in a specific seat for the life of the building or a defined number of years.

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If this is the case then I wouldn't be that hesitant to pay $1K or so if it's for the life of my tickets..or 10-15 years. We already get notices about certain events at the Dome...but as a SEAT holder...maybe tickets for SEC Champ, Peach Bowl, NCAA Sweet 16/Final Four...those would be nice to have 1st dibs on as well.

Edited by wartownfalcon
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Guest Fibonacci/Mashburn

I can't imagine that would go over too well in Atlanta. The good news I suppose is that there will always be plenty of season tickets available.

says the guy who only cares about playoffs.

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says the guy who only cares about playoffs.

My status is kind of a non issue. I was a season ticket holder for 7 years from 2001 to 2007, but the Falcons kept jacking the prices up every single year. Since I live 600 miles away and can't make it to but to one or two games a year, it became a bad investment.

The point I was making is...if I want to go to a game, I usually don't have a problem finding tickets pretty cheap, unless it is a really really big game.

That kind of situation isn't usually conducive to personal seat licenses.

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If this is the case then I wouldn't be that hesitant to pay $1K or so if it's for the life of my tickets..or 10-15 years. We already get notices about certain events at the Dome...but as a SEAT holder...maybe tickets for SEC Champ, Peach Bowl, NCAA Sweet 16/Final Four...those would be nice to have 1st dibs on as well.

I think you pay something like $1,000 up front, but you are agreeing to buy season tickets for those seats for XX years. So, you still have to buy your $700 per seat per season tickets for those XX years. Maybe they'll be reduced rate on the season tickets, but in order to get out of buying the season tickets, you have to sell your seat license to someone else. They usually don't extend it to other events, but I don't like PSLs.

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Atlanta is a transiant city and not a major market. As such, the Falcons base of long term STHs is probably smaller than teams like New York. PSLs would drive away a lot of STHs, leaving the ticket sales base supported by corporations and ticket brokers. Fewer ticket sales translates to more blackouts, and before you know it, we will have a brand new, unneeded stadium that rarely sells out and few home games on TV. Look no further than Tampa as an example of what a poison pill PSLs can be in a smaller city.

If Blank imposes PSLs on his fan base, his greed and desire to have his own house will destroy the good will he has had with Atlanta and my 30+ year run as a STH will come to an end.

Fans should be prepared for home blackouts and unaffordable ticket prices. Blank's Folly better look good from the outside because that is all most folks will ever see of it.

I just hope the Falcons win a SB before it happens.

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maybe it is just me....but I would do it.

again maybe it is just me. but I wouldn't mind helping out......BUTTTTTTT I would want the fans to have a percentage rights just like Green bay does.

I know green bay even has fans who work for free to clean the stadium...I would do that in a heart beat.

also the only reason new stadiums in the last five years have gone up 25% is because of the cowboys.......those girls are nuts (150,000$$$$ I mean really)

Green Bay fans bought stock in something that will never pay anything just for the right to say look I got a piece of paper. I love my Falcons but that is pizzing away money for nothing to me. The Falcons don't do anything special regardless of how long you've had season tickets as it is.

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The state and other municipalities have launched a no holds barred assault on businesses auditing anything and everything with very suspect guidelines. So now the GWCC wants to stick it to the fans which they don't give a **** about. The Falcons have to object to this or don't come crying when they don't sell out. In the old days. long before the internet, we used to have to read about the home games because they were blacked out but there are plenty of alternatives now days.

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I've had season tickets for 15 years (the whole group 9 seats). I've renewed even when I was out of work but I've said for a while if they want money for nothing then I will save thousands of dollars every year and buy one he!! of a media set up to watch games at home.angry.png

Yeah I'll be doing the same thing Phatty.

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As someone that has worked for Blank I'd be shocked if he DiDN'T do it. I'm not paying 1k/seat for the 'right' to purchase nose bleeds. So with a PSL I'd be guaranteed a seat eh? Meh. Better offer a payment plan..monthly.

What did you do for Blank?

I don't see anything wrong with The Dome. I remember when The Braves and the Falcons shared the same field...it was ugly. A friggin baseball diamond in the middle of the football field.

Oakland has the last one.

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