'Hundreds of additional expenses'
Ask, and apparently ye shall receive.
A couple days ago I noted a pretty big difference — roughly $7 million worth — between the amount of money the Rhinos have received for the stadium project and the amount they've already paid LeChase Construction to build the thing. I then asked simply, "Where did the money go?"
I asked that question hoping to receive an answer, and today I did. I spoke with a high-ranking Rhinos official this afternoon, and the official gave a rundown of that $7 million.
First of all, the official noted, the difference between the income total and the LeChase bill is actually more around $6.4 million. That's largely because although the state Senate pledged $4 million, the Rhinos have only received $3,350,000 of it.
The official also said that the Rhinos HAVE, in fact, paid NBT Bank some money in the form of scheduled interest payments. (The fact that interest payments were being made wasn't totally clear to me from either the NBT lawsuit itself or the D&C's coverage. But after reading the first 40 pages of the lawsuit, my brain started to get all gooey, so I might have missed it in my delirium.)
Having said all that, the official listed some of the other checks the Rhinos have had to write for the stadium. "There are literally hundreds of additional expenses," the official said.
For example, the team has paid out roughly $2 million to the Kansas-based firm HOK for architectural services. That payment goes directly from the Rhinos to the architects, not to LeChase.
Other expenses paid to other companies, not LeChase, included:
— $750,000 for engineering fees
— $500,000 for legal expenses
— $250,000 for various insurance plans
— $100,000 for the installation of a phone system
— $225,000 for temporary trailers and offices
— $250,000 for furniture and other niceties
— $150,000 to buy two pieces of property related to the project
And, the official said, "the state is aware of all of this." I then asked him/her about why Rochester Mayor Bob Duffy has requested an audit of the stadium financing by the state Comptroller.
The Rhinos official said Duffy's request is understandable given the city's previous entanglement with the fast ferry. However, the official said, any audit of the stadium will find nothing damning.
"An audit will show that state funds went to where they were supposed to go," they said. "There were checks and balances in place to make sure that happened."
They also called my "Where did the money go?" post "sensationalistic" because "it presents a very negative view" of the Rhinos and the stadium.
Now, I suppose, we have to wait for a decision from the Comptroller's Office and for the results of an audit, if one is conducted.
But, when it comes down to it, I'm glad I asked where the money went, because I got an answer. Asking is always the first step toward enlightenment.
I don't really know what that means. It just sounded good.
A couple days ago I noted a pretty big difference — roughly $7 million worth — between the amount of money the Rhinos have received for the stadium project and the amount they've already paid LeChase Construction to build the thing. I then asked simply, "Where did the money go?"
I asked that question hoping to receive an answer, and today I did. I spoke with a high-ranking Rhinos official this afternoon, and the official gave a rundown of that $7 million.
First of all, the official noted, the difference between the income total and the LeChase bill is actually more around $6.4 million. That's largely because although the state Senate pledged $4 million, the Rhinos have only received $3,350,000 of it.
The official also said that the Rhinos HAVE, in fact, paid NBT Bank some money in the form of scheduled interest payments. (The fact that interest payments were being made wasn't totally clear to me from either the NBT lawsuit itself or the D&C's coverage. But after reading the first 40 pages of the lawsuit, my brain started to get all gooey, so I might have missed it in my delirium.)
Having said all that, the official listed some of the other checks the Rhinos have had to write for the stadium. "There are literally hundreds of additional expenses," the official said.
For example, the team has paid out roughly $2 million to the Kansas-based firm HOK for architectural services. That payment goes directly from the Rhinos to the architects, not to LeChase.
Other expenses paid to other companies, not LeChase, included:
— $750,000 for engineering fees
— $500,000 for legal expenses
— $250,000 for various insurance plans
— $100,000 for the installation of a phone system
— $225,000 for temporary trailers and offices
— $250,000 for furniture and other niceties
— $150,000 to buy two pieces of property related to the project
And, the official said, "the state is aware of all of this." I then asked him/her about why Rochester Mayor Bob Duffy has requested an audit of the stadium financing by the state Comptroller.
The Rhinos official said Duffy's request is understandable given the city's previous entanglement with the fast ferry. However, the official said, any audit of the stadium will find nothing damning.
"An audit will show that state funds went to where they were supposed to go," they said. "There were checks and balances in place to make sure that happened."
They also called my "Where did the money go?" post "sensationalistic" because "it presents a very negative view" of the Rhinos and the stadium.
Now, I suppose, we have to wait for a decision from the Comptroller's Office and for the results of an audit, if one is conducted.
But, when it comes down to it, I'm glad I asked where the money went, because I got an answer. Asking is always the first step toward enlightenment.
I don't really know what that means. It just sounded good.
posted by Ryan Whirty at
6:44 PM
4 Comments:
Ryan: Nice spin by the Rhinos. Perhaps the club did pay some interest expenses. This would be akin to an interest-only mortgage where the borrower pays just the interest due for the first several years of the loan. However, the suit, as I read it, has the bank claiming it is owed about $10.8 million, which includes some interest on the several loans. Therefore, it sounds like the club stopped paying even the interest after awhile. And - bottom line - it's still a $10.8 million bill no matter how the club tries to sugarcoat it.
By
Anonymous, at 3:16 AM
Okay, so it's $6.4 million, not $7 million. And all those additional expenses -- including all the six-figure ones, I assume -- add up to $4.2 million. That leaves $2.2 million earmarked for stadium construction and unexplained at this point. In other words, I'm still skeptical.
By
Anonymous, at 3:45 AM
Not so fast. Some of these expenses have nothing to do with the construction of the facility:
— $500,000 for legal expenses
— $250,000 for various insurance plans
Others are marginally related to construction:
— $250,000 for furniture and other niceties
— $100,000 for the installation of a phone system
— $225,000 for temporary trailers and offices
Are we talking about "furniture" or stadium fixtures. You don't pay for office desks and lamps out of the construction budget. Now, if you're talking about furnishing the luxury suites, that might be a different matter; oh, wait, THERE ARE NO SUITES.
They wouldn't have had to pay for trailers/offices if they had completed the project on time and on budget. And the phone system is a capital expense related to normal operations; they were going to need phones whether they were playing at PAETEC or on a vacant lot in Riga.
By
Anonymous, at 6:41 AM
I bet some of that had to be used to cover payroll, because there was no way they were making money to keep those folks paid.
By
Anonymous, at 3:35 PM
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