Carlton wants effectively a $10 million handout and a free early priority pick for themselves. They have to be kidding
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Sinking Blues seek AFL rescue
By Jake Niall
May 16, 2006
CARLTON faces its financial high noon tomorrow when it meets the AFL Commission and requests that the league effectively wipe out its debt with a massive $10 million rescue package involving the sale of Princes Park.
The Blues already have given the AFL a draft of a club financial report in which they warn that the club's financial position is not sustainable and suggest that the league pay them $6 million up front to take over the lease of Princes Park (now called MC Labour Park) — a payment that would wipe out their debts.
Tomorrow's meeting is the first crucial test of Graham Smorgon's presidency, with the new president, who is up for election early next year, under pressure to secure a deal in which Carlton extricates itself from its financial morass.
In other major developments:
■The Blues are considering asking the AFL to reconsider the issue of priority draft picks, arguing that Carlton should qualify for an early "double dip" if it won only four games this year — even though it won four-and-a-half, rather than the new maximum of four games last year.
Under the revised rule, a team can only receive a pre-draft priority pick (i.e., pick 1) if it wins four games or less in one season. Carlton, having won four plus a draw in 2005, would only qualify for a "priority" draft choice at the end of the first round (pick 17) in the event the club won only four games, which it expects to better anyway.
■ The Age has learnt that former president Ian Collins, contrary to some suggestions, would have narrowly survived a boardroom vote 5-4, but chose to leave rather than continue to lead a divided board.
■Carlton had a big disagreement with the AFL about the upfront payment of $2.5 million for shifting most of its home games to Telstra Dome, with the Blues strongly arguing — unsuccessfully — that they were entitled to $3 million under the terms of the deal.
■The AFL's own study of Carlton's finances, which was completed by leading accounting firm KPMG, will have a big influence on whether Carlton clinches its critical deal to sell the lease of its home ground to the league. If the lease deal does not proceed, the Blues will have little choice but to apply for special assistance, formerly the competitive balance fund, that is paid to the Bulldogs, Kangaroos and Melbourne.
■In their own strategic financial paper, written by Carlton board member and merchant banker Marcus Rose with input from Collins, the Blues say that their true financial position has been camouflaged by one-off extraordinary payments, such as the $2.5 million from Telstra Dome, the AFL's Waverley Park money ($1.7 million) and the 2003 debt discounting deal with the bank in which the club wiped off $4.2 million in debt, instead of receiving $1.4 million per year in compensation from the AFL (money the AFL owed for the transfer of non-Carlton games at Princes Park).
Thus, the paper argued that Carlton's financial position, given its on-field struggles, was not sustainable unless it received assistance, with the lease sale — about which the AFL has made sympathetic noises — earmarked as the best way forward.
■Carlton's strategic paper, which recommended the club sell the Princes Park lease to the AFL, suggested that it should not only receive $6 million up front for selling the ground lease, but that the league should pay $2.5 million towards the proposed redevelopment of the ground, and pay for the upkeep — currently about $1.8 million — a grand total of more than $10 million in the first year of the package.
■The strategic paper, details of which have been obtained by The Age, suggests that the Blues should pay a modest $100,000 in rent to the AFL as the main tenant at Princes Park.
http://www.realfooty.theage.com.au/realfooty/articles/2006/05/15/1147545265024.html
