Are the Rhinos next to fold? Amerks' future depends on finances Post Comment (November 23, 2007) — Chastened by past mistakes in financial investments like the high-speed ferry, City Hall was wise to ask owners of the Rochester Amerks for their books. Consequently, the city is on sound footing to put stipulations on a request by Amerks owners for concessions. They're in talks to renew the Amerks' lease at Blue Cross Arena. The city, led by Corporation Counsel Thomas Richards, has reasonably asked Amerks president and part-owner Steve Donner to clean up the finances of the American Hockey League team and those of his other sports franchises. The city's review of the Amerks' books found that the hockey team and Donner's other franchises were being financed on borrowed money, which included funds from city taxpayers. The city also discovered that the Amerks may have more than $1 million in debt. Richards calls Donner's sports empire, which also includes part ownership of the Raging Rhinos soccer team, the Knighthawks of the National Lacrosse League and the Rattlers outdoor lacrosse team, a house of cards. It certainly looks that way. There's trouble on every hand. The Buffalo Sabres of the National Hockey League may be ending its 25-year-old relationship with the Amerks. The Sabres, owned by local businessman Tom Golisano, have also notified Donner that the Amerks are in default and owe $27,000 as part of the affiliation agreement. Meantime, the Amerks' minority owners have taken Donner to court to try to gain oversight of the Amerks and Knighthawks franchises. They obviously don't trust him. What a colossal mess. Donner, however, insists that all is well and that he is preparing documentation to support his contention. He needs to step up his response to all that's being thrown at him. It must be thorough and reassuring. He should save everyone time by simply acceding to the city's demand for financial restructuring and a change in management. City Hall must not budge. Still recovering from the high-speed ferry fiasco, the last thing that the city needs is to be perceived as having not learned its lesson about financial due diligence.
I think that Nike putting big money into USL is a good bet. I have heard that from another source. If they can pay athletes millions to endorse their product, they can infuse some into the league. 100 million is peanuts to them. They will give each team four or five million a year for operations and players and in a short time the USL will be the number one league in the US. You will see other franchises coming into the USL after this year to get in on the subsidy.
The Nike money post was a joke but for some curious reason there will be six new USL1 franchises in 2009. You can be assured of that.
Things are getting worse for the Rhinos. December 1, 2007 PAETEC Park may shift woes to the city Brian Sharp and Jeff DiVeronica Staff writers The city could end up inheriting PAETEC Park if the owners of the Rochester Rhinos soccer team can't find a solution to their mounting debts. The extent of their woes, which could exceed $10 million in debt according to three separate sources with knowledge of the finances, would dwarf those already revealed for the Rochester Americans hockey team. Both clubs are owned by the Rochester Sports Group, headed by Steve Donner of Greece. Team officials say the Rhinos' problems could be resolved soon, and Donner says he has a deep-pocketed investor lined up. Donner has made similar promises about the Amerks. He was in New York City on Friday and could not be reached. City Corporation Counsel Thomas Richards is overseeing Amerks lease negotiations as well as a pending $4 million state grant for PAETEC Park. He said both operations are insolvent based on financial records obtained by the city. Richards described the Rhinos and PAETEC Park's debt as "very substantial," but he and others familiar with the situation declined to discuss details. Everything is on hold, Richards said, until RSG's financial woes are solved. "The moment of truth comes in the spring, doesn't it?" he said. "If (the Rhinos) are unable to function, the stadium comes back to the city ... and that's not our plan." The city is charged with administering a $4 million state grant that would pay to complete PAETEC Park with 18 luxury suites and a finished press box. Richards said the city would not release the money until the ownership group could show it was financially stable. The same requirement has led the city to deny, for now, a $100,000 loan Donner sought earlier this year for the Amerks. For taxpayers, the stakes are high. The state already invested $19 million in the stadium, which opened in June 2006. The Rhinos must show documentation that the money was properly spent before the final $4 million can be released. "Ultimately, (the Rhinos) can fail and simply walk away," Richards said. "It may be painful for them financially, but they can walk away. The city can't walk away." In addition to the state support for PAETEC Park construction, the city kicked in about $4 million for road improvements. Rhinos officials say they have invested close to $10 million in the park. Their bank debts have been secured with liens on the stadium lease and the franchises. The lease terms require whoever holds the lease to put a team on the field of equal or higher standing to the Rhinos. Fail to do that and the lease is void, Richards said. The club owns the stadium. However, no bank can hold a lien on the facility because the city owns the land, he said. The Rhinos owe at least $4.6 million to NBT Bank, based in Norwich, near Utica, the hometown of Rhinos President Frank DuRoss. He said Friday that the loan has not yet come due. "We are very close to resolving many of the financial conditions for the Rhinos and stadium," said DuRoss, who sold the AHL's Providence Bruins in 2006 for a reported $3.5 million. Richards said he does not want to discourage any investors in the local teams, but added: "We're going to be dealing with the reality of this." He said the city has made its position clear — that proof of an investor is needed to move forward. RSG operates the American Hockey League's Amerks and indoor lacrosse Knighthawks, as well as the Rhinos and outdoor lacrosse Rattlers. The Amerks and Knighthawks are also fighting debt — with about $1.8 million in bills outstanding, officials said, plus a past-due $500,000 city loan. Financial concerns are a contributing factor to a looming split between the Amerks and Buffalo Sabres after a 29-year affiliation. Donner has said he has an offer from two parties to buy as much as 50 percent of the Amerks and Knighthawks. The deal might be significant enough to settle debts and pump money into the organization. But Donner won't reveal the potential investors' names. Until he does, it's like saying the check's in the mail. Tim Holt, executive vice president of the United Soccer Leagues — the Rhinos' league — said the club is "fully committed" to playing in 2008. "We have every confidence the Rhinos will be around for many years to come," Holt said. But many vendors around town have lost trust. Reitz Signs of Avon is owed more than $9,000. Tom Coyle, vice president of Monroe Ambulance, said he has told the Rhinos they have until Dec. 14 to pay $6,700 owed for the 2007 season. Bob Spatola, president of Spatola's Party Rental, said the club has owed him $50,000 since the 2006 inaugural season at PAETEC Park, when his company furnished equipment, tables, chairs, fencing and draperies. Spatola said he has been told repeatedly by Donner that he will get paid when the remaining $4 million comes in. DuRoss confirmed that Friday, explaining that $650,000 of that money is for "furniture, fixtures and equipment." Ultimately, city officials say, the goal is to get the teams and PAETEC Park back on track. "We're asking the right questions," said Mayor Robert Duffy. "Sometimes those questions are painful. Sometimes those questions are controversial. ... (But) we fully support our sports teams."
This situation is FUBAR as long as Scott Donner is involved. It's sad, because it wasn't always this way. PTP, in my honest opinion was more than the Rhinos could handle. And if the Rhinos fold, it's a kick in the balls for the city of Rochester.
Folks, this league is in deep doo-doo when its flagship franchise with its own brand new publicly-funded stadium is in this much finanical trouble. If the Rhinos, with their great attendance and history and spiffy stadium, can't make it, it's hard to see how teams without as much going for them as Rochester has can make it.
Not sure about htis one. one one hand it appears all doom and gloom for the francise. Lossing the Rhinos would be a bad thing On the other, having lived in that part of NY, I know much politics plays into these things. Most (if not all teams) owe money to someone, thats business. Its doesnt look good that some of these people havent been paid for quite some time but that happens too. There have always been opponents to the Rhinos publicly funded stadium and to me it sounds like some one trying to scare up some neg publicity or laying the base for a mud slinging campaign in the future. Also not to be a conspiracy theroist but who are the major supporters of bringing back a team to syracuse, What are there intrest in this matter. I would assume they would like to get back into the league with out the fee Rochester was going to make them pay. This is one reason I have been told that the Battery choose not to seek public funding for Blackbaud stadium. Too keep politics and as many hands as possible out of the way the club is run. Of course I could be way off base but I wouldnt be surprised if this were the case.
the Syracuse group went bankrupt. Well the company that was going to own the team filed for bankruptcy due to the housing market from what I believe. That was the same group that was going to invest in QCFC as well, but backed out due to finances, if they couldn't afford an amateur team, I don't think they could afford a professional team.
The issue isn't the Rhinos being viable or not having value, it's the ownership group of the Rochester Sports Group (owners of AHL Americans, MLL Rattler, ILL Knighthawks) that is insolvant due to absurd business practices. I believe this ownership group has run it's course though as they've duped everyone they can out of money. There aren't any businesses left in the area willing to do work for them without upfront payment and the ownership group no longer has cash or the credit to do that. And as the article said, until the RSG can prove it's solvancy and prove that it will use state funds correctly the city is not going to release the final $4million to complete PaeTec Park. If you look through the lawsuit brought against Donner by a partner with the AHL Amerks you can see the dubious way in which Donner runs a business. Currently the m.o. for Donner is, "We have a NEW big money investor lined up." However while he's saying that, one of his new investors from last year is jumping ship. The Rhinos have value, especially with PaeTec Park. Us local fans are hoping for a complete buyout of the team from the RSG.
Because, as we've learned, the "Specific" in "SSS" means "to have 3 sides." I think it's a combination of not enough money, not enough fans, not worth it for USL. I think the theory is that if they ever go mls, they'll fill it in. In the mean time, I think they're supposed to put a snack stand/picnic table plaza of some sort there.
The orginal plan was to have a state of the art performing stage to put the open space, but... as we all know Steve Donner has no money and neither does Frank DuRoss. I don't expect a stage with this ownership. PaeTec Park has a lot of potential, just not with the existing ownership.
However, the RSG now owes the party tent place hundreds of thousands of dollars so they won't do business with them anymore and put up the apropriate tents for the picnice plaza.
The facility lacks locker rooms for the players (and the refs). The teams are placed in one of 2 trailers which are tied to a water-filled truck so the players can shower. The refs room was built into a large equipment storage area where the food service and stadium employees work, in order to get into it you have to first go through the men's staff bathroom which I've always thought was funny. The press box has not been finished yet. Right now they have a make shift roof and a piece of plastic protecting the writers and press box staff from the elements. The luxury suites are not yet finished. That 4 million dollars could allow them to finish the stadium, but will the city or state take a risk on giving them the money? It will be interesting to see - and to say the least, the city really needs to rhinos, though I'm sure the city doesn't need them as much as the rhinos need the city.
Whether RSG defaults or not, whether the Rhinos exist in their current incarnation or not, the city/state needs to swallow their pride and pony up the 4 mil. Hopefully they're just waiting for Donner/DuRoss to get out of the picture, but the longer that stadium sits unfinished, the less likely the construction is going to happen. And if it doesn't happen, it's going to become a very expensive white elephant in the city. From that previous post, we're not talking about extra bells and whistles, we're talking about necessities. Almost all small high school stadiums have permanent locker rooms and some kind of enclosed press box. Signs of urban decay are everywhere in Upstate NY, it would be really stupid for politicos to let that decay spread over 4 million bucks. For non-Rochester types, Jeff DiVeronica is the team beat writer up there and he's done a good job with info and analysis about the situation in his blog: http://www.democratandchronicle.com/blogs/devo/ The way he explains the move from Frontier Field to PTP kind of reminds me of a restuarant that is moderately successful, and decides to open a second location. It spreads itself too thin financially and ultimately takes down both locations, even the successful one. That said, sounds like there's a lot more to the problem, most of it being Donner. I can see how he and Marcos co-exist. They both excel at getting people to spend their money on a failing proposition.