GRAND DESIGNS are in the SPOTLIGHT “Selling lotto tickets with pubs shut is impossible”
Economic reality of Covid-19 will impact greatly on future projects
THE FINANCIAL effects of the shutdown wrought by the coronavirus pandemic is placing GAA infrastructure projects under scrutiny once again.
The issue of counties redeveloping stadia at enormous, sometimes unmanageable, cost was addressed by director general of the association, Tom Ryan, in his annual report.
And it has assumed a much sharper relevance in light of the clearing of GAA schedules, depriving counties of income from gate receipts in the short-term.
In the longer term, with economic difficulties a certainty, borrowing for projects is certain to become more difficult, too, obliging all sporting organisations to assess their plans for capital investment projects.
Ryan’s comments were sourced in the Páirc Uí Chaoimh debacle, and the news that as well as bank debt in excess of €20 million, the project also required a €10 million loan from Croke Park.
However, other counties have required bailouts from headquarters as ambitious stadium works spiralled out of control.
This has left some counties burdened with huge debt, among them Mayo.
Their work on MacHale Park in Castlebar saw costs mushroom until, in February 2015, Croke Park stepped in.
As well as a bank loan of €5 million, €5 million was also borrowed from central funds. When the GAA took over the debt, the Mayo board were trying to make eye-watering repayments of
€48,000 a month. One official spoke of the ‘incredible pressure’ to meet repayments and, under the terms of the agreement with Croke Park, Mayo agreed to repay €33,000 a month.
It’s still an enormous amount of money, and clubs in the county are levied to help meet the cost. These are not uniformly applied to all clubs, but can be as much as €7,000.
In a country with a robustly functioning economy, raising money for clubs can tax the ingenuity of fundraisers. But in the midst of a global pandemic that could leave over 400,000 out of work in Ireland, disposable income shrinks and the most passionate supporters have to make priorities.
It was in such a climate that the Mayo board released a statement addressing the issue in recent days.
‘In light of the current Covid-19 situation we are all facing, the Mayo GAA executive can confirm we will be suspending all levy payments to our clubs for the months of March and April,’ it read.
‘We appreciate many clubs and their members are facing an uncertain future and we want to try and help ease the burden on all clubs across the county by suspending their payments during this time.
‘This situation will be reviewed next month and clubs will be updated accordingly.’
It was nothing more than a recognition of the uncertainty affecting every household in the land, but it was also a reminder of how infrastructure projects in the GAA have careered out of counties’ control in the past.
Offaly are another county that have required a bailout in the past, connected to the burden of redeveloping O’Connor Park in Tullamore, but the disastrous Páirc Uí Chaoimh project was the trigger for Ryan to lay out, plainly and sternly, how future projects would be managed: centrally, and strictly.
The need for that level of oversight was obvious even before the current crisis. But with the economy facing months if not years of contraction, that requirement is now urgent. ‘Future projects must be controlled centrally with appropriate oversight,’ he wrote in his annual report.
‘We must engage professional project management expertise. Central Council funding must only be issued proportionately with progress, rather than up front.
‘Projects can only be permitted to start when all the funding is in place, and not proceed contingent upon future income.
‘These measures, and more, are pertinent today as we contemplate improvements to a number of other grounds around the country.’
Ryan was quietly devastating in his comments on Páirc Uí Chaoimh. He noted that the original cost was put at €78.5 million, and this was ‘to be borne by GAA funds both locally and nationally and by state funding. And without any recourse to borrowings’.
That last point was given a sentence all of its own, as if to amplify the forlornness of that target. Noting the escalation of costs and that ‘budgetary control proved inadequate’, Ryan would reveal in his report that ‘an ultimate cost of €96 million is reliably projected’. Bank borrowings stand at €21.5 million, while Croke Park is owed €10 million. When Peter McKenna, Croke Park stadium director and the GAA’s commercial director, suggested in a newspaper interview in December 2018 that the eventual cost of the Páirc Uí Chaoimh redevelopment would reach €110 million, it caused apoplexy in Cork. There was outrage, there were denials, and McKenna was called reckless at a meeting of the Cork County Board.
That fury seems to have cooled, and it would take a brave person to swear the final cost will not prove McKenna’s estimation of €110 million wrong.
Income has not reached the levels expected because, said Ryan, ‘the sale of 10-year premium seats was undersubscribed and land that was earmarked to be sold to fund part of the build cost proved to be overvalued’.
Short-term income generators could also suffer: plans for Westlife concerts in August may be unaffected by current events, but nothing can be predicted with any confidence at this point.
If a major mistake like Páirc Uí Chaoimh is easy to identify and avoid in future, lower-level difficulties are bound to arise.
Club lotteries, for instance, are a reliable sources of income for clubs all over the country, but selling tickets when pubs are shut and people are obliged to be as cautious as possible in their public dealings is virtually impossible.
This will leave clubs gasping for funds, some of which have their own refurbishment costs to meet.
It is one more problem to consider of the many that have suddenly materialised for sporting organisations.
And the bleak reality is they will not easily dissipate. It makes good husbandry an even more highly-prized resource.
Expect grand design ambitions in Gaelic games to be scaled back accordingly.