Derby County

[PHILINFRANCE]

4 minutes ago, billywedlock said:

That was in essence my point, the penalties need to be rapid and draconian. 

Not like JET's, then.

[The Constant Rabbit]

So if MM doesn't sell up the stadium - CK walks - Derby are liquidated?

 

That about right?

[Hxj]

4 hours ago, The Constant Rabbit said:

That about right?

Yes - Unless somebody else comes in to pay the bills immediately after Kirchner walks and completes rapidly thereafter.

[CyderInACan]

16 minutes ago, Hxj said:

Yes - Unless Mike Ashley comes in to pay the bills immediately after Kirchner walks and completes rapidly thereafter.

There you go 

[chinapig]

49 minutes ago, billywedlock said:

I assume they will do a stadium deal with another midlands club if stadium is not resolved. 

They'd better have a provisional deal in place already, time is running out.

[REDOXO]

5 hours ago, chinapig said:

They'd better have a provisional deal in place already, time is running out.

It’s a matter of where obviously. Off the top of my head Burton and Chesterfield are close but I doubt they have the size required for derby to make enough money. Going to Nottingham is out of the question. Can you imagine the mayhem regardless of which ground they play. This further away is more likely but that will cost a lot in lost revenue too. Kirchner is playing his pair of threes well but I’m not confident of his ability to bluff this over the line. Re enter mike Ashley!

[Davefevs]

56 minutes ago, REDOXO said:

It’s a matter of where obviously. Off the top of my head Burton and Chesterfield are close but I doubt they have the size required for derby to make enough money. Going to Nottingham is out of the question. Can you imagine the mayhem regardless of which ground they play. This further away is more likely but that will cost a lot in lost revenue too. Kirchner is playing his pair of threes well but I’m not confident of his ability to bluff this over the line. Re enter mike Ashley!

Stoke was mentioned previously.

[downendcity]

7 hours ago, billywedlock said:

I assume they will do a stadium deal with another midlands club if stadium is not resolved. 

If they do then Mel Morris is left holding an £80m  £50m £20m  asset now worth what?

Can’t imagine a prospective owner is enamoured about buying a club without it’s own ground, but, given the financial mess DCFC are in, can also understand them baulking at being almost “held to ransom” over Pride Park by the man who created the financial mess in the first place.

Can also imagine a massive public outcry if Derby Council were to use £20m or so of taxpayers money to purchase Pride Park from the man who failed to pay over £30m of tax.

If the new owner won’t buy PP from Morris, is there anything stopping the club continuing to pay rent to Morris as have DCFC since the ffp sale?

 

[Mr Popodopolous]

1 hour ago, downendcity said:

If the new owner won’t buy PP from Morris, is there anything stopping the club continuing to pay rent to Morris as have DCFC since the ffp sale?

Grounds to take issue there too- according to some reports, they haven't been charged rent during Covid. Which if correct breaches certain regulations- P&S regs while I cannot see it written down, it is fair to assume that the rent must be at a fair value of course, but I suppose % of fair value...but 100% of 0 is still 0! The first Independent Disciplinary mentioned it too.

Think the club in isolation was meant to be £1.1m per season but there were also rental figures due in respect of Club DCFC and Stadia DCFC- all of these entities are consolidated for P&S/FFP purposes.

FWIW, one potential figure we had for a fair rent was £4.16m per season- that is from IDC 1 and is from the very same company who valued it. 100 days use took it down to £1.1m per season but how many days would be allocated for Club DCFC and Stadia DCFC is a good question.

The other bit here- when we look at Aston Villa and their transaction (NSWE Stadium Limited), Birmingham City to date (Birmingham City Stadium Limited), Reading- at least in year 1 when it was Renhe Sports Management Limited- now it's a foreign company but so long as the rent is expensed against costs and FFP and Sheffield Wednesday (Sheffield 3 Limited) we will see a rent receivable.

Gellaw Newco 202 and by extension Gellaw Newco 204- the stadium company and its parent- show nothing at all in respect of rent receivable.

Club and Club DCFC, Stadia DCFC accounts are also not in the public domain as they should also show something.

On the one hand I think Derby should be given a bit of time to recover and breathe...on the other hand the conditions post exiting administration, part of me thinks they should be applied as such in order that no other club considers trying this level of defiance and ducking and diving and so forth that we have seen in the last few years. I'm pretty conflicted. The deterrence must be big.

That said the Football League have to date ie from last May upheld their rules excellently, albeit quite a bit too late.

Edited May 18, 2022 by Mr Popodopolous

[Lanterne Rouge]

2 hours ago, Davefevs said:

Stoke was mentioned previously.

 

1 hour ago, billywedlock said:

And Leicester 

I wonder about Coventry, nice little earner for the stadium owners but I think they have rugby there too don`t they whereas Stoke & Leicester don`t.

[cidered abroad]

1 minute ago, Lanterne Rouge said:

 

I wonder about Coventry, nice little earner for the stadium owners but I think they have rugby there too don`t they whereas Stoke & Leicester don`t.

Derby could not share Coventry because of Wasps in the Premiership rugby. Prem rules  clearly state that Wasps can only share with one other club which is now Coventry City.

[Derby_Ram]

Go away for a week and things move on. Obviously pleased to see the CK isn't just a tyre kicker and genuinely confident we will come out of this the other side.

A bit more on ground share - explored but isn't a viable option. If stadium is purchased to MM's satisfaction he'll write off the other outstanding loans (£125m-ish) in the club. If not, then as the biggest creditor he can destroy any route to exit. It does appear Pride Park or nothing

Saying that what I am understanding is there will be a purchase of the ground and CK will lease it ahead of the 31st.

What happens after that re business plans, level of repayments etc is for another day. Totally get the hypotheticals and what if this, what if that; but until the details emerge I'm really of the mindset it's not worth the time and effort and working myself/ yourselves up (as one or two seem to be!) as too much of the exact details remains unknown. Plenty of time after the 31st - if not sooner - to go over that and praise/hammer the EFL as necessary for being strong enough/too lax.

[luke_bristol]

If HMRC are prepared to sacrifice 65% of the bill to keep Derby alive, as a taxpayer I’m prepared to sacrifice 100% of it to make sure they die, to discourage others. What an alarming precedent.

[Mr Popodopolous]

Companies have been wound up over much lower rates tbh. Or perhaps more accurately in some cases, Indeed, owing HMRC in excess of £750- not £750,000 but £750- can be grounds.

https://www.ukliquidators.org.uk/company-debt-advice/can-hmrc-force-my-company-into-liquidation

How on earth did HMRC let it get anywhere this amount. Why was the attempted winding up order in Jan 2020 thrown out too?

Suffice to say, I would not want Derby to go bust but if it's at the expense of a) A haircut for the taxpayer or b) EFL post Insolvency Regs being compromised in any respect then it might be the lesser of two evils.

Edited May 18, 2022 by Mr Popodopolous

[Mr Popodopolous]

In respect of HMRC, they cannot just do what they like. I expect that this might have interest in Nottingham and Leeds.

https://www.gov.uk/government/organisations/the-adjudicator-s-office

Unsure if the rules and law have changed- this was 2007- but they do owe a duty of care as an organisation to the taxpayer.

https://www.accountingweb.co.uk/tax/business-tax/court-finds-taxpayers-can-sue-hmrc-for-damages

To what extent would say 35% in 3 years- so a theoretical let's say reduction of £23.4m in the debts due to HMRC, be working on behalf of the taxpayer? Would complaints to MPs be in order if this is permitted to stand.

Edited May 18, 2022 by Mr Popodopolous

[Mr Popodopolous]

https://www.gov.uk/government/organisations/hm-revenue-customs/contact/complain-about-hmrc

https://www.gov.uk/complain-about-hmrc

https://www.att.org.uk/hmrc-complaints-process

Unsure if any of these are relevant or applicable but who knows.

[chinapig]

6 minutes ago, Mr Popodopolous said:

Companies have been wound up over much lower rates tbh. Or perhaps more accurately in some cases, Indeed, owing HMRC in excess of £750- not £750,000 but £750- can be grounds.

https://www.ukliquidators.org.uk/company-debt-advice/can-hmrc-force-my-company-into-liquidation

One wonders if they took a lax line owing to Mel's 2017 donation? Well who knows...

Favours to Red Wall types? Who knows.

I would say, liquidation would be a morally more palatable option than a) A major HMRC haircut or b) Any kind of compromise on EFL regs.

I'm sure the local MPs will want to take credit for saving the club but I don't think there is any political conspiracy.

Much more likely that HMRC will have no problem putting a small club out of business but not a major one. Bad PR as they would get the blame for Derby's demise regardless of Morris being the one and only culprit.

But of course HMRC don't do sweetheart deals, honest guv.

 

[Mr Popodopolous]

1 minute ago, chinapig said:

I'm sure the local MPs will want to take credit for saving the club but I don't think there is any political conspiracy.

Much more likely that HMRC will have no problem putting a small club out of business but not a major one. Bad PR as they would get the blame for Derby's demise regardless of Morris being the one and only culprit.

But of course HMRC don't do sweetheart deals, honest guv.

 

Valid and fair points- but Derby doesn't exist in a bubble, so what's good for one part of the country can be seen as special favours elsewhere- complaints to MPs in other parts of the country?

Would waiving of a good slug of debt for one company/one part of the country be deemed a questionable subsidy or is that a bridge too far?

[chinapig]

1 minute ago, Mr Popodopolous said:

Valid and fair points- but Derby doesn't exist in a bubble, so what's good for one part of the country can be seen as special favours elsewhere- complaints to MPs in other parts of the country?

Would waiving of a good slug of debt for one company/one part of the country be deemed a questionable subsidy or is that a bridge too far?

I keep referring to sweetheart deals so people can judge for themselves here whether letting a business off paying 65% of its liability is consistent with what HMRC claims:

https://farnellclarke.co.uk/news-and-resources/articles/hmrc-sweetheart-deals/

https://www.gov.uk/government/news/hmrc-responses-to-inaccurate-claims#hmrc-does-not-do-sweetheart-deals-with-anyone

[chinapig]

6 minutes ago, Mr Popodopolous said:

Valid and fair points- but Derby doesn't exist in a bubble, so what's good for one part of the country can be seen as special favours elsewhere- complaints to MPs in other parts of the country?

Would waiving of a good slug of debt for one company/one part of the country be deemed a questionable subsidy or is that a bridge too far?

I suspect other clubs who pay their taxes will have something to say but I doubt politicians or indeed the media will be bothered.

[Derby_Ram]

10 minutes ago, Mr Popodopolous said:

In respect of HMRC, they cannot just do what they like. I expect that this might have interest in Nottingham and Leeds.

https://www.gov.uk/government/organisations/the-adjudicator-s-office

Unsure if the rules and law have changed- this was 2007- but they do owe a duty of care as an organisation to the taxpayer.

https://www.accountingweb.co.uk/tax/business-tax/court-finds-taxpayers-can-sue-hmrc-for-damages

To what extent would say 35% in 3 years- so a theoretical let's say reduction of £23.4m in the debts due to HMRC, be working on behalf of the taxpayer? Would complaints to MPs be in order if this is permitted to stand.

100% correct in that we cannot do what we want in relation to HMRC, but, if there's an agreed deal between HMRC and us then are we doing as we want?

Playing devil's advocate on would a reduction of £23m (or whatever figure it ends up being) be working on behalf of the taxpayer; would holding out for everything and getting nothing if the club is liquidated + future payments(!!) also be in the taxpayers interest? (by the way not ignoring the flipside that it sets a precedent for other teams doing the same but just saying why it can be viewed as being in taxpayers interest).

Ultimately I'm with Chinapig that rightly or wrongly it would be PR disaster for them if we went pop. Personally massively conflicted if it does play out this way but I can see why it would.

[Mr Popodopolous]

1 minute ago, Derby_Ram said:

100% correct in that we cannot do what we want in relation to HMRC, but, if there's an agreed deal between HMRC and us then are we doing as we want?

Playing devil's advocate on would a reduction of £23m (or whatever figure it ends up being) be working on behalf of the taxpayer; would holding out for everything and getting nothing if the club is liquidated + future payments(!!) also be in the taxpayers interest? (by the way not ignoring the flipside that it sets a precedent for other teams doing the same but just saying why it can be viewed as being in taxpayers interest).

Ultimately I'm with Chinapig that rightly or wrongly it would be PR disaster for them if we went pop. Personally massively conflicted if it does play out this way but I can see why it would.

Sorry, what I mean is- I worded it badly, HMRC perhaps cannot just do what they like without challenge in theory, although in practice yes probably they can to an extent.

That's also fair. Future returns are a consideration but perhaps shouldn't be decisive- arguments for and against. On the other hand if HMRC in quite a high profile case get zilch, but the entity is wound up or liquidated then that sends out a message to businesses large and small, self-employed whoever that HMRC will get their dues or the individual or entity will suffer the full consequences. Talking wider than just football btw.

PR disaster? What about repayment over 10 years say. Are there any regulations surrounding an ability to take £x or x% of entity turnover and ringfence it for HMRC debts...

[Derby_Ram]

5 minutes ago, chinapig said:

 

https://www.gov.uk/government/news/hmrc-responses-to-inaccurate-claims#hmrc-does-not-do-sweetheart-deals-with-anyone

Thanks. Confused by this bit...

"HMRC will never accept a lower payment than we could reasonably expect to achieve in court. We will only accept the full amount of tax, interest and penalties owed."

They'll only accept the full amount...but will not accept lower than what could be achieved in court. Does this mean they reasonably expect they'll receive 100% every time even when it's not there? Maybe misinterpreting it but feels contradictory?

[Derby_Ram]

1 minute ago, Mr Popodopolous said:

Sorry, what I mean is- I worded it badly, HMRC perhaps cannot just do what they like without challenge in theory, although in practice yes probably they can to an extent.

That's also fair. Future returns are a consideration but perhaps shouldn't be decisive- arguments for and against. On the other hand if HMRC in quite a high profile case get zilch, but the entity is wound up or liquidated then that sends out a message to businesses large and small, self-employed whoever that HMRC will get their dues or the individual or entity will suffer the full consequences. Talking wider than just football btw.

PR disaster? What about repayment over 10 years say. Are there any regulations surrounding an ability to take £x or x% of entity turnover and ringfence it for HMRC debts...

Got you.

And I get the view on sending out messages and not just related to football. Fully. Was just vocalising the opposite, and as said it causes me internal conflict which is why trying hard not to focus on this side too much until everything is clearer.

Last point - I don't know. If so, great, all for something following any such process or regulation. Just not a huge fan of trying to create a new process to fix a case if it's not already in place.

[chinapig]

12 minutes ago, Derby_Ram said:

Thanks. Confused by this bit...

"HMRC will never accept a lower payment than we could reasonably expect to achieve in court. We will only accept the full amount of tax, interest and penalties owed."

They'll only accept the full amount...but will not accept lower than what could be achieved in court. Does this mean they reasonably expect they'll receive 100% every time even when it's not there? Maybe misinterpreting it but feels contradictory?

Exactly the point I have made before. Unless I am missing something the 2 statements can't both be true as you say.

If HMRC are confident in their case and figures why would they expect a court to determine a lower amount?

And it would only take one case that doesn't meet their criteria for their claims to be disproved. It's probably not wise to say "we never do x" or "we always do y".

Frankly I think the whole press release is a case of them protesting too much.

Edited May 18, 2022 by chinapig

[ScottishRed]

If, and is a huge if, this pans out the way predicted i.e. HMRC do a deal and the council buy the stadium and lease it to the club, all hell will break lose, as it should.

The clear implication is that public funds are being used to ‘save’ a football club - sorry, but that is wrong,it should not happen under any circumstances and I include BCFC in that.

For the record I do not ever want to see ANY football club go under but the facts are stark, the previous owner played fast and lose and as he can’t / won’t pay the price, his previous asset has too.

It is that simple.

[Derby_Ram]

10 minutes ago, ScottishRed said:

If, and is a huge if, this pans out the way predicted i.e. HMRC do a deal and the council buy the stadium and lease it to the club, all hell will break lose, as it should.

We should know soon enough but I don't think the council buying the stadium is one of the live options any more.

[chinapig]

1 minute ago, Derby_Ram said:

We should know soon enough but I don't think the council buying the stadium is one of the live options any more.

Intriguing. If not the council and not Kirchner, who? Steve Gibson perhaps?

[downendcity]

3 minutes ago, chinapig said:

Intriguing. If not the council and not Kirchner, who? Steve Gibson perhaps?

webuyanystadium.com?

[Mr Popodopolous]

49 minutes ago, chinapig said:

I suspect other clubs who pay their taxes will have something to say but I doubt politicians or indeed the media will be bothered.

Sorry missed this one.

Politicians are (supposedly) there to represent us. What we might have is a handful of MPs from one city and slightly beyond getting a huge slug of HMRC debt waived. 2/3 maybe or just under.

Tail wagging the dog massively. MPs who represent other constituencies have a voice, might it be worth them being leant on about this issue.

The optics are shocking too, in these inflationary times.

Football can do its bit by the EFL imposing a suitably punitive post administration Business Plan on Derby for 2 or 3 years to reflect this haircut and the advantage gained. 

21 minutes ago, ScottishRed said:

If, and is a huge if, this pans out the way predicted i.e. HMRC do a deal and the council buy the stadium and lease it to the club, all hell will break lose, as it should.

The clear implication is that public funds are being used to ‘save’ a football club - sorry, but that is wrong,it should not happen under any circumstances and I include BCFC in that.

For the record I do not ever want to see ANY football club go under but the facts are stark, the previous owner played fast and lose and as he can’t / won’t pay the price, his previous asset has too.

It is that simple.

Totally agree, although what is to be, what can be done? 

All hell should break loose totally agree given the sheer size of the HMRC debt, but I'm expect it'll be a vote winner in Derby, perhaps Derbyshire.

Edited May 18, 2022 by Mr Popodopolous

[Mr Popodopolous]

Can't quote as on phone but was mildly (!) surprised to read a Derby fan suggesting or putting the question as to whether a takeover in conjunction with Covid could see the Book Value wiped!

Probably have to re-read as I can't believe a suggestion to try and pursue yet another loophole and so soon but no!! No. TOWISL (The Only Way Is Straight Line).

Edited May 18, 2022 by Mr Popodopolous

[chinapig]

3 minutes ago, Mr Popodopolous said:

Sorry missed this one.

Politicians are (supposedly) there to represent us. What we might have is a handful of MPs from one city and slightly beyond getting a huge slug of HMRC debt waived. 2/3 maybe or just under.

Tail wagging the dog massively. MPs who represent other constituencies have a voice, might it be worth them being leant on about this issue.

The optics are shocking too, in these inflationary times.

Football can do its but by imposing a massively punitive Business Plan on Derby for 2 or 3 years to reflect this haircut.

Totally agree, although what is to be, what can be done? 

All hell should break loose totally agree given the sheer size of the HMRC debt, but I'm expect it'll be a vote winner in Derby, perhaps Derbyshire.

You're suggesting what should happen and I sympathise. I'm suggesting what I think will happen, i.e. nothing.

Unless the media take it up as a cause perhaps but, with 1 or 2 exceptions, they are either 1. not interested, 2. uninformed or 3. only interested in Wayne Rooney, so that's unlikely.

[Mr Popodopolous]

2 minutes ago, chinapig said:

You're suggesting what should happen and I sympathise. I'm suggesting what I think will happen, i.e. nothing.

Unless the media take it up as a cause perhaps but, with 1 or 2 exceptions, they are either 1. not interested, 2. uninformed or 3. only interested in Wayne Rooney, so that's unlikely.

Depends if enough constituents elsewhere are sufficiently motivated to push MPs surely? 

Thoughts on a suitably punitive 2-3 year Business Plan?

[Mr Popodopolous]

The Derby fan suggesting another loophole.

Posts like this harden my position. Hopefully the EFL will have put the Straight line bit in as a condition.

https://dcfcfans.uk/topic/38855-the-administration-thread/page/1579/#comment-2341482

Edited May 18, 2022 by Mr Popodopolous

[Derby_Ram]

14 minutes ago, chinapig said:

Intriguing. If not the council and not Kirchner, who? Steve Gibson perhaps?

Sports Direct Arena could be even more fun.

Got a feeling a couple of as yet publically unknown local businessmen will facilitate a deal to take the stadium away from MM. A few of the supporters groups have spoken to them separately and seems to be substance to it. Whether it's someone with no previous association to the club or one who was part of the consortium who clubbed together in the mid 2000s remains to be seen. There's something bubbling away which is giving those the supporters groups privy to those conversations confidence which they've not had the last 9 months.

[REDOXO]

Do we actually know with certainty that there is a 65% hair cut on taxation. Or is this an assumption based on what’s in the public domain? 
 

The idea that Mike Ashley/Dports Direct buy the ground is not completely silly. However public funds buying the ground and revenue debt being forgiven is a huge ask of government, local and national. 
 

 

[The Swan and Cemetery]

Maybe there should be a referendum in Derby to vote on how best to spend £23m, if they choose DCFC over hospitals etc, odd, but fair enough and the local MPs can explain their heroics. Not particularly keen on a) my team suffering because of the debts built up by DCFC and then b) having fewer nurses etc where I live to ensure ‘a’ gets swept under the carpet. Moral hazard writ large. 

[Derby_Ram]

44 minutes ago, REDOXO said:

Do we actually know with certainty that there is a 65% hair cut on taxation. Or is this an assumption based on what’s in the public domain? 
 

Assumption.

[Davefevs]

Some good footie banter in here:

 

[CyderInACan]

12 hours ago, Mr Popodopolous said:

The optics are shocking too, in these inflationary times

I was thinking this too. If HMRC & Derby City Council effectively save DCFC then the cost to the the public purse will be incredible money in very lean times. Let's have it right; Derby are, whichever way you look at it, very much the authors of their own misfortune. Derby are just another business that's gambled. And lost. 

I could be wrong but I doubt that outside of Derby too many people would be bothered if they ceased to exist/became a phoenix club on the Derby Downs. 

[Davefevs]

Kieran Maguire’s POF podcast this morning was interesting.  Suggesting that the 25% (35% / 3 years) will be net and points deduction avoided.  However he suggested (paraphrased) that this will be separate to what will be agreed with HMRC, where he expects a “haircut”.  But I interpreted this as not a “number 1 all over”….perhaps a payment plan for most of it over a longer period.  I’m only guessing but for example 80% over 10 years.

https://podcasts.apple.com/gb/podcast/the-price-of-football/id1482886394?i=1000562392467

Be interested in the view of the wise sages on here?

[Midred]

38 minutes ago, Davefevs said:

Kieran Maguire’s POF podcast this morning was interesting.  Suggesting that the 25% (35% / 3 years) will be net and points deduction avoided.  However he suggested (paraphrased) that this will be separate to what will be agreed with HMRC, where he expects a “haircut”.  But I interpreted this as not a “number 1 all over”….perhaps a payment plan for most of it over a longer period.  I’m only guessing but for example 80% over 10 years.

https://podcasts.apple.com/gb/podcast/the-price-of-football/id1482886394?i=1000562392467

Be interested in the view of the wise sages on here?

If only I could have had a word with HMRC about my PAYE! 

[exAtyeoMax]

18 hours ago, downendcity said:

If they do then Mel Morris is left holding an £80m  £50m £20m  asset now worth what?

Can’t imagine a prospective owner is enamoured about buying a club without it’s own ground, but, given the financial mess DCFC are in, can also understand them baulking at being almost “held to ransom” over Pride Park by the man who created the financial mess in the first place.

Can also imagine a massive public outcry if Derby Council were to use £20m or so of taxpayers money to purchase Pride Park from the man who failed to pay over £30m of tax.

If the new owner won’t buy PP from Morris, is there anything stopping the club continuing to pay rent to Morris as have DCFC since the ffp sale?

 

Could the council make a profit on that purchase in some way? 

[downendcity]

30 minutes ago, exAtyeoMax said:

Could the council make a profit on that purchase in some way? 

You'd think so, as Pride Park's "market" is £80m, don't you know!

It must be so, as Mel Morris's independent valuer said so.

[Mr Popodopolous]

Just on the Pride Park bits, my understanding on a few aspects based on reading up.

1) Derby City Council would borrow the money.

2) Councils can borrow at lower rates seemingly, saw 2.8% mentioned somewhere.

3) The rent would be tied to the interest payments. Think the EFL need to substitute in for FFP purposes a paper market rent, perhaps based on  the original Fair Value?

4) FFP aside, think when such a deal occurred with Plymouth, the rental was an annual yield of 8.5%. A £20m purchase means £1.7m rent in simple terms.

5) I would also argue that there is a case for inflation linked rent to protect the investment for the council. 

6) Going back to the Plymouth deal again, the sale price back to the club after a few years of rent was a % greater than the purchase price. Cannot remember, but seemed not to be any discounting for rent.

Council could actually do okay out of it if on strictly commercial and arms length terms.

Reconsolidation of stadium ownership into the Football group is also unacceptable any time soon. A section of the Agreed Decision should give the EFL grounds for pushback

Edited May 19, 2022 by Mr Popodopolous

[chinapig]

1 hour ago, Mr Popodopolous said:

Just on the Pride Park bits, my understanding on a few aspects based on reading up.

1) Derby City Council would borrow the money.

2) Councils can borrow at lower rates seemingly, saw 2.8% mentioned somewhere.

3) The rent would be tied to the interest payments. Think the EFL need to substitute in for FFP purposes a paper market rent, perhaps based on  the original Fair Value?

4) FFP aside, think when such a deal occurred with Plymouth, the rental was an annual yield of 8.5%. A £20m purchase means £1.7m rent in simple terms.

5) I would also argue that there is a case for inflation linked rent to protect the investment for the council. 

6) Going back to the Plymouth deal again, the sale price back to the club after a few years of rent was a % greater than the purchase price. Cannot remember, but seemed not to be any discounting for rent.

Council could actually do okay out of it if on strictly commercial and arms length terms.

Reconsolidation of stadium ownership into the Football group is also unacceptable any time soon. A section of the Agreed Decision should give the EFL grounds for pushback

@Derby_Ram, who seems to have very good sources, says above that it won't be the council buying the stadium so this may be academic.

[Davefevs]

38 minutes ago, chinapig said:

@Derby_Ram, who seems to have very good sources, says above that it won't be the council buying the stadium so this may be academic.

Kieran Maguire suggesting another party is likely too.

[REDOXO]

Just read this on the Derby forum. Answering someone on here called Luke I guess. Apparently MM and his mates at Derby get the same tax pass as whatever organization or industry Gee Screamer decides is somehow not paying their taxes. 

Was Derby not a simple case of not paying employees PAYE payments for several years? 

If HMRC are prepared to sacrifice 65% of the bill to keep Derby alive, as a taxpayer I’m prepared to sacrifice 100% of it to make sure they die, to discourage others. What an alarming precedent.

Well Luke from Bristol, can I Also suggest that the higher rate of tax that the exchequer has missed out on from PAYE would not have stayed there.  Lots of loopholes on a tax return to offset .  Maybe Bristol City should die alongside sport to stop this happening.  Perhaps you should also destroy your TV and stop channels broadcasting with all those pesky buggers getting determined taxation instead of sending in tax returns.  billions overpaid on tax credits a few years ago when it started and written off.  Hunt then down and shoot them.  All those directors taking loans from their own business then going bust next for the chop.  All that s*** you buy online from business not playing the game - stop them trading.  Any business suffering and getting the benefit of not paying some tax they owe, close em down and get a 1000 staff on JSA.  Finally, stop Lukes upcoming bank holiday, it won't be needed when we get rid of the monarchy and seize Charles duchies that he pays ridiculous level of tax on.  

One dimensional bitter nobber 

[chinapig]

1 hour ago, REDOXO said:

Just read this on the Derby forum. Answering someone on here called Luke I guess. Apparently MM and his mates at Derby get the same tax pass as whatever organization or industry Gee Screamer decides is somehow not paying their taxes. 

Was Derby not a simple case of not paying employees PAYE payments for several years? 

If HMRC are prepared to sacrifice 65% of the bill to keep Derby alive, as a taxpayer I’m prepared to sacrifice 100% of it to make sure they die, to discourage others. What an alarming precedent.

Well Luke from Bristol, can I Also suggest that the higher rate of tax that the exchequer has missed out on from PAYE would not have stayed there.  Lots of loopholes on a tax return to offset .  Maybe Bristol City should die alongside sport to stop this happening.  Perhaps you should also destroy your TV and stop channels broadcasting with all those pesky buggers getting determined taxation instead of sending in tax returns.  billions overpaid on tax credits a few years ago when it started and written off.  Hunt then down and shoot them.  All those directors taking loans from their own business then going bust next for the chop.  All that s*** you buy online from business not playing the game - stop them trading.  Any business suffering and getting the benefit of not paying some tax they owe, close em down and get a 1000 staff on JSA.  Finally, stop Lukes upcoming bank holiday, it won't be needed when we get rid of the monarchy and seize Charles duchies that he pays ridiculous level of tax on.  

One dimensional bitter nobber 

Difficult to discern what rational argument might underlie this rant but it looks like whataboutery, perhaps to do with tax avoidance. Like saying "I stole £10 but that person over there stole £50 so I should be let off".

There is a difference between tax avoidance through legal means (much as I dislike much of it) and simply not paying your taxes then expecting the taxpayer at large to take the hit.

As I say, the argument is not entirely clear but suffice it to say that once you start hurling abuse you have probably lost the debate anyway.

[downendcity]

18 minutes ago, REDOXO said:

Just read this on the Derby forum. Answering someone on here called Luke I guess. Apparently MM and his mates at Derby get the same tax pass as whatever organization or industry Gee Screamer decides is somehow not paying their taxes. 

Was Derby not a simple case of not paying employees PAYE payments for several years? 

If HMRC are prepared to sacrifice 65% of the bill to keep Derby alive, as a taxpayer I’m prepared to sacrifice 100% of it to make sure they die, to discourage others. What an alarming precedent.

Well Luke from Bristol, can I Also suggest that the higher rate of tax that the exchequer has missed out on from PAYE would not have stayed there.  Lots of loopholes on a tax return to offset .  Maybe Bristol City should die alongside sport to stop this happening.  Perhaps you should also destroy your TV and stop channels broadcasting with all those pesky buggers getting determined taxation instead of sending in tax returns.  billions overpaid on tax credits a few years ago when it started and written off.  Hunt then down and shoot them.  All those directors taking loans from their own business then going bust next for the chop.  All that s*** you buy online from business not playing the game - stop them trading.  Any business suffering and getting the benefit of not paying some tax they owe, close em down and get a 1000 staff on JSA.  Finally, stop Lukes upcoming bank holiday, it won't be needed when we get rid of the monarchy and seize Charles duchies that he pays ridiculous level of tax on.  

One dimensional bitter nobber 

The loopholes to which he refers seem to be  instances of tax avoidance, i.e. where tax payers legally reduce the amount of tax liability they have,  by using the provisions of the tax regime.  

Derby, on the other hand, failed to pay  the tax liability they had incurred over an extended period of time and I’m guessing that their tax liability would have been realised after their accountants had first applied all the legitimate means of tax avoidance available to them! 

The other issue is that much, if not most, of the outstanding tax was accruing during the period when Morris was spending big on players ( transfer fees and wages) in his attempts to secure promotion. We now know that this was being done by cheating the ffp rules, including selling PP to himself for £80m - an independently valued open market value, that has stood the test of time!

It wasn’t that Derby could not pay the taxman, but that they chose not to pay the taxman so they could afford to maintain a challenge for promotion.

Imagine if I tried to excuse non-payment of my tax bill because to do so would not enable Mrs Downend to keep her wardrobe stocked with the latest clothes, have the 3 foreign holidays she wants and to have the new car every year, I don't think I would receive any sympathy whatsoever from the taxman.

Our owner is a tax exile, which, while morally annoying to many ( including our own fans), is perfectly legal. However, as far as his football club is concerned, he has ensured that have operated within the same ffp rules that Derby flagrantly flouted, and took appropriate steps to comply, even when it meant selling some of our best players , which compromised our on field competitiveness. His club also maintained their tax obligations to HMRC, while I’m sure that withholding tax payments would have given more money to spend on the playing squad.

Many of us are old enough to have witnessed BCFC almost going out of business in 1982. That was caused by what were, with hindsight, some poorly judged contract decisions and the club was saved by fans of the club raising the money to rescue us. It was not as a result of withholding payments from the taxman and then expecting the tax man i.e. the taxpayers of the country at large, to take the hit.

 

 

 

[Mr Popodopolous]

What a bizarre deflecting rant that is. Otoh it is Gee Screamer and I increasingly read his posts in the voice of Victor Meldrew so nuff said...

The whataboutery in general among the Derby fans on there, wow. Sense of entitlement too, no club has an automatic right to League membership. Not had time to read and re-read the rant post but basically he's saying Derby are the lesser of several tax based evils?

Gee Screamer, Derby's answer to Victor Meldrew I'd say!

Edited May 19, 2022 by Mr Popodopolous

[Mr Popodopolous]

5 hours ago, chinapig said:

@Derby_Ram, who seems to have very good sources, says above that it won't be the council buying the stadium so this may be academic.

Thanks. Yeah may well be, just providing a template for how it might work commercially.

[Derby_Ram]

11 hours ago, downendcity said:

You'd think so, as Pride Park's "market" is £80m, don't you know!

It must be so, as Mel Morris's independent valuer said so.

I know you say this part in jest but DRC was the method for the stadium valuations across the board for the teams selling them, used by both Derby and the EFL valuers, and accepted by the EFL and commissions. Morally bankrupt and caused more problems in the long run; but a genuine loophole spotted and gambled on.

9 hours ago, chinapig said:

@Derby_Ram, who seems to have very good sources, says above that it won't be the council buying the stadium so this may be academic.

If one of the two parties don't get the purchase over the line then I'd be shocked if the council don't re-look at it. However if it gets to that stage there'd be bigger challenges than just questioning the use of the publics money and I'd seriously expect liquidation to be the likely outcome.

4 hours ago, downendcity said:

It wasn’t that Derby could not pay the taxman, but that they chose not to pay the taxman so they could afford to maintain a challenge for promotion.

 

Cracking post and feels nit-picking to highlight this bit but its a bit that bugs me and a lot of Derby fans - not what you've said specifically but a bit about MM that doesn't get understood fully - and irks me most about his behaviour.

Not paying the taxman wasn't to maintain a challenge for promotion. He could (and did) do both previously. It was done when he realised the game was up, the gamble on promotion failed, and the last throw of the dice to escape FFP had been used. 

He's still not short of cash, could pay all of the debts and still comfortably sit on any rich list, but when the last gamble at promotion failed and he had no other loopholes as he'd already sold the ground he cut funding. 

I'd still rather not be in the position, but, if he'd used his money to gamble on promotion and then when the last bid before FFP caught up with him he took the points penalty on the chin, still paid his bills, and not put the club in admin I'd still have an element of respect for him. Instead he took the cowards way out and stopped paying bills. An absolute ****.

So its not that HMRC weren't paid to fund a promotion bid but instead they weren't paid when he couldn't skirt the rules any further.

[Davefevs]

34 minutes ago, Derby_Ram said:.

Not paying the taxman wasn't to maintain a challenge for promotion. He could (and did) do both previously. It was done when he realised the game was up, the gamble on promotion failed, and the last throw of the dice to escape FFP had been used. 

He's still not short of cash, could pay all of the debts and still comfortably sit on any rich list, but when the last gamble at promotion failed and he had no other loopholes as he'd already sold the ground he cut funding. 

I'd still rather not be in the position, but, if he'd used his money to gamble on promotion and then when the last bid before FFP caught up with him he took the points penalty on the chin, still paid his bills, and not put the club in admin I'd still have an element of respect for him. Instead he took the cowards way out and stopped paying bills. An absolute ****.

So its not that HMRC weren't paid to fund a promotion bid but instead they weren't paid when he couldn't skirt the rules any further.

Yep, a calculated decision to be a complete ****….far beyond failure to meet FFP rules.

[AnotherDerbyFan]

On 18/05/2022 at 21:13, Mr Popodopolous said:

The Derby fan suggesting another loophole.

Posts like this harden my position. Hopefully the EFL will have put the Straight line bit in as a condition.

https://dcfcfans.uk/topic/38855-the-administration-thread/page/1579/#comment-2341482

It was put in the Nov 2021 agreed decision. Then the new EFL requirement to use straight-line was announced in Feb 2022.

22 hours ago, Mr Popodopolous said:

Just on the Pride Park bits, my understanding on a few aspects based on reading up.

1) Derby City Council would borrow the money.

2) Councils can borrow at lower rates seemingly, saw 2.8% mentioned somewhere.

3) The rent would be tied to the interest payments. Think the EFL need to substitute in for FFP purposes a paper market rent, perhaps based on  the original Fair Value?

4) FFP aside, think when such a deal occurred with Plymouth, the rental was an annual yield of 8.5%. A £20m purchase means £1.7m rent in simple terms.

5) I would also argue that there is a case for inflation linked rent to protect the investment for the council. 

6) Going back to the Plymouth deal again, the sale price back to the club after a few years of rent was a % greater than the purchase price. Cannot remember, but seemed not to be any discounting for rent.

Council could actually do okay out of it if on strictly commercial and arms length terms.

Reconsolidation of stadium ownership into the Football group is also unacceptable any time soon. A section of the Agreed Decision should give the EFL grounds for pushback

None of this really matters as it won't be he council.

1. yes
2. yes
3. Doesn't need to be fair value when they aren't related parties
4. That was in 2011 when there was a recession. I wonder how much that impacted the interest rates payable. Despite everything that's happened over the past couple of years, I wouldn't expect to see much variance in interest.
5. See above.
6. Council bought it for £1.6m in 2011, then sold it for £1.7m in 2016

[Mr Popodopolous]

3 hours ago, AnotherDerbyFan said:

It was put in the Nov 2021 agreed decision. Then the new EFL requirement to use straight-line was announced in Feb 2022.

Not altogether sure I follow- does this make a tangible difference?

My point is that it would be unacceptable probably from a P&S perspective. Right outcome, if questionable or uneven methodology at times. Membership agreement needs to be quite hardline. Anything else would be a failure of governance.

3 hours ago, AnotherDerbyFan said:

None of this really matters as it won't be he council.

1. yes
2. yes
3. Doesn't need to be fair value when they aren't related parties
4. That was in 2011 when there was a recession. I wonder how much that impacted the interest rates payable. Despite everything that's happened over the past couple of years, I wouldn't expect to see much variance in interest.
5. See above.
6. Council bought it for £1.6m in 2011, then sold it for £1.7m in 2016

It may well prove academic yes.

1. Agreed
2. Agreed- although what of the bit about not being able to borrow for yield?
3. The P&S regs would say something different I expect- I am speaking not of the actual amount paid but the fair value amount substituted in for P&S purposes...it's a paper amount different to the actual amount between A N Other and Derby. Remember too that there are and were rental amounts due from Club DCFC and Stadia DCFC as part of the deal/approval, not just the club itself as per IDC 1. Something that gets zero coverage I must say- I recall many were confident that it was the CLUB accounts in isolation that were the relevant factor for P&S regs yet from 2016/17 onwards they were incorrect. Some quite well informed posters seemed to dismiss use of the consolidated accounts in past threads on the FFP issues- these would include rental amounts from Club and Stadia DCFC, whereas the club accounts in isolation would solely include the club rental of £1.1m per year.
4. We have significant cost of living issues now- the optics are rather poor for anything substantially below.
5. Again- optics.
6. Yes, there must have been some formula...based on say a £24m purchase price to take account of MSD and Gibson, a resale at £25.5m would be a simple extrapolation.

Something else I have observed, when discussing Business Plans etc your fans or some of them seem to post in a bit of a tunnel vision, ie the impact on Derby- agreement between EFL and Derby, as if it exists in a bubble. Ghost of Clough seemed to gloss over this part and that is a surprise that he glossed over it.

I digress, interested in the thoughts of yourself and @Derby_Ram on these snippet that I post periodically...

Quote

 However, the fact remains that even with the requirement to meet the minimum dividend to unsecured creditors any Club taking insolvency action will be released from significant amounts of debt whilst all other clubs continue to honour their ongoing commitments. An ongoing embargo restriction as part of a monitored business plan seeks to balance the interests of all members of the League and the integrity of its competitions.

https://ramstrust.org.uk/wp/efl-response-to-ramstrust/

I completely agree with the policy fwiw. Totally- but i sounds like it is not quite as simple as e.g. a Business Plan arranged to keep Derby solvent in a vacuum.

Quote

* The EFL would need to see the details. They would then review the embargo situation accordingly. For the remainder of this season and for the next 2 seasons, the club will need to work within an agreed Business Plan – which includes the EFL approving all player registrations during that period. If the preferred bidder proposal is 35p in £1 to creditors over a 3 year period (rather than 25p in the £1 to unsecured creditors now), the Business Plan and EFL monitoring will cover the next 3 seasons.

Quote

* The consequences of a Club going into administration is twofold.  First, the 12-point deduction is applied.  Second, the terms of the Insolvency Policy then apply – which includes adherence to an agreed business plan that places restrictions on future player signings.  This is to ensure that the Club is operating in accordance with an agreed business plan on exit.

* This is to avoid clubs gaining a competitive advantage by going to into administration, wiping out debts and harming the integrity of the competition.

https://ramstrust.org.uk/wp/dcfc-supporters-groups-meet-efl/

I am completely comfortable with this. Completely- wiping out debts and gaining some sort of competitive headstart is of course unacceptable- 2 year Business Plan or 3 if 35%, yep totally. Given that the EFL Insolvency Policy as a whole isn't in the public domain I'd suggest it gives them a certain amount of freedom- the only bits that are in the public domain are a) The -12 for administration and b) Indirectly via journos, the -15 if the minimum unsecured creditors not paid 25p in the £ or 35p in the £ in 3 years...so fans of Derby who say they deserve no further punishment are perhaps not thinking through the advantages that can be gained via Insolvency.

Therefore the logical answer- to me- is that the EFL Business Plan for 2 or if applicable 3 years, is or should be designed to negate that advantage.

Edited May 20, 2022 by Mr Popodopolous

[Derby_Ram]

27 minutes ago, Mr Popodopolous said:

I am completely comfortable with this. Completely- wiping out debts and gaining some sort of competitive headstart is of course unacceptable- 2 year Business Plan or 3 if 35%, yep totally. Given that the EFL Insolvency Policy as a whole isn't in the public domain I'd suggest it gives them a certain amount of freedom- the only bits that are in the public domain are a) The -12 for administration and b) Indirectly via journos, the -15 if the minimum unsecured creditors not paid 25p in the £ or 35p in the £ in 3 years...so fans of Derby who say they deserve no further punishment are perhaps not thinking through the advantages that can be gained via Insolvency.

Therefore the logical answer- to me- is that the EFL Business Plan for 2 or if applicable 3 years, is or should be designed to negate that advantage.

I guess it comes down to how you interpret things. I don't see that sticking to an agreed business plan that keeps your spending at sensible levels as a punishment. Being a sustainable club is something I'd happily aspire to.

Some fans would see it as punishment no doubt, I wouldn't.

[Mr Popodopolous]

27 minutes ago, Derby_Ram said:

I guess it comes down to how you interpret things. I don't see that sticking to an agreed business plan that keeps your spending at sensible levels as a punishment. Being a sustainable club is something I'd happily aspire to.

Some fans would see it as punishment no doubt, I wouldn't.

Thanks 

That's a fair answer and covers the bit that I neglected to mention. A sustainable Business Plan actually benefits a club, especially on exiting Insolvency.

I also think it's as I say fair to factor in the advantages gained from significant debt reduction in this too.

The League and football probably wouldn't look good if a club wiped 2/3 of HMRC but also unsecured debt especially with the former being at such levels and could spend with relative freedom under a new owner.

[Derby_Ram]

If the takeover does go through the one thing I will say is its probably the best year for us for a business plan to kick in. So many clubs with financial pressures and so many players out of contract you really don't need to be chucking transfer fees and big wages around to be have a good chance to be competitive next season

Also in our favour you have the WR impact. Give a player the choice of 2 clubs in the third tier of football with everything else equal but you can play for manager x or Rooney then it is a pull.

Still relies on recruitment being strong which isn't something  we've excelled at; but given where we are it's not a bad time to be going through this.

[Marvin]

1 minute ago, Derby_Ram said:

Also in our favour you have the WR impact. Give a player the choice of 2 clubs in the third tier of football with everything else equal but you can play for manager x or Rooney then it is a pull.

...or Joey Barton

[Mr Popodopolous]

As to a Business Plan, I'd propose that the following is fair- factoring in the monitored Embargo too:

*New signings or renewal of existing players out of contract not exceeding £6k per week for a player. Whether for the full 2-3 years, dunno.

*No transfer fees payable for new signings.

 *No signing on fees payable or at best to be included in the £6k per week cap.

*No or limited loan fees.

*Agents fees to be capped at a % of the player remuneration.

Whether for Year 1 only or the full period who knows, perhaps open to review as and when. You could make a case for the latter given the Embargo is attached to the monitored business plan.

I think this would balance between the needs of Derby, the rest of the League and the integrity of it all.

Existing players wise, example. Two who will need their contact renewing to stay.

Lawrence (arguments sake) on £20k per week. Has to be negotiated down to £6k per week or Derby lose him.

Davies (arguments sake) on £5k per week. Renewal of him on existing or even slightly higher terms falls within the agreed parameters.

Edited May 20, 2022 by Mr Popodopolous

[Derby_Ram]

Cat out the bag with the Athletic reporting that it's a local property firm - Clowes Development - close to buying the ground and lease to CK.

This would genuinely be a stunning result for us if they get it complete.

[Midred]

Off topic. Leeds and Burnley are threatening legal action against Everton for their financial affairs, possibly because Everton are now safe from relegation. We may be setting up a new topic here!

[Midred]

43 minutes ago, Midred said:

Off topic. Leeds and Burnley are threatening legal action against Everton for their financial affairs, possibly because Everton are now safe from relegation. We may be setting up a new topic here!

See @chinapig new topic!

[Sir Geoff]

5 hours ago, Derby_Ram said:

If the takeover does go through the one thing I will say is its probably the best year for us for a business plan to kick in. So many clubs with financial pressures and so many players out of contract you really don't need to be chucking transfer fees and big wages around to be have a good chance to be competitive next season

Also in our favour you have the WR impact. Give a player the choice of 2 clubs in the third tier of football with everything else equal but you can play for manager x or Rooney then it is a pull.

Still relies on recruitment being strong which isn't something  we've excelled at; but given where we are it's not a bad time to be going through this.

If I was a player signing on that basis I would need some guarantee (impossible, I know) that he would still be there after Christmas. I suspect Derby fans will be hoping Everton have a good start to next season, otherwise the pull 'home' may be too much to turn town for Wayne a second time.

[Hxj]

17 hours ago, Derby_Ram said:

Cat out the bag with the Athletic reporting that it's a local property firm - Clowes Development - close to buying the ground and lease to CK.

This would genuinely be a stunning result for us if they get it complete.

Oh dear - Derbyshire property firm denies it is buying Pride Park Stadium - Derbyshire Live (derbytelegraph.co.uk)

[Derby_Ram]

39 minutes ago, Hxj said:

Oh dear - Derbyshire property firm denies it is buying Pride Park Stadium - Derbyshire Live (derbytelegraph.co.uk)

Let's see how it plays out. I'm still confident

[chinapig]

49 minutes ago, Hxj said:

Oh dear - Derbyshire property firm denies it is buying Pride Park Stadium - Derbyshire Live (derbytelegraph.co.uk)

It seems to be an actual denial rather a non-denial denial, which is usually along the lines of "this is just speculation..." .

Of course they could just be lying.

[Hxj]

11 minutes ago, Derby_Ram said:

Let's see how it plays out. I'm still confident

No doubt it will be imminent!

[chinapig]

12 minutes ago, Derby_Ram said:

Let's see how it plays out. I'm still confident

You would know better than me but why would they rent on generous terms? A commercial deal would presumably mean making a profit within a reasonable period.

Or are the owners life long Derby fans? You know, like Mel Morris.