Leeds City Council move in to bail out LUFC? TSS August 19, 2009 Leeds United 8 Comments Are you thinking of placing a bet on an event taking place at this years Olympic’s taking place in London? Make sure you head to betfair.com to make all of these bets! Sometime yesterday, a document was published on the Leeds City Council (LCC) website outlining the possibility of a council loan being used to help Leeds United repurchase Thorp Arch. You can see the document by clicking the link below. Leeds City Coucil proposal (PDF) It basically says that Leeds United have until the 10th of October to repurchase Thorp Arch before a buy-back clause expires. Although the club will have an additional twenty years use of the facility if they can’t buy it back, this will incur yearly increasing rent which is a growing burden on the football clubs prospects. The document explains that Leeds United has tried to find other sources of funding, but due to their poor credit rating and the current recession, this has been impossible. The document itself seems heavily in favour of lending Leeds United the money, or buying the Thorp Arch training complex for the council and taxpayer and leasing it to Leeds United for a reasonable fee. The agreement would include an option for Leeds United to buy the complex from LCC when their finances improve. After listing the facilities of Thorp Arch, the part that will most likely clinch the deal for LUFC is revealed. “Because of the high quality facilities Thorp Arch is highly likely to be used as a Team Base Camp during World Cup 2018, should England secure the nomination to host the event from FIFA, regardless or not of whether Leeds secures Host City status.” The 2018 World Cup bid and Leeds’ chances of securing host city status are constantly pointed to from here on in, including point III of the following, which is a list of reasons why LCC should back Leeds United FC. (i) A strong Leeds United has been shown to assist Leeds in its quest to be viewed as a major European city. (ii) The Club receives little national television coverage now that it is in League 1 and improved fortunes for the Club would mean more television exposure for the City. (iii) When making its decision about who should host World Cup 2018, FIFA will pay particular attention to the relationship between Clubs and their local authorities. Examples of partnership working to achieve shared goals will be important. (iv) A partnership with the Club may open the way for use of the facilities in association with the 2012 Olympics and the 2015 Rugby Union World Cup. (v) The Thorp Arch facility is a truly exceptional sporting asset for the City. If the option to acquire is not exercised before October 2009 then at the end of the Club’s lease in 2029 there can be no guarantees that future planning regulations would protect its use for sport, and the facility could be lost to the City. (vi) During the current recession, and at a time when the community look to the Council to stimulate the economy, a partnership with Leeds United would send a strong message that the Council is taking a pro-active role in seeking to arrest the downturn. The whole thing is currently undergoing risk assessment, although the LCC seems in favour of helping Leeds United if only to help themselves in the 2018 World Cup bid. There seems to be two main options for helping the club, one of which would be to lend Leeds United the money, which carries a certain amount of risk given Leeds’ history of financial mismanagement and is unlikely to be the chosen option. The other option is to buy Thorp Arch on Leeds United’s behalf and rent it back to them. This seems to be the more sensible option and the one most likely to be chosen. If LCC became the new owners of Thorp Arch then their money is safe as they’ll own a complex worth more than the initial funds paid. Leeds United will maintain exclusive use of the complex and continue to run the facilities, whilst also maintaining an option to buy the complex back from LCC when finances improve. The 2018 WC team see the relationship between Leeds United and LCC blossoming and everyone’s a winner. I read the document in question last night and although I was on a high from the Walsall game, had I written about it then this would most likely be a scathing attack on Ken Bates with me constantly questioning where the money has gone. Even the most naïve of Leeds United fans can’t possibly think the club isn’t leaking money somewhere. Look at the attendance for Exeter and the price of tickets, not to mention the compensation we’ve had awarded in our favour from youth players, the transfer fees received and total lack of spending. I know Fab’s transfer was on instalments, but there’ll have been a sizeable percentage of that paid upfront. I’m going to ignore the disappearing funds though and look at this from another point of view. The chances are that LCC will be the ones that own Thorp Arch by the 10th of October and this can not be a bad thing. The council has vested interests in Leeds United (as highlighted above) and they only want the team to succeed. They’re not going to extort ridiculous amounts of cash from us, nor will they do anything that could harm the team. Finally, if the council own Thorp Arch then it adds security to Leeds United as the premises are secure. It also adds transparency as the fans and any potential investors know who owns it. This can only be a good thing.