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MacHale Park loan restructured

Sport

PROPOSAL Mayo GAA Board Chairman Liam Moffatt. Pic: Sportsfile

Repayments to cost Mayo GAA €20k per month for 2022

Mike Finnerty

MAYO GAA’s monthly repayments to Croke Park on the MacHale Park redevelopment loan are to be reduced by almost €14,000 per month for the next 12 months after a proposal from chairman Liam Moffatt, on behalf of the County Board executive, was passed by club delegates last week.
The decision was taken at the monthly County Board meeting after Moffatt outlined an offer from the GAA’s National Finance Committee to reduce Mayo’s monthly repayments from €34,100 per month to the 50-year repayment rate of €20,552 per month.
The decision to accept the proposal for a 12-month period was described as a ‘no-brainer’ by both South Mayo Board secretary, Brian O’Malley from The Neale, and Mayo Gaels club delegate, Dermot Flaherty.
There is currently €7.9m owed to Croke Park in loan repayments by Mayo GAA; the repayments were reduced to €5,000 per month shortly after the pandemic struck last year.
However, this ‘moratorium’ will now be replaced by the new agreement for the next 12 months. It will then be discussed and reviewed by the National Finance Committee, as well as Mayo GAA officials and club delegates.
Liam Moffatt outlined Mayo GAA’s current position at the outset of a lengthy discussion that saw a dozen different speakers contribute.
“To develop MacHale Park into the great facility it is today, significant investment is required and, unfortunately, it has led to significant cash flow pressures on Mayo GAA and its volunteer administrators,” said the chairman.
“So there is an option now to extend the term of the loan, and ease cash flow pressures.
“At the moment, Mayo’s loan currently stands at: €7.9m,” he continued.
“The monthly repayments have been €34,100 which equates to €409,000 annually.
“As you know, from last year we put that back to €5,000 a month, we essentially got a moratorium on the payment. That €5,000 a month wasn’t even covering the interest. So when you include the interest to it, it brings the current amount outstanding to €7,956,000.
“If you were to look at that figure, and work off a monthly base rate, and you were to pay that loan off in 20 years, it would amount to just short of €40,000 a month.
“If you were to pay it off in 30 years, it would amount to around €30,000 a month.
“In 35 years, €26,000 a month; 40 years, €23,000 a month; 50 years, €20,552 a month.
“So as a result of conversations with the Finance Committee, a proposal [has been made] to restructure the loan repayment from €34,100 a month to €20,552 per month with a review of this position by the National Finance Committee in 12 months’ time, pending the infrastructural work that’s required in the stadium.
“Annually, that would equate to €246,600 as opposed to previously, €409,000, a 40% difference. So the proposal from me, via Coiste Bainisti is: to go with the reduced payment at the 50-year rate of €20,552. And then review it.”
In response to a query from Kevin McDonnell of Kilmaine, the chairman confirmed that extending the term of the loan would mean the total cost would rise to ‘€10.6m, were the 50-year agreement to remain in place beyond the next 12 months’.
However, the interest rate would stay at 1.9%.
“You have to support your county teams and create cash flow breathing space in the next 12 months,” commented Liam Moffatt.
“The €34,000 is a burden we just can’t afford to carry at the moment,” added Con Moynihan, vice-chairman of the County Board. “We have to remember that this is a National Club Fund [the source of Mayo GAA’s loan] that’s used by Croke Park to fund every other club and every other loan that goes out around the country.
“We won’t get this sort of offer or rate from any bank. It lessens the burden and in 12 months’ time if our finances are still in the same structure, with the same governance, we will be in a position then to look at what we’ll do going forward.”
“This is probably the first time that we’ve seen some movement from Croke Park in terms of giving us some relief on the loan,” said Michael Diskin, Mayo GAA’s assistant treasurer. “We’re talking about the burden that €34,100 a month has placed on the County Board and this is a significant move.
“Whether we decide it’s for 20 years or 50 years, I think, is a decision for 12 month’s time.
“This move by Croke Park represents a recognition of the problems that Liam [Moffatt], and others, have spoken to Croke Park about in relation to the cost of the stadium payments.”
Mayo Gaels delegate Dermot Flaherty commended the officers for re-negotiating the terms of the loan with Croke Park and said: “I think it’s a huge vote of confidence in the way ye have got the house in order, financially. It’s a 12-month commitment we’re making on this, to me it’s a no-brainer. We can come back to it again in 12 months’ time.”
Kilmaine delegate Kevin McDonnell then referenced the role played by the previous Mayo GAA chairman, Mike Connelly, in making ‘significant changes to the loan agreement in terms of bringing it all in under one umbrella instead of having bank loans and Croke Park loans’.
“A lot of money was reduced at the time and a lot of money was saved to the County Board,” said McDonnell. “He did tremendous work and this is a further step along the line.”
“I’d second that point,” replied Liam Moffatt. “Mike, and people with him, did great work at that time and we’re building on that work here now.”
Mayo GAA’s development officer, Mary Prenty, also addressed some delegates’ concerns about the cost of the loan interest over a 50-year term.
“If we can turn around a profit again next year, and if all goes well with Covid, we’ll have league games, championship games, an increase in our Cúl Camps, and maybe a better interest in our Club Development Draw. . .
“I’d be saying that the treasurer, Valerie [Murphy], has done such a great job that surely she can make a recommendation next year and say, ‘Listen, we can take €50,000 or €100,000 and put it in as a lump sum into the loan and reduce the capital that way’.”
The proposal was officially proposed by Liam Moffatt, on behalf of Coiste Bainisti, and seconded by Kevin McDonnell of Kilmaine.

KEY NUMBER
€7.9m
THE amount Mayo GAA currently owes to Croke Park on the MacHale Park redevelopment loan.

 

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