HOW NOT TO WIN FRIENDS AND INFLUENCE PEOPLE

Robin Brownlee
September 25 2012 10:07PM

Edmonton Oilers owner Daryl Katz doesn't give a crap about what people think about him. He's a billionaire. A BILLIONAIRE. I laughed out loud when I read a comment to that effect on Twitter last night. Alas, it's true.

As any all-about-the-number girl will tell you, there is no such thing as a millionaire who is ugly or fat or short or bald or who smells bad. Pick any deficiency you'd like, a big stack has it covered. Having never dropped my panties for a greasy, stubby-fingered troll with a thick wallet and a black card, I can only assume the same holds true, squared, for a billionaire.

Even allowing for that, the reality that monied people play by different rules than the rest of us do, Katz hasn't done himself or his efforts to strike a deal for a new downtown arena for the Oilers any favors with the way he's gone about his business since doling out cheques to the EIG to buy the team.

In fact, Katz couldn't have done a worse job of PR, of selling himself and his vision to the citizens and hockey fans of this city, if he tried. His latest gaffe, a stunt in which he showed up in Seattle with Kevin Lowe, Patrick LaForge and Wayne Gretzky in tow Monday – Katz can find his way to Washington but he can't or won't drive across town to meet with city council – was a not so subtle attempt to put a gun to the collective head of this city.

Whether Katz realizes it or not – he might be so detached from the hockey fans of Edmonton (he used to be one) that he doesn't care – what he actually did with that ill-advised photo-op in Seattle was stick the barrel of that one-shot gun in his own mouth. If Katz doesn't change his approach, and soon, if he doesn't figure out he's alienating huge segments of a fan base that is, or at least was, dying for a reason to get behind him, he might as well pull the trigger.

HAM-HANDED APPROACH

Jason Gregor wrote an insightful piece today about Katz's charade in Seattle and the implied threat that comes with it. While I don't discount the possibility the Oilers could move if Katz doesn’t get the deal he wants – I wrote about it here – I'm also of the mind he's looking for leverage to get a deal here. That's understandable. It's his method I can't, for the life of me, make any sense of.

Think back just five years ago, before Katz started cutting cheques to Cal Nichols and Bruce Saville and the rest of the EIG. Could there possibility be a better situation, more of an absolute godsend, for Edmonton hockey fans than having a local boy made good, a billionaire no less, ride to the rescue with his cheque book in hand? An Edmontonian. A billionaire who grew up watching the Boys on the Bus. How do you screw that up? Let us count the ways.

When Katz took over the Oilers he had a city full of hockey fans just waiting to get onside with him. He hasn’t fostered that. He hasn't talked to the people who buy tickets to watch his team play, who buy the jerseys – the same people who'd be lobbying their city councillors to stop dragging their feet and get this arena deal done now if he'd made even the slightest effort.

Is Katz frustrated at how this project has dragged on for years? Sure he is, and he should be. But he's had a big hand in that, both in the business end of the deal behind closed doors and publicly by way of his astounding inability and apparent unwillingness to at least attempt to get a passionate fan base lined up behind him. How tough, in this town, is that?

Instead of going that way, Katz pulls a page out of Peter Pocklington's Shit Show Negotiating book and rolls into Seattle. Now, he's got mayor Stephen Mandel declaring a deadline of Oct. 17 to get back before council. This arena project should have been a slam-dunk. It's anything but that now.

It should never have come to this, but here we are.

Listen to Robin Brownlee Wednesdays and Thursdays from 3 p.m. to 5 p.m. on the Jason Gregor Show on TEAM 1260.

Aceb4a1816f5fa09879a023b07d1a9b4
A sports writer since 1983, including stints at The Edmonton Journal and The Sun 1989-2007, I happily co-host the Jason Gregor Show on TSN 1260 twice a week and write when so inclined. Have the best damn lawn on the internet. Most important, I am Sam's dad. Follow me on Twitter at Robin_Brownlee. Or don't.
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#51 Rick
September 26 2012, 12:09PM
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@David S

No it's not, the estimated $2 billion is the added value of the tax revenue in the whole CRL area, not just the development.

The development may spur an acceleration of that Tax revenue but it isn't a case of if it will or will not happen as a result of the arena development.

It could just as easily be argued that with out the arena the CRL area wouldn't be leveraged against the arena debt and because of that there would actually be even more money for pothole repair, bike paths and green spaces.

Of course the trade off is the amount of time it takes for it to take off.

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#52 jr_christ
September 26 2012, 12:11PM
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Hot shot billionaire nice guy turned evil... never saw this one coming. I lived in Edmonton as a neighbour to Darryl's mom and dad. I still remember the conversation where his dad told me "now now, young man. It isn't appropriate for you to call me Max... the correct way to address me would be Mr. Katz".

One thanksgiving dinner Margret and Max had us over and I asked why he didn't have his son (whom he rarely spoke about) over for dinner. Mr. Katz, as it were, told me he had a huge falling out with his son after he graduated with his law degree and sought out an entreprenurial role in pharmacuticals. It seems this family line doesn't play normal ball... so I wouldn't be surprised if Darryl ended up taking this team out of the city because he had a "falling out with the city"

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#53 Next up, is Connor McJesus.
September 26 2012, 12:19PM
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@Truth

The City aren't the ones with their hand out on this venture.

The same "revitalization" expectations came with the Coliseum in 1975. What happened there, was it the decision to put locks on all the doors....a failure to learn Quicken?

Same ship, different yr for this new facility, or will this finally be the elysium project we hoped we were getting in 1975? Not likely.

Katz is in it to revitalize himself, not the downtown core. His actions during these proceedings appears to be more of helping himself to Edmonton rather than helping Edmonton. There's a big difference between the two.

CRL revenues are only hopeful numbers to be parked right along side the hopes of revitalization. Since we're paying for it anyways, why not own the hope/profits rather than give it to Katz.

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#54 David S
September 26 2012, 12:45PM
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Rick wrote:

No it's not, the estimated $2 billion is the added value of the tax revenue in the whole CRL area, not just the development.

The development may spur an acceleration of that Tax revenue but it isn't a case of if it will or will not happen as a result of the arena development.

It could just as easily be argued that with out the arena the CRL area wouldn't be leveraged against the arena debt and because of that there would actually be even more money for pothole repair, bike paths and green spaces.

Of course the trade off is the amount of time it takes for it to take off.

The DBA report on the tax revenue potential specificaly mentioned that the arena district would be the primary catalyst for most of the development within the CRL boundaries. Seriously, I'm not making this stuff up.

No Oilers, no arena. No arena, no arena district. No arena district, no ancillary development. No ancillary develoment, no tax revenue.

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#55 David S
September 26 2012, 12:51PM
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Next up, is Connor McJesus. wrote:

The City aren't the ones with their hand out on this venture.

The same "revitalization" expectations came with the Coliseum in 1975. What happened there, was it the decision to put locks on all the doors....a failure to learn Quicken?

Same ship, different yr for this new facility, or will this finally be the elysium project we hoped we were getting in 1975? Not likely.

Katz is in it to revitalize himself, not the downtown core. His actions during these proceedings appears to be more of helping himself to Edmonton rather than helping Edmonton. There's a big difference between the two.

CRL revenues are only hopeful numbers to be parked right along side the hopes of revitalization. Since we're paying for it anyways, why not own the hope/profits rather than give it to Katz.

I simply do not care if Katz makes a profit. In fact I sincerely hope he does or this whole thing isn't going anywhere.

What the h3ll is wrong in this city that businessmen making profit is a bad thing? Why can't people see if he profits, we all do?

And for all of you saying "just build it ourselves", well you may as well be buying the Oilers too. Of course the city isn't in the business of pro sports and/or arena management so the liklihood of that happening is pretty much zero.

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#56 Reagan
September 26 2012, 12:56PM
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It really goes to show you how professional and couteous the katz group really is. Makes me wonder if this scharade is really about katz doing his homework on how other business people got the work done correctly...

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#57 Rick
September 26 2012, 01:16PM
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@David S

I didn't think you were making it up.

But I do think you were mistaken is saying that the $2 Billion were coming from that development.

It's not. It's coming from the growth of the surrounding area. How much of that growth can be directly attributed to the arena will be debated for years. Even once there is the benefit of hindsight.

As far as it being a catalyst. I don't disagree but that is a pretty open ended assertion.

I would argue it's a catalyst in terms of how quickly revitalization will be realized. Not that revitalization will live and die with the arena.

And jut to be clear, I am an unabashed arena project booster. I think it's part of a ready made solution to a much more complex issue and will greately benefit the downtown and city as a whole.

However, I also believe that context has to be maintained when discussing what this project will or won't do.

Any suggestion is that the ONLY way a city of 1 million people can turn their downtown into something more desireable is dependant on a hockey rink is about as silly a notion as Katz actually moving the team to Seattle within the next two years.

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#58 vetinari
September 26 2012, 01:41PM
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The issue isn't whether someone should profit from the construction of a new stadium-- that's a moot point-- the issue is whether Katz should be given a more favourable deal by the tax payers to keep the Oilers in Edmonton given that there previously appeared to be a framework for an agreement that all sides could live with.

What is frustrating is this:

Katz wants more money and concessions from the public under threat of moving the Oil when the franchise is already profitable and has been subsidized by the Oiler faithful by nightly sellouts through three losing seasons of 30th, 30th and 29th place overall!

Katz is clearly sending a mixed message to the public-- on the one hand, the Oil is a hockey institution that saw some of the league's best play in their colours for years and that he saved from a cumbersome ownership group, while on the other hand, the Oilers are his personal toy to do with as he pleases which includes moving them out of town if the public doesn't give him more.

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#59 Next up, is Connor McJesus.
September 26 2012, 01:50PM
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@David S

Profits that would belong to the City of Edmonton aren't any less valueable than profits that would line Daryls pockets.

Edmonton is in the arena management business, they're called Northlands. Edmonton Northlands would be capable of running the new building. What's the difference between Katz running the building and Northlands/the City? CRL benifits would still be in play.

This should be the building that Edmonton built, not the building that Katz built. Remove that poser Katz from the equasion, same results.

What's next for this Katz caracter, is he going to be at the doors of ETS wanting 50% of the haul from LRT fares?

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#60 David S
September 26 2012, 02:18PM
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http://blogs.edmontonjournal.com/2012/09/26/city-councillor-prepared-to-look-at-sweetening-arena-deal-for-katz-group-but-only-if-it-can-prove-need/

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#61 David S
September 26 2012, 02:22PM
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Next up, is Connor McJesus. wrote:

Profits that would belong to the City of Edmonton aren't any less valueable than profits that would line Daryls pockets.

Edmonton is in the arena management business, they're called Northlands. Edmonton Northlands would be capable of running the new building. What's the difference between Katz running the building and Northlands/the City? CRL benifits would still be in play.

This should be the building that Edmonton built, not the building that Katz built. Remove that poser Katz from the equasion, same results.

What's next for this Katz caracter, is he going to be at the doors of ETS wanting 50% of the haul from LRT fares?

Katz will NOT deal with Northlands in a lease situation any further than 2014. They have been at extreme odds for years. On top of which a revised version of his current agreement where he doesn't get non HRR will practically ensure he either sells or relocates the team. That arrangement doesn't provide enough operating revenue for the team to be viable (and is the primary motivation for a new arena). Pretty much every other team in the league is not crippled by such an agreement.

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#62 Next up, is Connor McJesus.
September 26 2012, 02:39PM
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David S wrote:

Katz will NOT deal with Northlands in a lease situation any further than 2014. They have been at extreme odds for years. On top of which a revised version of his current agreement where he doesn't get non HRR will practically ensure he either sells or relocates the team. That arrangement doesn't provide enough operating revenue for the team to be viable (and is the primary motivation for a new arena). Pretty much every other team in the league is not crippled by such an agreement.

Don't give him the choice then. He owns a hockey team but he doesn't own this market. If that's the price, then let him move his Oilers to Seattle.

He already had a deal in place last October, now he wants a better deal. Does the guy need some Midol or something? He had a functional agreement that effectively had him in control of this building. Within 15 yrs, he won't have a nickel of his own money tied up in this facility, yet he'll still control the profits off the backs of us the taxpayers.

I'm all for the new arena David, but please, don't be handing out dunce caps to all Edmonton residents. It's obvious we're just a bunch of sheep according to Katz. Why the need to do this deal with Daryl, when we can own it, we're paying for it anyways.

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#63 OB1 Team Yakopov - F.S.T.N.F
September 26 2012, 02:43PM
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Next up, is Connor McJesus. wrote:

Deep Oils take has merit. Many people act based on needs. He's financing 100% of his investment into this facility. I think even i mentioned a couple yrs ago, Katz was needing to fast track this project because his resources were dwindling.

Revitalize downtown my arse, Katz wants the keys to this facilty to revitalize his own finacial interest.

No, it doesn't have merit.

Just because you are rich doesn't mean you pay cash for everything (especially in a low rate enviroment).

Leverage is a useful tool that many ultra high net worth take advantage of.

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#64 KenL
September 26 2012, 02:53PM
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A caller on Stauffer's show today provided some insight which I haven't heard before. The optics of the new $6M annual operating cost subsidy makes it look like Katz is contributing nothing in the project, since his $100M investment would be repaid over 30 years in annual $5M installments. On the surface, it looks like Katz is pocketing an additional $1M annually.

What the caller pointed out was that the $6M is not an automatic annual cheque. Rather it only kicks in should the Katz group not generate enough revenue to cover operating costs, and is up to a maximum of $6M. Presumably if Katz group is $2M in the hole one year, the city would cut a cheque for $2M. Katz would still pay his annual $5M to cover his share of construction costs.

If this is what has actually been proposed - why the hell hasn't this been communicated by both camps??? While this still makes Katz look like a welcher on the original Oct agreement, I think it would be more palatable and provides room for both sides to meet in the middle. As an example, the City could ask for repayment of the subsidy in years when the Oilers have a large profit.

Bottom line, if Katz would make more of an effort to speak to Edmontonians (Oiler fans or not) who ultimately are footing the bill for the bulk of the construction costs, rather than pulling off a d-bag move like going to Seattle - the temperature of this debate wouldn't be so intense.

I've been a supporter of the arena project from day 1. But I'm having a hell of a time defending it today.

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#65 Next up, is Connor McJesus.
September 26 2012, 03:29PM
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@KenL

He had a more than fair deal a yr ago. Now he's picking up some sheep ship and rubbing it in our faces.

Distancing himself from any and all finacial risk. He's running an NHL hockey team in Canada, how much risk can there be?

Him pulling this Seattle tactic just confirms he has little respect for Edmonton hockey fans, he's vulnerable now and have to think the finacial ground under his feet is shrinking. Finacially he's nothing without the benifit of Edmonton taxpayers paying the full freight on this project.

Enjoy this control over him while the taxpayers still have it. When he gets what he wants, he won't give hockey fans the time of day.

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#66 Reg Dunlop
September 26 2012, 04:11PM
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@Next up, is Connor McJesus.

Actually, when Katz gets what he wants he will give Edmontonians plenty; a cap-floor 30th place team and yearly threats to move the oil when he wants more. Hey Daryl, Pocklington thinks you're acting like a douche.

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#67 The Soup Fascist
September 26 2012, 05:12PM
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Next up, is Connor McJesus. wrote:

Profits that would belong to the City of Edmonton aren't any less valueable than profits that would line Daryls pockets.

Edmonton is in the arena management business, they're called Northlands. Edmonton Northlands would be capable of running the new building. What's the difference between Katz running the building and Northlands/the City? CRL benifits would still be in play.

This should be the building that Edmonton built, not the building that Katz built. Remove that poser Katz from the equasion, same results.

What's next for this Katz caracter, is he going to be at the doors of ETS wanting 50% of the haul from LRT fares?

Northlands was and continues to be a pretty nice "old boys club". The many perks include, but are not limited to, a complimentary luxury box for all events at Rexall, including Oilers Games.

Northlands receives a pretty lucrative and "unique" deal from the Casino on their premises. As David Staples indicated in his excellent March 2010 article "Who is Northlands" the "take" shakes down as follows:

"....15 per cent to the operator (Northlands), 33.3 per cent to the province’s general lottery fund, and 51.3 per cent to the Horse Racing Breeding and Renewal program."

Now I am not sure what the Horse Racing Breeding and Renewal Program is, but I am guessing a large part of the very large pie ends up back in Northlands coffers, one way or another.

According to Northlands 2011 Annual Report, ALGC gaming proceeds generated on Northlands behalf were $29.6 million. Yikes. Katz is looking for $6 million to offset the casino revenues that the City of Edmonton was allegedly going to help secure - but failed to.

Also not mentioned is the $2.5 million "money for nothing" allowance paid by City taxpayers to Northlands to offset revenues they feel they deserved from the Oilers. This is yours and my money that gets paid year after year - hush money, nothing more.

Yes please, let's get Northlands involved.

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#68 Next up, is Connor McJesus.
September 26 2012, 05:54PM
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@The Soup Fascist

....and the Katz group promises to be much more efficient, Soupy?

What did Katz blow on his Monday trip down to Seattle, a hundred and fifty G to "check out" possible Oiler interests. That was certainly well spent season ticket holder monies. How is he going to be any more responsible than Northlands?

Pot, meet Kettle?

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#69 The Soup Fascist
September 26 2012, 06:18PM
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But you are mixing a private enterprise and a "not for profit" board.

I don't care what Katz does with his money - as long as he pays the players. My only point is the perception that Northlands is this group of altruistic folks who are just looking after our interests does not ring true with me.

Northlands at it's peak had 50 board members. 50! I work for a company with $30 billion market cap. Nine members on the BOD.

Look. Katz is what he is - a businessman who makes sure he gets his. I deplore his latest caper, The Pike Street Gambit. Unnecessary and dumb. But a deal is there. After 4 years of navel gazing we need to move forward. And Northlands would serve as nothing more than a middle man with another open palm extended. What do they bring to the party?

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#70 Next up, is Connor McJesus.
September 26 2012, 07:12PM
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With Katz turning up the heat for all involved, there's little that can be done now to prevent him from getting everything he wants.

It's too bad this deal couldn't fall into the lap of the EIG. Seems as though Daryls turned out to be a little on the arrogant side/douche.

EIG would have been more deserving of a deal like Katz is getting.

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#71 David S
September 26 2012, 07:32PM
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Next up, is Connor McJesus. wrote:

With Katz turning up the heat for all involved, there's little that can be done now to prevent him from getting everything he wants.

It's too bad this deal couldn't fall into the lap of the EIG. Seems as though Daryls turned out to be a little on the arrogant side/douche.

EIG would have been more deserving of a deal like Katz is getting.

You should listen to Bruce Saville's interview on Oilers Now. The EIG would not have been able to float this deal.

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#72 David S
September 26 2012, 07:35PM
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The Soup Fascist wrote:

But you are mixing a private enterprise and a "not for profit" board.

I don't care what Katz does with his money - as long as he pays the players. My only point is the perception that Northlands is this group of altruistic folks who are just looking after our interests does not ring true with me.

Northlands at it's peak had 50 board members. 50! I work for a company with $30 billion market cap. Nine members on the BOD.

Look. Katz is what he is - a businessman who makes sure he gets his. I deplore his latest caper, The Pike Street Gambit. Unnecessary and dumb. But a deal is there. After 4 years of navel gazing we need to move forward. And Northlands would serve as nothing more than a middle man with another open palm extended. What do they bring to the party?

This is true. I've had dealings with them. They get away with alot under the guise of "not for profit". All the while charging you $12 bucks to walk a solid kilometer from their crappy parking lot to RX1 when it's -40C.

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#73 Next up, is Connor McJesus.
September 26 2012, 07:53PM
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David S wrote:

You should listen to Bruce Saville's interview on Oilers Now. The EIG would not have been able to float this deal.

You and i could make this work if we were getting the same deal Katz will finally get David.

I'll open (am shift), you close (pm shift)....deal?

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#74 Walter Sobchak
September 26 2012, 09:45PM
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@David S

Just a "keep your head up” sincere prop here, it’s hard to argue facts and points to emotional or upset masses, even worse when the comments are grossly inaccurate.

Your take on this matter is spot on and I choose not to comment cause you sir are extremely well informed and are presenting the argument that I no longer have the stomach for.

Good Day Mr. S.

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#75 Not A Northlands Fan
September 26 2012, 10:07PM
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Having lived in Edmonton for 60 years and growing up where right beside the "Edmonton Exhibition " grounds . I always felt that the EXA (Northlands) was a complete old boys club. From summer jobs on down nepotism was the rule. I see no reason for this organization to exist and all their assets should be returned to the City to be consolidated with other similar assets. For Rexall place to compete with the new arena is beyond strange.

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#76 Not A Northlands Fan
September 26 2012, 10:14PM
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KenL wrote:

A caller on Stauffer's show today provided some insight which I haven't heard before. The optics of the new $6M annual operating cost subsidy makes it look like Katz is contributing nothing in the project, since his $100M investment would be repaid over 30 years in annual $5M installments. On the surface, it looks like Katz is pocketing an additional $1M annually.

What the caller pointed out was that the $6M is not an automatic annual cheque. Rather it only kicks in should the Katz group not generate enough revenue to cover operating costs, and is up to a maximum of $6M. Presumably if Katz group is $2M in the hole one year, the city would cut a cheque for $2M. Katz would still pay his annual $5M to cover his share of construction costs.

If this is what has actually been proposed - why the hell hasn't this been communicated by both camps??? While this still makes Katz look like a welcher on the original Oct agreement, I think it would be more palatable and provides room for both sides to meet in the middle. As an example, the City could ask for repayment of the subsidy in years when the Oilers have a large profit.

Bottom line, if Katz would make more of an effort to speak to Edmontonians (Oiler fans or not) who ultimately are footing the bill for the bulk of the construction costs, rather than pulling off a d-bag move like going to Seattle - the temperature of this debate wouldn't be so intense.

I've been a supporter of the arena project from day 1. But I'm having a hell of a time defending it today.

With management fees , royalty fees etc etc there is no way the company that is entitled to the subsidy will be in a profit position. If company A can get a 6 million dollar subsidy, they will transfer out revenue and load in expenses so that a loss is guaranteed. The city should do their own due diligence and base the subsidy on tickets sold or some other accountable standard.

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#77 Mitch
September 26 2012, 11:46PM
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@Brownlee Katz has more money than anyone could ever need. What bothers me is this, he's a very successful person and in order to become a billionaire you probably have to be a extremely good communicator. I don't understand how a person that owns the most recognizable brand in the city and has the most benefit to gain acts like he don't really care and most importantly wont talk and does not even want to be heard from unless it is to his and only his liking.

Katz made the biggest of mistakes by having his people issue a statement, this statement is of total ignorance and arrogance. I hope the people of Edmonton are past the relocation threats this team always seem to be associated with, I know I'am.

Personally I don't wish Darryl any success. If he don't like owning the Oilers because they aren't profitable sell the team no one held a gun to his head and said buy this team.

For Katz it's all about building a brand and having control.

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#78 pelhem grenville
September 27 2012, 07:13AM
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...i kept looking at the lead picture and it finally dawned on me ... "Dog&Pony Show" ! ! !

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#79 Morgie99
September 27 2012, 06:53PM
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David S wrote:

This is true. I've had dealings with them. They get away with alot under the guise of "not for profit". All the while charging you $12 bucks to walk a solid kilometer from their crappy parking lot to RX1 when it's -40C.

Ya, I'm sure if Katz owned the parking lot he'd charge less? Ya right

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