February 09, 2012
My bedroom closet proposed as Vikings stadium site
It's official. The Minnesota Vikings stadium battle has crossed the line into farce:
State Sen. Roger Reinert is throwing a fourth-down Hail Mary pass with just seconds left on the clock today as he sends Gov. Mark Dayton a letter suggesting a new Minnesota Vikings football stadium be built in Duluth.
Reinert, DFL-Duluth, acknowledges his chances are about the same as the Vikings chances to win the Super Bowl anytime soon — between slim and none — but said the lack of consensus for any Twin Cities stadium site spurred his action.
There's no indication that Reinert is serious — he actually told the Duluth News Tribune, "If all this does is enhance Duluth as a prime [tourist] destination, then I’m fine with that," which seems about as likely as it getting a Vikings stadium — but still, this means that people are now approaching the Vikings stadium situation solely as a way to get their names in the paper. As if this weren't already enough evidence of that.
So, what the hell: I have a pretty big walk-in bedroom closet. I hereby offer to build a $1 billion NFL-ready stadium in it for the Vikings, funded via a public-private partnership. (Public and private partners yet to be determined.) It already comes with a roof, so that's taken care of, and thanks to expected advances in wormhole technology, it will be at least as accessible to Vikings fans from throughout Minnesota as Duluth is. This promises to be just the economic shot in the arm that Minnesota (and my closet) needed — especially if the state is willing to offer tax subsidies to become the site of the wormhole manufacturing facility.
Sacramento rejects arena funding referendum, and other Kings news
Much minor news in the ongoing Sacramento Kings arena drama:
- The Sacramento city council voted Tuesday on a bill to put to a public vote its plan to sell future parking revenues to pay for an arena ... and rejected it, 5-4. Still, the fact that it even came close to passage is being touted as an indication that the council could drive a hard bargain on the parking deal, or something.
- AEG is reportedly looking for a similar deal to what it got in Kansas City in exchange for kicking in money toward a Kings arena. Local news station KXTV says that this would mean AEG would put in about $50 million, leaving the Kings owners to contribute $80 million. The city, meanwhile, would still be on the hook for at least $270 million, which — if AEG gets the same kind of guaranteed profits and high rate of return that it did in K.C. — sounds like a great deal for the arena manager, and no real help in filling the public funding gap.
- Anaheim Ducks owner Henry Samueli broke ground on $20 million in improvements to the Honda Center, promised last year in an attempt to lure the Kings south. Actually, last year he promised $70 million, but what's $50 million among friends?
- Those imminent plans for an arena in Seattle may not actually be that imminent after all. I know, shocker, right?
As the March 1 NBA deadline for the Kings to announce their intent to relocate approaches, it's important to keep in mind that nothing really matters here other than what owners Joe and Gavin Maloof think has the best chance of making them the most money: If they think there's hope of getting a windfall in Sacramento, they'll likely wait and see what shakes out. Given that the alternatives right now are an Anaheim offer that the rest of the league hates and which includes giving Samueli much of their TV money, and a Seattle plan that's even less far along than the current Sacramento one, and I'd be stunned if the Maloofs don't stick around to see what they can get out of Sacramento ... or at least ask for another one of those extensions that the NBA hands out like candy.
Browns: We built selves restaurant, we deserve public money
Mark Naymik has a column in today's Cleveland Plain Dealer detailing the claims the Cleveland Browns owners used about how much money they've put into renovating their stadium in order to talk the city council into giving them $5.8 million in public cash. And the list is pretty impressive, though probably not in the way the Browns owners hoped:
The team said it spent $50 million on stadium repairs and improvements it wasn't required to spend.
That's a good chunk of money, for sure. The figure, however, is a bit misleading. It includes escalators that were installed when the stadium was built. This amenity was an upgrade the team's late owner believed was necessary to attract fans. The figure also includes a restaurant at the stadium, which generates profits for the Browns.
The Browns also counted sales and tickets taxes paid by fans ($35 million since 1999), team income taxes ($6.2 million) and its elecric bill ($24 million), leading city councilmember Mike Polensek to snort, "I'm glad you pay utilities and taxes like most other businesses." (It's also worth noting that these are agressively feeble numbers for a team paying only $250,000 a year in rent on a stadium it got for free, and casts even more doubt on some of the wilder claims of the tax benefits of having a team in your city.)
The real news here, as Naymik notes, is that the Browns are looking to get the city's sin tax extended beyond 2015, and "there's growing chatter that the Browns will join forces with the Indians and Cavaliers -- whose facilities are 20 years old and in need of upgrades -- to mount a campaign" to extend it. Which should answer anyone wondering what the shelf life is of modern stadiums: until the teams can gather the chutzpah to ask for new (or improved) ones.
February 07, 2012
Cleveland gives Browns another $5.8m for stadium
Somebody on Twitter already beat me to the good headline, so I'll have to settle for a straight lede: The Cleveland city council has just approved spending $5.8 million on repairs to the Browns' 12-year-old stadium, over and above the $850,000 a year it's required to spend on major improvements.
Why? The article in the Cleveland Plain Dealer doesn't exactly say, except that the stadium needed waterproofing after some rough winter. "When you own a building and a few years go by, it starts to develop needs," Mayor Frank Jackson's chief of staff, Ken Silliman, told the council. It's not clear, though, who's required in the team's lease to actually pay for this stuff.
The stadium maintenance issue is likely to come to a head in the near future, as the "sin tax" on alcohol and cigaretttes that is used to pay for upkeep (and was used to pay for construction costs on both the Browns stadium and the Indians' and Cavaliers' facilities) is set to expire in 2015, and the Indians, at least, are already jonesing for upgrades. One Cleveland councilmember has already predicted that voters will be asked to extend the sin tax beyond that year. Truly, stadiums are the gift that keeps on giving.
Just how godawful would Edmonton's Oilers arena subsidy be?
Former Edmonton mayor Cec Purves lashed out at the city's proposes arena deal for the Oilers yesterday, calling it a "sweetheart deal" that would provide a $1.5 billion gift to team owner Daryl Katz and "make Edmonton the laughingstock of the country."
That price tag is probably high — it looks like Purves added up the value of using the arena for 35 year, plus interest and the increased value of the team, without taking into account that future money ins't worth as much as money right now. (And no, not because of inflation. Because money earns interest. In normal times, anyway.) Still, even converting to present value would indicate a subsidy windfall in the hundreds of millions of dollars, which is roughly what I was figuring already.
In any event, the Oilers arena plan remains on hold while the city waits patiently for the province to fill in the last $100 million in missing funding, something Alberta's premier swears she's not going to do. Which is, really, the main reason to be interested in Purves' statement: While in the end it may not matter what a former mayor thinks, having "$1.5 billion" and "laughingstock" in the newspaper alongside your arena plan is never a good way of winning over elected officials.
February 06, 2012
Seattle rich guy wants to build arena, presumably not with own money
Talk about a new arena in Seattle has been fairly quiet since the Sonics left, at least in public. But behind the scenes, according to an investigation by the Seattle Times, the mayor's office has been talking to a local hedge fund manager about building a new arena to lure teams, possibly targeting the Sacramento Kings or Phoenix Coyotes:
In an initial email laying out his vision, [Christopher] Hansen told city officials an arena could be built with minimal impact on taxpayers...
"I really appreciate it and look forward to making this happen in Seattle," wrote Hansen, a multimillionaire who built a fortune in the private investment world. "I genuinely mean that and am confident that with a little effort and creativity we can find a solution that meets our needs and the City's /State's desire to get a team back to Seattle without a large public outlay."
Hansen offered to provide information on "recent municipal arena deals that have been put together and some of the direct and indirect contributions that the city can make that don't require incremental taxes or direct public funding."
There's the catch: How on earth to raise the cash (the Times article doesn't say, but $400 million is a decent starting point) to build a new arena without charging teams such a high rent that they have no interest in relocating there. Seattle voters approved a referendum in 2006 that requires that the city get a positive return on any investment in a sports facility. The Times speculates that possibilities could include kicking back ticket taxes to pay off arena costs (which could still violate the 2006 law, since the money would be cannibilized from existing local spending) or "increased tax collections tied to a boost in Sodo property values," which is pretty much the definition of "incremental taxes," unless Hansen means something else by that term.
Reading between the lines here, it looks as if Hansen is going to try to find a loophole in the "return on investment" clause in the 2006 law, by claiming that the tax revenues being kicked back to the arena wouldn't exist without it. That's generally a pretty lousy economic argument, but given that this would likely be decided in a court of law, not a court of economics, Hansen might have a chance at pulling it off. And at the very least, it let him get his name in the paper.
Meanwhile, talk of the Kings having another relocation option is likely to heat up talks by Sacramento to sell off their future parking revenues to pay for a new arena there. Not that that has a great shot of success either — while plenty of bidders are interested, it would blow a $9 million a year hole in the city budget that would presumably have to be filled before the plan could go forward — but in the arena game, much of the time it's about throwing as much stuff against the wall as possible, figuring that eventually something will stick.
Yet another Vikings stadium plan imminent?
It looks like the Minnesota state stadium negotiator Ted Mondale is going to introduce yet another Vikings stadium plan, this one at the near-the-Metrodome-site-but-not-on-it location that was first floated last week. Mondale says he could issue a new plan this week, and Minneapolis Mayor R.T. Rybak says to expect a "major announcement" today.
Not building on the Metrodome site would allow the Vikings to keep playing there until the new stadium was ready, which would certainly please the team. Before anyone gets too excited, though, this new site has the same funding problems as the other Minneapolis proposals, and stadium proponent But Rep. Morrie Lanning told Minnesota Public Radio that issues like needed road rerouting could make it infeasible anyway: "Initial readings are that the obstacles there are so great that there's no chance of that getting put together before very long." Still, if you can't have quality ideas, quantity is the next best thing, right?
Super Bowl spawns stadium stories
The weekend of the Super Bowl — I understand that some team won by a guy accidentally falling on his butt for a touchdown, which is truly the greatest sports moment ever — brought with it a plethora of stadium stories at least tenuously connected to the big game. My personal favorite is the one about how nice the weather would be at the Super Bowl in New Jersey if only it were now instead of two years from now, but other highlights include:
- A Bloomberg News editorial noting that data show that public stadium financing almost never generates worthwhile economic benefits (complete with lots of links to actual studies), and arguing that "teams should shoulder the heaviest financial burden in any deal" and the public should be fully informed of the costs and benefits before voting on stadium subsidies.
- This followed on a Bloomberg article looking at how the Super Bowl probably won't do much for Indianapolis, despite the city trying to use the occasion to declare itself the "Epicenter of Awesome."
- An International Business Times article running down a bunch of random facts about random sports stadiums (most of them not even football stadiums), and illustrated with a photo of the old Yankee Stadium that it calls the new Yankee Stadium.
- Many, many articles about how Indianpolis is now the epicenter of awesome.
On balance, it was a pretty good run of pieces — at least it's better than regurgitating unsubstantiated claims about how much big sporting events bring to the local economy — even if we likely only got it because of Super Bowl-related search-engine-grubbing. Not that I'd know anything about that.
February 03, 2012
49ers get $200m in NFL stadium funds they've been expecting since December
The NFL upped the ante on its aid to the San Francisco 49ers stadium in Santa Clara yesterday, increasing its offer of G-4 loans (which are really grants, since the recipients can "repay" them with other teams' money) from $150 million to $200 million. This was immediately reported as a huge boost to the Santa Clara project, with the San Francisco Chronicle blogging: "The move from Candlestick to Santa Clara became less of a mirage. Long Sundays on 101 became more of a reality."
Except that we already knew that G-4 loans were being increased to $200 million, and that the 49ers were likely first in line to get one. And the stumbling block for the Santa Clara plan at this point isn't so much the 49ers' share of the funds — they were only slated to pay for $150 million of the $1 billion stadium cost up front — but rather the $850 million in loans that the city stadium authority would be taking out for the rest of the construction tab, though I suppose the 49ers owners can use part of this NFL windfall to pay those back, as they've promised they'll do (though there's still much dispute about whether they're contractually bound to do so or not).
So, nothing to see here, move along. The only real news here is going to come not from NFL offices, but from the courts.
Goodell promises 34 NFL teams if L.A. gets one? Not so much
This was a weird news item to wake up to this morning:
Commissioner Roger Goodell says if the NFL puts a team in Los Angeles, it is probable the league would expand to 34 franchises.
Appearing Thursday night on "Costas Live" on NBC Sports Network, Goodell said the league "doesn't want to move any of our teams."
Why, exactly, would Goodell risk blowing the one thing the NFL is getting out of the two as-yet-unworkable L.A. stadium plans — leverage for team owners to threaten their home cities with a move to L.A. — by promising that any teams that move would be replaced with expansion franchises? True, it's not like Vikings fans will be entirely placated by "Don't worry, there'll be two expansion teams, and we'll have first dibs on one," but still it's an odd thing to volunteer on national TV.
Except that's not quite what Goodell said. To the videotape:
Key section:
Costas: Thirty-two seems like the right number for any number of reasons, the right number of teams. So if L.A. is going to get a team, it's going to be a team that will move. ... How likely is it that L.A. has a franchise sometime soon?
Goodell: It's hard, Bob. There's several issues. First you have to have the stadium. We're developing the stadium--
Costas: The city council there has approved the funds recently, right?
Goodell: There's two plans that are developing in Los Angeles, both of which we think have a great deal of potential. But really, we want to keep our teams where they are. That's the dilemma. Because not only do we have to get the stadium in L.A., then we have to find out how to get the team.
Costas: And 33 is unwieldy?
Goodell: You probably wouldn't go to 33. You'd probably go to 34. I would think you would have to do it by two.
In other words, the interpretation here could just as easily have been "Goodell says probably no expansion team for L.A., because you can't add just one." But that doesn't fit as well in the headlines.
February 02, 2012
St. Louis unveils plan for Rams to keep up with Joneses
Yesterday was the deadline in St. Louis' lease with the Rams for the city to come up with a plan for keeping the Edward Jones Dome "top tier," and the St. Louis Convention & Visitors Commission complied, issuing a $124 million proposal that would include: a giant field-spanning scoreboard like Jerry Jones' Dallas Cowboys have; 1,500 new club seats; and a new courtyard next to the dome that would be "almost like tailgating but without the cars," in the words of commission director Kathleen Ratcliffe.
The city would pay for $60 million of the upgrades, with the Rams footing the other $64 million. That's not likely what Rams owner Stan Kroenke was hoping for — in the famous words of Jerry Reinsdorf, "three-thirds/no-thirds is more of what we had in mind" — but if it boosts the Rams' revenue by even a few million dollars a year, it'd be a reasonable investment for the team. Of course, that only matters if Kroenke is thinking in terms of investments, and not "What can I extract from the city via this ridiculous lease that they signed?"
The Associated Press reports that Kroenke now has until March 1 to either accept or reject the offer or make a counterproposal; if no agreement is reached by June 15, the matter goes to arbitration (the AP doesn't say whether it's binding arbitration or not). St. Louis Mayor Francis Slay also promised in a blog post that "new local public dollars spent to make the facility 'top tier' will be subject to the prior vote of the people. If the CVC gets an agreement with the Rams, YOU will get the final say." Which is good, since it's the law and all.
February 01, 2012
Lexington task force proposes $300m rebuild of Rupp, convention center
If you're wondering what's been up with the plans to replace the University of Kentucky's Rupp Arena for these past four years, it's not transmogrified into a plan to renovate Rupp Arena, plus a bunch of other stuff:
The Arena, Arts and Entertainment District Task Force's final report envisions a $250 million to $300 million "transformation" of Lexington Center, including Rupp Arena, the Lexington Convention Center, the Civic Center Shoppes and immediate environs...
If financing is found, phased demolition and construction of the civic center and Rupp Arena could start as early as 2014.
"This important project will require a mix of local, state and private funding for construction," the report said.
The other change since 2007, apparently, is that Lexington is no longer focusing on using a tax increment financing to fund the construction; it can't help that its neighbor Louisville is having such trouble with its own TIF district. TIFs are still on the table, according to the Lexington Herald-Leader, but along with "naming rights of the arena, premium seating, advertising, sponsorships, concert and event promotions, concessions, stock offerings, state road funds, state tourism tax incentives, tax increment financing and new market tax credits."
Needless to say, that's a big mishmosh of arena revenues and public subsidies. Whether this deal makes fiscal sense is going to depend on which items the city and state choose from that menu, assuming they don't decide the whole thing is too rich for their blood.
January 31, 2012
Oakland calls time of death on Victory Court
This just in: Oakland's Victory Court stadium plan for the A's is officially dead, thanks to the demise of the state redevelopment agencies that would have funded it. But you knew that already.
We now return you to your regular programming.
Minnesota pushing e-pulltabs for Vikings; local governments still unsure of funding
For those of you who aren't sick to death of hearing the latest Minnesota Vikings non-plans, here's today's updates:
- The Minnesota state legislature has definitely settled on electronic pulltabs as the means of funding its share of stadium costs. The bill's main sponsor, Rep. Morrie Lanning, says the measure could raise $72 million a year, which would be more than enough to pay off the state's $300 million share; it's not clear whether anyone has looked at whether e-pulltabs would cannibalize other existing state gambling revenue, but hopefully somebody will before this thing is actually voted on.
- Ramsey County is working on yet another financing plan for its share of a stadium, after sales tax and food and beverage tax hikes were rejected by the state government. No hint yet what the new plan will be, but the legislature is willing to give them more time to think of something, especially since it's not like Minneapolis has figured out what it's doing, either. County commissioner Tony Bennett hopes to have a funding plan ready by next week, but it's always a bad idea to go holding your breath in these situations.
Santa Clara files lawsuit against 49ers stadium referendum
It looks like the San Francisco 49ers court battle has begun: Santa Clara Plays Fair is reporting (still not on their website, but they sent out a press release [UPDATE: now it's online]) that the city of Santa Clara has filed suit against the group's petition filing for a referendum on the revised stadium plan. The city had previously indicated that it felt the referendum was illegal, since a 49ers stadium plan (albeit not this one) was previously approved by voters in 2010; now the matter will be up to a judge — or in all likelihood, several, as it works its way through the inevitable appeals.
In other 49ers news, plenty of fans are still hopping mad about the sky-high prices for season tickets plus personal seat licenses that were unveiled last month. We'll see how many of them actually carry through with their threat to cancel their season plans once they're offered the chance to downgrade to cheaper, crappier seats — that helped alleviate some of the sticker shock faced by the New York Yankees, among others — but it can't be a good sign that one longtime season ticket holder is actually threatening to become an Oakland Raiders fan.
January 30, 2012
Vikings still mulling Arden Hills, add 4th Minneapolis site
Okay, the Great Minneapolis Vikings Stadium Site Search has officially jumped the shark in terms of ridiculous plot points: As if having four problematic stadium plans (five if you count Shakopee) on the table weren't crazy enough, now the Vikings say they're looking at yet another site in Minneapolis. This one, a few blocks away from the Metrodome, would allow the team to keep playing in its current home while a new one was built, rather than moving to the University of Minnesota's new stadium — something the Vikings owners don't want to do both because it doesn't have a roof and it doesn't allow beer sales, though that could change.
One possible reason for the Vikings to be opening this can of worms: Many NFL owners are apparently opposed to the team playing at TCF Bank Stadium, since they wouldn't be happy with either the reduced revenues the Vikings would be bringing in or the not-up-to-the-NFL's-lavish-standards facilities for visiting teams there. SB Nation has even speculated that this could push the Arden Hills site back onto the legislative radar after Gov. Mark Dayton called it "not viable." Is it time for someone to repropose Blaine yet?
Rams, St. Louis battle over London "home" games
A couple of weeks ago, new St. Louis Rams majority owner Stan Kroenke upped the ante in his simmering lease war with the city of St. Louis by scheduling one "home" game a year for the next three seasons to be played in London's Wembley Stadium. This was widely seen as a slap in the face of his hometown as he tries to angle for either a new or improved stadium to replace the 17-year-old one that was built by the city to lure the Rams in the first place.
Now, St. Louis has slapped back, insisting that playing home games across the Atlantic would violate the team's lease, which requires that the Rams play all their home games at the Edward Jones Dome. And then the team slapped back in return, issuing a statement that they "look forward to having amicable and meaningful dialogue with the CVC on many issues and believe those conversations should remain between the parties."
The issue here likely isn't over whether St. Louis fans get to watch one less game a year in person — after the last few years, Rams fans could be forgiven for wishing that their team played all its games somewhere far, far away — but rather that it gives the city a bargaining chip in its lease squabbles with Kroenke, who's trying to exercise a "state-of-the-art" clause to threaten to move the team if he doesn't get a new stadium. The city faces a Wednesday deadline to produce a stadium plan that could be implemented by 2015, or else the Rams could conceivably break their lease after the 2014 season — though as we've seen elsewhere, getting out of a lease doesn't do much for you unless you actually have someplace else to go.
Dolphins: We built our stadium all wrong, fix it please?
Miami Dolphins officials dropped by the Miami Herald offices on Friday, and one of the discussion items was the team's unhappiness with Sun Life Stadium's current seating arrangement:
"We have the furthest distance from the sidelines with our lower bowl in the NFL," {Dolphins president Mike] Dee said. "We have the fewest number of seats in that lower seating level between the 20 yard lines, between the goal lines, in the NFL. Not just the facilities that compete for Super Bowls. We've got to fix that ...
"At the same time, we may look to amend capacity in areas where we may have too much. Right now, we have the largest upper deck in the NFL -- 35,000 seats. The next facility in line is 27,000. The Redskins took 10,000 seats out of their upper deck this past year. We're looking at all those things to retrofit the stadium to today's standards."
And by "we," Herald reporter Armando Salguero makes clear, Dee meant "someone other than us":
[T]hat costs money. And neither the legislature, nor local politicians are volunteering to pay for that. The public would likely vote down a ballot measure for such expenditure. And owner Stephen Ross is in no hurry to spend the multiple millions of dollars it would cost to do the project.
Not noted in the article: The Dolphins actually own Sun Life Stadium, having built it in 1987 with private funds. (The distant sidelines were so that the stadium could also host baseball as a way of boosting revenues — something that worked even better when then-owner Wayne Huizenga sold the Marlins but kept collecting high-priced rent.)
For the moment, Salguero speculates that the Dolphins could tarp off part of the upper deck to reduce capacity, but it sure sounds like this is the start of a renewed Dolphins campaign to ask for public money to renovate their private stadium, after last year's attempts crashed and burned so spectacularly.
January 27, 2012
Canada: No arena subsidies if it's for a pro team
In yet another indication that Canada remains a different country from the U.S., the federal government is threatening to withdraw funding for an amateur hockey rink in Laval, Quebec, because it's learned that a minor-league pro team might move there:
There are growing rumours that the Hamilton Bulldogs of the American Hockey League — the farm team of the National Hockey League's Montreal Canadiens — are planning to move into the Laval arena when it will be built.
Ottawa is now warning that it will pull the plug on the project unless if obtains guarantees that the arena will not be used by an AHL or a major-junior hockey team. Otherwise, the government fears that it will be hit with a new round of lobbying for other sports infrastructure projects in cities like Quebec City, Edmonton and Regina.
"If we allow a breach in our policy, we're toast," a federal official said.
From the sound of it, part of the reason for the reversal was griping by city officials in Quebec City that the Laval arena was getting federal stimulus money and their own proposed NHL arena (which still isn't any closer to having a team than when it was approved last year) wasn't. Still, the concept that giving public money to one team might be a bad idea because it will encourage other teams to ask for it too is a notion that most U.S. officials would likely find ... well, foreign.
Minneapolis council opposes Mondale's stadium vote end run; legislature turns toward e-pulltabs
The latest in the Minnesota Vikings stadium scrum:
- State stadium negotiator Ted Mondale thinks he can get around Minneapolis' voter-approved ban on using city money to fund a stadium without a referendum by instead having the city vote to direct the funds to stadium authority, and then that body would spend it on a stadium, so that "it really isn't the city spending that money." Pretty clever, eh? Except that apparently Mondale never asked the Minneapolis city council about his idea, and a majority of the council now opposes funding a Vikings stadium without a public vote, after councilmember Sandra Colvin Roy declared that doing so would thwart the "will of the people." (She even cited the Occupy movement as a reason that government shouldn't so easily dismiss voters' concerns.) Minneapolis Mayor R.T. Rybak retorted, "We're not going to do a referendum in the city. We are going to have a referendum in a couple years when I stand for re-election." He might want to check with George Petak before saying that too loudly.
- It looks like whatever state bill emerges to fund a stadium will use electronic pulltabs in bars and restaurants as its funding mechanism — which should come as no surprise, given that that's pretty much the only option that doesn't involve either raising taxes or getting sued by Native American tribes. It's still early, though, and even if the state finds enough money for its share of a stadium, there's still the matter of the local government share (see above) that the Vikings are insisting on.
Indianapolis to lose money on Super Bowl
Every so often, I get a call from a journalist asking what I think the economic benefits are to a city of hosting a Super Bowl. To which I can now answer with a link to this Indianapolis Business Journal story:
Scores of businesses in and around Indianapolis are licking their chops in hopes of scoring a windfall from the city's hosting of the Super Bowl on Feb. 5.
But the city entity that manages Lucas Oil Stadium, where the game will be played, expects to lose money.
The Capital Improvement Board of Marion County is budgeting for total Super Bowl expenses of $8 million and revenue of nearly $7.2 million, leaving a loss of $810,000.
The main added costs are for extra police time and hiring of additional temporary workers. That's partly made up for new tax revenues from the estimated $200 million in spending that will go on in the city during Super Bowl week,
But that tax money is limited, in part because, notes the IBJ:
- The NFL is using its tax-exempt status (yes, the NFL is tax-exempt, and yes, lots of other people also think this is ridiculous) to get its wmployees out of paying hotel and restaurant taxes.
- Food and beverage taxes collected inside Lucas Oil Stadium also won't be going to the CIB, but will be diverted to the NFL.
However, Indianapolitans will at least get the thrill of watching the Super Bowl on TV and knowing that they could be there, if only they had tickets. Plus the free publicity that comes from the world learning what it's like in Indianapolis in January. With benefits like these, who needs tax revenues?
January 25, 2012
Santa Clara council rejects 49ers referendum, setting up court battle
As expected, the Santa Clara city council last night rejected petitions calling for a new referendum on a proposed $1.2 billion San Francisco 49ers stadium, ruling that while enough signatures were collected, the issue is not "referendable" because the project was already approved in a public vote in 2010.
Several people who spoke at what sounds like a raucous council hearing, however, raised questions about whether what the council passed in December is what voters approved two years ago:
But dozens of opponents showed up in force to complain they were "ripped off." They brought glossy 2010 campaign materials funded by the 49ers that showed the team, NFL and stadium revenues would be responsible for 88 percent of the project's cost.
"That is what this community bought, but that is not what you agreed to last month," stadium opponent Kate Grant said, holding up the campaign flier. "The terms of this agreement have changed dramatically."
The dispute is now almost certainly headed for court, which if history is any guide could take a while. With the 49ers hoping to break ground this spring, whether the referendum drive can stop the stadium from going ahead could depend on whether a judge is willing to grant an injunction against the project continuing — though it'll also be interesting to see how the bond market responds to a bond issue whose legality is being challenged in court. If nothing else, that planned 2014 opening date now seems even more optimistic than it did last month.
Florida homeless-shelter bill wouldn't actually recoup stadium subsidies
Apparently there's a small problem with that bill to require Florida stadiums that received public funds to double as homeless shelters. As Stephen Nohlgren of the Tampa Bay Times reports, the original requirement was introduced in 1988 to win support for allowing sales-tax money to be kicked back to help pay for construction of the stadium that went on to become Tropicana Field, current home of the Rays — a subsidy scheme that's since been used by numerous other sports teams. The bill, proposed by state senator Michael Bennett, would require that stadiums immediately set up shelters on off days, or else refund all the cash they've received.
And the problem? Take it away, Nohlgren:
But in fact, only one stadium listed by legislative analysts — the Miami Dolphins' Sun Life Stadium — is owned by a team that received the sales tax exemption. The other 17 are owned by cities, counties or public sports authorities. Refunds would be borne by taxpayers.
The bill doesn't seem to have much chance of passage in its current form, regardless, though it's always possible it will lead to some debate on legislation that would actually affect the sports teams that Bennett is upset about subsidizing. I wouldn't hold your breath, though.
January 24, 2012
U-T San Diego covers own stadium plan, mayor hates it
And we have our first glimpse at how U-T San Diego (the former San Diego Union-Tribune, renamed by its new developer/right-wing activist owner Doug Manchester) plans on covering the $1.5 billion Chargers stadium/convention center/kitchen sink plan proposed by its own publisher in Sunday's paper. Today, reporter Matthew T. Hall takes a look at the viability of the waterfront stadium plan, albeit under the somewhat self-aggrandizing headline "Waterfront stadium plan revives debate." Among the highlights:
- Chargers stadium czar Mark Fabiani says the team remains focused on a stadium at a bus yard in East Village, but that the waterfront site could be a fallback option.
- Union leaders, who would face the displacement of dockworker jobs, are "willing to listen."
- San Diego Mayor Jerry Sanders "declined to comment."
Not included in the piece: Any attempt at analyzing where on earth the money would come from for this plan. (Manchester made some suggestions of his own on Sunday, but they didn't add up to $1.5 billion.) Sanders' position, meanwhile, was reported very differently in other news outlets:
Mayor Jerry Sanders said Monday he opposes U-T San Diego's proposal for a new Chargers stadium and expanded convention center...
Sanders has expressed support for the stadium being part of a wider entertainment district, but not the way it was proposed Sunday.
"The city is ready to move forward now on a realistic plan to create thousands of jobs, protect our convention business and increase revenues for neighborhood services," Sanders said in a statement to City News Service. "We have to address these important priorities in a responsible way."
But at least the UTSD is all over the story of how much Twitter traffic its plan generated.
Santa Clara referendum petitions validated, vote still a ways off
The Santa Clara County Registrar of Voters has confirmed that Santa Clara Plays Fair has collected the 4,500 signatures required to force a vote on the $1.2 billion San Francisco 49ers stadium plan, which would require the city to put out $850 million in cash and get somewhere between all of it and not very much of it back.
Of course, Santa Clara has insisted that the stadium project isn't subject to referendum, so next stop will be, as promised, court. Stadium opponents have enlisted the ACLU to seek an injunction against starting stadium construction until the referendum issue can be settled.
Exactly how much the 49ers are committing to backstop the city's stadium bonds remains murky — I'm still puzzling my way through the rat's nest of the city's development agreement, and you're welcome to do the same if you want to play along at home. Though it's worth noting that Stanford sports economist Roger Noll did tell the Wall Street Journal last week that the city's return on its stadium investment could range "from pretty close to break-even to a catastrophe," which I'll take as validation of my own analysis.