Wolff to Oakland on A’s lease extension: Our way or … some highway, I guess?

The Oakland-Alameda County Coliseum Joint Powers Authority finally revealed some details of A’s owner Lew Wolff’s proposed lease extension, and they’re pretty much what we’ve been hearing for a while now:

  • Wolff would pay about $15 million in rent over the course of the 10-year extension, a slightly higher rate than they’d be paying now. The team could leave with two years’ notice if the Raiders cut a deal to build a new stadium on the Coliseum site, or starting in 2018 regardless of what the Raiders do, but Wolff would still have to pay rent on the Coliseum.
  • Wolff would settle a dispute over $5 million in back rent by instead investing $10 million into a new scoreboard system, something he’s been wanted to do anyway.
  • The Coliseum Authority would put $1 million a year into a fund to fix the Coliseum’s sewage issues.

The big news, though, is the dueling “fuck yous” that the Oakland city council and Wolff issued today over tomorrow’s potential vote on this deal. The Oakland council has ordered its four representatives on the stadium board — that’s half the body — to vote against Wolff’s plan, and instead offer its own proposal, which will include higher rent payments, and possibly more restrictions on the A’s out clause. In response, Wolff declared today that “we are 100 percent finished” with lease talks, and “if someone wants to do something else, we have no interest in that. … If we don’t get a positive vote, we’ll be very sad after 14 months of negotiations.”

If you’re scoring this game of multi-dimensional chicken at home, the calculus goes like this: Oakland officials know that Wolff needs to have a place to play after 2015, and if he doesn’t want to be forced to play in the street — or, I guess, in someplace like Sacramento, which would be marginally better than the street — he needs to bargain with them over the Coliseum. Wolff, meanwhile, is simultaneously trying to isolate the Oakland councilmembers — Alameda County board reps, don’t forget, are fine with this deal — and make a case to his fellow MLB owners that “Hey, Oakland won’t give us a lease, won’t you pleeeeeeeeze let us move to San Jose now?”

If anything, Oakland has less to lose in this standoff: Yeah, the A’s could potentially move, but there’s nothing really stopping them from moving if they do sign the lease, anyway. The real question is what Wolff is going to do if Oakland calls his bluff: Is he really going to go into the last year of his lease with nowhere else to play, hoping that either Bud Selig’s successor panics and lets him have San Jose, or some other city jumps in with a new stadium offer? (Though a new stadium elsewhere could never be completed by 2016, and there are pretty much zero available MLB-ready stadiums where he could play in the interim.) That would be gutsy, I suppose, but also leave Wolff potentially having to come crawling back to Oakland if neither MLB nor another city takes the bait.

It all promises to be great drama, anyway. More tomorrow as events develop.


37 comments on “Wolff to Oakland on A’s lease extension: Our way or … some highway, I guess?

  1. There is one other option that MLB has previously broached Neil, the A’s could skulk across the Bay and play at AT&T Park on a temporary basis as well. And it’s an option that even the Giants have been open to (or at least not openly against). And it’s an idea that while not often used is not without precedent. Plus it would give the A’s a cushion to either make something work in San Jose or elsewhere out of the region.

    In the case of San Jose it would also be a way for the A’s to compensate the Giants in part for moving to SJ by way of generous rent payments and other concessions regarding things like parking and concessions. In the latter case, I don’t doubt the Giants would have no problem hosting the A’s for a few years on their way out of town leaving the Giants as the sole Bay Area team.

  2. There is no option to play at AT&T. Non-starter regardless of whether the A’s, Giants, and MLB agree to it. SF has strict land use, transit impact, and EIR requirements. MLB cannot drop another 81 events into SoMa without the appropriate approvals. If you think those come easy, please see Prop B and 8 Washington.

  3. Not to mention that a lame-duck A’s team playing in SF wouldn’t even draw flies. That’d be a hefty fee for Wolff to have to pay just to end up in Portland/Charlotte/wherever, and then having to pay toward a new stadium.

  4. I wonder if Victory Field in downtown Indianapolis would be a possible relocation site. Victory Field currently seats 12230 (14230 with lawn seating) and appears to have enough room for expansion. The existing Triple-A team would need to be relocated though. Probably just a pipe dream.

  5. Wolff/Fisher have no intention of moving the team outside of California. By moving to ATT Park they would reap the benefits without making a capital investment.

    They could revenue share(70/30 or 80/20)and pay rent to the Giants on everything and would be able to add 40M in payroll easily with zero capital investment….they could keep their stars for once long term.

    This is my scenario of having the A’s sitting on top the of the Giants until they scream “Uncle” and let them into San Jose.

    Granted the Giants would be making oodles of extra cash sharing with the A’s but it would kill their psyche.

    Imagine the San Francisco Athletics winning the World Series at ATT Park? The pain would be so much they would give San Jose away…..further more, imagine a WS parade for the A’s on Market Street? Bahhahahah!

    This is where we are heading unless San Jose wins one of their two current lawsuits vs. MLB which would entail a settlement where the A’s are allowed to move. A’s are stuck in the Bay Area for immediate 5-10 years. Question is where will they be in 10 years? ATT Park or San Jose?

  6. Reason why is the A’s could increase payroll by 40M is because they would have access to premium seating they lack now.

  7. SBSJ: So you think the A’s could add $40m in payroll *and* pay the Giants “oodles of extra cash” *and* make up for what they currently get in revenue sharing? I didn’t realize there were that many A’s fans in San Francisco with money to burn.

  8. SBSJ The giants are not letting the A’s move to ATT park. They own the place. No one can force them to accept anything.

  9. The only suggestion that the A’s could move to AT&T reportedly came from MLB officials, not the Giants. (Presumably to try to put some pressure on Oakland to hurry up on lease talks.) And came via Mark Purdy, so really, enough said:

    http://www.mercurynews.com/athletics/ci_24448936/major-league-baseball-may-allow-oakland-play-at

  10. Oakland Ballpark, you sure about that?

    http://espn.go.com/mlb/story/_/id/10531584/san-francisco-giants-willing-share-att-park-oakland-move

    The Giants have been quoted earlier this year as saying they would be willing to share AT&T Park with the A’s. So no one would be forcing them to do anything ;)

    Though MLB can always force its members to do something if it really wants to even if the Giants weren’t being amenable. But it will of course be easier with the Giants cooperation, particularly when it comes to fast tracking hosting 81 more games a year at that park. And I’m not convinced the A’s wouldn’t draw big crowds in the nicer surroundings, particularly if their ultimate destination was San Jose. If they were leaving town they’d of course be playing in front of much smaller crowds, but it would also help mitigate any environmental impact issues too as would any stay that was framed as temporary from the outset.

  11. Neil, read my link above. The Giants also were quoted about the possibility in Feb, not just MLB and their suggestion last fall.

  12. You are correct — thanks for the correction. I’m still not sure that “Giants would rent to the A’s for a couple of years while they built a new stadium on the Coliseum site” would mean “Giants would rent to the A’s indefinitely if they decided to tell Oakland to get bent,” but it does open the door a crack.

  13. Athletics’ attendance would be higher at AT&T Park than at the O.co Coliseum.

  14. So Neil- you really think MLB will make any of its owners sign a poor business deal? They are trying to get themselves out of a few messes not add to it. A’s have proposed a very fair lease extension to continue to play in a shithole- Oakland chooses to turn it down then it opens the door for an easy settlement with San Jose so MLB can avoid a date with the 9th Circuit

  15. So Neil- do you really think that MLB would make one of its owners committ to a bad business deal…seems to me they are working to get themselves out of a few already. The proposed lease is more than fair to continue to play in a shit hole that is nearly 50 years old. Reality is Oakland is afraid to committ to it for fear of what NFL/Raiders will do- remember- they have a commish that actually has some balls.

  16. No, I don’t think MLB will make one of its owners commit to a business deal they don’t like. But they’re not going to force the Giants to rent to the A’s, either. And they can’t force Oakland to sign this lease extension.

    I agree that a lot is going to depend on how scared MLB is of the San Jose case. They don’t seem too worried so far, though.

  17. I’ve read through the lease agreement as published on Newball.com and have one question. What is a “scoreboard cap”?

    “• Scoreboard caps. The Authority will pay $200,000 per year for the use of the scoreboard caps where the am name is currently displayed. The 2014 License contains provisions that delineate the rights of the parties should the caps be removed in connection with the installation of a new scoreboard.”

    Maybe it would be easier if I knew what “am name” meant?

    My guess is this is the location where the current name of the Coliseum is displayed.

    BTW, the lease calls for new videoboards, new ribbon boards, and, at the discretion of the A’s, a new sound system along with control room upgrades. Daktronics should have their representatives already lined up (well, if the lease were going to be approved).

  18. ALK: I’d guess that as well. You can see it here, with the current O.Co logo on it:

    http://www.wisdomportal.com/OaklandColiseum/758-ScoreboardUpperDeck.jpg

  19. And here’s the JPA’s staff summary of Wolff’s latest lease extension proposal:

    http://newballpark.org/2014/07/02/summary-of-2014-coliseum-lease-agreement/

  20. Thanks Neil. I guess that might be worth $200K. The newer boards are usually so bright that a static sign, even with the flood lights below it, would be lost in the glare.

    So, if this lease doesn’t get approved by August 1st, the new scoreboards can’t be installed in time for the 2015 baseball season, according to MLB.com’s report. Therefore the A’s will have to find more incandescent bulbs for the old matrix scoreboards. Eventually they’ll just have to start cannibalizing one of the boards to keep the other one running. I suppose the same it true with the CRT-based video boards they currently have.

  21. That’s why Wolff would want to upgrade the sound system. For those unfamiliar with the old dump, the entire Coliseum sound system is housed behind that single cap in Neil’s picture. It makes for a cavernous and distorted sound that is all coming out of foul territory in right field. It’s always been bad but has become worse with age.

  22. Dan, I had forgotten about where the speakers were located. I remember that now from 1997 when I was there last.

    Strangely the worst sound system is still Dodger Stadium with that tower in center field. Never understood how they could be that close to Hollywood and yet have a speaker tower in centerfield. Reminded me of the renovated Yankee Stadium (1976-2008) with the giant black speaker tower above the middle scoreboard.

    But, I digress. You would hope if they replace the current sound system with a more modern one it would be a distributed speaker system. That would not be cheap since all of the audio lines (actually data lines now) would have to be run fresh.

  23. The Carolina Panthers just put in a new distributed sound system, but I haven’t been able to find how much they paid. It’s part of a larger $65 million renovation that includes a new scoreboard and new escalators, though, so I can’t imagine it was more than a few million dollars for the sound system alone.

  24. Here’s another recent one:
    http://globenewswire.com/news-release/2014/06/18/645061/10085930/en/Photo-Release-San-Diego-Padres-Open-Season-With-New-Video-Feature-Sound-System-From-Daktronics.html

    Have to give Dak credit for branching out from scoreboards to control room systems to distributed audio to get more of the revenue that cities are willing to give.

  25. Well to be fair when comparing with San Diego, the existing sound system infrastructure was already there at Petco. Though I wonder if Dak will be who the Padres tag for their new scoreboard they’re planning to install in the off season to replace their 15 year old board (due to delays during construction the Padres scoreboard is 5 years older than the ballpark). Petco is actually the second smallest video board in MLB at present ahead of only, you guessed it, the Coliseum. (Incidentally when talking about NFL video boards the other San Diego stadium, Qualcomm, also has the second smallest boards in its league ahead of only Oakland as well).

  26. @Neil- The A’s have the lowest revenue in the league (TV deal excluded) and it is because they lack premium seating and play in a dump.

    At ATT Park they would all of a sudden have new revenue streams without making any capital investment. According to Bloomberg the A’s were at 175M last year in revenue, good for dead last or tied with the Rays.

    Their gate receipts were a league low 33M, concessions were 9M, and parking 5M.

    The Giants by contrast playing in shiny ATT Park were 126M in gate receipts, 26M in concessions, and 9M in parking.

    That gap is 100% due to the ballpark itself. It theory, If the A’s were to share with the Giants their gate receipts would double to 66M, their concessions to 15M and parking to 7M. These are “modest” #s as the Coliseum is THAT BAD for baseball while ATT Park is THAT GREAT for baseball.

    I for one believe their gate receipts would be 80M, concessions 18M, and parking 7M. Still far lower than the Giants but a big boost from what they are getting now. But let’s stick with my first numbers for arguments sake.

    Of course the A’s would have to revenue share a piece (20%) with the Giants and pay rent (5M+ a year so).

    MLB benefits from the fact the Giants revenues would soar causing them to put more into the revenue sharing pot, so paying the A’s the same revenue sharing dollars they get now is OK even though the A’s revenues would go up as well.

    Since the A’s are a tenant and homeless it is unfair to reduce the amounts they receive from the pot. It is offset by the huge revenue increase to Giants.

    From this logic it actually behooves MLB to have the two teams share ATT Park rather than the current situation. But this Bud Selig and MLB who are archaic in their thinking.

    So from my first set of #s the A’s would increase their revenue by:

    33M (Gate) + 6M (Concessions) + 2M (Parking)= 41M in increased revenue to spend on payroll and they are still making the same profit they are now…..Once again I reiterate these numbers are very modest and in reality it should be more.

    In San Jose, the A’s would be big market spenders on the Giants level. But that is another set of #s to be broken down on another day.

  27. Also keep in mind the SF Bay Area is the wealthiest market in the United States. It shows how dumb MLB and Bud Selig are not capitalizing on this market big time.

    This is what they get for signing an anti-competitive agreement with the Giants locking the largest city in the market out.

  28. Well here we go.

    http://www.sfgate.com/bayarea/article/Selig-permits-A-s-to-leave-Oakland-prompts-last-5598201.php?cmpid=twitter-mobile

    MLB has given the A’s permission to leave Oakland if the lease isn’t approved.

  29. No they didn’t Dan.

    That is the same “allowed to seek” consent that Wolff referred to. There is no information in that article or anywhere else that I have found indicating that MLB itself has approved the Oakland A’s relocation to any other city.

    Wolff has always had “permission to seek” alternatives, just as any other owner has. What he does not now have and has never had is permission to move to anywhere else. When that changes, it will indeed be news. SFGate’s personal take on the matter is irrelevant.

  30. SBSJ: The A’s continue to operate on a very profitable basis – that is indisputable – while playing in a “dump”. And they are currently the best team in baseball. Those two very important points aside, if the sensationalized figures you mention are even remotely accurate, it begs the obvious question: Why haven’t the A’s moved to AT&T already? Why not simply let the current lease expire in 2015 and then work out a deal with the Giants?

  31. SBSJ: “SFBay is the wealthiest market in the US”.

    Provide supporting data for this claim please?

    “this is what they get for…. locking the largest city in the market out”.

    No agreement exists that prevents baseball fans in San Jose or the South Bay in general from attending or watching MLB games, nor from sponsors and interested parties from getting involved. There is nothing anti-competitive about choosing the location you wish to host your franchises. I’m sure MLB’s lawyers would (and have) argue that this freedom of choice is fundamental to their business viability, as it is to any other businesses.

    You seem to believe that every city in America is “entitled” to have Major League baseball. If MLB were a democracy owned and run by it’s fans, that might be true. It is not. It has never been anything like a democracy. It is a sports cartel, and like most other sports leagues, dangerously close to a racket in my opinion. It chooses, according to it’s own rules and procedures, where it will set up shop.

  32. John, you’re playing a semantics game. No one said they’d been approved to relocation just that they were given permission to leave Oakland. Leaving Oakland doesn’t necessarily entail relocation. The A’s have always had the ability and MLB’s blessing to move where ever they’ve damn well pleased within their own territory without MLB being able to do anything about it. It’s more Wolff’s formality that he consults with Selig on potential intraterritoral moves like this. But he by no means has to get that blessing. He just has a history of doing so like when he attempted to move the team to Fremont nearly a decade ago.

  33. Dan: Well, no, MLB can always vote to deny any move it wants to. But you’re correct that Wolff’s letter doesn’t mean anything changed — it was just Wolff saying, “I asked Bud if I can move if you guys keep being mean to me, and he said, ‘Sure, whatev.\'”

    But this has almost certainly been the case *for years now*. There’s no reason to be any more frightened of the move threat just because Wolff put it in an email.

  34. Well there is if Wolff is serious about it. Now that’s the million dollar question, would Wolff follow through on the threat. The spineless nitwits running Oakland obviously didn’t think so until Wolff sent an email. Granted nothing has actually changed except that Wolff reminded them of something they seem to have forgot in the years since Fremont failed.

    Though now that we are hearing that Kaplan was ordered to vote no who knows what Oakland’s actual position is. We really can’t know until Monday when the full Oakland council actually vote on it. They may not have caved yet but may have simply been exposed as divided if Reid and the other council appointee voted against the council’s majority wishes. Frankly I still hope they do vote against it. If it finally forces the issue and leads to some form of resolution I’m all for it. Even if it means the A’s vacate the Bay Area entirely.

  35. Dan: It isn’t me who’s playing semantics. There is a world of difference between having permission to look at other locations and having permission to move to one of them.

    Your direct quote is: “MLB has given the A’s permission to leave Oakland”. This is, coincidentally, the title of the SFgate piece you linked… and SFgate has very much misrepresented what the Wolff email said with that headline.

    MLB has done no such thing. And that ain’t semantics.

    Finally, I am pleased to hear you believe that the A’s may move within Oakland. Where to? Is there another facility in Oakland that could house them for next season that I am unaware of?

    Wolff has been looking at other locations and talking to people in other locations for most of the decade he has been an owner of the A’s. Why is MLB granting him permission to talk to these people now a big deal to anyone?

  36. Based upon the current fire drill sure seems that Oakland pols agree with Dan-

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