Orlando City to give back subsidies and fund own soccer stadium, in world’s first June Fools joke

I’ve been pretty much out of commission today (will catch up on Monday), but this news item required a quick response:

Team owner Flávio Augusto da Silva announced Friday the franchise will privately finance the construction of its downtown soccer-specific stadium. The stadium, originally envisioned and pitched as a city-owned venue, will now be owned and operated privately by Orlando City.

Wait, what? The same Orlando City S.C. that got $40 million in city and county subsidies two years ago? And which was demanding another $30 million from the state? Suddenly da Silva found $70 million in his other pair of pants, and now he doesn’t need public money after all?

The arrangement will save the City of Orlando more than $15 million it had pledged for the project, in land and construction funding — and will bring in additional tax revenue for the city, because the privately-owned stadium will generate property taxes…

In addition to privately financing the stadium, which officials said is expected to cost more than the originally-projected $115 million, Orlando City will buy back the stadium land from the city.

There are a few possibilities here. One is that it is Christmas, or maybe the Rapture, and from now on sports team owners will decide that asking the public to pay their bills is just wrong, so from now on we’ll be paying construction bills and our taxes alike! A related, slightly less implausible scenario is that the Orlando City owners decided that they’d lose a pile of money if they didn’t break ground soon and had to delay their stadium’s opening, so throwing in $70 million in cash plus the cost of land plus property taxes until the end of time is totally worth it.

Or — and I’m sure some of you have thought of this already — maybe there’s another shoe to drop. I’m not sure what this would be (the da Silva press statement doesn’t leave a lot of loopholes for hidden subsidies, though having the city somehow cover operating costs would be one possibility), but there are a lot of suspicious factors here: The notion of a sports team owner willingly giving up already-approved subsidies, for one, but also the timing of this announcement on a Friday afternoon, when there’s little time for journalists to research WTF he’s on about before having to file their stories (and web videos) and head home for the weekend.

And unfortunately, I can’t do much better than that today, other than to raise a skeptical eyebrow and plan on following up on Monday. In the meantime, I certainly hope this is for real, and not one of those hoaxes that the kids today like to put over on gullible journalists.


13 comments on “Orlando City to give back subsidies and fund own soccer stadium, in world’s first June Fools joke

  1. I had been deeply, DEEPLY, critical of Orlando City’s stadium efforts from almost the jump.

    But if they stay true to every word in this announcement? They’ll get nothing but the highest of praises from me.

  2. Actually, Orlando City is not the only team to decide to completely finance their own stadium out of pocket. LA FC, an expansion team set to enter MLS in 2018 (I think) has put forth plans to build a $250 million stadium entirely out of pocket. No ideas how much the new and improved Orlando City stadium will cost (they are after all significantly increasing the capacity) but I doubt it’ll be that much. For one thing, everything is cheaper in Orlando than LA.

    I was honestly kinda hoping they would just forget about the money form the state and pay the rest of the cost of the stadium out of pocket. Massive respect for Flavio, Phil Rawlins, & Co. for going above and beyond that. I honestly didn’t even care all that much about the city, county, and state spending money on a soccer stadium. Fuck it, we spend money on worse things than that all the time. At least SOME regular folk would benefit from that (even if indirectly.) The club paying for the whole thing out of pocket is definitely preferable though. It just goes further to prove what the Orlando City faithful always knew to be true. This club is special. Maybe I’m biased because I’ve been a fan and have attended damn near every single home game since 2011. Maybe I’ve had a couple of beers and am not thinking straight. But damn it this is my club and it means something to me. They’ve set themselves apart from everyone else from day one and they continue to do so to this day. Orlando City > all others.

    Still, I’m not going to sit here and claim that the state of Florida somehow lost out on mysterious millions in revenue by not handing over very real millions (tens of them as a matter of fact) to the club villy nilly. That would be stupid.

  3. I was equally shocked by this news as I think everybody was. All of a sudden they just happened to find over $100 million to spend on their own stadium…AFTER the taxpayers had already agreed to give them money. That’s crazy. I didn’t think they were in the financial position to do this. If you’d told me they were going the make up the $30 million shortfall out of their pockets, I would’ve had much less trouble believing it. But the whole thing? Where did that money all of a sudden come from? And they’re going to pay taxes too? That’s shocking to me, though count me suspicious that at least some sort of tax deal was struck in the back room of City Hall.

    The notion of MLS stadiums being privately financed is not shocking in and of itself and is becoming increasingly the norm. Avaya Stadium was privately funded. LAFC’s will be, as will Minnesota United’s (though I hope that Minny will at least fork over some tax breaks for crying out loud…he’s not asking for the moon). Sacramento’s stadium plan is centered around private funding, which I think they have the capital to do. All of those groups, however, at least appear to have more financial clout than da Silva’s comparatively modest consortium. Lew Wolff in San Jose is more comparable, but Avaya is smaller and cheaper than the Orlando City project.

    Public money for sports stadiums is becoming increasingly unpopular and that isn’t surprising. I’ve always believed that owners should fork over their own money for stadiums and you’re seeing that more and more. Owners across all major sports are having a hard time getting stadiums built because local governments are becoming increasingly stingy. Voters are saying “pay for it yourself or GTFO.” I think teams like LAFC, Minnesota, and Sacramento have the right idea gathering a very large pool of deep pocketed investors.

  4. Florida’s sunshine laws will allow us to find out in a couple years, but it sounds legit. They didn’t leave much wiggle room, and even said they’d be paying property taxes.

    I was railing against the stadium, hard to cry at this point.

    In the end I think that they knew that the money from the city, county, and state still on got them a 19,500 seat stadium and they’re drawing a little less than 40k a game. Even when the honeymoon is over, 25,000 could be regular crowds for weekly events. (It’s an event, tailgating, etc).

    Now, what to do about the people parramore, gentrification is coming and it would be insanely unfair to just move them.

  5. Phil Rawlins, Flávio Augusto da Silva and the rest of the Orlando City organization await your apology Neil. This appears to be the real deal. Even if the city of Orlando pays for something else it’s a great deal that took a few blocks of urban blight and is about to turn it into one of the Central Florida’s civic jewels. It will bring the community together and attract the foreign visitors our tourism industry craves. You need to acknowledge when someone does the right thing. A picture of you wearing a #10 Kaká jersey is in order here.

  6. Apology for what? They genuinely did demand a bunch of subsidies, then another $30m more from the state. As I said, I certainly hope this is for real, and I applaud da Silva and Rawlins i they’re really doing this, but it’s an odd move to say the least, given both their own past history and that of, oh, almost every sports team owner ever.

  7. @Mike Moran: They’re basically doing now what they should have been doing all along. If anything, this is vindication for those of us who didn’t think they should have gotten those handouts in the first place.

    Doesn’t make them any less worthy of plaudits, but let’s not engage in historical revisionism and pretend like they were planning to bankroll the whole operation by themselves from the jump.

  8. Keith, that’s what you got from everything that I said? My opinion that a $3 million tax break for someone investing $250 million in your city is not asking a lot? I don’t support taxpayers bankrolling construction but big businesses traditionally get tax incentives to invest in cities. It’s not an outrageous concept. Why is that a bad thing? You want businesses to come to your town. There’s got to be a little give and take. A $3 million carrot hardly breaks the bank. And, for the record, the property tax break they’re asking for has a sunset clause. I love how everybody is ignoring that.

  9. It’s $3 million a year in proposed property tax breaks in MN, so more like $30 million total in present value.

    I like this idea of “give and take,” though. Let’s see, I spend about $8,000 a year on groceries. By this formula, New York City owes me $160 a year in incentives for my investment in Brooklyn. That’ll hardly break the bank, so it’s totally reasonable!

  10. Eric – I’m not up-to-date on the current state of the Minnesota deal, but I got the idea from your comment that a privately-funded stadium is a done deal. If that’s the case, offering them a tax break now makes no sense at all. Although it wouldn’t be the first time a locality gave in when facing a leverage-free negotiation.

    Neil – Small technical issue: the little Reddit boxes attached to articles on your home page are all connected to one article from awhile back.

  11. The Minneapolis expansion team is contingent on a stadium, and the team owners are insisting that they need a subsidy to build one. Whether that’s a bluff or not is left as an exercise for readers.

    As for Reddit: That’s really weird, as this is a widely used plugin that runs the Facebook and Twitter boxes as well. Will look into it thanks.

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