Hillsborough candidates agree: Tax somebody to pay for Rays stadium, just not sure who

The invaluable Noah Pransky of WTSP-TV (and the Shadow of the Stadium blog) has polled candidates for the Hillsborough County commission (that’s the county with Tampa in it) on where they stand on public funding for a new Rays stadium, and the survey says:

Sandy Murman (District 1 incumbent): Opposed to “a sales tax increase or use of general revenue” for a stadium, but not necessarily opposed to other forms of public funding.

Jeff Zampitella (District 1 challenger): Opposed to using general revenues, fine with hotel taxes, sales taxes, property tax breaks, or pretty much anything else.

Les Miller (District 3 incumbent, not being challenged): “We have to figure out a way to pay for it and not ask taxpayers to pay for a new stadium.”

Jim Norman (District 6 incumbent): Wouldn’t answer, but “has a long record of supporting stadium subsidies for the Tampa Bay Buccaneers.”

Tim Schock (District 6 challenger): Would likely support hotel taxes only for a stadium, wants the state to be on the hook for anything else.

John Dicks (District 6 challenger): Supports using both hotel taxes and a Community Redevelopment Area, which is essentially a TIF-style property tax kickback. Plus state money.

Pat Kemp (District 6 challenger): Would “likely oppose” general fund spending, but “might support” TIF money or parking revenues.

Tom Scott (District 6 challenger): Yes to using hotel taxes, no to anything else.

Brian Willis (District 6 challenger): Yes to hotel taxes, rental car fees, and state money, so long as it’s no more than half the total stadium cost.

Add it all up and hotel tax money sounds like a consensus pick — which would better news for Rays owner Stuart Sternberg if not for the fact that best estimates are that these would only be enough to pay off maybe $75 million in construction costs, which isn’t going to get very far toward building a whole new stadium. This sounds like it’s going to be one of those “collect pails of money from wherever you can find them” negotiations, which usually end up resorting to something totally crazy because it’s the only option that nobody outright hates.

It’s still very early, but all the “we have to get something done, we just need to figure out how to pay for it” talk is not a good starting point at all if you’re concerned about public subsidies. Add in that this is inevitably shaping up to be a Tampa-vs.-St. Petersburg bidding war — or at least a Hillsborough-vs.-Pinellas County bidding war — and it’s probably time to be very worried indeed. Winning the right to pit different localities against each other for the right to throw money at his team may have been the best deal that Sternberg ever made; St. Peterburg really should have asked for a bigger buyout, but they didn’t ask me, now did they?

13 comments on “Hillsborough candidates agree: Tax somebody to pay for Rays stadium, just not sure who

  1. Tampa’s done a great job at extinguishing any real speculation about relocation to Montreal….. Feels like there’s less than a 1% chance of that happening with how willing politicians are to use public money, but I also don’t know much about Montreal’s plan to fund a new stadium

    • The Rays can’t discuss a stadium outside the Tampa area until 2027. That’s still in the lease.

    • A $0.75 canadian dollar has done severe damage to any hope Montreal had of buying an existing or expansion team.

      Suddenly the $120m USD player payroll will be $160m. Most other expenses (outside of stadium costs) will be payable in USD also.

      Meanwhile, apart from MLB distributed revenue (which is considerably higher than it was a decade ago, granted) nearly all revenues will be earned in Canadian dollars.

      The effective value of the Jays TV deal (with their media conglomerate owners) is about $45m annually. That’s $34m USD. Compare that to any other regional rights fee in the game (except Tampa’s) and it looks very bad. Rogers eats the losses for content reasons (in their sports and, more importantly, mobile networks).

      Same story with ticket and suite sales… Take a 3rd quartile US based team’s ticket/suite revenue and multiply by 0.75.

      Total “local market” revenues for a new Montreal team would be in the $50-60m USD range – and that’s with 20,000 in the stadium every game. Add that to the MLB distributed revenue and the team would still be well short of breaking even at current market conditions – let alone be able to make stadium or expansion fee payments.

      If the C$ rises to near parity again it changes the calculation, but it still doesn’t get a Montreal franchise to consistent and meaningful profitability from where I sit ($10m occasional or infrequent annual profits is not acceptable on a $1.5bn investment).

      Aside from the “rich guy with huge ego” plan, I just don’t see it working. I’d love to see the Expos back, but the math doesn’t work even with the present state of MLBAM revenue distribution.

  2. Kinda sad that you’ve got six folks running for the District 6 seat and not one of them goes with “Nah, subsidizing businesses that don’t need our help is about the last thing we should be doing with taxes, regardless of the source.”

    • Right on Keith!

      The time is long overdue for the narrative to change from ‘How much should taxpayers pay for a new stadium’ to ‘Why should taxpayers fork over even a dime?’

      MLB and the Rays can easily afford to pay 100% of the $600 million or so for a new stadium in Tampa Bay.

      Per http://www.statista.com/statistics/193466/total-league-revenue-of-the-mlb-since-2005/ in 2001 total MLB revenues were $3.58 billion ($4.8 billion in 2015 dollars) and 56% of those revenues went to players’ salaries.

      In 2015, total MLB revenues were $8.39 billion and just 45% went to players’ salaries, even with the many ridiculously stupid long-term contracts that are negotiated, and you can now add the recent new contracts of David Price, Zack Greinke, Jeff Samardzija, Max Scherzer, Jon Lester, Elvis Andrus, Kyle Seager, Jordan Zimmerman, Jason Heyward, Justin Upton, Johnny Cueto, Giancarlo Stanton, Chris Davis, and Stephen Strasburg to the list.

      So revenues (in 2015 dollars) after deducting for player salaries were $2.1 billion ($70 million per team) in 2001 and $4.6 billion ($153 million per team) in 2015. That is an increase of $2.5 billion which averages out to $83 million per team. To build a $600 million stadium costs just $34 million per year assuming 4%/30 year terms.

      What have MLB and MLB owners done with all this extra money? Keep in mind that their slice of this ever growing pie will continue to get bigger in the coming years.

      During the Bud STEALig era (1992-2014), 21 new MLB stadiums were built, 20 of which received substantial public funding. Not only did 20 MLB clubs get lots of public money, not even one of them opened their books to show why they needed public money!

      For taxpayers to pony up even a dime for a new stadium for any team is obscene. That is like providing publicly funded college scholarships for Warren Buffet’s and Bill Gates’ kids.

  3. $75m from hotel taxes (SS can even borrow against that revenue stream if he is a shrewd enough negotiator… which I’m quite sure his professional training has made him).

    $25-30m from naming rights (either over time or up front… Sternberg can also borrow against these revenues once the contract is signed)

    This gets the Rays into a stadium mortgage for somewhere in the $500m range (I am assuming that the city will provide the land for free and own the damn stadium to allow the owner out of property tax payments).

    The Rays’ MLB welfare payments alone would cover the stadium mortgage twice over.

    It’s not that difficult to “find a way”. The problem is that the team owner is insisting that “the way” not cost him anything at all.

    • Well, sure Sternberg *could* pay for it. But aside from naming rights and hotel taxes, most of the rest, including revenue sharing, is money he gets whether he builds a new stadium or stays at the dome or plays on a barge in the middle of the bay.

      The real question everyone should be asking here is whether the Rays would make an extra, let’s call it $40m a year if they played in a better location with a snazzier stadium. If so, then Sternberg should by all means go ahead and build one with his own money. If not, then there’s really no reason for him to move at all.

      • I think everyone (or nearly everyone) is aware that the Rays will not generate significantly larger revenues at a new facility over the long haul (the Marlins might be the worst example of a new stadium bump imaginable for a lot of reasons, but apart from the Loria effect I would not expect that the Rays would do a great deal better in a new facility than the Marlins have done).

        It is likely that his only reason for wanting a new facility is that he believes he can get someone else to pay for it.

  4. As I’m sure Noah knows–Tampa is a city that historically has been run by hucksterish promoters of all kinds, selling swamp land, sunshine, and now sports stadiums. The political culture of Tampa is one that, for whatever reason, demands that the city be “major league” in sports–virtually at any cost.

    Tampa has been throwing money at sports teams for decades, and even after each team has had a championship season–economic prosperity still eludes it–which to these guys just means they haven’t tried hard enough. Throw $100 million at a mediocre NFL team, $600 at MLB, etc..and good times might result.

    The region still has below-average incomes and low corporate presence, which might be more logically solved through education and infrastructure–but that might be hard and the free tickets are kind of boring.

  5. Maybe the Rays owner should spend ALL of his money for a new playground. He could get a tax break but how about some votes for the owner!