The bizarro plan to have private investors buy Chase Field, home of the Arizona Diamondbacks, from Maricopa County and maybe build a new one already wasn’t going well when the putative investors never showed up to any meetings, though they did have their lawyer send a letter to the local newspaper. And now it’s really not going well, as recounted by the Arizona Republic’s Rebekah Sanders:
The Diamondbacks undermined investors by releasing to The Republic notes from a discussion that Stadium Real Estate Partners II had asked to remain confidential. According to notes by an attorney representing the team, attorneys representing the investors criticized the “structural integrity” of Chase Field and the anticipated high cost of repairs — as much as $180 million. Touring the ballpark “scared the s*** out of” the investors, according to the notes. “Putting money in this aging facility is a waste.”
The investors hoped to use the Government Property Lease Excise Tax incentive program to avoid millions of dollars in property and excise taxes on a new stadium, according to the notes. No property taxes are currently paid at Chase Field since a government entity — the county — owns the land.
That’s a lot of tea leaves to read, but it sounds like: 1) the Diamondbacks owners are more interested in making a case for their stadium upgrade demands than for a sale plan that was the county’s idea in the first place, and 2) the private investors didn’t really know what they were getting themselves into, other than “hey, let’s get a stadium and get subsidies for it somehow,” which is working the D-Backs owners’ side of the street.
The problem remains much the same one as with Donald Trump’s infrastructure privatization scheme: If a project isn’t making any money, just shifting it from public to private hands isn’t going to suddenly make it more profitable, unless there are new subsidies involved. The only real hope for this stuff is that you find a private developer who’s able to come up with an innovative way of making money that the government hadn’t thought of (not likely, but possible) or who’s dumb enough to throw money at a gamble that’s likely not going to pan out (also not likely, but possible); the danger is that either you have to subsidize the project up front, or that the private entity goes belly-up and leaves its public partner holding a half-billion-dollar bag, which is all too possible. So it might actually be easier for all concerned if these private buyers bail on the plan, and just leave the D-Backs owners and the county to keep fighting it out over who’ll spend on what — if nothing else, that kind of subsidy battle is way easier to understand.