Friday roundup: Long Island residents yell at cloud over Isles arena, Calgary forgets to include arena in arena district plan, plus a reader puzzle!

It’s Friday (again, already) and you know what that means:

  • New York State’s Empire State Development agency held a series of three public hearings on the plan to build an Islanders arena on public land near Belmont Park racetrack (which the team would be getting at as much as a $300 million discount), and the response was decidedly unenthused: Speakers at the first hearing Tuesday “opposed to the project outnumbered those in favor of the plan by about 40 to one,” reports Long Island Business News, with State Sen. Todd Kaminsky joining residents in worrying that the arena will bring waves of new auto traffic to the town of Elmont, that there’s no real plan for train service to the arena, and that there’s no provision for community benefits to neighbors. Also a member of the Floral Park Police Department worried that the need for police staffing and more crowded roads would strain emergency services. Empire State Development, which is not a public agency but a quasi-public corporation run by the state, is expected to take all of this feedback and use it to draft an environmental impact statement for the project, which if history is any guide will just include some clauses saying “yeah, it’ll be bad for traffic” without suggesting any ways to fix it. I still want to see this plan from the Long Island Rail Road for how to extend full-time train service there, since it should involve exciting new ideas about the nature of physical reality.
  • Meanwhile in Phoenix, the final of five public hearings was held on that city’s $168 million Suns renovation plan, and “out of nine public comments, three involved questions, five voiced support and one was against the deal,” according to KJZZ, so clearly public ferment isn’t quite at such a high boil there. One thing I’d missed previously: The city claims that if it doesn’t do the renovations now with some contribution ($70 million) from Suns owner Robert Sarver, an arbitrator could interpret an “obsolescence clause” in the Suns’ lease to force the city to make the renovations on its own dime. I can’t find the Suns’ actual lease, but I think this just means that Sarver can get out of his lease early if an arbitrator determines the arena is obsolete [UPDATE: a helpful reader directed me to the appropriate lease document, and that is indeed exactly what it means], and he can already opt out of his lease in 2022, it’s pretty meaningless, albeit probably more of the “information” that helps convince people this is a good deal when they hear it. (Also important breaking news: A renovated Suns arena will save puppies! Quick, somebody take a new poll.)
  • Speaking of leases, the Los Angeles Angels are expected to sign a one-year extension on theirs with Anaheim, through 2020, while they negotiate a longer-term deal. It’s sort of tempting to wish that new Anaheim mayor Harry Sidhu would have played hardball here — sign a long-term deal now or you can go play in the street when your lease runs out, like the Oakland Raiders — but I’m willing to give the guy the benefit of the doubt in his negotiating plans. Though if this gives Angels owner Arte Moreno time to drum up some alternate city plans (or even vague threats a la Tustin) just in time to threaten Anaheim with them before the lease extension runs out, I reserve the right to say “I told you so.”
  • The Calgary Planning Commission issued a comprehensive plan for a new entertainment district around the site of the Flames‘ Saddledome, but forgot to include either the Saddledome or a new arena in it. No, really, they forgot, according to city councillor Evan Woolley: “It should’ve been identified in this document. It absolutely should have. Hopefully those amendments and edits will be made as they bring this forward to council.” The 244-page document (it’s not as impressive as it sounds, most of them are just full-page photos of people riding bicycles and the like) also neglects to include any financial details, beyond saying the district would be “substantially” funded by siphoning off new property taxes, “substantially” being one of those favored weasel words that can mean anything from “everything” to “some.” Hopefully that’ll be clarified as this is brought forward to council, too, but I’m not exactly holding my breath.
  • Here is a Raleigh News & Observer article reporting that the Carolina Hurricanes arena has had a $4 billion “economic impact” on the region over 20 years, citing entirely the arena authority that is seeking $200 million to $300 million in public money for upgrades to the place. No attempt to contact any other economists on whether “economic impact” is a bullshit term (it is) or even what they thought of the author of the report, UNC-Charlotte economics professor John Connaughton, who once said he “questions the sincerity” of any economist who doesn’t find a positive impact from sports venues. Actually, even that quote would have been good to include in the N&O article, so readers could have a sense of the bona fides of the guy who came up with this $4 billion figure. But why take time for journalism when you can get just as many clicks for stenography?
  • The San Francisco Giants‘ stadium has another new name, which just happens to be the same as the old new name of the basketball arena the Warriors are leaving across the bay, and I’m officially giving up on trying to keep track of any of this. Hey, Paul Lukas, when are you issuing “I’m Still Calling It Pac Bell” t-shirts?
  • Indy Eleven, the USL team that really really wants somebody to build it a new stadium so it can (maybe) join MLS, still really really wants somebody to build it a new stadium, and hotels, office and retail space, an underground parking structure, and apartments, all paid for via “[Capital Improvement Board president Melina] Kennedy wasn’t available to discuss the proposed financial structure of the project.” It would definitely involve kicking back future property taxes from the development (i.e., tax increment financing), though, so maybe Indy Eleven owner Ersal Ozdemir is hoping that by generating more property taxes that his development team then wouldn’t pay but instead use to pay off his own stadium costs, that would look better, somehow? I mean, he did promise to keep asking, so at least he’s a man of his word.
  • “At some point in time, there’s going to have to be a stadium solution,” declared the president of a pro sports team that plays in a stadium that just turned 23 years old. “If we don’t start thinking about it, we’ll wake up one day and have a stadium that’s not meeting the needs of the fans or the community.” Want to try to guess which team? “All of them” is not an acceptable answer! (Click here for this week’s puzzle solution.)

37 comments on “Friday roundup: Long Island residents yell at cloud over Isles arena, Calgary forgets to include arena in arena district plan, plus a reader puzzle!

  1. Economic Impact. Sigh.

    A district claiming a $4bn economic impact from any project could be telling the truth. After all, an impact does not need to be ‘positive’ or generate excess wealth (through business or taxation) to be ‘impactful’.

    The $4bn impact could simply mean that the Raleigh area would have been $4bn better off not to build the arena and house the Hurricanes (nee Whalers). Glendale’s economic impact from building the arena the moribund and non viable Coyotes play in has to be in the $500-600m range… though of course all that impact is in municipal tax dollars that disappeared to pay construction bonds, arena and team subsidies and fight lawsuits – money the city should have been able to use to provide services to it’s residents, or would not have needed to raise via levy on it’s residents at worst. It is absolutely clear from the team and arena financials that are publicly available that the city of Glendale is at least $500m worse off due to their dalliance with the National Hockey League and it’s various ownership group members.

    Even more simply: If I used to own a $500k house freehold but took up gambling in a big way and, five years later, ended up not owning the house anymore due to gambling debts… well, I’ve had a $500k (roughly) economic impact on my community.

    So why wouldn’t my community agree to provide me an incentive in the $80-100k range per year just to keep me gambling here rather than somewhere else? In fact, I would argue that the community cannot afford not to have me continue to gamble right here and should buy me a new house so that I can gamble in relative comfort. Don’t think that St Louis or Boise or Houston aren’t keeping their eye on me and my gambling problem, folks… and I have a responsibility to my shareholders (which is me) to take the best deal available. Remember… my annual gambling losses are a portable asset and will go to the highest bidder.

    No matter how badly you manage your finances, it turns out you are an economic engine. Don’t let anyone tell you any different…

    • I’m pretty sure it just means “if you add up all the money spent by people at the arena over 20 years, and then all the money they spent outside the arena, and then estimate how much money the people they gave their money to then spent based on some crude statistical projection, and don’t ask how much of all that money would have been spent somewhere locally even without the team or the arena, then you get $4 billion.”

      We’re back to Tom the Dancing Bug again, really:

      https://www.gocomics.com/tomthedancingbug/2017/10/12

      • Fair enough. But not all my hypothetical gaming losses are given to the house directly. Sometimes I win a hand or two and tip the cocktail servers or blackjack dealers impressively. They in turn spend that money on something (fast food, used cars, Trump branded Turkish made shirts or ties?), so really, the entire economy of the western United States and most of Turkey depends on me continuing to (hypothetically) gamble.

        If I don’t get government funding to continue gambling, the tattoo artists that occasionally ink the blackjack dealer’s unemployed dependent 17yr old son or daughter is going to take a big economic hit here…. not to mention the clerk at the Payless shoe store where they all shop.

        And think about the doctor who is going to perform the casino server’s implant surgery? And what about the doctor’s yacht broker or contract dog walker?

        All of this depends on me being (and continuing to be) bad at math….

  2. I’ve decided that I’m in favor of this Phoenix giveaway, since I moved a couple miles east to Scottsdale. This will shut up any potential talk about moving the Suns (and their incalculable Economic Impact) to Scottsdale, whose pols are always more than happy to enhance their legacy by tossing money at somebody. I still fear the Coyotes may be eyeing my new hometown as their next chump, so I’m hoping they find a new home in Houston, Tempe, Bugtussle, wherever. Hey, somebody out there offer these guys a new arena so we don’t have to, OK?

  3. It’s really fitting that the Hurricanes are doing this around the same time they hold “Whalers Night”. I can’t think of a more fitting tribute to that era than to claim your arena isn’t good enough.

    • Not stadium related, but it’s cool to see them using the old Whaler logo and uniforms again even if it is just occasionally. But every time they wear them it just underscores how lousy the Hurricanes logo and uniforms are.

  4. The Canes are far and above the Yotes in a terrible market/marketing situation, and sharing the arena with a state college doesn’t help their sub-prime used car mortgage lender owner. (Seriously, that’s how he made his money). I’d bet that without a huge payout, the Canes will relocate a lot faster than the Yotes.

    • It’s possible. I would put the Coyotes, Hurricanes and Panthers in with roughly even odds on first to relocate.

      There are other franchises in poor economic situations (and some who’s situation is only made tolerable by liberal application of local tax dollars to keep them sated), but these three don’t really have a path to even reasonable profitability over the long term.

      • Actually the Hurricanes are already profitable…at least they were two years ago, when they were last in the league in attendance: https://thehockeynews.com/news/article/why-on-earth-would-anyone-ever-want-to-buy-the-carolina-hurricanes-here-s-why

        • Earthfirst: A quote from your linked article…

          ” …keeps the franchise in Raleigh, where it has traditionally been a black hole that attracts money. To be fair, the Hurricanes did turn a slight profit last season, thanks to getting their share of revenue-sharing money. On top of that, they also received north of $16 million as their share of the expansion fee proceeds.

          But typically, the Hurricanes have been a money-losing proposition and a large part of whatever the announced purchase price for Dundon will include taking on some of the team’s debt…”

          So, no, the team is not profitable under anything but extraordinary circumstances (like being guaranteed $18m in revenue sharing from other teams AND getting $16m in expansion revenue from the LV expansion).

          This is not profitability in any meaningful sense of the word. It is the equivalent of saying “my business turned a profit last year, but only because I received a one time payment as a result of selling part of my business off (expansion) and also received a bailout check from the government (revenue sharing).

          The Hurricanes turned a “profit” in 2017-18 solely because they received some $35m in payments from other entities outside their core business, which is operating a hockey team in Raleigh.

          The only up side to this is that they aren’t the Coyotes, who would not have broken even with $18m in guaranteed revenue sharing and $16m in expansion fee share paid in one season (but probably came close… much like the Canes turned a “slight” profit, if you squint really hard and ignore some uncomfortable facts about where their revenue came from).

          Karmanos lost money on operations for years… depending on how much of the accrued debt the new owner will absorb (rather than Karmanos paying it directly then selling the team for unencumbered), he may not have received the windfall from capital appreciation everyone seems to think. I’m sure he made money on his Whalers purchase & sale however.

          Announced selling price and the actual amount of money that changes hands are often very, very different.

          • Government? Not so much. That analogy doesn’t work because the government isn’t only made up of people connected to one specific industry. It’s more like if the big banks had been forced to bail out the smaller ones.

            Other than that I agree. The Canes have not been profitable, and locating them in a college town was probably not the brightest of ideas.

          • The league office is effectively the government for the league’s member teams. The money comes from a central pot contributed to effectively by all (though not equally among teams). This makes revenue sharing roughly analogous to taxpayer money if the only taxpayers are the 31 league members.

      • Ship the Yotes to Portland, the Canes or Panthers to Quebec city, and the other from the Canes/Panthers pair to… who the hell knows? Hamilton?

        • I’d be all for that. Hamilton happens to have an NHL legacy, too.

          I’d say stick with Portland and QC at first though and see if the Canes can make it work.

        • The only guy that would have spent the bucks on bringing the NHL to Portland is dead—Paul Allen. The new majority Coyotes owner may have less patience than Barroway and may soon pull the Houston card if they can’t strike a deal with the Indians for Salt River Pima land and can’t mack the AZ legislature out of $$$.

          The Canes can finally shut Quebec up if revenue sustainability doesn’t pick up in Raleigh.

  5. Trust me the Angels will not be going to Tustin.
    I live in Irvine and there is nowhere and especially no momentum, let alone money for a Tustin baseball stadium.

    This would be like Irwindsle with the Raiders, just a pawn to be used.

      • Anaheim should put the stadium and land up for sale to the highest bidder. I am pretty sure Disney is looking for land for future expansion or a new park and would be willing to pay a decent price for the land. If the Angels want to stay beyond 2020, they can work out a lease agreement with the new land owner.

  6. I have to give the Jaguars partial credit for not claiming they’re playing in a 90 year old stadium. Unlike the Braves who claimed Turner Field was only meant to be used for two weeks, when it was always designed to be a baseball stadium after the olympics were over.

  7. AT&T Park has been that since 2006. I think the first name change in 13 years is pretty easy to keep track of. And IMO, Oracle is a much better sounding name and is definitely more Bay Area-centric. KInd of wish all the local venues carried sponsor names with regional relevance, whether that is a company actually based here (Oracle, Levi’s) or one associated with industry here (Oracle, SAP).

    • “Sponsor names with regional relevance” is definitely a phrase from a dystopian near-future science fiction novel.

      • The Cow Palace is, to my knowledge, the only arena named in honor of opposition to public funding of arenas.

        The original name was the California State Livestock Pavilion but when proposed in the middle of the Great Depression an editorial writer for a local paper wrote “Why, when people are starving, should money be spent on a ‘palace for cows’?” The name stuck.

        • That is indeed truly amazing. Here’s some documentary evidence:

          https://cdnc.ucr.edu/cgi-bin/cdnc?a=d&d=SN19350705.2.25&srpos=6&e=——-en–50–1-byDA-txt-txIN-%22Cow+Palace%22——-1

    • Seattle has a renamed baseball place, sadly not Starbucks Grounds.

      “Sponsor names with regional relevance” is definitely a phrase from a dystopian near-future science fiction novel.
      -See Rollerball. The original one, it’s not a great movie, but it’s a ok movie that hasn’t been made wrong with the passage of time.

      • The original Rollerball had brilliant stunt work and an interesting theme revolving around the use of the sport as a means of reinforcing the futility of fighting the corporate state.

  8. Forbes Mike Ozanian Business Podcast On Arizona

    https://soundcloud.com/user-212019771/mike-ozanian-financial-ownership-situation

  9. Nice to see that the Jacksonville article also parrots the continued NFL lie that St. Louis was not willing to build the Rams a new stadium.
    There was a stadium proposal on the table that the Rams walked away from. Granted, I’m happy we didn’t fork over millions or billions to a multi-billionaire, but let’s not lie about what was offered, nor that the NFL approved the Rams walking away from the table to LA.

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