Oakland A’s owner John Fisher has been trying to build a new stadium forever, and for just as long he’s been insisting he’ll do it entirely with private money. So, ruh-roh:
Legislation that would help the City of Oakland finance infrastructure and transportation projects for a new ballpark at Howard Terminal was approved Monday by the State Senate…
The bill would allow Oakland to create an infrastructure financing district for the roughly 50-acre waterfront property where the Oakland Athletics intend to build a 35,000-seat ballpark, 3,000 units of housing, in addition, to retail and office space.
“Any financing that emanates from the district would not be used for the actual stadium itself. That is going to be privately financed,” [state Sen. Nancy] Skinner said on the state senate floor. “but rather for the other transportation and other infrastructure that may be needed at the site.”
So, okay, if you’re new to this whole development subsidy thing, “transportation and other infrastructure” could mean stuff that genuinely has nothing to do with an A’s stadium, or at least only tangentially benefits it while also benefitting the whole area; or it could mean “everything about the stadium that isn’t actually holding up the seats.” It’s always tough to say until you see the actual funding plan, and we don’t have that for the A’s. The actual bill appears to leave it up to the city of Oakland how big to draw the tax increment financing district, and what to spend the money on, so that’s no help either.
(And if you’re new to tax increment financing, it’s basically kicking back taxes from a new development to help pay for part of the development’s costs. It doesn’t usually work out too good.)
The A’s planned Howard Terminal site will have lots of environmental cleanup costs, but team execs say they’re going to pay for those; in fact, team president Dave Kaval went so far as to say back in February, “There are going to be a lot of infrastructure costs on the site, whether it’s transportation, whether it’s sea level rise, whether it’s environmental mitigation. Those are all things that as part of the project, we’re willing to pay for.” And by “the site” Kaval meant the whole site, including other development, so … beats me, man.
As for how much tax could be redirected to this infrastructure fund, it depends on how big a TIF district Oakland approves. If we wild-ass-guesstimate a $1 billion development, though, and the effective property tax rate in Oakland is a little under 1.5%, then over 30 years, in present value … we could maybe be talking about $200 million or more. Probably less than that given that you’d have to deduct the current value of Howard Terminal land, but still, likely somewhere in the low nine figures. Maybe.
This is all exceeding hand-wavy, obviously, and really you’d want an Oakland City Hall reporter who’s on the scene (or at least in the right time zone) to be asking these questions. All we know for sure is that Zennie Abraham claims he gave Kaval the idea for TIFs last year, though given that 1) the A’s owners were talking about TIF-like structures way back in 2006 and 2) Zennie Abraham has claimed lots of things, probably best to keep several large grains of salt on hand for that one as well.