UK just closed soccer stadiums to fans for virus rates that wouldn’t bat an eye in most US states

Bad news if you’re an English soccer fan who was hoping to, say, check out one of those crazy high-scoring Leeds United games in person: Plans to reopen British soccer stadiums at limited capacity on October 1 have been scuttled by the U.K.’s fast-rising Covid rates.

Speaking to the BBC on Tuesday, cabinet office minister Michael Gove said that the Oct. 1 plans will now be paused.

“We were looking at a staged programme of more people returning,” Gove said. “It wasn’t going to be the case that we were going to have stadiums thronged with fans.

“We’re looking at how we can, for the moment, pause that programme, but what we do want to do is to make sure that, as and when circumstances allow, get more people back.”

Britain is indeed seeing a surge in Covid cases, even if predictions of 50,000 cases a day by mid-October assume that current rates of exponential growth continue, which even the government scientist who made the prediction called “quite a big if.” Here, check out the rolling seven-day average chart of new cases per capita:

That’s very ungood, and looks a lot like the abrupt rise back in March that led the U.K. to shut down stadiums and pretty much everything else in the first place, so good public health policy there!

But it does make one wonder: How do those wild Covid case rates in Britain compare to those in U.S. states that are allowing sports stadiums to admit fans? The current U.K. rate (against, seven-day rolling average) is 59.1 new cases per day per million residents; looking at which U.S. states are above that rate, we get, let’s see:

Gah! That’s 29 states plus the District of Columbia, if you don’t want to have to count for yourself. And even if not all those states are currently seeing upswings in positive tests, many are: Missouri, for example, which was the site of the very first NFL game of the season to allow fans, and where some fans were subsequently ordered to quarantine because they sat near a fan who subsequently tested positive. Missouri currently has a new-case rate of 238.8 cases per day per million, which is more than quadruple what’s led Britain to close its stadiums.

None of which makes open-air stadium attendance any more (or less) dangerous than we’ve discussed here before. But the best way to have safe public events during a pandemic, it’s extremely clear, is to tamp down the pandemic as far as possible, since it’s tough to catch a virus from a fan neighbor who isn’t infected in the first place. This isn’t to say there shouldn’t be universal precautions — masks are still good — but things like allowing fans into stadiums (or reopening indoor dining, where people are taking their masks off to eat and breathing the same air and really, it skeeves me out just thinking about it) should really be reserved for places where the virus rates are very low, like, yeah, New Zealand still looks good. Maybe the entire NFL should relocate there for 2020, if New Zealand would let germy Americans in, which you know it won’t.

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NYC to refinance Yankee Stadium bonds, give Steinbrenner more cash, still not require him to pay property taxes

And in bond refinancing news:

Fitch Ratings released a report saying the New York City Industrial Development Agency (NYCIDA) plans to issue approximately $923 million in PILOT (payment in lieu of taxes) Revenue Refunding Bonds, Series 2020, issued for the benefit of Yankee Stadium LLC. The 2020 bonds will provide significant debt service savings relative to the prior schedules, with the majority of savings related to the PILOT and debt payments in February 2022-2024.

If the words “bond refinancing news” didn’t already put you to sleep, that paragraph probably did. But there are a couple of items that make New York City and the Yankees refinancing their stadium debt to take advantage of low interest rates more interesting than when you do it for your mortgage:

  • First off, Forbes reports that while the Yankees will still be paying off their stadium debt with pretend property taxes in order to take advantage of a now-closed IRS tax loophole, they’ll now be able to pocket any excess PILOTs (payments in lieu of property taxes) that aren’t needed for debt service and use them to fund their own operating expenses — which Forbes’ Mike Ozanian notes “provides some mitigation on the pressure for a quick recovery in revenues from the coronavirus.” (Translation: Will help boost Hal Steinbrenner’s bottom line.) There’s no estimate provided for how much money will be redirected from the city to the Yankees under this new provision.
  • As you may recall, there’s a push on to make New York’s sports teams actually pay property tax, as opposed to paying pretend taxes to themselves (as the Yankees, Mets, and Brooklyn Nets do) or just having themselves declared entirely tax-exempt (the Knicks and Rangers). One snag there is that the PILOT agreements were already signed years ago, so it’s tough to undo them. But! In order to refinance the debt so that Steinbrenner can save money, the city and the Yankees are having to tear up the old PILOT agreement and sign new ones — and there is nothing stopping the city from saying, “And while we’re doing you this favor, how about you start paying some damn real taxes to the actual damn city treasury, what with New York so strapped for cash that the mayor is furloughing himself?”

Obviously if the city tried to demand more in tax payments from the Yankees than they’d be saving under the refinancing, Steinbrenner would walk away from this deal. Why that would be a problem for the city is left unstated, though — while the Forbes headline implies that New York will be saving money under this deal, it’s unclear how that will happen, since right now all the bond payments are technically on the Yankees’ dime, with the help of the $1.2 billion in public tax breaks and free land they’re getting on the back end. At the very least, you’d hope that Mayor Bill de Blasio — who just this week declared that in terms of sports tax breaks “everything should be reevaluated especially at a point when the city is going to need resources for our recovery” — would be, you know, checking to see if the city can get something in exchange for doing Steinbrenner this solid, instead of just giving the Yankees some extra cash to help pay their light bill.

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Does MLB’s postseason bubble format make any damn sense? An investigation

After much speculation, it’s official: MLB will be going to a “bubble” format for most of its postseason, isolating players and staff at a handful of locations to try to avoid any Covid outbreaks like the ones that disrupted many teams’ regular seasons. After the first round of best-of-three series takes place at teams’ regular home parks, the National League Division Series will be held at Arlington and Houston and American League Division Series will be in San Diego and Los Angeles, followed by League Championship Series in Arlington and San Diego, then a World Series in Arlington.

Going to a bubble makes sense: It’s worked well for the NBA and NHL, and does seem to be the best way to prevent outbreaks. And baseball has even thought through some of the problems of starting a bubble on the fly — players will have to start self-quarantining at their homes and hotels as early as next Tuesday, with their families joining them then in quarantine if they want to enter the bubble with them, though given that players are already not supposed to be out on the town, this pretty much comes down to “try extra-hard not to get sick right before the playoffs, guys.”

Playing in Southern California and Texas is more puzzling, though. Sure, they’re both warm-weather sites, though pretty much all of North America is relatively warm in October now thanks to climate change, except when it’s not. But they’re also both relatively high-virus states: Texas has begun to see a major second spike after its huge outbreak that began in June, and California isn’t far behind.

(That’s one-week new-case averages, but if you check 91-DIVOC you can see similar trends underway for positivity rates, so this isn’t just a matter of more people getting tested — there really is way more virus afoot in Texas and California than in states like New York and Massachusetts. And while a bubble in high-virus Florida worked okay for the NBA, it also didn’t have players traveling between cities.)

On top of that, warm weather hasn’t exactly been good for California lately, given that Los Angeles County just saw a record high temperature of 121 degrees and, oh yeah, the whole damn state is on fire. Maybe the wildfires will have died down by October, but wildfire season in Southern California usually lasts till the start of November, and thanks again to climate change is basically all year round now, so baseball could be risking a repeat of this week’s games in Seattle that had to be canceled after the Oakland A’s and Seattle Mariners played a doubleheader in a cloud of choking smoke.

The first thing that comes to mind is MLB’s longstanding tradition of rewarding team owners who’ve built or renovated stadiums with getting to host special events like the All-Star Game. The Texas Rangers‘ stadium, of course, only just opened this year, after winning close to half a billion dollars in city subsidies so they could have air-conditioning, while Dodger Stadium just got a $100 million renovation (at team expense), and in fact was in line to host the All-Star Game this summer before that got canceled. And once you’ve picked those two, the Houston Astros and San Diego Padres stadiums are relatively close to reduce travel, and also relatively new, though, man, Houston’s is 20 years old already? I guess Enron was a long time ago.

Texas has another advantage, though. MLB commissioner Rob Manfred had this to say yesterday at a sports business panel:

“I’m hopeful that [for] the World Series and the LCS we will have limited fan capacity,” Manfred said during a question-and-answer session through Hofstra’s Frank G. Zarb School of Business. Manfred’s comments were first reported by the Athletic. “I think it’s important for us to start back down [that] road. Obviously, it’ll be limited numbers, socially distanced, [with] protection provided for the fans in terms of temperature checks and the likes…

“But I do think it’s important as we look forward to 2021 to get back to the idea that live sports are safe. They’re generally outdoors, at least our games, and it’s something we can get back to.”

Whether live outdoor sports are safe for fans to attend in the middle of a pandemic outbreak is, of course, a huge open question, one that the NFL is currently attempting to answer via a giant human test subject experiment. Also, the Houston and Texas stadiums aren’t entirely outdoors — they both have retractable roofs, and in fact the roof is the entire reason for the Texas stadium existing — and while they probably still have better air circulation than a totally indoor arena, if the principle here is “it’s safe to let in fans so long as its outdoors,” shouldn’t Manfred have picked entirely outdoor stadiums? Hell, New York City has two of ’em, plus oodles of now-vacant hotel rooms.

Ah, but New York City also has bans on fans attending live sporting events, and Texas notably does not. And even at 25% capacity, selling tickets for the World Series — the only tickets that would be available for any MLB games this year — would be massively hot commodities, something that Manfred said later in his talk was at the forefront of baseball’s thoughts:

“The owners have made a massive economic investment in getting the game back on the field [in 2020] for the good of the game,” he said. “We need to be back in a situation where we can have fans in ballparks in order to sustain our business. It’s really that simple.”

So, yeah, it really is that simple: If we can sell tickets, that’s the priority, we’ll figure out the risks later.

Prioritizing money over safety also explains perhaps the biggest hole in the MLB bubble structure: The first-round games, which will be held in eight different cities, with no bubbles, right before the embubbled postseason begins. This Round of 16 was announced abruptly at the beginning of the season, and doesn’t make any more baseball sense than public health sense — three-game series in baseball have essentially random outcomes, especially now that home-field advantage maybe means nothing without fans (though maybe it still does?), so you’re subjecting regular-season division winners to virtually the same odds of making it to the next round as sub-.500 teams lucky enough to play in weak divisions. But it does mean a whole lot more TV money, enough that MLB was willing to cough up $393 million in postseason bonus money to the players’ union to make it happen.

And as Marc Normandin points out in today’s edition of his newsletter (this one un-paywalled, but please send him some money if you like it!), even before seeing whether this results in a bunch of third-place teams on hot streaks battling it out in the playoffs, Manfred is already eager to make this the new normal:

“Manfred also said the expanded, 16-team postseason is likely to remain beyond 2020, adding that “an overwhelming majority” of owners had already endorsed the concept before the pandemic.

“I think there’s a lot to commend it,” he said, “and it is one of those changes I hope will become a permanent part of our landscape.”

Normandin also points out that letting a thousand playoff teams bloom has an important side benefit for team owners who are sick of shelling out big bucks to buy the best team possible:

If the league was already full of teams aiming to win 83 games because it’s cheaper than trying to win 90 and they might get lucky and win 90, anyway, what is going to happen when the threshold for making the postseason drops? A bunch of teams looking to win 75 games and occasionally being rewarded for it because a prospect hits their stride sooner than expected, or an inexpensive, low-end free agent has a surprise epiphany and subsequent breakout? We’re going to end up in a scenario where owners know they’ll be getting increased shared revenue from an expanded postseason, and more revenue than that if their teams manage to make it there themselves. And little incentive to spend any of that increased revenue, because why try when not trying might get you to the postseason, anyway?

In other words, if you loved the marginal revenue gap that has allowed owners to pocket even more money without having to collude about it, it’s about to get that much bigger.

MLB’s bubble postseason, in short, is one part profiteering and one part just enough concern for the public to seem reasonable without getting in the way of the profiteering. Which is how baseball — and pretty much all pro sports in the U.S. — has always been run, so it should come as no surprise. But it’ll be something to keep in mind while watching the Toronto Blue Jays and San Francisco Giants battle it out for the World Series in Texas in front of 12,500 very well-heeled and well-air-conditioned fans.

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NYC Mayor de Blasio: Sure, wealthy sports owners should pay their taxes, I guess

As I mentioned in my Gothamist article last week, a group of New York city councilmembers have called on Mayor Bill de Blasio and Gov. Andrew Cuomo to start making the city’s sports teams pay property taxes on their stadiums and arenas, which none of them currently do. (The Yankees and Mets and Brooklyn Nets all pay “payments in lieu of taxes” that are really their own construction debt payments, funneled through the city as a tax dodge; the Knicks and Rangers don’t pay taxes on Madison Square Garden because somebody accidentally gave them an eternal tax break in 1982 and no one can be bothered to repeal it.) And the campaign got a boost yesterday when de Blasio sorta kinda endorsed its call for team owners to pay their fair tax share:

De Blasio, a Democrat, was asked at his daily press briefing to respond to a letter last month from nine lawmakers on the New York City Council who called for the Garden, Yankee Stadium, the Barclays Center and Citi Field to pay property taxes. The mayor said he hasn’t seen the letter and was unfamiliar with the legal specifics, but supported the concept of requiring New York’s local teams to increase their contributions.

“Let’s be clear – sports franchises have gained incredible value over the years,” de Blasio said. “They clearly have the resources. I think the history in this city and pretty much all over the country was stadium deals were not good deals for the public, by and large. Some of the more recent ones have been better, but mostly they haven’t been that good. Everything should be reevaluated especially at a point when the city is going to need resources for our recovery.”

That phrasing puts the “blah” in de Blasio, but “everything should be reevaluated” is fightin’ words compared to the usual approach to sports tax breaks, which is for elected officials to shrug their shoulders and say whatchagonnado? And the mayor also responded to a call by 161st Street Business Improvement Director Cary Goodman that the Yankees be forced to pay property taxes just as other businesses in the neighborhood do:

“We all hope and pray that next year baseball will resume in person at some point in the year and the fans will come back and the businesses will thrive, but of course the Yankees should help them through and I assure you they have the money.”

Okay, so none of this is exactly laying down the law, and de Blasio has previously called for Madison Square Garden to pay taxes before shrugging his shoulders and saying whatchagonnado? But it’s still more than we’ve seen before, and is certain to encourage both the councilmembers and Goodman and his South Bronx business owners. The latter has a rally outside Yankee Stadium coming up this Thursday at noon, plus a Change.org petition, and with that and a long enough lever you never know what can happen.

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NFL season opens, bringing partially masked fans and completely masked stadium impact claims

The NFL season has started, something I mostly noticed because of the appearance of Defector’s (née Deadspin’s) “Why Your Team Sucks” series, and pretty much every news outlet in the U.S. had an article about how there were no fans in the stands and it was weird, something I am not going to bother recapping for you all because I already just did. Except in Jacksonville, that is, where this happened:

News4Jax reports that “officials were strict on the inside and made sure everyone followed the rules” and “News4Jax saw fans wearing masks except for when eating or drinking, and keeping distance in the stands from other pods,” which:

That looks to me more like “except when eating or drinking or talking to the person you’re probably not in a household with who is way less than six feet distanced from you,” but it’s something, anyway.

What the impact on Covid in getting-better-but-still-bad Florida (its death rate per capita is now second in the country), or on still-surging Missouri (where the Kansas City Chiefs allowed in fans for Thursday’s opener, which went not so well) is really hard to predict. That CDC study on restaurants was pretty clear that taking off masks to eat and drink is a major risk, though it’s conceivable that being outdoors will help mitigate that enough that it won’t cause an outbreak. It doesn’t look like anyone has tried to determine the impact of MLS games allowing in fans yet, and that study claiming Sturgis as a superspreader event has been largely debunked, so we’re left with things like that Champions League game in February in Italy, where nobody was masked or distanced or anything, so that’s tough to draw comparisons from. So allowing fans at NFL games is still a giant human experiment, one whose impact in all likelihood won’t be clear for a couple of months yet, at which point it will be too late to do anything about it, because that’s how modern humanity rolls.

Meanwhile, in Inglewood, the Los Angeles Rams opened their new $5-to-6-billion-ish stadium with no fans in attendance, but according the the Los Angeles Daily News’ headline, “a resurgent Inglewood has hope.” Number of Inglewood residents interviewed for the story: one.

“I haven’t felt this way since the first time my father brought me to a Rams game when I was 7 years old in the 1960s,” Inglewood Mayor James Butts said on Friday. “Even though we won’t have the crowds there’s going to be that same feeling because this is history being made.”

You can just smell the resurgence!

After all the vaportecture, I would be remiss if I didn’t include at least a couple of photos of the new Rams and Chargers stadium, so here’s a nicely postapocalyptic one, courtesy of USA Today:

And here’s a nice view of what the game would look like from the upper levels, if you were allowed to watch it from there:

https://twitter.com/ryinie/status/1305290842429480961?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1305290842429480961%7Ctwgr%5Eshare_3&ref_url=https%3A%2F%2Fwww.dailynews.com%2Fan-empty-sofi-stadium-hosts-first-la-rams-game-and-a-resurgent-inglewood-has-hope

Five billion dollars doesn’t buy what it used to.

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NY Rangers played a “home” game in Toronto without losing their MSG tax break, because reasons

Last week I was talking to a source for a story (mostly) unrelated to sports stadiums when they asked me a question: How come the New York Rangers‘ August “home” playoff game in Toronto as part of the NHL’s bubble didn’t count as a violation of the team’s tax exemption for Madison Square Garden, the one that reads:

If one or both of said teams [the New York Knicks or Rangers] shall cease to play their home games in said property at any time, the tax exemption provided herein shall cease immediately and such property shall immediately be restored to the tax rolls and thereupon become subject to taxation and shall be taxed pro rata for the unexpired portion of the taxable year.

Sure, it was just a single game, before the Rangers were unceremoniously bounced from the playoffs by the Carolina Hurricanes. But still, that clause had been enough of a concern that Rangers owner James Dolan made sure that for outdoor games at Yankee Stadium and Citi Field in 2014 and 2018, the Rangers were designated as the road team. So should that one-game sojourn in Toronto have triggered the automatic return of the Garden to the tax rolls, after $555 million in skipped tax payments?

The answer at first appeared to be “no one knows,” but further research revealed that it was actually “everybody says they know, but nobody can agree on an explanation,” which is far more entertaining. As I reported for Gothamist on Sunday:

The explanation from New York state is that “cease to play their home games in said property at any time” doesn’t mean what you think it means. State tax department spokesperson James Gazzale tells Gothamist, “The law is clear that the exemption continues until either team ceases to play home games at MSG—meaning a permanent stoppage, not a temporary relocation due to a global pandemic.” Asked why the Rangers then chose to play Winter Classic games as the road team, Gazzale declined to comment further.

Madison Square Garden officials, meanwhile, had a different explanation for why the Toronto trip was okay: Ed Koch said it would be. Garden officials confirmed a brief note in this New York Post article from July that an “original agreement” between the city and MSG excluded relocations due to Acts of God from triggering the tax renewal clause, but did not provide further details.

The actual agency that would be in the position of deciding to return MSG to the tax rolls, meanwhile, is the city Finance Department, which didn’t get back to me on any of my questions.

As I wrote for Gothamist, this would be a pretty picayune basis on which to make a decision worth hundreds of millions of dollars — but then, that’s exactly how the Garden ended up with its tax break in the first place, when someone neglected to include an end date even though it was intended to expire after a decade. Thirty-eight years later, the tax break is still going strong, and many New York officials are calling for it to be repealed. Just not on a technicality — that wouldn’t be cricket.

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Friday roundup: San Diego gets arena developer (and vaportecture), horses play piano, and other stories

Happy Sebtembler! Things were a little quiet for much of the summer, what with the entire world shut down and it seeming like a bad time for rich dudes to ask for hundreds of millions of dollars for their new buildings, but as Josh Harris has shown, nothing lasts forever. Except rich dudes asking for hundreds of millions of dollars for their new buildings, that will go on until the world actually ends, which is at least a few more decades away.

Anyhoo, here are some other things that happened this week in the world of stadium-grubbing:

  • San Diego Mayor Kevin Faulconer has chosen a team led by Brookfield Properties and ASM Global to build a new arena and associated development, with the arena to be paid for by building more housing units, somehow? Is housing that profitable that it can spin off hundreds of millions of dollars in extra revenue to pay for a new arena? If so, shouldn’t the city just be charging more for the right to build all this super-lucrative housing? This all sounds suspiciously reminiscent of the Los Angeles Angels land deal, except no one in San Diego politics or journalism seems interested in investigating how the money will actually work, so I’m clearly going to have to do some more digging and report back. In the meantime, jam everything but the kitchen sink into your sports venue deals, kids, it’s the best way to make sure sports reporters get bored by the financial details and wander off!
  • Let’s also not let the moment pass without commenting on San Diego’s new arena vaportecture, which mostly features … people shopping? People wearing, I guess those are San Diego Gulls t-shirts, some with the logo on the front and some on the back, depending on whether the shopper in question is walking toward or away from the camera. Do you think they coordinated that somehow? Also the Ostro Brasserie appears to be a branch of a restaurant in New Zealand, Ungar’s is a wholesaler of packaged pizza bagels, and Migdal is an Israeli insurance company. This is a really weird mall!
  • Sacramento is short on tax revenue to pay off bonds on its Kings arena and convention center, but honestly that’s just another way of saying that it spent a bunch of money that it didn’t need to and now the chickens are coming home to roost when “don’t worry, there’ll be plenty of tax money” isn’t working out so well. Would it be any better if the city had spent the same money on the arena and then received enough tax revenue to pay it off but couldn’t then use that money for other needed things? Please submit your persuasive essays in comments.
  • Big arenas are joining with smaller music venues in support of the RESTART Act, which would extend the Paycheck Protection Program to help companies pay their furloughed workers, and also provide Small Business Administration loans that would be forgivable for the amount of any losses that venues had in 2020. That doesn’t seem too terrible — music venues are indeed getting creamed by the shutdown, and will likely be among the last things to reopen — but at the same time, there are lots of funny things you can do with your books to show “losses,” so this is worth keeping at least one eye on, especially given that no one in power seems much interested in doing so.
  • I haven’t actually been able to get myself to finish reading this item about the Philadelphia 76ers arena subsidy plan, because I can’t get past its opening line: “Josh Harris is like a horse trying to play the piano… he hits every wrong note.” Is that really what a horse trying to play the piano would do, though? Wouldn’t it fall over from trying to stand on its two hind legs? Shatter the keys with its hooves? Now I can’t think of anything other than how horrifying for all concerned it would be to watch a horse trying to play the piano — pass the RESTART Act now, or we may never see such a sight again!
  • I wanna read this new book on the perils of sports fandom, and not just because I’m in it!

Have a good long weekend, everybody, if that’s still a concept that means anything, and see you back here on Tuesday refreshed and ready to go.

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Friday roundup: NFL teams debate which fans will be the first to enjoy socially distanced peeing

Pressed for time today, so while I’d love to comment on everything in the world that happened this crazy week, I’m just going to give you a link to my article on news coverage of the California fires and the state’s reliance on incarcerated people to fight them, then get straight to a quickie news recap:

  • The Cleveland Browns will reportedly “consider personal seat licenses” in determining who gets to attend reduced-capacity games this season, which isn’t very specific: Would season ticket holders with PSLs (which is almost all of them) get priority? Would those who spent more get let in first? One can only imagine the Browns front office debating which is the fairest solution, and/or which would help maximize team revenues, because you know that the latter is never very far from sports owners’ conception of the former.
  • If you’ve been jonesing for a picture of what socially distanced urinals will look like, Sports Illustrated has you covered.
  • Pittsburgh’s Sports & Exhibition Authority is, according to the Pittsburgh Post-Gazette, “requesting $7.4 million to COVID-19-proof Heinz Field, PNC Park, PPG Paints Arena and the David L. Lawrence Convention Center,” whatever “COVID-19-proof” means. (Lots of urinal covers?)
  • There are new reports estimating the costs to the local economy of spring training in Arizona ending early and the Oklahoma City Thunder season ending early and do you think either of them looked at what, say, sales-tax receipts actually did starting in March, or did they just project out how much money is normally spent at these events and assume that it all vanished into thin air once they were canceled? (If you guessed door #2, congratulations, you can skip journalism school and go directly to a newspaper job, if newspapers or jobs still existed.)
  • No huge new revelations in this week’s Epoch Times report on the Los Angeles Angels stadium deal, but it’s a decent roundup and there sure is a ton of me in it, so check it out if you like. (EDIT: Or actually maybe don’t, if you don’t want to support QAnon and anti-vaxxer conspiracy theories. If you want to know what I said, I’ll post it in comments.)
  • This German study of how people’s breath spreads at an indoor concert is kind of genius, and everyone should be watching to see the results if we ever want to be able to attend indoor events again, whether masked or distanced or ventilated with HEPA filters or what. Results are due in four to six weeks, so stay tuned in early October for further updates.
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76ers owner vows no “direct” use of tax money for new waterfront arena while lobbying for massive tax kickbacks

I admit, it’s sometimes tough even for me to keep track of which stadiums and arenas are considered “new” or “old” — or “state-of-the-art” and “outmoded,” as sports team owners like to say. The Philadelphia Flyers and 76ersWells Fargo Center still feels new to me, but it’s 24 years old this month, so naturally one of those teams is already plotting how to leave for an even newer home:

The 76ers are exploring the possibility of building a new basketball arena at Penn’s Landing, and the team is lobbying local officials to get behind a plan to help finance construction with taxpayer support, The Inquirer has learned.

The proposal, sure to spark intense debate, is the latest in a long history of disputes over how to revitalize the Delaware River waterfront and where to put sports complexes in Philadelphia. The team wants to move out of the Wells Fargo Center, which it shares with the Flyers and which is owned by Comcast Spectacor, by the 2031 season, according to a planning document viewed by The Inquirer. The document is a draft of talking points for the Sixers’ lobbying efforts.

The Sixers rent from the Flyers, and have engaged in a series of squabbles over the years with their landlord, most memorably printing the arena’s corporate name in teeny tiny type because they weren’t sharing in the naming-rights cash. This, though, is the first concrete proposal for a new arena that’s been submitted to Philadelphia officials, and presumably the start of a long lobbying war by the team’s billionaire owner, Josh Harris.

More details on that “planning document,” from Philadelphia Business Journal:

A team document prepared to garner support for the project and shared with the Philadelphia Business Journal by an industry source states the franchise believes a new Penn’s Landing arena will:

  • Provide “billions of dollars in net new revenue to the city and the school for a property that currently produces no tax revenues” for the city or the state of Pennsylvania;

  • Create “thousands of new jobs, and provide significant new tax revenue” for the city and school district;

  • Include the creation of schools, parks and an African-American Museum at Penn’s Landing; and

  • Directly invest “unprecedented funds” in minority-owned businesses.

CBS Philly further reports that “the Sixers say they do not envision seeking any direct appropriation of city or state taxpayer money to support the project,” but the original Philadelphia Inquirer reports makes clear that that’s not true, unless you put a lot of weight on that adjective “direct”: Harris intended to apply for money from Pennsylvania’s Neighborhood Improvement Zone program, which siphons off future sales and income tax revenues from a large swath of land to pay off construction costs on a project — a STIF, in other words. The NIZ program was created in 2009 specifically so that Allentown could use future tax money to subsidize a new minor-league hockey arena, which ended up going massively over budget; the tax zone has been generating plenty of revenue to pay off the inflated costs, but that’s only if you count all the sales and income taxes collected anywhere near the arena to be new revenue, which it almost certainly is not.

In any case, Harris has clearly thrown down the gauntlet here, and it is one with “no new taxes!*” written on one side and “lots of new jobs!*” on the other. The opposing position has been staked out on Twitter by Philadelphia city councilmember Helen Gym:

https://twitter.com/HelenGymPHL/status/1298725255691689987

https://twitter.com/HelenGymPHL/status/1298734815412453377

To all those journalists who ask me periodically if I think the sports subsidy swindles are going to come to an end anytime soon: HELL NO. Why would billionaire sports owners stop demanding taxpayer subsidies now? It’s where the money is.

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Roughly 7,000 Falcons fans have now defaulted on their PSLs, because PSLs are kinda garbage

Journalism may be dead and all, but the Atlanta Journal-Constitution is still giving it the old college try, today by publishing the results of their latest public records request into how many Atlanta Falcons season ticket holders are defaulting on their personal seat licenses, eating the payments they made already to avoid having to make any more. And the answer is a whole heck of a lot:

About 7,000 Falcons season-ticket account holders have defaulted on their seat licenses since 2016, records show, with the vast majority of those accounts representing two or more seats. About 650 of the account holders who defaulted later returned as PSL owners.

Records show that seat-license purchases made before the 71,000-seat stadium opened in August 2017 totaled $299.1 million, including interest added to accounts annually. Of that, $196.5 million had been paid as of June 30, and after the $42.9 million in defaults, $59.7 million remains outstanding (plus future interest).

The total “default write-off balance” of $42,933,454 as of June 30 was up from $32,001,679 as of one year earlier.

That’s a lot of numbers, so let’s break them down a bit. When the Falcons built their new stadium — with the help of more than half a billion dollars in taxpayer money — they forced fans to plunk down anywhere between $500 and $45,000 for the right to buy tickets to sit beneath the glory of Megatron’s Butthole. The magic of PSLs, though, was that if fans decided they didn’t want the tickets, they could sell their ticket rights to someone else.

At least 7,000 Falcons fans, representing perhaps double that in total seats, have instead decided over the past four years to just walk away from their seat rights, which the AJC notes “apparently reflect[s] the difficulty in finding buyers.” It probably doesn’t help that the Falcons have been aggressively mediocre the last couple of years, but they made the Super Bowl as recently as 2017, and anyway, no team is very good or very bad for long in today’s NFL. (Okay, no non-Cleveland Browns team.) And while the pandemic undoubtedly isn’t helping, the $10 million in defaults from July 2019 to June 2020 are right on pace with the previous three years.

The bigger issue appears to be something we’ve already seen in other NFL cities, which is that PSLs are kind of a scam. Despite the promise that they’re an investment, not an added cost on top of your actual ticket fees, way too often their resale value plummets soon after purchase, to the point where even finding a buyer may seem like less trouble than just stopping annual payments and eating what you’ve spent so far. Some fans appear to be catching on — the Los Angeles Chargers had to massively downgrade their expected PSL sales after it turned out no one really wanted to buy them (or just that there are no Los Angeles Chargers fans), and even the Falcons had more trouble selling them than they’d hoped. But even if they don’t always raise as much as team owners hope, PSLs are still worth it, since they’re essentially free money: Making a waitlist of fans for season tickets never used to generate any revenue until Max Muhleman accidentally invented them.

None of this is illegal, obviously, and in a “let the buyer beware” sense, it’s not even unethical, since you’re only scamming people who fail to understand that sale price doesn’t necessarily reflect actual market value. (And PSL money has enabled team owners to put up more capital toward stadium expenses, though as we saw with the Falcons, it hasn’t stopped them from demanding plenty of public cash as well.) Still, you have to wonder how long NFL owners will be able to keep on charging fans twice for the same product, especially as people get more used to sitting at home and watching TV, something that started before Covid but is only likely to accelerate now. Time for team owners to start demanding new stadiums with smaller capacity, you think? As with the PSL racket, you can’t get if you don’t ask.

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