Author Archives: Neil deMause

Friday roundup: St. Louis moves ahead on $51m in MLS subsidies, minor-league cities react to MLB annihilation plan, plus stadium traffic notes from all over

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Getting a late start today, so let’s just pretend I had something witty and informative to say in this intro paragraph and get on with the weekly news roundup:

  • The city of St. Louis has officially requested $30 million in state tax credits for the planned $250 million stadium for its expansion MLS team, on top of $21 million from three special taxing districts that will go to the team — all stuff we pretty much knew back in August, but now the paperwork is all being done. Anyway, the state credits are expected to be voted on a week from Tuesday, so if you want to yell at your local elected officials about this, get on the ball!
  • Noah Frank of WTOP has taken a long look at what MLB’s minor-league contraction plan will mean for teams and cities on the chopping block, and it’s not pretty: The Frederick Keys owners are “gobsmacked” to be on the hit list after leading the Carolina League in attendance in 2019, while the Erie SeaWolves got $12 million in stadium improvements last year and the Binghamton Rumble Ponies $5.1 million, and both could see their teams vaporized after 2020. Frank also notes (citing J.J. Cooper of Baseball America, who was the first to uncover this plan) that MLB’s claims that it spends $500 million annually on minor league players is more than a bit disingenuous, since that includes $416.5 million a year in draft bonuses and international signing bonuses that would continue under any contraction plan — the players who’d be cut would be the cheap ones at the end of the draft, so really MLB would only save chump change in this deal.
  • Add New York Congressional Rep. Max Rose (whose district includes the targeted Staten Island Yankees) and Connecticut Gov. Ned Lamont (whose state includes the targeted Connecticut Tigers) to the list of elected officials griping about the minor-league contraction plan, not that it’ll do much good unless it threatens MLB’s antitrust exemption. (Rose has a say on that, Lamont none at all.)
  • The California Air Resources Board has okayed the Los Angeles Clippers‘ arena plan’s greenhouse-gas-mitigation plan, saying installing install 1,330 electric vehicle chargers, adding 93 bike parking spaces, buying two electric buses and 10 electric vehicles for they city, and planting 1,000 trees is enough of a measure to reduce carbon output from fans going to the games. (A Natural Resources Defense Council attorney called the measures “pretty much a joke,” noting that most fans will still choose to drive to games as usual.) Once signed by Gov. Gavin Newsom, the approval means all environmental lawsuits against the project need to be resolved in nine months, which would be more significant if the two main lawsuits still outstanding against the arena had anything to do with environmental impact.
  • A $200 million highway project to make it easier to drive to the new Las Vegas Raiders stadium won’t have its first piece open until 2021, a year after the stadium opens, and won’t be complete until 2024. Meanwhile, if you’re thinking, “Wait, Nevada is spending $200 million on highway improvements on top of $750 million for the stadium?”, rest assured that the Las Vegas Review-Journal says, “The project was in the works even before the Raiders’ relocation to Las Vegas was whispered about, and it does not create any additional fiscal impact on the state Department of Transportation. But the timeline was accelerated once the $2 billion stadium, near I-15 and Russell Road, became a reality.” And spending money now doesn’t cost any more than spending money later, right? (Also, guess Nevada doesn’t have any laws about trying to reduce the number of cars on roads, huh?)
  • In related (and better?) new, those broken roof support bolts in the new Las Vegas Raiders stadium aren’t actually flawed, they were just overtightened, according to team officials. This project gets more and more like assembling an Ikea cabinet every day.
  • The Cincinnati Bengals suck and no one wants to see them play, and the Atlanta Falcons suck and no one wants to see them play. Apparently we’re going to spend the rest of our lives looking at photos of half-empty stadiums and noting that fans don’t like to watch their teams lose; somewhere Red Barber is looking down and thinking that he was born 50 years too soon.
  • It’s rare that we get a report of how much it costs for local government to provide emergency services for a sports venue (something that would normally be paid for by property taxes, except that most stadiums and arenas don’t pay property taxes thanks to being publicly owned), so it’s interesting to see that the Palm Springs fire and police departments say they’ll need nearly $20 million in new equipment and $3.6 million a year in operating costs to cover services for the city’s planned minor-league hockey arena — sure, it’s their own estimates and they have an incentive to ask for as much as possible, but still it’s probably within an order of magnitude of reality.
  • Here’s a Forbes unpaid contributor article about stadium innovations of 2019 that starts by claiming that private sports venue funding causes “ticket and associated prices” to climb, hurting fans. This is completely wrong in terms of both empirical data and economic theory — does anyone really think that owners with subsidized stadiums pull back on raising ticket prices as much as the market will bear, just because they already have someone else footing their construction tab? — and so I stopped reading there, but if you want to plod ahead to the end, it’s your funeral.
  • The $290 million Calgary Flames arena-subsidy deal is finally signed off on, so forget all your fantasies of taking the money and using it for transit and housing instead.
  • Now that the Los Angeles Angels won’t be moving to Long Beach, the city of Long Beach needs to figure out what to do with the proposed stadium site that was way too small for a stadium anyway, say city officials. And so do development plans spring fully formed from rotting meat.

Angels’ $325m stadium land deal, day two: Still more questions than answers

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I was hoping by this morning we’d know more about the proposed $325 million Los Angeles Angels stadium land purchase deal with Anaheim that would answer some of yesterday’s unanswered questions, like whether the team would pay full property taxes,  and what kind of sale-price breaks would be allowed if the team builds parks and affordable housing, etc. Unfortunately, so far today’s news coverage hasn’t shed much more light on these issues:

  • A Bill Shaikin article in the L.A. Times didn’t cover any new ground since yesterday, or even ask any new questions, preferring to focus on how “the city of Anaheim is on a pretty good run” with retaining its sports teams. (First bullet point: “So when do the Angels open their brand new, grand new [sic] stadium?“)
  • The O.C. Register’s Alicia Robinson stuck to he-said-she-said, with quotes from people calling the proposed deal a “home run” (councilmembers Lucille Kring and Trevor O’Neil) and those who still have concerns (councilmember Jose Moreno, me).
  • The Voice of OC’s Spencer Custodio posted an article focused on the secrecy with which the council negotiated this deal — the paper’s lawyer, open government attorney Kelly Aviles, said this seems like an obvious violation of the Brown Act, the state’s transparency law — but didn’t have much more on the questions left hanging by the city’s perfunctory three-page summary.

Yesterday afternoon did see the release of the appraisal of the Angels’ stadium-plus-parking-lot land, but that wasn’t super-clear either: It determined a “Range of Hypothetical Prospective Fair Market Value” for the site of between $300 million and $320 million — but then laid out more specific examples that provided a range of values between $134 million and $500 million, so it’s not totally apparent where the $300-320 million determination comes from. It still makes the $325 million sale price at least not too far off from fair market value, but when “not too far off” could potentially mean leaving $175 million on the table, you really want to make sure all the t’s are crossed.

One reporter I spoke to indicated that it was their understanding that Angels owner Arte Moreno will pay property taxes on the site, though I haven’t seen that in writing yet. If so, the main concern would be those deductions from the sale price that Moreno would be eligible for in exchange for building parks and affordable housing; as I told Custodio, while there’s some logic to Moreno getting to claim credits for building stuff that would otherwise be on the public’s dime, sometimes developers choose to build things that are public benefits because they’ll also benefit them, so getting that benefit and a land price discount too would effectively be double-dipping.

It’s too soon to be super-negative about this deal — $325 million is a hell of a lot more than the $1 Moreno wanted to pay back in 2013 — but it’s also too soon to say whether it’s a good deal for the public without knowing how all the finances will work. And it’s definitely a concern that this process is being rushed through without much time for public or council debate, with a final vote now likely before the holidays. Those unanswered questions are big ones, and the clock is ticking.

St. Pete mayor declares talks of new Rays stadium before 2028 “concluded,” but not talks before 2028 of new Rays stadium (read it again, you’ll get it)

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Back six weeks ago when St. Petersburg Mayor Rick Kriseman was saying it was no big deal if Tampa Bay Rays owner Stuart Sternberg wanted to look at moving his team before his lease expires at the end of 2027 — despite a lease clause explicitly prohibiting that — it looked like Kriseman was all set on playing good cop in the team’s stadium squabble, possibly with an eye toward getting hold of the land under the team’s current home of Tropicana Field. Now not so much, as Kriseman has declared that the Rays leaving before 2027 is something up with which he will not put:

Kriseman told city council members in a letter that negotiations over the Rays’ pitch to split the season between St. Petersburg and Montreal have concluded. The mayor added that team officials declined a new offer to renew the memo of understanding that would’ve allowed the team to explore a future full-time stadium in the Tampa Bay area — not just in St. Pete or Pinellas County.

Here’s the full letter from Kriseman, of which the key paragraphs are:

Negotiations between the City of St. Petersburg and the Tampa Bay Rays Organization related to the ‘shared season’ concept have concluded. Both parties have agreed that the best path forward is to abide by the existing use agreement with the understanding that the agreement allows for the Rays Organization to explore post-2027 split or full season opportunities, both in St. Petersburg and elsewhere.
In accordance with the existing use agreement, should the Rays Organization wish to continue exploration of the shared season concept with Montreal, that exploration must be limited to the 2028 season and beyond.

Okay, so what does this all mean? The Rays’ lease prohibits the team’s owner from so much as talking to other cities about moving any home games out of St. Pete before 2028 — which would rule out the team moving to Tampa across the bay, or moving half its games to Montreal, or anything else that didn’t keep 100% of Rays home games in their current city. But it’s only the move that can’t happen before 2028, not the talks: Thanks to a late amendment to the Rays’ 1996 lease, Sternberg can talk all he want about new stadiums elsewhere, he just can’t do so with a goal of moving there before 2028.

Which, honestly, at this point is pretty unlikely anyway: Neither Tampa nor Montreal nor any other prospective Rays relocation city has anything close to a stadium plan in place, so when you add the time it would take to put financing together to the time it would take to build a whole new ballpark, you’re already about halfway to 2028. All Kriseman has done here is to say to Sternberg, “If you want a new stadium sooner than eight years from now, you’ll have to do so in St. Pete,” which honestly isn’t a terrible use of what leverage he has. (Assuming that keeping the Rays in St. Pete is really what’s best for St. Pete, which given the tremendous public subsidies Sternberg is looking for may not be the case at all.)

It also means that fears that this will immediately drive the Rays out of town — hey there, Tampa Bay Times sports columnist John Romano — are almost certainly overblown, because not allowing the team to leave town until 2028 doesn’t actually make it harder for the team to leave town. Sternberg will now almost certainly continue talks with Montreal and Tampa and anywhere else with an eye toward 2028, but will presumably continue them with St. Petersburg as well — unless he chooses to cut off Kriseman out of spite, which would be a dangerous thing to do in a game with only so many bidders. Sternberg’s calculus remains the same: Stay put in a metro area with a decent-sized media market but a crappy attendance record or relocate to a smaller market (or in Montreal’s case, another decent-sized market with its own historic attendance woes) and roll the dice that this will make you more money.

I expect that Sternberg’s decision, much like the MLB decision that stripped Montreal of the Expos in the first place in 2004, will ultimately have a lot to do with who offers the most lucrative stadium deal, which right now is “nobody.” This Kriseman gambit definitely makes things interesting, but I imagine it’s going to be years before we know how, or if, it affects the Rays’ ultimate fate.

Report: Angels offer to buy stadium and surrounding land from Anaheim for $325m, so is this a good deal or what?

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The Anaheim city council met last night to go over the Los Angeles Angels stadium renovation and lease extension plan, and came out promising to finally reveal the city’s land valuation of the Angel Stadium site that team owner Arte Moreno wants to develop. Only somebody jumped the gun and leaked details of the team’s actual offer to the O.C. Register:

Anaheim’s hometown baseball team would continue playing in Angel Stadium for another 30 years, and the city would sell the stadium and 133 acres around it to a business partnership including team owner Arte Moreno for about $325 million, under the proposed outline of a deal that Anaheim City Council members were briefed on Tuesday, Dec. 3…

“For every fan who told us to keep the Angels, this proposal would do exactly that,” Mayor Harry Sidhu said in a statement. “This proposal reflects what we’ve heard from the community – keep the Angels, a fair land price, money for neighborhoods, ongoing revenue, affordable housing, parks and jobs for Anaheim.”…

Angels officials are still considering whether to renovate the stadium or build a new one, team spokeswoman Marie Garvey said. They’ve hired HKS Architects – which designed Minneapolis’ recently opened NFL stadium and is working on a new ballpark for the Texas Rangers – to explore their options.

Okay, so would it actually be a fair land price? There are still a bunch of big questions that the Register story leaves unanswered:

  • What’s the land valuation on that appraisal? The last appraisal, in 2014, came up with a figure of $325 million, so this would seem to be slightly light given inflation in the real estate market since then, but in the (sorry) ballpark. But we should know more this afternoon.
  • Would selling the land mean no more rent payments from the team to the city? Though given that the city gets pretty much nothing from the stadium now, that’s not much of a loss.
  • If the Angels are outright buying the land, does this mean they’d start paying property taxes on it? If so, this could be a huge benefit for Anaheim; if not, then that’s a tax break there, friends.
  • The Register writes that “the [affordable] housing and parks would be given a dollar value that would be subtracted from the land’s selling price” — so does this mean that the team can build affordable housing and parks on its land and claim this as an in-kind payment to reduce its land price? If so, who’s going to be determining that dollar value, and what recourse is there if Moreno tries to claim this his parks are so nice that they’re worth $325 million?

The Register gives no indication of whether its reporters saw the actual agreement or just got some cherry-picked highlights (the only sourcing note is to “city information”), so it’s really tough to know if we’re getting the whole picture here, or just the PR spin. More tomorrow morning after the appraisal is out and I’ve had time to read it, because that’s what journalists are supposed to do, read source materials and report back what they find, or at least so I always thought.

UPDATE: Spencer Custodio of Voice of OC points out that this entire story is apparently sourced to a three-page fact sheet on the city of Anaheim’s website, which is exactly as undetailed as you’d expect a three-page city fact sheet to be. Questions above answered: zero.

Manfred meets with Sanders about minor-league contraction, mumbles promise of “solutions” that will make everyone happy somehow

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Now here’s a sentence I didn’t expect to be writing this week: MLB commissioner Rob Manfred met with U.S. Senator and Democratic presidential candidate Bernie Sanders yesterday to talk about MLB’s plan to eliminate 42 minor league affiliates. Afterwards, Manfred issued a statement to the press:

Blah blah importance of professional baseball to communities blah blah obligation to local communities to ensure that public money spent on Minor League stadiums is done so prudently blah blah blah safe playing facilities blah blah we remain confident that solutions can be reached that satisfy the interests of all stakeholders.

In other words, there is no reason this cannot be all things to all people just because some people want the teams to stay and others want them to go away, why would you even think that?

Sanders replied something about how Manfred is “open to solutions” and added that he and other members of Congress will be “carefully monitoring the progress of negotiations on behalf of fans.” So yeah, the public statements at least are just a pro forma “we talked” notice, with no indication that any particular action will result. That’s likely going to turn on how careful that Congressional monitoring is, and how close it cuts to a potential revision of MLB’s antitrust exemption, which was put in place by the Supreme Court but which Congress can overturn with legislation — that Manfred found it necessary even to meet with Sanders shows he’s concerned about this, but that he issued such a perfunctory mealy-mouthed statement afterwards suggests that he’s not all that concerned, not yet, anyway.

Pawtucket proposes $70m-plus in tax kickbacks for $45m USL stadium

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There’s a winner in the competition to build on the riverfront site where the Pawtucket Red Sox turned up their noses at building a new stadium, and it’s … the crazy soccer stadium complex with the mountains in the background! (Helpfully blurred out in the latest rendering.) And according to the Providence Journal, while the USL stadium itself would only cost $45 million, the bigger project would stand to make a lot more than that in tax kickbacks:

The stadium would be the first piece of a larger, multi-part, mixed-use project Fortuitous is calling “Tidewater Landing,” that would take advantage of federal “Opportunity Zone” tax breaks…

The plan hinges on approximately $70 million to $90 million in public support, most of it from the state through a “tax increment financing” plan that allows the developer to use a portion of new tax revenue generated around the development to pay for construction. That total includes infrastructure like the pedestrian bridge, public parks and river walks on both banks of the Seekonk.

The bigger project includes 200 apartments, 100,000 square feet of shops and restaurants, a 200-room hotel with an “indoor sports event center,” and 200,000 square feet of office space, though it’s not clear whether all of that needs to be built in order for the tax subsidies to kick in. Also not clear: Where all of that $70-90 million would come from — the Journal says only $10 million would come from the city, so would some of it be state sales tax kickbacks? (Or maybe they mean that it would be $10 million in cash and the rest in tax increment financing, which somehow isn’t “city money” because Casino Night.) Also, why wouldn’t it require state legislative approval even if this would be a state-designated tax redirection zone. So many questions that the Journal could have answered, or at least asked!

All in all, this Pawtucket plan exemplifies a whole bunch of trends in the modern stadium game: throwing money at pro soccer because there’s a seemingly infinite number of available expansion franchises there (both in MLS and in the lower-level USL), providing public money via TIFs because it’s easier to pretend this is new money generated by the project even when it’s not, and the “kitchen sink” approach where you throw as many unrelated items into a development project as possible in order the muddy the financial waters to where everyone just throws up their hands at figuring out who’s being subsidized for what. Plus Opportunity Zones, the Trump-created tax break that is so confusing even tax experts aren’t sure how exactly it will end up working, and the ever-more-popular model of approving sports subsidies without legislative oversight. It’s the perfect crime. Er, downtown development project. I surely don’t know why I typed “crime.”

Calgary votes to raise taxes on homeowners rather than revisit Flames arena deal

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In case you were holding your breath to see if the Calgary city council might rethink its $200 million-plus Flames arena subsidy now that it was facing a $23.45 million budget shortfall and possibly having to make cuts to police, fire, and transit services … well, that was a bad idea, who told you to hold your breath for that?

Coun. Evan Woolley put forth the proposal that would have the city withdraw a $290 million total contribution for the arena, with $200 million going towards the troubled Green Line project, $45 million towards the construction of a new downtown Calgary police station and $45 million for deferred capital maintenance for Calgary Housing…

When the dust settled, councillors defeated the reconsideration 11-4.

Instead, the council voted to close the budget gap by raising taxes on residential property owners (while subjecting business owners to a smaller increase than they would otherwise have been) and eliminating the proposed budget cuts. One can argue about who should bear what share of the tax burden in Calgary, but that’s kind of beside the point for our purposes, which is to note that the city would have plenty of money to hold the line on taxes and maintain services if it weren’t shoveling so much toward a new private arena project, which is exactly what those four councillors on the losing side of the vote were pointing out. (Yes, some of that money is from projected future taxes from development surrounding the arena — but there’s plenty of reason to believe at least some of that money would arrive with or without the arena.) The cost of subsidizing sports venues isn’t just abstract dollar amounts — it has real effects on real people when the public cash is suddenly no longer available for other uses. There are many ways to define opportunity cost, but you can’t spend the same money twice is a reasonable shorthand.

Friday roundup: Congress gets riled up over minor-league contraction, Calgary official proposes redirecting Flames cash, plus what’s the deal with that Star Trek redevelopment bomb anyway?

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Happy Thanksgiving to our U.S. readers, who if they haven’t yet may want to read the New Yorker’s thoughtful takedown of the myths that the holiday was built on. Or there’s always the movie version, which has fewer historical details but is shorter and features a singing turkey.

And speaking of turkeys, how are our favorite stadium and arena deals faring this holiday week?

Calgary residents ask city to reconsider arena funding amid budget cuts, are rebuffed by mayor as “distracting”

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The city of Calgary is facing a $23.45 million budget shortfall that could result in cuts to police, fire, and transit services, and also spending $200 million or more on a new arena for the Flames. What to do, what to do?

Some councillors, including Evan Woolley and Jeromy Farkas, have said that as the city looks for cuts in this year’s difficult budget “everything should be on the table” — including the arena deal…

Farkas argued that as there’s still no signed agreement between the city and the Calgary Flames owners, he’d like to see the arena deal revisited.

That’s an idea! And even one that a local economist had suggested earlier this month. But a voice is speaking up in defense of the subsidy deal that was agreed to this past summer after just one week of debate, and if you’ve been in a coma for the last year, the name will likely surprise you:

Mayor Naheed Nenshi said he thinks talk of reconsidering the deal is “distracting.”

“On the arena, we had a very comprehensive public debate, and ultimately, council decided to move forward,” he said. “That is a decision council has made, and frankly nothing has changed in the economy between July and now that would make me say, ‘We’ve got to rethink our capital projects.’”

That’s right: Naheed Nenshi, erstwhile member of the Gang of Four and the man Flames execs tried to force out as mayor because of his opposition to arena funding and declared “worse than Trump” when they failed, is now the leading defender of giving tax money to the Flames. Our transition to Bizarro World is complete.

If you haven’t been in a coma for the past year, of course, Nenshi’s statement will come as less of a shock, as he was a vocal supporter of the arena deal when it passed, for reasons that weren’t entirely clear even at the time. And they’re even less clear now that it’s been made apparent that most Calgary residents were opposed to the deal (or at least most of those who sent in comments to the council), and there are people literally marching on City Hall to oppose the possibility of a 250% price hike for low-income transit passes as part of the budget cuts. If Nenshi felt like he didn’t have the support to oppose the deal in July, he certainly has political cover to do so now; presumably either he’s agreed to some quid pro quo that is stopping him from calling for the deal to be renegotiated, or is more afraid of alienating developers than nice white-haired people marching on City Hall, or genuinely thinks that this deal is somehow much better than the previous one he rejected despite it not being anything close to the “public benefit for public money” that he had said was his bottom line for any deal.

Meanwhile, Farkas also raised the question of why, if there’s still no formal arena agreement in place, “this was so pressing that it had to go through in the middle of July with barely a week of consultation.” This really is an excellent — and rare — opportunity for a city to rethink a project that was rushed through without enough public debate; it doesn’t seem likely to happen, and maybe wouldn’t even with Nenshi’s support, but it’s still remarkable how quickly the political winds shifted on this one. Hey, Jay Scherer, do you have time to write another book?

The vaportecture artists just aren’t even trying anymore, man

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We’ve been over a lot of bad stadium renderings on this site — stadiums with two sports being played at once, stadiums with people walking on snow-covered ice rinks in street shoes, stadiums where fans stare at trees. But this latest from the Worcester Red Sox (previous home of the tree starer), just come on:

What… what is even happening here? At first glance, it looks like the WooSox are proposing a stadium where all of the seating is in the outfield, the better to protect fans from the horrific sight of 30-foot-tall toddlers rampaging across the infield. Or it’s possible that’s some kind of baseball-field-themed play park out in the outfield behind the scoreboard — this image suggests maybe that’s the case — but even so, the people walking on it are wildly out of scale, even with each other, and also there appears to be nothing stopping them from just tumbling onto the real field in the background. I’m also not sure what purpose those frosted-glass turnstiles are supposed to serve, or what happened to the feet (or eyes, nose, and mouth) of that poor woman in the foreground. It’s like someone was left in the rendering room with a bunch of Colorforms and no supervision, and then the results were sent directly to the press.

Then there’s this, which MassLive helpfully captioned “Polar Park will offer a berm seating location the left centerfield”:

From the other images, I’m guessing that’s supposed to be a grassy slope with the outfield wall at the bottom, a wall that’s made up of some kind of blue rocks topped with a divider from Atari Adventure.

Of course, it’s always possible that the MassLive caption editors are trolling us, when you consider that this image is captioned “The Summit Street Fair located in Polar Park will offer year-round and nightly activities for patrons visiting the area in Worcester”:

Look, we all know that renderers are overworked by clients with no particular interest in quality control, so I’m willing to cut them some slack here. But why on earth did MassLive choose to run all of these horrific images, under the uncritical (if possibly trolly, everything starts to look possibly sarcastic if you stare at it long enough) headline “New Polar Park details include a heart-shaped clock, smiley foul poles and year-round nightlife”? (Yes, I didn’t even get to the smiley-face-topped foul poles.) Is this the dystopian future we now live in, where everyone just sighs and does whatever the money people ask for, while hoping that readers will be smart enough to laugh instead of taking it seriously? Do they even care if people take it seriously, so long as the checks clear? I think we may finally have arrived at that Hobbesian grift of all against all that we’ve been waiting for, people.