Henrico County announces “smart economic partnership” for new Richmond arena that looks just like one city rejected as dumb last winter

When last we left the city of Richmond, Virginia, it was bailing on a plan to spend $300 million on a downtown arena after determining that doing so could have left the city raiding its schools budget and general fund if things went south. But never fear, the same developers are back with a new plan out in Henrico County that would cost even more money:

A group including Michael Hallmark and Susan Eastridge are planning a massive $2.3 billion arena-anchored development on the Henrico-owned 93-acre former Best Products site, according to an announcement made by the county this morning….

The $250 million multi-purpose arena would be comparable in size to what Hallmark and Eastridge had proposed as part of their involvement in the unsuccessful Navy Hill development which would have replaced the Richmond Coliseum. That project was killed by Richmond City Council in a heap of controversy earlier this year.

County Manager John Vithoulkis alluded to Navy Hill’s fate in explaining at today’s press conference how Henrico expects to handle things differently than the city.

“This is what we do in Henrico: Smart economic partnerships with no risk and significant benefit to the tax payer,” he said.

Yeah, about that “no risk” to the taxpayer, how would the Henrico County project be funded?

GreenCity would be financed in part through the creation of a community development authority, which would allow for the sale of private bonds that would be repaid with taxes produced by the development.

A community development authority is basically a tax-increment financing district, where tax payments from a development are kicked back to developers to pay down their construction debt. In other words, pretty much the exact same plan that was considered by the city and rejected, because TIFs way too often turn into money pits if the projected tax revenue doesn’t come in. (And even if it does come in, if siphoning off tax revenues turns your local budget into Swiss cheese.) This is what we do in Henrico: Copy off of other jurisdictions’ dumb ideas, then declare them to be smart, because we’re the ones doing them! Oh, and call it GreenCity, all the kids will like the sound of that.

UPDATE: A reader points me to the Henrico Citizen’s reporting on the county plan, which says the main difference from the city plan is that the tax kickbacks would be limited to taxes paid by the project itself, not any surrounding properties. Which is a nice idea in theory, but if those taxes were enough to pay off construction costs, then why would the city have needed to make the TIF district bigger? And there’s nothing stopping the county from making its district bigger if its money runs short. So while not exactly the same as the city’s plan, it’s awfully close, and Henrico really needs to come up with more details than “Different acronym! And the green thing!” to show that it would be any better for taxpayers.

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Minneapolis seeks state bailout on Vikings stadium debt so it can pay convention center debt instead

Let’s start with the simple part of this story:

Rep. Mohamud Noor, DFL-Minneapolis, said he will seek relief from the city’s first scheduled debt payment of $17 million [on U.S. Bank Stadium] — and then push for a longer-term discussion about restructuring the stadium’s debt to give relief to Minneapolis.

The city of Minneapolis owes $150 million toward construction costs on the Minnesota Vikings‘ stadium, with the state covering another $348 million and team owner Zygi Wilf another $600 million. (Though when you add in the team’s property-tax break and city money being spent on stadium operations, Wilf’s tab is really closer to $0.) The pandemic has trashed the city’s budget, especially the sales taxes it had set aside for stadium debt payments, so Noor is looking to the state to bail it out.

The reason why the city is looking for state help — other than that cities will always do that when they can — has to do with the insanely convoluted financing structure the two levels of government set up during the rush to approve funding for the Vikings’ stadium. The city put off paying down any stadium debt until 2021, because it was busy paying off debt on its convention center until then. The state, meanwhile, decided to fun its share with pulltab gambling revenues — which turned out initially to bring in no money at all instead of the $62.5 million that had been projected, forcing the state to raid its cigarette tax fund instead to pay down stadium debt. Then Minnesotans finally started getting hep to the pulltab gambling thing and money started flowing from that, which led to a small but growing surplus in the pulltab fund, which led Minneapolis officials to start salivating over how nice that money would look plugging their budget hole.

So far this is all just city and state governments bickering over who’ll cover how much of $1-billion-plus stadium tab now that money is tight. But then we get to the debt on Minneapolis’s convention center, which is another drag on the city’s budget:

Earlier this fall, Minneapolis City Hall decided to refinance the remaining $26 million convention center debt for up to five years…

City Coordinator Mark Ruff declined multiple interview requests but provided a written statement saying the city had seen an “unprecedented decrease” in sales tax revenues from the pandemic. City staff recommended delaying the convention center debt for greater “flexibility,” he said.

But Ruff warned that if sales tax revenues do not recover quickly, “revenues will need to be diverted from future capital improvements at the Convention Center to debt payments.”

Put it all together, and we have: If Minnesota doesn’t share some of its surplus money it ended up with after dumping more cash into the stadium project, then Minneapolis won’t be able to spend more money to upgrade its convention center. A convention center that nobody wants to go to during Covid, and probably no one will want to go to even after Covid because convention spending is in a long-term decline. This is maybe not the argument that I would want to go to the state capital with, but all’s fair in love and bailouts.

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Jacksonville mayor tells council to “stop stalling” and vote on $200m Jaguars subsidy

If you were still wondering if Jacksonville Jaguars owner Shad Khan is really asking for public funding for “major” stadium renovations at the same time as he’s demanding $200 million in subsidies for a new development in his stadium parking lot, we now have confirmation that yes, he really is:

[Jacksonville city council finance committee chair Matt] Carlucci said a vote on Lot J should only happen if the development is bundled with stadium improvements and an extension of the Jags’ lease at TIAA Bank Field, set to expire in 2030. He said if the Jags were to leave Jacksonville in the future, the city would still be on the hook for Lot J.

“The stadium, Lot J and a lease extension are all linked together, and if we don’t do that right, the taxpayers will never forgive us,” Carlucci said.

That’s an excellent point, in that giving Khan $200 million without even asking for a lease extension seems, I believe the technical city-planning term is “nutso.” Though giving him $200 million for the Lot J development plus maybe an equal amount for stadium renovations at the same time would be equally nutso, unless he agrees to a lease extension until the 32nd century.

Carlucci is also asking for more time to evaluate the deal(s), as the Lot J plan is currently scheduled to be voted on by the Downtown Investment Authority tomorrow, discussed by the council on Thursday, and then voted on as early as next week. Jacksonville Mayor Lenny Curry, who designed the deal, is having none of that “due diligence” balderdash:

Do you want to take your time to think about devoting hundreds of millions of public dollars to a private stadium development project, or do you want to be an NFL city? Don’t think too long, there are plenty of other cities who would love to … what’s that, which cities? I said to stop stalling!

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MLB redraws its minor-league map, including demoting team Wichita spent $75m to lure there

The fallout of MLB’s plan to jettison 42 minor-league affiliates to save money on paying players pittance wages is coming fast and furious, with big-league teams switching farm clubs while other teams scramble not to be left without a chair when the music stops:

  • The St. Paul Saints, founded in 1993 as one of baseball’s most successful independent-league teams, will now be converted into the Minnesota Twins‘ Triple-A farm team. The Sugar Land Skeeters previously announced they will likewise go from indie ball to affiliate ball, as the Triple-A team of the Houston Astros.
  • Since every MLB team has exactly one Triple-A affiliate, this means two teams will have to get demoted to Double-A, and those will apparently be the San Antonio Missions and the Wichita Wind Surge. The Wind Surge demotion is especially notable because the team never actually played a game at the Triple-A level (it is the former New Orleans Baby Cakes, relocated in 2020 right before the pandemic wiped out the minor-league season), and also because Wichita just allocated more than $75 million to a new stadium to lure a Triple-A team, and is now right back in the Double-A Texas League where it was until 2007.
  • MLB gave the owners of the Fresno Grizzlies and the city of Fresno until yesterday to accept demotion from Triple-A to Single-A, or else be left without an affiliated team at all. Following a behind-closed-doors council meeting yesterday, city attorney Doug Sloan released a statement saying MLB had agreed to give the city more time, but not how much more time. (MLB is supposedly set on releasing final team affiliations today or tomorrow.)
  • No, I don’t get where the additional Triple-A team would come from if Fresno were demoted, unless maybe this would give San Antonio or Wichita a reprieve? (UPDATE: The Jacksonville Jumbo Shrimp are reportedly in line to jump from Double-A to Triple-A, thanks, Facebook commenter!)
  • The entire Pioneer League is becoming an independent “partner league,” which according to the press release seems to involve MLB giving them some seed money (“initial funding for the league’s operating expenses”) plus “scouting technology” (uh, radar guns?) and then cutting them loose to sink or swim.
  • The Mahoning Valley Scrappers, State College Spikes, Trenton Thunder, West Virginia Black Bears, and Williamsport Crosscutters, all of which were set to lose their affiliated teams, will instead become part of a grab-bag MLB Draft League, which will also get that “state-of-the-art scouting technology,” plus “educational programming designed to prepare them for careers as professional athletes.” (Make your own jokes here.) Will the players get paid? Given that the league’s FAQ brags about how there’s no fee for players to play in it, almost certainly not! (Also, the FAQ warns that “players need to pay their way to get to the league at the start date,” so think on that before you submit your application to play shortstop.)

The offseason affiliate dance is a time-honored tradition by now, but this winter’s is something entirely different, and not just because of the contraction plan: MLB effectively took over the formerly independent Minor League Baseball organization in September, simply by refusing to negotiate a new operating agreement and demanding that MiLB hand over the keys. That means that instead of negotiating with individual MiLB teams as in the past, MLB can simply redraw the minor-league map and issue edicts: If you’re not happy being a Single-A team, Fresno, no more shopping around for a Triple-A affiliate on your own, because MLB has already decided that for you.

In other words, it’s extending MLB’s cartel power — or monopoly power, depending on whether you consider the league an association of competitors or one big company with 30 co-owners — to govern all of the minor leagues as well. And that’s a scary concept, and not just if you’re one of the people who bought gear with the hideous Wichita Wind Surge logo in anticipation of Triple-A ball. While MLB’s offer to Fresno right now is take-it-or-leave-it, there’s nothing stopping the league in the future from exacting stadium or lease concession demands from minor-league cities, or risk losing their teams to wherever MLB decides to move them. While hosting a minor-league team has always been dicey since they often have a relatively short lifespan, at least there was a silver lining in that if one MLB team abandoned you there were 29 others to shoot for; now, the minors are all a single-source negotiation, and that’s bad news for cities’ leverage.

The other benefit to MLB, of course, is that it is transitioning lots of minor-league players to playing for “exposure” instead of actual paychecks; in addition to the Draft League, the Appalachian League is becoming a summer league for college players, who also won’t be paid. This is such a common practice now in the work world that it has its own Twitter account for horror stories, but it hadn’t spread to pro sports until now — there’s a class action suit trying to force pro sports teams to pay their players at least minimum wage, but until then, it looks like baseball is determined to make lots of wannabe major leaguers start out their careers by doing season-long unpaid tryouts. Maybe teams like Trenton and Williamsport will at least allow players to trade autographs for sandwiches, that seems like a fair solution.

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Alberta paid NHL $4m during pandemic bubble to show pictures of Alberta wheat fields

If you’re an NHL fan, you’re possibly aware that much of this past abbreviated season’s Stanley Cup playoffs were held in a bubble in Edmonton. If you’re a diehard NHL fan, or just a diehard Canadian, you may even be aware that Edmonton is in Alberta, the province that is second in Canada in wheat production.

In fact, maybe you learned this by watching the NHL playoffs, because part of the deal to play games in Edmonton, it turns out, was a $4 million ad buy by the Alberta government to tell viewers that the province outside the arena walls is “free” and very wheaty:

Recently disclosed public documents show the Government of Alberta gave the NHL $4 million dollars in a sole-source contract between July 31, 2020 and October 1, 2020 in order to “promote investment in Alberta to provincial, national and international audiences through a unique partnership opportunity with the NHL.” But no public statement from Premier Jason Kenney or the Alberta government has made mention of the $4 million dollar payment…

What was purchased with that money is an important question and an inkling of what that money was spent on lies in a 30-second video message Kenney shared on Sept. 1, Alberta’s 115th birthday, ahead of the puck drop for the NHL playoff game between the Vancouver Canucks and the Vegas Golden Knights. The message was broadcast on the scoreboard at Rogers Place. Kenney touts Alberta’s low taxes, young population and “freest economy in Canada.” He closes by saying, “to hockey fans around the world, we hope you’ll follow the NHL’s lead and come to visit Alberta when you can.”

A short clip from an August 7 game between the Edmonton Oilers and the Chicago Blackhawks also gives a hint as to where that money was spent. In a break in the action prior to a puck drop, the camera shows several large screens in Rogers Place, on those screens are Indigenous people dancing, then it fades to a tight shot of several golden brown wheat heads against a blue sky. On another screen there is a static image of the Alberta watermark.

See for yourself:

Tourism agencies do these kind of ad buys all the time, of course, but promoting Alberta to an empty arena is a just slightly strange use of $4 million, even if the images did show up in the corner of TV screens on occasion. That doesn’t necessarily mean there was a quid pro quo here where the NHL demanded an ad buy as part of its decision to site games in Alberta, but it’s certainly a good question to ask; Progress Alberta, which first revealed the ad spending, has promised to follow up, and fans of both hockey and wheat should be very interested in their future findings.

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Toronto councillor says he’s sure Jays stadium plan is good, whatever it is

The Toronto Blue Jays stadium plan is still, as one columnist called it, “a trial balloon wrapped in a beta test,” with few real details beyond that it would require the demolition of SkyDome, cost “multibillion” dollars, and be “privately funded.” But that hasn’t stopped Toronto city councillor Joe Cressy from endorsing the plan sight unseen:

“The clear understanding from the earliest conversations was that [public funding] was not a consideration here,” Mr. Cressy said. “I don’t see it as an inherently politically contentious subject.”

The problem, of course, is that “no public stadium funding” is a claim that’s gone along with everything from a $350 million gift of public land to the most expensive baseball stadium subsidy of all time. And also that there can be reasons for a development deal to be contentious even if it doesn’t require public money. (Is what the Jays owners want really the best use of the stadium site?) It’s possible Cressy knows more than he’s letting on — the Jays stadium talks have apparently been going on in secret for years — but it’s also possible he’s just trying to spin the story as pay no attention to the financial details behind the curtain, in which case we definitely should be paying more attention to the financial details.

Meanwhile, even the hint of a new Blue Jays stadium has some people fantasizing about how great it would be if Toronto’s future ballpark could be modeled after another stadium that hasn’t actually been built yet:

That there is a Photoshop, all right! It also requires putting the new stadium on the site of the old stadium, which would defeat the purpose of moving it to the south to make way for new residential and office towers, but would be necessary to leave room for the retractable roof to retract, as can be seen in this Hokkaido rendering:

That’s an important question, though: Would a new Jays stadium have a roof? If so, it would be hard to have natural grass there, unless the roof fully retracts as in the above image, in which case there’s not much room on the site for a stadium plus additional buildings. (There’s a major highway not far south of the current stadium, which is the only direction it could expand in.) If not, it’s gonna be cold in April, which is the whole reason SkyDome was built as a dome. This could get contentious!

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Friday roundup: Raiders stadium runs short of tax dollars, Falcons owner makes film about how great Megatron’s Butthole is, and a Ricketts cries poor (again)

Well, that was certainly something to wake up to on a post-Thanksgiving Friday morning. Not sure how many U.S. readers are checking the internet today, but if that’s you and you’re looking for some non-Canadian stadium and arena news for your troubles, we have that too:

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Report: Toronto’s SkyDome marked for death, redevelopment using public land

Right, so three days ago in a comment thread about whether major stadium and arena construction is likely to slow down in coming years (because of Covid and shifting political winds), FoS reader Aqib wrote,

By my count there are 2 MLB teams (Oakland and Tampa) that are in the market for new stadiums

and I replied,

the Diamondbacks have already said they’re considering a new stadium, the Blue Jays and White Sox have at least been kicking tires, and teams like the Indians and Orioles have talked about significant renovations

and they replied,

Blue Jays? All I heard was that they were looking at refurbishing the stadium to make it a pure baseball park, but that was 5 years ago. Is there anything new?

and I replied,

Nothing lately — that was the tire-kicking I referred to. But you don’t put Chekhov’s gun on the mantel unless you’re going to use it eventually.

By “eventually” I didn’t actually mean “by the end of this week,” but here we are:

The owner of the Toronto Blue Jays wants to demolish the Rogers Centre and construct a new stadium as part of a downtown Toronto redevelopment, according to sources involved in the project…

Rogers Communications Inc. and the real estate arm of Brookfield Asset Management Inc. are working with city, provincial and federal government officials on a plan that would effectively cut the Rogers Centre in half.

The partners would build a new, baseball-focused stadium on the foundations of the southern end of the current facility and adjacent parking lots. The northern portion of the 12.7-acre site would be turned into residential towers, office buildings, stores and public space.

Rogers is also considering building a new stadium on a lakefront site if plans for the Rogers Centre fall through.

The Globe & Mail reports that the project would cost “multibillion” dollars, and would be “privately funded” (by Blue Jays owners Rogers Communications) and developers Brookfield, but “needs numerous government approvals to move forward.” It also would use federally owned land, which raises all sorts of questions about how much the team and developers would pay for this valuable property, and whether the development would pay property taxes (more common for private developments on public land in Canada than in the U.S., but still not a given), and generally sets up the potential for a Canadian version of Anaheim’s “We’re getting market value for our stadium land but also not really” scenario.

The report also says that lobbying records show the Jays and Toronto officials have been discussing this plan for two years, that rebuilding the stadium “is expected to play out over five to eight years,” and that “it is not clear where the team would play if its Toronto stadium is being torn down and rebuilt.”

SkyDome — now the Rogers Centre officially, but still once and always SkyDome — was opened 31 years ago (by Alan Thicke, for some reason), and as noted the Jays have made faint noises about leaving for a new stadium before, so this is slightly less shocking than when the Atlanta Braves owners announced they were leaving their then-17-year-old stadium to move to suburban Cobb County or the Texas Rangers owners announced they would be moving across the street from their only marginally older stadium to one that was the same only with air conditioning. But still pretty shocking! There are, as noted, still a whole lot of unknowns about this one, so I think we can say we’re going to spend much of 2021 discussing all its ramifications. And if we end up spending 2022 on the Chicago White Sox, don’t say I didn’t warn you.

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Blue Jackets bailout could go from bad to worse as team seeks more “glamorous” locker rooms

When I’m asked what I think is the worst sports subsidy deal in history, and I’m asked that a lot, my go-to response is that every unhappy stadium deal is unhappy in its own way. But when pressed to pick a few for the all-time Hall of Shame, I’ll occasionally find room for the Columbus Blue Jackets arena bailout, if only because it turned a model of private arena financing into a massive public subsidy just because the team owners whined that they weren’t making enough money. And then the city of Columbus agreed to give Nationwide Insurance, which put up the money for the original private arena construction, $62 million in added tax money when it turned out casino tax revenues weren’t going to cover the original deal.

If you see this headed toward “more good money thrown after bad,” you’re way ahead of me. Take it away, Columbus Dispatch:

Okay, so maybe the Dispatch got so excited it couldn’t remember how verbs work. The point is, as the paper discussed in an accompanying story with a more grammatical headline, the 20-year-old arena needs not just a new roof, but “$94.4 million in capital-improvement expenses over the next five years.”

The good news is that arena authority director Don Brown says the general public won’t pay for the upgrade costs, because it has a repair fund already set aside, funded by “casino tax and admissions tax proceeds.” The less good news is that these taxes would otherwise go into the general fund if they weren’t being siphoned off for the arena fund; the even less good news is that thanks to casino and admissions tax shortfalls in recent years, the repair fund currently just has $454,000 left in it, plus a $2.4 million reserve fund, which is a lot less than $94.4 million.

The Dispatch article goes on to say that the Blue Jackets and their partners in operating the arena — Nationwide and Ohio State University — will be on the hook for arena upgrade costs, but also that the team’s lease requires that the building be kept in “first class” condition, which seems likely to be a point of contention in any disputes over where to come up with $90 million. Among the items that the arena authority cited the hockey team as wanting to have improved:

The locker room for Blue Jackets players is “reasonably well-appointed but is not as glamorous as NHL home locker rooms in newer facilities,” and could use a “thorough” upgrade. The player lounge and training areas are well-maintained “but not impressive,” and the players’ family lounge “does not present an NHL-level image.”

Well, we certainly can’t have that! What will the neighbors say?

There’s a lot of confusing language in the arena operating arrangement — the public arena authority is part of the management group, but isn’t responsible for upgrade cash unless OSU backs out — but given that we’ve already seen Columbus bail out the private parties for no good reason other than that they asked for it, it’s hard to rule out anything. The main takeaway here is that the Blue Jackets are publicly seeking $94 million to replace their roof and bling up their locker rooms, which is always a sign that taxpayers should hold onto their wallets.

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Jaguars owner demands “major” stadium renovations, or NFL will shoot this team

Remember just last week when we discussed the $200 million-ish that Jacksonville Jaguars owner Shad Khan wants to subsidize a giant development in his stadium’s parking lot? At the time it seemed like a perfect example of the new wave of sports subsidy demands: If you can’t get public cash for a new or renovated stadium, then ask for a sweet deal on some related project, since that’s easier to fudge the numbers on.

Until Monday, that is, when Jaguars president Mark Lamping told the Florida Times-Union that oh yeah, Khan wants a renovated stadium, too, or else:

“If you’re going to be making a long-term extension of a lease, there needs to be certainty that you’re going to have an NFL-quality stadium during the term of that extension,” Lamping said. “That’s obvious, no different than when the Jaguars came to Jacksonville.”

Lamping elaborated on this yesterday:

“If Shad [Khan] were to ask fellow NFL owners and the league to approve a lease extension right now, there are really two questions that are unanswered that need to be answered before you even consider that,” Lamping said.

Lamping said 75% of NFL owners have to vote “yes” to any lease extension. One of those outstanding items, Lamping said, would be asking: “Does the stadium meet the needs of NFL fans and other stakeholders?”

These statements move the goalposts in a bunch of ways at once: They declare that TIAA Bank Field, which was opened in 1994, is no longer “NFL-quality”; that without renovations, the Jaguars won’t sign a long-term lease; and that if they don’t, it’s not because Khan doesn’t want to, heaven forfend, it’s those nasty old NFL owners that won’t let him stay in a substandard stadium. And, of course, that the team could leave town without stadium upgrades — Lamping said he wanted to make sure “that there will be NFL football in Northeast Florida for generations to come,” proving that he’s well-versed in the Army Protection Racket sketch.

How much money Khan is looking for as part of a lease extension isn’t clear. He just got $45 million from the city of Jacksonville for stadium upgrades in 2015, and Lamping said what’s now needed is a “major stadium renovation,” so presumably it would require a lot more money than that. Jacksonville Mayor Lenny Curry has already responded that he’s willing to talk:

That could be just boilerplate of course we’re willing to sit down and talk, but it’s still a slightly alarming response to the local billionaire doubling down on his under-consideration $200 million subsidy demand by asking for maybe a couple hundred million more, or else he’ll leave town. Sorry, or else the other NFL owners will forcibly remove him and his team, maybe to London? Did Lamping neglect to mention London? Oh well, there’s always next week.

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