Friday roundup: Coyotes late with arena rent, Winnipeg move non-threats, and good old gondolas, nothing beats gondolas!

If you missed me — and a whole lot of other people you’ve likely read about here, including economist Victor Matheson and former Anaheim mayor Tom Tait — breaking down the Los Angeles Angels stadium deal in an enormous Zoom panel last night, you can still check it out on the Voice of OC’s Facebook page. I didn’t bother to carefully curate the books on the shelves behind me, as one does, so have fun checking out which novels I read 20 years ago!

And on to the news, which remains unrelentingly newsy:

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Pawtucket developer slashes size of soccer stadium project, still wants same $70m in tax subsidies

The Covid economy has developers all over rethinking construction plans, especially office projects, since it seems pretty likely not nearly as many people will be going in to the office in our future. And so it goes with Fortuitous Partners’ soccer stadium project for a USL team in Pawtucket, which was going to involve $360 million in apartments, shops, offices, and a hotel and conference center to go along with the $40 million stadium, and which now will include something less than that:

Brett Johnson, one of the cofounders of Fortuitous told the Pawtucket City Council on Wednesday night that the project was being scaled back. The former Apex site — the centerpiece of the project due to its highway visibility — is now being eliminated.

Johnson, who is also owner of the Phoenix Rising USL team, told the Providence Journal that his new price tag was “likely in the ‘low $300 million’ range.” The pandemic, he explained, has reduced demand for office space, though he could still add more offices later if those become a thing again.

But at least if the project is slimmed down, it won’t need so much in public tax subsidies, right? Hahahahahaha, no:

The project is still looking for $70 to $90 million in public financing. The company has hired high-powered Rhode Island lobbyists to try and secure the funding.

Or as the Journal says, in a sentence that manages to contradict itself in a single clause:

Johnson said Fortuitous still intends to privately finance the project using Opportunity Zone investments aided by tax increment financing with the city and state.

Kicking back $70-million-plus in tax revenues to get a $40 million minor-league soccer stadium (and a pile of other stuff) never seemed like the best idea, but it’s singularly worrisome at a time when minor-league sports is reeling and may never fully recover. Here’s Holy Cross economist Victor Matheson back in April on Pawtucket’s USL plans:

“This is a league with 100 teams and different tiers. Minor league sports are above everything the sort of thing to get crushed by coronavirus — everything they do is about getting people into the stadium. That’s not going to be happening with this team,” said Matheson.

“And this isn’t Lucchino — this isn’t John Henry, or Bob Kraft. These are often shoestring operations. [Coronavirus] could bankrupt a reasonably large number of teams in that league and suddenly this isn’t the league it was before,” added Matheson.

The tax increment financing plan still needs to be approved — I think by the state legislature, though it already approved a Pawtucket TIF district, so maybe just the city or the governor needs to okay it, really the reporting on this has been terrible — so there’s still time for things like public hearings, if anyone believed in those anymore. Maybe I’ll see if I can ask Matheson about it when he and I join up as part of this big Zoom get-together on the Los Angeles Angels stadium deal tonight at 9:30 Eastern/6:30 Pacific. I’m told it’s going to be broadcast live on the Voice of OC’s Facebook page, so check that out if you’re interested — I anticipate being very active in the comments…

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Worcester neglected to sign lease with WooSox before building them a $132m stadium, this will be fine, surely

Whut:

More than two years after Worcester city officials announced the Pawtucket Red Sox were moving to the Canal District, there is no formal lease agreement legally obligating the team to come to Worcester.

And about six months before the minor league baseball team is scheduled to begin play in a new $132-million public stadium, the city government still doesn’t own the property on which its ballpark sits, even as construction on the project is well underway.

As the Worcester Business Journal notes, these are important omissions not so much because the Triple-A Red Sox really might back out of their move — they’re getting more money in subsidies than it was initially budgeted to build their stadium, why would they turn that down? — than because this gives the team huge leverage in negotiating lease terms, not to mention the stadium land’s private owners huge leverage in negotiating sale and development terms.

The biggest immediate issue, as the Worcester Business Journal points out, is cost overruns: The initial $90 million price tag for the stadium hit $132 million in January, and could yet surpass the $150 million Las Vegas Aviators stadium for priciest minor-league ballpark ever. The city covered the initial round of cost overruns — partly through direct cash, partly through money that the WooSox are putting up and then getting repaid via future ticket tax money that otherwise would have gone to the city — and are going to be hard-pressed to get the team owners to cover any future rounds, what with their ability to say, “Gee, I dunno, there are plenty of other cities we could still move to…”

“What’s unfortunate about this is this should have all been worked out up front,” Marquette sports law professor Martin Greenberg understated to the WBJ. “This is not usual.” City officials getting their heads handed to them in lease negotiations is sadly all too usual, but forgetting to actually sign the deal before building the stadium, that’s breaking new ground, yeah.

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African-American community groups back Sixers arena plan because jobs, this is all going according to plan, muahahaha

When Philadelphia 76ers owner Josh Harris announced plans last week to build a $1 billion waterfront arena project at Penn’s Landing and pay for it with kicked-back sales, payroll, and other taxes from the surrounding neighborhood, and it was lauded as a way to create jobs, one of my first thoughts was If Harris is smart, he’ll do like Bruce Ratner did in Brooklyn and get community groups on board to say how desperately needed his development is, even if he needs to create his own community groups to do so.

Turns out, Harris didn’t need to create grassroots groups out of whole cloth:

A proposed new arena for the 76ers is earning the support of some important African American organizations in the region. The Urban League of Philadelphia, the Urban Affairs Coalition, the Black Clergy of Philadelphia and the African-American Chamber of Commerce all support the idea.

They say a new arena to be built at Penn’s Landing would bring unprecedented economic opportunity for Black and brown communities.

WHYY didn’t include any quotes from any of these groups, so it’s hard to say why they’re backing the arena deal or how strong their support is or if any of them are concerned that maybe those hundreds of millions of dollars that would be siphoned off via tax kickbacks might be more useful to Philadelphia’s 13.8%-unemployed-even-before-Covid African-American residents than a promise of a few construction jobs that may or may not come through. WHYY does note that the only other time the “Neighborhood Improvement Zone” subsidy program was used, for a Lehigh Valley Phantoms minor-league hockey arena and other development in Allentown, it left “lingering questions”:

A Neighborhood Improvement Zone resembles tax-increment financing, an arrangement in which money lent for development or other improvements to a certain area is paid down through the later realization of increased property tax revenues linked to those projects. The Allentown NIZ instead utilized a battery of potential tax revenue increases – payroll, sales, alcohol, or others – to pay down both government bonds and developers’ private loans linked to the redevelopment of a 128-acre downtown zone. That area was adjacent to a working-class neighborhood that had been growing organically largely due to an influx of Latino immigrants and businesses…

Chris Woods, a Ph.D. candidate at Brown University who studied the Allentown NIZ, found that, after paying down financing costs, the zone often returned less revenue to governments than before the development took place. And, in 2018, more than half the tax revenue raised by the development went back to the developers, according to the Morning Call. 

There are still a lot of steps that need to happen before the Sixers arena can become reality: The Delaware River Waterfront Corporation has to pick Harris’s as the winning proposal for the site, then the NIZ — which is really a super-TIF — would have to be approved by the state, then there could be a city vote as well. But you only get one chance to make a first impression, and Harris is certainly doing his darnedest to make this about JOBS!!!1! and not about taking a large slice of public tax revenue and giving it to a billionaire private equity baron. Well played, sir, well played.

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Friday roundup: Stadium news reporting hits rock bottom, don’t believe anything you read (except on this site, duh)

Hey look, it’s Friday again! The St. Louis Cardinals are maybe (assuming no positive test results today) going to start playing games again tomorrow for the first time in 17 days; if they pull it off, and no other teams have outbreaks in the meantime, it will be the first time in nearly three weeks that all 30 baseball teams will be in action, and every team in the four major U.S. sports that are in action. That’s way better than I expected, frankly, and shows that isolating players from the general public (and each other) can work — there’s probably a decent chance that most leagues can limp to a conclusion without shutting down entirely, though football remains an enormous question mark with such huge rosters and no bubbles. Still, glass half full, that’s what I always say! (Okay, I never say it, but I’ll say it now.)

In other newses:

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Santa Cruz considering replacing eight-year-old arena with new one to “woo” minor-league basketball team

Move over, Knoxville — Santa Cruz is ready to take the lead in the “looking to build a new sports venue despite the Covid budget crunch” race. The Santa Cruz Warriors G-League team’s lease expires after next year, and the city is reportedly looking to “woo” the team into staying put beyond that, according to the Santa Cruz Sentinel. And what, precisely, do they mean by woo?

A city-sponsored market and arena project feasibility study by consultant Victus Advisors concluded in 2017 with support to build a permanent arena in an expanded footprint on the existing location, top among several preferred locations. [Santa Cruz economic director Bonnie, I’m assuming, the Sentinel article didn’t actually bother to give her first name or ID] Lipscomb said Tuesday that she recognized that right now was, “from a fiscal standpoint in the middle of a pandemic, the worst time to come forward asking for a public subsidy.” Lipscomb clarified she was not asking city leaders for that this week. City Manager Martín Bernal later further elaborated that building a new arena would be a public-private effort, not a “100% or primarily a public type of project.”

So nobody is asking for any kind of public subsidy, just a “public-private” effort that wouldn’t be “primarily” public. Got it.

As for the outmoded arena in need of replacement, it was opened way back in … I’m sorry, did you say 2012?

Okay, so technically this is classified as a temporary building: It’s a metal frame with an air-supported roof. (The city loaned the Warriors $4.1 million to help build the place, most of which has been paid back, according to Lipscomb.) Still, air-supported roofs have been used for plenty of permanent structures in the past, and nothing seems to be falling apart at the current arena. The Warriors owners — who are, let’s be clear, the same billionaires who own the Golden State Warriors) may want a snazzier place, but that wouldn’t seem to be Santa Cruz’s problem.

Except, of course, for that expiring lease, which gives the team owners that all-important leverage. Along with the fact that basketball is unusual among North American sports in having only a single 29-team minor league when there are hundreds of cities that could potentially support a minor-league basketball team — while Joe Lacob and Peter Guber would have been insane to move the Golden State Warriors out of the Bay Area, their G-League affiliate could probably do just fine in Fresno or Sacramento or Vacaville, which makes it way easier to get a bidding war going, or at least threaten your city with the possibility of a bidding war, which as we’ve seen time and time again is a great way to get local development officials talking about “public-private partnerships.”

And all this makes me wonder whether, even if the Covid recession causes a brief lull in sports subsidies, we could see a huge surge once it’s over, if not before then. We already have the likelihood of a large swath of minor-league baseball teams getting disappeared next year; and still more minor-league teams across several sports may go belly-up if they run out of cash while waiting for fans to return. And while that may be terrible for the sports industry as a whole, for the teams that survive, it hands them a convenient gun to hold to the heads of their current homes: With plenty of other empty stadiums out there to choose from, give us what we’re asking for, or else.

That’s going to be a tough call for city officials: Dip into recession-ravaged budgets to give money to the local sports team, or risk losing one of your few local businesses. (I almost wrote “major businesses,” but that’d be pushing it for a business that’s only open at most 70 days a year — though there is some evidence, at least, that minor-league teams are better at siphoning off spending from the next town over than their big-league counterparts.) Again, we’ve seen which way most cities tend to go on that decision, so it’d be crazy for minor-league sports owners not to at least try.

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Tennessee Smokies owner looking for “public-private partnership” to build new stadium in Knoxville, here we go

All this talk of Covid infection control protocols is fun to pass the time, but I know you’re all wondering: When are some rich dudes going to resume the real national pastime of grubbing for taxpayer dollars to build sports stadiums? And today you shall wait no longer, because Randy Boyd, multimillionaire invisible dog fence baron, failed gubernatorial candidate, University of Tennessee president, and Tennessee Smokies owner, has asked the city of Knoxville to build him a new stadium. The basics:

  • The Smokies currently play in Kodak, about 15 miles east of Knoxville, having moved there from the city when a new stadium was built for them by Sevier County in 2000.
  • Their lease expires in March 2025, but Boyd can leave early if he buys out the remaining years, which would cost him either around $10 million or $300,000 a year, depending on which news source you believe.
  • Boyd spent $6 million in 2016 to buy seven acres of land in Knoxville that he hopes to use for a stadium.
  • Knoxville Chief Economic and Community Development Officer Stephanie Welch says the city is exploring funding options, and is “excited about exploring the opportunity with other partners” and seeking a “public-private partnership”; this translates as “Boyd doesn’t wanna pay for all of it, so we’re trying to find some local business suckers to split the cost with the city.” There’s also talk of a “mixed-use development” on the site, which would be a lot to fit on Boyd’s 11 total acres along with a ballpark, but is definitely the kind of thing you say when you’re looking for ways to involve other investors.
  • Are there renderings? Do they involve ballplayers the size of Volkswagens standing in positions bearing little resemblance to actual baseball? You bet they do:

This is all just the kicking-the-tires stage, but it’s certainly worth noting that Knoxville officials seem perfectly eager to throw some kind of public money at a new stadium even in the midst of a pandemic recession that has forced budget cuts to such things as libraries and public health. And that’s before Boyd has even rattled any sabers about moving out of the Knoxville area entirely — don’t forget that once minor-league baseball restarts, it will likely be without 42 affiliated teams including the Chattanooga Lookouts, any one of whose cities could be interested (or at least cast as interested) in becoming the new home of the Smokies. I know it may seem like the world has changed irrevocably under Covid, but the underlying business model of the sports industry and its relationship to local political forces is still there, waiting patiently for this to all be over. Or not so patiently, if there’s an expiring lease and an unemployed sketch artist with no sense of proportion ready and waiting to go.

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With college football season on the brink, what can we learn from sports leagues that have restarted play?

College football’s Mountain West conference canceled its fall season yesterday, with the possibility of holding it next spring instead, and the “Power Five” conferences (Atlantic Coast Conference, Big 12, the Big Ten, Pac-12, and Southeastern) are reportedly set to meet today to discuss doing the same. This has led to a flurry of reactions from across the sports and political world as to whether it’s a good idea to play contact sports during a raging pandemic (players: yes, if there are safety protocols; doctors: maybe no if you don’t want players to risk lasting heart problems; Donald Trump: blarrrrrrgh!), with lots more tweets surely to follow.

This makes it a good time to take a step back and see what we’ve learned so far from sports leagues that have restarted since Covid took hold this spring, and what it can tell us about how to proceed from here. Unfurl the data points:

That is, honestly, not a terrible track record overall — back in the spring, it wasn’t clear that any sports leagues would be able to finish out their seasons, so a range from successful restarts to “limping along but might make it to the finish line” is better than expected. And there are definitely some lessons that we can learn from the spread of results:

  • If you want to play sports without an outbreak of virus, start with less virus. I mean, duh: The best way not to get infected is not to be around people who are infected, and in places like Taiwan, players could pretty much be sharing forks without much worry about contracting Covid. Likewise, even if NHL players busted out of their Canadian bubbles and hit the casinos (which are open), the level of community spread there is low enough that they’d stand a good chance of rolling the (metaphorical, virus-related) dice and coming away lucky.
  • Bubbles work. There was tons of skepticism that the NBA could pull off its bubble in the middle of the world’s biggest Covid hot spot without tons of infections, but so far it’s working well. Of course, we’re not even two weeks into the resumption of the season, and the entire two-month playoffs are still to go, so it remains to be seen if the league can keep its protective wrapping intact through October, especially as players start going stir-crazy. (Though player families will be allowed to enter the bubble at the end of the first round on August 30, after they’ve quarantined for two weeks.)
  • Testing works, sort of. The Marlins and Cardinals outbreaks have gotten lots of attention as a sign that MLB didn’t really have a plan for its bubble-less season — and, indeed, there are lots of signs that it didn’t, especially when the decision on whether the Marlins would play after positive tests at one point came down to texting their shortstop to see what he thought. And the uncertainty on when it was safe for teams to resume play has exposed all kinds of issues with how to interpret test results, thanks to everything from false positives and false negatives to the problem that it can take a few days for someone to test positive even after contracting the virus. But on another level, it’s a success: MLB has been aggressively testing its players — to the point where there are concerns that athletes are soaking up testing capacity and causing delays in test results for civilians — and managed to keep any outbreaks from spreading beyond those two teams. That may be the best you can hope for in a non-bubble league.
  • Actually playing sports doesn’t seem to be a huge risk. Unless I’ve missed something, there remain zero cases of athletes catching the coronavirus from opponents during games, even in higher-contact sports like soccer. (Early speculation that the Marlins got infected from the Atlanta Braves‘ catchers appears to have been incorrect — the Braves players never tested positive, though they did have Covid-like symptoms — and it’s more likely someone picked it up by going out for coffee or drinking at the hotel bar.) That actually jibes well with research that shows that “Successful Infection = Exposure to Virus x Time“; it’s simply hard to get infected if you’re only in close proximity to another player for a couple of minutes at a time. What’s super-dangerous is being in a clubhouse (or hotel bar) with teammates for extended periods, as witness how both the Marlins and Cardinals outbreaks spread like wildfire through those teams, even taking out the Philadelphia Phillies‘ visiting clubhouse attendant who shared indoor breathing space with the infected Marlins.
  • Indoor sports, and those with more contact, are less charted territory: The only good examples we have so far for indoor sports transmission are the NBA and NHL, which have barely begun play, and which are taking place in virus-free bubbles, so we haven’t seen how an outbreak would play out there. Likewise, nobody’s played any American football since the pandemic began; Australian Rules Football teams have been forced to bubble in hotels and move games to less virus-y parts of Australia, but don’t seem to have suffered major outbreaks among players, at least.
  • Getting Covid can be really, really serious, even for young, healthy athletes. As noted above, one of the concerns pushing college football to consider postponements is that doctors are noting an increase in myocarditis — basically, inflamed heart muscle — among college athletes, something that could be a passing thing, or could be a chronic problem. Boston Red Sox pitcher Eduardo Rodriguez has already been ruled out for the entire 2020 season thanks to Covid-related heart problems, and while team execs say they’re “very optimistic” he’ll make a full recovery, with a disease that’s only existed in humans for less than a year, they’re really only just guessing.

That’s still very much a work in progress, and lots more questions remain unanswered, including what on earth MLB should do if one of its teams suffers a Marlins- or Cardinals-style outbreak in the middle of the playoffs. Baseball officials are reportedly considering setting up bubbles for its postseason, though they’d still have to figure out how to have teams and their traveling parties quarantine first for two weeks; also, right now the only advantage teams finishing with better regular-season records would get in the expanded playoffs would be home-field advantage, which wouldn’t mean much if no teams were playing at home. As for college football, it’s hard to say what the risks are until someone starts playing and we see how many people turn up sick, though the indicators for a sport with tons of teams and huge rosters and no bubbles sure don’t seem too promising.

Still, there are some lessons here, and they’re reasonably hopeful ones: If you can manage to play in a nation with low virus levels, or keep your players and staff from ever interacting with the outside world, you can play sports, and maybe even allow fans in, relatively safely — though “relatively” is obviously less reassuring if you wind up being one of the few players getting sick. Really, the most important message here is the same one as for the rest of our pandemic world: If you want to reopen things that are important to you, keep wearing masks and stay away from house parties. The best way not to contract Covid remains having fewer infectious people to catch it from, so if it means shutting down restaurants and bars to keep schools open — or shutting down college football to allow other activities to proceed, or even shutting down everything until viral levels are down to near-zero — that’s the kind of calculus we need to be making right now. It worked for New Zealand!

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Friday roundup: What if a stadium tax break fell in the forest and there were no journalists around to hear?

Sorry if the posts were a bit light this week, but, one, it’s August (checks — yep, August, holy crap) and local governments are mostly out of session so it’s usually a slow month for stadium news even during what we used to call normal times, and two, I’ve been spending some time working on an FoS-related project that hopefully you will all enjoy the benefits of down the road a bit. (I also took a brief break to write about how Melbourne, Australia has declared a “state of disaster” and imposed strict new lockdown measures for virus rates that in the U.S. wouldn’t even get states to ban house parties.) If you were really missing me chiming in on the latest in baseball not shutting down just yet and instead adding a billion doubleheaders, maybe I’ll get around to a longer post on it next week.

For now, a quick tour through some of the news items that didn’t make the full-item cut this week:

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Friday roundup: Deadspin est mort, vive Deadspin (also baseball may be dead again, film at 11)

This was another shitty week in what feels like an endless series of shitty weeks, but with one undeniable bright spot: On Tuesday, the former staffers of Deadspin announced the launch of Defector, a new site that will be everything the old Deadspin was — sports and news reporting and commentary “without access, without favor, without discretion” — but this time funded by subscriptions and staff-owned, so safe from the threat of new private-equity owners decreeing that they stop doing everything that made the site both popular and worthwhile. I’ve already explained why I thought Deadspin desperately mattered for anyone who cares about sports’ role in our greater lives, or just likes great writing that makes you both laugh and think; you can read here my own contributions to the old site before its implosion (not sure why the article search function is listing every article as written by Barry Petchesky, who knows what the private-equity people are up to). Needless to say, launching a DIY journalism site in the middle of the collapse of the entire journalism business model is an inherently risky prospect, so if you want to give the Defector team a bit more of a financial foundation to work from, you can subscribe now. I already have.

But enough good news, let’s get on with the parade of sadness and horror:

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