Vikings near goal of selling $125m in PSLs, other NFL teams think that’s just adorable

The owners of the Minnesota Vikings have announced they’re 90% of the way toward selling out their stadium-builder licenses (i.e., PSLs) for their new stadium, having raised $115 million toward their $125 million goal as part of funding for their $1 billion stadium.

That’s good for them, but it points up how crazily unbalanced the PSL market is, with the Dallas Cowboys raising about $650 million, the San Francisco 49ers, New York Giants, and New York Jets a bit over $300 million apiece, and teams like the Vikings and Atlanta Falcons down in the $100 million range. That sort of explains why NFL teams are willing to pay $550 million to go to Los Angeles for its supposed PSL riches, though not really, since unless the Rams suddenly become as popular as the Cowboys they’re still only looking at maybe $250 million of added PSL sales, which according to my math is less than $550 million.

The other interesting bit is that, as has been the case with other PSL deals, the Vikings sold out the best seats and the cheapest ones first, and it’s the mid-priced ones that are the toughest sells. That could be a commentary on our increasingly economically polarized society, though it could also just mean that NFL teams are lousy at setting prices. Either way, if you have $2,000 burning a hole in your pocket and a desire to spend it on the right to buy football tickets (which will cost extra money to actually buy, of course), then Minnesota has a deal for you.

Billionaire wants $780m in tax money to build an NFL stadium for him in Las Vegas

We now have a hint of how Sheldon Adelson’s “public-private partnership” for a Las Vegas football stadium would work, and it’d probably be better called a “public-public-private partnership,” or maybe a “public-private partnership”:

A domed stadium proposed for the University of Nevada, Las Vegas football team has a price tag of $1.2 billion, and developers would seek $780 million in public financing, according to a document provided by Las Vegas Sands Corp., which is leading a consortium behind the project.

Private investors would contribute $420 million toward the planned 65,000-seat stadium, with various tourist-driven tax sources — commercial conveyance on taxicabs, rental car taxes or hotel room taxes — providing the bulk of the funding.

This is more or less the same funding scheme put forward by UNLV two years ago, except that the stadium price tag has gone up by $300 million since then, so the subsidy demand has as well. Putting in $780 million in tax money would be a stupendous amount of public cash — depending on how you count and whether the stadium would also get property tax breaks (probably), it could end up the most expensive public subsidy ever for a football stadium.

Of course, Adelson’s casino company also provided numbers to justify how this would be a great thing for Clark County to spend money on, telling the newspaper that Adelson owns that “the domed stadium would provide $600 million to $800 million in total annual economic benefit,” which is even more than consultant Convention, Sports and Leisure estimated two years ago.

But, you know, inflation or something. Or maybe just the fact that an extra $300 million in cost means you need an extra $300 million in economic benefit to make it still look good, But surely a consultant owned by the Dallas Cowboys and New York Yankees would never reverse-engineer figures like that, right?

 

Adelson wants $1b Vegas stadium funded by “public-private partnership,” possibly to lure Raiders

The University of Nevada Las Vegas’s plans to put off further discussion of a new campus football stadium until 2017 just got upended yesterday, as Sands casino company owner Sheldon Adelson announced that he wants in on building a $1 billion domed stadium for UNLV — and plans to meet with Oakland Raiders owner Mark Davis about possibly having his team play there.

Adelson should be familiar to anyone with an interest in national politics or the journalism industry: He’s a major Republican campaign donor who has had all the GOP presidential candidates competing for his sweet, sweet cash endorsement, and recently bought the Las Vegas Review-Journal while hiding behind a Connecticut newspaper publisher who curried favor with his new boss by writing positive articles about him under a pseudonymous byline.

It may or may not be connected, but the Review-Journal’s story on Adelson’s proposed stadium contains some of the more hilariously credulous statements about a stadium proposal that have been seen in these parts in some time. Let’s begin:

Andy Abboud, Las Vegas Sands’ senior vice president of government relations and community development, said Thursday that Las Vegas needs a modern stadium with at least 65,000 seats to drive additional tourism to Southern Nevada…

“We are moving forward with the stadium concept with or without an NFL team,” Abboud said Thursday. “We see a lot more opportunities — conference championships, bowl games, NFL exhibition football, boxing, soccer, neutral site games, and music festivals. There is an entire segment out there.”…

Abboud said the project would be a “public-private partnership” in which Las Vegas Sands or the Adelson family would contribute an unspecified large portion of the financing.

Okay, sure, it’s Abboud saying all those things, not the R-J. But still, letting stand unchallenged the notions that 1) Las Vegas — Las Vegas — is missing out of tourists because it doesn’t have a 65,000-seat football stadium, 2) stuff like boxing and music festivals is going to represent a significant amount of income for a domed football stadium, and 3) an amount of money can be simultaneously “large” and “unspecified” is pretty dismal journalism. You couldn’t even pick up the phone and call one person not involved in the deal to see whether any of these claims are remotely realistic? Maybe we should check that byline again…

Study finds higher home values cause NFL stadiums to spontaneously appear

Correlation does not imply causation” is one of the basic principles of statistics and logic — basically, just because your alarm goes off every morning right before sunrise doesn’t mean the sun is controlled by your alarm clock. Yet journalists and (especially) people putting together reports to promote their businesses forget it time after time after time.

In unrelated news, this:

Trulia_AllNFLStadiums_Graphic2Feel free to explicate on your own conclusions from this, but I’m going with “don’t go to a real estate listings site for your sports stadium economic analysis.” Or for proper use of commas.

California city terminates minor-league team’s lease on grounds giving away money is illegal

Back when they were filing lawsuits against the Phoenix Coyotes‘ arena deal every week or so, the libertarian Goldwater Institute at one point suggested it might challenge the team’s sweetheart lease as a violation of the state constitution because it represented represented an unlawful gift to a private enterprise. Goldwater never went ahead with that particular suit, but now the city of Adelanto, California is trying a similar tack to rework its lease with the minor-league High Desert Mavericks baseball team:

The Adelanto City Council on Wednesday night voted unanimously to terminate its stadium agreement with the ownership of the High Desert Mavericks…

The city says the public facility use agreement struck in 2012 violates the state Constitution and is essentially a “gift of public funds” in that the majority benefit is skewed toward the minor league baseball team. City officials say Adelanto has spent $2 million on maintenance obligations since August 2012 and yet Mavericks ownership Main Street Baseball, LLC pays $1 annually to lease use of Stater Bros. Stadium.

The Mavericks owners fired back with an “Oh, no, you don’t!” open letter, followed by a request to go to arbitration. They also insisted that the $1-a-year lease serves a public purpose because the lease says it does, so there. (Not quite in that language, but pretty close.)

Apparently a bunch of states have these kinds of gift clauses in their constitutions, and they’re almost always ignored, because not ever giving public funds to private entities for no public purpose would be un-American. This is the first time I can recall an actual elected body trying to void a lease on these grounds, so I guess I’m going to have to add the Victorville Daily Press to my reading list to keep up with how this fight goes.

Five out of five economists agree: Letting Rams, Chargers leave is a fiscal win for cities

SI.com asked a bunch of economists whether St. Louis and San Diego should have coughed up more money to keep the Rams and (potentially) Chargers from moving to Los Angeles, and if you read this site with any regularity, you can probably guess what they said:

Brad Humphreys, sports economist and professor at the University of West Virginia: There is no evidence in any peer-reviewed scholarly journal that a professional football team will generate any tangible positive economic impact on a city. There is no evidence that the departure of a football team ever harmed a city’s economy.

[Peter] Von Allmen[, president of the North American Association of Sports Economists]: There is a substantial body of economic research indicating that funding stadiums is not a successful economic development strategy.

[Victor] Matheson[, sports economist and professor at College of the Holy Cross]: I would advise them to let the teams go. I don’t think these teams are worth that amount of money. We don’t spend that sort of money on anything else. Way more people go to movies every year than go to NFL games, yet we don’t have the government build movie theaters.

All of the economists noted that if you want to go ahead and build a stadium just because you think sports are keen and not in search of elusive economic benefits, go right ahead. Which is where I kind of wish SI had reached out to Centre College economist Bruce Johnson, who conducted surveys to determine how much monetary value residents typically put on the joy they get from the presence of a pro sports franchise, and came up with a number under $40 million — which, needless to say, is typically way less than cities are spending on most new sports facilities.

Still, good article to take note of for the next time you need evidence that economists do occasionally agree on something. Elected officials not so much, but hey, maybe some of them read SI.

DC United release new stadium renderings, hope no one remembers old stadium renderings

If it’s Wednesday, it must be time for vaportecture porn! Today, the latest renderings of the planned D.C. United stadium:

dcunited.imrs.phpOkay, nothing too fancy, and that triple-deck stand on one side is kind of weird (it’s a single-decker on the other side), but it looks like a pretty standard second-division soccer stadium, which is about right for MLS. But say, didn’t they release renderings of this once before?

I’m not actually bothered that much by the design change, but yeah, don’t believe the pretty pictures, people. The stadium isn’t set to open until 2018 and the seating capacity isn’t even decided on yet, so I wouldn’t get too attached to the new renderings, either.

 

Consultant that’s never been right about anything tells Knoxville to build $200m minor-league hockey arena

As I frequently point out, I don’t have the bandwidth to cover all of minor-league sports, but occasionally a venue deal there stands out as especially noteworthy. And that’s the case with the proposal to replace the Knoxville Civic Coliseum, home of the Knoxville Ice Bears, with a new 10,000-seat arena for a whopping $205 million.

The price tag is alarming — I’m almost certain this would be the most expensive minor-league hockey arena ever, and it’s not close — but even more so is the consultant who made the proposal:

“It’s not state-of-the-industry, at all,” Bill Krueger, principal of Conventions, Sports and Leisure International, said in his presentation on the coliseum and auditorium during a public meeting.

Yes, it’s our old friends CSL, the venue consultant arm of the Dallas Cowboys/New York Yankees-owned concessions company Legends Hospitality, the same consultants who had to withdraw its own economic impact projections for a D.C. United stadium after it admitted screwing them up, overestimated the impact of the San Diego Padres‘ new stadium by including attendees at an unrelated convention center, and cited approvingly a study of LeBron James’ economic impact that the study’s own author had said didn’t mean what CSL said it meant. These are the guys that Knoxville called in to tell them what to do with their arena.

Really, shouldn’t there be some truth-in-labeling requirement that anyone who has been proven to be so spectacularly wrong on previous occasions should have to be presented as such? (I’ve been thinking about this ever since Iran-Contra co-conspirator Elliott Abrams started showing up as a TV pundit, and I thought one of the conditions of his plea deal should have been that he be IDed as “Elliott Abrams, convicted liar.”) The Knoxville News Sentinel can’t be bothered, apparently, so it’s left to me to mock them on my blog instead. I mock thee, Knoxville News Sentinel! How do you like them apples?

Stadium spending is bad for humans and other living things, Thursday edition

Happy National Notice That Stadium Subsidies Are A Bad Deal Day, everybody!

  • The Wall Street Journal notices that the soon-to-be-again Los Angeles Rams are set to join the San Francisco 49ers and Golden State Warriors in building new sports venues without much in the way of public money, and declares this a trend, in California, at least. Though the authors then note that the Sacramento Kings got plenty of public cash, and the San Diego Chargers could yet get a bunch from that city, “despite a wealth of academic studies showing that stadiums and arenas are poor investments when it comes to economic development.” I’m not exactly sure what this all is supposed to add up to, but it does provide a nice roundup of the stadium landscape for anyone who’s been living under a rock.
  • The San Gabriel Valley Tribune asks if the new Rams stadium in Inglewood will provide a big economic boost to the region, and cites a couple of economists and the finance director of Foxborough, Massachusetts in answering, “Nah.” In particular, Vanderbilt’s John Vrooman replies: “The net local impact of a professional sports team is zero, if not negative sum, particularly for an NFL team playing in a monolithic space-eating stadium. … The local sports bars will probably rock, but most direct spending at the stadium stays at the stadium. The injection of new cash flow into the local economy is negligible because it’s coming at the expense of local spending someplace else. The indirect spin-offs are also small because most of the spending leaks out of the economy like a sieve and so the urban/regional multipliers are usually zero, zip … nada.” Stan Kroenke’s poor poor people are going to be awfully disappointed.
  • Milwaukee’s Fox6 looks at the “arena district” the Bucks are promising to create around their new taxpayer-subsidized arena, and notes that in Columbus, while restaurants around that city’s new arena indeed did great, restaurants in other parts of town saw business decline: “Other restaurants went out of business and a lot of people started moving out of the neighborhood and into newer apartments,” said Tony Scartz, a restaurateur in the Brewery District across town from the new arena. “And most importantly, for me personally, was the office space vacancy that was created because people moved out of the Brewery District and into the newer office space down around the Arena District.” This is exactly what you’d expect from the substitution effect, as explained in the Fox6 piece by, um, me.

Tune back in tomorrow, when some city official somewhere will tout the massive economic benefits available from building a new sports venue! They will fight eternally…

Australian state is selling off a whole government agency so it can build more stadiums

The premier of the Australian state of New South Wales is selling off an entire governmental department to raise money to upgrade Sydney’s sports stadiums. I am not shitting you:

Hot on the heels of the privatisation of the state’s electricity poles and wires, the Baird government is selling the operations of the Land and Property Information Service – hopefully for a 10-figure sum – to help fund its $1 billion-plus upgrade of Sydney’s sports stadiums.

Premier Mike Baird has already earmarked $600 million from the Restart NSW fund for the ambitious stadiums plan, which includes the new 50,000-seat stadium at Moore Park, rebuilding Parramatta Stadium and upgrading ANZ Stadium at Homebush.

My knowledge of Australian sports venues is extremely limited, but fortunately we have on hand FoS correspondent David Dyte, who’s a Melbourne native and knows all these stadiums well. I asked him for a rundown, and he replied:

Parramatta Stadium serves the far west of the city, and is home to its own rugby league team. It’s pretty old and I guess could use work. ANZ (aka Stadium Australia) is the 2000 Olympic stadium and is reconfigurable – it hosts Australian football (Sydney, Western Sydney) as well as state level rugby league, and national soccer and rugby. It’s in good shape and does well. Moore Park is central and already has the Sydney Cricket Ground – Australia’s only MLB park – and the Sydney Football Stadium (for all the rectangular field sports I already listed, and home to Easts in rugby league, and Sydney FC in soccer) right next door. Why you need another stadium there, unless it’s a rebuild of the football one, is beyond me. [EDIT: It’s indeed a rebuild of the football one.] It’s already redundant with ANZ, really.

As to the arena, the SEC was fine and didn’t need replacing.

So, um… wtf.

WTF indeed. This would be a pretty remarkable stadium spending spree even without selling the state’s property-licensing arm — which normally brings in a hefty chunk of change to the government each year — to a private company and using the proceeds to pay for it, but … they’re selling off part of the government to pay for new sports stadiums. I mean, guh.

I think that’s all I can handle for today. See you on Monday, unless Stan Kroenke takes Roger Goodell hostage or something.