David Perdue lobbied for tax break to benefit fellow Georgia senator (and WNBA owner) Kelly Loeffler

If the names Kelly Loeffler and David Perdue aren’t immediately familiar to you, they will be soon, as they’re the two Republican U.S. Senators facing runoff elections in Georgia on January 5 that will determine which party controls the Senate. (The Democrats need to take both to reach a 50-50 tie, which would be broken in their favor by vice-president Kamala Harris.) Loeffler is also co-owner of the WNBA’s Atlanta Dream, whose players have called her out for her pro-Trump and anti-Black Lives Matter stances (Loeffler wrote to the WNBA’s commissioner at one point blaming BLM for “the removal of Jesus from churches and the disruption of the nuclear family structure” and promoting “violence and destruction across the country”), even taking the court during pregame warmups wearing shirts endorsing Loeffler’s Senate race opponent.

So while it wasn’t surprising to see Loeffler and Perdue show up together in a ProPublica story on Friday, this one was a bit unexpected:

Sen. David Perdue, R-Ga., privately pushed Treasury Secretary Steve Mnuchin to give wealthy sports owners a lucrative tax break last year, according to a previously unreported letter obtained by ProPublica…

The Treasury ultimately declined to adopt the revision Perdue sought. If the regulation had been altered as Perdue wanted, it would have been a boon for some of his largest donors. Perdue has received hundreds of thousands of dollars in campaign contributions from the owners of professional sports clubs, including now-fellow Georgia Sen. Kelly Loeffler, who co-owns Atlanta’s WNBA team, the Dream.

The tax break in question has to do with pass-through entities, which are corporations whose net profits are declared on the tax returns of the individual owners. When the GOP’s 2017 tax law cut the corporate tax rate from 35% to 20% (among lots of other changes, including double-taxing residents of high-tax states that just happened to be mostly Democratic), it allowed many pass-through business owners to deduct 20% of their business income, effectively lowering their personal income tax rate to the lower corporate one. But not all, and one of the exceptions was owners of pro sports franchises, meaning that Loeffler was set to lose a pile of money as a result of not being included.

Enter Perdue, who as ProPublica writes with eyebrow exquisitely raised, “was not on the committee that crafted the legislation, making his in-the-weeds lobbying on the arcane regulation unusual, congressional experts said.” He did have another reason to be interested in the tax break, though:

A review of his campaign contributions shows that Perdue has taken more than $425,000 from the owners of professional sports teams and their relatives. Some of the top donors include the DeVos family, which owns the Orlando Magic; John Ingram, who owns the Nashville SC soccer team; Los Angeles Kings owner Philip Anschutz; and Cleveland Browns owner Jimmy Haslam.

On the same day Perdue sent Mnuchin the letter, he received $3,000 in donations from three lobbyists at GeorgiaLink Public Affairs Group, a lobbying firm that was representing the Atlanta Braves. Because of the Braves’ ownership structure, it’s unlikely the team would have been affected by the regulation, but around that time, MLB was lobbying on the rule, urging the Treasury to give its team owners the tax break.

Perdue also got $108,000 in donations from Loeffler, her husband, and her Dream co-owner Mary Brock.

Perdue’s letter ultimately went nowhere: Mnuchin didn’t direct the IRS to change the tax law to benefit sports team owners, so Loeffler’s tax bill remains undiminished. But it’s nice little moment to remember the next time you wonder how come so many corporate titans can duck paying taxes so easily: When you can ask the senator who sits next to you to write a letter to the IRS requesting you get a tax break, and enclose $108,000 in checks to sweeten the pot, that’s going to get you a lot more consideration than the average taxpayer.

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Friday roundup: Ex-D.C. mayor says his $534m Nats stadium expense was worth it, Clippers arena stymied by car trouble, MLS franchise fees to go even higher

Shouldn’t posting items more regularly during the week leave less news to round up on Fridays? I’m pretty sure that’s how it’s supposed to work, but here I am on Friday with even more browser tabs open than usual, and I’m sure someone is still going to complain that I left out, say, the latest on arena site discussions in Saskatoon. I guess lemme type really fast and see how many I can get through before my fingers fall off:

 

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Friday roundup: How Kansas City evicted a team for rent non-payment and ended up costing itself $1m, and other stories

This week’s recommended reading: Girl to City, Amy Rigby’s just-published memoir of the two decades that took her from newly arrived art student in 1970s New York to divorced single mom and creator of the acclaimed debut album Diary of a Mod Housewife. (Disclosure, I guess: I edited an early version of one chapter for the Village Voice last year.) I picked up my copy last week at the launch of Rigby’s fall book tour, and whether you love her music or her long-running blog (guilty as charged on both counts) or enjoy tales of CBGB-era proto-gentrifying New York or coming-of-age-stories about women balancing self-doubt and determination or just a perfectly turned punchline, I highly recommend it: Like her best songs, it made me laugh and cry and think, often at the same time, and that’s all I can ask for in great art.

But first, read this news roundup post, because man, is there a lot of news to be rounded up:

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Friday roundup: New sports venues, new sports venue threats, and our dwindling journalistic resources

Deadspin’s Albert Burneko is a national treasure whether he’s writing about sports or movies or punctuation, and his takedown this week of a Fivethirtyeight article that asserts there are too many minor-league baseball teams is very much no exception. Drop whatever you’re doing — which is reading this post, so okay, drop whatever you were going to do after that — and read it now, whether you care about the purpose of sports as entertainment or the role of the media in management-labor relations or the increasing propensity to reduce human beings to measures of technocratic efficiency. With the demise of the alt-weeklies, there are fewer and fewer outlets eager to combine tenacious reporting and big-picture analysis and engaging writing toward the end of helping us understand the world we live in beyond “here are some potentially viral things that happened today,” so we need to cherish those that remain while we can.

And with that, here are some potentially viral (in the not especially infectious sense) things that happened this week:

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Friday roundup: Saints’ $300m subsidy moves ahead, St. Louis MLS announcement on tap, Richmond council votes no on democracy

Sometimes I feel lucky to cover a topic with so many constant absurdities, and then this happens, and I realize that constant absurdities are just the new normal. Anyway, I did get to edit this this week, which is an excellent look at how this week’s absurdity is having potentially catastrophic impacts on people’s lives, so go read it!

But not before you read these:

  • The Louisiana State Bond Commission has approved selling $450 million worth of state bonds to fund renovations to the Superdome, in exchange for the New Orleans Saints signing a 15-year lease extension. As covered back in May, Saints owner Gayle Benson would cover one-third of the bond cost, leaving Louisiana to pay off $300 million, bringing the Saints’ five-decide subsidy total to a cool $1.442 billion. In exchange, the Saints will sign a 15-year lease extension — with another 15-year option, but there’s no way they’re going to extend their lease again without more subsidies the way this gravy train is rolling — which comes to state taxpayers ponying up $20 million a year for the presence of an NFL team, which is a hell of a lot of money, though not as much as Indiana pays the Pacers, because Indiana.
  • The St. Louis Post-Dispatch reported this week that St. Louis will be announced next Tuesday as the next MLS expansion city, bringing the number of teams in the league to a cool 154. (I think it’s actually 28, but honestly the number changes so fast it’s hard to keep track.) Deadspin read the announcement that there would be no public subsidies for the as-yet-unnamed team’s stadium and excitedly reported that the deal “might not completely fleece the city”; sadly, it will actually involve about $60 million in public subsidies, but since about half of that is coming from the state, not the city, that Deadspin headline is still technically correct, right?
  • The Richmond city council has voted 5-3 against allowing a referendum on the city’s proposed new $350 million city-subsidized arena on the November ballot, because voting is for elected officials, not regular folks. Though regular folks do still get to vote on electing elected officials, something that referendum sponsor Reva Trammell clearly had in mind when she said following the no-voting vote: “I hope the citizens hold their feet to the fire. Every damn one of them that voted against it.”
  • Two-plus years after the arrival of the Hartford Yard Goats in exchange for $63 million in public stadium cash — plus a couple million dollars every year in operating losses — the Hartford Courant has noticed that stadium jobs are usually part-time and poorly paid. Not included in the article: any analysis of how many full-time jobs could have been created by spending $63 million on just about anything else.
  • New Arizona Coyotes owner Alex Meruelo said he intends to keep the NHL team in Arizona, but that keeping it in Glendale is a “difficult situation,” at which point a Glendale spokesperson said that city officials would meet with Meruelo “to see how we can help him achieve his goals of success.” Which is all fine and due diligence and all, but given that helping Meruelo “achieve his goals” is likely to mean paying him money to play in Glendale like the city used to do, it’s not exactly promising; if nothing else, Glendale officials would do well to remember that Meruelo currently has exactly zero better arena options elsewhere in the state, so he’s not exactly negotiating from a position of strength.
  • Joe Tsai, who was already set to buy the Brooklyn Nets from Mikhail Prokhorov, has officially exercised his option to purchase the team, plus the Barclays Center arena to boot, for a reported $3.5 billion. Given that the arena is currently losing about $21 million a year, this seems like an awful lot of money even if the team does employ whatever’s left of Kevin Durant. Since Tsai already owns the New York Liberty, though, maybe it at least means that WNBA franchise will finally return to the city from its exile in the suburbs.
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Friday update: Bad D.C. arena math, bad Bucks arena math, bad Columbus ticket tax math

It must be September, because my TV is filled with Jim Cantore and Anderson Cooper standing ankle-deep in water. But anyway:

  • Washington, D.C., is about to open its new Mystics home arena and Wizards practice facility, and Mayor Muriel Bowser says it’s a model of how the city would build a new NFL stadium as well. “We know [sports] can help our bottom line by attracting people to our city, but it also has a big impact when we’re winning on our collective psyche,” says Bowser of an arena that got $50 million in public subsidies for two teams that were already playing in D.C. anyway. Maybe she should go back to using her terrible soccer stadium deal as a model instead.
  • People in Calgary are starting to ask whether, if the city is looking to spend $3 billion on hosting the 2026 Olympics, maybe it should build a new Flames arena as part of the deal? Camels, man.
  • Buffalo Bills co-owner Kim Pegula says she’s going to wait until after the gubernatorial elections this November to start negotiating a new stadium with whoever ends up in charge of the state. It won’t be the lox-and-raisin-bagel lady.
  • Speaking of the Pegulas and New York’s current governor, they’re planning an $18 million upgrade of Rochester’s arena that hosts the Rochester Americans minor-league hockey team (which the Pegulas also own), with costs to be split among the owners and city and state taxpayers. Split how? Sorry, no room in the Associated Press article, ask again later!
  • The AP did find time to fact-check Wisconsin Gov. Scott Walker’s claim that the new Milwaukee Bucks arena would return three dollars in new taxes for each one spent, and found that “Walker omits some of the state money spent on the 20-year arena deal and relies on income tax estimates that experts call unreliable.” I could’ve told them that — in fact, I did, three years ago.
  • “‘Ticket tax’ proposal could lead to higher prices on movies, theater, sports in Columbus” reads a headline on ‘s website, something that the station’s reporter asserts in the accompanying video without saying where he got it from. He’s at least partly wrong: Ticket prices are already set as high as the market will bear, so unless the ticket tax changes the market — in other words, unless people in Columbus are forced to spend more on movies and theater and such because the other options (staying at home and watching TV, going out to eat) aren’t good enough, mostly this will just mean prices will stay roughly the same but a bigger share will go to theater/team owner’s tax bills. (I could try to find an economist to estimate exactly how big a share, but isn’t that really WSYX’s job?)
  • Former Oakland A’s exec Andy Dolich says the team owners may be looking at buying both the Howard Terminal site and the Oakland Coliseum site, and using the revenues from one to pay the costs of prepping the other for baseball, which, if the Coliseum site is such a cash cow and Howard Terminal such a money pit, wouldn’t they be better off just buying the Coliseum site and developing that? Or is the idea that Oakland would somehow give up the Coliseum site at a discounted price in order to get a new A’s stadium done? I have a lot of math questions here.
  • With nobody wanting to spend $250 million on a major renovation of Hartford’s arena, the agency that manages the XL Center is now looking for a $100 million state-funded upgrade instead. Still waiting to hear whether this would actually generate $100 million worth of new revenues for the arena; if not, the state would be better off just giving the arena a pile of cash to subsidize its bottom line, no?
  • Cobb County is only letting the Atlanta Braves owners out of part of the $1.5 million they owed on water and sewer costs for their new stadium. Yay?
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MSG evicts Liberty, local official threatens to respond by pulling arena’s tax break

Back when Madison Square Garden announced it was putting the New York Liberty up for sale last fall, I wondered where the team would play once offloaded, noting that Brooklyn’s Barclays Center is pretty booked up with concerts, and Newark’s Prudential Center was pretty much an attendance disaster when the Liberty played there during MSG renovations a few years back. But even I didn’t count on MSG giving the Liberty the boot as soon as this season — while it still owns the team — and relegating games to a tiny community gym in suburban Westchester County:

For the upcoming season, the team will be downgraded to the Westchester Community Center, a dinky, 5,000 seat arena in White Plains, New York. The New York Liberty often had 10,000 attendees during their 2017 season home games.

The Liberty will actually play two home games at the Garden this year, but both will start at 11 am, presumably so that the arena can be cleared out in time to hold yet another Billy Joel concert or whatever in the evening. The rest will be in White Plains, in a space where I have been once in my lifetime as a New Yorker, for a White Plains Golden Apples USBL game in the 1980s of which I have precisely two memories: seeing Spud Webb pass to Manute Bol, which was extremely similar to watching someone hand things up to a man on a ladder; and the daunting challenge of getting a Metro-North commuter train to White Plains, then walking to the arena, and that was when I still lived in Manhattan, where the trains at least leave from.

Manhattan borough president Gale Brewer, who also lives in Manhattan, is nonetheless hopping mad about New York City’s only pro women’s sports team (no, Sky Blue F.C. doesn’t count as in New York City, and roller derby doesn’t count as a pro sport) getting exiled to the ‘burbs. Brewer is mad enough, in fact, that she’s threatening to hit MSG where it hurts, by repealing their eternal tax exemption on the Garden that is now saving them (and costing the city) $42 million a year:

“I and many of my colleagues in the City Council and State Legislature have never been convinced that this abatement constitutes good policy,” Brewer wrote.

“Shameful actions like this one, banishing a popular women’s professional sports team where its fan base cannot reach it, do not help your case.”

That’s a fine enough point, but, uh, Gale, you’re not actually on the city council or in the state legislature. And it’s actually the latter of those that has jurisdiction over the tax break, which was extended in 1982 in exchange for the Knicks and Rangers promising not to move for at least ten years, and which never expired because then-mayor Ed Koch forgot to have someone write in an expiration date.

A more viable threat by city officials, if Brewer wants to go that route, would be responding to MSG evicting the Liberty by in turn evicting MSG: The World’s Most Famous Arena only has the right to sit atop the entombed remnants of Penn Station thanks to a special zoning permit from the city, and that is set to expire in 2023. I’ve been skeptical that the city would give an entire arena and three (now two) pro sports teams the heave-ho, even in order to build a new Penn Station entrance, but maybe angry WNBA fans will be the catalyst? Okay, probably not, but at least it’d be a more realistic thing for Brewer to grandstand on.

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Friday roundup: Tons of news, but you’ll forget it all once you see that Houston is spending public money on a pro rugby stadium

And in other news that doesn’t involve proposed Tampa Bay Rays stadium sites:

  • United Airlines is spending $69 million on naming rights to the Los Angeles Coliseum in advance of the 2028 Olympics, but IOC rules prohibit corporate names during the Olympics, oops. Hope you enjoy the most expensive college-football naming rights deal in history, United!
  • Hotel revenue fell 16% in San Diego last year after the Chargers left town, but went up 0.2% in St. Louis after the Rams left. I’m not honestly sure what if anything this means — you’d really have to look at hotel revenue on football weekends to do this right, and it doesn’t look like this study did — but feel free to speculate wildly.
  • Did I mention the Yahoo Finance article yet that compares the Amazon HQ2 chase to the competition to host the Super Bowl, and cites me saying that while Amazon will bring more jobs, “that said, there’s almost no way it’s worth the kind of money that cities are talking about”? Well, now I have, enjoy!
  • AL.com has recalculated the public costs of a proposed University of Alabama-Birmingham football stadium and come up with a total of $18.2 million a year — $10.7 million from a bunch of county taxes, $3.5 million from a new car rental tax surcharge, $1 million from other county funds, and $3 million from city funds — not the $15.7 million I had previously reported. UAB and a naming rights sponsor and other private contributors, meanwhile, would only put in $4 million a year, and only for the first ten years. Out of his goddamn mind, I tell you.
  • Norman Oder of Atlantic Yards Report filed a Freedom of Information Law request to see the competing bids for the Belmont Park site that eventually got awarded to the New York Islanders, and was shot down on the grounds that it would “impair present or imminent contract awards.” Wait, wasn’t the contract already awarded? Will it be okay to ask again once it’s too late to do anything about it?
  • The WNBA’s Chicago Sky are moving to the new DePaul basketball arena that the city of Chicago helped pay for, which I guess is marginally good for Chicago in that it gets to steal a tiny sliver of economic activity from Rosemont, screw those guys, right? (Actually, Rosemont is apparently a gated community, so maybe screw those guys.)
  • A New Orleans Pelicans game was delayed because the arena roof leaked. No one is demanding that a new arena be built just yet that I’ve heard, but given that the current one is 19 whole years old, it’s gotta to be a matter of time, even if this one does have a fire fountain.
  • The Pittsburgh Pirates are threatening to sue the city-county sports authority over who’ll pay how much for $10 million in improvements to their stadium, because apparently the people who write these stadium leases are idiots.
  • If you enjoy this site but were thinking, “Wouldn’t this be better as a YouTube video with lots of animated charts?”, Vox has got you covered.
  • The Houston city council has approved spending $3.2 million in tax dollars on a pro rugby stadium for the Houston SaberCats, who are a pro rugby team that is going to play in a pro rugby league, which councilmember Jack Christie calls “a beautiful example of public-private partnerships that we ought to look at in the future, because as far as I have heard, there’s not been one city tax dollar used for this development.” I’m done. Have a good weekend.
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If Madison Square Garden sells the Liberty, where are they going to play?

The owners of the New York Liberty, one of the WNBA’s three remaining original franchises still in the same city they started off in, are putting the team up for sale. That’s of interest if you’re a WNBA fan — I’m actually a former Liberty season ticket holder, so I qualify as one of the few and the proud even if I haven’t been to see a game in the last couple of years — but also for readers of this site in general, because of what it says about the arena industry.

In brief: The Liberty are owned by James Dolan’s Madison Square Garden Co., which also owns the Knicks, the Rangers, and its namesake arena. The team, and the WNBA in general, was launched in 1997 for a bunch of overlapping reasons: to take advantage of excitement over the 1996 U.S. women’s Olympic basketball team, to fill dates in the otherwise-slow summer months (which is why the league plays outside of the traditional wintertime schedule for basketball), to make the NBA look women-friendly and provide a more affordable product to rope in fans priced out or alienated by the men’s game, and to beat down an attempt by the independent American Basketball League to horn in on the NBA’s pro hoops monopoly. The ABL was gone within a year and a half, and the Olympians were soon forgotten, but the WNBA has burbled on for another two decades, with modest attendance and revenues but remarkable longevity for a startup league, in no small thanks to the NBA’s financial backing.

That’s starting to change, though: While originally all the WNBA teams were fully owned offshoots of NBA siblings — down to teams getting sister names, like the Sacramento Monarchs to complement the Kings and the execrably named Detroit Shock to go alongside the equally-terribly-named-if-you-think-about-it Pistons — that’s starting to change, with more and more teams independently owned and operated. And the Liberty would be the biggest independent team of all once cut loose from MSG, which clearly has decided that it would rather get out of the women’s basketball game and stick to its core business of crappy men’s teams and lots and lots of concerts.

The big question for a future Liberty owner, meanwhile, is: Where are they going to play? Renting out MSG is a possibility, of course, but unless there’s some sweetheart lease deal baked into the sale agreement, it would likely be prohibitively expensive, since you’d be bidding against all those concerts. The Barclays Center in Brooklyn is another option that might come slightly cheaper, but again it’s pretty busy with concerts, even in the summer. (One problem with a basketball schedule is that it seriously restricts your flexibility for hosting concerts, which are typically booked long after a team’s home games are set in stone.) When MSG was getting renovated in the summers a few seasons back the Liberty played in Newark’s Prudential Center, but attendance was pretty bad (I picked up Stubhub seats ten rows from the court for one game for $3 apiece); Nassau Coliseum desperately needs something to fill dates, but it’s way out on Long Island.

I suppose a new Liberty owner could try to demand a new arena of their own, but that’s not going to go far when your fan base is the size of a WNBA team’s. Maybe this could all be part of the plan to build a new arena for the Islanders out by Belmont Park, something that Dolan is a part-investor in, so … I dunno, we’re deep into the tea leaves here. It’s an interesting moment, though, one that could end up revealing a lot about not only the future of women’s pro sports, but how arena managers are thinking about the relative value of sports vs. other events. I’ll have more on this soon, I hope.

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Wizards’ $50m practice arena renderings are scenes from a post-apocalpytic nightmare

New renderings for the Washington Wizards practice facility (and Mystics home arena) to be built with at least $50 million in city money were released yesterday, and, I’m sorry, what?

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The new arena will apparently be surrounded by a massive frozen pond, or maybe a thin coating of a liquid polymer. Fortunately, no one will be around to try to walk on it, since that could get ugly.

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Is that a WNBA player? If so, why is she wearing so much makeup? What’s suspending the banner (?) in midair like that? And why on earth is there a film reel countdown projected (?) on a brick wall? What is it counting down to? Will there be any concession stands, or will the whole place just feel like an empty hotel lobby?

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The most important part of any new development: lens flare.

new-dcpract-5Put it all together and you have … dear lord. At least the rest of human civilization appears to have been destroyed in whatever cataclysm turned the very ground into a shiny flat surface, so no one will be around to see this. When the aliens land, though, they’re going to be disappointed that there’s nowhere to buy any curly fries.

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