Category Archives: Arizona Diamondbacks

D-Backs want county to sell stadium to city so they can get lease breaks

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Just when I thought there was nothing new under the sun in the stadium game, there comes this: The Arizona Diamondbacks are trying to boost their profits by getting their landlord, Maricopa County, to sell their stadium to the city of Phoenix.

How would that help the D-Backs’ bottom line? Well, the team would no longer have to pay $4 million a year in rent and maintenance expenses to the county; instead, they would “pay Phoenix rent, the amount of which has not been determined,” in the words of the Arizona Republic. But the team owners also want more control over how to spend a capital improvement fund currently controlled by the county, and more control over non-baseball events at Chase Field — plus, possibly, to reduce seating in order to create more seat scarcity at the 48,000-seat stadiumand allow the team to charge higher ticket prices, something that’s drawn the ire of former Phoenix mayor Skip Rimsza, who charges that this would violate promises that the D-Backs would keep some seats inexpensive when they got $238 million in tax money to help pay for construction.

The Republic also chimed in with its own thoughts on the seat-scarcity issue:

The Diamondbacks have boasted about keeping tickets affordable. The team’s $15.74 average ticket price this season ranked second-lowest among major-league teams…

But those low ticket prices also hinder the team’s ability to spend money on players. The Diamondbacks have one of the lowest payrolls in baseball.

Arrrrrrrrrrrrrrrrrrrrrrrrgh.

First off, let’s dispense with the notion that sports teams operate by throwing all the money they make into a huge bucket, and then spending it all until it’s gone. Most team owners are fabulously wealthy, and have the cash reserves to spend an extra $10 million on an outfielder if they think it’ll help the team — and more important, help sell tickets.

And that’s the key point: When behaving economically rationally (the usual caveats about rational sports owners apply, obviously), owners will spend money on players when they think it’ll help produce enough in profits to pay for the added cost. And while more expensive tickets certainly help (it’s tough to pay for a big free-agent signing one $5 ticket at a time), fewer seats hurt, because it’s tougher to recapture your investment by selling tons of tickets once you’ve built a pennant-winner. (You can raise prices even more once the team is good, obviously, but you can do that whether your stadium holds 40,000 or 48,000.)

So what’s driving the D-Backs to cut payroll? Nothing — in fact, the team added nearly $20 million in payroll over the last winter. They’re certainly not spending like the Yankees and Red Sox, but they’re not going to unless they can convince Maricopa County to sell their stadium to the city of New York, not Phoenix.

In any event, this looks like the very early stages of negotiations — in fact, if I’m reading between the lines correctly, it was Rimsza who broke the news after learning of the talks. Why the Diamondbacks would need to orchestrate a transfer of ownership just to get some lease concessions — or, for that matter, why the city would be more willing to give up some rent payments and control over the stadium than the county would — isn’t exactly clear at the moment. But if nothing else, this is probably the first sign that with a now 14-year-old stadium, the D-Backs are preparing to get back on line for more public aid, now that the initial excitement of getting the last round has worn out.

Selig, D-Backs endorse Cubs stadium TIF

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Baseball commissioner Bud Selig has officially come out against an Arizona-wide ticket tax scheme to help fund a Chicago Cubs spring-training stadium. In doing so, Selig joins every other team in Arizona, who would rather not be helping to foot the bill for their rival’s new home, no matter how many Cubs fans boost the gate at their spring games thanks to the team’s presence in Arizona rather than Florida.

Selig says he’d rather see a tax-increment financing scheme. The Arizona Diamondbacks agree, which should be no surprise given that a TIF was their idea in the first place; however, team president Derrick Hall hedged a bit, saying, “We would be open to [a TIF], but believe the legislators are not in favor of it. … We are just seeking other solutions so as to not tax fans who attend any and all spring games.” In other words: We don’t care who you tax, Arizona legislature, so long as it ain’t us.

Cactus League teams balk at helping fund Cubs stadium

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The city council of Mesa, Arizona, agreed last month to put a vote on the November ballot on building a new $84 million spring-training home for the Chicago Cubs, who otherwise were threatening to move to Florida. This isn’t that unusual: Baseball teams move their spring facilities all the time, which makes for lots of opportunities to set up bidding wars for stadium subsidies.

Where it gets interesting is in how Mesa has proposed to fund this one: Partly with a rental-car surcharge, but partly with a leaguewide ticket tax on Cactus League games, on the argument that since the Cubs are the league’s biggest draw, the other teams in the league should chip in to keep them around. (Most economists will tell you that ticket taxes generally come out of team owner pockets, as they’re prevented from raising prices as high as they would otherwise.) The rest of the league, unsurprisingly, is not too thrilled, and several teams are openly opposing a ticket tax to help the Cubs — including Jerry Reinsdorf, owner of the rival Chicago White Sox, who play in Glendale.

Mesa Mayor Scott Smith replied: “Is this the same Jerry Reinsdorf that skipped out on Pima County taxpayers who had spent tens of millions of dollars to provide him with a taxpayer-funded stadium, to come to Glendale, where Maricopa County taxpayers provided him a Taj Mahal spring-training facility?” Noting that Reinsdorf also has a publicly subsidized stadium in Chicago — one that he got by threatening to move to Florida — Smith added, “The irony is delicious.”

The Arizona Diamondbacks are opposed to the Mesa deal as well, and baseball blogger Brandon Larrabee can’t help but note that they’re “an interesting addition to the Arizona anti-tax crowd, given that their own stadium tax was so controversial it got a Maricopa County Supervisor shot.” By a crazy guy, admittedly, but if you want to take it as a cautionary tale, be my guest.