Inside Arte Moreno’s Angels-to-Tustin threat and why it may be backfiring

I have an article up this morning at Vice Sports on Los Angeles Angels owner Arte Moreno’s threat to move his team to an abandoned air base in Tustin, and how it’s not going entirely according to plan. The upshot: Moreno is trying the tried-and-true gambit of getting different municipalities to bid against each other for his team’s presence, except that so far nobody is interested in playing, with Anaheim Mayor Tom Tait’s insistence that Moreno share profits from any development on city-owned land being followed by Tustin officials chiming in that, hey yeah, that sounds like a good plan for us, too.

In researching the story, I got to talk to Tait yesterday, and he stressed that he’s not too concerned about the Angels leaving Anaheim, since stadium-sized available plots of land are hard to come by in Southern California at the price Moreno wants ($1), and leaving the area entirely would be insane for a franchise that just landed a $3 billion cable deal. On the subject of why so few mayors take a stand like he did, meanwhile, he had this to say:

“They gave us a study that it creates $200 million of economic activity and $5 million of taxes a year, which is flat-out wrong. [But some people] might believe that study…

“It’s like a coordinated PR campaign that I want them to leave. I get kids asking me at schools why I want the Angels to leave. So it’s a lot of pressure.”

Moreno still has options, of course, among which is simply waiting for a more amenable dance partner to show up: As I note in my Vice piece, Tait is facing an opponent in the upcoming mayoral election who publicly accused him of risking a repeat of the Dodgers leaving Brooklyn in order to “make a quick buck on more generic development.” But it’s at least a positive sign that a couple of municipal officials are looking at what their city would get in return for stadium subsidies, not just what it takes to make sports owners happy. Maybe if we’re lucky it’ll catch on, and — what’s that, SaintPetersblog, in your report on the latest in the Tampa Bay Rays stadium mess?

[Hillsborough County Commissioner] Hagan also said St. Petersburg’s Mayor Rick Kriseman “has to protect his city and do what’s best for his constituents,” but also “he sees the big picture and the opportunity St. Pete has to really do something special (by redeveloping Tropicana Field).”

That, of course, raises the question, if Tropicana Field is more valuable as something other than a baseball stadium…wouldn’t the same go for land in Tampa?

Maybe, just maybe, we have the beginnings of a mini-trend here. If those goldurn schoolkids don’t ruin everything.

Tustin to Angels: Sorry, Arte, no free land here for stadium, either

The Tustin city council had its latest closed-door meeting about building a stadium for the Los Angeles Angels last night, and … it was behind closed doors, so we don’t actually know what they talked about.

We do know, however, what they’re thinking. City Manager Jeffrey Parker:

“For us, [the biggest question is] how the financing would be put together to make this happen,” Parker said…

In Anaheim, an appraiser valued the land in question at $225 million. Parker said the Tustin land could be worth a similar amount and said the city would expect to make back that amount on any land provided to the Angels, most likely from lease payments or a share of development profits.

“We want to protect that $200 million,” Parker said. “We want a rate of return on that land value.”

That’s pretty huge: Parker is saying that not only would Angels owner Arte Moreno have to pay for his own stadium costs, but he’d have to reimburse Tustin for the value of the land it would be giving up. Since that’s pretty much the same deal that Anaheim Mayor Tom Tait is asking for — and which Moreno dismissed as “going backwards” — this bidding war isn’t going at all how the Angels owner must have wanted it to.

This is actually a pretty remarkable moment: Two local elected officials demanding that their cities actually get something significant in return for helping out with a stadium, instead of the usual reaction of asking when to jump and how high. It’s too soon to tell if this will start a trend, or will even hold up — the traditional response from team owners is to wait until somebody more amenable to their demands is elected to public office — but it’s sure fun to watch while it lasts.

Moreno officially shuts down talks with Anaheim on Angels land deal, makes goo-goo eyes at Tustin

The Los Angeles Angels‘ season is decidedly not over — they open the American League Division Series on Thursday, against either the A’s or Royals — but Angels president John Carpino still managed to upstage his own team’s division crown on Friday, by announcing that he was walking away from negotiations with Anaheim on renovating his stadium, and could instead look into moving the team to the nearby small city of Tustin:

“Our goal from day one was to ensure a high-quality fan experience well into the future,” John Carpino, the Angels president, said in a statement as his team prepares for the playoffs. “We have spent a lot of time on this memorandum of understanding, and after 12 months, we feel our best course of action is to dissolve this non-binding agreement.

And this from Angels owner Arte Moreno:

“It’s been over a year,” Moreno said. “We’ve gone backwards. We haven’t accomplished anything.”

What’s going on here, in a nutshell: Moreno declared last year that he’d be happy to renew his lease and do stadium renovations on his own dime, if the city of Anaheim would just give him the right to develop his stadium’s parking lot for one dollar Anaheim Mayor Tom Tait then conducted an appraisal of the land the Angels wanted, and determined that it was worth between $245 million and $325 million, significantly more than Moreno was planning to spend on renovations.

This was, as Deadspin aptly puts it, “how to call a team’s bluff on stadium subsidies.” Moreno, though, had more bluffs up his sleeves than that, and speculation immediately began that the team could move somewhere else in Orange County. Say, Tustin, which has a large decommissioned marine air station it could hand over for a dollar if it really wanted to. Or Irvine, which … is also in Orange County, so sure, why not?

Whether this Tustin threat is for real or just leverage is hard to say: As I told the Orange County Register, it’s conceivable that Moreno could come up with enough cash for a stadium if he were given enough free land, and maybe some property or sales tax kickbacks or something. Or it could be that he just hopes the fear of being the guy who lost the Angels to Tustin would be enough to scare Tait into capitulating. It shouldn’t be — if the Angels left, Anaheim would suddenly have $325 million worth of vacant land it could then develop, and Angels fans really wouldn’t be put out by driving a few extra miles to Tustin — but this is what brinksmanship looks like. The Tustin city council, meanwhile, has called a special closed session (preceded by public comments) for 4:45 pm tomorrow to discuss a possible land deal with Moreno.

And finally, let’s not forget this, from the Voice of OC:

The Angels’ stadium lease with Anaheim runs out in 2029. A previous clause in the lease allowed the Angels to leave in 2016. If the owners didn’t use the exit clause, the team was locked in until 2029. But last year, the city council gave the Angels three more years, until 2019, to decide whether to stay in Anaheim or go elsewhere.

Great negotiating there, Anaheim city council.

Appraisal confirms: Angels seeking $245m in land to fund $150m in renovations

One more important news item from last week: On Friday, the city of Anaheim released its appraisal of the value of the Los Angeles Angels parking lots that team owner Arte Moreno wants to get for free in exchange for renewing his lease. And the verdict is:

The appraised value of the Stadium Site under premise #1, the Angels’ lease is renewed, is:

• $225M under a leasehold scenario and
• $245M under a fee simple, or sale, scenario.

Both approaches to value, in premise #1, include consideration of the need to continue to provide 12,500 parking spaces for stadium events, shared with new, commercial development on the site.

The appraised value of the Stadium Site under premise #2, the Angels’ lease is not renewed and the team relocates, is:

• $300M under a leasehold scenario and
• $325M under a fee simple, or sale, scenario.

Both approaches to value, in premise #2, do not include the need to continue to provide 12,500 parking spaces for stadium events.

Or put even more simply: The parking lots are worth $245 million with the Angels sitting in the middle of them, and $325 million if the Angels were to clear out. That’s a hell of a lot of value that Anaheim would be giving away, toward the top end of the $30 million to $380 million estimates that had been made previously, and about twice what the Angels would need to pay for their proposed renovations.

Angels execs haven’t responded yet to the appraisal — beyond last week’s letter complaining that putting a value on the land at all might give the general public the idea that the land is valuable — but Anaheim Mayor Tom Tait did say that he thinks the city should share in development profits once Moreno’s stadium upgrades are paid off. That’s actually pretty reasonable — probably overly reasonable, given how easy it is for sports team owners to hide profits — but somehow I don’t expect Moreno to jump at the opportunity.

Angels execs blow up at Anaheim for wanting to negotiate things in negotiations

Apparently that Bill Shaikin column in the L.A. Times the other day was just a warning shot in the simmering Los Angeles Angels lease war with Anaheim, because now Shaikin has followed up with a news article noting that “relations between the two sides have grown so strained that each side is accusing the other of trying to make significant changes to the terms of the deal”:

In a March 21 letter to the city, Angels attorney Alex Winsberg complained that a draft agreement presented by the city two days earlier “fundamentally conflicts with the basic intent of the deal … an exchange of development rights for the obligation to renovate and maintain the stadium.”

In another letter, dated April 24 and posted on the Voice of OC website, Angels President John Carpino said the team was “shocked” by the draft agreement that he said “removed any inducement for the Angels to undertake the substantial economic risk and responsibility negotiated into the framework of the deal that was initially proposed by the City of Anaheim.”

In a March 31 letter to the Angels, City Attorney Michael Houston reminded the team that the deal framework — called a memorandum of understanding (MOU) — was subject to change upon further negotiations.

“It bears mentioning that the Angels … are currently proposing terms that differ from the MOUs,” Houston wrote. He added: “Temperance, diligence and trust are the basis for our negotiations.”

I’m not so sure this actually qualifies as “strained” — it looks to me more like the usual push-and-pull of negotiations over a deal that was penciled out but not actually finalized — but clearly Angels owner Arte Moreno wants to put out there that the city of Anaheim is being unreasonable in not just rubber-stamping whatever he wants the MOU to mean. (To be clear, Moreno didn’t leak the letters; they were released as part of standard public-records procedure.)

The actual term sheets from the city of Anaheim were redacted from the Angels missives, so there’s no way of knowing exactly what Moreno is objecting to here. The one piece that wasn’t redacted was that the Angels owner doesn’t want the city to conduct an appraisal of the value of the land that he would be getting for free in the deal — something that is a huge sticking point, because it could be anywhere from $30 million to $380 million —  because it could “be misunderstood by the general public as to the value that the City is providing” and “will lead to an unworkable situation.” Anyone here think that means anything other than “Don’t tell people what we’re getting out of the deal, or the jig is up!”?

L.A. sportswriter really bugged by the fact that the Angels don’t have a new lease deal already

Something has to give in stalled stadium lease negotiations between Angels and Anaheim

No. No, it doesn’t.

The above column, by L.A. Times sportswriter Bill Shaikin, is a stellar example of concern-troll journalism, claiming respect for Anaheim Mayor Tom Tait’s opposition to a free-land deal for Angels owner Arte Moreno that could be worth as much as $380 million in public subsidies, while simultaneously shaming him for not just buckling under and cutting a deal, summed up neatly in this classic sentence: “This is a tip of the cap toward a mayor who has been so incredibly successful in framing the debate surrounding the Angels‘ stadium lease negotiations that the process has ground to a dead halt.” The arguments presented by Shaikin — who’s done some good work in the past, but for some reason seems to have made a new Angels lease a personal vendetta — come down to these:

  • Moreno wants to spend $500 million of his own money to “revitalize property owned by the city,” which in this case means developing the land that he would get from the city for free, for his own use.
  • The other four members of the Anaheim city council haven’t been vocal in opposition to the deal, “apparently taking political cover behind Tait.”
  • The only way to develop the Angels parking lot is to build parking structures for Angels fans to park in, and this makes the Angels “the most logical developer.”
  • $500 million! Did I mention $500 million?
  • Moreno could move the Angels to Tustin.

All of this is reason for Tait to explore whether there’s a reasonable deal to be made here, but it’s hardly a cry for urgency — after all, there’s no indication that Moreno has even seriously explored sites in other nearby towns, and it’s hard to picture Tustin, say, putting together a Cobb County–style sweetheart deal to wrench the Angels away from Anaheim. Talking about development deals is fine and dandy and the proper role of mayors; calling for something to be done now because it’s been months already is the job, I guess, of sports columnists, though given that it’s also how we end up with terrible lease deals that nobody vetted properly, I kind of wish it weren’t.

Angels economic impact study was conducted by subsidiary of Angels’ new concessions contractor

And now for something completely different: actual journalism!

The company that produced a favorable report on the economic impact of the Angels, which city officials have touted as they mull a controversial new lease framework for Angel Stadium, is related to another company that won the baseball team’s food and beverage concession contract soon after the report’s release, records show.

That’s from the Voice of OC, one of the nonprofit journalism sites that’s sprung up in recent years, which reports that the study that found that the Los Angeles Angels generate $200 million an annual economic impact for the city of Anaheim (a figure that the Orange County Register had already thoroughly debunked) was conducted by “Conventions, Sports & Leisure International LLC or CS&L, a subsidiary of New York-based Legends Hospitality Holding Company LLC.” Legends is first and foremost the company that the New York Yankees and Dallas Cowboys set up to run their concessions at their new stadiums, and it recently won the Angels’ contract, too.

The Voice of OC was actually tipped off to this story by one of its commenters, but still, props to them for actually reading their comments and doing the followup reporting. Not to mention props for getting this quote from Los Angeles good-government advocate Bob Stern: “The question would be to them: What were you thinking?”

Angels owner Arte Moreno’s lease subsidy demands are still on hold, in case you were wondering. Given his past behavior, this means it’s probably about time for him to threaten to move to Rancho Cucamonga.

How a rumor becomes a news item: The Angels-to-Irvine story

There’s a fascinating little experiment in journalism echo-chamberism on display in today’s Los Angeles Times, where Bill Shaikin and his editors perform the following bit of quote alchemy:

  • Al Murray, the mayor of Tustin, the small suburb that met with Los Angeles Angels owner Arte Moreno last week to talk about a possible stadium project, told Shaikin on Tuesday night that (in Shaikin’s words) “he had heard that Moreno had talked with the city of Irvine as well.”
  • Representatives of both the Angels and the city of Irvine denied that any talks had taken place, and an Irvine city spokesperson said that its existing redevelopment plan “does not contemplate in any way a sports stadium.”
  • Shaikin led off his story with the tease: “Is it Anaheim or Tustin for the Angels? The mayor of Tustin does not believe that.”
  • The Times editors slapped on the headline “Could Angels put Irvine into play for stadium?” providing an outstanding example of Betteridge’s Law of Headlines.

Could the Angels move to Irvine? Sure, in theory. They could also move to just about anywhere else in the greater L.A. area, or to Hawaii, or to my dining room. (I may need to move some boxes to make room for the necessary luxury suites.) Anyone can throw darts at a map and pretend that what results is a legitimate move threat — and as we’ve seen before, team owners love to do just that when trying to throw a scare into their current hometowns during stadium talks.

The most useful bit of info in Shaikin’s piece is his observation that wherever he goes, “because most California cities no longer pay to build venues for professional sports teams, Moreno’s best bet might be to pay the stadium cost and hope to recoup the investment from surrounding development.” That’s certainly the plan in Anaheim, but the amount of land to be turned over for redevelopment to make it worth Moreno’s while is so vast that Anaheim officials are balking; would this kind of plan make any more economic sense in Tustin, or Irvine, or (where’s my dartboard?) Rancho Cucamonga? That’s outside the scope of Shaikin’s article, sorry — tune in again tomorrow to latimes.com and maybe you’ll get some real news!

 

Angels owner declares “stalemate,” visits officials in another suburb that’s also not Los Angeles

Los Angeles Angels owner Arte Moreno declared on Friday that talks to have the city of Anaheim give him land valued at somewhere between $30 million and $380 million in exchange for not exercising an opt-out clause were “at a stalemate” and that “we haven’t crossed that line yet” of shopping for a new home. Then the next day, a team spokesperson revealed that Moreno had earlier in the week met with officials from the city of Tustin about building a new stadium there:

“We did have an initial meeting with Tustin,” said Marie Garvey, a consultant retained by the Angels to handle stadium negotiation issues. “We’re still in discussions with the City of Anaheim, but we have to take a long-term view and explore all of our options to insure we have certainty for the future.”

So, for those of us not familiar with SoCal geography, what the heck is a Tustin? It’s another Orange County suburb about five miles down Interstate 5 from the Angels’ current home, and Cuba Gooding Jr. grew up there, and, um, that’s about it. Tustin also has a decommissioned Marine Corps Air Station that’s being targeted for redevelopment, and which is so massive (1,600 acres) that it shouldn’t have trouble finding room for a new stadium.

Where Moreno would come up with the money to actually build a stadium in Tustin is another story — would he want free development land there, too? — but that’s not the point of these kinds of meetings, which Garvey described as being “in the infancy stage.” It’s about creating leverage. Now to see if Moreno can get a bunch of Angels fans to show up at the next Anaheim city council meeting with “Don’t make us drive five more minutes to the game!” placards.

Anaheim still has no clue how much land it wants to give Angels is worth

If you’ve been following the controversy over the Los Angeles Angels‘ stadium lease controversy, you’ll recall that the key dispute is over the value of the development rights that Anaheim would be granting to the team: estimates are anywhere from $30 to $380 million, which is kind of a big difference when you’re talking about  $150 million in renovations that the Angels would putting in as their part of the deal. So, how’s that calculation going, Voice of OC?

When Anaheim officials unveiled new stadium lease negotiations for the Angels last September, one of the biggest open questions facing taxpayers was the value of 155 acres of city land being traded for a $1-per-year lease.

Nearly six months later, city officials still can’t answer that question.

Alrighty, then!

The latest non-report comes in the wake of comments Tuesday by city sports venue manager Tom Morton, who said that an appraisal commissioner in November is underway, and should be ready in March — though according to the Voice of OC, he added that “it will be up to the City Council to decide whether to make it public.” Hopefully they’ll do so before actually voting on the deal, but maybe they think they can don’t have to if they can only avoid all being in the same room.