Bucks arena removed from state budget, film at 11

I’m on WiFi made of tin cans and string this morning, but wanted to update you briefly on today’s news:

  • There’s a Wisconsin state budget plan, and the Milwaukee Bucks arena proposal isn’t in it. That doesn’t kill the deal, but it does make passage even dicier, especially in the state senate.
  • The New York Post says there’s a deal to move the Arizona Coyotes to Las Vegas, which the NHL has denied in especially strong language, calling it “garbage.” (Unless they mean the Post itself is garbage, which, well, point.)
  • Minnesota United‘s owners are expected to ask MLS for an extension on their July 1 stadium deadline. Not that anyone ever said what would happen when the deadline was reached, so who knows what an extension would mean, but anyway.

And that’s it for now. Will try to provide further updates later, interweb connectivity willing.

MLS commish to Minnesota: You have five days to deliver stadium money, or else

With only five shopping days left until his deadline for Minnesota United to have a stadium deal in place and the Minnesota legislature no longer in session, MLS commissioner Don Garber spelled out what he’s actually expecting to get by July 1, sorta kinda:

“They have an upcoming deadline to hopefully finalize something with their stadium,” Garber said after New York City FC and New York Red Bulls held a press conference ahead of their match at Yankee Stadium on Sunday. “I’m not going to comment on it until that deadline has passed. I have a lot of respect for Bill McGuire and his partners. We love the market. We want to see something happen there. But we’ll wait and see. We really want to have a team in Minnesota, but they have to play in a downtown stadium because that’s the deal we cut.”

So that means that unless Minnesota officials “finalize something” by Wednesday, then MLS will definitely … do something. Maybe that’s pull the expansion franchise and award it to somebody else, maybe it’s issue another strongly worded statement. But you don’t wanna find out, Minnesota! Don’t make Don Garber come in there!

Garber also responded to a question about whether United could start out by playing at Target Field, the home of their co-owners the Twins, like NYC F.C. does with the Yankees‘ stadium:

“No, that wasn’t the agreement we made with them,” Garber said. “We’re going to make different decisions in different markets. That’s one thing being the boss allows us to do.”

Translated: We really wanted a team in New York, so we gave in there. But Minnesotas are a dime a dozen, so this time our deadlines really mean something. Whatever that is.

Columbus arena sparks opening of convenience store, bringing Twizzlers to struggling local economy

And now, here is an actual newspaper article from Columbus boasting about how the city’s new hockey arena prompted the opening of a 1300-square-foot convenience store:

“That’s the ideal tenant for that space,” said retail analyst Chris Boring, principal at Boulevard Strategies. “They’re not just filling space.”

With so many visitors, office workers and residents within a block or two of Nationwide Arena and the nearby Greater Columbus Convention Center, “it’s a no-brainer,” Boring said. “There are all kinds of places to eat and drink in the Arena District, but what if you just want a candy bar or a bottle of water? There’s really no place right now for that.”

In related news, the Chicago suburb of Bridgeview just sold another $16 million worth of bonds to help pay off its money-losing Chicago Fire MLS stadium, but this year a new gas station opened nearby.

Twin Cities suburb kicks tires on building Minnesota United stadium, doesn’t look at price tag yet

Looks like the Minnesota United stadium plan is going nowhere fast: The mayor of Minneapolis is dead set against giving the team $48 million in tax breaks, the state legislature adjourned without doing anything about the plan, and there’s a July 1 deadline at which point MLS could presumably rescind Minnesota’s expansion franchise, though there are plenty more where that came from. Sure, the Minneapolis city council approved a task force to discuss stadium plans, but that’s just one of those “keeping the lines of communication open” things that councils do. Too bad United can’t jump-start things with the threat of another city

Brooklyn Park is courting Major League Soccer.

City Council members said Monday that they’ll approach the Minnesota United team to explore building a Major League Soccer stadium along Hwy. 610 near the Target corporate campus, the proposed light-rail extension and a $90 million luxury apartment project under construction.

Ah, there we go!

Brooklyn Park, for those unfamiliar, is a Twin Cities suburb, so presumably could host an MLS team in theory. Whether it could offer a deal lucrative enough to make United’s owners happy (the Minneapolis Star Tribune reports that city manager Mike Sable “said it’s too soon to discuss subsidies”) when they have their hearts set on a downtown location is another question. But having another bidder, even an unrealistic one, is key to creating leverage in any negotiation, so you have to figure United’s owners are happy for the interest, anyway.

Minnesota United owner: Sorry, no money left over for taxes after giving league $100m

MinnPost ran a good article last week on Minnesota United owner Bill McGuire and how he’s all sad that his fellow Minnesota sports team owners got subsidies and he’s striking out. But I’d rather focus on one paragraph in the article:

McGuire isn’t exactly impoverished. Neither are the other members of the group he pulled together to buy the franchise and build a stadium just west of Target Field. The former CEO of UnitedHealth, who bought the team to keep the franchise from folding, described his ownership group as committed to making big league soccer work in the Twin Cities. But he has said the tax breaks are needed to have the franchise reach an operating break-even point.

This is seriously McGuire’s argument: You can’t make me pay taxes, then I’d lose money on this deal. What, you might ask, are the costs that would make paying taxes prohibitive? Well, he’d have to pay for building a stadium and hiring players and all the usual stuff, and, let’s see, anything else?

The team will pay Major League Soccer a $100 million expansion fee for the franchise officially awarded to Minnesota on March 25.

That $100 million fee isn’t written in stone — it was set by MLS as what they think they can get away with demanding for a franchise. So if you believe McGuire’s claims that $48 million in future property taxes would make his team a money-loser, that’s because MLS is insisting on getting $48 million more in expansion fees than a Minnesota team can profitably afford. If McGuire would only go to commissioner Don Garber and point out that his franchise would be a money-loser at the price the league has set, and demand a break from him … but we all know that’s not going to happen, right?

Of course, Orlando City S.C. is somehow managing to afford to pay both an expansion fee and property taxes, so maybe McGuire could open his books to prove his claims? Sorry, I’m just full of crazy thoughts this morning.

Minnesota fails to fund MLS stadium tax breaks, league says “We’ll give you two more weeks”

And speaking of deadlines, Major League soccer deputy commissioner Mark Abbott has said his league plans to stick to a previously announced July 1 deadline by which Minnesota needs to finalize plans for a new soccer stadium — and about $48 million in tax breaks that Minnesota United owner Bill McGuire is demanding as part of the deal — notwithstanding that the state legislature just adjourned for the summer without voting on a stadium deal:

“July 1st is the deadline that we put out there in March, and it remains the deadline,” said Abbott. “We’re going to decide [what happens next] on July 1, or closer to July 1st.”…

As DFL Gov. Mark Dayton and Republican leaders jockeyed in early June over what would be discussed during a special session of the Legislature — which took place Friday — McGuire’s soccer stadium barely was on the radar.

“It has not been mentioned one time,” Republican House Speaker Kurt Daudt said late last week. “It really has not been part of any conversation. And we didn’t have any outside groups pushing us on it, either. I don’t know if they saw the writing on the wall, but there was just no discussion of that in final negotiations.”

This seems like one deadline that will likely be enforced, especially since MLS has a near-endless list of other cities it can grant expansion franchises to (and then pull them from again if they don’t come up with stadiums, presumably). Though given that league commissioner Don Garber has already announced that he’ll start moving on expanding by another four teams later this year, it’s not like this is Minnesota’s last chance, either. Who knows? Maybe McGuire will decide to copy his colleagues in Orlando and just decide to pay for the whole thing himself.

D.C. and United approve stadium deal (again), stick taxpayers with most cost overruns (again)

The city of Washington, D.C. and D.C. United have officially agreed to a new stadium deal! Yes, they already officially agreed to one last December, but apparently they left out a few things, and then one thing led to another and suddenly team execs were lunching with development officials from Virginia, and anyway, now it’s really settled, so the stadium is happening for sure.

Along with the previously announced $183 million in public cash and tax breaks, the new, updated deal provides that:

  • D.C. United will agree to pay for half of the first $20 million in any cost overruns.
  • The team will also provide a $5 million escrow fund to reimburse the district for its costs if the stadium ends up not getting built for any reason.
  • The district has to either reach an agreement to buy the stadium land by September 30, or begin eminent domain proceedings to seize the land from its current owners. If it fails to do so, United can seek to relocate elsewhere.

This is maybe a marginally better deal for taxpayers than the earlier one — originally United’s owners weren’t going to pay anything for cost overruns, so $10 million is better than nothing. It’s still the case, though, that the team’s costs are capped, while the public’s are not. But then, it’s not like D.C. has any experience with sports stadium projects sticking taxpayers with ballooning costs.

D.C. United owner hits snag with district on cost overruns, mutters “Virginia’s nice this time of year”

When last we checked in on the new D.C. United stadium last December, the D.C. council had just approved $183 million in cash and tax breaks and construction was set to begin real soon now. So that’s that, and — hoooooooooold everything!

In the past three weeks, team officials have toured sites in Loudoun County, lunched with a Loudoun supervisor in New York and hosted a meeting with Virginia economic development officials at the team’s offices at RFK Stadium.

What seems to be going on here is that while the funding for the D.C. stadium is approved, all the paperwork hasn’t been — new mayor Muriel Bowser is still negotiating a “development contract” with the team’s owners to govern such things as cost overruns. So, naturally, it’s off to Virginia, where Gov. Terry McAuliffe has built a reputation for throwing public money (and personalized phone calls) at companies to get them to relocate to his state. Loudoun County officials say they can build a stadium for less than it will cost in D.C. (which probably doesn’t matter much to D.C. United owner Erick Thohir, since he’s not paying for most of it), and get it open in less than two years (which probably does, but is also pretty implausible unless they plan to make it out of plaster).

Anyway, this is almost certainly gamesmanship by Thohir — even the Washington Post obliquely notes that “it is possible D.C. United is using the discussion to gain leverage in the final negotiations over a Washington stadium” — while McAuliffe takes the opportunity to burnish his reputation as a Guy Who Gets Things Done (With Wads Of Cash And Tax Breaks). Not that it’s impossible that the D.C. deal falls apart and Loudoun emerges as a viable suitor, but seriously, with all the years that the D.C. United stadium squabble dragged on, if Thohir really wanted to go to the distant suburbs, don’t you think we’d have heard about it way before now?

Using ticket tax to fund new Revolution stadium in Boston would cost fans $41 a pop

In case you’re wondering, yes, New England Revolution (and Patriots) owner Robert Kraft still wants a new soccer stadium in Boston, whether or not it’s a converted Olympic stadium. In fact, the Boston Globe reports that Kraft has been talking to Boston Mayor Marty Walsh about it, and even has an idea for how to pay for one:

One scenario Kraft has floated with City Hall is having Boston build and own a $200 million soccer stadium, according to a person close to the situation who spoke on the condition of anonymity because the talks are ongoing. The debt would be repaid by a tax charged on tickets.

The Globe then goes on to lots of speculation about where a stadium would be built and whether Walsh would go for public funding, but let’s stop for a minute to explore another question: Does building a $200 million soccer stadium and paying for it with a ticket tax make a damn bit of sense? Selling $200 million in construction bonds would cost something on the order of $14 million a year to pay off, depending on interest rates and financing charges. Let’s give the Revolution the benefit of the doubt and assume they’ll sell 20,000 tickets per game (they average maybe 15,000 now, but MLS attendance figures are famously squishy), or 340,000 per year. That means a simple ticket tax of a mere $41.18 per person would be enough to pay off the stadium debt. Easy-peasy!

Okay, add in a few soccer friendlies and other exhibition games and maybe you could get the tax down to $30 or so, and maybe selling naming rights could knock off a few more dollars, but you get the point. This, in a nutshell, is why it’s so damn hard to get the numbers on new stadiums to work out: They’re really expensive to build, and there’s only so much more you can charge fans above what they’re already paying. Which raises the question: Why build a new stadium in the first place, as nice as it would be for Revolution fans in Boston to take the T to games, if it would be a massive money-loser? That’s another question to be addressed in future Globe articles, I guess.

Orlando City to give back subsidies and fund own soccer stadium, in world’s first June Fools joke

I’ve been pretty much out of commission today (will catch up on Monday), but this news item required a quick response:

Team owner Flávio Augusto da Silva announced Friday the franchise will privately finance the construction of its downtown soccer-specific stadium. The stadium, originally envisioned and pitched as a city-owned venue, will now be owned and operated privately by Orlando City.

Wait, what? The same Orlando City S.C. that got $40 million in city and county subsidies two years ago? And which was demanding another $30 million from the state? Suddenly da Silva found $70 million in his other pair of pants, and now he doesn’t need public money after all?

The arrangement will save the City of Orlando more than $15 million it had pledged for the project, in land and construction funding — and will bring in additional tax revenue for the city, because the privately-owned stadium will generate property taxes…

In addition to privately financing the stadium, which officials said is expected to cost more than the originally-projected $115 million, Orlando City will buy back the stadium land from the city.

There are a few possibilities here. One is that it is Christmas, or maybe the Rapture, and from now on sports team owners will decide that asking the public to pay their bills is just wrong, so from now on we’ll be paying construction bills and our taxes alike! A related, slightly less implausible scenario is that the Orlando City owners decided that they’d lose a pile of money if they didn’t break ground soon and had to delay their stadium’s opening, so throwing in $70 million in cash plus the cost of land plus property taxes until the end of time is totally worth it.

Or — and I’m sure some of you have thought of this already — maybe there’s another shoe to drop. I’m not sure what this would be (the da Silva press statement doesn’t leave a lot of loopholes for hidden subsidies, though having the city somehow cover operating costs would be one possibility), but there are a lot of suspicious factors here: The notion of a sports team owner willingly giving up already-approved subsidies, for one, but also the timing of this announcement on a Friday afternoon, when there’s little time for journalists to research WTF he’s on about before having to file their stories (and web videos) and head home for the weekend.

And unfortunately, I can’t do much better than that today, other than to raise a skeptical eyebrow and plan on following up on Monday. In the meantime, I certainly hope this is for real, and not one of those hoaxes that the kids today like to put over on gullible journalists.