Columbus to keep Crew, send Anthony Precourt to Austin, this has gotta be a win-win

I posted the week-ending news roundup late on Friday, but still not apparently late enough for the stadium news cycle, which promptly exploded in the afternoon, starting with the news that Cleveland Browns owner Jimmy Haslam was finalizing a deal to buy the Columbus Crew from owner Anthony Precourt so that it can stay in Columbus in a new stadium and Precourt can get an expansion team to move to Austin, Texas.

A bit of a recap for anyone new to this story: The Crew owners have been griping about wanting a new stadium to replace their current one (which was built all the way back in 1999) since they were the old Crew owners back in 2013; Precourt upped the ante last year by saying if Columbus wouldn’t build him a new stadium, he’d move the team to Austin. Precourt subsequently got Austin to approve a stadium deal there that included a $100 million tax break, but meanwhile Columbus sued under the “Art Modell Law” passed after the Browns moved to Baltimore to force Precourt to offer the team to local buyers first, and a fan group called Save the Crew issued proposals for a new downtown stadium in Columbus, to be paid for … somehow.

That takes us up to Friday, when it was revealed that Haslam — plus some local investors — had negotiated with Precourt and MLS to instead buy the Crew and have them stay put; Precourt will still get an expansion franchise in Austin, and everybody is happy. At least, maybe everybody is happy? There are still a bunch of unanswered questions here, like:

  • Who’s paying what to whom for what here? MLS is a “single-entity” structure, meaning that the league owns the actual teams, and the team “owners” only control operating rights. The Columbus Dispatch reports that the deal likely involves “the local investors purchasing the Columbus MLS rights from the league and current Crew operator Precourt Sports Ventures transferring its equity interest in the league to an Austin franchise, presumably an expansion team” — presumably this means Haslam and friends are paying something close to the $150 million expansion fee price that the league won’t be getting from Precourt. Unless maybe Precourt is paying the difference? This is all rich dudes shuffling money around themselves, so whatever, but it’d still be interesting to know.
  • What happens with the other cities looking for expansion teams? MLS already had a long list of cities angling to get the next two expansion franchises set to be announced, but it appears that Precourt and Austin have jumped the line. Media outlets in Sacramento, thought to be one of the expansion frontrunners, are already wringing their hands over the prospect of now only having one expansion slot to compete for. Assuming MLS doesn’t decide to keep both of next year’s expansion slots and make Austin its 29th team, or throw David Beckham back under the bus, or really anything, because MLS can decide whatever it wants here. (My bet would be on making the remaining cities compete for one slot, but if multiple cities come up with viable ownership groups and lucrative stadium subsidies, announce, “We changed our mind — everybody gets bees!”
  • Who’s going to pay for this new Columbus stadium, anyway? The Columbus Dispatch reports that there’s no deadline for a new Crew stadium to be in place, and that the team will continue to play in its old stadium until then, which would seem to reduce Haslam’s leverage if he wants to get public cash to help with his stadium plans. But it’s always possible Haslam has already been working things out along these lines with Columbus officials — news reporting on all this is fairly lousy so far, as to be expected when news drops on a Friday afternoon.

So what’s the upshot here? That MLS was more scared of moving the Crew to Austin than we’d been led to believe, either because of the Modell Law or because they didn’t want to be seen pissing off an established fan group or just because they saw the opportunity to get another NFL owner on board, and they just love those guys. Regardless, that Columbus will apparently get to keep its MLS team without having to pony up huge subsidies for a stadium for an expansion team has got to be seen as at least tentatively good news, and a sign that public mobilization can impact the battles of elephants. There are still many, many more shoes to drop, however, so glass-half-empty advocates, keep hope alive that this will still suck for someone! Anything is possible in the topsy-turvy world of MLS!

Travis County says Austin never consulted it on Precourt tax exemption, threatens to sue to block it

Oh hey, guess what? In its haste to approve a $100 million tax exemption for a new stadium for the soon-to-be-erstwhile Columbus Crew, the Austin city council neglected to consult Travis County, which would also be giving up a cut of taxes under the proposed deal. And Travis County commissioners are having none of it, threatening to sue to force the MLS team to pay taxes on its stadium if necessary:

On Tuesday, Travis County commissioners unanimously voted to “authorize the county attorney to preserve the county’s right to challenge the tax-exempt status of the stadium company’s use of city property.”

They also voted to “pursue negotiations with the city and other local taxing entities on expectations for preserving taxable value in the redevelopment of publicly owned real estate.”

The city’s proposed agreement with Crew owner Anthony Precourt doesn’t actually say that the land would be tax-free — it just says the city would own the land and stadium and lease it to Precourt, which usually works as a get-out-of-property-taxes-free dodge. Usually, but not always: A New Jersey court ruled in 2014 that Red Bull New York had to pay property taxes on its team-run, city-owned stadium in Harrison, on the grounds that a pro soccer stadium isn’t an “essential public purpose.” (The Red Bulls and Harrison later settled out of court on a deal where the team basically makes payments in lieu of property taxes.)

In Austin’s case, the tax-exempt status is up to the Travis Central Appraisal District, which is a county-run (I think — this information is not included among the CAD’s many, many frequently asked questions) agency that is in charge of appraisals. If the appraisal district grants an exemption, the county can, and it looks like probably will, appeal the ruling.

So what happens now, with a giant tax bill for Precourt on the line? The Austin American-Statesman asked Mayor Steve Adler, who replied, “I don’t know that, but I do know that the agreement says the team is responsible for any such taxes, not the city.” Ducking out of the way and letting your partner take the bullets — a time-honored tradition, but not one I expect Precourt is likely to appreciate. Can’t wait to hear what he’ll have to say about all this once he’s done admiring his new logo!

Austin approves final MLS stadium talks, Columbus Crew to move sometime or another probably maybe

Well, that was anticlimactic: After several weeks in which the Austin city council put off a decision on providing more than $100 million in property tax breaks for a new soccer stadium to lure the Columbus Crew to town, with four members in favor, four opposed, and three swing votes, yesterday the swing votes all swung toward “yes” and the measure passed 7-4. The Crew will now relocate to Texas at some point in the next year or two or three, unless the lease talks that were authorized yesterday collapse (unlikely at this stage), or Columbus wins its Modell Law suit to block the team from moving (who knows), or Crew owner Anthony Precourt changes his mind for some reason (also unlikely given how happy his press statement sounded after the vote, but also who knows).

The council also voted on 19 amendments to the stadium bill: I can’t find full coverage of what passed and what didn’t — it’s not helping that there’s no WiFi on this train even though there was supposed to be, clearly they need to tear down the train system and build a new one — but the Austin American-Statesman does report that the one to double the team’s rent to just under $1 million a year was defeated after Mayor Steve Adler warned that this was “the best deal of its kind in the country” and warned that asking for any concessions could kill it. I would beg to differ — Orlando S.C.‘s stadium deal was a fair bit better, for one. The Austin deal isn’t horrible as these things go, but that doesn’t make it reasonable either, but rather in that broad swath of “at least we didn’t get screwed over as bad as some other cities” that makes up most stadium deals. But then, soccer fans are used to celebrating pyrrhic victories.

Friday roundup: Delayed votes, poorly considered tributes, and a no-LeBron loan offer

Greetings from my undisclosed location! I have time for an abbreviated news roundup this week:

Four Austin councilmembers seek to cut Crew subsidy by $37m

Four members of the Austin city council have proposed revised lease terms for a proposed MLS stadium for the relocated Columbus Crew, two days in advance of a council vote on the subject. The new terms:

• Raising the team’s rent from $412,500 a year for 20 years (present value: about $5 million) to $958,720 a year rising by 2% a year (present value: about $14 million).

• Annual payments equal to the rent, to go toward local school systems (present value: $14 million).

• Having team owner Anthony Precourt pay for the cost of a Capital Metro rail station, (estimated cost: $12 million).

• A $3 per ticket surcharge, of which one-third would go to various public needs (present value: depends on how many tickets are sold, but let’s guesstimate $200,000 a year, which would be worth a bit over $2 million total).

If I can do simple addition this early in the morning, that’s about $37 million worth of additional money that would be flowing from the soccer team owners to the public. That would still be significantly less than the more than $100 million in property taxes that the team is looking to dodge (again, in present value; the total nominal amount over 25 years is likely to be more than $250 million), but at least it would reduce the value of the tax break somewhat.

Unfortunately, if I’m also doing math right, those four councilmembers are a minority of the 11-member city council, so unless they can swing a couple more votes their way, this proposal isn’t going anywhere. We’ll find out tomorrow.

Friday roundup: Untangling NYCFC’s stadium plan, fighting over the Crew’s future, and what to do with a luxury suite

Sorry for the radio silence the last couple of days — it was a combination of not much super-urgent breaking news and a busy work schedule on my end — but let’s remedy that with a heaping helping of Friday links:

  • Part of that busy schedule was wrapping up work on my Village Voice article trying to unravel NYCFC’s latest stadium plan, and while the upshot remains what it was a month ago — this is a Rube Goldberg–style proposal with so many moving parts that it’s hard to say yet if it would involve public subsidies — it also involves city parks land that isn’t really parkland but is really controlled by another city agency that isn’t really a city agency and denies having control over it … go read it, you’ll either be entertained or confused or both!
  • The state of Maryland has luxury suites at the Baltimore Ravens and Orioles stadiums, and Gov. Larry Hogan mostly uses them for family members and political cronies. This should come as a surprise to no one, but it’s a reminder that getting government use of a suite as part of a stadium deal is less a public benefit than a, what do you call those things?
  • Based on questions asked at a Monday hearing, The Stranger concludes that most King County council members aren’t opposed to the Seattle Mariners‘ demand for $180 million in future county upgrade spending on Safeco Field, in exchange for the team signing a new lease. That could still change, obviously, but only if all of you readers turn toward Seattle and shout this post in unison. Three, two, one, go!
  • MLS commissioner Don Garber says talks are “ongoing” with the city of Columbus about replacing the Crew if they move to Austin, and by “with the city of Columbus” he apparently means the local business council the Columbus Partnership. And even their CEO, Alex Fischer, doesn’t sound too in the mood to talk, noting that Garber has called for a new downtown stadium in Columbus while not requiring the same of Austin: “I find it extremely ironic that the commissioner wants a downtown stadium at the same time that the McKalla site is the equivalent of building a stadium in Buckeye Lake.” MLS deputy commissioner Mark Abbott retorted that Fischer’s remarks are “certainly a strange way to demonstrate an interest in working with us.” The lines of communication are open!
  • The owners of Nashville S.C. would have to pay $200,000 a year in city rent on their new stadium, which is … something, at least. Except, reports the Tennessean, “Parking revenue collected from non-soccer events at the new MLS stadium, such as concerts or football games, would go toward the annual base rent and could potentially cover the entire amount.” So maybe not really something.
  • Glendale has extended its arena management deal with AEG through 2026, which will mean continuing to pay $5.6 million annual management fees, but also collecting about $1.6 million a year in shared arena revenues. That’s not good, but it is significantly better than the lease that had the city paying the owners of the Arizona Coyotes more than $7 million a year after revenue shares, so yay Glendale for tearing up that lease and bidding out the contract to at least cut their losses.
  • Here’s Austin’s lead negotiator with Crew owner Anthony Precourt over a new stadium, Chris Dunlavey of Brailsford and Dunlavey. on whether the deal is fair to taxpayers: “All around, I don’t know how it could get characterized as favorable to [Precourt Sports Ventures]. I think the city of Austin has negotiated this to as favorable for a city as PSV could stand to do.” Uh, Chris, you do know that “good for the public” and “as least awful for the public as we could get” aren’t the same thing, right?
  • Former U.S. senator Barbara Boxer has thrown her weight behind Inglewood residents opposing a new Los Angeles Clippers arena because it could cause gentrification and displacement. Which, not all arenas do, but in hot urban areas like L.A. it doesn’t take much to cause gentrification and displacement, so I can certainly see why there’s concern.
  • An otherwise unidentified group calling itself Protect Oakland’s Shoreline Economy has issued flyers opposing the A’s building a stadium at Howard Terminal because, among other things, it could displace homeless encampments to make way for parking lots. This is getting David Beckham–level silly, but also it’s getting harder and harder not to feel like the A’s owners should just give in and build a stadium at the Coliseum site, since at least nobody seems to mind if they do that. Yet.

Precourt offers to pay Austin more rent if it’ll pay some of his repair costs, still thinks paying your property tax is for chumps

The city of Austin released its term sheet with Columbus Crew owner Anthony Precourt on Friday, and it would involve the city owning the stadium (but not getting a share of stadium revenues) and leasing it back to the team, sparing Precourt any property taxes. He would pay rent, but it’s not much: $550,000 a year, not starting until the sixth year of the lease, which is worth less than $10 million total in present value.

All of which we knew already, except for the rent amount, which had previously been set at $1. (We also know that Austin residents are not fans of the property tax break.) That’s an improvement, obviously, but Precourt is demanding his pound of flesh in return, as he now wants the city to chip in $975,000 over years 6 and 7 of the lease, and $125,000 per year afterwards, toward a capital repair fund. That won’t eat up all of the new rent payments, but it certainly takes a bite out of them.

The big question remains how much the property tax break would be worth to Precourt, and the best estimates are a whole hell of a lot more than he’d be paying in rent. It is yet another reminder that when evaluating stadium subsidies, just looking at construction costs is for chumps; savvy negotiators hide their free cash in the lease terms.

Austin council split going into June 28 vote on whether to open up bids on proposed Crew soccer stadium land

It looks like the soccer stadium vote at the final Austin city council meeting of the session on June 28 will come down to whether to open negotiations exclusively with Columbus Crew owner Anthony Precourt’s group or to put the McKalla Place land up for open bid:

Item 64 on the agenda is to approve a resolution that would direct the city manager to begin negotiating with Precourt Sports Ventures for a Major League Soccer stadium at McKalla Place in North Austin.

Item 60 is for a resolution that would direct the city manager to solicit development plans, including those for mixed-use developments, for McKalla Place.

The soccer-only plan is backed by Mayor Steve Adler and councilmembers Kathie Tovo, Sabino “Pio” Renteria, and Delia Garza; the open-bid plan is backed by councilmembers Leslie Pool, Alison Alter, Ora Houston, and Ellen Troxclair. That leaves three swing votes: Greg Casar, Ann Kitchen, and Jimmy Flannigan.

If you’re trying to handicap those swing votes, here’s their record so far on the Crew stadium debate:

So if we count Kitchen as leaning against the soccer-only deal, and Flannigan as leaning for, it looks like we could be headed for a very, very busy week of lobbying calls to Greg Casar. He might want to put in a call to Miami to talk to Michelle Spence-Jones for tips on haggling.

*CORRECTION: McKalla Place is indeed city-owned, but Kitchen was reportedly (see comments) opposed only to using city owned parkland for a stadium, not any city-owned land. So if Kitchen is indeed okay with the MLS-only plan, then maybe Casar’s phone won’t be ringing quite so much off the hook this week.

Friday roundup: Kraft tries to use World Cup to get new stadium, Roger Noll says Austin MLS subsidies are indeed subsidies, NC mulls new tax breaks for Panthers

Posting this while watching the first World Cup match at the crazy stadium with the seats outside the stadium. (I haven’t honestly even noticed who the teams are yet, I’m just watching the architecture.) Anyhoo:

Another Austin councilmember thinks Crew stadium proposal is a load of poop

The Austin city council held its first official discussion of a proposed MLS soccer stadium to host the relocated Columbus Crew yesterday, and apparently Leslie Pool isn’t the only councilmember who went into it having done her reading. Just check this out:

Council Member Alison Alter, who has aligned with Pool in the debate, cited an economic study by Stanford professor Roger Noll critical of most stadium deals cities strike with major league sports owners.

“Austin is wonderful, but we don’t defy the laws of economics,” Alter said. “According to this proposal, we’re giving away our land for free. I have an issue with that.”

Elected officials namechecking Roger Noll without prompting! Maybe we really are in the brave new world predicted by, uh, Roger Noll!

The council is set to meet again on Thursday, but soccer isn’t on the agenda, meaning the decision on whether to give Crew owner Anthony Precourt free land and a bunch of infrastructure money is likely to come down to one final winner-take-all debate on June 28 — though the opposition proposal is likely to be less “don’t let the door hit you on the way out” and more “open up the site for competitive bidding so we can see if we get any better offers.” Aside from Pool and Alter being opposed, and both Mayor Steve Adler and Mayor Pro Tem (vice-mayor, basically) Kathie Tovo being in favor, most councilfolk didn’t have much definitive to say yesterday other than this thing is 189 pages, we need to read it more carefully. Good thing they’re going to have two whole meetings to discuss it, because that sure is democracy!